Just after New Year’s Day, I was in REI’s Bargain Basement and found many pairs of Five Fingers that had been returned. Bought this solid pair of KSO for $20.

REI Bargain Basement Beauties scored for $20!

These at first were great. Lots of stair training to start off the new year. I am psyched to be participating in the Big Climb up Columbia Tower, Seattle’s tallest building, on March 25. The downside of the KSO is running when it is wet. In Seattle, that means all winter guaranteed. After a second soggy 10K the KSO upper fabric had stretched and caused the sole to rub in a few painful places on each foot. Blister city. Thank you KSO, I will see you again in rainless July.

Back to REI, no more Bargain Basement beauties left, so I bucked up and went upstairs to try on a pair of Bikila LS. The improved fabric on the upper and between the toes has made a big difference. The running inspired bottom is awesome. I have put about 70 km on them so far and not a single blister. Interestingly, these are a size bigger than the KSO pair, and overall, more comfortable. I found it worth taking the time to try them on and did not even mind paying full price with the famous REI guarantee. Big fan of the Bikila LS. If you are looking at a pair for running check these out.

Bikila LS after a 10 mile trail, beach, stairs run.

If you are thinking of making the switch, I would recommend the following:
1) Read Born to Run. Great book and will inform and inspire.

2) There is an adjustment with your body. My legs look a few weeks to get comfortable with no drop from a minimal 5-10 mm drop. It was never painful, just working muscles in new ways. Some people consider it a con. Chi Running, Pose Method or even 100 Ups all preach a basic truth: Do not run on your heels. UPDATE: See Comments for more from Chi Running.

3) Vibram Five Fingers are machine washable. Great to know that I can go get wet and dirty. Both pairs clean up well.

Originally conceived to be part of another work, Rodin’s Thinker changed the way we look at modern sculpture. Like most things disruptive, this was not the intent but the result. Something to think about.

Puget Sound is home to a couple of orca pods, but until yesterday I have never seen them near Seattle. These whales usually hang out in the San Juan Islands and will make trips down to the south Puget Sound. These whales were headed towards West Seattle. I was able to catch them as they passed the Magnolia bluff. Only wish I had a longer lens.

It was an amazing way to wrap up an beautiful, spring-like day.

Here is some excellent video by Jessica Papkoff as they passed Golden Gardens

Untitled from Jessica Papkoff on Vimeo.

The Blue Ocean Strategy has become a staple of business strategy and most MBA programs. At its core, the Blue Ocean strategy is about value innovation.

“Red” oceans are known industries and markets. The competition is constantly trying to outperform rivals and the waters bloody. It is an inevitable race to a pure commodity market. “Blue” oceans are industries and markets that are unknown today. Demand is created rather than fought over. There is ample opportunity for growth and profit. Blue oceans are often created from red oceans. A competitor finds an opening to create value and finds their blue ocean. Several examples are cited such as Henry Ford and the Model T and more recently Michael Dell and Dell Computer. I believe that Facebook would be another example since they have been able to execute on an idea that was not necessarily new (i.e. Friendster, MySpace, etc.).

The authors, Kim and Mauborgne, are too dismissive of red ocean companies. They state rather bluntly that corporate strategy is heavily influenced by its roots in military strategy. While this is in fact true, the authors insist that the goal of military strategy is to engage and combat the enemy. Competition, confronting the opponent and driving him from the battlefield are listed; however this is not military strategy. It is the goal of a direct attack. The direct attack is only one strategy that can be used and it is usually the one of last resort. This notion made me think how the blue ocean strategy would compare to Sun Tzu’s The Art of War, one of the oldest and most successful books on military strategy.

Here are some select passages from The Art of War that conflict with the red ocean view of corporate/military strategy:
1) All warfare is based on deception.
2) In all history, there is no instance of a country having benefited from prolonged warfare.
3) Supreme excellence consists in breaking the enemy’s resistance without fighting.

Sun Tzu would not advocate a red ocean. In contrast, The Art of War is blue ocean:

You can only be sure of succeeding in your attacks is you only attack places that are undefended.

Pretty clear talk of finding uncontested market space, capturing new demand and making the competition irrelevant. In contrast, red oceans are prolonged fights exploiting differentiation or cost. These are commodity markets, not drivers of innovation. Blue oceans are value innovators and have been known to mankind for since at least the 6th century BC. Red oceans work if and only if there are in fact commodity markets. Perhaps for agricultural products and metals, but what about technology? What about something as simple as an electric toaster? After all electric toaster was invented in 1893. These should be freely traded on the open market, the reddest of red oceans right? For more data and history on toasters and a fine article on commoditization read Schrage’s The Myth of Commoditization. Another compelling look at why red oceans aren’t so red.

A piece of Seattle history is likely to finally meet its end in what has been a long and sad decline. The Kalakala, a beautiful art deco ferry, served the Seattle to Bremerton route for decades. After being rescued from live as a fish canary in Alaska the many rescue attempts have all been fruitless in their attempts to return the ship to it’s glory. There is news that she has now been battered by the recent storm. When she was towed from Lake Union in Seattle, people turned out in droves to see the ferry go through Ballard Locks to see a bit of Seattle history. Many were sentimental remembering when they rode the ferry. While I never did, I will admit to getting caught up in the nostalgia.

Two worthwhile recent articles on the Kalakala:
Three Sheets Northwest: Storm-damaged Kalakala close to sinking

NPR: Sinking Ship? Saving The Historic Kalakala Ferry

After a brief introduction, Steve jumped in with why joining a startup is like being a VC. In his view, both VCs and those thinking of joining a startup eed to look for the same things. Here are the highlights:

1 Execution over ideas.
Ideas do not make a great company, but execution does. Think Facebook, not Friendster.

2 Due diligence is critical.
Understand the market and the competition. If you are not willing to pay for the product or service, why would anyone else? There will always be gaps in due diligence, but minimize them.

3 “Know where the puck is going” ~ Wayne Gretzky
Some great local examples of Gist and Redfin. Be sure to join the company for what it will be tomorrow.

4 Understand valuation and stock option value
This resonated the most with me. Startups are typically not prepared to deal with sophisticated questions around valuation. If you are willing to take the risk, they should provide a picture of the value of options as compensation.

5 Diversify
Time is capital. Give an opportunity 2-3 years, if it is not there do not be afraid to cut your losses.

Thanks again, Steve, a true Rock Star!

This is a Kodak Brownie No 2A, Model B that my great-grandmother purchased sometime around 1920. It still works. I was able to find some 116 film for it a few years ago and took this timeless picture of the Space Needle.

Much has already been written about the demise of Kodak and their likely impending bankruptcy filing. Many focus on the “cash cow” of film and how while Kodak invented many of the critical elements of digital photography they never capitalized as they should have. These articles are missing a critical piece to understand the long, slow death of an American great. Kodak had started to abandon and alienate even film customers as early as 1984.

What happened in 1984? Kodak eliminated the dated 116 and 616 formats used by my Brownie above. But that is not the real reason. Truth is that Kodak was starting to feel the heat of true competition from Japanese rivals like Fujiflim. How it responded is why the company failed. The company had twice been slapped with antitrust consent decrees. Kodak litigated its way to having those decrees removed in 1994. Later, Kodak attempted to inflame US-Japanese trade tensions with filing a Section 301 petition against Fujifilm. At the time, then CEO George Fisher had had success successfully used legal and political leverage to alter market behavior in Japan when he ran Motorola. The trade dispute was pre-emptive. Kodak’s never filed its concerned with the Japanese government before filing this petition. Amazingly the company disregarded that at the time it was being outspent in the Japanese market by a ratio of 10:1 while charging more for its own film. Somehow, Kodak was still able to have about 10% of the Japanese market. While the company sought to litigate in the US and Japanese markets, it failed to keep pace with innovation in film. Two examples where Kodak did not live up to its comparative advantage. First is the one-time use camera. Fujifilm introduced the one-time use camera that thrilled the Japanese public. A camera could now be purchased cheaply just about anywhere from a department store, drug store or kiosk. The product became an immediate hit. Kodak did not respond to this new product development for two years. Second is high resolution ISO 400 film, a technical breakthrough that addressed the image quality issues. It was a huge success. Again, Kodak did not respond to this new product development for two years.

Kodak consistently choose to cede two years of first-mover advantage to Fujifilm. This is not the Kodak you will read about over the coming days. This great American company lost its way long before the advent of the digital photography. Kodak lost the innovation edge and resorted to attacking the nature of free enterprise to protect its markets. As a result, it lost in the long-term.

That should be a lesson worth remembering today.

I used to bank with a large national bank. When the wife (Disclosure: the wife works for Amazon but does not read my blog) and I married, we consolidated accounts to another bank, but kept this account to have a local presence. This arrangement worked for the last 7 years. Yesterday, I received my statement which included in my opinion ridiculous fees. Now, I was never informed that these fees would be incurred. The statement was the only notification. I am sure that there was some fine print that I missed; however nearly $20 for a “free checking” account is just poor business. I went to the local branch to close the account and they did do their best to try to keep my business. Given how these fees were incurred, large unnamed bank did not want my business any longer, so I was happy to oblige.

This afternoon, I re-started working on a project to extend a WiFi antenna into my attic. This has long been on my to-do list. During the basement remodel when I wired the house with coax and Cat 5e, I even ran a 50 ohm coax cable into the basement to extend the antenna. I never finished the project. Recently, I purchased what I believed to be the correct TNC connectors. Well, I goofed. I bought the wrong ones. The return process from Amazon (Disclosure: the wife does not work for the retail side of Amazon) was dead simple. I was not even required to return the connectors. Amazon just gave me the refund! While I may be a great customer, the shipping and restocking costs were likely more than the cost of the connectors. Not only does it make good business sense, it is an incredible customer experience. Hey, I am even blogging about it.

So who are you, large unnamed bank or Amazon? Can you delight customers while still making sound business decisions? How will your customers rate their experiences? Keep these questions in mind and stay customer obsessed in 2012!

Water Temp: 48, Air Temp: 46. Clear and sunny weather at Golden Gardens this morning. This was much warmer than my Thanksgiving swim. Could have done some yardage if I had brought goggles.

Lots of people out there today, so my kind of crazy has company. Just remember this can even be healthy. All the best in 2012!

Happy New Year and best wishes for an amazing 2012!

This is a view of the start of the Space Needle fireworks from a few years back with my trusty Xpan. It is one of my favorite images since the Space Needle was encased in smoke about 2 minutes later.

You can check out my entire portfolio at Salmon Bay Photography.