Sunday, July 17, 2011

The Oatmeal might be on to something

http://theoatmeal.com/comics/airplane_layout
This is a good comparison on how commercial aircraft are currently arranged, verses how they perhaps should be arranged.

Matthew Inman has lots of good stuff over at theoatmeal.com.

Thursday, July 14, 2011

CEO Secrets Released

from CNN Money

How to get paid like a U.S. CEO
July 5, 2011: 10:57 AM ET

While millions are still out of work, U.S. CEOs received a 28% pay raise this past year. A lot of factors are driving the increases. Job performance isn't one of them. By Eleanor Bloxham, contributor


FORTUNE -- Did you get a decent raise last year? How about 28% without having to change jobs, vie for a promotion or outperform your peers?
If you were a CEO of an S&P 500 company last year and your pay only went up 28%, then sorry, but half your peers did better than you.

So with millions out of work, how do U.S. CEOs keep their pay rising in good times and bad? The short answer is an army of support and a few small distinctions.

Here's how it's done.

Step One. Ignore global benchmarks in setting pay.


While outsourcing may be negatively affecting your pay as a non-CEO or your ability to find work, U.S. CEO salaries are soaring in part because of the failure of boards to compare the pay of U.S. CEOs against their global counterparts.
Exxon's (XOM) board, for example, doesn't use other global energy firms when setting their CEO's pay. And Wal-Mart's (WMT) board compares its CEO's pay mainly to CEO pay at other U.S. firms and fails to include no. 2 world retailer Carrefour, no. 3 Metro AG, , or no. 4 Tesco among their benchmark companies.

Why does that have an impact? Recent research by professors Nuno Fernandes, Miguel Ferreira, Pedro Matos, and Kevin Murphy finds that, on average, U.S. CEOs earned double their non-U.S. counterparts between 2003 and 2008. And, adjusting for firm size and industry, U.S. CEOs still earn around 80% more than their non U.S. based peers.

Step Two. Convince your bosses that pay need not be based on your performance.

In fact, they can just ignore performance in setting pay. While we'd all like to have a nickel every time someone said CEO pay is based on the principles of "pay for performance", research by Fernandes and his colleagues shows that U.S. CEOs aren't being paid double their global counterparts because they are doing a fantastic job. (Additional research supports the argument that U.S. CEO pay has little relationship to a CEO's job performance.) So, if it's not to do with performance, what is driving CEO pay upward?

Step Three: Get equity.

The research shows that U.S. CEO pay is higher primarily because U.S. CEOs are awarded high levels of equity compensation, which includes pay in the form of company stock and stock options. But you can't stop there.

Step Four: To make sure the gravy train doesn't stop, get institutional shareholders to believe your equity pay benefits them.

When companies have U.S. institutional owners, boards are more likely to offer high levels of equity compensation (and, in turn, total compensation), the research shows. U.S. institutional owners have pushed for greater equity-based pay based on the assumption that offering pay incentives like stock and stock options boost performance and align pay with performance. That has not been the case, however.

When insiders, rather than institutions, hold more of a company's stock -- for example, in family-owned firms -- "they keep pay down," says Fernandes. There's "better discipline." Insiders do a better job of controlling the CEO than outside institutional owners have, he says.

Step Five: Get an independent committee to determine your pay.

According to the research from Fernandes and Co., regardless of a company's size, higher CEO pay is associated with a board comprised of more independent directors. But isn't it counterintuitive that having more independent directors would lead to higher pay? Perhaps on the surface, yes, but independent directors are likely more attuned to institutional owners' interests.

If U.S. institutional owners want more equity-based pay, which leads to outsized U.S. (versus non U.S.) pay, independent directors are more likely to deliver what they think institutional owners want. The directors are "shielding themselves from [liability] problems" by handing out "higher equity based pay," Fernandes says.
Step Six: Make sure your company is listed in the U.S.

Fernandes says that the U.S. is exporting its pay practices abroad. When non-U.S. firms are traded on U.S. exchanges, the firm's CEO pay gets a boost.
Step Seven: Take advantage of regulation to boost your pay and make the case that your additional pay is in shareholders' best interests. (You are really doing it for them.)

How do you pull this one off? Use regulation and accounting conventions to justify pay increases. For example, in 1993, Congress passed legislation that limited the amount of base executive pay that companies could deduct in their taxes to $1 million. This legislation is often cited as one of the drivers for the rise of CEO incentive pay.

Another driver has been past U.S. accounting conventions related to stock options. In the past, the expense of paying executives with stock options did not have to be included on the company's income statement. This accounting, which made companies' income statements look better because the stock option compensation did not show up as an expense, is often cited as a key contributor to the rise in CEO incentive pay.
Going forward, James Reda, founder and managing director of compensation firm James F. Reda and Associates, predicts that a new Dodd-Frank requirement to include a chart that compares executive pay with performance will be used as yet another "excuse to increase pay" for CEOs at U.S. companies.

"Companies will use this as a rallying cry to increase pay," he says, and they'll be "slicing and dicing the information any way they like." If one performance metric doesn't work, they'll just change the comparison, Reda says. Reda predicts in five years we'll see a doubling of U.S. CEO pay from the current levels.

So those are your seven steps to be paid like a U.S. CEO -- although they may not be so easy to duplicate for the non-CEOs among us. Of course, corporate boards could study other approaches to motivating and rewarding good CEO performance, which does seem to be an issue of concern. A survey released in May by the National Association of Corporate Directors (NACD) with compensation consultants Pearl Meyer & Partners showed that "a total of 33% of respondents … ranked 'the selection of performance goals that align with shareholder value creation' as their top Board issue."
Perhaps institutional owners could also rethink what they want. Has higher equity based pay been worth the money they've spent? What signals do they really want to send?

Higher CEO pay is likely not going to benefit you. It means fewer dollars in the coffers for your raises, no better performance for your company, and more unemployed workers, rather than new hires who could help you with your growing workload.
Maybe it's time for more than a collective sigh. Let's hope the U.S. contagion won't spread too far too fast.

Eleanor Bloxham is CEO of The Value Alliance and Corporate Governance Alliance (http://thevaluealliance.com), a board advisory firm.

Monday, July 11, 2011

What is an "Auto-Pilot?"

Just about every time there is some media coverage about an aircraft, it's usually an accident of some kind. And, in that coverage there is usually the mention of an aircraft's "auto-pilot." I seriously doubt the general public has an understanding of what an auto-pilot is and what it does and doesn't do. Most people think it's an "ON" button that takes over and the pilots are no longer needed.

First, not all aircraft have an auto-pilot. For the most part, any aircraft you fly on as an airline passenger these days, has an auto-pilot(AP). This is not always the case, however, and I'll talk about that a bit later.

The basic reason for an AP: to ease crew workload. Patrick Smith stated in one of his articles, that when you look at any modern flightdeck, there is no "land at nearest airport" button. However, in the eyes of some completely ignorant douchefaces, the AP has made pilots obsolete, and to be an airline pilot is to be paid lots of money for a job that is all automated anyways. Yes, in the same way that Microsoft Windows has removed the need for any career IT personnel.

So, let us get into some facts. There are two basic types of AP, 2 axis and 3 axis. Most of the regional jets have a 2-axis AP. Without getting too technical, it will hold the wings level and even follow some type of lateral course, and hold a set altitude. Nicer, larger planes will have 3-axis APs, which are coupled with auto-throttles and will also follow a vertical track through the air as well. (called VNAV)

When then the AP is on, the pilot is not just sitting back drinking coffee doing nothing. In many cases, the pilot is still very much flying the aircraft. They are doing so through the AP itself by pushing buttons and turning knobs, rather than making control inputs on the yoke directly. In this case, the pilot is not at all being "replaced" by the computer. The computer is merely an extension of the pilot's hands.

When you are just cruising along at high altitude, its very nice to have a computer to hold the wings level and hold altitude. Ever feel really really tired when driving, and when you have your buddy switch with you and start driving, you are all of a sudden awake? That's the workload difference between just watching over things, and actually be constantly analyzing the motion and position of the car, and putting in all the steering and accelerator pedal inputs.

I have flown routes into places like Atlanta, Chicago, and New York, which are some of the busiest airports in the nation. Workload can be very high in these environments. Especially when bad weather is further complicating things. Having an AP to help you out here can be very advantageous as well, since you're attention will be divided among more than a few areas.

The other side of the coin here is that the FAA seems to be pressing the issue that flight crews operate with the AP on damn nearly ALL THE TIME. They want the AP on shortly after take off, and they don't want it off until a few hundred feet from touchdown. For several reasons, this is a bad idea in terms of a mandate. The AP does lower workload in most scenarios. However, not all scenarios are made easier by AP usage. Visual approaches are a great first example.

During a visual approach, a pilot will be simultaneously slowing the aircraft, banking the aircraft, and pitching the nose over. This is easily done all together when hand flying the aircraft. To do this with the AP, you will be doing three different things, having to use multiple sets of knobs and buttons. You might be selecting a heading mode, then turning a heading knob, then selecting a vertical mode, and setting it with a knob, and then you might be pulling the power back as well, to control your airspeed, or selecting a speed with a knob for a 3-axis AP. Oh, and you then might be arming and tuning and approach mode to back up the visual approach. And in doing so, you're spending a lot of time looking inside when you are in a congested terminal area. Does that sound like a lot of work? You would be correct! It is.

To explain this in a different way, think about driving your car with an AP. Think about driving down a highway, unable to just seamlessly change your speed with the accelerator pedal, and smoothly point the front of the car where you want to go with the steering wheel. Instead you have a button to select if you want your car to maintain a certain speed, or if you want to set up a constant acceleration or deceleration. Then, you have a knob that you can set it with, say, "60MPH." Then, to steer, you have to select the correct mode on your control panel, to change the direction of the car, and then a knob to actually tune in what direction you want.

Lets also consider arming a NAV mode like having your car AP follow a GPS course that you program in. Sounds great. However, there are still things like stop signs, speed limits, and traffic lights to content with, not to mention other traffic! The GPS unit doesn't know about these things. So, just telling your car to go to the shops, and sitting back with your coffee, is asking for some trouble. You need to be aware of everything that is still happening around you. Not to mention, it takes you, the driver, the understanding and knowledge to program the GPS with the correct routing in the first place!

Here's another reason its bad that the FAA wants the AP engaged at all times. In airline flying, there is something called, "a deferral." This happens quite a lot, actually. Way more often than you would ever think. Why is this? Well, honestly, its based on money. There is a large amount of items and systems on an aircraft that have been deemed not 100% necessary. The FAA allows the company to still operate this aircraft, carrying paying passengers, with these systems inoperative. Some of these deferrals have certain procedures for the company and crew to follow when operating the aircraft with these systems being broken, others restrict the aircraft to daytime operations only, etc, etc. It really varies based on what system or systems are inoperative, as you would expect.

Now, there is a scenario called an "RA." This stands for resolution advisory, and basically, this is when two aircraft are on a collision or near-collision course. The aircraft themselves have proximity monitoring systems which will detect this, regardless what the weather and viability is. The FAA mandates that the AP be disconnected, and the evasive maneuver be hand flown. Why? Because the auto pilot will not react in time. Well, it is perfectly legal for an aircraft to be dispatched for a flight with a full load of paying passengers, into crap weather, with the auto pilot deferred. Now, if all pilots are following the FAA's recommendation to only fly with the AP on, we might not quite be as good at handflying as we should be. After all, we are "pilots," right?

Of course, none of this is even touching on just how often a pilot has to override the automation in an aircraft because its doing something unexpected. It could be for a million different reasons why the aircraft doesn't do what it should do, but regardless of the reason, the pilot needs to be vigilant of the plane at all times and not let the airplane do anything unexpected. I have seen aircraft automation do weird things countless times. Sometimes, its because I set something up wrong. (computers are famous for the whole "garbage in, garbage out.") Other times, its a error or failure in the AP itself. Other times, something totally weird happens. No idea why, but the plane just does something totally strange and unexpected. Just like Microsoft Windows does things, usually on a daily basis, that you don't expect.

Either way you slice it, the number of times that I had to "take back" the plane from the AP, and put it back on track, is nearly countless. For someone to make the argument that aircraft accidents are caused by pilot error, and taking the pilot out of the plane will drastically improve air safety, is to reveal their true ignorance and completely ignore the actual underlying causes of these accidents. Don't forget, if the AP does something unexpected and turns the aircraft into a mountain, it's still put down to pilot error, since the pilots (yes, plural!) didn't catch the error and do something about it.

An AP is really just another tool for pilots to use. When used properly, just like electronic engine controls, weather radar, etc, it will help pilots manage tasks and contribute to a safer operation. People who really think an AP removes the need for a human pilot, truly have no idea what they are talking about and are just making noise trying to get attention. Do you think the plane full of survivors on Sully's Airbus that landed in the Hudson would rather be on a plane that was flown solely by a computer? How about Al Haynes' DC-10 that crashed in Sioux City?

Above image from toonpool.com

Wednesday, July 6, 2011

Rollaboard Maintenance


Your first question might be, "What the hell is a rollaboard?" If so, this post might not be for you, but just to clarify, a Rollaboard is the wheeled luggage that a flight crew member will use to carry around all their personal belongings while on a trip. (i.e. shirts, jeans, undies, socks, deodorant, toothbrush, etc, etc, etc.) I believe the term comes from that fact that air crews sometimes will fly on a lot of different airplanes during a multi-day trip. So as they go from plane to plane, they have their stuff and, "roll it aboard."

One of the most common flight crew luggage choices is made by a company called, "Luggage Works." These have been around for a while and have gone through quite a few iterations to become one of the best rollaboards you can have. Especially when flying in the regionals when most planes don't have a place for you to keep your rollaboard in the flightdeck. Some don't even have a place for you to keep your rollaboard in the cabin! Yup, on some regional aircraft, the crew bags ride in the cargo bin just like the passenger bags. The LW bags are very stout. They aren't the lightest bags you will find, and not the cheapest, but they will last better than just about anything else.

I love mine because of its size, its durability, and two other key features that I couldn't find on other bags: a long handle and real roller bearings in the wheels. And, those wheels are placed at the widest possible places for maximum stability. This might not be necessary for people that only fly a couple of times each year, but for people that fly around 250-200 days per year, and considering just how much time is spent pulling it around, its worthwhile to have something top notch.

Well, its been more than few years since mine first entered service. It was in need of some basic maintenance. Others with LW will attest to regular screw-tightening rituals. I have also noticed some screws missing now. So, I decided to put a bit of time and money into this thing. After all, it is my, "Mobile Home."

For those interested in some maintenance on their LW bags, here's a few things I can recommend. The closest match for the external screws that loosen from time to time, are #8 x 5/8" sheet metal screws that can be found at any hardware or home improvement store. A pack of ten screws will run you a buck or two. Also worth noting, the 3 screws along the bottom edge of the front of the frame on the LW, are #8 x 1/4" sheet metal screws. They are the same thread and width as the others, just shorter.

I highly recommend taking 10 mins out of your day to use thread lock all these screws. I use this product from Loctite. Go one by one, around the frame, remove a screw, squirt some of this goo on the threads of the screw, and then screw it back in. (Cordless drill with Philips screwdriver bit exceedingly recommended here.) Keep some paper towels at hand as this loctite stuff can be slightly messy, but it will really assist in those screws not working loose.

My wheels are still in decent shape, but when it comes time to replace those, all it takes is a visit to any rollerblade or sporting goods store as the LW bags use rollerblade wheels and bearings. So, pick whatever you like and you're set to go there.

All in all, I think the LW bag is the best you can have for this career. It's also quite often you see flight crews from all sorts of companies using this bag, so I'm not alone in this opinion. If your interested in one, you can find more info about them at http://www.luggageworksonline.com/.