April Follies: Running With Risk

For the All Fool’s Day holiday, take a moment to look back at the recent and even distant past mishaps that could have been larger leaders. The difference between FriendFeed, MySpace and Facebook is measured in many billions of dollars in revenue.

Coffee for $5 a Cup?
Kraft Foods had hundreds of thousands of dollars invested in research showing that the North American market was ready for neighborhood cafes, but they didn’t jump on it because they are used to being in the food business. Instead of selling products for delivery into neighborhood stores and grocers, they shied away from investing in opening corner coffee shops in every American city from coast to coast. The result: Starbucks ate their lunch.

Rand McNally
How on earth did you miss the boat on internet mapping? Because it wasn’t a priority. The firm that used to be the only name in maps of the roads and cities of North America became a sideline to companies with a dotcom in their moniker. They have since retooled and now offer a great amount of their data in GPS applications, as well as in the new version of their website where the user can receive travel packages related to directions searching. Late to the game, but points for making headway after missing the boat on the first wave.

MF Global
If you want to take a firm with a reputation approaching 300 years of solid, profitable business, and completely demolish it, what is the easiest way? Betting on short-term gains in the high risk, high reward casino we call European debt. After an amazing run since the 1700s beginning with the sugar trade, MF Global had positioned itself as a focused, conservative company for financial gains, selling in the world’s market. Somehow this all unraveled in a matter of weeks as the European currency crash and debt crises in Greece, Italy and Spain caused deep discounting. MF Global was still shopping for a buyer to bail its way out of a $6.25 million bet on the situation.

Spread Too Thin

While some corporate choices lead us down a garden path to delightful gains, some journeys can delay growth as an organization. Worse still, some decisions can sink the entire ship by sapping energy and resources from an enterprise’s core competency.

Too Big to Succeed?
In initial drafts of this post, I struggled with the conflict of how much I love using Google Search, Google Maps, and a variety of other Google products with the difficulty I was experiencing with Google Apps, a platform of services including Google Docs services like word processing, spreadsheets, and Google’s GMail for business email service. I found the extremely low per-user fee charged to businesses using Google Apps and free availability of some services to be at odds with professional use when support is required; for a period of time last year, the spreadsheet service was completely unavailable for edits or uploads. However, I was wrong. My thesis was planned to be “Spread Too Thin,” based on the idea that by taking on so many tasks, and by becoming a Jack of All Trades, Google might become the anecdotal Master of None.

I Stand Corrected
While complaining about services which in some cases are completely developed to compete with existing models (maps.google.com is now in many ways better than the MapQuest.com who dominated the market years ago, or launching Google+ to integrate social networking directly into the Google suite and in effect take on Facebook and Twitter), I underestimated the work that appears to go into this kind of Google growth. The leverage of large monopolies is always fraught with peril, because if a firm becomes too large and exerts its own girth in order to control the market, it runs the risk of competing unfairly. But looking at this in-depth, Google appears to target large opportunities, in fact bringing its considerable cannons to bear only on sizable markets, even when they appear unrelated to existing lines of Google business. When a small company is achieving remarkable growth, as in the case of Groupon.com, Google makes all efforts to acquire the firm and acquire the intellectual property, only competing when required.

Redux
I now consider the progress made on new and exciting (sometimes seemingly unrelated) fronts for Google to be not only what is currently called “creative destruction” or constructing “disruptive technology” but better still, the achievement of Google’s mission: to organize the world’s information and make it universally accessible and useful. It’s a win because they succeed far more often than they fail.

From $4 A Share To $404: How Apple Succeeded

This is a post I have been planning for some time. It’s important because of the way Apple has made their fortune over the last four decades. I’m not going to begin discussing solid supply-chain economics, a lesson they learned in the 1980s era when manufacturing crashes and industrial  firms were all playing catch-up to “Kaizen” and “Just-in-time” strategy. I won’t delve into the recent Apple cash management victories, with solid debt principles, product launch timing and an $80+ billion war chest. I’m not even going to wax poetic about the incredible mind that was Steve Jobs, and how we miss him. These are all true, but they’re not the real story.

I’m going to draw your attention to Time Machine. This simple innovation is exactly how Apple Computer beat the bigs. It’s how a group of guys and girls from simple beginnings got to become that American fable of building a better mousetrap, founding a company in the “garage” and going on to superstardom and independent wealth.

Time Machine is the story of how something people do regularly with computers became simple, without technology innovation (although that followed) but simply with an analogy.

In the 1970s, 1980s, 1990s, and early 2000s, backing up files from a personal computer, or network of computers, was an ugly endeavor. Leading vendors offered great leaps forward in storage capacity: Terabytes of information could be saved to tape, disc, or off-site server farms. The problem was, no matter how often you remembered to back up, or automated the process, it was a technical nightmare. Special interfaces were required, and the media you saved to had to be labeled, catalogued and libraried. This sounds like it could be an orderly process, but the devil wasn’t in the details. It was in the one time you needed to restore from backup. This almost never worked.

It wasn’t the users that failed this, or the sysops who were tasked with the backups, or even the companies like Iron Mountain or Western Digital that were providing the highly complex data solutions. It was the system itself. People had to determine which of the last 2 or 3 backups had the version of their files, and often one of those hadn’t run right, so restoring from saved versions just didn’t match up, and could take hours or days in larger organizations.

Apple defeated this problem with an analogy. Instead of making users bend to a complicated catalogue system, they changed the inner workings of their technology to a simple mental understanding. By giving users an in-operating system dial to “travel back in time” to see what files were in a folder, Apple made this easy. It is this same understanding of what users want that forces them to test, test, and test again the methods for user interface in their iPhone, iPod, iPad, and computers. There is plenty of highly technical custom possibility beneath the surface, but for most users, Apple makes it easy on us. If you shake the iPhone when iTunes is open, you get a random playlist. This is something humans understand, without needing to “learn” the interface.

Can we take a step back from our own daily walk and ask, “what do the customers want?”

That’s when we can really break through our own pattern.

Sure, We Know What Makes a Man, But What Can You Do About It?

Spies who don’t brag.

Players who don’t kiss and tell.

These are the fabric that make up our world of winners.

Anachronisms. People who matter. Those who follow the rules, not the nancypants playtime discussions of what we learned in school, whether you go to a strip club on someone’s bachelor(ette) party or not, whether you hold the door open for a little old lady. Let’s talk about the rules of the game, the rules of engagement, the rules of war. Remember all’s fair in love and war?

Bobby Green, Jr., was a guy living in Los Angeles when the 1992 riots erupted in the days after the Rodney King verdict was announced. He woke up that morning in a culture of violence, and like it didn’t matter to him, he found himself watching on television, on CNN no less, as down the street, an intersection he knew was on-camera. People were burning cars. Guys were hitting other guys with baseball bats. Somewhere in the distance, there were gunshots. Then, on TV, Bobby saw some white bread truck driver pulled from the cab of his rig. He saw, live on CNN, someone hitting the trucker, a guy it turns out was named Reginald Denny, with a cinder block. You know, a 40+ pound block made of concrete? They were hitting him with one. In the head. Bobby follows the rules. This doesn’t happen. It just doesn’t. He left the safety of his house and went down the street, in the chaos and the mayhem, raced to the corner and intervened. Stopped the madness. Took Reginald to the hospital. Because that’s what you do.

Captain Chesley Sullenberger the Third is a regular hero. He’s the pilot who got up on January 15, 2009, days before the Obama inauguration, the country still reeling from the financial meltdown, unsure of his pension, his paycheck, his future, but secure in the sense that he follows procedure and work gets done. This isn’t a Captain in the sense that he is in charge of the airplane when it’s in the air, and some flight attendant does a sloppy salute and calls him “Skipper”. This is a Captain who graduated from the US Air Force Academy when planes were dogfighting over Viet Nam. This is a Captain who flew F4 Phantoms and followed procedure, no matter how hot the spot got. He launched his US Airways passenger flight from La Guardia airport and didn’t wet his pants when an engine blew out, when the plane dropped in a way he later described as “the worst sickening, pit-of-your-stomach, falling-through-the-floor feeling,” it didn’t stop him from following the rules. He realized the plane wouldn’t make it to a runway in time, and he was over the planet’s most populous city. He did it right. He ditched the plane in the Hudson River and miraculously, everyone lived. Even the little children.

Narces Benoit is a story we are only just learning. The video speaks for itself, and the reality is something that will eke its way out in the trials to come. The man saw some loco gunfight happening in front of him in Miami, and it doesn’t matter if the police were justified to shoot a man. You already learned right from wrong and you know no one in America, not one person in the United States, has the right to hide the truth. So when the cops murder someone directly in front of you, and you capture the video on camera…. You are doing what is right. But when the cops point the gun at you, and demand you give up the footage? When the patrolmen take away everyone’s cell phones and stomp on them like a gang from some 1980s sci-fi movie, you already know the rules are blurring. Narces sat through an arrest. He sat through questioning. He had a policeman’s handgun pointed in his face. Through the whole of it, he had his SD memory card in his mouth to keep the truth safe from the machine. Was he rattled? Probably. Did he give up the chip; spit it out so they could crunch it like a mobile phone under a government-issue boot? No. Because them’s the rules.

Why are these men the triumvirate of heroes? Because each of these guys, they didn’t have to question right from wrong. They know the rules. They follow the rules. You know it too.

The reason you lump these three men together is simple.

It’s got nothing to do with honor; it’s got nothing to do with respect. They have that. They earned it, or maybe they always had it and by their actions they demonstrated the right. You put them in one group not because they are who you aim to be. You put them together because if you are ever, and I mean ever, in a bar, and any of them are in a bar with you? They don’t pay for shit. It’s not a medal, it’s not a salary. It’s not something they can take to the bank. But you know it’s right. You can feel these heroes are worthy, and you follow the rules. You pick up their check.

A Call for Coordinated Cloudbursts

While researching this post, I received an invitation from About.Me, a service where I already have a simple profile posted about myself in classic vanity press fashion. What struck me most was that the main request in the invitation was for me to try out the new in-dashboard feature from Klout, a web service that allows you to track the number of and quality of (ranking) posts you provide in the Twitterverse and Blogosphere. Yes, two buzzwords at the end of one sentence.

However, visiting the link from the invite on Klout works just fine, while the link to About.Me’s in-dashboard new Klout feature fails. Not from user error, where a mass email was sent with a typographical error in the URL, not from database code in the CRM’s mass email system, but where About.Me apparently sent it to everyone at once. Now, like a fifth-grade rumor that has everyone flushing the toilets at the same instant, ruining the school’s plumbing, or every human being on earth jumping up and down in the same moment to move the planet out of orbit, a very real effect has been achieved: the link can’t respond to all the users at once.

The methods behind cloud computing allow for quick scalability, for immediate response to overwhelming web traffic and processing, but the sad truth is that they can be throttled. By choice, by service level agreement, by paid tier, there are numerous reasons why banks of servers that were built to handle small spikes in traffic but can’t hold up to large jumps in processing…. Often the CPU-sharing agreements allow for a “burst” method where processor power on the server banks aren’t always working, but pulse in large part, then slow down.

The beauty on the example of About.Me’s ask was that within minutes (about 8-10 minutes, in fact) they had remedied the problem and the links were working, the integrated Klout functionality was up and running, and I was amazed. Not by the feature, although it’s delightful. I’m amazed at the digital ability to scale in more processor power when needed, in a way that makes me reminiscent of the machines in Fritz Lang movies or steamboat engineers, twiddling knobs and opening valves for more power when needed, slowing it down when no longer necessary. The Amazon Cloud, Google Apps Cloud, and a variety of private services like Rackspace.com seem to have this handled within limits in a very clear way.

But the innovation is still in its infancy.

What is needed is a predictive model, tied in with the CRM systems, so that when an email leaves the “house” containing a link to servers hosted on the same (or a connected) cloud platform, the system can presumptively throttle open more spillways or even veritable floodgates depending on how many recipients are targeted, or, to take it another step further, to integrate with the response mechanisms in those messages, in case a small group of recipients is included in the initial mailing, but the email “goes viral” and includes a high pass-along rate.

A model is needed that can take all of these data points and feedback items into account and can plan to work and react ahead of usage in an overall architecture.

The technology, of course, will follow.

Strange Love: Or How I Learned to Stop Worrying and Love the Anna Kournikova Virus

(Reprinted from 2600 Magazine, Spring, 2001)

It’s odd the people you keep in your address book. As a reader of 2600 for the past eight years, you learn a lot about what people will and won’t find offensive. You learn that people will complain about things that affect them, and won’t complain if it hasn’t affected them yet.

When I received the Anna Virus, I knew it for what it was: a program created by some hacker that had been sent to me unwittingly by another individual. I guessed it might be a worm that would be sent out to another user after an inadvertent reading or clicking of the email message containing it.

I clicked.

Within minutes I was receiving phone calls and emails, some laughing and joking, others solemn and angry, from all the people in my address book. Some were asking what I had sent. One man even wanted help opening the attachment. “I’m sure she’s hot,” he replied. “But my mail program won’t open the picture.”

I had sent email to people who owed me money, to people I am in litigation with, to women I haven’t called after an affair went sour, to men I had admired, to persons I had feared.

Worst of all, I hadn’t just sent an email. I had sent them the virus.

It took a few hours to sink in the potential impact of what had happened and you can imagine that I could have been angry. I could have been dismayed. But I had made the choice to try the virus anyway. I had been in good company. CNN carried news of the virus well into the next few days. I was elated and disgusted at the same time. I had burned bridges and made others laugh at my actions. I felt happy I had made no mistake. I had run the virus on purpose.

Now the most important question many would ask is why create such an ugly virus? “Why do hackers have to waste so much time and money on destructive forces?” they demand to know. My response is simple. If the virus I received had short-circuited my copy of Windows, if it had sent instructions to my hard drive to reach for a sector that didn t exist, gouging a new hole in my storage space, the Anna Virus would have been wrong and sickly twisted, something I could hate.

But it didn’t. It taught me, and many of you, a lesson. It taught us to guard against such threats and to be ever wary of what we see and open. It took nothing from me, nothing but a little pride, which I could make do without. And the Anna Virus introduced me to people I haven’t spoken to in a long, long, time.

Their emails may begin with “I think you have a virus….” But they all end with “So how are you doing these days? How is life?”

Meeting Warren Avis

In an unassuming building on State Street in Ann Arbor, Michigan, I met
the head of the Avis Empire in 2001, the man who had built and sold Avis Rent A Car and all its innovations in the 1960s. His small staff buzzed productively from room to room as he announced, “Each worker for Avis is respected…”

   Why create the Shared Participation theory?
   I wanted to contribute something to the business culture.  I had been very successful, and had spent ten years at Harvard Business School and knew I wanted to do something people would benefit from.  When I look at the Newman’s Own salad dressing bottle, I see that $100 million has been donated to charity as a result of people buying that bottle.  It makes me feel good to do it.
   Team management is a buzzword in today’s business society, but if you include regular meetings, with truly anonymous comment systems, will work every time.  Blame the implementation, not the system if it fails.
   This was first an idea in the 1970s as a shared problem-solving process.  The growth of the system, and the books I wrote led to the formation of Shared Participation using team implementation.  By forming teams, with regular meetings and anonymous comments, people learn to respect the process, and most importantly, learn to respect each other. Using Shared Participation, you learn that every voice in your structure is important. This brings harmony by allowing two people in a conversation to really listen.  You cannot out think the system, you cannot out think a team of five people.  It simply is not possible.
   The Montgomery GI Bill made the United States the great nation it is today, because it changed the educational value system in this country.  Before, most families didn’t send children to college because of the cost, because they didn’t see the value in higher education and the ability to get it.  With the GI Bill, many families of all incomes suddenly had the ability. 
It has educated our nation like nothing could.