EclecticLip

A story caught my eye on July 7, about how IBM has a microchip assembly and testing facility — in Quebec.  (That’s high-cost-of-labour-environment Quebec — not low-cost-of-labour-environment China.)

The reason it’s able to do so, is because of the relentless kaizen (continuous improvement) practised there: they’re able to compete in what should be a largely outsourceable industry, through innovation.  Kaizen was one of the underpinnings of earlier book club selection, The Toyota Way.
 
While innovation won’t insulate you fully from arbitrage of labour prices, I think this example shows that (innovative, high-cost labour) can compete better than most people think, against (non-innovative, low-cost labour) and especially (non-innovative, high-cost labour).  Some excerpts from the article include:

The factory, 75 kilometres east of Montreal, started out in 1972 making Selectric typewriters. It has worked its way up to become IBM’s biggest facility for testing and assembling advanced microchips. Its products go into the planet’s most popular video-game consoles and fastest supercomputers…

“We don’t compete on labour rates, we compete on skill, on innovation, on time to market,” said Mr. Leduc, a veteran from the typewriter days, who was appointed last year to be a part-time adviser to Canada’s National Research Council…

While Canada’s productivity has crept ahead by only about 0.7 per cent a year during the past decade, managers at Bromont say their ability to harness the creativity of their work force has allowed some units to boost productivity by an impressive 10 per cent or more a year… 

“One of the greatest competitive edges a company can give themselves, especially these days, is getting each staff member to see their role in contributing to positive change,” Mr. Reid said. “There’s a massive difference between just doing the job and being a high-performance culture.”

Note: that emphasis there was my editorial contribution. 

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I suspect there’s a valid analogy to be made in the economic sphere.  An economy stocked with a million entrepreneurs, each trying to improve their business’s success, is probably going to do better over time than one where a small group decides what’s to be done and how.  That’s the basic difference between a market economy and a command economy (”central planning” is a case where the aforementioned small group is the government). 

The Koreas provide a great example.  As chronicled in Ha-Joon Chang’s Bad Samaritans, back in the day North Korea was richer; it was the industrial area.  South Korea exported seaweed.  Over a few decades, the South Korean government used a market economy to become unimaginably richer than its northern rival.  (Note: like virtually every other industrialized country, its government supported target industries — a practise known as indirect planning — but it let the homegrown competitors fight it out in the marketplace.)

Pulling back from global economics to the corporate level, I’d bet that — just as South Korea ultimately surpassed North Korea, despite its initial disadvantage — companies where ideas for improvement bubble up from all levels, will tend to enjoy more success, longer, than their “everybody just doing the job” counterparts.

Which sort of goes to the root of the book club.  I see it as a way I can suggest improvements, to help myself and others be that little bit more effective; speaking only for myself, I’ve got a lot of “just doing the job” years to make up for.

I recently had a chance to catch up on some podcasts.  (Much like my “not-yet-read books” bookshelf, I’ve got many a megabite of unheard podcasts on my hard drive.)  This one was a CBC Ideas episode called The Moral of the Story Is; it’s dated March 22 2010.  It starts off with Bertrand Russell’s remark that:

“Most of the greatest evil that man has inflicted upon man comes throuhg people feeling quite certain about something which, in fact, was false.”

Partway through, the narrator interviews one Dr. Robert Burton, a neurologist at Mount Zion University of California Hospital.  At about the twenty-minute mark, he suggests that the brain’s reward system activates, when one has the sense of being right — in the same way it activates when people smoke, drink, use drugs, or engage in other addictive behaviours.  Basically, feeling indignant gives you an upswell of (bio)chemical pleasure.

At about 22 minutes, there’s a wonderful exchange:

Narrator: are you suggesting Bill O’Reilly is some sort of junkie, in a way?

Burton:  I’m not suggesting.

This rings true for me.  I’ve experienced the intoxicating sense of indignant righteousness when arguing with people who were “clearly wrong”.  Nowadays, I try to maintain an unrippled calm; and temper any anger with humour.  My media habits reflect this: I used to enjoy listening to American progressive talk radio, but now tend to find it agitating, again on account of the subsurface exasperation.  Of course, that’s nothing compared to what relatively little I’ve experienced of its conservative cousin.  I prefer The Daily Show, Colbert Report and Bill Maher, as their jeremiads are leavened with humour.  Our modern jesters, I suppose.

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While Dawkins maintains his composure here, he carries a lot of anger — indignation — towards the shallower strands of various religion traditions.  If memory serves, he gives Buddhism a pass in The God Delusion; his real problem is with literalism in the Abrahamic faiths, and Christian fundamentalism in particular.  Brutish and backwards as they may be, they’re not worth tripping into addictive indignation over.  Surely other approaches are better.

Recently finished Daemon and Freedom, Daniel Suarez’ two-part semi-dystopic vision of the future.  I say semi-dystopic because they weren’t all bad news.  Loved them both, for the fact that they informed of the capabilities of computational power today — in a seamless manner that didn’t slow the action of the story.  In this feat, they reminded me of Gore Vidal’s Creation, the master’s bracing tale spanning pretty much the entirety of 5th-century-BC Eurasia.  Which, come to think of it, might be deserving of a re-read, about now…

On the surface, Daemon is a story in the “machine turns on its creator” genre.  Like “2001″.  And “Frankenstein”.  And for that matter, the Bible.    Freedom builds on this to reveal a clash between two competing visions for the future.

More profoundly, the dyad explores how our social/societal structures may change in the coming decades, based on the interplay of our current crises and the capacities of new technology.  All wrapped up in a masterful storyline.  With fiction like that, who needs textbooks? 

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note: Suarez has also given a lecture at the Long Now Foundation, well worth the invested time.  It’s available here.  Most intriguing to me was the idea that in a short time, bots will begin to outnumber humans online.  We won’t be the dominant “species”. 

It seems somehow analogous to the apparent fact that mutual funds outnumber stocks, in the investment sector: the derivative species (bots, mutual funds) ultimately flourishing more than the original species it interacts with (humans, stocks).

I was recently told that two local behemoths — BC Hydro and Best Buy — brought consulting firm Accenture in, to run their IT groups.  The idea is that Accenture’s expertise will enable them to provide the IT function cheaper than the two aforementioned behemoths would be able to, even with a profit margin.

This immediately made me think of mitochondria, the “engines” of living cells.  The thinking is that a couple billion years ago, advantages accrued to cells which had assimilated / “swallowed” mitochondria: the latter were very efficient at generating ATP, a chemical used by the cells for energy.

In the corporate analogue, BC Hydro and Best Buy would be the host cells, and Accenture (or other outsourced IT service providers like IBM) would be the mitochondria.  The key measure is whether the aforementioned firms do indeed enjoy advantages through this activity — or whether they decide to return to the DIY path, down the road…

Innumerable sources talk about how peer recognition matters for more people than money… though the latter itself has some importance too.   

I imagine that at most companies, pay is assigned at approximately market levels based on the responsibilities incurred.  As such, CEO pay tends to drift higher than junior engineer pay, because the market has been assigning a higher value to the former — despite the many examples where this has proven incorrect. 

For their part, markets are mechanisms for establishing the price of a good through transactions, based on perceived value of the participants.  If not enough buyers feel a banana is worth $3, they will tend not to buy until the price drifts to levels they’re willing to pay; if not enough sellers feel a banana is being properly valued at 3 cents, they will tend divert their productive elsewhere, until the price rises. 

If we call the grouping of people in a market “peers” we could easily say market prices are a peer phenomenon — a peer assessment of value of the service / good in question, such as a year’s worth of junior engineering time.  Market prices are a form of peer recognition-of-value, or to be more precise, peer perception-of-value.  Presumably , if Ahab makes more money than Baal, that means he’s perceived to be more valuable.

In which case pay serves as a proxy for peer recognition (how you’re recognized among your peers, and/or by your peers, depending how hierarchical one’s firm is).  Which would go a long way towards explaining why it can be such a sensitive subject…

Like many Canadians, I regard the current Conservative government with a suspicious distrust; enough that after the 2008 election, I began donating money to the Liberal Party of Canada.  While my thinking leans leftwards of theirs, they remain the most viable less-conservative alternative in the near term — hence my “remittances of convenience”, to borrow from the marital phrase.

But the Liberals are stuck in a catastrophic polling funk – and their misery is continuing in respiteless fashion.  Furthermore, on a variety of issues, Liberal Party leader Michael Ignatieff seems about as conservative as Stephen Harper.  Born into the elite, Ignatieff doesn’t seem to connect with voters.  In contrast, the Prime Minister, hardly a man of charisma himself, seems to manage adequately, despite also being born into privilege (his dad became an oil executive).

As such, I wonder whether Michael Ignatieff is the John Kerry to Stephen Harper’s George W. Bush — a challenger indistinct enough from the incumbent, without the rapport / messaging advantage to pull out a victory.

Time will tell. 

A colleague told me recently that FORTRAN still finds strong use in academia — outside of computer sciences, that is.  (I can only attest that FORTRAN was being used by chemical engineering professors in the late 1990’s at UBC.)

Evidently, FORTRAN was the language that computer-savvy professors in the 1960’s and 1970’s used for their work.  In the 1980’s and 1990’s, enough young professors building on their predecessors’ work, found it easiest to continue using FORTRAN.  With the result that FORTRAN still finds considerable use in academic circles.  Or, so says my anonymous source with the unverified information. 

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If true, there would be strong parallels with Latin and Sanskrit.  (Technically the closest parallel might be Proto-Indo-European, but franky, “FORTRAN - the Proto-Indo-European of computer languages” sounds ridiculous.)

Latin and Sanskrit were languages that survived in academic / “elite” circles, long after they had been supplanted by a myriad of vernacular languages in everyday use.  And outside academia, FORTRAN must have the programming-language-equivalent market share of, like, the Opera browser.  Or Netscape Navigator (I remember when you were cool!).  See Wiki here.

We recently covered Jim Collins’ book Good to Great, in our business book club.

The tome is responsible for popularizing the hedgehog metaphor, namely that a company should stick to what it’s best at, and not diversify into other sectors where it has no competitive advantage.  (I’ve heard of this kind of diversification being jeered as “deworsification” by irritated investors.    )

I’d heard that the fox / hedgehog contrast originated from Aesop’s fables…  but when I double-checked, it turns out that Aesop’s fox/hedgehog story was a parable about how when the proletariat overthrow the bourgeoisie, it just leaves a power vacuum for a new and even-more-rapacious aristocracy to move in.  Or at least, that’s how Marxists would put it. 

Turns out the fox-and-hedgehog comparison comes from an even more obscure Greek guy, Archilochus, who said: “the fox knows many things, but the hedgehog knows one big thing”.  That’s about the only thing of his that’s survived.  Who knows — but for selective scribes, equally pithy aphorisms about, say, the hippo and the oxpecker, or the cat and the giraffe, might have inspired future business books!  (Hippos and oxpeckers are symbiotic species, while I chose cats and giraffes arbitrarily.)

Now, the real test as to whether the fox-and-hedgehog parable holds true, is whether there are more foxes in the world, or hedgehogs.  Sadly, I couldn’t find any population numbers in a quick online scan.  Though given how dumb hedgehogs are reputed to be, I’d sort of imagine foxes would be more genetically successful… which would contradict the saying. 

(Mind you, foxes are near-top-of-food-pyramid predators, and there are generally far fewer such predators than any prey species.)

(originally written March 17.  Posted March 28) 

The recent issue of TIME magazine included a scribbling by someone named Reihan Salam.  His article “The Dropout Economy” is somewhat sensationalistic and largely unnoteworthy, except for the fact that it directly references the writings of a guy named John Robb, whose ideas on “resilient communities” were footnoted in the article I co-wrote for McKinsey last year, on the future of energy.

Which means that my company’s thought leadership is a full year ahead of the curve of TIME magazine’s ever-shrinking readership.  And based on a quick search of The Economist’s website, they haven’t even heard of the term. 

Robb — a former US Air Force guy who helped mainstream RSS feeds — posits that due to a confluence of factors (financial, demographic, technological) the nation-state is going to be under tremendous pressure in the coming decades.  As a result, communities will reorient themselves to resiliency as opposed to efficiency.  (His blog is here.)

This might be best understood through analogies:

- Redmond’s Technosaurus Rex beat out its corporate competition in the PC era.  But its dominance has eroded in the face of competition from decentralized, ad hoc open-source code.  (Linux, Firefox, OpenOffice and others)

- humans are the dominant animals: with our tools, we can overcome any creature we run into in sky, street or sea.  But we don’t look so kingly compared to bacteria: they can develop immunity to our antibiotics faster than we can invent new ones

- the US is the world’s hyperpower: it can overwhelm all its rival nation-states.  But like all countries, it’s struggling to deal with threats from terrorist cells, which can be small enough to “fly under the radar” of the traditional defense mechanisms (police, armed forces)

In the past half-century at least, there’s been a strong advantage for communities and countries to be organized on the basis of efficiency, at the expense of resiliency.  As such, our world is one of faraway power plants and overseas supply chains.  Like Robb, I think the pendulum is swinging (for at least a couple decades) towards resiliency; it will be seen as advantageous enough, even if it seems more expensive than efficiency.  And *that* creates the kind of opening that fuel cells and other on-site power generation technologies can richly exploit. :)

I’ve been using the ideas from David Allen’s Getting Things Done at work for about a year now, and despite my undeniable novicedom, have found it invaluable: I feel like a Stone Age artisan newly introduced to bronze!

Like so many transformative tools, the basics are delightfully simple — but like eastern martial-arts disciplines with which it shares… well, virtually nothing, the arresting simplicity takes years to master. 

Actually, I jest — the end-goal of GTD, as it’s known to its acolytes, is to allow the practitioner to engage in their life and work attentively, undistracted by other action-items and to-do’s that might otherwise clutter the mind.  Which means it’s basically the Zen ideal of mushin, or “no-mind”, dressed up in 21st-century American secular idiom.  And mushin plays a central role in every eastern martial-arts discipline I’ve chanced to read up on.  So GTD does in fact share a common fundament with karate, judo, aikido, and their cousins.
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For me, the biggest GTD learnings have been:

• discovering the exhiliaration of the empty inbox!
• the idea of separating items on my to-do lists based on timeframe (my prior attempts to make to-do lists failed because my short- and long-term items were jumbled together)

Most gratifyingly, the “outsourcing” of my memory to Outlook has let me clear my mental cache of those things-to-remember that always floated around in the back of my mind, depleting my concentration.  So now, instead of multitasking, I can monotask.  That is, I can direct 100% of my focus to various tasks-at-hand, instead of only offering 90% (because the other 10% needed to be held back to avoid forgetting other action items).

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With my quantum leap in workplace productivity, it was a rashworthy irritation that I couldn’t apply similar methods at home with Gmail, given its more limited architecture.

So discovering GTDInbox a few days ago was a real psychological emollient.    A Firefox extension, it layers a GTD-friendly interface onto the Gmail interface.
Within a few hours, I’d decluttered my Gmail Inbox from about 170 to under 50 items — one screen.  And there’ll be a few whoops (as in plural-of-the-celebratory-whoop, not as in gentle-expletive-indicating-accident) of joy in the living room when I attain the mythical state of “Inbox Zero“.