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Not the Industry we grew up in

I had dinner the other day with a parking buddy. Our wide ranging conversation covered many aspects of the industry. He ended the evening with this statement “This is not the industry we grew up in.”

The next day I got the following. I have edited for clarity.

Just want to make something clear.  When I said it is not the industry we grew up in I had a very specific meaning to that. The industry has had two basic changes.  In 1979 all of my revenue reporting was done by handwritten shift reports filled out by people who never saw high school.  All of the revenue was cash and we did the best we could to get as much as possible to the bank and accounted for.  Today our industry has made tremendous improvements using the latest in electronic development to have instant cloud based reporting and accounting that makes it actually possible to manage revenue, rates, #’s of cars and expenses.

I think this change is great and really makes it exciting to manage.  But, in 1979 we were managing leases where we had to know the business because every decision I made as a 29 year old impacted millions of dollars of rent and expenses.  You just did not survive if you were not a really good manager.  When I joined APCOA in 1988 they were the largest manager of airports in the country.  Today all airports are management accounts, then they were concessions agreements.  In a concessions agreement the parking company bids a % of gross revenue to be paid to the airport and the parking company collected the revenue and paid all of the expenses to manage an airport parking operation.  If you messed up on your % bid the airport did not care, you still had to get the doors open and equipment working at your expense.

Today most of the great managers and leaders that were capable of risking it all everyday are gone.  The cities were all managed by parking companies under similar agreements.  Now the University manager, city managers mostly work for the institution and have no risk.  The commercial managers all manage management accounts where there is no risk in either revenue or expenses.  We have now created a bunch of managers who do not need to know anything.  We went from an industry full of managers that accepted a very high level of risk everyday to an industry full of managers who have no risk.

So when I say it is not the industry we grew up in I am saying that most of the true managers and leaders are gone. The electronics changes are wonderful but I feel there are few that truly understands the numbers.

I’m sure there are some out there that understand the numbers. However to quote the great Thomas Sowell:

It is hard to imagine a more stupid or more dangerous way of making decisions than by putting those decisions in the hands of people who pay no price for being wrong.

JVH

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