| The Ultimate Business Machine Technology, business And, not least, about by: Bernard Teo
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Mon 26 May 2003 The CommonsCategory : Commentary/commons2.txt Talking about the Commons. I had the chance to spend almost three weeks in Boston once - because I had the luck to be attending SIGGRAPH and then MacWorld - and I remember the Boston Common. It's a nice wide open green space in downtown Boston. The Boston Common and The Tragedy of the Commons - somehow I've always got them linked. I suspect I must have first come across this phrase while trolling the Harvard Square bookshops. I believe the Asian psyche could benefit from a cross-pollination with this Western notion of the need to have self-restraint while using a shared space. Too often, the Eastern notion of "family first, harmony above all" gives people a license to leech. The Tragedy of the CommonsCategory : Commentary/commons.txt I've finished reading "The Third Chimpanzee" by Jared Diamond. Where it ends, and "The Future of Ideas - The Fate of the Commons in a Connected World" (by Lawrence Lessig) takes off, is this concept of "The Tragedy of the Commons". Life is all about making trade-offs. There is no such thing as a free lunch. "Economists distinguish rivalrous and nonrivalrous resources... A rivalrous resource presents more problems. If a resource is rivalrous, then we must worry both about whether there is sufficient incentive to create it and about whether consumption by some will leave enough to others... If a rivalrous resource is open to all, there is a risk that it will be depleted by the consumption of all. "This depletion of a rivalrous resource is the dynamic that biologist Garrett Hardin famously termed 'the tragedy of the commons'. 'Picture a pasture open to all,' Hardin writes, and consider the expected behaviour of 'herdsmen' who roam that pasture. Each herdsman must decide whether to add one more animal to his herd. In making a decision to do so, Hardin writes, the herdsman reaps a benefit, while everyone else suffers. The herdsman gets the benefit of one more animal, yet everyone suffers the cost, because the pasture has one more consuming cow. And this defines the problem: Whatever costs there are in adding another animal are costs that others bear. The benefits, however, are enjoyed by a single herdsman. Therefore each herdsman has an incentive to add more cattle than the pasture as a whole can bear. As Hardin describes the consequence: "'Therein is the tragedy. Each man is locked into a system that compels him to increase his herd without limit - in a world that is limited. Ruin is the destination toward which all men rush, each pursuing his own best interest in a society that believes in the freedom of the commons. Freedom in a commons brings ruin to all.'" Sun 25 May 2003 The Hair-Cut MachineCategory : Commentary/haircutmachine.txt I had my hair cut at a Japanese-style S$10/10-minute hair-cut shop. It's a great example of a business machine. Please read Seah Chiang Nee's excellent summary of the current state of business in Singapore - "A sign proclaims $10 for 10-minute haircut and I realised why" - which could be dugged out from a Google search. Firstly, it's clean. And they promise to get it done in 10 minutes. Because of SARS, I didn't want to hang around in close proximity with 10 other people for more than 10 minutes. So that was fine by me. The barbers/hair-dressers (mostly girls) look trendy enough to risk a try. So, the business proposition was right on the money. Next, they solved the problem of pilferage (the hand-in-the-till problem) by using a machine to collect the money. You slot a $10 note into a machine and get a waiting card. In one fell swoop, they did away with the cost of having a cashier. And collected useful statistics. For example, the owners can have (if they want to) accurate records of the day's takings, the pattern of use (e.g., are they busier in the morning, noon or night?), how long people have to wait, the time each customer took (I've seen one done in five minutes, some in fifteen), which of their crew worked the fastest, the slowest, etc...? All these can be used to fine-tune the system. Another part of the system concerns the need to be hygienic. They have a steriliser at each workstation - for the combs, brushes, vaccumn cleaner nozzle - anything that comes into contact with the customer. The cloth that keeps away the falling hair does not come into direct contact with your neck. They use a disposable liner. They were creative in finding ways to be hygienic and ended up with a "unique selling proposition". And here is a good example of the concept of "triage" in action. There are many other services a hair salon offers - a hair wash, hair colour, manicure, even gossip, and a constant stream of chatter designed to create opportunities to sell more services. The $10 hair-cut shop pruned away at these possibilities to select only those they want to offer as a finely integrated package - quick, reasonably priced, hygienic, no-chatter, and, because they only do hair-cuts, they need a much smaller space than any other salon, which results in lower rents and greater flexibility in finding available shop space, and greater turn-over (say, $360 per hour, for a six-seater shop, multiply by 10 hours from 10 am in the morning till 9 at night, equals around or above S$1500/day, assuming 40% capacity). I believe the best business ideas are those that emerge as a finely balanced gestalt. If you can do that, and it makes money, and you can run it using mere mortals (e.g., you don't have to worry about an up-and-coming David Gan or Georgie Yam stealing away your customers - because there's no time). Now, if you can do that, what do you do? Open as many branches, as fast as you can. Systems ThinkingCategory : Commentary/connections.txt I'm trying to relate the idea of making a good living, through running a business that works like a machine, to knowing how to find the pieces of technology that can help you to actually build that business machine. Without a system, a business cannot scale, and the owners cannot disengage from the daily grind long enough to dream about where to take that business next. With a system, you've already built the procedures that can be done by rote into the system. That forms the spine of the business. In the fashion of the Seaman-Campbell-Keown-Vieira axis, which forms the central spine of the Arsenal team, allowing the creative types like Pires and Henry to run rings round the opposition. (Actually I'm a life-long United fan.) If you have a good system in place, you can have a lot of flexibility in planning your staffing. You can experiment with the combinations - hardworking journeyman types, to people with a lot experience, to the young, fresh and idealistic - because a good 80% of the business processes have been made to run like clockwork. In a system we have in place for a client (that's regrettably withdrawing from here, but had contributed a fair bit to our own passive income), they recruited a 65-year-old temp with vast claims-handling experience a year back. Old though he was, I've observed that it was possible for him to learn the system in a week - score a point for the Mac school of user-interface design. He's helped by a system that presents him with only the data that needs to be focussed on, that collates the data and shunts it to the next step in the process, that knows how to roll everything back when he makes a mistake. That allows him to concentrate on what he is good at. But I did not come to praise our system. No, only to bury the idea that IT has to be talked about in terms like "three or four-tier client-server", "hot or cold start", "Used-Case diagrams", "Black-box or White-box testing". I actually get demands to typecast a system along these lines (whatever do they mean?) by IT managers before we even have a chance to talk about the business needs. I believe there is a place for everything, and everything in its place. The trouble is that the IT Manager as GateKeeper is in the wrong place. To build the Ultimate Business Machine, we've got to start the discussion from the business end of things, from the systems, procedures and processes that are needed, and work progressively downwards into the technical implementations, making innumerable trade-offs along the way. All the while, we need to remember that we're trying to build a "machine" that will deliver consistent services, of a consistent quality. We're going to have to resort to triage, making decisions in favour of cases that work 80% of the time, and move on. I believe that if you proceed along these lines, you can force each technical decision to be reviewed against its contribution to the business objective - does it make the business run like a high performance engine? - and then choose the right tool for each job. It's possible to hold a technical discussion wholly at a descriptive level, in terms of capabilities. It's possible to insist that a technical person speak plain English. Get him to draw a picture of what he's trying to do. If he can't, it's possible that he's really clueless. You've got to have faith in your ability to discern the truth. Thu 22 May 2003 The Third ChimpanzeeCategory : Commentary/chimp.txt I was just reading this in "The Third Chimpanzee" by Jared Diamond : "Every part of the earth is sacred to my people. Every shining pine needle, every sandy shore, every mist in the dark woods, every clearing and humming insect is holy in the memory and experience of my people... The white man... is a stranger who comes in the night and takes from the land whatever he needs. The earth is not his brother but his enemy... Continue to contaminate your bed, and you will one night suffocate in your own waste." - From a letter written in 1855 to President Franklin Pierce by Chief Seattle of the Duwanish tribe of American Indians. It's my birthday or at least it was just a half hour ago, so I thought I'll just write something without any definite purpose. Mon 19 May 2003 Speaking of KiyosakiCategory : Commentary/kiyosaki.txt I cannot speak of Kiyosaki without thinking of Singapore's own Dennis Wee, who calls Robert Kiyosaki his mentor. A year ago, I had thought of selling an apartment my family owned but I had time on my hands, so I thought of doing it myself, without a housing agent. So I went to attend a real estate talk. Not just any real estate talk but the one conducted by the guy who has his face plastered all over the place - at the back of the buses, in a Red Indian outfit in the papers, the drop-out made good - Dennis Wee. I wasn't disappointed. It was a spectacle. Our own version of the Reality Distortion Field. I wish I can sell like Dennis Wee. At the end of the free talk, I signed up for the full S$800 course. He's that good. But like he says, it's all in your mind. To change your life, you've got to start with your mind. Clear your mind and the rest of your life will follow. It's one year ago this month since I was quite thoroughly entertained. But I've been led to Robert Kiyosaki, Anthony Robbins, and Tom Hopkins. Not to mention a full year of 20% discount whenever I placed an ad on the classified pages. PS : instead of selling the flat, I tried renting it out. I got a tenant within 45 minutes of the first call. Was it the training, or beginner's luck? I'll soon find out because the year is up. Anyway, I saved enough on commission to pay for that S$800 course. Sun 18 May 2003 PassivityCategory : Commentary/passivity.txt I believe Robert Kiyosaki has a point. We should try to understand money, learn how to accumulate money wisely and, as a counterpoint, realise how our lives could be destroyed if we let money control us, rather than the other way around. I've found Rich Dad, Poor Dad and The Cashflow Quadrant very useful and they're things I want to teach my kid, e.g., how to tell the difference between an investment and an expense. Many people commonly get these ideas mixed up, to their life's detriment. I'm not saying that it's easy to implement these ideas, just because I've read them. I'm finding that it still needs a lot of hard work to, not just accumulate investments, but also to turn them into healthy inflows of passive income. Passive income is income you earn without being actually "there", e.g. from collecting rent from other people using your physical or intellectual property. A guy who lives two doors down my street collects rent from properties accumulated by his late father. Nice work (or non-work) if you can get it. The rest of us have to work a bit harder to create assets attractive enough for others to want to employ, for a fee. It's not that I have anything against hard work. Quite the opposite. But I've seen how you can work yourself into the ground and leave no time for your family. You've got to strike a balance. It takes vision to see a need that people are willing to pay money to satisfy. Then it takes a lot of ingenuity, creativity and management skills to crystallise it into a system that can satisfy that need consistently and (apparently) effortlessly, so that it can be operated by mere mortals and scaled to fit whenever and wherever possible, without your needing to be there. So there you have it - two essential sets of skills. I believe that, if you can solve a problem at a reasonable cost for others, nobody should begrudge you your wealth. That's the root of capitalism. But it's not enough to want money. You need to see the relationship between passive income (the most efficient way to earn an income) and a system that can generate that income on your behalf, in a way deserving of the adjective "passive". That system is your very own business machine. And, in most cases, you can bet that there's an IT element in there, somewhere. Thinking for a LivingCategory : Commentary/thinkingliving.txt I thought about calling this weblog "Thinking for a Living" because that's what I do - I get paid for having ideas and figuring out how to get them implemented - initially for an assortment of government agencies, and then, for the company that I helped to start. After seven years of plenty (even though somebody once told me you can't make money as Mac developers), we're now, the three of us, living off the fat (somewhat) and that's why I've got time to waste writing this weblog. One thing I've learnt, and I don't know if anyone wants to hear, but here goes (if you've come back, you must have found something interesting) : One. Michael Gerber (The E-Myth) is right. Most small businesses don't work. In The E-Myth Revisited, Gerber describes, through the experience of a bakery shop owner, how you can start with a bright idea and fall towards despair, chained to the treadmill, doing everything yourself, struggling just to keep from slipping behind. It was, for me, a powerfully visceral image. Life as an entreprenuer was often like that. Despair was always just around the corner. I've learnt that you've got to make your business work like a machine, able to make money even when you're not there. The irony was that we did manage to help other people run their business like a machine, through the systems we designed and built for them. While these businesses ran like clockwork, we ran ourselves to the ground. So, it's time to go back to the drawing board. But how do we build the ultimate business machine of our own? Can we succeed? Stay tuned, to find out. Sat 17 May 2003 The Soul of a New MachineCategory : Commentary/soulmachine.txt If a business executive attends a course, say, on MS Access, do you think he'll learn the things that can help him become a better General Manager? If all he's learning are these - designing database tables, understanding normalisation, linking tables, writing an Access program, creating forms - who's helping him put all these into a context that can draw on his other skills? Perhaps knowing how to make queries on the data could be useful but, even then, how many executives can understand SQL, much less want to remember it after the course? It's the same kind of thinking that says that our school-children ought to be taught things like "PC Internals", so that they'll know what research engineers do when they grow up. The problem is: the specific technologies change with time. They're all likely to be obsolete by the time these school-children go to work. Unless you're a software developer, you should work at picking up IT skills at a higher level. But is this - i.e. learning how to learn - a skill that can be taught? I've taught, say, FileMaker and even Photoshop courses where the people try to memorize and then regurgitate specific steps. It doesn't work. It'll be better if people learn how to "connect the dots"; to have the confidence to look at each novel thing with an eye as to how it can be made to work in concert with the rest of the things they already know how to do well. I believe that if we can do that - and we'll need to know that it is a problem if we don't - we'll have smarter, more creative people, better businesses, and ultimately, a richer, more resilient economy. Tue 13 May 2003 Computers as TheatreCategory : Technology/theatre.txt Let's try to connect some dots. What's the relation between creativity and the arts and computer technology? Brenda Laurel (among others) has tried to synthesise all these elements in her book "Computers as Theatre". I try to summarise some of the ideas she has covered there. When we go to a theatre, we go with a set of expectancies, e.g., a play has a beginning, a middle, and an end. We start with a set of possibilities. As the play progresses, the number of new possibilities introduced into the play falls off radically. "Every moment of the enactment affects those possibilities, eliminating some and making some more probable than others." "Making some more probable than others." When confronted with a novel situation, we will attempt to match it with prior experiences, which will help us prune away at the universe of possibilities to arrive at a smaller subset of probabilities that is easier to handle. A sensitive computer interface designer will take advantage of that. When the original Macintosh presented the user with a desktop metaphor, the purpose was to help the user "get a handle on things" and have expectancies for how things were going to work. For example, one can easily guess that the trash can is for things you want to throw away. Like drama when you're immersed in the illusion, you connect with the things unfolding on the screen and "go with the flow". This idea doesn't stop at the interface. Consider its implication for the technique called object-oriented programming. Imagine you're walking along a beach and you pick up a pebble. At once, holding the pebble, the universe of things you can do with it is vastly reduced. You can skim it across the water or put it in your pocket, but you cannot eat it. Its nature determines the things you can do with it. And that makes programming easier. When the user selects a line of text, the menubar can be made to highlight the actions you can do with text and disable actions that are not appropriate. That is Brenda Laurel's "flying wedge" analogy at work - "a plot is a progression from the possible to the probable to the necessary". Both the user and the programmer are guided by a plot, which keeps both focused on just a few pertinent things at a time, while engaged in a meaningful dialogue. Contrast this with the DOS command line. Type C>DELETE or any other command and you can see that there's an infinite number of possible verb-object combinations, most of which get you "syntax error". If computers have become more useful machines as a result of the approach pioneered by the Mac, you can see just how much of an impact ideas from the arts have had on this. It may just make you think a bit differently the next time you enjoy a good movie. Think about Alfred Hitchcock's Psycho - did you actually see Janet Leigh being knifed in the shower scene? You've been led to imagine it, in all its gory details, by the preceding action and accompanying soundtrack. Your imagination does a better job than anything the old Master could do, and saved him some money too, not having to shoot it. How economical.) Connecting the DotsCategory : Technology/dots.txt I remember a Steve Jobs interview with Wired where he talked about having "enough dots to connect". I just looked up my magazine collection and, yes, there it is (Wired Feb 1996). I'm glad I hadn't thrown that away. Jobs : "Creativity is just connecting things. When you ask creative people how they did something, they feel a little guilty because they didn't really do it, they just saw something. It seemed obvious to them after a while. That's because they were able to connect experiences they've had and synthesize new things. And the reason they were able to do that was that they've had more experiences or they have thought more about their experiences than other people." Jobs : "Unfortunately, that's too rare a commodity. A lot of people in our industry haven't had very diverse experiences. So they don't have enough dots to connect, and they end up with very linear solutions without a broad perspective on the problem. The broader one's understanding of the human experience, the better design we will have." Not all those who wander are lostCategory : Commentary/creativity.txt I'm reading "The Creative Economy - How People Make Money from Ideas" by John Howkins. Just five pages into the book, I hit upon this paragraph and it expands on the image of the Zen master that I left off the last article. "The moment of creativity is sometimes accompanied by a sense of heightened consciousness, even an explosion of consciousness. When we are being most creative, we often feel most vividly alive, and more highly focused, even to the extent of becoming less aware of everything else." Bear with me while I meander through a few other notable quotes from the book. I can make a connection between all these, and technology and innovation on the Mac (I promise). "Socrates said the unexamined life is not worth living. When Shakespeare's Lear wants to express complete futility, he says 'nothing will come out of nothing'. We admire creative people because they do make 'something from nothing'; and we may fear them for the same reason. When people stop being creative, in an important sense they stop living. As Bob Dylan sings, 'He who's not busy being born, Is busy dying.' The Egyptian lawyer and economist Kamil Idris, who became Director-General of the World Intellectual Property Organization in 1997, says "It is a simple formula: to live, we must create.' Without creativity, we could not imagine, discover or invent anything. We would not have fire, language or science." And a final quote from J. R. R. Tolkien, "Not all those who wander are lost." Read more ... |
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