Tuesday, July 28, 2015
Tuesday, June 19, 2012
I said that I hoped to foster an environment where each one of us would feel entirely comfortable with dissent, an environment where we would welcome someone challenging each other’s ideas, questioning our assumptions, and basically being a bit of a pain. I hoped that we would become a bit “thick skinned” and able to tolerate a healthy degree of criticism. I hoped that, while we would know our business well enough to defend our position, we would also respect our colleagues enough to want to listen very carefully to what they said, in order to understand if we hadn’t communicated our point well or if possibly they had observed a new wrinkle in the problem that we had missed.
I believe that we can all help each other become better employees, better serving our member/owners with safe, reliable, clean and affordable energy. Even if I am considered the expert in a particular area (and most of us are expert at something), I think that there is still the possibility that an “outsider” (someone without our training and experience) might see something that we had missed, and in that insight there might be tremendous business opportunities.
George Bernard Shaw said “…all progress depends on the unreasonable man.” The reasonable man always tries to get along, always tries to follow the rules, to sustain the status quo. At best, the reasonable man can only produce incremental change. Not that incremental change is bad; to the contrary it has been a tremendous part of the history of electrification. Engineers are great at driving incremental change. They are usually not so good at innovation.
The unreasonable man challenges the status quo, tries to leap tall buildings in a single bound, and asks “why not?” We need to make sure we’re listening.
So, for all you unreasonable men and women out there, I have some advice: learn to disagree without being disagreeable; and learn to accept criticism without being critical. Understand that the real goal is for all of us to get better at what we do, and realize that together we can make better decisions when we include greater diversity of experience in our decisions. Welcome dissent. Embrace it. Get comfortable with it.
Thursday, October 27, 2011
This Beatles’ song is in my mind, because on November 14 I will start a new role at an Arkansas energy company.
As I leave my existing position in Missouri it seems as if I’m saying goodbye to many friends, but this is just an illusion. It’s more of a farewell than a goodbye, or even better it’s “until we meet again.”
As I say hello to Arkansas I am eager to make new friends, and this shouldn’t be too hard, since everyone I’ve met so far has been incredibly friendly and warm. Hello, Arkansas, it’s nice to meet you!
A close friend asked me, “Why are you doing this? For your ego or for the money?”
Now don’t get me wrong, ego and money are great motivators, but they aren’t the key to long-term satisfaction. So why move then, why challenge myself, why not just coast to retirement?
In the 10th century BC, King Solomon said, “a man can do nothing better than to eat, and drink, and take satisfaction in his work.” That’s why I’m doing this --- to take satisfaction in my work.
As I start this new position, it’s all about possibility. New friends. New opportunities. New ways to serve. It’s a thrill to consider how the next few years will develop.
So hello/goodbye/hello/goodbye. I don’t know why you say goodbye, I say hello!
Thursday, August 18, 2011
That’s how I’m feeling today. Optimistic. Born at the right time.
Bob Prosen said, “at the beginning of the day, it’s all about possibilities. At the end of the day, it’s all about results.” One could paraphrase that to say, at the beginning of a life, it’s all about possibility. At the end of a life, it’s all about results. That’s how the world looks at it, isn’t it? Deliver or die.
When we see a new baby, it’s like Paul Simon’s song. The child has a new life before her. She has never felt disappointment, or had a bad day, or complained about her boss. Her life has the possibility to be perfect.
Before too long the pressure of the real world bears down on all of us, demanding results. We fail. We recognize that our dream of a perfect life is not going to happen. We become pessimistic, and if our outlook is negative, it’s going to rub off on our friends, family, and coworkers. Who wants that?
Last Sunday in my church a visiting pastor from a foreign country offered an observation in somewhat broken English. He said, with an air of optimism, “Remember, today is a day that you’ve never lived before.” I started thinking about that statement and it really connected with me. Today really is a day that I’ve never lived before. I can look back on my life and remember several incredibly memorable, fantastic days that stand out, days that I’ll never forget. Wonderful days that I never want to forget. And I thought, maybe today, a unique day of possibility that I’ve never lived before, is going to end as one of those days that I’ll remember the rest of my life, a fantastic day that I’ll never want to forget. Why not?
I know that today may seem like just another ordinary day to you, but imagine the possibility of what could happen in the next few hours. Can you imagine that today could end so well that you would want to remember it for the rest of your life? Now, with that in mind, I want to ask you, what could YOU do to make that a reality? Could your behavior in the next few hours make a difference, possibly influence the outcome of this otherwise ordinary day?
Keep this in mind as you interact with your kids and colleagues today. Lift them up and maintain a positive outlook. After all, today just might be the best day of your life, a day that you’ll never forget.
Today is a day that you’ve never lived before, and you’ll never live again. Make it a great one for you and your friends.
Thursday, May 26, 2011
Tuesday, April 26, 2011
When I was a young man I didn’t understand the nuances of relationships. Really, I was pretty clueless. Over the years I made a lot of mistakes and got a lot of advice, some good and some bad. Despite all this well-intended advice I was somehow able to meet the love of my life, and she has stuck with me for an amazing 29 years of trial-and-error. Now that I am older (much older) I’d like to think that I’ve learned a thing or two about the games people play.
Which is what makes it so hard when you see your teenage and early 20’s children struggling with relationship issues.
Over the last several years I’ve watched my sons riding high on the wave of romance, a dance in their step, a wink in their eye, and a joy for life, all because a new girl has appeared in their life. In contrast to this I’ve watched in agony as they struggle through breakups. It is painful for them and painful for me. What I really wish is that they would just let me run their life; tell them what to do. That would solve everything, wouldn’t it? I could just use my great experience from a lifetime of relationship struggles to offer some guidance and straighten things out.
But it doesn’t work that way. It seems that every generation has to work this out on their own. To paraphrase Dr. Martin Luther King, Jr., is it necessary that darkness exist, just to demonstrate the beauty of light? Perhaps we have to experience the pain of the breakup before we can fully enjoy the delight of commitment.
So here’s to all young people everywhere who are struggling with relationships, and to their parents who care enough to try and offer their advice. May we learn to listen to each other.
(This article appeared in the Operation Us newsletter. You can view more articles by me and other Dads at http://www.operationus.org/library/articles/straighttalk.html.)
Saturday, March 19, 2011
My friend Cindy Blackmore has published two books documenting her and her husband's spiritual journey, following a bicycle accident that left him completely paralyzed and dependent on a ventilator. You might think this is a tale of woe, but quite the opposite. This second book is a compilation of the emails that she shared with her friends and family throughout their life together. Both will lift you up much more than you can imagine.
Check out the youtube promotional videos here:
Remember to Laugh Youtube video
The Journal of Our Journey Youtube Video
You can order her books here:
Remember to Laugh Xulon Press Order Site
The Journal of our Journey Xulon Press Order Site
I had a special rememberance of her husband posted previously in this blog. You can read it here:
Remembering Doc Blackmore
Thursday, March 3, 2011
Recent research discussed in Harvard Business Review suggests the optimal size for a decision-making group is seven. Each additional member added above seven decreased the group's decision-making effectiveness by 10%. Mathematically think 0.9^(x-7) for x>7.
Jesus had 12 disciples, but I'm not sure they count as a decision-making body. And I'm not about to question the plan.
My comany has a 12-member board of directors. I'm not questioning that wisdom either. But might their decisions be only 59% of their potential? That's almost like having half your brain tied behind your back!
Tuesday, February 22, 2011
My latest "Straight Talk from Real Dads" article for the Operation Us newsletter is out. This one talks about helping your children say goodbye to loved ones as they face the end of their life on earth. I wrote it based on my experience saying goodbye to my mother in her final hours.
You can read it at this link: Saying Goodbye
Saturday, February 19, 2011
In some ways this is the curse of leadership. Think about it; in a reasonably well-run organization, there are not enough hours in the day to report on everything that is going right. "Fuel arrived on time today." "We didn't hear any employee grievances today." "Twenty-seven bids came in under budget today." These are statements that you will not hear, and you probably really don't want to spend time with.
By default, in your job or leadership role you are only going to hear about exceptions, inconsistencies. There is no need to spend your time dwelling on the unexceptional examples of great performance that abound around you.
The more people you have working with you in an organization, the worse this problem becomes. As your responsibilities increase, you will spend more and more time dealing with increasingly bigger exceptions, inconsistencies, and problems. You should thank God for this. The fact that the problems are being identified is a good thing; without that you could not begin to work on them or improve them. Now you can use your intellect to find solutions: organizational structural improvements, procedural improvements, and seeking changes in people's skills and the ever-elusive cultural change.
Friday, February 4, 2011
You know how it is. Your kids are small, growing up, and you're busy with basketball games and PTA meetings and scouting and running errands and doctor appointments and playing with the dog and every now and then if you do get a little free time you discover that the way you'd really like to spend it is to sleep! But there is definitely no time for watching old videos of your kids. Plus, who likes to see themselves in those things? No one, that's who. My voice sounds weird! I look fat! Is my bald spot REALLY that big? The camera must be lying.
But put those videos away for ten or twenty years, and they take on a new, almost magical quality. Now I know why we took them. So they could make us humble. So they could inspire us. So they could remind us of how small our problems are today, how good we have it now, and how hard it was then when we were raising four little ones. Someone was always screaming! Someone was always crying! And we all looked so young and virile.
Read the rest of this article on the Operation Us website. See it here (click link).
For the parents of young adults, there are two types of moving-away-from-home events: the sad-beginning, and the happy-ending. The sad-beginning occurs when the youth leaves home for the first time. Lots of tears and anxiety accompany this departure. After a few weeks the parents realize that they can function without the young adult and the young adult thinks ditto. This event precedes the happy-ending moving-away event, which may not occur for several years. This is when the parents decide that the youth has established their own household and can finally take responsibility for all that stuff they left behind. And that is the event that my wife and I are celebrating this weekend. When I was young I couldn't understand the look on my parents' faces when they visited my house one afternoon with a carload of my former junk from their basement. They were beaming with joy. "Here is your stuff," they declared. Wait a minute, I thought, I don't have room for all this stuff. Can't you just keep it for a while longer? Don't you have plenty of room in that big house of yours?
Read the rest of this article on the Operation Us website. You can see it here (click link).
Tuesday, November 23, 2010
Moving out - a celebration of this essential transitiion period:
Our personal travel odyssey:
Planes, Busses, and Aircraft Carriers
A recent desert hike gone dry:
And finally, dealing with our fears:
Wait guys, wait!
Thursday, July 1, 2010
"Dad, I'm getting married." Few words make a dad feel so powerless, even a little scared, and yet so proud. The single biggest decision our children can make is choosing a lifetime companion. The stakes are high.
Read the rest of this article on the Straight Talk from Real Dads column appearing in the Operation Us monthly newsletter. Check it out:
Here is the link to the article on Operation Us
Tuesday, April 27, 2010
You have to climb the mountain. Read more in my article posted to the Operation Us website, Straight Talk from Real Dads.
Find the article at this link: Climbing Mountains article on the Operation Us webpage.
Thursday, April 22, 2010
Earth Day Predictions from the first Earth Day in 1970
(compiled by Neal Boortz)
"We have about five more years at the outside to do something."
Kenneth Watt, ecologist
"Civilization will end within 15 or 30 years unless immediate action is taken against problems facing mankind."
George Wald, Harvard Biologist
"We are in an environmental crisis which threatens the survival of this nation, and of the world as a suitable place of human habitation."
Barry Commoner, Washington University biologist
"Man must stop pollution and conserve his resources, not merely to enhance existence but to save the race from intolerable deterioration and possible extinction."
New York Times editorial, the day after the first Earth Day
"Population will inevitably and completely outstrip whatever small increases in food supplies we make. The death rate will increase until at least 100-200 million people per year will be starving to death during the next ten years."
Paul Ehrlich, Stanford University biologist
"By... some experts feel that food shortages will have escalated the present level of world hunger and starvation into famines of unbelievable proportions. Other experts, more optimistic, think the ultimate food-population collision will not occur until the decade of the 1980s."
Paul Ehrlich, Stanford University biologist
"It is already too late to avoid mass starvation."
Denis Hayes, chief organizer for Earth Day
"Demographers agree almost unanimously on the following grim timetable: by 1975 widespread famines will begin in India; these will spread by 1990 to include all of India, Pakistan, China and the Near East, Africa. By the year 2000, or conceivably sooner, South and Central America will exist under famine conditions....By the year 2000, thirty years from now, the entire world, with the exception of Western Europe, North America, and Australia, will be in famine."
Peter Gunter, professor, North Texas State University
"Scientists have solid experimental and theoretical evidence to support...the following predictions: In a decade, urban dwellers will have to wear gas masks to survive air pollution...by 1985 air pollution will have reduced the amount of sunlight reaching earth by one half...."
Life Magazine, January 1970
"At the present rate of nitrogen buildup, it's only a matter of time before light will be filtered out of the atmosphere and none of our land will be usable."
Kenneth Watt, Ecologist
"Air pollution...is certainly going to take hundreds of thousands of lives in the next few years alone."
Paul Ehrlich, Stanford University biologist
"We are prospecting for the very last of our resources and using up the nonrenewable things many times faster than we are finding new ones."
Martin Litton, Sierra Club director
"By the year 2000, if present trends continue, we will be using up crude oil at such a rate...that there won't be any more crude oil. You'll drive up to the pump and say, `Fill 'er up, buddy,' and he'll say, `I am very sorry, there isn't any.'"
Kenneth Watt, Ecologist
"Dr. S. Dillon Ripley, secretary of the Smithsonian Institute, believes that in 25 years, somewhere between 75 and 80 percent of all the species of living animals will be extinct."
Sen. Gaylord Nelson
"The world has been chilling sharply for about twenty years. If present trends continue, the world will be about four degrees colder for the global mean temperature in 1990, but eleven degrees colder in the year 2000. This is about twice what it would take to put us into an ice age."
Kenneth Watt, Ecologist
Friday, April 16, 2010
The whole problem with this behavior is that it doesn't do anything to solve the problem or improve the situation. It just keeps everything in a state of suspended animation, with no resolution. This behavior can put an organization into gridlock, slowing performance to a crawl, suffocating innovation and creativity.
What is the solution to withdrawal and avoidance? First, recognition that there can be no progress without resolution of the issue. Putting off the resolution only delays the time until improvement can occur. Most people don't want to hurt improvement and progress. Often just the recognition that the organization (and your own peace-of-mind) will be better served by action rather than by inaction is enough to allow you to overcome your desire to crawl into a hole and allow you to face up to the conflict.
Second, you must actually discuss the undesirable behavior with your protagonist. After escalation or invalidation a short emotional cooling-off period is often required, but don't wait too long to get the subject on the table, discussed and dealt with. If you find it hard to start the conversation, it can be helpful to acknowledge your feelings, e.g. "This is hard for me to say, but I think it is important that we discuss this. I am uncomfortable leaving it buried. I think we should talk about it for the benefit of the organization."
You will be amazed at how often the other party follows such an introduction with an apology of their own. This clears the air and lets you get back to work on making things better.
Tuesday, April 13, 2010
The only thing necessary for the triumph of evil is for good men to do nothing.- Edmund Burke
I am reading these words at the bottom of an email from my 24 year-old son. He uses this message as part of his email “signature”. He also uses it as his voicemail message on his cell phone. Instead of saying "this is Jason, leave a message" he says, "the only thing necessary for the triumph of evil…” etcetera, and today I'm reading it as if for the first time, and wondering, just how did it get there?
Since when did he become so principled? Is this the same young man who couldn't be “persuaded” (read that as forced) to clean his room, who didn’t want to get out of bed in the morning, who was afraid to take off his training wheels and ride his bike? Perhaps I need to adjust the way in which I look at my son.
I have had several of these moments in the last few years, moments in which my world was turned upside down, or at least skewed, in a good way. These were times when my expectations weren't met . . . but they were surpassed, times when I found myself learning from my son, instead of the other way around. And as a Dad it feels good, very good, to have finally arrived at that point.
My oldest son serves in the U.S. Navy with responsibility for maneuvering a ship that is 600' long. I had a chance to visit the ship as it was being brought into port, and it struck me that although I still get nervous when he asks to borrow the family car, the Navy is entirely comfortable asking him and a bunch of his twenty-something peers to drive this billion-dollar ship. Maybe its time for me to rethink our roles and let go a little. Or let go a lot.
Another son now in college has an incredible knowledge of religious studies that I can never attain. Is this the same kid that I could not motivate to get out of bed for church?
Even my high-school-age son is coaching me on my jogging stride and teaching me new licks on the guitar.
All this is to say that my three sons, as hard as they have been to raise, are now beginning to bear their own fruit and it’s wonderful to watch. At the time when you are surrounded by dirty diapers and stuffed animals things can get pretty discouraging. You may wonder if your kids hear a word of what you are saying, and if anything will ever make a difference, but if you just hang with it through all the tough toddler-to-teenage years you might find that your kids will emerge in their twenties to surprise you in the most delightful way.
So stick with it. Keep on parenting. Don’t give up the fight. If I may plagiarize Edmund Burke, “The only thing necessary for the triumph of evil is for good Dads to do nothing.”
This article originally appeared on Operation Us. They offer marriage and relationship skills education resources. You can read more at this link (click here).
"You left the extension cable in the doorway again."
"Why are little things so important to you? Just put it back." (an dash of invalidation here)
"Are you too lazy to do it?" (slipping in a little negative interpretation in the mix)
"Listen, you are always riding me about stupid trivial stuff. I'm not going to do it. What are you going to do about it, fire me?" (in this example of extreme insubordination, the answer might be yes)
Consider the alternative to escalation.
"You left the extension cable in the doorway again."
"Why are little things so important to you? Just put it back." (an dash of invalidation here)
"Things like that ARE important to me, because I feel like housekeeping reflects on all of us." (validating their comment and trying to explain the reasons for it)
"Ok, I'm sorry that I was so short with you. I'll try to keep things more organized."
When you sense escalation beginning, try to soften your tone, acknowledge the other person's feelings, and offer some humility . Humility is not an attribute that we often celebrate in America. Our heroes are supposed to be strong and forceful. But a small dash of humility can go a long way towards better workplace relations.
And it works pretty well at home, too.
Monday, February 22, 2010
I love riding roller coasters. My wife, on the other hand, is not a fan. So, when it came time to expose our children to the joys of roller-coaster riding, it was to be my personal pleasure to introduce them to this wonderful, thrilling invention of man. Or so I thought.
I can remember the day when each of my children took their first roller coaster ride. The excitement, dread and anticipation was almost too much to bear, as they struggled with their decision, to ride or not to ride, then decided to go forward, reluctantly. Imagine my frustration, eagerly anticipating the ride to come, and the joy of sharing the experience with my child, and waiting as patiently as possible for up to an hour or more in the amusement park line, all the while watching as the child becomes more and more nervous, trying to make small talk, distract, change the subject, only to find him bailing out in tears just before boarding the ride.
For some of them it took several years to get up the courage to ride. I had to wonder, will I ever have someone to share this roller-coaster experience with?
Last year I went to Bush Gardens with these same formerly reluctant, roller-coaster adverse children, all of them now in their teens or twenties. Bush Gardens, for those of you who may not be familiar, is a roller-coaster enthusiasts’ dream with at least five fantastic coasters. And we rode them all. Over and over. And over. And over. Until I, the roller-coaster master, the undisputed king, the self-taught Jedi of g-forces, had to quietly say, “enough”.
And at this my boys said, in echoes of my own voice, “Come on dad, let’s ride again, please will you at least try to ride with us?”
And I found myself saying, in a voice that sounded almost child-like, “I think I’m going to be sick.”
So, does this mean my parenthood journey is completed? As the great philosopher-father Kal-El in the superman comics said, “The son becomes the father, and the father becomes the son.” Something amazing happens to our children we age together, and it is nothing short of a miracle.
I see this same behavior repeated in a number of other areas: seeking a job, filing a tax return, and going out on your first date. Not that I want to accompany my children in all of these activities, but I do see the same reluctance, fear, and second-guessing, and finally, with continual patient encouragement, an eventual victory to be celebrated. Sometimes they even surpass my own accomplishments and go on to greater and greater achievement.
It’s a wonderful transformation. So keep on pushing your kids. Let’s get on the coaster and ride. At least until I throw up.
This article originally appeared in the Operation Us newsletter. Operation Us is an initiative of Springfield, Missouri based Forest Institute. They received a grant from the U.S. Department of Health and Human Services to promote healthy marriages, relationships and families. You can read more here: Operation Us website (click here)
Tuesday, February 9, 2010
Negative Interpretation occurs when someone commits the Fundamental Attribution Error. How's that for clearing up ambiguity? The Fundamental Attribution Error is Harvard-speak for this: the bias of attributing the observed behavior of an individual to personality factors rather than external situational factors. For example, we may assume that an accident occurred because an individual was lazy instead of because of a lack of training.
If I act reluctant to sit down to watch a movie with my wife, she may incorrectly assume that "you didn't really want to watch that movie with me" or even worse, she may combine negative interpretation with invalidation and pull off a zinger like, "you never like watching the movies I like." The truth may be that I was just tired from a long day, or that I had a task I was really wanting to complete first (really darling, that's my story and I'm sticking with it!)
The same thing happens around the office when we commit the fundamental attribution error and communicate our negative interpretation to our coworkers ("are you just trying to get out of work?") When we do this, employees become less motivated, less engaged, and less willing to work with us because they feel that we are not really listening to them or trying to understand things from their point of view.
To overcome this tendency, try to force yourself to look for evidence that is contrary to your negative interpretation. If you find yourself thinking "that person is just lazy" then ask yourself, "are there any other possible reasons for this behavior?"
Try this at home. See what happens. Then try it at work too.
Wednesday, January 27, 2010
Invalidation is a process by which a spouse, supervisor or coworker, upon hearing a new idea or suggestion, proceeds to ridicule it, criticize it, and openly or subtly demeans the person making the suggestion. Be on the watch for invalidation. Some people do it constantly without realizing it.
The opposite of invalidation is active listening. Make sure you have heard and UNDERSTOOD what the other person is saying before you start to criticize it. And if you do have a criticism, make sure that you are criticizing the IDEA, not the person.
Invalidation can crush creativity in an organization. Think about it; if you are constantly ridiculed for your ideas, how likely is it that you will keep offering them?
Tuesday, January 26, 2010
Monday, December 7, 2009
When I was at New Madrid last week a mechanic offered his thoughts on preventing a repeat equipment failure. This item had been reviewed by the OEM and recommendations had been made, but I think his suggestion was excellent, not just from a practical functionality standpoint but it was also very inexpensive, almost free!
Don't forget to ask the question - someone just might have a better idea.
Friday, November 27, 2009
1979 may offer a glimpse into 2009, and we may learn something about the current recession by looking back at how the industry fared in post-1979 recession of the early 1980s.
Life in the late 1970s
In the mid-1970s, electric utilities in the United States were struggling to keep up with the growth in electricity demand. Nationwide demand was creating shortages of critical plant equipment such as turbines, generators, and large transformers. Prices were increasing rapidly, and with rapid load growth utilities found it hard to keep up with demand. As a result, they were making commitments for ever-larger plants, more frequently.
At Associated Electric, each generating unit was larger than the last. The 1960s ended with the completion of Thomas Hill Units 1 and 2. In the 1970s New Madrid Units 1 and 2 were completed in 1972 and 1977. So, at the end of the 1970s it was not at all unusual to consider adding Thomas Hill Unit 3, Associated's largest generating unit, planned to come on-line in 1982. In addition to the coal-based projects, Associated made commitments for a share in a large nuclear power plant, the Black Fox Nuclear project.
In the last 50 years in the U.S. there has never been a significant rise in the price of oil that was NOT followed by a recession. The Iranian Revolution of 1979 was just such an event. Oil prices shot up, driving inflation, and the US Federal Reserve enacted a tight monetary policy in response. This led to the extended 22-month recession of 1980-1982.
Increases in energy prices led to increased conservation by consumers, with the result that, by the time Thomas Hill Unit 3 was completed in 1982, not a single megawatt of its output was needed to serve customer demand. The 670 MW unit was entirely surplus to Associated's needs.
We weren't the only utility in this situation. Many of our neighbors had also made commitments for large generating units and the entire region found itself with extreme surplus capacity.
Moving into the 1980s
In order to pay for the increasing fuel costs and unneeded generating capacity, Associated enacted a series of rate increases throughout the early 1980s. The rate increases in turn resulted in further reductions in the rate of growth of customer demand.
In the years that followed in the early- to mid-1980s, Associated found that it could replace the output of its coal units at a price equivalent to running them. There was no longer a reason to spend extra money to shorten scheduled maintenance outages. Policies were enacted to suspend the use of overtime to shorten outages. A program known as “intermittent operation” was initiated at the New Madrid plant, in which one of the two units was shut down for economic reasons, and some of the workforce experienced a layoff.
Then and Now
Compare this situation of 1979 to our current situation. Since 1999 we have been building new generating capacity at a rapid pace. Intense worldwide competition for equipment such as turbines, generators, and transformers resulted rapid escalation in the cost of new plants. Strength in the rural Midwest economy kept customer demand increasing at a constant, reliable pace. Associated planned its next large generating unit (first Norborne, then Chouteau 2) and considered a commitment to a share of a large nuclear unit.
To cover increasing fuel and environmental-control costs, Associated enacted a series of rate increases over the past four years, putting additional pressure on customer demand.
There was not an Iranian Revolution, but in 2008 U.S. oil prices reached an all-time high following the announcement of Iranian missile tests. While the recession that followed is largely blamed on the collapse of the housing market, collateralized debt obligations and mortgage-backed securities, the increase in energy prices was a significant trigger to the mortgage meltdown.
Now one year later we find that customer loads are no longer growing at their former pace. The large generating unit under construction at Chouteau 2 is now expected to be entirely surplus at the time of its completion in 2011. Our participation in a previously planned nuclear unit has been suspended, and the equipment for our planned 100 MW peaker at Essex 2 has been placed in storage.
It is likely that we will find our neighbors with similar surplus capacity. New large coal-based units were recently completed in southwest Iowa and southeast Nebraska, and other units are nearing completion in Kansas City, southwest Missouri, northeast Arkansas, and western Illinois.
Even today our coal-units do not have the same value they had just a few months ago. Natural gas prices have collapsed, driven by low demand and high storage reserves. While we cannot yet buy energy for the same price as production, we are getting very close to those levels.
So, is it likely that we will see the situation of the early and mid-1980s repeat itself in 2010 through 2015? Might we see years of low customer demand growth? Might we find ourselves with the ability to buy surplus energy from our neighbors at prices competitive with our existing units? Might we find ourselves shutting a coal unit down for economic reasons? How might this impact utility negotiations with labor unions, railroads, and coal companies?
There are two additional significant factors that were not present in the 1980s: shale gas and carbon-dioxide regulation. Massive domestic reserves of natural gas trapped in shale formations, formerly considered uneconomic to recover, are now being extracted at very low incremental costs, a result of improved horizontal drilling technology. These reserves will put a price cap on natural gas, keeping our fleet of high-efficiency gas-based units competitive with some coal-based units. And the currently debated cap-and-trade bill, if passed, will further increase all energy prices, further depressing demand and placing coal-based units at an even greater disadvantage.
This future may NOT come to pass. This current recession could end and we could return to business as usual. But, if the current forces continue, we will need to maintain tighter cost control and top-tier unit performance in order to remain competitive in the market. Those who can do this well will survive. Those who cannot may find themselves looking for work. We want to be the former.
What do you think – are we back in the 1980s or will the roaring 1990s return? I would love to hear your comments.
Sunday, November 15, 2009
Emphasis on our core mission – maintenance and reliability of our power plants, especially our coal-based units.
Emphasis on cost consciousness – this is a key part of our mission and vision. I want to make sure we are all living it. One objective of my training was to gain a broader industry perspective. After all the case studies and exposure to classmates from 160 businesses in 44 countries I have developed an increased appreciation for the importance of continued vigilance on costs.
Exploring the application of Social Networks – I had the opportunity to experiment with social networking tools such as Facebook, Linkedin, and blogs during my training, and I have seen how these tools work to improve communication and “flatten” the organization. I see a high potential for using these and similar methods for online collaboration across multiple locations. I am very excited about some new Sharepoint tools that will soon be available on our office intranet. They will provide us with in-house capabilities similar to those available today on the unsecure commercial sites.
Continually explore alternate and divergent ideas –it is easy for a business to fall prey to groupthink and complacency and miss significant opportunities and threats. We studied a number of examples of human-system failures, from Everest mountain climbers to NASA engineers to managers of financial services companies. In every example, humans are humans, and we share some common biases that often prevent us from seeing events outside our expectations. I will be using some new techniques to lessen the likelihood of becoming the next Harvard failure case study.
I am eager to hear from each of you on these ideas. Please feel free to share your comments online or by email. Think of it this way: if you hesitate to share an idea that you think could help us improve, you may be delaying our progress!
Friday, November 13, 2009
Sunday, November 1, 2009
Friday, October 30, 2009
Final class, final day, final advice from Harvard (alternate title: Why would I ride a motorcycle to Boston and back?)
to weep is to risk appearing sentimental,
to reach out to another is to risk involvement,
to expose your feelings is to risk exposing your true self,
to place your ideas and dreams before a crowd is to risk their loss,
to love is to risk not being loved in return,
to live is to risk dying,
to hope is to risk despair,
to try is to risk failure.
But risk must be taken because the greatest hazard in life is to risk nothing. The person who risks nothing does nothing, has nothing, is nothing.
He may avoid suffering and sorrow, but he cannot learn, feel, change, grow, or live. Chained by his certitude he is a slave who has forfeited all freedom.
Only a person who risks is free.
-William Arthur Ward
Thursday, October 29, 2009
- whether to take personal advantage of a “corporate opportunity”
- responding to a fire that destroys your manufacturing operations
- handling a strike over labor contracts at a newly acquired plant
- managing environmental, community, government, and human rights issues
- how to reward top management for closing a proposed merger
- responding to a low-ball hostile takeover bid
- dealing with a potentially serious health risk in a major product line
- responding to a serious global health crisis
- formulating an investment strategy that advances sustainable development
- preventing organizational drift and creating an effective governance system
- deciding on executive pay and responding to activist investors
- dealing with illegality and fostering organizational compliance
- whether to accept a “politically connected” candidate into an internship program (List courtesy Professor Lynne Paine.)
Wednesday, October 28, 2009
As we wind our coursework down this week, we were invited to watch this Youtube video. Several classmates found it inspiring. If you have an extra 15 minutes to burn, you might want to watch it.
His advice? "Stay Hungry, Stay Foolish".
What do you think? Comments?