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Welcome to this week's edition of The Chicago Brain Trust, "a humorous
look at the Chicago-area's e-business community." Starting today, we'll be running the newsletter's content on the web site with a one-week delay <http://chicagobraintrust.com/<;. (For the investor, that means you're a week behind if you read the archive on the site. Keep it current and subscribe.) As always, if you're looking for our signature cartoons, boogie on over to <http://chicagobraintrust.com/retinalimages.htm<;, and while you're at it, check out our fine selection of daily comic strips at <http://chicagobraintrust.com/comics.htm<;. And now, on with the show... -Todd Allen Chief Executive Smart-Ass The Chicago Brain Trust ============================================================================== == Warning: There is no truth in any of the materials in this newsletter, except by satirical inference. ============================================================================== == McDonald's Acquires Failed Web Firms, Sends Employees to Burger U. (Oak Brook, IL) Fast food giant, McDonald's has entered the dot-com world with a big splash, acquiring failed web firms at a breakneck pace. Not an ordinary technology investor, McDonald's is taking a corporate raiding approach to these acquisitions. Instead of utilizing acquired firms to increase the corporation's Internet presence, McDonald's is taking a new spin on the increasingly popular "Vulture Capital" role, selling off patents and equipment, while retraining the acquired staff. "Getting employees that can make correct change and process orders properly is much more difficult than one might imagine," McDonald's spokesman Harrison Dent explained. "There's also the issue of convincing qualified teenagers that McDonald's is a cool place to work. It all makes staffing very difficult for us. We've found that most web programmers have sufficient mathematical skill to make correct change, as well as handle the digital read-outs on microwaves and French Fry machines. With the economic problems many web firms have been having, compared with the cost of constantly recruiting new teenagers and replacing them as they go off to college, it has become economical to simply acquire a struggling web firm, sell-off whatever assets they have, and send their staff to Burger U. for retraining in the business of family dining." Dent went on to say that the various positions at web firms mapped out well with McDonald's staffing matrix. Programmers, being mathematically inclined, would process the customer orders and make correct change. Quality assurance workers are sent back to the kitchen, making sure each burger they flip is up to corporate standards. Technical support makes sure the grills and fryers stay in working order and that the floors are clean. Managers continue to manage and accountants still do the books. "Initially there were concerns that, due to the large number of foreign programmers, that there might be some language problems with these workers taking orders. However, upon execution, it was found that the problems with poor English skills were no greater than those currently existing in our Chicago operations." McDonald's largest problems in converting employees seem to be dress code and unauthorized snacking. "Unfortunately, the casual dress codes allowed at some of these firms have caused a culture clash," Dent elucidated. "We have had some issues with employees showing up to work in dirty t-shirts, rather than in a McDonald's uniform. Similarly, many of the acquired firms provided free and unlimited snacks and drinks, a policy which is not a staple of our organization." Still, Dent was upbeat about the prospects of transitioning the digital economy to the burger economy. ********Advert************************************** Want to laugh at something besides business? Indignant Online... because ATTITUDE matters http://www.indignantonline.com ...we have sports, too ********Advert************************************** Brain Dead The Next P2P By The Big Head In the battle of acronyms, the first P2P was path-to-profitability. Then we had P2P as in peer-to-peer. Though no one really knows if this is Napster type P2P (central server based) or the SETI type P2P (distributed computing). Regardless, the next P2P will be Private-to-Public, as in private-to-public exchanges. The beginning of the B2B revolution was led by public "exchanges". While the exchanges were nothing of the sort when one used to think of true exchanges (Commodities, Futures, NASDAQ, NYSE), they did expose the public to the Internet space. These "exchanges" as they were called were really nothing more than glorified auctions. There was no exchanging going on because that is not what they were designed to do. The idea of these early companies was to build a technology and then leverage the power of the Internet to create buying communities. Whether it was buyers or sellers, the premise was the same. If the company chose to work on sell side mechanics, then it was usually excess inventory of some sort put out into a platform where the highest bidder was the winner. Conceptually, this was a good idea. However, it was fraught with a few challenges. First, you needed lots of buyers to attract the sellers, and vice versa, thus liquidity was an issue. Second, none of these technologies took into account a payment mechanism or payment platform, thus all settlement issues were handled offline. While this may have been fine in modern times, the premise of the Internet was to help eliminate such paper and time-based inefficiencies. If the company chose to work on buy side mechanics, then a buyer would list his request and suppliers could jump at the chance to bid for the opportunity. This, as well, brought about it's own set of challenges. Namely, the suppliers, who were necessary for the validity of the auction, stayed away. The figured it out pretty quickly that they would only be bidding against themselves and their own margins. Thus without enough suppliers, you had no liquidity. Where is the industry now? On the "Private Exchange" model. What the industry failed to take into account was the value of RELATIONSHIPS. The relationship between buyers and sellers is a long term and trusted item. Some relationships go back a hundred years. Take Ford and Firestone for instance. That relationship has been in existence since the dawn of the automobile. You don't just build a technology and expect to steal those existing bonds away overnight. Therefore, the premise of the public exchange is to leverage the existing relationship between the buyers and sellers of companies, industries and verticals. The companies are saying, give me a better way to deal with my own suppliers. I trust these companies, I know them, I know their pricing, and their deliverables, heck, I play golf with their CFO. I want to keep them. However, I want to do it more efficiently. What can technology and the web do to make my life easier in dealing with the known quantities that exist within my own company realm? So now, the push is to private exchanges. A way to take big companies with hundreds or thousands of existing relationships and bring them to the web. This creates immediate liquidity among groups of companies used to doing business with each other. That makes sense and should be where the market focus was all along. What will the evolution of this be? That is where the new P2P comes in. What is P2P, you ask? Private-to-Public exchanges. While a private exchange focuses on existing customers, a public exchange holds the promise of more buyers and sellers. Thus, more liquidity creates potentially more sales or more savings. Ask yourself, "If I were a company would I be interested in new buyers and sellers for my goods?" Invariably, the answer is yes. A private exchange automates my existing relationships. However, find a way to provide me access to more buyers and sellers as well, and know you really have my attention. Where is the future of exchanges? It should move toward a private-to-public marketplace. First, make it easier to deal with my existing customer and supplier base. Second, give me more buyers and sellers for my goods. Whether this means a melding of the different private exchanges in the future, or several overlying technologies that provides access across many borders, is yet to be seen. I'm willing to bet the future of B2B commerce will lie somewhere in the neighborhood of the new P2P. ********Advert************************************** What?!? You haven't subscribed to The Chicago Brain Trust yet? Get with the program, click here: http://thechicagobraintrust.com/subscriptions.htm Enough, already! ********Advert************************************** New Tissue Headlines of the Week - May 23, 2001 (Chicago, May 21) NEWS FLASH! The McKinsey Report Does Exist! In a brilliant piece of skullduggery, CBT staff members, Luke N. Forlove and Little Debbie, were able to penetrate the $50 million dollar security screen erected around Katherine Gehl's office and copy the entire document. "Well, we kinda waited 'till she went to lunch and while Luke distracted her assistant with his masculine charms, I copied the entire 25,000 page document on my Brownie camera," Debbie revealed. While we intend to release the document piecemeal to obviously milk it for all it's worth, here are the names of some of the various Chapters, just to whet your appetite: "Intro - Boy Do We Have Problems"; "Chapter Two - No Silicon Found in Prairie"; "Chapter Five - divine Should Consider Software Approach"; "Chapter Nine - Tech Jobs Not as Important as Broadband Plays"; "Chapter 13 - Horse Racing Revenue Possible Funding Source"; Chapter 42 - More MBAs Needed". Starting next week, we intend to publish actual material from the report, so don't miss our next issue! (Chicago, May 21) Microsoft Misses Boeing - Heads to Chicago Too. In a surprise announcement, Bill Gates, Microsoft guru and founder told the press that he had decided to move the company's headquarters to Chicago. "I was shocked an surprised to see that Boeing moved, but then I checked out their rationale and concluded they were right," Gates said. Pointing to a PowerPoint presentation that no one could decipher, Mr. Gates remarked: "After all, when you take into account, climate, available human resources, the transportation capabilities, it's a no-brainer." Sources close to Gates indicated that when Bill found out that the Playboy Building was available, he jumped at the chance to move. It's rumored that Bill has visions of taking on the mantra of Hefner now that he's stepped down as CEO of the world's largest software company. (Evanston, May 22) Northwestern University's Mohan Sawhney Makes Internet Prediction that Comes True! Yes, that's right, Professor Sawhney has actually made a prognostication that was borne out! Last week the Professor predicted that Microsoft would move to Chicago. "After all, when you take into account, climate, available human resources, the transportation capabilities, it's a no-brainer," Sawhney cited at a meeting of Internet gurus. Sources close to Sawhney said that when the Professor heard that the Playboy Building was available, he easily made the prediction. "Business is all about collaboration, work flow and relationships. And who was better at relationships that Hugh Hefner. If Mr. Gates can pick up where Mr. Hefner left off, Microsoft should be a winner." Sawhney said. In a related story, a spokesperson for Viagra was heard to remark, upon hearing the news, "If Bill uses the Hefner model, he'd better stock up on our product. After all, if Windows were a man, not only would there be performance problems, but shutting down in the middle of a session is just not going to cut it. Others in Chicago said that perhaps that was the real reason for the move. "Maybe moving to the Playboy Building will inspire them to create products that get issued to the public prematurely. Premature issuance is a real problem, especially when, well, you know," a local government official was quoted as remarking. Most Chicagoans felt that that least the Windows wallpaper would likely be a bit less dull in the next Windows product line should Gates be ensconced in town. (Chicago, May 23) Britannica and Online Unit to Combine - Move Books Through the Internet. Citing the slower sales of the paper-based encyclopedia and the struggling revenue model for their e-commerce site, Britannica spokesperson Winston Miles said: This will really cut down on expenses. All we have to do is figure out how to stuff those heavy books through the wires and we'll really show some progress." Sources close to Britannica's president say that when he heard that "broadband" was now widely available, he said, "OK, so if it's broad enough, then the big fat book should fit, right?" ********Advert************************************** The chicks that run this site are always bugging me for coverage: http://www.pinkslipparty.org/ Satisfied, girls? ********Advert************************************** Shock Therapy Digging Through the Archives - Do You See A Pattern Here? By I.P. Daley Editor In Chief Hello fellow CBT'ers. I'm a bit more lucid this week, having been allowed a lesser dose of my medicine - and while my frontal lobes are clear, I took some time to visit the hospital's library. You would be so surprised to see just how many things were collected ON PAPER before the Internet reared its ugly head. The facility actually has a wonderful collection of old newspapers - yes, a paper document where content was placed on a daily basis and - you'll never believe this, dear readers - people actually paid to read it! Really! I'm not kidding! Anyway, what I found enervating was that there were real-life stories in these newspaper things, you know something called "news" that didn't entail a wonderfully endowed woman or a plastic faced man to interpret it for us. Think of this crude idea; a person called a "reporter" went to the site of some "news event" and - now I know you won't believe this - wrote down the FACTS! Then, and this is even more fantastic, the "editor" (a person who actually read all the written down stuff to see if it made reading sense) let the reporter person put it in the paper exactly like it happened - he didn't need to "spin" it or check with the advertisers first! WOW! No wonder newspapers have ceased to exist. But I digress. The article I snipped out of the paper seemed vaguely familiar to me, but I couldn't place it. No problem, I called Mohan Sawhney, my old buddy at Kellogg (If he's at Kellogg and he's so famous, why is it, he's never been on the Corn Flakes box?) and asked him if he could make the connection for me. After 1 hour and 45 minutes of phraseology like: "Strategic Insights into eBusiness Transformation", I thanked him and rang off. While he didn't provide further illumination, he did tell me that Kansas was in the Midwest. Rather than try to figure it out myself, I decided to let you, the reader, provide me with clues to why this tickled my subconscious. Please let me know, as I have to go back into confinement and won't be allowed back into the library until July 17th 2003. All e-mails should be sent to ipdaley@thechicagobraintrust.com. Kansas Sun-Times Hullabaloo Kansas, Dec. 19, 1903. For Produce Farmer, Automobile Failed Against Horse and Wagon For 3 generations Samuel L. Ross's family has adopted the latest technology to keep their farm's production at the head of the class. "Everyone here abouts knows my father was the first to buy a Deere reaping machine back in '73," he was quoted as saying during our recent interview. But there's one thing you won't see on Ross's farm - any of those new fangled inventions called the automobile. "That new fangled horseless carriage isn't going to cut it when it comes to getting my produce to market." Ross said while standing along side his farm wagon and team of horses. "Why the dang thing needs gasoline every 10 miles and it only hauls ton, compared to 2 ton I can fit on my wagon. Even worse, it scared the dickens out of Joe Roy's filly." Ross said he was approached by Ransom E. Olds last year and talked into purchasing an REO Speed Wagon to use to move his produce to market in Salinas, over 20 miles away. Eager for a competitive advantage, Ross jumped at the change to try the auto. But shortly after he purchased the horseless carriage problems came up. "They didn't tell me you needed gasoline to run the dang thing - hell I've got lots of oats, but I got to go into Salinas once a week to get 50 gallons of that stuff. Then I learned it's even more flammable than kerosene, I can't keep it anywhere near the stove!" Sam went on to say that the REO needed things like a "tune up" and "spark advance" - things he wasn't qualified to do - so he needed to hire a "mechanic". "Hell, if I'da known that, I'da never bought the thing." Seems that the idea behind the auto was wrong. Olds invented the speed wagon for smaller deliveries in towns like Salinas, and when he tried to sell it outside of town, it just didn't catch on. In fact, Olds has left the truck business and is concentrating on carriages for homeowners. "Hell, he'll fail even faster with that model," Sam said. "No way families are going to use that." But all is not lost, Sam's been approached by a gentleman named Francis E. Stanley, out of Maine who is trying to sell Ross a steam powered wagon. "Now I'm really considering that," he said, "Steam - that's a proven technology - just like my tractor and all them locomotives." Next week, Sam is taking delivery of the steam wagon. "The automobile is dead, but this here steam wagon, now that's the future. You know, taking proven technology and applying it to something else." In an unrelated story, Orville and Wilbur Wright had the audacity to announce that commercial air travel will be the norm in less than 50 years - this after their "flight" of 120 feet in South Carolina this week. ********Advert********************************************************** SITEVSIONS.com - WEB DEVELOPMENT AT REASONABLE PRICES If you are a small to medium-sized company and you are looking for an entry level or a medium-sized website at a very reasonable price, contact us. We offer all major development tools and a full line of products such as e-commerce shopping cart development, auction software, bulk e-mail, and we have these products priced aggressively. Our websites begin at $2,500 for a starter site and run up to the low six figures for huge, robust e-commerce applications. See sample work at: www.sitevisions.com/2001/portfolio.htm Contact us at sales@sitevisions.com or call 312-364-9438 x 224. ********Advert********************************************************** This has been a production of the Chicago Brain Trust. All materials are copyright 2001, The Chicago Brain Trust, all rights reserved. For more mayhem, visit the Chicago Brain Trust at http://www.chicagobraintrust.com ====================================================================== Your e-mail address [whalley@enron.com] is in our mailing list. 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