What recession?

2012/02/21 in Business-Technology, The New Instability by peg | No comments

The global financial crisis hit nearly four years ago in 2008 but America and Europe appear to still be stuck in the mud. Even the Asian market has softened. But is this a recession? Or are we seeing a reconfiguration of the economy as the technological seeds laid over the last few generations finally germinated and bear fruit? Prices for made goods are collapsing as the cost of manufacturing has plummeted, while the cost of sourcing and distribution has crashed, caught between globalisation and the Internet. Even innovation, the source of all those sexy new products, has been democratised with the investment required to development new products taking a nosedive. Our existing business models were not designed to thrive, or even survive, this this environment. While the current market is a challenge to navigate, a lot of the problems we’re seeing could be result of a collapse of antiquated business models rather than the collapse in demand that these businesses are intended to service.

The iPhone is a fascinating product. It was deemed a failure at launch, with analysts claiming that it was under powered and feature poor. It also emerged at roughly half the price the analysts expected. Fed into Apples impressive cross-channel marketing machine, some models were available in store while the full range (including engraving) was only available online. Launched in 2007, the iPhone, however, has become one of the key products that powered Apple to the largest quarter in the company’s history, with US$46 billion in revenue and US$13 billion in profit[1]. A huge success by any measure.

At the same time as Apple was rocketing up the global league tables we’ve been seeing retailers slashing costs and closing stores as revenues collapse. Book shops[2], clothing chains[3] and even electronic retailers[4] are putting their businesses to the knife. Some of this is due to softening demand. However, there appears to be two much larger trends which might have the lion’s share of the blame. Otherwise how do we explain why consumers keep buying all those iPhones?

First, prices for manufactured goods have crashed, driven down by competition and plummeting manufacturing costs. We’ve spent our time since the Industrial Revolution automating production, driving out waste and cost by systematising manufacturing and assembly, and then replacing people with machines. You can see this at the top end, where Apple introduced the iPad for US$500 rather than US$1000 as the analysts expected. At the bottom end we have the discount electronic brands who and providing you with basic but functional electronic goods at astoundingly low prices: DVD or MP3 players for less that $20[5], for example.

Second is the collapse of distribution as a source of business differentiation. A dirty secret of many businesses is that their entire value proposition has built around distribution: finding a product and moving it from source to customer. Thriving businesses were built on the back of this arcane art. Globalisation and the Internet, however, have democratised distribution, enabling anyone with a web browser to find and source the things they need (or just want), regardless of where on the planet these products are located.

We’re seeing a phase shift in the way the market operates. Consumer behaviour is changing as they take to Internet to seek out the best or the cheapest they can find globally[6], creating a vortex in the mid-market which is sucking the life out many well established brands[7]. At the same time many local high street retailers – department stores, clothing retailers and the like – are crumbling[8], squeezed between consumers who are shifting their shopping habits online, on one side, and dropping unit prices on the other, pushing down revenue for those sales that they do manage to capture. Traditional retailers are suffering, and we’ve just had worst Christmas shopping season since 1984[9]. At the same time online retailers are seeing record-breaking sales[10], as are manufacturers such as Apple. Companies which have adapted to this new environment are thriving; others just seem to be withering away.

Most businesses have historically relied on a distribution advantage to carve out their share of the market. Even all the way back to the era of the spice trade, businesses’ fortunes were made (and lost) due to their distribution capability. The Vasco de Gama’s[11] expeditions to the new world were driven by the desire to find a faster and less troublesome trade route — a distribution capability – to steal market share from Arab traders. The railroad robber barons of the 1800s controlled the path between factory and consumer. Hollywood studios were built on the backs of strong distribution networks[12] (though today they’re little more than middle men, having divested themselves of both production and cinemas after antitrust action from the U.S. government). More recently Walmart used an edge in distribution to become the largest retailer in the world. And, closer to home, your local department store, high street retailer or services firm had little to offer than their ability to bring the goods and services you need to a location close to where you live.

Large, multi-regional or multi-national firms were built on the back of strong long distance distribution. Small companies were built on the back of regional distribution; solving the problem of the last mile. Generations of consultants have assiduously applied Michael Porter’s five forces framework and, time and again, come up with a distribution strategy as the right thing to do.

  • Supplier Power. A strong distribution network destroys supplier power, as suppliers must go through the distributor to sell to the distributor’s customer base
  • Customer Power. Customers stick with the distributor as it’s to hard for them to find and source products themselves
  • Threat of New Entrants. The threat of new entrants is diminished, as it’s nearly impossible for a new competitor to build a better distribution network without anyone knowing
  • Threat of Substitute Products. Products don’t even need to be particularly good, as the challenge of actually getting products in front of customers makes the distributor king
  • Industry Rivalry. Distribution-based barriers tends to produce equilibriums for the existing players, as any improvement in one network is quickly copied by the others

The Internet changed everything.

  • Supplier Power. Suppliers can approach customers directly, and now play distributors off against each other to push margins down
  • Customer Power. Customers can access a large number of alternatives, some of which are free
  • Threat of New Entrants. Content costs, and not distribution costs, are now the barrier to entry
  • Threat of Substitute Products. Finding superior content products is easy
  • Industry Rivalry. Suppliers have become rivals, with companies such as Apple now engaging consumers directly

Louis CK, an American comedian, conducted a distribution experiment recently. He offered a self-produced video of live stand-up as a download on his website for the low price of US$5[13]. Handing over $5 provided you with a login allowing you to download a DRM-free video file. The video cost US$170,000 to produce (largely paid for by ticket sales at the shows which were recorded), with another US$32,000 going into the development of the web site. Twelve hours after the video was announced 50,000 people had bought it, earning Louis $250,000. Four days in it was 110,000 copies, over $500,000. After twelve days sales had hit one million dollars. This is quite a contrast to a traditional Hollywood distribution model, which would have seen the show commissioned, physical DVD (or even video cassettes) printed and shipped and a marketing campaign run. The middle men – the studios and their distribution networks – had been cut out, putting the creator of the content in control

New distribution models are emerging, and these models are not simply cheaper and more efficient versions of the models of the past. They’re different, and they require a new approach to how we package and price our products. Valve, a video game company, has developed a new distribution platform called Steam. Steam has been called the iTune of video games, as it allows customers to create an account, buy games, and then download these games to any computer associated with the account. What’s interesting is that Valve have been using Steam to experiment with the economics of video games[14], and they’ve discovered a few interesting things.

First they discovered that piracy is not a pricing issue. It’s a service issue. As Gabe Newell said in a recent interview:

The easiest way to stop piracy is not by putting antipiracy technology to work. It’s by giving those people a service that’s better than what they’re receiving from the pirates. For example, Russia. You say, oh, we’re going to enter Russia, people say, you’re doomed, they’ll pirate everything in Russia. Russia now outside of Germany is our largest continental European market. … But the point was, the people who are telling you that Russians pirate everything are the people who wait six months to localize their product into Russia. So that, as far as we’re concerned, is asked and answered. It doesn’t take much in terms of providing a better service to make pirates a non-issue.

—Gabe Newell, Valve co-founder

Next they start to experiment with price elasticity. Some initial trials were carried out where prices were varied without any announcements, and Steam enabling them to watch user behaviour in real time. After a baseline was established, and they throught they understood the dynamics of the market, they decided to try a highly promoted sale for a major title.

We do a 75 percent price reduction, our Counter-Strike experience tells us that our gross revenue would remain constant. Instead what we saw was our gross revenue increased by a factor of 40. Not 40 percent, but a factor of 40. Which is completely not predicted by our previous experience with silent price variation. …

—Gabe Newell, Valve co-founder

There’s a new dynamic at work here, one driven by global reach and low cost distribution, greased by social media.

Those new distribution platforms are allowing blockbuster games like Call of Duty to rack up one billion in global sales in sixteen days (that’s one day faster than it took James Cameron’s Avatar to reach the same goal), while games retailers are selling off or shuttering stores[15]. Most of the major video game developers are launching their own distribution platforms – such as Origin[16] by EA, and the AppStore from Apple – as there is no significant barrier to entry.

We’re starting to see similar stories with physical goods. BookDepository[17] is using cheap and efficient global logistics networks to make it more convenient to buy a book from the other side of the planet than to walk to the local book shop. Kogan[18], an online electronics retailer, has made this into an art from by combining low cost distribution with cheap manufacturing to create an agile, low cost model that might be a signpost of the future.

Kogan offers customer extremely low cost own-brand televisions, DVD players, digital camera, mobile phones, laptops, etc., delivered direct to the the doorstep. This uses a pull model, where insights from real time Internet search data are used to drive product development. In one instance the company saw a spike in searches for netbooks roughly six weeks before Christmas. Thinking they were onto something, a netbook was quickly specified in collaboration with their suppliers in China. Five weeks before Christmas, one week after they had noticed the spike, the product was complete and sent to testing, as well as being put up on the web site and added to the company’s current advertising campaigns. That same product went on to become their biggest seller for the Christmas season.

At the same time traditional electronics retailers are struggling. The shift to online is part of the problem, but dropping retail prices are pushing down revenues and making the situation worse; customers who shop on the high street are handing over less cash for the same goods. Harvey Norman, an Australian department store, is tying to combat the problem by moving away from goods who’s price is shrinking, reducing floor space for electronics and trying to shift more durable goods, such as fridges and lounge suites, who’s prices are holding up better. Other retailers are experimenting with smaller store which require less floor space (with consequentially lower rents), but struggle to stock a broad enough range to products to satisfy many customers. Even the luxury brands are in trouble, with low production and distribution costs allowing unscrupulous individuals to flood the market with cheap counterfeits of well known, and highly desirable brands.

Some companies are, however, thriving in this environment. Kogan is an obvious case, as is Apple. While the products Apple makes use the same commodity components as their competitors, as well as being assembled in the same factories and travelling in the same trucks, Apple manages to endow its product range with an aura that keeps customers coming back. Amazon has created a low cost purchasing environment that is crippling publishers while rewarding loyal customers.

At a local level we’re seeing business move from pure retail to focus on building a community that customers identify, and where the financial transactions are an incidental part of being a member of the community rather than an event the business is driving toward. The recent emergence of crowd funding tools such as Pozible[19] and Kickstarter[20] (who just funded their third project over one million dollars inside two weeks[21]) is just the nail in the coffin, as content and product creators realise that they don’t need much more than a good idea and well presented pitch to get going, rather than the backing of a major manufacturing and distribution business. Bookshops are coming back as they realise that they are part of a community, rather than just the endpoint of a low cost distribution chain[22]. Even big ticket items such as cars are coming up for grabs. Delta Motorsport has applied similar thinking to develop the E-4 Coupe, a 150mph (241kph) electric sports car built with a minuscule £750,000 ($1.2m) budget and just ten employees[23]. Delta expect it can put the E-4 Coupe into production for £4.5m, a fraction of the $1 billion or more required via a more conventional approach.

Some businesses are booming, and some are struggling, and there’s a good chance that we have a two speed economy. But this is not two speed in the traditional sense, where resources might be down but retail up. It’s a reconfiguration of the market, a Darwinian process where companies designed around high cost manufacturing and strong distribution die out, replaced by a new generation who don’t make the same assumptions. The market has definitly softened, but how much of the turmoil we seeing is due to a drop in a general consumer demand, and how much is due to a collapse in demand for the services provide by traditional businesses? Consumers have evolved, their behaviour has changed, and business needs to evolve with them.


References


1. Apple Inc. Q1 2012 Unaudited Summary Data↑
2. Eli Greenblat (February 17 2011), Borders, Angus & Robertson go bust, The Age↑
3. (January 31, 2012), Gasp at risk of folding, Herald Sun↑
4. Shane Fowles (February 1, 2012), Geelong workers sweat as 100 Dick Smith stores to close, Geelong Advertiser↑
5. Toshiba SD4200 Digital Progressive Scan DVD Player, Black. AU$17.74 @ eCrater↑
6. Andrew Fraser (May 27, 2011), Click goes the retail revolution, says Morphet, The Australian↑
7. Greg Roberts (December 8, 2011), Administrators try to save Fletcher Jones, Herald Sun↑
8. Martin Farrer (February 3, 2012), Game Group to offload overseas shops as UK sales plunge, The Guardian↑
9. Chris Zappone (February 6, 2012), Retail sales in worst showing since 1984, Sydney Morning Herald↑
10. Jason Jeffries (January 13, 2012), Record-breaking online sales for Christmas 2011, eWay eCommerce News↑
11. Vasco de Gama (1460-1524) was a Portuguese explorer who discovered a sea route from Portugal to the India in 1948, establishing a new spice trading route in the process. The voyage returning sixty times the original investment alone.↑
12. Working in Hollywood @ PEG↑
13. Louis CK: Live at the Beacon Theatre↑
14. Todd Bishop (October 23, 2011), How Valve experiments with the economics of video games, GeekWire↑
15. Keith Stuart & Mark Sweney (December 13, 2011), Modern Warfare 3 hits the $1bn mark in record time, The Guardian↑
16. Origin by EA↑
17. The Book Depository: Free shipping worldwide↑
18. Kogan Technologies↑
19. Tracey Lien (January 25, 2012), Will Make Games For Food… Or Funding,↑
20. KickStarter: We’re the world’s largest funding platform for creative projects↑
21. Ben Popper (February 20, 2012), Kickstarter gets its third $1M project in the span of two weeks with Order of the Stick, VentureBeat↑
22. Carolyn Webb (February 13, 2012), New chapter for bookshops in Greensborough, The Age↑
23. Chris Knapman (June 3, 2011), Electric Delta E4 at Crystal Palace, The Telegraph↑

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We saw the future, and there wasn’t an e-wallet to be found

2012/02/15 in Business-Technology by peg | 3 comments

Do NFC payments – with their tap-and-go simplicity – herald a revolution of the shopping experience? Or is NFC just an attempt to force more of our daily transactions onto payments platforms where their owners can claim a usage tax? The sales pitch is a promise of simpler, faster and more secure payments, allowing us to grab our goods and quickly get on with what we were doing. The reality is that the payment is only responsible for a small portion of the time wasted during the buying journey. Other trends we’re seeing have much more potential to revolutionise the shopping experience, and they do this by moving the purchase away from the till to allow consumers to transact where and whenever they need. The huge investment in NFC means we can expect to see NFC terminals at most of the shops we frequent. However, at the same time we can expect NFC to be quickly eclipsed by other solutions which do a much better job of streamlining the buying journey.

Vendors are trying to convince us that the future involves NFC, smart phones and e-wallets. You might have seen the adds on TV; a demographically appropriate actor buys something trivial such as a pack of gum or can of soft drink by simply tapping their NFC enabled credit card or phone against a pay point before scampering off to some enriching activity. NFC, we’re told, will make the payment so quick, so easy, that we’ll barely even notice it. No more waiting in queues while the person in front of us fumbles with their purchase. And if we add an e-wallet then we can easily manage all these wonderful transactions via an app of some sort. Life will be good.

The problem with this vision is that it doesn’t align with reality. The next time you’re waiting in a checkout queue somewhere – be it a café, big box retailer or clothing store – spend the time to count how long it takes the people in front of you in the queue to hand over the goods they want, wait for the clerk to tally up their purchases, and to make their payment before they can escape. Was the payment – swiping the card and punching in a PIN – a big part of the time spent? Or was the time dominated by the clerk scanning barcodes into the till to find the total? I’d be surprised if the payment was more than a small fraction of the time spent, as most of the time we waste shopping is sucked up the the need to find the goods we want and tally up their prices; the payment is just an annoyance at the end.

NFC technology might be bling, but all the effort is aimed at the smallest part of the buying problem, the payment. Shaving a second or so off the payment will make little difference to how much of our life is wasted while shopping. The pack-of-gum example is a corner case carefully selected to show tap-and-go in the best possible light. How often do you simply pick up one product next to the till, wave your card near the payment terminal, and then sally forth into the rest of your day? When your at a restaurant? How about when your at the supermarket? Clothes shopping? Or that trip to the big-box hardware store on the weekend? Most of our time is sucked up the the need to find the goods we want and take them to the register (place our order and wait for it to be made), wait while the merchant tallies what we owe them, and then we make the payment. Why worry about slicing another second of an already short payment when there are bigger problems to solve?

The ideal use-case for NFC?

The ideal use-case for NFC?

A number of non-payment tools and technologies are emerging which are moving the payment away from the till, allowing us to entirely avoid the need to sign a check, do the chip-and-pin thing, or even tap-and-go. The booming gift card market and and near ubiquitous Internet connected smart phones are allowing us to rethink the buying process.

Amazon's new mobile shopping application, transforming every aisle in every store into an Amazon shopfront

Amazon's new mobile shopping application, transforming every aisle in every store into an Amazon shopfront

Aisle buying, for example, builds on the consumer habit of checking prices on their smart phones while standing in the aisle[1]. Why just give them the price when, with one more tap on the screen, the consumer could simply pick up the product and walk out of the store, showing a receipt on their smart phone on the way out. No need to visit the register. No NFC required. Amazon realises the potential for aisle buying and has released an app which allows customers to scan a bar code, view the price and place an order, converting every shopping aisle in every retailer into a shopfront for Amazon.

Purchases are moving away from the till, as the relationship between customer and merchant moves from exclusively face-to-face to include online interactions, and interactions mediated via social media and smart phone apps provided by the retailer. Pizza chains already allow you to order via an app – both from home and from within their restaurants – and we’re seeing business-consumer relationships founded on Facebook move into the real world with Facebook Credits and Checkin allowing retailers to interact with their customers wherever they are. Allowing customers to pay via the same channels is only one step further.

Square, for example, provides a till-replacement based on an iPad app. The app allows retailers to do the usual things, effect payments and tally the day’s sales. It also has a nice feature where a merchant can allow an established customer to put a purchase “on account” simply comparing an image of the customer displayed in the app with the person standing in front of them. No money or slivers of plastic pass back-and-forth, there’s no tap-and-go, the transaction is simply noted with the tap on an on screen button. Tesco Korea has taken the idea of aisle buying a step further and created virtual stores in subway stations, taking the store to the people when the people don’t have the time to visit the store. Find what you want, snap a photo of the QR code, and the product is already on its way to your house. It didn’t take long for this idea to catch on, and we’re already seeing virtual shops pop up in other countries, from simple stickers on a shopfront through to the creation of virtual stores in public places.

Woolworths' virtual shop at Flinders Street Station in Melbourne

Woolworths' virtual shop at Flinders Street Station in Melbourne

The problem with all the NFC payment hype is that it wells from a backward looking view of how we use technology. Tomorrow will be the same as yesterday, but with more fins, shinier chrome, and flying cars. NFC requires an huge investment in a new generation of payments technology – technology focused on facilitating traditional face-to-face payments – just when society is starting to move away from this style of transaction.

Our habits are changing, and rather than changing with us payments providers are doubling down on their existing approach, trying to push even more transactions through their existing infrastructure. E-wallets and tap-and-go result in some nice ads, but future of payments lives somewhere else.


References


1. Aaron Smith (Jan 30, 2012), The rise of in-store mobile commerce, PerInternet↑

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You can’t buy innovation

2012/01/25 in Innovation, Uncategorized by peg | No comments

Why is it so hard to incent our companies or teams to do anything innovative? Something tangible that makes a difference to the top or bottom line. The vast majority of innovation programmes seem to deliver little more that some nice demos before the programme peters out, with stakeholders often happy to return to their usual duties. The problem is that innovation is neither a product or a process, nor is it a skill; innovation is an artefact of culture, and culture is something that you cannot buy, hire or implement. The reason that most companies fail to innovate – despite significant investment in innovation – is that innovation is a result of culture and their culture actively prevents them from realising anything innovative.

Innovation (whatever that is[1]) has become the Mecca for modern business. In today’s turbulent environment everyone is looking for that new idea or product, that innovation, which will give them an edge. Nowhere is this more obvious than the crowded market places for smartphones and mobile applications, where crowds of companies compete to become the next iPhone, Angry Birds or FarmVille. It’s hard to stand out in a crowded market and you need something unique, something innovative to grab the public’s attention.

In their quest for the next big (innovative) thing, management teams engage innovation consultancies, create innovation functions and programmes, and hire the hot new skills which claim to be the next source of innovation. (Yesterday it was portfolio management; today, Design Thinking, next some are claiming that it’s the skills provided by a liberal arts degree.) The hope it that a tangible investment will result in an intangible outcome, as if innovation is something that can be standardised and transformed into a repeatable process. None of these approaches work reliably.

Innovation, of course, extends to more than casual games and mobile phones. Apple seems to have established a track record for innovation across a number of sectors, Amazon has proved itself to be a lot more than a simple web retailer, while 3M has a long history of bringing interesting products to market (PostIt notes, Scotchguard, Goretex…). We’re also seeing success at the bottom end of the market, where companies such as Kogan[2] are finding new (innovative) was to products to waiting customers at a price point radically lower than traditional bricks and mortar retailers.

At the individual level we find the innovator situated in a broader context. The questing of Pablo Picasso, Jimi Hendrix, Laurie Anderson and Miles Davis was woven into and built apon ideas that they found around them as they tried to make sense of the world. Picasso’s desire to draw a picture showing all sides of the subject once built on Cézanne’s abstract shapes and resulted in cubism. Miles Davis wanted to bring the some of the soul from Sly Stone’s work into the world of Jazz, and created fusion and Bitches’ Brew in the process. New work – innovation – is created by cultural accretion, as the artisan pulls in tools, techniques and ideas from the community around them as they search for the best way to express their aspirations. The innovator’s role is to provide the focus, the drive to realise a new idea, that enables these previously disparit threads together. The context that enables them to do this is the culture, the thick soup of ideas that that’s been simmering for generations.

Picasso's Weeping Woman (1937)

Picasso's Femme en pleurs (1937)

The common thread running through innovators — both businesses and individuals — is cultural. They approach the problem of innovation obliquely, if they approach it at all. Jon Ives, for example, is on record as claiming that Apple “just makes products that we would love to own ourselves”. Innovation is not something discovered, rather than something intentionally designed. “I’ll play it first, and tell you what it is later”, as Miles Davis said. Rather than invest in innovation functions and processes, or hire innovation gurus, and striving to be innovative, they are focused on solving problems. Tools, techniques and skills (such as Design Thinking) are pulled in as needed to solve a problem, instead of being implemented in the hope that they will instil innovation in whatever we’re doing. Sometimes the focus, the drive to realise a new idea, comes from the top-down, as in Apple’s case. Other times it works bottom-up, as with 3M’s more organic approach to innovation that allows individuals to vote with their feet.

Whether organic or structured, innovation is the result of two things. First is a rich and diverse cultural soup full of the ideas and skills that the innovator can draw on. A culture that values the learning and investigation needed to constantly enrich the soup, and one that extends beyond the wall of the organisation or individual to draw on, and appropriate, ideas an needed.

Jim Jarmusch on biting

Jim Jarmusch on biting

Second is the imperative, the desire, to follow through on an idea, to realise an idea or find a more elegant solution to a problem. Sometimes is means providing the time and space to develop and idea, but often it means proving constraints to drive the creative process. These constraints might involve time and money, forcing a team to solve a problem faster or more cheaply than a conventional approach would allow. Or the constraints might be written into the requirements, such as Steve Job’s desire to eliminate all but one button to create a more elegant solution.

The failure of many efforts to instil innovation into existing organisations is that they focus on the tools, and forget that innovation is the result of a culture more than it is a process. Without the drive to try something new, and permission to pull in the ideas and tools are most valuable, any investment in innovation will just result in little more than a bright flash followed by silence. Innovation is not something you can buy. It’s the result of the organisational culture you have create, and culture is the hardest thing to change.


References


1. What is innovation? @ PEG↑
2. Kogan↑

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The top posts for 2011 were …

2012/01/09 in Business-Technology by peg | No comments

And the top ten posts from the last year — as recorded by Popularity Contest — are:

  1. Knowledge Workers in the British Raj
  2. Problems and the people who solve them
  3. Working in Hollywood
  4. World of Warcraft in the workplace
  5. The future of (knowledge) work
  6. BPM over promised and under delivered
  7. The north-south divide
  8. Cloud computing’s long game
  9. Your mobile phone is making us stupid
  10. Have we reached peak SI?

Happy New Year all!

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Outsourcing in an increasingly complex world

2011/11/16 in Business-Technology, IT Strategy, Publications by peg | No comments

Sometimes posts become a tad to long and unwieldily to drop onto the blog. One such post was a thing I put together around some work I’ve been doing over the last few years on outsourcing. A friend suggested that, rather than letting it languish, it could be interesting to clean it up and publish the result as a (short) ebook; which is what I’ve done.

Find the blurb below, and to can grab the complete text from the iBookstore or Lulu (epub) (Amazon is in the pipeline).

Outsourcing in an increasingly complex world

Outsourcing in an increasingly complex world

by Peter Evans-Greenwood

Support independent publishing: Buy this e-book on Lulu.

Pressure on margins is driving organizations to increasingly rationalize and externalize supporting functions as they search for more efficient and flexible delivery approaches.

Most common approaches to outsourcing center on establishing target service levels and a unit cost, treating the negotiation of an outsourcing engagement in a similar fashion to the procurement of other materials that the business needs.

Outsourcing, however, is becoming more complicated as we move functions closer to the heart of the business into the hands of partners and suppliers. This represents a shift from an approach based on paying invoices for the raw materials we need to run the business, to one based on delegating core, business-critical functions to suppliers, and then requiring them to deliver the outcomes that we need.

Crafting a successful outsourcing engagement in this environment requires us to align the supplier’s incentives, and therefore their objectives, with the client’s business drivers. It’s not enough to take a piecemeal approach, imposing additional requirements and constraints in the hope that these will shape supplier behaviour.

It’s a truism that what gets measured is what gets done; outsourcing is no different. Existing approaches to crafting outsourcing agreements attempt to shape supplier behavior by imposing large and inconsistent sets of requirements, with the result that both parties search for loopholes in an attempt to optimize their position.

A successful contract will be based on the customer’s business drivers, aligning supplier incentives with them to ensure that the agreement drives the right behaviors

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Is Salesforce.com already legacy IT?

2011/11/15 in Business-Technology, Cloud & SaaS, IT Strategy by admin | 2 comments

The more I think about it, the more I feel that we need to rethink what “application” means.

The IT industry – and therefore “application” – has been defined by businesses’ need to acquire IT assets. The roles companies play in the industry have accreted around this need, as I’ve pointed out before[1].

The big shift we’re seeing in the market at the moment is a move from companies wanting to acquire IT, to a need to engage services enabled by IT. I know, for example, one airline that has externalised flight planning and pays per flight plan, rather than worrying about the tools need to support a team of flight planners. It’s a capability and process centric view, rather than a technology centric view.

If we follow this line of thought through then we quickly realise that the future of IT in business will be determined by the need to knit together a fabric of IT enabled services, many of which will be obtained externally. I don’t need a project portfolio management solution, I need a portfolio management capability backed by the tools and skills required to make it work. I don’t need a CRM solution (SaaS or not), I need a sales management and reporting methodology (Holden? Miller Heiman?) supported by technology to enable it to scale. It’s outside in thinking, rather than inside out.

What will the industry that accretes around this new need look like? If we look at many of the current on-demand / SaaS vendors, then they could best be described as enterprise software, but in the cloud!. Take the old model and make it multi-tennanted. We should probably call this Cloud 1.0 (where MySpace was social media 1.0). Cloud 2.0, however, will be something different and might be just over the horizon, rendering the current incumbents obsolete, legacy while they’re still young.


References


1. Business models for the old rules of IT @ PEG↑

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Death of the shopping mission

2011/11/14 in Business-Technology by peg | No comments

When did you last go on a mission to buy something? Something specific that you had decided you needed. Were you looking for a book to read, heading to a nearest bookstore to browse the shelves? Was it a trip to the local big-box store to stock up on toilet paper and other household odds and ends? Or did you wander around a department store at the local mall looking for something to wear? Our behaviour – consumer behaviour – has changed. Shopping has historically been a search problem: how do we find the products we need need? Today, though, we increasingly buy on impulse, selecting the cheapest – or the best at the most competitive price – from the wealth of products and merchants around the global. The shopping mission is going the way of the dodo. If we see a book we like, then we add it to our list at Amazon or Book Depository and it’s delivered direct to our front door. We’re getting household consumables delivered direct to our homes. And we’re even sourcing clothes online where we can find lower prices and a larger selection. Our behaviour is changing, and the retailers and merchants who don’t adapt are being left behind. A lot of the turmoil we’re seeing in the current economy is likely due to a reconfiguration of business, driven by the changes in consumer behaviour.

We used to engage in a shopping mission, a quest to find the goods we need to solve problems that we know we have. This was a journey that would bring us into contact with quirky in-store marketing displays designed to influence our purchasing decision. Product companies tried to build brand awareness, hoping to create a spark of recognition that, when you found yourselves standing in front of the shelves, would tilt you toward selecting their product over the others. Will be it Heinz tomato sauce? The store’s home brand? Or something gourmet from a boutique manufacturer. Merchants worked hard to ensure that they had the best selection of products they could find – the brands that would pull the customers into their store rather then those of the competition.

Standing before the grocery shelf or clothes rack, we would sort through the brands on offer, trying to find the one that we though to be the best value. This roughly translates into selecting the best quality that we could afford. The only products and information at our disposal was what the retailer chose to present us with, unless we were willing to trudge over to another shop so that we could we see what products it had on offer (and what it was willing to tell us about them). The result was usually a compromise: we’d select the best product we could see in front of us, knowing that it was probably neither the cheapest we might find if we kept searching, nor would it be the best we could find. Finding a better solution to our problem – that pair of jeans with a nicer fit, or the tomato sauce with just a hint of something interesting – was too hard.

The world has changed a lot since then. Firstly, globalisation means that it is now possible to reach around the global, conducting an extensive search for the cheapest, or the best (at the most competitive price). This is as simple as typing a few words into Google or visiting you favourite comparison shopping site. Secondly, quality is a solved problem. Twenty years ago that store brand ice-cream or tomato sauce, or the no-name t-shirt, were obviously inferior to the brand name product. Twenty years is a long time, and manufacturing’s relentless focus on quality management over that time means the cheapest product in the market is virtually indistinguishable from the brand names. They were probably even made in the same ingredients or components in the same factory by the same people.

Consumers no longer need to compromise. With little difference between products and the ability to source them from around the globe, many consumers opt for the cheapest they can find from the global market. Nor are consumers who are willing to pay a premium restricted to selecting from the products on offer locally, reaching around the globe find to the exact product they want at the best possible price.

“Price comparisons would be between first and second, or fourth and fifth. What we’re seeing now is a consumer who shops either on price, or on quality – the number one premium, or the retail price point. All the middle brands have gone.”

Sue Morphet, CEO PacBrands[1]

The balance of power has shifted from retailer to consumer, and the shopping mission is collateral damage. A consumer standing in front of the gaggle of tomato sauces offered by a merchant now has enough information to make an informed decision, and a brand means nothing unless it offers something unique. Consumers are buying the cheapest product, or they are buying the most interesting product (to them). The mass-market brands we grew up with, those labels we trusted because they were reliable, are being demolished, caught in a no man’s land between cheap and premium[2].

An avid reader wanting a specific book will source it from an online retailer such as Amazon or Book Depository who can offer lower prices and a larger selection, delivered direct to the front door. The time poor professional at the supermarket will often simply pick the cheapest bottle of tomato sauce they can see in front of them, knowing that it will be as good as any of the other. That teenager interested in those green sneakers with black skulls will try on their friends for size and then use an comparison shopping site on the Internet to find the best deal globally. Now that the consumer is in control, and they have the information and services they need at the tip of their smart phone, they are becoming much more impulsive with their approach to buying the goods they want.

The cost of finding the goods and services has plummeted, and consumers are responding by taking a much more opportunistic approach to purchasing. Rather engaging in a search to find goods we need, we’re deciding to buy them impulsively once a need is recognised. Consumers are building relationships with organisations that provide the premium products they desire, or who can be relied on to provide them with the lowest cost items that can be found. Purchases are made opportunistically, built on the shared social connection that has already been established. Customers skip across channels – both real and virtual – learning more about the company’s products and how they can help them. Eventually they realise that there is something they would like, and purchasing is now simply a matter of acknowledging their desire. They might purchase a TV from a company known for bringing cheap but innovative electronics to market, one more focused on putting all the features the customers want into one box, rather than trying to up sell and cross sell. It might be an expensive meal at a restaurant, triggered by the knowledge that a table had just become free for that night. It could the milk man offering to drop off some veg and a steak with the morning milk and bread, guaranteed to arrive before you leave for work. Or it might be that premium computer or tablet with that carefully designed case that you were playing with at your friend’s house.

Retail is reconfiguring, splitting into the cheapest and the best, with a gap appearing the middle. Apple, for example, seems to be the only consumer IT brand still experiencing robust growth and profits[3], with the majority of PC manufactures struggling to pull slim margins from a declining market. At the other end of the market, Kogan Technologies is rapidly building a profitable business[4] around a low cost, direct to consumer model founded on using a community of low cost manufacturers to rapidly create cheap but functional products target at specific consumer needs. Harvey Norman, a traditional bricks-and-morter retailer, is seeing revenue fall and profits slump[5].

The new generation of companies – the Apples and Kogans, the Zaras and the explosion of boutique fashion houses – are playing to our new tendency to buy impulsively. They build relationships with their customers, allowing them to skip across channels without purchasing, to reduce the resistance to transacting when the time comes. They avoid sales and regular discounting so tht there’s no reason to hold off a purchase. Some, such as Betabrands, are turning this art into a science, using our desire to be seen as original and our tendency to want to grab bargains when we stumble across them to overcome our reluctance to buy something we can’t touch and feel and accelerate their sales cycle[6].

A chasm is opening up under the traditional mass-market brands, brands that rely on the shopping mission, while companies which can establish themselves at one of the two ends of the spectrum are seeing robust growth. Companies caught in the middle, companies built around the traditional shopping mission are seeing their margins decline and revenues fall, unable to compete. The shopping mission is dying, and it appears that many companies might die with it.

Update:


References


1. Speech at the Australian Institute of Company Directors lunch in Brisbane, May 26, 2011.↑
2. Eli Greenbla (Aug 30, 2011), Heinz cans Coles, Woolworths, The Sydney Morning Herald↑
3. Charles Arthur (July 2011), Apple profits up 124% year-on-year after record iPhone sales, The Guardian↑
4. Neha Kale (August 2011), Kogan Technologies reports 100% increase in revenue, PowerRetail↑
5. Anhar Khanbhai, Harvey Norman profits fall 20%, Connected Australia↑
6. Amy Wallace (October 2010), Whimsy (and clothes) for sale, The New York Times↑

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Have we reached peak SI

2011/08/03 in Business-Technology by peg | 2 comments

Have we hit the peak for systems integrators (SIs) (just as we appear to have reached “peak oil”), and it’s all downhill from here? While SIs are doing well at the moment, structural changes in the IT market suggest that the long term forecast is not all sunshine and roses as some pundits are predicting. With IT spend migrating from IT departments (the SI’s traditional buyer) into the lines of business, the ongoing shift to smaller projects delivering on-demand (rather than on-premesis) solutions, and the replacement of traditional support arrangements with outsourced and managed services, it’s hard to see how SIs will continue to grow when demand for their services seems to be tipping into decline. Globalisation, software as a service (SaaS) and cloud computer are reconfiguring the IT landscape and SIs look like they will be the big losers.

Predictions for the continued growth of the SI market are based on the understanding that companies are consuming more IT today than they were yesterday, and the assumption that increased IT consumption will result in tidy profits for SIs. Predictions are a funny things though, based as they are on historical trends. Guess that the market will continue to rise when you’re in the midst of a bull market and you’ll be right, most of the time. That is until something happens, something you didn’t anticipate, something that catches you unawares. The assumption that SI revenue is tied to IT consumption might no longer be true. New tools such as SaaS and cloud computing are enabling line-of-business leaders to step around the traditional IT department and engage with technology directly, bypassing the SIs traditional relationships in IT and providing them with fewer opportunities to sell their wares. At the same time the shift from on-premises to on-demand solutions – solutions which the business is happy to rent rather than own – is slashing the effort required to install, configure and integrate these new solutions, often by as much as seventy to eighty percent. On-demand solutions also have much lighter support needs relying on self-help wikis, users forums and power users, leaving the SI with little more than a small help desk to manage. With only limited access to this new class of IT buyer, dramatically smaller projects, and lower support revenue, the SIs role as IT enabler seems to be in decline. All good things come to an end though, and you usually only realise that the end has come after it has already passed. IT consumption might be going up, but there’s a good chance that SI revenue could soon be going down at the same time.

SIs are fundamentally sandwich shops[1]. When we don’t have the time or money to maintain our own kitchen or make our own sandwiches it can be more efficient to head over to the local sandwich shop to pick up what we need. Their margins are thin and revenue is largely tied to the size of the sandwich you just bought, so they’d really like you to buy a larger and more expensive sandwich. (Notice how sandwiches have grown so much bigger over the years, and everything is now gourmet?) And, of course, pre-made sandwiches are always a lot cheaper than special orders. This sandwich shop model is something that was established early on in the history of business IT. How else could companies afford to access the rare (and expensive) IT skills they needed to create all the systems they need? This might be a payroll system, or stock management, sales pipeline reporting, or the dreaded enterprise resource planning (ERP). Consuming IT used to mean hiring an SI to build and integrate something for you.

The world has changed since then. Back when I started in the industry my home computer couldn’t hold a candle to the beast I was given at work. Today, however, my shiny new 17″ MacBook Pro makes the locked down Windows XP laptops I’m offered seem like a bit of a joke. A new breed of business manager has crept into the business while the world has changed, these are people who grew up with technology and are comfortable solving their technology problems on their own. They know that there are alternatives to the expensive solutions proposed by the IT department (solutions that IT will engage an SI to deliver), and they’re happy to use these alternatives. Why spend a seven figure sum and wait a year for the IT department’s perfect, enterprise-wide project portfolio management solution when there’s one that is good enough, one you can buy on-demand via a company credit card, and one which you know will be up and running in a couple of weeks? We might argue about the regret cost[2], but the art of business is to make a timely decision and then make it work; it’s not to sit on your hands and wait for the perfect solution which will be delivered sometime in the distant future. While demand for new IT solutions might be growing, every time a business manager steps around IT to engage and on-demand solution SIs have one less opportunity to sell their wares.

At the same time we find that these on-demand solutions – when SIs do get their hands on them – only provide a fraction of the revenue that a tradition on-premisis solution does. Time is money for an SI (literally, as most avoid risk by sticking to time and materials contracts) and fielding a SaaS solution takes only a fraction of the time required for a more traditional solution. There’s no hardware to commission with SaaS or cloud computing, nor are there disks to wait for or backup strategies to create. (You still need to worry about business continuity, but that’s another post.) There’s also little chance for customisation, and integration tends to be via standard APIs or pre-built adaptors. It’s not uncommon for a SaaS project to be eighty percent smaller than the more traditional solution. Fewer resources on ground and fewer billable hours means that that the SI can expect their revenues to head in the same direction: south.

We’re also seeing the erosion of SI support revenues. Support used to encompass both the application – in terms of application maintenance, patching and security – and the users – with training and a help desk. Many SaaS and cloud providers don’t want to provide traditional support services as it erodes their margins, margins based on huge scale and little human contact. One solution is to engage an SI to provide these services for them, either on a client-by-client bases or as part of some sort of alliance. A more attractive solution is to move – as much as possible – to a self support model where clients support each other via user forums or a Google search. We soon find that a much smaller help desk will suffice as it’s only required to be the point of last resort, or to support the more technologically illiterate users.

Taken together, these trends – reduced access to buyers, lower project revenues, and lower support revenues – seem to show that the future is not as rosy for the SIs as we first thought. Demand for IT might be growing, but growing demand for IT no longer implies growing demand for the services provided by SIs. The final nail in the coffin is the fairly recent move into SaaS by established IT application vendors. Microsoft has gone on record as wanting to capture a greater percentage of IT spend as license revenues, converting SI installation and customisation costs into licenses by providing clients with prepackaged configurations which can be turned on at the flick of a switch. Rather than pay for a SaaS CRM and then engaging an SI to configure it to your liking, you pay for the SaaS CRM along with a canned sales methodology (Miller Heiman[3]? Holden[4]?) which works out of the box (as it were). Integration between SaaS solutions is also being converted into a configuration option as SaaS vendors sign alliances – just as Google and Saleforce.com did with GoogleForce – enabling these alliances to offer complete application suites which work together out of the box.

Whichever way you look at it, now is not a good time to be a SI.


References


1. Business models for the old rules of IT @ PEG↑
2. The price of regret @ PEG↑
3. Miller Heiman: The Sales Performance Company↑
4. Holden International: Outsell You Competition↑

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BPM over promised and under delivered

2011/07/01 in Business Process Management by peg | 6 comments

One Saturday night the other week I was typing away on a book that I’m working on (probably called The new instability. How cloud computing, globalisation and social media enable to you to create an unfair advantage) and I let out what was probably a quite involved tweet without any context to explain it.

BPM has under delivered as it's rooted in Taylorism – *there is one true way to do the work* – but today we need to support multiple ways.
2011/04/16 7:35 pm via EchofonReplyRetweetFavorite

Recently I’ve been thinking about the shift we’re seeing in the business environment. The world seems pretty unstable at the moment. Most business folk assume that this is simply a transition between two stable states, similar to what we’ve seen in the past. This time, however, business seems to be unable to settle into a new groove. The idea behind the book is that the instability we’re seeing is now the normal state of play

Since Frederick Taylor’s time we’ve considered business – our businesses – vast machines to be improved. Define the perfect set of tasks and then fit the men to the task. Taylor timed workers, measuring their efforts to determine the optimal (in his opinion) amount of work he could expect from a worker in a single day. The idea is that by driving our workers to follow optimal business processes we can ensure that we minimise costs while improving quality. LEAN and Six Sigma are the most visible of Taylor’s grandchildren, representing generations of effort to incrementally chip away at the inefficiencies and problems we kept finding in our organisations.

This is the same mentality – incremental and internally focused, intent on optimising each and every task in our organisations – that we’ve used to apply technology to business. Departmental applications were first deployed to automate small repudiative tasks, such as tracking stock levels or calculating payrolls. Then we looked at the interactions between these tasks, giving birth to enterprise software in the process. Business Process Management (BPM) is the pinnacle of our efforts, pulling in everything from our customers through to suppliers to create the optimal straight through processes for our organisation to rely on.

Some vendors have taken this approach to its logical extreme, imagining (and trying to get us to buy) a single technology platform which will allow us to programme our entire business: business operating platforms[1]. They’re aligning elements in the BPM technology stack with the major components found in most computers under the (mistaken) assumption that this will enable them to create a platform for the entire business. Business as programmable machine writ large.

The problem, as I’ve pointed out before[2], is that:

Programming is the automation of the known. Business processes, however, are the management and anticipation of the unknown.

Business is not a computer, with memory, CPUs and disks, and the hope of creating an Excel with which we can play what if with the entire business is simply tilting at windmills.

The focus of business is, and always has been, problems and the people who solve them. Technology is simply a tool we’ve used to amplify these people, starting with the invention of writing through to modern SaaS applications and BPM suites. While technology has had a previously unimaginable impact on business, it can’t (yet) replace the people who solve the problems which create all the value. People collaborate, negotiate, and smash together ideas to find new solutions to old problems. Computers simply replicate what they are told to do.

We’ve reached Taylorism’s use-by date. Define the perfect task and fit the man to the task no longer works. The pace of business has accelerated to the point that the environment we operate in has become perpetually unstable, and this is pushing us to become externally focused, rather than internally focused. We’re stopped worrying about collecting resources to focus on our reactions to problems and opportunities as they present themselves. Computing (calculating payrolls, invoices, or gunnary tables) is less important as it can be obtained on demand, and we’re more concerned with the connections between ourselves and our clients, partners, suppliers and even our competitors. And we’re shifted our focus from collecting ever more data as it becomes increasingly important to ask the questions which enable us to make the right decisions and drive our business forward.

Success today in today’s unstable environment means matching the tactic – process – to the goal we’re trying to achieve and our current environment, with different tactics being using in different circumstances. Rather than support one true way, we need to support multiple ways.

There has been some half steps in the right direction, with the emergence of Adaptive Case Management (ACM)[3] being the most obvious one. A typical case study for ACM might be something like resolving SWIFT payment exceptions. When the ACM process is triggered a knowledge worker creates a case and starts building a context by pulling data in and triggering small workflows or business processes to seek out data and resolve problems. At some stage the context will be complete, the exception resolved, and the final action is triggered. Contrast this with the standard BPM case study, which is typically a compliance story. (It’s no surprise that regulations such as SOX drove a lot of business processes work.) BPM is a task dependency tool, making it very good at specifying the steps in the required process, but unable to cope with exceptions.

So what do we replace the Talyorism’s catch cry with? The following seems to suit, rooted as it is in the challenge of winning in a rapidly changing environment.

Identify the goal and then assemble the perfect team to achieve the goal.

Note: This was also posted on noprocess.org.


References


1. Ismael Ghalimi (2009), Introducing the Business Operating Platform, IT|Redux↑
2. Business is not a programming challenge @ PEG↑
3. Keith D. Swenson (2010), Mastering the Unpredictable, Meghan-Kiffer Press.↑

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Good advice

2011/06/22 in Business-Technology by peg | No comments

There’s a few bits of good advice that I’ve stumbled across during my time, and which I’ve sprinkled in some of my posts. I thought it might be worthwhile gathering them into one place.

On solving problems

If you don’t like the problem, then change it into one you do like.
— Dr K Pang

One of the best pieces of advice I picked up was from Dr. K. K. Pang[1] at university some time ago. Dr Pang taught circuit theory, which can be quite a frustrating subject. It’s common to encounter a problem in circuit theory which you just can’t find a way into, making it seemingly impossible to solve. Dr. Pang’s brilliant, yet simple, advice was “If you don’t like the problem, then change it to one you do like.”. Just start messing with the problem, transforming bits of the circuit at random until you find a problem that you can solve.

The trick with overcoming many of the obstacles that life and work throws in front of you is to realize which problem you should be solving.

On creativity

It’s pointless to try and be original, as someone’s always done it before. Just focus on doing what you’re interested in.
—Tom Fryer

My guitar teacher of many years back, Tom Fryer[2], had a bit of sage advice. It’s pointless to try to be original, as someone will always have had the idea before you. It’s a big world with a lot of history, and there’s not that many ideas. A more productive approach is to simply plow your own furrow; focus on the problems you want to solve, steal ideas shamelessly if they seem useful, and invent what you need to fill the gaps. It doesn’t matter if what you’re doing is original or not; it’s only a question of how useful and interesting the result is.

This is something that I’ve since seen from a few well known creative folk.

It’s not where you take things from, it’s where you take them to.
—Jean-Luc Godard

Innovation (a related topic) is not a question of having a great idea, or being the best at execution. Results count: what did you do with the opportunity to had?

On being the best

You’ll end up disappointed if you worry about being the best at what you do. It’s a big world and you’ll eventually run into someone has more skill. It’s more important to be happy with what you’ve done.
—Tom Fryer

Another from Tom; he’s a very wise man. No matter how much you practice, some day, probably in an armpit bar in the backwoods, there’ll be someone who blows you away as they have more skills than you. Winning awards or contests doesn’t mean you’re the best; it just means that you’re the most successful competitor at the time. (Or just the most popular, as many contests are actually fashion contests.) Some folk don’t choose to compete.

This ties back to John Kay’s concept of obliquity[3]: the idea that your goals are often best approached obliquely. The most effective path up the hill is usually to weave our way up the slope, rather than directly attack the steepest path.

I call this paradox the principle of obliquity. It says that some objectives are best pursued indirectly. I owe the phrase to Sir James Black, the chemist, whose career illustrates the principle in action. Black made more money for British companies than anyone else in the history of British business, by inventing beta-blockers and anti-ulcerants. The first he discovered in the laboratories of ICI, the second in those of Smith Kline French after he had decided that ICI was more interested in profits than in chemistry. To quote Black ‘I used to tell my colleagues (at ICI) that if they were after profits there were easier routes than drug research. How wrong could one be?’ The attempt to pursue profit too earnestly is pharmaceutical research defeated its own objectives.
—John Kay

The path to sustained success is not to set some imaginary hurdle to jump over – being the biggest or best – but to focus on doing what it is you want to do. IBM – helping business make use of technology – has been successful for over one hundred years. Microsoft – the biggest application developer on the planet – is struggling after a few decades[4].

Apple’s journey over the last decade or so seems to bear this out.

We just want to make products that we’d love to own.
—Steve Jobs

On being somebody

“Tiger, one day you will come to a fork in the road,” he said. “And you’re going to have to make a decision about which direction you want to go.” He raised his hand and pointed. “If you go that way you can be somebody. You will have to make compromises and you will have to turn your back on your friends. But you will be a member of the club and you will get promoted and you will get good assignments.”

Then Boyd raised his other hand and pointed another direction. “Or you can go that way and you can do something – something for your country and for your Air Force and for yourself. If you decide you want to do something, you may not get promoted and you may not get the good assignments and you certainly will not be a favorite of your superiors. But you won’t have to compromise yourself. You will be true to your friends and to yourself. And your work might make a difference.”

He paused and stared into the officer’s eyes and heart. “To be somebody or to do something.” In life there is often a roll call. That’s when you will have to make a decision. To be or to do. Which way will you go?”

—John Boyd from Boyd: The fighter pilot who changed the art of war[5]

It’s a big choice, but one the career councillors at school seem to gloss over. You can either choose to be someone, to fulfil a specific role such as CEO or rock star, or to do something, such as feed the poor. If you’re lucky, doing something will also allow you to be someone (such as Mother Teresa), but it doesn’t work the other way around.


References


1. Dr Pang unfortunately passed away in March 2009.↑
2. Greasy Boundaries by the Tom Fryer Quartet at Bar 303 Northcote, Melbourne Australia.↑
3. John Kay (Jan 2004), Obliquity, The Financial Times↑
4. The Economist (2011), Middle-aged blues: The software giant is grappling with a mid-life crisis↑
5. Robert Coram (2002), Boyd: The fighter pilot who changed the art of war, Back Bay Books↑

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