Rework from 37signals

Rework is the recent page turner by Jason Fried and David Heinemeier Hansson, the co-founders of 37signals. The book is 288 pages, but every other page is either a drawing (not a diagram, a drawing) or a blank page. This made the book read exceptionally fast. Check out the excerpts or the trailers.

My initial reaction to the book was positive. I am a fan of their other book, Getting Real, a series of essays on software development. Rework had a much more broad appeal than Getting Real. It is 37signals’ fresh take on business and their unique philosophy on starting, running and growing businesses.

I respect the fact that the authors take an opinion in the book. I did not agree with everything in the book, but having an opinion and offering evidence to why that opinion is right is something to be applauded. Initially, I was taken aback by their approach, but have grown to like their upfront style of writing.

One of passages from the book that I enjoyed was their explanation of the real world. People immediately assume that new ideas will never succeed in the real world. Things like scalability and user adoption are common arguments to why the real world will crush your dream. Rework makes the counter argument that you don’t have to live in the real world. The real world problems are just that, problems. Waiting for solutions.

The book is full of interesting observations. Like the prison weapon approach, where prisoners are able to craft weapons out of virtually nothing. Just like taking an idea and turning it into a business out of thin air. Another idea in the book is Hero Mode, where an employee grinds on a task for hours until they reach hero mode and solve the problem. Everyone is guilty of overdoing a task. Most of the time, that 4 hour task can be solved in 20 minutes with outside input or taking a different approach.

Definitley read the book. It will only take a few hours, and they will be very thought provoking. I read the book as a result of a book sharing idea from this blog’s really cool post. Check them out.

Why Walmart is the only place that will recycle plastic bags

Since moving into our house last year, we have always had some sort of recycling strategy. We recycle the most common items, like cans and bottles. One thing that we always have around are plastic grocery sacks. These are unavoidable, and can quickly pile up if you don't use reusable mesh grocery bags.

Trying to recycle these sacks is tricky, because normal recycling centers do not accept them. Recently, I have noticed that Walmart does accept plastic bags for recycling. As far as I know, that is the only item that Walmart accepts for recycling (tires and automotive batteries maybe, but that is a given).

When I went into the store earlier this evening, I found it odd that they prominently displayed the crate to recycle plastic bags. Why would they accept only plastic bags? Why not cans and plastic bottles? I formulated the following theory about why they accept plastic bags for recycling while waiting 15 minutes as the cashier rang me up. It might not seem like a long time, but he started at 10:40 pm and I left the store at five til 11.

Walmart accepts plastic bags for recycling because that is the only realistic option for them to sack groceries. Walmart check lanes are operated by one cashier and no baggers. That means that a cashier checking out a cartload of groceries needs to sack all of them. It is only efficient when using plastic sacks on the turntable. Give the cashier a bag of mesh sacks and prepare to wait.

This begs the question - why would Walmart allow people to bring their own grocery sacks? It takes the cashier nearly triple the amount of time to sack groceries in reusable sacks. They are making more work for the customer by strongly encouraging the use of plastic sacks, hoping that the customer will remember to bring them back.

When given that much time to reflect, it is easy to come up with an explanation of why things are the way they are. It is loads cheaper to have cashiers sack groceries, so Walmart has made it incredibly efficient for the use of one process (using plastic bags) and nearly impossible for another process (bringing reusable mesh bags).

Changes Going Against the Grain

I recently heard Ed Brill (yes, the Ed Brill) speak about enterprise social networking. Overall the talk was very well done. Ed did a really good job of detecting the audience's understanding of the topic. Since everybody that attended the talk was educated on the subject, he could skip over some background content, which I appreciated.

The focus of Ed's talk detailed corporations use of blogs and social networking to their advantage. He brought up some good general guidelines about corporate blogging. Instead of having product blogs, companies should have individual blogs about products. This gives blog posts a more personal voice, which makes it easier for other people to connect to the blog. Also, companies should establish a blogging standard (Ed mentioned IBM's) for employees to follow. This is an extension of the companies corporate policy, and it helps to establish a standard of quality among corporate bloggers.

One part of Ed's talk was of particular interest to me. Popular, High visibility products/services typically have a strong online community that supports the product. High-traffic sites like Facebook fall into this category. Everyone is on Facebook, and the average user is there frequently (Facebook has a great statistics page). Users love Facebook, but there is chaos whenever Facebook tries to make a change. I asked Ed for input - how are "against the grain" changes are made? Because if it is working, why would it need to be changed?


Ed responded with by saying that the product/service has to be worth defending to make significant changes. Since Facebook is a great service, it is worth the extra effort in defending it when it is changed. Ed went on to say that changes should be made public before they happen, and that users should be aware of upcoming changes. Ed also mentioned that customer reviews carried more weight than any other statistic - so power users of the product/service should support the change before it happens.

Facebook is definitely worth defending, so it is continuously improved. Most of the time, its users are accepting of system changes, but there will always be demands to bring the old Facebook back.

When a product/service is high visibility, there will be more opponents of changing the it for the better. There is reduced risk when things stay the same because of the critical mass of users. But with this reduced risk, there is missed opportunity. High visibility products/services should still have the ability to adapt - even when users are satisfied with staying the same.

YouTube Costs How Much?

Google acquired YouTube in November of 2006, for around $1.65 billion. It has operated as a subsidiary since then, but they have not been the breadwinner. According to Business Insider, YouTube is predicted to bring in $240 million in ad revenue in 2009 - not bad for a company that is 4 years old. But when that is weighed against their projected $711 million operating costs, YouTube is predicted to lose Google nearly $500 million this year. "A bitter pill to swallow," the article states.

YouTube began running ads with their videos to generate revenue, but they cannot charge enough per CPM(Cost per thousand impressions) because no one wants to watch the videos people put on YouTube. The article goes on to say that YouTube will continue to grow in 2009, but the amount of user generated (less appealing) content will continue to exceed the premium (worthwhile to advertise) content.



Hulu, YouTube's network-backed younger brother, got he online advertising right by providing users with content that they want to see. The number of unique visitors to Hulu pales in comparison to YouTube (6 Million vs. 86 Million). Hulu is projected to make $120 million in ad revenue this year, about half as much as YouTube. These are difficult predictions to make, but Hulu is much more efficient in generating revenue.

Why would Google continue the YouTube experiment? It's costing them around $1.4 million per day to run the site. Google cannot pull the plug on YouTube, but the Business Insider article did mention a few alternatives to monetize like subscriptions and premium content. Those would be great but they would change the YouTube community.

I would propose to shut down YouTube for one day per week - "On the Seventh Day, YouTube rested." Google could keep some of the money that the site loses everyday. Or they could donate it - which they love doing.

Experiment time: If the site were shut down for a day (I know you can't just pull the plug), then you could theoretically:

• Pay for 100 years of college at UNL,
• Buy 40,000 50 Kg bags of rice in Africa,
• Build 28 schools in Afghanistan or Pakistan,
• Build 28 community parks.

YouTube is not going anywhere, and Google will improve its profitability, but it is interesting to think of what a day without YouTube could buy.