Retiring old equipment

rusty old car

IDC has a report out showing the increase in IT costs for managing older hardware and software, covered by a recent Computerworld article. It’s sponsored by Microsoft so yes the numbers are unsurprising. But they are also quite believable.

  • The magic milestone is after the three-year mark, when “costs begin to accelerate” because of additional IT and help desk time, and increased user downtime due to more security woes and time spent rebooting
  • IT labor costs jump 25% during year four of a PC’s lifespan, and another 29% in year five,, while user productivity costs climb 23% in year four and jump 40% during year five. Total year five costs are a whopping 73% higher than support costs of a two-year-old client
  • Organizations reported that they spent 82% less time managing patches on Windows 7 systems than they did on Windows XP, 90% less time mitigating malware, and 84% less help desk time
  • Windows 7 users wasted 94% less time rebooting their computers and lost 90% less time due to malware attacks.

It’s part of Microsoft’s campaign to get computers running Windows XP replaced.  And so they should be. You rarely see a company car over the age of 3 years old, let alone in service for over a decade.  This is another area that in time will benefit from the transition to cloud computing and apps that work across multiple devices. One of the issues for replacing old desktops in large companies has been a dependency on bespoke applications that prove hard to migrate. That’s one trend to be glad to see the back of.

An associate who runs an IT support company for small businesses has recently introduced a new service plan for his clients.  The support costs now increase for all equipment over 5 years old.  For many customers, it has spurred them into action. IT systems can become like a pair of comfy old slippers – we hang on to them for far too long after they outlive their usefulness. The comparison to managing cars and their servicing/MOT costs has encouraged many to now look at a more regular cycle to keep technology current and useful to business activities instead of just sticking with what they are used to regardless of the wear and tear. Not all good news for Microsoft, some are now looking at a possible switch to Apple and others…

Video interview about Olympic IT

BCS interview image

The British Computer Society/Chartered Institute for IT has posted an interview with the Metropolitan Police’s Director of IT, Stephen Whatson, who’s been tasked with the IT infrastructure for the Olympics this year.  Includes some interesting comments about the preparation and decisions made. Video embedded below (Flash player required).

 

Source: BCS – Video interview: Olympic IT, Apr 2012

The need to mix business and design

A great article on Fast Company highlights the need for both business and design skills when faced with tough business challenges: What Both MBAs And MFAs Get Wrong About Solving Business Problems, by Melissa Quinn.

Article outline: Numbers and bullet points aren’t the only things driving executive decision making. And pretty pictures won’t get you there either. Both designers and MBAs have a lot to learn.

Toronto University’s Rotman School of Management has run a design challenge geared at exposing MBA students to the value of design methods in business problem solving. For the past 2 years, the MBAs (Masters of Business Administration) have been trounced by the MFAs (Masters of Fine Arts). How?

With only 15 minutes to convince a skeptical panel of experienced professionals about a new idea that doesn’t exist in the world today, [MFAs] fared significantly better than their MBA counterparts. Why? Because they shared real user insights to engage us emotionally, used narrative and stories to compel us, drew sketches and visualizations to inspire us, and simplified the complex to focus us. It’s proof positive that numbers and bullet points, while important, aren’t necessarily what drive executive decision making

The key message – don’t assume you can teach MBAs to do this stuff well by chucking in a couple of modules as part of their course. Don’t dismiss the years of study that designers undertake to develop these skills.

That said, it wasn’t an entirely happy ending for the MFAs either.

While design students fared much better than their MBA counterparts that Saturday afternoon, I should point out that only the winning team from the Institute of Design at IIT actually charged a fee for the service they developed (a fact that was not overlooked by my final-round co-judge Ray Chun, the senior vice president of retail banking at TD). Some competitors were able to offer a vague notion that their ideas would generally create economic value, but crisp articulations of a profit model and underlying assumptions were hard to come by.

A great article, worth a read. Particularly if you tend to rely on bullet points more than visuals in PowerPoint to explain something you want people to remember. (Side note: but does depend on the type and purpose of presentation. If teaching a technical topic, screenshots and bullet points are usually quite helpful after the event.)

p.s. The image at the top? A book shelf in my home office, containing some of the books that continue to help develop presentations. Story boarding for films has been the latest new topic of study. 🙂 (Half of those books are in Kindle-only format… times change.)

As a good mentor Nicholas Bate likes to say – ‘Always be learning’.

Evolving web business models

There is an outstanding presentation on Slideshare explaining why all web-based businesses need to be evolving their business models to leverage APIs more than their own web sites. Found via Twitter but I can’t find who originally shared as Tweetville is amok with a ‘0 followers’ discussion at the moment. And this presentation is too good to get lost in the stream.

To summarise the presentation:

  • Darwin identified that finches lived in a very remote location meaning the variations had to compete with each other to survive. The finches you see today are the winners
  • At the start of the 20th Century, retail business was primarily local within villages, towns and cities, selling direct to people. With the evolution of suburbia, we saw the shift from the corner shop to the shopping mall with each mall containing mostly the same retail brands – business went from direct to indirect. The big brands at the end of the 20th Century were the winners
  • At the start of the 21st Century, web-based business was ‘local’ to the web site, selling direct to visitors. With the evolution of social networks and mobile devices, we are seeing a shift from visiting the corner-shop equivalent web site to the mall equivalent – lots of businesses hosted on the same web platform, be it micro-applications on your mobile phone or applications in widgets on a social networking site. To be one of those applications means using APIs (application programming interfaces). How important is it?:

80% of web-based traffic will be coming from beyond the browser…

If you are doing business online, you need developers who understand APIs

March News and Links

Here’s a selection of links shared during February via Google Reader, Delicious and Twitter. Organised into the usual overlapping categories: Systems and the bits and pieces that make them work.Hot topic this month- games and reputation starting to be examined seriously as social media rumbles on into the workplace. Enjoy!

Systems

People

Information

Technology

…and finally, finishing with the usual bit of fun. Well two bits this month as couldn’t decide between them:

1. Dilbert highlights a painful reality for too many projects

Dilbert.com

2. Why companies needn’t worry too much about how people blog – stuff usually catches up with you and lessons are often best remembered when learned the hard way…

Institutions will always resist change

This is a follow on to the previous post: The Inevitable Collapse of Systems. Clay Shirky recently quoted (posted by Kevin Kelly but without a link, naughty Kevin!):

Institutions will try to preserve the problem to which they are the solution.

This is along the same lines as the great quote by Nicholas Machiavelli back in the 16th Century:

There is nothing more perilous to conduct, more uncertain in its success, than to take the lead in introducing a new order of things, because the innovator will have for enemies all who have done well under the old conditions, and only lukewarm defenders in those who may do well under the new.

The trouble with challenging institutions is the power they wield to help protect and maintain their position, and the fear, uncertainty and doubt (FUD) they will generate about anything new that threatens their comfortable existence. As being ably demonstrated by the music publishing industry. Those who profited from the old conditions would have everyone believe music creativity is dying because of new conditions created by the Internet (i.e. illegal downloads). Watching the recent music awards on TV (US and UK), there are no such signs. People were creating and performing music long before publishing industry came along and will continue to do so no matter what the financial rewards. It is not creativity that is dying, it is the ability to generate money that is being challenged. And here we are in the UK, facing a hastily written Digital Economy bill aimed at protecting an industry’s distorted revenue model.

It is not the fittest or the strongest of species that survive but the one most adaptable to change. – Darwin

When institutions are able to persuade governments to try and protect their status at any cost, they are using their strength to delay the need to adapt. And that presents a huge risk for everyone, because creating legislation or spending tax to prevent change shows all the signs of an economic system heading towards collapse.

It is not necessary to change. Survival is not mandatory. – W. Edwards Deming

Why do we need music albums? We don’t and we never did. They were invented by the music publishing industry because it is easier to make profits from selling albums than singles. That was possible under the old conditions. It isn’t so easy under the new. But with change brings opportunity. If you are selling albums, you only need to support a few performers and are only interested in the ones that generate easy album sales. Now that I buy mostly singles, I purchase from a far more diverse range of performers, often discovered from hearing or watching them online. Well done iTunes, Spotify and YouTube! No surprise that none were the invention of a music publishing company.

Illegal music downloads are wrong. But focusing on piracy and trying to claim it is damaging creativity when what it is really damaging is abnormal wealth that was only possible under the old conditions is FUD that diverts attention away from the industry’s resistance to change.

[Update: 08 Apr 10] Too funny to not include as an update. Just days after rushing through the Digital Economy Bill without proper debate, the two main political parties are both accused of copyright infringement for not asking permission before using images from a TV series as part of their election posters: Labour and Conservative parties accused of copyright infringement

References

Related blog posts

Amateurism can win battles

This Monday’s Start the Week programme on Radio 4 included an interesting discussion about amateurism during World War II, or as it was titled: ‘The dodgy dossier that fooled Hitler’. The short version (I’d encourage you to listen to the podcast, details at the end of the post):

In 1943, allied troops were in North Africa waiting for orders to attack in Europe. If you looked at a map it was pretty obvious where the attack would start – Sicily. To try and gain the upper hand, an elaborate hoax was put in place to try and convince Hitler that instead of Sicily, the attack was going to begin from Greece in the Eastern Mediterranean and Sardinia in the West. This involved procuring a dead person in London, covering up the fact he had died of poisoning to instead make it look like he died in an air crash, dropping him in the sea to float ashore at a specific location in Southern Spain where intercepted messages suggested a particular German secret agent was operating. The false documents planted on the body should hopefully be discovered by said agent, be identified as real battle plans and hopefully be passed up the chain of command to the very top.

The whole idea sounds like some ridiculous plot in a work of fiction. There are far too many variables and dependencies that could go wrong.  And worst of all, if the German secret agent was not fooled by the fake documents, it would beyond doubt confirm Sicily as the real location and likely double Hitler’s efforts there. In short, the plan had as much chance of making matters worse as making them better.

The plan worked.

Listen to the podcast to hear more about it, including “although World War II claimed more lives than any other conflict in history, finding the right dead body was incredibly difficult…” it’s a great conversation. But what’s interesting, and the reason for this post, was a comment made towards the end of the story:

“If Churchill hadn’t been such an enthusiast for this sort of operation and given them full rein…In a way it’s a celebration of amateurism, they were allowed to think what ever they wanted and try it out.”

An Admiral commented about the plan “You can rely on the enemy’s ‘yesmanship’ and ‘wishfulness’”

How many leaders today be prepared to take such a leap of faith? The preference is to rely on statistics and follow standard procedures over ideas and instincts. A simple example was reported this week. Somebody tweeted they were going to blow up their local airport. When discovered by the police, they were arrested under the Terror Act, have had their phone and laptop confiscated, received a lifetime ban from said airport, and been suspended from work until it is decided whether or not they will be prosecuted.  The missing piece of context from this story: just before the alleged bomb threat, the person had been tweeting their frustration with the snow and how it was ruining their holiday plans because the local airport was closed. It was a stupid joke in the current climate. But really, how long should it have taken for someone to decide if this was a serious terrorist threat or not versus following the standard ‘send in the cavalry’ procedure. Our officials are becoming yes-folk. And that puts us at more risk, not less…

The danger in relying on process and statistics at the expense of ideas and instincts is you risk missing the threat in front of your eyes. Perhaps we should bring a bit of amateurism, or humanism, back into official processes.

For the rest of this week (until January 25th) you can download a copy of the programme via iTunes or listen using BBC’s iPlayer

References:

Web 2.0 will thrive but not yet a while

When economies started to collapse in the second half of this year, many blog posts cropped up heralding the death of Web 2.0. I think Web 2.0 will thrive in this economic downturn. Just not yet.

The sort of start-up that has a wafer-thin business model overly dependent on advertising will struggle and many will disappear (and quite a few won’t be missed). Investment in new ideas will become much harder to secure. But Web 2.0 is about more than creating a widget, tagging a picture or poking a friend.

Web 2.0 has yet to scratch the surface of business processes. Whilst consumer habits have changed dramatically since 2000, most organisations internally still look the same. And so they will continue during most of 2009. Going into a recession, the instinctive reaction is to freeze. Stop doing anything and wait to see what happens. Few people would start a new project or reinvent how they do business at this moment in time. And those who would ought to think twice. However, once we are well and truly up to our necks in recession (what we see right now is just the beginning), then businesses will start to rethink the management and processes that led us down down this path. It is at that point that Web 2.0 has the potential to play a significant role.

In short, the next few months will undoubtedly bring more doom and gloom stories about Web 2.0 and related technologies (let alone everything else going on in the world). But the wise will use this time to get organised for when the shock of the recession eases and people start paying serious attention to what happens next.

Technorati tags: Web 2.0 | Enterprise 2.0

Competition vs Opposition

Fabulous article in the February issue of Harvard Business Review print ed. (Actually, there’s a few.) The opening line:

“Top executives are good at competing, but when they come up against opposition rather than competition, they flounder.”

A simple example from the article. When Coca-cola battled Pepsi to get their soft-drink vending machines into schools, that’s competition. When parents decided they didn’t want soft-drink vending machines in schools, that’s opposition. (At least one of the soft-drink companies started producing bottled water…)

I can think of another example. Get ready to fall over in shock and surprise… Microsoft. Microsoft is usually at its best when competing, preferably against an established player. (Increasingly hard to do, when you’re the world’s largest software company.) Microsoft is rubbish at coping with opposition. Probably because it doesn’t happen very often. The last time they really faced opposition, it was called Netscape. The solution? Create a near-identical product and compete. Say hello to Internet Explorer. (We’ll not get into a debate about whether the tactics used to compete were fair). The opposition this time around? Google. Microsoft’s tactic? Same as before – turn opposition into competition. Round 1: Try and build a near-identical service. That hasn’t gone so well so far. Round 2: “Hmmm, who could we buy to achieve our goal…” 🙂

Trying to tackle opposition by getting into their space and competing head-on doesn’t always work. Worse still, it can be a disaster. Instead, the article advocates turning the tables on the opposition. And highlights that, in this instance, business can actually learn a few tricks from politics. Adopt your opponent’s issue/solution as your goal but pitch an alternative path for getting there. Tracking Microsoft’s activities in cloud computing and software as a/+ service, I suspect some opposition tactics are also in play but a lot less visible in the news than their traditional methods.

The ability for any and all organisations to cope with opposition is going to become an essential management skill (I wonder if it is on MBA courses). The Internet’s role in social networks combined with mobile phones and instant messaging services have introduce a whole new audience of potential opponents, better organised and more vocal than ever before. Us.

Technorati tags: Microsoft vs Google

Living Company vs One Hit Wonder

In his book ‘The Living Company’, the author Arie de Geus points out that the average life span for a multi-national company (Fortune 500 or its equivalent) is between 40 and 50 years. For companies in general, it’s a massive 12.5 years. In comparison, the average for human beings is 75 years, suggesting we do a better job of living our lives than we do running companies… Not really a fair comparison given that, currently, it is not legal to acquire, merge or break up human beings.

Can Web 2.0 start-ups become living companies?

When MySpace was acquired in July 2005 for nearly $600 million I remember wondering what exactly was NewsCorp buying – a company or a fad, more akin to buying the rights to a movie that will be hot property (and high revenue, hopefully) for a limited period of time. Now, a New York Times blog has articulated the lifespan of a social networking site:

¨They inevitably self destruct because sooner or later using it will stop being fun and start being embarrassing.¨

It’s an interesting statement and makes you wonder if Facebook, having turned down a $1 billion offer from Yahoo in 2006, risks ending up with the 1p box (comparing acquisitions to the UK show ‘Deal or No Deal‘). The New York Times references a great article by Cory Doctorow on Information Week that nicely sums up the challenge of longevity for social networking sites:

¨It’s socially awkward to refuse to add someone to your friends list — but removing someone from your friend-list is practically a declaration of war. The least-awkward way to get back to a friends list with nothing but friends on it is to reboot: create a new identity on a new system … Once that happens, poof, away you go — and Facebook joins SixDegrees, Friendster and their pals on the scrapheap of net.history¨

I love that quote because it goes against the assumption being made by techies that we don’t want to keep creating new profiles on different social networking sites and therefore need a ‘standard’ to integrate them all (see: OpenSocial). Most strategy and management books will tell you it easier (and more successful) to kill something and create from new than it is to change an established business/process/product/whatever, despite the hassle involved in starting from scratch all over again. People experience the same when moving house – do you seamlessly migrate all of your belongings or do you have a bit of a clean-out in the process?

So what will Facebook be worth in 4 years time? (The duration of the advertising deal that was part of Microsoft’s $240 million investment for a 1.6% stake.) I think it is a mistake to assume the value will be higher then that it is today. Some things just aren’t built to last…

Related Links:

Filed in the Library under: Social Networks

Technorati tags: Web 2.0; Social Networks; Social Networking ; Facebook