Category: Economics

Categories
Economics Engineering Life

Closeout Deals From The Industrial Past

This past weekend I stopped into HGR, the local industrial surplus company in Northeast Cleveland. This place has industrial equipment from all over Ohio, unfortunately from plants closing down. Check out the pictures of all the machinery for sale…it’s enough to build one HELL of a workshop (and even a great new workbench!).

 


This Place is Monstrous


OK, I really would love a robot


The Roof Could Use Some Work


Reflow Oven For Sale (You Transport)


Because honestly, you never know when a machinist might want to get some exercise


A Heidelberg Printing Press

Categories
Economics Engineering Interview

A Talk With An Electronics Industry Analyst

I recently had the opportunity to ask some questions to Mike Demler, electronics analyst and writer at The World Is Analog. He has many years of industry experience, culminating by recently joining DIGDIA, a strategic consulting service that helps with market analysis and business planning. Let’s see what he had to say:

Chris Gammell: Can you please explain your background?

Mike Demler: Explaining it may not be that easy, but I’ll give it a try.

I grew up in the city of Buffalo at the peak of the U.S. space program, and had an early interest in science. My parents nurtured that a lot, and my Dad always had some TV parts around from his part-time repair business. Those were the influences on my decision to study electronics in high school, and then as an EE student at the University of Buffalo.

In the summer after my junior year, I vividly remember reading the book “Analog Integrated Circuit Design” by Alan Grebene. It’s probably more accurate to say I tried to read it, as I know I didn’t comprehend it all so I kept borrowing it from our public library. I very much wish that I had a copy today. I was fascinated by the combination of electronics and physics involved in actually being able to create something in silicon, and that’s when I decided what I wanted to do… I wanted to design integrated circuits.

It wasn’t easy, as UB was about as far as you could get from silicon valley both geographically and academically, but through lots of luck, some independent study, the help of our department chairman and being in the right place at the right time… I got my first job as a Product Engineer for Texas Instruments in Lubbock, TX. That was my launching pad. Someone once told me that ‘TI’ stood for Training Institute, and it certainly was for me. I completed an MSEE at SMU after moving to Dallas, then went back to NY and the GE R&D Labs. We developed some very advanced (for the time) analog technology there, and my TI experience prompted me to move on to GE-Datel where I commercialized the semiconductor process and led development of a new ADC product line. After GE once again exited semiconductors, I took on a similar role starting the semiconductor product line at Unitrode-Micro Networks. I was working there when I wrote the book “High-Speed Analog-to-Digital Conversion”.

Starting up new product lines led me from engineering to sales, marketing and business development. It was during the dot-com startup/IPO boom, and I moved into EDA at that point. I worked for small pre-IPO companies like Meta-Software, then did a startup in Antrim Design Systems that moved me to California. I have also worked for Cadence and Synopsys, and completed an MBA a few years ago. Now I work as an industry analyst, focusing on new disruptive technologies in mobile wireless.

CG: How does your experience in the EDA industry and the semiconductor industry affect your work now?

MD: I’d say that it gives me a unique perspective on the role of those components in the broader electronics ecosystems, such as the wireless industry. When I was in EDA I worked for a while on vertical market strategies. Though they wish it was otherwise, EDA is a small component in a much bigger picture, and most design tools are not easily differentiated by end-market application. Now I get to have the higher-level view of where the customers of the customers are going, and I try to provide insight on how it all fits together both top-down and bottom-up.

CG: What kind of companies do you interact with as an analyst?

MD: I mostly focus on the wireless industry, and currently I am working on an analysis of the Android ecosystem. The variety of companies is almost endless, especially since I try to provide that unique point-of-view from chips to consumer electronics, to services and applications, networks, etc. There are big companies like Cisco, Intel, Qualcomm, Motorola, HTC, LG, Verizon, AT&T…. the list goes on… to numerous small companies, some that are behind the scenes that you are unlikely to hear of unless you are in the industry.

CG: How soon before a product comes out do you get to hear about it?

MD: I don’t get that much special advanced notice of future products, but I think that one of the values I provide is that because of all the sources of information I have, I can tell where things are going ahead of time. Companies sometimes provide advanced information under NDA, that could be from one quarter to a year before you see it in a product. You can also learn what sources of “unofficial” information to trust. The most pointless advanced information I get is when a PR rep send me an unsolicited press release “under embargo” before a major trade show or conference. I haven’t seen one of those yet that was a big deal.

CG: What kind of impact can your work have on the industry? Are there consequences to being right or wrong about your industry predictions?

MD: I wouldn’t presume that I influence the industry in general, but I can have an impact on individual companies that use my research and insight. I stay away from far out predictions, and you won’t see any press releases from me that say “DIGDIA forecasts X million users of Y in 2014”, that you see every day from other analyst firms. Those forecasts are vaporware designed to get repeated on the internet. If I am right about trends and I point out important factors in one of my strategic analyses it improves my credibility. If I am wrong, then not.

CG: Your blog is called “The World is Analog”. How do you view the role of analog in devices today and what role do you think they’ll have tomorrow?

MD: My point of view in “The World is Analog “ goes back to my answer to your first question. At the risk of being seen as a technology bigot, everything is in reality analog. That is not to say that I don’t appreciate the aspects of design that are digital, or computer science in general, etc. but nothing works unless you build it, and all devices are governed by the (analog) laws of physics. Digital is just an abstraction of the underlying analog behavior. Those analog physical aspects of a design are becoming increasingly difficult to ignore even in digital design; factors such as dynamic voltage variation, power management, statistical process variation, etc. On the other hand, analog circuit functions are enhanced by digital controls, and that inter-dependence will continue to grow going forward.

CG: What do you see as the future for electronics? What kind of devices will people own in 5, 10, 20 years from now?

MD: Electronics will continue to grow and enhance so many aspects of life. The 5-year horizon is what I am focusing on, which will be dominated by ubiquitous wireless connectivity to the internet. This is going well beyond smartphones–to other areas of consumer electronics, energy management, home security, and health and medicine. Those describe some of the broad categories of devices people will “own”. I also see bioelectronics, I suppose you can call it call it bionics, as one of the big growth areas. Today we have devices like pacemakers that help to control heart function, but imagine how nano-electronics and smart wireless sensors can be used to monitor and control other body functions. Transportation is another area where we are just beginning to see what embedded electronics can do. I think the cars that can automatically parallel park are amazing, but people seem to take an advance like that for granted. We will see more “connected vehicles”, with real time 4G wireless connections for information, traffic control and numerous other functions.

CG: It seems that you have transitioned to the business side of things from your early days in engineering. How do you interact now with managers, engineers, marketers and others in the electronics world?

MD: Well, I’ve been in all of those roles, so hopefully it helps me to better understand where people are coming from when I interact with them.

CG: Where do you view the industry itself going? Will all electronics end up in Asia? Will things ever move back towards the US?

MD: There is no “moving back”. It’s like Thomas Friedman wrote in “The World is Flat”; manufacturing will always go to the lowest cost location. Everyone needs to take a global view in every industry today.

My greatest concern is education. By growing up during the Apollo space program, I benefited from a societal focus on developing advanced technology. The U.S. needs to work harder to develop more scientists and engineers amongst our own citizens. I hope that environmental concerns might stimulate the current generation of students in a similar way, but I can’t say I’m optimistic at this point.

CG: Is there a maximum growth potential for the market? Won’t people stop needing devices? What happens then?

MD: No, the market for electronics devices will grow many times over where it is today. I don’t limit that statement to mean only consumer electronics devices. We can only carry or interact with so many. But the connected world is only beginning to be developed; for in-body, in-home, in-vehicle, in the environment.. the list is endless.

Many thanks to Mike for taking the time to explain his view on the (apparently analog) world. As you may have noticed from other posts on here about talking to various professions, I’m very curious about the electronics ecosystem.  I find it fascinating how different job functions look at similar situations, especially when those people are selling or buying products from one another. The customer in one scenario often turns around and becomes a supplier to someone else. The interdependencies are intriguing. You may also notice that I have been targeting people that write for their own sites or for their companies sites. While I intend to focus on the less well-known positions eventually, why not show off the great content they have already written on outside sites? Be sure to click through to their relevant posts from the links above.

Two questions:

  1. Do you (the reader) enjoy seeing these perspectives? I know I always appreciate the freshness that other perspectives add to this site, but am not sure that others feel the same.
  2. Do you have any questions for Mike specifically? These can be questions about the future of the industry (though I thought he gave some good explanations on the direction) or his past experiences or really anything!

Please leave your notes or questions in the comments area!

Categories
Economics Life Politics Supply Chain Sustainability

Is There Room For The Electronics Industry In A Sustainable World?

Even though I’ve stated that I’m not as interested in sustainability as I used to be, it doesn’t mean I don’t think about it. I have been thinking about it in conjunction with investing and my own work in the electronic industry.

Growth is a very important component to the electronics business. It’s priced into many stocks and it drives much of the electronics food chain. Moore’s law has helped for a long time too. Shrinking the geometry of silicon every 18 months really required manufacturers to update their equipment often. This then drives the equipment manufacturers to advance technology to make the new fabrication possible. The analog engineers (ok, digital too) out there utilize the new chips and make requests for the next generation. The ripple effect continues all the way down the line, requiring input from the manfacturers and returning revenue to the shareholders of said manufacturers. Like I said, this growth is an assumption and is priced into how people invest in companies involved in electronics manufacturing.

There’s no denying that electronics are a dirty business. Not oil-gushing-from-a-hole-in-the-ocean dirty, but still, not exactly the most environmentally friendly situation either. The chemicals used in semiconductor manufacturing are not known for their safety nor their easy disposal; I’ve only had training on how bad they can mess people up but it goes beyond that; there are entire departments in semiconductor manufacturing facilities devoted to containing and disposing of the chemicals. Outside of the semiconductor world manufacturers have had to drastically reduce the amount of lead in products (in the solder and otherwise) but there are still elements of boards and parts that are not good for the environment. And given both the amount of turnover in the products that people consume year to year and the fact that very few products are designed for long term use, almost all electronics are bound for a landfill within a 10 year time frame (unless recycled). All of this adds up to a nasty picture for the planet.

A business built on growth and components that are not biodegradable nor regulated in their disposal. Is this model sustainable? Can manufacturers continue making products that are not safe for disposal and yet expect people to continuously update their personal electronic portfolio at home? Can manufacturers continue to crank out new devices ad nauseum and not be held responsible for the impact they make?

I do not believe the long term growth of electronics will plateau. While this may be good for my own career, part of me is very conflicted by the idea that my own success could be tied to the fact that we will have to consume more and more over time. Growth will always be driven by the next “must have device”, updating of previous generation devices and bringing electronics to a greater percentage of the population. But how can we rectify the needs (or perceived needs as it may be) with the very real issues and impacts associated with modern electronics? The material and energy inputs required and the waste from technology churn all make for hundreds of miles worth of disposed and forgotten cellphones and CRT monitors which took large amounts of the earth’s resources to make.

So assuming that growth of the electronics industry will continue unabated for various reasons, I think the question is better asked: Is a sustainable world possible with the electronics industry as we know it today?

I don’t usually say it on this site, but I have no clue about the answer to this question. Do you? Is it possible for there to be a healthy electronics industry when taking the planet into account? How does this affect the business model and should the people that manufacture products be responsible for what happens to the at the end of the products’ lifetime? Please let us know in the comments.

Categories
Economics Life Renewable Energy

I Have A Million Dollar Idea For Free Energy!

Ha, my title sounds like the beginning of a spam email. I’m actually even willing to have at least one FeedBlitz email that gets sent out to be caught in a spam filter, just to prove my point.

Either way, the title of this post looks ridiculous. And yet it is pervasive in headlines on the internet and in newsprint. Why? Because people are hungry for new ideas, new ways to try and make money and free energy (I guess those could all be classified under the money category). The reason these headlines are everywhere is because they work. They grab peoples’ attention, including my own.

But wait.

There are no breakthroughs, right?. There are, but they’re much more rare than the public is lead to believe. Even those breakthroughs aren’t even that big of a leap from the previous discovery. That’s just not how science works, people. Science is iterative. Science is boring. That’s the way science is designed to be. You think up a hypothesis, you test it, you repeat based on those results. Even if you do have some huge breakthrough, you really need to test it out rigorously to determine if it truly is a breakthrough.

Because of this realization, I’ve decided to create a simple guideline for the news media (who will ignore it, even if they ever saw it) and for aspiring pseudo-scientists, who are probably just people trying to sell the first “technology” they get their hands on.

Step 1: Ask yourself, “Has this been done before?”

I’m guessing that yes, you have asked yourself this; and no, it has not been done before. Why else would you be trying to report on it and/or sell it to people? If this has been done before, go back to the drawing board. No one wants to hear from you. (See, this is like science!)

Step 2: If this hasn’t been done before (and this technology you’re investigating seems like a breakthrough), ask yourself, “WHY hasn’t this been done before?”

This is the step that people miss. Either when reporting on a technology or worse, trying to “create” a new technology, they ignore this step. For example, say you’ve figured out that you might be able to harness the motion of trees blowing in the wind. OK, why isn’t anyone doing it now? Have you considered the efficiency of the conversion process? Have you considered the economics of trying to harvest this energy? How long will the payback be for people that purchase such a system?

Step 3: If you believe you’ve overcome the 3 of the stumbling blocks of discovering new energy technologies (efficiency, money, ROI), what has changed?

Be specific. Saying that “it’s never been done before!” will be considered an incomplete answer and you will fail the test. If you are a reporter doing a story on an energy technology that will eventually be the next big thing, say exactly what has to happen and how soon it would have to happen in order for that technology to become viable. If you are “developing” that next big thing, tell us what you overcame and possibly how you overcame it; in the event you are not allowed to divulge that info because it is a trade secret, be prepared for future scrutiny and skepticism. Shrouding a problem does not solve it.

Step 4: Determine: Are you (or the people you’re reporting on) capable of delivering on a consistent basis all of the things that are promised?

Here are some examples of news stories or “inventions” I have heard about but that did not deliver:

  • A new chemical compound that can burn hotter and longer than fuel sources currently used but is extremely expensive to make (process). Since it was sold as a disruptive technology, this could not deliver because disruptive technologies must be economically feasible.
  • A new processing technique that is based upon ideal lab conditions and low volume manufacturing. Data was not based on a large sample size with many permutations of input variables so the promised (laboratory) conditions could not be delivered.
  • A microenergy harvester that was not capable of delivering because the efficiency of the converter was not calculated with realistin inputs and operating conditions. As such, the advertised output power could not be achieved.
  • A device based on permanent magnets that requires less energy put in than can be recovered. NOTE: This can never deliver as promised, see laws of conservation of energy and thermodynamics.

I’m not trying to say that people shouldn’t attempt to develop new technologies nor should they only do research on things that are immediately economically viable. That is short sighted and many past inventions would have never been achieved with that mindset. The people I’m reaching out to are the so called “reporters” out there and the so called “inventors”. Basically what I’m saying is that I too am hungry to hear about the next big thing. I look often and I find the same story each time. There was either a miscalculation or a misquote or a fancy-pants marketer trying to sell his big dumb ultra-capacitor that no one has seen to this day (p.s. it’s 2010. We’re still waiting!).

I know I’ve been guilty of it too, getting overzealous about under-developed new technologies. I’m a far cry from mainstream media though and I’ve yet to start “Gammell Energy Industries” to sell a ghost product. So if you’re a reporter/marketer/inventor/whatever, please be gentle with my hope for technologies that will help solve problems in the world. When you lie about a new product or technologies’ capabilities, it only dashes the hopes of others and removes focus from solving the problem at hand.

Categories
Economics Learning Politics Work

Unorthodox City Development

Although I’ve been busy working on Electricio.us lately (thereby neglecting this site), I have been able to continue listening to my local NPR station (which, like any good nerd, I love). A program the other day spoke to a local community trying to build up the economy through the arts.

I was intrigued. I had never thought of that before. Why would anyone ever try to develop an arts community first? Where are the jobs? Well folks, we have a bona fide Chicken and Egg paradox here. It really goes both ways. What happens if a community only has day jobs and no culture? What happens if you develop a thriving arts community before there are “Economic Drivers” and jobs for people moving there?  Does the absence of one element slow the growth of the other?

I would tend to think the jobs come first. And of course when I think jobs I think of technical jobs, not those silly financial jobs that got us into this mess of a recession. I mostly think of technical jobs first because I’ve never really experienced anything else and I’ve heard technical jobs can have a multiplicative effect (helping to create some of the other jobs I’m not as fond of). But what happens in locations where there are only jobs and no culture to go along with it? Who really wants to live there?

An example is contained within Eric Weiner’s book, The Geography of Bliss (which I first read about at Get Rich Slowly). He is traveling the world, looking to explain why some locales are happier than others. In the midst of his travels, he goes to Qatar (one of the richest regions in the world) where he encounters a city booming with jobs (mostly for migrant workers) to fill the “need” of those rich from petrodollars. However, he notes the absence of culture and even references how the richest from that country travel the world buying up impressive art collections in a hope to obtain culture. The result is a city full of people being shuttled to and from chain restaurants and malls, without any interesting things in between. Even the history museum is filled with artifacts toil and struggle in the desert…and not much else. Because the jobs in the region are scarce, no one really wants to be there, but no one working there can really leave.

The other extreme is when a city has a strong art and culture community but is lacking in jobs. An example is New York City in the current recession. Even though the current unemployment numbers are hovering around 10.3%, people continue to move to the city. Why? Because you can’t find many other places in the world with a similar art and culture scene. Where else can you find so many museums in a 10 mile radius? But when it comes to being practical? No, not so much. The fact that the unemployment is only 10.3% is likely because of the high costs associated with living in or even near the city.

So back to the original example. Would starting an arts community allow for eventual development of a thriving economy? It depends. Are there other nearby communities that can feed into this new community? Are those other communities lacking in culture or interesting events of their own, thereby necessitating people in that community to travel? Are there people in the existing community that will be benefactors to the new community? And most importantly, are there people willing to move to and develop a new arts and culture based community?

If there is a willing population, both moving to and surrounding a new (or revitalized) community, then I believe it would be possible to use arts and culture to build up a local economy. I think that it is a non-standard way to draw young and artistic people into a new place and to centralize events and gatherings; this, in turn, could help to draw people that aren’t contributing to the art and cultural scene directly but want to experience and patronize it. I know that Cleveland, with excessive sprawl and thinly populated suburbs, could really benefit from a community such as this (really it will be supplementing many other creative and culturally rich regions). Although the travel required between regions is undesirable, I think creating an arts community can really help to bring people together, which is really what drives economic growth over the long term. Do I think there will ever be large corporations moving in and bringing thousands of jobs to this revitalized community? No, I don’t; but that’s not really the point anyway.

I’m interested to know if anyone has heard of other communities built first around cultural and artistic endeavors that later blossomed into vibrant communities. If you have ever heard of one or have an opinion about what they’re trying in Cleveland, please leave a note in the comments.

Categories
Analog Electronics Economics Politics Renewable Energy

Sustainable Cleveland 2019

I will be attending Sustainable Cleveland 2019 later this week. It has given me a renewed interest in renewable energy and has really been great motivation to learn more about my city.

The summit will be a gathering of more that 600 people from different walks of life in Cleveland, all trying to figure out what we need to do in order to become a leader in various fields of sustainability. The 2019 part of the title refers to the Cleveland 30 year from now, when all of the areas of sustainability will hopefully have been achieved. These sustainability initiatives could include:

  • Renewable energy production
  • Advanced energy (infrastructure)
  • Advance material fabrication and advanced manufacturing operations
  • Sustainable, local food sources
  • Green buildings (LEED certifications)
  • Stringent environmental policies, especially to protect our water source, Lake Erie
  • Sustainable Business Practices

So what can we do as a group of non-policy makers to actually drive any change in this city? A question I’m not completely sure of the answer. At the most basic level, I think this summit will give the citizens and drivers of change in the city a chance to tell the administration what they think. In fact, the entire summit is being hosted by the mayor, Frank Jackson, so I am guessing that’s exactly what he’s looking for. Beyond the basics, there is a methodology being implemented known as Appreciative Inquiry; I’m not into organizational behavior, but from what I’ve read it’s a popular method. The leading researcher in this field, David Cooperrider, will also be present at the summit to lead and guide us. I was surprised to later learn that Dr. Cooperrider is a sitting professor at my alma mater, Case Western Reserve University. From what I have learned about the method so far (which in all honesty seems a bit touchy-feely to me), it is about bringing people together while they are still excited about a prospective idea, instead of after problems have developed and that same group is only trying to fix the problem. It has proven successful for many groups thus far so I am eager to learn more about it.

Although this was the first time they decided to host such a summit, the organizers required an application for entry, to ensure people who were signing up were serious about their pledge to attend (the summit requires a 3 day commitment). I thought including some excerpts of my application would help illustrate why I think attending a summit like this is important (Warning: I was very interested in attending, so I felt it necessary to toot my own horn a bit. You’ve been warned) :

Describe what draws you to this summit.

I understand that a 10 year plan is only as good as the people that are writing and later following it. I want to be an integral part of the planning progress so I can help shape a future city that is sustainable and one that I can continue to be proud of. I am interested in meeting others that are passionate about moving Cleveland  towards a future that is sustainable, successful and forward-looking. The people at this summit will be the leaders of the next phase of Cleveland’s evolution and I would like to start working with them as soon as possible.

What unique aspects will you bring to the summit (education, life experience, etc.)?

I currently write a blog that discusses electrical engineering and renewable energy. I write on topics relating to my profession (analog electrical engineering), my generation (Gen Y) and I tie it into content about emerging renewable technologies. I also have a unique perspective, being a student that left the area for a job after college, thereby contributing to the “brain drain” that has affected much of Cleveland; I have since been one of the few that has returned (in 2008) so that I could help contribute to the city and pursue my passion at a company that is a leader in the measurement industry. My work at Keithley Instruments has given me insight into the needs of renewable energy producers and allowed me to work with some of the finest engineering minds in Cleveland.

I feel that I bring a fresh perspective on the technological aspect of building a sustainable Cleveland. As someone who works in an industry that serves renewable energy and as someone who aspires to work more directly in the renewable energy sector, I feel that I can help define where Cleveland will be able to best capitalize on new technologies and strong business opportunities. These will drive the future growth of Cleveland as both an economic hub and as a model for hosting sustainable and eco-conscious companies.

What do you think are Cleveland’s biggest strengths or best assets?

I believe that the students graduating from local Universities will be the foundation upon which the next phase of Cleveland will be built. Enticing them to stay in Cleveland and encouraging them to create new companies will generate revenue and jobs in Cleveland. The technology and companies that are created will drive local development and help bring in more residents and investment. Furthermore, I believe the Universities that are producing these students are an asset and that they should be assisted in post-graduate retention and building businesses out of commercialized research efforts.

A second more obvious but yet untapped resource is Lake Erie. In terms of energy, I believe Lake Erie can produce a great deal of clean and sustainable power for residents in Cleveland and surrounding areas. From a sustainability perspective, the availability of fresh water must be considered and protected, as this will become an increasingly scarce resource as the world warms. Additionally, the wildlife and food sources the lake provides must be taken into consideration when planning for a more sustainable city and region.

What do you envision for Cleveland in the year 2019?

I envision a vibrant job market based on renewable energy companies that have sprung up over the past 10 years. More importantly, I see educational and research hotbeds such as Case Western Reserve being used as a launch point for multiple new industries and technologies. I see renewable energies being harvested from Lake Erie in the form of wind turbines and wave harvesting. I see axillary industries such as test & measurements adding even more to local economies and highlighting what Cleveland has to offer the world. I see tight-knit communities encouraging conservation and recycling and teaching these concepts in schools. I see programs in place to help every city have affordable recycling. I imagine local and regional governments encouraging restructuring and consolidating existing infrastructure as opposed to creating new sprawl. I see those same governments encouraging outside investment in the newly reconstructed and consolidated areas and in the new companies that have helped revitalize it . And hopefully, I see my own renewable energy company creating products that change the way we consume energy or how we cleanly produce it for use in energy efficient devices.

I feel that if nothing else, I will get the opportunity to meet others interested in sustainability and renewable energy in Cleveland. That alone could provide a great foundation for forming companies and coalitions later to help advance the city towards a sustainable future. On the other hand, I am hopeful that our work using Appreciative Inquiry will help lay a groundwork for where the city needs to go and what we need to do as a community to achieve our goals. I know there will be many planned follow up activities and I plan on discussing them more on here later. I would hope that my albeit limited audience might help to publicize the actions the city will take in the future.

Are you attending the Sustainable Cleveland 2019 summit? If you are, please let me know! If not but you have ideas that you think I should try to talk about while I am there, please let me know in the comments. I am interested to share what ideas I already have and if I can bring more voices than my own to the summit, I think it could be beneficial for everyone.

http://en.wikipedia.org/wiki/Lake_Erie
Categories
Economics Engineering Life Supply Chain

Are Engineers Naturally Cheapskates?

In a down economy, there is always focus on low cost. Job cutting, project re-definition, scaling back expenses, finding new sources of parts, all of these actions can lead to lower costs and help businesses stay alive in crappy economic climates. I think that the average (electrical) engineer can’t but help to let this mentality creep into other parts of their lives. In fact, I think the best engineers enter the profession and excel with this mindset. This revelation about engineering penny pinchers may have been stumbled upon by myself after being accused of being overly-thrifty a time or two. I don’t mind it though; I think maintaining a mindset of low cost is good for my work life and my personal life.

I have been on my own personal finance journey ever since I bought a house in the middle of a recession. I have been a regular reader of Get Rich Slowly, a fantastic blog about personal money issues, getting out of debt, smart money planning and tips on living a simple and frugal life. One of my favorite books suggested by JD has been The Ultimate Cheapskate’s Road Map to True Riches. It is full of interesting ideas to save money in non-traditional areas and generally living a simple and fulfilling life. If you’ve never read it, I highly suggest it. I also suggest to my engineering friends out there to consider how you can refocus your engineering efforts to match these principles. In his writing Jeff Yeager lists “6 golden rules for ruling your gold”, but I think they have everyday practical implications in engineering. Here is how I translate them for a thrifty engineer:

  1. Live within your means at thirty, and stay there. — I translate this idea as staying on budget for a project. A simple idea but many projects fail to do so. However, this also assumes you have a realistic budget in the first place. Allotting $10 for test equipment when you don’t have any and you plan to work on high speed signals is not a realistic way to start a project.
  2. Never underestimate the power of not spending. — Again, this is my translation but I would say this would be to cut out extraneous costs in a project. True, this sounds a bit scrooge-like, but I feel if I was bootstrapping my own company, this would be the only way I would operate. Ten years down the road you will remember the feeling of accomplishing your goal of releasing a product more than you will remember the t-shirt and mug you got commemorating it.
  3. Discretion is the better part of shopping. — I’ll speak more on this later, but the idea is to understand when you are buying a valuable product or service and when you are just being “sold” on something. It also means you have to understand the intricacies of what you are buying. From an analog engineering perspective, I think of this as buying a switching converter or something similar. Sure, you know you need to change the voltage supplied to a part of a circuit, but unless you know why you do or don’t need the latest and greatest buck converter, you might end up paying too much (for something you won’t necessarily need…could a linear regulator do the trick?).
  4. Do for yourself what you could have others do for you. — Design services are available for just about any task in engineering.If you were desperate enough, you could farm out every task in a project to a separate engineering firm that would piecemeal put together your project for you (READ: outsourcing). While it’s nice to use this service every once in a while to help speed up a portion of a project you are not an expert with, the time it takes to learn what has been done for you will often outstrip the time you save. Then if something breaks later no one knows how to fix it and you must pay the same design firm to help you again.
  5. Anyone can negotiate anything. — This is my favorite of the six golden rules and the one I have been taking most seriously lately. My attitude has been, “What is the downside to asking for a discount from a vendor?” If you are the customer, the most they will tell you is that they cannot swing any discount; at that point I thank them for their time and tell them I will get back to them after talking to some competitors. In a recession, people are eager to make a sale and are willing to lose some of their margin to do so. Don’t think of it as costing them money, think of it as gracing them with your business in a down time.
  6. Pinch the dollars, and the pennies will pinch themselves. — Paying $0.10 more per resistor when you are only buying 100 may have huge dividends. It could reduce the error in a circuit by orders of magnitudes. This is a small expense. Paying $100,000 for an oscilloscope that can measure 80 GHz when you really only need 10 GHz (still a little too RF-y for my tastes) could save you a significant amount of money and raise your overall margin for a product. Making money decisions based on need instead of “ooo-look-at-this-ery” can help project teams, companies and individuals have more rewarding payoffs at the end of a project.

Adding to the cheapskate stew and something briefly mentioned in point 3 above is discretion when buying a new product. I believe engineers are well suited for this mindset and that it stems from a slight mistrust of marketers and salesman. This is neither vituperation against engineers or any salesmen or marketers I have known, just that it is a general trend I have seen. I believe it is the result of encountering both sides of the sale. From the product designer perspective, there is often tension with marketers and salesmen when there is lack of communication. If the salesman talks to a customer and tells them that a new product can jiggle a widget 3x faster than the competition, the customer may purchase the product thinking it will always be jiggling at 3x of FluxCorp‘s latest product. But if the product can only sometimes and under the correct conditions jiggle that fast, well, there will be some problems; when the salesman relays back to the engineer that the customer is unhappy with their new product, arguments and finger pointing may ensue. On the other side of the sale, engineers often encounter sales forces descending upon them to encourage using their sub-widget in the new widget jiggler. If the salesman can supply a portion of the design to your new product then they will share in your success, because every new product made is a sale for them (albeit only a fraction of your product’s final sale price).  However, engineers sometimes encounter marketers and salesman (on the “being sold to” side of things) that may provide some “stretching” of the truth of a sub-widget’s ability. In either case, I believe that being a part of selling to others and being sold to helps hone engineers’ ability to sniff out when they are being sold something (as opposed to buying something because they want/need it). This is both something learned in engineering and a quality that some of the best engineers possess.

Yet another thing that drives engineers towards thriftiness is the nature of their jobs. If you look at an engineer and compare them to a scientist, there are some interesting distinctions. First, engineers are responsible for bringing products to market. This means that whatever technology they are using (oftentimes first discovered by scientists) must be viable on a large scale and must be done efficiently. If a scientist determines that a capacitor can hold more energy if you tap on it with your finger 1000 times before applying a voltage across it, that might be a brilliant (albeit completely fake) discovery. The engineer has to worry about how that capacitor can be sold at a reasonable price (in relation to the demand of the marketplace) and how to possibly produce millions of finger-tapped capacitors as fast as possible. Most importantly, the engineer and the company he/she works for is judged on the difference of the cost and the selling price (margin). More often than not the marketplace will be the one determining the price, so the only option for making more money is to reduce the costs in producing the product. A scientist may have external funding which allows for time to discover the newest technologies that will be later implemented; there is less direct influence on the success of the technology by near-term funding (though I know grant-writing is no picnic). The direct payoff and re-investment of profit from a successful product introduction influences how engineers operate. The thrifty engineers are successful because they can have the money they save go directly back into their next product.

A counter argument to being a (true) cheapskate is when it comes to quality. Many times in work and in life there can be significant savings from buying a quality product the first time. An example might be buying a high quality, variable temperature soldering iron (maybe even with an auto shut down). Compare that to buying a piece of junk Radio Shack soldering iron that you happen to leave on after working on your Wurlitzer. The former can last you many years and will perform well and help you solder many different products throughout its lifetime. The RS soldering iron burns out in less than a year (perhaps due to negligence, we’ll never know) and is not capable of soldering even the largest components properly. In this example there is money saved by not having to purchase another RS soldering iron and there is time saved while working on a project. So while I say that I am a cheapskate, I try to take all costs–including time–into account when purchasing something.

So answer the question Chris. Are engineers naturally cheapskates? After looking at the facts here it is pretty obvious that no, engineers are not naturally cheapskates; rather, they are often in a position to pick up money-saving skills while working on engineering issues and are well liked by management if they succeed in saving money. Also, if you happen to have some innate cheapness you will be at an advantage when starting out in engineering. Some of the people I have encountered in engineering have shown me the benefits of reducing costs in their personal lives and always knowing as much as possible about what they are buying so they can make make the best possible decision.

How about you? Are you a cheapskate? You definitely don’t have to be an engineer to be one. Do you find that engineers are naturally more thrifty? Please let me know in the comments or take the poll below!

[poll id=”2″]

Photo by MacQ

Categories
Blogging Economics Engineering

Squeaky Wheels Get The Job Hunting Tips

Last month, I had a not-so-nice commenter remark that my last post on blogging keeping me going through a recession was a waste of time. He or she went on to remark that they didn’t have a job and they were obviously looking for some help. While I can’t say I condone their harsh tone and unnecessary crudeness (I know, I know, it’s the internet), I do empathize with their jobless situation.

So today’s post is going to be on some ways (and notably some non-traditional ways) to go about getting a job and hopefully getting through this recession. Here is the big disclaimer though: I don’t know how many of these techniques work. I am basing them on my own ideas and experience and some are just brainstorms. Let’s start from the top with the most traditional methods of finding a job and work our way down to the silly and intriguing ideas. On with the show…

  1. Online job searches/classified ads — 4% success rate, 10% unemployment. Do the math and consider this one to be a non-option.
  2. Networking — Ahh man, I know I’m not going to get this point across like I want to, but there are so many ways this is important. I actually had a digital designer I worked with a few years back sit me down and explain the importance of networking, and I STILL didn’t get it. In fact, for a long time, I was infuriated by the idea that just who you know might get you a job, as opposed to what you know. But here’s what it comes down to: there are a ton of people who can do your job. In fact, there are a lot of people out there who can do your job better and possibly cheaper than you (think China). However, you are the person who was in the right place at the right time, with the right skills, the right charisma and the right contacts. Everything else you start learning the day you start your new position. Networking takes time, though, and you need to start it before you lose or leave a job. It means that you are friendly with the people you work with and you’re actively keeping in touch with people you used to work with.  If you haven’t been doing that, call up a former co-worker and see what they’re working on; you might find something interesting and you get to maintain a relationship easily.
  3. Vendors — Yes, this still falls under the category of networking, but in a different way. Vendors, for those of you who do not know, are people trying to sell you (an engineer or scientist) stuff. They can be salesmen, application engineers, marketers, you name it. If they’re trying to get you to buy what their company has to offer…they’re vendors. They are also in the unique position of trying to sell stuff to other people in your industry; therefore, they know a lot of people doing a lot of stuff that is similar to your job. If I lost my job tomorrow, my stack of vendor business cards would be the first thing I would reach for. Call up some of them and see what trends they see in the industry. Ask for a place to look for your next gig. If you don’t deal with vendors on a regular basis, try other people you interact with daily who have contact to the outside world (maybe the UPS or FedEX delivery person?).
  4. Get something published — You don’t need to publish a paper in IEEE or Nature to get noticed by people. Sure, those first two magazines will get you noticed by a lot of people, but you really only need one. Think smaller. Write a letter to an editor in EETimes or EDN (two of my favorites).  I know whenever I see a letter to the editor, I am usually curious to what kind of expertise that person has and what industry they work in. Make sure when people look you up they know how to find you and that you have some good examples of your work.
  5. Blog Comments — The traditional gatekeepers to knowledge have started to transition. Whereas engineers and scientists might have only had a few sources of news in the past, blogs now offer an alternative in myriad forms; be it a day-in-the-life format or an aggregation of smaller news stories that might interest an engineer or scientist, information is available everywhere these days. These outlets also provide new ways to find others interested in the same stuff as you. If you see a comment from someone on a blog that intrigues you, try to strike up a conversation with them or see if that person has their own website (usually a link from their name). Try contacting the writer of the blog and see how receptive they are to talking to their readers (hopefully very). Blogs provide information and a new method of meeting people online. As with many of the other items on this list, try the less traveled places first; don’t try writing to an administrator of slashdot if you are interested in tech stories. Look for some smaller blogs (maybe from people linking their own blogs on slashdot) and try to contact them.
  6. LinkedIn — One of the best ideas I have ever heard in a job hunt is “informational interviews” (I first read it in the classic “What Color Is Your Parachute”). Basically, you call up someone and ask them about what they do, their industry, job trends and anything else you think might be relevant to a position.  Sometimes people will pick up on the fact that you’re in the market for a job, but other times they might not and you just have an interesting conversation. The problem I always had though was how to get an interview. The best way would be through those contacts I mention when I talk about networking…but the real problem is when you don’t have any contacts either. Then you are in a bit of a tighter spot and you need to get creative. One technique suggested by a friend that had worked for me to look up people on my LinkedIn network; extra points if they work somewhere I think I would like to work. Then once I know their name I try to figure out what their company email might be (usually they’re standardized at companies) and try to email them to request if you can call them for an informational interview. Sure it’s a little sneaky, but I think it’s OK if you’re genuinely interested and not just trying to use them as a contact. Sometimes you won’t get a response, sometimes you’ll get a confused response, sometimes you get a grouchy person and sometimes you get a person who doesn’t mind taking a few minutes out of their day to talk to an inquisitive person. I’ll let you look up informational interview questions for yourself, but go through the interview, keep it brief and ask if they wouldn’t mind passing you a name of someone else to talk to; if they do, be sure to thank them profusely afterward. If they don’t pass you a name… thank them profusely anyway. If nothing else, you will get a good conversation and some more information about an industry that interests you. Note: I always tried to email people first before an informational interview. You could always try and call someone out of the blue (call a front desk, ask for them) and ask for an informational interview; they usually will be confused by this abrupt request. Refer to this technique (that I learned from some sneaky recruiters) only if you really would like to talk to someone and they are non-responsive to email (remember, there might be a reason).
  7. Work For Yourself — My friend Pat recently came up with a great idea while he looks for work. He has been helping me out with my (still) broken Wurlitzer, taking the old schematic and putting it into a modern CAD program. He gets the experience of using common, open-source tools and I get some free labor to help me with my board. He also mentioned learning other software while he is looking for work. I see this sprouting into other opportunities too; if you are working on a new piece of software, you’re likely going to go to discussion boards for help.  You might even get involved in the development of the open-source tools, all of which can provide great experience and great contacts. If nothing else, you can put hobbies on your resume that are relevant to your potential job (the only hobbies that should ever be listed in my opinion). Showing an employer that you are passionate about your chosen field (i.e. willing to go home and do the same stuff you just did for 8-12 hours that day) really can make you stand out in a crowd.
  8. Work For Free — Starting to get into ideas that I’m really not sure would work. Offer to work somewhere for free. This could be considered an “internship” or whatever you want to call it. You’d basically be working for two things (besides no money): contacts and experience. The latter might be limited, especially if you are working somewhere with a sensitive security policy. However, if you offer your services for free, you will get to meet people and that could be worth more than anything else. Remember, you want to look in the non-standard places for work, so don’t waste your time begging for a job at this place. If they don’t want to pay you to start with, they probably won’t want to pay you in the future (at least not in a recession). Instead, talk to everyone you meet and make them want to help you. This idea might be the most difficult of the bunch but if you can pull it off (namely getting the internship to start with), it might have the best chance of success.
  9. Guerrilla marketing — Are you particularly good at CAD programs? Have you created a novel circuit that you think might interest an employer? Have you made a website about analog electronics? Use non-standard ways to stand out; however, make sure you do this at non-standard times. Don’t walk up to a recruiter at a job fair and hand him a circuit diagram with your signature on it. Instead, find out who is in charge of the hiring process (non-HR) and send it to them. Better yet, use the idea in number 5 and figure out who that person is and send the circuit diagram as a thank you to each person you talk to along the way. As for the CAD designer, make your business card out of a circuit board or something else novel like that. Passively advertise that you are in the job market. The “Parachute” book mentions putting it on your answering machine that you are currently looking to have your contacts help your searching project. If you have a website or a facebook profile, make sure it is well known (your front page or your default status message)that you are in the market for a job and some of the best characteristics you can offer. Shameless? Nope, just a good way to get your name out there.
  10. Walk in a front door — This idea was the inspiration for this post and also the most ludicrous of the bunch. What would happen if you dressed up in your best suit and walked into an office and asked for a meeting with Mr. BigGuyInCharge? Sure, you’d need to figure out that person with some sneaky or not-so-sneaky methods prior to walking in there; but if you did it right, this technique has a small small chance of working. It’s like the in person cold call. Most managers won’t have anything to do with it, but that one time it might work that makes it all worth it. I’d suggest any of the above methods before this one, but since it was the inspriation for this post, I figured I had to include it.

The recurring theme for all of these ideas is stepping outside your comfort zone and to try approaches to non-standard job paths. You don’t have to try the most extreme of these ideas (like walking into an office asking to talk to a manager), but you might have to pick up a phone and call a bunch of people. Or you might need to develop some new skills on your own before applying for a new job. If you keep trying hard and keep trying different things (other than online applications), you’ll eventually find something. If you are lucky enough to be working right now, keep an eye out for friends and colleagues and help them when you can. Good luck to all and leave any other ideas you might have in the comments.

Photo by brettdarnell

Categories
Economics Renewable Energy Supply Chain

A Quick Thought on the Economics of Renewable Energy

I glanced at my natural gas bill today while cleaning up the house and was a little shocked at myself. I pride myself on being better than most on conservation (at least cognizant of it) and my usage was quite high. That was last month and I can only imagine this month will get worse. And yes, I do live in a rental house right now (with an energy efficient house in my near future), but that’s the case for a lot of people, especially lower income. So I got to thinking, what will stop people from using so much energy in their frosty, great northern homes?

The answer is, of course, money. It always has been. But now we’re in a climate where the costs are beginning to rise so fast that people who sat dormant before will begin to take action. In fact, this will also likely move people in all economic groups to take action; the most important of these being the middle- to lower-income groups. Why? Because costs like heating are a larger percentage so there will be a more voluminous cry from the masses for cheaper energy (not that we don’t love our green friends, pushing the renewable energy agenda and buying recycled elephant dung paper as Christmas gifts for family). Hopefully more people clamoring for energy efficient devices and alternative fuels will push us towards a tipping point (which I incorrectly identified as a singularity), where renewables become the norm and cost of energy will drop due to the abundance of natural energy, waiting to be converted. So as prices continue to increase–and the temporary drop in gas prices is undoubtedly temporary–the push from most people will be towards a more sustainable future.

How about you? Have you felt the need to push for more conservation lately solely on energy costs? Let me know in the comments.

Photo by nothern green pixie

Categories
Economics Renewable Energy Supply Chain

Cheaper than Coal?

My friend Cherish over at Faraday’s Cage is where you put your Schroedinger’s Cat sent me an article on solar power approaching the cost of coal (generated electricity). It’s a great article and it quotes Ray Kurzweil so I’m automatically a fan. However, I have no doubt in my mind that it WILL hit this price point (~$1/watt), it’s just a question of when.

The real thing I want to touch on and get responses to is: What happens when solar energy is cheaper than coal?

Coal is dumb

I think there will be gradual uptake by the large energy companies (most already have dipped a toe in the shallow end for solar power). Even large scale consumers will start to put renewable energy on their balance sheets, assuming it is cheaper. But then what? Business as usual? Am I allowed to keep my lights on all night, even if it is silly to do so? I’m confident that not only will solar be cheaper than coal, but over the long term, it will be MUCH cheaper because you get more lifetime out of a panel or a solar thermal system than you do with a lump of coal. So will prices go down from the power company? I’m not so sure about that one as I’m guessing they’ll want to pass their “investment costs” down to the consumers.

Another facet to this idea is whether or not consumers will start to take on the burden of their own energy generation. Will there be a deficit in the north and a surplus in the south? Will there be a grid efficient enough to transfer this energy transcontinentally? Will there ever be a storage mechanism that is feasible for all of the energy we could potentially harvest from the sun (I just heard about this idea and thought it was really cool)? Or is the individual power generation scheme doomed to fail because there is still an energy broker in the middle (the power company) for all those times when the sun isn’t shining (and the wind isn’t blowing if that becomes a more efficient source of power also).

If power consumption continues to get cheaper and everyone adopts a renewable stance on it, will the environment actually improve? Will there be as much focus on conservation, both in reducing power needed in devices and total consumption per capita (reducing our individual “carbon footprint”)? Will the cheap energy of the future fuel the next boom and pull us out of the doldrums of this dumb recession?

So many questions. So so many and we still haven’t even found out if we CAN make it cheaper than coal yet (cautiously optimistic here). Renewable energy will be translating to big money for some people over the next ten years and that means lots of conflict. What do you think will happen when/if solar becomes cheaper than coal?