Tuesday, August 30, 2005
Intuit, known for its personal finance and small-business software, is looking at a play in healthcare administrative software. This according to The Economist (8/27). The initial product is something called Medical Expense Manager, which helps individuals and families keep track of their own expenses...but it sounds like this is only a beginning of something substantially larger. (Interestingly, Medical Expense Manager emerged from work done by an Intuit engineer to keep track of his own medical expenses.)
It's noteworthy that Clayton Christensen included Intuit on his (short) list of companies that have been successful as "serial disruptors." For more on Christensen's ideas about innovation, see my book review here , also this post.
As always, nothing on this weblog should be considered as investment advice.
Friday, August 26, 2005
MULTICULTURALISM AND SLAVERY
Smithsonian magazine (9/5) also has an article about the institution of slavery as practiced today in the country of Niger.
The writer of the article, together with a local antislavery activist, visited one slaveowner and tried to persuade him to change his ways. "Try and understand the enormous mental pain of a slave seeing his child given away as a present to another family," said the writer. To which the slaveowner replied:
You Westerners. You only understand your way of life, and you think the rest of the world should follow you.
Gosh, that line of reasoning sounds familiar.
If the slave-driving business doesn't work out for this man, maybe he can get a job as a professor at an American or European university.
RENEWABLE ENERGY, 1892 STYLE
Rudolph Diesel, inventor of the engine that bears his name (that's the "diesel," not the "Rudolph") originally intended it to run on plant-derived fuels such as peanut and castor oil. This according to Smithsonian magazine (9/05), which quotes the inventor as follows:
Motive power can be produced by the agricultural transformation of the heat of the sun.
I'm not terribly sanguine about biofuels as a major factor in the solution of today's energy problems, although they may eventually be able to contribute 5% or so of auto/truck/train fuel. And that should not be sneered at--we may be entering an energy era in which many different techologies will play their part (as opposed to a single dominant technology).
Anyhow, it's interesting to know that Diesel was thinking of biofuels way back in 1892.
Thursday, August 25, 2005
AN INTERESTING HISTORICAL PARALLEL
The attitudes reflected by the San Francisco board of supervisors in their vote on the USS Iowa (see post below) are evidently not all that new.
I recently picked up the memoirs of American naval officer Daniel P Mannix, who served from about 1900 through 1928. Mannix tells of some events surrounding the Washington Disarmament Conference of 1921, which he was required to attend as an escort for some foreign dignitaries.
This was the height of the pacifist craze. The League of Nations was to make wars impossible. All armed forces would be demolished. The resulting savings in taxes would be used to benefit the poor and needy.
My group of delegates came from a certain European country, a very little one, that had no navy. They were insulted at being met by a naval officer in uniform (we were ordered to wear our uniforms). The chief of the delegation, a little fat man, informed me that he was "a man of peace" and I "no better than a hired assassin." I called a taxi to take them to their hotel and the chief delegate got into a terrific row with the taxi driver over where he was to put his suitcase. As a dove of peace he was the most bellicose person I've ever met.
Everywhere in the city was the same anti-militaristic attitude. Even walking in the streets, I was met by scowls and often muttered imprecations. This happened to all men in uniform. It seemed to me that they deserved better of their fellow countrymen after risking their lives for them. I am sure a number of these "pacifists" would have attacked me if they dared...One evening, as a representative of the Navy, I was required to attend--in full uniform--a large formal dinner given by the English Speaking Union. The speaker was Mr Arthur Balfour, the famous British statesman. In his speech he assured us that the United States did not need a Navy; we could depend on England to protect us. His remarks about our Navy were so abusive that people turned to glare at me. I felt that I should have vanished like the devil in a pantomine through a trapdoor but unfortunately none had been provided...At the end of his speech, the audience gave him an ovation. A number of them, both men and women, rushed up and actually kissed his hand...A high dignitary of our own Episcopal Church turned to me and said enthusiastically, "A wonderful speech, was it not?" I began to wonder whether I was crazy or whether everyone else was.
I was well aware of the strong pacifist feelings that existed during this time period, but had put them down to naivete and wishful thinking in the aftermath of the dreadful casualties of World War I. It was something of a surprise to learn how much true nastiness coexisted with the naivete.
(The Mannix excerpt is from the very interesting book The Old Navy, edited by Mannix's son Daniel P Mannix 4th)
Saturday, August 20, 2005
THERE ARE NO WORDS
The San Francisco city supervisors have voted against allowing the battleship Iowa to be permanantly docked in their city as a memorial ship.
Iowa (BB-61) was commissioned in February 1943. Her first assignment was to operate in Scandinavian waters, as part of a force intended to suppress the activities of the German pocket battleship Tirpitz. Later in the same year, Iowa carried FDR and other leaders to Casablanca and then Teheran.
In 1944, Iowa passed through the Panama Canal en route to the Pacific. Battles in which she was involved include: Marshall Islands, Wake Island, Truk, Marianas, New Guinea, the Philippines, and Okinawa.
Recommissioned in 1951, Iowa supported U.S. and allied operations in Korea. After being decommissioned for a second time in 1958, she spent 20 years in mothballs, before being activated once again in 1984. In 1989, an explosion in a gun turret resulted in the deaths of 47 sailors and ended Iowa's career as a combat ship.
The vote against Iowa by the San Francisco city supervisors wasn't even close: 8 to 3. “If I was going to commit any kind of money in recognition of war, then it should be toward peace, given what our war is in Iraq right now,” said Supervisor Ross Mirkarimi.
It now appears that the ship will be berthed in Stockton, an agricultural port town on the San Joaquin River known as the home of California’s annual asparagus festival. Stockton officials expect the ship to attract more than 100,000 visitors per year.
For my analysis of the psychology of people like the San Francisco supervisors and their supporters, please see my post An Incident at the Movies.
UPDATE: It all strikes me that the San Francisco supervisors are driven by what I call "temporal bigotry." They are so limited in their perspective that they have no interest in going beyond the issues of their own time to learn from the issues and experiences of other eras. More on temporal bigotry here.
HOW NOT TO DO MARKET RESEARCH
At a used bookstore, I picked up a book called Rethinking Systems Analysis and Design, by Gerald Weinberg. It's a pretty old book--1982--but contains much that is still of value--a lot of it with applicability beyond the information technology field.
In his discussion of how to analyze situations, Weinberg tells the story of a suburban commuter railroad. Several suburbanites had written the railroad asking for a minor change in the train schedule. They wanted to be able to go into town in mid-afternoon to spend the evening with spouses or friends. There was a train that already passed the station at 2:30 but did not stop--all they wanted was to have a scheduled stop added for their station. Here is the response they got:
Dear Committee: Than you for your interest in Central Railroad operations. We take seriously our committment to providing responsive service...
In response to your petition, our customer service representative visited the Suburbantown station on three separate days, each time at 2:30 in the afternoon. Although he observed with great care, on none of the three occasions were there any passengers waiting for a southbound train.
We can only conclude that there is no real demand for a southbound stop at 2:30, and must therefore regretfully decline your petition.
This seems unbelievable, but Weinberg claims that it is actually true. And he has more stories along the same lines:
1)A systems analyst in a consumer products company heard that some marketing reps in another building might need terminals to access the marketing database (this was before the days of readily-available PCs). He circulated a questionnaire with the question:
How much use do you presently make of the marketing database?
Since making use of the marketing database required a 6-block walk to another building, the usage was zero. The analyst concluded that no terminals for the reps was needed.
2)Engineers at a computer manufacturing company were asked to improve a new version of the company's CPU by adding an efficient method for subroutine calls. After two months, the engineers responded that they had studied a sample of existing programs, and hardly any of them used subroutines in situations where efficiency really mattered. The request was declined as "frivolous."
(Weinberg provides two more examples along the same lines, one at a brokerage firm and one at a university.)
It's only fair to note that in none of these examples was the perpetrator a professional market researcher (except possibly in the railroad example, and I would be very dubious about the quality of any "marketing" activities at a commuter railroad in 1982). But I bet it wouldn't be too hard to find similar cases that were perpetrated by market research professionals.
It's interesting to speculate about the aggregate economic harm done by those who fall into seemingly-obvious conceptual traps like these.
Friday, August 19, 2005
TERRORISM AND HUMANISM
Bret Stephens, writing in The Wall Street Journal (8/19), quotes from an audiotape attributed to terrorist leader Abu Musab al-Zarqawi. In the tape, Zarqawi denounces democracy on the following grounds: In a democracy, "the one who is worshipped and obeyed and deified, from the point of view of legislating and proibiting, is man, the created, and not Allah." He goes on to say that this is "the very essence of heresy and polytheism and error."
What Zarqawi is really attacking here is, specifically, secular humanism.
Isn't it interesting that so many of those who are most strongly opposed to the War on Terror--those who believe that we should "understand" the Zarqawis and "resolve their grievances" and "coexist" with them--are themselves self-defined secular humanists? I"m not sure exactly where this observation leads, but it seems to me to be an important one.
Bret Stephens goes on to make a connection with Thomas Mann's "The Magic Mountain." It's a book that, to my shame, I haven't read, but according to Stephens it contains a sustained conversation ("actually, an intellectual brawl," as he puts it) between a character named Naphta and another named Lodovico Settembrini. The latter is "a self-described free-thinker and humanist who is convinced that improvements in technology and the refinement of our moral senses are leading inexorably to the 'universal brotherhood of nations.' " He is a socialist and believe that international arms control treaties will abolish war.
Naphta, on the other hand, is "an intellectually caustic Jesuit, who admired the Christian orders of the Middle Ages for their 'pure, unadultrated religious egoism.' He faults bourgeois democracy for the moral degradation of man and has no patience for liberals: 'It is ultimately a cruel misunderstanding of youth to believe it will find its heart's desire in freedom,' he says. 'Its deepest desire is to obey." He calls for a principle that unites asceticism and dominion. That is what I call the necessity of terror.
When he first read Zarqawi's text, Brett Stephens' first thought was this is pure Naphta.
At the end of Mann's novel, Settembrini and Naphta fight a duel. Settembrini gets to take the first shot but isn't willing to kill his opponent, choosing instead to fire his gun in the air and leaving himself exposed. Naphta, however, can't do it either, and shoots himself.
Stephens concludes as follows:
This month is the 50th anniversary of Mann's death. Meanwhile, pressure is mounting on the administration to get out of Iraq. If it does, it will show the Zarqawis of the world that we are a nation of Settembrinis, who cannot muster the moral self-confidence to save ourselves by killing them. The only question then will be whether the Zarqawis are themselves the heirs of Naphta, who will do us the favor of self-destructing. Let's hope truth is as good as fiction.
WHITHER OIL PRICES?
John Browne, who runs British Petroleum, has an interview in the September issue of Smart Money, and has some interesting thoughts on oil prices.
Lord Browne thinks oil prices might average $40 or so for the next several years, but "Very long run, we still think the range of oil prices is $20 to $35." He also says that exploration projects are evaluated under criteria requiring decent return on capital even at $20.
Of course, if he's wrong and the prices do stay in the $50 & above range for a prolonged period of time, then he's leaving a lot of money on the table, since there are many projects that would have been funded at these levels that won't make it under a $20 criterion. On the other hand, he's protecting BP from potential losses--it would be no fun at all to invest billions in projects that pay off at $50 and above and then to find that the long-range price falls to $20 or so.
My sense from general reading is that many oil companies are using criteria in the $30-$40 range for investments, but that $20 is pretty conservative. Anyhow, interesting thoughts from someone who is deeply enmeshed in the world of oil.
(140 years of oil price history here.)
As always, nothing posted at this weblog should be considered as investment advice.
UPDATE: And, for a very different view: Goldman Sachs expects oil to stay above $60/barrel for the rest of the decade. Also, Karen Spector, global energy strategist at J P Morgan, takes a middle-of-the-road view, viewing $35-40 as a "reasonable but conservative assumption." (according to Financial Times, 8/20)
My own view would be closer to Ms Spector's (and favoring the high side of her range) than to either Goldman or to Lord Browne. But it's really only a guess, and oil is so dependent on geopolitical factors that I don't think anyone can really project the future with any confidence.
Tuesday, August 16, 2005
THINKING AND MEMORIZING
Jakob Dylan has a song that includes the following lines:
Cupid, don't draw back your bow
Sam Cooke didn't know what I know
Think of how much you need to know in order to understand these two simple lines:
1)You need to know that, in mythology, Cupid symbolizes love
2)And that Cupid's chosen instrument is the bow and arrow
3)Also that there was a singer/songwriter named Sam Cooke
4)And that he had a song called which included the lines "Cupid, draw back your bow."
(This is actually a post about education, not about music.)
"Progressive" educators, loudly and in large numbers, insist that students should be taught "thinking skills" as opposed to memorization. But consider: If it's not possible to understand a couple of lines from a popular song without knowing by heart the references to which it alludes--without memorizing them--what chance is there for understanding medieval history, or modern physics, without having a ready grasp of the topics which these disciplines reference?
And also consider: in the Dylan case, it's not just what you need to know to appreciate the song. It's what Dylan needed to know to create it in the first place. Had he not already had the reference points--Cupid, the bow and arrow, the Sam Cooke song--in his head, there's no way he would have been able to create his own lines. The idea that he could have just "looked them up," which educators often suggest is the way to deal with factual knowledge, would be ludicrous in this context. And it would also be ludicrous in the context of creating new ideas about history or physics. To use a computer analogy, the things you know aren't just data--they're part of the program.
I've seen no evidence that there exists a known body of "thinking skills" so powerful that they bypass the need for detailed, substantative knowledge within specific disciplines. And if such meta-level thinking skills were to be developed, I suspect that the last place to find them would be in university Education departments.
There are skills which facilitate thinking across a wide range of disciplines: such things as formal logic, probability & statistics, and an understanding of the scientific method--and, most importantly, excellent reading skills. But things like these certainly don't seem to be what the educators are referring to when they talk about "thinking skills." What many of them seem to have in mind is more of a kind of verbal mush that leaves the student with nothing to build on.
There's no substitute for actual knowledge. The flip response "he can always look it up" is irresponsible and ignores the way that human intellectual activity actually works.
None of which is to say that traditional teaching practices were all good. There was probably too much emphasis on rote memorization devoid of context--in history, dates soon to be forgotten, in physics, formulae without proper understanding of their meaning and applicability. (Dylan needed to know about Sam Cooke's song; he didn't need to know the precise date on which it was written or first sung.) But the cure is to provide the context, not to throw out facts and knowledge altogether--which is what all too many educators seem eager to do.
IS ANYBODY SURPRISED?
There are some people that you just can't meet halfway.
Saturday, August 13, 2005
WORTHWHILE ADVICE, CONTINUED
A couple of weeks ago, I mentioned some notes on management written by Raytheon CEO Bill Swanson. Raytheon is now issuing the complete set in book form, and it's even free.
Read what James Lileks has to say about those churches that would "divest" from Israel.
And see what Pamela has to say on the same subject...also, on recent events at a certain well-known university.
And also, read Michael Totten on the true roots of terrorism.
Friday, August 12, 2005
NEW FRONTIERS IN CHUTZPAH
Somebody (Mad Magazine?) once defined chutzpah as "the kid who murders both his parents and then demands that the judge show him mercy because he's an orphan."
Now, The New York Times has achieved an almost equal standing in the annals of chutzpah. In an article on 8/7, Damien Cave observes that Americans are not familiar with individual heroes from the Iraq war in the way that they were with heroes from earlier conflicts. He suggests that this is because "the military, the White House and the culture at large have not publicized their actions with the zeal that was lavished on the heroes of World War I and World War II."
Huh? It is specifically The New York Times, and other like-thinking media organizations, that have declined to publish or air significant stories about individual heroism in Iraq. Anyone who reads blogs on a regular basis has seen dozens of such stories. (See Chuck Simmins blog for one collection.)
Cave is quick to criticize "the military, the White House, and the culture at large" but seems to have little interest in looking at his own employer and industry.
UPDATE: Read this devastating analysis of NYT coverage.
Tuesday, August 09, 2005
Michael Morris, a professor at Columbia, has found that when stock price movements are described in terms of "agent metaphors," people tend to believe that the trend will continue more than they do when the same stock price movements are described in terms of "object metaphors."
For example, "Caterpillar jumped up by 5% today" will be interpreted differently from "The price of Caterpillar increased by 5% today," even though the two statements are semantically identical.
Moreover, Morris found that people--including financial journalists--tend to use agent metaphors more often when prices go up, and object metaphors more often when they go down. Why? "Think about if you're hiking, and you see something on the trail. It's either a rock or a toad. If it starts moving up, it's a toad. If it moves down, it's probably a rock. Evolution built into our brains that things that move up are alive. Things moving down don't provide that cue."
Morris goes on to say that "For the naive investor who's trying to make sense of the newspaper, the mental concepts that get triggered by agentic descriptions of uptrends may lead them to think that an uptrend is a meaningful signal for tomorrow, while the downtrend isn't a meaningful signal about tomorrow."
See Smart Money and The Economist.
Monday, August 08, 2005
Can you even believe this?
Isn't Virginia Tech a public institution? How can anyone imagine that something like this can be justified?
Hey, Larry Hincker--when you talk about "respecting cultures," how about showing some respect for the culture of the country you live in and that pays your salary?
Sunday, August 07, 2005
Sister Toldjah--as in "Toldjah So."
(For anyone who doesn't get it--the name is clearly a play on the rapper Sister Souljah.)
A CUSTOMER SERVICE STORY
In his very interesting book It's Not What You Say--It's What You Do, Laurence Haughton discusses customer service, along with many other aspects of business. He passes along this experience, which was related by Richard Coraine (who runs a NYC restaurant group).
I had just flown from New York to Atlanta and got to the hotel right after midnight. I hadn't eaten on the plane and thought I just needed a light snack before I went to sleep.
I called down for room service and aske for a bowl of chicken soup and crackers. Something, I don't know what, made the young woman on the other end ask me a question completely disconnected from my request.
"Are you feeling okay?" she inquired. "That's an order I get when somebody isn't feeling well."
"No, no, I'm fine," I said, clearing my throat. "Thanks for asking. I just got off a plane from New York and i have an early-morning business meeting. I'm hungry and I'm tired, but I'm fine."
She could have followed the hotel's proceures manual, saying, "Bowl of chicken soup, crackers, room 1125. That will be up in twenty-five minutes. Is there anything else?"
But she used her head, thinking that a guest calling for chicken soup and crackers and sounding like he's half asleep might not be feeling well.
Then she used her heart, which said, "If I wasn't feeling well, I sure would want someone to ask about me and show they care. I'll just see if there is something more I can do to make him feel better."
Then she had the courage to act on what her head and heart had told her. "I'm glad you're not ill," she said. "But still I'm going to put a note on this order to get everything to you quickly so you can have your soup and get to sleep fast."
I'll bet that young lady makes about eight or nine dollars an hour. Yet she did more to reinforce that hotel's brand with me than a million-dollar TV commercial. I totally experienced her heart. I totally experienced her intelligence. I totally experienced her courage to act. And I raved to everyone in my company.
Indeed. There are too many companies that are quick to spend money on ad campaigns focused on the excellence of their customer service--and to buy expensive "Customer Resources Management" software, which is sold under the mantra "get closer to your customers"--but never do the hard work of actually improving customer service at the level of the individual front-line employee. This involves, among many other things, enabling and reinforcing the kind of behavior demonstrated by the woman in the story.
In fact, many companies tolerate a culture which negatively reinforces such cutomer-oriented behavior. Coraine and Haughton refer to this negative reinforcement as "skunking."
If the young woman at the hotel who had taken Coraine's order for chicken soup and crackers had been told by the chef, 'Let him wait like everybody else!" when she requested the order be fulfilled quickly, that would be skunking her.
This is how the empathy effect is lost in many organizations. People come into their jobs with a spark, and instead of it getting fanned into a fire someone douses them with negativity, extinguishing their initiative.
You can put up all the posters you want to about the importance of "excellence" and "customer focus"--but, if you tolerate skunking--and if you define jobs and procedures so narrowly that people have no room to show initiative--you aren't going to get superior customer service.
I think the reason people tend to focus too much on the ad campaigns and the CRM software, rather than on the actual details of the customer service experience, is that the former things are more well-defined. It's pretty clear how you go about calling up the ad agency and mapping out a "we care about customers" ad campaign--or how you tell your IT people to go out and buy a CRM system. But actually working through the improvement of customer service is a much more ambiguous matter. I'm reminded of the guy who searched for his wallet under the streetlight, rather than in the dark corner where he'd actually lost it--because "that's where the light is."
Please note: I'm not saying by any means that CRM systems are useless. There are many cases where they can help in customer service and in sales. But the relative intangibles of customer service matter, too, and in many organizations they get far too little attention.
In future posts, I'll be discussing other vignettes and insights from Laurence's book.
Friday, August 05, 2005
KING DAVID, ARCHAEOLOGY, AND THE NEW YORK TIMES
An archaelogist thinks she has discovered King David's palace.
See how The New York Times chose to report the discovery (registration required).
Read what The Anchoress thinks about this kind of reporting (registration not required).
And speaking of the NYT, here's an interesting chart.
I'm just sayin'.
Thursday, August 04, 2005
...from Midwest Conservative Journal. Please make yourself at home and look around a bit.
Wednesday, August 03, 2005
OF POLITICS AND BULLDOZERS
Many "progressives," especially in the universities and in the liberal churches, have stridently condemned Israel's use of bulldozers (which Israel employs to destroy buildings used as bases for terrorist activity, as well as for the construction of its defensive wall.) They have lobbied for a global boycott of Caterpillar because it supplies heavy equipment to Israel.
Well, there's another place where bulldozers are being used right now. In Zimbabwe, bulldozers are being used by the government to destroy the homes of hundreds of thousands of totally innocent people, evidently for purposes of political retaliation.
I haven't heard much complaint about this use of bulldozers from all those "humanitarian" churchmen and professors.
I think these people focus on the use of bulldozers by Israel, for the most part, because this focus allows them to simultaneously;
2)Condemn U.S. foreign policy
3)Condemn a U.S. corporation
...and for a "progressive" churchman or college professor, evidently, nothing could be more delightful.
And if bulldozers are being used against innocent people, in ways that don't fit the above three criteria, these "progressives" just aren't very interested. They will weep over the destruction of the house of a terrorist mass murderer in the Middle East, but have no tears for the innocent in Zimbabwe.
UPDATE: Readers of this post may also be interested in this, this, and this. Also this and this.
Tuesday, August 02, 2005
MORE EXCELLENCE FROM MS O'MALLEY
Sheila passes along a vignette from her trip to Ireland.
It's not exactly your typical "what I did on my vacation" sort of thing.
What an incredible writer she is.
Monday, August 01, 2005
TODAY IN HISTORY
Donald Sensing reminds us that the First World War began on August 1, 1914. Don has a summary, and there is a fairly extensive entry at Wikipedia.
I'm not sure that most Americans understand just how devastating this war was for Europe. The casualty levels were immense, representing significant portions of an entire generation.
At the French military academy of Saint-Cyr (the French equivalent to West Point) a memorial was erected after the war with the inscription "To the class of 1914." Every single member of that class was killed in the war. (Reference here.)
UPDATE: The following passage is from F Scott Fitzgerald's novel Tender is the Night. The time is about 10 years after the end of the First World War. The setting is the battlefield of the Somme.
Rosemary waited tensely for Dick to continue.
“See that little stream—we could walk to it in two minutes. It took the British a month to walk to it—a whole empire walking very slowly, dying in front and pushing forward behind. And another empire walked very slowly backward a few inches a day, leaving the dead like a million bloody rugs. No Europeans will ever do that again in this generation.”
“Why, they’ve only just quit over in Turkey,” said Abe. “And in Morocco—”
“That’s different. This western-front business couldn’t be done again, not for a long time. The young men think they could do it but they couldn’t. They could fight the first Marne again but not this. This took religion and years of plenty and tremendous sureties and the exact relation that existed between the classes. The Russians and Italians weren’t any good on this front. You had to have a whole-souled sentimental equipment going back further than you could remember. You had to remember Christmas, and postcards of the Crown Prince and his fiancée, and little cafés in Valence and beer gardens in Unter den Linden and weddings at the mairie, and going to the Derby, and your grandfather’s whiskers.”
“General Grant invented this kind of battle at Petersburg in sixty- five.”
“No, he didn’t—he just invented mass butchery. This kind of battle was invented by Lewis Carroll and Jules Verne and whoever wrote Undine, and country deacons bowling and marraines in Marseilles and girls seduced in the back lanes of Wurtemburg and Westphalia. Why, this was a love battle—there was a century of middle-class love spent here. This was the last love battle.”
“You want to hand over this battle to D. H. Lawrence,” said Abe.
“All my beautiful lovely safe world blew itself up here with a great gust of high explosive love,” Dick mourned persistently.
AN UNUSUAL HONOR
Army Staff Sgt Dale Horn was promoted...to the position of sheik!