PC Sales Remain in a Slump No Matter What Morgan Stanley Says

Morgan Stanley says we are near the trough in the decline of computer sales and that it’s going topc_shipments be all uphill from here. But why? WHY? The article points to no particular reason for the upturn they are predicting beyond “the cycle.” This is about the same as the constant rosy predictions from the ratings agencies over the last few years. It’s always “buy” and “AAA” but no reason WHY!

From the article:

It’s been a grim recession for computer companies. First quarter PC shipments were down 8.1% from year ago levels and down 14% from the prior quarter. But that’s what happens in recessions. The newer data, though, says green shoots are sprouting, with important implications for business and investors.

As this chart shows, the severe drop off in demand has been punishing. But with technology advancing “” and computers aging “” the seeds for a replacement cycle are in place.

There is no rational reason to think PCs will auto-replenish based on needs. Aging hardware can run less demanding apps in the cloud just fine. Running a business I am holding off on hiring. Thus being a growth business we have extra hardware on hand even if we simply hold back. Other businesses have done layoffs so logically they have computers by-the-extra. Why would all of the declining lines suddenly turn back up Morgan Stanley? They won’t.

As the article indicates Netbooks WILL go up, but at a lower cost per unit. If people switch from MS Office to Google Apps this takes less hardware, not more. And it lets employees work remotely without installing a VPN at great expense and frustration. The article acknowledges this but doesn’t reconcile the amazing recovery in the graph with the stated:

…a key driver of demand in the next 18 months will be smaller and smaller computers. The growing popularity of netbooks, those smaller laptops that can easily fit in a briefcase or handbag and offer basic computing tasks, such as web browsing, are the prime case in point. Netbooks are cheap, and with new, high efficiency processors now on the scene, they will likely get more powerful, and cheaper still.

My point here isn’t that PC sales are in a slump, an article from May that suggested we were at the bottom (nope!), and are going to stay that way for a while. My main point is that Morgan Stanley analysts are still viewing the world through rose colored glasses. And that didn’t work out so well for us last time.

Why do I chew on these bones? Because the market has to correct. Stop trying to delay it, pull the band-aid off, review home values, but lets start talking with candor again please.

Schipul Facebook Fan Promo – Win a free laptop!

Free laptops are good. Yup, call it a material incentive on top of social motivation, but we are giving away a free laptop to one of the fans of the Schipul Facebook page on June 30th 2009. Get the details here!

In steps:

  1. Read the blog post on the free laptop giveaway for fans of the Schipul FB page. Comments are appreciated but the winner will be selected from the FB fans.
  2. Become a fan by clicking the “become a fan” link on our page.
  3. Wait until June 30th and wooooot!

Fine print is on the blog. Short version is fans on the FB page, excluding employees and immediate family (sorry! But we’ll make it up to y’all), selected at random. Read the details here!

Caroline Collective Coworking Space Anniversary

Houston’s own Caroline Collective Coworking Space is having an anniversary party this Saturday!

And a few more related links to the party THIS Saturday at Caroline.

1. Caroline link post: http://carolinecollective.cc/2009/06/04/were-one-lets-have-some-fun/
2. Facebook invite: https://www.facebook.com/event.php?eid=184256345206
3. Artshound: http://www.artshound.com/event/detail/25097
4. Mentions on twitter: https://twitter.com/#search?q=@carolineco%20party

I hope to make it on Saturday and hope to see y’all there too! From the announcement:

And a special thanks to the party sponsors step up to offer things to donate and would love to show them some love, including Riazul Tequila, Sweet Leaf Tea, Saint Arnold, 29-95.com, Tacos A-go-go, Danton’s Gulf Coast Seafood, and Aztec Party & Tent Rental.

Don’t Fight It will DJ and the illustrious (you)genious will serve as MC.

Houston Green Scene will be providing the party favors: 2″ biodegradable peat pots with organic potting soil and planted daisy seeds.

Collins: The Five Key Things to Consider When Looking for the Right People

The following are my notes from listening to Jim Collin‘s audio coaching on “getting the right people on the bus.”

From Jim Collins: The Five Key Things to Consider When Looking for the Right People

“What are the characteristics of the right people? Are there any generic characteristics we are looking for in the right people.” … “As I see it, there are five basic characteristics, five basic criteria, for being a “right person on the bus“

  1. They must share the core values.
    1. “The person must share the core values of the institution or the organization you are building.“
    2. “You can’t get people to share your core values.“
    3. “The whole task is to find people who already have a predisposition to your core values…They must share the core values… those who do not have a predisposition to sharing the core values get ejected like a virus. Get escorted out the door by the organizational antibodies.“
  2. A right person on the bus is not someone that you need to manage.
    1. The moment you feel the need to manage somebody, or tightly manage somebody, you’ve probably made a hiring mistake. … that is one of your key clues that you might have the wrong person on the bus.
    2. The moment you feel the need to manage somebody, you’ve probably made a hiring mistake.
  3. Could they be the best in the industry in that seat?
    1. In the seat that they hold, could they potentially be one of the best in the industry … in that particular seat? It doesn’t mean they actually “are” the best, but at least possible that they could eventually become one of the best
  4. The Individual understands the difference between having a job and holding a responsibility.“
    1. “My assistant Vicky gets this so well… “If you were an air traffic controller and you did your job and you did all the right things but the planes still crashed, would it matter? No, it wouldn’t matter… You have a responsibility that goes far beyond having a job. …   the responsibility to worry three steps ahead to ensure that the planes don’t crash.
    2. That sense of “I have a broader sense of responsibility” rather than “I have a job” the ability to get that distinction is one of the crucial dimensions of the right people on the bus.Tthey are what I would describe as productively neurotic. If they see a hole they feel the need to fill it and to make it better.
  5. If it were a hiring decision all over again, given everything you know having worked with this person, would you still hire?
    1. This is the litmus test question.
  6. Lastly – You must be fair.
    1. And fair in the following sense. Always ask yourself the following question. Do you have a “bus problem” or do you have a “seat problem”. It could be you have a wonderful great person on the bus but you made a managerial mistake and put that right person in the wrong seat?“ “When in doubt, be fair.“

Of course he makes it sound so simple. Having been hiring and (unfortunately) firing people since my very first job out of college, I know all too well how hard it is to interview. The advice given on hiring people is always “do lots of interviews” and “slow down the process until you are sure.” Which sounds great, except not every good job applicant will go through 10 interviews and wait six months for an offer. In other words the market varies. And quite frankly you can’t always tell.

I have learned to be wary of certain groups of job applicants in the hiring process.

  1. The prideful.
    1. Prideful people do dumb things to save face. The humble will just go “damn, I screwed that up. But I learned.” The prideful will make a bad decision and then defend it to the bitter end in front of the entire company before they admit a mistake. Humble people rule.
  2. Those that tell you they are smart.
    1. Um… you are an adult. If you have to tell me you’re smart in the first five minutes of the interview something is wrong. Those silly tests only test about a third of your actual knowledge, and if that is a prop for your ego we have a problem. Tell me you are a hard worker, tell me about results, but don’t tell me you’re smart. Sheesh. What you really want is a humble hard worker who lets their work product shout about how awesome they are while their own words are quiet.
    2. Interesting conversation about telling if someone is smart here.
  3. The insecure.
    1. The most dangerous group of all. The insecure turn on you unexpectedly and like a mine field they can lay in wait for 50 years before going off. The insecure follow a leader instead of their own hard coded core values. As such they jump ship when a leader trips, and every leader must take risks and therefore WILL trip. The leader will get back up, but the mine goes off.
    2. Sometimes a leader can expedite discovery by intentionally appearing to make a mistake. But be careful.
    3. The insecure are also the most likely to rationalize unethical behavior.

There is no easy answer to hiring and firing, or to determining “which seat on the bus” a person is most qualified for. And timing also matters, a person may outgrow a position and a position can outgrow a person. Sometimes the person is so good you just need to put them on the bench, let them sit in the wrong seat for a little while before the right seat comes available. These are heavy decisions.

Having to make these decisions, one thing I am personally committed to is the development of my people. While I can’t control the economy or stop acts of God, I can ensure that no matter what my people are as prepared as possible for whatever lies ahead. Training and growing our team is within my circle of influence.