Consultant's View, 2010

January 2010

Fears and Freedom

The reaction to the Underwear Bomber shows some of the nature of human society. Ordinary American citizens jumped in to subdue him instead of waiting for government to act. Now, the TSA reacted with a bunch of new rules and regulations. Some people love the new regulations and others chafe under them.

How to Kill a Great Company - Part II

The fall of Richard Nixon, the almost bankruptcy of Salomon Brothers, and the demise of the law firm of Jenkins and Gilchrist all show one of the fastest ways to destroy something good. In these cases, top management knew about a problem and chose to hide and defend it rather than to cut their losses.

What do we really know?

Have you ever run into someone who was totally convinced of something that you knew to be wrong? While this is common in political fields, it happens also in the business world. This is a type of ignorance that is not easily cured.

Let's Celebrate Rascals

Recently, Charlie Wilson died. He was one of the "rascals" in American life. He was known for the ladies and the drinking - and also for taking exceptional action to help the Afghan fighters push back the Soviets. In his honor, it is time to celebrate American rascals.

Project Failure

Projects often fail. They either never finish or wind up over budget and way late. Often, there are specific issues that are blamed for the project failure. It is rare that the true cause of the failure are those specific issues. Instead, it is how we react to those issues that cause the project to fail.

Top Sellers

Every recruiter knows that their customers want only the best people. They are constantly asked to deliver "top producer" sales people. Yet, for all their efforts, most recruitments fail. Recruiting fails to deliver "top producers" because of both demographics and the structure of sales.

Power Corrupts

"And remember, where you have a concentration of power in a few hands, all too frequently men with the mentality of gangsters get control. History has proven that. All power corrupts; absolute power corrupts absolutely." Lord Acton.

We all have seen that last part of the quote. Yet, the human dynamic that occurs when someone has a position of power is something that we rarely take a hard look at.

Sunk Costs

One of the biggest impediments to moving ahead is when we cling to "sunk costs". This is especially true with software systems and training. Yet, people are hesitant to make the changes that would help them survive these changes.

White Space Teams

Corporations today are using "White Space" teams to bring out radically new products. A "White Space" team is a team of marketers, developers, and executives who are tasked with finding a new market and delivering something to that market. What makes a "White Space" team different from a task force within other companies is

Cloud Computing

A lot of people are talking about "Cloud Computing" as if that were the wave of the future. While "Cloud Computing" has a place in the future, it is not the only answer and adoption depends not just on the prices, but also on features and security.

Cloud Computing Security

Security on "Cloud Computing" is a big issue. While we have not heard of people being hacked while their data is on the "cloud", that is only because the technology is too new for the big stories to leak out. Anywhere data is - it can be compromised. It can be compromised by an outside attack or from within the "cloud" provider.

Make fewer decisions!

Warren Buffett says that he only has to make one major decision a year in order to keep on making oodles of money.

New Wave for Payments?

According to Warren Buffett, there are three "I"'s in any business cycle; Innovators, Imitators, and Idiots. One way to tell when the "Idiots" have taken over is when price is the only differentiator. When we see that, it is time to start watching for new innovation to happen in that business. In most markets, the innovation starts at the low end, in the business that the established companies are not willing to deal with.

People not Projects!

Alan Kay (the inventor of the personal computer and other things) recently stated that the whole thing got started because they were funded under the concept of "funding people not projects, visions instead of goals". In short, the agency that funded his work gave money to a few smart people and stepped back to see what they would develop.

The Importance of Forgetting

Brain researchers are learning that memory is not just about remembering something. Often, equally important is the ability to forget something. Our society is built based on the ability to forget. Forgetting is not just "not remembering". It is also about making judgments about what is important to remember.

Not So Anonymous

A researcher at the Electronic Frontier Foundation reported that most computers give enough information when browsing to be able to identify "this computer". He found that browsers are able to give back to the host computer enough information so that subsequent actions could be identified as coming from that same computer. And other research is showing that all browsers "leak" information when browsing.

Custom Loyalty Tracking System

We just delivered a custom loyalty data capture system for a client. This is a good time to review why someone might want to have such a custom loyalty system. Rarely can a merchant point to how that loyalty package is making them money. Loyalty packages can be very profitable to the merchant - when used correctly. Customer loyalty occurs when the merchant has

Leadership

Walk into any business section of a bookstore and you will find a number of books on leadership. You can learn from Genghis Khan, Fortune 50 CEO's, former presidents, and more. So easily we forget that leadership is not a "plug and play" skill or exercise. One type of leadership may work in one situation but totally fail in another.

Why Outsource or do it in house?

Throughout the history of computing, companies have switched between relying on outside vendors for all their computer needs, bringing it in-house, outsourcing it again, restructuring and bringing it back in, and on and on. There are a number of factors that help identify when a project can be outsourced and when the resources need to be found within the company.

Save the Ideas!

The October issue of Harvard Business Review has an interesting article on how to keep good ideas alive. All of us come up with ideas. The challenge is in getting other people to adopt our ideas and make them happen. That isn't a matter of logic, but of human interactions.

What are the real risks?

Jeff Ma was one of the members of the MIT blackjack team that took millions from casinos. He is now training people for the gambling tables. One challenge he runs into is that most people do not understand the real risks they are taking and how risks change over time. This is true also for business.

Gaining Wealth or Importing Money?

Over the last year, the Federal Reserve has been pumping money into the system to try to prevent deflation and restore inflation. The policy has been a roaring success. In the last year, prices and wages have gone up by 30%. Where? This inflation points to a human tendency.

What Harm is in Not Acting?

People do not always act when we need to. We have all seen situations where people stay in a bad situation, put up with events that we would not endure, and otherwise not act to improve themselves. Businesses stay in lines of business that should have been changed or shut down long ago. Even Warren Buffet stayed with the original textile company long after it was no longer very profitable. Why do people not take the actions they need to take?

Will your company lose the cyber war?

There is a roundtable discussion in the December Communications of the ACM on the cyber war that companies are engaged in - even though they may not know it. The way companies are being attacked through the internet has changed dramatically over the last few years. Now we are facing not just "big time" criminal efforts, but also intelligence services looking to steal industrial capability. The difference is huge.

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