Archive for November 16th, 2009

Doing OK … except on the economy, Afghanistan, the deficit and, oh yeah, healthcare.

November 16, 2009

Bottom line: Rasmussen & Schoen say that unless Obama changes his approach and starts governing in a more fiscally conservative, bipartisan manner, the independents that provided his margin of victory in 2008 and gave the Democrats control of Congress will likely swing back to the Republicans, putting Democratic control of Congress in real jeopardy.

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Excerpted from WSJ: Obama Is Losing Independent Voters, Rasmussen & Schoen, Nov. 14, 2009

Obama’s approval among likely voters has dropped to the low-50s in most polls, and the most recent Rasmussen Reports poll of likely voters shows him slightly below the 50% mark. This is a relatively low rating for new presidents.

A CNN poll released Nov. 6 found that 47% of Americans believe the top issue facing the country is the economy, while only 17% say its health care. However, the bulk of the president’s efforts over the past six months have been not on the economy but on health care, an issue in which he continues to draw negative ratings.

In a Rasmussen Reports poll taken after the House of Representatives passed health-care reform by the narrowest of margins last Saturday night, 54% of likely voters say they are opposed to the Pelosi plan with only 45% in favor …   58% of unaffiliated voters,oppose the bill.

The CNN poll also shows that in addition to health care, a majority of Americans disapprove of how Mr. Obama is handling the economy, Afghanistan, Iraq, unemployment, illegal immigration and the federal budget deficit. Put simply, there isn’t a critical problem facing the country on which the president has positive ratings.

An NBC/Wall Street Journal poll conducted from Oct. 22-25 found that the president’s personal ratings have suffered a similar decline. His rating for being honest and straightforward has fallen eight points from January to 33% and his rating for being firm and decisive has fallen 10 points to 27%.

Even more fundamentally, a Washington Post/ABC News poll conducted from Oct. 15-18 shows that the president has now reached a point where less than a majority of Americans believe he will make the right decisions for the country.

A Rasmussen Reports poll released Oct. 26 shows that only one-third of likely voters believe the stimulus package has helped the economy.

This week’s Rasmussen Reports poll shows  49% of respondents blame Mr. Bush for the economy and 45% blame Mr. Obama. By the beginning of next year, the problems of America will be Mr. Obama’s problems, and references to his predecessor will increasingly fall on deaf ears.

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Deficit reduction and reining in spending are critically important priorities for the vast majority of the electorate. Indeed, according to a Rasmussen Reports Poll conducted at the end of last month, voters say deficit reduction is most important and health care is a distant second.

Obama has found himself in a false and arguably artificial conundrum on health care, with the two alternatives being his bill with a public option and a trillion-dollar price tag, or no bill at all. While the failure to pass a health-care bill could be devastating for his administration, polling suggests that ramming through an expensive bill with a public option (potentially using procedural techniques in the Senate) could divide America and not improve his standing with the public.

Voters would like to see compromises on key elements of health care to reduce costs, while the Democrats’ plan has appeared to focus largely on expanding coverage.

There is a clear, bipartisan majority who favor a less costly bill that incrementally increases coverage, provides insurance reform involving pre-existing conditions, and experiments with tort reform and competition across state lines.

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Full article:
http://online.wsj.com/article/SB10001424052748704402404574525543109875438.html?mod=djemEditorialPage

About your bold strategic move … will your competitors even notice?

November 16, 2009

TakeAway: How to assess a competitor’s response to your strategic moves?  Game theory is often too complex and too assuming to fit the real world.  Intuitive-based war gaming is often skewed by personal biases and hidden agendas.

So, McKinsey proposes a practical approach to predicting competitive behavior that “stays close to the theoretical rigor and accuracy of game theory but is as easy to apply.

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Excerpted from HBR: Predicting Your Competitor’s Reaction, by Coyne and Horn, April 2009

The McKinsey approach involves distilling all possible analyses of a rival’s response to a particular strategic move into a sequential
consideration of three questions:

  1. Will the competitor react at all?
  2. What options will the competitor actively consider?
  3. Which option will the competitor most likely choose?

The first step in analyzing competitor reaction, therefore, is to address the likelihood of no reaction.

To determine this, you must ask four subquestions. If the answer to any of them is no, the chances of a response are low.

1. Will your rival see your actions?
Even if an action appears obvious to you, your competitor may not recognize it.

First, most companies rely on incomplete data to assess changes in the marketplace, e.g. market research that only survey certain segments, markets, or channels.

Second, if your strategic move will affect several of your competitor’s business units, it may not register as significant to any one unit and so may be
overlooked.

2. Will the competitor feel threatened?
Even if your competitor sees your actions, he may not feel threatened—and, accordingly, will not think that mounting a response is
worth the expense and distraction.

That is, the competitor may not consider the strategic move to be statistically significant to their in place plan.

3. Will mounting a response be a priority?
Your adversary probably already has a full agenda before you make a move. On it are product launches, marketing campaigns, reorganizations,
major acquisitions, plant openings, and cost reduction efforts—some or all of which must be curtailed in order to react to your move.

Therefore, to the degree that your adversary has already committed to plans that will fully occupy his attention, he will be reluctant to shift priorities.

4. Can your rival overcome organizational inertia?
Even if top management wants to react, the organization as a whole may resist.

First, if reacting requires the company to make major organizational changes, it is very unlikely to do so unless the threat is immediate and deadly.

Second, managers are generally reluctant to abandon their success formula, and if they decide to go ahead and make a change, they are very poor at doing so.

Third, companies have great difficulty mounting a response that requires the cooperation of third parties, which may not share their sense of urgency.

For example:

In the late 1980s, a small U.S. pizza delivery chain called Papa John’s noticed a change in consumers’ perception of the quality of Pizza Hut and Domino’s (the top two chains) and used the opportunity to create a differentiated value proposition captured in the slogan, “Better ingredients. Better pizza.”

Papa John’s expanded rapidly throughout the 1990s and became the third largest pizza chain in the country, while the two bigger rivals stagnated.

Unable to mobilize their franchises around quality until the threat became undeniable, the big chains did not respond with better pizzas of their own until 2000.

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Punch line: Competitors do not respond to their rivals’ moves at least 1/3 of the time.

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Upcoming: What if your competitor does respond ?

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To sell more books … lose the index … huh ?

November 16, 2009

Bottom line: Self-obsessed Beltway politicos have (another) beef with Sarah Palin’s book “Going Rogue.”

Excerpted from WSJ: Once a Rogue, Always a Rogue, Nov.  13, 2009

Political types in Washington make a show of turning up their noses at actually buying and reading books such as “Going Rogue.”

But familiar faces can regularly be spotted in store aisles anyway scanning for their names in the index.

Sarah Palin’s book won’t have an index, denying Beltway habitués the instant gratification of knowing whether they are included.

Instead, political and media types who want to know if they figure in accounts of her conflicts with the McCain campaign or with major news media personalities such as Katie Couric will actually have to buy the book and at least skim it.

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Publishing a political book without an index was pioneered a dozen years ago by John Brady, author of “Bad Boy: The Life and Politics of Lee Atwater,” a biography of the controversial master of negative campaigning who advised the first President Bush’s 1988 election bid.

Mr. Brady’s intent was to boost sales.

For scholars and other serious readers he offered a copy of the index to anyone who sent him a stamped, self-addressed envelope.

His ploy worked exactly as intended …  some people reportedly  bought the book just to see if they were mentioned  in it..

Full article:
http://online.wsj.com/article/SB10001424052748703683804574533840931957188.html?mod=djemEditorialPage