This is the post where I am going to offer ideas for turning around the city of Detroit. These are my opinions, and are completely subjective. I absolutely believe that the City of Detroit can comeback. It will not be easy or quick, but it can certainly be done!

Quit Feeling Sorry for ourselves: Time Magazine ran a several stories last fall on Detroit and the problems it is encountering. One theme in the articles is how the great city of Detroit was ravaged by decline of the auto industry, the over-empowerment of the UAW, and “white flight” after the riots of 1967. A common theme for the national media is to look on Detroit and southeastern Michigan with pity, and many in this area soak up the pity and feel sorry for their plight.

Well, all of these things are ancient history. Almost every city in the US had riots in the late 1960s, yet we are the only region that still talks about how great things were before the riots, like we were destined to this fate 42 years ago?

In addition let’s face facts that the auto industry is all but gone from Michigan along with the 100k+ plus jobs for unskilled laborers. Many industries have come and gone from other regions. How much meatpacking still takes place in Chicago? Where is the textile industry?

Our region has great colleges, a nice cool climate, plenty of fresh water, no worries about wildfires, hurricanes, earthquakes or other natural disasters, but we need to stop feeling sorry for ourselves! Few individuals or businesses are going to be attracted to our area until we pull ourselves up by our bootstraps and forget about the assent and descent of this region during the 20th century!

Fire up the bulldozers: Blight is bad! Blight gives crack heads and meth addicts a place to hide and hookers a place to work. If a residence is run down or boarded up, the city needs to foreclose on the property. They need to bulldoze the property and setup a land bank that can clean the title and offer the property for resale later.

As big of a Tiger Fan that I am, I could not in good conscience cry too loud when the City of Detroit cleared the old Tiger Stadium. Yes, there were lots of proposals to revamp the property, and for sure there were probably tons of buildings in worse shape that needed to come down. But one more empty blighted building that is brought down is one less eyesore we have to see and one less crack house the Detroit Police have to bust.

Make people feel safe: No one will move into the city until they feel safe. Detroit has a huge crime problem and unfortunately there is no way to turn it around overnight. What you can do, is take a small section of the city, patrol it like crazy, let word out on the street that the book will be thrown at anyone committing a crime in that area. I have heard from old-timers in Chicago that this is what Daley did in the Michigan Avenue corridor in the early 1970’s. I would start with the Woodward Avenue Corridor.

Build more Public Transportation: For a long time Detroit shunned public transportation because they wanted to promote automobile usage. Because the key to growth in the 21st century for our city does not lie in the auto industry, we need more public transportation. One thing that has been proposed (and just recently got Federal Funding) is the light rail to go down Woodward Avenue. I would build this ASAP and push for it to extend all the way to Birmingham.

Entice Young Professionals to live in the city: We spend a lot of political time, money, and resources trying to help our state schools educate our best young people. Unfortunately, many of these bright students graduate from a Michigan college and promptly leave the state. How do you entice young people to live in the city? Help them pay their student loans. I would institute a program where young people could deduct their student loans amounts from their property taxes.

Fix the Public Schools: In a recent test, DPS (Detroit Public Schools) students posted the worst score in the history of the test. The DPS is dysfunctional. Because of the shrinking population, there are way too many half full schools. DPS needs to undergo a consolidation of buildings. In addition, they need to institute a voucher system within the city so that the DPS can have some competition and those bright students who want a better education can obtain it. Thanks to the state appointing Robert Bobb, a turnaround of DPS has started to happen.

Ethnic Diversity is critical for all parts of SE Michigan: Detroit is 82% black and 10% white, If you go up Woodward avenue and get north of 8 Mile (the border of Detroit), you hit Ferndale which is 90% white and 3% black, the next city north is Royal Oak which is 94% white and less than 2% black, just north of that is Birmingham which is 95% white and less than 1% black!

Something is seriously wrong with this. You have generations of kids in Detroit who rarely see white people in their schools. Conversely, in many Oakland County Schools, a black person is a rarity.  Meanwhile, Chicago is 37% Black, 31% White, and 26% Latino which is a good balanced mix. How do you fix this? I am not sure, but it is the toughest and most important issue on this list. Personally I would like to see the religious leaders of both groups get together to address this issue. People in this region need to realize that just because we have different skin tones; it does not make us opponents.

I love Michigan, I love Detroit, and I hope someday my children will be proud to not only say I am from Detroit, but I live in Detroit and it is a great place to be!

Having now spent the majority of my life in the Midwest, I can say that I am proud to be associated with the region. People in the Midwest have grit. They are not narcissistic and their family is the most important thing in their life. Two cities that display the Midwestern persona are Chicago and Detroit.

Separated by only 4 hours across I-94, the cities are worlds apart. According to www.city-data.com, using 2007 statistics, Chicago has an average income of $45,505 while Detroit is $28,097. Chicago has an average home price of $286,800 while Detroit is $100,351. 33.8% of Detroit lives in poverty compared to 20.5% for Chicago.  The murder rate per 100,000 in Detroit has averaged 41 over the last 10 years, more than twice the rate in Chicago (19).

With this post and my next one I am going to compare Detroit and Chicago, two cities that at one time were similar, but have since grown very much apart. I am going to highlight some of the problems I see with the City of Detroit and the Southeastern Michigan as a whole. I am going to break up my analysis into two posts, because I have many opinions on the subject.  I will apologize now if I offend anyone, please understand that these are only my personal opinions.

Let’s explore the population of each city. Today Chicago has a population of 2,853,000 people (density of 12,569/sq-mi), and Detroit has a population of 912,000 (density of 6,378/sq-mi). Each city reached their peak population in 1950 before the birth of suburbs. Since 1950, Chicago has lost 21% of its population while Detroit has lost a staggering 51%.

Historical Population Density 

As you can see from the chart above between 1950-1990 Detroit and Chicago experienced similar population loses, but since 1990 Chicago has actually added resident since 1990 (+2%), while Detroit has continued in a death spiral(-11%). The death spiral will not turn around anytime soon as new construction single family permits over the last 12 years have averaged 175 per year in Detroit and 1,000 in Chicago.

It’s NOT Jobs within the City?

From 1990 – 2000 Chicago workers LOST close to 70,000 jobs within the city while Detroit workers lost a lower percentage and only 15,000 jobs. Yet the population of Chicago grew by 2%, while the population of Detroit shrunk by 11%. The reason for this phenomenon is that many more Chicago workers are now commuting from the city to a job in the suburbs.

I am reminded of my niece, Allison, who lives in downtown San Francisco near the baseball stadium, yet works for HP about 45 minutes away in the suburbs. Like many young urban professionals she and her fiance enjoy living in an urban setting, have no kids, and do not have time to worry about the upkeep of a house. They can walk or take a cab to a local restaurant and do not have to worry about the legal consequences of having to return home if they have a couple of adult beverages.

My niece Allison’s story would be rare for Detroit. Very few young professionals live in the city. The people in the suburbs only go to Detroit to see a ball game, show, or visit a casino. Young professionals, like my niece who has an engineering degree from Michigan State, are leaving this region in droves.

I grew up in the Baltimore-Washington Suburbs and have through my business travelled to most of the major cities in this country. I can tell you I have never been to an area as dysfunctional as Southeastern Michigan. The City of Detroit and the Suburbs surrounding it do nothing but bicker with each other.

There is so much distrust for the suburbs that a suburbanite, Robert  Thompson, who was educated in Detroit, was going to donate $200 million dollars to the Detroit Public Schools was told to get lost because he wanted too much control of how his money was going to get spent. More recently, this region almost lost its last showpiece event, The North American Auto Show,  when the city fought with the suburbs and state over the much needed redevelopment of the Cobo Center.

I know many of my neighbors in the suburbs, would like to forget about the city of Detroit. But, the city is the heart of this area. Like a human being cannot live without a heart, this region cannot survive without a healthy city of Detroit. It takes my suburban neighbors working with the city, not being elitist. 

Most importantly, it will take leadership in the city government that accepts responsibility, creates a safe atmosphere, and encourages immigration. I love this area, and I sincerely hope in my lifetime we can see a renaissance in Detroit. But hope is not a strategy, so in my next post, I am going to offer some ideas I have on the issue.

Ed Nicholson Jr. (John T. Greilick / The Detroit News)

Shortly before the 1965 baseball season, “Fast” Eddy Nicholson used a connection to get a job as an usher for the Tigers. His first day on the job was opening day, April 21, 1965. The Tigers defeated the Kansas City A’s 1-0 behind the stellar pitching of Hank Aguirre.

Since 1996, Eddy’s affiliation with the Tigers has not been limited to Comerica Park. When Eddy retired from his full time job at Grand Trunk Railway, he and his wife started wintering in Florida and Eddy started working the third base gate at Joker Marchant Stadium during the Tiger’s spring training.

He has many fond memories of his 45 years with the Tigers including 2 All Star Games (1971 and 2005), 2 World Championships (1968 and 1984) and the improbable 2006 Pennant.  His favorite and most emotional memory came on September 27, 1999 when the Tigers said good bye to Tiger Stadium, their home since 1912. Eddy revealed that he could not hold back the tears when the former players took the field during the post game tribute.

I have had the pleasure of sitting in Fast Eddy’s section 132 for the past eight seasons. One particularly hot day, a young girl near us suffered a heat stroke. Eddy went into action and handle the situation flawlessly.

I am sure that his wife, five sons, and fourteen grand children are quite proud of Eddy’s class service to the Tigers. Eddy will regrettably become the Sr. Usher for the Tiger’s this year, as his friend and fellow usher, Dennis Kilpatrick, passed away in February. When you come to Comerica Park this summer, stop by and say hi to Eddy.

 Always nice to get a little postitive press.

http://www.metromodemedia.com/innovationnews/pattiengineering0107.aspx

Patti Engineering goes from 25 to 33 people in 2 years

I am pretty proud of the fact that Patti Engineering was recently published in Control Engineering Magazine. The article is about an automated system we did for Ancor in Troy, Michigan. The system packages Federally Mandated Vehicle Information Labels for all Ford Vehicles sold in North America. You can check the article out yourself:

http://www.controleng.com/article/CA6620339.html

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In May 2006, I first heard Alan Beaulieu speak at the annual Control Systems Integrators Association (CSIA) conference. During the Florida-based conference, Alan remarked that the nation was in a one-state recession, and jokingly advised those from Michigan not to return home. That drew a hearty laugh from my fellow integrators and a couple of teasing smiles my way. I have since become a big fan of Alan’s and would recommend that business owners subscribe to his monthly analysis newsletter (www.ecotrends.org).

Beaulieu predicted back then that the rest of the country would join Michigan in a recession in 2008 and that it would be a pretty deep one – unlike any in the past 30 years. True to his prediction, the country has joined Michigan in the recession and there seems to be a reaction of panic across the nation. Beaulieu also has said that if you think 2008 is bad, wait until you experience 2009!

The politicians in Washington think that if they throw enough money at the financial industry, the recession will go away. Again according to Beaulieu, their moves will only act to prolong the downturn and hamper our children with a debt that they will have a hard time repaying.

Having seven years of experience with a recession, here are my tips on how you can cope with it:

• Do not feel sorry for yourself! Your business can be nimble enough to survive the downturn and even prosper. Many of your competitors will go away. With the banking industry being so tight, there is very little capital for startups. When the economy turns around (and it will) you will be ready!
• Do not look at your 401(k) and/or IRA statements. They will only depress you. If you have not moved them to cash yet, you are probably too late.
• Keep making your monthly mortgage payments and do not think about the shrinking equity in your house. Housing lead the recession in and prices have probably hit the bottom.
• If you own a business, be very careful who you work for. Nothing is more brutal for your business then to have a big collectable for a customer who claims Chapter-11, which ensures you only pennies on the dollar. Get as much money up front and give companies on shaky ground to your competitors.
• Do not skimp on sales and marketing. It is even more important in bad times to get in front of existing and potential customers.
• Do not listen to the mainstream media. The economy will come back. According to Beaulieu, mid-2010 will bring new signs of economic growth. He is very positive about America’s prospects over the next 40 years and I couldn’t agree with him more.

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A great man passed from the earth on a dreary Tuesday Morning. Donald Eugene (Ducky) Fridline was a tremendous family man. Marrying his baby daughter, Patti, I consider myself very lucky to know Ducky the past 20 years.

Ducky was born on the East Side of Flint in 1929 and raised in a tiny house on Maryland Avenue. One of 10 Children, they stayed very close throughout their lives, all settling in the Flint Area. One brother, Herb, was killed in a Motorcycle accident at age 18. The other five brothers all served in the US military, Ducky spending his time as a Navy Corpsman. Now that Ducky has passed, only two of the ten children are still alive. 

Ducky returned from the Navy in 1952 and married Jeanie. He got a job at Buick City and she at AC. They bought a house on the East Side of Flint in 1955 having two small boys at the time. They ended up having eight children in all. They worked different shifts so that they could handle the day care and raised all of the kids in the house which was not bigger than 1000 square feet.

An Avid Hunter, Ducky bought a large parcel near Manton, MI in 1970. Nicknamed “Bugatussle,” it became Ducky’s favorite place in the world. The small cabin that was built shortly after the purchase grew with many additions to a place were over 20 could sleep comfortably.  Hunting, exploring, riding ATV’s and enjoying the 80 acres became a passion for Ducky, his friends, and family.

Ducky faced several challenges in his life, and approached them all with vigor. He did not graduate high school in his youth, but went to adult education to get his diploma well after his 50th birthday.  A smoker for years, he had his last cigarette in 1987 when a major stroke came close to killing him. The stroke left him permanently disabled as he lost use of his right hand and would drag his right extremities for the rest of his life. In 1990 Ducky would battle and survive Prostate Cancer.

In 2001, the love of his life, Jeanie, passed away after a long illness. I and most of those close to Ducky, thought there was no way that he would be able to live on his own. He proved us all wrong, taking care of himself and doing tasks that he hadn’t done since his stroke. He was determined that he would not need assisted living, and he didn’t.

After having worsening back pain, Ducky was diagnosed with bone cancer in late June. After battling for a while, he entered the wonderful Avalon Hospice facility on September 23rd. Ducky told his children not to feel sorry for him, he had a great life and everyone was going to die at some point.  

Ducky, you did live a great life, and your legacy will live on for a long time. You made those closest to you better with the example you set. You will be missed.

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I am a season ticket holder for the Tigers and love to give our employees and customers the opportunity to take in a game. I also love the sport myself. As a geek, I can study baseball statistics until my head spins, but so much of the game cannot be explained statistically. So much of winning and losing comes down to the details (good defense, throwing out a runner at home, taking an extra base in a key situation).

Paying attention to details is what separates the great organizations. That pertains to baseball and it pertains to business. Dave Dombrowski, president and CEO of the Detroit Tigers, is a leader who makes sure that his organization pays attention to the details. I have an interesting story that highlights what kind of organization he runs.

I sent the following e-mail to Dave Dombrowski last July 9th:

Dave, My name is Sam Hoff, I have had season tickets for the last 10 years. I really enjoy having access to the Tiger Club and the Tiger Den Lounge. There are some great pictures from the Tigers Past on the South Wall of the Tiger Den Lounge. Unfortunately there is no way to identify the pictures on this wall. I recognize Ty Cobb and Hank Greenberg, but beyond that I am pretty well lost. I am sure most people who attend the park are even more lost than me. I have a couple of questions:

• Are there presently any plans to put identifiers on these pictures?
• If there are no plans, would you support it if I helped to organize an effort to do this?
• Do you have any contacts at the Mayo Smith Society, or other Historians who would be a good resource for such an effort?

Much to my surprise, he answered the e-mail the same day:

Thank you for the note and comments. Presently, there have been no plans to put the names on the pictures. However, we will be glad to review the request and see if we can make this happen.
 

The fact that he actually answered my e-mail was a shock. The bigger shock was when I arrived at the park Monday for Tigers’ Opening Day and noticed that every picture along the south wall of the Tiger Den Lounge had a professionally engraved placard noting the player’s name as well as the years he played for the Tigers.

One person outside his organization came up with an idea and mentioned it once. He obviously reviewed it within his organization and figured it was a worthwhile idea and got it done. Hats off to Dave Dombrowski, he obviously would be successful in whatever organization he ran. Hopefully, his organization (and the City of Detroit) is rewarded with a world championship in the near future.

I have not been able to verify this quotation. According to a good source, Bo Anderson, General Motors’ Vice President, Global Purchasing and Supply Chain, has said that he likes it when a supplier goes out of business as it shows him that he is getting the lowest price possible. I kind of hope my source is wrong. Because if it is true, what an arrogant and stupid thing to say.

GM, Ford, and Chrysler’s corporate headquarters are within 30 miles of my office. They used to be called the “Big 3,” but since their combined US market share fell below 50% for the first time last August, the “Detroit 3″ seems like the proper moniker.

I worked for GM for six years and have many family and friends employed by the “Detroit 3″ in labor and management positions. Through Patti Engineering, I also have managed various projects in most of the automotive assembly plants in the US (both foreign and domestic nameplate).

So what is the problem? Many people point to high US labor costs and the fact that vehicles can be built cheaper overseas. I don’t buy into that. If that were the case, why do Toyota, Honda, and Nissan build nearly 80% of their US cars domestically?? Shipping cost and distribution logistics cause another set of headaches when producing in foreign countries. I also have observed that American workers are smarter and more efficient than their foreign counter-parts.

In my opinion the problem with the “Detroit 3″ comes from their corporate culture which lends itself to adversarial relationships. These relationships are found in 3 different areas:

An Adversarial Relationship between Management and Labor: The UAW has been fighting for years to get into the Honda and Toyota Plants. They have been unsuccessful so far. Most workers I have dealt with in these facilities see no need for the UAW. They get good pay, great benefits (onsite daycare, a world class workout facility) and are very happy. I can write a whole another post on the pros and cons of the UAW (and may someday), but needless to say the relationship between the UAW and Detroit has a history of being tense and adversarial. The last UAW contract was more sane than recent contracts and provides hope that the “Detroit 3″ and the UAW realize that they need to work together to ensure both of their survivals.

An Adversarial Relationship between Different Departments: There are too many turf wars that take place inside the “Detroit 3.” When working with the Detroit 3 you see this first hand. There are lots of grey areas as to who the decision maker is in regards to your project execution. As a vendor, you better be SURE to get any decision in writing as another department will later come by, flex their muscles, and force you to make a change. Working with a transplant, you do not get this at all. There is one person who is empowered to make all of the final decisions for that particular (though he will get input from different departments). It saves a lot of change orders.

I have also observed first hand where a really valuable employee will never be promoted. His supervisor realizes his importance to the department and does everything possible to hold onto him. As less qualified and talented people get promoted to other departments, the talented employee may become apathetic, burnt out, or leave the company.

Consolidation of like groups has been taking place and needs to continue to take place. GM no longer has a BOC, CPC, and Truck & Bus controls group, but instead has one group called CCRW (Conveyor, Controls, Robotics, and Welding).

An Adversarial Relationship with Vendors: When I worked at GM, the superintendent of my department used to have vendors take him to dinner and he would order two lobster dinners for himself and one to go for his wife. Working for GM, we figured vendors would only answer “how high” when we told them to “jump.”

This type of abuse is mild compared to the wringer that the “Detroit 3″ now puts their suppliers through. Too often the suppliers readily line up and take a program thinking that volume will make up for tight profit margins. When that volume never comes, or raw material prices go up, the supplier is in trouble. Bo Anderson, and his counterparts at Ford and Chrysler, will not give any relief to the vendor and another company such as Plastech is in Chapter 11.

Guardian Industries, privately owned by Bill Davidson, has continued to make money as an automotive supplier in these tough times. How have they done it? A good friend of mine, Michael Caruso, once sent me an article about Bill Davidson where he answered that question by stating “we have learned to say ‘no’ to our customers.” By that, he meant that he will not go along with unfair customer demands. It is a lesson a lot of suppliers should take to heart.

Conclusion: Can things be turned around? There is lots of talent in these companies, and you can sometimes see glimmers of hope such as the 2007 UAW agreement and the recent success of the Cadillac nameplate. If one of the “Detroit 3″ has a talented leader rise to the top then a great comeback will happen. That leader will change the corporate culture of the “Detroit 3.” He will have to implement:

• Open, honest communications on all fronts.
• Stress innovation in the products.
• Make purchasing a lieutenant rather than a captain.
• Develop win/win relationships with a select group of key vendors.
• Foster and grow the talented personal that the company already employees. 

Everett Kircher bought 40 acres near Boyne Falls, Michigan in 1947. The person who sold Kircher the land laughed at the idea of building a Ski Resort in such a remote location and hence gave him the land for $1. The Resort, known today as Boyne Mountain, was the first resort in the Midwest to have a chair lift. Kircher eventually made money off of several patents for chair lifts and snow making/grooming equipment. In 1964, Kircher bought a 2nd ski resort, known then as Harbor Highlands and renamed to Boyne Highlands.

Boyne Mountain was the first Ski Lodge in the Midwest to offer golf, a course that Kircher built himself. For Boyne Highlands, Kircher hired Robert Trent Jones, Sr. to build the “Heather” which opened in 1967.  The Heather is presently ranked #70 on the list of Golfweek Magazine’s “Top 100 Resort Courses.”

The Heather is a little over 7,000 yards from the Tips and slopes at 141. The finishing hole is a terrific challenge. Playing at 451 yards, and going downhill from the tee to a pond, a long drive from the tee can reach the water. You are going to be left with at least a 160 yard shot over nothing but water going for the green on your 2nd shot. Bailout position is to the left.

Each May I go on an annual golf outing “Up North” with anywhere from 28-40 people. We call it the “Long John” golf outing as we have had to wear “Long Johns” because of the widely varying temperatures in early May. For 7 years in a row we went to Boyne Highlands and always had our last round at the Heather. For the first six years I put one in the drink as a bunch of drunk golf buddies were jeering from the behind the green on #18. I am happy to report, the last time I played the Heather, I was the only one in my group to hit the green, landing one 20 feet from the cup as our group went on to a par, winning the annual outing.