There once was a traveler named Wright

Decide the action before you know the problem

There once was a traveler named Wright,
Who traveled much faster than light.
He set off one day,
In a “relative” way,
And returned the previous night.

- James Thurber (I think).

What decisions would we make if we could go back just day? This blog post is about decision making. It was inspired by a question posed over at BPM.com. Recently Satya Nadella, the new CEO of Microsoft, said:

“Any organizational structure you have today is irrelevant because no competition or innovation is going to respect those boundaries. Everything now is going to have to be much more compressed in terms of both cycle times and response times.”

When my daughter’s were growing up I encouraged them to make their own choices and to live by them. I used this children’s riddle often in those conversations. “There are five frogs on a log. One decides to jump off: how many are left on the log?” The answer, my kids will tell you, is “five.” Deciding to jump and actually jumping are two very different things.

In modern business we are too frequently stuck on the “deciding to jump” stage. We get caught in the analysis paralysis of needing more data. So we develop ever more elaborate ways of reporting and visualizing the information our BPM systems deliver and all the while the our more nimble competitors, who have nothing to lose and everything to gain, are jumping off their own logs onto better ones and on to our log. And the more they are successful the more they reduce their decision time. And the longer we wait to act the harder it becomes to act.

Despite all of this we still feel superior because we have more data.

Colonel John Boyd of the USAF added two more steps to the Decide/Act process. He added Observe and Orient before Decide and Act. We now call this the “Boyd Cycle” or “OODA Loop”.

Observe: In business we should be constantly reviewing how we collect data and interpret it. We must observe the trends in the internally gathered telemetry as well as publicly available data. Anecdotes from sales calls, information from job interviewees and blog sites like this one. Data needs to be shared among all the decision makers in a consistent manner.

Orient: Is where we filter that information with what we know about the business, the market, the technology capabilities. But this is this everyone’s weakness. We tend towards “happy ears”, we treat with higher value the information that confirms our point of view. Scientists call it confirmation bias: we have have to teach ourselves to embrace ideas that conflict with our own and improve our filtering system.

Decide: The decision making process also needs to step up its cadence. If we delay we will miss the market, miss the first-mover advantage: we will not get the worm. But in Boyd’s process we should not be making decisions serially: we should make the next decision and the one after that and the one after that so that by the time our competitor responds we have already pivoted and seized the next market advantage while they are uselessly trying to address the old ones.

Act: Empowerment is key. Once the decision is made teams should be empowered to act and execute the plan. Again it is vital to train the team that the tempo of business is going to accelerate and the rate of change will be rapid.

Loop: Throughout this cycle we are gathering more information, filtering it and analyzing it, modifying the next (and next-next and next-next-next) decisions and adjusting the actions in place.

At the USAF Weapons School in Nevada, Colonel Boyd was called “40 second Boyd” because he bet that he could defeat any military pilot in air-to-air combat in 40 seconds using the OODA principles. He never lost that bet.

BPM and ACM are powerful tools that observe the information our business is collecting and orienting that information for executive consumption. We do let those tools take the next step and decide how that information should flow and we permit them to act on our behalf without human intervention.

But we don’t do that very deeply into the decision making process. The horror stories are real: Knight Capital losing $400m in 45 minutes when the automated trading system sold low and bought high. If it had made $400m in 45 minutes we’d celebrate it as a victory of automation. (My own confirmation bias is showing up very clearly here).

So there is room between superficial automation that manages hand-offs amongst team members and complete abrogation of decision making to technology akin to SkyNet.

Satya Nadella is right about one thing, cycle times are short. We can respond with our gut, or we can respond with technology, or we can follow Colonel Boyd and respond with both.

Last week I was at a conference where a VP of Customer Support spoke and said “If we don’t hear from the customer for a while, we call them to see how things are.” This is being inside the OODA Loop, this zigging before the customer zags, this is solving problems before they are reported, this is compressing cycle times and response times. This is using BPM and ACM to inform Customer Support Advocates where they should direct their outreach.

So I would say Microsoft’s new CEO is also wrong, or at least out of date, about one thing too. We should not be focused on cycle time and response time at all but perhaps in pro-active, prescient time. It’s brave, new, science-fiction-come-true, world out there.

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The CIO is dead! Long live the CIO!

Chief Insight Officer … the new kid on the data cube

More from the debate over at BPM.com.

Processes and data are engine and fuel of business. An engine without fuel is will take us nowhere. Unburned fuel is just energy hanging around with nothing to do. Process without data … well, you get the analogy.

Data has gone from being a facsimile of an entry in a ledger (60′s flat files), to an online archive of transactions (70′s indexed files), to a connected catalog of information (80′s databases), to a cross reference-able decision support system (90′s relational databases), to a consumer facing sales tool (00′s web-apps), to a mash-able source of public and private insight (10′s mobile apps).

The trajectory of data is moving from simple audit-able, transactional record keeping to empowerment of consumers and business leaders. The further along this continuum we move the connection between the data’s purpose and the ways we exploit it become ever tenuous.

http://www.cosmopolitan.com/cm/cosmopolitan/images/Op/facebook-breakups-11410-lar.jpeg
An example: The much quoted FaceBook Status change graph shows how many Facebook users changed their relationship status to “single” on each day of the year. Those making the status change are telling their friends about what is new in their life. Aggregated together the data tells a story to our society, its pressures, its trends and that weekends put a lot strain on relationships.

See also Google “Flu Tracker” where Google tracks searches looking for flu symptoms to predict where epidemics are likely to break out.

This is “Big Data” in action. My belief if that those with a Sherlockian mind that can sleuth out insight from the peaks and troughs of aggregated (ie. big) data will be the new superstars of our business. Perhaps CIO might finally mean Chief INFORMATION Officer, or at least we might create Chief INSIGHT Officers.

Those insights will lead to new processes. Business leaders will learn from the C-Insight-O that when there is a dry winter in California hotel room rates increase in Hokkaido so they need to ship suncream to Japan earlier. From these insight will develop new inventory management processes.

Just like Amazon deciding to ship product before you buy!

So what does all this mean?

We will get the most out of Big Data by being completely free of process. The “creativites” who will see meaning in data will have the most abstract role that there has ever been in technology. But from their wisdom we will optimize how we run our business by introducing processes that exploit the newly uncovered truths.

For me this is the most exciting time there has ever been in our industry. What problems we will solve! What conundrums will become commonplace? How many unknowables will be ubiquitous facts? Once insoluble quests will be daily tasks done on our wearable device.

Process consumes data, data delivers insight, insight improves process. How sweet is that?

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The beatings will continue until morale improves

Victory victorious at The Battle of Trafalgar. Better seamen, with better ships, using better discipline, better training, a better plan and better processes.

An interesting debate is going on over at BPM.com over a comment I made a couple of weeks ago about what processes should, and should not, be automated.

I keep going back to job titles. How many Directors actually direct, how many Managers manage, how many Team Leaders lead, and how many Supervisors supervise? Daily I meet too many captains charged with navigating the business who spend too much time (frequently all of their time) emptying the bilge, stoking the engines and plugging the leaks to do the job they are en-titled (my hyphen) to do.

The naval metaphor is chosen deliberately. Process optimization has been at the core of the naval service for centuries. The ship that could fire and reload the fastest would win. The crew that could make the best use of the wind would catch and take the prize. Everyone had a job that was well defined, expectations were clear and exceptions dealt with (alas) harshly. Efficiency, accuracy and optimal use of resources were, and are still today, a matter of life and death.

When the process machine is running well there is time to reflect upon what can be done to improve. When the status telemetry alerts us we have time to re-balance the resources and coach those who need it. When the data points us we can shift our business around the storm or catch the breeze before anyone else.

For the crew it is the “what am I doing?”: process automation for them is about delivering products and services with the utmost efficiency and accuracy. For the officers it is the “why am I doing it?”: it is about having the time to think about where they are going and how they can get there safely, quickly and cheaply.

“What” should always be automated. “Why” can never be automated.

 

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Colossal data

The answer is in there

Palaeontologists glean the workings of ancient ecosystems from a single fossilized leaf.  Archaeologists derive whole civilizations from a fragment of a tooth and a few charred animal bones. Astronomers track down our planetary cousins from the periodic twinkle of a distant star. Physicists spend a lifetime studying particles that they can only imagine and infer.

Most of science, it seems, is searching for truths amongst a paucity of data. From the most meager of evidence, with a rigor that is designed to disprove rather than prove, they are able to show us profound insights into time, space and the nature of all things.

For those of us in IT we are often blessed with an abundance of data. Our purpose was once to collect data, aggregate it, present it and make informed decisions based upon it. That has been our task for the past 7 decades (happy 70th birthday to Colossus by the way). But now we are being asked to see the data in a very different way.

We walk though the world mostly oblivious to the detail. We don’t feel the sub-atomic particles that pass through us every day, we don’t recognize the colorful rock as fossil, we think the star is merely pretty as it twinkles. Unless our job is to analyze the fundamental structure of the world we only see the surface of it.

The same is true of data. We have to force ourselves to find meaning in the data beyond what the data documents. And now we have lots of data. Decades of data.

There is a wonderful chart of Facebook status-changes that shows most breakups happen around the holidays. Google has a great map of people checking on cold symptoms that presages flu outbreaks. Amazon has had a patent issued (appropriately it was issued on December 24th) that shows they can ship our orders before we place them because they know when we are browsing and when we are buying.

This year will see the emergence of modern shaman. These new mystics will discover hidden meaning in the random collisions of the 0′s and 1′s. They will uncover new truths, break uncrackable codes and answer questions not yet asked.

When the seemingly random language of the Lorenz code was cracked 70 years ago it took an extraordinary human insight and mighty technology breakthrough. The insight was provided by Tommy Flowers, Max Newman and the amazing team at Bletchley Park and the technology the world’s first electronic computer, Colossus.

Big data will deliver this year because of some very smart people with a unique way of looking at the world supported by some extraordinary technology that is not bounded by limits of power and time.

What this means for business is the chance to shift to new markets and new products ahead of the competition, ahead of the economy, ahead of the consumer. What this means for technologists is new problems, new solutions and new careers. We are witnessing a pivotal moment: it’s very exciting.

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Rotten Burroughs

What is in a name? From The Hudson River Bridge to The Palisades Bridge to The Fort Lee Bridge to The Columbus Bridge to The Verrazano Bridge to The George Washington Memorial Bridge and finally to simply The George Washington Bridge. And now its just Bridge-gate. As it looked in 1932 a year after it opened.

To be a civil servant in 7th century China one had to pass The Imperial  Examination. This exam was designed to identify which candidates had achieved the required academic and level and to determine who had the temperament and dedication required to serve in the Imperial Chinese government.

In 1854 the British Government adopted the Northcote-Trevelyan Report and instituted a system, The Civil Service Entrance Exam, similar to the one created by the Chinese 1,200 years earlier. The British found that the quality of the government was being diluted due to many top positions being occupied by friends and family of politicians rather than by career civil servants. The British created a clear separation between administering the country (civil servants) and the creation of policies by which the country was administered (the exclusive purview of politicians). This created a natural check-and-balance which prevented politicians from exacting influence on specific situations (put tarriffs on this and not on that) and prevented administrators from creating policy (they are not elected and therefore not necessarily representative of the people’s voice).

With this single reform political patronage became a thing of the past. Civil servants become expert in their fields, powerful advisers to politicians and resourceful caretakers of the country’s resources. Oversight parliamentary committees have full access to senior civil servants who, in turn, are legally bound to justify their compliance with the policy while complying with the law. Those same civil servants are often in their post for decades before their current cabinet minister comes to power and continue in their job for decades after they are gone. The civil service is a great example of service to one’s country without the need to be in harms way or subject to the vicissitudes of politics.  They provide continuity and stability from one administration to the next.. Could it happen here?

How would it be if the Sheriff were the most able policeman rather than the most liked? What if the circuit judges were chosen on the basis of their record rather than on how they view social issues. Imagine a world where the District Attorney pursues corrupt politicians with the same vigor if they are Democrats or Republicans. Would things be better if we had qualified candidates rather than ones with the greatest number of donors. And what if they didn’t have to stand for election, or re-election, and we paid them as civil servants and sent them to jail if they took money from wealthy interest groups. We’d call it bribery in any other domain but we call it campaign funds in politics.

I re-read the Constitution today. I like to do that every once in a while.  It states in Article II, Section 2: discussing the powers of the President:

“He shall have Power, by and with the Advice and Consent of the Senate, to make Treaties, provided two thirds of the Senators present concur; and he shall nominate, and by and with the Advice and Consent of the Senate, shall appoint Ambassadors, other public Ministers and Consuls, Judges of the supreme Court, and all other Officers of the United States, whose Appointments are not herein otherwise provided for, and which shall be established by Law: but the Congress may by Law vest the Appointment of such inferior Officers, as they think proper, in the President alone, in the Courts of Law, or in the Heads of Departments.”

The framers of the Constitution could not be aware of the consequences of their actions and we find ourselves encumbered by this culture of entitlement, graft and privilege in the hands of politicians who are too easily bought and paid for.

In the British General Election of 1831 more than half of the 400 members of parliament were elected by fewer than 100 voters. The constituencies were ruled by powerful landowners who ensured all their farm tenants and laborers voted them into office or else they’d be fired. These “Rotten Burroughs” resulted in large scale disenfranchisement of the population especially in the fast growing Northern part of the country which was the new seat of British wealth and prosperity. Against their own self interest, members of parliament passed the Reform Act of 1832 which created constituencies based on population and geography and therefore created a much more representative lower house in parliament. Thomas Paine used this as one of his central arguments against the insanity of the British system.

Is modern American democracy any different than the 19th century Rotten Burroughs of Britain? When Politicians use public funds to exert personal influence and punish (or please) individual groups within their constituency are they not behaving like the landowners of Victorian times?

Will we ever see a majority of politicians vote against their self-interest and the interest of their donors and do the right thing. Perhaps, we can update the old sore leveled against the United States to read “going from barbarism to decadence and finally to civilization”.

I will continue to dream on.

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Bridges 2: the blog I started to write before I got distracted

New (left) and old (right)

Why did it take two decades after the Loma Prieta earthquake before we got a new Bay Bridge? We know we need to invest in infrastructure: it’s a desire as old as humanity ourselves (from caves and fires to labs in space). But, it seems, we are loathe to RE-invest in infrastructure once we have it.

Are we rewriting the old saying as “if it ain’t broke YET don’t fix it?”

This week I’ve been pondering the forces that make someone choose to abandon old technology in favor of something new. You know the process … how do you decide when it is time to buy a new car, or new TV? What about enterprise software? Is replacing your legacy business system (payroll, order entry, inventory management) subject to the same forces that drive consumers (cars, TV’s) and governments (bridges, roads) to get the latest shiny object in their living room, garage or spanning their Bay?

Cost is probably the number one concern for purchasers, corporate or consumer. How much will it cost to replace the old system? Cost can be calculated in many ways. The purchase price and the cost of having experts install, configure, migrate and train are the costs we see in the checks we will have to write.

But there is also a cost of keeping on doing the same thing. There is the lost opportunity cost from using a system that is to slow to satisfy customer demand. The system that is too hard to use or that keeps failing and drives potential customers away.  The cost of the additional manual effort required to keep a system going because it can’t be brought up to date. The cost, and the cost of the risk, of using old hardware and software that is no longer supported, or has security vulnerabilities or which no longer meets the needs of federal, state or internal compliance. While these are often much harder to quantify and rarely involve writing a check they are still real costs.

Fear is a strong motivator. I need a helmet if I am going to be a cyclist. For an organization fear comes in many forms. Regulations like Sarbanes- Oxley are not optional. Publicly traded companies fear an audit finding needing to be included in their annual report lest it affects their share price. Fear of falling behind competitors technologically and missing entry into new markets because the product or service can’t be delivered on the new platform, for the new methodology or using the new social media.

Spreading FUD (fear, uncertainty and doubt) is also an ancient motivator and sales technique.

FUD is also the cause of all too many wars not least of which, the First World War 100 years ago this year, was entirely caused by FUD

Familiarity is a surprisingly powerful driver of change. So may business decisions are based on what we know, who we know rather than on rigorous research into alternatives. A new executive in a new job will often retool the department in their previous image organizationally, culturally and technically on the basis of what worked before is tried and tested and will work again.

Whether it is Caesar or the CIO, there is a trend of bringing “your people” with you from position to position: many people’s careers are in the wake of a former boss.

Fashion followers spend hundreds of dollars on branded sunglasses to make a statement. In the corporate world fashion is another strong buying driver: though we are less open about our fashion-passion than the average shopper on Rodeo Drive. Justifications such as “it will attract the best talent”, “we’ll be seen as industry leaders and that’s good for sales” and “it gives us a competitive edge” are common when, too often, the choice is made because everyone was talking about it at a conference or the buyer see it as a résumé enhancement opportunity.

Often these purchases are made at events with all the attendant pomp that would accompany a Hollywood awards ceremony and this just adds to the cachet of the purchase.

Summary: so what do we learn? What drives an individual to replace their dishwasher is pretty much what drives them to purchase enterprise software. The only difference is whose money is being spent.

I don’t have a recipé for success here. But I do have a recipé and, as they say, the proof will be in the eating.

  1. Cost: be clear. Don’t mess around with pricing: choose the price that represents the value of your product and stick to it. If the prospect says no – move on. Nothing proves that you believe in your product more than a sales person walking away from a deal.
  2. Cost: be real. Have your ROI nailed ahead of time: show 5 years of the cost of doing nothing (costs that are provable and measurable) and show all the costs of your solution over 5 years. Breakeven better be within 18 months or your not going to win.
  3. FUD: be truthful. Show case studies of customers who missed the market, had unexpected outages or who failed an audit.
  4. References: be local. Chances are your prospect will know someone or know of someone who already uses your product or service. Enlist their help. Most people will be honest and balanced in their views. We all know there is no perfect solution or perfect vendor. Being prepared to let your prospect talk to your customer says a lot about your confidence and integrity.
  5. Cool: is a crowd. List the customers who have adopted your product or service in the last few months. And ping the prospect every time a new one joins the club. Nobody wants to be the last one to be picked to play.
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It is better to fix the bridge before it falls down

Business needs bridges

In the 2013 American Society of Bridge Engineers (ASCE) report card on American Infrastructure rated our nation’s bridges a C+ and said “Over two hundred million trips are taken daily across deficient bridges in the nation’s 102 largest metropolitan regions. In total, one in nine of the nation’s bridges are rated as structurally deficient [my bolding], while the average age of the nation’s 607,380 bridges is currently 42 years. The Federal Highway Administration (FHWA) estimates that to eliminate the nation’s bridge deficient backlog by 2028, we would need to invest $20.5 billion annually, while only $12.8 billion is being spent currently. The challenge for federal, state, and local governments is to increase bridge investments by $8 billion annually to address the identified $76 billion in needs for deficient bridges across the United States.”

One in nine bridges are deficient. 200 million passengers a day at risk.

In July a tragic accident in Spain killed 80 passengers on a train that took a curve at 190 kph that was rated for just 50 kph. Six months later the very same thing happened in Yonkers when a train derailed while traveling at 82 mph on a curve designed to be taken at 30 mph. Tragically there were four more victims in this accident.

The technology was available to automatically slow these trains and take control from the human drivers but the investment in the technology was not made despite the real risks.

In the 12 months after the murders at Sandy Hook Elementary School 179 more children under the age of 12 died from gunshots in the USA. What gun controls we had before Sandy Hook are now more relaxed: not more stringent.

The State of the Union Address is this evening. It is when we hope to hear our leaders set the vision for our society.  We get to put aside political differences and decide what is in the best interest of our society and do the right long-term things even though the short-term may be painful.

We need to build metaphorical bridges in our polarized societies. We need leaders who can deliver hard truths and not be more afraid of losing their job than they are of the consequences of their truths. We need the mega-rich to volunteer to lead the re-investment in our infrastructure rather than to concentrate on being “tax-efficient”. We need the military to be realistic and comprehensive about our defense but nothing more than that. We need our food producers to keep us safe from harm even at the expense of profits. We need our energy providers to deliver power that won’t harm our future on the planet. We need everyone to listen to experts and not ridicule them. We need pundits to place more weight on facts than they do on the opinions of other pundits. We need to trust the government to hold our data sacred and the government needs to hold our data sacred.

We all know what is wrong with our world: we just differ in the degree to which we think it matters and the order we’d like to see them fixed. If we each make one decision a day that is in the interest of others we can make this a better world … and maybe get some real (and metaphorical) bridges fixed.

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