Archive for Business

Kicking back with Twitter’s Biz Stone [New York Times]

New York Times, May 27 2010

Biz Stone. Photo: Phil McCarten/Reuters.

Biz Stone. Photo: Phil McCarten/Reuters.

Biz Stone co-founded the micro-blogging service Twitter with Evan Williams in 2007. They met seven years ago when they both worked at Google. Stone earned an arts scholarship to the University of Massachusetts but dropped out to work as a designer at the book publisher Little, Brown in Boston.

In 1999, he helped start the blogging community Web site Xanga. Originally from Boston, Stone lives with his wife, Livia, in Marin County. Here, edited and condensed, are excerpts of his description of a leisure day. (Yes, he does post to Twitter during his time off.)


Frisky Fidos
| My wife, Livy, and I wake up at 7 every morning, including Sunday. We’ve got two rescue dogs that get a little feisty if we don’t feed them: there’s Pedro, the one-eyed Chihuahua, and Maggie. Once the animals are sated, I usually do a quick check of e-mail and online news with a glass of water.


Culinary Mash-up
| A typical Sunday morning starts with something I don’t usually bother with — breakfast. Livy puts together something for us to eat. Lately, it’s been southern style biscuits from scratch. We’re both vegan. Her dad is from Nashville and her mom is from Istanbul, so there’s an interesting range of influence in her cooking. Then we take the dogs out. Living in Marin means we can take them to so many beautiful spots, but, ironically, one of their favorite places is an office park near our house.

Memo From the Boss | There is work on my Sunday agenda. For almost two years now, I’ve been sending out a weekly e-mail address to employees, board members, investors and advisers. The e-mail covers accomplishments, mistakes, news, some funny personal anecdotes, recognition for a few team members. It takes a few hours to research and write. I’ll often go to a local Starbucks because it removes the distractions of home. I plan my whole Sunday around writing the e-mail. We’re going to be thrown for a loop when the opera season starts, as our tickets are all for Sunday matinees. I do Twitter on Sundays, but I always keep it under 140 characters.

Running the Sun Down | On Saturday, I do an eight-mile run, and on Sunday I do a 10-mile run. Richardson Bay from Mill Valley to Tiburon and back is a favorite route. I’m partial to timing my runs just as the sun starts to set.


Far From the Madding Crowd
| We moved from Berkeley to Marin several months ago. I’m coming to appreciate country living, especially on the weekend because it’s more relaxing. We’re in Larkspur, which is generally quiet on Sunday. The spot is more commercial than neighborhoody, but it’s pretty fun that I can ride a boat to work on Monday mornings.

As the Day Turns | “How To Make It In America” comes on HBO on Sunday night, so I like to watch that if I can. I generally turn in around midnight no matter what day it is.

Opponents of cellphone towers try a change in tack [New York Times]

New York Times, May 7 2010

scouts1

Parker Douglas, left, and Eric Burnstein heading to the Camp Herms Boy Scout Camp above Arlington Park in El Cerrito. Photos: Thor Swift for the New York Times.

Last summer, it all seemed so simple. The cellular telephone company T-Mobile approached the Mount Diablo Silverado Council — Boy Scouts of America to see if it would allow construction of a cellphone tower at Camp Herms, the group’s 23-acre hillside property above Arlington Park in the El Cerrito hills.

The company’s offer included a payment of $2,200 a month for 30 years, money the scout group said would help finance remodeling work at the camp and allow it to create additional programs. The scout council accepted the offer.

What it did not anticipate was the reaction from its members and camp neighbors.

Seven hundred people signed a petition protesting the proposed tower, 250 letters were sent to the scout organization, at least one scout master threatened to move his troop, and a local childcare center and the Sierra Clubadded their names to an orchestrated campaign against the tower. At the center of their opposition are concerns over health risks, particularly for children.

“We were stunned by the response,” said Valerie Ridgers, Mount Diablo Silverado Council’s assistant scout executive. “The tower would look like a tree, and there are no health hazards. The last thing we would ever do is put something up that would harm our scouts.”

The project has been put on hold while T-Mobile does a review, though the company will not say whether this is a result of the protests.

A sense of déjà vu is palpable. Community resistance to cell sites has been common since the mid-1990s, when the first big wave of cellphone tower construction began. In San Francisco, residents are organizing against proposed T-Mobile wireless facilities in at least six neighborhoods: the Sunset, Outer Sunset, the Mission, Miraloma Park, North of Panhandle and Presidio Heights.

In February, the Walnut Creek School District rejected a lease agreement with Clearwire to install a 37-foot wireless broadband Internet antenna at the Walnut Heights Elementary School.

But if the fights are familiar, the context has changed. The question surrounding the protest over the El Cerrito tower and other proposed locations for antennas is: How much coverage is enough? How many camouflaged antenna-trees must be introduced into the landscape to keep all those iPhone apps humming?

The 1996 Telecommunications Act prevents state and local governments from considering health concerns in locating wireless facilities. So the battles are often fought over aesthetics and need.

The growing popularity of smart phones, in particular, is driving demand for more cell sites. Sales of mobile phones stood at 1.2 billion worldwide in 2009, according to figures from Gartner, an information technology research and advisory company, and sales of smart phones rose to 172.4 million in 2009, up 24 percent from 2008.

scouts-2

AT&T says wireless data traffic on its network has grown more than 5,000 percent over the past three years. It says its wireline and wireless investment in California will total $18 billion to $19 billion this year, up 5 percent to 10 percent over 2009, with the addition of at least 200 new cell sites and upgrading about 500 additional sites.

Sprint says the Bay Area is one of its top 10 markets in terms of subscriber demand. Tower Source of Colorado Springs, which maintains an extensive database of cellphone tower sites, calculates there are 2,925 sites in the greater Bay Area, each with multiple carriers.

Nationwide, Tower Source said, demand for sites is increasing at about 13 percent annually.

The San Francisco Neighborhood Antenna Free Union estimates there are upwards of 500 locations and more than 2,500 individual antennas serving San Francisco, not including antennas on light and utility poles in the city’s public rights-of-way, or unlicensed WiFi hotspots in homes, coffee shop and libraries.

This is still not proving to be enough in some parts of the city. To address complaints of patchy iPhone signals, AT&T last month introduced Micro-Cells, miniature towers for inside offices or living rooms, which cost $150.

But as the infrastructure needs grow, opposition is becoming more vocal. In El Cerrito, a group calling itself Arlington Park Against Cell Tower has conducted its own research, which it says proves that local mobile phone signal strength is more than adequate. It suggests T-Mobile does not need the tower to improve coverage because it has a tower a half-mile away at Moeser Lane and Arlington Drive, and says a tower would lower values of nearby properties.

And despite assurances that there is no scientific basis for health worries — the Federal Communications Commission says there is no risk from the radio frequency radiation emitted from cell sites — worries persist.

Scott Houser, who leads El Cerrito Scout Troop 104, said that if the cell tower was erected, he would push to move his troop.

“We have this pristine gem in the city in the great outdoors, and I am fearful of the health hazards of a cell tower,” Mr. Houser said.

Nancy Kelleher runs Hug A Bug Pre-School, which is a few hundred feet from where the tower would stand. “There are no guarantees this is safe,” Ms. Kelleher said, “and it’s always after the fact that we find out there are health hazards in cases like this.”

“Child care is a competitive field,” she added. “I might have to relocate.”

Last month, Mayor Gavin Newsom of San Francisco signed a Board of Supervisors resolution calling on the federal Environmental Protection Agency to study the health effects of wireless facilities and requesting the repeal of the limitations that prevent health concerns being considered in cell site siting cases.

Mr. Newsom also supports a bill written by State Senator Mark Leno, Democrat of San Francisco, that would make San Francisco the first city in the country to require that cellphone retailers label their devices with the level of radiation they emit.

But impeding the expansion of the wireless network is a tall order. Roger Entner, an analyst at Nielsen Mobile, said that there were plenty of cases where municipalities had said no to a proposed cell site, but that “every single time, the municipality zoning board blinked and settled.”

Nonetheless, Doug Loranger, co-founder of the Coalition for Local Oversight of Utility Technologies, a nationwide organization working to change federal policy on cell towers and other wireless facilities, said he believed that legislation was tilting in favor of local governments.

Mr. Loranger cited the example of John Avalos, a San Francisco supervisor who is preparing legislation to institute a new permitting process for antennas proposed in public rights of way. He also mentioned the city of Glendale in suburban Los Angeles.

“After an 18-month moratorium on new cell sites that will end this June,” Mr. Loranger said, “Glendale will have adopted one of the most stringent celltower-siting ordinances in the state of California.” The ordinance will increase the city’s oversight of the placement of antennae; cellular equipment proposed for residential areas will face a more intense review process; and carriers may need to prove why the equipment is needed.

In El Cerrito, which, according to the city’s Planning Department, currently has 12 cellphone towers, the debate over another one being put up in Camp Herms is in limbo.

On March 30, T-Mobile informed the city that it was putting its application on hold.

“We want to further evaluate our network in El Cerrito,” said Rod De La Rosa, senior external affairs manager at the company.

Not every El Cerrito resident opposes the tower. Tracy Sichterman, a real estate agent who lives in the Arlington Park neighborhood, said: “I believe the debate about the need for cellphone coverage ended when consumer demand put a cellphone, or P.D.A., in nearly every hand including those of many of our children. Parks and open areas away from homes may make good location candidates for new towers.”

Ms. Sichterman said the effect on home values related to visual impact.

“Real estate values are clearly affected when an electrical or cell tower looms over a property’s backyard,” she said, “but this impact quickly diminishes when the tower is distant.”

On the other hand, Ms. Sichterman has started to see “poor cellphone reception” appear as a property defect in real-estate disclosure statements. “Some buyers, particularly those who work remotely, consider this to be a material concern when purchasing a home,” she said.

Sunday Routine: Markos Moulitsas [New York Times]

moulitsas

Photo: Peter DaSilva/New York Times

New York Times, March 26 2010

After a long ride, the fantasy of a perfect day

Markos Moulitsas is founder and publisher of Daily Kos, the largest liberal blog in the United States, with one million to three million unique visitors a month. Mr. Moulitsas, 38, started his blog in 2002 after a stint at law school persuaded him that it would be “a cold day in hell” before he ever worked as a lawyer. Born to a Salvadoran mother and a Greek father, he is the co-author of “Crashing the Gate: Netroots, Grassroots and the Rise of People-Powered Politics.” He lives in Berkeley with his wife and two children. (His words have been edited and condensed.)

RUDE AWAKENING I have a 6-year-old and a 3-year-old. Sleeping in isn’t an option. My wife is an early riser and takes care of their needs, but I’m rarely in bed past 7:30 a.m.

LOGGING ON I grab my computer and quickly check in on my site and e-mail, make sure there aren’t any problems. Another quick scan ensures no big news happened overnight. I then check on the kids, who are usually fighting over the remote control or whining about having to go to church with my wife.

TWO-WHEEL WORK I eat a carb-heavy breakfast, fueling up for my long Sunday cycling training ride. Right now, that means a 50-to-60-mile ride, about three to four hours. I ride in the Berkeley and Oakland hills, Moraga, Orinda. Once a month, starting in May, I’ll be doing one century per month — organized rides of 100 miles or more. My big goal for the year is Death Ride: 129 miles with 15,000 feet of climbing over several mountain passes in the California Sierra.

REFLECTIVE TIMES You’ve got to think about something while on the bike for so many hours, so I try to work out family and work issues and strategize. I like to flex my entrepreneurial muscles, dreaming up new features for my site or even new business ideas. I’m also a classically trained pianist and composer, so I might dream up a catchy tune.

BIRTHDAYS AND BEARS Sundays are a big birthday day, so with two small kids, chances are there’s a birthday party. If not, the kids must be entertained, so it’s off to the Oakland Zoo, or hiking or going to a park. If it’s football season, I’ve got to watch my Bears. So I might have some people over so that the kids play together while I watch the game.

FANTASY LAND On an ideal Sunday, rather than a real one, I’d go out for my big, long bike ride. I’d get home. The kids would magically be napping, so I could take my own recovery nap. A few hours later, we’d wake up, go out for an early dinner. No one would fight, no one would spill food or drink all over themselves. We’d go to the park, have a great time, and when I told them it was time to go to bed, neither of them would complain. Add a Bears victory into the mix, and we’ve gone from ‘ideal’ to ‘perfect.’

Organic or Authentic? The Saul’s Deli Debate [New York Times]

New York Times, February 4, 2010

sauls

What’s not to like about Berkeley’s favorite deli? Why all the kvetching?

In many ways Saul’s Restaurant and Delicatessen in Berkeley — just a few doors down the street from Chez Panisse, the grande dame of the slow-food movement in the Bay Area — is the quintessential farm-to-table restaurant. It features local food, organic produce and a seasonal menu.

So why the consistent grumbling from perhaps one customer in five? Nostalgia, said Peter Levitt, the co-owner and chef who is a Chez Panisse alumnus. “We have so many culinary memories under one roof,” he said.

Which is a nice way of saying that some people prefer pastrami made the old-fashioned way — industrially — and feel that anyone who doesn’t approve of the high-fructose corn syrup in Dr. Brown’s cream soda should just suck it up and adjust.

If there’s one dining experience above others which is pregnant with expectations, it’s the Jewish deli. The pastrami sandwich had better be so large you can barely get your teeth into it. The blintzes had better taste like the ones your grandmother made.

The problem is that the deli menu many people regard as authentic, and which reached its heyday in the 1950s, is rooted in the industrial food system. Those towering pastrami sandwiches are typically created with factory-produced meat. The rye bread? Pasty and processed.

Ever since Mr. Levitt and his partner, Karen Adelman, took over Saul’s in 1995, they have tried to make the restaurant’s voluminous menu more sustainable, as they describe on the deli’s blog.

In 1998, Acme bread (founded in Berkeley) replaced the spongy white rye the deli had shipped in from New York. It is now broadly appreciated. They source their fish from Monterey Fish Company and their beef from Marin Sun Farms.

A year ago, they did away with Dr. Brown’s sodas, both because of the food miles they incurred and the high-fructose corn syrup on the label. The change proved to be the last straw for some die-hard deli fans.

“There were those who said if you don’t have Dr Brown’s, you’re not a Jewish deli,” Mr. Levitt said. “People forget that the original Jewish sodas were handmade and sold off the back of street carts.”

The house-made celery, cream and black cherry artisanal sodas, which took the place of Dr. Brown’s, now have their own loyal following.

Worried about what would happen if he went forward with more changes, Mr. Levitt called for a “referendum on the deli menu.” The event, which was set for Tuesday at the deli, will now be held at a bigger venue (the Jewish Community Center of the East Bay) to accommodate the more than 175 people who are paying $10 each to attend. It promises to explore questions like these: “What taste memories and flavors of the deli have been provided by an industrial food system? How can we look at our nostalgia and expectations critically?”

In fact, most customers appreciate the changes. Their grass-fed corned beef sandwich may be smaller or more expensive than the ones they ate back East, but it’s tastier, healthier and easier on the conscience.

But the restaurant staff also meets resistance, sometimes even hostility: One customer vowed never to return after seeing that gefilte fish was off the menu because it was out of season; another complained loudly when chilled borscht wasn’t an option in November.

Now, Mr. Levitt and Ms. Adelman say they have reached a crossroads — there is more they would like to do to the menu, yet they fear the backlash. That is what inspired Tuesday night’s event. They are bringing out the big culinary guns to put the future of their restaurant under the spotlight. Is the concept of the sustainable deli itself sustainable?

On the panel next Tuesday: Michael Pollan, a Saul’s lunchtime regular; Willow Rosenthal, the founder of City Slicker Farms; Gil Friend, the author of “The Truth about Green Business;” and Evan Kleiman, the Los Angeles chef and radio host.

Ms. Adelman says they are in effect seeking permission from their customers to continue tweaking what she describes as “an ossified menu.” Just as Jewish food has evolved over the centuries, those who run Saul’s are hoping customers will, for instance, rediscover traditional Sephardic-inspired dishes, which put vegetables, legumes and seafood at the center of the plate rather than meat.

“We want to bring our customers with us,” she said. “They’re our family, our heart.”

It’s a familiar story for David Sax, who wrote the recently published book“Save the Deli.” He has spoken at Saul’s.

“The deli customer is very opinionated, the feedback never stops — which is a blessing and a curse,” he said. “No one is more committed to a new approach to the deli than Karen and Peter. And their concept of taking deli food back to a time when food was respected is a good indicator of where delis could go from here.”

Mr. Pollan also supports the efforts at Saul’s.

“They are trying to do something very admirable, but it’s challenging,” he said. “Good meat costs considerably more than feed-lot meat, and it’s easier for a white-table establishment to absorb the costs of doing it right.”

As for Mr. Levitt, he admits he’s frustrated. “Alice Waters looked at the French menu and reinvented it,” he said. “Why can’t we do the same for the Jewish deli menu?”

New home for Michelle Kaufmann’s prefab designs [SF Chronicle]

San Francisco Chronicle, September 30 2009

glidehouse-main

Architect Michelle Kaufmann, who closed her Oakland firm in May, citing the impact of the financial meltdown and the plunging housing market, has sold the building rights to several of her signature prefabricated, sustainable houses to Boston company Blu Homes.

The deal, announced Monday, means Blu Homes will now offer versions of the Kaufmann-designed Glidehouse, Breezehouse, mkLotus and mkSolaire nationwide. The terms of the purchase have not been revealed.

“I’m happy for all the people who put such hard work into making MK Designs happen, and that these designs are going to have a new life,” Kaufmann said.

Blu Homes, which opened last year, has its own factory and has built 10 houses, mostly on the East Coast. Co-founder Bill Haney said that by applying it’s technological know-how to Kaufmann’s designs, Blu Homes hopes to offer the homes at a more economical price.

“We share Michelle’s vision of creating beautiful, healthful homes and admire the West Coast sensibility her homes represent,” he said. “Our technological innovations will allow her homes to be brought to a bigger audience, both economically and geographically.”

Blu Homes founders spent three years researching modular home construction with a team of designers, scientists and engineers from the Rhode Island School of Design and MIT before starting the company. Their goal is to build preconfigured, sustainable homes that are affordable to the average American - and whose energy efficiency can be constantly monitored.

They have developed a proprietary unfolding modular technology that will enable cost savings to be made on Kaufmann designs at the shipping and on-site building stages. Elements that make up the homes such as wall panels are created with hinges so they can be compacted for transportation and unfolded on site. The MK Designs homes will have slightly different floor plans, proportions and elevations from the originals, although, Kaufmann said, the design principles should remain the same.

Kaufmann, who has built 40 eco-friendly preconfigured homes since 2002, has led the way in lobbying for more environmentally responsible building practices, and her firm won several awards for its sustainable architecture. The Sierra Club called Kaufmann “the Henry Ford of green homes.”

She will serve as a design consultant to Blu Homes and join its advisory board. She also continues to practice architecture with her own studio, with current projects including a housing community in Denver and a luxury eco-resort in the Bahamas.

Prefab Queen Shuts Up Shop [SF Chronicle]

Michelle Kaufmann Designs Closes Doors

San Francisco Chronicle, June 14, 2009

kaufmann

When Oakland architect Michelle Kaufmann, known for designing sustainable, prefabricated homes, announced late last month that she was being forced to close her firm, reaction was swift.

More than a few observers expressed dismay because they had been intending to buy one of Michelle Kaufmann Designs’ homes.

“This is sad. I love her designs and was actually planning on purchasing one in the fall,” wrote a commenter on The Chronicle’s On the Block blog. “So sorry to hear this is happening,” said another. “We, too, looked forward to a green retirement in a Breezehouse.”

On a different Bay Area property blog, reader Audan wrote: “This is terrible news. I have been looking for land in Sonoma County to put an mkHearth home on.”

A lack of clients was never Kaufmann’s problem, according to the architect.

“There is definitely a demand for efficient, healthy homes,” she said. “And it’s going to increase as more people view homes as somewhere they want to live for the long term rather than as a short-term investment.”

Since 2004, MK Designs has built 40 single-family homes, mostly in the Bay Area, and Kaufmann is working on two multi-unit projects, one in Denver, the other in Los Angeles.

MK Designs has completed significantly more homes than other independent Californian firms specializing in prefab homes, such as LivingHomes and Marmol Radziner, both based in Los Angeles. And Kaufmann says another 100 homes were scheduled for construction over the next two years.

If anything, the issue was more about supply than demand - that, coupled with the financial crisis. As Kaufmann, 40, put it in her blog post: “Despite our best efforts, the financial meltdown and plunging home values have caught up with us. The recent closing of a factory partner, as well as the gridlocked lending faced by homeowners, has proved more than our small company can bear.”

The Sacramento factory partner that shuttered a few weeks ago was the second factory MK Designs worked with to go out of business. The first time, with a factory in Los Angeles last year, MK Designs was left in the lurch. They had several homes under construction when the supply of materials dried up.

The difficulties Kaufmann faced finding a reliable source for the building blocks of her homes - be it reclaimed wood flooring, folding glass doors or high-performance insulation systems - go to the crux of the issue for MK Designs: scale.

“Our mission has always been to create sustainable, accessible architect-designed homes,” she said. “That was why we chose the modular system. But in order to achieve cost efficiencies, we required scale, and that took longer than we wanted.”

Kaufmann founded MK Designs with her husband, wood craftsman Kevin Cullen, in 2004. The company quickly gained a reputation for its attractive home designs, including the mkLotus, the Glidehouse and the Breezehouse, the latter produced in conjunction with Sunset magazine.

Kaufmann led the way in lobbying for more environmentally responsible building practices, and the firm won several awards for its green building credentials.

It all began when she and Cullen were looking for a home to buy and, when it became clear they weren’t going to find what they wanted, decided to build their own. Kaufmann had moved to the Bay Area after working for five years for noted architect Frank Gehry in Santa Monica. She describes that experience as inspiring: “You would go to an opening of a museum he had designed and see people weep. It really demonstrated the power of good design,” she said.

Unfortunately, good design was in short supply in the houses she and Cullen viewed as potential homes. “So much of what we saw was poorly designed. It’s a significant problem in the United States: Most homes are not healthy or efficient,” she said. “And hiring an architect takes time and can be expensive, so not many people do it - only 3 percent of homes are designed by architects.”

The home the couple built on-site in Novato was admired by several friends who asked if the couple could build similar homes for them. Thus, a company was born. Having determined she wanted to embrace a modular building method to minimize costs and waste, Kaufmann went on to replicate her own home using prefabricated materials.

Modular homes produce about 50 to 75 percent less waste than site-built ones, which average about 7,000 pounds of waste, said Kaufmann, who likes to quote the fact that few people would build a car on their driveway, so why build a house from scratch on site?

As the business grew, it became apparent that being able to control the whole process, from manufacturing through completion, was essential. Kaufmann hit walls trying to innovate with new approaches or alternative materials. “Most of the factories we talked to had the same mind-set based on high margins and low volume,” she said. “They weren’t interested in discussing creating some crazy new countertop made out of recycled paper.”

So MK Designs took what seemed the obvious step and bought a factory. It was in Seattle, which was close to several other companies they did business with, including a window supplier and a factory that provided them with Forest Stewardship Council-certified wood. “That changed the game for us,” Kaufmann said. “It opened up the ability to design the elements we wanted and to grow.”

The business thrived and, even as recently as last summer, Kaufmann was talking to venture capitalists willing to put up $100 million to help buy half a dozen factories across the United States. But when the economic slump hit the offers of funds dried up.

Today, Kaufmann remains optimistic. She believes MK Designs achieved proof of a concept and that when the economy recovers, more home buyers will be looking for the types of homes she specializes in.

As for affordability, mass-market accessibility was always the long-term goal, but Kaufmann would be the first to admit they hadn’t quite cracked that nut. She says a regular MK Designs home costs about $160-$180 per square foot - and up to $250-$300 per square foot for a customized version. The site cost is not included in those estimates. A typical developer-built house, she says, is at least 10 percent more expensive, but Kaufmann’s goal was to offer more significant savings over a conventional home.

She is also quick to point out what she sees as the flaws inherent in using the square-foot calculator. “Unless you’re paying cash, this measurement is not meaningful,” she said. It also addresses only up-front costs. The utility bills on a genuinely green home immediately translate into significant savings compared with a conventional stick-built home, she said.

Kaufmann is proud of the fact that her work so far has helped spread the word about the benefits of sustainable modular architecture. A fully built mkSolaire model house can be seen on the grounds of Chicago’s Museum of Science and Industry, for instance. Sited in the footprint of a Frank Lloyd Wright Usonian home, the smart home features a solar electric generation system and a living roof. Its purpose, according to the museum, is to “show consumers what the future may bring.”

Kaufmann is in talks with a number of large home-building companies about the possibility of joining forces. She also is keen to work on the creation of well-designed, sustainable communities. “I think we need new models for extended families, co-housing and retirement communities,” she said.

And to those people out there who had hoped to one day build their own Michelle Kaufmann-designed home, the architect said: “Stay tuned.”

Made in America Manufacturing [New York Times]

SCROLL DOWN THE PAGE TO SEE ALL ARTICLES IN THIS CATEGORY.

New York Times, April 23 2009

Michael Goldin, president of Swerve. Photograph by Peter DaSilva , New York Times.

Michael Goldin, president of Swerve. Photograph by Peter DaSilva , New York Times.

In a timeworn factory in Sausalito, Calif., 67 workers turn out Heath ceramics, doing everything from mixing the clay to applying the finishing glazes. Twenty miles away, a Japanese robot called Ziggy works day and night in a converted brass foundry in Berkeley, making precision-cut office furniture.

What the two neighboring factories demonstrate is that it is still possible to manufacture high-quality products in one of the most expensive locations in the United States — even in the grip of an economic recession.

And while both are being forced to adapt to the tough times, the two businesses have been helped by the fact that their products are made in America.

“In hard economic times, a slogan built around ‘Buy American’ is going to resonate a little more,” said Steven J. Davis, a professor of economics at the University of Chicago Booth School of Business. “People read stories about unemployed Americans and they want to feel good when they make consumption decisions.”

Professor Davis said manufacturing was generally moving outside wealthier countries like the United States. “Only an outbreak of protectionist policies or a sharp rise in international shipping costs could slow or temporarily reverse manufacturing’s declining share of employment in the United States,” he said.

Still, there still seems to be an appetite for products from high-end, craft-based manufacturers in America. That proved to be the major reason that Robin Petravic and his wife, Catherine Bailey, bought Heath Ceramics six years ago even though competition from abroad had forced most artisanal potteries across the country to shut down.

They said that when they first walked into Heath’s factory in one of Sausalito’s former shipyards, they decided that Heath’s idiosyncratic way of doing things and its geographical roots could prove to be its salvation. They said they were struck by the fact that every part of the manufacturing process was under one roof. “Many of the employees had worked there for decades and knew everything, including how to fix the machines if they broke down,” Ms. Bailey said.

The company was founded in the mid-1940s by Edith Heath, a ceramicist and creative spirit, and her husband, Brian, an inventor. The company quickly earned a reputation for durable, finely crafted tableware and tile whose clean, modernist lines signaled a break from the more fussy designs of the past.

It would seem at first glance that little has changed at Heath’s dusty, 30,000-square-foot factory in the time since — the tableware and tile are made in the same sustainable, labor-intensive way they have always been. Some lines, like the Coupe pattern, have been in constant production since 1948.

But change has come with the need to make the manufacturing more efficient, cater to the current design aesthetic and respond with agility to the economic downturn. New production systems have been introduced, and dusty pink has been removed from the palette in favor of more contemporary glazing hues like persimmon and cocoa.

In January, Heath introduced a line of less expensive tile. While previously all of Heath’s tile was made to order, the Modern Basics line can be bought off the shelf in a limited selection of colors and shapes. It is about 40 percent cheaper than the custom tile.

Heath’s mix of sales channels has also been adjusted, with wholesale taking a backseat to more direct routes, like the company’s Web site, its factory store and a new retail outlet, which opened in December in Los Angeles. “That’s where we can be most effective and react most quickly,” said Mr. Petravic, a former product designer who developed the business plan.

The factory store, he said, helps them learn which new designs work and which ones do not. It has also reinforced the couple’s commitment to manufacturing in the United States. “We can test the market and avoid suffering from our mistakes,” he said. “If we try something that turns out not to be popular, maybe we have made 100.”

In 2008, Heath’s sales increased fivefold and its profit margin was about 8 percent. The company increased its employee roster to 67 from 25. This year the goal, Mr. Petravic said, is simply to stay flat.

Reinier Evers, founder of Trendwatching.com, which tracks consumer habits, agreed that Heath seemed to be benefiting from consumers’ renewed interest in homegrown products. How products are made is on consumers’ radar, he said. “There’s a story that consumers can tell themselves, or better, the ‘status story’ they can tell their peers to gain recognition.”

Michael Goldin, an architect and industrial designer, has also tied his company’s fate to that trend. For the last 14 years, Mr. Goldin has been contributing to the rejuvenation of a light-industrial district in Berkeley. He transformed an abandoned model airplane motor factory into his office and has designed and outfitted streamlined, open-plan office spaces for lawyers, architects and dotcom start-ups in Berkeley and neighboring Emeryville.

Mr. Goldin’s company, Swerve, has also been making furniture, seeking out the technology required to produce precision-cut aluminum taper joints and machine-tooled, eco-friendly work surfaces for the desks, workstations and shelving systems.

For Mr. Goldin, outsourcing was never an option. “Ever since I was at grad school I have felt very strongly about having my hands in what I am making — actually feeling materials and how they work,” he said. “It all started with my desire to make things and to have a shop where I could do that.”

Outsourcing, he said, would also make it difficult to ensure high design and craftsmanship standards. “How do you keep track?” he asked. “How do you make sure your product comes to you as you specified it? Overseeing the process would require constant traveling back and forth.”

In any case, having Swerve’s pieces made overseas would compromise the company’s just-in-time manufacturing model. “We always make our products to order. We can’t afford to keep items in stock,” Mr. Goldin said. “If we went overseas we would have to order huge inventory ahead of time. And we’re not ready for that.”

The company’s labor costs are kept low because of its reliance on computerized cutting machines, including a new canary yellow robot from Japan, nicknamed Ziggy by the employees, which works 24 hours a day. Of Swerve’s 15 employees, only four work on the shop floor.

In the last few months, Mr. Goldin has had to make some hard choices to ensure that Swerve rides out the economic crisis. A recent order for 500 aluminum-framed chairs will be completed at cost.

He and his administrative staff have vacated the factory’s sleek offices and some income-generating tenants have moved in. And his employees have all agreed to salary cuts. But he believes more strongly than ever that outsourcing would be the wrong choice. “Of all times, we need to do what we can to keep jobs here,” he said.

Both Mr. Goldin and the owners of Heath say they hope what they have achieved will stand as a model for other small- and medium-size businesses facing the critical question of whether to locate production locally or in low-cost offshore sites. As Ms. Bailey put it, “The craft of manufacturing has to a great extent been lost as a value in American culture, and we are striving to retain it.”

Relocation: I’m an Executive, Get me Out of Here [Financial Times]

financial-times-tearsheet.jpg

Financial Times, March 4, 2006

moving-truck.jpg
Last summer I cleared my house out until all that was left were bare floorboards and dustballs and I moved, with my family, to California. I thought I had covered all the bases, as far as you can when you are starting a new life on the other side of the world. We found a family naive enough to want to rent our house and embark on the wretched experience that is school selection in inner London. The possessions that remained after the big cull - 109 boxes of books principally - left Tilbury Docks on a ship bound for the US. We found somewhere to live and a school for the children and, within a few weeks, had settled into the American way of life.

The important things went right. But, of course, there were hitches. No move is without them. The removal company held on to our possessions until we agreed to pay a substantial supplementary bill. They said we had underestimated the volume of the consignment. US Customs refused to release our container because the paperwork wasn’t in order. When the goods were eventually released, my computer’s hard drive had died. A small-print clause I had failed to spot in our insurance meant that we were not covered. With no financial rating in the US, I was denied a credit card, and my US bank froze my account several times, ominously citing anti-terrorism legislation. Oh, and my application for health insurance was turned down.

There were no such irritations for Ian McGeechan, who recently took up the post of director of rugby at UK Premiership champions London Wasps. This involved a move from Scotland, where he was director of rugby for the Scottish RFU, to somewhere within a commutable distance from London. McGeechan handed over the logistics of the move to the Relocation Bureau, a small UK-based company whose clients include Logitech, Amazon.com, Volvo and Cancer Research UK.

The timing of McGeechan’s move south was awkward in that it coincided with him having to be in New Zealand for the 2005 Lions Tour. “As I was 12,000 miles away from my wife, it was comforting for her to know that somebody was responsible for the move,” he says. “The Relocation Bureau co-ordinated everything. They scouted out areas for us to live and narrowed down a selection of houses. They got a good feel of what my wife wanted in a house and, once we had chosen one, they co-ordinated solicitors, builders and so on. They always kept us informed and dealt with all the details - even organising for a new fence to be built around the house before we moved in. I couldn’t have done any of that so it was good to feel the process was under control.”

McGeechan’s move was relatively straightforward, and domestic. But relocation companies really come into their own for globetrotters such as Nico Kelling, a senior manager at Infineon, the German semiconductor specialist. When Kelling moved from his home in Munich to Indiana for the company in 1998 he managed the relocation himself. “I spoke English and it was a short-term post so I just needed to find a furnished apartment to rent, which was easy,” he says. But in December 2005, when Infineon assigned Kelling to Tokyo, they offered him the services of a specialist, Going-There Destination Services. “They carried out a home search and handled all the red tape such as alien registration with local authorities and setting up a bank account. They organised an initial orientation tour of the city and helped with questions I had over a driver’s licence and phone service,” says Kelling.

“The biggest challenge in Tokyo is the language barrier, so it was time-saving to have help, particularly on the negotiations relating to my rental contract, which would have been more difficult to do alone.” He adds that he suspects having a Japanese-speaking expert on hand probably also widened his choice of places to live. “My options would have been limited to apartments with landlords who spoke English had I been looking on my own,” he says.

Linda Behnke, a partner at Golding Capital Partners, is a serial globetrotter. She relocated four times in 10 years for a previous employer, flitting between Munich, New York and San Francisco. Each move was managed by Mobility Services International, a company that claims to “demystify relocation”.

“They handled all aspects of the physical move,” she says. “I was very happy with them so used them every time.” Nevertheless she says each move was progressively more difficult. “This is partly because you amass more.” But the more angst-inducing aspects were out of her - and the relocators’ - control. “Every time we moved, the removal company underestimated the fee. I think it’s because they are aware that there are other [higher] bids and they figure they can’t lose as they will just change the price later,” she says.

Linda says each move has resulted in breakages, although they have all been covered by insurance. She also underwent the heart- stopping experience of $50,000 “going missing” as it was being transferred between her European and US bank accounts. Only dogged persistence on her part in getting the banks to tackle the problem - and the paper (and e-mail) trail she had kept of all her correspondence on the matter - resulted in her funds reappearing five weeks later. Her advice now: find a bank that is accustomed to dealing with ex-pats and clients on the move.

Having learned the hard way, Linda has two more tips for those relocating: “The move will always cost 20 per cent to 25 per cent more than you think it will and the consignment will always arrive later than promised,” she says.

These days, in a pressure-cooker global career market where a senior executive might be assigned a new post with as little as a week’s notice, corporations routinely offer the services of a relocation company along with the transfer orders. Big multinationals move between 1 per cent and 4 per cent of their employees around the world every year and turn to relocation specialists such as Cendant, Prudential, Sirva and Weichert to help them do it. Many of the these behemoths include removal companies and real-estate networks in their corporate portfolios.

The benefits offered in a relocation package differ from one company to the next, and are negotiable depending on the seniority of the employee, the degree to which the corporation wants to retain him or her, and the perceived “hardship” factor of the move. Along with the task of physically moving a household and its contents, services may include assistance with selling an existing home, identifying suitable neighbourhoods and schools, as well as financing a home purchase in the new location. Orientation services may include guidance on setting up bank accounts and getting connected with local ISPs, access to on-the-ground agents with local expertise, as well as “spouse support”, which might include information on local job resources or educational courses.

Companies engage relocators with one main objective: to move an employee swiftly and with the minimum amount of upheaval, so that they are at their desk and functional as soon as possible. “From a company viewpoint, the employee is at work working rather than house hunting, school hunting, or putting up pictures,” says Craig Vassie, a partner at The Relocation Bureau. Or, as John Arcario, executive vice-president at Cendant Mobility, puts it: “If somebody is moved without a relocation expert it’s the employer that suffers because you end up with a distracted employee and a potentially unsuccessful move.”

Chuck Stewart, client services director at Going-There, says cost- cutting has had an effect on the nature of the perks offered by corporate relocation. Increasingly, advantages such as the employer buying and selling-on a home, bridging loans and compensation for a spouse’s lost earnings are reserved for the “top brass”, he says. And some companies are choosing the self-help option. “There’s a trend for companies to give employees a lump sum and tell them to manage the move themselves,” he says.

There is no average cost for a relocation. Variables such as the value of an employee’s home and his or her seniority all play a part. The Relocation Bureau charges about £5,000 to relocate what it terms an “executive family”. At the other end of the scale Arcario estimates that the outlay for a multinational moving a senior executive with expensive housing requirements from New York to London would be well in excess of the value of his or her annual salary.

It is not just the corporate world that hires relocation companies. Two years ago the University of Southampton introduced relocation services as part of its staff recruitment policy. “We wanted to attract the best staff from wherever they were based geographically,” says Zelda Franklin-Hills, the university’s head of staff diversity. “It is stressful moving to a new job and it makes sense to offer support to ease those pressures so new staff can settle in and contribute to the university quickly.” Franklin- Hills has also observed how an offer of help with relocation can make the difference between a faculty member accepting a post at the university or elsewhere. “It can be the deciding factor between one job and another,” she says.

Although it is difficult to see how having expert guidance cannot be beneficial for people on the move, there are times when relocation companies can be more of a hindrance than a help. This proved the case for one family who moved within the US last year. The non-profit organisation for which the husband is a director selected a relocation agent, ostensibly to work on the family’s behalf. The agent was to sell the family’s existing home and help them find a new one in the city they were moving to, as well as manage the bridging loan provided by the husband’s employer and oversee the transportation of their goods. However, because the agent was overseeing the financial side of the move, which directly implicated the employer, the family didn’t feel their interests were being best served.

The relocator also appointed a real-estate agent based in a town 20 miles from where the family wanted to live. Feeling he lacked the local knowledge they needed, the family had to negotiate to select their own realtor. “There were times when we seriously thought about getting shot of the relocator,” says the mother of the family, who would rather not be identified, “even if that meant sacrificing the benefits that were being offered, such as the loan to buy a new home.”

In the end, though, a good experience with a relocation company can mean the difference between a successful move and one that flounders or fails. Had I been forewarned about consignment size, credit ratings and how to fill in a health insurance application, I may have avoided some of the headaches of my move.

The value of having someone on hand with local expertise is also repeatedly cited by relocation companies and those who have used them as being critical to a smooth transition. “You might be moving to the Bay Area in California, but do you know which neighbourhoods have the right schools for your children, employment possibilities for your spouse and like-minded communities to live in?” says Arcario at Cendant Mobility.

Meanwhile Vassie at The Relocation Bureau recalls a case of an American executive who was moving to the UK for her first overseas posting for a large multinational. “She was being helped by US ‘counsellors’ based in Connecticut,” he says. “As she needed to be within reach of Heathrow and a factory in Peterborough she was advised to live in King’s Cross.” It was a few years before the current regeneration scheme, and “it took us a while to persuade her that living next door to pimps and drug addicts wasn’t exactly a good idea.”

Donald Gunn: A Need to Measure Success [Financial Times]

financial-times-tearsheet.jpg

———————————-
Financial Times, May 11, 2004

———————————

gunn.jpg

Never underestimate the importance of awards to the advertising industry. Anecdotes abound of the lengths agencies will go to to secure a prize. One French network promised each of its creative directors a share in a €1.5m ($1.77m) bounty if their work made it into one league table, and a Brazilian agency chief ordered his creative team to come in at the weekend “so that they could do the ads for Cannes”.

In some quarters there is a cynical belief that certain campaigns are created with a view to winning awards for agencies rather than driving sales for clients, or that competition juries favour big-budget and cutting-edge campaigns with which mainstream viewers are rarely familiar. None of which will, of course, prevent the industry’s creative tribes from descending on Cannes next month for the Golden Lion advertising awards festival, the industry’s equivalent of the Oscars.

Donald Gunn knows more than most about awards. Once dubbed “the man with the best job in advertising”, Mr Gunn, who spent three decades at Leo Burnett, has latterly dedicated his career to analysing creativity and tracking the best-regarded advertising and the agencies or countries which produce it. The results appear every November in the Gunn Report, probably the most respected, and certainly the best-read, measure of excellence in an industry obsessed by rankings.

So, to what does he attribute this compulsion to be honoured? “In every field there is an appetite to be the best and for that to be celebrated,” he says. He concedes that, compared with other creative industries such as music or design, advertising has a disproportionate number of awards. But their role in powering the business is fundamental, he says.

For agencies, awards create a virtuous circle: they establish reputation, attract talent and bring in new business. Even so, Mr Gunn believes they should be seen only as the icing on the cake. “Agencies should set out to create the best advertising for their clients. Winning an award is a bonus.”

The benefits may not be so obvious for advertisers. “Awards are not a priority for advertisers, but they do want the best, most original advertising, so an award provides reassurance: they are getting good work and they have good people at their agency.”

Mr Gunn has also examined the relationship between creativity and effec tiveness and has proved to his satisfaction that award-winning advertising increases market share. A study of 400 of the most-awarded campaigns in the world between 1992 and 1995 found that 86.5 per cent of the ads were associated with market success. In other words, ads with award-winning qualities were two and a half times more likely to achieve, or surpass, clients’ objectives. Leo Burnett reprised Mr Gunn’s study in 2002 and unveiled similar results: four out of five award-winning campaigns achieved positive market results for clients.

Mr Gunn’s insights stem from his experience as an agency creative chief and from the phenomenal databank that forms the backbone of the Gunn Report, launched in 1999.

While at Leo Burnett, Mr Gunn founded two institutions that still set creative benchmarks today: the Great Commercials Library, started in 1986, and the Global Product Committee. The latter involves a commitment that many agencies would find daunting: every three months, 20 of Leo Burnett’s top creative staff from around the world meet for a week to view the entire network’s output. Ads are scored and feedback is given.

To compile his report, Mr Gunn combines the winner lists from 52 national, regional and global award schemes (32 for television, 20 for print). But, just like Coca-Cola’s secret recipe, he has never revealed which ones they are. He says this is to avoid harming the contests that are not included (though it also makes it impossible for agencies to challenge the rankings). After much data-crunching, the league tables emerge - including top commercials, top agencies, top production companies and top countries - as well as a Showreel of the Year featuring the 100 most-awarded campaigns in the world.

Given Mr Gunn’s influence in the industry, one wonders if his rankings have ever been questioned, or if he has been offered incentives to skew results. “Much to my amazement nobody has ever seriously challenged the tables,” he says, “although there have been the usual queries about methodology”. A US network once hired a headhunter to find out which awards had made it into the report; it failed.

“There was a theory at one point that if you threw money at the awards and entered the maximum number of shows, you would come out well,” he says. “In fact, the agencies that spend the most are often those who are entering mediocre work.”

He has his own view about what makes an award-winning ad. He believes an agency’s shared vision and passion for good work - as well as a willingness to take risks - are more important than incentives (such as bonuses), or even strong leadership.

He has identified 12 “master-formats” which, he says, are a good starting point for delivering a selling idea in an engaging way: “Sitting down with a blank sheet to create an ad can be a lonely, scary process.” Approaches such as the testimonial or the celebrity endorsement can dramatise a proposition. Mr Gunn will flesh out his master-formats concept at a presentation in Cannes this year.

Mr Gunn has also spotted a welcome rise in creative standards across the world. “Three years ago, there were 22 markets represented in the 100 best commercials reel. Last year there were 28. Countries such as Canada, Mexico and India are moving up,” he says. Australia, he notes, has regressed since its 1980s heyday, while China has improved as Hong Kong talent has moved into Shanghai and Beijing.

This year, Mr Gunn is handing on the bulk of the work involved in compiling the report to his sister-in-law and brother-in-law. But, before then, he must complete possibly his most ambitious project to date: an online library of award-winning advertising he has tracked since 1962. “It will deliberately be the smallest online commercials library because it will only feature the best - and all the best - ads from around the world,” he says. The Gunn Report Library will be launched by BEAM TV this summer.

Mr Gunn claims he is taking it easy, but his diary tells another story. He has just returned from an advertising conference in Argentina, and later this year will attend festivals in Asia and eastern Europe, as well as Cannes. For this “awards supremo”, it is business as usual.