The importance of simple questions in assessing technology

A week or so back I watched You've Got Mail with eldest daughter. Released in 1998, the film centres on a couple who meet via email unaware that they are clashing in real life. 

Kathleen Kelly (Meg Ryan) runs a small independent bookstore, while Joe Fox (Tom Hanks) is a member of the Fox family that runs a chain of mega book stores and is planning to open a store near Kathleen's. It's quite fun, but what struck me re-watching was just how quickly business models date under the impact of technology.

In 1998, the big issue was the survival of the independent book stores in the face of the mega chains. Thirteen years later Borders collapsed under the impact of the internet. The online challenge is especially pronounced in publishing and book selling, but it is affecting all aspects of retailing. 

Here in Australia, the Sydney Morning Herald reported today on a new survey suggesting that internet spending in this country would exceed $A37 billion by 2013. A week back in the continuing patent wars between Samsung and Apple, a Federal Court preliminary injunction that prohibited the sale of Samsung's Galaxy Tab 10.1 in Australia saw a surge of Galaxy sales as Australian customers used the internet to buy in other jurisdictions.

In quite a bit of my writing I have tried to warn about the excessive hype attached to new technology. For every business that has succeeded in a big way, there are many more that have failed.

Further, many firms outside the new technology areas themselves have done considerable damage to their businesses through the misapplication of new technology. Costs may have been cut, but at the expense of customers and customer loyalty. The Australian banks that cut their branch networks to save money had then to invest heavily in rebuilding those same branch networks.

One of the key points in considering the application of new technology is that initial impacts are generally less than expected, the longer term effects greater than expected. Computing and communications technologies do create businesses on the supply side, but it is the enabling effects of those technologies that have the greatest long term impacts.

Borders collapsed in part because its customers were enabled to buy books in new ways independent of bricks and mortar and specific store visits. In Australia, Borders survives as a pale online shadow of its former glory.     

I am not sure that analysis of new technology needs to be all that complex in a general sense, although specific applications may be very complex. The single most important questions are actually quite simple:

• who will benefit from the new technology and how?
• who might lose from the new technology and how?

Take the Australian bank case.

The banks were expected to benefit from bank closures because it would reduce costs. The losers were customers who lost access to the closed branches. In certain cases, transactions and transfers, customers did benefit from greater personal flexibility. In other cases, customers simply drifted away from the bank. The banks ended by losing because they weakened their single greatest asset, direct contact with a previously loyal customer base.

The business cases put forward within the major banks to justify their actions centred on the expected gains to the banks. "Hard" number could be attached to the proposals. The "softer" questions about customer reaction in the longer term were not addressed.      

Postscript

On the Samsung/Apple issue, see Asher Moses' $30m tablet black hole: Harvey Norman hits out at Samsung ban. Apple blocks Samsung, consumers but elsewhere, Australian retailers suffer!

Postscript 2

Just recording two things:

• Group buying at consumer level
• Belshaw's World - caught between a tweet and a print place, a post of mine on newspapers & online. Recording this because I want use in in context of discussion of business models in an online world.
• Peter Dinham on cloud computing
   

Research in a total connect world?

I really wanted to record this one for later use.

I have now been involved at one way or another in the application of new technology for many decades. Now Orange has released a new research paper, What's left to Know, dealing with the impact of very large data sets. The report is subtitled research in a total connect world.

In writing the last sentence I almost made a major error. I wrote a total disconnect world instead of a total connect world. That was arguably a Freudian slip because it captured my reservations about some of the new approaches.

As I write, the Vice Chancellor of the University of New England (Professor James Barber) is continuing his campaign in favour of online learning. I quote: 

ONLINE education is revolutionising the way information is accessed to the point of redefining the roles of academic staff and casualising their employment - a trend of significant consequence to Armidale.

With the University of New England seeking to source internationally-based staff to direct its students over the internet, concerns of employment security in a casualised academic work environment have arisen on the Armidale campus.

UNE Vice-Chancellor, James Barber, would not rule out an increased casualisation of academic staff in Armidale, but wished to challenge the notion that permanent, full-time tenure was the only good mode of employment.

As I have argued in other posts, I have major reservations about the hype now attached to social media and the new communications technologies. I just don't believe the arguments. So far I have only scanned the Orange report, but it appears to contain some interesting material. I am interested as to how it might affect my present thinking.

How do we manage on-line technology?

Today I just wanted to look briefly at some changes in the internet and communications world.

Quite a bit of my time this year has been spent on ways of making on-line more effective from a work process and training perspective. I summarised some of my conclusions in one of my weekly columns in the Armidale Express, Belshaw's World - the online myth.

I mention this because Australia's IT Wire has reported on a study commissioned by Ericsson across 33 OECD economies, including Australia, that found that a doubling of broadband speed produced a 0.3 percent increase in the GDP of that economy - $A3.9b in the case of Australia. I don't actually doubt the results, they are what I would have expected, but they did remind me of the difference between the general and the particular.

There is no doubt that the new communications technologies and most recently the internet have been a tremendous aid to productivity improvement. They have also created entire new business sectors. And yet there have been real downsides.

To my mind, the most important ones fall into three classes:

• business activities have been damaged or even destroyed that are still of value to many
• business processes that should have been changed have survived because automation allows them to be carried out at a lower cost. Worse, the investment in the automation then makes them hard to change
• the new technology has facilitated a variety of controls and regulation at organisation and government level that greatly adds to overhead costs.

The message that I am trying to get across in a lot of my current writing is that we have yet to develop the best model for operating in the new environment. I have also tried to argue that if we don't do this, the incremental costs and problems associated with the new communications and computing technologies may ultimately impose risks and costs that will bring the whole system down.

This is quite hard to argue because it actually requires the adoption of a new and questioning mind set.

Take as a simple example, the way in which many firms are now trying to control or even limit email. Email is just so easy, is now so deeply embedded, that effective management is quite hard.

In some ways, on-line is like a drug, a quick hit with later problems.

I am not arguing that the technology should not be used. I am arguing that it should be managed.  

Problems with technologists

The Internet is important to all of because of the way if affects our profession and business. For that reason, I have written a fair bit about it over time.

On Friday 22 July I wrote Academic journals, the shuttle & the internet on my personal blog. It's there because it was triggered by my personal reactions. I said in part:

I am a very heavy internet use. Further, the way I use the net extends well beyond transactions or the discovery of immediate current information. To the ordinary user, the problems that I experience may be of limited relevance. Yet I think that they are quite important.

My thinking to this point has really focused on my own responses, essentially taking the net as a given. I am now wondering just how the net has to change if it is really to meet the needs of that minority group, Belshaw and his ilk.

A lot of the technologists and net enthusiasts I know are not much help. I have been meaning to write on this one for a while. The difficulty from my perspective is that I am expected to fit into their solutions and enthusiasms, whereas I want them to fit into mine! I am, after all, the user!

In Australia, the main law publishing firms are all in the process of releasing their publications as e-books. However, they are also trying to maintain their current charge structures. It's not going to work - the simple addition of a search facility is not enough to justify the cash cost.

When I said in my post that I wanted the technologists to fit into my solutions and enthusiasms I wasn't joking. The problem with technologists is that they won't do this and it's frustrating.

Technology is a means to an end, not an end in itself.

Recently I have been working on some internet based projects designed to streamline aspects of professional practice. I think that the thing that stands out most clearly in my mind is just how hard it is to get the interface right between the technology and the business or professional process.

One of the kickers is the hidden cost that lies in simple things like support and training.

I think that there are solutions, but they are going to come from the business, not technology side.     

Proposed NSW data centres strike trouble

I see from IT Wire that the NSW Government's proposal to build two mega data centres in Sydney and Wollongong to replace existing centres has struck yet more trouble. IT Wire uses the word "farce"; that's not unreasonable.

Just at the moment I'm working on an assignment that has a connection with cloud computing. The NSW problems do raise the question as to whether thus type of mega centralised solution is still appropriate.  

Overcoming chaos in the home office

For much of the last few years, I have largely worked from a home office. Then I moved to on-site work.

My home office was always a bit chaotic. Things deteriorated rapidly after I moved to on-site work, not helped by the habit of my family of dumping things in my space for me to get rid of!

For reasons I won't bore you with, the need to find past papers has suddenly made tidying up a matter of urgency. So I have been going through the piles. In doing so, I suddenly realised that my presence in the on-line world has actually changed the way I work. More precisely, the way I should work.

I have my computer with its electronic files. Then there are my various blogs, web sites and social networking sites.

I tend to keep paper records because they are easier to read, while I have also been worried by things such as computer collapses as well as software changes. The quantity of electronic material that I can no longer access is quite astonishing! So paper records have been of great value.

No more. There are still some things that need to be kept in paper form, but now I have a wide range of storage options, as well as a content creation and modification process. Let me illustrate what I mean.

In my personal as opposed to professional space, I am an historian and economist. I write a fair bit of historical stuff that I would like other people to read. However, I struggle to find the time to write proper journal articles.

I know from experience just how ephemeral records can be. There is no certain way of ensuring that material is preserved. However, with an effective content creation process, you can improve both access (this is important in a professional sense) and the chances of your writing surviving.

The starting point is my blogs. I use these to explore and record ideas. In survival terms, I am dependent here on Google. If Google were to go down, this material would be lost. But in the meantime, blogging is a good way to develop ideas for later access and re-use.

Some of this material I transfer to my existing web sites. Here I can make longer material available in differing forms. As part of this, I have access to a password protected intranet that I can access from anywhere in the world. So I can post work in progress in various forms for later use.

This the most vulnerable point in the whole process in that survival depends upon the survival of the site provider on one side, my ability to keep payments up on the other.

To overcome this, I have begun to use Wikipedia to put up historical material, thus ensuring broader access. I have also just started to turn some of my material into forms suitable for book publication.

Linking all this back to my home office point. I simply don't need to keep a lot of the stuff I used too because my whole process has changed.

FICPI Australia Annual Conference 2008

In my last post on Corporatisation, Keddies and professional ethics I mentioned a conference paper I was delivering later this month.

Stephen Krouzecky (Hodgkinson McInnes Patents) invited me to be one of the key note speakers at the Australian Federation of Intellectual Property Attorneys (FICPI) 2008 Conference to be held on Magnetic Island from 25 to 28 July.

Australian legislation is to be changed to allow patents and trade marks firms to incorporate, perhaps the last professional services sector to be so affected. For that reason, FICPI has decided to focus this year's conference on issues raised by the corporatisation of patent attorney firms. I am to be the key note speaker at the session on the management and operational issues raised by the adoption of corporate approaches.

Stephen invited me to present because of the posts I had written on corporatisation within professional services. This reinforces a point I have made a number of times, the way in which an on-line presence can be used to reinforce professional standing.