Monday, August 30, 2010

When Flying Was Mysterious











Remember when pilots and flight attendants that worked for the likes of Pan Am, Southwest and even United were almost movie stars walking throughout the terminal…..and they carried a sense of mystery where had the been, where were they going.

You imagined somewhere exotic and adventurous far from the ordinary corn fields of home.

http://dairyairstoriesfrom37000ft.wordpress.com/2009/07/10/jetstream-history-of-the-sky-sexy-stews/


Tempted by Bonus Miles? Do the Math










Investors who follow the adage buy low, sell high may want to avoid airline "bonus mileage" programs. Travelers who buy frequent-flier miles pay about 3 cents per mile, but then they typically redeem them for tickets at 1.5 cents each—or even less.

Mileage bonus programs—in which consumers buy frequent-flier miles directly from the airline—are popular with travelers. US Airways says about 5% of its customers are opting to pay to double or triple their miles when they buy tickets, and that revenue from mileage sales was up 236% in the first six months of this year compared to the same period of 2009.

Sales on AirTran Airways' program are up 40% this year, a spokesman said. Alaska Airlines said its mileage sales are "very robust" and now top $1 million a month. United says it's doing 700 double- or triple-mileage transactions per day.


American Airlines won't say how many of its customers are buying since its May launch of the "Mileage Multiplier" promotion, where ticketed passengers can pay a fee and earn double or triple the miles on a trip. But some are going in for 10,000 and 20,000 miles.

"Many folks are just crazy for more miles," said Derek DeCross, president of American's AAdvantage frequent-flier program. "Some people just really, truly want to have as many miles as possible."

Donald Adam, a top-tier elite frequent flier on American, was curious about carrier's offers pitched this summer that for a fee would let him double or triple the miles he earned on a trip. He didn't do the calculations at the check-in kiosk, but passed, sensing that was it wasn't a good deal.

He's right. Double miles between New York and Los Angeles would cost $81 one-way, including an excise tax, for example. But that's 3.3 cents for each of the extra 2,475 miles he'd get.

Frequent-flier miles hold a special place in the consumer psyche. People cherish them, hoard them and arrange their buying and spending to maximize them. But they rarely deliver real value: It can be hard to find the award tickets or upgrades you want, and travelers often cash them in for cheap tickets, getting minimal return for their precious assets. When frequent-flier programs began more than 25 years ago, airlines found they were powerful incentives to keep travelers loyal to their brand.

Then they found they could sell miles to credit-card companies, hotels, florists, charities and other merchants who wanted to give out miles as rewards to their customers. (They sell those miles in bulk at roughly one cent per mile.)

Every major U.S. airline, except Continental and Southwest, sells additional miles to members of its frequent-flier program. Points.com, which processes mileage-purchase transactions for a majority of U.S. carriers, says it sells about $250 million worth of miles to consumers annually.

Most airlines charge between 2.5 cents and 3 cents per mile; some add a $25 or $30 processing fee, and all collect a 7.5% federal excise tax, putting the total cost at more than 3 cents a mile in most cases. For a 10,000-mile purchase, United is the most expensive at $358. Alaska and US Airways are the cheapest at $296.

Purchased miles don't count toward elite status, and sales at airlines are non-refundable. Most airlines limit how many miles you can buy each year to 40,000 to 60,000.

Airlines, being airlines, do offer sales on miles. Currently American offers a 3,000-mile bonus for every 10,000 miles you buy through Aug. 31. Each customer is limited to 12,000 bonus miles. United has been offering its double- and triple-miles at prices reduced by 20%, but that offer ends Friday.

Consumers typically buy miles to top off accounts and reach awards faster, airlines say. In most cases, buying 25,000 miles for a domestic coach ticket wouldn't make sense—you'd spend $841 at United, for example. "If I can spend $250 to top off an account or spend $480 and buy the ticket, the miles look attractive," said Christopher Barnard, president of Points International Ltd., the parent of Points.com.

United believes savvy road warriors, not just infrequent fliers, are taking advantage of the bonus mileage offers. When redeemed for upgrades or for last-minute tickets, miles can deliver more than 3 cents of value apiece, sometimes up to 10 cents a mile or more. "We're seeing more of our elite consumers taking this offer,'' said Tim Simonds, United's managing director of marketing.

If you really work it, getting a ticket by buying miles may be cheaper than paying the regular fare. Alaska sells a lot of miles to people topping off accounts, and a lot to people making huge purchases. The reason: Alaska miles, which have no annual limit on purchases, can be converted into tickets on partner airlines, such as first-class seats on British Airways that go for 140,000 miles round-trip.

It turns out buying 140,000 miles for $4,139 and redeeming them for an award ticket (you have to pay a fuel surcharge, too, of up to $600) is cheaper than buying a first-class ticket, which starts at more than $12,000 for a Seattle-London round-trip. You buy miles for 3 cents apiece and redeem them for a ticket worth at least 8.6 cents per mile.

One big catch: There's limited availability of first-class award seats on British Airways.

"If the value wasn't there, they [mileage sales] wouldn't be so popular," said Rick Rasmussen, Alaska's director of customer loyalty and marketing programs. "Customers do the math."

The math works for business-class tickets, though not as dramatically. For Seattle-London tickets, British Airways tickets start at $5,037. Buying 120,000 miles from Alaska costs $3,548. Even after the fuel surcharge, you'll save more than $1,000.

Alaska offers bonus miles a different way as well: The airline gives customers the chance to pay extra when buying a ticket to add 1,000, 2,500 or 5,000 "Fly and Buy" miles to the mileage earned. Paying for an extra 5,000 miles costs $117 tax included, or 2.3 cents per mile. That's a discount to outright mileage purchases—buying 5,000 miles separately from a ticket on Alaska costs $148 tax included.

Another way to push accounts over award redemption levels is to transfer miles from another account, either a relative or even someone you're willing to pay for their miles. Most airlines charge a penny per mile for transfers and add a $25 or $30 fee. United is most expensive at 1.5 cents a mile, plus $30. Transferring 10,000 miles costs $185.

Through the end of the month, Delta Air Lines is offering a 50% mileage bonus for transfers—transfer 10,000 miles to someone and pay Delta $130, and the airline will put 5,000 miles into your account.

middleseat@wsj.com


Tracking Your Health

Some websites let you enter daily health data and observations and provide useful feedback that can be shared with doctors:

* TheCarrot.com: Online journal lets users track 30-plus health factors including weight, food intake, energy level and exercise and input data from an iPhone. Produces reports that track factors together, such as exercise and mood.

* PatientsLikeMe.com: Offers surveys about diseases, conditions, treatments and symptoms. Users can chart health over time and compare progress to patients with similar conditions.

* MyPyramidTracker.gov: Government-sponsored site lets users enter dietary information and exercise. Provides picture of food intake vs. activity level for several days or up to a year. Compares daily dietary information and exercise to current guidelines.

* Keas.com: Offers tools to track personal data and health plans to manage weight, chronic conditions, depression or pregnancy. Users can sign up for condition-specific care plans such as headaches and keep diaries on headache triggers.

* RevolutionHealth.com: Provides health trackers for blood pressure, blood sugar, pregnancy weight gain, pregnancy temperature, exercise.

* Baby-Connect.com: Lets authorized users on iPhones, iPads, iPods or website track daily information on infants including food intake, diaper changes, sleep, mood, growth milestones, medications and vaccines.

* HealthButler.com: Preventive health information service lets users track healthy habits and compliance with preventive health measures over time; links screening and preventive history to Google Health personal profile.

http://online.wsj.com/article/SB10001424052748703960004575427531544486778.html?KEYWORDS=Landro

Friday, August 27, 2010

Bipolar Disorder



"...people are born with the gun, life pulls the trigger..."

Bipolar disorder involves periods of excitability (mania) alternating with periods of depression. The "mood swings" between mania and depression can be very abrupt.

The manic phase may last from days to months and can include the following symptoms:

  • Agitation or irritation
  • Elevated mood
    • Hyperactivity
    • Increased energy
    • Lack of self-control
    • Racing thoughts
  • Inflated self-esteem (delusions of grandeur, false beliefs in special abilities)
  • Little need for sleep
  • Over-involvement in activities
  • Poor temper control
  • Reckless behavior
    • Binge eating, drinking, and/or drug use
    • Impaired judgment
    • Sexual promiscuity
    • Spending sprees
  • Tendency to be easily distracted

These symptoms of mania are seen with bipolar disorder I. In people with bipolar disorder II, hypomanic episodes involve similar symptoms that are less intense.

The depressed phase of both types of bipolar disorder involves very serious symptoms of major depression:

  • Difficulty concentrating, remembering, or making decisions
  • Eating disturbances
    • Loss of appetite and weight loss
    • Overeating and weight gain
  • Fatigue or listlessness
  • Feelings of worthlessness, hopelessness and/or guilt
  • Loss of self-esteem
  • Persistent sadness
  • Persistent thoughts of death
  • Sleep disturbances
    • Excessive sleepiness
    • Inability to sleep
  • Suicidal thoughts
  • Withdrawal from activities that were once enjoyed
  • Withdrawal from friends

There is a high risk of suicide with bipolar disorder. While in either phase, patients may abuse alcohol or other substances, which can worsen the symptoms.

Sometimes there is an overlap between the two phases. Manic and depressive symptoms may occur simultaneously or in quick succession in what is called a mixed state.

For the manic phase of bipolar disorder, antipsychotic medications, lithium, and mood stabilizers are typically used. For the depressive phase, antidepressants are sometimes used, with or without the manic phase treatment.

There is very little long-term evidence suggesting that any medication has great success in the maintenance phase. However, in studies that followed patients for 2 years, lithium and some antipsychotics were found to be moderately successful.

Antipsychotic drugs can help a person who has lost touch with reality. Anti-anxiety drugs, such as benzodiazepines, may also help. The patient may need to stay in a hospital until his or her mood has stabilized and symptoms are under control.

Electroconvulsive therapy (ECT) may be used to treat bipolar disorder. ECT is a psychiatric treatment that uses an electrical current to cause a brief seizure of the central nervous system while the patient is under anesthesia. Studies have repeatedly found that ECT is the most effective treatment for depression that is not relieved with medications.

Getting enough sleep helps keep a stable mood in some patients. Psychotherapy may be a useful option during the depressive phase. Joining a support group may be particularly helpful for bipolar disorder patients and their loved ones.

Bipolar disorder affects men and women equally. It usually appears between ages 15 - 25. The exact cause is unknown, but it occurs more often in relatives of people with bipolar disorder.

Bipolar disorder results from disturbances in the areas of the brain that regulate mood.

There are two primary types of bipolar disorder. People with bipolar disorder I have had at least one fully manic episode with periods of major depression. In the past, bipolar disorder I was called manic depression.

People with bipolar disorder II seldom experience full-fledged mania. Instead they experience periods of hypomania (elevated levels of energy and impulsiveness that are not as extreme as the symptoms of mania). These hypomanic periods alternate with episodes of major depression.

A mild form of bipolar disorder called cyclothymia involves periods of hypomania and mild depression, with less severe mood swings. People with bipolar disorder II or cyclothymia may be misdiagnosed as having depression alone.

A diagnosis of bipolar disorder involves consideration of many factors. The health care provider may do some or all of the following:

  • Ask about your family medical history, particularly whether anyone has or had bipolar disorder
  • Ask about your recent mood swings and for how long you've experienced them
  • Observe your behavior and mood
  • Perform a thorough examination to identify or rule out physical causes for the symptoms
  • Request laboratory tests to check for thyroid problems or drug levels
  • Speak with your family members to discuss their observations about your behavior
  • Take a medical history, including any medical problems you have and any medications you take

Note: Use of recreational drugs may be responsible for some symptoms, though this does not rule out bipolar affective disorder. Drug abuse may itself be a symptom of bipolar disorder.

Mood-stabilizing medication can help control the symptoms of bipolar disorder. However, patients often need help and support to take medicine properly and to ensure that any episodes of mania and depression are treated as early as possible.

Some people stop taking the medication as soon as they feel better or because they want to experience the productivity and creativity associated with mania. Although these early manic states may feel good, discontinuing medication may have very negative consequences.

Suicide is a very real risk during both mania and depression. Suicidal thoughts, ideas, and gestures in people with bipolar affective disorder require immediate emergency attention.

Stopping or improperly taking medication can cause your symptoms to come back, and lead to the following complications:

  • Alcohol and/or drug abuse as a strategy to "self-medicate"
  • Personal relationships, work, and finances suffer
  • Suicidal thoughts and behaviors

This illness is challenging to treat. Patients and their friends and family must be aware of the risks of neglecting to treat bipolar disorder.

Call your health provider or an emergency number right way if:

  • You are having thoughts of death or suicide
  • You are experiencing severe symptoms of depression or mania
  • You have been diagnosed with bipolar disorder and your symptoms have returned or you are having any new symptoms.
https://health.google.com/health/ref/Bipolar+disorder

Wednesday, August 25, 2010

Digital Detox














It’s 1 p.m. on a Thursday and Dianne Bates, 40, juggles three screens - her iPod, her iPhone, and her elliptical machine's LCD.

As Ms. Bates multitasks, she is churning her legs in fast loops on an elliptical machine in a downtown fitness center.

In gyms and elsewhere, people use phones and other electronic devices to get work done — and as a reliable antidote to boredom.

Cellphones, which in the last few years have become full-fledged computers with high-speed Internet connections, let people relieve the tedium of exercising, the grocery store line, stoplights or lulls in the dinner conversation.

The technology makes the tiniest windows of time entertaining, and potentially productive. But scientists point to an unanticipated side effect: when people keep their brains busy with digital input, they are forfeiting downtime that could allow them to better learn and remember information, or come up with new ideas.

Ms. Bates, for example, might be clearer-headed if she went for a run outside, away from her devices, research suggests.

At the University of California, San Francisco, scientists have found that when rats have a new experience, like exploring an unfamiliar area, their brains show new patterns of activity. But only when the rats take a break from their exploration do they process those patterns in a way that seems to create a persistent memory of the experience.

The researchers suspect that the findings also apply to how humans learn.

“Almost certainly, downtime lets the brain go over experiences it’s had, solidify them and turn them into permanent long-term memories,” said Loren Frank, assistant professor in the department of physiology at the university, where he specializes in learning and memory. He said he believed that when the brain was constantly stimulated, “you prevent this learning process.”

At the University of Michigan, a study found that people learned significantly better after a walk in nature than after a walk in a dense urban environment, suggesting that processing a barrage of information leaves people fatigued.

Even though people feel entertained, even relaxed, when they multitask while exercising, or pass a moment at the bus stop by catching a quick video clip, they might be taxing their brains, scientists say.

“People think they’re refreshing themselves, but they’re fatiguing themselves,” said Marc Berman, a University of Michigan neuroscientist.

Regardless, there is now a whole industry of mobile software developers competing to help people scratch the entertainment itch. Flurry, a company that tracks the use of apps, has found that mobile games are typically played for 6.3 minutes, but that many are played for much shorter intervals. One popular game that involves stacking blocks gets played for 2.2 minutes on average.

Today’s game makers are trying to fill small bits of free time, said Sebastien de Halleux, a co-founder of PlayFish, a game company owned by the industry giant Electronic Arts.

“Instead of having long relaxing breaks, like taking two hours for lunch, we have a lot of these micro-moments,” he said. Game makers like Electronic Arts, he added, “have reinvented the game experience to fit into micro-moments.”

Many business people, of course, have good reason to be constantly checking their phones. But this can take a mental toll. Henry Chen, 26, a self-employed auto mechanic in San Francisco, has mixed feelings about his BlackBerry habits.

“I check it a lot, whenever there is downtime,” Mr. Chen said. Moments earlier, he was texting with a friend while he stood in line at a bagel shop; he stopped only when the woman behind the counter interrupted him to ask for his order.

Mr. Chen, who recently started his business, doesn’t want to miss a potential customer. Yet he says that since he upgraded his phone a year ago to a feature-rich BlackBerry, he can feel stressed out by what he described as internal pressure to constantly stay in contact.

“It’s become a demand. Not necessarily a demand of the customer, but a demand of my head,” he said. “I told my girlfriend that I’m more tired since I got this thing.”

In the parking lot outside the bagel shop, others were filling up moments with their phones. While Eddie Umadhay, 59, a construction inspector, sat in his car waiting for his wife to grocery shop, he deleted old e-mail while listening to news on the radio. On a bench outside a coffee house, Ossie Gabriel, 44, a nurse practitioner, waited for a friend and checked e-mail “to kill time.”

Crossing the street from the grocery store to his car, David Alvarado pushed his 2-year-old daughter in a cart filled with shopping bags, his phone pressed to his ear.

He was talking to a colleague about work scheduling, noting that he wanted to steal a moment to make the call between paying for the groceries and driving.

“I wanted to take advantage of the little gap,” said Mr. Alvarado, 30, a facilities manager at a community center.

For many such people, the little digital asides come on top of heavy use of computers during the day. Take Ms. Bates, the exercising multitasker at the expansive Bakar Fitness and Recreation Center. She wakes up and peeks at her iPhone before she gets out of bed. At her job in advertising, she spends all day in front of her laptop.

But, far from wanting a break from screens when she exercises, she says she couldn’t possibly spend 55 minutes on the elliptical machine without “lots of things to do.” This includes relentless channel surfing.

“I switch constantly,” she said. “I can’t stand commercials. I have to flip around unless I’m watching ‘Project Runway’ or something I’m really into.”

Some researchers say that whatever downside there is to not resting the brain, it pales in comparison to the benefits technology can bring in motivating people to sweat.

“Exercise needs to be part of our lives in the sedentary world we’re immersed in. Anything that helps us move is beneficial,” said John J. Ratey, associate clinical professor of psychiatry at the Harvard Medical School and author of “Spark: The Revolutionary New Science of Exercise and the Brain.”

But all things being equal, Mr. Ratey said, he would prefer to see people do their workouts away from their devices: “There is more bang for your buck doing it outside, for your mood and working memory.”

Of the 70 cardio machines on the main floor at Bakar Fitness, 67 have televisions attached. Most of them also have iPod docks and displays showing workout performance, and a few have games, like a rope-climbing machine that shows an animated character climbing the rope while the live human does so too.

A few months ago, the cable TV went out and some patrons were apoplectic. “It was an uproar. People said: ‘That’s what we’re paying for,’ ” said Leeane Jensen, 28, the fitness manager.

At least one exerciser has a different take. Two stories up from the main floor, Peter Colley, 23, churns away on one of the several dozen elliptical machines without a TV. Instead, they are bathed in sunlight, looking out onto the pool and palm trees.

“I look at the wind on the trees. I watch the swimmers go back and forth,” Mr. Colley said. “I usually come here to clear my head.”

Outdoors and Out of Reach, Studying the Brain

Five neuroscientists spent a week on a hiking and rafting trip to understand how heavy use of technology changes how we think and behave.

The Risks of Parenting While Plugged In

Parents’ use of smartphones and laptops — and its effect on their children — is becoming a source of concern to researchers.

Attached to Technology and Paying a Price

Scientists say our ability to focus is being undermined by bursts of information from e-mail and other interruptions.

An Ugly Toll of Technology: Impatience and Forgetfulness

“We’re paying a price in terms of our cognitive life because of this virtual lifestyle,” one expert says.

More Americans Sense a Downside to an Always Plugged-In Existence

Polls show that a number of Americans, particularly younger ones, are feeling negative effects from heavy computer and smartphone use.

Test Your Focus

Measure your ability to filter out distractions in this test based on a Stanford study


http://www.nytimes.com/interactive/2010/06/07/technology/20100607-distraction-filtering-demo.html?ref=your_brain_on_computers

First Steps to Digital Detox

http://roomfordebate.blogs.nytimes.com/2010/06/07/first-steps-to-digital-detox/?ref=your_brain_on_computers

http://topics.nytimes.com/top/features/timestopics/series/your_brain_on_computers/index.html

Tuesday, August 24, 2010

Companies Trying to Regain Control of Pricing

















8 tactics that companies are using to limit bargain hunters from finding their deepest discounts.

Note: I’m a deal shopper, and this shows that if you know how to shop on the internet, you’re in control.

Here’s what companies are trying to do to regain control of pricing.


In the beginning... manufacturers had control of pricing. Manufacturers were considered "upstream in the food chain". Intermediaries (sales channels, distributors, retail outlets) were considered "downstream" links, generating lower margins. Today, no single product supplier can compete against local specialists in all geographies. So, a big switch has occurred - product manufacturers and service providers get disintermediated.More about that trend here:

http://www.jimpinto.com/writings/disintermediation3.html


Manufacturers are now trying hard to reverse that trend. Until recently, not many people knew what those prices were. Keeping them under wraps is a key part of how companies maintain pricing power. Well, the secret is out. Now, thanks to the Internet, consumers are able to figure out those prices. And that is creating huge headaches for the companies.

Online shoppers today aren't just buyers; they're also product reviewers, technical consultants and scouts for legions of fellow shoppers hunting for bargains. Many use Web sites where links are posted for online coupons and cash-back offers—deals that some companies didn't intend to circulate so widely. Others go to sites where people discuss how to find the lowest bids acceptable on travel-service auction sites. Even shoppers for big-ticket items like cars get an edge from sites that reveal prices paid for new and used cars.

Further assisted by search engines and so-called shopping bots that find the lowest prices for any number of products, shoppers today have unprecedented power to buy products at the sellers' rock bottom. But if they come to expect such prices all the time, companies could see their long-term pricing power erode and profits slashed.

Here are 8 tactics that companies are using to limit bargain hunters from finding their deepest discounts.

1. What are people saying about you?

Shoppers find the lowest prices in different ways. Some cruise coupon and special-offer sites, like RetailMeNot.com and fatwallet.com. Many users of travel-auction sites like Priceline.com and Hotwire.com first visit BiddingForTravel.com or Betterbidding.com for bidding strategies and other tips.

Firms can search such Web sites and discover ways in which consumers are taking advantage, perhaps by combining discount offers or coupon codes. Companies have various options for discouraging such activities, including canceling codes or revising coupon or discount policies.

Finding out what people are saying about a company, its products or prices, can show that prices are too low. Monitoring online sales in real time helps, too. If sales of a product jump 100-fold in five minutes, it would be wise to analyze the transactional details and possibly stop further sales until you know what's going on. A price increase may even be in order.

2. Embrace, but try to limit, the bargain hunters

The object of each of these tactics is not to eliminate deep discounting. Fire sales are obviously necessary sometimes. With that in mind, companies will find a receptive audience on the Web sites that cater to bargain hunters. They just need to set some limits. They can offer coupon codes that are only usable a set number of times, for example, or discounts for a limited time and available only to users of the sites. This way a company can better manage how much of its product it will sell at the deepest discounts. Dell Inc., for one, regularly issues coupons at deal sites, but the coupons can only be used a fixed number of times.

3. Escape the commodity trap

When sellers market products with additional features or services, they force buyers to focus on the value of the package rather than on the costs of each piece. This helps reduce price transparency. Packaging, or bundling, a product with other products and/or services, makes it difficult for buyers to ascertain the specific cost of each single item within the bundle.

Questions to Ask Yourself

1. Does your company deal in products or services whose value is highly perishable or time-sensitive?

2. Do you offer online coupons or have multiple discount strategies that can be used by unlimited numbers of consumers?

3. Are your resellers sometimes discounting your goods without your authorization or knowledge?

4. Is your company unaware of what's being said on bargain-hunting and other shopping-related Web sites about its prices and products?

5. Do you make last-minute offers at cut-rate prices without full appreciation as to how that might undermine your established pricing schemes or your brand image?

If you answered yes to any of these questions, your company may need to reassert control over its pricing power by pushing back against the increasing ability of online shoppers to obtain your lowest acceptable prices. Selling unlabeled, marked-down merchandise through an intermediary is one strategy, as is bundling the goods with additional offerings so that the base value you've assigned to the products is less clear.

These approaches move consumers away from markets that are strictly price-oriented. The relationship that an automobile buyer develops with the dealership that also provides maintenance is one such example.

4. Control the sales network

Sometimes discounts are initiated by independent retailers, without the input or approval of the product's manufacturer. The more control a company exerts over its sales network, the less vulnerable it will be to such practices. Bose Corp., for example, a Framingham, Mass., maker of audio products, says it has a policy of announcing to resellers the minimum price for certain Bose products. A Bose spokeswoman says the company will "refuse to deal in a product with a dealer who fails to resell at or above the announced price."

5. Ban online customers who repeatedly eat into your profit margin

Companies can identify who their least-profitable online customers are—those who repeatedly abuse return policies, for example—based on their transaction histories. One common abuse: A customer buys an item and uses it; then, if the store lowers the price while the first purchase is still within its return period, the customer buys the item again but returns it with the first receipt.

Online customers who frequently carry out re-buys and returns of this kind can be tagged by their delivery address or credit-card number and barred from further purchases.

6. Clear the market

Often makers of products like sports equipment or clothing are left with surplus inventory after the product's scheduled run or expected shelf life. Such products often end up being sold through secondary channels that offer steep discounts. But for the manufacturers, those discounts can cannibalize the sales of similar, newer models.

A lot of brick-and-mortar retailers deal with these kinds of issues by selling their surplus through outlet stores in out-of-the-way locations. But on the Web, of course, no such outlands exist. Thus, Web-based retailers that see an alarming increase in end-of-season discounting by independent sellers of their goods should consider using buy-back programs. Buying back old or obsolete material from the independent sellers, either to destroy it or ship it overseas, helps protect prices.

7. Offer discounts through intermediaries

If Marriott International Inc. were to sell its own cut-rate, last-minute hotel reservations, it might undermine its established pricing schemes and sales channels, essentially by telling consumers the lowest prices it's willing to accept. That is the reason intermediaries like Priceline and Hotwire come into play. They disclose the seller brand only after the search and haggling period, when the transaction has been approved.

While the travel business may be the best known user of this approach, other industries use similar tactics. Online discount retailers, for example, can be powerful sales channels for quality products whose labels are removed or replaced with those of the house brand. Some online discounters remove labels from apparel and refer to their makers only as "famous brands."

8. Reshape the search landscape

Sellers and their intermediaries can change how their sites work when it becomes too easy for bargain hunters to figure out which brands are available at what cut-rate prices.

Priceline, for example, sometimes moves to better protect the identities of its hotel-company customers when it sees that certain hotels are repeatedly getting high numbers of bookings in a certain market. This tends to happen when users have found a low rate and spread the word. A spokesman says the company is not out to discourage its users from getting good prices, but it must offer its hotel-company customers price protection at the same time. One way it does this is by redrawing the zones in which it groups its hotels, making it less predictable what hotel will accept a certain bid in any given neighborhood.

In one case, for example, Priceline saw large numbers of bookings for some of its high-end hotels at the lowest prices those companies would accept. Users of travel auction sites like Priceline can't see the names or the ratings of the hotels on offer. But some had figured out a strategy for getting the best hotels at the lowest rates, and that was exposing the pricing strategies the specific hotels were using.

Formerly, Priceline bidders who were familiar with a city would know that certain neighborhoods were unlikely to have four-star or five-star hotels. So, they would start by requesting a hotel with four or five stars in a neighborhood not likely to have such a hotel, and at a low price not likely to be accepted. The site allows users to rebid when a search turns up nothing within the parameters desired, and as long as the user doesn't change the dates of the desired stay. Thus, the bidder could keep adding zones to his or her search with a slightly higher bid each time until a zone was included that featured a high-end hotel. At that point, based on the earlier low bids—and sometimes bidding low amounts suggested on the advice sites—the bidder would have established a price at or near the accepted low.

Priceline's solution was to redraw its hotel zones to include properties of every star-rating in each zone, and to put more rooms on offer, making it less likely that a given search would turn up no results, thus allowing the bidder to have another chance. Clearly, the more rebids a user has, the more opportunity he or she has to find the rock bottom. But the more hotels there are in the group, the less likely it is that bidders will repeatedly get the same hotel following similar strategies.

For Further Reading

Designing the Right Product Offerings
By David S. Evans and Karen L. Webster (Fall 2007)
Companies create product versions from multiple components. The big challenge is how to take the available components and combine them into the product versions and product lines that will maximize profits.

Why the Highest Price Isn't the Best Price
By James C. Anderson, Marc Wouters and Wouter van Rossum (Winter 2010)
How to practice value-based pricing that boosts profits and promotes better relationships with customers.

From Niches to Riches: Anatomy of the Long Tail
By Erik Brynjolfsson, Yu "Jeffrey" Hu and Michael D. Smith (Summer 2006)
The Internet marketplace allows companies to produce and sell a far wider range of products than ever before. This profoundly changes both consumer behavior and business strategy.

from reports@wsj.com.

End of Management

Business guru Peter Drucker called management "the most important innovation of the 20th century." It was well-justified praise. Techniques for running large corporations, pioneered by men like Alfred Sloan of General Motors and refined at a bevy of elite business schools, helped fuel a century of unprecedented global prosperity.

But can this great 20th century innovation survive and thrive in the 21st? Evidence suggests: Probably not. "Modern" management is nearing its existential moment.

Corporations, whose leaders portray themselves as champions of the free market, were in fact created to circumvent that market. They were an answer to the challenge of organizing thousands of people in different places and with different skills to perform large and complex tasks, like building automobiles or providing nationwide telephone service.

In the relatively simple world of 1776, when Adam Smith wrote his classic "Wealth of Nations," the enlightened self-interest of individuals contracting separately with each other was sufficient to ensure economic progress. But 100 years later, the industrial revolution made Mr. Smith's vision seem quaint. A new means of organizing people and allocating resources for more complicated tasks was needed. Hence, the managed corporation—an answer to the central problem of the industrial age.

For the next 100 years, the corporation served its purpose well. From Henry Ford to Harold Geneen, the great corporate managers of the 20th century fed the rise of a vast global middle class, providing both the financial means and the goods and services to bring luxury to the masses.

In recent years, however, most of the greatest management stories have been not triumphs of the corporation, but triumphs over the corporation. General Electric's Jack Welch may have been the last of the great corporate builders. But even Mr. Welch was famous for waging war on bureaucracy. Other management icons of recent decades earned their reputations by attacking entrenched corporate cultures, bypassing corporate hierarchies, undermining corporate structures, and otherwise using the tactics of revolution in a desperate effort to make the elephants dance. The best corporate managers have become, in a sense, enemies of the corporation.

The reasons for this are clear enough. Corporations are bureaucracies and managers are bureaucrats. Their fundamental tendency is toward self-perpetuation. They are, almost by definition, resistant to change. They were designed and tasked, not with reinforcing market forces, but with supplanting and even resisting the market.

Yet in today's world, gale-like market forces—rapid globalization, accelerating innovation, relentless competition—have intensified what economist Joseph Schumpeter called the forces of "creative destruction." Decades-old institutions like Lehman Brothers and Bear Stearns now can disappear overnight, while new ones like Google and Twitter can spring up from nowhere. A popular video circulating the Internet captures the geometric nature of these trends, noting that it took radio 38 years and television 13 years to reach audiences of 50 million people, while it took the Internet only four years, the iPod three years and Facebook two years to do the same. It's no surprise that fewer than 100 of the companies in the S&P 500 stock index were around when that index started in 1957.

Even the best-managed companies aren't protected from this destructive clash between whirlwind change and corporate inertia. When I asked members of The Wall Street Journal's CEO Council, a group of chief executives who meet each year to deliberate on issues of public interest, to name the most influential business book they had read, many cited Clayton Christensen's "The Innovator's Dilemma." That book documents how market-leading companies have missed game-changing transformations in industry after industry—computers (mainframes to PCs), telephony (landline to mobile), photography (film to digital), stock markets (floor to online)—not because of "bad" management, but because they followed the dictates of "good" management. They listened closely to their customers. They carefully studied market trends. They allocated capital to the innovations that promised the largest returns. And in the process, they missed disruptive innovations that opened up new customers and markets for lower-margin, blockbuster products.

The weakness of managed corporations in dealing with accelerating change is only half the double-flanked attack on traditional notions of corporate management. The other half comes from the erosion of the fundamental justification for corporations in the first place.

British economist Ronald Coase laid out the basic logic of the managed corporation in his 1937 work, "The Nature of the Firm." He argued corporations were necessary because of what he called "transaction costs." It was simply too complicated and too costly to search for and find the right worker at the right moment for any given task, or to search for supplies, or to renegotiate prices, police performance and protect trade secrets in an open marketplace. The corporation might not be as good at allocating labor and capital as the marketplace; it made up for those weaknesses by reducing transaction costs.

Mr. Coase received his Nobel Prize in 1991—the very dawn of the Internet age. Since then, the ability of human beings on different continents and with vastly different skills and interests to work together and coordinate complex tasks has taken quantum leaps. Complicated enterprises, like maintaining Wikipedia or building a Linux operating system, now can be accomplished with little or no corporate management structure at all.

That's led some utopians, like Don Tapscott and Anthony Williams, authors of the book "Wikinomics," to predict the rise of "mass collaboration" as the new form of economic organization. They believe corporate hierarchies will disappear, as individuals are empowered to work together in creating "a new era, perhaps even a golden one, on par with the Italian renaissance or the rise of Athenian democracy."

That's heady stuff, and almost certainly exaggerated. Even the most starry-eyed techno-enthusiasts have a hard time imagining, say, a Boeing 787 built by "mass collaboration." Still, the trends here are big and undeniable. Change is rapidly accelerating. Transaction costs are rapidly diminishing. And as a result, everything we learned in the last century about managing large corporations is in need of a serious rethink. We have both a need and an opportunity to devise a new form of economic organization, and a new science of management, that can deal with the breakneck realities of 21st century change.

The strategy consultant Gary Hamel is a leading advocate for rethinking management. He's building a new, online management "laboratory" where leading management practitioners and thinkers can work together—a form of mass collaboration—on innovative ideas for handling modern management challenges.

What will the replacement for the corporation look like? Even Mr. Hamel doesn't have an answer for that one. "The thing that limits us," he admits, "is that we are extraordinarily familiar with the old model, but the new model, we haven't even seen yet."

This much, though, is clear: The new model will have to be more like the marketplace, and less like corporations of the past. It will need to be flexible, agile, able to quickly adjust to market developments, and ruthless in reallocating resources to new opportunities.

Resource allocation will be one of the biggest challenges. The beauty of markets is that, over time, they tend to ensure that both people and money end up employed in the highest-value enterprises. In corporations, decisions about allocating resources are made by people with a vested interest in the status quo. "The single biggest reason companies fail," says Mr. Hamel, "is that they overinvest in what is, as opposed to what might be."

This is the core of the innovator's dilemma. The big companies Mr. Christensen studied failed, not necessarily because they didn't see the coming innovations, but because they failed to adequately invest in those innovations. To avoid this problem, the people who control large pools of capital need to act more like venture capitalists, and less like corporate finance departments. They need to make lots of bets, not just a few big ones, and they need to be willing to cut their losses.

The resource allocation problem is one Google has tried to address with its "20%" policy. All engineers are allowed to spend 20% of their time working on Google-related projects other than those assigned to them. The company says this system has helped it develop innovative products, such as Google News. Because engineers don't have to compete for funds, the Google approach doesn't have the discipline of a true marketplace, and it hasn't yet proven itself as a way to generate incremental profits. But it does allow new ideas to get some attention.

In addition to resource allocation, there's the even bigger challenge of creating structures that motivate and inspire workers. There's plenty of evidence that most workers in today's complex organizations are simply not engaged in their work. Many are like Jim Halpert from "The Office," who in season one of the popular TV show declared: "This is just a job.…If this were my career, I'd have to throw myself in front of a train."

The new model will have to instill in workers the kind of drive and creativity and innovative spirit more commonly found among entrepreneurs. It will have to push power and decision-making down the organization as much as possible, rather than leave it concentrated at the top. Traditional bureaucratic structures will have to be replaced with something more like ad-hoc teams of peers, who come together to tackle individual projects, and then disband. SAS Institute Inc., the privately held software company in North Carolina that invests heavily in both research and development and in generous employee benefits, ranging from free on-site health care and elder care support to massages, is often cited as one company that could be paving the way. The company has nurtured a reputation as both a source of innovative products and a great place to work.

Information gathering also needs to be broader and more inclusive. Former Procter & Gamble CEO A.G. Lafley's demand that the company cull product ideas from outside the company, rather than developing them all from within, was a step in this direction. (It even has a website for submitting ideas.) The new model will have to go further. New mechanisms will have to be created for harnessing the "wisdom of crowds." Feedback loops will need to be built that allow products and services to constantly evolve in response to new information. Change, innovation, adaptability, all have to become orders of the day.

Can the 20th-century corporation evolve into this new, 21st-century organization? It won't be easy. The "innovator's dilemma" applies to management, as well as technology. But the time has come to find out. The old methods won't last much longer.

—Adapted from "The Wall Street Journal Essential Guide to Management" by Alan Murray. Copyright 2010 by Dow Jones & Co. Published by Harper Business, an imprint of HarperCollins Publishers.