Monday, July 30, 2007

Advice du Jour: Do Whatever Gets You Tenure

 
 

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via Paul Kedrosky's Infectious Greed by pk on Jul 23, 2007

I was recently talking to a CEO friend of mine who is having trouble with his board. He thinks there is a very good chance that he will soon be fired.

What's the problem?, I asked.

"Fucking board full of VCs," he said. "They undervalue me. I'm knocking myself out getting this company on analysts' radar, getting our systems in place, hiring good people, and even closed this recent round. And what do I get? Grief at every board meeting, and at weekly calls inbetween."

What are they giving you grief about?

"Number crap," he said. "They are hung up on a couple of key accounts, ones that we thought we would have closed by now, but haven't. It'll either happen or it won't, but beating on me every week isn't going to change anything. These fuckers should get a real job sometime and see what it's like on the other side."

I don't want to sound glib, I said, but why don't you just close the deals?

"What?", we're trying. "But it's complicated and time-consuming, and I can't spend every minute hanging with my sales guys as they work the process. There are too many fires to spend my time only on those ones."

I told him the story of another super-smart friend of mine. Harvard Ph.D. One of the most intelligent people I've ever met. Quicker than quick. He took a job as an academic at a top-tier U.S. school, had a great research program, and proceeded to not get get tenure, despite being the smartest guy in the place, which everyone knew.

Why? Because to get tenure he had to publish papers, and he had a couple of key papers in the edit cycle, and he knew they would eventually get published. He spent the bulk of his time doing other stuff, like consulting, teaching, helping other faculty, and doing doctoral supervision. Trouble is, those key papers weren't accepted in time for his tenure review, so he was terminated -- even though the papers were accepted 3-4 months later.

The moral of the story: Do what gets you tenure. If he had been knocking himself out getting other papers in other publications, even if they hadn't published, he would have been cut more slack than he was for what he did (however laudable it was).

Same thing for my CEO friend. Boards are wrong about many things, but if you balk at the thing they unanimously want, then you are going to have to soon find other employment. Do what gets you tenure. If they want to see you selling, be seen selling. A lot.

And if you think that's being cynical or pandering, then you have no business in real world of business.


 
 

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Sunday, July 29, 2007

Perspective with Humility: i probably want to read this interview

 
 

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via Aswath Weblog by aswath on Jul 13, 2007

Just listened to an interview given by NEA's Managing Partner Kittu Kolluri. There he says: "Success makes you look better than you really are; failure makes you look worse than you really are." I can use the quote as an...

 
 

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Good IDEAs

i should go thru them

 
 

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via Anil Dash by Anil on Jul 23, 2007

The International Design Excellence Awards (IDEA) winners for 2007 have been posted on BusinessWeek's site. There are all of the usual slideshows and essays that you'd expect, but perhaps the coolest tool is the interactive table of winners from 2000 to 2007, sortable by client, school, or designer.


 
 

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Wednesday, July 18, 2007

RE: Bill Gates, Ambition, Legacy, and Obligation

great idea..let do it...

From: Umesh [mailto:ukumar@gmail.com]
Sent: Tuesday, July 17, 2007 8:20 PM
To: ukumar.articles@blogger.com; Kumar, Umesh (REPO); Trivedi, Ashish
Subject: Bill Gates, Ambition, Legacy, and Obligation

hi ashish,
how about lunching one day on baby carrots every week and collecting that money for donation ?...two weeks will translate to 1 child 1 year of food.

 
 

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via Anil Dash by Anil on Jul 07, 2007

I've followed the history of Bill Gates and his career and work since I was a kid. Though he's not nearly charismatic enough to inspire an army of fawning fanboys, the complexity and eccentricity of a lot of his choices makes his character endlessly fascinating to me. And of course, it is an extra bonus that most people confuse such an interest for uncritical adoration, which ain't the case.

I'm not a Bill Gates fanboy, I just think he's more ambitious and more likely to permanently change the world for the better than anybody else in the history of the technology industry.

Part of understanding why is having the proper perspective. I remember Microsoft's mission from when I was a young kid -- a computer on every desk and in every home. That mission, of course, had an implicit suffix of "...running Microsoft software". About 25 years into that mission, before Bill Gates had even turned fifty years old, Microsoft had achieved that goal. Think about that -- you set a goal as ambitious as you can imagine, and before your kids are even in high school, it's happened. What do you do when you've accomplished your biggest goal?

It's not a problem most of us ever have to deal with. Honestly, most of us that would even take the time to set such a goal would make it so big or so fuzzy it would be impossible to ever achieve. But by being just slightly specific, Microsoft under Bill Gates' direction achieved a seemingly-extraordinarily ambitious goal.

So, what next? You have to go for an even bigger goal. What's bigger than computers everywhere? How about curing malaria? And AIDS? That seems big enough. And the true innovation seems to be approaching those problems in an entrepreneurial way, with a big focus on accountability.

And after years of seeing his awkwardness in articulating the benefits of technology, it's startling to see just how good Gates is at telling this far more important story. You might have seen a link to Bill Gates' Harvard commencement address and probably thought "eh, I'll read it later". Go read it now: it's the kind of leadership and accountability that's been sorely missing from those in a position of power in the technology industry. Hell, it's the kind of message that's been curiously absent from the lips of nearly all of our leaders.

Just one highlight:

I remember going to Davos some years back and sitting on a global health panel that was discussing ways to save millions of lives. Millions! Think of the thrill of saving just one person's life - then multiply that by millions. ... Yet this was the most boring panel I've ever been on - ever. So boring even I couldn't bear it.

What made that experience especially striking was that I had just come from an event where we were introducing version 13 of some piece of software, and we had people jumping and shouting with excitement. I love getting people excited about software - but why can't we generate even more excitement for saving lives?

You can't get people excited unless you can help them see and feel the impact. And how you do that - is a complex question.

Still, I'm optimistic. Yes, inequity has been with us forever, but the new tools we have to cut through complexity have not been with us forever. They are new - they can help us make the most of our caring - and that's why the future can be different from the past.

The defining and ongoing innovations of this age - biotechnology, the computer, the Internet - give us a chance we've never had before to end extreme poverty and end death from preventable disease.

I'm sure those who make their decisions based on fashion and popularity contests won't want to give Gates the benefit of the doubt. But I'm okay with someone uncool doing the right thing on an unimaginably ambitious scale.


 
 

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Tuesday, July 17, 2007

Starting Up Again: tips on managing job change

 
 

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via In the Pipeline on Jul 09, 2007

I'm back! This entry comes from temporary quarters in Cambridge, which will be my home for about another six weeks. The second half of that period will find the rest of my family in here with me, but for now it's just me, an internet connection, and some take-out souvlaki.

Going to work tomorrow will be a novel experience, after a solid five-month break. But this isn't the first time I've changed jobs, and like everyone else in the industry, I've seen a lot of turnover around me. Both vantage points have suggested some avoidable mistakes when starting a new position.

First off is badmouthing your old company. It's tempting - I mean, after all, you left the place for a reason, right? And isn't the new place so much better, and shouldn't you make everyone happy by telling them so? Actually, no, you probably shouldn't. There's a real risk of coming across as someone who does nothing but moan, and most labs have enough of those folks around already. Keep in mind that you just started, and that people haven't heard you talk much. You don't want your co-workers to realize that half the things you've said so far are complaints. Hold your fire.

You can screw up in the opposite direction, too, of course. (You always can, a general principle I try never to forget). Talking about how things were so much better back at the old gig won't win you any friends either, obviously. Sure, maybe it was easier to order supplies, or get instrument time, or whatever. But no one cares, and you shouldn't either.

This it-was-better stuff turns, very quickly, into another method of complaining, and we're back to the same place as with the first mistake. My view is that grousing about work conditions is something that should be done only among peers that you've worked with for a good while, people who know you and have seen that you can get the job done. At a new job, you don't have anyone in that category yet, so it's better to keep quiet. And anyway, how silly does it look to start in on how things are done when you haven't done anything yet?

Other mistakes: coming on as if you're the answer to everyone's prayers (because that, of course, makes the inference that everyone was doing it wrong until you showed up - if you really are the answer to said prayers, that'll become apparent on its own pretty soon, wouldn't you think)? And its opposite - starting off so quietly that people start to wonder why you were hired in the first place. It's normal (and a good idea) to shut up and listen for a while at first, but that can be taken too far. Eventually, you'll need to speak up.

Well, I won't be making these particular mistakes, I hope, but that just reserves me the right to make some others. At any rate, it's good to get back to research, and no mistake about that.


 
 

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excellent concept of tax saving...reverse vesting of shares

 
 

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via Joel on Software by Joel Spolsky on Jul 16, 2007

Steve from Richmond, VA, wrote in to ask a couple of questions:

"With software development, is it better to get something out there with customers and then continually improve or build the best wiz-bang software and then start marketing?"

That depends. You want to avoid the Marimba Phenomenon, where you get so much publicity in the early days that everybody checks out your underwhelming offering and decides that you're never going to have something worth looking at. (I should rename this the live.com phenomenon, in honor of Microsoft's horrible launch of live.com. Or the Zune phenomenon.) On the other hand, small startups are unlikely to have the problem of too much attention, so most companies with a 1.0 product can certainly get real customers with their earliest usable versions and build from there.

Steve is starting a company with a software developer.

"Assuming the software developer is getting paid at a reduced rate, but concurrently with his development. If you were giving also giving him some equity in your company, would you make that equity contingent on phases of the software getting done, the entire software getting done or vesting over time."

The standard solution is to vest over time -- anywhere from four to seven years -- with unvested shares being forfeited if he leaves for any reason. If the software doesn't get done, you fire him and he loses the unvested shares -- it's not necessary to make the vesting contingent specifically on finishing the software (besides, "finishing" software would be too hard to define in a contract).

You can set it up either as normal vesting (where he gets, say, 20% of the shares every year) or reverse vesting (where he gets the shares up front, but you have the right to repurchase them for a penny, and this right evaporates by 20% every year). Reverse vesting is preferable for tax reasons, because at the time you give him the shares, they're worth a lot less, so there's less income and more capital gains, which are taxed at a lower rate.

Not loving your job? Visit the Joel on Software Job Board: Great software jobs, great people.


 
 

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Business of Software Conference

big names and book suggestions

 
 

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via Joel on Software by Joel Spolsky on Jul 13, 2007

The Business of Software conference coming up at the end of October is new this year, but it's got a pretty phenomenal line-up of speakers:

Also speaking: Dan Nunan, Jennifer Aaker, Jeffrey Pfeffer, Bill Buxton, and me. Register here.

Not loving your job? Visit the Joel on Software Job Board: Great software jobs, great people.


 
 

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Lowering The Water Level

 
 

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via Evolving Excellence by Dan Markovitz on Jul 12, 2007

Toyota calls it "lowering the water level."

Imagine a value stream or a production process as a river. Reducing the inventory in the process - "lowering the water level" - exposes the "rocks" that represent all of the hidden costs and waste in production. Only by revealing those rocks can you improve the process and reduce the waste.

This metaphor works for knowledge workers, too. In this case, however, their key inventory item is time. Having too much time to do one's work hides the waste and inefficiencies in the process.

Now, most people would deny they have too much time to do their work. Not too many people are taking three-martini lunches anymore, or leaving the office right at 5:00pm. Hell, on average Americans only take about 79% of their vacation time, and 20% of people work on their vacations. And with our cellphone- and Crackberry-addled days, nights, and weekends, it seems as though there's an infinite torrent of work. Ironically, these same vacation-skipping, Blackberry-beholden employees complain vociferously about a lack of time for their personal lives.

But here's the thing: your cellphone, Blackberry, and general willingness to work late and on weekends are part of the problem, not the solution. Counterintuitive, but true.

Yeah, yeah. I can hear you now: "If I didn't have my Blackberry, if I didn't put in a few hours on the weekend, I'd never get on top of everything I need to do. I'd be buried. I'd get fired. I'd end up on the street with two Dixie cups and a string instead of an iPhone."

Let me ask you this (in the words of Dr. Phil): How's that working for you so far?

Has it helped? Are you on top of your work? Do you spend enough time with your friends and family? How's your fitness level?

The fact is, if you had less time for your work, you'd get it done more quickly. Parkinson's Law - work expands to fill the time available for its completion - recognizes this painful aspect of human nature. And if you don't believe it applies to you, think about what I call the Vacation Paradox: even though you never seem to be able to get all your work done on a regular day, the day(s) right before you go on vacation, you somehow manage to crank through all your daily work plus the backlog of stuff that's been moldering on your desk for the past month.

What's going on? Well, when you're short on time, you work more efficiently. You reduce the waste in your work process so that you can get stuff done. There's no choice, because you're on the plane to Maui or St. Moritz tomorrow.

But (to go back to the analogy I started with) when the water level - your inventory of time - is high, there's less urgency to reduce inefficiency. Why bother removing the waste in your work habits when you can just stay at the office an hour later, or get it done over the weekend? This is just another manifestation of the normalcy of waste.

And that's the nefarious aspect of living on your Blackberry 24/7, and your willingness to work on weekends and give up your holidays: you effectively raise the water level by increasing the amount of time you have to accomplish your work.

Lower your inventory of time available for work, and then you can reveal and address the inefficiencies in your work habits. In the spirit of kaizen, commit to leaving the office 15 minutes earlier one day this week. Then make it two days next week, and three days the week after. (Applying 5S principles to the information you manage will help. Read about how to do it here.) Carve out time for the non-work activities that you regret missing. Schedule time with your family; go for a run; read a book. Fill your calendar with these important commitments, decrease your inventory of work time, and you'll find ways to become more efficient.

Not only will you expose the rocks, you just might enjoy the trip down the river.


 
 

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Fun With Statistics, Laffer Edition

good knowledge and argument

 
 

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via Evolving Excellence by Kevin Meyer on Jul 16, 2007

Several blogs are discussing the article in Friday's Wall Street Journal on how basically the entire world, with the notable exception of the United States, is reducing corporate income tax rates.

Last week lawmakers approved an 8.9 percentage point reduction in the corporate income tax rate. Too bad the tax cutters are Germans, not Americans. At least 25 developed nations have adopted Reaganite corporate income tax rate cuts since 2001. The U.S. is conspicuously not one of them. All of which means that the U.S. now has the unflattering distinction of having the developed world's highest corporate tax rate of 39.3%.

Not to mention the vast majority of the developing eastern Europe and Asian economies.

What do politicians in these countries understand that the U.S. Congress doesn't? Perhaps they've read "International Competitiveness for Dummies." In each of the countries that have cut corporate tax rates this year, the motivation has been the same -- to boost the nation's attractiveness as a location for international investment.

Basically they know about the dynamics of the Laffer Curve. Lower corporate tax rates lead to more, not less, tax revenue from business. As a very partial excuse for the short-sighted lovers of taxation,Laffer_curve it is somewhat counterintuitive. Until you dig deeper, and that's today's "fun with statistics." On the graph on the right, note how Ireland receives a higher percentage of GDP in tax revenue with much lower tax rates. And keep in mind that several of the countries on the right side of the curve, such as France, are aggressively reducing corporate tax rates.

As tax rates go up, the incentive to find and exploit loopholes goes up. If the tax rate gets high enough, companies shift more operations overseas. And if they continue to go up, such as the current Senate thinking about raising taxes on foreign-source income, those companies then move their corporate headquarters abroad. Already the number of major corporations relocating overseas has reached record levels, and even Microsoft occasionally threatens to move a few miles north to Canada.

But the impact doesn't end with high tax rates creating lower tax revenue and driving companies offshore.

For all the talk of "tax equity," this is also a recipe for further inequality by driving more capital offshore. Research has shown that high corporate tax rates reduce the rate of increase in manufacturing wages. For that matter, most economists understand that corporations don't ultimately pay any taxes. They merely serve as a collection agent, passing along the cost of those taxes in some combination of lower returns for shareholders, higher prices for customers, or lower compensation for employees. In other words, America's high corporate tax rates are an indirect, but still damaging, tax on average American workers.

And guess what... there's also an almost identical Laffer Curve for individual taxes. The more the government taxes, the more income is shifted, moved, hidden, and sometimes just not realized. So as we're fighting to remain competitive through the implementation of lean manufacturing and other methods, tax policy is making some companies ask "why bother?" and simply move overseas. As the WSJ concludes,

One immediate policy remedy would be to cut the 35% U.S. federal corporate tax rate to the industrial nation average of 29%. That's probably too sensible for a Congress gripped by a desire to soak the rich and punish business, but a Democrat who picked up the idea could turn the tax tables on Republicans in 2008. Meantime, as the U.S. fails to act, the rest of the world is looking more attractive all the time.

And that's today's edition of fun with statistics!


 
 

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Bottled Water Is Still A Scam

 
 

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via Anil Dash by Anil on Jul 03, 2007

Bottled water in America is generally less healthy than tap water, extraordinarily more expensive, and far more destructive to the environment. It's something I started blogging about years ago, and thanks to an an exceptional package of stories in Fast Company, I had a reminder to revisit the issue.

From my old post:

In case you don't know, bottled water is an incredible scam. I used to help out with running a water company when I was a kid, so I got a good background in the stringent set of requirements that utilities must meet when providing drinking water to a community. Generally, bottled water doesn't have to meet standards that are anywhere near as tightly regulated in regards to contaminants, filtering, or purity. Not to mention the fact that waterwhich stagnates in plastic containers on supermarket shelves frequently has a higher bacteria count than water from public utilities.

Meanwhile, the Fast Company article adds an incredible amount of new specifics, particularly about the explosive growth in sales of bottled water. As Charles Fishman says,

Bottled water is often simply an indulgence, and despite the stories we tell ourselves, it is not a benign indulgence. We're moving 1 billion bottles of water around a week in ships, trains, and trucks in the United States alone. That's a weekly convoy equivalent to 37,800 18-wheelers delivering water. (Water weighs 81/3 pounds a gallon. It's so heavy you can't fill an 18-wheeler with bottled water--you have to leave empty space.) Meanwhile, one out of six people in the world has no dependable, safe drinking water. The global economy has contrived to deny the most fundamental element of life to 1 billion people, while delivering to us an array of water "varieties" from around the globe, not one of which we actually need. That tension is only complicated by the fact that if we suddenly decided not to purchase the lake of Poland Spring water in Hollis, Maine, none of that water would find its way to people who really are thirsty.

water-bottle.jpg

It's worth reiterating that Aquafina and Dasani are just tap water. There's nothing wrong with that, since tap water is very good water -- it's just not worth paying 500 times as much for. I don't have any argument against the convenience factor, either, since it makes perfect sense to take water with you when you're on the go. You'll just get something that's got less bacteria and generally better quality if you fill your bottle from your tap. It's also worth checking out this story for the slideshows that are displayed alongside it; These usually just seem like blatant attempts for magazines to increase their page views online, but in this case they seem to have actually included original content and research.

Some of the other points made in the article:

  • Fiji Water produces more than a million bottles a day, while more than half the people in Fiji do not have reliable drinking water.
  • If the water we use at home cost what even cheap bottled water costs, our monthly water bills would run $9,000.
  • 24% of the bottled water we buy is tap water repackaged by Coke and Pepsi.
  • The bubbles in San Pellegrino are extracted from volcanic springs in Tuscany, then trucked north and injected into the water from the source.
  • We pitch into landfills 38 billion water bottles a year--in excess of $1 billion worth of plastic.
  • Worldwide, 1 billion people have no reliable source of drinking water; 3,000 children a day die from diseases caught from tainted water.

I'd encourage everybody to take a look at the Fast Company article -- it makes it clear that the costs of bottled water, aside from its extraordinarily expensive price, are simply not worth it. And that's not even taking into account the fact that a lot of experts think the next resource that will spark a wide-scale international conflict isn't going to be oil, but fresh drinking water.

Thanks to Lisa for the article link and to Philippe for the photo.


 
 

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Bill Gates, Ambition, Legacy, and Obligation

hi ashish,
how about lunching one day on baby carrots every week and collecting that money for donation ?...two weeks will translate to 1 child 1 year of food.

 
 

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via Anil Dash by Anil on Jul 07, 2007

I've followed the history of Bill Gates and his career and work since I was a kid. Though he's not nearly charismatic enough to inspire an army of fawning fanboys, the complexity and eccentricity of a lot of his choices makes his character endlessly fascinating to me. And of course, it is an extra bonus that most people confuse such an interest for uncritical adoration, which ain't the case.

I'm not a Bill Gates fanboy, I just think he's more ambitious and more likely to permanently change the world for the better than anybody else in the history of the technology industry.

Part of understanding why is having the proper perspective. I remember Microsoft's mission from when I was a young kid -- a computer on every desk and in every home. That mission, of course, had an implicit suffix of "...running Microsoft software". About 25 years into that mission, before Bill Gates had even turned fifty years old, Microsoft had achieved that goal. Think about that -- you set a goal as ambitious as you can imagine, and before your kids are even in high school, it's happened. What do you do when you've accomplished your biggest goal?

It's not a problem most of us ever have to deal with. Honestly, most of us that would even take the time to set such a goal would make it so big or so fuzzy it would be impossible to ever achieve. But by being just slightly specific, Microsoft under Bill Gates' direction achieved a seemingly-extraordinarily ambitious goal.

So, what next? You have to go for an even bigger goal. What's bigger than computers everywhere? How about curing malaria? And AIDS? That seems big enough. And the true innovation seems to be approaching those problems in an entrepreneurial way, with a big focus on accountability.

And after years of seeing his awkwardness in articulating the benefits of technology, it's startling to see just how good Gates is at telling this far more important story. You might have seen a link to Bill Gates' Harvard commencement address and probably thought "eh, I'll read it later". Go read it now: it's the kind of leadership and accountability that's been sorely missing from those in a position of power in the technology industry. Hell, it's the kind of message that's been curiously absent from the lips of nearly all of our leaders.

Just one highlight:

I remember going to Davos some years back and sitting on a global health panel that was discussing ways to save millions of lives. Millions! Think of the thrill of saving just one person's life - then multiply that by millions. ... Yet this was the most boring panel I've ever been on - ever. So boring even I couldn't bear it.

What made that experience especially striking was that I had just come from an event where we were introducing version 13 of some piece of software, and we had people jumping and shouting with excitement. I love getting people excited about software - but why can't we generate even more excitement for saving lives?

You can't get people excited unless you can help them see and feel the impact. And how you do that - is a complex question.

Still, I'm optimistic. Yes, inequity has been with us forever, but the new tools we have to cut through complexity have not been with us forever. They are new - they can help us make the most of our caring - and that's why the future can be different from the past.

The defining and ongoing innovations of this age - biotechnology, the computer, the Internet - give us a chance we've never had before to end extreme poverty and end death from preventable disease.

I'm sure those who make their decisions based on fashion and popularity contests won't want to give Gates the benefit of the doubt. But I'm okay with someone uncool doing the right thing on an unimaginably ambitious scale.


 
 

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The list of 4 lists...

interesting ones....maps to rahul garg's quote

 
 

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via Soaring on Ridgelift by 1vc on Jul 09, 2007

Whether you are the founder of a startup company or someone interviewing for an executive role in one, it's important to keep in mind the List of 4 Lists. Before you head off to your favorite book store, the List of 4 Lists isn't a book by some long expired philosopher - it's a thought exercise I use with early stage companies to get them to think outside the box.

The List of 4 Lists:

  • The list of things you KNOW.
  • The list of things you DON'T KNOW.
  • The list of things you ASSUME.
  • The list of things you DON'T KNOW YOU DON'T KNOW

Any of us looking at the business plan of a startup company can fill out the first two lists. It's easy; you have a set of knowledge and experiences whether gained through formal education or via post graduate education at U. of HK (University of Hard Knocks) that acts as review filters for the plan. You can look at the different risk factors (market, team, technology) and populate the lists - being a smart person you can then work to move items from the second list to the first by asking questions, research etc.

The third list isn't so easy - any business plan is based on a set of assumptions such as how long it will take to recruit people, develop the product, how much customers will pay for the product, etc. This isn't just about the formulas in the spreadsheet behind the modeled financials (although that is a good place to look for assumptions!) - It is about the thought process that went into building the plan. It is very helpful to make your assumptions explicit - it is the implicit assumptions that are difficult to test and often lead to nasty surprises.

The fourth list is the real challenge - it's a virtual list because the moment you identify something that should go on it, by definition you now KNOW YOU DON'T KNOW and it gets added to the second list. We always need to be on our guard and thinking about how to identify items for this fourth list - fortunately, one of the best ways to fill it is to remember that everyone has the same List of 4 Lists and THEY ARE DIFFERENT. This is one reason why a team of people is often far more effective than any individual. You can populate this virtual list by reviewing the plan as it unfolds with the executive team, cofounders, investors and advisors.

Most problems in business stem from the last two lists - assumptions prove to be wrong (or simply aren't recognized because with hindsight, it's clear they were wrong!) or something nails you in the back of the head that could have been anticipated if you'd been open to thinking about the fourth list.

Remember the List of 4 Lists!


 
 

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Wednesday, July 4, 2007

Interesting Study: Brand and Search

crux:
This is in line with the finding last year by German researchers who showed using MRI scans that well-known brands activate positive emotional responses in people's brains.

 
 

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via John Battelle's Searchblog on Jul 03, 2007

Thanks to reader JG for this interesting writeup of a recent study on how brands effect search results. From it:

Web searchers who evaluated identical search-engine results overwhelmingly favored Yahoo! and Google, providing evidence that people go for brand names on the Internet just as they do in the real world, according to new research presented at the Computer/Human Interaction 2007 Conference in San Jose, California....

Despite the results pages being identical in content and presentation, participants indicated that Yahoo! and Google outperformed MSN Live Search and the in-house search engine.

I also found this very interesting:

This is in line with the finding last year by German researchers who showed using MRI scans that well-known brands activate positive emotional responses in people's brains.

Link to the study. Link to the MRI study.


 
 

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The Evolving New Economy

no particular value, but interesting read if you are feeling down
factual knowledge:
Can we escape the Red Queen effect?

There's a powerful image that resonates in corporate boardrooms around the world - the image of the Red Queen running faster and faster just to stay in the same place. Adaptation in a world of more rapid change implies running faster just to stay in same place.

 
 

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via Evolving Excellence by Kevin Meyer on Jun 27, 2007

Each year an annual conference called Supernova is held to discuss the impact of technology on the world. Lots of deep thinkers attend, many of whom have actually worked in the real world and can therefore pontificate and bloveate meaningful analyses. I've attended occasionally in the past but wasn't able to attend this year. However John Hagel of Edge Perspectives posted several observations predominantly based on his own presentation at the conference. They can be rather esoteric to those of us in the knuckle-dragging manufacturing world, but enlightened leaders may want to at least mull them over a bit. The world is changing, like it or not. John's observations are actually thought-provoking questions.

Questions are often as valuable as answers It's appropriate to step back occasionally and reflect on what we don't know, rather than simply sharing what we know. In times of rapid change, asking the right questions is often as important as the answers - at least they help us figure out where we might start looking for answers.

So let's here are the paraphrased versions of a couple of his more interesting questions.

What if there is no equilibrium?

We all understand that the component technologies of our new infrastructure continue to advance at exponential pace. In fact, this is the one central difference between this new generation of infrastructure and all the previous generations of infrastructure that shaped our economies in the past. All of these earlier generations were characterized by a major technology breakthrough, followed by the adoption of key standards and a diminishing rate of performance improvement.

Our new infrastructure defies this pattern and proceeds with exponential rates of performance improvements. Here's the paradox: at the same time, we cling to traditional equilibrium concepts and institutions that emerged and prevailed in more stable times. Nathan Mhyrvold highlighted in his talk yesterday the contrast between the exponential advance of technology performance and the linear thinking of most executives. Clayton Christensen got the attention of the business world with his perspective on disruptive innovation - but even that is a punctuated equilibrium view - it holds on to the assumption that equilibrium will eventually return.

Early conventional wisdom suggest that these architectures should focus on agility and flexibility, but that misses the real opportunity - balancing agility with the persistence and stability required to build and deepen long-term trust based relationships. Being able to discern what needs to change and what needs to remain stable may be the greatest challenge of all.

I find the key phrase to be "the real opportunity - balancing agility with the persistance and stability... being able to discern what needs to change and what needs to remain stable..." That is what many lean companies are doing. They focus on standard work and defined, repeatable processes while also leveraging the power and magic of kaizen and kaikaku. Always agile, always changing, but still standardized.

Can we escape the Red Queen effect?

There's a powerful image that resonates in corporate boardrooms around the world - the image of the Red Queen running faster and faster just to stay in the same place. Adaptation in a world of more rapid change implies running faster just to stay in same place.

Product and process innovation only provides temporary relief for the Red Queen effect as companies become more adept at copying the advances of others. We need to harness institutional innovation and move from scalable efficiency to scalable learning so that we can begin to learn faster and find ways to get ahead of the pack in a more sustainable fashion.

This time the key statement is "harness institutional innovation and move from scalable efficiency to scalable learning." Taking advantage of the knowledge, creativity, and experience of people rather than treating them as a simple set of hands that needs to be optimized in a quest for additional efficiency. Contrast how true lean companies grow by leveraging their employees and utilizing the additional capacity created by lean efficiencies to how companies like Whirlpool lay off and then re-hire less experienced people in the desire to save a few financial bucks. Companies that chase low labor from country to country without fundamental innovation and improvement are Red Queens.

How are pull platforms likely to evolve?

As the pace of change accelerates, we are in the midst of a broad transition in terms of how we access and mobilize resources. As JSB and I have written elsewhere, we are moving away from push programs that attempt to forecast demand and make sure that the necessary resources are available when and where needed. In their place, we are seeing the emergence of much more flexible pull platforms that help people connect with the resources that are most relevant to them whenever and wherever they need the resources.

Push programs treat people as passive consumers (even when they are producers like workers on an assembly line) whose needs can be anticipated and shaped by centralized decision-makers. Pull platforms treat people as networked creators (even when they are customers purchasing goods and services) who are uniquely positioned to transform uncertainty from a problem into an opportunity.

The pull platforms that we now have are only the earliest stages of development. To harness the full potential of these pull platforms we will need to move to much more robust federation governance structures that accommodate services from a growing number of independent and diverse participants. The lean manufacturing approaches of leading edge manufacturers succeed only because they dramatically narrow the number of participants. Different governance structures are likely to be required to scale pull platforms.

We've blogged about the "pull economy" before. That's lean, pure and simple, and in my view is probably the most disruptive as well as critical change already in progress.

John Hagel poses many more similar questions. Take some time to read them here.


 
 

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Be Careful What You Measure

labels: general timeless advice

 
 

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via Evolving Excellence by Kevin Meyer on Jun 30, 2007

Have you taken a hard look at your metrics recently? Not the values and trend, but the underlying attribute being measured. Is it really an effective reflection of some facet of business success? A project by the federal government should teach us a couple lessons.

From the Cato-at-Liberty blog,

One of the behind-the-scenes initiatives of President Bush's budget staff the past six years has been something called the Program Assessment Ratings Tool (PART) analysis. It's an effort to measure the "effectiveness" and "efficiency" of nearly 1,000 federal programs. Each program is graded on how well it achieves its "goals."

Sounds good. About time we measure the effectiveness of programs, right? I wonder what the results show. In Tuesday's Investor's Business Daily op-ed section, Ernest Christian and Gary Robbins take a look at the results to date of the effort:

Congress is about to wave its wand over nearly $1 trillion of additional "discretionary" spending that will, among other things, perpetuate or increase funding for nearly 500 expenditure programs that are not even "moderately effective," according to the Office of Management and Budget. This includes more than 200 expenditure programs that have failing grades of D or F. In these cases alone, the cost of government incompetence is over $250 billion per year.

The list of programs with the lowest grades might make any supporter of limited government point wildly and say, "Told you so!" This rogue's gallery includes the Department of Housing and Urban Development's pork-filled Community Development Block Grants, the Department of Education's Even Start literacy program, and Amtrak.

There we go! All kinds of waste just begging to be removed. Don't even think about raising my taxes, and these are probably the last people I want in charge of my healthcare and retirement. But I wonder what some of the more "efficient" programs are...

But what about the ones that received the equivalent of an A or B grade - those programs that are "effective" or "moderately effective"? That list includes homeless assistance grants, agricultural export subsidies, Indian housing loan guarantees, the non-insured crop assistance program, and corporate welfare programs like the Trade and Development Agency which subsidizes overseas demand for the products of various corporations.

Hmmm... uh oh. The government is efficient at spending money on corporate welfare and helping out people that decided a government bailout was cheaper than buying insurance?

Sure, knowing when the government is losing money to fraud or mismanagment is important. But it makes more sense to determine whether these programs should exist at all before deciding what they should be "efficient" at doing. Besides, an efficient but unjustified wealth-redistribution program might actually be worse than an inefficient one. The former will likely be better at finding innovative ways of expanding the scope of its operations.

And that's also the lesson for businesses and other organizations. Take the time to really understand what you are measuring, and whether a positive trend is really a positive. Many of us know (and some of us have experienced) the saying of "you can sell yourself out of business" when you don't understand how cash flow plays into converting the top line into the bottom line. I would add you can "streamline your way out of business" if you find ways to create waste very efficiently.


 
 

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The Obesity Epidemic

philosphical kind of article...not much value but common observation across multiple fields
interesting lines:
Ecology teaches that whenever an excess of organic matter arises anywhere in nature, creatures large and small inevitably step forward to consume it, sometimes creating whole new food chains in the process.
Now we have 32MB Palm PDAs, 8GB iPhones, 80GB computer hard drives, and a lot of it (most of it?) is filled with garbage. It's the electronic equivalent of the obesity epidemic.

 
 

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via Evolving Excellence by Dan Markovitz on Jul 03, 2007

On my too-frequent flights to New York recently, I started reading Michael Pollan's book, The Omnivore's Dilemma. It's a trip up and down the food chain from a naturalist's perspective, and one of his first stops is an examination of corn.

Government policies over the years have led to overproduction of this crop, from 4 billion bushels in 1970 to 10 billion bushels today. At the same time, because supply exceeds demand and prices are so low, federal government payments to farmers -- for corn alone -- comes to slightly more than $4 billion.

There are plenty of lean lessons here, from the folly of "push" production (even in food) to government muda. But what's really interesting is Pollan's view of the result of this overproduction:

Another way to look at this 10-billion-bushel pile of commodity corn -- a naturalist's way of looking at it -- is that industrial agriculture has introduced a vast new stock of biomass to the environment, creating what amounts to an imbalance -- a kind of vacuum in reverse. Ecology teaches that whenever an excess of organic matter arises anywhere in nature, creatures large and small inevitably step forward to consume it, sometimes creating whole new food chains in the process. In this case the creatures feasting on the surplus biomass are both metaphorical and real: There are the agribusiness corporations, foreign markets, and whole new industries (such as ethanol), and then there are the food scientists, livestock, and human eaters, as well as the usual array of microorganisms (such as E. coli O157:H7).

What's involved in absorbing all this excess biomass goes a long way toward explaining several seemingly unconnected phenomena, from the rise of factory farms and the industrialization of our food, to the epidemic of obesity and prevalence of food poisoning in America. . . .

As I read this, I thought about people's struggle to keep up with their work. Knowledge workers are being crushed by the weight of the email and data they have to manage. As I pointed out in another post, the increase in data storage at Chevron is growing by 60% a year, resulting in employees losing from one-and-a-half to three days per month simply looking for (!) information. And there's the recent story in the Washington Post about the venture capitalist who declared "email bankruptcy" because he couldn't keep up with his email.

You can point fingers in many directions in trying to identify the causes of this tidal wave of (often useless) information. And certainly, our own poor work habits often exacerbate the difficulty of staying on top of it all.

But I wonder if Michael Pollan hasn't hit upon the real root cause of the problem. Perhaps the supply of cheap computing power and storage capacity has also created an imbalance in nature. As a result, we've spawned new creatures to feast on the surplus "electronic biomass" -- stupid and irrelevant emails, forwarded jokes, multiple copies of "FY2007budgetfinalfinalv5.doc," etc. Something has to consume those available bytes.

I read somewhere that the computer on board the Apollo 11 Lunar Excursion Module had a whopping 32KB of RAM. Imagine: NASA landed people on the moon and brought them back with 32KB. Presumably they didn't have Tetris installed, either -- they didn't have a kilobyte to spare in their work. Now we have 32MB Palm PDAs, 8GB iPhones, 80GB computer hard drives, and a lot of it (most of it?) is filled with garbage. It's the electronic equivalent of the obesity epidemic.

But is the information obesity coming from us through poor work habits or more complex jobs, or is it simply an inescapable natural law like entropy or F=ma? Are we doomed to ever-greater demands on our time from email, text messages, and the like? Or can we fight the explosion of electronic garbage by going back to older technologies like the telephone or (gasp!) face-to-face conversations?

I'll be thinking about this over my next Supersized Big Mac and fries.


 
 

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