Showing posts with label Long-term. Show all posts
Showing posts with label Long-term. Show all posts

May 26, 2018

Amazon's Dangerous Genius

I am marveling at the Genius of Amazon and Jeff Bezos but also concerned about their future direction. 

Traditionally, they have invested for the long-haul!

For years, Amazon never made a dime, actually operating at a loss.

But all the time making long-term investments in infrastructure (warehouses, supply chain, logistics, etc.) and in customer acquisition. 

Their great selection, reasonable pricing, free shipping, and easy return policy lured hundreds of millions of people to drop the brick-and-mortar stores and even other online retailers to go Amazon all the way. 

Most people I know get virtually everything and anything on Amazon these days. 

Of course, the fear always was that Amazon would become such a dominant player and monopoly that no one else could compete. 

For a long time, they didn't even charge sales tax!

It seems people can't even imagine not having Amazon--where in the world would they shop and get all their stuff in 2-days or less (Prime Customers) and still be able to return all the crap they don't even want. 

So here is the rub.

Now that Amazon is so dominant, guess what?  They are raising the Prime Rates and cutting back on returns--with customers actually being banned for returning too much. 

Ah, the lure, bait and switch. 

Amazon got us all as their slave customers--and we let them and love them for it. 

And after they snared us with all the convenience and security of being able to return stuff, they pull the rug and what can you do, but cry foul?

I love Amazon for their genius and what they have done for eCommerce, but I don't like that they've built in a sense a dark empire to prey on their loyal customer base. 

Mr. Bezos, here is my message to you...

Please stay true to your ideals of customer-centricity and long-term investment in the company that has been the foundation for what you have built into such a retail juggernaut.  

Keep valuing your customers and serving them well and not trading them in for short-term profit gain.

In the end, that is a winning strategy that won't land you in either regulatory hell and/or antitrust action to then force you to bend your knee or your ultimate breakup. 

Remember, you have one chance to make the right decision for Amazon or I fear that it's not product returns that you'll be for long worrying about. ;-)

(Source Photo: Andy Blumenthal)
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December 2, 2017

Our Forefathers Were Planners And So Are We

Thank you to Rabbi Haim Ovadia for his speech today at Magen David Synagogue on the topic of how our forefathers in the Bible were planners and so are we today. (Note: some of the thoughts below are directly from Rabbi Ovadia and others are added by me.)

In the Biblical story of Jacob, there are numerous examples teaching us the importance of planning.

1) Shepherds vs Hunters:  Jacob was a shepherd versus his brother Esau who was a hunter.  Shepherds have a long-term outlook with their animals, tending to them and caring for them over the long-term, while hunters go out for the kills to eat for that day. 

2) Working for Rachel and Leah vs. Selling the Pottage:  Jacob worked for 7 years for Rachel and another 7 for Leah--this was the long-term view and commitment to work for Lavan in order to marry his daughters. In comparison, Esau came in hungry from the field and sold his birthright for the immediate gratification of a bowl of pottage.

3) The Plan to Take Esau's Blessing: Rebekah worked with Jacob to prepare meat for Isaac and put hair and clothes on Jacob that made him look and seem like Esau, so Jacob could get the blessing from Isaac, while Esau was still out hunting in the field. 

4) Dividing his Camp in Two: Jacob sent messengers (i.e. reconnaissance) to see and plan for what Esau was doing in coming to meet him. When the messengers returned with word that Esau was coming with 400 men, Jacob planned for the worst, dividing his camp in two, so should one peril the other could survive. Additionally, Jacob prayed and sent rounds of gifts to Esau and also presented himself to Esau before his beloved wife Rachel and son Joseph in the safety of the rear. 

Long-term planning has been fundamental to the Jewish people throughout history and to modern times:

1) "People of the Book" - The Jewish people are known as "the people off the book" for the devotion to Torah study, learning, and continually investing in education, which is a view for long-term investment and success.   

2) Good Deeds to Inherit The World To Come - Fundamental to Jewish belief is that this earthly world is just a "corridor" to the World to Come.  We do charity and good deeds, not only because it's the right thing to do (certainly!), but also because we believe that these merits will help us long-term when we pass, and go to the spiritual next world, Heaven. 

3) Believing and Praying for the Return to The Promised Land - For 2,000, the Jewish people never gave up hoping and praying on the deliverance of G-d's promise to return them from exile to the Promised Land.  This was a long-term view that helped sustain the Jewish people throughout their far-flung exile and through millennium of persecution and genocide.
Ezekiel 11:17: "Thus says the Lord God: I will gather you from the peoples, and assemble you out of the countries where you have been scattered, and I will give you the land of Israel."
4) Waiting 6,000 years for the Messiah: For 6,000 years, the Jews have maintain faith and plan for the coming of the Messiah, the rebuilding of the Temple and the ultimate redemption of the world.  
"(Ani Ma'amin) I believe in complete faith in the coming of the Messiah...Even tough he may tarry, none-the-less, I will wait for him."
Like our forefathers, it is critical to maintain faith in the Almighty and practice long-term planning as keys to success in life. 

If we take the long-view, we can overcome so many short-term challenges, obstacles and even suffering--believing, praying planning, and doing for a better, brighter future. ;-)

(Source Photo: Andy Blumenthal)
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June 13, 2015

A Delicate Balance

I love this desk doodad that I found in the gallery. 

Two guys perched at opposite ends of a strewn out ladder, balancing precariously on top of a sphere (maybe the Earth). 

Take a step forward or backwards and it can upset the balance of things and everyone falls down. 

Don't move--and you are in perpetual stasis--just balancing with the other guy so as not ruin the equilibrium of things, you're stuck in limbo.

Maybe this is the definition of either doing nothing and going nowhere or creating a lose-lose situation, where you try to benefit yourself at the expense of others and down you both go. 

What's the only way out?

You both have to step forward and advance together--create a win-win--the balance and fairness is maintained and both move closer to each other and the center of things. 

Climbing the ladder is really a balancing act with others you work with.

I tell people at work who get into it with each other, "listen, what's more important winning the petty argument OR building the relationship with the other folks who presumably you'll be working with for a long time to come?"

You may be able to talk or strong arm your way into getting what you want now, but do lasting damage to the relationship. 

Unless, it's a matter of right and wrong, make your best argument, but then be willing to compromise, especially if it means better teamwork and success in the longer scheme of things. 

Being task/goal-oriented is great, but drop the ball on being people-oriented and it's all be a big bust. ;-)

(Source Photo: Andy  Blumenthal)
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April 12, 2013

Tiptoeing Or Delivering A Knockout Punch

Russia (and many others countries) develop some really kick-a*s weapons--especially, when they are so simple, yet so devastatingly effective. 

Like this TOS-1A heavy flamethrower system--it is a multi-rocket launcher mounted on a T-72 main battle tank chassis. 

The TOS-1A carries 30 (newer version 24) 220-mm incendiary or thermobaric unguided rockets that it can shoot up to 3 km (newer version 6 km), and it destroys everything within 300 square meters using high-pressure and temperature.

What is cool is that the technology seems boiled down to the basics--shoot and eliminate. And when multiple TOS-1As roll unto the battlefield--they unleash what looks like a ruthless barrage of destructive fire. 

Of course, precision targeting weapons have the added benefit of mitigating civilian casualties--but from the looks of things, that is not what this weapon is all about.

The question is do you go half way or finish the job--do you hit below the belt or keep it a clean fight?

In war, if you leave the enemy intact or with fighting capabilities, then you may just have to fight them another day. 

While the rules of war protect people from the cruelties of all out hostilities, we need to make sure that in the end, it keeps them safe over the long-term, and does not just prolong the inevitable cat-fight.

Good, kind, and just people often don't feel comfortable delivering a knockout punch, but sometimes (not all the time) that is just what is needed to restore the peace.  ;-)


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October 28, 2012

A Bottle Revolution


How many of you feel sort of disgusting every time you take out the trash with bottles and containers?

According to Earth911, only 27% of plastic and 25% of glass ends up getting recycled, with the majority ending up instead in landfills. 

This is one reason that I really like the new eco.bottles made by Ecologic, a sustainable (i.e. green) packaging company.

The containers are made of two parts:

- The inner plastic pouch that holds the liquid and snaps into the second part.
- The outer shell made of 100% recycled cardboard and newspaper (and in turn is 100% recycable again). 

These containers result is a net 70% plastic reduction!

Yet, they have the same strength and functionality of plastic containers, with comparable results in drop, ship, and moisture tests.

And companies like, Seventh Generation, a leader in sustaibable cleaning, paper, and personal care products have signed on and is using eco.bottles, and they have seen sales increase 19% with it. 

In a Bloomberg BusinessWeek (25 October 2012) article, the chief operating officer of The Winning Combination states: "The minute you look at it, you get it. This is a bottle that's good for the planet."

Like these eco.bottles, we need more of our decisions to be driven by what is good for us long-term, so this is not just a revolutionary green bottle, but perhaps a true sustainable evolution in our thinking and behaving all around. 

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July 14, 2012

Leadership Now!

There is a very good interview in the Wall Street Journal today (14-15 July 2012) with George Shultz, former Secretary of State, Treasury, and Labor. 

Shultz talks primarily about our countries devastating financial situation today.

On the economy, he states bluntly: "We have some big problems in this country."

But according to the interview "the policies for revival are obvious with the right leadership."

Shultz gives an example of former President Reagan (who I blogged about previously (24 June 2012) in It's The Right Thing To Do] as someone who had what it took to lead us out of difficult times. 

"It took long-term thinking...[Reagan] knew and we advised him you can't have a decent economy with the kind of inflation we've got...The political people would come in and say 'You've fot to be careful Mr. President...You're gonna lose seats in the mid-term election."

And as Shultz reminds us, what was Reagan's response?

"And he basically said, 'If not us who? If not now when?"

The article goes on that "it took a politician with an ability to take a short-term hit in order to get the long-term results that we needed."

Reagans words and deeds remind me of the Jewish teaching from the Book of Avot ("Ethics of Our Fathers") from more than 2,000 years ago which reads in 1:14--

"If I am not for myself, who will be for me?
And if I am [only] for myself, what am I?
And if not now, when?"


Reagan was in tune with this ancient wisdom of our forefathers, that we have an obligation to take the appropriate actions to care for ourselves and others and not to put off these actions unto others or for later. 

This is one of those true leadership qualities that made Reagan one of the most popular and favorite leaders on the 20th century. 

Reagan acted based on principle and not based on votes--the long-term health and outcomes for the country was more important than the minute-by-minute polling. 

Of course a leader needs to represent the will and wishes of the people, but he must do so with the bigger-picture and long-term view in mind for the nation to survive and thrive. 

Similarly Peggy Noonan writes today about how we need a "political genius" to get us out of the mess we are in as a nation. 

She too uses Reagan as an example and explains how he used to state about congress that: "when they feel the heat [from voters], they see the light," and it is the President's job to help the people understand and "galvanize them."

As Ms. Noonan states about a real leader: "he's direct and doesn't hide his meaning in obfuscation, abstraction, cliches and dead words."

A leader who knows and believes as in the wisdom of fathers, and like Ronald Reagan, "If not us who? If not now when?"

(Source photo: here with attribution to Tom Magliery)

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June 15, 2012

Nokia and Microsoft, Desperate Bedfellows

A couple of hours ago, Nokia's debt was downgraded by Moody's to Junk!

Nokia was once the world largest vendor for mobile phones with almost 130,000 employees, but since the iPhone and Android, they have since fallen on hard times--who would've thought?

Just 16 months ago, in February 2011, Nokia announced a strategic partnership with Microsoft to try and stem their losses by adopting Windows Mobile, but this was like a drowning victim grabbing on to whoever is nearby to try and save themselves but only ends up in a double drowning.

No, Microsoft is not drowning exactly, but their stock has been more or less flat from a decade ago and one of the worst large-tech stock performers for the last ten years!

Will the acquisition of Yammer for $1.2 billion this week change this trend--I doubt it. 

Between Yammer for social networking and the acquisition of Skype for video-calling last year (May 2011) for yet another $8.5 billion, Microsoft is trying to fill some of it's big holes in its technology portfolio, just like Nokia was trying to fill it's gaping hole in mobile operating systems by partnering with Microsoft.

Unfortunately both Microsoft and Nokia have essentially missed the boat on the mobile revolution and the sentiment is flat to negative on their long-term prospects.

So the shidduch (match) of Nokia and Microsoft seems like just another case of misery loves company.

Desperation makes for lonely bedfellows, and thus the announcement this week by Nokia that they are going to layoff 10,000 and close 3 plants by end of 2013 was really no surprise. 

Aside from the short-term stock pop from the news of the acquisition, what do you think is going to be in the cards for Microsoft if they don't get their own innovative juices back in flow? 

Can you just acquire innovation or at some point do you need to be that innovative company yourself once again?

Rhetorical question. 

Hopefully for Microsoft they can get their mojo back on--meaning rediscover their own innovative talents from within and not just try to acquire from without.

(Source Photo: here with attribution to Kidmissile)

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April 28, 2012

Governing the Internet Commons

Recently, I've been watching a terrific series called America: The Story of Us (12 episodes)--from the History Channel. 

It is a beautiful portrayal of the the founding and history of America.

One theme though that repeats again and again is that as a nation, we use the common resources and deplete them until near exhaustion. 

The show portrays an America of lush forests with billions of trees that are chopped down for timber, herds of 30 million buffalo slaughtered for their hides, rollings plains of cotton for a thriving clothing industry that is over-planted, a huge whaling industry used for oil that is over-fished.  

Unfortunately, as we know, the story is not just historical, but goes on to modern-day times, with fisheries depleted, whole species of animals hunted to extinction, energy resources furiously pumped and mined to a foreseen depletion, city streets turned into slushy slums, and national forests carelessly burned down, and more. 

The point is what is called the "Tragedy of the Commons"--where items held in trust for everyone is misused, overused, and ultimately destroyed. With private property, people are caretakers with the incentive to maintain or raise the value to profit later. However, with common property, people grab whatever they can now, in order to profit from it before someone else gets it first. 

This phenomenon was first laid out in the Torah (Bible) with a law for a "Shabbath Year" called Shmita mandating that people let fields (i.e agriculture) lie fallow for a full year every 7 years and similarly, the law of Jubilee (i.e. Yovel), that slaves be freed and loans forgiven every 50 years. I think that the idea is to regulate our personal consumption habits and return what the historical 
"commons" back to its normal state of freedom from exploitation.  

This notion was echoed by ecologist Garrett Harden in the journal Science in 1968, where he described European herders overgrazing common land with their cows to maximize their short-term individual profits at the expense of longer-term term societal benefits. Harden suggested that regulation or privatization can help to solve the "Tragedy of the Commons." 

In the 21st century, we see the modern equivalent of the commons with the Internet, which is an open, shared networking resource for our computing and telecommunications.Without protection, we have the Wild West equivalent with things like spam, malware, and attacks proliferating--clogging up the network and causing disruptions and destruction, and where some people use more than their fair share 

Here are some examples of the Tragedy of the Internet:

- Symantec reports that even with spam decreasing with the shutdown of spam-hosting sites, in 2011, it is still 70% of all emails.

- McAfee reports that malware peaked as of the first half of 2010, with 10 million new pieces.

- Kaspersky reports that web-based attacks were up to 580 million in 2010--8 times the amount of the previous year.

- Verizon Wireless reports 3% of their users use 40% of their bandwidth.

If we value the Internet and want to continue using and enjoying it, then like with our other vital resources, we need to take care of it through effective governance and prudent resource management.  

This means that we do the following:

1) Regulation--manage the appropriate use of the Internet through incentives and disincentives for people to behave civilly online. For example, if someone is abusing the system sending out millions or billions of spam messages, charge them for it!

2) Privatization--create ownership over the Internet. For example, do an Internet IPO and sell shares in it--so everyone can proverbially, own a piece of it and share financially in it's success (or failures). 

3) Security Administration--enhance security of the Internet through public and private partnership with new tools, methods, and advanced skills sets. This is the equivalent of sending out the constable or sheriff to patrol the commons and ensure people are doing the right thing, and if not then depending on who the violating actor(s) are take appropriate law enforcement or military action.

Only by managing the Internet Commons, can we protect this vital resource for all to use, enjoy, and even profit by. 

(Source Photo: here)

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March 5, 2012

Are You A Moses or A Seagull?

I have a new article called "Leadership for Lasting Change."

"Usually organizational turnaround don't happen by themselves. They are steered by change agents, people unafraid to take the reins and move forward. Like Moses liberating the Jewish people from slavery, a strong leader shows his [/her] people the way."

Read the article at Public CIO Magazine, Winter 2012. 

Hope you enjoy it.

Andy 

(Source Photo: here)

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October 10, 2011

Growing America's Jobs

Robot

ABC News reported tonight of a home builder in Montana making a house entirely from American made products--as difficult as they are to find.

The home uses more than 120 products from 33 states and costs only 1 to 2% more than a foreign-sourced one.

The builder who is also an economist says that if builders around the country would just increase their use of made in the USA products by 5%, we could increase jobs by over 220,000 right now.

Multiple it by ten, if we actually produced these homes 50% or more here in the USA--that's 2+ million jobs.

It makes you wonder if all the outsourcing is just another addiction where we feel good now--by saving a little today at the checkout line--but we pay the piper down the road, through the gutting of our own labor force and the future capacity for us to produce.

While, I don't believe in circle-the-wagon protectionism out of fear of competing in the global marketplace, I do think we need to assess the deals we make to ensure that we are getting the best for our people and our future--and not just for the next quarter or two, but for the long-term!

Having started my career in business, I am well aware that this is "one big balance sheet" and things have to add up or else short-term profits today are made at the expense of long-term capabilities tomorrow.

If the strategy was that we would somehow give the blue collar work to others and keep the white collar work for ourselves, it seems like we have deluded ourselves into thinking that a one-size fits all economy will keep America running.

We need broad based opportunities for our diverse workforce in all areas of work, and we need to remain strategically self-sufficient, so that we do not outsource ourselves to economic death, where we lose the know-how or capability to help ourselves.

Buy, build, and work America into an economic powerhouse that the world relies on, rather than one that is fed by others with economic loans and cheap goods made in wherever-land.

In my opinion, there is no real alternative to balancing the national budget as well our current account deficit--if we consistently spend more than we earn, and the ships keep unloading more stuff here and then going back overseas half empty, eventually the system has got to go kaput!

As the world's superpower, our coffers can once again be full and our ships can brim proud with made in America wares--but this can happen only if we focus on products that outlast, outlook, and outperform.

Competition has never been more fierce and the stakes never higher for us individually and as a nation--we will need technology to keep us steadily improving and releasing the pressure from this enormous economic cooker.

(Source Photo: here)

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September 25, 2011

They're Not Playing Ketchup

I wouldn't necessarily think of Heinz as a poster child for a company that is strategic and growing, and was therefore, somewhat surprised to read an impressive article in Harvard Business Review (October 2011) called "The CEO of Heinz on Powering Growth in Emerging Markets."

Heinz, headquartered out of Pittsburgh PA, is ranked 232 in the Fortune 500 with $10.7B in sales, $864M in profits, and 35,000 employees. They have increased their revenue from emerging markets from 5% a few years ago to more than 20% today.

Bill Johnson, the CEO of Heinz, explains his 4 As for success--which I really like:


1) Applicability--Your products need to suit local culture. For example, while Ketchup sells in China, soy sauce is the primary condiment there, so in 2010, Heinz acquired Foodstar in China, a leading brand in soy sauce.

2) Availability--You need to sell in channels that are relevant to the local populace. For example, while in the U.S., we food shop predominantly in grocery stores, in other places like Indonesia, China, India, and Russia, much food shopping is done in open-air markets or corner groceries.

3) Affordability--You have to price yourself in the market. For example, in Indonesia, Heinz sells more affordable small packets of soy sauce for 3 cents a piece rather than large bottles, which would be mostly unaffordable and where people don't necessarily have refrigerators to hold them.

4) Affinity--You want local customers and employees to feel close with your brand. For example, Heinz relies mainly on local managers and mores for doing business, rather than trying to impose a western way on them.

Heinz has a solid strategy for doing business overseas, which includes "buy and build"--so that they acquire "solid brands with good local management that will get us into the right channels...then we can start selling other brands."

Heinz manages by being risk aware and not risk averse, diversifying across multiple markets, focusing on the long-term, and working hard to build relationships with the local officials and managers where they want to build businesses.

"Heinz is a 142-year old company that's had only five chairmen"--that's less than the number of CEO's that H-P has had in the last 6 years alone.

I can't help but wonder on the impact of Heinz's stability and laser-focus to their being able to develop a solid strategy, something that a mega-technology company like H-P has been struggling with for some time now.

If H-P were to adopt a type of Heinz strategy, then perhaps, they would come off a little more strategic and less flighty in their decisions to acquire and spin off business after business (i.e. PCs, TouchPads, WebOS, etc.), and change leadership as often as they do with seemingly little due diligence.

What is fascinating about H-P today is how far they have strayed front their roots of their founders Bill and Dave who had built an incredibly strong organizational culture that bred success for many years.

So at least in this case, is it consumer products or technology playing catch-up (Ketchup) now?

P.S. I sure hope H-P can get their tomatoes together. ;-)

(Source Photos: Heinz here and H-P here)

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May 13, 2011

Reading is Love


What an inspiring story this week about Jim Brozina and his daughter Alice Ozma.

Jim's wife left him when Alice was ten years old.

And when Alice started 4th grade, Jim (a retired librarian) made a challenge to his daughter to see how many nights they could read together in row--it was a way for them to spend time together and bond.

Well their "Streak" went on and on--for over 3000 nights--almost 9 years--until Alice's first night at Rutger's University.

Alice majored--of course--in English Literature.

And she wrote a book called "The Reading Promise" about her dad's selfless devotion and love to her, reading every night.

I remember as a kid, the commercials encouraging reading--"Reading is Fundamental".

Now I know that reading is not just fundamental (to learning and growth), but is also a way to love someone.

In the hustle and bustle of the 21st century, how many of us spend the time with our kids--consistently and with the utter devotion that this father did--one chapter a night, every night?

Aside from the lesson of selflessness in this story, I also see in this the message of incremental change and growth--by starting off with just 15 minutes a day and building on this incrementally, Jim and Alice were able to accomplish so much together over the years--in terms of learning and their relationship.

So while, the big blowout moments in life are significant memories for us and very often get a lot of emphasis (i.e. as in "let's make a memory"), the day-to-day consistent building of relationships and learning, can have a truly larger than life impact over the long-term.

On a more personal note, I remember when I was debating going back to school for my MBA (while working full-time during the day), and my dad encouraged me and told me that the years would come and go regardless, but that if I made the commitment, at the end, I would have something valuable to show for it.

I listened to his advice and went to school at night for what seemed like ages for an MBA and then numerous certifications and other learning opportunities, and I am always glad that I did. Dad was right...the years pass regardless, but your hard work pays off. I will always be grateful to him for that advice and support--love comes in many shapes and sizes.

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January 16, 2010

Customer-driven IT Management

For many years, we have witnessed the failures of excessively product-driven management, where companies focus on the development and sales of products (from automobiles to toaster ovens) to their customers—whether the customers really want those products or not. This was epitomized by the “build it and they will come” mentality.

Numerous companies faltered in this over-the-top product mindset, because they were focused not on satisfying their customer’s needs, but on selling their wares. Think GM versus Toyota or the Days Inn versus The Four Seasons.

Now however, organizations are moving from product- to customer-focused management, with the basic premise that organizations need to engage with their customers and assist them in getting the most value out of whatever products meet their requirements best. In the world of IT, this is the essence of user-centric enterprise architecture, which I created and have been advocating for a number of years.

Harvard Business Review, in January-February 2010, has an article titled “Rethinking Marketing” that asserts that “to compete, companies must shift from pushing individual products to building long-term customer relationships.”

· Product-driven companies—“depend on product managers and one-way mass marketing to push a product to many customers.”

· Customer-driven companies—“engage individual customers…in two-way communications, building long-term relationships.”

The old way of doing business was to focus on the products that the company had to offer and “move inventory” as quickly and profitably as possible. I remember hearing the sales managers yelling: “sell-sell-sell”—even if it’s the proverbial Brooklyn Bridge. And the driver of course, was to earn profits to meet quarterly targets and thereby get bigger bonuses and stock options. We saw where that got us with this last recession.

The new way of doing business is to focus on the customer and their needs, and not any particular product. The customer-driven business aligns itself and it’s products with the needs of its customers and builds a long-term profitable relationship.

“In a sense, the role of customer manager is the ultimate expression of marketing find out what the customer wants and fulfill the need), while the product manager is more aligned with the traditional selling mind-set (have product, find customer).”

The new model for a customer-driven enterprise is the epitome of what social computing and Web 2.0 is really all about. In the move from Web 1.0 to 2.0, we transformed from pushing information to stakeholders to having a lively dialogue with them using various social media tools (like Facebook, Twitter, blogs, discussion boards, and many more)—where customers and others can say what they really think and feel. Similarly, we are now moving from pushing products to actively engaging with our customers so as to genuinely understand and address their needs with whatever solutions are best for them.

In a customer-focused organization, “the traditional marketing department must be reconfigured as a customer department [headed by a chief customer officer] that puts building customer relationships ahead of pushing specific products.”

I think that the new organizational architecture of customer-driven management is superior to a product-focused one, just as a emphasis on people is more potent that a focus on things.

Similar to customer-driven management, in User-centric enterprise architecture, we transform from developing useless “artifacts” to push out from the ivory tower to instead create valuable information products based on the IT governance needs of our customers.

Further, by implementing a customer-focus in information technology management, we can create similar benefits where we are not just pushing the technology of the day at people, but are rather working side-by-side with them to develop the best solutions for the business that there is.


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May 31, 2009

From Pigging Out to Piggybanking

Recently there was some media interest in the government system of funding allocation, which essentially rests on one principle: “Use it or lose it.” Unlike in the private sector, where unused funds may be reserved for future use, money that is not spent in a given appropriation year is simply returned, for the most part.

In our own personal financial worlds, in fact, it is a primary lesson that we should not spend every dollar we earn. Rather, any financial adviser will tell you that money must be managed over many years, including saving money for the proverbial “rainy day” (the recent financial meltdown and recovery act not withstanding).

In business as well as in our personal lives, we are taught to do three things with our money:

·      Spend some—for business operating expenses or living expenses in our personal lives.

·      Save some—for unexpected needs like when a economic recession negatively impacts business cash flow or in our personal lives when a job is lost and we need savings to tide us over; or the saving could be for opportunities like to accumulate funds to get into a new business or to save up for a deposit on a home.

·      Invest some—for longer-term needs like research and development, potential business acquisitions, and so forth or in our personal lives for college education, weddings, retirement and more.

My question is why in government is there not an option #2 or #3—to save or invest funds for the future, like we have in our personal lives and in business?  Why can’t agencies and lawmakers plan longer-term and manage funds strategically instead of tactically—beyond the current year here and now?

The Clinger-Cohen Act of 1996 called for the development and maintenance of an IT architecture, since interpreted more broadly as the mandate for enterprise architecture, where we plan and govern investments strategically (i.e. no longer based on short-term gut, intuition, politics, or subjective management whim).

Managing for enterprise architecture necessitates that we manage business and IT investments with the ability to spend, save, or invest as necessitated by agency mission and vision, customer requirements, and the overall investment climate (i.e. the return on spending versus the return on saving or longer-term investment).

Managing money by driving an end of year spend-down seems to negate the basic principles of finance and investing that we are taught from grade school and that we use in business and our personal lives.

By changing the government budget process to allow for spending, saving, and investing, we will open up more choices to our leaders and hold them responsible and accountable for the strategic long-term success of our vital mission.


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April 9, 2009

You Can Lead a Horse to Water

When we architect change, we have to build in the transition plan for how to get from point A to point B. The problem with most enterprise architectures though is that they begin and end with the equivalent of “Thou Shalt” and never does the architecture deal with the behavioral elements of how to actually motivate people and organizations to change the way we plan/want them to.

Maybe that’s one reason why architectures so often remain shelfware and never actually get implemented.

This is reminiscent of the adage, “you can lead a horse to water, but you can’t make him drink” or can you?

With the Obama administration elected on a platform of change and major problems facing our nation in terms of the economy, healthcare, the environment, and so on, we are seeing the government confront the dilemma of how do we get the change we promised?

Time Magazine, 2 April 2009 has an interesting article “How Obama is using the Science of Change.”

The administration is using it [behavioral science] to try to transform the country. Because when you know what makes people tick, it’s a lot easier to help them change.”

Similarly, this knowledge can help enterprise architects effect change in their organizations. It’s not enough to just put a plan to paper—that’s a long way from effecting meaningful and lasting change.

So here are some tips that I adapted from the article:

  • Bottom-up or Top Down: We can mandate change from the top or we can grow change from grass-roots. If we can do both, the change is swifter and more likely to succeed.
  • Carrot and Stick: Change is not easy and usually will not happen without a nudge—we need help. We need to motivate desired change and disincentive obstinate clinging to failed status quo behaviors that are hurting the mission and long term success of the organization.
  • Make change clear and simple: Explain to people why a change is important and necessary. “In general, we’re ignorant, shortsighted, and biased toward the status quo…we procrastinate. Our impulsive ids overwhelm our logical superegos.” So change has got to be clearly articulated, easy to understand, and simple for people to act on. “Cheap is alluring; easy can be irresistible.”
  • Accept that change is painful: We need to keep our eye on the goal, and then accept that we have to work hard to achieve it. President Obama “urges us to snap out of denial, to accept that we’re in for some prolonged discomfort but not to wallow in it, to focus on our values.”
  • The way of the herd: When implementing change initiatives, we need to build community “creating a sense that we’re all in this together.” “We’re a herdlike species….when we think we’re out of step with our peers, the part of our brain that registers pain shifts into overdrive.”
  • Keep the focus on long-term success: Weight the benefits of long-term planning and change to short term status quo and gratification; constantly remind people that most worthwhile organizational goals are a marathon and not a sprint. But together, we can support each other and achieve anything.

With behavioral science principles like these, we can make enterprise architecture transition plans truly actionable by the organization.


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December 31, 2008

IT Planning, Governance and The Total CIO

See new article in Architecture and Governance Magazine on: IT Planning, Governance and the CIO: Why a Structured Approach Is Critical to Long-Term Success

(http://www.architectureandgovernance.com/content/it-planning-governance-and-cio-why-structured-approach-critical-long-term-success)

Here's an exrcept:

"IT planning and governance undoubtedly runs counter to the intuitive response—to fight fire with a hose on the spot. Yet dealing with crises as they occur and avoiding larger structures and processes for managing IT issues is ultimately ineffective. The only way to really put out a fire is to find out where the fire is coming from and douse it from there, and further to establish a fire department to rapidly respond to future outbreaks."


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October 31, 2008

Weapons or Troops and The Total CIO

Should the CIO focus on day-to-day operational issues or on IT strategic planning and governance issues?

From my experience many are focused on firefighting the day-to-day and putting some new gadget in the hands of the field personnel without regard to what the bigger picture IT plan is or should be.

In many cases, I believe CIOs succumb to this near-term view on things, because they, like the overall corporate marketplace, is driven by short-term results, whether it is quarterly financial results or the annual performance appraisal.

The Wall Street Journal, 30 October 2008, had an article entitled,
“Boots on the Ground or Weapons in the Sky?”—which seemed to tie right into this issue.

The debate is to which kind of war we should be preparing to fight— the current (types of) insurgencies in Iraq and Afghanistan or the next big war, such as potentially that with Russia or China.

Why are we facing this issue now?

“With the economy slowing and the tab for the government’s bailout of the private sector spiraling higher…lawmakers are signaling that Pentagon officials will soon have to choose.”

And there are serious implications to this choice:

“The wrong decision now could imperil U.S. national security down the road.”

The two sides of the debate come down to this:

Secretary Gates “accused some military officials of “next-war-itis,” which shortchanges current needs in favor of advanced weapons that might never be needed.”

In turn, some military officials “chided Mr. Gates for “this-war-itis,” a short-sighted focus on the present that could leave the armed forces dangerously unprepared down the road.”

From war to technology:

Like the military, the CIO faces a similar dilemma. Should the CIO invest and focus on current operational needs, the firefight that is needed today (this-IT-itis) or should they turn their attention to planning and governing to meet the business-IT needs of the future (next-IT-itis).

But can’t the CIO do both?

Yes and no. Just like the defense budget is limited, so too is the time and resources of the CIO. Sure, we can do some of both, but unless we make a conscious decision about where to focus, something bad can happen.

My belief is operations must be stabilized--sound, reliable, and secure—today’s needs, but then the CIO must extricate himself from the day-to-day firefighting to build mission capabilities and meet the needs of the organization for tomorrow.

At some point (and the sooner, the better), this-IT-itis must yield to next-IT-itis!


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September 26, 2008

Treating the Root Cause and Enterprise Architecture

All too often, when there are issues in our organizations, we treat the symptoms instead of the problems. Just like this is bad medicine in treating illness and healing patients, so too it is ineffective in architecting our organizations.

The Wall Street Journal, 22 September 2008, has an article entitled “Making the Most of Customer Complaints.”

The quick-fix problem resolution:

"Companies have customer service sort out the immediate problem, offer an apology or some compensation, then assume all is well. This approach does nothing to address the underlying problem, practically guaranteeing similar failures and complaints.”

This “has enormous impact on customer satisfaction, repeat business, and ultimately profits and growth.”

The three actors and their conflicting approaches:

The customer—“can be left feeling their problem was not addressed seriously, even when they’ve received some form of compensation.” Customers are fairness-minded; they want to know why the problem occurred and that it will not happen again.

The service rep—“can start seeing complaining customers as the enemy, even though they point out flaws that need fixing.” Customer service reps are yelled at and abused by frustrated and angry customers who hold the service reps responsible for failures that are out of their control.

The managers—“can feel pressure to limit flows of critical customer comments, even though acting on the information will improve efficiency and profits.” Managers need to learn from failures and reengineer the processes to correct problems, but instead they fear reporting negative customer satisfaction and shun reporting these. In essence, they are taught to just make the problem go away!

The result:

“Fewer than 8% of the 60 organizations” in the wall Street Journal study did well integrating these actors and their perspectives to resolve problems at their root cause.

The focus unfortunately is on short term results instead of architecting long term success.

“Our experience with managers interested in improving service recovery indicates that most hope for a quick fix…but quick fixes only treat the symptoms of underlying problems. Real resolutions should involve closer integration among the three stakeholders, such as gathering more information from customers and sharing it throughout the company, and adopting new structures and practices that make it easier to spot problems and fix them.

There is an important enterprise architecture lesson here:

While executive management often want to achieve a quick turnaround and show results ASAP, and getting the low hanging fruit is often quite tempting, it is not often going to lead to substantive improvement in our organizations without a commitment and plan to address root cause.

Sure, in architecting the organization, we need to start somewhere, show progress, and continuously build on initial success (i.e. it’s an evolutionary process). However, there must be a long term plan/architecture that deals with genuine, deep-seated organizational issues, improves our underlying processes and their technology enablement, and leads to fundamental growth and enterprise maturation. A quick fix just will not do!


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June 13, 2008

What Goes Around Comes Around and Enterprise Architecture

As an enterprise architect, I have always wondered about the trend of outsourcing our manufacturing jobs out of country-- where as a nation we erode our manufacturing base and ship this capability to China, India, Mexico, and other countries where labor is plentiful and cheap.

Yes, in the short term we are taking advantage of the lower costs of manufacturing in other countries, but long term, I always questioned the viability of this strategy thinking that surely every nation needs to maintain a core of critical manufacturing and service capabilities and infrastructure to guarantee self-sufficiency, protect itself from eventual global disruptions, and ensure the continuity of its existence.

I believe that some day (and maybe relatively soon), we will regret the near-sightedness of our decisions to move production abroad for the sake of the dollar today.

Interestingly enough, I read in the Wall Street Journal today, 13 June 2008, that “stung by soaring transport coasts, factories bring jobs home again.”

“The rising costs of shipping everything from industrial-pump parts to lawn mower batteries to living-room sofas is forcing some manufacturers to bring production back to North America and freeze plans to send even more work oversees.”

I thought to myself—Hallelujah!

No, I am not happy that oil prices are soaring and that inflation is looming everywhere, but I am cautiously relieved that perhaps, we as a nation will wake up in time to secure our economic interests at home and not send our entire manufacturing base and capabilities out of country.

Ironically (da!), the further we move our factories away, the more it costs now to ship the goods back home.

“The movement of factories to low-cost countries further and further away has been a bitter-sweet three-decade long story for the U.S. economy, knocking workers out of good-paying manufacturing jobs even as it drove down the price of goods for consumers. But after exploding over the past 10 years that march has been slowing. The cost of shipping a standard 40-foot container from Asia to the East Coast has already tripled since 2000 and will double again as oil prices head toward $200 a barrel…In the world of triple-digit oil prices, distance costs money.”

The other thought that always kept coming to mind was that as we continue to move manufacturing abroad, the increasing demand for labor would drive the cost of labor up, and eat away at the cost differential making the overseas move a moot point.

Again, I read today in the Journal the story I always felt was bound to be told and to continue to unfold: “The cost of doing business in China in particular has grown steadily as workers there demand higher wages and the government enforces tougher environmental and other controls. China’s currency has also appreciated against the dollar…increasing the cost of products in the U.S.”

One problem with trying to bring the jobs back home…

“Much of the basic infrastructure needed to support many industries—such as suppliers who specialize in producing parts or repairing machines—has dwindled or disappeared.”

What goes around, comes around. The jobs (some) are coming home (although net-net, we’re still losing manufacturing jobs). As a country, we‘ve benefited in the short-term from outsourcing, but in the long-term, I believe we’ll have done ourselves a good deal of harm.

Does this sound unfamiliar?

Think national deficit—big time. Think gargantuan problems with social security, Medicare, health care, and so on.

All too often, we behave with short-sightedness and like infants, the desire for immediate gratification. But as enterprise architects, I believe we need to think long term and often defer gratification for long-term competitiveness, self-sufficiency, and survival.


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January 12, 2008

The Marines and Enterprise Architecture

Traditionally, the Marines are known for their rapid, hit hard capabilities. They are a highly mobile force trained to transport quickly on naval vessels and literally “take the beachhead.” However, with the war in Iraq, the Marines have assumed a more non-offensive deployment posture in “conducting patrols.”.

The Wall Street Journal, 12-13 January 2008, provides an interview with the Commandant of the Marines, General James T. Conway about the need for “the Corps to preserve its agility and its speed.”

“It’s the future of the Corps not its past that dominates Gen. Conway’s thoughts…that in order to fight this war, his Corps could be transformed into just another ‘land army’; and if that should happen, that it would lost the flexibility and expeditionary culture that has made it a powerful military force. The corps was built originally to live aboard ships and wade ashore to confront emerging threats far from home. It has long prided itself in being ‘first to the fight’ relying on speed, agility, and tenacity to win battles. It’s a small, offensive outfit that has its own attack aircraft.” However, in Iraq, the Marines are performing in a “static environment where there is no forward movement” Additionally, there is a feared culture change taking place, the marines “losing their connection to the sea while fighting in the desert” over an extended period of time.

When we think about enterprise architecture, most people in IT think about technology planning and transformation. However, EA is about both the business and technology sides of the enterprise. Change, process reengineering, and retooling can take place in either or both domains (business and technology). In terms of the Marines, we have altered their business side of the enterprise architecture roadmap. We have radically changed their business/mission functions and activities. They have gone from service and alignment to the long term mission needs of this nation for a rapid, mobile, offensive fighting force to accommodate the short term needs for additional troops to stabilize and conduct counter-insurgency and peace-keeping operations in Iraq. Whether the business functional change ends up hurting the culture and offensive capabilities of the Marines remains to be seen. However, it does raise the interesting question of how organizations should react and change their functions and processes in reaction to short term needs versus keeping to their long term roadmap and core competencies.

Of course, when it comes to the Marines, they must adapt and serve whatever the mission need and they have done so with distinction.

In regards to the long term affects, General Conway states: “Now, it is necessitated that we undergo these changes to the way we are constituted. But that’s OK. We made those adjustments. We’ll adjust back when the threat is different. But that’s adaptability…You create a force that you have to have at the time. But you don’t accept that as the new norm.”

As we know, in EA and other planning and transformation efforts, change for an organization—even the Marines—is not easy and resistances abound all around. How easy will it be for the Marines to return to their long term mission capabilities? And how should EA deal with short term business needs when they conflict with long term strategy for success?


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