Byline: By richard siklos section: Section C; Column 5; Business/Financial Desk; Pg. 1 Length

1245 of 1258 DOCUMENTS

The New York Times
January 5, 2007 Friday

Late Edition - Final

High-Tech Gadgets in Taxis Will Cut Profits, Cabbies Say
BYLINE: By RAY RIVERA
SECTION: Section B; Column 1; Metropolitan Desk; Pg. 4
LENGTH: 761 words
A plan to provide high-tech enhancements to New York taxicabs -- including touch-screen monitors that will allow passengers to watch television, get game scores and track their ride on a global positioning system -- drew angry reactions from cabdrivers yesterday who say they will have to foot the bill.

More than a dozen drivers squeezed into a cramped City Council hearing room yesterday to protest the high-tech amenities they will soon be required to install in their vehicles under new city guidelines. The Taxi and Limousine Commission, which regulates city cabdrivers, says the cost of installing and operating the equipment will range from $2,900 to $7,200 per taxi over a three-year period.

The plan also requires drivers to accept credit and debit cards. Drivers say the 3.5 percent transaction fee that they would pay would eat into their profits, and that if the card system is down, they could get stuck with the cab fare if the passenger is without cash.

''We're independent contractors, we're like entrepreneurs, and we're forced to take credit cards,'' said William Lindauer, 63, who said he had driven a cab in the city for 30 years. ''You can't force a restaurant to take credit cards. And entertainment, we're forced to provide entertainment?''

Mr. Lindauer was one of several drivers to testify before the Council's Transportation Committee, which is evaluating the costs and benefits of the new technology.

Commission officials defended the enhancements. The changes stem from a 2004 compromise in which medallion taxicabs -- the yellow cabs regulated by the city -- were allowed to raise fares by 26 percent in exchange for installing several technological improvements to improve customer service.

''These customer service improvements are delivering on a promise that we made to taxi riders almost three years ago, and represent a leap ahead of anything currently being offered to passengers anywhere in the taxi world,'' Matthew W. Daus, chairman of the Taxi and Limousine Commission, said in a statement after yesterday's hearing.

Many of the drivers at the hearing were members of the New York Taxi Workers Alliance, which represents about 7,000 drivers in the city. At least a few raised the possibility of a strike if the changes are fully instituted.

Drivers say the required global positioning system and automated system that records a trip could lead to an invasion of their privacy. But commission officials say the only data they would collect would be a trip's beginning and end. The commission also said the 3.5 percent credit card fees negotiated with the credit card companies is substantially less than what cab owners pay to accept credit cards.

More than 3,000 cabs accept credit cards around the city, paying about 5 percent per transaction plus a weekly fee of $8 to $12, according to the commission. Commission officials and vendors say allowing customers to pay with credit and debit cards will increase driver profits.

The city began rolling out the first of 200 taxis to be outfitted with the new equipment last month as part of a test. So far, though, only 28 cabs have been fully equipped, according to Andrew Salkin, the first deputy commissioner of the Taxi and Limousine Commission.

The commission expects that all 13,000 medallion cabs in the city will have the equipment installed by the end of 2007.

The commission has signed deals with four vendors to provide the equipment and operate the services. Each will provide different offerings for customers.

The system allows passengers to get information on dining and events around the city, get the latest news and scores, watch movie trailers and choose their own music. They can also get information on their driver and fares and, as is mandated for all the systems, watch as their ride is tracked by a global positioning system along a map. The system also includes advertisements, which the vendors say will eventually cut down on the monthly fees charged to the cab owners.

Ed Sloam, president of TaxiTech, one of the four vendors, said that 76 percent of customers who tested the system in a commission survey loved the system. Those who do not like it can turn it off, he said.

''Taxis in the city are finally coming into the 21st century,'' Mr. Sloam told committee members yesterday.

City Councilwoman Gale A. Brewer of Manhattan, who opposes the enhancements, said passengers should not be subjected to a barrage of advertising.

''I never want to see this, and I promise you no real West Sider wants to see this,'' she said.

URL: http://www.nytimes.com
SUBJECT: TAXICABS & LIMOUSINES (90%); CREDIT CARDS (89%); PAYMENT CARDS & SERVICES (88%); ENTREPRENEURSHIP (78%); GLOBAL POSITIONING SYSTEM (89%); CITIES (76%); CITY GOVERNMENT (76%); REGIONAL & LOCAL GOVERNMENTS (76%); LEGISLATIVE BODIES (76%); STRIKES (73%); SELF EMPLOYMENT (72%); DEBIT CARDS (68%); RESTAURANTS (68%); CUSTOMER SERVICE (62%); PROTESTS & DEMONSTRATIONS (76%); RIOTS (72%); FREELANCE EMPLOYMENT (67%) Taxicabs and Taxicab Drivers; Prices (Fares, Fees and Rates); Computers and the Internet; Credit and Money Cards; Television; Global Positioning System; Demonstrations and Riots; Finances; Taxicabs and Taxicab Drivers
ORGANIZATION: Taxi and Limousine Commission (NYC)
PERSON: MICHAEL MCMAHON (94%) Ray Rivera
GEOGRAPHIC: NEW YORK, NY, USA (92%) NEW YORK, USA (92%) UNITED STATES (92%) New York City
LOAD-DATE: January 5, 2007
LANGUAGE: ENGLISH
PUBLICATION-TYPE: Newspaper

Copyright 2007 The New York Times Company

1246 of 1258 DOCUMENTS

The New York Times
January 4, 2007 Thursday

Late Edition - Final

G.E. Magic Can Fade, After G.E.
BYLINE: By CLAUDIA H. DEUTSCH
SECTION: Section C; Column 2; Business/Financial Desk; A CHAIRMAN'S FALL; Pg. 1
LENGTH: 1316 words
When boards of directors go shopping for a new chief executive, their first stop is often General Electric.

After all, its disciplined approach to management, the ''G.E. Way,'' has been chronicled in a shelf's worth of books, including ''Winning,'' by its former chief executive, John F. Welch Jr., who gets much of the credit for his system of building a deep bench of talent. That system included rotating executives through many jobs, teaching them productivity and quality-control tools like Six Sigma, and training them at the company's vaunted management school.

G.E. executives were in such demand that just one week after Mr. Welch tapped Jeffrey R. Immelt as his successor in late 2000, the two runners-up were immediately lured away. Home Depot recruited Robert L. Nardelli, and 3M took W. James McNerney Jr.

But the ouster of Mr. Nardelli from Home Depot raises anew the question of whether G.E. executives are so bankable when they switch to new companies. The answer, many management experts say, is not necessarily.

Though Mr. McNerney has succeeded at both 3M and then at Boeing, Mr. Nardelli joins Lawrence R. Johnston, another high-flying G.E. executive who left in 2001 for a troubled tenure at Albertson's, among the alumni who did not live up to expectations.

''G.E. is still the best training ground on the planet, but that still doesn't mean that everyone is going to succeed,'' said Noel M. Tichy, a professor at the University of Michigan Business School who has written extensively about G.E.

If there is any pattern, experts say, it is that G.E. executives succeed when they switch to companies that are, well, a lot like G.E. -- big industrial firms that are dominant in their fields, or that need an infusion of manufacturing and research discipline, or that must grow by acquisition.

By contrast, they tend to have more trouble in companies, retailers like Home Depot, that require more fingertip feel to manage.

''G.E. people are good at getting structure, system and strategy right, but they don't always understand the soft issues like culture,'' said Boris Groysberg, an assistant professor at the Harvard Business School who recently studied 20 star G.E. managers who went on to run other companies.

Many management experts say that the very command and control management style that has characterized many successful G.E. executives may have led to Mr. Nardelli's downfall. They note that he shifted Home Depot's emphasis to the commercial market, installed all sorts of productivity tools and otherwise ''G.E.-ified'' the company.

But, they say, he did not recognize that sales associates react differently than white-collar managers to change, and thus need different incentives to embrace it. He closed stores and moved people around, which meant that many sales staff found themselves with new bosses.

He insisted that shelves be stocked during off hours, and he instituted formal inventory control and performance evaluation systems.

''He was foisting all this change on people who aren't necessarily looking to rise to higher levels in the organization, and so didn't see any upside for themselves in any of it,'' said Batia M. Wiesenfeld, associate professor of management at the Leonard N. Stern School of Business at New York University.

The style did not necessarily work for ambitious managers either, said Anthony J. Mayo, a lecturer at the Harvard Business School. ''He brought a classic G.E. top-down, autocratic command and control approach and style, which just did not work out of the context of G.E.,'' he said.

Mr. Mayo includes Mr. Welch, Stanley Gault, Lawrence Bossidy and several other former G.E. executives in his coming book, ''In Their Time: The Greatest Business Leaders of the 20th Century.'' But he said that his research turned up many ex-G.E executives who ignored ''context-based management,'' his term for tailoring management approaches to specific situations.

The G.E. way was particularly out of place in a retail operation, said James E. Schrager, clinical professor of entrepreneurship and strategy at the University of Chicago Graduate School of Business. ''Boards get overenthusiastic about the G.E. glow,'' he said. ''They forget that there's a big divide between selling light bulbs and appliances to stores and running the stores that sell them to consumers.''

Mr. Nardelli is not the first G.E. alumnus who took on another company amid much fanfare, only to leave under a cloud. John B. Blystone left G.E. to run the SPX Corporation in 1995; at first, shareholders applauded his cost-cutting methods. But revenue stalled. Mr. Blystone resigned in 2004 ''to spend more time with his family,'' amid controversy over his sale of SPX shares before the release of lackluster quarterly results.

Shares of Conseco leaped in 2000 when Gary C. Wendt, then the head of GE Capital, became its new chief. He was unable to turn the company around, and two years later he relinquished the chief executive slot; Conseco soon filed for bankruptcy protection.

Mr. Johnston left G.E. to run Albertson's in 2001; he closed stores and cut jobs, but still could not compete with the Wal-Mart juggernaut. Albertson's sales and stock plunged, and the company was eventually sold.

''G.E. people bring a great tool kit with them, but they really need the global learning centers, the diverse product portfolio, the access to capital, all of the resources of G.E. to maximize its value,'' said Nicholas P. Heymann, who follows G.E. for Prudential Securities.

There are many success stories too, of course. Mr. Bossidy, one of Mr. Welch's hand-groomed executives, was considered a savior at Allied Signal (later Honeywell), as was Mr. Gault at Rubbermaid. Kirk Hachigian continues to get high marks at Cooper Industries. John Trani ran into problems with Stanley Work's unions toward the end of his tenure, but he nonetheless is credited with whipping the company's costs and operations into shape before he retired in 2003.

And, of course, Mr. McNerney, who left G.E. to run 3M at the same time that Mr. Nardelli left for Home Depot, got 3M's sales and stock price way up. He recently left to head Boeing, and most analysts expect him to do well there, too.

The success stories, experts say, have several things in common: The companies were manufacturers that needed to cut costs, pump up product innovation and grow by acquisition -- all skills that are finely honed at G.E. In contrast, Albertson's and Home Depot are retailers, an area that G.E. has not touched save for a brief and unrewarding stint owning Montgomery Ward.

SPX needed to expand businesses it already owned -- something that was emphasized far less by Mr. Welch than it is by Mr. Immelt, G.E.'s current chief. And Conseco was foundering -- a company G.E. would never have bought, and probably would have sold.

''The errors come in when G.E. people feel they learned all the secrets at G.E.,'' said Ms.. Wiesenfeld of New York University. They become enamored of their own knowledge, she added, ''and don't feel they have to learn about the business they are going into.''

Mr. Immelt, G.E.'s current chief, has not been cheered by shareholders throughout much of his tenure. He took over from Mr. Welch in September 2001, just in time for the terrorist attack of Sept. 11 to wreak havoc with G.E. insurance, aircraft leasing and other businesses. And he also suffered through two years of share price stagnation, which ended just last month.

Shareholders did not clamor for his resignation, though. One reason, analysts say, was that Mr. Immelt seemed to understand the problems, and was installing innovation processes and product lines to fix them.

Another reason was that his total compensation package -- $8,534,829 in 2004 and $3,400,769 million in 2005 -- was well below the sums paid to other chief executives like Mr. Nardelli.

URL: http://www.nytimes.com
SUBJECT: EXECUTIVE MOVES (90%); BOARDS OF DIRECTORS (90%); COMPANY STRATEGY (89%); EDUCATION (89%); TEACHING & TEACHERS (89%); MANAGEMENT THEORY (78%); RETAILERS (78%); ACADEMIC TENURE (75%); QUALITY CONTROL (70%); SALES FORCE (68%); COLLEGE & UNIVERSITY PROFESSORS (75%); BUSINESS EDUCATION (89%) Bankruptcies; Biographical Information; Appointments and Executive Changes; Suspensions, Dismissals and Resignations
COMPANY: GENERAL ELECTRIC CO (58%); BOEING CO (55%); HOME DEPOT INC (86%)
ORGANIZATION: General Electric Co; Home Depot Inc; Albertson's Inc; Conseco Inc; General Electric Co
TICKER: GNEA (AMS) (58%); GNE (PAR) (58%); GEC (LSE) (58%); GE (NYSE) (58%); BOE (LSE) (55%); BAB (BRU) (55%); BA (NYSE) (55%); 7661 (TSE) (55%); GEB (BRU) (58%); HD (NYSE) (86%)
INDUSTRY: NAICS336412 AIRCRAFT ENGINE & ENGINE PARTS MANUFACTURING (58%); NAICS335222 HOUSEHOLD REFRIGERATOR & HOME FREEZER MANUFACTURING (58%); NAICS335211 ELECTRIC HOUSEWARES & HOUSEHOLD FAN MANUFACTURING (58%); SIC3724 AIRCRAFT ENGINES & ENGINE PARTS (58%); SIC3634 ELECTRIC HOUSEWARES & FANS (58%); NAICS336414 GUIDED MISSILE & SPACE VEHICLE MANUFACTURING (55%); NAICS336411 AIRCRAFT MANUFACTURING (55%); SIC3761 GUIDED MISSILES & SPACE VEHICLES (55%); NAICS444120 PAINT & WALLPAPER STORES (86%); NAICS444110 HOME CENTERS (86%)
PERSON: BOB NARDELLI (93%); JEFFREY IMMELT (91%); JACK WELCH (72%); JAMES MCNERNEY (70%) Robert L Nardelli; Lawrence R Johnston; Gary C Wendt; Jeffrey R Immelt; Claudia H Deutsch
GEOGRAPHIC: MICHIGAN, USA (73%) UNITED STATES (73%)
LOAD-DATE: January 4, 2007
LANGUAGE: ENGLISH
GRAPHIC: Photos (Illustration by The New York Times

sources of compensation data: Equilar

Brian Foley & Company)Chart: ''WHERE ARE THEY NOW?''G.E. executives other than John F. Welch Jr. have made names for themselves -- but not always for their successes.Robert L. NardelliThe Home DepotMR. NARDELLI STARTED HIS CAREER at G.E. in 1971, left in 1988 to join the Case Corporation and came back to G.E. in 1991. After missing out on the top job at G.E., he jumped to Home Depot in late 2000. Competition from Lowe's and some strategic missteps weighed on Home Depot shares, but it was his pay package that appears to have led to his ouster. His total compensation, including his exit package: $274 million.W. James Mcnerney Jr.Boeing 3MAN 18-YEAR G.E. VETERAN, Mr. McNerney was one of the candidates to succeed Mr. Welch. Mr. McNerney lost, but immediately jumped to the 3M Corporation, where he raised productivity and its stock price. He moved to Boeing in 2005, and helped lift its share price as well. His total compensation since he left G.E.: $104.8 million.Gary C. WendtConsecoAFTER BUILDING GE CAPITAL SERVICES into a powerhouse, Mr. Wendt was tapped in June 2000 to run Conseco Inc., a troubled insurance and financial services company. Two months after he stepped down in October 2002, Conseco filed for bankruptcy protection. Mr. Wendt's total pay at Conseco: $79.2 million.Jeffrey R. ImmeltGEMR. IMMELT STARTED AT THE COMPANY in 1982. Since taking over as chief executive in 2001, he has sold off lackluster businesses and prodded managers to focus on ''organic'' growth. After being mired in the low to mid $30s for two years, G.E. shares started rising again in December. His total compensation since 2001: $65.5 million.
PUBLICATION-TYPE: Newspaper

Copyright 2007 The New York Times Company

1247 of 1258 DOCUMENTS

The New York Times
January 4, 2007 Thursday

Late Edition - Final

Helping Make the Shift From Combat to Commerce
BYLINE: By GLENN RIFKIN
SECTION: Section C; Column 1; Business/Financial Desk; SMALL BUSINESS; Pg. 7
LENGTH: 1349 words
Coming home from their respective tours of duty in Iraq, John Reid and Alina Gutierrez had never met but they had a lot in common. Both were sergeants in the 42nd Infantry Division of the Army and were deployed in Iraq from autumn 2004 to autumn 2005. And both had a strong interest in running their own businesses when they got home.

Ms. Gutierrez is an owner of a Glass Doctor franchise, and next month, Mr. Reid will open his own Glass Doctor in a neighboring New Jersey county. They are the beneficiaries of an innovative private-sector business plan aimed at encouraging and supporting military veterans.

The Veterans Transition Franchise Initiative, or VetFran, a program sponsored by the International Franchise Association, offers veterans a discount on financing prospective franchises as a way of thanking them for serving the country.

Nearly 200 participating franchise companies provide qualified veterans ''the best deal'' in acquiring a new franchise, a deal not available to other franchise investors, according to Dina Dwyer-Owens, president of the Dwyer Group, a franchise organization in Waco, Tex.

Franchises have become an increasingly appealing route for many would-be entrepreneurs. According to a 2004 study by PricewaterhouseCoopers, franchise businesses employ more than 18 million Americans and generate more than $1.5 trillion, or nearly 10 percent of private-sector economic output. The study noted that there were more than 760,000 franchise businesses in the United States and franchising continues to be a fast-growing business opportunity.

VetFran was conceived by Don Dwyer Sr., Ms. Dwyer-Owens' father, after the Persian Gulf war. When Mr. Dwyer died suddenly in 1994, the VetFran program foundered. After 9/11 and the invasion of Afghanistan, Ms. Dwyer-Owens decided that the program ought to be revived and, in 2002, she turned it over to the franchise association.

VetFran is open to all veterans, not just those returning from Afghanistan and Iraq. Since the program began, more than 600 veterans have received discounts in starting franchise businesses. Among the participating franchise companies are Dunkin' Donuts, Midas, the UPS Store, Gold's Gym and Aamco Transmissions.

Ms. Gutierrez, 26, said she received a 10 percent discount on her Glass Doctor franchise fee, which saved her several thousand dollars in much-needed capital for her outlet in Mercer County. But as with Mr. Reid and other veterans who have participated in the VetFran program, the money was not as significant as the meaning of the gesture.

''I was very excited when I heard about the program,'' Ms. Gutierrez said. ''When you come home from your deployment, you are not sure if everyone appreciated what you had done. I thought it was very cool that they recognized that we risked our lives in Iraq and they appreciated our sacrifice.''

Mr. Reid, who views Ms. Gutierrez as a colleague, not a competitor, said that the VetFran discount was a big influence on his decision to pursue a Glass Doctor franchise. ''The less capital you have to lay out, the better,'' he said. ''You need as much start-up money as you can get.''

He was also impressed that Glass Doctor, one of eight franchise businesses owned and operated by the Dwyer Group, was willing to be flexible with his deal, offering him an additional four months before he has to start repayments.

Because of their military training, returning veterans are highly regarded as prospective franchise operators by franchise companies. As with the military, successful franchises operate within a specific system and a set of guidelines, created by the franchiser.

''Someone coming back from the military is a great fit for a franchise business,'' said Jim Blasingame, a small-business consultant and host of the ''The Small Business Advocate Show'' on radio. ''They not only know what it's like to work hard but they know how to operate within a system. With a franchise, you can't think outside the box. You have to color inside the lines.''

The military is apparently good training for all types of entrepreneurs. According to William D. Elmore, associate administrator for veterans business development at the Small Business Administration, there are 25 million veterans in the United States and one in seven of them is successfully self-employed.

''Veterans have the highest rate of successful self-employment of any group of Americans,'' Mr. Elmore said, noting the 14 percent success rate in self-employment. He attributes this success to the discipline and training every soldier acquires during their service. ''There is an enormous resource going into the training and deployment of soldiers and out of that comes a skill set, discipline and worldliness that most citizens don't have at a young age.''

Mr. Reid, 40, says that Iraq gave him an opportunity to save $60,000 while he was deployed and he was intent on using that money to set up his own business. ''As a noncommissioned officer in charge of a logistics section, I was responsible for 45 people,'' he said. All 45 came back. ''So I thought, 'Let's see how I do in business.' ''

His Glass Doctor franchise in Somerset, N.J., which is set to open Feb. 5, gives him exclusive rights to all of Somerset County. ''They told me, 'We have a system. If you follow it, you'll be successful.' That sounded like the business for me,'' he said.

The VetFran program is allowing Brett Cooper to start a Lawn Doctor franchise in Boonville, Mo., while keeping his full-time job as a sales representative for Graybar Electric. As an 18-year member of the Missouri Army National Guard, Mr. Cooper was called up for a tour of duty in Afghanistan in 2004 and spent a year deployed in and around Kabul.

''I looked into a Lawn Doctor franchise six years ago, but I wasn't financially able to do it,'' Mr. Cooper said. ''While I was in Afghanistan, I saved my salary. I'm a major so the pay was very good. and it gave me a cushion. I e-mailed Lawn Doctor from Afghanistan and was made aware of the VetFran program.''

He received a 5 percent discount on his start-up costs for the franchises, which is significant given that Lawn Doctor franchises cost $90,000.

As with other veterans starting franchises, Mr. Cooper does not hesitate to let customers know he is a veteran. ''I've absolutely used my veteran status,'' he said. ''People are very grateful that you have served your country, especially in the current conflict. Doing that kind of service for your country builds trust and respect.''

Ms. Dwyer-Owens is pleased by the response to the VetFran program thus far. ''The veterans are so grateful that we are there to say thanks,'' she said. ''I'm proud of it. There's no government funding. It's all done by private businesses.''

Mr. Elmore praised the VetFran program as a strong private-sector initiative that opened doors for veterans seeking small-business opportunities. He also cautioned that veterans should seek expert advice available through S.B.A. business development centers before signing any agreements (www.sba.gov/vets).

Jerry Pyle, a retired Marine sergeant in Mineola, Fla., is among those who appreciate the VetFran gesture. After a 22-year career in the Marines ended in 1999, Mr. Pyle tried his hand in corporate retail and found himself ill suited to that atmosphere. He began his own business as a handyman and home remodeler and when he moved from South Carolina to central Florida, he heard about the Dream Maker Bath and Kitchen Worldwide franchise, another Dwyer Group company.

''It resonated with me that a corporation would actually take my service to the country into consideration,'' he said. ''It felt like a belated payback for 22 years of service.''

The VetFran program emphasizes that veterans not only make excellent franchisers but employees as well. Mr. Pyle said that he gravitated toward the qualities and values of veterans and all of his five full-time employees are either veterans or wives of veterans. ''Their qualities of teamwork, ethics and enthusiasm make us a better company,'' he said.

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