The California Consumer

Why aren't Southwest and Spirit Airlines Aboard with the new Truth-in-Advertising Rules?

2012-01-27T09:30:00.001-08:00

This week, Ray LaHood, the Secretary of the United States Department of Transportation, announced new rules that require domestic airlines to include all taxes and fees in airline ticket prices. These new rules are common sense and are good for consumers.

Surprisingly, Southwest, Allegiant and Spirit Airlines are resisting this “truth in advertising” policy by suing the US-DOT over the new rules. The airlines are arguing that the new requirements make the rules for the airline industry more stringent than any other. That’s utter nonsense! The fact is consumers are fed-up with the airlines lousy service, unfair pricing rules, non-disclosure of upfront costs for baggage, meals and ticket changes. This is why Secretary LaHood and US-DOT should resist any changes to their new rules. Consumers deserve honesty and full disclosure from the airlines.

Frankly, I’m surprised by Southwest Airlines’ involvement in the lawsuit. As one who regularly flies Southwest, I think it might tarnish their otherwise sterling reputation. Southwest Airlines has been an industry leader and a role model for domestic airlines in many ways – their consistent profitability, a very strong safety record, low fares, free baggage, customer-friendly flight attendants who know how to make passengers smile and laugh during the safety announcements, and the most user-friendly website in the industry, bar none.

On the other hand Spirit Airlines has earned a reputation for nickel-and-diming its passengers for everything! So, their position in the lawsuit is understandable. They want to continue to lure prospective passengers onto their website by disguising low fares before hammering them with various fees and charges after passengers have purchased the ticket. These are the very types of unfair pricing tactics that Secretary LaHood is trying to stop.

In fact, Spirit Airlines and AirTran Airways, which is owned by Southwest, were fined a combined $90,000 for violating the pricing rules in advertisements such as emails, tweets and on their websites. Allegiant Airlines was fined in 2009 for not including a convenience fee in initial fare quotes. Need I say more?

The airlines have had their way for too many years. They have consistently practiced unfair and devious pricing schemes to lure passengers onto their flights and making record profits in the process. But, a growing number of complaints by consumers prompted the U.S. Department of Transportation to implement new rules which are based on fairness, truth-in-advertising and full disclosure. Frankly, these new rules are long overdue and the airlines ought to quit their pouting and do the right thing by consumers.

The turbulence surrounding the new Department of Transportation rules amounts to little more than belly-aching from the airlines that must now be honest and forthright with consumers. It’s one more reason why a strong government watchdog agency like the U.S. Department of Transportation is necessary. Without such rules in place, airlines would continue to use unfair pricing tactics and unscrupulous methods to lure travelers onto their planes. Am I exaggerating? Not at all! Just read what the lobbying group, All Airlines for America (A4A) stated in the legal brief they filed with the D.C. Court of Appeals in support of the lawsuit by Spirit, Allegiant and Southwest Airlines.

In its legal filing, A4A said, "ATA members share DOT’s stated objective of ensuring that customers are treated fairly and consistently, receiving the products and services for which they have paid on the basis advertised to them. But ATA members do not share DOT’s unstated, but apparent, goal of holding airlines to much higher standards of conduct than prevail in other deregulated industries."

In other words, the airlines don’t like being held accountable to the same common sense practices and fairness standards that American consumers expect from every other industry. Are you kidding me? And, remember, folks this is the same industry that has gutted its workforce, stripped its talented and dedicated employees of fair wages and benefits and moved to decertify its unions. No wonder consumers are frustrated and outraged at the questionable pricing practices used by so many of our nation’s airlines. Perhaps, the airlines should simply mind their Ps and Qs and be lucky Secretary La Hood isn’t pushing for re-regulating the airlines!

About the Author:
Thomas Hinton is president of the American Consumer Council, a non-profit consumer education organization with over 120,000 members. He can be reached at tom@americanconsumercouncil.org

American Consumers Will Continue to Drop Banks for F.E.E.S.

2011-11-07T09:55:00.000-08:00

by Thomas Hinton

In an era when consumers are frustrated with Wall Street and big banks, it’s not surprising that more than 675,000 people responded to the social media movement known as Transfer Day to drop their banking relationships in favor of credit unions and small community banks. What is surprising is this. Anyone with a checking account – and that’s about 200 million Americans -- knows that changing financial institutions is not a simple process. It takes time and the process requires a small mountain of forms, paperwork, documentation and signatures in order to complete the process.

But, when you consider how upset and angry consumers are with banks for threatening to raise debit card fees and charging for traditional services that were once free, it’s not surprising that consumers are walking across the street to start new banking relationships with credit unions and smaller community banks.

We refer to this consumer syndrome as “FEES” which stands for “Feeling the Economic Effects.” There’s no question consumers are in financial pain and their response to the insensitivity of big banks has been to pull their accounts in favor of small community banks and credit unions that are renowned for their customer service and friendly banking terms.

While the percentage of new customers that have made the switch from major banks to credit unions and community banks since October 1 is very small – less than one-half percent according to the American Consumer Council -- and their deposits represent less than $5 billion, the switch of that many customers in a six-week period should send a clear distress signal to major banks and their trade associations that consumers have had enough! Banks need to change their policies and customer relations practices if they want to stop the bleeding and start to win back disaffected consumers.

The American Consumer Council forecasts that one percent of consumers, approximately two million people, ultimately will switch their banking relationships to credit unions and community banks in the next 90 days. Such a dramatic shift by consumers will certainly help credit unions and community banks raise their visibility and improve their low-profile image among middle-class consumers who have suffered the most economic pain since 2008. It will also put credit unions on the radar screen with millions of disenfranchised consumers who have yet to make the switch, but are now talking to friends and relatives about their financial frustrations.

What else do the Transfer Day numbers tell us? Well, when you consider that the number of consumers who have already switched to credit unions is nearly double the number predicted by the organizers of the Transfer Day movement, that’s significant. What it tells me – and the American Consumer Council agrees – is that future anti-bank social media campaigns will continue; and, subsequent campaigns will morph into much larger movements that will attract more consumers to credit unions and community banks at the expense of large banks.

It also tells me that there is a major under-current gaining strength in the United States that will embolden consumers to take on bigger fish such as the oil giants, pharmaceutical companies, lobbyists, trade associations and even local, state and national governments that are grossly out-of-touch with millions of consumers who feel as though the American Dream is slipping away from them and their children. The harsh reality is this. It is slipping away, and consumers are not going to lay down and allow that to happen.

About the Author. Thomas Hinton is president and chief executive officer of the American Consumer Council, a non-profit consumer education organization with more than 116,000 members and 44 state consumer council affiliates. For more information: tom@americanconsumercouncil.org

American Consumers Take to the Streets and Banks

2011-11-05T09:55:00.001-07:00

by Thomas Hinton

Despite the continued economic hardships facing so my Americans, this has been a fascinating week for redressing the rights of millions of disaffected consumers. Although the Occupy Wall Street movement is losing some momentum, the average middle-class consumer found a new way to organize and vent their frustration with major banks. The negative response among consumers began when major banks threatened to charge a monthly debit card transaction fee. The outcry was fast and loud!

Then, on Friday, November 4, Transfer Day occurred. This event was organized by consumer groups to encourage millions of unhappy bank customers to move their accounts to credit unions and smaller community banks that enjoy a reputation of being member-focused and customer-driven not to mention great customer service!

Organizations like the non-profit consumer education group, the American Consumer Council, reported more than 1,400 new members joined its ranks in order to lend their voice to consumer concerns and affiliate with a credit union associated with ACC’s network. The Credit Union National Association (CUNA) reports that customers moved an estimated $4.8 billion to credit unions in the past five weeks since the debit card fee debacle first aired.

While most large banks have abandoned their plans to levy a monthly debit card fee, the damage has already been done to their credibility and integrity. Consumers were already frustrated and angry at major banks and investment firms dating back to 2008, when the recession started and U.S. taxpayers were required to lend billions of dollars in bailout money to major Wall Street firms and banks. So, Transfer Day was one way for consumers to vent their anger at the very people who got us into this economic mess – the 1%, if you will, who have been the target of the Occupy Wall Street protesters.

Granted, the transfer of nearly $5 billion from major banks to credit unions and community banks is a meager sum, but it’s a start. Hopefully, Transfer Day caught the attention of the major banks who now know that consumers will vote with their feet and no longer hesitate to uproot their financial accounts and move their money to consumer-friendly credit unions and community banks that really do care about people.

About the Author: Thomas Hinton is president of the American Consumer Council, a non-profit consumer education and advocacy organization with over 116,000 members and 46 state affiliate consumer councils. Mr. Hinton is a popular speaker at corporate and association events on consumer issues and trends. Contact: tom@americanconsumercouncil.org

The Foul Mood of American Consumers

2011-10-25T23:17:00.000-07:00

There’s no question that 2011 is fast becoming “the year that wasn’t!” Consumers had high hopes that the American economy would begin to rebound in 201 after three dismal years, but that hasn’t been the case.

Blame it on Wall Street, the Congress, President Obama or even the European economic mess – but the stark reality is consumers continue to feel the strain and pinch of high unemployment, upside-down mortgages, foreclosure pressures and shrinking incomes.

While the United States is no longer immune to global economic hiccups, we have the ability to fix our own economic house and put Americans back to work. What’s frustrating is nothing substantive is getting done in Washington to solve these national issues and consumers are both disenchanted and ready to fight back.

Certainly, there’s pent-up demand among consumers to purchase new vehicles, make overdue home repairs, purchase household goods and get back to some sense of normalcy. But, as long as consumers lack confidence in our national government to jump-start the process with meaningful solutions, they’ll continue to sit on the sidelines and wait. Obviously, this will only prolong our economic challenges since two-thirds of our national economic growth is consumer-driven.

A year ago, I predicted that fed-up citizens would make their voices heard. That has happened through the “Occupy Wall Street” protests not only in the United States, but around the world. Frankly, people are fed-up! Surveys and polls suggest that the next significant action on the part of consumers will be a major voter revolt in 2012. Americans will voice their frustration at the polls by “voting the ins out!” Political parties aside, it appears no incumbent will be safe in 2012. There is a growing sense that voters will choose to “throw the bums out” and seek a fresh start – one that is built on cooperation and progress.

Given Congress’ dismal record, a national house-cleaning is in order. If incumbents want to hold onto their jobs they had better address the economic woes of consumers – and fast! The clock is ticking.

About the Author: Thomas Hinton is president of the American Consumer Council, a non-profit consumer education organization with more than 116,000 members across the nation and 46 state affiliates.

Lower Debit Card Swipe Fees Won't Help Consumers

2011-05-16T11:58:00.001-07:00

by Tom Hinton

One provision of the financial reform legislation passed last year by Congress requires the Federal Reserve to issue rules that place reasonable limits on debit card fees. Commonly known as Interchange Fees or Swipe Fees, these small fees are what banks and credit unions charge merchants for processing each and every use of your debit card. Merchants pay the fee, but often pass on these fees to consumers as a cost of doing business. Of course, banks and credit unions that issue debit cards have come to rely on swipe fees as a healthy profit center.

In December, the Federal Reserve proposed capping fees at 12 cents per transaction, down from an average of 44 cents. While such a drastic cut in debit card interchange fees should be welcome news for consumers, the truth is consumers will never see a penny of that savings! In fact, consumers will most likely end up paying more money to their banks and credit unions because financial institutions will have to make up for that lost revenue somehow, someway.

The Interchange Fees issue is one more example of how Congress – while well-intentioned – has turned lemonade into lemons! Nobody wins. Banks and credit unions, which rarely agree on anything, are aligned against the Fed proposal to lower fees because they will take a direct hit in terms of lost revenue. On the other hand, merchants can’t wait for the Fed’s gift, which according to economic experts, will result in a $12 Billion savings for Main Street. And, as usual, consumers get the short-end of the stick because merchants are not required to pass on any debit card fee reductions to us. To make matters worse, consumers face the possibility of losing their free checking accounts and seeing lower deposits rates by banks and credit unions. This issue could also trigger tighter credit rules being introduced by banks and credit unions to protect them from further credit defaults by consumers.

In the final analysis, the Interchange Fees (Swipe Fees) issue is a hot potato that will not only burn the Federal Reserve, but also banks, credit unions and America’s consumers. We think the Fed should drop it until things cool down and a more rational solution is found.

About the Author:
Tom Hinton is president of the American Consumer Council, a non-profit consumer education organization with 111,000 members. He is also a popular business author and speaker who frequently contributes articles on consumer issues and business excellence. He can be reached at tom@americanconsumercouncil.org

What Citizen-Consumers of the World Really Want: The Egyptian Lesson

2011-02-02T14:52:00.000-08:00

by Thomas Hinton

It’s both disturbing and encouraging to see the strife taking place in Egypt and Tunisia. In America, we take for granted so many of our basic rights and entitlements that are causing millions of citizens to take to the streets in protest of the policies of their authoritarian governments. It’s disturbing because the very rights and opportunities these people are demanding are basic economic building blocks that every citizen should enjoy regardless of where they live or the religion they practice – freedom of speech, the opportunity to live in an economic environment that offers hope for a better life, and the right to assemble without being shot or attacked by armed thugs operating under the guise of self-serving politicians.

What is playing out in Egypt and Tunisia is also encouraging because the voice of the people is finally being heard. And, it is being heard not only in the streets, but within the inner sanctums of every repressive government around the world.

Some commentators have suggested the Arab uprisings are being fueled by fanatics and religious extremists. There’s little, if any, evidence to support such claims. I believe these protests are the result of frustrated consumers who see unlimited economic opportunities in neighboring countries and throughout western societies. Unfulfilled, exasperated and without any chance to climb the economic ladder of success, these well-intentioned protesters are asking a basic human question of their tyrannical leaders: “Why can’t we enjoy the good life?” Not only is it a fair question, but one that every government should respond to or face defeat. But, governments that exploit their citizenry don’t believe they need to answer such questions because they are not in the business of lifting-up the masses. They’re in the business of suppressing human and economic rights and controlling citizens in brutal fashion.

This is why leaders like ousted Tunisian President Zine El Abidine Ben Ali and Egypt’s President Hosni Mubarak do not remain in power. People will only tolerate so much before they take to the streets. What is happening in Egypt and Tunisia are consumer-citizens demanding the same economic opportunities afforded to a handful of people in their country and the chance to enjoy the fruits of their labor. Certainly, that is a fair demand.

No nation’s leadership can suppress the population forever and outlast the will of its people. This is why I believe there is still great economic hope for the people of Iran, North Korea, Libya, Myanmar, North Korea, Somalia, China, Sudan, Turkmenistan and Uzbekistan. As we have seen in Egypt, it only takes a few thousand people to ignite the flames of economic freedom and bring about significant constitutional change as well as new political leadership.

In this era of social networking and instant global communication, it’s not surprising that on a Friday afternoon, a handful of well-intentioned thought leaders can tweet or Facebook their friends to rally in the main square and, by Monday morning, ministers are resigning and corrupt leaders are making plans to flee the country.

Frankly, it’s consumerism at its best!

About the Author: Thomas Hinton is president of the American Consumer Council, a non-profit consumer education organization with over 107,000 members. He can be reached at tom@americanconsumercouncil.org

The Jobs Factor: Leadership is at the Core of Apple's Success

2011-01-21T07:32:00.000-08:00

by Tom Hinton

It's fascinating to observe the transformation taking place at Apple as co-founder and CEO Steve Jobs prepares to take another medical leave of absence. Given the fact that Apple stock is ranked second only to ExxonMobil in terms of its market value, there's much at stake as Jobs steps down albeit temporarily. Despite jobs' reassurance that he will remain engaged in major decisions, Apple stock has fluctuated mildly since his announcement. Analysts and stock strategists are obviously concerned about Apple's future without Steve Jobs, but so far, that concern is not stopping investors from purchasing Apple stock. Of greater concern to Apple are the millions of devoted Apple fans around the world who have come to rely on the company and its CEO as their compass for high-tech innovation and wizardry. So far, Apple's adoring fans are solidly behind the company and comfortable with Jobs' medical leave decision.

As one who teaches managers how to become better leaders, I'm intrigued by the "Jobs Factor" as I like to call it. There's no question that Steve Jobs is the face of Apple. As USA Today reported, during Jobs' second term as CEO, which began in August 1997, Apple's stock has soared more than 7,273% versus a 67% gain for Standard & Poor's 500-stock index. That's impressive whether you're an Apple fan or not! It's clear that as CEO, Jobs has inspired a rebirth at Apple leading to such innovative marvels as the iPod, iPhone, iPad, Apple Stores and the burgeoning industry knows as Apps – slang for Applications – that support all these new products. In short, Apple has transformed how a generation communicates, learns, listens to music and socializes. Steve Jobs continues to demonstrate his brilliance and his Midas touch.

Over the past 100 years, very few leaders have had as great an impact on transforming our world as Steve Jobs. Certainly Thomas Edison, Alfred Sloan (GM), Sam Walton (WalMart), Walt Disney, Bill Gates (Microsoft), Henry Ford, Thomas J. Watson (IBM), Ray Kroc (McDonalds), Estee Lauder, Richard Branson (Virgin), Philip H. Knight (Nike), Facebook founder Mark Zuckerberg and Jack Welch (GE) merit mention. In 2005, Fast Company published an outstanding list of the 100 Greatest Business Leaders of the 20th Century which included Steven P. Jobs at #26.

And so, as Steve Jobs prepares to step aside as CEO for medical reasons, the question behind the question is this. First, will Apple continue its rabid success once Steve Jobs steps down? Secondly, how does a company like Apple design a succession plan to ensure the company's continued success and growth? The second question is profoundly important when the CEO, Steve Jobs, is considered a god among his colleagues, competitors and the business media. The fact is that while Tim Cook can succeed him, no one can replace Steve Jobs.

While no one knows the answers to these key questions, I think Steve Jobs has a surprise in store for all of us. I think Jobs' greatest contribution to Apple will be revealed as he steps aside as CEO and allows Apple's senior leadership team to stand on its own. Remember, Steve Jobs has hired, trained and developed these people over the past 14 years. Jobs' goal has been to ensure Apple's profitability and product success will continue long after he is gone.

Interestingly, for Steve Jobs, this is not unchartered territory. When Jobs resigned as Apple CEO in September 1985 after a bitter confrontation with his board of directors, he was succeeded by a series of less-than-successful CEOs. During Jobs' 12-year absence from Apple, he had time to reflect on his successes and mistakes as a leader, innovator and business strategist. One of the mistakes Jobs acknowledged and vowed not to repeat was hiring the wrong people to lead the largest (and greatest) technology company in the world.

Now, Steve Jobs can step aside knowing he has in place a solid executive management team with capable leaders like Chief Operating Officer Tim Cook and Chief Financial Officer Peter Oppenheimer. These leaders have been schooled in how Jobs thinks and fosters creativity and innovation at Apple. They embrace the Apple culture and will maintain its current course to greater successes. Despite the concerns that Steve Jobs' temporary departure from Apple is causing to Wall Street and the business media, I am confident that Apple will continue to outperform its competition because Steve Jobs has learned how to create a culture of excellence and innovation that now permeates all levels of the world's greatest tech company.

About the Author: Tom Hinton is president and CEO of the American Consumer Council. The author of four books, Mr. Hinton is a popular speaker at corporate and association meetings on Leadership, Customer Service and Creating a Culture of Excellence in the Workplace. For information, contact: tom@americanconsumercouncil.org

Getting Through Airport Security This Holiday Season

2010-11-22T09:42:00.000-08:00

by Thomas Hinton

There’s been a lot of huffing, puffing and whimpering lately about the Transportation Security Administration's (TSA) tough new airline boarding security checks. Some people are threatening to stage protests in the TSA screening lines and disrupt Thanksgiving and Christmas holiday travel for the rest of us. This would be a serious mistake. It would also be an act of pure stupidity, selfishness and change nothing.

As a frequent traveler, I don’t like having to unpack my liquids, take off my belt and shoes and walk barefoot through metal detectors or a band scan machine. But, let’s get real, folks. We live in an era where very bad people hate you and want to do bad things to Americans. I certainly don’t want to be on an airplane where the passengers were not screened because someone felt their personal privacy was being invaded or their constitutional rights trampled by a government employee. Are you kidding me?

While I don’t like to operate from a fear-based mindset, I know the terrorist threat is real and we cannot afford to allow the bad guys to slip through our national security net because a small group of well-intentioned citizens don’t like going through the airport screening device or getting body pat downs. That’s too bad. They’ll need to adjust to the times we live in.

Let’s look at the facts. First, a relatively small number of the 34 million people who have flown since the new procedures went into effect have been subject to body pat downs that have come under withering criticism in recent days. While the process is somewhat invasive, it’s necessary as terrorists come up with innovative ways to blow up airplanes and disrupt our way of living. So, until we can find innovative ways (to screen passengers) that are less invasive and time-consuming, I suggest we get in the queue and make the best of an unpleasant -- albeit brief -- experience. Smile, follow the instructions and just deal with it.

Can you imagine the consequences of not screening passengers? As we already know, it only takes one madman to disrupt a flight or bring down an airplane. It would be irresponsible and selfish for anyone to organize delaying actions or contest body scans once they are in line at the airport. It will only result in delaying thousands of travelers who want to go home and see their loved ones for the holidays. The TSA is not going to compromise on airport security procedures nor should they.

So, here’s my advice. You don’t need to like the current screening procedures or the time-consuming process. But, you need to think through your choices and consequences. Your choices are simple. If you disapprove of the current TSA screening procedures at the airports, you don’t have to fly. You can drive, take a bus, train or stay home. You can also picket outside the airport with a big sign that is sure to attract the media.

But don’t come to the airport with your bags packed and airline boarding pass ticket in hand with the intention of disrupting my boarding process and, possibly, causing me to miss my flight and lose precious time with my family this holiday season. I will not take kindly to your selfish and stupid act. Neither will those three huge rugby players behind me. They might just want to see if you can fly through a body scanner – head first!

Finally, be kind to the TSA employees. Thank them for doing a thankless job this Thanksgiving. They deal with enough idiots as it is. I’m sure they’d rather be home with their families than padding down your sweaty armpits and over-sized buttocks!

About the Author: Thomas Hinton is president of the American Consumer Council, a consumer education organization with over 100,000 members and 44 state consumer councils across the United States. Email: tom@americanconsumercouncil.org

Where Do We go From Here?

2010-11-17T10:49:00.001-08:00

by Thomas Hinton

The lame-duck Congress reconvened this week in Washington following the November 2nd election. You would think Congress would have a sense of urgency to act on major issues affecting our economy and consumers, but it appears not much will get done in the next six weeks. This is unfortunate because there is a sense of urgency among millions of consumers who are unemployed and cannot find work. It’s unfortunate because there are millions of homeowners who face foreclosure as well as declining home values and cannot sell their homes.

While many economists proclaimed the recession is over, if you look around at the shuttered storefronts and discontent among voters, it apparent our economy is not improving fast enough for most consumers. Regrettably, there is a growing sense of resignation among millions of Americans that things will not get better in the near term.

What can Congress do in the short-term to get our economy back on track? I recommend the following five steps:

1. Make the Bush tax cuts permanent. The more money we can place in the hands of consumers, the faster are economic revival will happen. Yes, we have a serious national debt, but once our economy gets back on track, federal revenues will outpace borrowing and the debt will decline. Also, it’s time to seriously reconsider the flat tax idea so everyone (and every corporation) pays their fair share. Congress should eliminate tax deductions (except for charities and college tuition) and simplify the tax laws so all Americans can pay a fair tax and feel good about it.
2. Incentivize Small Businesses to hire people. Congress should enact legislation that provides small businesses with a $15,000 tax credit for each person they hire to work for 35 hours or more a week. Small business is the backbone of America’s economy and until small businesses start hiring people, our economy will crawl along.
3. Solve the Foreclosure Mess. Congress should redirect already-approved stimulus funds to homeowners-in-distress to help them remain in their houses. In does no good to throw families out on the streets. It’s bad for the families, it’s bad for the city tax rolls and abandoned homes cause serious legal problems for lenders and neighborhoods. Reduce mortgage payments by 50% for a five-year period until homeowners can get back on their feet and the economy rebounds.
4. Cut Government Spending. There’s too much waste and duplication at the state and federal levels. Government must provide the basic needs of fire, police, roads, parks, education, courts/prisons, child protection and the DMV. Beyond that, everything else needs to be re-evaluated based on our ability to pay for it. This includes salaries and benefits for elected officials at all levels of government as well as reducing pensions and matching pension contributions to reasonable levels.
5. Cooperate. Americans are sick and tired of the in-fighting and political posturing that takes place in Washington and the state capitals. Consumers want results. We really don’t care who gets credit as long as our elected officials get the job done. So, check your egos at the doors, roll up your sleeves and start doing the job you were elected to do.

Finally, we should be reminded that earlier this year, President Obama appointed the Debt Reduction Committee to examine the national debt and bring forward recommendations on how to close the gap. The Commission’s plan calls for deep cuts in domestic and military spending, a gradual 15-cent-a-gallon increase in the federal gasoline tax, limiting or eliminating popular tax breaks in return for lower rates, and benefit cuts and an increased retirement age for Social Security.

Those changes and others, none of which would take effect before 2012 to avoid undermining the tepid economic recovery, would erase nearly $4 trillion from projected deficits through 2020, the proposal says, and stabilize the accumulated debt.

Both liberal and conservative groups will condemn much of the Debt Commission’s plan because no one likes to disrupt the status quo. But, that’s precisely what’s got us into this mess and, frankly, it’s why voters rebelled on November 2nd and re-structured Congress.

So, it would serve the current lame-duck Congress well to remember what voters want and need. To delay action on these vital issues will only exacerbate our problems and stall a meaningful economic recovery for all Americans.

About the Author. Thomas Hinton is president & CEO of the American Consumer Council, a non-profit consumer education organization with over 100,000 members in all 50 states. Contact: tom@americanconsumercouncil.org

Food for Thought as Election Day 2010 Approaches

2010-10-25T13:49:00.000-07:00

You can relax. I’m not going to tell you who to vote for on Tuesday, November 2. But, there are some issues you should keep in mind when you go into the voting booth.

First, there are a few good candidates on both sides of the aisle. But, there are also some real fruitcakes seeking office! Consider your choices and remember that no egotist or whacko ever led America to a better place. Be prudent when you vote and realize that we are in the midst of a major generational change. One colleague expressed it to me this way. “It’s the establishment against the new age. We can either forge ahead through some rough terrain or surrender our future as well as our hopes and dreams to the special interests in Washington and Wall Street who only care about lining their wallets, and go backwards.” By the way, this comment is from a registered Republican.

I think my colleague accurately reflects the feelings and emotions of so many Americans who are sick and tired of being screwed over by the establishment. This candid assessment on the part of a 34 year-old got me thinking. Our economy is still a mess. We’ve spent hundreds of millions of dollars bailing out the very people who deceived us and now they’re planning to pay themselves over $150 Billion in bonuses according to news accounts! What gives?

To make matters worse, more than 30% of all homeowners are upside down in terms of how much they owe on their mortgages and what their homes are actually worth. It’s reported that 22% of all homeowners face the threat of foreclosure. At the same time, banks and other mortgage lenders are seizing homes using underhanded -- and possibly -- illegal methods instead of working with homeowners to help them stay in their homes, repay their mortgages, maintain their neighborhoods and continue to pay local property taxes. Doesn't that make more sense? Apparently not to bankers!

With regard to unemployment, the figures are dismal. 60 Minutes reported last week that more than 27% of the American workforce is either unemployed, under-employed, surviving on government welfare programs or they’ve quit looking for a job.

Yes, Congress is spineless, beholden to special interests and deserves to be ousted. And, yes, for better or for worse, President Obama has pushed through Wall Street reform, a health care initiative that will insure another 14 million uninsured Americans, and signed major consumer protection legislation to protect citizens from credit card vultures and unscrupulous financial institutions.

As my colleague noted, “It doesn’t seem like we’re making much progress, but from my perspective, we’ve taken a number of baby steps in the past two years, and we’re moving in the right direction.” I agree. Many of these reforms are long overdue and will keep us moving forward as a nation and a society.

Now, if we could only figure out how to retire at age 60 like the French, we’ve have it made! What’s that? The French are raising the national retirement age to 62! OMG! We’re doomed!

About the Author.
Thomas Hinton is president of the California Consumer Council, a non-profit consumer education organization with more than 38,000 members. He can be reached at: tom@calconsumercouncil.org

Americans Can Learn the Art of Customer Service from Asia

2010-04-28T23:15:00.000-07:00

by Thomas Hinton

It’s no surprise that customer service has been on the decline for the past ten years in America. Company executives are quick to blame the economic downturn for the decline in service. But, frankly, that’s just a weak excuse for companies that are not willing to spend the money to train their employees in the art of customer service. But, there’s a deeper problem that is causing the decline in customer service among American companies. And, it’s a two-headed monster!

The first head on this menacing monster is a mindset among the bean counters within corporate America who fail to see the correlation between superior customer service and profit. For these mindless bureaucrats, who fatten the top line of most businesses and contribute little to the bottom line, customer service is a cost-center. From their narrow vantage point, teaching employees how to smile, be polite and answer customer questions doesn’t translate into more revenue. This mindset is problematic, but it can be cured by enlightened leaders who understand that customer service is a philosophy not a department!

Unfortunately, the second head on the monster is more challenging because it is rooted in our changing national culture which has drifted away from customer service because of greed, technology and the unwillingness of consumers to fight back for better service and fair treatment. How do we go about restoring customer service as a way of life in America?

Perhaps, the answer can be found across the Pacific Ocean. On a recent trip to Hong Kong, Macau and Tokyo I found customer service is alive and well. Certainly, these destinations have been hit with tough economic times; and yet, their commitment to superior customer service is unwavering. Why is that?

I think the answer is cultural. There is something inherent among Asian cultures that teaches people to be of service, to be kind and help each other. There is also a deep regard among Asians for respect and common courtesy. I remember an advertising campaign by Toyota in the early 1990s that emphasized uncommon courtesy. It was brilliant because it captured the essence of a traditional Japanese custom -- courtesy -- and Toyota’s commitment to superior customer service based on respect for people.

That sentiment is alive and well in Asia. At every stop, the overwhelming majority of people -- from hotel clerks and waiters to taxi drivers and flight attendants -- practiced the art of superior customer service. For them, it is a way of life to be of service. For Americans, it’s part of our job. Regrettably, too many Americans fail to practice the basic tenets of superior customer service (courtesy, respect, quality and going above-and-beyond the call of duty for our customers) in their everyday life. For most Americans, practicing superior customer service takes too much time and effort. We’d rather be ill-mannered and arrogant. We’d rather blame the customer for their stupidity than bow respectfully -- as do the Asians -- and humbly apologize in order to retain the customer’s loyalty. And, let me add, Asians do this regardless of how wrong the customer is. Why?

Well, I think the Asians understand the concept of “winning a customer for life!” Contrarily, in the United States, if the customer is wrong or acts like a jerk, we would rather tell him/her to go jump in a lake!

So, if you’d like to rediscover the beautiful art of customer service, I encourage you to visit to Hong Kong, Macau or Tokyo. In addition to their spectacular beauty and wonderful sites, you will find customer service is alive and well -- and, by the way, so is their business!

About the Author:
Tom Hinton is president and CEO of the American Consumer Council, a non-profit consumer education organization with more than 93,000 members in 44 states. Mr. Hinton can be reached at: tom@americanconsumercouncil.org

A Great Week for America's Consumers

2010-03-26T21:31:00.000-07:00

by Thomas Hinton

Three important events took place this week which will reshape the lives of millions of Americans and, perhaps, give hope to a billion Chinese.

1. Healthcare Reform. It’s been nearly a week since President Obama signed the historic Healthcare Reform legislation and the sky has yet to collapse on us. From all the hysteria and political rhetoric hurled by opponents to this mega-legislation, I was concerned the world would end as the president signed the new law. It didn't.

The healthcare debate is a keen example of what happens when politicians place the needs of special interests ahead of their constituents. They lose focus of their obligation to represent Americans and make absurd claims that have no basis. In the process, they lose credibility. This is what happened last week to the entire Republican congressional delegation when not one Republican in the House or Senate supported the passage of this monumental healthcare reform legislation. Of course, as consumers began to realize the benefits of the healthcare legislation, some Republicans will blatantly lie and claim they supported it. But, the average consumer knows better. Consumers will remember those elected representatives who had the courage to vote "yes" and, hopefully, reward the party of “Can Do” on Election Day.

Now, millions of Americans, who have been victimized by the unscrupulous and greed-driven health insurance industry, will have the opportunity to obtain affordable healthcare insurance and not go bankrupt if they become seriously ill.

While the new legislation is far from perfect, it’s a good start. Consumers have finally been heard after more than 60 years of repressive practices by the self-serving healthcare insurance industry. As the new legislation takes shape, the abuse of middle-class Americans by medical piranhas and health insurance companies will gradually end. This is good news for all Americans -- even those who vigorously opposed the healthcare reform bill. For, they shall also reap its benefits.

College Funding: Another positive benefit of the healthcare legislation is the financial-aid portion of the bill that shifts student loans from private lenders such as Sallie Mae and banks to the federal government. This will save $61 billion over the next 10 years, according to the Congressional Budget Office, and make more money available to struggling middle-class families who are trying to find ways to pay for college. Also, the bill will eliminate outsourcing of loan-servicing jobs to foreign countries by requiring all student-aid workers to be in the United States. Once again, Democrats in Congress are entitled to all the credit for helping middle-class Americans deal with the mounting cost of college. Not one Republican supported this legislation to help middle-class families afford college. What in the world were they thinking? Are the Republicans that far out of touch with middle-class Americans? I guess so.

2. Google Stands-up to China. Integrity matters. Finally, there’s an American company that has told the Chinese communist government where to go! Thank you, Google for putting ethics, integrity and freedom of speech ahead of profits by sending a strong message to the Chinese communist bullies that you aren’t going to play by their repressive rules. Now that Google has cracked the Great Firewall of China, it’s time for other companies to support the Google Revolution by telling the Chinese government they cannot censor ideas, rewrite historical events like Tienanmen Square, control births or suppress free speech.

Let’s not forget how quickly the Berlin Wall came down after President Reagan rallied world opposition during his speech in Berlin and challenged Russia to "tear down this wall." American companies and their global partners should rally round Google and send a united message to the Chinese extremists that free-thinking people are not going to play their crooked game. Imagine the potential market under a reformed China! Imagine how much business can be had if the handcuffs of freedom are removed from the Chinese people. They, too, deserve a chance to enjoy the basic freedoms of speech, thought, dissent and democracy.

While Google has taken the first step in this economic war against the Chinese oppressors, American consumers can support this effort by boycotting Chinese goods for 30 days. If just half of America’s consumers refused to buy anything made in China (which is a lot of stuff) for 30 days, it would send a strong message to the Chinese government’s repressive leaders and fuel the fires of freedom for a billion people. This means companies like Wal-Mart would have to put ethics and human rights ahead of profits. Unfortunately, I'm not holding my breath because greed runs deep in corporate America.

3. Mortgage Relief is Coming. Finally, the third significant issue is meaningful mortgage relief. The Obama Administration has realized that its well-intentioned mortgage relief program introduced last year was worthless. Banks and other lenders got richer while under-water homeowners slipped further into debt because the mortgage bailout was a sham. Now, new rules designed to provide meaningful relief to homeowners and prevent foreclosures are being introduced and these new guidelines will force banks to forgive some debt and reassess the current market value of homes so that mortgage payments can be lowered.

This makes sense for everyone. While some mortgage holders and lenders will experience a loss on certain properties, neighborhoods will be preserved and families can stay in their homes. As the economy recovers, more people will find jobs and, in turn, be able to start making a reasonable mortgage payment.

All in all it was a great week for American consumers!

About the Author.
Thomas Hinton is president of the American Consumer Council, a non-profit consumer education organization with over 92,000 members in 45 states. He can be reached at: tom@americanconsumercouncil.org

Why Can't Toyota Come Clean with Consumers?

2010-03-05T11:02:00.000-08:00

Over the past few weeks, Toyota has been chastised harshly for mishandling its recall of 8 million vehicles and misrepresenting the facts to consumers and federal regulators. And, rightfully so.

At the same time, Toyota’s powerful public relations machine has been pumping out commercials and newspaper ads showing how dedicated its employees are and the positive financial impact Toyota has on U.S. communities where its manufacturing plants are located.

What’s happening here is a strategic ploy by Toyota to shift public opinion by touting its commitment to consumers and the company's good citizenship while distancing itself from the lawsuits and congressional hearings that are dominating the news. Frankly, this is a disturbing attempt by Toyota to dodge the central questions -- why are your vehicles malfunctioning and how long have you known about it?

Toyota's public relations strategy could have serious negative consequences if the auto company does not get to the root cause of its recall problems and come clean with consumers. To date, it appears the quick fix approach Toyota is using with regard to sudden, unintended acceleration and steering malfunctions isn’t working. More than 60 Toyota owners have filed complaints with federal officials in the past month stating ongoing problems with sudden acceleration despite their vehicles being “fixed” as part of the massive recall.

These post-recall complaints suggest Toyota doesn’t know what the root cause problem is, nor does Toyota have a meaningful solution to fix it. Perhaps this is why Toyota cannot come clean with American consumers? Furthermore, as the problem persist, Toyota's public relations strategy could backfire. Consumers are not stupid. They know Toyota is trying to soft-pedal the problem by showering us with touchy-feely commercials that are designed to boost consumer confidence in their flawed vehicles and restore integrity to Toyota’s tarnished image. What Toyota needs to understand is this situation could become another Enron if Toyota doesn't come clean with consumers and tell us the whole truth.

No one is suggesting Toyota has been corrupted from the top down. Rather, Toyota has a technology flaw that is causing some of its vehicles to lose control and injure or kill people. But, instead of coming forward and being candid with consumers, it appears that a handful of managers within Toyota's North American operation made serious mistakes in judgment by hiding the truth and failing to candidly discuss the problem. It is also possible that these same individuals kept evidence from federal regulators and lied to unsuspecting customers about the potential risks of driving certain vehicles. If these accusations are true, Toyota cannot tolerate such behavior. These people must be fired and, possibly, prosecuted. It runs against the grain of Toyota's values and culture of excellence.

With each passing day, more negative revelations are being uncovered about Toyota’s mis-management and how they either ignored or covered-up the truth on the sudden acceleration problems. This is a serious indictment against a once-proud company that has dropped the quality ball and placed profits and market share ahead of its customers’ safety and welfare.

Nobody wants to see Toyota fail despite its gross mishandling of the recall problem. After all, Toyota, Lexus and Scion dealerships employ more than 115,000 people. And, since 1991, Toyota has awarded more than $464 million to numerous organizations across the nation.For more than 50 years, Toyota has been a respected and honorable company in the United States.

But, unless Toyota Motor Corporation’s president, Akio Toyoda, wants American consumers to change his name to “Mud,” he’d better take action and fire those executives who allowed this problem to become the company's worst nightmare. Mr. Toyoda should also direct his team to come clean with consumers. For starters, it would help to know the whole truth and whether or not Toyota really understands what’s causing its vehicles to go out of control. Until Toyota gives us all the facts, consumers are not going to trust this once-proud brand and buy its vehicles.

About the Author. Thomas Hinton is president of the American Consumer Council, a non-profit consumer education organization with over 92,000 members in 44 states. He can be reached at: tom@americanconsumercouncil.org

Economy Remains Unsettled: Just Ask Consumers

2010-03-03T22:34:00.000-08:00

Over the past two months, I’ve been invited to speak at several meetings and conferences to offer my insights on the economy and consumer sentiment. The truth is nobody has a crystal ball that can successfully forecast 2010 or the future. In fact, I’m more convinced than ever before that the so-called "experts," with very few exceptions, haven't the slightest clue what they’re talking about! It's mostly gibberish coming out of New York and Washington, D.C. And, the media is also clueless.

Think about it. One day the stock market is up and everyone predicts a bright future. The next day it’s down and the doomsayers come out of the woodwork. When an earthquake in Chile can not disrupt a country, but also causes a serious spike in prices at Chicago and St. Louis gas pumps, something is terribly wrong with our economy or the proverbial crystal ball economists are using to predict the future.

But, there are two things I know for certain that you can take to the bank. Actually, these days you’d be better off taking them to a credit union!

First, consumers are very uneasy about the economy because of slow job growth, rising foreclosures due to loan manipulation by unscrupulous lenders who are not really modifying troubled mortgage loans and the mounting cost of health insurance. Despite what Wall Street tells us, Americans are not buying the spin that our economy is rebounding; and, that’s why most consumers are sitting on their wallets and not making major purchases or planning expensive vacations to Europe and Asia. Frankly, very few consumers have any money to spare. It’s just that serious!

Secondly, consumers are not convinced our elected leaders know what the hell they’re doing in Washington or at their state capitals. Just look at the irony in California. Governor Gray Davis was recalled by voters for failing to control energy prices. But, over the past several years, Governor Arnold Schwarzenegger has created a bigger mess and saddled Californians with more debt than ever before! It’s beyond the point of absurdity. Our leaders are not only inept, but also beholden to special interests. Consumers have been left out in the cold.

Meanwhile, in Washington, although President Obama has ideas and charisma going for him, very little is getting done. Many consumers are beginning to question how and when the economy will be fixed. Or, will Mr. Obama and the cowardly Congress continue to throw billions of taxpayer dollars down an economic rat hole to reboot the economy? If so, most small businesses that could jumpstart an economic revival and lure consumers back into the marketplace, haven’t seen a penny of that $750 Billion stimulus money we keep hearing about. And, neither have most consumers. It appears most of that money has gone to big business, big banks and big political donors.

The final straw will happen in November. If things don’t improve quickly, voters will throw the bums out on Election Day. This applies to every elected official regardless of their party affiliation. Consumers are sick and tired of seeing Congress issue bailouts to poorly managed companies that turn around and reward themselves millions of dollars in bonuses for their incompetence. It makes no sense to most Americans.

And, big banks, which have tightened credit instead of making affordable low-interest loans to small businesses -- and continue to jack-up their credit card interest rates -- aren’t helping matters any. Frankly, consumers are disgusted with the whole lot of them!

Just as Toyota’s misguided management is learning how angry and volatile consumers can get when their Camrys and Corollas malfunction, so to will the politicians and Wall Street fat cats feel the wrath of consumers if the American economy doesn’t rebound soon.

My crystal ball tells me that Congress and big business are in serious trouble. They had better wake-up soon and realize that “we’re mad as hell and we aren’t going to take it anymore!” I predict another revolution is coming and this one will be waged with votes and boycotts by millions of angry, disgruntled consumers.

About the Author. Thomas Hinton is president of the American Consumer Council, a non-profit consumer education organization with over 90,000 members. He can be reached at: tom@americanconsumercouncil.org

Toyota Needs to Answer Some Serious Questions to Regain Consumer Trust

2010-02-01T13:53:00.001-08:00

by Thomas Hinton

What began as a gas pedal design flaw and floormat problem for one of the world’s most respected automotive companies has mushroomed into a public relations nightmare for Toyota. Consumers are deeply troubled by Toyota's media posturing and potholed explanations. We want to know the full story. Consumers are entitled to know why this problem developed into a serious issue and resulted in the deaths of innocent people who trusted the Toyota brand. Telling the American consumer the full story is the only way Toyota can salvage its brand image and reputation because the problem is now beyond damage control.

Some journalists and persons familiar with the recall claim that Toyota's leadership knew about the gas pedal and accelerator problems nearly two years ago. But senior management failed to take action to correct the problems until the National Highway Traffic Safety Administration forced its hand by mandating a recall of 4.2 million vehicles. If this is true, Toyota’s reputation for quality and customer care will be severely tarnished.

If, in fact, Toyota’s management had early knowledge of a manufacturing and performance flaw with its accelerators and gas pedals, and failed to act, the company is not only potentially guilty of criminal acts, but its management is guilty of customer abuse - pure and simple! Whenever management places its bottom-line interests ahead of the safety and lives of its customers, it should be terminated.

Amid the growing crises, Toyota has tried to put a positive spin on the issue by taking out full-page ads in 20 newspapers across the nation to reassure customers they are fixing the problem. But, Toyota’s message in the ads is neither clear nor reassuring to consumers. The ads only raise more questions including “Who knew what, when?” And, "why didn't management act sooner to protect the lives of Toyota's valued customers?"

The underlying issue for Toyota's customers is one of credibility. Consumers are questioning Toyota's integrity. Public opinion is turning against Toyota because consumers think the company's senior leadership knew about the faulty gas pedal design and accelerator flaw long before any action was ever taken to correct these problems thus jeopardizing unsuspecting drivers including a California Highway Patrol officer who was a skilled driver but could not control his malfunctioning Lexus as it accelerated to 120 mph. He and three family members died in a fiery crash near San Diego.

The fact that Toyota's senior management allowed this problem to escalate into a public relations disaster also raises questions about their competence let alone their commitment to Toyota's high principles and values. But, the key question consumers want answered is this. Why did people have to endure injury and even die as a result of Toyota’s slow response, or worse, management inaction? It is these questions that are keeping potential buyers out of Toyota dealerships. If Toyota wants customers to start visiting showrooms again and buying their autos, the company must come forward and respond truthfully and completely to these serious allegations and unanswered questions.

Allowing Toyota’s North American chief, Jim Lutz, to appear on NBC’s Today show to explain how the company is fixing the problem is not the answer. Consumers already know Toyota is fixing the problem. What consumers want are answers to the troubling questions like “Who knew what?" and "When did they know?”

Toyota should remember that consumers can be very understanding and forgiving during troubled times when a company does the right thing. Consider the tremendous outpouring of support Johnson & Johnson experienced from consumers in 1982 when seven people died after taking pain-relief Tylenol capsules that had been laced with cyanide poison. Today, Tylenol and Johnson & Johnson enjoy a greater market share than ever before because they did the right thing. In fact, the Tylenol tampering incident has become a model case study for how a company should behave and respond in times of crisis.

Regrettably, it seems Toyota’s management hasn’t read the Tylenol case study. If only Toyota’s leadership had acted sooner, perhaps those people who tragically died from the flawed gas petals and accelerator malfunctions would still be alive. These people are the ultimate victims of management deceit, incompetence and inaction.

About the Author. Thomas Hinton is president of the American Consumer Council, a non-profit consumer education organization with more than 90,000 members and 38 state affiliate organizations across the United States. He can be reached at: tom@americanconsumercouncil.org

A Disappointing Consumer Report Card for President Obama and the Congress

2010-01-31T17:15:00.000-08:00

by Thomas Hinton

With the new year and decade just one month old, consumers are twitching nervously over the slow progress President Obama is making with his Democratic majority in Congress to jump-start America’s sluggish economy. Promises have been made and the president and his party have been very slow in delivering results. From a consumer perspective, the president fairs no better than a C+ while the Congress barely earns a passing grade of D.

Despite all the posturing, politics and rancor on Capitol Hill, not much has been accomplished to give consumers hope that a new era is upon us. The expression “herding cats” comes to mind when one thinks of the challenges Senate Majority Leader Harry Reid (D-NV) faces in getting his Democrats lined-up to support vital consumer legislation including Financial/Banking Reform, Consumer Protection, Health Care Reform and Mortgage Relief.

These issues should have been a slam dunk for the Democrats, but a lack of leadership and lax discipline has allowed the opposition to muddle the process and paint Speaker of the House Nancy Pelosi (D-CA) and Senator Reid into a very uncomfortable corner labeled non-performance. At least that’s how a majority of consumers responded when asked recently about the performance of President Obama and the Democrats for the past year. Certainly, the president and his party must do better if they expect to win the hearts and minds of concerned consumers.

Despite his gift for oratory, his persuasive personality and political charm, it appears Mr. Obama drifted from his Change theme in the 2008 election and allowed Congress to derail his legislative agenda. These are tough times and they call for strong-arm tactics similar to what LBJ used to push through his Great Society legislation and Civil Rights reform. Instead of wasting his time trying to build a consensus with Republicans, President Obama needs to produce results. As demonstrated by the stunning election of Republican Scott Brown in Massachusetts, voters have a short memory and will always vote their pocketbook, especially in tough economic times.

From a consumer perspective, the president needs to get out in front of the band and start leading the change he promised to deliver. If consumer confidence is any indicator, Americans remain seriously concerned about three issues: the lack of jobs and high unemployment; mortgage delinquencies and foreclosure rates; and, the rising cost of health care. With the exception of giving our military what it needs to win the fight in Iraq and Afghanistan, everything else can wait. It may be important, but it’s not vital to our economic recovery.

Trying to win the hearts and minds of the opposition is a waste of the president’s time. With all due respect to the opposition, I would say the same thing if the Republicans occupied the White House. Of course, when Mr. Bush was president, he was deferential to Democrats, but plowed ahead to get his legislative issues passed by Congress. And, the Democrats controlled both chambers!
So, my advice to the president and the Democrats can be summed up in the words of Republican Governor Arnold Schwarzenegger, “Sorry. No more Mr. Nice Guy!”

There’s much work to be done and the time is now for President Obama to refocus his priorities and redouble his efforts to put Americans back to work, solve the mortgage and foreclosure problem in favor of struggling homeowners and get health care reform approved. If he can accomplish these three things in 2010, his Consumer Report Card grade will improve significantly. But, the clock is ticking!

About the Author: Thomas Hinton is president & CEO of the American Consumer Council, a non-profit consumer education organization dedicated to helping consumers make safe, reliable purchases of products and services that strengthen the American economy. He can be reached at: tom@americanconsumercouncil.org

America Needs Consumer Protection and Financial Reform Now!

2010-01-06T22:23:00.000-08:00

It’s hard to believe that a year after the American financial system nearly collapsed due to corporate greed, shady lending practices and shoddy regulatory oversight, Congress has yet to pass a financial reform bill. However, we are moving in the right direction with the recent passage by the House of Representatives which approved a financial reform bill intended to re-regulate Wall Street and increase protections for Main Street.
The bill, which passed in a 223-202 vote, would create a new federal agency dedicated to protecting consumers that would police consumer credit products like mortgages and credit cards. It also establishes new rules for the trading of derivatives and increases the transparency of the credit-rating process -- two previously under-regulated parts of the economy that played a large role in last year's economic collapse.
What is very disturbing was that not a single Republican voted for the bill. Twenty-seven Democrats broke with the rest of their party to vote against it. I would think there would be bipartisan support for financial reform because, without it, America’s economy is vulnerable and susceptible to another financial disaster of epic proportions. But, politics and lobbyists continue to undermine this important legislation.
Despite the millions Wall Street and the Chamber of Commerce spent fighting the will of the American consumers, the House of Representatives found the political will and courage to pass the proposed financial reform legislation and send it on to the Senate for their deliberation and vote.
While the proposed legislation will disappointed some consumer groups, the American Consumer Council strongly endorses the reform legislation and encourages the United States Senate to pass it.

About the Author: Thomas Hinton is president of the American Consumer Council, a non-profit consumer education organization which administers ACC’s Green C™ Certification Program. He can be reached at tom@americanconsumercouncil.org

The Baucus Healthcare Debacle

2009-10-01T08:51:00.000-07:00

by Thomas Hinton

For several months, the Senate Finance Committee has labored to draft healthcare legislation. Its original intent was to help millions of uninsured Americans gain access to affordable healthcare. What began as a noble cause has deteriorated to the point where the proposed legislation looks more like a rescue bill for the health insurance industry than a lifeline for 36 million uninsured Americans.

For now, healthcare reform has become Senator Max Baucus' healthcare debacle. Senator Baucus, the Democratic Chairman of the Senate Finance Committee, claims to support universal healthcare as well as a public option for health insurance. However, he cannot seem to wiggle free from the chains of the health insurance lobby that has padded his campaign coffers with nearly $3 million in contributions. How can such a person make a rational decision and act without bias towards the best interest of our nation? The fact is he can't.

What confounds me is why this issue is so difficult. We are the richest nation in the world and yet, we are the only industrialized nation that does not provide its citizens universal healthcare coverage, let alone affordable access to the world's finest professional healthcare system. Yes, it costs money; and, yes, taxpayers must foot the bill. But, if the Congress does not act quickly and authorize a sensible long-term solution to our growing healthcare crisis, we will be saddled with trillions of dollars in healthcare costs that no one will be able to afford.

I believe the real healthcare question before us is an ethical question. Does the government of the United States of America have an ethical responsibility to all its citizens to provide them affordable access to healthcare? If the answer is yes -- and I believe it is -- then related issues such as how Americans access physicians, hospitals and clinics -- and whether the government creates a single-payer system or allows the current multi-payer system to remain in place -- are much easier to solve.

But, Senator Baucus and other Democratic senators cowered in the face of minority opposition. They voted down amendments to include the public option insurance program and, instead, endorsed a watered-down healthcare bill that will not meet the needs of the uninsured. His committee was asked to create a race horse and, instead, it created a camel! The proposed legislation will not solve the problem of rising healthcare costs. It only builds on the financial interests of greedy health insurance companies who already have veto power over medical insurance claims and the authority to deny treatment to thousands of Americans who desperately need medical attention and life-saving care.

If the Congress continues down its current path, the end result will be a significant defeat for the Democratic majority who have, thus far, squandered their electoral goodwill and grossly disappointed a significant majority of Americans who elected this Congress to bring about change. Part of the "change" covenant includes facing down the minority opposition that has crippled our nation economically during the previous eight years and standing up for those Americans whose voices have not been heard in years. Now is the time for the Democratic-controlled Congress to flex its muscle and have the courage to pass meaningful healthcare reform that insures the uninsured. Damn the opposition and full speed ahead! It's time the Congress did what's right!

About the Author. Thomas Hinton is president of the American Consumer Council and a frequent speaker at corporate and association meetings on business excellence topics. He can be reached at: tom@americanconsumercouncil.org

Reading the Tea Leaves: This Recession is Still Far from Over!

2009-09-26T15:05:00.000-07:00

For the past month, I’ve been scanning newspapers, watching CNBC and other economic news stations and listening to radio talk show experts to find out how our economy is doing. To my surprise, Federal Reserve Chairman Ben Bernanke announced that the recession is all but over. However, in reading the economic tea leaves, I don’t think so. There's no such message in my fortune cookies!

The reasons I have serious doubts about this recession are simple. We still face four serious problems that will continue to stall a recovery until they are solved. First, many consumers are flat broke. They’ve spent their savings during the past two years and cannot afford to buy expensive items like cars and vacations. Secondly, the American economy is still bleeding jobs. Until companies start hiring en masse to replace the millions of jobs lost during the past three years, most consumers will not spend money. They’re afraid their job might be cut next. Thirdly, a staggering number of homeowners continue to struggle with their mortgage payments. Because of wage cuts, job losses and savings depletion, the threat of foreclosure remains serious for many American homeowners. Fourthly, the average American, who has healthcare insurance, is struggling to pay their healthcare premiums which continue to rise. Each day, thousands of Americans are being forced to make the painful decision to abandon their healthcare insurance because they can no longer afford it.

So, while I’m pleased that Mr. Bernanke thinks this recession is almost over, I disagree. I think it’s far from over. And, while I’m pleased Wall Street is making a strong comeback, that isn’t what’s going to revive and sustain the American economy. The ultimate antidote to nursing our economy back to health is consumer spending; and, that’s not going to happen until we solve the four problems I’ve noted.

About the Author:
Tom Hinton is president of the American Consumer Council. He is also a popular business author and speaker who writes frequently on consumer issues and business trends. He can be reached at tom@americanconsumercouncil.org

Consumers Criticize Airlines' Deceptive Fees for Baggage, Seats and Pets

2009-09-26T14:39:00.000-07:00

Thomas Hinton, president and CEO of the American Consumer Council (ACC), has sharply criticized ten domestic airlines for using deceptive pricing practices to take advantage of unsuspecting consumers who fly their airlines. According to the Department of Transportation's Bureau of Transportation Statistics, a recent report shows that domestic airlines collected $3.8 billion in non-ticket fees for checking bags, the cancellation and re-booking of flights, carrying pets aboard planes and assigning seats.

The ten domestic airlines that Hinton criticized during CNBC's Power Lunch program included: American, Delta, U.S. Airways, United, Northwest, Continental, AirTran, Spirit, Frontier and JetBlue. Hinton said the ten airlines collected more than $669 million dollars in baggage fee revenues alone during the 2nd quarter of 2009. Hinton claimed that "many of those baggage fees were collected from unsuspecting travelers and who were unfairly charged."

On CNBC's Power Lunch program, Hinton also stated, "These types of a la carte pricing practices are unfair, deceptive and should be stopped by the airlines or, if necessary, a class action lawsuit."

Hinton explained that most travelers assume when they purchase an airline ticket, it entitles them to receive an assigned seat, check a piece of luggage and receive a snack and beverage aboard their flight. Hinton added, "These ten airlines should be upfront and truthful with consumers by including these traditional items in the cost of a ticket. To do otherwise, is viewed as deceptive and under-handed."

Hinton also questioned the credibility of the airlines industry because of recent problems with extended flight delays, an increase in the number of lost bags and the mishandling of luggage. Hinton referenced the "United Breaks Guitars" You Tube video by musician Dave Carroll, a United Airline passenger, whose expensive guitar was tossed around like a football on the tarmac of Chicago's O'Hare Airport by United Airline baggage handlers. United Airlines denied responsibility for nine months until the popularity of the You Tube video forced the airline to make amends.

Giving credit where it was due, Hinton did praise Southwest Airlines as the only major domestic airline that practices ethical and fair pricing because they do not charge under-the-table fees or service charges for baggage, pets, or in-flight meals.

Hinton noted that unsuspecting travelers must often pay an extra $50 - $100 per flight as a result of the service charges and fees issued by airlines. He called on consumers to express their displeasure with the ten domestic airlines that are "manipulating ticket prices by using under-the-table fees and service charges to boost the true cost of travel" Hinton encouraged CNBC viewers to "tell the airlines you don't like their deceptive and unfair pricing tactics."

Hinton also renewed his call on Congress to pass the Airline Passengers' Bill of Rights claiming, "Nothing has been done by the airline industry during the past year to improve customer service, treat consumers fairly or instill ethical pricing tactics so the real cost of travel is transparent."

The Mood of American Consumers Remains Cautious: An Interview with ACC President Thomas Hinton

2009-09-07T22:24:00.001-07:00

The following interview on the mood of American consumers was conducted on September 7, 2009 with Thomas Hinton, President & CEO of the American Consumer Council, by Consumer News & Views.

CNV. Most economic data suggest that the United States remains in a deep recession. What is the mood of American consumers and when do you predict the economy will turn around?

Hinton. There's no question the United States remains in a serious recession. Consumers are still hurting. We are still losing jobs and small businesses are reluctant to hire people until they see stronger signals that the worst is over.

CNV. Do you think the worst is over in terms of the recession?

Hinton. That's a tough question because companies are still laying-off thousands of employees and consumer confidence remains low. I'm also troubled by the number of home foreclosures and bankruptcies. Those numbers are too high and that's not a good sign for a recovery to begin.

I just returned from Europe and Scandinavia and it's apparent that America's economic woes are having a negative impact on many countries around the world. As long as American consumers refrain from spending and traveling, the global economy will suffer. As far as predicting a turn-around, I think three things need to happen. First, the federal government's stimulus plan needs to take root and federal agencies need to start pumping money into state and local coffers. Secondly, we need to reverse the job losses by generating millions of new jobs. Frankly, this is President Obama's biggest challenge because without job creation, consumers are not going to spend money they don't have and the economy will remain stalled. Thirdly, we need to correct some fundamental flaws in how we do business in this country to ensure we don't repeat the same economic mistakes again. I'm talking about strengthening federal regulations that prevent large companies and Wall Street from holding our nation hostage, economically speaking. Most consumers resent the federal bail-out of Wall Street companies and the billions of dollars taxpayers had to spend to set things right. Also, it's time Congress got serious about passing legislation that protects consumers in the critical areas of health care coverage, environmental protection, airline delays, credit card fees, foreclosures, student loans, and identity theft. Frankly, all eyes are on Speaker of the House Nancy Pelosi and her Democratic majority to see if Congress delivers. If Congress doesn't deliver, I think Speaker Pelosi will have squandered a once-in-a-lifetime opportunity to do great things for American consumers and the nation.

CNV. Do you see any consensus among consumers on the issue of health care reform?

Hinton. There's certainly consensus among the 40 million plus consumers who either have no health insurance or are under-insured. I think the entire health care debate really boils down to three key questions. First, should every American have access to quality health care? If the answer to this question is yes -- and I believe yes is the right answer -- then the second question we must ask is: What system should we create that ensures every American has access to quality health care? And, thirdly, how will we pay for it?

The current national debate is all wrong. Our leaders should be focusing on America's moral obligation to its citizens to ensure every American has access to health care. Until we have agreement on America's moral obligation to provide health care to every citizen, we will not arrive at the proper solution.

TR Reid, a respected journalist, has written a great book entitled The Healing of America. Mr. Reid studied the various health care systems of many countries and found that the United States is the only developed nation that does not provide universal health care to its citizens. Why is that? It makes no sense that the richest nation in the world has not made the moral commitment to ensure its citizens receive the finest health care in the world. It is generally acknowledged that America has the finest health care professionals, hospitals, and research facilities in the world. But, unless you have health insurance, you cannot access our doctors, hospitals, or research facilities. Frankly, it's an embarrassment to our country.

Opponents claim a universal health care system will create socialized medicine -- whatever that means -- or eliminate a person's freedom to choose their own doctor or hospital for treatment. That's pure nonsense. These statements are nothing more than a scare tactic on the part of the special interests who don't want Americans to have open access to health care -- plain and simple. It appears this deceitful misinformation campaign on health care is being funded largely by a few health insurance companies that stand to lose billions of dollars in sky-high health insurance premiums if Congress adopts a single-payer system. The reality, however, is unless we change the current system -- and, specifically, how we pay for health care -- we will be bankrupt within 25 years because we cannot keep pace with the ballooning costs of health care. So, a meaningful solution must be found soon. That is the reality regardless of one's political views or special interest.

I would encourage consumers to read The Healing of America to gain an objective understanding on the various health care options that are working in other countries. I also think we need to stop protecting the "sacred cows" of health care -- like the health insurance companies -- that are controlling life-and-death decisions such as who can be treated and which treatment patients can receive, how much money doctors and hospitals get paid for a procedure, and which pill you can take to get well. It's not the federal government consumers should be afraid of when it comes to health care. It's the health insurance companies we should fear because they are the ones who are making life-and-death decisions for patients. It just doesn't make any sense. There are better options for American consumers.

CNV. Where will the new jobs come from?

Hinton. I mentioned earlier that America needs to rethink how we do business. But, we also need to reinvent our business growth model if we expect to remain the number one global economic power. I can assure you that China, India and other countries are not sitting idle.

I think the long-term answer for job growth in the United States will be found in three key areas: Green, Information Technology, and Knowledge Management. Certainly, bio-sciences, health care, education, defense, entertainment, agriculture and smaller specialty industries such as space exploration and scientific research will support America's economic growth over the next 25 years, but we need to recognize as a nation that we have entered a new economic era and begin to train a new generation to fill the jobs that will be created in these growth industries.

We also need to retrain the millions of Americans who have lost their jobs, and give them new skills and a renewed sense of economic hope. The unemployed are good, decent people who are trapped in an economic downturn not of their making or choosing. So, we owe it to them to provide the necessary training and education to put them back to work.

CNV. Are you optimistic for consumers in 2010?

Hinton. I think the short answer is yes, I am cautiously optimistic for 2010. But, my optimism for 2010 depend on a few key issues. First, I think consumers need to see measurable progress in Washington on the major issues we've discussed in this interview. Secondly, I think President Obama is on the right track and he needs to press ahead and get Congress to adopt his proposals and quickly implement his plan. This probably means that some regressive members of Congress will be left behind, but that's politics. The sooner Congress and the president act, the sooner we will see a meaningful recovery. If Congress lacks the political courage and will to act, all bets are off. 2010 could be another dismal year. If that happens, I'm concerned that China will pull ahead of the United States and become the dominant economic force for the next 20 years because they have the resources and economic capacity to beat us. So, the political and economic stakes are very high.

In terms of consumer confidence, it's beginning to inch upwards because -- despite the naysayers and political commentators -- most consumers think Mr. Obama is on the right track and he is addressing the tough issues that need to be resolved in order to create long-term economic growth.

If there is a silver lining to our current economic crisis, it is this. Out of adversity comes opportunity. One of America's greatest strengths is good old Yankee ingenuity. Americans have a tremendous innovative spirit as well as the ability to take an idea to market quickly and cheaply. So, new ideas for products and services will flood the marketplace as soon as the economy recovers. There is certainly pent-up demand among consumers to buy new cars, clothes, electronic goods and other staples that drive our economy. But, until we see job growth and a spirit of cooperation in Washington, I think consumers will sit on the sidelines with their hands on their wallets and purses and not spend money. And, every day consumers sit on the sidelines is another day we postpone the recovery.

Common Sense is Not Common

2009-08-11T12:48:00.000-07:00

by Tom Hinton

In his classic book, A World Waiting To Be Born: Civility Rediscovered, the late author Dr. M. Scott Peck, noted that today’s society suffers a serious and disruptive illness -- incivility. Dr. Peck believed our destructive patterns of self-absorption, callousness, manipulativeness, and materialism are so ingrained in our routine behavior that we cannot recognize them. Like Dr. Peck, I believe incivility is fatal to companies, government agencies and politicians who treat people with contempt or indifference.

During the past few weeks, there have been numerous cases of incivility that cause me to wonder how people in important positions can act so callously or dim-witted? Regrettably, the examples of incivility range from President Obama labeling the Cambridge Police Department as “acting stupidly” to sports and, not surprisingly, the whipping boy of consumer dissatisfaction -- the airlines industry.

Unfortunately, for President Obama, his choice of words was less than presidential. To label the Cambridge Police Department for “acting stupidly” before Mr. Obama had all the facts left him open to criticism and derailed his health care reform efforts while his critics crowded the airwaves dissecting his ill-chosen comments. It took a few beers and photos at the White House with Sgt. Crowley and Professor Gates, Jr. to clear the air and get the president out of the Cambridge dog house. It was a tough lesson for Mr. Obama on civility and choosing one’s words more carefully.

Next, consider the bonehead decision by the management of Continental Express to allow 47 passengers to sit for six hours on a deserted tarmac after flying from Houston to Minneapolis -- only to be diverted to Rochester some 90 miles away. After nine hours, the all-night camp-out on Continental Express Flight 2816 took on the smell of soiled baby diapers and a backed-up toilet that was over-used by the stranded passengers in the regional jet. You would think that after JetBlue committed a similar blunder two years ago -- stranding thousands of passengers on planes that sat within spitting distance of the JFK terminal -- that Continental Express would not make the same dumb mistake. What should have been a 2 1/2-hour trip from Houston to Minneapolis became a nightmare for those 47 passengers. It also provides us with a new definition for incivility. After all, what civil-minded person would confine 47 passengers in a foul-smelling airplane without ample food and water for nine hours? It borders on torture let alone stupidity.

But, common sense is not common in the airline industry. Just ask, United Airlines which continues to suffer stock losses and the disdain of consumers who watched guitarist Dave Carroll’s YouTube video saga entitled, United Breaks Guitars. Passengers sitting aboard a plane in Chicago witnessed UAL baggage handlers tossing Carroll’s guitar like a football. When Carroll retrieved his expensive Taylor guitar at his destination, he found it had been broken. Carroll’s efforts to have United Airlines fix his instrument fell on deaf ears for 9 months. So, Carroll wrote the widely popular song, United Breaks Guitars, which has been viewed by 4 million people. Is it simply a coincidence that many stock analysts believe the Mr. Carroll’s United Breaks Guitars sage has cost UAL millions in stock losses? If so, that’s an expensive lesson in civility and disdain for your customers!

Another example of incivility concerns Tiger Woods, who was fined by the PGA Tour for his public criticism of a rules official after winning last week’s Bridgestone Invitational in Akron, Ohio. In this example of incivility and a lack of common sense, Tiger is being unfairly punished by the PGA for criticizing the referee, John Paramour, who told Woods and Padraig Harrington they were being “put on the clock” for slow play at a critical time in the final round of the tournament. At the time, Harrington clung to a slim one-shot lead at the par-5 16th hole. The comment by Mr. Paramour rattled Harrington. Tiger Woods said afterwards said the intrusion by Paramour caused Harrington to rush three difficult shots that led to his devastating triple bogey on the 6th hole. Harrington never recovered and Woods went on to win the tournament by four shots. Woods said he told Harrington after it was over, “I’m sorry that John [Paramour] got in the way of a great battle.” This is why the PGA fined Woods.

While Woods and Harrington lagged behind the players in front of them, their pace seemed steady for a competitive two-man duel. While the PGA will argue that Paramour was within his right to put Woods and Harrington “on the clock,” his timing was terrible and, thus, lacked civility. Even well-intentioned people make bonehead plays that confound common sense.

Finally, I’m sure Dr. Peck would be troubled -- as I am -- by the recent incivility at the various congressional town hall meetings as the merits of a proposed health care reform plan are debated. Certainly, such a sweeping proposal will draw many different ideas, comments and opposing viewpoints. But, in watching the news coverage of these town hall meetings, it is both disgraceful and undignified how so many Americans are conducting themselves. Whatever happened to civil discourse and allowing one person to voice their opinion before an opposing thought is expressed? Instead, I see angry old men yelling and screaming at women and children. For what? If this is political theatre, shame of those who would defame America’s prized ritual of debate. Is this the image of American society we want to project to the world that is watching America discuss health care reform? This is how we earned the distasteful label, “Ugly American.”

It should come as no surprise that many of our children hold politics, politicians, and various television news commentary programs in contempt. In their minds, our generation is not a role model for civility. We are a generation that represents everything negative, spiteful and perverse in American society. We lack common sense, self-respect, and a sense of decency and fairness not only for ourselves but for other nations as well. We have, as Dr. Peck feared, become a discredited society that is self-absorbed, callous, manipulative, and completely consumed with material things.

Can it be that we have become a nation without feelings and emotions? As one college student remarked to me last week, “America has lost its soul. I’m disgusted with all of you.” Frankly, she’s right… I’m disgusted with all of you, too!

About the Author: Thomas Hinton is president of the American Consumer Council, a non-profit consumer education organization which administers ACC’s Green C™ Certification Program. He can be reached at tom@americanconsumercouncil.org

Free Doesn't Always Mean Free

2009-08-06T21:53:00.000-07:00

by Bill Kalmar

Our cable provider, AT&T, just offered us one month of free service for Encore and Showtime. Two months ago, we took the free HBO offer for two months. After two months of “Caddy Shack” and “Willy Wonka & the Chocolate Factory” reruns, we decided to cancel. Now after just two days of Showtime we are ready to cancel again. What pushed us over the top was a rerun of “How the Grinch Stole Christmas”... in July. So come tomorrow we will return to our regular programming. Frankly, we don’t need 300 channels anyway.

What I learned from previous experiences with cable companies is that if you fail to cancel within the allotted time of your free subscription, your account will be charged and it may be difficult to obtain a refund. In the case of AT&T, I canceled the HBO subscription within a week of the free deadline, however, our statement recycled prior to that date and thus we were charged a monthly fee. It was easily reversed but I think it points out that many companies are in a financial bind and may look for unusual ways to increase their cash flow.

One case in point is our health care provider. Our payments have been due the first of the month since my retirement in 2003. Then on July 16th we received a notice that our payments are now due the 25th of each month starting with the July payment—a nine-day window for payment. This was done unilaterally without notice to subscribers. I have written to senior management concerning this and hope to receive a response before my next column.

I pointed out to management that before decisions are made the question should be raised: “How will this affect our customers?” This is a basic quality concept that is often overlooked and one that generally results in adverse reaction from customers when ignored. What makes this decision so impractical is that our prescription coverage from the same company is still due on the first of the month.

It seems companies that have reduced their staffs are having difficulty with quality control. I wonder if anyone has weighed the cost of replacing defective merchandise with the cost of having an experienced staff on board who verifies the quality and proper response to orders. I would bet that having trained staff costs less than all the miscues that are occurring.

We just unpacked a ceiling fan for installation in our family room and as luck would have it, two of the light fixtures were shattered. A call to the fan company had replacements sent to us but when the new lights arrived, the wrong ones were in the package. Another call to a different rep caught the error and new lights are on the way. I’ll let you know if the second time is the charm, but normally it takes three times, doesn’t it? Also, a sports chair we ordered has a rip in the fabric, so back it goes.

Have you seen that some of the bailed-out companies are now prepared to pay extravagant bonuses to staff members? Senior management reconciles this idiotic practice as a way to “prevent talented people from leaving the organization.” If these people were so talented, why was the company in financial trouble? I say, prohibit bonuses and let these people leave. Then let them find a job, especially in Michigan where unemployment is at 15 percent and rising. When these so-called brain-trusts leave there will be thousands of qualified people seeking those positions.

Speaking of people leaving, here is where some of you will be counting me for sure among those dining on loco weed—but understand that I'm immune to criticism and am bullet proof. Just as in the business world where CEOs are obliged to retire at a predetermined age, most likely at 65 years of age, the same should be done in the political world. Do I really want some senator or representative in his or her 80s or 90s making decisions that will effect me or my children and grandchildren? Absolutely not!

It's time for these dinosaurs to pack up their orthopedic underwear and hit the road; and I say that as a senior citizen myself.

Now go ahead, write me, and tell me that I am discriminating against the aged. Candidly, anyone who is making laws in their 80s and 90s is discriminating against me, because he or she no longer identifies with reality and the world I'm living in.

Speaking of senior citizens, how about the run 59-year-old Tom Watson just made at the British Open? He forced a playoff after leading most of the time in the four-day event and then lost on the final playoff hole. But he provided loads of excitement and certainly outplayed many younger players. Maybe some of our octogenarian senators could caddy for him.

Well, time to give cable TV another try. They're showing “The Maltese Falcon” with Humphrey Bogart. Now that’s real moviemaking

United Airlines is Broken

2009-07-22T15:05:00.000-07:00

by Thomas Hinton

Perhaps you’ve seen the You Tube video entitled United Breaks Guitars by Dave Carroll. Dave serenades us with his composition about the United Airlines baggage handlers at Chicago O’Hare Airport who tossed around his expensive Taylor guitar (in its sturdy case) on the tarmac as he and other passengers looked out their airplane window in a state of shock and disbelief. Of course, when Dave Carroll and his band members arrived in Nebraska and retrieved their musical instruments from UAL’s baggage belt, they discovered his custom-made Taylor guitar was broken.

For nine months, Carroll tried unsuccessfully to resolve the matter with UAL. But, United Airlines representatives gave him the run-around and denied any responsibility for breaking his guitar. Frustrated by his experience, Carroll wrote a comedic song entitled United Breaks Guitars and posted it on You Tube. Carroll’s story has become a public relations nightmare for United Airlines. More than three million viewers have seen Carroll’s story-song and many have responded on You Tube and Twitter with their own horror stories about United Airlines. To make matters worse, several evening news programs have shared Carroll’s saga with millions of their viewers.

Succumbing to the negative public relations caused by Carroll’s song, UAL offered to repair his damaged guitar. However, Taylor Guitars of El Cajon, California, which hand-makes each instrument, beat UAL to the punch. They seized on Dave Carroll’s story immediately and contacted him offering to repair or replace his guitar. Bob Taylor, the brilliant owner and founder of Taylor Guitars, also made his own You Tube video to counsel musicians on how to care for their precious cargo when traveling by air. Taylor recommends not checking guitars, but instead, carry-on these items which is permissible by the TSA provided they can be stored aboard an aircraft.

While Dave Carroll and Taylor Guitars have come out winners, one must wonder what in the world United Airlines’ management was thinking? Did no one at United Airlines call a “time out” to ask colleagues, “Hey, how do we come out of this broken guitar scenario without egg on our face?” Sadly, this isn’t an isolated case at United Airlines. Acts of stupidity and customer abuse are repeated multiple times every day by a growing number of disingenuous United Airlines employees who lack common sense and do dumb things that alienate passengers and those hard-working UAL employees who are customer-focused. I’ve witnessed it personally in Chicago and Denver several times. Of course, it begs the obvious question -- why?

The answer is United Airlines is broken. Organizationally and culturally, UAL lacks a spirit of service. While the majority of UAL employees are dedicated, fair-minded people who give their best every day, a growing number of toxic UAL employees have been infected with the deadly workplace virus that is best described as “I don’t care!” Regrettably, this virus is spreading throughout UAL’s ranks and is spawning an attitude of disinterest and apathy from the top down. When the “I don’t care” virus seeps into the cultural blood stream of an organization the results are often fatal for the company. In the case of United Airlines, management must act quickly to curb the spread of the “I don’t care” virus and re-orient its employees in the ways of service, courtesy and empathy for customers, passengers and each other.

I am not recommending this action without careful consideration. In addition to interviewing many UAL passengers about their negative experiences, I’ve reviewed two key documents that tell me UAL is flying blind when it comes to customer relations and meeting the needs of its passengers. Consider UAL’s mission statement, which I could not find on its website or in any public documents that were easily accessible from UAL. However, a UAL representative told me that its mission statement reads, “To be recognized worldwide as the airline of choice.” This bland statement is ineffective and says nothing about the company’s commitment to its employees, customers, suppliers or profitability. UAL is operating with a very weak mission statement that offers employees no guidance on how to treat passengers and customers.

Secondly, I evaluated UAL’s Customer Commitment Document (CCD) which consists of 12 statements that provide greater clarity and insight as to how UAL employees should behave and respond to situations like the Dave Carroll broken guitar saga. Statements #3 and #4 of the CCD read: “Provide on-time baggage delivery” and “Provide a fair baggage liability limit.” CCD Statement #12 reads, “Respond quickly, appropriately and courteously to customer questions and complaints.” That’s positive, effective and clear.

Unfortunately, nobody Dave Carroll dealt with at UAL followed the airline’s CCD. If UAL was customer-focused and had trained its customer-contact employees to respond based on the CCD, the Dave Carroll problem might have never happened. However, once it happened, UAL employees should have relied on Statement 12 to guide them to a speedy and fair solution. By ignoring their CCD, it’s obvious that UAL employees do not know the CCD exists or they have been instructed to ignore them by management. In either case, the customer loses and, eventually, so does United Airlines.

My experience in dealing with broken companies like United Airlines is they often try to gloss over these negative incidents by dismissing them as an isolated customer service glitch or a training issue. Perhaps, this is why UAL is seeking permission to use Dave Carroll’s United Breaks Guitars as a customer service training tool for its employees. But, doing so is farcical. It’s akin to the captain of the Titanic ordering a pump to drain the water after the ship has struck the iceberg and the captain ignored all the warning signs.

My deeper concern is that United Airlines’ management doesn’t get it. Having worked with many companies to help them create a culture of excellence, I know from experience that what happened to Dave Carroll and his Taylor guitar goes far beyond an isolated customer service glitch. Frankly, it’s the result of a corporate cultural that pits employees against passengers because of outdated policies and procedures as well as verbal mandates from management not to spend money on customer complaints. In the short-term, the airline wins the battle but loses the war. Ultimately, customers realize they have a choice and they choose not to fly United Airlines. But, the damage in this case doesn’t stop with one passenger deciding not to fly UAL. In the Dave Carroll situation, millions of people who fly have been negatively influenced towards United Airlines and how it mistreats passengers. To compound UAL’s problems, those 3 million You Tube viewers are telling their friends and families to watch Dave Carroll’s United Breaks Guitars and then communicating via MySpace, Facebook and Twitter to tell the world how terrible United Airlines is. So much for UAL being the “airline of choice!”

Let’s not forget that every company has customer issues and gets complaints. However, best-in-class companies pounce on these moments-of-truth to practice the ABCDs of customer service -- going Above-and-Beyond-the-Call-of-Duty -- to win back customers. As Jim Nordstrom of Nordstrom Stores once told me, “Whenever we solve a customer’s complaint on the spot, we’ve not only fixed the problem at little cost to our company, but we’ve also earned that customer’s loyalty for life.” That’s why Nordstrom is noted for its outstanding customer service. Interestingly, it was also Jim Nordstrom who told me, “You can’t fix stupid!”

One other important point: toxic employees who abuse customers are not tolerated at best-in-class companies. I’m willing to bet those guilty baggage handlers who played football with Dave Carroll’s Taylor guitar are still on the UAL payroll at O’Hare Airport. Furthermore, I bet UAL will claim they are union employees and, therefore, their jobs are protected. But, such explanations are nonsense and only prove my point that management doesn’t get it. Furthermore, this attitude only serves to spread the deadly “I don’t care” virus. When an employee commits an egregious act that results in tarnishing the brand or damaging the company’s reputation, that employee should be terminated regardless of union rules. When toxic employees are sacked, it sends a strong message to the rest of the team -- champion customer service and protect our brand and image at all costs.

When management turns a deaf ear to customer complaints and performance improvements, employees will follow management’s example; and, through subtle actions, employees disrespect their customers. Sometimes it’s unintended. But, more often than not, it’s blatant misbehavior. This is why the baggage handlers at O’Hare Airport thought is was okay to play football with Dave Carroll’s guitar. This is why the flight attendants aboard Dave Carroll’s airplane ignored his pleas to stop the baggage handlers’ from tossing his guitar case on the tarmac. This is why the baggage claims representative in Nebraska dismissed his claims when he reported his guitar broken. Countless other UAL employees gave Dave Carroll the cold shoulder for nine months. It wasn’t until he sang his song on You Tube that United Airlines decided to recognize the legitimacy of his claim and respond to his concerns. But, mind you, United Airlines was only reacting to the negative public relations caused by Carroll’s song, United Breaks Guitars. I doubt they acted out of a sense of customer concern or a spirit of service because UAL has no such corporate credo to guide its employees.

Broken companies seldom get it. It wasn’t United Breaks Guitars that should have prompted United Airlines to act and resolve Dave Carroll’s problem. It should have been United Airlines’ compassion, empathy and concern for a loyal passenger whose livelihood was disrupted because UAL’s baggage handlers abused his property. But, when the “I Don’t Care” virus infects employees, nobody gives a damn and bad things happen.

Ironically, the Dave Carroll incident could have been nipped in the bud by an attentive and understanding UAL flight attendant aboard his flight or a senior baggage handler representative at his destination who knew and practiced CCD #12. But, in a broken company, passengers like Dave Carroll get bounced around from one customer service rep to the next -- just like his Taylor guitar. In Carroll’s case, he let his broken guitar tell his story to millions of You Tube viewers who are now disgusted with United Airlines and will probably choose to fly a competitor given the option.

It would do UAL’s senior management good to revisit the first law of profitability -- acquire and maintain your customers! If this credo was part of UAL’s mission statement or guiding principles, incidents like Dave Carroll’s broken guitar would not mushroom into a public relations disaster for United Airlines.

About the Author. Thomas Hinton is president and chief executive officer of the American Consumer Council, a non-profit consumer education organization with nearly 90,000 members in 34 states. Mr. Hinton is a frequent air traveler and supports the Airline Passengers’ Bill of Rights that languishes in Congress due to opposition from airlines including United Airlines. He can be reached at tom@americanconsumercouncil.org

Riding the Green Wave to Green Certification

2009-07-10T13:51:00.000-07:00

There’s a new wave of environmental consciousness rolling across the landscape of American business. In certification circles, we refer to it as the Green Wave. But, companies are discovering that going green isn’t easy, and getting green certified is even tougher! Research data from the American Consumer Council suggests that fewer than 42% of companies that apply for green certification earn some form of recognition, and fewer than 22% pass the bar in terms of earning ACC’s Green C™ certification, a tough standard that gauges a company’s environmental compliance, safety and corporate social responsibility (CSR).

Transforming a business from the status quo to a green company reminds me of the quality movement’s early days as companies scrambled to implement Deming’s 14 points and play catch-up with the Japanese and Germans. Books by Philip Crosby, Joseph Juran, Tom Peters and Masaaki Imai were required reading for anyone who was serious about launching a quality initiative.

Some 25 years later, American business finds itself behind the eight-ball once again. However, this time, we’re trying to catch the Green Wave and compete with companies in Europe, Asia and South America that have already gained a foothold with consumers who are demanding green products and services. This includes everything from energy to carpet, and clothing to automobiles.

So, what’s the big deal? Why are so many American companies scrambling to get their products and facilities green certified? The answer is simple. Credibility with Generation Y and competition for their business!

Credibility means everything to Gen Y, those 82 million under-30 consumers, who will likely spend more than a Trillion dollars in the next five years, but will refrain from buying anything that harms the environment or depletes Earth’s natural resources. Furthermore, Gen Ys are the consumers with a conscious. They don’t want to do business with a company that is not considered socially responsibility. This is one reason why the emerging green economy has already spurred the development of a host of eco-friendly products such as electric cars, alternative wind and solar energy sources, cell phones, computers, recyclable glass (not plastic) products, carpets, furniture, buildings, and even clothing. It’s what Gen Y demands.

An example of a company that is riding the Green Wave all the way to the bank is Patagonia. By developing an environmentally-conscious corporate culture and supporting environmental causes and various groups its customers care about, Patagonia has struck a winning business formula that set it apart from other outerwear marketers. Today, Patagonia stands as a positive example for any business trying to decide whether or not to catch the Green Wave.

But, going green and earning a green certification from a reputable, third party organization are two entirely different strategies. The first is a marketing tactic companies are using to position themselves as eco-friendly with consumers. While this strategy might sell more widgets in the short-term, it is a precarious path to follow if the company cannot prove its products or services are, in fact, eco-friendly or truly green. Consumers are more sophisticated and they know the difference between an eco-friendly brand versus one that simply claims to be green. Consider the top fifteen eco-friendly brands of Generation Y. According to Outlaw Consulting, a qualitative research firm that monitors popular trends among Generation Y, the following companies enjoy “most favored status” with the under-30 crowd: Apple, Whole Foods, Trader Joe's, Toyota, Honda, Google, Aveda, Zipcar, American Apparel, Ikea, 7th Generation, the Body Shop, Starbucks, Netflix and Method.

As leaders search for a comprehensive strategy that goes beyond marketing tactics and positions their company as a real player in the green economy, they will have to include such key factors as conserving energy, saving water, reducing greenhouse gas emissions, shrinking carbon footprints, reducing waste, being more socially responsible, improving employee morale, and participating in causes that a new generation of consumers support. Environmental managers and CSR managers will play a significant role over the next ten years in helping companies set eco-policies and design eco-friendly programs. They will also be a valued member of the corporate team that melds environmental programs and green practices into the marketing message and product launches.

This brings us to getting your product or company green certified. It’s the prudent path because it offers your company a significant return-on-investment as demonstrated by companies in Europe and Asia that have already made the investment, and now, are reaping the benefits. Consider companies like Honda, Toyota, Apple, the Body Shop and Starbucks which are well-positioned to capture greater marketshare as Middle-Class America shifts its buying habits to more green products and eco-friendly companies based on the influence and pressure of their children, Generation Y. It’s no surprise that Wal-Mart saw the light a few years ago and adopted its green initiative. The world’s largest retailer understandably wants its fair share of Gen Y customers!

Of course, earning a reputable green certification is hard work. To certify a specific product requires that it passes a series of tests and meets certain environmental and industry standards. But, to earn a green certification for your company, facility, or agency requires a top-down commitment from leadership as well as a company-wide initiative that addresses such key factors as environmental leadership, environmental awareness, environmental compliance, environmental improvements, corporate social responsibility, and financial results. Frankly, obtaining green certification is not for the faint-hearted. But, earning green certification will set your company apart from competitors and endear you to a new generation of wealthy consumers.

So, what does it take for a company to get green certified? Based on my experience with the American Consumer Council, a non-profit consumer education organization that administers the Green C™ Certification program (www.americanconsumerocuncil.org/green), three things are required.

First, senior leadership must make a commitment to go green! This requires not only changing the way you do business, but a philosophical shift -- respecting and accepting your company’s role as a steward in protecting and preserving our environment and natural resources. Several companies including Gap, Green Mountain Energy, Patagonia and Whole Foods have successfully demonstrated how to complete this transformation while generating a healthy ROI. Ultimately, you’ll race ahead of your competitors and be well-positioned to capture a new generation of consumers who want to do business with you.

Secondly, study and compare the criteria of several green certification programs before you make a decision to apply. I lean towards non-profit, independent third party certification programs because they have a social benefit purpose and they are not profit-driven. Make sure the certification program you select challenges your employees to raise the bar and the criteria effectively measures how well you’ve deployed your environmental programs and policies. Also, make sure you will receive a site visit from a team of trained auditors -- assuming your preliminary score merits a site visit.

Be sure the contents of your application will be held in complete confidence. A respected certification program will sign a confidentiality agreement to this effect. Finally, insist on a comprehensive feedback report from the certifying body. The feedback report should be prepared by the auditors and address your strengths and opportunities for improvement based on your application content and site visit. My experience has been that a well-written feedback report often can serve as your environmental roadmap for continuous improvement as well as a viable marketing tool to help your company boost sales and position itself with new customers.

Thirdly, be sure you can leverage your green certification with customers and the media. A well-developed green certification program will offer some type of media recognition event, a conference or forum where you can share your best practices and successes, and a formal certification presentation ceremony that recognizes your employees and garners favorable media coverage.

Catching the Green Wave isn’t easy. But, my experience has been that for those companies that make the commitment to ride that elusive Green Wave and become certified, it can pay a handsome return-on-investment in terms of recognition, product innovations, profitability, boosting employee morale, and repositioning your products and services for the next generation of customers.

About the Author. Thomas Hinton is president of the American Consumer Council and a global expert on green certification. Mr. Hinton is a frequent speaker for companies and associations on the topics of Going Green and CSR. He can be reached at: tom@americanconsumercouncil.org For information of the Green C™ Certification program, visit: www.americanconsumerocuncil.org/green

Embracing the Single Payer System for Health Care

2009-06-08T10:18:00.000-07:00

Thomas Hinton
President & CEO
American Consumer Council

There was a time when the United States of America provided the finest health care in the world. Today, the United States is a good example of how not to build a health care system for patients.
What happened? While the answer is simple, the solution to fixing our health care system is complex because of politics, profits, and protecting special interests. The solution requires political courage and leadership. It also requires a grass roots movement on the part of millions of Americans who believe the health care system must change and health care should become a right for all Americans and not a privilege for the few who can afford high health insurance premiums.
Consider these facts. There are 305 million Americans. Some 46 million Americans are uninsured. That’s just over 15% of our population. Nationwide, 202 million Americans are covered by private insurance programs. The average annual premium for a family policy on the open market is nearly $5,800. But, with premiums rising, and private insurance programs being more selective in who they will cover and how much they will pay for certain medical procedures, there is serious concern that premiums will increase while the number of insured Americans will drop significantly because they can no longer afford basic health insurance.
There is a solution that would produce better quality, more research, healthier patients, and entice more health care professionals to return to their chosen profession. It is the Single Payer System.
Regrettably, the Single Payer System solution isn’t even on the table as the president and Congress grapple with how to fix America’s broken health care system. While President Obama should be commended for bringing together key health care industry leaders representing the various factions to create a solution to the current health care mess, the patient -- the American people -- is dying of neglect!
As long as the entrenched health care insurance companies control the Congress and the White House through their lobbyists and campaign contributions, meaningful reform will never happen. Our system has been corrupted at the highest levels of government by profits and greed when action is required, and now!
It is time the political leadership in Washington showed real courage by standing up to the health insurance industry and its lobbyists and changed the way health care is purchased and delivered in the United States. Specifically, President Obama, Speaker of the House of Representatives Nancy Pelosi, and Senate Majority Leader Harry Reid must step forward and endorse the Single Payer System. This would eliminate the need for health care insurance companies and streamline the current system saving an estimated $400 Billion annually -- more than enough to cover those 46 million uninsured Americans who are at risk.
While the naysayers will argue that such a system will ruin health care and compromise the delivery of outstanding care, they are flat wrong. In fact, if we do not move quickly and boldly to correct our broken health care insurance system, more Americans will suffer, die, and face serious financial hardships because they will be shut out from obtaining insurance and, therefore, receiving proper health care.
In the words of Senator Max Baucus (D-MT), who chairs the powerful Senate Finance Committee which oversees health care reform, “Our health care system is in trouble: costs are rising at an unsustainable rate, too many Americans are uninsured, and quality of care isn’t up to par. High costs are making it increasingly difficult for Montana’s families and businesses to afford comprehensive health insurance, which means that Montana’s rate of uninsured is growing rapidly. Although the United States spends twice as much on health care as any other country, we clearly don’t have twice as much health care.
Ironically, it is Senator Max Baucus, the one elected official who could jump-start serious health care reform, who is blocking Single Payer legislation like HR 676. Why? Because, Senator Baucus is one of those Washington politicians who is beholden to the health care insurance industry! Senator Baucus is the third-largest recipient of contributions from the health care and pharmaceutical industries since 2005. Senator Baucus has received $413,000 in donations from health care and pharmaceutical companies and lobbyists. This is according to a March 8 article by Dan Eggen in the Washington Post (''Health Sector Has Donated Millions to Lawmakers''). While this money might be significant to the senator’s campaign fund, it is surprising that -- in the scheme of things and the greater good that could be done by the chairman of the Senate Finance Committee-- such a small amount of money could skew Senator Baucus’ judgment, shade his thinking, and compromise his leadership at a time when Americans desperately need his direction to change the status quo in health care.
It doesn’t take a rocket scientist to figure out why, at the recent Senate Finance Committee hearings on Health Care Reform, chaired by Senator Baucus, he refused to invite anyone who supported the Single-Payer System to appear as an expert witness. Senator Baucus did ensure several slots for his cronies from the health insurance industry as well as association leaders and others who endorsed President Obama’s simplistic health care ideas.
Also disturbing was the fact that Senator Baucus had several Single Payer advocates, who tried to speak out at his hearings, escorted from the Senate hearing room and arrested. This raises serious questions about Senator Baucus’ objectivity, balance and sincerity when it comes to championing health care reform. It’s clear that the United States needs a new health care champion who is objective and untainted by health insurance contributions. Is there such a politician who has the courage and will to stand up against the greedy insurance companies? We’ll see.
The number of uninsured Americans is growing at an alarming rate of nearly 14,000 people every day due to the economic recession and mounting job losses. This is unacceptable. But, what is also unacceptable is the band-aid approach by the president and Congress to keep our greed-driven health insurance system in place while more Americans suffer and die as a result of the policies, rules and procedures dictated by health insurers who only carry about profits, not patients! It is time for a change in how Americans pay for and receive health care.
Let’s define what a Single Payer System is and is not. In a single-payer health system, everyone has health insurance. It is either obtained through a private insurance company like Kaiser or Blue Cross/Blue Shield, or through a government funded program such as Medicare. Also, every person is free to choose their own doctors, hospitals and related health care services. When patients receives care or treatment, they sign a statement that verifies the services they received from their health care provider (doctor, nurse, hospital, etc.). The health care provider then sends a bill for services rendered to the Single Payer -- that is, a national health care administration created by Congress to pay the health provider for your treatment. It’s simple and straightforward.
The Single Payer System does not limit or dictate the type of treatment you can receive. Those decisions are made by you and your doctor. The Single Payer System will not dictate who can treat you. It only affects how your health care provider is paid. And, yes, it eliminates the need for all the health insurance companies currently in business which cost taxpayers about $400 billion annually.
According to the Institute of Medicine, 18,000 people in the United States die every year because they lack health insurance. That’s two people every hour. The United States also has a higher infant mortality level (more children under 1 year of age die) than many other democratic countries.
For many decades, several medical associations claimed that “health care is a privilege not a right.” In an era of human development, certainly the wealthiest nation in the world should make health care a right. The Single Payer System is a step in the right direction to establishing that right.

Who Needs Banks When You Can Join a Credit Union

2009-04-21T11:26:00.000-07:00

by Tom Hinton

There's a great deal of consumer unrest sweeping across the United States. Many consumers are frustrated with their banks because we can't get loans, the interest rates on our credit cards are excessive, and banks are charging excessive fees on everything from checking to ATM transactions in order to squeeze a few extra dollars out of their preferred customers.

But wait! There is another option that your bank will never tell you about because they don't want to lose your business despite nickel and diming you! The option? Join your local credit union!

I realize changing your banking relationship is almost as much fun as having your wisdom teeth extracted. But, nowadays, joining your local credit union is simple and credit unions are eager to enroll new members. Also, they have money to lend at very reasonable terms. And, as far as credit cards are concerned, why pay 18-24% on your Visa or Mastercard when you can get the same credit card and benefits through your local credit union at low interest rates ranging from 4-9%. This is not rocket science, folks!

How can credit unions charge such modest rates? Consider the fact that credit unions are non-profit, member-owned organizations. They exist to serve their members. While they need to show a reasonable return-on-investment, they are not greedy like so many banks that must answer to shareholders. And, they are fully insured by the federal government up to $250,000 per account -- just like the banks. Gee, you can get the same protection for your money and pay lower rates... it makes sense to me!

So, stop your whining and go online and join your local credit union. To make it easy for you, there's a list of outstanding credit unions from California to New Jersey that are sponsoring members of the American Consumer Council. You can join them at no cost through the American Consumer Council by visiting ACC's website at: http://www.americanconsumercouncil.org/affiliates.html

Let me know how it goes!

Thomas Hinton is president of the American Consumer Council

Customer Service Champs or Chumps

2009-04-08T21:43:00.000-07:00

by Tom Hinton

In the March 2, 2009 issue of Business Week, the magazine’s cover story was entitled Extreme Customer Service. Business Week touted a list of 25 companies they referred to as “Customer Service Champs.” I’m wondering if there was a typo. Perhaps, it should have read “chumps.”

Frankly, these types of annual customer satisfaction lists amount to little more than beauty contests. In this case it appears that Business Week wiggled and waggled the criteria in so many different ways, the Wicked Witch of the North might have come out a winner! Consider how Business Week arrived at its results. First, Business Week tinkered with the credible criteria of its sister-company, J.D Power & Associates. Next, Business Week padded the scoring with bonus points for industry leaders while punishing companies like Starbucks, which scored high among readers, but was penalized because none of its peers-competitors scored well (duh!). Finally, Business Week included the randomly subjective views of 1,000 of its own BusinessWeek Market Advisory Board. Seriously, folks, this is how Business Week gets us to their Top 25 Customer Service champs. Hmmm? It causes me to wonder if this exercise is about crowning customer service champs or selling more issues of their popular weekly magazine?

As I examine the rankings of the top 25 companies, I note that nearly half, 11 in all, of the 25 companies cited for customer service excellence received a grade of B+, B, or B- on one or both of the major criteria -- Quality of Staff and Efficiency of Service. This begs the question: How can a company that scores less than an “A” be crowned as a customer service champ?

Another consideration for the scoring was a company’s industry ranking. What does that have to do with customer service excellence? A company either gets it right with its customers -- like a Starbucks -- or it doesn’t. Incidentally, I only mention Starbucks because by Business Week’s own admission, Starbucks might have deserved to be on their top 25 list, but was not included because its industry peers scored poorly. So what? If that principle was followed across all industry sectors I seriously doubt a single automaker would be listed. But, somehow Business Week came up with four credible selections from the auto industry to grace their top 25 list of customer service champs. How interesting.

Another question I have regarding Business Week’s criteria is how does a customer judge the Quality of Staff? It’s superficial criteria because rarely do customers get close enough to an organization to competently judge its quality of staff. Just because Joe Hustler or Susie Saleswoman smiles and remembers my name does not mean they have superior product knowledge or customer service skills. Quality of Staff is tied to a company’s hiring and training process. It’s determined by a company’s culture and level of investment in people. Certainly, customer satisfaction is a byproduct of Quality of Staff, but to suggest a reader of Business Week would know the intricacies of how Amazon.com or Lexus develops its staff is nonsense.

And, what in the world does “Efficiency of Service” have to do with customer satisfaction? The answer is nothing. If Business Week had called it “Effectiveness of Service” I would be impressed. But “Efficiency of Service” is nonsense.

Let me offer an example that demonstrates the difference. This week I met a client for breakfast in a well-known chain restaurant. Miguel, the waiter, was friendly and efficient. When we asked for coffee or juice, he responded. When we requested a refill, he responded again. If I used Business Week’s criteria, the chain would score an A+ because Miguel was efficient. But, despite Miguel’s positive demeanor, the order was wrong. The bacon was not crispy and the scrambled eggs were dry. Yes, he served us quickly but that was not our criteria for customer satisfaction. We wanted him to get the order right! When a customer needs to flag down the wait staff to request more coffee or hot water that’s not deserving of an A or a B score. When the cashier failed to add the gratuity to our final check as requested causing us to wait until he could reprocess our credit card, that’s not deserving of an A or a B score. Efficient? Yes! Effective? No!

But, let’s set aside the flawed methodology of Business Week for a moment and examine their top 25 customer service champs. Maybe, by some stroke of luck, they got it right. Among the 12 companies that scored ratings of A+, A, or A- are: Amazon.com, USAA, Jaguar, Lexus, The Ritz-Carlton Hotels, Publix Super Markets, Zappos.com, Hewlett-Packard, Ace Hardware, Four Seasons Hotels & Resorts, Cadillac, BMW, and JW Marriott Hotels. At first glance this appears to be a solid list. But, what’s disturbing to me is that between #1 Amazon.com and #25 JW Marriott, there’s a spread of 170.14 points. What’s wrong with this picture?

The answer lies in the “B” squad results. You see, 11 companies -- T.Rowe Price, KeyBank, Nordstrom, Enterprise Rent-a-Car, American Express, Trader Joe’s, JetBlue Airways, Apple, Charles Schwab, True Value, and L.L. Bean -- all outranked JW Marriott (#25) despite the fact that their grades included a B+, B, or B-. Are you kidding me? So, you can see how a flawed criteria can skew the scoring results.

On that subject, I seriously wonder how three of these companies even made the list. Based on my personal experience and knowledge of their service performance I am amazed that Enterprise Rent-a-Car, American Express, and JetBlue Airways got past the first cut. For the past year, American Express has been canceling credit worthy card members to reduce its exposure in tough economic times. That’s understandable, but it's not good customer service. And, my experience with Enterprise Rent-a-Car has been disastrous. In three rentals, Enterprise never got it right. Of course, their rental car competition leaves much to be desired as well. And, fair or unfair, JetBlue Airways cannot possibly be considered a serious contender for customer service champ as long as the image of passengers left stranded on JetBlue airplanes for up to 11 hours during an ice storm at JFK on Valentine’s Day 2007 remains fresh in our minds. Sorry JetBlue, but that’s a deal-breaker in my book. For what it’s worth, Business Week scored JetBlue Airways above Apple, Charles Schwab, and BWM among others. Go figure?

Of the remaining 8 companies on the “B” Squad, I seriously question how top performers such as Charles Schwab, which rates a perfect score based on my personal experience, and Apple, which continues to run circles around its competitors as the leader in consumer electronics innovation, rank below the pathetic “Double B” score of Enterprise Rent-A-Car? Business Week can’t be serious!

Perhaps it can be argued using valid data that companies like Nordstrom, the once-legendary customer service role model, and True Value, the hardware store that only scored a pair of B+s, should have scored higher in the Business Week customer service poll. But, these are tough times and some companies have cut staff and training to save money. If that’s the case, they don’t belong on the top 25 list.

KeyBank of Cleveland and T. Rowe Price, the brokerage firm, get a pass. I cannot dispute their service performance since I have no personal experience with either company, nor have I studied their customer service ratings.

I do find it interesting that four automakers -- namely, Jaguar (#3), Lexus (#4), Cadillac (#14), and BMW (#22) -- all scored A+ ratings with Business Week despite the fact that most consumers rank the auto-buying experience just below a visit to the dentist. Perhaps, Jaguar has done some remarkable things in the past 12 months to earn its position as the customer service champ of automakers. But I doubt it. Jaguar would have to be wizards to push ahead of Lexus and BMW on their customer service scores.

So, there you have it, folks. The top 25 customer service champs. With all due respect to Business Week, the numbers just don’t add up. Having said that, I do consider Business Week to be among the top 25 business publications in America!

About the Author. Thomas Hinton is president & CEO of the American Consumer Council, a non-profit consumer education organization which administers the Green C Certification program for companies and organizations. For more information, visit: www.americanconsumercouncil.org

Helping Consumers Go Green in Tough Times

2009-02-15T14:24:00.000-08:00

by Tom Hinton

Despite the harsh economic climate that ushered in 2009, American consumers remain resolute in their commitment to Sustainability and Going Green. This is good news not only for American businesses but also for our struggling global economy. How so? Over the past few years, Americans have realized that despite the bad economic news, the one area where they can have a positive impact is in doing business with companies that embrace eco-friendly products, services, and Green practices. Stuart Larkins, a senior vice president of search operations at DoubleClick Performics and a contributor to Chief Marketer, wrote “The budding green movement has environmentally conscious consumers buying everything from energy-saving light bulbs to fuel efficient cars, to eco-tourism vacations.”

Surveys by the American Consumer Council reveal that one possible reason for the uptick in sales is that consumers are willing to pay a few extra dollars to support those companies that are viewed as champions of Green practices, Sustainability, and Corporate Social Responsibility (CSR). Advertising Age reported on the second-annual Edelman Good Purpose study, which found “more than half of the 6,000 consumers surveyed would be prepared to pay more for a brand if it supported a good cause even in the throes of a recession. And, more than two-thirds said they would be willing to pay more for eco-friendly products.”

Perhaps this explains the modest jump in reservations at environmentally-friendly hotels and stronger sales for hybrid automobiles. While 2008-2009 business has dropped severely in the hospitality and automotive industries, reports are showing gains in these two niche areas. Industry leaders like Starwood Hotels & Resorts Worldwide and Radisson Hotels as well as Honda Motors are reporting modest growth among certain eco-friendly brands.

Green initiatives by business and government are having a positive impact on consumers. A recent Yahoo-commissioned study reveals that three-in-four consumers define themselves as “Green.” According to the survey, the Green market has grown far beyond its roots as a niche, with 77 percent of consumers identifying themselves as "Green." Over half (57 percent) said they made a Green purchase decision in the past six months. Green consumers are most likely to take sustainability into account when buying cleaning and personal care products. About 23 percent of consumers responded as "deeply committed." A larger segment, about 24 percent, defined Green as "trendy." Not surprisingly, this was true particularly among young consumers, ages 18-34.

Another fast growing eco-friendly arena for business growth is E-Commerce. According to the American Consumer Council, E-Commerce offers three benefits to consumers. First, it provides consumers fast and easy access to Green products and information. Secondly, E-Commerce allows consumers to contribute to environmental wellness by reducing their carbon footprint. When consumers purchase online they are not leaving their houses, driving their cars, or polluting the environment. And, thirdly, online buying allows consumers to research a company’s website to determine whether or not it is socially responsible and genuinely committed to Green practices.

According to DoubleClick Performics' 2008 Green Marketing Study, 60% of respondents who make online purchases say it is important that a company is environmentally conscious. The study surveyed 1,087 adults to better understand consumer behavior and attitudes regarding green marketing.

Despite the rush of so many companies to climb aboard to Green bandwagon, there are some concerns that have been raised by consumer organizations. One such concern raised by the American Consumer Council is the deluge of website information and how consumers decipher it. Jean Greer, who administers the American Consumer Council’s Green C Certification program says, “When a company provides too much green information it can be confusing and overwhelming for consumers.”

Another concern is green washing. The American Consumer Council is waging a battle against unscrupulous companies that misstate their commitment to Green or provide misinformation in order to capitalize on environmentally-conscious consumers and exploit them. When the American Consumer Council identifies a company engaged in green washing practices it demands the company cleanse its website or face a national boycott by ACC’s 85,000 members. So far, the consumer pressure by ACC appears to be working.

Another area where the American Consumer Council is trying to help companies think Green and act social responsibly is during the Christmas holiday season. It’s reported that every year more than 100 million trees are destroyed, three million cars' worth of energy is consumed and significant amounts of greenhouse gases are emitted into the atmosphere in order to produce, distribute and dispose of holiday catalogs and direct mail pieces. With the advances in technology and customer data management more companies are recognizing the benefits of posting their catalogs on their websites and reducing their marketing waste. ACC has encouraged companies to post their catalogs on their websites and reduce the number of copies printed and mailed.

Yet, despite the impressive commitment of so many companies to “Go Green,” consumers remain skeptical of big businesses’ green promises. According to a February 2008 survey of 1,080 adults from corporate strategy firm Cone and the Boston College Center for Corporate Citizenship, only 47% trust companies to tell them the truth in environmental marketing. Given that low figure, companies are going to have to work hard to demonstrate their commitment to consumers and, in turn, engage in environmentally-friendly practices and causes that result in consumer loyalty to their brands. The challenge is this. Much of the hard work must be done outside the traditional marketing and advertising channels that companies are used to. Media ads are not the answer. Instead, consumers are looking for the personal touch -- that is, actionable programs by companies that demonstrate their commitment to Corporate Social Responsibility as well as eco-friendly programs that support local non-profit organizations and their Green programs. When companies can find ways to personally touch consumers they will win customers for life.

About the Author. Thomas Hinton is the president and chief executive officer of the American Consumer Council, a non-profit consumer education organization that administers the Green C Certification program. ACC was established in 1986 and has over 85,000 members in 38 states. ACC is headquartered in La Jolla, CA. For more information, call 1-800-544-0414 or visit: www.americanconsumercouncil.org

Putting Detroit on the Road to Recovery

2008-11-21T17:05:00.000-08:00

For twenty-five years General Motors, Ford and Chrysler have resisted common sense. Now, their leaders have flown into Washington, D.C. on their corporate jets begging Congress to give them billions in another federal bailout scheme. They just don’t get it. These auto giants are grossly mismanaged and misdirected from the top down. Their woes are self-inflicted. Under their current management apparatus the Big Three are unworthy of any federal bailout. Let them take the first step on the road to recovery by filing for bankruptcy.

Certainly, consumers don’t want these companies to go out of business. But, to provide them with billions of dollars from the federal government will only exacerbate the current problem. What Detroit needs is a leadership lobotomy -- from the head down.

For starters, the Big Three can eliminate many of the perks that are symbolic of management’s arrogance. I’m talking about the corporate jets, the executive dining rooms, and the huge bonuses senior management has received for over-promising and under-delivering to shareholders.

Secondly, the United Auto Workers needs to wise-up. As Lee Iacocca once remarked in the 1980s, “We have jobs at $40 an hour, but we don’t have any jobs at $75 an hour [adjusted for inflation].” The UAW needs to approve new labor agreements that bring workers’ costs in line with Honda, Nissan and Toyota which are capturing increased market share because their unit costs are considerably lower than the Big Three.

Retiree benefits must also be reduced so that the Big Three’s pension costs are in line with their foreign competitors. Workers deserve a reasonable wage, but under the current labor agreements, the Big Three cannot compete. Unless the UAW agrees to dramatic wage cuts its members will find themselves unemployed and Detroit will suffer.

Next, the boards of General Motors and Chrysler must bring in new management teams. The ideal leadership will come from outside the auto industry. They need to break the mold as Ford Motor Company did by hiring Alan Mulally from The Boeing Company. While Mulally is struggling, he is making progress and instituting long-overdue changes at Ford. Fresh thinking and innovation should rule the day at the Big Three. Quality must be rediscovered and incentives for eliminating defects should be instituted to inspire workers to build quality cars and trucks the first time!

The Big Three’s biggest challenge is to project into the future and understand what consumers want and need. That’s pretty simple according to most consumer surveys and the recent spike in gasoline prices. Consumers want options. Consumers want fuel efficiency -- and I’m talking about 50 miles per gallon not a measly 21 mpg. And, we want electric cars and other types of clean fuel-burning motors that don’t pollute the environment. These types of innovations will invigorate the huge supply chain that feeds off Detroit. Certainly, the thousands of suppliers deserve a chance to demonstrate their talents in terms of going Green and helping a revitalized Big Three enter a new era of auto-making. But, they will remain stuck in neutral as long as Detroit continues to think backwards.

Finally, shareholders and bondholders need to pony-up. They gambled on the Big Three and, frankly, they lost. Let’s not burden American taxpayers without first putting the onus on those investors who clearly understand the odds associated with any stock purchase. It might be smart to remind them of the old adage, “Sometimes you win and sometimes you lose.”

Ironically, despite their serious financial problems, General Motors, Ford, and Chrysler have an abundance of talented people throughout their ranks. These people have great ideas that should be solicited and implemented. Often times, it’s the workers who know best how to fix management’s mess. It’s time Detroit got some inspired leadership that abandons the re-treaded ideas of the past that have gone flat. What the Big Three desperately need is a plan for success instead of trying to further bleed American consumers and taxpayers with another ill-conceived bailout.

About the Author:
Thomas Hinton is president of the American Consumer Council. He can be reached at tom@americanconsumercouncil.org

What I Did on My Summer Vacation

2008-10-14T08:48:00.000-07:00

By Bill Kalmar

For some, Labor Day signals the end of summer as preparations for autumn and the accompanying holidays begin. As is customary in some locales, warm weather clothes, including one’s white wardrobe and shoes, are returned to the closet until next spring. Children and students go back to school, much to the delight of their parents, and hopefully to the excitement of their teachers.

Chances are one of the kids’ first assignments will be to draft a report on the activities of their summer vacation. Not to be left out of this assignment, I thought it appropriate that I pen a few lines about one of our recent trips. There were no death-defying rides on some monster roller coaster, no surfing in shark-infested waters or aerial descents with a parachute from a plane, just a sensible trip to Chicago for my wife and me.

What made the trip so memorable was something I wrote about in my August column for QualityInsider (Online at www .qualitydigest.com/content/quality-insider.) The column recounted several encounters with poor service, and thus I concluded that I was in fact a magnet for service personnel and organizations that don’t practice performance excellence. Well, traveling to Chicago convinced me that somehow I had been demagnetized, at least on this one occasion.

Off to a good start

Our trip began early on a weekday as we departed our home in Lake Orion, Michigan. Our first stop was The Big Apple Bagel. As we opened the door, the aroma of fresh bagels and coffee wafted into our nostrils. Three upbeat and smiling clerks greeted us with a hearty good morning--and this was 7 a.m. It’s no wonder that this particular location is well frequented by regulars and transients alike. We left, bagels and coffee in hand, knowing that our trip was off to a great start.

Motoring to Chicago took us on the Indiana Toll Road. Often, those manning the toll booths are cranky and don’t engage in many pleasantries. Perhaps the toll road commission had everyone read Jim Collins’ book Good to Great ( Harper Collins, 2001 ) because we were met with friendly greetings at each booth. Somehow that lessened the strain of doling out a couple of bucks every 50 miles or so.

We arrived at our hotel, blocks away from the Magnificent Mile, just after noon. Our room wasn’t ready, so to take the sting off our having to wander the streets of the Windy City in our traveling clothes, the hotel gave us a room upgrade.

After a five-hour trip, which included the last 30 minutes in typical Chicago traffic, we were ready for lunch. One of our favorite haunts in the Toddling Town is Gibson’s Steak House on Rush Street. Sitting on the enclosed street-level porch gives one a view of the horse-drawn carriages trekking through town and the hundreds of shoppers toting their bags laden with one-of-a-kind purchases that can only be found in Chicago. It seems that no one in the town realizes that there is a recession underway. The streets were crowded, and restaurants and hotels were at capacity.

Our lunch was an epicurean delight even though my medium-rare steak was a bit overcooked. Our waitress, Deena, noticed the lack of rare red beef on my plate and suggested that she would have another one prepared. I politely declined and stated that it was still just fine. When our bill arrived, Deena had unexpectedly taken the cost of my steak off the bill. She did this without my having to raise an eyebrow or growl about the preparation. This signaled to me that I was in the process of being demagnetized.

After lunch we wandered into the Neiman Marcus store. Prior to our trip, we had received a phone call from a Neiman Marcus employee, Naomi, indicating that some items I might be interested in were on sale, but that after the first of the month the prices would be increasing. As we walked into Naomi’s sales area, she greeted us by name and was genuinely excited to see us again. Our last visit had been the previous year, but her ability to remember names and faces is uncanny. While in the store, I noticed that Naomi maintained a huge three-ring binder of the names and phone numbers and past purchases of all her customers. Her practice of contacting customers personally when sales develop is no doubt one of the reasons why Neiman Marcus regularly posts sales increases and profits while other stores are incurring losses.

Those of you who are watch aficionados like me would certainly enjoy window-shopping at the Tourneau store in the Water Tower. Being greeted by name by Michael, the salesperson who sold me a watch three years ago, is something that still makes an impression on me. Like Naomi at Neiman Marcus, Michael remembers names and even the type of watch I purchased. Maybe he anticipates me buying another one shortly?

Quality experiences continue

The next day saw us walking over to another of our favorite restaurants--Tucci Benucch. It’s a small Italian restaurant in the Bloomingdale’s building. For us, a trip to Chicago isn’t complete without enjoying the great salads at this little nook on the sixth floor. To our surprise and disappointment, the restaurant had now morphed into “Frankie’s Pizza,” although we were told that it was under the same management. We dined, but it was difficult to hide my disillusionment at losing our favorite lunch haunt. Our waitress must have picked up on my vibes because when we returned home there was a message on our voice mail from the restaurant’s manager indicating that many of the same menu items from Tucci Benucch could still be ordered if we asked. Just another indication to me how embedded customer service is in Chicago.

Even the cabbies get it!

Cab drivers were equally pleasant and customer-focused even though it took us several days to catch our breath from the Indy 500-inspired drivers who dart around the downtown area as if they were vying for the pole position for the next race.

As you can see, our voyage to the Windy City was an example in performance excellence. And it didn’t end there. When we returned home, I received an e-mail from The Wall Street Journal, which is indicative of its strong focus on customer service. Here is an excerpt: “We see that delivery of your Wall Street Journal was scheduled to resume today after a temporary suspension and are following up to check that it did.” Wow! Is that great service or what?

In other news

I hope that you’ll permit me to opine on some other topics.

I recently purchased a polo shirt from Macy’s and attempted to have Lord & Taylor match the price. I wrote Lord & Taylor about the incident, and their reply indicated that I would hear from “the appropriate department and someone will be in touch with you within five to seven business days.”

After a wait of three weeks, I contacted the store again. A reply finally arrived indicating that “Lord & Taylor does not have a practice of matching prices.” Perhaps the delay was attributed to the management formulating a policy? Who knows, but it tells me a lot about how it resolves customer service questions.

More and more defective products continue to enter our country from China. We are now told to check our tire pressure in the wake of a recall of as many as 30 million replacement rubber valve stems. These defective parts can crack prematurely and cause tires to lose air. At highway speeds, this loss of air could result in a loss of control with a resultant crash. It’s time we boycott Chinese products until such time as that country raises its level of quality. At this juncture, what with all the lead-based products that we have banned, I think a total ban on products from China isn’t out of the question. What do you think?

If you have noticed a downturn in customer service in some segments, let me offer an explanation. Here in Michigan, there are thousands of automotive professionals who have been outsourced, downsized, or as we say--fired! These highly qualified people now find themselves working in positions much below their level of expertise, and as such, their attitude and demeanor in dealing with customers isn’t what you would characterize as exemplary. As we frequent the various restaurants and stores in our area, I often question how long the person has been employed. What I’m finding is that there are many college grads and MBAs who are now flipping burgers. This no doubt does not make for a pleasant experience for them or the customers.

Speaking of restaurants, the Ruby Tuesday chain is looking at changing its theme by eliminating the 1980s-style décor of black-and-white checked tablecloths and Tiffany-style lamps with brass rails. There will be a new menu and a more contemporary look. Let’s hope that the consultants who are working on this project aren’t the same ones who worked on Bill Knapp’s restaurant chain. In my opinion, changing the theme and focus of this chain ultimately put them out of business. How I miss those chocolate cakes!

What would one of my articles be without a plug for my favorite hotel--The Ritz-Carlton. The J.D. Power & Associates 2008 North America Hotel Guest Satisfaction Index Study finds that the Ritz-Carlton won again as the top-scoring chain in the luxury category. Others that led in the survey included Embassy Suites in the upscale category, Hyatt Place for mid-scale full service, Drury Inn & Suites for mid-scale limited service, and for the seventh consecutive year, Microtel Inns & Suites took top honors in the economy/budget category.

Back to the hammock

Well, as I’m writing this article, the dog days of summer are coming to an end and cool nights are upon us once more. Hanging out in the hammock is still my top choice for a restful afternoon, and I hope all of you have that special place where you can relax and maybe, if I’m not being too presumptuous, ponder these words. If something resonated with you or some of my rants irritated you, please let me know by writing to the e-mail address at the bottom of this page. I personally respond to every e-mail. Until next time, remember the quote from Jonathan Swift: “You cannot reason a man out of something that he did not reason his way into.”

And by the way, as a result of our trip to Chicago, where we experienced wonderful service, I no longer attract metal shavings to my body. I have been poor-service demagnetized--at least for the moment.

Crying “Wolf” Over Wall Street’s Credit Crunch

2008-09-24T22:30:00.000-07:00

by Tom Hinton

As President Bush addressed the American public last night on America’s latest crisis -- our nation’s economic credit crunch -- I couldn’t help but recall what Marcellus said in William Shakespeare’s play Hamlet. “Something is rotten in the state of Denmark.” Certainly something is terribly rotten in the United States when a crisis of this magnitude mushrooms overnight and requires a $700 Billion solution. What in the world is going on with our national leaders?

Americans are being told by the president that our national economy -- the same economy that just last week was “fundamentally sound” according to Senator John McCain -- is facing a near-Depression disaster due to a meltdown of the credit markets which resulted in the failure of three major Wall Street banks that controlled hundreds of billions of dollars in devalued mortgages and other questionable loan derivates. The Bush Administration’s solution is simple. Congress should hand over $700 Billion to Secretary of the Treasury Henry Paulson, a thirty-year veteran of Goldman Sachs, one of the two remaining giant Wall Street firms that are teetering on the brink of collapse due to poor investment decisions,

There’s no denying we have a serious problem. But, the question that must be resolved by Congress before it hands over $700 Billion to Secretary Paulson to dole out as he sees fit is this: Is this Wall Street’s problem or is it Main Street’s problem? If the answer is Main Street, we have a serious crisis and Congress needs to take immediate action. However, if the answer is Wall Street, perhaps Congress needs to take a deep breath and try to understand the ramifications of the problem before endorsing the Bush Administration’s two-page, $700 Billion bailout solution.

American Consumers are very skeptical of the Bush Administration’s solution for ailing Wall Street financial companies. So far, consumers don’t like what they’re hearing. According to a Bloomberg/Los Angeles Times poll, Americans say Congress should reject the Bush Plan. By a margin of 55 percent to 31 percent, Americans say it's not the government's responsibility to bail out banking companies with taxpayer dollars, even if their collapse could damage the economy. Furthermore, Americans are now blaming Wall Street and President George W. Bush for the credit crisis.

The debate is running so hot that political analysts are suggesting that any member of Congress who supports the Bush Bailout is in jeopardy of losing their seat in the November 4^th election. This is causing both Democrats and Republicans to take pause and reconsider their options -- and they should! The right solution has not yet been found.

If the problem is a potential failure of major Wall Street banks, which are holding hundreds of billions of dollars in depreciating loans such as mortgages, a different solution will be required so that consumers can still access money for various loans such as auto loans, mortgage loans, college tuition loans, and so forth. Small businesses will also need money in the form of loans to purchase inventory, make payroll, and capitalize their businesses. These are important issues that the Bush Administration and Congress must evaluate. To allow a credit freeze to occur among the major banks could have serious negative consequences for Main Street.

But, having said that, the bigger issue is what will happen to Main Street if Congress does not act and the remaining Wall Street banks fail or face a fire sale? This is the dominant issue that concerns consumers because most of their money is deposited in local banks and credit unions not in Goldman Sachs and other vulnerable Wall Street financial institutions. It’s the Main Street banks and credit unions that control the 90-day revolving loans of their small business clients. It’s the Main Street banks and credit unions that will reject new loans and demand higher cash deposits if credit is tight. But, this is not yet happening. In fact, some of the large banks are eager to make loans at below-market rates. So, given the doom-and-gloom messages coming from the Bush Administration, someone in Congress needs to call a time-out and ask for a replay. What is really happening here?

Is this a case of Wall Street and the Bush Administration crying “wolf” in an effort to bailout their long-time supporters and cronies? Or, is this a serious financial crisis that could paralyze the global economy? Many consumers don’t care what happens to the Wall Street firms. Perhaps, this is being narrow-minded on their part, but consumers are more concerned about keeping their jobs, paying their bills, and avoiding foreclosure.

Certainly, the one area that must be addressed immediately by Congress is the troubling number of home foreclosures. I believe this is the number one problem in the American economy because so many industries are linked to home ownership. According to government figures, there are nearly 10,000 home foreclosures taking place every day. This is a very serious problem that Congress must fix in the next thirty days because home ownership is the bedrock of America’s middle class. It is also the primary source for most local and state taxes. To allow millions of homeowners to be foreclosed on due to rigged sub-prime loans and a series of complex financial equations that baffle most economists is unfair and will undermine the American economy faster than any other single economic problem.

I recommend three steps to help solve our current economic crisis. First, Congress needs to immediately freeze all home foreclosure actions for one year and create a new agency, The Homeowners Resolution Trust Corporation (HRTC), which would purchase all troubled mortgages and renegotiate those loans with homeowners through local lenders and banks. By creating a one-year moratorium on foreclosures, the federal government can buy time to sort through all the troubled home loans, arrange for refinancing on those mortgages that can be salvaged, and retain the deeds of trust as a means to protect taxpayers from getting fleeced. This would give threatened homeowners some breathing room to resolve their financial problems. It would also allow local and state governments to recoup back taxes that homeowners have failed to pay. Finally, it would pump money into hundreds of local economies through local banks and credit unions that agreed to sell their troubled mortgages back to the HRTC and close their books on those mortgage loans. This step would give local banks more lending capital to revitalize local communities and small businesses. The HRTC would create federal standards and guidelines to ensure only valid mortgages are re-purchased by the HRTC from certified banks, credit unions, and other lenders.

Secondly, the federal government should tighten the requirements used by Freddie Mac and Fanny Mae for buying federally guaranteed mortgage loans. Just thirty years ago, prospective homebuyers had to meet very clear criteria before they could buy their dream home. We need to return to those days of fair and reasonable guidelines to ensure stability in the home purchasing process..

Thirdly, Congress should reinstitute stiff regulations and severe criminal penalties -- including prison time and hefty fines -- for those corporate officers and directors who violate SEC laws and try to fleece shareholders and taxpayers. The era of Anything Goes on Wall Street needs to end! Tough laws and enforcement by federal agencies can eliminate the shady dealers who are peddling under-valued derivatives and sub-prime loan schemes.

Those unscrupulous people who perpetrated this financial ponzi scheme on Wall Street would like us to believe that consumers, who purchased their homes on good faith and credit, are to blame for the current economic mess. But, Americans know better. The real culprits are the very people who are now crying ‘wolf’ and lobbying Congress -- and the American taxpayers -- to bail them out. You’ll see their ads in major newspapers and on the television networks. Beware of them. There are three culprits who got us into this pickle and now want us to bail them out. They include state and federal regulators who allowed banks to shift billions of dollars of questionable credit off their balance sheets and into the hands of unsophisticated foreign investors who were lied to. They also include hedge-fund managers and pension-fund managers who purchased sophisticated high-yield debt instruments they didn't understand and now cry mea culpa. Finally, we can blame the over-educated economists and bankers who fabricated mathematical equations and promoted their flawed lending models that enticed unsuspecting banks to purchase those high-yield debt instruments.

There’s no question that there is a hungry wolf out there. But, Congress should act cautiously as it attempts to sort through this economic mess. Certainly, we must avoid a credit meltdown. But, if Main Street can still function without burdening the American taxpayer with $700 Billion of Wall Street debt, perhaps logic and reasoning dictates we save Main Street and leave the bulls and the bears to the wolves.

About the Author. Thomas Hinton is president of the American Consumer Council, a non-profit consumer education organization with 85,000 members. He can be reached at: tom@americanconsumercouncil.org

Discovering Gold by Going Green

2008-08-02T09:43:00.000-07:00

It has taken corporate

America

nearly fifty years to climb aboard the Green movement. The primary reason corporate

America

ignored the cries of environmentalists, the United Nations, and green advocates was that no one in the Green movement was speaking their language. I’m referring to the twin engines that drive and sustain every business -- customers and profitability.

Now, corporations and national governments are finally getting the message and responding to Green initiatives. At the same time, consumers are stepping up their commitment to the Green Movement by purchasing products from green companies and adopting recommended practices to reduce their carbon footprint.

What caused the change on the part of business to go Green? Certainly, it took leadership from within. In 2005, when General Electric’s CEO Jeffrey Immelt announced his company’s major investment in green technology, companies decided to jump on the green bandwagon and find a way to make money. Within a few years, most companies have figured out how to make money from their Green initiatives. Soon, profits will follow.

National governments are also getting the message. A recent example are China’s leaders who have taken dramatic steps to reduce pollution in Beijing in time for the 2008 Summer Olympic Games. They understand that televised images of Beijing under clouds of toxic pollutants will hurt China’s prospects for foreign investment and tourism. China’s leaders also understand they must find a way to manage their rapid growth without incurring the wrath of Green leaders.

We’ve come a long ways since former first lady Lady Bird Johnson first raised our nation’s consciousness in 1964 to beautify America’s highways and public landscapes after being angered by the site of junkyards, billboards, and roadside litter. But, have we come far enough? Not really. There’s still much work to be done to ensure the continued viability of our natural resources and a healthy environment.

So, how can your business discover the gold by going green? Here are three proven ways to benefit from going Green:

1. Produce products and offer services that compliment the environment. It’s no surprise that gas guzzling vehicles like the once-envied Hummer are no longer selling. Consumers are turned-off by cars that are not fuel-efficient and pollute the environment. This is why hybrids and electric cars have waiting lists. Consumers want economical choices. Products that are biodegradable or compostable are also very popular among consumers as are organic restaurants and health-based grocery stores. Anything that legitimately touts the green label will catch the eyes of consumers -- even if it costs a few pennies more. Among service-driven companies that are making Green gains are hotel chains such as Starwood, Hilton, and Sofitels to name a few. Many hotels have taken steps to reduce their carbon footprint by conserving water and electricity, reducing the use of chemicals, educating employees on green practices, and encouraging guests to participate in their sustainability efforts. These positive measures not only make sense in terms of attracting more guests, but they are also good for the bottom line. A recent hotel industry report shows that during the last quarter of 2007, green hotels experienced a six percent jump in occupancy compared to their competitors who did not make a similar commitment to going green. This proves that consumers will support Green initiatives.

2. Tout your Brand’s Environmental Benefits. More businesses are promoting the environmental benefits of their products and services. Manufacturers of products ranging from hair spray to cereal have found a way to spin the environmental benefits of whatever they’re selling. Of course, consumers want to see the proof and not just the sizzle that claims that your products/services are environmentally-friendly. So, be prepared to prove your claims. This leads to the third factor.

3. Get Certified. The fastest way for any business to build credibility with consumers is to get certified by a legitimate green certification organization, or have its products certified. In the product certification area, there are several credible organizations that will review specific products against rigid standards that typically are linked to the ISO 14000 Environmental Management Standards. The most noteworthy are the LEED Program for new and existing buildings. This progressive program is sponsored by the non-profit U.S. Green Building Council. Green Seal is another reputable product certification organization. For companies and organizations seeking an Organizational Certification, the American Consumer Council is among the few non-profit organizations that provide an independent certification for companies that meet its rigid Green C Certification criteria. ACC also recognizes applicants that meet or surpass the Green C standards.

But, a word of caution… as more companies go Green, consumers need to be leery of unscrupulous marketers who simply want to position their products as politically correct without substantiating their commitment to environmental compliance or corporate social responsibility. This includes profiteers who masquerade as environmental auditors and self-appointed industry groups that are entering the certification business for only one reason -- to make a fast buck. That’s not to suggest that consultants and environmental auditors should be avoided. On the contrary. There are many reputable companies that can guide your company as it goes green. But, choose wisely and do your homework, Make sure any certification criteria will challenge your company to raise its environmental performance bar. Also, be sure consultants who claim to be auditors haven’t just hung out their shingle. Look for bona fide non-profit certification organizations or seasoned consulting practices that have a strong track record in this area.

Finally, be sure there is some kind of recognition component to your environmental certification process. This way, you will not only be doing good things for the environment, but you’ll also make your marketing team happy because they can leverage your Green achievements and showcase your best practices! This will give you a leg-up on the competition which translates to more customers and higher profits. Also, a Green Certification that has a strong public image will mean something to your customers and prospective customers.

About the Author: Thomas Hinton is president of the American Consumer Council which administers ACC’s Green C Certification Program. He is a popular speaker on Business, Environmental, and Corporate Social Responsibility issues. Mr. Hinton can be reached at: tom@americanconsumercouncil.org

Empowering Your People to Act

2008-06-15T13:01:00.000-07:00

by Bill Kalmar

I think most of us would agree that there are a handful of attributes that separate average companies from those that should be held up as role models. Some of those traits would be: a strong and achievable strategic plan, management interaction with staff and customers, well-trained employees, a passion for excellence, a silo-free organization, an open-door policy, and a team of professionals who are empowered to perform their job without constant management intervention, to name just a few.

Of all those traits, I would place empowerment at or near the top. Organizations that properly train and empower their staff operate more efficiently and do a better job of meeting and exceeding expectations of customers. There’s a minimum of lag time in resolving problems or disputes with customers because each employee can take the appropriate action without kicking it upstairs.

In examining the reasons for employees’ lack of power, one has to conclude that managers are afraid to let go of their decision-making domain. Carrying that concept a bit further, I contend that quality is greatly diminished in an organization unless people are empowered.

Most of us have at some time been involved in a transaction that required a company’s agent to seek guidance or approval or permission from another person. This is a time-consuming practice that irritates customers and humiliates employees because he or she realizes that they’re nothing more than a figurehead lacking authority to perform even the most mundane tasks.

Permit me to provide you with two examples of an extreme lack of empowerment. In my tenure as director of the Michigan Quality Council, my office was at a major university. Once when I needed a meeting room, the conference rooms in my department were all occupied, so I wandered onto another floor seeking an unoccupied room. There was an available room in the history department, but my request would have to be approved by the department head, who was out for the day. No one else could give the OK, because he hadn’t deputized anyone to act in his stead.

The receptionist said that if the Keeper of the Keys learned that the room had been used without his approval there “would be trouble.” Armed with that information and the theory that it’s “better to seek forgiveness than approval,” I used the room anyway, much to the dismay and consternation of the history department. For the absent professor, I left a short write-up on the advantages of empowerment with the receptionist. I wish he had responded.

The second example is from a national restaurant chain where my wife Mary and I frequently dine. As with numerous other dining establishments, this restaurant provides their guests with a card whereon visits are logged—after the purchase of eight meals you get a free dinner. We dutifully bring in our cards each time and have the cards stamped by the staff. After we surrendered our cards for a free meal, we discovered that the restaurant had exhausted their supply of new cards. We were to bring in our receipt at our next visit, when more cards would have arrived. I’m nosy, so I asked why someone hadn’t noticed earlier that the supply of cards was low and ordered more.

It seems that a vice president at headquarters, let’s call him the King of Cards, is the only person responsible for ordering these cards. All requests have to be routed through the king, who then doles out the cards to the various restaurants. My suggestion that each restaurant be responsible for ordering its own cards met with agreement from the restaurant management, but as in many organizations, altering an existing procedure through a labyrinth of senior management is cumbersome and difficult. I’d like the Keeper of the Keys to meet with the King of Cards and see what other blockades they could invent to stifle productivity. Both of these management dinosaurs should be jettisoned from their organizations, or at least made to write the phrase “Empowering my staff adds to customer and employee satisfaction” a thousand times on a blackboard.

Baseball and showerheads
Motoring to New York recently to watch the Detroit Tigers play the Yankees at Yankee Stadium taught me two life lessons: Mayor Michael Bloomberg is genuinely a man of the people, and when it comes to height standards at a national hotel chain, size does matter. Permit me to explain.

For my 65th birthday my son and I attended opening day at Comerica Park in Detroit. The Tigers lost but the day was salvaged when my son presented me with tickets for an upcoming Tigers/Yankees game in New York on his birthday and, as most baseball fans know, this is the last year for The House That Ruth Built—Yankee Stadium.

I wanted to surprise my son with upgraded seats, so I contacted Mayor Michael Bloomberg, Governor David Paterson, and Yankee owner George Steinbrenner and suggested that, if their seats for the game weren’t being used, perhaps a couple of out-of-town fans could be the new occupants.

Well-run organizations always respond to customers whether by phone, e-mail, or snail mail. I have made a habit of contacting organizations when I receive excellent service or when I have a complaint. Organizations that value their relationships with customers always respond, and those are the ones that retain my business and admiration. Then there are the companies that never acknowledge the contact, and that tells me everything I need to know about the management. Their lack of concern cascades onto everyone in the organization. No wonder service is shoddy.

Mayor Bloomberg took the time to respond, stating that he in fact doesn’t have season tickets but he sent a personalized letter to my son for his birthday hoping that he would enjoy his stay in New York. This reflects why he’s so revered in the Big Apple. On the other hand, judging from the poor condition of the reserved box seats, Bloomberg may be waiting for the new stadium to purchase season tickets.

We never received the courtesy of a response from Steinbrenner or Paterson. I realize that both of them receive numerous letters and requests every day but a simple “No, are you crazy?” response to my letter would have been a nice gesture. So Bloomberg goes to the top of my list of world-class mayors.

Let me say at the outset that the staff, the ambience, the food, and the surroundings at the Hampton Inn were first class. What was a bit disturbing was the showerhead, of all things. Entering the shower in the morning was like being a Lilliputian in a Brobdingnagian world. I’m 5'10", and the showerhead was positioned so high that I could adjust the water stream only by standing up on my toes. I’d just turned 65 and already I seemed to be shrinking. Upon checking out later that morning, I mentioned my experience to the front desk staff. Their response was simple and straightforward: Hampton Inns had done a survey and determined that the majority of their business traveler guests were 6'2", and the showerheads were adjusted to accommodate them. They raised the sinks, too.

I sent an e-mail to Hampton Inn management regarding this incident, which elicited the following response from the general manager: “Please accept my apologies for any inconvenience you experienced with our showers. Our hotel was constructed to Hampton brand standards, which specify showerhead heights. Until these specifications change, a solution would be to request a room with accessible features that have handheld showerheads”. In response I asked what would happen if I returned with a broken arm. How would I hold the shower wand, and would the hotel supply someone with a loofa to help me bathe. As with Steinbrenner and Paterson, I haven’t received a response.

All in all, it was a great trip. The Tigers swept the Yankees, and I’m doing stretching exercises in the event we return to New York and I need to take a shower.

As you read this, I’m resting comfortably after June 2 robotic prostate cancer surgery at Henry Ford Hospital in Detroit. The hospital is the pioneer in this type of surgery, having performed more than 3,000 such operations for people from all over the world, so I knew I was in good robotic hands. What makes it even more appealing (if surgery can be appealing) is that the hospital has partnered with the local Ritz-Carlton Hotel and thus patients for this procedure are transported back and forth to the hospital by hotel staff, and special arrangements are made at the hotel for pre- and post-surgery dietary needs. If one has to experience this type of operation—I’m told one in six males will—it’s comforting to have the best at one’s disposal.

As I relax in my hammock contemplating my next column, I just might arrange for a conference call with the Keeper of the Keys and the King of Cards so we can discuss empowerment. Wouldn’t that be a hoot?

About the author
William J. Kalmar has extensive business experience, including service with a Fortune 500 bank and the Michigan Quality Council, of which he served as director. He has been a member of the Malcolm Baldrige National Quality Board of Overseers and a Baldrige examiner. He’s also been named quality professional of the year by the ASQ’s Detroit chapter. Now semiretired, he’s a freelance writer for the Detroit News and writes a monthly column for Mature Advisor newspaper. Kalmar is a mystery shopper for several companies and a frequent presenter and lecturer. He also does radio voice-overs and competes in duathlons.

How to Avoid Green Schemes When Getting Green Certified

2008-06-11T08:43:00.001-07:00

by Thomas Hinton

Last week, during a speech to business executives, I was asked about the proliferation of Green schemes and how a company could evaluate the credibility of a Green Certification Program. Given the number of misleading web sites and schemers who are trying to make a fast buck from the Green Movement, here are five questions your company should ask before applying for a Green Certification program.

1. Is the Green certification program sponsored by a credible non-profit organization?

I strongly encourage companies to avoid for-profit ventures that claim to offer certification programs but, in fact, are fronts for some money-making scheme. The leading Green Certification programs are administered by viable non-profit organizations or associations that are legal entities and led by volunteers and a professional staff. Most non-profit organizations have been established for the public good and have bylaws and members. While non-profit organizations will charge a fee for their certification program, they do so to sustain their programs and pay their professional staff. Among the leading non-profit organizations that offer outstanding Green certification programs are the U.S. Green Building Industry Council, the American Consumer Council, the Forest Stewardship Council (FSC), Green Steam, and Green-e, which is operated by the Center for Resource Solutions. They are many more credible non-profit organizations, but these non-profit organizations are leading the way in the area of Green Certification.

2. Does the Green Certification program have written criteria and standards that govern the application and certification process?

Yesterday, someone sent me a link to an online green certification program managed by a mom-and-pop website. The alleged certification consisted of 32 yes/no questions. If the applicant answered a majority of the questions correctly, they earned the right to affix the website’s green-certified logo on their company materials. This type of green certification is bogus and does a disservice to the many valid green certification programs that have formal criteria and rigorous standards. Any Green Certification program that does not require your company to complete a detailed application and respond in-depth to serious questions regarding environmental compliance and sustainability is suspect. I should note that Green Certification for a specific product is even more rigorous and often requires some type of ISO-related certification compliance.

3. Does the Green Certification Program have a verification and validation process as part of its certification?

Two common elements among all credible sponsors of a Green Certification program are the verification and validation of the information contained in a company’s application for certification. In order to verify and validate the contents of a company’s application, an independent team of assessors or auditors is trained and certified to review the contents of the application against the criteria and, in some cases, conduct a site visit to verify that certain claims by the applicant are, in fact, being performed.

The certification of assessors or auditors should be done by the sponsoring organization or the American National Standards Institute (ANSI). In the case of the American Consumer Council, our Consumer Green Council is responsible for recruiting, training, and certifying its Assessors. Only then are certified Assessors assigned to review an application. Also, an independent Board of Judges reviews all recommendations for certification prior to any certification being awarded. In this way, there can be no collusion or conflicts-of-interest. This process ensures that only qualified applicants receive ACC’s Green C Certification designation. Other non-profit organizations have a similar process in place to ensure the integrity of their certification program.

4. Once your company is Green Certified is there an accountability step and a process for continuous improvement?

The most progressive Green Certification programs not only have contemporary standards and a strong verification process, but they also have a way to hold certified companies accountable to those standards after certification has been earned. In other words, a company cannot earn its Green certification and then engage in practices that violate the spirit of the certification program. Organizations like the Forest Stewardship Council (FSC) and the American Consumer Council have high standards in this regard and frequently review the practices of certified companies to ensure they are in compliance and striving to reach higher levels of certification.

5. Does the Green Certification Program have credibility in the marketplace?

Let’s face it, most companies are not altruistic. Very few businesses decide to go Green because they want to save the rain forests. Instead, their motives range from increasing their profits to boosting market share. Frankly, that’s fine. As long as there is integrity in the certification process, it doesn’t matter what motivates a company to get certified.

Based on my observations over the past few years, I can say that consumer acceptance of a brand or product that bears the Green C certification (or some other Green designation) is a strong reason for any company to go Green and get certified.

I’ve also witnessed an interesting transformation among executives as their companies go through a Green certification program. Typically, three things happen to executives. First, they begin to truly appreciate the growing number of Green Consumers and their purchasing power. Secondly, they begin to understand that their company is capable of doing many small, but significant things, to sustain our natural environment and planet. Thirdly, executives realize that their employees genuinely care about our planet and going Green is a smart way to engage employees in the workplace and stimulate innovative solutions to reducing costs and making their company more efficient.

About the Author: Thomas Hinton is president of the American Consumer Council and serves as the executive director of the Consumer Green Council, which administers ACC’s Green C Certification Program. He can be reached in San Diego, California at tom@americanconsumercouncil.org

Lufthansa Airline Is Customer-Focused

2008-05-13T11:24:00.001-07:00

by Thomas Hinton

Recently, I flew Lufthansa Airlines round-trip between Los Angeles to Frankfurt. While I have traveled internationally many times, this was my first international experience with Lufthansa. Given the mediocre in-flight service I’ve received from various U.S. carriers in both coach and business class, I must confess my expectations for Lufthansa were not very high. Boy, was I surprised! Not only were the Lufthansa airport representatives and in-flight personnel exceptional, their courteous service in both coach and business class exceeded my expectations.

While courtesy, kindness, and in-flight comfort aren’t rocket science, very few airlines have mastered these simple pillars of superior customer service. It’s too bad because studies show that good service breeds customer loyalty. Lufthansa understands this simple equation because Lufthansa has analyzed its’ in-flight customer experience and determined how to make a ten hour flight a pleasant experience instead of agony and torture like many of their competitors.

I realize there are certain costs associated with providing passengers warm hand towels, a free glass of wine, complimentary newspapers and magazines, and in-flight entertainment programs including two movies. But, these simple in-flight niceties demonstrate that Lufthansa has moved beyond the “bean counter mentality” and makes operational decisions using a higher principle. That principle, namely, is customer satisfaction! Lufthansa has figured out that customer loyalty generates repeat business and repeat business is money in the bank!

While there’s still (leg) room for improvement -- especially in terms of the leg room and hobbit-sized seats most airlines use in coach class -- I think Lufthansa earns kudos for its exceptional service and challenging its airline competitors to raise the customer service bar! I look forward to my next exceptional experience on Lufthansa!

About the Author: Thomas Hinton is president of the American Consumer Council, a non-profit consumer education organization that represents 85,000 consumers in North America and administers ACC's “Green C” Certification Initiative that promotes environmental compliance and sustainability for businesses, non-profit organizations, and government agencies. He can be reached at tom@americanconsumercouncil.org

Not Another Survey!

2008-04-16T17:13:00.000-07:00

by William J. Kalmar

As customers, we have all come to understand the importance of customer surveys. Customers are the lifeblood of any organization and to achieve a certain level of success, the needs, wants, and expectations of customers must be understood. Role-model companies exceed the expectations of customers.

My take on the subject of customer surveys is fairly simple: No new product or service should be launched without first involving customers in a review process. Failure to do so could result in a process that is shunned by your clients or, worse yet, in customers flocking to another company.

The Checkbook Debacle
Let me give you an example of just such a scenario. When I worked for a large national bank, we prided ourselves in having an extensive training program modeled after the Malcolm Baldrige National Quality Award. The goal was to introduce every employee in the organization to the Baldrige criteria for performance excellence. The training went on for years, and we emphasized the concept of being in lock step with customers.

Somewhere along the line, we lost sight of this very important concept when it came to something as mundane as new checkbook orders. Our demand deposit department, in meeting with a vendor, learned that by eliminating one style of check reorders, the bank could save $500,000 a year. It meant that instead of offering side- or top-stub tear offs, we would only be offering checks that were attached to the stub across the top. Now $500,000 is nothing to take lightly, so it was full steam ahead to implement this new process.

Well, guess what? When customers began to reorder checks and discovered that their favorite way of tearing checks from the folder had been eliminated, there was an uproar. The branch offices were filled with irate customers, and phone lines in the customer service areas were swamped with customers threatening to move their funds to banks that offered both features.

Someone in management asked for the customer survey that was done before we made this change--of course, there wasn’t one. The bank quickly retrenched and again began offering both features for check reorders. The upside was that we used this as an example of what happens when customers are not brought into the brainstorming process. Weighing the loss of many customers and good will against a savings of $500,000 was a no-brainer.

Health care Focus Group:
As a follow-up to this concept of customer involvement, I recently participated in a focus group staged by a major health care company. The organization was exploring the introduction of some new products that would supplement Medicare. There were ten of us in the group--people who had just signed up for Medicare and others in the throes of reviewing their various options. I have participated in many focus groups over the years, and this one stood out: It was well organized, it kept on point, and it paid each of us $75 at the conclusion of the two-hour session. (Expediting the payment for our involvement was key in my accepting a role in the focus group, which I will expand on.)

As I participated in the roundtable discussion, my thoughts wandered off to this article on customer surveys. As a result, I concluded that more organizations should avail themselves of this technique before launching any new product or service. The participants represented a cross-section of the target audience, and the participants were allowed to voice opinions on subjects not originally outlined in the instructions. The health care organization came away from this with a clear understanding of the expectations of its customers.

Various Paths to Information
Other organizations have approaches to surveying customers as varied as the organizations themselves. In addition, we as consumers often look to the results of survey recommendations before we buy a particular product or service. How many of us have viewed a movie only because it was given “two thumbs up” by a certain pair of reviewers? How often have we eaten at a particular restaurant or stayed at a resort because a survey has designated it four stars? As consumers, we seem to depend on survey results to guide us to the best establishments. Let’s examine for a moment how some of these establishments entice us to participate in their surveys.

I mentioned earlier that the focus group I was involved with provided us with payment, as promised, at the conclusion of the session. In fact, being the cynical person that I am, my participation hinged on their paying me for my time and doing so at the end of the session. As a retiree I no longer offer advice pro bono.

Many companies conduct customer surveys on their receipts. Here is just a small sampling:

• OfficeMax--”Tell us about your shopping experience and enter to win one of five prizes.”

• Walgreens--”How are we doing? Enter our monthly cash sweepstakes. This month the prize is $3,000 cash.”

• Panera Bread (Saint Louis Bread Co.) --”Tell us how we are doing and you may win $2,000.”

• Montana ’s Cookhouse -- ”Please tell us about our serv ice and you could win $1,000.”

• Caribou Coffee Co. --”Tell us how we are doing. We would like to hear about your Caribou experience. Enter our monthly sweepstakes. Ten $100 Caribou Coffee gift cards awarded monthly.”

• Romano’s Macaroni Grill --”Win $1,000--a winner every week.”

• Meijer--”How are we doing? Rate your shopping experience and you may win a $1,000 gift card.”

Are you seeing a pattern here? These companies want our opinions, and if we participate, we may win a prize. Candidly, I am not inclined to assist them, because, as I mentioned earlier, I am somewhat mercenary: I want instant gratification. When I complete the survey, I want a coupon that I can download for a free coffee at Caribou, or a complimentary donut at Panera Bread, or a $5 coupon at a department store.

Here’s my quandary: While at each of these establishments, I have queried the employees about these surveys and information on any of the winners, and to date no one has been able to share with me the names of winners, or details of any payouts. Do I think that these promotions are bogus? Well, until someone comes forward to contradict it, my answer is yes! Therefore, don’t expect me to spend my time commenting on my veal piccata at the Macaroni Grill unless there’s a complimentary cannoli in it for me.

Some companies that have survey information on their receipt and promise nothing--Kohl’s, Macy’s, and On The Border, to name just a few--are saying, “We want your opinion and feedback, but unlike other companies who promise you a chance at a prize but may not deliver, we are being straightforward in telling you that there is no prize. The prize will be better customer service if you participate.”

These are what I would call after-the-fact surveys. I think a more effective way of exploring the needs, wants, and expectations of customers is to survey them while they are involved in the service or sampling the product. I call this method on-site, live surveys. A company that does it best in my estimation is the two-time winner of the Malcolm Baldrige National Quality Award--The Ritz-Carlton Hotel Co. Let me give you a recent example of this methodology.

It’s no secret that the “Ladies and Gentlemen” (as the staff are called) of the Ritz-Carlton constantly update a guest database that contains each guest’s special preferences. For instance, if a staff member notices that a guest prefers a specific wine, that information is entered into the database so that upon a return visit, a similar bottle of wine will be in the room upon check in. Permit me to provide you with a couple of personal examples.

While dining at our local Ritz-Carlton in Dearborn, Michigan, I opted for an appetizer of scallops. Our waitress overheard me remark to my wife, Mary, that “these are the best scallops I have ever eaten.” Evidently that information became part of the on-site, live survey information that was entered into the database, because every time we dine at a Ritz-Carlton establishment, I receive a complimentary scallop appetizer.

Then there’s the incident that occurred about a year ago that to this day still resonates with me. Mary and I periodically enjoy high tea at the Ritz-Carlton. It’s decadent, very soothing, and relaxing. On one occasion I requested extra finger sandwiches. Our waitress, a lovely lady named Anoushka, smiled and kept bringing me the sandwiches, much to my delight. Moving the calendar up two months found Mary and me enjoying another high tea. As we sat down, our waitress came up to us and said, “Anoushka is on vacation in Florida, but she called moments ago to make sure we provided you with extra finger sandwiches.” Now that’s service and an example of taking survey information to the next level. Is it any wonder that the Ritz-Carlton regularly ranks at the top of surveys when it comes to meeting and exceeding guests’ expectations?

Rather than survey guests at the conclusion of their stay, this hotel conducts surveys on an ongoing basis. This is a methodology that other companies should implement because it demonstrates to current customers that they are valued. The hotel also provides survey cards in each room.

Besides surveying customers about their services, many organizations hire mystery shoppers to conduct on-site reviews. I am one of those mystery shoppers. My responsibilities include visiting restaurants, fast-food chains, national department stores, and even a national transportation company. What I have been most impressed with is that clients take it as a given that their food is going to be delectable or that their products will be care-free, so the emphasis is on customer service. Naturally I review the food and the products, but the bulk of my report is about interacting with the employees. Absent great service, it doesn’t matter how good the food is or how sound the products. If employee service is mediocre, customers don’t return.

Conclusion
It is critical to be in lock step with your customers, and there are myriad ways to do so. Each organization needs to establish a pipeline of information from its customers and then make sure that those needs are met or exceeded so that the company will attain legendary status. Don’t get caught up in some money-saving gimmick without first surveying your customers.

Also, please don’t provide me with a receipt and a chance at a cash prize. If you want my opinion or feedback, I prefer a reward on the spot--a coupon for a free dessert or a free coffee would make my day.

Well, time to go. I have to complete a survey from the local hospital where I was a patient recently. They are offering a drawing for a free lobotomy. Who knows, it might just be on the level. If I win, it would be an opportunity to somehow put this dreadful, frigid, Michigan winter out of my mind.

About the Author:
William J. Kalmar has extensive business experience, including service with a Fortune 500 bank and the Michigan Quality Council, for which he served as director. He has been a member of the Malcolm Baldrige National Quality Board of Overseers and a Baldrige examiner. He’s also been named quality professional of the year by the Detroit Chapter of ASQ. Now semi-retired, he’s a freelance writer for the Detroit News and other national newspapers; serves on the USA Today vacation panel; writes a monthly column for Mature Advisor newspaper; writes a monthly column titled “Hammock Thoughts” for Quality Digest’s e-newsletter QualityInsider ; is a mystery shopper for several companies; is a frequent presenter and lecturer; does radio voice-overs; and competes in duathlons.

The United States Air Force Shoots Down Boeing

2008-03-10T15:00:00.000-07:00

by Tom Hinton

Last week I watched the Congressional hearings on why the U.S. Air Force awarded a contract to Northrop Grumman Corporation and EADS North America to build its next-generation of aerial refueling tankers. The contract is estimated at $40 billion, and the deal includes 179 planes to be delivered over the next 15 years.

The Air Forces opted to give the new kid on the block a chance over the more experienced Boeing Company which has been building air tankers for 75 years and recently unveiled its new, state-of-the-art KC-767 which has already been delivered to Italy and will soon be delivered to Japan. What do these countries know that our own United States Air Force doesn’t?

For the record, EADS is part of Airbus, the foreign-owned and heavily subsidized aerospace giant. It is also The Boeing Company’s toughest competitor for military and commercial airplanes. It should also be noted that the initial Air Force contract will create an estimated 20,000 jobs -- including several thousand jobs in Alabama and Kansas -- while costing Boeing and its suppliers approximately 20,000 jobs in the state of Washington and other locations where is has facilities and suppliers who would build the KC-767 air tanker.

The Boeing Company estimates that if the Air Force moves forward with the contract award to Northrop Grumman and EADS -- and Congress approves the bid award -- some 40,000 jobs (current and new positions) will be affected in the United States. The EADS tanker airframe is based on an Airbus A330 commercial jet assembled in France; and, most of the assembly work would be done in Europe according to Northrop Grumman sources.

As I watched the congressional hearings I shook my head in disbelief. The U.S. Air Force’s top acquisition officers, led by Assistant Secretary Sue Payton, Lt. General John Hudson, and Program Manager Terry Kasten and answered the panel’s questions honestly and directly. They staunchly defended the bidding process, the contract review process, and the awarding of the contract based on the proposal criteria. But, they also acknowledged that certain criteria such as jobs and the economic impact to American workers, were not part of the proposal and, therefore, were not evaluated or considered as part of their review. As Assistant Secretary Payton told Congress, “jobs and economics are not part of the proposal criteria or bidding process.”

While I understand the Air Force must follow specific criteria and acquisition laws, it begs the question, why in the world is the U.S. Department of Defense undermining the American economy? This is like giving a child a loaded gun and then advising them not to shoot you! It makes absolutely no sense to the average American who is worried about jobs, industrial capacity, and making ends meet. Now, America's own military is shipping jobs overseas. I could understand their rationale if Boeing was incompetent, but it is not. In fact, Boeing’s Airlift & Tanker program continue to be recognized as a best-in-class company by no one less than the president of the United States who recognized The Boeing Company on two occasions with the Malcolm Baldrige Award, our nation’s highest presidential honor for workplace excellence.

So, let’s examine the impact of this decision and how it all came about. The current air tanker tango began in 2003 when Arizona Senator John McCain complained bitterly about pork barrel politics because the Air Force was about to award The Boeing Company a new air tanker lease contract. Never mind that Boeing had been building and supplying the Air Force with air tankers for over 50 years. McCain said the deal was wrong.

According to the Everett Herald, Senator McCain "nearly single-handedly killed Boeing’s multi-billion dollar deal" to lease 100 Boeing air tankers to the U.S. Air Force. As the Everett Herald explained, “In 2001, McCain's laser-like probe of defense budgets unearthed a $30 billion earmark to pay for leasing 100 KC-767 jets from Boeing -- without first following a competitive bid process. McCain’s criticism stopped the program three years later and caused a round of investigations that led to Boeing paying fines for its contracting practices, and major changes in the Air Force’s procurement and contracting procedures.

Subsequent federal investigations resulted in two Boeing executives, Chief Financial Officer Mike Sears and Darleen Druyun, a former Air Force Acquisitions official and then-vice president of missile-defense systems at Boeing, being fired for illegal actions relating to Air Force contracts. Druyun was also convicted of federal violations for her illegal actions and was fined and sent to prison.

Boeing's board of directors acted quickly after concluding Sears improperly offered Druyun a job in the fall of 2002 because Druyun worked for the Air Force. At the time, Druyun was reviewing the proposal for the Air Force to lease 100 Boeing 767 airborne-refueling tankers. Needless to say, these Boeing officials made a serious mistake and paid the price for their stupidity and illegal actions.

Boeing hired a new CEO and hoped the firings would convince Congress and the Defense Department that the company was acting decisively to right its ship. Then, the Pentagon stripped Boeing of $1 billion worth of satellite launches after another investigation showed the company used trade secrets stolen from Lockheed Martin, its chief competitor, to help win the launches. Instead of getting better, hings got worse for Boeing.

In March, Boeing Satellite Systems acknowledged it made improper technology transfers to China in the wake of two failed satellite launches in 1995 and 1996.

Finally, in 2006, when Boeing’s new chairman W. James McNerney, Jr. appeared before Congress and apologized at a Senate hearing for the company’s illegal and unethical tactics, and promised higher ethical standards, Senator McCain responded with praise for Boeing for "truly reforming and starting fresh."

But, the damage was done and Senator McCain had sent a clear signal to the U.S. Air Force Acquisition office -- no more deals with Boeing. That set the stage for a new round of air tanker bids which last week the Air Force awarded to Northrop Grumman Corporation and EADS North America. While the letter of the law was followed, it appears from circumstantial evidence that the U.S. Air Force had already made up its minds not to do business with Boeing’s Airlift & Tanker program.

In the midst of all these investigations and problems with a few bad apples at Boeing, Senator McCain and his colleagues forgot to ask one important question: “If not Boeing, who else will build the Air Force’s new air tanker?” But, McCain knew the answer was the Europeans and Airbus. He also knew his actions would cost some 20,000 Americans their livelihood. Certainly, McCain's tactics pushed the Air Force too far and caused them to avoid steer clear of doing business with Boeing. That's a serious mistake on the part of the Air Force and Senator McCain.

Rep. Norm Dicks, a powerful figure on the House Appropriations Committee, who represents the Everett, Washington area which his home to many of Boeing’s aerospace workers, predicted a "firestorm of criticism on Capitol Hill" over sending so many jobs overseas. Rep. Dicks added of McCain: "I hope the voters of this state [Washington] remember what John McCain has done to them and their jobs."

Some people suspect that this was “payback time” for The Boeing Company. But, Assistant Secretary of the Air Force Sue Payton said in her testimony that previous contracting issues and illegalities with Boeing had no bearing on the 2008 air tanker award. She indicated that Northrop Grumman Corporation and EADS North America won on the merits of their plane, a modified Airbus A330 that is bigger than the modified KC-767 that Boeing offered. Payton also noted that by law, the Air Force must consider European allies on equal footing with American manufacturers.

Assistant Secretary Payton is referring to laws such as The Buy American Act (41 U.S.C. § 10a–10d) which was passed in 1933, mandating preferences for the purchase of domestically produced goods in direct procurements by the United States government.

The section of The Buy American Act that the U.S. Air Force referenced in terms of the air tanker contract is an outdated provision which stipulates that foreign companies can be considered when “purchasing the material domestically would burden the government with an unreasonable cost (the price differential between the domestic product and an identical foreign-sourced product exceeds a certain percentage of the price offered by the foreign supplier), if the product is not available domestically in sufficient quantity or quality, or if doing so is in the public interest…”

Given the fact that The Boeing Company already has built a new air tanker, The Buy American Act is ridiculous and works to the detriment of America’s economy and declining manufacturing base. While the U.S. Air Force must adhere to the law, Congress should move immediately to strike The Buy American Act and ask the Air Force to re-bid the job so that Boeing has a fair chance -- assuming fairness is even possible given the McCain bias against Boeing now rooted in the U.S. Air Force.

It;s important to note that EADS, is a European entity that is heavily subsidized by foreign governments. The Boeing Company does not enjoy any government subsidies, so the playing field is not level. Already, the competition is unfair. The Boeing Company cannot compete fairly against such rules and antiquated laws that work against the competitive spirit of American businesses.

Another concern was raised by Congressman Dicks, who accused the Air Force of “bait and switch tactics” by telling Boeing that the Air Force wanted a medium-sized tanker, not a larger tanker which Airbus proposed. Then, the Air Force accepted a larger aircraft from Airbus, the modified A330. “Had Boeing known that the Air Force wanted a bigger jet, Boeing would have bid the 777," Rep. Dicks said at the Congressional hearing last week.

Interestingly, while Boeing was building the KC-767 tankers for Italy and Japan, it asked the Air Force if it wanted something bigger in its new air tanker -- like the Boeing-777. The Air Force told Boeing no, But then, the Air Force proceeded to select a tanker based on the airbus A330 specifications which is larger than Boeing’s 767 and almost as large as the 777. This is why Rep. Dicks accused the Air Force of “switch and bate” tactics -- accusing the Air Force of saying one thing to Boeing but doing another in dealing with Northrop Grumman Corporation and EADS North America. It appears the Air Force was not dealing honestly with Boeing because of the pressures from Senator McCain.

In awarding the new air tanker to Northrop Grumman Corporation and EADS North America, other questions have been raised by aviation experts as to whether the Airbus A330 is going to fit into Air Force infrastructure including airplane hangars that currently house KC-135's that use half the space. When the two planes are compared size-wise, the wingspan of the airbus is 42 feet wider than the 767. The airbus plane is also 34 feet longer and seven feet taller at the tail.

"You're going to need massive construction plans to rebuild hangars at airbases all over the world," complained Rep. Dicks.

Secretary of the Air Force Wynn defended the contract decision and told senators the planes were judged on nine key criteria and "across the spectrum, all evaluated, the Northrop Grumman airplane was clearly a better performer." In addition, he said the Boeing proposal was judged to be more risky and more expensive.

But, this statement also raises questions among Aviation experts who noted that the Boeing contract bid was considerably lower than the EADS bid, and the Boeing aircraft is already operational while the airbus KC-45A is still is the design phase.

Also, it has been noted that Boeing’s Airlift & Tanker program has won the prestigious Malcolm Baldrige Award for its quality and overall excellence.

The Air Force has complained that it is still flying Eisenhower-era air tankers built by Boeing and it needs to replace its aging fleet as soon as possible. If this is the case, experts ask, why delay the process when you already have a reliable, state-of-the-art air tanker being built by Boeing?

Finally, what about American jobs being shipped overseas to build a U.S. Air Force air tanker? Does this make any sense given the state of our economy and the need for skilled aerospace workers such as those employed by Boeing?

Responding to criticism of the contract award, Northrop Grumman officials said the KC-45A tanker will produce 2,000 new jobs in Mobile, Ala., and support 25,000 jobs at suppliers nationwide. The EADS/Northrop Grumman team plans to perform its final assembly work in Mobile, although the underlying plane would mostly be built in Europe, and it will use General Electric Co. engines built in North Carolina and Ohio.

While Northrop Grumman Corporation and EADS North America are good companies, this decision has made many Americans angry, and rightfully so. It smacks of politics and unfair competition which is exactly what the U.S. Air Force should be avoiding.

Boeing’s past acquisition mistakes have been corrected and paid for, literally. Boeing has been under new, leadership since 2006, and Boeing’s Airlift & Tanker program is second to none in terms of quality, business practices, and overall management excellence. If the United States Air Force is prohibited from considering economic factors, certainly the United States Congress and White House need to get their heads out of the clouds and step-in to make sense of this decision before Northrop Grumman Corporation and EADS North America fly away with American jobs and taxpayer dollars!

About the Author: Tom Hinton is president of the American Consumer Council. He can be reached at: tom@americanconsumercouncil.org

Southwest Sacrifices Airline Safety for Profits

2008-03-08T20:30:00.000-08:00

by Tom Hinton

Over the years, I’ve admired Southwest Airlines for doing things right. It seemed that when other airlines were lowering their standards and compromising their commitment to service and quality, Southwest Airlines struck to its knitting and honored its words and promises to customers. In the process, Southwest created a successful and profitable airline. By offering low fares, frequent flights, a strong safety record, and motivated employees -- who had fun on the job and cared for their customers -- Southwest Airlines became one of America’s most admired companies and desirable places to work.

Now, Southwest is under fire by Congress, consumer groups, and the FAA for allowing more than 100 un-inspected planes to fly despite the fact that some planes had cracks in their fuselages. Four jets were found to have four-inch cracks requiring immediate repair. Six jets had signs of cracks starting to show.

Southwest admits that it allowed its planes to fly with cracks, but denies that it ever placed its crew or passengers in jeopardy. In a statement addressed to its customers, Southwest Airlines said, "We assure our customers that this was never a safety of flight issue." Aviation experts told NBC News that the early damage would not be catastrophic, but cracks could lead to serious problems.

Inspections of airplane fuselages became mandatory in 1988 after an Aloha Airlines Boeing-737 jet cracked open at 24,000 feet while enroute from Honolulu to Hilo killing a flight attendant and injuring seven of the 89 people aboard. Ironically, a passenger noticed a sever fuselage crack as she stepped aboard the Aloha Airlines jet in Honolulu, but never mentioned it to the flight crew.

To its credit, Southwest discovered the inspection oversight and notified the FAA. But, for reasons not explained, Southwest continued to fly the un-inspected planes on more than 1,400 flights. Federal law requires that planes be grounded until they are in compliance. Southwest cooperated with the FAA throughout the inspection process and told the media is was surprised when the FAA proposed a $10.2 million fine for violating federal regulations.

Is this just a series of misunderstandings and communication breakdowns, or is it -- as the head of a congressional committee suggests -- collusion between the FAA and the airlines it’s supposed to regulate?

Rep. James Oberstar, who chairs the U.S. House of Representatives’ Transportation and Infrastructure Committee, believes the FAA and the airlines have become too cozy. Oberstar said the committee's investigation was begun after two whistleblowers approached congress after years of trying to correct the inspection problems.

Oberstar called for the FAA to "clean house from top to bottom.” According to Rep. Oberstar, “the relaxed relationship between the FAA and the airlines have led to the sort of lax enforcement that allowed Southwest Airlines to fly at least 117 aircraft past mandatory inspection deadlines.”

Oberstar also said he believes similar violations may have occurred involving other airlines, but that those persons who have such evidence are afraid to come forward. What does this disturbing situation say about the integrity of senior management at the airlines and the independence of regulatory agencies like the FAA? Should consumers be worried? The short answer is a resounding yes! The reason is a lack of trust and integrity on the part of airline executives and the FAA.

When government agencies such as the FAA, the U.S. Consumer Product Safety Commission, the Food and Drug Administration, and the U.S. Department of Agriculture are compromised to the point where leaders fail to lead objectively, and government inspectors fail to perform their duties and uphold the sacred public trust, it is time to “clean house” and change the culture of those organizations as Rep. Oberstar suggests.

What is happening here is more serious than just coziness and a few omissions by business leaders and government agencies. What is happening here is a blatant disregard for consumer safety and the welfare of our citizens. If warranted, the Department of Justice and federal prosecutors should be asked to investigate and bring criminal charges against those government officials and corporate leaders who knowingly abused the law and abdicated their sworn responsibility to the public by placing an unsuspecting public in danger. In China, they shoot officials who disgrace their office and disregard the public good! While such penalties are extreme, a harsh message needs to be sent to those men and women we have entrusted with the safety of our airlines, drugs, food supply, and products. That message is simply this: honor your oath by doing your job; and, uphold the laws you swore to obey and enforce. If you cannot do this, quit your job. If you fail to uphold the laws, you run the risk of federal prosecution and prison.

I believe this is where the Southwest Airlines incident crosses the line. When airline executives knowingly thwart the law and risky public safety, it is criminal intent. You cannot convince me that Southwest Airlines, which is managed by hundreds of intelligent and competent people, overlooked one of the basic safety issues of an airline -- compliance with FAA inspections. It is no longer a matter of sloppy documentation and lax oversight; it is criminal behavior on the part of Southwest Airline executives and FAA inspectors who looked the other way. Rep. Oberstar is correct in calling for a top-to-bottom investigation. In order to stop these types of blatant violations, it will require much more than a slap on the wrist. Southwest and the FAA must be held accountable to the full extent of the law.

About the Author: Tom Hinton is president of CRI Global, LLC, a training and consulting firm that helps its clients create a “Culture of Excellence” in the workplace. He is the author of four books and a popular speaker at corporate and association meetings. For information, email him at: tom@criglobal.com or visit: www.tomhinton.com

What Makes A Good Employee?

2008-03-04T15:24:00.001-08:00

by Bill Kalmar

May I have the envelope, please!

Each year at this time a momentous event is announced in the pages of a prominent magazine. No, I’m not talking about the Sports Illustrated swimsuit edition, although thoughts of that warm me up on frigid evenings in Michigan (sorry if that’s sexist). I’m referring to Fortune Magazine’s announcement of “The 100 Best Companies To Work For.”

For us quality and customer-service geeks it’s an opportunity to examine the inner workings of some of the best organizations in our nation. For the companies who applied for this recognition it’s a guessing game to see where they rank among some of their peers and who is labeled No. 1.

Ever since this list was first published I’ve been following and reviewing these companies like a broker follows blue chip stocks or a wine connoisseur absorbs Wine Spectator’s list of the top bubbly. We all want to work for an organization that espouses sound customer-service processes and provides employees with a safe, challenging, rewarding environment. Fortune Magazine lists those companies.

After the list is published each year, the featured companies are flooded with unsolicited applications. In fact, in the current edition of the list there’s a section entitled, “How To Get Hired By A ‘Best’ Company.” As the author points out, “Looking at the past decade, our top 25 each year have averaged job growth of 14 percent.” The author goes on to mention that it helps to know someone at the company, because thousands of people submit applications. Before it opened in 2006, the Doha Hotel in Qatar received 25,000 applications for 600 positions.

Before we get into the specifics of these companies, let’s first examine how they were chosen. There’s that special moment in the Oscar awards program where two or three sartorially correct accountants come out on the stage with a briefcase containing the envelopes naming the winners for the evening. Of course we learn how the balloting was done. So in imitation of the Oscars, here’s how “The 100 Best” were selected:

“More than 105,000 employees from 446 companies responded to a 57-question survey. Two thirds of a company’s score is based on the survey, which is sent to a minimum of 400 randomly selected employees from each company and asks about things such as attitudes toward management, job satisfaction and camaraderie. The remaining third of the score comes from an evaluation of each company’s responses to a culture audit which includes detailed questions about demographic makeup, pay and benefits programs, and open-ended questions about the company’s people-management philosophy, internal communications, opportunities, compensation practices, diversity programs, etc. About 1,500 companies participated in the survey. Any company that is at least seven years old with more than 1,000 U.S. employees is eligible.” (Courtesy of FORTUNE magazine)

I have used this listing in my presentations to illustrate the attributes of these organizations. In that regard, I first shared the following 12-point list with QualityInsider readers in “The Corporate Running of the Bulls.” Interspersed with that list are examples from the “100 Best” list:

What makes the “100 Best Companies To Work For” so great:

They make people feel that they’re part of a team or, in some cases, a family.

• With an average salary of $90,083, the 1,376 employees of American Fidelity Assurance call this Oklahoma insurer their “second family.”
• National Instruments yearly stages an employee-appreciation week with executives serving breakfast and culminating in a family outing day.
• Nugget Markets throws a year-end bash, and in 2007 took all of its 1,322 employees whitewater rafting.
• In 2007, as is the case every year, the Plante & Moran team gathers at its annual conference, an opportunity to bond. Partner Jeff Jenkins stated that the theme was to “amp it up,” which means that in workplace and with client relationships and in family-oriented activities, the staff was asked to ratchet it up another notch while living the “golden rule” (i.e., treat others as you would like to be treated) More energy results in better client service, a more enriching work environment and better results.

They encourage open communication, informing their people of new developments and encouraging them to offer suggestions and complaints.

• The CEO at Adobe Systems answers employee e-mails within 24 hours and employee councils feed management with ideas.
• After feedback from employees, SRA International switched insurers, added health savings accounts and adoption aid, and increased 401(k) matches.
• Four times a year employees at Nike are invited to an all-employee meeting where feedback and suggestions are encouraged.
• The head of Yahoo hosts monthly chat ’n’ chow lunches with employees and even answers employee questions online.
• Perhaps the lowest turnover rate in the hotel industry (18 percent) is attributed to J. W. Marriott Jr.’s visits to 250 Marriot properties each year and meeting with employees.
• Cisco Systems uses an employee feedback/suggestion system, “On My Mind.”

They promote from within, letting their own people bid for jobs before hiring outsiders.

• Eighty-five percent of managers at supermarket Stew Leonard’s were hired in house. This supermarket has been featured in many of quality guru Tom Peters’ columns. Here’s a bonus: CEO Stew Leonard Jr. has a surefire way to determine the strength of the economy: “I look for the mashed-potato effect. If customers are buying our freshly-prepared mashed potatoes instead of whole potatoes, then the economy is doing well. Lately, bulk potato sales have been going up, so there’s a concern about where the economy is going.” The so-called experts can cackle about their charts and their prognostications, but for me, I’m focusing any investments I might make on the “mashed-potato” metric.
• At S.C. Johnson & Son more than half of employees are over age 45, 28 percent have worked there more than 20 years, and 78 percent more than six years.
• Twenty-three percent of Herman Miller’s workforce are “Water carriers,” employees who have 20 or more years with the company.

They stress quality, enabling people to feel pride in the products or services they provide.

• Quick action by Mattel in recalling defective toys from China illustrated this company’s focus on quality and safe products.
• Granite Construction has a zero-accident goal and employees are rewarded, not fired, for bringing attention to unsafe situations.

They allow their employees to share in the profits through profit sharing, stock ownership, or both.

• Ten percent of employees’ pay is deposited into 401(k)s at Booz Allen Hamilton.
• Workers at Stanley own at least 50 percent of the company.
• How about a 43-percent stock price rise at EOG Resources, where all employees have stock options.
• Intuit offers all new employees stock options.
• Of the 3,558 employees of PCL Construction Enterprise, 2,200 employees own shares in the company, and many received dividend checks last year in excess of their annual salaries.

They reduce the distinctions of rank between top management and those in entry-level positions, and they bar executive dining rooms and exclusive perks for high-level people.

• Everyone gets overtime pay at David Evans & Associates.
• No one earns more than 10 times anyone else at TDIndustries.

They devote attention and resources to creating as pleasant a workplace as possible.

• Because during tax season the workplace is home six days a week for employees of Plante & Moran, management has designed a building with staff in mind: Custom wood stain throughout the entire building, work stations designed by focus groups, each staff member has his or her own space with a nameplate, and in the front lobby a huge assortment of flowers is replaced weekly. Dan Essad, human resources senior manager stated it best when he was interviewed recently by reporter Carol Marshall for the Oakland Business Review: “We care for our clients, we care for our employees, our community, our families, and that caring is reflected in our space.”

They encourage their employees to be active in community service by providing money to organizations in which employees participate.

• Every employee at Intuit receives four days off with pay each year to perform community service.
• Umpqua Bank provides 40 hours of paid time yearly for employees to volunteer in the community.

They help employees to save with matching funds.

• Aflac boasts a 401(k) matching fund.
• Seven and a half percent of salary is offered as profit sharing at Arnold & Porter.
• Genentech bumped up 410(k) match in 2007—100 percent up to 5 percent of pay.
• Here’s quite a bonus from Boston Consulting Group—15 percent of pay deposited in a retirement plan.
• Alcon Laboratories has the richest retirement program in U.S. business with employee contributions matched 2.2 to 1.
• A 15 percent of pay contribution by Russell Investments is part of their automatic profit sharing.

They try not to lay off people without first making an effort to place them in other jobs, either with the company or elsewhere.

• American Express had 6,000 internal job moves last year.
• There’s a no-layoff philosophy at FedEx.

They care about the health of their employees, sometimes providing physical fitness centers and regular exercise and medical programs. (This was a perk provided by too many companies to mention. This is a sampling.)

• Healthways has walking trails, bikes for rent, and easy-to-locate stairways to encourage exercise.
• Certainly this was to be expected—Nike has a decathletes dinner every year.
• Tennis and basketball courts are provided by AstraZenica.
• eBay has hired a full-time staff of personal trainers and nutritionists.
• A pool, cardio room, a racquetball court, putting greens, and horseshoe pits can be found at SAS Institute.
• At Goldman Sachs, where the average salary of $137,000 keeps people financially healthy, you will also find rock climbing, a martial arts boot camp, massage therapy and Pilates. Even with the over-the-top salaries paid here, the company will even outfit you with workout duds.

They expand the skills of their people through training programs and reimbursement of tuition for outside courses.

• Tuition reimbursement of up to $20,000 and bonuses for advanced degrees, which 65 percent of MITRE employees have, makes this a company that encourages learning.
• Let’s not undercut what Station Casinos is doing—free dealers school for staffers wanting to advance and gain new skills.
• Johnson Financial Group offers a graduate tuition reimbursement up to $10,000.

No. 1 is Google, which prides itself on having fun and minting millionaires. The stock just rose above $700 and 99 percent of employees have stock options.

There you have it. So update your resumes and start campaigning for that new job, unless you are fortunate enough to work at one of these extraordinary companies. I’m just pleased that all of you are still working and supporting my social security and Medicare.

P.S. Finally, for those of you who are anal-retentive like me, I did mention in last month’s column that I would report on two recent books, The Three Signs of a Miserable Job (Patrick M. Lencioni, Jossey-Bass, 2007) and one about General Electric—Jacked Up (Bill Lane, McGraw-Hill, 2007). I suspect that some of you have been searching for that. Rest assured that will be in next month’s column. I thought learning about the best companies better served me and you than harping on a miserable job. I hope you agree.

About the author
William J. Kalmar has extensive business experience, including service with a Fortune 500 bank and the Michigan Quality Council, of which he served as director. He has been a member of the Malcolm Baldrige National Quality Board of Overseers and a Baldrige examiner. He’s also been named quality professional of the year by the Detroit Chapter of ASQP. Now semiretired, he’s a freelance writer for the Detroit News; writes a monthly column for Mature Advisor newspaper; is a mystery shopper for several companies; is a frequent presenter and lecturer; does radio voice-overs; and competes in duathlons.

Editor's Note: This article appeared in the March issue of Quality Digest Magazine which can be accessed at: www.qualitydigest.com

Tips for Fighting Identity Theft

2008-02-18T21:03:00.000-08:00

Courtesy of North Island Credit Union's Island Business Connection Newsletter, Winter 2008 issue

Nearly 10 million people were victims of identity theft last year and the incident rate is doubling every two to three years. North Island Credit Union encourages its members and other consumers to take steps now to reduce exposure to these crimes that cost the average victim 175 hours of personal time and $1,500 to correct.

One of our sponsoring member credit unions, North Island Credit Union of San Diego, California, recommends that you take several steps to protect your identity. First, make it difficult for criminals to obtain your social security number (SSN), your birth certificate, and all financial information. Treat these items like you would valuable jewelry. If you don't use them, don't carry them around with you. Keep them under lock and key. If someone requests this information in person, by phone, mail, email, or on a web site, you need to determine if it is a legitimate request. It's always better to politely refuse and stand fast in your resistance to share this information. [Note: the American Consumer Council and the California Consumer Council never ask for a member's SSN or checking account information].

If the medical insurance card in your wallet shows your SSN or that of another family member, ask your insurer to provide you with a card that does not contain your SSN. Alternatively, carry a photograph of the insurance card with only the last four digits of your SSN.

Given the number of financial statements, loan documents, and credit offers that arrive in the mail every week, we recommend that you rent a Post Office box, or have a locking mailbox at your home or business for confidential incoming mail. We also encourage our members to be careful with outgoing mail. Take it into the post office. Don't leave outgoing mail with payments and other financial information in an unsecured place. It's better to be safe than sorry.

In terms of paying your bills online, this actually has become one of the safest ways to conduct financial transactions provided the online merchant has encrypted software that prevents hackers from stealing your information in transit. Most of the established online payment systems are able to protect against identity theft thanks to sophisticated firewalls which they built into their software systems.

On that note, always be suspicious of an unsolicited email that asks you to provide any financial information. There are lots of scams out there and it's always better to "junk" these emails or telephone your financial institution (always use the number of the back of your credit card -- never use the the telephone number in the email) first before you ever give out confidential financial information or your SSN. Remember, most reputable financial institutions do not email you asking you to share your confidential financial information.

Also, it's safer to use a credit card than a debit card when buying items online. Also, we recommend that you use one credit card for all of your online transactions since it's easier to track any fraudulent activity this way.

Under federal law, you are entitled to receive a free credit report every 12 months from all three of the major credit bureaus. This includes toll free calls to: Experian, 888-397-3742 -- www.experian.com; Equifax, 800-437-4619 -- www.Equifax.com; and, TransUnion, 800-916-8800 - www.transunion.com Or, you can visit: www.annualcreditreport.com for more information on how to obtain a free credit report.

If you find any questionable charges on your credit report, immediately contact the financial institution or credit card company that processed the transaction to review the charge. Again, use the telephone number on the back of your credit card or credit union statement to contact the appropriate financial institution.

You also can file a complaint with the Federal Trade Commission at toll free: 877-438-4338; www.consumer.gov/idtheft; and, with local law enforcement or the US Postal Inspector. We encourage you to do this since fewer than 60% of identity theft victims do not notify law enforcement of the crime against them.

Finally, we strongly recommend that you shred all outdated financial documents before throwing them in the trash. This includes tax documents, credit card statements, credit union statements, old checks, and expired credit cards.

Remember, the key to protecting your identity is to make it very difficult for thieves to steal it!
For more information, please visit North Island Credit Union's Center at www.myisland.com

Some Unfinished Customer Service Business

2008-02-13T18:58:00.000-08:00

by Bill Kalmar

When finalizing my plans for a new year, it’s always gratifying to realize that all previous plans have been completed. As I recently went through this annual process, I noticed several issues affecting customer service and quality that I’d inadvertently left on the back burner. Consider this an early spring cleaning. With 10 inches of snow on the ground here in Michigan, it also prompts me to dream of warm weather and green, luscious golf courses.

Maybe it’s symptomatic of my being a senior citizen, but little things are beginning to aggravate me. As a starter, traipsing through the whole Medicare registration process is a calamitous journey that isn’t for the faint of heart. One needs a cadre of physicians, pharmacists, and legal beagles to assist in the navigation. It’s similar to a take-home exam, except most of the answers are not in the book. One can only hope that when the complicated package is completed, the road taken is a clear path to reduced health care costs and not some side road to confusion and refusal to provide reimbursement. Evidently meeting and exceeding the expectations of customers has yet to reach the Medicare process.

To make matters worse, it’s virtually impossible to contact any of the health care industry so-called “customer service centers” by phone to guide you through this process. Let me explain.

Several weeks ago, my wife, Mary, and I were at a local shopping center when I decided to contact one of these customer service centers. I called an 800-number and spoke to a delightful young lady who gave me the address of a center that was in the vicinity of the mall. Asking for the phone number presented the first impasse—I was told that the center doesn’t accept phone calls. Fair enough. Just give me directions from the mall to the service center because I had no idea how to get there. The delightful young lady had no idea on directions so I again asked for the phone number. This presented the second impasse.

I was politely informed that she wasn’t authorized to release the phone number and neither was anyone else in the office. I then asked for a supervisor and was told that a supervisor would call me shortly on my cell phone.

Mary and I then left the mall and went to a local restaurant for lunch. There we received a phone call from a health care supervisor who reminded me that not even supervisors were allowed to release phone numbers of these customer service centers. Being the politically incorrect person I am, I suggested that the governor’s office has a listed phone number, the White House handles calls, and I even have a 13-digit phone number for the Vatican. “Are the people in the customer service center more important than the Pope?” I asked and was given a polite “No,” but still no phone number. “Don’t the people who work in the office receive phone calls from spouses, children, and relatives?” Again the polite answer was, “I can’t answer that.”

Here’s where it gets zany. The supervisor asked me for the address of the restaurant where we were dining. When I inquired about the reason, she stated that she would provide me with Map Quest directions. After getting the address from a curious hostess who wondered why I needed the address of a location where I was already ensconced, I provided it to the supervisor. Sure enough, five minutes later I received a call back. Her opening words were: “First of all take a right hand turn out of the driveway. And there are eleven other instructions I will give you”.

Wouldn’t you think that just giving me the phone number would have avoided all this? My caustic comment stating “Is this what you do as a supervisor—preparing Map Quests for customers” didn’t sit well with her, but frankly I couldn’t blame her based on my condescending air.

I suggested that maybe a phone number could be provided for all these customer service centers in the state with a recording that states: “We do not accept phone calls but here are our hours and we are located between American Way and Customer Drive just north of Quality Street.” She took it under advisement.

When we finally located the office, the people were personable and professional. Guess what? All of them had phones. Go figure!

While I still have a burr in my saddle blanket, let’s discuss the issue of magazine subscription renewals. For years I have religiously renewed my periodicals after receiving a notice in the mail. I just assumed that it was time to renew. Some of the offers were too enticing to pass up, such as “pay for one year and receive the second year free” or “pay for one year and send a complimentary subscription to a friend.” I guess during these renewal times I neglected to thoroughly examine the mailing label to determine the expiration date.

Just recently I performed this tedious task on several publications I subscribe to and what a shock. One subscription doesn’t expire until the year 2012. It might just outlive me! Maybe I should make it part of my will so that I can pass it on to my children. Whatever the case, you can be sure I will be meticulous in reviewing expiration dates in the future before succumbing to another renewal notice. I realize that this is just part of good customer service but receiving a monthly copy of American Girl long after our children have flown the coop is a bit over the top for me.

Then there are restaurants putting cutesy monikers on restroom doors just to confuse us senior citizens. This seems to happen more frequently in themed restaurants. For instance a recent visit to the restroom in a seafood restaurant became an adventure. One door was marked “grouper” while the other was labeled “tilapia.” I opted for the “grouper” and fortunately made the correct choice.

I have been in restaurants in northern Michigan hunting country labeled “buck” and “doe” or “mallard” and “drake” and that doesn’t distress me. Or a country-dance emporium with “gents” and “gals” is fine. But when I’m under some pressure to enter the confines of commode headquarters is it necessary for me to understand the sexes of other species? I sure hope not.

Several months ago, I was at a restaurant that had clearly labeled the restroom doors as “men” and “ladies.” Just to confuse me, the other side of the door facing into the restroom was labeled “ladies.” Maybe some type of magical transformation was to have taken place inside, and for a moment I was discombobulated and looked around to make sure I was in the presence of other males. In any event, as a senior citizen it may be time to circumvent all these mind boggling choices and just bring a supply of Depends. When I’m searching for a restroom I really think that expecting me to take a quiz is unreasonable. The next time I’m in that situation, maybe the health care supervisor I mentioned previously could provide me with Map Quest directions.

I saw something interesting the other day about my favorite airline—Southwest Airlines. It seems the airline took a third-quarter pretax charge of $25 million for an early-retirement program. Here’s what caught my attention: Of the 8,500 employees eligible for retirement, only 606 accepted the offer. Having followed the culture and accomplishments of this airline for many years, I’d like to think that the majority of employees are extremely satisfied with their jobs and decided to stay on. The other option is that the offer was stingy, but until proven otherwise I can’t fathom that. In my estimation it’s still the best managed, most customer-friendly airline in the skies.

That pretty much clears off my back burner. I’m currently reading two new books: The Three Signs of a Miserable Job (Jossey-Bass, 2007), by Patrick Lencioni, and Jacked Up (McGraw-Hill, 2008), by Bill Lane, who was Jack Welch’s speech writer at General Electric for 20 years. The latter book has some interesting comments about why Welch ushered out Gary Wendt, the former head of GE Capital. Suffice it to say that “flatulence at meetings” isn’t an attribute that was high on Welch’s wish list.

Blog Note: This article appears courtesy of the Author. It also appears in Quality Digest.
Copyright © 2006 QCI International. All rights reserved.
Quality Digest can be reached by phone at (530) 893-4095.

About the Author:
William J. Kalmar has extensive business experience, including service with a Fortune 500 bank and the Michigan Quality Council, of which he served as director. He has been a member of the Malcolm Baldrige National Quality Board of Overseers and a Baldrige examiner. He’s also been named quality professional of the year by the Detroit Chapter of ASQP. Now semi retired, he’s a freelance writer for the Detroit News; writes a monthly column for Mature Advisor newspaper; is a mystery shopper for several companies; is a frequent presenter and lecturer; does radio voice-overs; and competes in duathlons.

Tom Hinton of ACC Assesses Most Profitable Companies

2008-01-22T11:20:00.000-08:00

by Tom Hinton

In reviewing the results of the Fortune 500 rankings and profit numbers from the second half of 2006, it might surprise you that many of the most profitable companies are not household names. In fact, none of the top ten companies that posted the biggest percentage increases in profits from 2005 to 2006 are US companies. What’s even more surprising, three of the five companies that had the highest percentage gain in profits during the second half of 2006, are in the food services business.

While the ten most profitable companies in 2006 remain household names (ExxonMobil, Royal Dutch Shell, BP, Citigroup, Bank of America, General Electric, Gazprom, Pfizer, and Chevron), those rankings are certain to shift with the downturn in the US economy. Future financial fortunes are shifting from the US to more prosperous markets in Asia, China, India, and South America.

As the United States struggles through a recession in 2008 -- and Japan, Germany, France, China, and Britain try to avoid getting whipped by the American economic backlash -- investors are looking to top-performing foreign companies that are well-positioned to withstand America’s recessionary fallout.

Here are five companies worth examining based on their profitability, superior customer service, strong global positions, and capable leadership.

At the top of the leader board for most profitable companies in 2006 is Compass Group, a British-based company that is considered the market leader in providing food and a range of selected support services to customers in the workplace. Compass Group ranked Number One in “biggest increase in profits during the second half of 2006 with a whopping percentage increase of over 27,000%. That’s right! Mergers and acquisitions certainly helped Compass Group’s bottom line in 2006.

Edeka Zentrale, which ranked Number Two for the biggest increase in profits for the second half of 2006, is Germany's leading food retailer and wholesaler with more than 13,800 outlets which operate as largely independent retailers supplied by its own regional food wholesalers. Edeka Zentrale enjoyed a 3,000% increase in profits from 2005 to 2006.

Alcan was the third most profitable company during the second half of 2006. Alcan has evolved into one of the globe’s leading suppliers of bauxite, alumina and aluminum, and a top-ranked provider of engineered and packaging materials, delivering increased productivity, competitiveness and profitability to customers around the world.
Alcan has some 68,000 employees, including its joint ventures, in 61 countries and regions. It’s based in Montreal, Canada with 2006 revenues of $23.6 billion and a handsome profit gain of over 1,200% from 2005.

China Life Insurance Company captured the fourth spot with 2006 profit gains of 595% as compared to its 2005 performance. China Life provides annuity products and life insurance to individuals and groups in China. The company offers products and services, such as individual and group life insurance, accident, and health insurance. It distributes its products through its direct sales representatives; agents; intermediaries; and commercial banks, postal savings, and cooperative saving institutions. The company was founded in 1949 and is headquartered in Beijing, China.

In the number five spot is Royal Ahold based in Amsterdam, Netherlands. Ahold is an international group of quality supermarkets with operations in the United States and Europe. Among its US brands are Stop & Shop, Giant Foods, and Peapod.com which provides internet-based shopping and grocery delivery for other brands. Ahold enjoyed a 582% increase in profits in 2006.

While the United States will spend most of this year in a recession as a result of its mismanaged war spending and sagging consumer confidence, there are several financial opportunities on the horizon as more foreign companies emerge as profit leaders in 2008.

About the Author: Tom Hinton is president of the American Consumer Council. Tom is a popular speaker at business conferences and corporate events. He can be reached at tom@americanconsumercouncil.org

Consumer Health Care Interests Are Not Being Served by Health Insurers

2008-01-16T15:57:00.001-08:00

by Thomas Hinton

Every week, it seems like there's another sad story in the newspaper, or on the television evening news, about the plight of someone who has been denied vital medical care. I'm talking about American citizens who have health insurance and pay their bills.

Let's review the case of Scott "Scotty" Eveland, a 17-year old senior at Mission Hills High School in Oceanside, California, who was severely injured and paralyzed while playing for his high school football team last fall. While Scotty is making a slow recovery, doctors who are treating him at a San Diego County hospital, are cautiously optimistic about his progress and recommended to Blue Cross of California that he remain at their facility to receive daily physical therapy.

But, Blue Cross of California decided Scotty's care was costing too much money and ordered him moved to another facility. Despite the protests of Scotty's doctors, family, and the Oceanside community, Blue Cross of California refused to change its ruling. The family appealed the health insurer's decision but lost. The have made a final appeal to California state regulators who can -- and should -- overrule Blue Cross of California.

Blue Cross of California noted in its decision that similar care was available at a lower cost, non-medical facility. The family and physicians tending to Scotty strongly disagree. Something tells me they know best since they are involved in his recovery and care every day.

Given this scenario and the gut-wrenching experiences people and patients must suffer through, I must ask the ultimate question: Why is it that health insurers like Blue Cross of California serve as both judge and jury in these matters?

Something is fundamentally wrong here with the health care system and how it is managed. For two years, the American Consumer Council -- along with other consumer-oriented organizations and government agencies -- have rallied against the health care management establishment to challenge the injustices and unfair practices of companies like CIGNA and Blue Cross of California who serve as both judge and jury. In essence, claimants pay their insurance premiums and then, if it suits the whims and financial goals of the health insurers, they decide whether or not people like Scotty recover or remain in a vegetative state. As harsh as it sounds, that's what medical directors and other so-called "health care professionals" are deciding every day. It's a sham!

Is it possible that medical directors, who once swore allegiance to uphold the best care of their patients when taking the Hippocratic Oath (an oath traditionally taken by physicians pertaining to the ethical practice of medicine), have been bought-off by health insurers and compromised in their ability to make unbiased decisions? I think so. How else does one explain their decisions to deny care? Certainly, these men and women are intelligent people. But, it appears they've lost their ability to act rationally and in the best interest of their patient-claimants in order to save their employers a few thousand dollars! Yes, it's really money, but, it's also about the dignity of human life!

When you read the Hippocratic Oath, which dates back to the Fourth Century, and is attributed to the father of medicine, it states unequivocally what is expected of a physician. This includes the medical directors of health insurers who also took this oath:

To teach medicine to the sons of my teacher.
To practice and prescribe to the best of my ability for the good of my patients, and to try to avoid harming them.
Never to do deliberate harm to anyone for anyone else's interest.
To avoid violating the morals of my community. (Many licensing agencies will revoke a physician's license for offending the morals of the community).
To avoid attempting to do things that other specialists can do better.
To keep the good of the patient as the highest priority.
To avoid sexual relationships or other inappropriate entanglements with patients and families.

Clearly, sections 2, 3, and 4 appear to be in question with the continuing care and treatment decisions of certain medical directors of health insurers. This raises some interesting legal questions that consumer groups are exploring. For example, if the "Community" were to sue a health insurer's medical director (or other licensed medical personnel), and a jury found that individual to be guilty of violating their Hippocratic Oath, could the guilty medical director be suspended from practice?

Perhaps it's time for community leaders and families of patients to raise the stakes and organize major boycotts and protests at these companies so that legislators will take action to fix a broken system.

While many health care proposals have been put forward -- including an impractical proposal by Governor Schwarzenegger of California to require all Californians to purchase health insurance -- the ultimate answer, we believe, is for the federal government to adopt a universal health system that provides primary and urgent care for all citizens. Such a plan was introduced by the American Consumer Council and can be viewed at: www.americanconsumercouncil.org

In the final analysis, there must be a national health care program that eliminates health insurers and removes life-and-death decisions from the hands of people who have been compromised in their ability to make unbiased decisions because their allegiance is not to the patient, but rather, a for-profit company that mostly cares about making a profit and not improving the health of the patient.

About the Author. Thomas Hinton is the president of the American Consumer Council and can be reached at tom@americanconsumercouncil.org

Training the Pig to Sing

2007-11-06T13:11:00.001-08:00

An old saying has guided me through the years—“Never try to teach a pig to sing. It wastes your time, and it annoys the pig.” A recent article in the Wall Street Journal in the Cubicle Corner section was written by a good friend of mine, Jared Sandberg. In “Bad At Complying? You Might Just Be a Very Bad Listener,” Jared describes a two-day course in the power of listening that he attended. These soft-skill courses—I call them behavioral interventions—have plagued my career for as long as I can remember, and I’ve been trained beyond my intelligence. One of the advantages of my retirement is being removed from those mind-bending courses.

In the above article, Jared describes a situation where the boss is trying to fix someone with training. “There’s fluorescent lighting, stain-resistant carpet, and motivational posters with puppies, elephants, or monkeys.” Is it coming back to you now? Are you having the same heart palpitations I had when I recalled a similar setting?

These behavior-altering courses cover leadership, team building, conflict resolution, how to deal with incorrigible employees, and charting your management style, to name just a few of the sessions designed to improve your thinking.

I don’t want to seem cynical, but, by and large, people’s behavior cannot be altered. And, just for the record, I’m an annoyed pig.

Victims of these courses quickly learn what’s unacceptable behavior and then camouflage their own behavior from then on. Deep-down, nothing has changed. It’s the old “getting along to get along.” Corporate survival dictates that we wholeheartedly absorb all these recommendations, but how many of us have sleep-walked ourselves through these sessions? Let’s see a show of hands. My hand is up.

I’m not talking about training that provides instruction on new products, a new computer system, diversity training, or a whole myriad of areas that one needs to keep pace with technology. I know people who are involved in such training, and I value their contribution to this line of work. Nonetheless, let me provide some examples of fluff training that I think should be relegated to the “cemetery of bad ideas.”

In a previous career I was a trainer and provided some of this fluff. Nothing seems to account for some of the foolishness I dispensed in the name of training.

One of the ridiculous techniques I taught in a course on quality improvement was to have the attendees take off their shoes and then place them on the opposite feet. I’d ask, “Now how do you feel?” They’d say, “It’s awkward,” “It hurts,” “Let’s go back to the old way.” Then I would counter with, “Change is always difficult, and we just want to return to what was more comfortable.” It’s a wonder someone didn’t throw a shoe at me.

A friend of mine who’s nearing retirement recently attended an internal course entitled “Left Brain, Right Brain.” Many people in his department upon seeing the curriculum tried to opt out, but the corporate all–knowing hierarchy indicated otherwise. My friend said that it was a complete waste of time and at the end of the day he didn’t know if he was left-brained logical and objective or right-brained random and intuitive. He just knew that he was brain dead.

How about the team-building exercise where people are asked to fall backwards into the hands of their cohorts to illustrate trust? Here’s one I saw at a major automaker: People were passed through a labyrinth of rope squares by their associates. This was also done to engender trust but other than a couple of rope burns and some unintentional groping it seemed like another candidate for the cemetery of convoluted ideas.

Many years ago, a financial institution I worked for introduced “Grid Training” for management. For a torturous week we were barricaded in a hotel where we had to determine if we were 9-1s, 9-9s, 1-9s or some other number that would indicate our management style. The sessions were brutal and lasted until well after midnight; many people left in disgust. Senior management never indicated how this would improve the company, and it never did. We were all supposed to emerge equally focused on work and the feelings of others. The senior management team comprised the usual number of ogres, and improvement never happened.

In researching this article, I solicited examples of training sessions that left people discombobulated or flummoxed, but not wiser. One corporate elixir that came back repeatedly was training for 360-degree reviews. Most felt that feedback from superiors, peers, and underlings had turned into “I’ll scratch your back if you scratch mine.” As one respondent commented, “If people had been honest with their reviews, it would have been the end of several amicable working relationships”.

Before you conclude that I’ve fallen out of my hammock and hit my head, I’ll admit there are several training sessions that still resonate positively with me, some of a behavioral nature. The three days of training in the Baldrige process is a valuable session that explores in detail the inner workings of companies, starting with leadership and working your way through workforce resources, strategic planning, and concluding with organizational performance results. If you’re accepted as a Baldrige examiner, it’s free.

A course proven to be valuable in interacting with people, particularly for conflict resolution, is “DISC Training,” which provides guidance in the communication style and preferences of others and how to best “flex” to meet the communication needs of those important to you. It’s understanding people as they are and how to work effectively with them.

Through their Leadership Center The Ritz-Carlton offers a variety of courses that provide insights into its culture and philosophy of hiring people with positive attitudes who don’t require any fixing. The center is a resource for organizations interested in benchmarking many of the business practices that led to The Ritz-Carlton becoming a two-time recipient of the Malcolm Baldrige National Quality Award. These are courses that are appropriate for any company interested in raising their customer service to a higher level. The courses also review the elements of developing a strong management team.

Another stellar training organization is the Disney Institute. Removing barriers that inhibit performance excellence is an integral part of the module.

A behavioral training course that still influences me is “The Executive Technique.” This is a two-day course on developing communication skills, such as organizing and delivering a real-life communication from your listener’s perspective, creating visual aids, how to maintain control of difficult question-and-objection situations, and even a session on proper business dress and etiquette.

And I would be remiss if I didn't mention a resource in my backyard, namely Eastern Michigan University which offers a potpourri of multiple-day courses in quality and continuous improvement in their Center for Quality.

Anther friend of mine, Tom Hinton, who is with CRI Global (out of California) summed up the behavioral-training mystery this way:

“Years ago, when we trained clients in the areas of leadership, customer service, and business excellence, they would thank us, pay us, and then go back to business as usual. Today, our clients are engaged in the training process. Today, clients want to know what results they can reasonably expect from their training investment. Leaders also want to know what they need to do on Monday morning to keep the training lessons fresh in the minds of the employees. I think the reason for the change among leaders is two-fold. First, leaders are now more accountable than every before for organizational success. Second, I think most leaders generally want to move their organizations from good to great by creating a culture of excellence.”

Well said!

Tom Peters once said, “You should not train anyone in a topic that he or she cannot implement within the workplace within 72 hours.”

Finally, this comment from a former colleague: “Most management behavioral-training classes are worthless in that they are either inane or the brass does nothing to reinforce the taught behavior.”

There are people like me, who have been trained beyond their intelligence, and there are others like the pigs, who are annoyed even when asked to be in a training session. Rather than spend money and time trying to make attitudinal changes, perhaps the answer is to jettison these recalcitrant, irascible employees from the company. A recent incident chronicled by USA Today brings this into focus and clearly illustrates my point:

“Owning up to its bad management, the City Council in Ashland, Oregon, has decided to throw itself on the civic version of a therapist’s couch. The six-member council, plagued by bickering, sniping, and profanity at its public meetings, agreed to spend $37,000 of taxpayer money for professional help to learn how to get along.”

I can imagine the chaos that will ensue when members are passed though a labyrinth of ropes or asked to fall backwards into the trusting arms of their colleagues. After reading about this organizational meltdown, I’ll take my chances training pigs.

In the meantime, I’ve made the transition into retirement not knowing or caring if I’m left-brain or right-brain, or if I’m a 9-1 or a 9-9. The best part? No more role-playing! Now, if I could just figure out a way to correct the aberration in my feet from wearing my shoes on the opposite foot during the training session...

About the Author:
William J. Kalmar has extensive business experience, including service with a Fortune 500 bank and the Michigan Quality Council, of which he served as director. He has been a member of the Malcolm Baldrige National Quality Board of Overseers and a Baldrige examiner. He’s also been named quality professional of the year by the Detroit Chapter of ASQP. Now semiretired, he’s a freelance writer for the Detroit News; writes a monthly column for Mature Advisor newspaper; is a mystery shopper for several companies; is a frequent presenter and lecturer; does radio voice-overs; and competes in duathlons. He can be reached at Billmarykalmar@aol.com

Consumer Council No Longer Supports Product Safety Commission Chairwoman

2007-11-02T19:22:00.000-07:00

The president of the American Consumer Council said today that the head of the US Consumer Product Safety Commission, Nancy Nord, should resign for breaching the trust of consumers. Thomas Hinton, president of ACC, a national consumer education organization, called on Nord to resign for "compromising the Commission's integrity" by accepting lavish travel from manufacturers and trade associations that the Commission regulates.

Hinton said, "the US Consumer Product Safety Commission has one job -- to protect consumers. Chairwoman Nord has betrayed the American consumer and compromised her office. She is no longer credible. She should resign immediately to help restore credibility at the CPSC."

Hinton also called on the CPSC's General Counsel to resign for allowing Commission staff to skirt government regulations that prohibit subsidized travel that creates the appearance of a conflict-of-interest. Hinton added, "By allowing members of the Commission and their staff to travel at the expense of those industries it is supposed to regulate, Nancy Nord and her general counsel have violated the spirit of the law. They should resign or be fired." Nord has ordered an ethics probe of the agency after she was accused of taking "gift travel" from industries regulated by the federal government's consumer product safety watchdog.

"Travel by all employees at the CPSC goes through the agency's painstaking review by the Office of the General Counsel. That process has been in place for 14 years," Nord said in a statement. "Nevertheless, because questions have been raised about the adequacy of these long standing procedures, I am asking the Office of Government Ethics to conduct a complete review of the agency's travel acceptance procedures," Nord's statement added.

Hinton dismissed Nord's explanation saying, "Government officials as Ms. Nord's level should know the difference between right and wrong. Given her lack of judgment, she should resign. We no longer trust her to keep American consumers safe."

A report in the Washington Post accused Nord and her predecessor Hal Stratton of taking 30 trips since 2002, including to China, paid in full or in part by industries whose products are monitored by the CPSC or lobbyists.

"The records show that Nord and Stratton repeatedly accepted gift travel for events from industries subject to CPSC enforcement," the report said.

"The records also detail several trips that were paid for by lawyers who represent manufacturers in product liability lawsuits," it said.

Two of the trips taken by Nord, who like Stratton was appointed by President George W. Bush, were paid for by the Toy Industry Association, whose members are "battling public mistrust over lead in toys made by their Chinese manufacturers," the report said.

The report was published amid a raft of recalls of toys imported from China, which have prompted calls for Nord to resign and the CPSC to be overhauled.

A pending congressional bill that would double CPSC funding, broaden its authority, modernize its facilities, and increase numbers of CPSC workers and safety inspectors at US ports was sent to the Senate last month -- despite Nord's opposition.

"It's clear that Chairwoman Nord is in the lap of the special interest and not the American consumer," Hinton noted. "You cannot have an effective, balanced government agency when its leadership has been compromised."

Why "The Best" is The Best

2007-10-09T19:05:00.000-07:00

By Bill Kalmar

Whenever I enter a Ritz-Carlton hotel, I know “I’m not in Mediocreville anymore!” Walking through those doors transports me to a world unparalleled in service, with guest amenities and services consistently beyond my expectations. Unlike the Wizard of Oz, the hotel is everything it purports to be.

I’m not a shill for The Ritz-Carlton, but, like other quality professionals, I’m a fan of extraordinary customer service and of organizations that exude professionalism and exceed customers’ expectations, and The Ritz-Carlton is one of those organizations. In the July issue of Consumer Reports, the magazine’s subscribers agree that, “The Ritz-Carlton earns top marks in value, service, upkeep, and making problems go away.”

This two-time Malcolm Baldrige National Quality Award winner (1992 and 1999) has set the standard in the hotel industry for unparalleled service. In addition, Training magazine recently ranked it No. 1 for employee-sponsored workforce training and development. Based on those accomplishments, I wanted to discover what was behind the curtain, so to speak. How does this company of 40,000 employees maintain its mystique and what lessons can other companies learn from it?

First, I interviewed vice president for quality and program management John Timmerman, who is responsible for the hotel’s quality worldwide. I also interviewed area human resources director Laura Gutierrez, who is responsible for human resources in Dearborn, Michigan, St. Louis, Cleveland, and Philadelphia. Both are long-term employees, which is consistent with the company’s low turnover rate. I came away from both interviews in awe of their strategic-planning methodology and the manner in which the hotel and its ladies and gentlemen, as they are called, constantly look for ways to strengthen service.

By the way, no Baldrige applicant has achieved a perfect score of 1,000, and the final assessments always allow for many opportunities for improvement. In that regard, The Ritz-Carlton continually seeks best practices from other organizations and from their own properties that can be incorporated worldwide, and it listens closely to the needs, wants, expectations, and suggestions of guests.

As I reviewed my interview notes with Timmerman and Gutierrez, I decided to present nuggets of information that reflect the processes ingrained in the hotel and thus have those nuggets stand alone as benchmarks for other organizations. So sit back and enter a world of customer excellence with me.

Guests return to The Ritz-Carlton because they are emotionally engaged with the hotel, as validated by The Gallup Organization, which reports Ritz-Carlton performance at greater than the 90th percentile of their global database of consumers. That means that The Ritz-Carlton’s guests return even if a competitor offers a lower price. That’s loyalty.

Part of the hotel’s mystique comes from fulfilling even the unexpressed wishes and needs of the guests. This is accomplished by having the empathy to know what thrills guests and how the staff can make the visit memorable. This is accomplished in conversations with guests and by maintaining a knowledge-management system that records the preferences of every guest. Maybe it’s a favorite magazine or wine, or dessert or cappuccino. Whatever the case, the staff goes out of their way to dazzle the guests, thus strengthening those relationships.

Customer feedback is obviously an important part of the improvement process. Simon Cooper, president and chief operating officer, states, “When it comes to customers, feelings are facts.” The Ritz-Carlton deploys multiple methods to capture the customer experience, such as comment cards and a follow-up survey call from the Gallup organization to guests after their stay. In addition, the staff discreetly look, listen, and ask for feedback during transactions and moments of truth to build upon the Ritz-Carlton knowledge-management system. In addition, there’s a follow-up survey conducted by The Gallup Organization, which provides third-party validation. Finally, mystery shoppers circulate though the various properties to critique the processes.

The feedback report on the company’s first Baldrige application, in 1991, indicated significant opportunities for improvement, which acted as a catalyst for The Ritz-Carlton to benchmark dissimilar industries and thus create “cycles of improvement”—the line-up, the open-door policy, the annual employee survey, management by walking around and asking questions of staff and guests, the feedback from Baldrige, and all the other elements that make up the strategy for improvement. It worked, and in 1992 The Ritz-Carlton became the first service organization to win the Baldrige Award. In 1999, when The Ritz-Carlton won its second Baldrige award, examiners visited more than 30 domestic properties and then talked to all of the international properties by telephone. That’s a thorough site visit!

Every employee of The Ritz-Carlton has a wallet card with the mission and values of the organization. Most of the 12 service values are applicable to any organization:

Service values—I am proud to be Ritz-Carlton

1. I build strong relationships and create Ritz-Carlton guests for life.

2. I am always responsive to the expressed and unexpressed wishes and needs of our guests.

3. I am empowered to create unique, memorable, and personal experiences for our guests.

4. I understand my role in achieving the key success factors and creating The Ritz-Carlton Mystique.

5. I continuously seek opportunities to innovate and improve The Ritz-Carlton experience.

6. I own and immediately resolve guest problems.

7. I create a work environment of teamwork and lateral service so that the needs of our guests and each other are met.

8. I have the opportunity to continuously learn and grow.

9. I am involved in the planning of the work that affects me.

10. I am proud of my professional appearance, language, and behavior.

11. I protect the privacy and security of our guests, my fellow employees, and the company’s confidential information and assets.

12. I am responsible for uncompromising levels of cleanliness, and creating a safe and accident-free environment.

These are outcomes that any company can infuse into its own internal processes. Who wouldn’t want to participate in plans to restructure their own work? Who wouldn’t want to feel empowered to fulfill the needs of customers? In this case, The Ritz-Carlton allows each employee to make corrections costing up to $2,000 each day. And guess what? The Ritz-Carlton tracks and publicizes employee acts of customer-service heroism and measures customer engagement, not the actual amounts spent. Finally isn’t it refreshing to know that there’s no buck passing? Whoever receives or hears about a problem, owns it and follows up to ensure its resolution.

Employees are surveyed yearly by The Gallup Organization, and the results are shared with all the ladies and gentlemen of The Ritz-Carlton. Open lines of communication are an integral part of the strategic plan, and one of the ingredients is the daily lineup. At every property worldwide and at every shift change a meeting of the staff is held. During this meeting a leader will focus on one of The Ritz-Carlton Service Values and discuss activities at the local property, such as guest arrivals or special events. In this fashion the staff is made to feel comfortable in discussing issues with the team, thus reinforcing the open-door policy. This is a strong element in the hotel’s success and one that I think other companies should adopt.

How does one recruit, hire, and train such extraordinary employees? The Ritz-Carlton uses the services of a company called Talent Plus, which has engineered a 60-minute interview process that can be conducted over the phone. This process extracts from potential employees information to make sure that they will fit into the hotel’s demanding culture. The questions address how the candidate might handle certain situations at work and asks for examples of work experiences. Many of The Ritz-Carlton human resource staff have been trained in this process, and thus many of the interviews take place at the local properties. Having participated first-hand in the Talent Plus process, I can attest to its thoroughness and effectiveness.

Previous experience in the tourist industry is helpful but not a prerequisite, according to Laura Gutierrez. It’s more important to have a positive attitude. Gutierrez says that talents are formed between the ages of five and eight, and it’s the function of the hiring manager to identify those talents and make sure that they’re in sync with the goals and culture of the hotel.

Successful organizations have a methodology for weeding out ineffectual practices and a way to correct defects. At The Ritz-Carlton that process is known as “MR. BIV”—an acronym for mistakes, rework, breakdowns, inefficiencies, and variation. The overall goal of MR. BIV is to foster an environment of open communication and continuous cycles of learning. It’s a systemic approach to problem solving that is used worldwide and that has stimulated numerous improvements in internal processes.

There has recently been some discussion in the papers about The Ritz-Carlton relaxing some of their standards to meet the expectations of a new breed of guest—one who might be more casual in appearance. According to John Timmerman, the standards remain the same but staff are empowered to treat guests “as they see themselves.” That means employees can break the rules of scripted procedures to satisfy a customer. For example, an employee can speed up the cycle time of the dining process if they feel the business customer prefers speed over formality, or slow down a process if the traveler wants a more informal and relaxed environment. Universally, service is at a very high level, and guests leave knowing that their every request has been honored.

Some guests make unusual requests because of the reputation of the hotel. “As long as it is not illegal or immoral, we will move heaven and Earth to fulfill requests,” John Timmerman says. That attitude has served the hotel well over the years, enabling it to rank consistently in the top tier of hotels worldwide. The Ritz-Carlton is currently ranked in first place by the Market Metrix Hospitality Index.

As a Baldrige examiner, I’m aware of numerous organizations that benchmark against the processes of The Ritz-Carlton, notably hospitals. It’s a simple equation—hospitals have rooms and processes to gain entrance to those rooms. Once a room isn’t occupied, how fast can the room be turned around for the next patient or guest? No one does this procedure better than The Ritz-Carlton, and hospitals are incorporating these procedures as their own.

Well, I think you can tell that I’m completely enamored with the processes at this award-winning hotel. I think that there are numerous processes that other organizations can copy that will allow those companies to distinguish themselves from their competition. There are many other techniques and processes that I could have touched on, but I think you have a flavor for this remarkable company. Meeting and exceeding customers’ expectations and fulfilling even their unexpressed wishes ought to be the clarion for all companies.

Several years ago, a reporter for a major newspaper attempted to test the customer service of the hotel and made unusual requests to gauge the response. One such request was to “Provide a room with seven pillows—four feathered and three foamed alternatively stacked, and a room facing south on a floor in the single digits.” The other requests were just as odd. He concluded, “I poked, I prodded, I tried to do everything in my power to drive those people crazy. Not once did they flinch, overact, or try to escort me out headfirst. They won.”

When a U.S. commander speaks to a group of soldiers, his words are often met with a hearty “Hoo-Ahh,” which means â€œHeard, Understood, and Acknowledged.â€� That’s what I wanted to say after my interviews with John and Laura, because everything they said resonated with me as a quality professional who has experienced the care and attention of the ladies and gentlemen of The Ritz-Carlton. This company should be benchmarked and held up as a role model. You can learn more by reviewing its 1999 application on the Baldrige Web site. There’s a storehouse of knowledge and information in those 24 pages, and it’s free.

Now I’m off to my local Ritz-Carlton to test their processes. I ordered a Roman chariot to transport me up the road from the hotel to Greenfield Village. I’ll let you know next month how it turned out. In the meantime, ”Hoo-Ahh!”

About the author
William J. Kalmar has extensive business experience, including service with a Fortune 500 company and the Michigan Quality Council, one of the top state quality award programs in the United States. He has been a member of the Malcolm Baldrige National Quality Award board of overseers and responsible for the management of a volunteer structure of more than 1,000 people in a statewide program patterned after the Baldrige program.

Ten Inexpensive Ways to Show Your Employees You Care

2007-10-09T18:58:00.000-07:00

It’s approaching that time of year when Wall Street starts calculating bonuses for its top performers to show their appreciation to employees for a strong quarterly performance. Many other companies will soon be digging into their coffers to shower employees with year-end rewards, gifts and bonuses. But, don’t kid yourself. These companies aren’t giving away greenbacks just to be nice. They do it to keep their best and brightest employees motivated, committed, and primed for another record-breaking quarter or year. Employers understand that bonuses and other forms of recognition build employee satisfaction and strengthen employee loyalty.

But, what about smaller companies that might not have millions of dollars to spend on performance bonuses or incentive trips for their top performers? What can you do to show your employees that you really care?

Here are my ten favorite ways any boss can show his or her appreciation to employees throughout the year without breaking the bank! How many of these fun ways are you currently using in your organization?

1. Write personal notes to thank employees for all they’ve done to make your business a success. Personal notes from the boss mean a lot to employees. Don’t underestimate their long-term value. At a retirement party for one long-term employee named Joe, he produced 32 hand-written notes from the CEO and told attendees “I’ve kept every one of your notes over the years. It’s the best present I ever got from the company!”

2. Host periodic in-office pot luck luncheons to celebrate team achievements.

3. Create a “Wall of Fame” where positive letters from customers are posted for all to see. And, be sure to personally acknowledge the work of those outstanding employees who generated the high praise from customers.

4. Provide three training days a year for every employee who meets their quarterly goal or performs above-and-beyond the call of duty. Send these high performers to a professional development program of their choice. Allowing the employee to choose his/her own training program makes it more meaningful for that employee.

5. Celebrate employees’ birthdays and special work-related anniversaries on their actual day. If the special day falls on a weekend, celebrate it on the Friday before. The point is not to wait until the end of the month to celebrate these special dates because the celebration will lose its emotional impact and goodwill if you’ve missed the actual date.

6. Host a “Praise ‘Em” event twice a year. It can be as simple as a bowling party or lunch at the pizza parlor where you shower each person with high praise. By the way, this doesn’t replace the annual holiday party. Find at least one meaningful thing to say about each employee present and mean it! Let them know you appreciate the good job they are doing. (Yes, I know that a few of your employees might be slackers, but certainly, if you’re paying attention to their performance, you can find at least one good thing to say about their work twice a year, right? If not, they don’t belong on your team!).

7. Involve employees in key decisions that directly affect them. People have a right to participate in their future. This is a good way to treat your people with dignity and respect. Let them know they are an important part of your business success by seeking their ideas and input before you make key decisions that affect their lives.

8. Don’t keep secrets. This is what fuels the negative water cooler gossip machine. Avoid secrets at all costs because they only create an atmosphere of deception and resentment. If you are not at liberty to discuss a particular corporate decision, just tell your employees you cannot talk about that issue at this time. Otherwise, be open and truthful. This tells your employees that you respect them.

9. Give your employees the gift of a listening heart. As the boss, you should be sympathetic to the personal problems of your employees. Every employee has “issues” whether it’s a troubled teen-ager, an abusive spouse, a sick parent, or too much work and not enough time off. If you are doing your job as the boss, you should know what’s troubling your employees and be understanding and helpful in their time of need, especially family emergencies and tragedies affecting the company or an employee.

10. Stand up for what is right. Don’t be the kind of boss who cowers under the pressure of the corporate hierarchy and sells his soul for a few bucks instead of doing the right thing for his people. In the final analysis, it is more important to preserve your integrity and self-respect than to do something stupid, immoral, illegal, or hurtful. People never forget the heroic actions of a true leader. Do battle for what is right and your employees will follow you anywhere… even out the door!

These are just ten ways to show your employees that you really care. They cost very little and, in the end, you will find that you have happier, healthier, and more dedicated people working for you and creating record results!

Tom Hinton is a popular business speaker and author. He can be reached via email at tom@tomhinton.com. His website is: www.tomhinton.com

CCC Endores National Healthcare Proposal To Benefit All Consumers

2007-10-09T18:44:00.000-07:00

The California Consumer Council has endorsed a proposal by the American Consumer Council to create a new, not-for-profit federal agency, the National Healthcare Foundation, to provide primary and urgent healthcare for all Americans.

Thomas Hinton, President of the American Consumer Council, said, “It is time for our elected officials and policy makers to adopt a national healthcare reform program in which every American can participate at little or no cost.”

According to Hinton, “the solution is the adoption of a progressive healthcare program for the United States which would be created by an Act of Congress, paid for by taxpayers, and managed by an independent, non-profit agency called the National Healthcare Foundation, under the direction of the Secretary of the Department of Health and Human Services.

Hinton said the healthcare proposals of presidential candidates have merit but do not go far enough in providing primary and urgent care for every American. In a prepared statement, Hinton said “while the United States arguably has the finest healthcare professionals and treatment facilities in the world, many Americans cannot get access to our outstanding healthcare system because of the prohibitive cost, insurance restrictions, political bickering, and arcane government regulations that work against health and wellness in our country. In the meanwhile, Americans are being denied urgent treatment for legitimate illnesses and dying.”

ACC’s proposal calls for a voluntary program that would transform America’s current healthcare system into a network of not-for-profit hospitals and clinics that would provide primary and urgent care needs for every American citizen. Hinton estimated that this innovative approach would attract more than 90 percent all of medical professionals, universities, clinics, non-profit service agencies, and industry organizations that currently serve the healthcare industry in America because fees-for-services would be paid for by the NHF provided certain licensing and regulations were met.

In announcing the proposal, Hinton said that “it is appalling that every American does not currently receive free primary healthcare services as an entitlement of their citizenship. It’s time we emerged from the dark ages of ‘healthcare for the privileged’ and adopted a progressive healthcare program that provides outstanding healthcare for all Americans.”

Hinton also addressed the question of who will pay the bill. “The honest answer is that any national healthcare program will be paid for by you and me -- the American taxpayers and corporations doing business in the United States. Despite the initial investment, we believe a national healthcare initiative is the most efficient and comprehensive way to advance healthcare for all and keep the costs from spiraling out of control. It will require a reallocation of national resources to pay for this program.”

ACC’s proposal includes two important reforms he says are vital to “changing the way America thinks about health and wellness issues and protects our medical practitioners” -- Malpractice insurance and the reclassification of certain illegal drugs.

Hinton’s proposal calls for a special Malpractice & Medical Claims Insurance Fund (MMCIF) to be established as part of the healthcare reform package by Congress which would pay for medically-related lawsuits or malpractice claims brought against NHF participants. Hinton noted that reasonable malpractice insurance premiums would be established by the MMCIF and paid for by NHF program participants.

Hinton said “this element of the NHF is the hook that will single-handedly encourage over 90 percent of all physicians, dentists, and other healthcare practitioners, who must now pay costly malpractice insurance premiums, to enroll in the NHF and support its success.” Hinton added, “Also, as a volunteer program, the benefits of participating in the NHF must be significant in order to attract widespread national participation among medical professionals and medical care facilities. This clause will have that positive effect.”

Hinton also explained how the program would allow for the re-classification of several illegal drugs including marijuana, cocaine, and heroin. Under the proposal, legislation would allow for the controlled distribution of limited quantities of these drugs through legal prescriptions under a system similar to the current medical prescription and pharmaceutical distribution of prescribed drugs by licensed physicians. According to Hinton, “These drugs would be prescribed by physicians and dispensed by licensed pharmacists to persons who require them for medicinal purposes or to treat their addiction. As part of Hinton’s proposal every patient using this prescribed classification of drugs would be required to participate in a licensed counseling and treatment program.

The role of the NHF would be to administer a national healthcare program through a network of state agencies that entitles every American citizen and authorized visitors (tourist, student, visa holder, etc) to unlimited primary and emergency healthcare services for any treatment that will enhance their wellness or preserve their life.

At the heart of ACC’s national healthcare proposal would be a network of medical facilities, hospitals, shelters, and clinics that would all be required to operate as independent, self-operated, not-for-profit entities. “This system is already in place now,” Hinton noted. Individual physicians and other medical professionals would be exempt from this requirement and eligible to participate in the NHF program provided their billings were directed through a not-for-profit entity such as a not-for-profit hospital, lab, or clinic.

The full text of Hinton’s remarks regarding ACC’s healthcare reform proposal follows:

A Healthcare Solution for America

A Statement by:

Thomas Hinton
President & CEO
American Consumer Council
San Diego, CA
tom@americanconsumercouncil.org

October 9, 2007

Good morning and thank you very much for attending this briefing. I think the large turnout today reflects the legitimate concerns American consumers have for the troubled state of healthcare in this country.

I am here today because American consumers are unhappy with the cost and accessibility of healthcare in our country. It is apparent from the emails, letters, and comments made by thousands of American consumers that the overwhelming majority of people in this country are both frustrated and angry with the current healthcare system. They are frustrated because of the escalating cost of medical insurance and fees-for-services; and, they are angry because politicians and policy makers have failed to act and reform healthcare.

Specifically, Americans want three things in terms of healthcare reform. First, they want unlimited access to primary and urgent healthcare. Secondly, they want that access at an affordable cost. And, thirdly, they want assurances that doctors, nurses, and other healthcare providers will be thoroughly-trained and educated in terms of medical technology, the treatment of diseases, and place the concerns of their patient above all other competing interests. Given these three priorities, let me share with you a potential solution that will fix our healthcare delivery system and ensure these three objectives are met.

We believe the long-term healthcare solution for America requires a shift is how we think about healthcare. In other words, Americans need to embrace the proposition that every citizen -- if fact, all human beings -- have the right to health and wellness given the tremendous medical advancements and capabilities we have made around the world.

While the United States arguably has the finest healthcare professionals and treatment facilities in the world, many Americans -- more than forty million by current estimates -- cannot access our healthcare system because of the prohibitive cost, insurance restrictions, and arcane government regulations that work against health and wellness in this country.

It’s time to move beyond the finger pointing, political bickering, and posturing among special interest groups that is stifling healthcare innovation and continuous improvement, and adopt a national healthcare reform program that every American can access at a reasonable cost. To date, I have heard only weak proposals from politicians and policy-makers to reform healthcare. But, frankly, these are “band-aid” solutions and will not be enough to save the patient, the American consumer. What is called for is radical surgery -- sweeping reform that is innovative and all-encompassing. For these reasons, bold leadership is now required at the highest levels of government and the healthcare industry.

We believe the solution is the adoption of a progressive healthcare reform program for the United States which would be enacted by Congress, paid for (mostly) by taxpayers like you and me, and managed by an independent, non-profit organization under the direction of the Secretary of the Department of Health and Human Services.

The heart of this progressive healthcare reform program is a lucrative, but voluntary, enrollment program for medical providers and healthcare facilities. In other words, medical providers have a choice. They can continue to do business-as-usual and treat those patients who elect to support them through direct payment or insurance, or they can enlist in a new national healthcare program known as the National Healthcare Foundation.

We think this innovative approach will attract, within three years, more than 90 percent all of medical professionals, universities, clinics, non-profit service agencies, and industry organizations that currently comprise the healthcare industry in America. I also think it will set a precedent for other nations that wish to provide a national healthcare program for their citizens.

But, who will pay for it, you might ask? The honest answer is that it will be paid for by you and me -- the American taxpayers as well as every corporation that does business in the United States. There are certain things that every American needs and should demand from their government. A quality education and comprehensive healthcare are two such needs that will raise our standard of living and create a stronger nation. I also believe a national healthcare initiative is the most efficient and comprehensive way to ensure healthcare for all and keep the costs from spiraling out of control.

My motive in supporting a national healthcare initiative is selfish. I want access to the best healthcare in the world for the rest of my life -- whether I live a thousand days or 10,000 days; and, I don’t want to be told by some faceless individual working in a corporate complex, whose job it is to save his/her insurance company money, that a vital medical procedure, treatment, or drug will not be authorized because their bottom line is valued more than my life. It’s that simple! Here’s a true story that illustrates my point.

A few weeks ago, I read a very disturbing front-page story in the Wall Street Journal about a middle-aged woman who worked in a small town in Texas as a hairdresser. As I recall the story, the woman discovered a lump in her breast and went to a private hospital for diagnosis and care. Unable to pay for the necessary treatment, she was shuffled from one doctor to another over several months until a medical facility finally agreed to examine and treat her for a fee.

Regrettably, over the course of her illness she did not receive timely care. Furthermore, federal regulations that would have allowed her free medical care were unknown to the patient and she was caught in a Catch-22 cycle for months. Eventually, the woman died despite receiving her mastectomy operation and quality post-care in Colorado where she relocated to live with her daughter, who is a nurse. Regrettably, during this ordeal, the patient was forced to sell her home, relocate to a trailer, eventually move to Colorado and move-in with her daughter, and be subjected to the humiliating rules of the state and federal healthcare bureaucracy which blocked her recovery and care. Despite the heroic efforts by her daughter to get her mother timely and proper care, the patient died.

As I read this heartbreaking story, it occurred to me that the woman’s death was unintentionally expedited by insensitive people in the healthcare industry who made a series of life-and-death decisions to deny her treatment, or enforce policies and procedures in the early stages of her diagnosis that inhibited timely treatment that might have saved or prolonged her life. Had that been their mother, I am sure the roadblocks and regulations would have been removed to facilitate the best possible care. This story is not only a tragedy, but a disgrace to the dignity of every American. Frankly, reading this story angered me because nobody should deserve to suffer and die -- let alone go broke -- when we have the best medical care in the world. There are some national concerns whose interests are poorly served by the twin engines of capitalism and profit. Healthcare is one such national concern.

So, here is our proposal to remedy the healthcare problem in America. It is not perfect and will require refinement. But, it provides a good start for us to move forward and create a national healthcare program we can all be proud of.

Step 1. Establish the National Healthcare Foundation of the United States.
The United States Congress should approve and fund a National Healthcare Foundation (NHF) within the Department of Health and Human Services. The role of the NHF would be to administer a national healthcare program through a network of state agencies that entitles every American citizen and authorized visitors (tourist, student, visa holders, etc) to unlimited primary and emergency healthcare services for any treatment that will enhance their wellness or preserve their life. This includes examinations, diagnoses, surgery, and rehabilitation.

At the core of this innovative national healthcare program would be a network of medical facilities, hospitals, shelters, clinics, and providers who would “opt-in” to participate in the NHF and be fairly compensated for their services. All participants would be required to operate as independent, self-operated, not-for-profit entities. In other words, no for profit businesses would be entitled to receive moneys from the NHF. This requirement will protect the integrity of the new healthcare initiative and remove the profit motive from healthcare. Obviously, this would require some for-profit medical corporations and hospitals to change their current status to “not-for-profit” in order to participate in the NHF. Of course, they can choose not to participate since it is a voluntary program. Individual physicians and other medical professionals who are incorporated as for-profit entities would be exempt from this requirement and eligible to participate in the NHF provided their billings are directed through a bona fide not-for-profit entity such as an NHF member hospital or clinic.

Step 2. The National Healthcare Foundation (NHF) will be funded and paid for primarily by the United States Government through its taxpayers. Every citizen has the right and privilege for primary and emergency healthcare under the same constitutional protections that ensure “life, liberty, and the pursuit of happiness.”

We estimate the annual cost for this program as outlined would be $350 billion in its first year (2009). It would not be cheap; the cost of good healthcare never is. But, this is also a way to control the spiraling costs of healthcare, and, as you’ll read, we can achieve a significant return-on-investment within three years of this plan through some innovative methods and self-funded programs. In three years, this program could actually cost us less than we are currently spending on healthcare today.

As part of the new NHF, all physicians, nurses, clinicians, pharmacists, researchers, technicians and other healthcare professionals -- as well as all healthcare facilities such as hospitals, teaching universities, clinics, and laboratories -- would be paid a fair market wage or fee for their services based on current wages and fees-for-services. These wages and fees would also be reviewed annually for cost-of-living adjustments. This proposal does not require anyone -- doctors, dentists, nurses, clinicians, teachers, administrators, or technicians -- to take a pay cut. These people are professionals and deserve to be paid a premium wage commensurate with their skills, years of service, and degrees of certificates. In other words, this program will reward and incentivize medical providers to further their education and capabilities by paying them more.

As part of this proposal, Congress would create an independent Healthcare Compensation & Insurance Commission (HCIC) consisting of fifteen individuals appointed by the president and confirmed by the Senate from the private and public sector who would establish a code of ethics for all NHF participants and compensation and fee-for-services schedules that ensure fair compensation for all medical professionals and participating non-profit healthcare and educational institutions. The HCIC would also establish regional malpractice insurance rates and set jury award limits for financial claims against medical professionals and institutions that are sued for malpractice and related claims. While mistakes and errors will happen, this aspect of the program would dramatically reduce the exorbitant cost of malpractice insurance and allow doctors and other healthcare providers to focus on serving their patients instead of worrying about malpractice insurance premiums and lawsuits.

Step 3. The National Healthcare Foundation (NHF) would consist of ten divisions. The purpose of these divisions is to oversee the new national healthcare reform program and ensure all Americans receive primary and urgent healthcare as well as foster the research, education, and advancement of the healthcare profession. Each division is described below in general terms outlining their major roles and responsibilities. Additional divisions could be created as warranted.

Primary Care
Urgent Care
Assisted Care, Long-term Care, Child Services, Shelters, Hospices, and Therapy Services
Research & Technology
Organ Donor Programs
Education, Training, and Accreditation
Wellness Treatments
Licensing, Regulations, and Insurance
Payment, Audits, and Enforcement
Administration

1. Primary Care would include primary treatment areas of medicine including, but not limited to the following:

Adult Psychiatry
Anesthesiology/Pain Management
Cardiology
Cardiovascular Surgery
Chiropractics

Dentistry
Pediatric Dentistry
Ear, Nose & Throat
Emergency Medicine
Endocrinology
Family Medicine
Gastroenterology
General Surgery
Gynecology
Infectious Diseases
Internal Medicine
Neonatology
Nephrology
Neurology
Neurosurgery
Obstetrics
Oncology/Hematology
Oral Surgery
Ophthalmology
Orthopaedics
Pain Management
Palliative Care
Pathology
Pediatric Cardiology
Pediatrics
Physiatry (Rehabilitation)
Plastic Surgery
Podiatry
Preventive Medicine
Pulmonology
Radiation Therapy
Radiology
Urgent Care
Urology

Primary Care would also include care for the developmentally disabled, mentally impaired, and treatment programs for diseases such as alcoholism and drug addiction. The NHF would pay for one hundred percent of these services based on a regional matrix formula that fairly reimburses participating physicians and/or medical providers such as hospitals, clinics, and social services agencies at current billing levels. In other words, a family physician in New York City might be reimbursed using Schedule A while a community clinic in Albany might be reimbursed according to Schedule B. The drug treatment center in Macon, Georgia might be paid according to Schedule C, and so forth.

2. Urgent Care is defined as any medical treatment that requires emergency room-related services and ambulatory services to treat life-and-death situations such as heart attacks, seizures, car accidents, shotgun wounds, etc. Such care would be provided by licensed emergency rooms or 24-hour emergency care clinics located across the nation. This non-profit network currently exists with the exception of several rural and poor communities that desperately need medical professionals and local facilities. This level of service would also apply to animal care through veterinarians with a limited annual dollar amount for pet owners. The NHF would pay for one hundred percent of these human services based on a regional formula and payment schedule that fairly reimburses the medical providers for their services and procedures. Veterinarian care would be reimbursed at fifty percent of the cost with pet owners paying the remaining balance.

3. Assisted Care, Long-Term Care, Child Services, Shelters, Hospice, and Therapy. This division would advance the needs of those persons who are unable to independently care for themselves including persons suffering from mental illness, Alzheimer, AIDS, and terminal illnesses. This division would also be the champion of children who require adoption, foster homes, and day-care services for working parents. This division would also support the needs of persons requiring mental or physical therapy.

This division of services also would include those patients who require assisted care living or long-term care situations including hospices. Also, it would apply to those patients who are under psychiatric care, medical counseling, the aged, infirmed, developmentally disabled, persons suffering from physical injuries including paralysis, or persons requiring rehabilitation treatment and therapy.

This division would also fund homeless shelters, runaway shelters, and homes for victims of family violence or spousal abuse. The NHF would also provide greater grant funding to support various state and county government social service agencies.

The NHF program would pay for ninety percent of these services. The other ten percent would be funded through private contributions, grants, and fundraising activities. Patients or family members would not be charged any fee for receiving these services.

4. Research and Technology would advance and encourage the development of innovative medical practices including new medical procedures and treatments, product design, drug research, and other such developments that would enhance the advancement of medicine and its treatment of patients. The NHF program would pay for eighty percent of these services to bona fide not-for-profit institutions and research centers. The other twenty percent would be funded through private sector and public sector grants, individual contributions, and fundraising or advancement campaigns. For profit entities including drug manufacturers would fund their own research and be eligible for grants under other federal agency programs as is currently the case.

5. Organ Donor Programs. This division would advance the existing international network of organ donors, recipients, maintain a national database, and work to promote public awareness and support for organ donations while expanding the international network. This program would be completely funded by NHF including the costs associated with transporting patients, family members, and organs for a medical procedure.

6. Education, Training and Accreditation. This division’s mission would be to advance enrollment and training capabilities of teaching universities and hospitals as well as all other certified and licensed not-for-profit educational institutions that train medical professionals including doctors, nurses, and technical professionals. The NHF would pay for ninety percent of a student’s educational and medical tuition or training that requires a medical degree or healthcare professional certificate. The remaining ten percent would be paid for by the student or through scholarships and grants. The cost of continuing medical education programs would be borne by the individual unless it leads to a medical degree or post-degree certification.

A scholarship program would be required of each participating not-for-profit teaching institution to fund “special need” applicants and non-residents (foreign citizens). Institutions would be required to fund all non-educational programs and services such as administration, facilities management, and human resources as is currently the case. All students receiving funding support from NHF would be obligated to serve-with-compensation in an NHF-certified healthcare facility or practice of their choosing for an period of time equal to the funding they received from the NHF. The current system for accrediting medical colleges, schools, and universities would remain in place and not be funded by NHF.

7. Optional Treatment and Wellness Programs. This division of the NHF would be responsible for overseeing and advancing those medical treatments that are deemed non-life threatening but do enhance the health and self-esteem of individuals. Cosmetic surgery, plastic surgery (not required from a related illness or medical emergency such as an auto accident or burn incident), and wellness treatments such as spas and weight loss clinics would be covered under this section. The NHF program would pay for twenty-five percent of all such services with an annual and lifetime limit expenditure-per-person to be set by the HCIC.

8. Licensing, Regulations, and Insurance. This division of NHF would be responsible for overseeing three key areas -- licensing, regulations, and insurance programs associated with the NHF.

In the Licensing area, all not-for-profit medical facilities seeking to participate in the NHF program, and receiving any federal funds through the NHF, would be required to be certified by NHF or its designees. For example, a not-for-profit medical lab in St. Louis would have to apply for “NHF Licensing” in order to participate in the volunteer NHF program. Certain licensing reciprocity would be available -- including any hospital, laboratory, or medical facility that is accredited by the Joint Commission -- so long as that facility maintained its Joint Commission certification.

The Regulatory unit of NHF would oversee two major reforms that effect healthcare. First, the creation of a national malpractice insurance fund to protect all practitioners and facilities; and, secondly, oversight for the regulation, distribution, and enforcement of all “Re-classified Prescription Drugs” including many of those drugs that are currently deemed illegal today such as marijuana, cocaine, and heroin. These particular reforms are urgently needed in order to curb excessive malpractice insurance rates and end America’s fledgling war on illegal drugs which is costing taxpayers hundreds of millions of dollars. Here is how these two reform programs would work in concert with other federal agencies.

A special Malpractice & Medical Claims Insurance Fund (MMCIF) would be established by Congress as part of the enabling NHF legislation to cover all medically-related lawsuits or malpractice claims against program participants. Why? Because this element of the NHF is the “hook” that will single-handedly encourage over 90 percent of all physicians, dentists, and other healthcare practitioners, who must pay costly malpractice insurance premiums, to enroll in the NHF and support its success. Also, as a volunteer program, the benefits of participating in the NHF must be significant in order to attract widespread national participation among medical professionals and medical care facilities. Regardless of their status as not-for-profit entities or for-profit businesses, medical professionals and healthcare institutions will follow the money! It’s the American way.

Under this proposal, the MMCIF would pay up to ninety percent of all medical malpractice insurance premiums -- as established by the HCIC -- and have the power to cap the dollar amount for all malpractice claims as part of their independent administrative law authority. Participants (physicians, dentists, and healthcare facilities) in the NHF program would pay the remaining ten percent which would sufficiently fund the malpractice program as well as other activities of the NHF. The NHF would be able to contract with insurance companies and agents across the country to administer this program and ensure all participants are in compliance. A reasonable fee-for-service, as approved by the HCIC, would be paid to these companies and agents for their services.

The second major reform deals with solving America’s problem with illegal drugs. Each year, the United States Government spends billions of dollars trying to stop the flow of illegal drugs into our country and arrest, prosecute, and imprison drug offenders and traffickers. While the merits of this effort are laudable, it is a costly war that requires a different solution in today’s global environment. That solution is not the legalization of drugs, but rather, a program that would allow for the regulation and distribution of those drugs under a system similar to our current prescription and pharmaceutical distribution of prescribed drugs.

Under this proposal, the Food and Drug Administration would authorize American-owned drug companies to manufacturer certain drugs in various dosages -- including marijuana, cocaine, and heroin -- to ensure these prescriptions meet rigid federal guidelines for dosage and/or treatment. Federal and state healthcare agencies that oversee current licensing requirements for pharmacies and other prescription drug providers, would license certain drug distribution facilities to dispense medically-approved prescriptions of those drugs to persons who require them for medicinal purposes or to treat their addiction. As part of any legal prescription from a physician, every patient using these “recreational” drugs would be required to participate in a licensed counseling and treatment program which would be paid for by the NHF as part of its Primary Care Division.

This drug reform program would have many beneficial effects. First, it would severely reduce the activities of illegal drug cartels in foreign countries and allow the Drug Enforcement Agency (DEA) to focus its vital resources on other important activities. Secondly, it would reduce property crimes and felonies by drug users who must “feed their addiction.” Thirdly, it would reduce gang violence in major cities and reduce the need for gang involvement. Fourthly, it would allow the medical community to adequately treat people with addictions. Fifth, it would reduce the prison population since more people will receive treatment for substance abuse in a medically-controlled environment and, thus, they will not be engaged in criminal activities nor be imprisoned for criminal offenses. This program would be funded completely by NHF. The cost savings to DEA and other drug-fighting agencies justifies this reform proposal.

9. Payments, Audits, and Enforcement. The NHF would establish a Payments, Audit, and Enforcement Division to handle all claims and funding requests from program participants. By law, payments for treatment and services would be paid within thirty days of billing to all approved, first-party payees (physicians, hospitals, clinics, etc) or the NHF would be required to pay interest to those providers. The NHF could contract out payment services to approved third party contractors or state agencies.

The Audit Division would be responsible for overseeing compliance of all NHF and HHS rules and requirements for billings and payments.

The Enforcement Branch would be given full federal law enforcement powers and be responsible for enforcing all NHF and HHS laws and regulations. Alleged violators would be referred to the United States Attorney for prosecution. Violators also could be fined, imprisoned, or banded from NHF program participation if found guilty of fraudulent activities or unethical conduct.

10. Administration. This division would encompass the typical administrative and support functions of a major government agency including but not limited to: human resources, government relations, inspector general, legal, regulatory affairs, and budget.

In Conclusion:
This description is not meant to be all encompassing, but rather, it is an attempt to advance the discussion on how to establish a progressive healthcare program that ensures all Americans will receive the finest medical care in a timely and affordable manner. The cornerstone of this proposal is that it is national in scope, available to all Americans, voluntary in its participation, and it removes the profit motive from healthcare through the not-for-profit participation requirement.

Certainly, there will be some people who do not believe in offering free primary and urgent medical care. Others will argue the national cost for such a program is too high. We would strongly disagree with both arguments because we believe that every human being has the right to health and wellness in America. If we do not create a meaningful healthcare solution soon, the costs will soar beyond our control. A progressive healthcare program is the right thing to do given who we are as a people and what we stand for as a nation.

And, in response to the cost of this program, certainly, a network of not-for-profit healthcare facilities, staffed by America’s best-and-brightest medical professionals, would be money well spent and enhance the quality of life for all Americans.

Also, let me comment on the naysayers who are critical of national healthcare programs in England, France, Canada, Australia, and elsewhere. I am not suggesting that these programs must become our model. Nor am I suggesting that we must emulate all of their practices. But, we are suggesting that these programs work and they work well. If those national programs were inept, citizens would be protesting in the streets. So, there must be some merit in their programs. Our question is this. What are their best practices? And, secondly, can we apply those best practices to a “Made in America” national healthcare model?

In closing, I would not wish it upon anyone to be that person who must look your mother in the eye and tell her, “I’m very sorry, but we will not treat your breast cancer at this physician’s office or medical facility because you don’t have adequate insurance and our doctors aren’t able to take on any more charity cases.”

Regrettably, those words are being repeated, over and over, every day in medical offices and insurance companies by otherwise caring people whose job it is to put profits ahead of the healthcare needs of human beings. It’s time we put an end to this unethical and inhumane practice in the United States of America. Through this proposal we can achieve something significant that all Americans will be proud of.

Thank you.

What California's Consumers Really Care About

2007-10-09T16:52:00.000-07:00

by Tom Hinton
www.tomhinton.com

If you’ve been reading the newspapers and watching the local and regional newscasts these past few weeks, you might have the mis-impression that what California consumers care about are the growing number of Nigerian letter email scams and being ripped off by used car salesmen. Certainly, these are nuisance issues, but let’s get serious for a moment. I’ve been traveling our Golden State for the past few months and talking with ordinary people about what’s on their minds. Here’s what California consumers really care about.

1. Will we be able to make our Mortgage Payments?

This economy is a slippery slope. You have nearly five million California wage-earners who are living from paycheck to paycheck; and, despite the upbeat economic performance in certain industries, most CaliforniaCalifornia consumers have lost their enthusiasm to spend money and they are deeply troubled by the economic uncertainty. Frankly, Californians don’t expect much positive news for another 12-24 months. consumers are troubled by the uncertainty that lies ahead. This is especially true in terms of the housing market which is the “alternative retirement savings system” for most Californians. The downturn in home values is a serious concern for Californians. It’s also the reason why Californians have cut back on major purchases such as automobiles, furniture, appliances, and holiday vacations and are waiting on the sidelines to see what happens. Most

2. When will America End the War in Iraq?

That was a nice gesture by our governor to send 3,000 cigars to the Californian troops serving in Iraq. But, the harsh reality is this. Will our troops live long enough to smoke them? Californians (along with the rest of the nation) are fed-up with the mismanaged war in Iraq. Democrats and Republicans alike are tired of reading about the sacrifices our troops and civilians are making day-after-day in this “no-win” situation. And where is all that oil going from the pipelines in Iraq? Who’s reaping the profits from the Iraqi pipelines? Nobody seems to be talking about issue that anymore. Americans support our military and we also love a good fight. But, nobody likes a bad game plan. Frankly, the Iraqi conflict is depressing to our national spirit. Until a new president and Congress --yes, the 110^th Congress now shares the blame because they’ve not honored their campaign promises from 2006 to end the war -- assume power in Washington, DC and set a specific timeline to end our involvement in Iraq, the enthusiasm consumers should have in good times will remain flat.

3. When will the Price of Gasoline Drop?

California consumers don’t like paying high, inflated gasoline prices at the pump. We haven’t got used to the idea of $2.80 per gallon and we’re very upset with the outrageous profits major oil companies are posting each quarter as a result of their unfair gasoline prices. Californians want some relief! But, we also know our elected officials at the state and national level have been bought and paid for by Big Oil’s campaign contributions… which brings us back to Issue #2.

4. When will the Golden Gate Bridge Collapse?

California consumers are troubled by the decaying infrastructure of our roads, bridges and reservoirs. The governor is on top of this issue and wants to build more reservoirs, but he faces an uphill fight with small-mind special interest groups that oppose their construction. Hopefully, the governor will prevail. The bigger issue, however, is that California’s roads and bridges need a facelift. We need to appropriate the necessary moneys to rebuild and upgrade our statewide infrastructure before a Minneapolis nightmare occurs in our state.

5. Are my Kids Safe at School?

California consumers don’t like unsafe schools. School districts and university regents need to get off their seats and ensure our schools and college campuses are safe. Certainly, no one can predict a madman’s erratic behavior. But, we should have in place strategic plans that can intercept and prevent another Columbine or Virginia Tech tragedy.

And, while we’re on the subject, why have we reduced our teachers to professional babysitters? Let’s face it. School is not for everyone. Why is it that we force juvenile delinquents -- to attend school and ruin the experience for everyone else? There are some kids who just don’t want to learn. Schools should have the right (without jumping through twenty legal hoops) to expel such misfits. These kids would be better served by attending vocational training or getting a real job. I’m not suggesting society give up on them. But instead of forcing them into a structured educational environment, we need to find alternative outlets that challenge them and encourage them to move in that direction. Granted, the social misfits represent a very small percentage, but this small percentage is actually costing schools in terms of time, attention, and valuable resources. It’s grossly unfair to the 99% of students who want to learn and get ahead in life. Let’s wake up and stop asking our teachers to double as babysitters for these misfits.

It’s not a question of “leaving no child behind.” It’s a matter of moving the rest of the class ahead! Most teachers and school administrators can tell the difference between a student and a juvenile delinquent. Let’s allow our teachers to teach and stop babysitting the trouble-makers.

About the Author:

Tom Hinton is a California Consumer. He is a popular business author and speaker who frequently writes for publications on consumer issues and business trends. He can be reached at tom@tomhinton.com