Mike Lipper’s Monday Morning Musings
Inconclusive Week Hiding a Big Problem
Editors: Frank Harrison 1997-2018, Hylton Phillips-Page 2018
4 Day Summer Week
Two days of limited stock price gains and losses, with more stocks falling than rising. Market chatter was focused almost exclusively on the Israel-Iran war, with no Fed interest rate change. As usual from a long-term investor’s standpoint no attention is being paid to the continued destruction of the fundamental case for long-term investing. (Not surprisingly, this week’s American Association of Individual Investors’ (AAII) sample survey showed a shrinking six-month outlook for the “bulls” and an expanding negative view of the “Bears”.)
We have probably measured human productivity in business and
non-profit organizations, including in academia and health care, since the beginning
of human activity. Top-down, it has been declining for some time. To find the
wasteful culprit accountants assigned organizational revenues and profits to
various individuals. This was easy to do for front-line workers and senior
management, but the middle of every organization was left out.
Left out were the human supervisors, often labeled foremen
or middle management. In a period where top-line growth has slowed toward
population growth, there is increased concern about human productivity levels. Since
the swollen middle was not directly considered revenue or profit makers, their percentage
of the workforce shrunk. As a society we are now paying the price for this lack
of understanding of this value creation.
In far too many cases the supervisory class were the main
purveyors of organizational culture, responsible for producing
customer-oriented quality. There are hardly any organizations which have not
experienced a decline in quality from the users’ point of view.
We are about to pay a higher price for this hollowing-out
process as new activist management, particularly from the Washington quality
culture, becomes a reality. This is especially true as thruput per person
becomes the mantra and “AI” and other statistical measures are being
implemented. With new activist leaders in Washington, I am worried many
government and academic services will decline and to some not add value.
As fellow consumers, please share with me any services you
receive from organizations that have improved recently.
Note: At this point we doubt the bombing of the nuclear sites
in Iran will change much long term.
Did you miss my blog last week? Click here to read.
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