Phil Hauck's TEC Blog

Saturday, July 2, 2011

Short Items ...

Retirement Savings: It's About Leadership!
Worker retirement saving is actually dropping, not increasing ... even though regular savings rates have skyrocketed.
According to the Employee Benefit Research Institute, during the 2009 recession, 35% of workers weren't saving anything for retirement. Now 41% aren't. Of workers offered a retirement savings plan at work, 21% don't participate, up from 19% in 2009.
If leaders promote it, workers will do a better job.
Good News: What's coming is the Auto-IRA ... a required vehicle in which every worker will put savings, matchable by an employer if desired, starting with your first real job. It'll be YOUR ACCOUNT, with investments directed by you from a limited selection, available to you when you retire. (A worker can "opt out," but if he doesn't, it applies.) No, it won't be an option. It will be government policy in a year or two ... as the supplement/replacement(?) for social security. Thanks to Michael Kiley, CEO of PAi, DePere, who has been part of the DC group developing it.

Oil & Gas Industry Tax Breaks
There has been controversy about whether deficit reduction should include these. But what are they? Fortune magazine explains:
"For example, they are allowed to deduct 'intangible drilling costs' -- including labor and drilling fluids - the moment a well is tapped (even it proves to be dry). And then there's the 'depletion allowance,' which allows certain extractors to shelter around 15% of a well's production from the IRS. And deductions for royalties paid to foreign governments. And the oil and gas liability cap that remains at just $75 million, more than a year after the BP rig explosion. Then there's Section 199, which allows profitable oil and gas companies to deduct 6% of net income."

The World's Power Is Shifting Fast
In the last two decades, "more than 2 billion men and women have joined the ranks of industrial producers, trebling the size of the world's industrial economy. This year, for the first time in history, both America and Europe are being outproduced, out-manufactured, out-exported, and out-invested by the rest of the world. The corollary of this change is that the next 20 years will also see another worldwide revolution, this time in consumerism, and it will be dominated by Asian workers, who will treble the world's middle class."
--- Gordon Brown, writing on

Your Strategic Positioning Statement

In eight words or less, you need to tell:
1. What you do.
2. What's in it for your customers.
-- Simon Mundell, Vistage Speaker


Here are Apple's "steps of service" for employees of their Apple retail stores:
A: Approach customers with a personalized, warm welcome.
P: Probe politely to understand all the customer's needs.
P: Present a solution for the customer to take home today.
L: Listen for and resolve any issues or concerns.
E: End with a fond farewell and an invitation to return.
(WSJ, 6/15/11)

Increased Choice ... not Decreased Choice!

"When given real choice, especially the choice to go elsewhere, consumers will drop even the most beloved of brands for options that enhance their experience and increase their autonomy. We have all witnessed and participatedin this revolutionary transfer of loyalty away from those who tell us what we should buy or think (monopolists) and toward those who give us tools to think and act for ourselves. No corner of the economy, of cultural life, or even of our personal lives hasn't felt the gale-force winds of this change.
"Except government.
"At a time when governments at every level have run out of money, the smart politicians will figure out how to unbundle policy options and speed up the sort of innovations that has made most areas of our lives better than they were 40 years ago.
"And the dumb politicians? They'll go the way of Kodak."
-- Nick Gillespie, Matt Welch, Wall Street Journal (6/18/11)

Outsourcing/Global Trade: To Be Embraced

Congress keeps getting askew from the understanding that trade and outsourcing is fairly critical to income growth. Perhaps not enough people truly understand why.

Two points: First, we can not easily increase the net worth of an area (say, Brown County, Northeast Wisconsin or Wisconsin) by selling to our fellow citizens within it. We best increase net worth by adding value to our products here and selling them to people outside our area (the U.S. or globally), and bringing that value added payment back to us. It can then be spent to increase our quality of life, or be reinvested in the form of higher wages and more jobs. So, it is imperative that we sell globally. Today, 8% of Wisconsin's jobs are due to global business (16% of manufacturing jobs). That's why we need free trade agreements with other countries.
Second, reflect back to the Law of Comparative Advantage that you learned in economics. Other countries now have greater skills and lower costs than we do in producing some types of goods needed globally. That's how and why they are growing and creating jobs. We are berated for "outsourcing" these jobs. They have a "comparative advantage" which "logic requires" that the work be done by them. Our charge is to develop skill and cost levels that "logically require" "in-sourcing" into Brown County, Northeast Wisconsin and Wisconsin. That's why NWTC and job training tax credits/grants are so important. Arguing for protectionism is counter-productive; it creates retaliation and reduced value, which we see time and time again.
This is one area where government spending benefits society ... by re-training employees to be better able to compete in the next era.

Green Bay ranks 121 out of 188 in Gallup's Well-Being Index

Boulder, Colorado, got a lot of publicity recently as being the nation's #1 Happiest city based on an ongoing Gallup Poll that rates attitudes and lifestyle behaviors to create a Well-Being Index. Boulder's main behavior that got them the #1 ranking was its citizens' commitment to fitness activities ... an active lifestyle whether intense or just fast walking.
So, where does Green Bay rank? It is ranked: #121 out of 188 cities. Madison was #6, Milwaukee #103. In 2009 we ranked 104.
Here's how we did:
2010 2009
Overall Rank 121 104
Life Evaluation 179 149
Emotional Health 23 33
Physical Health 52 25
Healthy Behavior 124 84
Work Environment 127 148
Basic Access 8 52
What dragged us down, obviously, is Life Evaluation. Here's how that is defined: It's a self-evaluation of two items: Present Life Situation, and Anticipated Life Situation 5 years from now.
Work Environment: Perceptions of four items ... job satisfaction, ability to use one's strengths, supervisor's treatment, and supervisor creates open/trusting work environment.
It would appear that our companies need to work on creating an improved work environment focusing on engaging and empowering employees.
It publishes its national index monthly.
For more information: