Showing posts with label Modeling and Simulation. Show all posts
Showing posts with label Modeling and Simulation. Show all posts

August 31, 2012

Can a Computer Run the Economy?

I am not talking about socialism or totalitarianism, but about computers and artificial intelligence.

For a long time, we have seen political infighting and finger-pointing stall progress on creating jobs, balancing trade, taming the deficits, and sparking innovation. 

But what if we somehow took out the quest for power and influence from navigating our prosperity?

In politics, unfortunately no one seems to want to give the other side the upper hand--a political win with voters or a leg-up on with their platform.

But through the disciplines of economics, finance, organizational behavior, industrial psychology, sociology, geopolitics, and more--can we program a computer to steer the economy using facts rather than fighting and fear?

Every day, we need to make decisions, big and small, on everything from interests rates, tax rates, borrowing, defense spending, entitlements, pricing strategies, regulating critical industries, trade pacts, and more.

Left in the hands of politicians, we inject personal biases and even hatreds, powerplays, band-standing, bickering, and "pork-barrel" decision making, rather than rational acting based on analysis of alternatives, cost-benefits, risk management, and underlying ethics. 

We thumb our noises (rightfully) at global actors on the political stages, saying who is rational and who is perhaps just plain crazy enough to hit "the button."

But back here at home, we can argue about whether or not the button of economic destructionism has already been hit with the clock ticking down as the national deficit spirals upward, education scores plummet, and jobs are lost overseas?

Bloomberg BusinessWeek (30 August 2012) suggests using gaming as a way to get past the political infighting and instead focus on small (diverse) groups to make unambiguous trade-off decisions to guide the economy rather than "get reelected"--the results pleasantly were cooperation and collaboration.

Yes, a game is just a game, but there is lesson that we can learn from this--economic decision-making can be made (more) rationally by rewarding teamwork and compromise, rather than by an all or nothing, fall on your sword, party against party, winner takes no prisoner-politics. 

I would suggest that gaming is a good example for how we can improve our economy, but I can see a time coming where "bid data," analytics, artificial intelligence, modeling and simulation, and high-performance computing, takes this a whole lot further--where computers, guided and inspired by people, help us make rational economic choices, thereby trumping decisions by gut, intuition, politics, and subjective whims .

True, computers are programmed by human beings--so won't we just introduce our biases and conflict into the systems we develop and deploy?

The idea here is to filter out those biases using diverse teams of rational decision-makers, working together applying subject matter expertise and best practices and then have the computers learn over time in order to improve performance--this, separate from the desire and process to get votes and get elected.

Running the economy should not be about catering to constituencies, getting and keeping power for power sakes, but rather about rational decision-making for society--where the greatest good is provided to the greatest numbers, where the future takes center stage, where individuals preferences and rights are respected and upheld, and where ethics and morality underpin every decision we make.  

The final question is whether we will be ready to course-correct with collaboration and advances in technology to get out of this economic mess before this economic mess gets even more seriously at us?

(Source Photo: here with attribution to Erik Charlton)

Share/Save/Bookmark

February 11, 2012

Asteroid Killer--That's A Relief!


For those of you who have seen any of the numerous movies about asteroids hitting Earth--such as Armageddon, Deep Impact, and Asteroid to name a few--you know that in most cases this is considered an Extinction-Level Event (ELE).

In other words, what the impact of the asteroid and the resulting tsunamis do not destroy, the dust and debris causing a deep freeze over the earth will. This would be like the Ice Age, although this time, we would be the dinosaurs!

However, a new supercomputer at Los Alamos National Lab running 32,000 processors has been able to demonstrate our ability to explode a 1 megaton nuke near the asteroid on a trajectory with Earth and literally blow it to smithereens. 

The shock wave from blast would smash the composite rocks of the asteroid against each other, and this would shatter them, and disrupt the pending destruction here on Earth. 

All this talk about destroying Asteroids makes me remember back to when I was a kid and used to play this Atari game called Missile Command, where we would shoot down thermonuclear missiles--they could've been asteroids for all we knew--before they hit us.

However, in the game, you eventually missed--and your base stations and ability to shoot were destroyed after being overcome by the number of incoming missiles--that was certainly a bummer, even though the game was fun especially with friends. 

I am relieved to see the new simulations and projections that indicate that given enough warning, we have the ability to take down an incoming asteroid.

Life imitating art--I certainly hope Los Alamos's new calculations are right and that if and when the time comes, we can get a very good shot at it!

Share/Save/Bookmark

April 17, 2011

Holograms - Projecting Soon

I think Holograms are the next big thing.

This example of a hologram on an an iPhone App is pretty amazing as an early version of what is to come.

Just wait for hologram phone calls and meetings and integration with everything social media.

I see things like avatars--graphical representations of users-- as a precursor to actual 3-D projected images of ourselves that will be sitting in the classroom, going to the office, and even interacting socially like going on dates with our favorite other.

This is going to make things like Skype, Facetime, and Telepresence just baby steps in our ability to project ourselves across space and time and "be there" in ever more realistic ways participating and interacting with others.

As part of a training class a number of year ago already, I had the opportunity to see a spatial hologram that was very cool. So holograms are not limited to only people but entire environments that can be virtualized and this gives us the opportunity to test new ways of behaving and model and simulate new worlds.

This iPhone App is just a teaser of what is coming.

Share/Save/Bookmark

February 8, 2010

From Planning to Practice

Real planning is hard work. I’m not talking about the traditional—get the management team together, offsite for a few hours or days and spell out a modified mission and vision statement and some basic goals and objectives—this is the typical approach. Rather, I am referring to thinking and planning about the future with a sense of urgency, realism, and genuine impact to the way we do our jobs.

In the traditional approach, the management team is focused on the planning session. They are engaged in the planning for a short duration, but when back in the office, they don’t go back in any meaningful way to either refer to or apply the plan in what they or their employees actually do. The plan in essence defaults to simply a paperwork exercise, an alignment mechanism, a check box for the next audit.

In contrast, in a comprehensive planning approach, the focus is not on the planning session itself, but on the existential threats and opportunities that we can envision that can impact on the organization and what we are going to do about it. We need to look at for example: What are our competitors doing? Are there new product innovations emerging? Are there social and economic trends that will affect how we do business? How is the political and regulatory environment changing? And so on. The important thing is to think through/ work through, the impact analysis and plan accordingly to meet these head-on.

This is similar to a SWOT analysis—where we evaluate our Strength, Weaknesses, Opportunities, and Threats, but it differs in that it extends that analysis portion to story planning (my term), where the results of SWOT are used to imagine and create multifaceted stories or scenarios of what we anticipate will happen and then identify how we will capitalize on the new situation or counter any threats. In other words, we play out the scenario —similar to simulation and modeling—in a safe environment, and evaluate our best course of action, by seeing where the story goes, how the actors behave and react, and introducing new layers of complexity and subtext.

Harvard Business Review (HBR), Jan-Feb 2010, has an article called “Strategy Tools for a Shifting Landscape” by Michael Jacobides that states “in an age when nothing is constant, strategy should be defined by narrative—plots, subplots, and characters---rather than by maps, graphs, and numbers.”

The author proposes the use of “playscripts” (his term), a scenario-based approach for planning, in which—“a narrative that sets out the cast of characters in a business, the way in which they are connected, the rules they observe, the plots and subplots in which they are a part, and how companies create and retain value as the business and the cast changes.

While I too believe in using a qualitative type of planning to help think out and flesh out strategy, I do not agree that we should discard the quantitative and visual analysis—in fact, I think we should embrace it and expand upon it by integrating it into planning itself. This way we optimize the best from both quantitative and qualitative analysis.

While numbers, trends, graphics, and other visuals are important information elements in planning, they are even more potent when added to the “what if” scenarios in a more narrative type of planning. For example, based on recent accident statistics with the car accelerators (a quantifiable and graphical analysis), we may anticipate that a major foreign car company will be conducting a major recall and that the government will be conducting investigations into this company. How will we respond—perhaps, we will we increase our marketing emphasizing our own car safety record and increase production in anticipation of picking up sales from our competitor?

Aside from being robust and plausible, the article recommends that playscripts be:

· Imaginative—“exploring all the opportunities that exist.” I would also extend this to the other relevant element of SWOT and include envisioning possible threats as well.

· Outward-facing—“focus on the links a company has with other entities, the way it connects with them and how others perceive it in the market.” This is critical to take ourselves out of our insular environments and look outside at what is going on and how it will affect us. Of course, we cannot ignore the inner dynamics of our organization, but we must temper it with a realization that we function within a larger eco-system.

To me, the key to planning is to free the employees to explore what is happening in their environment and how they will behave. It is not to regurgitate their functions and what they are working on, but rather to see beyond themselves and their current capabilities and attitudes. Life today is not life tomorrow, and we had better be prepared with open minds, sharpened skills and a broad arsenal to deal with the future that is soon upon us.


Share/Save/Bookmark

September 21, 2009

Testing EA in Virtual Reality

In enterprise architecture, we develop IT targets and plans for the organization, but these are usually not tested in any meaningful or significant way, since they are “future tense”.

Wouldn’t it be incredible to be able to actually test EA hypotheses, targets, and plans in a virtual environment before actually setting off the organization in a specific direction that can have huge implications for its ability to conduct business and achieve results?

MIT Technology Review, in an article entitled “The Fleecing of the Avatars” (Jan/Feb 2008) addresses how virtual reality is being used to a greater extent to mimic and test reality.

One example of the booming virtual world is Second Life, run by Linden Labs. It has 10,000,000 subscribers and “about 50,000 are online at any one time.” In this virtual world, subscribers playing roles as avatars “gather to role-play reenactments of obscure digital Star Trek cartoon episodes, build and buy digital homes and furniture, and hang out on digital beaches.”

However, more and more virtual worlds, like Second Life, are being used by real world mainstream businesses. For example, many companies are developing a presence in the virtual world, such as Dell with a sales office in Second Life, Reebok a store, and IBM maintains business centers in this virtual world. Further, “the World Bank presented a report in Second Life about business development.”

“But big companies like Sun, Reebok, and IBM don’t really do business in virtual worlds; they ‘tunnel’ into them. [In other words,] To close a deal, you need to step out of the ‘sim’ and into the traditional Sun or Reebok or IBM website.”

The development of company’s virtual presence online and their connection back to the real world is potentially a precursor to planning disciplines like EA testing out hypotheses of targets and plans in virtual reality and then actually implementing these back in the real organization.

Others are actually planning to use virtual worlds to test and conduct research. So there is precedent for other disciplines such as EA. For example, Cornell’s Robert Bloomfield, an experimental economist, “conducts lab research—allowing 20 students to make simulated stock trades using real money…and seeing how regulatory changes affect their behavior. He envisions a day when he can do larger studies by setting up parallel virtual worlds. ‘I could create two virtual worlds, one with legal structure, one with another, and compare them…I might lower the capital-gains tax in one and see how business responds. There are things I can’t do with 20 people in a classroom but I can do with 2,000 or 20,000 people in a virtual world.”

Could enterprise architecture do something similar in a virtual world? For example, could we test how business processes need to change when new technology is introduced or how information sharing improves with better architectures for discovering and exchanging data? How about testing people’s reactions and behavior to new systems in a broader virtual world instead of with a more limited number of customers in user acceptance testing? Another possibility is testing the effectiveness of new IT security in a virtual world of gamers and hackers?

Modeling and simulation (M&S) can improve enterprise architecture by testing plans before deploying them. We need to to hire and train people with knowledge, skills, and experience in the M&S discipline and with tools that support this. Then we can test hypothetical return on investment for new IT investments before we open our organizational wallets.


Share/Save/Bookmark