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CEO Daily: The Best in Business Reading

Good Morning.

It was another week in which the intensity of the machinations in Washington, D.C., seemed to vacuum up much of the energy of the press. Perhaps as a consequence, I encountered—or maybe just noticed—fewer weighty business-related articles. The one that struck me the most, in Lucky Peach, is entitled “Press The Button.” It examines the rise of automation in restaurants. Today, nearly 5,000 Chili’s, Outback, Red Robin, and Applebee’s restaurants have tablet computers deployed at tables, allowing customers to order—or pay—when they want to. “In the fancier precincts of the food-service world,” the article notes, “where watching a barista spend four minutes prepping a pour-over coffee is a customer’s idea of a good time, robots might not seem like the future of food culture. But spend some time at the restaurants where the majority of Americans eat every day, and you’ll catch a distinct whiff of automation in the air.”

The story explores what this means for customers (speed, convenience, and extra fun, since the tablets can also run games), restaurant owners (added revenues, since the technology seems to encourage customers to order and tip more), and workers (there the news is less good). And it goes on to discuss automation and employment more broadly:

The researchers ranked 702 separate occupations by their probability of being automated, on a scale from 0 (“not computerizable”) to 1 (“computerizable”). Jobs that required creativity, social skills, complicated motor skills, or the ability to navigate around an “unstructured work environment” got lower scores, since computers and robots are still fairly dull and clumsy, and will be for the foreseeable future.

So “chefs and head cooks” and “cooks, private household,” for instance, were both ranked toward the top, far higher than “economists,” “historians,” and “crossing guards,” thanks to the creativity and motor control necessary for high-level cooking. Restaurant managers, or “first-line supervisors of food preparation and serving workers,” got ranked somewhere in the middle, less likely to be automated than “embalmers,” but slightly more likely than “lifeguards, ski patrol, and other recreational protective service workers.” “Waiters and waitresses,” on the other hand, scored a precariously high .94, making their jobs safer than the apparently easy-to-automate “nuclear power reactor operators” and “umpires, referees, and other sports officials,” but only by a nose.


Most people, I assume, are more likely to crave human interaction with a server than with your average umpire or nuclear reactor operator (now, alas, associated in the public consciousness with Homer Simpson—d’oh!). But before long, it seems, we’ll not only order on-screen but receive our order via conveyor belt.


Can You Defeat The Non-Compete?

Waitresses might lose out to robots, but at least they don’t have to sign non-compete agreements, right? Maybe not for long. “Signing Away The Right To Get A New Job,” in the New York Times, reports that roughly one in five employees are now bound by contracts that bar them from taking a job with a competitor and that the rate of litigation of such matters has tripled since 2000. The surprising part is that these agreements are applied today not only to top executives but also to factory workers, laborers for drilling companies, and even hairdressers, according to the article. The tale of a quality control manager in a factory and his seemingly vengeful employer, TSG Finishing, is particularly chilling. The  manager helped customers with their orders—he was hardly a repository of the company’s deepest secrets—but was pursued in court for several years by TSG after he accepted an offer for a new job (with a $14,000 annual pay increase) from a rival. The company ultimately prevailed, leaving the worker $50,000 in debt.

The article points out that the area most associated with innovation—Silicon Valley—happens to be located in a state that bars non-compete agreements. Lately, too, states including Massachusetts to Utah (both of which compete with Silicon Valley as homes for tech companies) have begun moving to limit or eliminate such agreements. Will that be enough to turn the tide on this issue? I wouldn’t count on it.

What Color Is Your Food—And Why?

I wouldn’t normally include a Q&A in this space, but this discussion with Ai Hisano, a fellow in business history at Harvard Business School who is writing a book about Americans’ relationship with the color of food, was really captivating. I didn’t know, for example, that going back to the 14th century, people have been adding coloring to butter. Later, people began using chalk to whiten bread, according to Hisano, and some farmers apparently used to add a lead compound to milk to make it seem thicker. (In more recent times, I recall reading in the Wall Street Journal about how commercial salmon fishers can consult a color wheel to pick different varieties of food pellets to ensure the salmon achieve the most enticing shade of orange.)

Here’s a much more recent example and it really gets to the fascinating contradictions in peoples’ minds as to what qualifies as “natural”:

Starbucks was using what is called a cochineal dye, which is a natural dye derived from insects, to color its strawberry Frappuccinos. It’s a natural dye—it’s not synthetic—but many American consumers thought it was gross to use insects for dyeing a milkshake. So they petitioned against using those dyes, and Starbucks started using a tomato-based dye instead. Consumers were happy with that. But tomato-based dye for strawberry-flavored drinks is not really natural—it’s just assumed that it’s normal to color food, as long as the dyes or the ingredients are things that consumers consider safe or natural.

What Can You Learn From Bill Russell And Yogi Berra?

“The Seven Leadership Secrets Of Great Team Captains,” in WSJ magazine (it’s an excerpt from an upcoming book by Sam Walker), is an entertaining, sometimes counter-intuitive survey of the lessons to be gleaned from great player-leaders. Its approach is more anecdotal than this Harvard Business Review article I discussed some weeks back, so it doesn’t have the same intellectual heft. Still, there’s a reason writers favor anecdotes: They can deliver an emotional wallop. So it is for the captains chronicled here. A few, such as Bill Russell and Yogi Berra, are American sports legends. But the collection also includes a French handball player and the Brazilian soccer player whose role made it possible for Pele to be the star that he was. The lesson in that instance? He “took care of tough, unglamorous tasks.” Reading this assortment of examples, you’ll no doubt wish you had a few players like that on your team.

Nicholas Varchaver