business process

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The Data Warehouse Toolkit: The Definitive Guide to Dimensional Modeling by Ralph Kimball, Margy Ross

active measures, Albert Einstein, business intelligence, business process, call centre, cloud computing, data acquisition, discrete time, inventory management, iterative process, job automation, knowledge worker, performance metric, platform as a service, side project, zero-sum game

Chapter 3 discusses the following concepts: Four-step process for designing dimensional models Fact table granularity Transaction fact tables Additive, non-additive, and derived facts Dimension attributes, including indicators, numeric descriptors, and multiple hierarchies Calendar date dimensions, plus time-of-day Causal dimensions, such as promotion Degenerate dimensions, such as the transaction receipt number Nulls in a dimensional model Extensibility of dimension models Factless fact tables Surrogate, natural, and durable keys Snowflaked dimension attributes Centipede fact tables with “too many dimensions” Four-Step Dimensional Design Process Throughout this book, we will approach the design of a dimensional model by consistently considering four steps, as the following sections discuss in more detail. Step 1: Select the Business Process A business process is a low-level activity performed by an organization, such as taking orders, invoicing, receiving payments, handling service calls, registering students, performing a medical procedure, or processing claims. To identify your organization's business processes, it's helpful to understand several common characteristics: Business processes are frequently expressed as action verbs because they represent activities that the business performs. The companion dimensions describe descriptive context associated with each business process event. Business processes are typically supported by an operational system, such as the billing or purchasing system. Business processes generate or capture key performance metrics. Sometimes the metrics are a direct result of the business process; the measurements are derivations at other times.

The performance measurements users want to analyze in the DW/BI system result from business process events. Sometimes business users talk about strategic business initiatives instead of business processes. These initiatives are typically broad enterprise plans championed by executive leadership to deliver competitive advantage. In order to tie a business initiative to a business process representing a project-sized unit of work for the DW/BI team, you need to decompose the business initiative into the underlying processes. This means digging a bit deeper to understand the data and operational systems that support the initiative's analytic requirements. It's also worth noting what a business process is not. Organizational business departments or functions do not equate to business processes. By focusing on processes, rather than on functional departments, consistent information is delivered more economically throughout the organization.

You should think dimensionally at other critical junctures of a DW/BI project. When gathering requirements for a DW/BI initiative, you need to listen for and then synthesize the findings around business processes. Sometimes teams get lulled into focusing on a set of required reports or dashboard gauges. Instead you should constantly ask yourself about the business process measurement events producing the report or dashboard metrics. When specifying the project's scope, you must stand firm to focus on a single business process per project and not sign up to deploy a dashboard that covers a handful of them in a single iteration. Although it's critical that the DW/BI team concentrates on business processes, it's equally important to get IT and business management on the same wavelength. Due to historical IT funding policies, the business may be more familiar with departmental data deployments.


pages: 523 words: 61,179

Human + Machine: Reimagining Work in the Age of AI by Paul R. Daugherty, H. James Wilson

3D printing, AI winter, algorithmic trading, Amazon Mechanical Turk, augmented reality, autonomous vehicles, blockchain, business process, call centre, carbon footprint, cloud computing, computer vision, correlation does not imply causation, crowdsourcing, digital twin, disintermediation, Douglas Hofstadter, en.wikipedia.org, Erik Brynjolfsson, friendly AI, future of work, industrial robot, Internet of things, inventory management, iterative process, Jeff Bezos, job automation, job satisfaction, knowledge worker, Lyft, natural language processing, personalized medicine, precision agriculture, Ray Kurzweil, recommendation engine, RFID, ride hailing / ride sharing, risk tolerance, Rodney Brooks, Second Machine Age, self-driving car, sensor fusion, sentiment analysis, Shoshana Zuboff, Silicon Valley, software as a service, speech recognition, telepresence, telepresence robot, text mining, the scientific method, uber lyft

The missing middle concept undergirds our thinking about how humans and machines work best together in the age of AI; it’s critical to reimagining business processes. But the big question remains: What are the actual steps for reimagining business processes? How should managers proceed? Based on our observations of companies at the forefront of implementing advanced AI technologies, we have uncovered five key management practices. While we are still in the early days of AI-driven business transformation, we believe these practices provide a path forward. The five practices are each components of the MELDS framework described in the introduction. We’ll focus on the first four here: Executives must adopt the proper mindset, with a focus on not just improving business processes but rather on completely reimagining business processes and the way that work is performed. They need to foster a culture of AI experimentation that allows them to quickly realize how and where the technology can change a process, and where it makes sense to increase the scale and scope of a process.

Now, to continue exploiting the full potential of AI technologies, many leading companies have begun to embrace a new view of business processes as more fluid and adaptive. In essence, they are moving beyond rigid assembly lines toward the idea of organic teams that partner humans with advanced AI systems. This collaboration between workers and smart machines is leading to the reinvention of many traditional processes. As BMW and Mercedes-Benz have experienced, rigid assembly lines are giving way to flexible teams of employees working closely alongside robots. Moreover, these novel types of teams can continuously adapt on the fly to new data and market conditions. They are enabling companies to actually reimagine various work processes. The Third Wave The key to understanding AI’s current and future impact is its transformation of business processes. A widespread misconception is that AI systems, including advanced robotics and digital bots, will gradually replace humans in one industry after another.

Specifically, they initially should focus on developing the full potential of their employees by applying automation to routine work; then they can proceed to concentrate on human-machine collaborations. Experimentation: actively observing for spots in processes to test AI and to learn and scale a reimagined process from the perspective of the missing middle. The age of standard business processes is coming to an end, and companies will no longer be able to rely on a strategy of replicating best-in-class practices from leading firms. And this is why experimentation is crucial. Executives must continually conduct tests to derive business processes that will work best for their unique set of conditions. A large part of that effort will require trial and error to determine what work should be done by humans, and what work would best be done by a collaboration between humans and machine (the missing middle). Leadership: making a commitment to the responsible use of AI from the start.


Writing Effective Use Cases by Alistair Cockburn

business process, c2.com, create, read, update, delete, finite state, index card, information retrieval, iterative process, recommendation engine, Silicon Valley, web application

Looking back, I now can see the crux of the problem was different people on the team approaching the problem from different perspectives. I was working from business process to technology. Some other people were working from technology to the business process. Needless to say, the design scope for each use case wasn't clear between the two groups. The business-process-to-technology group never got to writing the system use cases, and the technology-to-business-process group never got to writing the business use cases. Instead, they sort of hit each other in a head-on collision, with each group trying to coerce the others as being their business/or system use case. Not having the insight or the necessary understanding at the time to label the use cases correctly for scope and level, the use case model became quite a mess. In the end, the team was never really happy 158 Chapter 15. Business Process Modeling Page 159 - Parameterized use cases with the use case model, they knew it didn't "smell" right, but didn't know what exactly was wrong.

The system use cases will be the requirements used for the system design. See Figure 22.. 155 Chapter 15. Business Process Modeling Parameterized use cases - Page 156 Figure 22. New business process in black-box system use cases. MyStore Sales Customer Accounting While this looks quite Clerk wonderful on paper, it costs a lot Delivery Supplier New of money and is time Software Stocking & consuming. Technology moves Delivery so fast and creates such a pressure that often there is no time to work this way. I have several times found that usage experts, people in the business who are experts in their working areas, can do the new business process modeling in their heads, allowing you to save time and money. You would then work in the third way... Work from technology to business process. First, collect some experienced usage experts, people in the business who are experts in their working areas, who probably have been eager to improve their groups’ technology and work habits for some time.

As part of writing the system use cases, they will, of course, write a few summary level and business use cases showing context, and the linkage of goals over time. In other words, a light business process documentation will be generated as a normal part of the system requirements exercise. The usage experts will have done the new process modeling in their heads, while arguing about how the actors and new system should behave under various circumstances. I have found this to be quite an effective way of working. * 156 Use Case 3:“Register arrival of a box” on page 19 illustrates how documenting the system behavior can end up describing a fragment of the business process, complete with exceptional conditions. Chapter 15. Business Process Modeling Page 157 - Parameterized use cases * Use Case 21:“Handle a Claim (systems)” on page 80 is a summary (kite-level) use case that shows the business process context for the system. Linking business- and system use cases A business use case has the same appearance as a system use cases, so all the training in writing and reviewing use cases can be applied to both business use cases and system use cases.


pages: 374 words: 94,508

Infonomics: How to Monetize, Manage, and Measure Information as an Asset for Competitive Advantage by Douglas B. Laney

3D printing, Affordable Care Act / Obamacare, banking crisis, blockchain, business climate, business intelligence, business process, call centre, chief data officer, Claude Shannon: information theory, commoditize, conceptual framework, crowdsourcing, dark matter, data acquisition, digital twin, discounted cash flows, disintermediation, diversification, en.wikipedia.org, endowment effect, Erik Brynjolfsson, full employment, informal economy, intangible asset, Internet of things, linked data, Lyft, Nash equilibrium, Network effects, new economy, obamacare, performance metric, profit motive, recommendation engine, RFID, semantic web, smart meter, Snapchat, software as a service, source of truth, supply-chain management, text mining, uber lyft, Y2K, yield curve

So with the help of analytics software from Emcien, it produced a demand-shaping pattern analysis for determining the optimal number of product configuration options, resulting in a $110 million bump in revenues and a 5 percent increase in sales efficiency.18 Optimizing Business Processes Ultimately, any form of information monetization is the result of some business process or combination of business processes. BI tools generally are standalone with respect to the business processes that they support. Even when embedded into business applications, they tend to present charts or numbers in an application window. Ideally, output is updated to reflect the user’s activity and needs, but less often is it used to affect the business process directly. Evolving to complex-event processing solutions, recommendation engines, rule-based systems, or artificial intelligence (AI), combined with business process management and workflow systems, can help to optimize business processes more directly, either supplementing or supplanting human intervention.

Typical BI solutions where analytic output is directed at people not processes can falter as the speed of data inputs ratchets up. Increased information velocity implies an increased speed of business. At even low levels of velocity, humans become incapable of ingesting and using information efficiently, at which point business process effectiveness can suffer. This is the point at which advanced analytic applications are required that consume and respond to swift streams of data (think of algorithmic stock trading.) These apps can make recommendations either to users responsible for administering an operational business process or be integrated with the business process applications themselves. Monetizing the Increased Variety of Information While many BI solutions can report on information from multiple sources on demand, or make use of integrated data in data warehouses or marts, they don’t truly take advantage of this diversity of data.

Formula The PVI is a simple ratio that calculates KPI improvement by incorporating a given information asset, extrapolated over the usable life span of any given instance of data: (Or for multiple KPIs, the overall PVI can be expressed as the mean of their individual PVIs.) Where: KPIi = Business process instances using the information asset (informed group). KPIc = Business process instances not using the information (control group). T = The average usable life span of any data instance. t = The duration over which the KPI was measured. Implementation Using the PVI model ideally requires running a controlled experiment in which certain instances of a business process incorporate a certain information asset that other instances do not. It is a classic A-B test. A positive PVI demonstrates that the data is valuable for this process; a negative PVI indicates that the additional data somehow impedes the process.


pages: 233 words: 67,596

Competing on Analytics: The New Science of Winning by Thomas H. Davenport, Jeanne G. Harris

always be closing, big data - Walmart - Pop Tarts, business intelligence, business process, call centre, commoditize, data acquisition, digital map, en.wikipedia.org, global supply chain, high net worth, if you build it, they will come, intangible asset, inventory management, iterative process, Jeff Bezos, job satisfaction, knapsack problem, late fees, linear programming, Moneyball by Michael Lewis explains big data, Netflix Prize, new economy, performance metric, personalized medicine, quantitative hedge fund, quantitative trading / quantitative finance, recommendation engine, RFID, search inside the book, shareholder value, six sigma, statistical model, supply-chain management, text mining, the scientific method, traveling salesman, yield management

At a time when companies in many industries offer similar products and use comparable technology, high-performance business processes are among the last remaining points of differentiation. Many of the previous bases for competition are no longer available. Unique geographical advantage doesn’t matter in global competition, and protective regulation is largely gone. Proprietary technologies are rapidly copied, and breakthrough innovation in products or services seems increasingly difficult to achieve. What’s left as a basis for competition is to execute your business with maximum efficiency and effectiveness, and to make the smartest business decisions possible. And analytical competitors wring every last drop of value from business processes and key decisions. Analytics can support almost any business process. Yet organizations that want to be competitive must have some attribute at which they are better than anyone else in their industry—a distinctive capability.3 This usually involves some sort of business process or some type of decision.

In the next two chapters, we’ll explore in more detail how certain companies are using analytics to outperform the competition. Chapter 4 addresses internal processes, and chapter 5 deals with external processes, such as those involving customers and suppliers. 4 COMPETING ON ANALYTICS WITH INTERNAL PROCESSES Financial, Manufacturing, R&D, and Human Resource Applications ANALYTICS CAN BE APPLIED TO many business processes to gain a competitive edge. We’ve divided the world of analytical support for business processes into two categories: internal and external. The next chapter will address external applications—customer- and supplier-driven processes—and this one will focus on internal applications (refer to figure 4-1). It’s not always a perfectly clean distinction; in this chapter, for example, the internal applications sometimes involve external data and entities, even though they are not primarily about supply and demand, customers, or supply chains.

What Rules and Processes Are Needed to Manage the Data from Its Acquisition Through Its Retirement? Each stage of the data management life cycle presents distinctive technical and management challenges that can have a significant impact on an organization’s ability to compete on analytics.9 Data acquisition. Creating or acquiring data is the first step. For internal information, IT managers should work closely with business process leaders. The goals include determining what data is needed and how to best integrate IT systems with business processes to capture good data at the source. Data cleansing. Detecting and removing data that is out of date, incorrect, incomplete, or redundant is one of the most important, costly, and time-consuming activities in any business intelligence technology initiative. We estimate that between 25 percent and 30 percent of a BI initiative typically goes toward initial data cleansing.


Service Design Patterns: Fundamental Design Solutions for SOAP/WSDL and RESTful Web Services by Robert Daigneau

Amazon Web Services, business intelligence, business process, continuous integration, create, read, update, delete, en.wikipedia.org, fault tolerance, loose coupling, MITM: man-in-the-middle, MVC pattern, pull request, RFC: Request For Comment, Ruby on Rails, software as a service, web application

Continues 131 Web Service Implementation Styles 132 C HAPTER 5 W EB S ERVICE I MPLEMENTATION S TYLES Table 5.1 Web Service Implementation Styles (continued) Design Considerations for Web Service Implementation Pattern Name Problem Description Command Invoker (149) How can web services with different APIs reuse common domain logic while enabling both synchronous and asynchronous request processing? Create command objects that fully encapsulate common request processing logic. Instantiate and invoke these commands from within the web service, or forward them to an asynchronous background process. Workflow Connector (156) How can web services be used to support complex and long-running business processes? Use a Workflow Engine to manage the life cycle and execution of tasks within complex or long-running business processes. Identify a web service that will trigger each logical business process. Use Callback Services to receive additional data for these long-running processes, and forward messages from these Callback Services to the Workflow Engine. Design Considerations for Web Service Implementation The following factors should be considered when writing web service code. • Atomicity: Web services should be atomic and adhere to an “All-or-Nothing” philosophy.

= customerId){ customer = Customer.getById(customerId); } else{ customer = Customer.initForNewAccount( request.getCustomer()); } PriceList pricing = new PriceList( request.getVehicleClass()); Money cost = pricing.getRentalCost( request.getPickupLocation(), request.getDropOffLocation(), dateRange); customer.chargeAccount(cost); RentalLocation rentalLocation = RentalLocation.getRentalLocation( request.getPickupLocation()); RentalHold rentalHold = new RentalHold( request.getRequestId(), customer, request.getVehicleClass(), pricing.getListId(), dateRange, rentalLocation); rentalHold.submit(rentalHold); session.commit(); } } Command Invoker 156 C HAPTER 5 W EB S ERVICE I MPLEMENTATION S TYLES Workflow Connector Web services are to be used by a complex business process that runs for minutes, hours, days, or weeks. How can web services be used to support complex and long-running business processes? Workflow Connector Web services are often used to launch complex business processes that run for extended periods of time. A web service may, for example, trigger tasks that reserve flights, hotels, and car rentals for a vacation package. Processes like these can take several minutes, hours, or even days to complete. A web service that contained all of the code for a process like this would undoubtedly become quite difficult to read and maintain.

This pattern also provides a relatively fault-tolerant way to conduct long-running business processes. However, it can be challenging to understand the entire business process at a macro level, and it can also be difficult to change or debug control-flow logic since these rules are typically buried within individual services, configuration W ORKFLOW C ONNECTOR files, routing tables, and messages in transit. Furthermore, the status of a client’s request can be difficult to ascertain for similar reasons. The complexity of the software infrastructures required to support a Pipes and Filters architecture should not be underestimated. Infrastructures that direct the flow of control through a strict sequence of tasks are the simplest to implement. However, most business processes aren’t that simple. The vacation booking process could, for example, be designed to run the flight, hotel, and car reservation tasks simultaneously.


pages: 133 words: 42,254

Big Data Analytics: Turning Big Data Into Big Money by Frank J. Ohlhorst

algorithmic trading, bioinformatics, business intelligence, business process, call centre, cloud computing, create, read, update, delete, data acquisition, DevOps, fault tolerance, linked data, natural language processing, Network effects, pattern recognition, performance metric, personalized medicine, RFID, sentiment analysis, six sigma, smart meter, statistical model, supply-chain management, Watson beat the top human players on Jeopardy!, web application

Examples include RFID tags, vehicles equipped with GPS sensors, low-cost remote sensing devices, instrumented business processes, and instrumented web site interactions. The question may soon arise of whether Big Data is too big, leading to a situation in which determining value may prove more difficult. This will evolve into an argument for the quality of the data over the quantity. Nevertheless, it will be almost impossible to deal with ever-growing data sources if businesses don’t prepare to deal with the management of data head-on. DATA CONTINUE TO EVOLVE Before 2010, managing data was a relatively simple chore: Online transaction processing systems supported the enterprise’s business processes, operational data stores accumulated the business transactions to support operational reporting, and enterprise data warehouses accumulated and transformed business transactions to support both operational and strategic decision making.

The use of Big Data analytics is thus becoming a key foundation for competition and growth for individual firms, and it will most likely underpin new waves of productivity, growth, and consumer surplus. THE CASE FOR BIG DATA Building an effective business case for a Big Data project involves identifying several key elements that can be tied directly to a business process and are easy to understand as well as quantify. These elements are knowledge discovery, actionable information, short-term and long-term benefits, the resolution of pain points, and several others that are aligned with making a business process better by providing insight. In most instances, Big Data is a disruptive element when introduced into an enterprise, and this disruption includes issues of scale, storage, and data center design. The disruption normally involves costs associated with hardware, software, staff, and support, all of which affect the bottom line.

This includes the drivers of the project, how others are using Big Data, what business processes Big Data will align with, and the overall goal of implementing the project. Benefits analysis. It is often difficult to quantify the benefits of Big Data as static and tangible. Big Data analytics is all about the interpretation of data and the visualization of patterns, which amounts to a subjective analysis, highly dependent on humans to translate the results. However, that does not prevent a business case from including benefits driven by Big Data in nonsubjective terms (e.g., identifying sales trends, locating possible inventory shrinkage, quantifying shipping delays, or measuring customer satisfaction). The trick is to align the benefits of the project with the needs of a business process or requirement. An example of that would be to identify a business goal, such as 5 percent annual growth, and then show how Big Data analytics can help to achieve that goal.


pages: 242 words: 245

The New Ruthless Economy: Work & Power in the Digital Age by Simon Head

Asian financial crisis, business cycle, business process, call centre, conceptual framework, deskilling, Erik Brynjolfsson, Ford paid five dollars a day, Frederick Winslow Taylor, informal economy, information retrieval, medical malpractice, new economy, Panopticon Jeremy Bentham, shareholder value, Shoshana Zuboff, Silicon Valley, single-payer health, supply-chain management, telemarketer, Thomas Davenport, Toyota Production System, union organizing

In my field work I found again and again that information technology was being used to renew a long-established industrial culture whose values had supposedly been displaced by those of the "new economy." These established practices included the standardization, simplification, and measurement of tasks; the preoccupation with monitoring and control; the persistence of hierarchical relationships between managers and employees; and the unceasing efforts to speed up "business processes" with "business process reengineering." These practices have not only survived in U.S. manufacturing, where they have been embedded for over a century, but they have also crossed over and colonized the service industries which now dominate the U.S. economy. The most spectacular example of this colonization is the rise of "managed care," which is essentially the industrialization and reengineering of health care.

and "enterprise resource planning" (ERP) have been prime examples of workplace practices built around new information technologies. Relying on computers and their attendant software, reengineering and ERP automate, simplify, join together, and speed up business processes. Reengineering and ERP do this by imposing upon these processes the standardization, measurement, and control of the old industrial assembly line. Despite their heavy reliance on advanced digital technologies, the two practices therefore remain profoundly "old economy" phenomena.11 Reengineering was a buzz word of management theorists in the early and mid-1990s and then, like so many management fads, it seemed to fade away. But businesses have kept reengineering their business processes. In 1995, when the reengineering tide was high, a survey conducted by two of the Big Six accounting firms found that between 75 and 80 percent of America's largest companies had already begun reengineering and "would be increasing their commitment to it over the next few years."12 By 2000, when the practice had morphed into ERP, the leading IT consultancy, AMR Research of Boston, could state that "most companies now consider core ERP applications as part of the cost of doing business, a necessary part of the organization's infrastructure."13 There is scarcely a business activity that has escaped the attention of the reengineers.

But over the past ten years, reengineers have steadily widened the scope and ambition of their activities to include sales, marketing, customer relations, accounting, personnel management, and even medicine—"managed care" being essentially the reengineering of health care. For the 80 percent of Americans now employed in these service occupations, reengineering in its various forms has become a dominant force in their working lives. In the mid- and late 1990s, reengineering evolved into ERP, a form of hyper-reengineering that brings together single business processes and tries to weld them into giant mega-processes. Led by the German software maker SAP, the reengineers of ERP are inspired by a vision in 5 6 THE NEW RUTHLESS ECONOMY which business processes great and small—from the ordering of office furniture to the drawing up of strategic plans—all can be made to operate together with the smooth predictability of the mass production plant. But getting these ERP systems to work is turning out to be much more difficult than corporate reengineers had expected, and the subversive figure of Rube Goldberg and his fantastic machines keep peeping out from ERP's sprawling, unwieldy structures.


pages: 791 words: 85,159

Social Life of Information by John Seely Brown, Paul Duguid

business process, Claude Shannon: information theory, computer age, cross-subsidies, disintermediation, double entry bookkeeping, Frank Gehry, frictionless, frictionless market, future of work, George Gilder, George Santayana, global village, Howard Rheingold, informal economy, information retrieval, invisible hand, Isaac Newton, John Markoff, Just-in-time delivery, Kenneth Arrow, Kevin Kelly, knowledge economy, knowledge worker, lateral thinking, loose coupling, Marshall McLuhan, medical malpractice, moral hazard, Network effects, new economy, Productivity paradox, Robert Metcalfe, rolodex, Ronald Coase, shareholder value, Shoshana Zuboff, Silicon Valley, Steve Jobs, Superbowl ad, Ted Nelson, telepresence, the medium is the message, The Nature of the Firm, The Wealth of Nations by Adam Smith, Thomas Malthus, transaction costs, Turing test, Vannevar Bush, Y2K

These contrasting sources of meaning and understanding present business process reengineering and process views of organization with difficulties for several reasons. First, business process reengineering tends to be somewhat monotheistic. There is not much room for variation in meaning in its camp. The process view is expected to explain all. Second, despite talk of rebuilding from the bottom up and empowerment, business process reengineering tends to be relentlessly top down. Indeed, some suggest that it is of necessity Page 98 a top-down, command-and-control procedure. 14 (It is not surprising that one of the most enthusiastic and successful reengineers has been the army.) Together, these two biases of business process reengineering make it hard to see and harder to understand the needs of people whose practices make up processes.

Opportunities for them to craft, change, own, or take charge of process in any meaningful way are limited.16 While lip service is paid to them, improvisation and "local" knowledge have little place in these schema, particularly if they challenge the coordination of process. And fourth, business process reengineers tend to discourage exactly the sort of lateral links that people pursue to help make meaning. Focused on longitudinal cross-functionality, they dislike, and often try to discourage or even disempower, occupational groups, job categories, and local workplace cultures. Encouraging cross-functional links between occupations, business process reengineering tends to see the contrasting links within occupational groups as non-value adding. Here, then, we see in another form the problems that beset the worker at home alone, which we discussed in chapter 3. Focusing on individuals, process accounts overlook social resources that people in similar occupations provide one another.

This sort of self-deception is, we suspect, especially acute in organizations who focus on process, unreconstructed or reengineered, and the information it provides to the exclusion of all else. Lateral Thrust We have described the process view as a "longitudinal" view. It seeks to overcome divisions of labor and establish cross-functional links. As such, its goals are admirable. Business processes provide the backbone of organization, structure amid the spontaneity of practice. But in pursuit of this backbone, business process reengineering has generally been indifferent to practice and even hostile to the solidarity of occupational groups and occupational cultures. Specialist in Hammer and Champy's work is almost a term of abuse. 38 Lateral ties, ties that do not follow the lines of process, are readily dismissed as "non-value adding." Yet research into work groups, like research into the difficulties of home working (see chapter 3), suggests that people rely heavily on lateral, occupational ties to overcome the limits of process-based information.


Mastering Structured Data on the Semantic Web: From HTML5 Microdata to Linked Open Data by Leslie Sikos

AGPL, Amazon Web Services, bioinformatics, business process, cloud computing, create, read, update, delete, Debian, en.wikipedia.org, fault tolerance, Firefox, Google Chrome, Google Earth, information retrieval, Infrastructure as a Service, Internet of things, linked data, natural language processing, openstreetmap, optical character recognition, platform as a service, search engine result page, semantic web, Silicon Valley, social graph, software as a service, SPARQL, text mining, Watson beat the top human players on Jeopardy!, web application, wikimedia commons

Using a Mediator usesMediator _"http://example.com/importMediator" Web Services Business Process Execution Language (WS-BPEL) Business processes require sophisticated exception management, enterprise collaboration, task sharing, and end-to-end control. The Web Services Business Process Execution Language (WS-BPEL), often abbreviated as BPEL (Business Process Execution Language), is an XML-based standard language for specifying web service actions for business processes. BPEL is suitable for Service-Oriented Architectures (SOA), and is implemented by industry giants such as Oracle and based on earlier execution languages, such as IBM’s Web Service Flow Language (WSFL) and Microsoft’s XLang. The ten original design goals of BPEL are the following: 1. Define business processes that interact with external entities through web service operations and that manifest themselves as web services.

Support the implicit creation and termination of process instances as the basic life cycle mechanism. 8. Define a long-running transaction model based on compensation actions and scoping to support failure recovery for parts of long-running business processes. 9. Use web services as the model for process decomposition and assembly. 10. Build on web services standards. In order to define logic for service interactions, BPEL defines business process behavior through web service orchestration. BPEL processes transfer information using the web service interfaces. BPEL can model web service interactions as executable business processes, as abstract business processes, or through the behavior of processes. The BPEL programming language supports 140 • Message sending and receiving • XML and WSDL typed variables • A property-based message correlation mechanism Chapter 5 ■ Semantic Web Services • An extensible language plug-in model to allow writing expressions and queries in multiple languages1 • Structured-programming constructs, such as if-then-elseif-else, while, sequence, and flow • Logic in local variables, fault-handlers, compensation-handlers, and event-handlers • Scopes to control variable access Some of the popular BPEL engines are Apache ODE, BizTalk Server, Oracle BPEL Process Manager, SAP Exchange Infrastructure, Virtuoso Universal Server, and WebSphere Process Server.

Define business processes that interact with external entities through web service operations and that manifest themselves as web services. Both the operations and the web services are defined using WSDL 1.1. 2. Define business processes based on an XML serialization. Do not define a graphical representation of processes or provide any particular design methodology for processes. 3. Define a set of web service orchestration concepts to be used by external (abstract) and internal (executable) views of a business process. 4. Provide hierarchical as well as graph-like controls. 5. Provide data manipulation functions for process data and control flow. 6. Support an identification mechanism for process instances that allows the definition of instance identifiers at the application message level. 7. Support the implicit creation and termination of process instances as the basic life cycle mechanism. 8.


pages: 355 words: 81,788

Monolith to Microservices: Evolutionary Patterns to Transform Your Monolith by Sam Newman

Airbnb, business process, continuous integration, database schema, DevOps, fault tolerance, ghettoisation, inventory management, Jeff Bezos, Kubernetes, loose coupling, microservices, MVC pattern, price anchoring, pull request, single page application, software as a service, source of truth, telepresence

BPM Tools? Business process modeling (BPM) tools have been available for many years. By and large, they are designed to allow nondevelopers to define business process flows, often using visual drag-and-drop tools. The idea is developers would create the building blocks of these processes, and then nondevelopers would wire these building blocks together into the larger process flows. The use of such tools seems to line up really nicely as a way of implementing orchestrated sagas, and indeed process orchestration is pretty much the main use case for BPM tools (or, in reverse, the use of BPM tools results in you having to adopt orchestration). In my experience, I’ve come to greatly dislike BPM tools. The main reason is that the central conceit—that nondevelopers will define the business process—has in my experience almost never been true.

The tooling aimed at nondevelopers ends up getting used by developers, and they can have a host of issues. They often require the use of GUIs to change the flows, the flows they create may be difficult (or impossible) to version control, the flows themselves may not be designed with testing in mind, and more. If your developers are going to be implementing your business processes, let them use tooling that they know and understand and is fit for their workflows. In general, this means just letting them use code to implement these things! If you need visibility as to how a business process has been implemented, or how it is operating, then it is far easier to project a visual representation of a workflow from code than it is to use a visual representation of your workflow to describe how your code should work. There are efforts to create more developer-friendly BPM tools.

With orchestration, our process was explicitly modeled in our orchestrator. Now, with this architecture as it is presented, how would you build up a mental model of what the process is supposed to be? You’d have to look at the behavior of each service in isolation and reconstitute this picture in your own head—far from a straightforward process even with a simple business process like this one. The lack of an explicit representation of our business process is bad enough, but we also lack a way of knowing what state a saga is in, which can also deny us the chance to attach compensating actions when required. We can push some responsibility to the individual services for carrying out compensating actions, but fundamentally we need a way of knowing what state a saga is in for some kinds of recovery. The lack of a central place to interrogate around the status of a saga is a big problem.


pages: 227 words: 32,306

Using Open Source Platforms for Business Intelligence: Avoid Pitfalls and Maximize Roi by Lyndsay Wise

barriers to entry, business intelligence, business process, call centre, cloud computing, commoditize, different worldview, en.wikipedia.org, Just-in-time delivery, knowledge worker, Richard Stallman, software as a service, statistical model, supply-chain management, the market place

More and more companies are starting their BI implementations from a vantage point of dashboard delivery3 instead of from traditional reporting or OLAP4 cubes, with the goal of taking advantage of self-service models.5 Consequently, businesses are transitioning from historical analysis towards the monitoring of key performance indicators (KPIs) or metrics to help them monitor performance and to identify the cause and effect of various business processes and activities. The use of metrics makes business analytics more business-process centric by making sure that business decisions and the way in which they are being applied within the organization are tied to the management of business performance. For instance, sales dashboards are very popular. The general goal of many of these dashboards is to identify how products are performing within various regions and to let sales managers manage their staff.

Some solution providers offer packaged services, while others charge between $185 and $250 an hour.5 Maintenance and licensing fees represent recurring costs to the business that will be applied as long as the OSBI solution is in use. Depending on the structure of vendor services and longer term usage, companies may have to face the fact that these costs will increase over time, and in some cases astronomically, depending on overall use. Business process re-engineering getting things done faster unfortunately, this represents the most subjective part of any ROI and TCO calculation, but is also one of the most important soft factors of BI adoption. Here, organizations require the ability to evaluate general inefficiencies and identify how BI can help make business processes more effective. In many cases, organizations can leave this out of equations unless there are specific equations that apply or that can be identified. 5 These prices are based on my general interactions with vendors and don’t represent a study of hundreds of offerings.

In relation to metrics, business rules help define the algorithms by looking at the calculations that are required to create the appropriate analytics. In some cases, this includes complex algorithms that are developed by IT based on the input from business, and in other cases, these business rules and calculations already exist within current spreadsheet or analytics applications. Business processes. The business processes put these factors together. In essence, they provide a broader view of how individual departments work and what that means for the broader organization. On a high level, this requires an understanding of how each department works at a management level and how that relates to other departments. A good example remains the interrelationship between sales and marketing and the overlap of data that is required to enable both departments to run smoothly.


The End of Accounting and the Path Forward for Investors and Managers (Wiley Finance) by Feng Gu

active measures, Affordable Care Act / Obamacare, barriers to entry, business cycle, business process, buy and hold, Claude Shannon: information theory, Clayton Christensen, commoditize, conceptual framework, corporate governance, creative destruction, Daniel Kahneman / Amos Tversky, discounted cash flows, disruptive innovation, diversified portfolio, double entry bookkeeping, Exxon Valdez, financial innovation, fixed income, hydraulic fracturing, index fund, information asymmetry, intangible asset, inventory management, Joseph Schumpeter, Kenneth Arrow, knowledge economy, moral hazard, new economy, obamacare, quantitative easing, quantitative trading / quantitative finance, QWERTY keyboard, race to the bottom, risk/return, Robert Shiller, Robert Shiller, shareholder value, Steve Jobs, The Great Moderation, value at risk

Thus, the second attribute of our proposed information system is comprehensive disclosure about the mapping of investments (outlays) to resources (assets): ■ Usefulness attribute no. 2: Inform investors with specificity about the investments (expenditures) made in the process of building the enterprise’s strategic assets (customer acquisition costs for telecom and internet companies, for example). One such investment, R&D, is currently reported in the income statement, whereas most other investments—brand creation and maintenance, technology acquisitions, employee training, consultants’ work on business processes, media content creation, IT support of business processes, and like investments—are lumped in the income statement with regular expense items, generally in SG&A, and hence are obscured from investors. We challenge anyone to explain the logic underlying the current practice of separately reporting in the income statement innocuous expenses, such as interest, but not, say, the generally larger and much more consequential information systems expenditures.

Other strategic assets are legal rights and licenses (cellular spectrum, TV licenses), content (movies, TV serials), and unique business processes (e.g., Netflix’s and Amazon’s customer recommendation algorithms). Achieving sustained competitive advantage in media and entertainment is a major challenge due to fierce competition and low entry barriers. Accordingly, detailed information on companies’ strategic resources, their vulnerabilities, deployment, and productivity is essential for investors and lenders to make successful investment decisions and monitor managers. That’s indeed the gist of most analysts’ questions in the sector’s many conference calls that we examined. Conventional accounting and financial reports in this sector are particularly deficient, since most investments in strategic resources are immediately expensed (brand creation, customer acquisition costs, business processes) and, therefore, absent from the balance sheet, while other assets (cellular spectrum) are presented at historical, mostly outdated values.

ABOUT US AND OUR APPROACH We, the writers of this book, are veteran accounting and finance researchers and educators, and one of us has extensive experience in public accounting, business, and consulting. For years we have documented in academic journals the failure of the accounting and financial reporting system to adjust to the revolutionary changes in the business models of modern corporations, from the traditional industrial, heavy asset-based model to information-intensive, intangibles-based business processes underlying modern companies, as well as documenting other accounting shortcomings. While not alone in this endeavor, our impact on accounting and financial reporting regulations has regrettably been so far very limited. But we now sense an opportunity for a significant change, motivating this book. The deterioration in the usefulness of financial information has been so marked, that it can no longer be glossed over.


pages: 347 words: 97,721

Only Humans Need Apply: Winners and Losers in the Age of Smart Machines by Thomas H. Davenport, Julia Kirby

AI winter, Andy Kessler, artificial general intelligence, asset allocation, Automated Insights, autonomous vehicles, basic income, Baxter: Rethink Robotics, business intelligence, business process, call centre, carbon-based life, Clayton Christensen, clockwork universe, commoditize, conceptual framework, dark matter, David Brooks, deliberate practice, deskilling, digital map, disruptive innovation, Douglas Engelbart, Edward Lloyd's coffeehouse, Elon Musk, Erik Brynjolfsson, estate planning, fixed income, follow your passion, Frank Levy and Richard Murnane: The New Division of Labor, Freestyle chess, game design, general-purpose programming language, global pandemic, Google Glasses, Hans Lippershey, haute cuisine, income inequality, index fund, industrial robot, information retrieval, intermodal, Internet of things, inventory management, Isaac Newton, job automation, John Markoff, John Maynard Keynes: Economic Possibilities for our Grandchildren, John Maynard Keynes: technological unemployment, Joi Ito, Khan Academy, knowledge worker, labor-force participation, lifelogging, longitudinal study, loss aversion, Mark Zuckerberg, Narrative Science, natural language processing, Norbert Wiener, nuclear winter, pattern recognition, performance metric, Peter Thiel, precariat, quantitative trading / quantitative finance, Ray Kurzweil, Richard Feynman, risk tolerance, Robert Shiller, Robert Shiller, Rodney Brooks, Second Machine Age, self-driving car, Silicon Valley, six sigma, Skype, social intelligence, speech recognition, spinning jenny, statistical model, Stephen Hawking, Steve Jobs, Steve Wozniak, strong AI, superintelligent machines, supply-chain management, transaction costs, Tyler Cowen: Great Stagnation, Watson beat the top human players on Jeopardy!, Works Progress Administration, Zipcar

This brings us to the next hurdle for smart machines: actually performing some of the tasks implied by their analysis rather than leaving them for humans to execute. Of course this is easiest when the task itself is purely digital. An example would be the task of tracking the work done and decisions made in a standard business process. So-called business process management (BPM) tools help people maintain control over complicated operations by monitoring workflows, measuring output, and analyzing performance. “Intelligent business process management” can even go so far as to intervene according to programmed rules to improve performance. But humans are still the ones designing the work processes in the first place and writing the rules for machines to enact. Finally, some machines are able to execute tasks that go beyond the digital environment and require manipulation of objects in the physical world.

They would rather companies focus on the potential in freeing up skilled employees from doing lower-skill tasks—such as answering the same boring questions from customers all the time—and giving them higher-level opportunities. They could imagine, for example, companies that really care about their customers proactively reaching out to contact them about problems and issues before the customer seeks help. Zuin knows that the first wave of automation probably will involve taking some people out of business processes, but she hopes for a second wave involving reshaping business processes and work designs to take advantage of technologies like Amelia and IPcenter. In short, she’s pulling for augmentation rather than just automation. Entrepreneurs —We don’t think that entrepreneurs in the automated decision software space are necessarily different in systematic ways than any other type of technology entrepreneur. But we know they are essential.

Ronanki says that almost all clients want to try a pilot as the second step, because the technology is new (at least to them) and they’re not sufficiently confident to forge ahead with a full implementation. The pilot might be used on a subset of the business process or involve a thinner slice of functionality. That typically requires four to six months. The third and final step in a consulting project, then, involves scaling the pilot into production. This step involves programming the system, doing system integration to connect it with data, assembling the “corpus” (the body of knowledge from which the system will learn), training the system with a training data set, and testing it. At this third stage, Ronanki says, he and his colleagues work with “superusers” (a term we previously compared to the “step-in” role) who understand the business process and are able to help configure the system and help other users to perform their work with it. For this role they seek the most expert and successful frontline resources, so that the system is learning from the best.


pages: 161 words: 44,488

The Business Blockchain: Promise, Practice, and Application of the Next Internet Technology by William Mougayar

Airbnb, airport security, Albert Einstein, altcoin, Amazon Web Services, bitcoin, Black Swan, blockchain, business process, centralized clearinghouse, Clayton Christensen, cloud computing, cryptocurrency, disintermediation, distributed ledger, Edward Snowden, en.wikipedia.org, Ethereum, ethereum blockchain, fault tolerance, fiat currency, fixed income, global value chain, Innovator's Dilemma, Internet of things, Kevin Kelly, Kickstarter, market clearing, Network effects, new economy, peer-to-peer, peer-to-peer lending, prediction markets, pull request, QR code, ride hailing / ride sharing, Satoshi Nakamoto, sharing economy, smart contracts, social web, software as a service, too big to fail, Turing complete, web application

It’s better to implement smaller blockchain projects end-to-end where you can see results and a full lifecycle of usage with real users. That said, POCs can be used to narrow down a portfolio of committed projects, but you need to move beyond them. Issue 12: Business Process vs.Technology I have long argued that implementing the blockchain is 80% about business process changes and 20% about figuring out the technology behind it. Of course, this assumes that you want to be ambitious enough to tackle the required toughness in changing business processes. If you think that the blockchain technology is not ready yet, or has some weaknesses that might be solved later, then use that time to start reengineering your business process, and by the time you are done the technology will be ready. Issue 13: Use Cases Saturation Brainstorming to find use cases is good as an initial entry point, but it is not enough.

So the tipping point was to compete by reframing the opportunity, for example, peer-to-peer lending, unconventional home loans, really fast approval cycles, efficient robot investing, and so on. Creating Opportunities It is more difficult to figure out opportunities, because that requires applying innovation, being creative, and making profound changes. These are more difficult objectives to achieve, because business process changes are involved, and it takes a longer time to change them. When you sum it up, the blockchain is about 80% business process changes, and 20% technology implementation. Creating new opportunities includes entering new markets and/or providing new services that the blockchain enables and that were not possible before. It requires a more imaginative process of dreaming up what’s possible and what wasn’t done before. It requires thinking outside the proverbial box, and a deep understanding of what the blockchain can enable in the areas that it is strongly suited for.

The first chapter was essential for laying out the multiple capabilities of the blockchain technology, paving the way for your understanding of its usage, and making you believe that peer-to-peer transactions can be finalized on the blockchain, without known intermediaries, except for the blockchain itself. Blockchain is not a one-trick pony. It is a multi-headed beast that takes many forms. If you see it as a technology, then you will implement it as a technology. If you see it as a business change enabler, then you will think about business processes. If you discern the legal implications, you will be emboldened by its new governance characteristics. And if you see it as a blank sheet of paper for designing new possibilities that either didn’t exist before, or that challenge existing legacies, then you will want to get very creative at dreaming up these new opportunities. At its genesis, blockchain (and certainly Bitcoin) is a technology that came to life to challenge the status quo, without preconceived sympathy to what the status quo held on to.


Big Data at Work: Dispelling the Myths, Uncovering the Opportunities by Thomas H. Davenport

Automated Insights, autonomous vehicles, bioinformatics, business intelligence, business process, call centre, chief data officer, cloud computing, commoditize, data acquisition, disruptive innovation, Edward Snowden, Erik Brynjolfsson, intermodal, Internet of things, Jeff Bezos, knowledge worker, lifelogging, Mark Zuckerberg, move fast and break things, move fast and break things, Narrative Science, natural language processing, Netflix Prize, New Journalism, recommendation engine, RFID, self-driving car, sentiment analysis, Silicon Valley, smart grid, smart meter, social graph, sorting algorithm, statistical model, Tesla Model S, text mining, Thomas Davenport

Just for the historical record, FORCE stood for: • Fact-based decision making • Organization of analysts and other resources • Continual review of business assumptions and analytical ­models • Reinforcing culture of analytical decisions and “test and learn” • Embedding analytics in major business processes All of these factors are also important to big data, but many of them are discussed elsewhere in this book. So in this section I’ll consider only two of the letters—C (culture), and E (embedding analytics—and big data—in major business processes). We did end up writing chapters on those topics in Analytics at Work, so I will refer you to that book for comments on them with regard to traditional analytics. The following sections relate to some special issues for big data. Chapter_06.indd 146 03/12/13 12:24 PM What It Takes to Succeed with Big Data   147 Culture Is there a big data culture?

And we know more and more about the irrational decision processes that many humans Chapter_06.indd 149 03/12/13 12:24 PM 150 big data @ work employ; why wouldn’t we prefer more automated analytical decisions in many cases? Analytics in the small data era were just beginning to become more automated when big data came along. Now we have no choice but to embed big data–based analyses into business processes. Some ­analysts refer to this as smart BPM (business process management); others, such as James Taylor, are advocates of the term enterprise decision management. Regardless of what we call it, it needs to happen more in the future. It’s already true in many aspects of the financial services industry, but it needs to move into many other industries as well.8 Take, for example, an application that manages arrivals and departures at Heathrow Airport, created by Heathrow Airport Holdings, previously known as the British Airport Authority.9 The airport gets 65 million passengers a year and runs at 98 percent runway capacity for its thirteen hundred flights per day, so making good decisions rapidly about what to do with arriving and departing planes is critical to its success.

An analyst can build models, run them, observe what happens, and if he doesn’t like something, change it, all in one minute. This cycle used to take eight hours—if you could do it at all. The train of thought is much more continuous, which means a higher quality of research.”5 If your company is primarily interested in time reduction, you need to work much more closely with the owner of the relevant business process. A key question is, what are you going to do with all the time saved in the process? Respectable business-oriented answers include: • We’re going to be able to run a lot more models and better understand the drivers of our performance in key areas. • We’re going to iterate and tune the model much more frequently to get a better solution. Chapter_03.indd 64 03/12/13 11:28 AM Developing a Big Data Strategy   65 • We’re going to use many more variables and more data to ­compute a real-time offer for our customers. • We’re going to be able to respond much more rapidly to ­contingencies in our environment.


pages: 302 words: 82,233

Beautiful security by Andy Oram, John Viega

Albert Einstein, Amazon Web Services, business intelligence, business process, call centre, cloud computing, corporate governance, credit crunch, crowdsourcing, defense in depth, Donald Davies, en.wikipedia.org, fault tolerance, Firefox, loose coupling, Marc Andreessen, market design, MITM: man-in-the-middle, Monroe Doctrine, new economy, Nicholas Carr, Nick Leeson, Norbert Wiener, optical character recognition, packet switching, peer-to-peer, performance metric, pirate software, Robert Bork, Search for Extraterrestrial Intelligence, security theater, SETI@home, Silicon Valley, Skype, software as a service, statistical model, Steven Levy, The Wisdom of Crowds, Upton Sinclair, web application, web of trust, zero day, Zimmermann PGP

Send email to index@oreilly.com. 269 3-D Secure protocol, 77 e-commerce security, 84 security pitfall in, 71 Ayres, Ian, 164 Azure cloud operating system, 152 B B.J.’s Wholesale Club, 50 backend control systems, 18–20 backward compatibility LANMAN password encoding, 6 learned helplessness and, 2 legacy systems, 7 PGP issues, 117 balance in information security, 202–207 banking industry (see financial institutions) banking trojans, 141, 249 banner ads exploit-laden, 89–92, 143 honeyclients and, 143 banner farms, 98, 99 Barings Bank security breach, 38–49 Barnes & Noble, 50 Bass-O-Matic cipher, 117 behavioral analytics, 254 Bell Labs background, 171, 173 software development lifecycle, 174–178 Bellis, Ed, 73–86 Bernstein, Peter, 33 Bidzos, Jim, 117, 118 Biham, Eli, 117 biometrics, 37–38 BITS Common Criteria for Software, 193 Black Hat Conference, 161 blacklisting, 252, 254 Blaster virus, 248 blogging, 166 BoA Factory site, 65 Bork, Robert, 241 Boston Market, 50 botnets army building software, 67 attack infrastructure, 66 challenges in detecting, 231 client-side vulnerability, 131 CPC advertising, 100, 101 cyber underground and, 64 functionality, 64, 69, 230 peer-to-peer structure, 66 BPM (Business Process Management) levels of effective programs, 157 multisite security, 156–158 potential for, 154–158 supply chain composition and, 155 270 INDEX BPMI (Business Process Management Initiative), 157 breaches (see security breaches) bridge CAs, 111 Briggs, Matt, 140 brute-force attacks, 28, 251 buffer overflows security vulnerability, 15, 131 SQL Slammer worm, 225 Business Process Management (see BPM) Business Process Management Initiative (BPMI), 157 business rules engines, 157 C California AB 1950, 207 California SB 1386 balance in information security, 203–205 on data sharing, 36, 38 on reporting breaches, 55 passage of, 207 call options, 40 Callas, Jon, 107–130 Capture-HPC honeyclient, 138, 145 CardSystems security breach, 211 Carnegie Mellon CMMI process, 185 Carr, Nicholas, 157 Carter Doctrine, 201 CAs (see certificate authorities) cashiers (cyber underground) defined, 65 drop accounts, 70 CDC (Centers for Disease Control and Prevention), 36 Center for Internet Security (CIS), 45 Center for Strategic and International Studies (CSIS), 201 Centers for Disease Control and Prevention (CDC), 36 certificate authorities, 112 (see also introducers in PGP) certification support, 111 DSG support, 203 establishing trust relationships, 27 hierarchical trust, 109 SET requirements, 78 certificates, 109 (see also specific types of certificates) defined, 111 revoking, 120–122 self-signed, 109 verifying, 109 Web of Trust support, 113 certification defined, 111 OpenPGP colloquialism for, 112 OpenPGP support, 111 CFAA (Computer Fraud and Abuse Act), 207 Charney, Scott, 201 Chuvakin, Anton, 213–224, 226 Cigital, 171, 188 Citi, 79 CLASP methodology, 187, 188 click fraud botnet support, 66, 101 CPA advertising, 102 federal litigation, 102 client-side vulnerabilities, 133 (see also honeyclients) background, 131–132 malware exploitation, 15, 132, 141–143 naïveté about, 8–9 Clinton, Bill, 17 cloud computing applying security to, 152 builders versus breakers, 151 defined, 150 identity management services, 154 CNCI (Comprehensive National Cybersecurity Initiative), 202 CNN network, 16 COBIT regulation, 214 Code Red virus, 248 Commerce, Department of, 180 commercial software (see software acquisition) Commission Junction affiliate network, 102 Commission on Cyber Security for the 44th Presidency, 201 Common Vulnerabilities and Exposures (CVE) database, 131 communication cyber underground infrastructure, 65, 66 information security and, 207–211 Comprehensive National Cybersecurity Initiative (CNCI), 202 Computer Fraud and Abuse Act (CFAA), 207 confidentiality of data, 85 confirmation traps defined, 10 intelligence analysts, 12 overview, 10–11 rationalizing capabilities, 13 stale threat modeling, 12 contagion worm exploit, 131 cookies, stuffed, 102 cost per action (see CPA advertising) cost per click (see CPC advertising) Cost Per Thousand Impressions (see CPM advertising) COTS (see software acquisition) coverage metrics, 46 CPA advertising functionality, 100 inflating costs, 102–103 stuffed cookies, 102 CPC advertising click-fraud detection services, 101 functionality, 100–101 syndication partnerships, 100 CPM advertising basis of, 98 fraud-prone, 100–103 credit card information as shared secret, 75–76, 85 card associations and, 82 checking site authenticity, 26 consumers and, 81, 83 current market value, 66 CV2 security code, 76 cyber underground and, 65 devaluing data, 71 e-commerce security, 73–75 financial institutions, 82 identity theft, 23–25 merchants and service providers, 81, 83 PCI protection, 44 proposed payment model, 86 spyware stealing, 69 SQL injection attacks, 69 TJX security breach, 50 virtual cards, 79 cross-certification, 111 cross-site scripting, 188 crowdsourcing, 161 Crypto Wars, 118 CSIS (Center for Strategic and International Studies), 201 culture, organizational, 200–202 cumulative trust, 110 Curphey, Margaret, 169 Curphey, Mark, 147–169 CV2 security code, 76 CVE (Common Vulnerabilities and Exposures) database, 131 cyber underground attack infrastructure, 66 attack methods, 68–70 cashiers, 65 combating, 71–72 communication infrastructure, 65 CSI-FBI Study, 63 data exchange example, 67 fraudsters and attack launchers, 65 goals of attacks, 63, 226, 230 information dealers, 64 INDEX 271 information sources, 68 makeup and infrastructure, 64–66 malware producers, 64 money laundering and, 70 payoffs, 66–71 resource dealers, 64 Cydoor ad network, 90 D Danford, Robert, 144 Data Encryption Standard (DES), 4 data integrity, 85 Data Loss Database (DataLossDB), 36, 55–58 data responsibility incentive/reward structure, 72 social metric for, 72 data theft as cottage industry, 67 botnet support, 66 combating, 71 from merchant stores, 68 incident detection considerations, 237 spyware and, 69 data translucency additional suggestions, 245 advantages, 244 disadvantages, 245 overview, 239–242 personal data and, 244 real-life example, 243 data-sharing mechanisms DHS support, 36 security flaws in, 35 databases data translucency in, 239–246 logging support, 221 security breaches and, 239 Dave & Buster’s, 50 Davies, Donald, 148 DCS systems, 18 DDoS (distributed denial of service) attacks on major ISPs, 16 botnet support, 66, 231 client-side vulnerability, 131 honeyclients and, 138 LANs and, 28 deceptive advertisements, 94–98 Defense, Department of, 213 Dell computers, 131 Deloitte & Touche, LLP, 201 denial of service (see DDoS) Department of Agriculture, 196 Department of Commerce, 180 Department of Defense, 213 Department of Homeland Security, 36 272 INDEX deperimeterization, 156 DES (Data Encryption Standard), 4 designated revokers, 121 DHCP lease logs, 237 DHS (Department of Homeland Security), 36 Diffie, Whitfield, 112 digital certificates (see certificates) Digital Point Systems, 102 Digital Signature Guidelines (DSG), 202–203 direct trust defined, 109 root certificates, 110 directionality, 227 distributed denial of service (see DDoS) distribution channels, 166 DKIM email-authentication, 124 Dobbertin, Hans, 119 doing the right thing in information security, 211– 212 drop accounts, 70 Drucker, Peter, 163 DSG (Digital Signature Guidelines), 202–203 DSW Shoe Warehouse, 50 Dublin City University, 144 Dunphy, Brian, 225–237 Durick, J.D., 138 dynamic testing, 190 E e-commerce security 3-D Secure protocol, 76–78 analyzing current practices, 74–75 authorizing transactions, 84 broken incentives, 80–83 confidentiality of data, 85 consumer authentication, 83 data integrity, 85 exploiting website vulnerabilities, 68 friendly fraud and, 84 merchant authentication, 83 new security model, 83–86 not sharing authentication data, 84 portability of authentication, 85 primary challenges, 73 proposed payment model, 86 SET protocol, 78 shared secrets and, 75–76, 85 virtual cards, 79 EAP (Extensible Authentication Protocol), 51 Earned Value Management (EVM), 173 eBay CPA advertising, 102 DDoS attacks on, 16 principle of reliability, 160 ECPA (Electronic Communications Privacy Act), 207 Edelman, Benjamin, 89–105, 210, 250 Edwards, Betsy, 178 Einstein, Albert, 147 Electronic Communications Privacy Act (ECPA), 207 email log handling, 221 malware exploits, 248 EMBED tag, 94 encryption LAN Manager sequence, 4 PGP support, 107, 116–120 security certificates and, 22, 24 SET support, 78 Encyclopædia Britannica, 94–98 event logs (see logs) EVM (Earned Value Management), 173 executables, malware exploits and, 143 exportable signatures, 125 extended introducers, 123 Extensible Authentication Protocol (EAP), 51 F Facebook social network, 159, 165, 166 failing closed, 8 failing open, 8 false negatives, 236 false positives, 217, 236 Federal Sentencing Guidelines, 209 Federal Trade Commission (see FTC) financial institutions banking trojans, 141, 249 credit card information, 82 cyber attacks on, 68 drop accounts, 70 exploiting website vulnerabilities, 68, 187 federated authentication programs, 210 infosecurity and, 208 Finjan security firm, 65 Finney, Hal, 117 firewalls energy company vulnerabilities, 18 host logging, 232 log handling, 216, 221 need for new strategies, 248 SQL Slammer worm, 225 watch lists, 231 Flash ActionScript, 93 Forester, C.

This practice was not lost on the plethora of folks trying to compete for the lucrative and crucial identity management area. Identity management services such as OpenID and Windows Live ID operate in the cloud, allowing them to bind users together across domains. Connecting People, Process, and Technology: The Potential for Business Process Management Virtually every company will be going out and empowering their workers with a certain set of tools, and the big difference in how much value is received from that will be how much the company steps back and really thinks through their business processes, thinking through how their business can change, how their project management, their customer feedback, their planning cycles can be quite different than they ever were before. —Bill Gates New York Times columnist Thomas Friedman wrote an excellent book in 2005 called The World Is Flat (Farrar, Straus and Giroux) in which he explored the outsourcing revolution, from call centers in India and tax form processing in China to radiography analysis in Australia.

Business rules engines may analyze asset management systems and decide to take an analysis query that comes in from San Francisco and route it to China so it can be processed overnight and produce an answer for the corporate analysts first thing in the morning. This same fundamental change to the business process of security research will likely be extended to the intelligence feeds powering security technology, such as anti-virus engines, intrusion detection systems, and code review scanners. BPM software will be able to facilitate new business models, microchunking business processes to deliver the end solution faster, better, or more cheaply. This is potentially a major paradigm shift in many of the security technologies we have come to accept, decoupling the content from the delivery mechanism. In the future, thanks to BPM software security, analysts will be able to select the best anti-virus engine and the best analysis feed to fuel it—but they will probably not come from the same vendor.


Digital Accounting: The Effects of the Internet and Erp on Accounting by Ashutosh Deshmukh

accounting loophole / creative accounting, AltaVista, business continuity plan, business intelligence, business process, call centre, computer age, conceptual framework, corporate governance, data acquisition, dumpster diving, fixed income, hypertext link, interest rate swap, inventory management, iterative process, late fees, money market fund, new economy, New Journalism, optical character recognition, packet switching, performance metric, profit maximization, semantic web, shareholder value, six sigma, statistical model, supply-chain management, supply-chain management software, telemarketer, transaction costs, value at risk, web application, Y2K

The effects of the Internet on business are so pervasive that such diversity is understandable. For example, communication infrastructure, business processes, delivery of products and services, managerial philosophies and organizational structure are subject to change due to the influence of the Internet. For our purposes, the understanding of what e-commerce does is more critical than a specific term or definition. The three common threads that run through the definitions of e-commerce (and e-business) can be summarized as follows: • Electronic networks or the Internet is used as a communications medium for the exchange of business information • Provides capability to sell and deliver products or services on the Internet • Uses the networks and digital information to redesign inter- and intra-business processes and workflows. Copyright © 2006, Idea Group Inc. Copying or distributing in print or electronic forms without written permission of Idea Group Inc. is prohibited.

The effects of the Internet and e-commerce on business Meta Issues •Organizational Models •Business Strategies •Hardware and Software Infrastructure •Integration with ERP Systems Customers Demand Chain Management • Customer Relationship Management • Demand Forecasting • Order Management • Product and Brand Information Management • Channel Management • Customer Services • Business Intelligence Business Finance and Accounting •Financial Reporting •Internal Controls and Audit •Cost Accounting •Treasury Functions Human Resources •Payroll Accounting •Benefits Management •Personnel Management Production •Product Design •Product Development Other Business Processes •Document Storage and Retrieval •Workflows Suppliers Supply Chain Management • Supplier Relationship Management • Production Planning • Materials Management • Transportation and Distribution • Business Intelligence The effects of e-commerce, as can be seen, cut across various industries; industry intermediaries; and, the ultimate, consumers; and also within the industry itself. Ecommerce is more of an umbrella term that refers to all areas of business affected by use of the Internet and not merely selling and buying activities. The initial effect of e-commerce was on front-end business processes, especially sales and marketing in retail and consumer products segments (sometimes referred to as etailing).

The purpose of the knowledge warehouse is to store, organize, process and disseminate knowledge. This warehouse can contain business rules, best practices, business process information, and even decision support systems. Data can be in text or multimedia format. This module can also be used to create a training and documentation database. This enterprise-wide database can be used to cut down on the learning curve and training costs. Another building block of CRM tools is SAP exchange infrastructure. This exchange infrastructure supports different standards such as XML, Web Services Description Language (WSDL) and Simple Object Access Protocol (SOAP), along with different communication protocols. The objective is to enable collaborative business processes by cutting across various systems and protocols used within the organization. In the absence of such support, the costs of integrating different systems may become prohibitive.


pages: 314 words: 94,600

Business Metadata: Capturing Enterprise Knowledge by William H. Inmon, Bonnie K. O'Neil, Lowell Fryman

affirmative action, bioinformatics, business cycle, business intelligence, business process, call centre, carbon-based life, continuous integration, corporate governance, create, read, update, delete, database schema, en.wikipedia.org, informal economy, knowledge economy, knowledge worker, semantic web, The Wisdom of Crowds, web application

First, let’s define some of the critical terms of stewardship and ownership. 3.3.1 Ownership Definition Often business managers desire full control over all resources necessary to maintain and monitor the business processes, as well as the data and metadata for the IT applications. The potential exists that a business unit can “own” the processes, procedures, and IT applications used only within their organization. Ownership, therefore, is defined as the process of exercising sole authority over the resources being governed. However, ownership is not possible for enterprise-level business processes, data, applications, or metadata. As enterprises mature, it seems natural that more business applications develop into enterprise-level applications. Ownership of enterprise processes, procedures, data, and business metadata by one business unit is not achievable in most organizations; it requires the coordination of resources from many business units.

In addition, the level of data quality for metadata may differ based on the importance of the business processes supported by that metadata. The Data Warehousing Institute has published a data quality report4 that many organizations follow when defining their data quality programs. Organizations considering the following quality components for data should also be considering these conditions for each metadata object. 1. Accuracy: Does the metadata represent the current business condition, and is it from a verifiable source? 2. Integrity: Does the metadata conform to appropriate business and data structural rules? 3. Timeliness: Is the metadata available when personnel are attempting to access or use the data that it describes? Is it up to date with business processes, or is it outdated? 4. Consistency: Is the metadata consistent throughout, or does it conflict with other metadata descriptions?

Business Metadata Praise for Business Metadata “Despite the presence of some excellent books on what is essentially “technical” metadata, up until now there has been a dearth of wellpresented material to help address the growing need for interaction at the conceptual and semantic levels between data professionals and the business clients they support. In Business Metadata, Bill, Bonnie, and Lowell provide the means for bridging the gap between the sometimes “fuzzy” human perception of data that fuels business processes and the rigid information management models used by business applications. Look to the future: next generation business intelligence, enterprise content management and search, the semantic web all will depend on business metadata. Read this book!” —David Loshin, President, Knowledge Integrity Incorporated These authors have written a book that ventures into new territory for data and information management.


pages: 472 words: 117,093

Machine, Platform, Crowd: Harnessing Our Digital Future by Andrew McAfee, Erik Brynjolfsson

"Robert Solow", 3D printing, additive manufacturing, AI winter, Airbnb, airline deregulation, airport security, Albert Einstein, Amazon Mechanical Turk, Amazon Web Services, artificial general intelligence, augmented reality, autonomous vehicles, backtesting, barriers to entry, bitcoin, blockchain, British Empire, business cycle, business process, carbon footprint, Cass Sunstein, centralized clearinghouse, Chris Urmson, cloud computing, cognitive bias, commoditize, complexity theory, computer age, creative destruction, crony capitalism, crowdsourcing, cryptocurrency, Daniel Kahneman / Amos Tversky, Dean Kamen, discovery of DNA, disintermediation, disruptive innovation, distributed ledger, double helix, Elon Musk, en.wikipedia.org, Erik Brynjolfsson, Ethereum, ethereum blockchain, everywhere but in the productivity statistics, family office, fiat currency, financial innovation, George Akerlof, global supply chain, Hernando de Soto, hive mind, information asymmetry, Internet of things, inventory management, iterative process, Jean Tirole, Jeff Bezos, jimmy wales, John Markoff, joint-stock company, Joseph Schumpeter, Kickstarter, law of one price, longitudinal study, Lyft, Machine translation of "The spirit is willing, but the flesh is weak." to Russian and back, Marc Andreessen, Mark Zuckerberg, meta analysis, meta-analysis, Mitch Kapor, moral hazard, multi-sided market, Myron Scholes, natural language processing, Network effects, new economy, Norbert Wiener, Oculus Rift, PageRank, pattern recognition, peer-to-peer lending, performance metric, plutocrats, Plutocrats, precision agriculture, prediction markets, pre–internet, price stability, principal–agent problem, Ray Kurzweil, Renaissance Technologies, Richard Stallman, ride hailing / ride sharing, risk tolerance, Ronald Coase, Satoshi Nakamoto, Second Machine Age, self-driving car, sharing economy, Silicon Valley, Skype, slashdot, smart contracts, Snapchat, speech recognition, statistical model, Steve Ballmer, Steve Jobs, Steven Pinker, supply-chain management, TaskRabbit, Ted Nelson, The Market for Lemons, The Nature of the Firm, Thomas Davenport, Thomas L Friedman, too big to fail, transaction costs, transportation-network company, traveling salesman, Travis Kalanick, two-sided market, Uber and Lyft, Uber for X, uber lyft, ubercab, Watson beat the top human players on Jeopardy!, winner-take-all economy, yield management, zero day

Hammer and Champy’s basic message was that companies should think of themselves not as conducting tasks within departments (for example, buying raw material within a purchasing department), but instead as executing business processes—such as taking, assembling, and shipping a customer’s order—that inherently cut across departments. This sounds obvious now, but at the time it was considered both novel and important. Peter Drucker, the preeminent business guru of the twentieth century, said at the time, “Reengineering is new, and it has to be done.” The process lens typically revealed many tasks that were unnecessary and could be eliminated, or as Hammer and Champy put it, obliterated. The business process reengineering movement was accelerated in the mid-1990s by two advances: enterprise-wide information systems and the World Wide Web. Prior to the arrival of enterprise systems,* companies typically had a jumble of separate pieces of software, many of which were not linked.

.)‡ It coincided with the commercialization of the Internet, which had previously been primarily the domain of academics. The web enabled companies to extend their business processes beyond the four walls of the company and all the way to the consumer—a trend that became known as e-commerce. People started to use the web not only to search for and learn about a company’s products, but also to order and pay for them. This combination of efficiency and convenience has proved irresistible. Just ten years after the launch of Netscape, e-commerce accounted for approximately 10% of nonfood, nonautomotive retail sales in the United States. For two decades, then, web-enabled enterprise systems have been facilitating more and more business processes by doing the routine things: keeping track of account balances and transactions, calculating the right quantity and timing for raw-material deliveries, sending paychecks to employees, letting customers select and pay for products, and so on.

., 166–67 Angry Birds, 159–61 anonymity, digital currency and, 279–80 Antikythera mechanism, 66 APIs (application programming interfaces), 79 apophenia, 44n apparel, 186–88 Apple; See also iPhone acquiring innovation by acquiring companies, 265 and industrywide smartphone profits, 204 leveraging of platforms by, 331 Postmates and, 173, 185 profitability (2015), 204 revenue from paid apps, 164 “Rip, Mix, Burn” slogan, 144n as stack, 295 application programming interfaces (APIs), 79 AppNexus, 139 apps; See also platforms for banking, 89–90 demand curve and, 157–61 iPhone, 151–53 App Store, 158 Apter, Zach, 183 Aral, Sinan, 33 Archilochus, 60–61 architecture, computer-designed, 118 Aristophanes, 200 Arnaout, Ramy, 253 Arthur, Brian, 47–48 artificial general intelligence (AGI), 71 artificial hands, 272–75 artificial intelligence; See also machine learning current state of, 74–76 defined, 67 early attempts, 67–74 implications for future, 329–30 rule-based, 69–72 statistical pattern recognition and, 72–74 Art of Thinking Clearly, The (Dobelli), 43 arts, digital creativity in, 117–18 Ashenfelter, Orley, 38–39 ASICs (application-specific integrated circuits), 287 assets and incentives, 316 leveraging with O2O platforms, 196–97 replacement by platforms, 6–10 asymmetries of information, 206–10 asymptoting, 96 Atkeson, Andrew, 21 ATMs, 89 AT&T, 96, 130 August (smart door lock), 163 Austin, Texas, 223 Australia, 100 Authorize.Net, 171 Autodesk, 114–16, 119, 120 automated investing, 266–70 automation, effect on employment/wages, 332–33 automobiles, See cars Autor, David, 72, 101 background checks, 208, 209 back-office work, 82–83 BackRub, 233 Baidu, 192 Bakos, Yannis, 147n Bakunin, Mikhail, 278 Ballmer, Steve, 151–52 bandwagon effect, 217 banking, virtualization and, 89–90, 92 Bank of England, 280n bank tellers, 92 Barksdale, Jim, 145–46 barriers to entry, 96, 220 Bass, Carl, 106–7, 119–20 B2B (business-to-business) services, 188–90 Beastmode 2.0 Royale Chukkah, 290 Behance, 261 behavioral economics, 35, 43 Bell, Kristen, 261, 262 Benioff, Mark, 84–85 Benjamin, Robert, 311 Benson, Buster, 43–44 Berlin, Isiah, 60n Berners-Lee, Tim, 33, 34n, 138, 233 Bernstein, Michael, 260 Bertsimas, Dimitris, 39 Bezos, Jeff, 132, 142 bias of Airbnb hosts, 209–10 in algorithmic systems, 51–53 digital design’s freedom from, 116 management’s need to acknowledge, 323–24 and second-machine-age companies, 325 big data and Cambrian Explosion of robotics, 95 and credit scores, 46 and machine learning, 75–76 biology, computational, 116–17 Bird, Andrew, 121 Bitcoin, 279–88 China’s dominance of mining, 306–7 failure mode of, 317 fluctuation of value, 288 ledger for, 280–87 as model for larger economy, 296–97 recent troubles with, 305–7 and solutionism, 297 “Bitcoin: A Peer-to-Peer Electronic Cash System” (Nakamoto), 279 BlaBlaCar, 190–91, 197, 208 BlackBerry, 168, 203 Blitstein, Ryan, 117 blockchain as challenge to stacks, 298 and contracts, 291–95 development and deployment, 283–87 failure of, 317 and solutionism, 297 value as ledger beyond Bitcoin, 288–91 Blockchain Revolution (Tapscott and Tapscott), 298 Bloomberg Markets, 267 BMO Capital Markets, 204n Bobadilla-Suarez, Sebastian, 58n–59n Bock, Laszlo, 56–58 bonds, 131, 134 bonuses, credit card, 216 Bordeaux wines, 38–39 Boudreau, Kevin, 252–54 Bowie, David, 131, 134, 148 Bowie bonds, 131, 134 brand building, 210–11 Brat, Ilan, 12 Bredeche, Jean, 267 Brin, Sergey, 233 Broward County, Florida, 40 Brown, Joshua, 81–82 Brusson, Nicolas, 190 Burr, Donald, 177 Bush, Vannevar, 33 business conference venues, 189 Business Insider, 179 business processes, robotics and, 88–89 business process reengineering, 32–35 business travelers, lodging needs of, 222–23 Busque, Leah, 265 Buterin, Vitalik, 304–5 Byrne, Patrick, 290 Cairncross, Francis, 137 California, 208; See also specific cities Calo, Ryan, 52 Cambrian Explosion, 94–98 Cameron, Oliver, 324 Camp, Garrett, 200 capacity, perishing inventory and, 181 Card, David, 40 Care.com, 261 cars automated race car design, 114–16 autonomous, 17, 81–82 decline in ownership of, 197 cash, Bitcoin as equivalent to, 279 Casio QV-10 digital camera, 131 Caves, Richard, 23 Caviar, 186 CDs (compact discs), 145 cell phones, 129–30, 134–35; See also iPhone; smartphones Census Bureau, US, 42 central bankers, 305 centrally planned economies, 235–37 Chabris, Chris, 3 Chambers, Ephraim, 246 Champy, James, 32, 34–35, 37, 59 Chandler, Alfred, 309n Chase, 162 Chase Paymentech, 171 check-deposit app, 162 children, language learning by, 67–69 China Alibaba in, 7–8 concentration of Bitcoin wealth in, 306–7 and failure mode of Bitcoin, 317 mobile O2O platforms, 191–92 online payment service problems, 172 robotics in restaurants, 93 Shanghai Tower design, 118 Xiaomi, 203 Chipotle, 185 Choudary, Sangeet, 148 Christensen, Clay, 22, 264 Churchill, Winston, 301 Civil Aeronautics Board, US, 181n Civis Analytics, 50–51 Clash of Clans, 218 classified advertising revenue, 130, 132, 139 ClassPass, 205, 210 and economics of perishing inventory, 180–81 future of, 319–20 and problems with Unlimited offerings, 178–80, 184 and revenue management, 181–84 user experience, 211 ClassPass Unlimited, 178–79 Clear Channel, 135 clinical prediction, 41 Clinton, Hillary, 51 clothing, 186–88 cloud computing AI research, 75 APIs and, 79 Cambrian Explosion of robotics, 96–97 platform business, 195–96 coaches, 122–23, 334 Coase, Ronald, 309–13 cognitive biases, 43–46; See also bias Cohen, Steven, 270 Coles, John, 273–74 Collison, John, 171 Collison, Patrick, 171–74 Colton, Simon, 117 Columbia Record Club, 131 commoditization, 220–21 common sense, 54–55, 71, 81 companies continued dominance of, 311–12 continued relevance of, 301–27 DAO as alternative to, 301–5 decreasing life spans of, 330 economics of, 309–12 future of, 319–26 leading past the standard partnership, 323–26 management’s importance in, 320–23 markets vs., 310–11 as response to inherent incompleteness of contracts, 314–17 solutionism’s alternatives to, 297–99 TCE and, 312–15 and technologies of disruption, 307–9 Compass Fund, 267 complements (complementary goods) defined, 156 effect on supply/demand curves, 157–60 free, perfect, instant, 160–63 as key to successful platforms, 169 and open platforms, 164 platforms and, 151–68 and revenue management, 183–84 Stripe and, 173 complexity theory, 237 Composite Fund (D.


Industry 4.0: The Industrial Internet of Things by Alasdair Gilchrist

3D printing, additive manufacturing, Amazon Web Services, augmented reality, autonomous vehicles, barriers to entry, business intelligence, business process, chief data officer, cloud computing, connected car, cyber-physical system, deindustrialization, DevOps, digital twin, fault tolerance, global value chain, Google Glasses, hiring and firing, industrial robot, inflight wifi, Infrastructure as a Service, Internet of things, inventory management, job automation, low cost airline, low skilled workers, microservices, millennium bug, pattern recognition, peer-to-peer, platform as a service, pre–internet, race to the bottom, RFID, Skype, smart cities, smart grid, smart meter, smart transportation, software as a service, stealth mode startup, supply-chain management, trade route, undersea cable, web application, WebRTC, Y2K

That is a very simplistic example, but the point is if every part on the production line carries its identifier and a record of its own history then production decisions can be made intelligently during the manufacturing process. This enables customization of products during manufacturing, which can lead to profitable production of even lot sizes of one. Of course, there is a slight issue here, as business processes require a flow of tasks with the output from one task being the input of the next task. Traditionally, on a production line that would be relatively straightforward and a paper exercise. However, smart manufacturing and smart parts and products can influence the actions of the production line, which means the business processes become more complex. Business Processes Industrial Internet business processes will need to cater to parallel processing, real-time responses to process control, and collaborative machines (CPS) on the production line. This leads to automation of processes, which is ideal as that reduces overhead related to maintaining multiple ways to achieve the same result, for example separate lines for each version of the shampoo in the earlier example.

In addition, the smart office would provide a professional coffee machine—a machine that provides hot water 24/7. 21 22 Chapter 2 | Industrial Internet Use-Cases One of the goals of the IOT6 testbed was to provide a platform for testing and validating the interoperability among the various of-the-shelf sensors and protocols and the conceptual architecture of the Industrial Internet of Things. They were determined to interconnect and test wherever possible multiprotocol interoperability with real devices through all the possible different couplings of protocols (among the selected standards). Also, they wanted to test and demonstrate various innovative Internet-based application scenarios related to the Internet of Things, including business processes related scenarios. In addition, they planned to test and demonstrate the potential of the multi-protocol card, IPv6 proxy’s for non-IP devices, and estimate the potential scalability of the system. Furthermore, they would deploy and validate the system in a real testbed environment with real end users in order to test the various scenarios. The four scenarios tested were: • The first scenario involved the building maintenance process, which is the process of integrating IPv6 with standard IoT building control devices, mobile phones, cloud services, and building management applications

There are many industrial systems deployed today that are interconnected (M2M) and they combine a mixture of sensors, actuators, logic components, and networks to allow them to interconnect and to function. The difference with the Industrial Internet approach is that these industrial systems (ISs) will become Industrial Internet systems (IISs) as they become connected to the Internet and integrate with enterprise systems, for the purpose of enhanced business process flow and analysis. The IISs will provide operational data via its sensors to enterprise back-end systems for advanced data processing and cloud-based advanced historical and predicative analytics. The advanced cloud services will drive optimized decision-making and operational efficiencies and facilitate the collaboration between autonomous industrial control systems. To realize these goals, IISs require a standard-based, open and widely applicable architectural framework.


pages: 458 words: 135,206

CTOs at Work by Scott Donaldson, Stanley Siegel, Gary Donaldson

Amazon Web Services, bioinformatics, business intelligence, business process, call centre, centre right, cloud computing, computer vision, connected car, crowdsourcing, data acquisition, distributed generation, domain-specific language, glass ceiling, orbital mechanics / astrodynamics, pattern recognition, Pluto: dwarf planet, QR code, Richard Feynman, Ruby on Rails, shareholder value, Silicon Valley, Skype, smart grid, smart meter, software patent, thinkpad, web application, zero day, zero-sum game

Donaldson: In your career path toward becoming a CTO, what have you found that captures your imagination and curiosity the most? Kaplow: So there's technology for technology's sake, right? This is the one-hand-clapping problem. But what really intrigues me is how to manage the technical business process. How do you work with people and organizations to get them to use new technology? How do you help the technical business process move forward to help the client manage the change required to incorporate technology or change the business processes that they're using to deploy technology or provide services? So that's where a lot of the teaching role and the mentoring skills come into play. In a lot of cases it's sort of a force-of-wills thing, especially in the position I'm in now, because I'm not a government employee.

All of that is pulled together and the patterns are recognized. Donaldson: That's an interesting point—there's an enormous amount of data and information that you're collecting. The process by which you synthesize that into something and distill it into something is bite-sizable. Are there special technologies that you're supporting to do that or is it more of a business process procedure supported with run-of-the-mill-type technology to do that? Hrelic: It's a combination of both. If the business processes are not right or are broken, no technology is going to make it work. So we try to look for technologies that make it easier, but it's a constant battle, and it's very difficult, especially since we're talking about traditional publishing, which is writing and a combination of voice and video. I mean, these are all data or information that we have.

We call it the architecture technical review. We did that in IBM. When I became an IBM Fellow, I moved up and was the chief architect for the IBM Software Group as a whole. About two days after that, I get called in to review a project to build a B2B (business to business) system based on WebSphere and Software Group products. It took 14 physical machines to build and run the “Hello World” business process. I didn't know what the right answer was, but I knew it was less than 14. When I left, it would all run on a ThinkPad. It was a big ThinkPad, but it would all run on a ThinkPad. And that was all just advice and consent, and the fact that when I gave advice and consent, my technical colleagues would hash it out and figure out how to do it; then it was game time. Let's go and let's do it. S.


pages: 209 words: 80,086

The Global Auction: The Broken Promises of Education, Jobs, and Incomes by Phillip Brown, Hugh Lauder, David Ashton

active measures, affirmative action, barriers to entry, Branko Milanovic, BRICs, business process, business process outsourcing, call centre, collective bargaining, corporate governance, creative destruction, credit crunch, David Ricardo: comparative advantage, deindustrialization, deskilling, disruptive innovation, Frederick Winslow Taylor, full employment, future of work, glass ceiling, global supply chain, immigration reform, income inequality, industrial cluster, industrial robot, intangible asset, job automation, Joseph Schumpeter, knowledge economy, knowledge worker, low skilled workers, manufacturing employment, market bubble, market design, neoliberal agenda, new economy, Paul Samuelson, pensions crisis, post-industrial society, profit maximization, purchasing power parity, QWERTY keyboard, race to the bottom, Richard Florida, Ronald Reagan, shared worldview, shareholder value, Silicon Valley, sovereign wealth fund, stem cell, The Bell Curve by Richard Herrnstein and Charles Murray, The Wealth of Nations by Adam Smith, Thomas L Friedman, trade liberalization, transaction costs, trickle-down economics, winner-take-all economy, working poor, zero-sum game

This was in 2002, when the company began engaging in a number of pilot projects in response to increasing cost pressures. The experiment with back-office functions reflected the growth in offshore call centers and business process outsourcing (BPO). There was little point using staff in New York or London to process invoices or very basic data-entry jobs when it could be done in real time in India or Vietnam at a fraction of the price. Although the company was in the early stages of developing wealth management and investment banking within the country, there was rapid growth of the middle office that includes research and analytical jobs for its New York and London offices. “For five analysts in New York or London, you could have at least fifteen in India.” Before 2000, business process and analytical work were done close to the main business centers, but with the rapid development of Internet capability, secure networks, and standardized software, they have drawn a clearer distinction between work and place.

This differential has disappeared as workers are forced into a reverse auction in a desperate bid to keep their jobs.10 For entry-level jobs in Detroit’s auto industry, workers previously earning $28 an hour are now on $14 an hour.11 The Competition for Profit The quality-cost revolution was initially driven by American, European, and Japanese corporations, but it led to new forms of low-cost innovation increasingly driven by Chinese and Indian companies. In much the same way that workers in emerging economies were assumed to lag far behind on the evolutionary path to knowledge work, Chinese and Indian companies were also assumed to stand little chance of competing against the technological superiority of American enterprise. Yet Chinese and Indian companies are using state-of-the-art technologies, business processes, and management techniques combined with The Quality-Cost Revolution 55 low-cost innovation strategies that enable them to compete for profits with American corporations for the full length of the value chain. The growing capacity of companies from emerging economies to move up the value chain and compete in world markets was described by an Indian executive working for an American consultancy company.

Digital Taylorism has given companies a powerful tool for employee surveillance and remote control to compare the performance of plants, offices, suppliers, managers, and workers located anywhere in the world. Its application has become more widespread with consequences for employees in a wide range of industries and occupations. The Industrialization of Knowledge Work Leading consultancy companies are playing an important role in applying digital Taylorism to a range of service industries, including retail, health, and finance, that typically focus on business processes, including receiving orders, marketing services, selling products, delivering 74 The Global Auction services, distributing products, invoicing for services, and accounting for payments. Digital Taylorism enables innovation to be translated into routines that might require some degree of education but not the kind of creativity and independence of judgment often associated with the knowledge economy.


Reactive Messaging Patterns With the Actor Model: Applications and Integration in Scala and Akka by Vaughn Vernon

A Pattern Language, business intelligence, business process, cloud computing, cognitive dissonance, domain-specific language, en.wikipedia.org, fault tolerance, finite state, Internet of things, Kickstarter, loose coupling, remote working, type inference, web application

I think there are two primary ways to implement a Process Manager. One way is to create a domain-specific language (DSL) and interpreter. The DSL is itself the high-level programming language that allows you to describe the rules of various business processes. One such language is Business Process Execution Language (BPEL), and there are several tools available that read, interpret, and manage business processes that are defined with it. When using such an approach, the Process Manager itself cannot be a core part of your process definition because the interpreter must be able to manage a wide range of business processes. That kind of Process Manager is not specific to your business domain. In other words, the Process Manager itself is highly reusable, in a similar way as any high-level programming language compiler/interpreter.

See Reactive applications routing complex application processes, 23 why software development is hard, 1–5 Architectural routers, 228 Artificial intelligence, reactive systems used by, 7 Asynchronous messaging, characteristics of actors and actor systems, 13–14 At-least-once delivery in Guaranteed Delivery, 177, 179–183 Transactional Client/Actor and, 353 At-most-once delivery purging messages and, 414 Transactional Client/Actor and, 353 Atomic Scala (Eckel and Marsh), 29 Authenticator filter, 136, 138 Availability, trade-off with consistency, 115–116 Await conditions, in Dynamic Router example, 239–240 B Backpressure, reducing demand on cluster-aware routers, 98–99 BalancingDispatcher, standard Akka dispatchers, 375 Batch-Receiver, Message Sequence and, 218 Batch-Sender, Message Sequence and, 218 BDD (Behavior-Driven Development), 101–102 Behavioral tests, 101–102 Behavior-Driven Development (BDD), 101–102 Body, message parts, 130 Bottlenecks, Message Brokers and, 309 Bounded Context, Domain-Driven Design (DDD), 334, 345 BoundedMailbox, 411 BPEL (Business Process Execution Language), 292 Bridges. See Message Bridges Bus. See Message Bus Business Process Execution Language (BPEL), 292 C C# actors, 420–425 Dotsero toolkit for, 417 C++, Smalltalk compared with, 29 Cache, CPU, 107, 111–112 Canonical Data Models Message Bus and Message Broker dependence on, 310 uses of, 333–334 Canonical Message Model actor systems requiring a canon, 335–336 case classes, 131–132, 134 defined, 313–314 Message Bus interface for services sharing, 192–193 overview of, 333–335 TradingBus and, 194–198 CAP theorem (Brewer), 115–116 Case classes Canonical Message Model, 131–132 in defining message types, 42 local event stream of Publish-Subscribe Channel, 156–158 matching, 133–134 in Recipient List example, 247 Scala tutorial, 39–40 Catchall actor, in Dynamic Router example, 240 Causal consistency, 402, 405 Channel Adapters data format translation and, 310 Message Bus and, 192 Message Envelope as, 313 overview of, 183–185 packing/unpacking trading messages, 135 translating data, 143 Channel Purger defined, 393 example, 414–415 overview of, 414 Channels.

Enterprise Applications The software applications needed by organizations to run their day-to-day operations are broad and varied. Depending on the kind of business, you can anticipate some of the required application software. Do any of the following application categories overlap with your enterprise? Accounting, Accounts (Financial and others), Aerospace Systems Design, Automated Trading, Banking, Budgeting, Business Intelligence, Business Process, Claims, Clinical, Collaboration, Communications, Computer-Aided Design (CAD), Content/Document Management, Customer Relationship Management, Electronic Health Record, Electronic Trading, Engineering, Enterprise Resource Planning, Finance, Healthcare Treatment, Human Resource Management, Identity and Access Management, Invoicing, Inventory, IT and Datacenter Management, Laboratory, Life Sciences, Maintenance, Manufacturing, Medical Diagnosis, Networking, Order Placement, Payroll, Pharmaceuticals, Publishing, Shipping, Project Management, Purchasing Support, Policy Management, Risk Assessment, Risk Management, Sales Forecasting, Scheduling and Appointment Management, Text Processing, Time Management, Transportation, Underwriting However incomplete the list, much of this software can be acquired as licensed commodities.


The Art of Scalability: Scalable Web Architecture, Processes, and Organizations for the Modern Enterprise by Martin L. Abbott, Michael T. Fisher

always be closing, anti-pattern, barriers to entry, Bernie Madoff, business climate, business continuity plan, business intelligence, business process, call centre, cloud computing, combinatorial explosion, commoditize, Computer Numeric Control, conceptual framework, database schema, discounted cash flows, en.wikipedia.org, fault tolerance, finite state, friendly fire, hiring and firing, Infrastructure as a Service, inventory management, new economy, packet switching, performance metric, platform as a service, Ponzi scheme, RFC: Request For Comment, risk tolerance, Rubik’s Cube, Search for Extraterrestrial Intelligence, SETI@home, shareholder value, Silicon Valley, six sigma, software as a service, the scientific method, transaction costs, Vilfredo Pareto, web application, Y2K

D EFEATING THE C ORPORATE M INDSET Defeating the Corporate Mindset Lots of companies claim that technology is a key differentiator, critical to the business, or in military lingo, a force multiplier, but the reality is that many of them, including Software as a Service (SaaS) companies, treat technology as a support service. There are two basic forms that a technology organization can take within a business. One is to be a support service where technology supports the business processes of manufacturing, sales, or any number of other business lines. The other form that technology can take within a business is to be the product for the business, such as with SaaS, infrastructure as a service (IaaS), hardware product companies, or Web 2.0 companies. Being a support service and supporting other key business processes is a fine calling. As a technologist, being the product that the business is founded around, while often more stressful, is great as well. The terms usually applied to these are cost center for the support service and profit center for the product development organizations.

., 49, 429 Brooks’ Law, 429 Buffers, vs. caches, 378 Build grids, 462–463 Build steps, check list, 463 Building components vs. buying architectural principles, 203 being the best, 236 case study, 240–242 I NDEX competitive components, identifying, 239 cost effectiveness, 239–240 cost-focused approach, 234–235, 237–240 creating strategic competitive differentiation, 238 decision checklist, 238–240 effects on scalability, 233–234 “not built here” phenomenon, 236–237 ownership, pros and cons, 238–239 strategy-focused approach, 235–236, 237–240 TAA conflicts, 305 TAD, checklist, 304 TAD conflicts, 305 Bureaucracy, effect on business processes, 130 Business acumen, balancing with technical, 28–29 Business case for scale. See also Corporate mindset, changing. Amazon outage example, 116 customer acquisition costs, 116 downtime costs, 114–117 intraorganizational costs, 116–117 lost customers, 116 Business change calendar, 175 Business growth rate, determining headroom, 186–187 Business metrics, monitoring, 476–477 Business processes. See also Standards; specific processes. bureaucracy, 130 capability levels, 125, 126–128 CMM (Capability Maturity Model), 124–125 CMMI (Capability Maturity Model Integrated), 124–125 complexity, managing, 128–130 continuous process improvement, 178–179 culture clash, 130 definition, 122 effects on creativity, 123–124 excessive mundane work, 127 feedback from teams, 131 maturity levels, 125, 126–127 need for improvement, warning signs, 127 periodic maintenance, 131 problem causes, 130 problems, avoiding, 131 purpose of, 122–124 repeatability, 126–128 repetitive management, same task, 127 resolving procedural uncertainty, 123 rigor, 126–128 same task, multiple procedures, 127 standardization, 123 Business unit owners, roles and responsibilities, 27 Buy when non core, architectural principles, 203 C Cache ratio, 379 Cache-hits, 379 Cache-miss, refreshing caches, 379–381 Cache-misses, 379 Caches adding data, 382 batch cache refresh, 379–381 vs. buffers, 378 cache ratio, 379 cache-hits, 379 cache-misses, 379 CDNs (content delivery networks), 389–390 datum, 378 definition, 378 get method, 382 hit ratio, 379 marshalling, 381 memcached, 382 object, 381–384 reading from, 379 retrieving data, 382 structure of, 378 tags, 378 unmarshalling, 381 updating.

See also AKF Scale Cube for applications. requestor or customer, 333–334, 344–347 resources, 331–332 services, 331–332 Srivastava, Amitabh, 46 Stability, definition, 165 Staffing for scalability. See also Leadership; Management; Organizational design; Teams. adding/removing people, 12, 13 importance of people, 10–11 Stakeholders, organizing to match their interests, 13 Standardization, business processes, 123 Standards, organizational design influences on, 44–45. See also Business processes. State within applications, AKF Scale Cube, 335 defining, 401 saving, 403–404 Stateless systems, architectural principles, 202, 206–207 Status communications, crisis management, 160–161 Storage costs of data backup storage, 413 initial cost of storage, 412–413 Strategic advantage value of data, 415, 416–417 Strategic competitive differentiation, building components vs. buying, 238 Strategy-focused approach, building components vs. buying, 235–236, 237–240 Strength, weaknesses, opportunities, threats (SWOT) analysis, 82 555 556 I NDEX Stress testing analyzing data, 268 bottlenecks, identifying, 266 checklist of steps, 268–269 criticality of services, ranking, 265 data collection, 267 definition, 264 drawbacks, 269 environment, creating, 266 establishing a baseline, 265 executing tests, 267 failure, testing, 265 goals of, 264–265 interactivity of system services, 265 key services, identifying, 265 monitors, identifying, 267 negative testing, 264, 265 objectives, identifying, 264–265 positive testing, 264 recoverability, testing, 265 for scalability, 270–271 service behavior during failure, 265 services affecting performance, identifying, 265 simulating a load, 267 system interactions, negative, 265 Structured programming, 402 Sun Grid Engine, 429 Support persons, RASCI, 38 Support services business, 109–110 Swapping, excessive, 190 Swim lanes along natural barriers, 320–321 by the biggest sources of incidents, 320 by customer boundaries, 312–313 definition, 310, 311 isolating the money-maker, 320 by service boundaries, 313–314 splitting.


pages: 346 words: 97,330

Ghost Work: How to Stop Silicon Valley From Building a New Global Underclass by Mary L. Gray, Siddharth Suri

Affordable Care Act / Obamacare, Amazon Mechanical Turk, augmented reality, autonomous vehicles, barriers to entry, basic income, big-box store, bitcoin, blue-collar work, business process, business process outsourcing, call centre, Capital in the Twenty-First Century by Thomas Piketty, cloud computing, collaborative consumption, collective bargaining, computer vision, corporate social responsibility, crowdsourcing, data is the new oil, deindustrialization, deskilling, don't be evil, Donald Trump, Elon Musk, employer provided health coverage, en.wikipedia.org, equal pay for equal work, Erik Brynjolfsson, financial independence, Frank Levy and Richard Murnane: The New Division of Labor, future of work, gig economy, glass ceiling, global supply chain, hiring and firing, ImageNet competition, industrial robot, informal economy, information asymmetry, Jeff Bezos, job automation, knowledge economy, low skilled workers, low-wage service sector, market friction, Mars Rover, natural language processing, new economy, passive income, pattern recognition, post-materialism, post-work, race to the bottom, Rana Plaza, recommendation engine, ride hailing / ride sharing, Ronald Coase, Second Machine Age, sentiment analysis, sharing economy, Shoshana Zuboff, side project, Silicon Valley, Silicon Valley startup, Skype, software as a service, speech recognition, spinning jenny, Stephen Hawking, The Future of Employment, The Nature of the Firm, transaction costs, two-sided market, union organizing, universal basic income, Vilfredo Pareto, women in the workforce, Works Progress Administration, Y Combinator

People hired through contract staffing companies like Leapforce worked on EWOQ, identifying and ranking new webpages to fine-tune links between ads and users’ search queries.22 According to press accounts and people we interviewed and surveyed who work on multiple on-demand platforms, Twitter and Facebook use internal tool kits that function much like MTurk and plug VMS-provided workers into their platforms to monitor and review content.23 Kala does similar tasks on UHRS for Microsoft. Before Kala started doing ghost work on UHRS, she worked for a small company that processed back office files from a U.S. business. Her company, one of many so-called business process outsourcing (BPO) shops handling work from the United States, was located in the heart of Bangalore’s Electronic City neighborhood, not far from tourist-choked Cubbon Park.24 Perhaps it is ironic that the company’s biggest contract was with one of the oldest and largest labor organizations based in the United States. Kala and three other women sat shoulder to shoulder in the BPO shop’s cramped four-desk office and did small tasks like deleting duplicates and fixing typos in data entries and updating the labor organization’s contact database.

This is why, in Indian cities that lack free public utilities like tap water and sewer systems, there are high-speed broadband internet infrastructure and power grids to feed technology parks. The sharp growth in readily available internet connections, combined with a native English-speaking workforce and its long history of advanced educational training centers in science and engineering, made India the first epicenter of business process outsourcing (BPO). But outsourcing was never simply about cost cutting. It was also about the growing resistance to unionization and evading long-standing labor regulations. As companies expanded their reliance on a far-flung network of contingent staff, they shrank the number of on-site, full-time employees who were eligible to collectively bargain or to push for increasing workers’ benefits.

The first was the need to spend hours wading and sorting through spam or suspicious offers for “at-home work,” searching for legitimate work on a legitimate platform. Because there are no legal requirements screening who posts work to on-demand marketplaces, workers had to make sure they weren’t signing up to a site that was simply looking to harvest their email address or that would open them up to identity theft. Lijo, 24, works for a business processing organization and lives in Bangalore, India. He learned about MTurk from a flyer stapled to a tree. He called the number, and the person who answered told him an account on the platform cost 1,000 rupees (almost $14). Unaware that registration on MTurk was actually free, Lijo negotiated the price down to 600 rupees ($8.25)—all he could afford at that time—and bought an account. The person explained the basics of how to use MTurk, but once Lijo was on his own, he quickly got confused.


pages: 525 words: 142,027

CIOs at Work by Ed Yourdon

8-hour work day, Apple's 1984 Super Bowl advert, business intelligence, business process, call centre, cloud computing, crowdsourcing, distributed generation, Donald Knuth, Flash crash, Googley, Grace Hopper, Infrastructure as a Service, Innovator's Dilemma, inventory management, Julian Assange, knowledge worker, Mark Zuckerberg, Nicholas Carr, rolodex, shareholder value, Silicon Valley, six sigma, Skype, smart grid, smart meter, software as a service, Steve Ballmer, Steve Jobs, Steven Levy, the new new thing, the scientific method, WikiLeaks, Y2K, Zipcar

I’m going back a decent period of time, but that product is still there on the marketplace. It was built in a very agile manner, with customers in the same room. Locked into helping drive deliverables, literally cutting a version of the product every day. In about nine months, we built a product that was the ERP for the travel agencies business process, the ability to take your reservation, process it on the GDS in the back end. And then provide you with all the services you required. I came into the business process side at American and very quickly was noticed as somebody who understood technology but also understood business process. I was starting to manage teams as a whole, but more importantly, I understood what the customer wanted. And we were able to translate that into the requirements, or the user stories, as you call them today, in agile terms, for what needed to be built.

Part of that, of course, includes making the IT department itself more efficient, productive, and competitive by accomplishing more work with fewer people, and by carrying out system development projects in a fashion that's consistently on-time, under-budget, and free of the software bugs that drive everyone crazy. And because computer hardware is still an expensive part of the IT budget, CIOs are looking more and more closely at the benefits of virtualization and cloud computing—indeed, those technologies are a “done deal” in the majority of organizations that I interviewed. But simply making existing business processes more productive and efficient is apparently not as exciting as it once was. After all, business organizations have been using computers, for almost 50 years now, to make the number-crunching, paper-pushing, mundane operational activities of the organization less time-consuming and expensive. There is always more that can be done, of course, but the main emphasis today seems to be shifting the IT emphasis from inside the organization to outside the organization—to connect the organization's employees, processes, and data more intimately to the consumers, suppliers, partners, and other organizations with which the business interacts.

We are strictly regulated, more so than the FSA1 on what you can and cannot do and what we’re required to do as well. We cannot always do what another retailer can do. So it’s just a fascinating space, because we are in the Web 3.0 business in that our customers are already watching media, socially interacting in-store, and buying product. It’s now about how do you make the technology—the technology’s come alive for the segment—how do you then apply it effectively to the business processes you already have? Yourdon: One of the things that you just said intrigued me, in terms of being aware of a customer profile. Obviously, there’s a real-time aspect to that too—but how fast would my profile change and to what extent can you anticipate my future profile and perhaps offer me opportunities or games or transactions that I might not have thought about on my own? Sridhara: That’s what I call “more ‘e’ than Amazon,” as a tagline.


pages: 98 words: 25,753

Ethics of Big Data: Balancing Risk and Innovation by Kord Davis, Doug Patterson

4chan, business process, corporate social responsibility, crowdsourcing, en.wikipedia.org, longitudinal study, Mahatma Gandhi, Mark Zuckerberg, Netflix Prize, Occupy movement, performance metric, Robert Bork, side project, smart grid, urban planning

But even though it is simple and easy to fix that gap in customer’s understanding, that fear of the unknown risk creates a barrier to conversion that all organizations are familiar with. Making it too easy to opt out can easily be seen as detrimental to both the consumer and the business model. Even understanding the temptation to choose the path of least resistance in order to support specific business models, designing and implementing business processes and tools to make it less likely or more difficult for people to opt out begs the question of what values are motivating the choice of which model to implement. Which value is most important: acknowledging and respecting people’s fear of the unknown risk and honoring their interest in reducing it, or making it slightly more difficult to support a business model? These value questions become increasingly important as the evolution of big data unfolds.

The question remains open, however, of the exact distinction between “personal information” and the set of all information that Google knows about you, which, when combined in the right way, could potentially expose enormous amounts of personal information. The tacit agreements we enter into as individuals with organizations who have access to vast amounts of personal data generate more risk than making those agreements explicit and easily understood and accessible. Manifestation of Values In many ways, an organization’s business processes, technical infrastructure configuration, and data-handling procedures can be interpreted as a manifestation of their values.[5] Seen this way, values are inherently expressed by these data-handling practices. Although it might not be completely possible to reverse-engineer a company’s values by deconstructing their data-handling practices, it certainly is possible to learn more about what has been considered important enough to include by simply reading the policy statement.

This analysis can be more complex for an established organization than it is for a proposed startup (which typically do not, it is fair to assume, have mature plans for unintended consequences or employee failures to act in accordance with company policy). Big-data startups can exploit an advantage here. By understanding core values in advance of building out their operational processes and technology stack, they can actually take action to build their values directly into their infrastructure. In some ways, an organization’s technology configuration, business processes, and data-handling practices can be viewed as a physical manifestation of their values. General topic themes are a good start. As a reminder, many organizations already have mature business capabilities that can contribute much to inquiry and analysis. Compliance, human resources, legal, finance and accounting, data architecture, technology and product planning, and marketing all have unique and informed perspectives.


Demystifying Smart Cities by Anders Lisdorf

3D printing, artificial general intelligence, autonomous vehicles, bitcoin, business intelligence, business process, chief data officer, clean water, cloud computing, computer vision, continuous integration, crowdsourcing, data is the new oil, digital twin, distributed ledger, don't be evil, Elon Musk, en.wikipedia.org, facts on the ground, Google Glasses, income inequality, Infrastructure as a Service, Internet of things, Masdar, microservices, Minecraft, platform as a service, ransomware, RFID, ride hailing / ride sharing, risk tolerance, self-driving car, smart cities, smart meter, software as a service, speech recognition, Stephen Hawking, Steve Jobs, Steve Wozniak, Stuxnet, Thomas Bayes, Turing test, urban sprawl, zero-sum game

To reach back to the introduction of this book: this is an example of how the smart city landscape today is built according to “the Way of the Pack Donkey” following the path of least resistance and little or no central planning and coordination. Another reason for this lack of central governance and control of IoT implementations is a skill gap in central technology organizations. A central technology organization in a city is typically an IT department. They were built at a time when computing and digitalization of business processes were expanding and are focused on core traditional technology initiatives like running a data center, providing computers to employees, and developing and maintaining information systems like financial and HR systems. Very little of this work can be generalized or reused when faced with a device that has its very own unique and peculiar way of functioning. No wonder that implementations are primarily made by specialized contractors.

Data is always created by a system somehow, but the process and nature of that system has an impact on the data and how it needs to be integrated, stored, and managed. Systems of record A system of record is a system that serves as the authoritative source of information for its particular type of information. An example could be a payroll system, which serves as the authoritative source of who gets what in salary at what time and why. A system of record is used to manage business processes that the city is responsible for like social services, education, permits, HR, taxes, and so on. These are the backbone of the city and determine how it runs and are often also characterized as mission-critical applications because they need to run in order for the city to work. If a payroll system is down, it better be up and running smoothly come pay day; otherwise, city employees will go home, and important city functions will shut down.

This model is well suited for engagements where learning is the main focus such as demos and POCs. Often vendors will also sponsor various kinds of training, which is another important way for the city to learn about new technologies. The vendor-sponsored engagements should be clearly delimited in terms of solution and time. If the engagement becomes one where a solution is offered and continues to be used for real business processes without an endpoint, it should be a cause for concern. Depending on the extent of the collaboration, it may also be a good idea to have a legal agreement on IP and NDAs in place. Public-private partnerships – Sometimes vendors or other private organizations take the collaboration to a higher level than the vendor sponsored. This is a special case that has a lot of potential for cities to develop new innovative solutions.


pages: 996 words: 180,520

Nagios: System and Network Monitoring, 2nd Edition by Wolfgang Barth

business process, Chuck Templeton: OpenTable:, Debian, en.wikipedia.org, Firefox, RFC: Request For Comment, web application

Eventually, the status with the highest priority wins out: CRITICAL trumps WARNING, trumps UNKNOWN, trumps OK. The definition and use of expressions is explained in 8.5.7 Simple business process monitoring from page 199. -c ausdruck / --critical=expression If the expression is true, the status is set to CRITICAL. Eventually, the status with the highest priority wins out (see --warning and 8.5.7 Simple business process monitoring). -u expression / --unknown=expression If the expression is true, the status UNKNOWN is set. The status with the highest priority (see --warning and 8.5.7 Simple business process monitoring) wins out. -o expression / --ok=expression If ausdruck is true, the status OK is set. Here the status with the highest priority also wins out (see --warning and 8.5.7 Simple business process monitoring). -v / --verbose This increases the verbosity of the plugin for debugging purposes.

-f /etc/nagios/check_multi/homeoffice.cmd -n homeoffice -r 31 ... } If the mapping of business processes with check_multi isn't enough for you, you should take a look at the somewhat more complex addon Nagios Business Process View and Nagios Business Impact Analysis from the Sparda-Datenverarbeitung eG, Nuremberg, Germany, which is available on the Nagios-Exchange.[91] In contrast to check_multi, which appears as the only Nagios service and which also needs to be managed only once by Nagios, this addon uses services already defined in Nagios, which means that Nagios performs each individual check as usual. It retrieves the results of individual checks, links these, and displays them on its own Web interface. When doing so, the result of such links—business processes, so to speak—can be redefined in Nagios as a separate service so that it is possible, for instance, to use the notification logic of Nagios.

In addition, check_multi now also provides performance data referring to the overall processing: |MULTI::check_multi::plugins=5 time=0.18 net_ping::check_icmp::rta=0.048 ms; 500.000;1000.000;0; pl=0%;5;10;; system_ntp::check_ntp::offset=0.0022 66s;60.000000; 120.000000; First check_multi announces that it has called 5 plugins and has used a total of 0.18 seconds for processing. This is followed by the performance data for the other plugins, each supplemented with the service description and plugin name. If a plugin issues more than one variable, the service description and plugin name are not repeated. 8.5.7 Simple business process monitoring In order to evaluate business processes, you generally want to know whether a particular process is working—for instance, whether or not a customer can perform online banking. Individual pieces of information on all hosts and services involved are not relevant from this perspective and are also not always useful if systems are designed redundantly in different forms. Figure 8-2. For the terminal server farm to be reachable from the Internet, an OpenVPN access and a terminal server must be available.


pages: 339 words: 88,732

The Second Machine Age: Work, Progress, and Prosperity in a Time of Brilliant Technologies by Erik Brynjolfsson, Andrew McAfee

"Robert Solow", 2013 Report for America's Infrastructure - American Society of Civil Engineers - 19 March 2013, 3D printing, access to a mobile phone, additive manufacturing, Airbnb, Albert Einstein, Amazon Mechanical Turk, Amazon Web Services, American Society of Civil Engineers: Report Card, Any sufficiently advanced technology is indistinguishable from magic, autonomous vehicles, barriers to entry, basic income, Baxter: Rethink Robotics, British Empire, business cycle, business intelligence, business process, call centre, Charles Lindbergh, Chuck Templeton: OpenTable:, clean water, combinatorial explosion, computer age, computer vision, congestion charging, corporate governance, creative destruction, crowdsourcing, David Ricardo: comparative advantage, digital map, employer provided health coverage, en.wikipedia.org, Erik Brynjolfsson, factory automation, falling living standards, Filter Bubble, first square of the chessboard / second half of the chessboard, Frank Levy and Richard Murnane: The New Division of Labor, Freestyle chess, full employment, G4S, game design, global village, happiness index / gross national happiness, illegal immigration, immigration reform, income inequality, income per capita, indoor plumbing, industrial robot, informal economy, intangible asset, inventory management, James Watt: steam engine, Jeff Bezos, jimmy wales, job automation, John Markoff, John Maynard Keynes: Economic Possibilities for our Grandchildren, John Maynard Keynes: technological unemployment, Joseph Schumpeter, Kevin Kelly, Khan Academy, knowledge worker, Kodak vs Instagram, law of one price, low skilled workers, Lyft, Mahatma Gandhi, manufacturing employment, Marc Andreessen, Mark Zuckerberg, Mars Rover, mass immigration, means of production, Narrative Science, Nate Silver, natural language processing, Network effects, new economy, New Urbanism, Nicholas Carr, Occupy movement, oil shale / tar sands, oil shock, pattern recognition, Paul Samuelson, payday loans, post-work, price stability, Productivity paradox, profit maximization, Ralph Nader, Ray Kurzweil, recommendation engine, Report Card for America’s Infrastructure, Robert Gordon, Rodney Brooks, Ronald Reagan, Second Machine Age, self-driving car, sharing economy, Silicon Valley, Simon Kuznets, six sigma, Skype, software patent, sovereign wealth fund, speech recognition, statistical model, Steve Jobs, Steven Pinker, Stuxnet, supply-chain management, TaskRabbit, technological singularity, telepresence, The Bell Curve by Richard Herrnstein and Charles Murray, The Signal and the Noise by Nate Silver, The Wealth of Nations by Adam Smith, total factor productivity, transaction costs, Tyler Cowen: Great Stagnation, Vernor Vinge, Watson beat the top human players on Jeopardy!, winner-take-all economy, Y2K

The rate of patenting by American inventors has been increasing rapidly since the 1980s,19 and other types of intellectual assets have also grown.20 In addition, a lot of research and development (R&D) is never formalized as intellectual property but is still very valuable. The second—and even larger—category of intangibles is organizational capital like new business processes, techniques of production, organizational forms, and business models. Effective uses of the new technologies of the second machine age almost invariably require changes in the organization of work. For instance, when companies spend millions of dollars on computer hardware and software for a new enterprise resource planning system, they typically also include process changes that are three to five times as costly as the original investments in hardware and software. Yet, while the hardware and software spending generally shows up as additions to the nation’s capital stock, the new business processes, which often outlast the hardware, are generally not counted as capital. Our research suggests that a correct accounting for computer-related intangible assets would add over $2 trillion to the official estimates of the capital assets in the United States economy.21 User-generated content is a smaller but rapidly growing third category of intangible assets.

The key to understanding this pattern is the realization that, as discussed in chapter 5, GPTs always need complements. Coming up with those can take years, or even decades, and this creates lags between the introduction of a technology and the productivity benefits. We’ve clearly seen this with both electrification and computerization. FIGURE 7.2 Labor Productivity in Two Eras Perhaps the most important complementary innovations are the business process changes and organizational coinventions that new technologies make possible. Paul David, an economic historian at Stanford University and the University of Oxford, examined the records of American factories when they first electrified and found that they often retained a similar layout and organization to those that were powered by steam engines.9 In a steam engine–driven plant, power was transmitted via a large central axle, which in turn drove a series of pulleys, gears, and smaller crankshafts.

But due in part to the power of digitization and networks to speed the diffusion of ideas, complementary innovations are happening faster than they did in the first machine age. Less than ten years after its introduction, entrepreneurs were finding ways to use the Web to reinvent publishing and retailing. While less visible, the large enterprise-wide IT systems that companies rolled out in the 1990s have had an even bigger impact on productivity.10 They did this mainly by making possible a wave of business process redesign. For example, Walmart drove remarkable efficiencies in retailing by introducing systems that shared point-of-sale data with their suppliers. The real key was the introduction of complementary process innovations like vendor managed inventory, cross-docking, and efficient consumer response that have become staple business-school case studies. They not only made it possible to increase sales from $1 billion a week in 1993 to $1 billion every thirty-six hours in 2001, but also helped drive dramatic increases in the entire retailing and distribution industries, accounting for much of the additional productivity growth nationwide during this period.11 IT investment soared in the 1990s, peaking with a surge of investment in the latter half of the decade as many companies upgraded their systems to take advantage of the Internet, implement large enterprise systems, and avoid the much-hyped Y2K bug.


The Future of Technology by Tom Standage

air freight, barriers to entry, business process, business process outsourcing, call centre, Clayton Christensen, computer vision, connected car, corporate governance, creative destruction, disintermediation, disruptive innovation, distributed generation, double helix, experimental economics, full employment, hydrogen economy, industrial robot, informal economy, information asymmetry, interchangeable parts, job satisfaction, labour market flexibility, Marc Andreessen, market design, Menlo Park, millennium bug, moral hazard, natural language processing, Network effects, new economy, Nicholas Carr, optical character recognition, railway mania, rent-seeking, RFID, Silicon Valley, Silicon Valley ideology, Silicon Valley startup, six sigma, Skype, smart grid, software as a service, spectrum auction, speech recognition, stem cell, Steve Ballmer, technology bubble, telemarketer, transcontinental railway, Y2K

In the old days, says Tony Scott, chief technology officer at General Motors, computer systems were used only internally, and managing who was allowed to do what was simple. But with the recent proliferation of systems, and a greater reliance on suppliers and outsourcing, the 68 SECURING THE CLOUD number of users who may need access to a company’s systems has grown rapidly. “On top of that, most modern companies now have their actual business processes deeply embedded in their systems,” he says. Indeed, their business processes are the systems. According to Mr Scott, “All these forces working together create a huge problem. Who is accessing these systems, and how can I manage it?” One outfit offering solutions to this identity-management problem is Silicon-Valley-based Oblix. Its software sits between users and a company’s existing software systems (accounts, inventory, e-mail, and so on).

Financial markets can change very rapidly, so a project begun in 2000 to increase the capacity to process Nasdaq trades, for example, no longer makes much sense today. Schneider National goes even further. It has an it steering committee that acts like a venture-capital firm, screening all proposed it projects and picking those with the best business plans. But the firm’s in-house entrepreneurs do more than produce good roi numbers. They also point out the necessary changes in business processes and organisation to ensure that employees are willing to use the new it system. “People can undermine any technology,” says Mr Lofgren. Given the chill in the industry, it is no wonder that companies everywhere are rationalising their existing it infrastructure and keeping purse strings tight. General Motors, for instance, has reduced the number of its computer systems from 3,000 to 1,300 by consolidating applications and servers.

There are plenty of 0 1999 2000 01 02* 03* 04* others. Some firms are openSource: Gartner Dataquest *Forecast ing up their networks through online business-to-business exchanges, for example, where they list what they want to buy or sell and invite bids. Everything from paper clips to car components is bought or sold in this way. There is widespread agreement that “web services”, in which companies open up their core business processes directly to other firms over the internet, will become increasingly important in the next few years. But by opening its systems to outsiders, a company may also attract unwanted visitors, or attacks from nosy competitors. Joint ventures, in which two firms collaborate and share information, can also cause problems. A report by Vista Research cites the example of an American carmaker that established a joint venture with a Japanese firm and opened up its network to allow in employees of its Japanese partner.


pages: 346 words: 89,180

Capitalism Without Capital: The Rise of the Intangible Economy by Jonathan Haskel, Stian Westlake

"Robert Solow", 23andMe, activist fund / activist shareholder / activist investor, Airbnb, Albert Einstein, Andrei Shleifer, bank run, banking crisis, Bernie Sanders, business climate, business process, buy and hold, Capital in the Twenty-First Century by Thomas Piketty, cloud computing, cognitive bias, computer age, corporate governance, corporate raider, correlation does not imply causation, creative destruction, dark matter, Diane Coyle, Donald Trump, Douglas Engelbart, Douglas Engelbart, Edward Glaeser, Elon Musk, endogenous growth, Erik Brynjolfsson, everywhere but in the productivity statistics, Fellow of the Royal Society, financial innovation, full employment, fundamental attribution error, future of work, Gini coefficient, Hernando de Soto, hiring and firing, income inequality, index card, indoor plumbing, intangible asset, Internet of things, Jane Jacobs, Jaron Lanier, job automation, Kenneth Arrow, Kickstarter, knowledge economy, knowledge worker, laissez-faire capitalism, liquidity trap, low skilled workers, Marc Andreessen, Mother of all demos, Network effects, new economy, open economy, patent troll, paypal mafia, Peter Thiel, pets.com, place-making, post-industrial society, Productivity paradox, quantitative hedge fund, rent-seeking, revision control, Richard Florida, ride hailing / ride sharing, Robert Gordon, Ronald Coase, Sand Hill Road, Second Machine Age, secular stagnation, self-driving car, shareholder value, sharing economy, Silicon Valley, six sigma, Skype, software patent, sovereign wealth fund, spinning jenny, Steve Jobs, survivorship bias, The Rise and Fall of American Growth, The Wealth of Nations by Adam Smith, Tim Cook: Apple, total factor productivity, Tyler Cowen: Great Stagnation, urban planning, Vanguard fund, walkable city, X Prize, zero-sum game

On the right are intangibles: software, databases, design, mineral exploration, R&D, and business processes, for example. These intangibles in the right column are those elements of spending that business and national accountants have been reluctant to count as investment, though, as we shall see, over the last forty years some of them have been included as such. TABLE 2.1. EXAMPLES OF TANGIBLE AND INTANGIBLE BUSINESS INVESTMENTS Tangible investments Intangible investments Buildings Software ICT equipment (e.g., computer hardware, communications equipment) Databases Noncomputer machinery and equipment R&D Vehicles Mineral exploration Creating entertainment, literary or artistic originals Design Training Market research and branding Business process reengineering Source: Adapted from the System of National Accounts (SNA) 2008, para 10.67 and table 10.2, and Corrado, Hulten, and Sichel 2005.

Computerized information Software development Patent, copyright, design IPR, trademark, other Yes, since early 2000s Database development Copyright, other Recommended in SNA 1993, but OECD suggests uneven implementation Innovative Property R&D Patents, design IPR Yes, recommended in SNA 2008, introduced gradually since then Mineral exploration Patents, other Yes Creating entertainment and artistic originals Copyright, design IPR Yes in EU, in US since 2013 Design and other product development costs Copyright, design IPR, trademark No Economic Competencies Training Other No Market research and branding Copyright, trademark No Business process re-engineering Patent, copyright, other No Note: R&D should be thought of, in line with official definitions, as scientific-oriented spending as distinct from, say, artistic or design endeavors. “Other” in column 3 refers to things like trade secrets, contracts, etc. Column 3 refers to formal intellectual property: we would expect all intangible investment to produce tacit knowledge as well.

In particular, such investment involves three main types: marketing and branding (investment in understanding customer needs and creating brands that appeal to them); organizational capital, such as creating distinctive business models or corporate cultures; and training that is specific to the company. Table 3.1 also shows two other pieces of information. The third column looks at the kind of intellectual property rights (IPRs) that each type of investment might generate: patents for R&D, for example, or copyrights for entertainment investment. Some of these IPRs depend upon the country: business processes and software cannot be patented in some countries. (Note too that the table suggests that studying patenting, as many innovation metrics do, tells us only part of the innovation picture.) And the final column sets out whether statistical agencies treat such spending categories as investment: as can be seen, many of them are now so treated. However, this treatment is relatively recent and coverage can be uneven, so, for example, the counting of database investment is in practice inconsistent across countries (Corrado et al. 2013).


pages: 293 words: 78,439

Dual Transformation: How to Reposition Today's Business While Creating the Future by Scott D. Anthony, Mark W. Johnson

activist fund / activist shareholder / activist investor, additive manufacturing, Affordable Care Act / Obamacare, Airbnb, Amazon Web Services, autonomous vehicles, barriers to entry, Ben Horowitz, blockchain, business process, business process outsourcing, call centre, Clayton Christensen, cloud computing, commoditize, corporate governance, creative destruction, crowdsourcing, death of newspapers, disintermediation, disruptive innovation, distributed ledger, diversified portfolio, Internet of things, invention of hypertext, inventory management, Jeff Bezos, job automation, job satisfaction, Joseph Schumpeter, Kickstarter, late fees, Lean Startup, Lyft, M-Pesa, Marc Andreessen, Mark Zuckerberg, Minecraft, obamacare, Parag Khanna, Paul Graham, peer-to-peer lending, pez dispenser, recommendation engine, self-driving car, shareholder value, side project, Silicon Valley, Skype, software as a service, software is eating the world, Steve Jobs, the market place, the scientific method, Thomas Kuhn: the structure of scientific revolutions, transfer pricing, uber lyft, Watson beat the top human players on Jeopardy!, Y Combinator, Zipcar

Chapter 2 details how success with transformation A starts with determining the customer problem, or the job to be done, around which you should reposition your core and then innovating your business model to deliver against the job, measuring and tracking new metrics that reflect the new model, and burning the boats by executing rapidly. In parallel, Xerox began to experiment with new service lines designed to optimize repeatable business processes. It built a line of businesses that produced hundreds of millions of dollars in revenue, and then in 2009 it spent more than $6 billion to buy Affiliated Computer Services (ACS), a company that specialized in business process automation. This is transformation B: creating a new growth engine. Whereas transformation A is often defensive in nature, the disruption that forces it opens opportunities to solve new (but related) problems in different (but related) ways. Put another way, the disruptive forces that threaten to rip apart today’s business create conditions to build tomorrow’s business.

Total employment rose to almost 150,000, and its stock price increased fourfold between 2000 and 2015. But the forces of industry change are relentless. Revenues dipped from $21 billion in 2012 to $18 billion in 2015, and Xerox’s stock fell by almost 50 percent from January 2015 to January 2016. Later that year, influenced undoubtedly by pressure from activist investor Carl Icahn, Xerox announced plans to split into two companies: a business process-outsourcing company called Conduent, with 96,000 employees and $7 billion in revenue; and a copier and printer business, with 39,000 employees and $7 billion in revenue. The two offshoot businesses are individually more vibrant than either would have been a decade ago but no doubt will again confront the challenge of disruptive change in their respective markets. FIGURE 1-4 Dual transformation Figure 1-4 summarizes the core dual transformation equation.

Beyond having to deal with general trends driving down so-called snail mail, SingPost also confronted the challenge of the 2007 expiry of its exclusive licenses for receiving, collecting, and delivering postcards, which constituted a significant portion of its business. After its IPO, SingPost diversified its core business by introducing bill payment services at post offices (2005), building a direct mail business (2007), and offering mail room management and other business-process outsourcing solutions for small businesses (capabilities tied to its 2009 acquisition of Quantum Solutions, described below). To appeal to younger consumers, in 2010 it launched a business called KPO in the city’s tourism and shopping belt, integrating a trendy pub and café that is open at night and on weekends. In 2010, then CEO Wilson Tan said, “There will be times where we must be prepared to cut off things that have been good for us in the past, but may no longer be relevant today . . . it’s better to shift gears and move on.”


pages: 268 words: 109,447

The Cultural Logic of Computation by David Golumbia

Alan Turing: On Computable Numbers, with an Application to the Entscheidungsproblem, American ideology, Benoit Mandelbrot, borderless world, business process, cellular automata, citizen journalism, Claude Shannon: information theory, computer age, corporate governance, creative destruction, en.wikipedia.org, finite state, future of work, Google Earth, Howard Zinn, IBM and the Holocaust, iterative process, Jaron Lanier, jimmy wales, John von Neumann, Joseph Schumpeter, late capitalism, means of production, natural language processing, Norbert Wiener, packet switching, RAND corporation, Ray Kurzweil, RFID, Richard Stallman, semantic web, Shoshana Zuboff, Slavoj Žižek, social web, stem cell, Stephen Hawking, Steve Ballmer, Stewart Brand, strong AI, supply-chain management, supply-chain management software, Ted Nelson, telemarketer, The Wisdom of Crowds, theory of mind, Turing machine, Turing test, Vannevar Bush, web application

While Friedman’s apparently middle-class “Mom and Dad” certainly benefit from the availability and convenience of computerized tools, the main benefits Friedman describes empower centralized corporations to distribute their own work widely, and in some sense even more fully subordinating their workers to management. Surprisingly, though, despite the ways in which Friedman’s first three benefits replicate colonial logic and largely benefit large corporations, the rest of his ten “forces” are even more explicitly focused on corporations. In fact, they are largely devoted to exactly the kinds of business-process tools discussed in Chapter 7: ERP, CRM, and other supply-chain management software. Friedman champions open source software, especially Linux, but primarily because IBM realized that it could profit from the distributed community that had created it (which is itself largely made up of corporate employees working without compensation in their free time); arguably, we still talk about Linux precisely because of its utility to profitmaking corporations.

Whether this specialization led to the discipline of inventory and materials control is not clear, but we can assume that certain people were allocated the The Cultural Logic of Computation p 164 task of purchasing material for the business, and others were employed to sell the finished product. . . . This logic of breaking down the responsibility for production between different functional areas is evident in ERP systems, even though their objective is to integrate all operations and support more efficient sharing of data about business processes. (O’Gorman 2004, 26) Computing does not merely enable accountants to keep better records of monetary transactions; it provides whole new levels and kinds of power and control over money. This power and control, as businesses almost immediately realized, could be extended to every aspect of running a business; today, ERP vendors see “backoffice” functions (such as operations, logistics, finance, and human resources) and “nontransaction-based systems” or “front-office” functions (such as sales, marketing, and customer service), as integral components of ERP systems.

By computerized control we are referring not to simple recording and tracking, but just as much to development of control and planning structures that would not be available to the business without the kind of largescale planning and allocation made possible by computers. The kinds of constituents that can be identified by computers are to greater and lesser degrees formalized; they are “business models,” abstractions from the real world that allow the computer to manage them as representations; and the strategies suggested by computation are those that the computer finds it especially direct to provide. ERP business process analyses look for so-called “inefficiencies” in the system, finding places, for example, where a resource is sitting idle when it could be doing work. We know that “profit” will never fail to be included as the primary value toward which the system is skewed. In some systems of discourse, cultural studies has uncovered what seem to be covert marks of orientations toward capital; in ERP systems these orientations are explicit.


pages: 480 words: 122,663

The Art of SQL by Stephane Faroult, Peter Robson

business intelligence, business process, constrained optimization, continuation of politics by other means, database schema, full text search, invisible hand

If we admit that a row in a table represents a statement about the characteristics of a given "thing," indicating that "we don't know" for most characteristics seriously downgrades the table as a source of reliable information. This may be a minor inconvenience if the data is stored for informative purpose only. It becomes a major issue if the unknown values are supposed to help us define a result set, and this state of affairs is indicative of a flawed model. All columns in a row should ultimately contain a value, even if business processes are such that various pieces of information are entered from more than one source and/or at different points in time. A stamp collector might likewise keep some room in an album for a series temporarily absent from the collection. But even so, there is a risk of wasting storage if it is actually reserved because one always tailors for the maximum size. There is also a risk of very serious performance problems if only placeholders are used and data goes to some remote overflow area when it is entered at last.

Important Creating, altering, or dropping database objects belong to application design, not to regular operations. Operations Against Actual Data Many developers like to create temporary work tables into which they extract lists of data for subsequent processing, before they begin with the serious stuff. This approach is often questionable and may reflect an inability to think beyond the details of the business processes. You must remember that temporary tables cannot offer storage options of the same degree of sophistication as permanent tables (you see some of these options in Chapter 5). Their indexing, if they are indexed, may be less than optimal. As a result, queries that use temporary tables may perform less efficiently than well-written statements against permanent tables, with the additional overhead of having to fill temporary tables as a prerequisite to any query.

The way in which you physically structure your data is extremely dependent on the nature of the data and its intended use. For example, partitioning can be a valuable aid in optimizing a physical design, but it should never be applied in a haphazard way. Because there is such an intimate relationship between process requirements and physical design , we often encounter profound conflicts between alternative designs for the same data when that data is shared between two or more business processes. This is just like the dilemma faced by the general on the battlefield, where the benefits of using alternative parts of his forces (infantry, cavalry, or artillery) have to be balanced against the suitability of the terrain across which he has to deploy them. The physical design of tables and indexes is one of those areas where database administrators and developers must work together, trying to match the available DBMS features in the best possible way against business requirements.


pages: 255 words: 55,018

Architecting For Scale by Lee Atchison

Amazon Web Services, business process, cloud computing, continuous integration, DevOps, Internet of things, microservices, platform as a service, risk tolerance, software as a service, web application

Don’t output garbage if you’ve been given garbage as input. If you provide an unpredictable response to an unpredictable reaction from a downstream service, you just propagate the unpredictable nature up the value chain. Sooner or later, that unpredictable reaction will be visible to your customers, which will affect your business. Or, worse, the unpredictable response injects invalid data into your business processes, which makes your business processes inconsistent and invalid. This can affect your business analytics as well as promote a negative customer experience. As much as possible, even if your dependencies fail or act unpredictably, it is important that you do not propagate that unpredictability upward to those who depend on you. Note A predictable response really means a planned response. Don’t think “Well, if a dependency fails, I can’t do anything so I might just as well fail, too.”

If you do not take time to maintain your risk matrix, it will rapidly become out of date and useless. To keep your risk matrix up to date and accurate, you should schedule regular reviews of the matrix with the appropriate stakeholders, including your development team and partners. This can be monthly, but it should not be any less often than quarterly. The exact recurrence cycle depends on your business processes. If you have a planning cycle starting soon, performing a regular review of the matrix before that process begins is ideal. Risk Matrix Review Attendees Note that it is useful to change your risk matrix reviewers regularly. By requiring different individuals to review and comment on your risk matrix, you’ll get a fresh perspective and the review will be less likely to turn into a “same old rut” type of meeting.

A Tier 1 service failure is a serious concern to your company. Tier 2 A Tier 2 service is one that is important to your business but less critical than a Tier 1. A failure in a Tier 2 service can cause a degraded customer experience in a noticeable and meaningful way but does not completely prevent your customer from interacting with your system. Tier 2 services are also services that affect your backend business processes in significant ways, but might not be directly noticeable to your customers. The following are some examples of Tier 2 services: Search service A service that provides a search functionality on your website. Order fulfillment service A service that makes it possible for your warehouse to process an order for shipment to a customer. A failure of a Tier 2 service will have a negative customer impact but does not represent a complete system failure.


pages: 204 words: 58,565

Keeping Up With the Quants: Your Guide to Understanding and Using Analytics by Thomas H. Davenport, Jinho Kim

Black-Scholes formula, business intelligence, business process, call centre, computer age, correlation coefficient, correlation does not imply causation, Credit Default Swap, en.wikipedia.org, feminist movement, Florence Nightingale: pie chart, forensic accounting, global supply chain, Hans Rosling, hypertext link, invention of the telescope, inventory management, Jeff Bezos, Johannes Kepler, longitudinal study, margin call, Moneyball by Michael Lewis explains big data, Myron Scholes, Netflix Prize, p-value, performance metric, publish or perish, quantitative hedge fund, random walk, Renaissance Technologies, Robert Shiller, Robert Shiller, self-driving car, sentiment analysis, six sigma, Skype, statistical model, supply-chain management, text mining, the scientific method, Thomas Davenport

The goal is to actually improve the process or decision, so you or your analysts will need to engage in whatever it takes to bring those improvements about. When Tom did some research on how companies improved fifty-seven different decisions a few years ago, he found that analytics was the factor that was most often mentioned as a means to bring about improvement.11 But “culture and leadership changes” were second, “better data” was third, and “changing the business process” was fourth. On average, the companies interviewed mentioned more than five different factors that were responsible for the improvement in decisions. That means that analysts have to be more than analysts; they have to be consultants in business change. When Results Don’t Imply Actions We expect that the results from quantitative analysis will lead to action, but sometimes perfectly good results don’t translate into specific actions, although they are still useful to know.

While the math person can never fully understand the origins of the business intuition—by definition—the math person must understand what the intuition is and speak the language of the business person. Intel’s approach is to send one of its “math people” off into the business—at least to listen, learn, and after a suitable time, ask questions. At most, the analyst can be trained, as a new hire would be, to participate in the business process. In both cases the mission is to understand the formal and informal organization, how the group is incentivized and rewarded, and so forth. Kempf judges the low bar for success as when the math person thinks he or she understands the business problem. The high bar is when the business person thinks the math person understands the business problem. This generally builds some business respect for the math person (“first time anyone has actually come and spent time to understand our problems—this person is genuinely interested in helping us”), and very often builds some math respect for the business person (“not as easy as I thought it would be—this guy is actually pretty clever”).

In a government agency or nonprofit organization, there are usually translations that fit that context involving citizens, constituents, and budgets. * * * What Business Decision Makers Should Expect of Quantitative Analysts If you’re a business executive who is working with quantitative analysts, here’s what you should legitimately expect of them: They should have a good working understanding of your business overall, and of the specific business process that the quantitative analysis will support. They should understand your thinking style and the types of analyses and outputs that will influence your thinking. They should be able to develop effective working relationships with key people in your organization. They should use the language of your business to explain what benefits and improvements analytics can provide. They should provide you with an accurate estimate of the time and cost to develop a model and related capabilities.


pages: 540 words: 103,101

Building Microservices by Sam Newman

airport security, Amazon Web Services, anti-pattern, business process, call centre, continuous integration, create, read, update, delete, defense in depth, don't repeat yourself, Edward Snowden, fault tolerance, index card, information retrieval, Infrastructure as a Service, inventory management, job automation, Kubernetes, load shedding, loose coupling, microservices, MITM: man-in-the-middle, platform as a service, premature optimization, pull request, recommendation engine, social graph, software as a service, source of truth, the built environment, web application, WebSocket

If some other service needed to reach to the creation of a customer, it just needs to subscribe to the events and do its job when needed. The downside is that the explicit view of the business process we see in Figure 4-2 is now only implicitly reflected in our system. Figure 4-4. Handling customer creation via choreography This means additional work is needed to ensure that you can monitor and track that the right things have happened. For example, would you know if the loyalty points bank had a bug and for some reason didn’t set up the correct account? One approach I like for dealing with this is to build a monitoring system that explicitly matches the view of the business process in Figure 4-2, but then tracks what each of the services does as independent entities, letting you see odd exceptions mapped onto the more explicit process flow.

To help us think this through, let’s pick a real-world example from MusicCorp. Customer creation at first glance could be considered a simple set of CRUD operations, but for most systems it is more complex than that. Enrolling a new customer may need to kick off additional processes, like setting up financial payments or sending out welcome emails. And when we change or delete a customer, other business processes might get triggered as well. So with that in mind, we should look at some different ways in which we might want to work with customers in our MusicCorp system. The Shared Database By far the most common form of integration that I or any of my colleagues see in the industry is database (DB) integration. In this world, if other services want information from a service, they reach into the database.

So are there any other drivers that might push us to pick one style over another? One important factor to consider is how well these styles are suited for solving an often-complex problem: how do we handle processes that span service boundaries and may be long running? Orchestration Versus Choreography As we start to model more and more complex logic, we have to deal with the problem of managing business processes that stretch across the boundary of individual services. And with microservices, we’ll hit this limit sooner than usual. Let’s take an example from MusicCorp, and look at what happens when we create a customer: A new record is created in the loyalty points bank for the customer. Our postal system sends out a welcome pack. We send a welcome email to the customer. This is very easy to model conceptually as a flowchart, as we do in Figure 4-2.


pages: 400 words: 88,647

Frugal Innovation: How to Do Better With Less by Jaideep Prabhu Navi Radjou

3D printing, additive manufacturing, Affordable Care Act / Obamacare, Airbnb, Albert Einstein, barriers to entry, Baxter: Rethink Robotics, Bretton Woods, business climate, business process, call centre, Capital in the Twenty-First Century by Thomas Piketty, carbon footprint, cloud computing, collaborative consumption, collaborative economy, Computer Numeric Control, connected car, corporate social responsibility, creative destruction, crowdsourcing, disruptive innovation, Elon Musk, financial exclusion, financial innovation, global supply chain, IKEA effect, income inequality, industrial robot, intangible asset, Internet of things, job satisfaction, Khan Academy, Kickstarter, late fees, Lean Startup, low cost airline, low cost carrier, M-Pesa, Mahatma Gandhi, megacity, minimum viable product, more computing power than Apollo, new economy, payday loans, peer-to-peer lending, Peter H. Diamandis: Planetary Resources, precision agriculture, race to the bottom, reshoring, risk tolerance, Ronald Coase, self-driving car, shareholder value, sharing economy, Silicon Valley, Silicon Valley startup, six sigma, smart grid, smart meter, software as a service, standardized shipping container, Steve Jobs, supply-chain management, TaskRabbit, The Fortune at the Bottom of the Pyramid, The Nature of the Firm, transaction costs, Travis Kalanick, unbanked and underbanked, underbanked, women in the workforce, X Prize, yield management, Zipcar

In 2004, Jørgen Vig Knudstorp, chief executive of Lego Group, a Danish toy manufacturer, created a cross-functional team (called the executive innovation governance group) to lead the company’s innovation activities. It formulated innovation strategy, selected the product portfolio and co-ordinated efforts across groups, delegating authority, allocating resources and evaluating results to make sure they supported company strategy. As a result, Lego’s managers considered not only new products but also pricing plans, business processes and channels to market. Integrate technical and business design A specific form of cross-functional integration that is crucial to innovation is that between technical and business design. As Matt Bross, former chief technology officer at BT, a British multinational telecommunications company, noted:14 “There are no breakthrough technologies, only breakthrough market applications.” R&D’s inventions, ground-breaking or otherwise, which are not backed by sound business models, are more likely to be axed by growth-seeking business leaders.

For instance, Steelcase, a global developer and manufacturer of office products and services, used OpenIDEO to find ways to revitalise cities in economic decline such as Detroit. Coca-Cola tapped OpenIDEO to identify techniques for encouraging households to recycle more. Similarly, Unilever has an online portal where it challenges the public to help solve social problems such as improving access to safe drinking water, reducing salt and sugar in food items, and storing renewable energy. Ideas from the public help Unilever develop better products and improve its business processes while contributing to society. Phase 3: co-marketing, co-branding and co-distribution Some 92% of consumers place more trust in suggestions and recommendations from friends and family than in advertisements. Indeed, only 10% of consumers trust brands at all. As a result, once a new product or service is available, companies need to mobilise communities of prosumers to create demand for it, by turning them into brand ambassadors who promote and even sell their favourite products and services.

These unique attributes of the GVIC’s operating model boost the success rate and impact of its frugal innovation projects. The GVIC is blazing a trail for companies in business model innovation (BMI). Although BMI is the starting point for frugal innovation, most large companies begin on the wrong foot. They first try to reduce the fat from their existing bloated businesses using techniques such as value engineering, business process re-engineering and lean manufacturing. This subtractive approach has two limitations: first, there is only so much waste that can be removed; and second, the leaner business model may still not address the real needs of the firm’s targeted customers. You cannot re-engineer a company to death; you need a new model. This is why the GVIC’s BMI initiatives, which lead to disruptive value solutions, start from scratch and consider customers’ most critical needs.


pages: 232 words: 71,024

The Decline and Fall of IBM: End of an American Icon? by Robert X. Cringely

AltaVista, Bernie Madoff, business cycle, business process, cloud computing, commoditize, compound rate of return, corporate raider, full employment, if you build it, they will come, immigration reform, interchangeable parts, invention of the telephone, Khan Academy, knowledge worker, low skilled workers, Paul Graham, platform as a service, race to the bottom, remote working, Robert Metcalfe, Robert X Cringely, shareholder value, Silicon Valley, six sigma, software as a service, Steve Jobs, Toyota Production System, Watson beat the top human players on Jeopardy!, web application

The layoffs, the frozen pay, the furloughs—all of it are IBM's way of saying you have failed the sales organization. Sales are the only important thing in IBM and everything else is secondary. If customers are not buying, it has to be someone's fault. Punishing people is the way IBM fixes its problems. Because IBM's leadership has no outside world experience, punishing people is the only solution to their problems. They do not understand the business process or the fact that management might need improvement. They do not understand that investments in improvements are periodically needed to insure the health and effectiveness of every operation. Since Palmisano started setting public earnings targets in the investment community, IBM's new customer is Wall Street. Sam sold Wall Street on $20 earnings-per-share and an increasing stock price as a result.

Can these businesses be grown in three to five years into the multi-billion-dollar level of gross profit coming from Global Services? Most of these businesses are tiny. A few of them are not even well conceived as businesses. It takes special skills and commitment to grow a business from nothing to the $1 billion range. IBM probably doesn’t have what it takes. Do you remember eBusiness? (A termed coined by IBM in 1997 that meant transforming key business processes using Internet technologies.) And I’ve already mentioned On Demand, the utility computing service system for large enterprises. These are examples of businesses IBM planned to grow to billions in sales, but are businesses that no longer even exist today. The Blue Gene supercomputer project belongs here, too. Here’s a simple thought experiment: When it comes to these new software and Internet services, IBM’s competition comes from a variety of companies including Amazon, Apple, Dell, Google, Hewlett Packard, Oracle and others.

For the last 10 years, IBM’s Services divisions have been subjected to relentless cost reductions, layoffs, massive offshoring of work, and a scary process of dumbing down the talent. The result is an organization that can barely do the basics and has become a huge frustration to its customers. The problems in services are deep and serious. Most of the great processes IBM developed over the years have been lost. The new business process—Engagement, Transition, and Steady State—has become a “throw it over the wall” process. Each step in the process passes on incomplete, often incorrect work and documentation. IBM underprices the work, and then earmarks its profit. What money is left is used to start up and support the account. The Steady State teams receive tools that don’t work, incomplete server lists, little or no documentation, and often less than half of the staff they need to do the job.


pages: 413 words: 117,782

What Happened to Goldman Sachs: An Insider's Story of Organizational Drift and Its Unintended Consequences by Steven G. Mandis

activist fund / activist shareholder / activist investor, algorithmic trading, Berlin Wall, bonus culture, BRICs, business process, buy and hold, collapse of Lehman Brothers, collateralized debt obligation, commoditize, complexity theory, corporate governance, corporate raider, Credit Default Swap, credit default swaps / collateralized debt obligations, crony capitalism, disintermediation, diversification, Emanuel Derman, financial innovation, fixed income, friendly fire, Goldman Sachs: Vampire Squid, high net worth, housing crisis, London Whale, Long Term Capital Management, merger arbitrage, Myron Scholes, new economy, passive investing, performance metric, risk tolerance, Ronald Reagan, Saturday Night Live, Satyajit Das, shareholder value, short selling, sovereign wealth fund, The Nature of the Firm, too big to fail, value at risk

My rotations to a different geographic region and through different divisions were typical at the time for a certain percentage of selected employees in order to train people and unite the firm. Throughout my career at Goldman, I served on firm-wide and divisional committees, dealing with important strategic and business process issues. I also acted as special assistant to several senior Goldman executives and board members, including Hank Paulson, on select projects and initiatives such as improving business processes and cross-department communication protocols. Goldman was constantly trying to improve and setting up committees with people from various geographic regions and departments to create initiatives. I was never a partner at Goldman. I participated in many meetings where I was the only nonpartner in attendance and prepared analysis or presentations for partner meetings, or in response to partner meetings, but I did not participate in “partner-only” meetings.

For all these reasons, a job in the department was highly prized, and the competition was fierce. When the New York M&A department hired me, it was making about a dozen offers per year to US college graduates to work in New York, out of what I was told were hundreds of applicants. While in the department, I was asked to be the business unit manager (informally referred to as the “BUM”). I addressed issues of strategy, business processes, organizational policy, business selection, and conflict clearance. For example, I was involved in discussions in deciding whether and how Goldman should participate in hostile raids, and in discussing client conflicts and ways to address them. The job was extremely demanding. After a relatively successful stint, I felt I had built enough goodwill to move internally and do what I was more interested in: being an investor.

In addition, unlike Goldman, Citigroup was created through a series of mergers and acquisitions. At Citi, I had the chance to compare the practices and approaches of a Goldman competitor that had a big balance sheet (supported by customer deposits to lend money to clients) and that had grown quickly through acquisitions—two things Goldman did not really do. Before working at Citigroup and during the financial crisis, I advised McKinsey & Company on strategic, business process, risk, and organizational issues facing financial institutions and related regulatory authorities worldwide. McKinsey is one of the most prestigious and trusted management-consulting firms in the world, with some fifteen thousand people globally. There are many differences between the firms, but as with Goldman (before Goldman became a public corporation), McKinsey is a private partnership that has a revered partnership election process.


pages: 777 words: 186,993

Imagining India by Nandan Nilekani

addicted to oil, affirmative action, Airbus A320, BRICs, British Empire, business process, business process outsourcing, call centre, clean water, colonial rule, corporate governance, cuban missile crisis, deindustrialization, demographic dividend, demographic transition, Deng Xiaoping, digital map, distributed generation, farmers can use mobile phones to check market prices, full employment, ghettoisation, glass ceiling, global supply chain, Hernando de Soto, income inequality, informal economy, information asymmetry, Intergovernmental Panel on Climate Change (IPCC), joint-stock company, knowledge economy, land reform, light touch regulation, LNG terminal, load shedding, low cost airline, Mahatma Gandhi, market fragmentation, mass immigration, Mikhail Gorbachev, Network effects, new economy, New Urbanism, open economy, Parag Khanna, pension reform, Potemkin village, price mechanism, race to the bottom, rent control, rolodex, Ronald Reagan, school vouchers, Silicon Valley, smart grid, special economic zone, The Wealth of Nations by Adam Smith, Thomas L Friedman, Thomas Malthus, transaction costs, trickle-down economics, unemployed young men, upwardly mobile, urban planning, urban renewal, women in the workforce, working poor, working-age population

India thus literally stumbled onto services growth, one that happens to be the emerging story for the international economy. Today, the exploding global, IT-led services economy is impacting more business processes than we thought possible, as technology transforms more and more processes across the value chain into work over wire—from research and development (R&D) to medical diagnostics and, in one rather unusual case, even on-scene news reporting when Indian “reporters” watched conferences by video and typed up news reports for a U.S. paper. As a result the world market for offshored IT services and business processes has nearly tripled since 2001—it is now estimated to be a $300 billion opportunity, of which service providers have so far captured just 10 percent. And as the dominant player in the sector, India is now uniquely placed to capture this market—compelling Tom Friedman to call us “the luckiest country of the twentieth century.”

This change is especially clear in our attitude toward English, which has undergone a transformation postreform. The change was largely driven by the rise of India’s outsourcing industry. The 1990s had marked the rise of Indian IT companies including Infosys, and our key advantage in competing in the global services market—our purple poker chip—has been India’s large numbers of affordable, educated and English-literate workers. In the business process outsourcing (BPO) sector in particular, more than 65 percent of jobs are defined as voice-based jobs, and English-language proficiency is the main requirement for these companies. These firms were closely aligned with global corporations, and both productivity and wages were linked quite closely to global market averages. The result was that, through the 1990s, potential earnings for India’s English-skilled graduates surged.

“We are on average five to ten years ahead of many countries in the West in our IT systems.” Information technology in the new Indian landscape Increasingly, India’s new identity has technology embedded in our fingerprints. IT in India has proved itself lithe and surprisingly agile, penetrating the nooks and corners of a country in ways we would have been unable to predict even a decade ago. IT-led business processes and supply chains are bringing in once marginal rural communities into the market, and also expanding access to scarce resources. Electronification is reaching out across India’s divides, whether they are geographical, cultural or economic. The technology is playing an emerging role in uniting communities under single national systems, which are quickly making geographical distances irrelevant.


pages: 302 words: 73,581

Platform Scale: How an Emerging Business Model Helps Startups Build Large Empires With Minimum Investment by Sangeet Paul Choudary

3D printing, Airbnb, Amazon Web Services, barriers to entry, bitcoin, blockchain, business process, Chuck Templeton: OpenTable:, Clayton Christensen, collaborative economy, commoditize, crowdsourcing, cryptocurrency, data acquisition, frictionless, game design, hive mind, Internet of things, invisible hand, Kickstarter, Lean Startup, Lyft, M-Pesa, Marc Andreessen, Mark Zuckerberg, means of production, multi-sided market, Network effects, new economy, Paul Graham, recommendation engine, ride hailing / ride sharing, shareholder value, sharing economy, Silicon Valley, Skype, Snapchat, social graph, social software, software as a service, software is eating the world, Spread Networks laid a new fibre optics cable between New York and Chicago, TaskRabbit, the payments system, too big to fail, transport as a service, two-sided market, Uber and Lyft, Uber for X, uber lyft, Wave and Pay

To better understand these new models of growth, it is important first to explore the history of business scale in the context of the shift from pipes to platforms. A BRIEF HISTORY OF SCALE The ability of a business to scale is determined by its ability to aggregate the inputs to business – labor and resources – and coordinate them efficiently toward value creation and delivery. Pipe Scale In a world of pipes, businesses achieved scale by aggregating labor and resources internally and used value-creating business processes to transform these inputs into functioning products and deliverable services. As these organizations grew larger, they increased process efficiency and managed value creation through command-and-control hierarchies. In a world of pipes, aggregation also helped firms exchange created value for commercial gain. The pipe world aggregated attention around specific mass media channels. The purchase of goods and services was aggregated at retail stores.

Today’s leading platforms – Pinterest, Airbnb, Uber, Twitter – created new behaviors that had never existed in the past. In addition to behavior design, network effects also create stickiness. As the value of the platform increases with greater participation, consumers and producers are organically incentivized to stay engaged on the platform because the platform provides increasing amounts of value to both parties. DATA SCIENCE IS THE NEW BUSINESS PROCESS OPTIMIZATION Pipes achieve scale by improving the repeatability and efficiency of value-creation processes. The world of pipes required process engineering and optimization. Process engineers and managers helped improve internal processes and make them more efficient. In a platformed world, value is created in interactions between users, powered by data. Data science improves the platform’s ability to orchestrate interactions in the ecosystem.

Nokia, BlackBerry, and traditional carriers sourced their apps contractually, whereas the iPhone created an open platform, allowing anyone to create apps for it. Increasingly, many industries that have traditionally been considered non-tech, including retail, transportation, and consumer goods, are opening up APIs to encourage innovation by coalescing an external ecosystem of developer-partners. THE INVISIBLE HAND IS THE NEW IRON FIST The business processes that enabled pipe scale have historically been managed via hierarchies. As value creation in a platformed world moves to networks, we need a new form of management and culture, both inside and outside the organization. Hierarchies are based on rules and compliance, which require a unidirectional flow of information from the top down. This iron fist is giving way to the invisible hand. This is most evident in the rise of on-demand labor platforms where the invisible hand of algorithms and APIs dispatches supply to meet demand.


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WTF?: What's the Future and Why It's Up to Us by Tim O'Reilly

4chan, Affordable Care Act / Obamacare, Airbnb, Alvin Roth, Amazon Mechanical Turk, Amazon Web Services, artificial general intelligence, augmented reality, autonomous vehicles, barriers to entry, basic income, Bernie Madoff, Bernie Sanders, Bill Joy: nanobots, bitcoin, blockchain, Bretton Woods, Brewster Kahle, British Empire, business process, call centre, Capital in the Twenty-First Century by Thomas Piketty, Captain Sullenberger Hudson, Chuck Templeton: OpenTable:, Clayton Christensen, clean water, cloud computing, cognitive dissonance, collateralized debt obligation, commoditize, computer vision, corporate governance, corporate raider, creative destruction, crowdsourcing, Danny Hillis, data acquisition, deskilling, DevOps, Donald Davies, Donald Trump, Elon Musk, en.wikipedia.org, Erik Brynjolfsson, Filter Bubble, Firefox, Flash crash, full employment, future of work, George Akerlof, gig economy, glass ceiling, Google Glasses, Gordon Gekko, gravity well, greed is good, Guido van Rossum, High speed trading, hiring and firing, Home mortgage interest deduction, Hyperloop, income inequality, index fund, informal economy, information asymmetry, Internet Archive, Internet of things, invention of movable type, invisible hand, iterative process, Jaron Lanier, Jeff Bezos, jitney, job automation, job satisfaction, John Maynard Keynes: Economic Possibilities for our Grandchildren, John Maynard Keynes: technological unemployment, Kevin Kelly, Khan Academy, Kickstarter, knowledge worker, Kodak vs Instagram, Lao Tzu, Larry Wall, Lean Startup, Leonard Kleinrock, Lyft, Marc Andreessen, Mark Zuckerberg, market fundamentalism, Marshall McLuhan, McMansion, microbiome, microservices, minimum viable product, mortgage tax deduction, move fast and break things, move fast and break things, Network effects, new economy, Nicholas Carr, obamacare, Oculus Rift, packet switching, PageRank, pattern recognition, Paul Buchheit, peer-to-peer, peer-to-peer model, Ponzi scheme, race to the bottom, Ralph Nader, randomized controlled trial, RFC: Request For Comment, Richard Feynman, Richard Stallman, ride hailing / ride sharing, Robert Gordon, Robert Metcalfe, Ronald Coase, Sam Altman, school choice, Second Machine Age, secular stagnation, self-driving car, SETI@home, shareholder value, Silicon Valley, Silicon Valley startup, skunkworks, Skype, smart contracts, Snapchat, Social Responsibility of Business Is to Increase Its Profits, social web, software as a service, software patent, spectrum auction, speech recognition, Stephen Hawking, Steve Ballmer, Steve Jobs, Steven Levy, Stewart Brand, strong AI, TaskRabbit, telepresence, the built environment, The Future of Employment, the map is not the territory, The Nature of the Firm, The Rise and Fall of American Growth, The Wealth of Nations by Adam Smith, Thomas Davenport, transaction costs, transcontinental railway, transportation-network company, Travis Kalanick, trickle-down economics, Uber and Lyft, Uber for X, uber lyft, ubercab, universal basic income, US Airways Flight 1549, VA Linux, Watson beat the top human players on Jeopardy!, We are the 99%, web application, Whole Earth Catalog, winner-take-all economy, women in the workforce, Y Combinator, yellow journalism, zero-sum game, Zipcar

As we’ll see in the next chapter, that’s what I did in my continuing struggle to understand the import of open source software. 2 TOWARD A GLOBAL BRAIN MY FOCUS ON THE INTERNET RATHER THAN ON LINUX EVENTUALLY led me in very different directions from other open source advocates. They wanted to argue about the best open source licenses. I thought that licenses didn’t matter as much as everyone else thought they did. I was fascinated by the massive next-generation infrastructure and business processes Google was building. Others were interested in these things too, but they thought very few companies would need Google’s kind of infrastructure, or to use its techniques. They were wrong. This is my next lesson. If the future is here, but just not evenly distributed yet, find seeds of that future, study them, and ask yourself how things will be different when they are the new normal. What happens if this trend keeps going?

But even more important, even if these sites gave out their source code, users would not easily be able to create a full copy of the running application. I told free software advocates like Richard Stallman that even if they had all of the software that Amazon or Google had built on top of Linux, they wouldn’t have Amazon or Google. These sites didn’t just consist of a set of software programs. They consisted of massive amounts of data and the people and business processes used to gather, manage, and build ongoing services using that data. As I had been exploring this line of argument, the tectonic processes of technology were adding new continents that had to be reflected in the map. In June 1999, Internet file-sharing site Napster turned the industry on its head by allowing users to share music files with each other free of charge across the net. What was most interesting from the technical point of view was that Napster, and soon other file-sharing networks like FreeNet and Gnutella (and a bit later, BitTorrent), didn’t keep all the files in one place like existing online music sites.

The capability to roll something back easily makes failure cheap and pushes decision making further down into the organization. Much of this work is completely automated. Hal Varian calls this “computer kaizen,” referring to the Japanese term for continuous improvement. “Just as mass production changed the way products were assembled and continuous improvement changed how manufacturing was done,” he writes, “continuous experimentation . . . improve[s] the way we optimize business processes in our organizations.” But DevOps also brings higher reliability and better responsiveness to customers. Gene Kim characterizes what happens in a high-performance DevOps organization: “Instead of upstream Development groups causing chaos for those in the downstream work centers (e.g., QA, IT operations, and Infosec), Development is spending twenty percent of its time helping ensure that work flows smoothly through the entire value stream, speeding up automated tests, improving deployment infrastructure, and ensuring that all applications create useful production telemetry.”


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Superminds: The Surprising Power of People and Computers Thinking Together by Thomas W. Malone

agricultural Revolution, Airbnb, Albert Einstein, Amazon Mechanical Turk, Apple's 1984 Super Bowl advert, Asperger Syndrome, Baxter: Rethink Robotics, bitcoin, blockchain, business process, call centre, clean water, creative destruction, crowdsourcing, Donald Trump, Douglas Engelbart, Douglas Engelbart, drone strike, Elon Musk, en.wikipedia.org, Erik Brynjolfsson, experimental economics, Exxon Valdez, future of work, Galaxy Zoo, gig economy, happiness index / gross national happiness, industrial robot, Internet of things, invention of the telegraph, inventory management, invisible hand, Jeff Rulifson, jimmy wales, job automation, John Markoff, Joi Ito, Joseph Schumpeter, Kenneth Arrow, knowledge worker, longitudinal study, Lyft, Marshall McLuhan, Occupy movement, Pareto efficiency, pattern recognition, prediction markets, price mechanism, Ray Kurzweil, Rodney Brooks, Ronald Coase, Second Machine Age, self-driving car, Silicon Valley, slashdot, social intelligence, Stephen Hawking, Steve Jobs, Steven Pinker, Stewart Brand, technological singularity, The Nature of the Firm, The Wealth of Nations by Adam Smith, The Wisdom of Crowds, theory of mind, Tim Cook: Apple, transaction costs, Travis Kalanick, Uber for X, uber lyft, Vernor Vinge, Vilfredo Pareto, Watson beat the top human players on Jeopardy!

We saw this earlier in the system that Xerox service technicians used to share tips about fixing copiers. We also see it when companies learn from trade magazines, conferences, and other media about best practices developed elsewhere in their industries. Another obvious way IT can help superminds learn is by automating work that humans already know how to do. For instance, in the 1990s, many organizations did business process reengineering (BPR) projects where they analyzed their business processes and tried to improve them, often using computers to automate some of the work. In these early reengineering projects, introducing computers was often a big and expensive disruption. But today, to take advantage of the continuing opportunities for more computer support, we should design our processes from the beginning in a way that makes the boundary between what people do and what computers do as flexible as possible.9 CYBER-HUMAN LEARNING LOOPS One way to do this is by creating cyber-human learning loops, in which people and computers work together and get better and better over time, often by letting the computers do more and more of the work (see the diagram below).10 To make a cyber-human learning loop, we need to systematically track as much data as is practical about the inputs, actions taken, and outputs and then analyze this data to continually improve performance.

When you pick one of these options, the system could automatically give you a template for the kinds of details you should specify for each type of strategy. A Strategy Recombinator In addition to just suggesting individual possibilities to consider, software tools could also suggest combinations of possibilities. In 1999, Avi Bernstein, Mark Klein, and I used a semiautomated approach like this to develop ideas for new business processes. We called it the Process Recombinator,4 and I think a similar approach could work for strategies, too. For instance, if people created several possible answers to key strategic questions (such as those involving choices among products, customer segments, and competitive advantages), then it would be easy for a system to automatically generate many possible combinations of these options for people to quickly evaluate.

Bridging the Specificity Frontier,” in Proceedings of the 2000 ACM Conference on Computer Supported Cooperative Work (New York: Association for Computing Machinery, 2000), 279–88. 10. An early example of the idea of cyber-human learning loops is Doug Engelbart’s concept of “bootstrapping” collective intelligence. See Douglas Engelbart and Jeff Rulifson, “Bootstrapping Our Collective Intelligence,” ACM Computing Surveys 31, issue 4es (December 1999), doi:10.1145/345966.346040. Unlike the concept of business process reengineering, which was popular in the 1990s, cyber-human learning loops assume that change is continuous rather than the result of occasional large redesign projects. See Michael Hammer and James Champy, Reengineering the Corporation (New York: HarperBusiness, 1993). In that sense, cyber-human learning loops can be seen as an example of a continuous improvement process. See Wikipedia, s.v.


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The Facebook era: tapping online social networks to build better products, reach new audiences, and sell more stuff by Clara Shih

business process, call centre, Clayton Christensen, cloud computing, commoditize, conceptual framework, corporate governance, crowdsourcing, glass ceiling, jimmy wales, Mark Zuckerberg, Metcalfe’s law, Network effects, pets.com, pre–internet, rolodex, semantic web, sentiment analysis, Silicon Valley, Silicon Valley startup, social graph, social web, software as a service, Tony Hsieh, web application

A customer example often cited by WorkLight is a manufacturing company that needs to manage inventory across different locations, run marketing promotions, and respond to distributor feedback. With WorkLight, the company’s employees, distributors, and suppliers are able to view the information and interact with the business processes relevant to them in a secure fashion behind the corporate firewall. For example, information such as oil prices, competitors’ actions, even weather, can all be pushed to the right stakeholders directly inside Facebook and other sites that are already being routinely accessed by these individuals (see Figure 12.1). From the Library of Kerri Ross C h a p te r 1 2 Th e Fu t u re o f S o c i a l B u s i n e s s 207 Figure 12.1 WorkLight’s solution for enterprise social IT allows companies to publish data and business processes to Facebook and other traditionally consumer sites to make employees more productive. As mentioned earlier in this book, Facebook is also making a big push for the enterprise.

According to the company, mainframe technology helped Mutual of Omaha grow relative to the competition by allowing much more rapid processing of insurance claims, speeding transactions such as benefits checks and premium payments, slowing the growth in number of clerical employees, and eliminating repetitious data handling. Mainframes freed Mutual of Omaha employees from manual processes and stacks of handwritten paperwork. Mainframes also allowed Mutual of Omaha to streamline operations. Business processes that previously spanned multiple functions, with each function handled separately across the company, were gradually combined into one application, saving the company time, effort, and money. The following excerpt, taken from an internal Mutual of Omaha document dated March 15, 1956, reveals the rationale and foresight of company executives in introducing mainframes. **************** What is the matter with our present system?

It was linear thinking. Company Web sites were just online versions of the company brochure. A phone call was the predominant call to action. It wasn’t until nearly a decade later that we began to realize and then slowly tap into the unique attributes of the Internet to do things that simply were not possible prior to the Internet: search engine marketing, user-generated content, automating manual business processes in Web applications, and allowing people to interact with those applications. It took a generation of visionaries, early adopters, and believers to make Web 2.0 a reality. In the process, companies came and went—Netscape, CompuServe, Webvan, Napster, Pets.com, to name a few. Nor should you expect that the kings of today’s era will reign in tomorrow’s era. More likely, the kings don’t see it coming, don’t want to see it coming, or see it coming but can’t get organizationally aligned around doing anything about it.


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The Globotics Upheaval: Globalisation, Robotics and the Future of Work by Richard Baldwin

agricultural Revolution, Airbnb, AltaVista, Amazon Web Services, augmented reality, autonomous vehicles, basic income, business process, business process outsourcing, call centre, Capital in the Twenty-First Century by Thomas Piketty, Cass Sunstein, commoditize, computer vision, Corn Laws, correlation does not imply causation, Credit Default Swap, David Ricardo: comparative advantage, declining real wages, deindustrialization, deskilling, Donald Trump, Douglas Hofstadter, Downton Abbey, Elon Musk, Erik Brynjolfsson, facts on the ground, future of journalism, future of work, George Gilder, Google Glasses, Google Hangouts, hiring and firing, impulse control, income inequality, industrial robot, intangible asset, Internet of things, invisible hand, James Watt: steam engine, Jeff Bezos, job automation, knowledge worker, laissez-faire capitalism, low skilled workers, Machine translation of "The spirit is willing, but the flesh is weak." to Russian and back, manufacturing employment, Mark Zuckerberg, mass immigration, mass incarceration, Metcalfe’s law, new economy, optical character recognition, pattern recognition, Ponzi scheme, post-industrial society, post-work, profit motive, remote working, reshoring, ride hailing / ride sharing, Robert Gordon, Robert Metcalfe, Ronald Reagan, Second Machine Age, self-driving car, side project, Silicon Valley, Skype, Snapchat, social intelligence, sovereign wealth fund, standardized shipping container, statistical model, Stephen Hawking, Steve Jobs, supply-chain management, TaskRabbit, telepresence, telepresence robot, telerobotics, Thomas Malthus, trade liberalization, universal basic income

Indeed, it was Barnes who gave the software a name. Perhaps this naming stems from the fact that the software does exactly what Barnes used to do, and in exactly the same way. Or maybe it is because the RPA seems vulnerable—Poppy cannot handle the tricky cases. Those she has to hand off to Barnes. This sort of personification is pretty common when it comes to software robots. Ann Manning, a worker at the business processing company Xchanging, for example, trained an RPA and then called it Henry. “He is programmed with 400 decisions, all from my brain, so he is part of my brain and I’ve given him a bit of human character,” she explained.7 When a Texas Mercedes dealership implemented a virtual assistant to respond to car queries and set up appointments, the human sales representatives called it Tiffany, and customers loved “her.”

The basic reasoning is as easy as one, two, three: 1) AI software makes it feasible to charge a zero price to consumers for services that a few years ago would have been expensive; 2) people start using these services like crazy; and 3) the companies providing the new services hire people to look after the robots and do more human chores like management, accounting, human resource management, and the like. A third way AI automation is creating jobs in rich nations is by reshoring back-office jobs that had been offshored to countries like India. The idea of replacing high-cost workers doing routine manipulation of information that can be sent down a wire is an old one. Since the 1990s, many companies have sent these jobs overseas. This created a whole industry called business process outsourcing (BPO) that is today dominated by companies like Infosys. RPA is good at many of the tasks that BPO companies now do. The cost savings are almost coercive. According to Genfour, which was acquired by Accenture in 2017, “While an onshore FTE [full-time equivalent worker] costing $50K (total cost) can be replaced by an offshore FTE for $20K, a digital worker can perform the same function for $5K or less—without the drawbacks of managing and training offshore labor.”14 Since the AI software cannot handle all cases, bringing back-office jobs back to America and Europe will create some jobs for white-collar humans along with lots of jobs for white-collar robots.

Another aspect of RPA may dial-up the outrage factor even more. The workers being replaced will be training their robot replacements. Here is how one RPA software company explains it. “WorkFusion automates the time-consuming process of training and selecting machine learning algorithms . . . WorkFusion’s Virtual Data Scientist uses historical data and real-time human actions to train models to automate judgment work in a business process, like categorizing and extracting unstructured information.” This thing, in other words, is a white-collar robot that figures out what parts of the job can be done by a white-collar robot. And it does it by watching what the humans are doing and have done. The program even has a helpful times-up bell. “WorkFusion notifies users when automation can match or exceed the precision level required for a process.”17 The result, the company claims, lets businesses “reduce manual service effort 50 percent.”


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The Power of Pull: How Small Moves, Smartly Made, Can Set Big Things in Motion by John Hagel Iii, John Seely Brown

Albert Einstein, Andrew Keen, barriers to entry, Black Swan, business process, call centre, Clayton Christensen, cleantech, cloud computing, commoditize, corporate governance, creative destruction, disruptive innovation, Elon Musk, en.wikipedia.org, future of work, game design, George Gilder, intangible asset, Isaac Newton, job satisfaction, Joi Ito, knowledge economy, knowledge worker, loose coupling, Louis Pasteur, Malcom McLean invented shipping containers, Maui Hawaii, medical residency, Network effects, old-boy network, packet switching, pattern recognition, peer-to-peer, pre–internet, profit motive, recommendation engine, Ronald Coase, shareholder value, Silicon Valley, Skype, smart transportation, software as a service, supply-chain management, The Nature of the Firm, the new new thing, too big to fail, trade liberalization, transaction costs

For example, twelve hospitals came together in an Enterprise Services Community Definition Group and worked together to define the key service interfaces for several business processes. They achieved their objective in less than six months. But in a growing number of cases, these collaborative creation efforts are driven by teams of individuals who connect on their own initiative around interesting technology opportunities and challenges. ESME, the Enterprise Social Media Experiment, provides one interesting example of this emergent collaboration. Initially this effort started as an online conversation among a group of individual software programmers from around the world who became intrigued with the possibility of taking the concepts behind Twitter and applying them to business process problems that occur inside the enterprise. Twitter had emerged as a messaging platform in the consumer space, but it was not very stable; it needed higher levels of security and more functionality to support further development of ideas generated in messages if it was going to be useful in a corporate context.

Yet they might not buy NetWeaver until they could grasp its potential. To address this dilemma the company launched a creation space consisting of forums, wikis, videos, and blogs targeting a diverse set of relevant participants. The SAP Developer Network (SDN) provided a forum in which software developers could create and share knowledge about platforms and products sourced from SAP and its partners. The Business Process Expert (BPX) Community welcomed people specializing in business procedures and protocols. And Industry Value Networks (IVNs) brought together customers to address issues specific to particular industries—for instance, bank managers looking to develop software interfaces to help them collaborate more effectively. SAP realized that collaboration among participants was essential, and it designed these creation spaces to encourage peer-to-peer interactions.

See Demand forecasts AOL Apparel industry Apple Apple Computer Application programming interfaces (APIs) Archimedes ARM Ask.com Aspen Institute Socrates seminars Astronomy as creation platform Athletic shoes industries Attention allocating attracting, sustaining, with online social networks enhancing the productivity of reciprocity of those sharing passions teasers Attract, as second level of pullig introducedig techniques for drawing people and resources Attraction leading to serendipity with people on edges Bank of America Banzai Pipeline, Oahu, Hawaii Barber, Elinor Barger, Kai Bassij militia Beacon sending Beer brewing example Beginner’s mind Benioff, Marc Berkman Center, Harvard Law School Bernays, Edward Best Buy Better Place Big Shift described first wave: digital infrastructural second wave: knowledge flows third wave: institutional innovations Big wave surfing as a creation space as example of profession as passion expulsion protocols and knowledge flows performance envelopes pushed as physical platform pro tour Bing Blizzard Entertainment Blogs or blogosphere Body Glove Bonner, Sean Boredom in push systems Boston Consulting Group (BCG) Branson, Richard Brin, Sergey Burma. See Myanmar (Burma) Saffron Revolution The Burning Crusade WoW release Business Process Expert (BPX) Community Canguu, Bali Cannon, Walter Carbon war room Cash-for-clunkers initiative ccMixter Chandler, Alfred Change as accelerating with growth initiatives, talent development in and of institutions as opportunity to motivate, mobilize, others with perceptions of fears, risk three phases with trajectory of passion, talent, growth Chief Culture Officer (McCracken) China as geographic edge-transforms-core example geographic spikes in knowledge economy of WoW Christensen, Clayton Cisco Clark, Jeff Clockspeed Cloud computing The Cluetrain Manifesto (Levine and others) Coase, Ronald Collaboration cross-team, for designing creation spaces mindset scalable sustained Collaboration curves defined, described exist as WoW players improve performance institutions reoriented around for mobilizing distributed resources and performance results creating virtuous cycles COMDEX Comfort zones Companies.


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Digital Bank: Strategies for Launching or Becoming a Digital Bank by Chris Skinner

algorithmic trading, AltaVista, Amazon Web Services, Any sufficiently advanced technology is indistinguishable from magic, augmented reality, bank run, Basel III, bitcoin, business cycle, business intelligence, business process, business process outsourcing, buy and hold, call centre, cashless society, clean water, cloud computing, corporate social responsibility, credit crunch, crowdsourcing, cryptocurrency, demand response, disintermediation, don't be evil, en.wikipedia.org, fault tolerance, fiat currency, financial innovation, Google Glasses, high net worth, informal economy, Infrastructure as a Service, Internet of things, Jeff Bezos, Kevin Kelly, Kickstarter, M-Pesa, margin call, mass affluent, MITM: man-in-the-middle, mobile money, Mohammed Bouazizi, new economy, Northern Rock, Occupy movement, Pingit, platform as a service, Ponzi scheme, prediction markets, pre–internet, QR code, quantitative easing, ransomware, reserve currency, RFID, Satoshi Nakamoto, Silicon Valley, smart cities, social intelligence, software as a service, Steve Jobs, strong AI, Stuxnet, trade route, unbanked and underbanked, underbanked, upwardly mobile, We are the 99%, web application, WikiLeaks, Y2K

Buyology: the Science of Understanding Business Relationships If you accept that the future of banking will be based upon which banks are the best buyological scientists then that is the premise that the bank designer would use to build the Digital Bank. The bank would be based upon digitised techniques of customer understanding to build processes from the customer viewpoint. At the end of designing, they would then go to a digital architect to build the digital design. This goes to the core of Business Process Re-engineering (BPR), which is why we talk about process redesign, when we’re designing, and process implementation, when we’re architecting. The architect has been called in recently because the bank’s foundations are suffering from subsidence. The foundations were built on cement and bricks-and-mortar, and those foundations are cracked due to the revolution of technology in the last 50 years.

Now we all talk about The Experience Economy and Engagement Banking, and I sit and think about all of this and wonder whether any bank really understands it. For example, data mining days began in the 1990s with the whole focus being upon data usage for sales. Get more cross-sell, get more relationship depth, get more profit, get rid of loss-making customers ... nothing was really focused upon customer service in that era. It’s similar to the days of Business Process Re-engineering, where the push was for banks to reinvent the customer relationship from the external interaction viewpoint inwards ... instead, most banks opted for purely incremental improvements to internal processes to lower costs. Now there is a big change. That big change is the information economy and the ability of new players to use information as a competitive weapon. Deep data mining can now be used to leverage electronic relationships that deliver the depth, loyalty and sales that banks were seeking a decade ago, and it can all be done today without a human hand involved.

But the risk of losing scale, resilience, security and control is the core issue at a bank’s heart, and they’re not willing to take that risk with cloud, especially if no-one can define it. Talk to anyone and they define it different ways and, in all of this confusion, the decision maker is left confused. Nevertheless, we are moving from a world of finance where technology was core to efficiency in its first wave, and differentiation was core in its second. Initially, mainframe compute power and then Business Process Outsourcing (BPO) and virtualisation created efficient computing capabilities for financial firms. Then the ease of modular computing, service-oriented architectures and Ajax Web 2.0 has made computing applications the differentiating factor between a winning bank and an also-ran bank. Now we are moving to an age where computing and applications just don’t matter. Everything will be utility computing through the cloud.


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The Connected Company by Dave Gray, Thomas Vander Wal

A Pattern Language, Albert Einstein, Amazon Mechanical Turk, Amazon Web Services, Atul Gawande, Berlin Wall, business cycle, business process, call centre, Clayton Christensen, commoditize, complexity theory, creative destruction, David Heinemeier Hansson, disruptive innovation, en.wikipedia.org, factory automation, Googley, index card, industrial cluster, interchangeable parts, inventory management, Jeff Bezos, John Markoff, Kevin Kelly, loose coupling, low cost airline, market design, minimum viable product, more computing power than Apollo, profit maximization, Richard Florida, Ruby on Rails, self-driving car, shareholder value, side project, Silicon Valley, skunkworks, software as a service, South of Market, San Francisco, Steve Jobs, Steven Levy, Stewart Brand, The Wealth of Nations by Adam Smith, Tony Hsieh, Toyota Production System, Vanguard fund, web application, WikiLeaks, Zipcar

Then, when he began seeing the things I could do onscreen, he watched for about a minute and started jumping around the room, shouting, ‘Why aren’t you doing anything with this? This is the greatest thing. This is revolutionary!’” Jobs went back to Apple, and the rest is history. Xerox may have learned its lesson. Today, the company is focused on moving from being a copier company to a services company. Since 2006, revenue from services—such as outsourcing its customers’ document management and other business processes—has risen from 25% to almost 50%. The jury is still out, but Xerox may be turning itself around. How Kodak Faded Away Kodak introduced one of the first consumer cameras in history, in 1888, with the slogan, “You press the button, we do the rest.” For 100 years, it sold cameras and film. Its highly profitable business was based on the classic “give away the razor and sell the blades” strategy: it sold cheap, easy-to-use cameras and reaped profits from the film business over time.

We have several hundred services, several thousand systems. That’s just the one region in the U.S. and then there’s another thousand in Europe that are connected in various ways. It’s actually a bit cleaner and easier to figure out but it’s still quite complex. Every team is throwing out new versions asynchronously and managing it and what you end up with is this chaotic system that’s actually quite resilient. Unlike many business processes that are designed to be efficient, closed systems, complex systems like Netflix’s are designed to be resilient. This means they continue to work even when many of the parts are broken. If a wheel falls off of your car, you can’t keep going. You have to stop. But when a Netflix service breaks, the system as a whole continues to function without that part, because the system is designed to be failure tolerant.

Process to Pod Traditionally, it’s been the job of managers to coordinate activity across divisions or lines of business, because processes are usually complex and interdependent. Making changes in one part of the process might solve a problem for that unit but cause problems for others. The goal of podular design is to reduce that interdependency by enabling autonomous teams to focus on clear outcomes that deliver value to customers. Chains Versus Nets You can think of any business process as a chain: a series of steps that people go through to get things done. Processes don’t depend on the intelligence or creativity of the people who run them, so much as their consistency and ability to perform a specialized task. The manager of the process is responsible for the intelligence of the system. A process is like a recipe. Recipes are fine as long as you want to achieve the same result every time.


The Trade Lifecycle: Behind the Scenes of the Trading Process (The Wiley Finance Series) by Robert P. Baker

asset-backed security, bank run, banking crisis, Basel III, Black-Scholes formula, Brownian motion, business continuity plan, business process, collapse of Lehman Brothers, corporate governance, credit crunch, Credit Default Swap, diversification, fixed income, hiring and firing, implied volatility, interest rate derivative, interest rate swap, locking in a profit, London Interbank Offered Rate, margin call, market clearing, millennium bug, place-making, prediction markets, short selling, statistical model, stochastic process, the market place, the payments system, time value of money, too big to fail, transaction costs, value at risk, Wiener process, yield curve, zero-coupon bond

There are two noticeable features: IT has a relationship with all other business functions The other business functions do not tend to communicate with one other. 256 THE TRADE LIFECYCLE Regulatory authorities Management Audit Operations IT Systems Finance Front Office Legal Product Control Market risk control Counterparty risk control FIGURE 19.1 IT in the middle This puts IT in a unique position carrying high responsibility. The burden of investigating and improving workflows and business processes often falls to IT. This can even be when there is no need for a new IT system to solve the problem. We know of several cases where IT has improved the business simply by alerting one business function to a process already in existence in another or by getting two business functions to streamline their processes to take notice of each other rather than acting independently. Taking an overall view of current practices can lead to rationalisation and optimisation, and very often the only people who see this are those working in IT.

Ownership means assignment of responsibility. Once that is accomplished, responsibility must be undertaken and followed through to the completion of the project. Proper management should ensure that problems come to light early and are resolved. Communication is essential to ensure all of this occurs. Investigation to uncover real problems An IT system is generally built to solve a business problem or facilitate a business process. IT has a responsibility to uncover the real problem it is trying to solve before embarking on development. Sometimes it is discovered that a solution to a similar problem already exists or that re-using existing IT components is sufficient without the need for new work; IT is often the only department with such knowledge. The business expects IT not to squander time and money unnecessarily.

The two groups can work independently, collaboratively or somewhere in between. Some quants aid the traders with pricing and risk management while others are involved in the control function helping to quantify market and counterparty risk exposures. PART Four Behind the Scenes CHAPTER 21 Developing Processes for New Products (and Improving Processes for Existing Products) nvestment banking is an evolving business. Processes are continually required to solve new problems or improve existing practices. Sometimes changes come because of the desire to trade new products, other times regulators may impose new requirements or the need to catch up or overtake competitors forces banks to consider change. Here we consider processes. Note that the term ‘process’ is agnostic – it could be something carried out by computers or by human beings.


Mastering Private Equity by Zeisberger, Claudia,Prahl, Michael,White, Bowen, Michael Prahl, Bowen White

asset allocation, backtesting, barriers to entry, Basel III, business process, buy low sell high, capital controls, carried interest, commoditize, corporate governance, corporate raider, correlation coefficient, creative destruction, discounted cash flows, disintermediation, disruptive innovation, distributed generation, diversification, diversified portfolio, family office, fixed income, high net worth, information asymmetry, intangible asset, Lean Startup, market clearing, passive investing, pattern recognition, performance metric, price mechanism, profit maximization, risk tolerance, risk-adjusted returns, risk/return, shareholder value, Sharpe ratio, Silicon Valley, sovereign wealth fund, statistical arbitrage, time value of money, transaction costs

The best VC funds will therefore draw on a strong bench of partners, who not only have an intimate understanding of the challenges faced by their portfolio companies, but also come with their own hard-earned experience to give credible advice. Venture partners mentor management teams, help develop the marketability of a start-up’s product or service, identify and fill holes in its team, and facilitate the development of business processes required to scale up. Venture capitalists are also a key resource for start-ups when raising new rounds of capital, both in shaping the fundraising message and identifying potential investors in their network. SYNDICATED DEALS: While “club deals”10 are rare in growth equity and buyouts, venture rounds are quite often funded by multiple VCs. Typically, a lead investor will engage with the entrepreneur and founder, conduct due diligence, arrive at a valuation, negotiate terms and commit to funding a portion of the round.

VALUE CREATION Whether a mature SME, a VC-backed company or a corporate spin-off, growth equity portfolio companies share similar levers for value creation. As growth equity investors rarely employ debt to magnify returns on their equity stake, their focus will be on driving change at the operating company (through strategic, operational and financial initiatives), or professionalization and governance optimization, as shown in Exhibit 3.21 Exhibit 3.2 Value Creation in Growth Equity Professionalizing governance and business processes provides the necessary backbone to execute value creation initiatives. Given the initially lean set-up of VC-backed companies and the resource constraints in SMEs, many of the structures and processes governing their business operations and decision-making have previously been implemented in an ad-hoc fashion. Therefore, improving reporting structures and information flow, and professionalizing the management of both human resources and capital is essential for these companies to consolidate their advantage and enable the next stage of growth.

The situation often requires the existing management to be replaced or at a minimum to be complemented with a few seasoned experts with industry and/or turnaround experience to stabilize the business and reassure debt holders, suppliers and customers of the changes to come. With a clear understanding of the time at its disposal, turnaround investors will look for low hanging fruits to solve the cash flow shortage, improve operating performance and rapidly turn the cash flow positive. Once the company’s existing business processes have been stabilized and the threat of immediate failure has been removed, the PE team will shift its sights to improving the productivity of its assets and allocating capital and resources to restore the company back to a sustainable going concern. Ensuring survival in the short term and recovery in the long term is the target. Distressed Debt Investing Distressed debt funds acquire stakes in the debt obligations of companies in financial distress to generate returns either through the appreciation of the debt or an eventual restructuring of the target company.


pages: 348 words: 97,277

The Truth Machine: The Blockchain and the Future of Everything by Paul Vigna, Michael J. Casey

3D printing, additive manufacturing, Airbnb, altcoin, Amazon Web Services, barriers to entry, basic income, Berlin Wall, Bernie Madoff, bitcoin, blockchain, blood diamonds, Blythe Masters, business process, buy and hold, carbon footprint, cashless society, cloud computing, computer age, computerized trading, conceptual framework, Credit Default Swap, crowdsourcing, cryptocurrency, cyber-physical system, dematerialisation, disintermediation, distributed ledger, Donald Trump, double entry bookkeeping, Edward Snowden, Elon Musk, Ethereum, ethereum blockchain, failed state, fault tolerance, fiat currency, financial innovation, financial intermediation, global supply chain, Hernando de Soto, hive mind, informal economy, intangible asset, Internet of things, Joi Ito, Kickstarter, linked data, litecoin, longitudinal study, Lyft, M-Pesa, Marc Andreessen, market clearing, mobile money, money: store of value / unit of account / medium of exchange, Network effects, off grid, pets.com, prediction markets, pre–internet, price mechanism, profit maximization, profit motive, ransomware, rent-seeking, RFID, ride hailing / ride sharing, Ross Ulbricht, Satoshi Nakamoto, self-driving car, sharing economy, Silicon Valley, smart contracts, smart meter, Snapchat, social web, software is eating the world, supply-chain management, Ted Nelson, the market place, too big to fail, trade route, transaction costs, Travis Kalanick, Turing complete, Uber and Lyft, uber lyft, unbanked and underbanked, underbanked, universal basic income, web of trust, zero-sum game

Here is sampling of possible use cases, and it is by no means an exhaustive list: •  Inviolable property registries, which people can use to prove that they own their houses, cars, or other assets; •  Real-time, direct, bank-to-bank settlement of securities exchanges, which could unlock trillions of dollars in an interbank market that currently passes such transactions through dozens of specialized institutions in a process that takes two to seven days; •  Self-sovereign identities, which don’t depend on a government or a company to assert a person’s ID; •  Decentralized computing, which supplants the corporate business of cloud computing and Web hosting with the hard drives and processing power of ordinary users’ computers; •  Decentralized Internet of Things transactions, where devices can securely talk and transact with each other without the friction of an intermediary, making possible big advances in transportation and decentralized energy grids; •  Blockchain-based supply chains, in which suppliers use a common data platform to share information about their business processes to greatly improve accountability, efficiency, and financing with the common purpose of producing a particular good; •  Decentralized media and content, which would empower musicians and artists—and, in theory, anyone who posts information of value to the Net—to take charge of their digital content, knowing they can track and manage the use of this “digital asset.” Blockchain technology could help achieve what some commentators are calling the promise of “Internet 3.0,” a re-architecting of the Net to assert the core objective of decentralization that inspired many of the early online pioneers who built the Internet 1.0.

Foxconn rolled out a prototype for the thousands of suppliers in its various value chains, and not long after the company said that the prototype’s use had generated $6.5 million in loans for them. A more radical way to extract value from blockchain solutions in supply chains would involve the issuance of unique tokens of the kind discussed in the previous chapter, special digital assets that represent goods and services moving along a supply chain. This has the potential to bring flexibility to business dealings in the export-import field and innovate new business processes. Tokenization, when combined with GPS data and other information recorded in a blockchain, would let the owner of goods in transit transfer rights to any buyer anywhere at any time, without the shipment having to be recorded by a port. Companies whose products were among the $14 billion worth of cargo trapped at sea when South Korea’s Hanjin Shipping Co. declared bankruptcy in 2016 might have welcomed this option.

This radical idea introduces a negotiable structure to different phases of the chain. Intermediate goods that would otherwise be encumbered by a pre-established chain of unsettled commitments can instead be put out to bid to see if other buyers want to take on the rights and obligations associated with them. This would attract alternative sources of impromptu demand, which could have a market-clearing effect on resource management. Enhanced visibility on business processes, when coupled with the ability to find liquid markets for goods-linked digital assets, means that industrial actors could be incentivized, like never before, to be both environmentally responsible and profitable. It’s similar to the principle, explored above, of using price signals to optimize a solar microgrid. If tokens allow us to set prices for goods and services for which there was previously no alternative source of demand, producers might be able to make much better resource decisions.


pages: 430 words: 68,225

Blockchain Basics: A Non-Technical Introduction in 25 Steps by Daniel Drescher

bitcoin, blockchain, business process, central bank independence, collaborative editing, cryptocurrency, disintermediation, disruptive innovation, distributed ledger, Ethereum, ethereum blockchain, fiat currency, job automation, linked data, peer-to-peer, place-making, Satoshi Nakamoto, smart contracts, transaction costs

Hence, the more the blockchain is used, the more transactions and interactions between contracting parties will be standardized. So fostering standardization of peer interactions could be another long-term accomplishment of the blockchain. Streamlining Processes As a consequence of standardization and automation, business processes will become more transparent and streamlined. Many organizations reviewed and analyzed their business processes as a side effect of preparing themselves for transition to the blockchain. Hence, the review of existing business processes and redesigning and streamlining them could be another accomplishment of the blockchain that may persist. Increased Processing Speed Disintermediation, standardization, streamlined processes, and automation lead to a significant speed up of processes. Hence, one can expect that the more the blockchain is used, the more timely transactions and interactions between contracting parties will be executed.


pages: 251 words: 66,396

The E-Myth Revisited: Why Most Small Businesses Don't Work and What to Do About It by Michael E. Gerber

business process, interchangeable parts, Silicon Valley

“Because what McDonald’s knows, and what Federal Express knows, and what Disney knows—indeed, what every extraordinary business knows—is that the customer you’ve got is one hell of a lot less expensive to sell to than the customer you don’t have yet. “And that’s why the business process of Lead Generation, Lead Conversion, and Client Fulfillment is so critical to the growth of your business. And that’s what marketing is. The whole process. Not just a part of it but the entire thing. “And it never stops! “And so, while the VP/Marketing and the VP/Operations and the VP/Finance each have their own specific accountabilities, they share one common purpose—to make a promise their customer wants to hear, and to deliver on that promise better than anyone else on the block! “And the place where they join each other is at the position of COO. The COO is the driver of all this. The COO connects each part of the business process. The COO maintains the integrity of the whole by acting as the arbiter of the Strategic Objective he is accountable for fulfilling, of the rules of the game he is accountable for maintaining, of the game the business has chosen to play.

“The COO must continue to ask marketing questions. “The VP/Marketing is absolutely accountable for asking marketing questions. “In fact, there isn’t a function or position within the company that is free of asking marketing questions, if by marketing we mean, ‘What must our business be in the mind of our customers in order for them to choose us over everyone else?’ “And so, seen from the appropriate perspective, the entire business process by which your company does what it does is a marketing process. “It starts with the promise you make to attract them to your door. “It continues with the sale you make once they get there. “And it ends with the delivery of the promise before they leave your door. “In some companies that process is called Lead Generation, Lead Conversion, Client Fulfillment. “In your business, Sarah, it’s called Marketing, Sales, and Operations.


pages: 1,073 words: 314,528

Strategy: A History by Lawrence Freedman

Albert Einstein, anti-communist, Anton Chekhov, Ayatollah Khomeini, barriers to entry, battle of ideas, Black Swan, British Empire, business process, butterfly effect, centre right, Charles Lindbergh, circulation of elites, cognitive dissonance, coherent worldview, collective bargaining, complexity theory, conceptual framework, corporate raider, correlation does not imply causation, creative destruction, cuban missile crisis, Daniel Kahneman / Amos Tversky, defense in depth, desegregation, Edward Lorenz: Chaos theory, en.wikipedia.org, endogenous growth, endowment effect, Ford paid five dollars a day, framing effect, Frederick Winslow Taylor, Gordon Gekko, greed is good, information retrieval, interchangeable parts, invisible hand, John Nash: game theory, John von Neumann, Kenneth Arrow, lateral thinking, linear programming, loose coupling, loss aversion, Mahatma Gandhi, means of production, mental accounting, Murray Gell-Mann, mutually assured destruction, Nash equilibrium, Nelson Mandela, Norbert Wiener, Norman Mailer, oil shock, Pareto efficiency, performance metric, Philip Mirowski, prisoner's dilemma, profit maximization, race to the bottom, Ralph Nader, RAND corporation, Richard Thaler, road to serfdom, Ronald Reagan, Rosa Parks, shareholder value, social intelligence, Steven Pinker, strikebreaker, The Chicago School, The Myth of the Rational Market, the scientific method, theory of mind, Thomas Davenport, Thomas Kuhn: the structure of scientific revolutions, Torches of Freedom, Toyota Production System, transaction costs, ultimatum game, unemployed young men, Upton Sinclair, urban sprawl, Vilfredo Pareto, War on Poverty, women in the workforce, Yogi Berra, zero-sum game

The Rhetorical Appeal of a Managerial Salvation Device,” Journal of Management Studies 35, no. 4 (July 1991): 419–441. 19. Michael Hammer, “Reengineering Work: Don’t Automate, Obliterate,” Harvard Business Review, July/August 1990, 104. 20. Thomas Davenport and James Short, “The New Industrial Engineering: Information Technology and Business Process Redesign,” Sloan Management Review, Summer 1990; Keith Grint, “Reengineering History: Social Resonances and Business Process Reengineering,” Organization 1, no. 1 (1994): 179–201; Keith Grint and P. Case, “The Violent Rhetoric of Re-Engineering: Management Consultancy on the Offensive,” Journal of Management Studies 6, no. 5 (1998): 557–577. 21. Bradley G. Jackson, “Re-Engineering the Sense of Self: The Manager and the Management Guru,” Journal of Management Studies 33, no. 5 (September 1996): 571–590. 22.

Their success would depend on an ability to get the best out of those beneath them in the hierarchy, but unlike the military chain of command (with which comparisons were natural), there was likely to be a greater range of functions to be coordinated and less reliance on unquestioning obedience. The notion that management was a new profession of increasing importance, essential to the performance of modern businesses, was recognized in the establishment of business schools. The first was the Wharton School at Pennsylvania, founded in 1881. The management in question, however, was of potentially unruly workforces as much as complex business processes. The “labor issue” was a major preoccupation. Joseph Wharton wished the school to teach “the nature and prevention of strikes” as well as “the necessity for modern industry of organizing under single leaders or employers great amounts of capital and great numbers of laborers, and of maintaining discipline among the latter.”1 A quarter of a century passed before the Harvard Business School opened in 1908.

The energy company Enron was the prize exhibit of the latter possibility. This risk was greatest in areas that were hard to grasp, whether because of the sophistication of the financial instruments or the potential of the new technologies. Within companies, any activities that might be holding down the price, not providing the value that was being extracted elsewhere, came to be targeted. Thus they encouraged remorseless cost cutting. Business Process Re-engineering The Japanese success over the postwar decades could be taken as a triumph of a focused, patient, coherent, and consensual culture, a reflection of dedicated operational efficiency or else a combination of the two. Either way, the pacesetter was the car manufacturer, Toyota. Having spent the Second World War building military vehicles, the company struggled after the war to get back into the commercial market.


pages: 660 words: 141,595

Data Science for Business: What You Need to Know About Data Mining and Data-Analytic Thinking by Foster Provost, Tom Fawcett

Albert Einstein, Amazon Mechanical Turk, big data - Walmart - Pop Tarts, bioinformatics, business process, call centre, chief data officer, Claude Shannon: information theory, computer vision, conceptual framework, correlation does not imply causation, crowdsourcing, data acquisition, David Brooks, en.wikipedia.org, Erik Brynjolfsson, Gini coefficient, information retrieval, intangible asset, iterative process, Johann Wolfgang von Goethe, Louis Pasteur, Menlo Park, Nate Silver, Netflix Prize, new economy, p-value, pattern recognition, placebo effect, price discrimination, recommendation engine, Ronald Coase, selection bias, Silicon Valley, Skype, speech recognition, Steve Jobs, supply-chain management, text mining, The Signal and the Noise by Nate Silver, Thomas Bayes, transaction costs, WikiLeaks

Raeder et al. (2012) present a detailed discussion of system design to help deal with these and other related evaluation-in-deployment issues. Deployment In deployment the results of data mining—and increasingly the data mining techniques themselves—are put into real use in order to realize some return on investment. The clearest cases of deployment involve implementing a predictive model in some information system or business process. In our churn example, a model for predicting the likelihood of churn could be integrated with the business process for churn management—for example, by sending special offers to customers who are predicted to be particularly at risk. (We will discuss this in increasing detail as the book proceeds.) A new fraud detection model may be built into a workforce management information system, to monitor accounts and create “cases” for fraud analysts to examine.

Be Ready to Accept Creative Ideas from Any Source Once different role players understand fundamental principles of data science, creative ideas for new solutions can come from any direction—such as from executives examining potential new lines of business, from directors dealing with profit and loss responsibility, from managers looking critically at a business process, and from line employees with detailed knowledge of exactly how a particular business process functions. Data scientists should be encouraged to interact with employees throughout the business, and part of their performance evaluation should be based on how well they produce ideas for improving the business with data science. Incidentally, doing so can pay off in unintended ways: the data processing skills possessed by data scientists often can be applied in ways that are not so sophisticated but nevertheless can help other employees without those skills.

Regression Analysis Some of the same methods we discuss in this book are at the core of a different set of analytic methods, which often are collected under the rubric regression analysis, and are widely applied in the field of statistics and also in other fields founded on econometric analysis. This book will focus on different issues than usually encountered in a regression analysis book or class. Here we are less interested in explaining a particular dataset as we are in extracting patterns that will generalize to other data, and for the purpose of improving some business process. Typically, this will involve estimating or predicting values for cases that are not in the analyzed data set. So, as an example, in this book we are less interested in digging into the reasons for churn (important as they may be) in a particular historical set of data, and more interested in predicting which customers who have not yet left would be the best to target to reduce future churn.


Principles of Protocol Design by Robin Sharp

accounting loophole / creative accounting, business process, discrete time, fault tolerance, finite state, Gödel, Escher, Bach, information retrieval, loose coupling, MITM: man-in-the-middle, packet switching, RFC: Request For Comment, stochastic process

The complete architecture of the Web Services protocol stack is illustrated conceptually in Figure 11.24. The function of the uppermost layer, associated with Service Flow, is to make it possible to compose simpler web services into more complex ones. A major aim of this is to be able to provide services for performing complete business processes, in which documents from various sources are passed round and processed in some way. One of the main candidates for use in this layer, Business Process Execution Language (BPEL), of which the latest version is known as WS-BPEL [265], focusses directly on this issue. However, the way in which this layer works is 364 11 Application Protocols currently not completely standardised among various suppliers of Web services, and we shall not go into more details about it here.

.: On distributed communication networks. IEEE Trans. on Communications CS-12, 1–9 (1964) 5. Bartlett, K.A., Scantelbury, R.A., Wilkinson, P.T.: A note on reliable full-duplex transmission over half-duplex links. Commun. ACM 12(5), 260–261 (1969) 6. Baumann, J.: Mobile Agents: Control Algorithms, Lecture Notes in Computer Science, vol. 1658. Springer-Verlag (2000) 7. BEA, IBM, Microsoft, SAP AG, Siebel Systems: Business Process Execution Language for Web Services Version 1.1 (2003) 8. Bellovin, S.: Internet RFC 1948: Defending Against Sequence Number Attacks (1996) 9. Bernstein, P.A., Goodman, N.: Concurrency control in distributed database systems. ACM Comput. Surv. 13(2), 185–221 (1981) 10. Bernstein, P.A., Shipman, D.W., Rothnie, J.B.: Concurrency control in a system for distributed databases (SDD-1). ACM Trans.

National Institute of Standards and Technology: Federal Information Processing Standard Publication 180–2: Secure Hash Standard (2002) 261. OASIS: Web Services Security: Username Token Profile 1.0 (2003) 262. OASIS: UDDI Spec Technical Committee Specification: UDDI Version 3.0.2 (2004) 263. OASIS: Web Services Security: SOAP Message Security 1.0 (2004) 264. OASIS: Web Services Security: X.509 Certificate Token Profile (2004) 265. OASIS: Web Services Business Process Execution Language Version 2.0 (2007) 266. W3C: Canonical XML (2001). This is identical to Internet RFC3076 267. W3C: XML Schema Part 1: Structures (2001) 388 References 268. 269. 270. 271. 272. 273. 274. 275. 276. 277. W3C: XML Schema Part 2: Datatypes (2001) W3C: XML Encryption Syntax and Processing (2002) W3C: XML-Signature Syntax and Processing (2002). This is identical to Internet RFC3275 W3C: Extensible Markup Language (XML) 1.0, third edn. (2004) W3C: Namespaces in XML 1.1 (2004) W3C: SOAP Version 1.2 Part 0: Primer (Second Edition) (2007) W3C: SOAP Version 1.2 Part 1: Messaging Framework (Second Edition) (2007) W3C: SOAP Version 1.2 Part 2: Adjuncts (Second Edition) (2007) W3C: Web Services Description Language (WSDL) Version 2.0.


pages: 244 words: 76,192

Execution: The Discipline of Getting Things Done by Larry Bossidy

Albert Einstein, business process, complexity theory, Iridium satellite, Long Term Capital Management, NetJets, old-boy network, shareholder value, six sigma, social software, Socratic dialogue, supply-chain management

Other disciplines have no shortage of accumulated knowledge and literature. Strategy? So much thinking has gone into strategy that it’s no longer an intellectual challenge. You can rent any strategy you want from a consulting firm. Leadership development? The literature on it is endless. Innovation? Ditto. Nor is there any shortage of tools and techniques that can help leaders get things done—approaches to organization structure and incentive systems, business process design, methodologies for promoting people, guides to culture change. We talk to many leaders who fall victim to the gap between promises they’ve made and results their organizations delivered. They frequently tell us they have a problem with accountability—people aren’t doing the things they’re supposed to do to implement a plan. They desperately want to make changes of some kind, but what do they need to change?

In its total impact on the company, Brown’s reorganization was far bigger and more complex than the one that brought Xerox to its knees. Brown essentially turned EDS upside down. The SBUs were rolled into a new organization of four lines of business (LOBs) centered on broad market segments. E Solutions would offer a complete range of services for the “extended enterprise,” linked electronically with suppliers and clients, from supply chain networks to Internet security. Business Process Management would provide businesses and governments with administrative and financial processing and client relationship management. Information solutions would sell IT and communications outsourcing, managed storage, and management of desktop systems. And A.T. Kearney would specialize in high-end consulting, along with executive search services. (EDS has since added a fifth LOB, PLM Solutions, which offers digitized product life cycle management—from development to collaboration with suppliers—for manufacturing companies.)

We’ll have to do some rigorous things. You’re making the right decision, and we’ll be very fair with you.” And we were. BUILDING BLOCK FOUR: LINKING HR TO BUSINESS RESULTS If you’re starting to think that human resources is less important in an execution culture, let us correct that impression. It’s more important than ever but its role has to change radically. HR has to be integrated into the business processes. It has to be linked to strategy and operations, and to the assessments that the line people ultimately make about people. In this new role, HR becomes recruitment-oriented and a far more powerful force for advancing the organization than it was in its typical staff function. As Don Redlinger, the senior vice president of HR at Honeywell International, explains, “The paradox in working for somebody like Bossidy is that he’s the CFO and the chief human resources officer and the chief strategist, but he has such a systemic view of how you make an organization perform that human resources people prosper in that environment.


pages: 297 words: 77,362

The Nature of Technology by W. Brian Arthur

Andrew Wiles, business process, cognitive dissonance, computer age, creative destruction, double helix, endogenous growth, Geoffrey West, Santa Fe Institute, haute cuisine, James Watt: steam engine, joint-stock company, Joseph Schumpeter, Kenneth Arrow, Kevin Kelly, knowledge economy, locking in a profit, Mars Rover, means of production, Myron Scholes, railway mania, Silicon Valley, Simon Singh, sorting algorithm, speech recognition, technological singularity, The Wealth of Nations by Adam Smith, Thomas Kuhn: the structure of scientific revolutions

They think in terms of purposes and work these backwards into individual operations in their mental world, much as a composer works a musical theme back into the instrumental parts that will express it. A domain is also a world in another sense. It is a realm that its users, not necessarily designers, can reach into to carry out mundane tasks, a world where certain manipulations are possible. The procedure for use is always the same. Some object (or activity or business process) is physically entered into a world. Image processing specialists literally enter an image into “digital world” by scanning it into the computer, or photographing it digitally. Once there the object is passed from one operation to another, worked on, transformed, and sometimes combined with other activities and objects within that world. In digital world an image becomes numerical data, so it can be subjected to mathematical manipulations that correspond to color-correction, sharpening, desaturation, distortion to give a wide-lens effect, the addition of a background.

I would prefer to say that the elements of the economy—industries, firms, business practices—do not so much “adopt” a new body of technology; they encounter it. And from this encounter, new processes, new technologies, and new industries are born as a result. How does this happen? Think of the new body of technology as its methods, devices, understandings, and practices. And think of a particular industry as comprised of its organizations and business processes, its production methods and physical equipment. All these are technologies in the wide sense I talked of earlier. These two collections of individual technologies—one from the new domain, and the other from the particular industry—come together and encounter each other. And new combinations form as a result. Thus, when the banking industry encountered computation in the 1960s, we could loosely say that it “adopted” computation for its bookkeeping and accounting activities.

Reflecting this, the economy—the high-tech part of it, at least—is more about the putting together of things than about the refining of fixed operations. Business operations—commercial banks, oil companies, insurance companies—of course still reflect the era of large, fixed technologies. But increasingly, as with the operations of putting together a startup company, or venture capital, or financial derivatives, or digitization, or combinatorial biology, they are about combining functionalities—actions and business processes—for short-term reconfigurable purposes. The economy, in a word, is becoming generative. Its focus is shifting from optimizing fixed operations into creating new combinations, new configurable offerings. For the entrepreneur creating these new combinations in a startup company, little is clear. He often does not know who his competitors will be. He does not know how well the new technology will work, or how it will be received.


pages: 208 words: 37,561

Manage Your Home Build & Renovation Project: How to Create Your Dream Home on Time, in Budget and Without Stress by David Cambridge

business process, call centre

I have already outlined in the previous section that skipping aspects of the project is a massive risk therefore if you are truly serious about protecting what is important to you; you have to be prepared to do things right throughout the course of the project. It is no good starting out full of good intentions only to become lazy along the way, be professional. If this was your job you would be governed by business processes and systems, there are correct ways of doing things and you must be accountable. You cannot go and just spend your employers’ money without the necessary authority and approval so treat your project in exactly the same way. Why not even make this commitment to yourself now? I…………………………………………………………….. commit myself to undertake this project in a professional, disciplined manner from Start to Finish.

Were they looking for items of extra works from the start? Did they appear to have a sharp commercial angle? THE TENDER RETURN Tender offers should be returned fully in accordance with the requirements of the tender invite and on time, using the required document formats completed in a clear and well-presented manner. This will be an immediate indicator that they are serious about working on the project and how reliable their business processes are. If individual bidders fail to provide the necessary detail in their returns then you need to seriously consider their ability or desire for the works. DEALING WITH TENDER CLARIFICATIONS You should allow the builders to be able to submit queries and clarifications relating to the tender documentation. You can allow this through email but make sure that any details or possible variations are fully recorded and where possible noted for discussion and inclusion within the final Building Contract.


pages: 721 words: 197,134

Data Mining: Concepts, Models, Methods, and Algorithms by Mehmed Kantardzić

Albert Einstein, bioinformatics, business cycle, business intelligence, business process, butter production in bangladesh, combinatorial explosion, computer vision, conceptual framework, correlation coefficient, correlation does not imply causation, data acquisition, discrete time, El Camino Real, fault tolerance, finite state, Gini coefficient, information retrieval, Internet Archive, inventory management, iterative process, knowledge worker, linked data, loose coupling, Menlo Park, natural language processing, Netflix Prize, NP-complete, PageRank, pattern recognition, peer-to-peer, phenotype, random walk, RFID, semantic web, speech recognition, statistical model, Telecommunications Act of 1996, telemarketer, text mining, traveling salesman, web application

Although the implementation of a data warehouse is a complex task, described in many texts in great detail, in this text we are giving only the basic characteristics. A three-stage data-warehousing development process is summarized through the following basic steps: 1. Modeling. In simple terms, to take the time to understand business processes, the information requirements of these processes, and the decisions that are currently made within processes. 2. Building. To establish requirements for tools that suit the types of decision support necessary for the targeted business process; to create a data model that helps further define information requirements; to decompose problems into data specifications and the actual data store, which will, in its final form, represent either a data mart or a more comprehensive data warehouse. 3. Deploying. To implement, relatively early in the overall process, the nature of the data to be warehoused and the various business intelligence tools to be employed; to begin by training users.

Since data mining is a natural activity to be performed on large data sets, one of the largest target markets is the entire data-warehousing, data-mart, and decision-support community, encompassing professionals from such industries as retail, manufacturing, telecommunications, health care, insurance, and transportation. In the business community, data mining can be used to discover new purchasing trends, plan investment strategies, and detect unauthorized expenditures in the accounting system. It can improve marketing campaigns and the outcomes can be used to provide customers with more focused support and attention. Data-mining techniques can be applied to problems of business process reengineering, in which the goal is to understand interactions and relationships among business practices and organizations. Many law enforcement and special investigative units, whose mission is to identify fraudulent activities and discover crime trends, have also used data mining successfully. For example, these methodologies can aid analysts in the identification of critical behavior patterns, in the communication interactions of narcotics organizations, the monetary transactions of money laundering and insider trading operations, the movements of serial killers, and the targeting of smugglers at border crossings.

They are usually special-purpose visualization tools that can help end users draw their own conclusions and decisions, based on graphically condensed data. OLAP tools are very useful for the data-mining process; they can be a part of it, but they are not a substitute. 1.6 BUSINESS ASPECTS OF DATA MINING: WHY A DATA-MINING PROJECT FAILS Data mining in various forms is becoming a major component of business operations. Almost every business process today involves some form of data mining. Customer Relationship Management, Supply Chain Optimization, Demand Forecasting, Assortment Optimization, Business Intelligence, and Knowledge Management are just some examples of business functions that have been impacted by data mining techniques. Even though data mining has been successful in becoming a major component of various business and scientific processes as well as in transferring innovations from academic research into the business world, the gap between the problems that the data mining research community works on and real-world problems is still significant.


pages: 292 words: 85,151

Exponential Organizations: Why New Organizations Are Ten Times Better, Faster, and Cheaper Than Yours (And What to Do About It) by Salim Ismail, Yuri van Geest

23andMe, 3D printing, Airbnb, Amazon Mechanical Turk, Amazon Web Services, augmented reality, autonomous vehicles, Baxter: Rethink Robotics, Ben Horowitz, bioinformatics, bitcoin, Black Swan, blockchain, Burning Man, business intelligence, business process, call centre, chief data officer, Chris Wanstrath, Clayton Christensen, clean water, cloud computing, cognitive bias, collaborative consumption, collaborative economy, commoditize, corporate social responsibility, cross-subsidies, crowdsourcing, cryptocurrency, dark matter, Dean Kamen, dematerialisation, discounted cash flows, disruptive innovation, distributed ledger, Edward Snowden, Elon Musk, en.wikipedia.org, Ethereum, ethereum blockchain, game design, Google Glasses, Google Hangouts, Google X / Alphabet X, gravity well, hiring and firing, Hyperloop, industrial robot, Innovator's Dilemma, intangible asset, Internet of things, Iridium satellite, Isaac Newton, Jeff Bezos, Joi Ito, Kevin Kelly, Kickstarter, knowledge worker, Kodak vs Instagram, Law of Accelerating Returns, Lean Startup, life extension, lifelogging, loose coupling, loss aversion, low earth orbit, Lyft, Marc Andreessen, Mark Zuckerberg, market design, means of production, minimum viable product, natural language processing, Netflix Prize, NetJets, Network effects, new economy, Oculus Rift, offshore financial centre, PageRank, pattern recognition, Paul Graham, paypal mafia, peer-to-peer, peer-to-peer model, Peter H. Diamandis: Planetary Resources, Peter Thiel, prediction markets, profit motive, publish or perish, Ray Kurzweil, recommendation engine, RFID, ride hailing / ride sharing, risk tolerance, Ronald Coase, Second Machine Age, self-driving car, sharing economy, Silicon Valley, skunkworks, Skype, smart contracts, Snapchat, social software, software is eating the world, speech recognition, stealth mode startup, Stephen Hawking, Steve Jobs, subscription business, supply-chain management, TaskRabbit, telepresence, telepresence robot, Tony Hsieh, transaction costs, Travis Kalanick, Tyler Cowen: Great Stagnation, uber lyft, urban planning, WikiLeaks, winner-take-all economy, X Prize, Y Combinator, zero-sum game

As an analog to MTPs, we also see a worldwide increase in social enterprises. A study by the G8 in 2013 estimates there are 688,000 social enterprises, generating $270 billion annually. These organizations come in many forms (Benefit or B Corporations, Triple Bottom Line, L3Cs, the Conscious Capital movement, the Slow Money movement) and leverage their MTPs to integrate social and environmental issues—as well as profits—into their business processes. This trend started with the rise of corporate social responsibility (CSR) programs in organizations. In 2012, 57 percent of the Fortune 500 published a CSR report—double the number from the previous year. The difference is that CSR initiatives are add-ons to most companies’ core business; for social enterprises, CSR initiatives are the core business. Martin Seligman, a leading expert on positive psychology, differentiates between three states of happiness: the pleasurable life (hedonistic, superficial), the good life (family and friends) and the meaningful life (finding purpose, transcending ego, working toward a higher good).

Bill Fischer, co-author with Umberto Lago and Fang Liu of the book Reinventing Giants: How Chinese Global Competitor Haier Has Changed the Way Big Companies Transform, makes the important observation that the “business model and corporate culture are inextricably linked.” The authors tracked Haier for over a decade, along the way identifying four key stages that large organizations must navigate to reinvent their cultures: Build quality Diversify Re-engineer the business process Reduce distance to customer Zhan Ruimin, a former Haier administrator who was appointed CEO by the Chinese state in 1984, implemented the quality-building step early on in his tenure. A famous anecdote has him handing out sledgehammers and joining staffers in destroying a few dozen subpar refrigerators. His next move was to diversify into other home appliances. In 2005, Zhan decided to shred Haier’s entire middle management layer and reorganize the company’s 80,000 employees into 2,000 ZZJYTs, a Chinese acronym for independent, self-managed units, each having a P&L, where team members are paid on performance [Autonomy].

* ( ) No, we use traditional quarterly/annual performance reviews or 360 reviews or stack ranking ( ) We have implemented OKRs in innovation areas or at the edges of the organization ( ) OKRs are used across our organization (e.g. LinkedIn) ( ) OKRs are used across our organization with full transparency (e.g. Google - everyone can view each others’ performance) Experimentation & Risk 16) Does your organization constantly optimize processes through experimentation, A/B testing and short feedback loops? (e.g. Lean Startup methodology)* ( ) No, we use traditional business process management (BPM) ( ) We use the Lean approach (or similar) for customer facing areas like marketing ( ) We use the Lean approach for product innovation and product development ( ) We use the Lean approach for all core functions (innovation, marketing, sales, service, HR, even legal!) 17) To what extent do you tolerate failure and encourage risk-taking?* ( ) Failure is not an option (NASA) and is a Career Limiting Move (CLM) ( ) Failure and Risk are encouraged, but in name only and not tracked or quantified ( ) Failure and risk-taking are allowed and measured, but sandboxed in skunkworks or very defined boundaries (e.g.


pages: 382 words: 120,064

Bank 3.0: Why Banking Is No Longer Somewhere You Go but Something You Do by Brett King

3D printing, additive manufacturing, Airbus A320, Albert Einstein, Amazon Web Services, Any sufficiently advanced technology is indistinguishable from magic, asset-backed security, augmented reality, barriers to entry, bitcoin, bounce rate, business intelligence, business process, business process outsourcing, call centre, capital controls, citizen journalism, Clayton Christensen, cloud computing, credit crunch, crowdsourcing, disintermediation, en.wikipedia.org, fixed income, George Gilder, Google Glasses, high net worth, I think there is a world market for maybe five computers, Infrastructure as a Service, invention of the printing press, Jeff Bezos, jimmy wales, Kickstarter, London Interbank Offered Rate, M-Pesa, Mark Zuckerberg, mass affluent, Metcalfe’s law, microcredit, mobile money, more computing power than Apollo, Northern Rock, Occupy movement, optical character recognition, peer-to-peer, performance metric, Pingit, platform as a service, QR code, QWERTY keyboard, Ray Kurzweil, recommendation engine, RFID, risk tolerance, Robert Metcalfe, self-driving car, Skype, speech recognition, stem cell, telepresence, Tim Cook: Apple, transaction costs, underbanked, US Airways Flight 1549, web application

Big data sizes are a constantly moving target, and as of 2012, range from a few dozen terabytes to many petabytes of data in a single data set. Bitcoin: A type of P2P digital currency. Blog: A contraction of the term “web log”—a type of website usually maintained by an individual with regular entries of commentary, descriptions of events, or other material such as graphics or video. BPO: Business Process Outsourcing—the practice of outsourcing some or all of the business’s back-office processes to an external company or service provider; common with call centres and IT support. BPR: Business Process Re-engineering—re-engineering business processes to either reduce costs or improve the flow of a process for customers. CapEx: Capital Expense CES: Consumer Electronics Show Churn: This refers to customers moving from a service provider within one specific product category to another, based on price, value or some other factor.

Content Management Systems The old dot-com favourite is back, but this time enabled across the organisation so you can “publish” new content continuously. The best analogy is to imagine that your bank is publishing a product catalogue and investor information magazine, based on your product, to customers daily. Sales Intelligence and Automated offer capability Real-time and precognitive offer serving for existing customers delivered in the form of prompts, offers, or service messages, especially within the internet banking portal. BPR (Business Process Re-engineering) on select processes Reduction of layering between sales and service departments, including the removal of duplicate “skills” within “competing” product units. Creation of “customer dynamics” capability as owners of customers, rather than product competing for revenue from same. Straight-Through Processing and Credit Risk Management Systems Enabling customers to get immediate fulfilment for an application rather than waiting the obligatory 24, 48, or 72 hours afterwards due to antiquated manual or human “processes” in the back office.


pages: 624 words: 127,987

The Personal MBA: A World-Class Business Education in a Single Volume by Josh Kaufman

Albert Einstein, Atul Gawande, Black Swan, business cycle, business process, buy low sell high, capital asset pricing model, Checklist Manifesto, cognitive bias, correlation does not imply causation, Credit Default Swap, Daniel Kahneman / Amos Tversky, David Heinemeier Hansson, David Ricardo: comparative advantage, Dean Kamen, delayed gratification, discounted cash flows, Donald Knuth, double entry bookkeeping, Douglas Hofstadter, en.wikipedia.org, Frederick Winslow Taylor, George Santayana, Gödel, Escher, Bach, high net worth, hindsight bias, index card, inventory management, iterative process, job satisfaction, Johann Wolfgang von Goethe, Kevin Kelly, Kickstarter, Lao Tzu, lateral thinking, loose coupling, loss aversion, Marc Andreessen, market bubble, Network effects, Parkinson's law, Paul Buchheit, Paul Graham, place-making, premature optimization, Ralph Waldo Emerson, rent control, side project, statistical model, stealth mode startup, Steve Jobs, Steve Wozniak, subscription business, telemarketer, the scientific method, time value of money, Toyota Production System, tulip mania, Upton Sinclair, Vilfredo Pareto, Walter Mischel, Y Combinator, Yogi Berra

I had no idea that companies like Procter & Gamble even existed until I applied for the job that swept me into the corporate world. Working for P&G was an education in itself. The sheer size and scope of the business—and the complexity required to manage a business of that size—boggled my mind. During my first three years with the company, I participated in decisions across every part of the business process: creating new products, ramping up production, allocating millions of marketing dollars, and securing distribution with major retailers like Walmart, Target, Kroger, and Costco. As an assistant brand manager, I was leading teams of thirty to forty P&G employees, contractors, and agency staff—all of whom had competing projects, plans, and priorities. The stakes were huge and the pressure was intense.

More advertising typically resulted in more distribution, which in turn resulted in more sales and even more money to spend on advertising, continuing the cycle. As decades passed, this self-reinforcing feedback loop resulted in a few dominant behemoths in each industry. Business schools became obsessed with how to capture market share and create gigantic companies quickly via ever-larger mergers, raising the financial stakes with each acquisition. For entrepreneurs, venture capital became a must-have aspect of the business process—how else could you afford to build a factory or a national brand in a few short years? “Economies of scale” in production meant large companies could outcompete smaller rivals by offering similar products at lower prices. Investors wanted to see huge returns on their money quickly, prudence be damned, rewarding speculators who wrote business plans promising a huge exit in a short amount of time.

Sales: How many prospects are becoming paying customers? What is the average customer’s Lifetime Value? Value Delivery: How quickly can you serve each customer? What is your current returns or complaints rate? Finance: What is your Profit Margin ? How much Purchasing Power do you have? Are you financially Sufficient ? Any Measurements directly related to these questions are probably KPIs. Anything that’s not directly related to a core business process or a system’s Throughput is probably not. Try to limit yourself to only three to five KPIs per system. When collecting Measurements, it’s tempting to build yourself a “dashboard” that contains every piece of information you’d ever want to see. Resist the temptation : if you overload yourself with too much data, you’ll be far less likely to see Changes that are critically important. You can always dig deeper into the data at your disposal if necessary.


pages: 464 words: 127,283

Smart Cities: Big Data, Civic Hackers, and the Quest for a New Utopia by Anthony M. Townsend

1960s counterculture, 4chan, A Pattern Language, Airbnb, Amazon Web Services, anti-communist, Apple II, Bay Area Rapid Transit, Burning Man, business process, call centre, carbon footprint, charter city, chief data officer, clean water, cleantech, cloud computing, computer age, congestion charging, connected car, crack epidemic, crowdsourcing, DARPA: Urban Challenge, data acquisition, Deng Xiaoping, digital map, Donald Davies, East Village, Edward Glaeser, game design, garden city movement, Geoffrey West, Santa Fe Institute, George Gilder, ghettoisation, global supply chain, Grace Hopper, Haight Ashbury, Hedy Lamarr / George Antheil, hive mind, Howard Rheingold, interchangeable parts, Internet Archive, Internet of things, Jacquard loom, Jane Jacobs, jitney, John Snow's cholera map, Joi Ito, Khan Academy, Kibera, Kickstarter, knowledge worker, load shedding, M-Pesa, Mark Zuckerberg, megacity, mobile money, mutually assured destruction, new economy, New Urbanism, Norbert Wiener, Occupy movement, off grid, openstreetmap, packet switching, Panopticon Jeremy Bentham, Parag Khanna, patent troll, Pearl River Delta, place-making, planetary scale, popular electronics, RFC: Request For Comment, RFID, ride hailing / ride sharing, Robert Gordon, self-driving car, sharing economy, Silicon Valley, Skype, smart cities, smart grid, smart meter, social graph, social software, social web, special economic zone, Steve Jobs, Steve Wozniak, Stuxnet, supply-chain management, technoutopianism, Ted Kaczynski, telepresence, The Death and Life of Great American Cities, too big to fail, trade route, Tyler Cowen: Great Stagnation, undersea cable, Upton Sinclair, uranium enrichment, urban decay, urban planning, urban renewal, Vannevar Bush, working poor, working-age population, X Prize, Y2K, zero day, Zipcar

The first layer is “instrumentation”—the sensor grids embedded in infrastructure that measure conditions throughout the city, much as companies use GPS trackers, bar codes, and cash-register receipts to measure what is going on in their businesses. This raw data is fed into “urban informatics” systems that combine data-crunching hardware and software to process the signals into usable intelligence and let us visualize and discover patterns that can help us make better decisions. Finally, an “urban information architecture” provides a set of management practices and business processes to tell people how to use the results of these computations to get their work done and cut through red tape and bureaucratic barriers. As the company argued in a 2010 white paper, “the smart city is so different in essence to the 20th century city that the governance models and organisational frameworks themselves must evolve.”33 Together, these three layers will allow us to rewire governments by design, transforming the way they work internally and together with outside partners and citizens.

As the company argued in a 2010 white paper, “the smart city is so different in essence to the 20th century city that the governance models and organisational frameworks themselves must evolve.”33 Together, these three layers will allow us to rewire governments by design, transforming the way they work internally and together with outside partners and citizens. To understand how all of this might help cities, look at the effect of technology on air transportation over the last few decades. For customers, interactions with airlines often have a Kafkaesque tenor of confusion and disdain. But behind the scenes, an arsenal of sensors, informatics, and information-driven business processes are at work, coordinating the movements of millions of passengers, crew, baggage, and planes. It was estimated in the late 1990s that “50,000 electronic exchanges of all sorts” were required to get a single Boeing 747 off the ground, from booking seats to ordering food and fuel.34 In today’s highly instrumented and networked air transport network, millions of digital transactions orchestrate each flight.

For the company formed from that merger, the prosaically named Computing-Tabulating-Recording Company, would pursue an ever-expanding market for information processing throughout the next century. In 1924, under the leadership of Thomas J. Watson, it would take a new name—International Business Machines Corporation. Big Blue Fast-forward to 2011, a big year for the company that came to be known as “Big Blue.” It’s the one-hundredth anniversary of the merger that launched Hollerith’s punch-card enterprise on its way to global domination and built a big business processing the big data of government and business. Throughout the twentieth century, IBM’s pinstripe-suited engineers personified corporate America. But in 1993, after a long decline driven by growing competition in its mainframe and personal computer businesses, Big Blue hit rock bottom, posting an $8.1 billion operating loss. That year CEO Louis Gerstner Jr., a veteran of RJR Nabisco and American Express, embarked on a radical transformation plan.


pages: 494 words: 142,285

The Future of Ideas: The Fate of the Commons in a Connected World by Lawrence Lessig

AltaVista, Andy Kessler, barriers to entry, business process, Cass Sunstein, commoditize, computer age, creative destruction, dark matter, disintermediation, disruptive innovation, Donald Davies, Erik Brynjolfsson, George Gilder, Hacker Ethic, Hedy Lamarr / George Antheil, Howard Rheingold, Hush-A-Phone, HyperCard, hypertext link, Innovator's Dilemma, invention of hypertext, inventory management, invisible hand, Jean Tirole, Jeff Bezos, Joseph Schumpeter, Kenneth Arrow, Larry Wall, Leonard Kleinrock, linked data, Marc Andreessen, Menlo Park, Mitch Kapor, Network effects, new economy, packet switching, peer-to-peer, peer-to-peer model, price mechanism, profit maximization, RAND corporation, rent control, rent-seeking, RFC: Request For Comment, Richard Stallman, Richard Thaler, Robert Bork, Ronald Coase, Search for Extraterrestrial Intelligence, SETI@home, Silicon Valley, smart grid, software patent, spectrum auction, Steve Crocker, Steven Levy, Stewart Brand, Ted Nelson, Telecommunications Act of 1996, The Chicago School, transaction costs, zero-sum game

Over time, the push was for even broader patent protection—this time to cover business processes as well as software inventions. A software-implemented business process patent is a patent for a process of doing business, sufficiently novel and nonobvious to earn the U.S. Patent and Trademark Office's favor.85 Most thought such processes beyond the reach of patent law. This was not because patent law never covered processes—it plainly did. But the expectation was that it would not cover business processes because adequate return from the process itself would create a sufficient incentive to invent. 86 In 1998, however, the United States Court of Appeals for the Federal Circuit put this idea to rest. The patent law reached business processes just as any other, and patents for business methods were, the court held, not invalid because of the subject matter.87 The case in which this issue arose was one where a financial services company had developed a new kind of mutual fund service, one that would manage a pool of mutual funds through a software-based technology.


Mastering Prezi for Business Presentations by Russell Anderson-Williams

business process, call centre, market design, Skype

You might design a Prezi and deliver a presentation to colleagues yourself, but you could reinforce the message by using the same Prezi file and adding narration, then sending out the link for everyone to view it. [ 41 ] Using Audio Or you might have a business critical process that needs explaining quickly to colleagues around the world. Create a Prezi with narration, share it online and save yourself the airfares! Using this technique you could start to build an entire library of business processes, inductions, and training that your colleagues are able to explore in their own time. Creating an environment When new members of staff join your business they normally spend a few days in a classroom environment having training. There's a projector and a whiteboard, and for the most part they engage in good conversations with the trainer and each other and learn a lot. But then when they hit the retail shop floor or the sales floor of your busy call center they feel slightly overwhelmed.

This is the case for all of the diagrams and drawings available from the menu. [ 184 ] Chapter 9 Using these diagrams and drawings gives you a great chance to explain concepts and ideas to your colleagues with ease. You can see from the preceding screenshot that there's a good range of useful drawings and diagrams that you're used to seeing in business presentations. You can easily create organograms, timelines for projects, or business processes and cycles, simply by using the templates available and inserting your own content and imagery. By using the Theme wizard explained earlier in this chapter, you can make sure your drawings and diagrams use your corporate colors. Prezi text editor The text editor in Prezi has had a wonderful makeover in recent months. There are now some lovely new features within it that will make your life much easier, including the number one must have feature at the very top of every Prezi user's wish list for some time.


pages: 140 words: 91,067

Money, Real Quick: The Story of M-PESA by Tonny K. Omwansa, Nicholas P. Sullivan, The Guardian

BRICs, business process, business process outsourcing, call centre, cashless society, cloud computing, creative destruction, crowdsourcing, delayed gratification, dematerialisation, disruptive innovation, financial exclusion, financial innovation, financial intermediation, income per capita, Kibera, Kickstarter, M-Pesa, microcredit, mobile money, Network effects, new economy, reserve currency, Silicon Valley, software as a service, transaction costs

The Central Bank had also engaged Consult Hyperion, an IT consultancy firm, to conduct an operational risk audit, according to a case study by the Alliance for Financial Inclusion, an international group of Central Bankers and financial regulators. Consult Hyperion tested the end-to-end encryption of the SIM card functionality, which held all of the confidential customer data; reviewed the use of hardware security modules at the M-PESA servers; and ensured that all business processes had embedded security procedures, including live backup. The consultants also checked to ensure that all of the M-PESA systems allowed for comprehensive reporting and management so every transaction could be monitored, individually and en masse. Because Safaricom was not a bank, it was not technically under the jurisdiction of the Central Bank. However, the Banking Act did give the Bank the general authority to formulate and implement such “policies as best promote the establishment, regulation and supervision of efficient and effective payment, clearing and settlement systems.”

It started with electronics shops selling and repairing phones, morphed into software developers working on their own to develop apps to build a better platform, and now has the full support of the Kenyan government as it looks to foster IT as a pillar for future economic growth. The government, with support from the International Finance Corporation (IFC) of the World Bank, is constructing a sprawling 5,000-acre technology park (Malili Technology Park) to promote BPO (business process outsourcing) as well as content and app development. “The ICT revolution is starting to connect to other sectors and starting to influence the old economy and causing an enormous amount of growth,” says Wolfgang Fengler, lead economist at the Nairobi office of the World Bank. A key focal point for new startups is iHub (“innovation” Hub) in Nairobi, co-founded by Eric Hersman, also the co-founder of Ushahidi.


pages: 290 words: 98,699

Wealth Without a Job: The Entrepreneur's Guide to Freedom and Security Beyond the 9 to 5 Lifestyle by Phil Laut, Andy Fuehl

British Empire, business process, buy and hold, declining real wages, fear of failure, hiring and firing, index card, job satisfaction, Menlo Park, Silicon Valley, women in the workforce

Thus I took the same item and moved it step-by-step to the more difficult area of the diagram, as my sales ability increased. It is not just the emotional intensity that changes as you move toward the upper right-hand corner of the diagram. The sales cycle takes longer and the whole thing becomes more complex because there are more steps. Sometimes several people must agree before you can make the sale. The $5 to $20 item is business at its simplest. It compresses the four basic business processes described in Chapter 9 into one simple operation. Moving to something bigger produces greater emotional intensity and a longer sales cycle. Learning to Receive Learning to receive? Yes, that’s right, even though most people have never heard those words in the same sentence. Typically, receiving is viewed as a fortuitous, unintentional accident rather than as a skill. Receiving does have a peculiar characteristic that differentiates it from most skills: It is awkward to get practice in receiving.

It is hard for people to make significant accomplishments unless they resolve internal conflicts that hold them back. Any sort of personal growth activity that aids you directly in the resolution of internal conflicts and childhood conditioning is certain to facilitate your accomplishment of any significant project. Sample Plan Here is the beginning of a sample plan someone wrote to expand a proofreading and editing business. This plan is modeled to include the four distinct business processes from Chapter 10: 1. Finding prospective customers 2. Presenting your product or service, so prospects buy ccc_laut_ch14_249-262.qxd 7/8/04 12:28 PM Page 257 Sample Plan 3. Producing your product or service, delivering it and collecting payment 4. Follow-up Date Jun 12 Purpose Jun 14 Prospecting Jun 14 Closing Jun 15 Prospecting Jun 15 Prospecting Jun 17 Prospecting Jun 17 Personal ???

See also Power affirmations Ah-ha moments, 62 Analytical mind, 135–137 Anger, 112, 121, 124–126 Answering machines, 229 Anxiety, sources of, 6, 56, 94, 119, 211 Associated position, in perception, 109–110, 155, 194–195 Attorney, functions of, 190–191 Auditory representational system, 201, 203, 206–207, 224, 232, 235, 240, 263–264 Authority figures: Authority Size method, 103–104 perceptions of, 101–103, 171 Authority Size method, 103–104 Awareness, importance of, 62–63, 111, 260 Bad habits, 17 Baseball Diamond method, 50–52, 95, 132, 199, 224, 259 Behavioral flexibility, 41 Belief system, 72 Belligerence, 160 Birth experience analogy, 113–114 Birth without Violence (Leboyer), 113 Blame, 31–35, 77–78 Bonds, in family dynamics, 80–82 Boundaries, in family dynamics, 81–82 Burnout, 16 Business model: business process, 180–181 hiring strategies, 181–182 network marketing, 182–183 prospective customers, 180 top-down view, 179–180 Business opportunities, recognition of, 143–144 Buy and hold strategy, 23, 26 Career, Power Affirmations method, 176 Career development, 16–17 Cause and effect, 31–33, 121 Certainty, 68 Change, benefits of, 12. See also Change dynamics Change dynamics: addictions, 59 cause and effect, 31–33, 121 control factor, 52–53 creativity, 34–35 excellence, physiology and psychology of, 42–44, 57 internal sensory representations, 54–57, 113, 154 massive action, 45–46 mastery, 38–40 motivation, 46–52 273 ccc_laut_ind_273-278.qxd 7/8/04 12:28 PM Page 274 274 Index Change dynamics (continued) optimal learning state, 36–38 perceptions, 56–59 productive strategy, 34–36 responsibility, 33–34 state of being, 53–54 success factors, 40–42 Charitable contributions, 3.


pages: 487 words: 151,810

The Social Animal: The Hidden Sources of Love, Character, and Achievement by David Brooks

Albert Einstein, asset allocation, assortative mating, Atul Gawande, Bernie Madoff, business process, Cass Sunstein, choice architecture, clean water, creative destruction, Daniel Kahneman / Amos Tversky, David Brooks, delayed gratification, deliberate practice, disintermediation, Donald Trump, Douglas Hofstadter, Emanuel Derman, en.wikipedia.org, fear of failure, financial deregulation, financial independence, Flynn Effect, George Akerlof, Henri Poincaré, hiring and firing, impulse control, invisible hand, Joseph Schumpeter, labor-force participation, longitudinal study, loss aversion, medical residency, meta analysis, meta-analysis, Monroe Doctrine, Paul Samuelson, Richard Thaler, risk tolerance, Robert Shiller, Robert Shiller, school vouchers, six sigma, social intelligence, Stanford marshmallow experiment, Steve Jobs, Steven Pinker, the scientific method, The Spirit Level, The Wealth of Nations by Adam Smith, Thorstein Veblen, transaction costs, Walter Mischel, young professional

Some did Dynamic Systems Theory, some did Six Sigma Analysis, or the Taguchi Method or Su-Field Analysis (structural-substance field analysis). There was TRIZ, a Russian-made model-based technology for producing creativity. There was Business Process Reengineering. Erica looked this one up on Wikipedia. According to one of the management books quoted on the site, BPR “escalates the efforts of JIT [Just In Time] and TQM [Total Quality Management] to make process orientation a strategic tool and a core competence of the organization. BPR concentrates on core business processes, and uses specific techniques within the JIT and TQM ‘toolboxes’ as enablers, while broadening the process vision.” Erica read sentences like that, or heard them at meetings, and she just had no clue how they applied to the problems at hand.

Dubner, “This Is Your Brain on Prosperity,” New York Times, January 9, 2009, http://freakonomics.blogs.nytimes.com/2009/01/09/this-is-your-brain-on-prosperity-andrew-lo-on-fear-greed-and-crisis-management/. 13 Daniel Gilbert of Harvard Gilbert, 180. 14 incompetent people exaggerate Erica Goode, “Among the Inept, Researchers Discover, Ignorance Is Bliss,” New York Times, January 18, 2000, http://www.nytimes.com/2000/01/18/health/among-the-inept-researchers-discover-ignorance-is-bliss.html. 15 the more sectors they entered Jerry Z. Muller, “Our Epistemological Depression,” The American, February 29, 2009, http://www.american.com/archive/2009/february-2009/our-epistemological-depression. 16 BPR “escalates the efforts” “Business Processing Reengineering,” Wikipedia, http://en.wikipedia.org/wiki/Business_process_reengineering. 17 John Maynard Keynes John Maynard Keyes, The General Theory of Employment, Interest and Money (New York: Classic Books America, 2009), 331. 18 “If the better elements” Plato, Phaedrus, trans. Alexander Nehamas and Paul Woodruff (New York: Hackett, 1995), 44. 19 In this scientific age Francis Bacon, “Preface to the Novum Organum,” in Prefaces and Prologues, vol. 34, ed.


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Future Crimes: Everything Is Connected, Everyone Is Vulnerable and What We Can Do About It by Marc Goodman

23andMe, 3D printing, active measures, additive manufacturing, Affordable Care Act / Obamacare, Airbnb, airport security, Albert Einstein, algorithmic trading, artificial general intelligence, Asilomar, Asilomar Conference on Recombinant DNA, augmented reality, autonomous vehicles, Baxter: Rethink Robotics, Bill Joy: nanobots, bitcoin, Black Swan, blockchain, borderless world, Brian Krebs, business process, butterfly effect, call centre, Charles Lindbergh, Chelsea Manning, cloud computing, cognitive dissonance, computer vision, connected car, corporate governance, crowdsourcing, cryptocurrency, data acquisition, data is the new oil, Dean Kamen, disintermediation, don't be evil, double helix, Downton Abbey, drone strike, Edward Snowden, Elon Musk, Erik Brynjolfsson, Filter Bubble, Firefox, Flash crash, future of work, game design, global pandemic, Google Chrome, Google Earth, Google Glasses, Gordon Gekko, high net worth, High speed trading, hive mind, Howard Rheingold, hypertext link, illegal immigration, impulse control, industrial robot, Intergovernmental Panel on Climate Change (IPCC), Internet of things, Jaron Lanier, Jeff Bezos, job automation, John Harrison: Longitude, John Markoff, Joi Ito, Jony Ive, Julian Assange, Kevin Kelly, Khan Academy, Kickstarter, knowledge worker, Kuwabatake Sanjuro: assassination market, Law of Accelerating Returns, Lean Startup, license plate recognition, lifelogging, litecoin, low earth orbit, M-Pesa, Mark Zuckerberg, Marshall McLuhan, Menlo Park, Metcalfe’s law, MITM: man-in-the-middle, mobile money, more computing power than Apollo, move fast and break things, move fast and break things, Nate Silver, national security letter, natural language processing, obamacare, Occupy movement, Oculus Rift, off grid, offshore financial centre, optical character recognition, Parag Khanna, pattern recognition, peer-to-peer, personalized medicine, Peter H. Diamandis: Planetary Resources, Peter Thiel, pre–internet, RAND corporation, ransomware, Ray Kurzweil, refrigerator car, RFID, ride hailing / ride sharing, Rodney Brooks, Ross Ulbricht, Satoshi Nakamoto, Second Machine Age, security theater, self-driving car, shareholder value, Silicon Valley, Silicon Valley startup, Skype, smart cities, smart grid, smart meter, Snapchat, social graph, software as a service, speech recognition, stealth mode startup, Stephen Hawking, Steve Jobs, Steve Wozniak, strong AI, Stuxnet, supply-chain management, technological singularity, telepresence, telepresence robot, Tesla Model S, The Future of Employment, The Wisdom of Crowds, Tim Cook: Apple, trade route, uranium enrichment, Wall-E, Watson beat the top human players on Jeopardy!, Wave and Pay, We are Anonymous. We are Legion, web application, Westphalian system, WikiLeaks, Y Combinator, zero day

Inside, dozens of highly talented computer geeks churned out code at a frenzied pace, as engineers laid out clusters of new Ethernet cables and added racks of computer servers trying to keep up with consumer demand. In the lobby of Innovative Marketing’s growing headquarters, workers hung a colorfully backlit five-foot-square glass logo that they suspended behind a bank of receptionists, busy answering phones and greeting employees at the start of their day. Beyond the ultramodern reception area, executives were abuzz establishing business processes and putting systems in place to provide the corporate structure required to grow the firm. Soon, department after department was added, including software development, quality assurance, finance, billing, marketing, human resources, translation and software localization, research and development, production, outsourcing, and technical support. Jain and Sundin, like any proud parents, were watching their baby grow.

He sets goals and targets for his staff and oversees the distribution of criminal proceeds, especially at bonus time. The CEO is supported by a leadership team, including other C-suite executives. CHIEF FINANCIAL OFFICER The CFO keeps track of key crime syndicate metrics, including how much crimeware has been sold, how many accounts have been hacked, and what their balances are. He will use commercial business process tools, including financial reporting systems and databases to handle accounts payable (to crime contractors) and payroll for the criminal workforce. He also maintains a sophisticated network of clandestine financial contacts for purposes of money laundering, is responsible for managing front-company merchant accounts, and oversees global transactions in a variety of currencies, including online-payment service companies that eschew any “know your customer rules,” such as Liberty Reserve.

The panoply of malware tool kits and the millions of botnet zombies around the world are providing Crime, Inc. with powerful tools of domination that can be used as offensive weapons, cash-making machines, or both. Consequently, we’ve entered the Industrial Age of Crime, with malicious computer code churned out in assembly-line fashion, specifically developed and scripted to run on autopilot, toiling away day and night committing offenses while hackers earn healthy profits in their sleep. Committing Crime Automagically Though Crime, Inc. engages in constant business process improvement, it is not committing new crimes from scratch each and every time. In the age of Moore’s law, these tasks have been readily automated and can run in the background at scale without the need for significant human intervention. Crime automation allows transnational organized crime groups to gain the same efficiencies and cost savings that multinational corporations obtained by leveraging technology to carry out their core business functions.


Designing Web APIs: Building APIs That Developers Love by Brenda Jin, Saurabh Sahni, Amir Shevat

active measures, Amazon Web Services, augmented reality, blockchain, business process, continuous integration, create, read, update, delete, Google Hangouts, if you build it, they will come, Lyft, MITM: man-in-the-middle, premature optimization, pull request, Silicon Valley, Snapchat, software as a service, the market place, uber lyft, web application, WebSocket

Real-life example Now that we have described the different aspects of audience seg‐ mentation, let’s examine a concrete example of segmentation analy‐ sis. Table 8-1 shows how the developer segmentation looks for Slack. Table 8-1. Developer audience segmentation Attribute Identity Description Enterprise developer (aka IT developer, corporate engineer, internal developer). Developer proficiency Proficient at implementing business processes, but not necessarily on the Slack platform. Enterprise developers are used to SDKs and frameworks rather than using the raw APIs. Building a Developer Strategy | 149 Attribute Platform of choice Preferred development language and frameworks Common use cases Preferred means of communication Market size and geographical distribution Description Windows and Linux scripting, web developers, SharePoint or Confluence.

Botkit framework snippet controller.hears( ['hello', 'hi', 'greetings'], ['direct_mention', 'mention', 'direct_message'], function(bot,message) { bot.reply(message.'Hello!'); } ); As you can see in Example 9-1, the developer states that they are looking to hear hello, hi, or greetings by way of a mention, direct mention, or direct message, and what they reply with, in turn, is Hello! This would have been an order of magnitude more complex to code if it weren’t for the Botkit framework. With Botkit, the developer just defines the business process, and the framework takes care of all the rest. Sometimes, you don’t need an opinionated framework. If your API is simple and intuitive, you might want to reduce maintenance cost by just providing code samples or SDKs, and leave the additional complexity to your developers. You might also take into account the proficiency of your developers. Advanced developers might not need a framework in order to handle complex use cases.


pages: 207 words: 59,298

The Gig Economy: A Critical Introduction by Jamie Woodcock, Mark Graham

Airbnb, Amazon Mechanical Turk, autonomous vehicles, barriers to entry, British Empire, business process, business process outsourcing, call centre, collective bargaining, commoditize, corporate social responsibility, crowdsourcing, David Graeber, deindustrialization, disintermediation, en.wikipedia.org, full employment, future of work, gender pay gap, gig economy, global value chain, informal economy, information asymmetry, inventory management, Jaron Lanier, Jeff Bezos, job automation, knowledge economy, Lyft, mass immigration, means of production, Network effects, new economy, Panopticon Jeremy Bentham, planetary scale, precariat, rent-seeking, RFID, ride hailing / ride sharing, Ronald Reagan, self-driving car, sentiment analysis, sharing economy, Silicon Valley, Silicon Valley ideology, TaskRabbit, The Future of Employment, transaction costs, Travis Kalanick, two-sided market, Uber and Lyft, Uber for X, uber lyft, union organizing, women in the workforce, working poor, young professional

Globalization and outsourcing The final precondition that has deeply shaped the gig economy in its current form is a combination of political economy and technology: the effects of globalization and outsourcing. This is a development and intensification of the outsourcing of call centres from high-income countries to low- and middle-income countries, for example, from the UK to India (Taylor and Bain, 2005). This laid the organizational basis for wider business process outsourcing that has become today’s online outsourcing. However, globalization has not only meant the shifting of work and trade to different parts of the world, but also brought about a generalization of what Barbrook and Cameron (1996) have termed the ‘Californian Ideology’, referring to the encouragement of deregulated markets and powerful transnational corporations. While this is often linked to the rise of ‘cognitive capitalism’ (Moulier-Boutang, 2012) and the companies creating the software and platforms in Silicon Valley, it increasingly becomes a driver to open up markets in low- and middle-income countries too.

But, until recently at least, shopkeepers are still needed to sell those goods. Some jobs are thus more geographically sticky than others. Digital platforms have, however, made a lot of work less sticky. As work becomes ever more modularized, commoditized and standardized (Scott, 2001), and as markets for digital work are created, ties between service work and particular places can be severed. While the business process of outsourcing that emerged in the 1990s allowed large companies to take advantage of a ‘global reserve army’ by moving their call centres to cheap and distant labour markets, cloudwork changes the volume and granularity at which geographically non-proximate work can take place. A small business in New York can hire a freelance transcriber in Nairobi one day and New Delhi the next. No offices or factories need to be built, no local regulations are adhered to, and – in most cases – no local taxes are paid (Graham et al., 2017b; Irani, 2015).


pages: 446 words: 102,421

Network Security Through Data Analysis: Building Situational Awareness by Michael S Collins

business process, cloud computing, create, read, update, delete, Firefox, general-purpose programming language, index card, Internet Archive, inventory management, iterative process, p-value, Parkinson's law, peer-to-peer, slashdot, statistical model, zero day

It’s easy enough for someone to hide his traffic by keeping all activity in 9–5/M–F, but if the attacker doesn’t know the company gives St. Swithin’s Day off, then he’s more likely to stick out. I’ve seen this particular phenomenon show up when dealing with insiders, particularly people worried about shoulder surfing or physical surveillance. They’ll move their activity to evenings and weekends in order to make sure their neighbors don’t ask what they’re doing, and then show up fairly visibly in the traffic logs. Business processes are a common source of false positives with volume analysis. For example, I’ve seen a corporate site where there’s a sudden biweekly spike in traffic to a particular server. The server, which covered company payroll, was checked by every employee every other Friday and never visited otherwise. Phenomena that occurs weekly, biweekly, or on multiples of 30 days is likely to be associated with the business’s own processes and should be identified as such for future reference.

Passive identification requires collecting traffic to the network and progressively eliminating all address that respond or are unmonitored—at that point, the remainder should be dark. The alternative approach is to actively probe the addresses in a network and record the ones that don’t respond; those addresses should be dark. Passive collection requires gathering data over a long period. At the minimum, collect traffic for at least a week to ensure that dynamic addressing and business processes are handled. $ rwfilter --type=out --start-date=2013/05/01:00 --end-date=2013/05/08:23 \ --proto=0-255 --pass=stdout | rwset --sip-file=light.set # Now remove the lit addresses from our total inventory $ rwsettool --difference --output=dark.set initial.set light.set An alternative approach is to ping every host on the network to determine whether it is present. $ for i in `rwsetcat initial.set` do # Do a ping with a 5 second timeout and 1 attempt to each target ping -q -c 1 -t 5 ${i} | tail -2 >> pinglog.txt done pinglog.txt will contain the summary information from the ping command, which will look like this: --- 128.2.11.0 ping statistics --- 1 packets transmitted, 0 packets received, 100.0% packet loss The contents can be parsed to produce a dark map.

delisting (address removal), DNSBLs Denial of Service (DoS), Volume and Time Analysis depth-first search (DFS), Components and Connectivity dig (see domain information groper) Digital Envoy’s Digital Element, IP Intelligence: Geolocation and Demographics Dijkstra’s Algorithm, Labeling, Weight, and Paths discrete variables, Variables and Visualization disruptibility, Enhancing IDS Detection Distributed Denial of Service (DDoS) bandwidth exhaustion, DDoS and Routing Infrastructure consistency in, DDoS and Routing Infrastructure false-positive alerts, DDoS and Routing Infrastructure force multipliers, DDoS and Routing Infrastructure mitigation of, DDoS and Routing Infrastructure routing infrastructure and, DDoS and Routing Infrastructure types of attacks, DDoS, Flash Crowds, and Resource Exhaustion distributed query tools, Data Storage for Analysis: Relational Databases, Big Data, and Other Options distribution analysis common mistakes in, The Quantile-Quantile (QQ) Plot modes, Histograms normal distribution, Exploratory Data Analysis and Visualization, The Quantile-Quantile (QQ) Plot uniform distribution, The Quantile-Quantile (QQ) Plot DNS (domain name system) basics of, DNS finding ownership with whois, Using whois to Find Ownership forward querying using dig, Forward DNS Querying Using dig–Forward DNS Querying Using dig name allocation, DNS Name Structure name structure, DNS Name Structure reverse lookup, The DNS Reverse Lookup DNS Blackhole List (DNSBL), DNSBLs–DNSBLs DNS reflection, DDoS and Routing Infrastructure domain information groper (dig) display options, Forward DNS Querying Using dig forward DNS querying with, Forward DNS Querying Using dig mail exchange records and, Forward DNS Querying Using dig multiline option, Forward DNS Querying Using dig querying different servers with, Forward DNS Querying Using dig resource records and, Forward DNS Querying Using dig domains differences between, Domains: Determining Data That Can Be Collected host, Domains: Determining Data That Can Be Collected, Domains: Determining Data That Can Be Collected network, Domains: Determining Data That Can Be Collected, Domains: Determining Data That Can Be Collected service, Domains: Determining Data That Can Be Collected, Domains: Determining Data That Can Be Collected DoS (see Denial of Service) dotted quad notation, Network Layers and Addressing, Filtering Specific Types of Packets dst host predicate, Filtering Specific Types of Packets dst-reserve field, pmaps Dynamic User and Host List (DUHL), DNSBLs E echo request/reply, Checking Connectivity: Using ping to Connect to an Address EDA (see exploratory data analysis) .edu addresses, DNS Name Structure ELF (extended log format), HTTP: CLF and ELF email (see mail exchange) end-rec-num command, Choosing and Formatting Output Field Manipulation: rwcut ephemeral ports, Port Number epoch time, The Characteristics of a Good Log Message epoch-time switch, Choosing and Formatting Output Field Manipulation: rwcut error codes, The Characteristics of a Good Log Message ESP (protocol number 50), Packet and Frame Formats /etc/services file, Port Number ether dst predicate, Filtering Specific Types of Packets ether src predicate, Filtering Specific Types of Packets event construction, Actions: What a Sensor Does with Data, Classification and Event Tools: IDS, AV, and SEM Excel, An Introduction to R for Security Analysts exploitation attacks, Attack Models exploratory data analysis (EDA) bivariate description, Bivariate Description–Contingency Tables goals of, The Goal of EDA: Applying Analysis multivariate visualization, Multivariate Visualization–Multivariate Visualization operationalizing, Operationalizing Security Visualization–Rule seven: when performing long jobs, give the user some status feedback purpose of, Exploratory Data Analysis and Visualization univariate visualization, Univariate Visualization: Histograms, QQ Plots, Boxplots, and Rank Plots–Generating a Boxplot variables and, Variables and Visualization workflow, EDA Workflow extended log format (ELF), HTTP: CLF and ELF Extended Unique Identifier (EUI), MAC and Hardware Addresses F factors, Data Frames false-negative alerts, Basic Vocabulary, Classifier Failure Rates: Understanding the Base-Rate Fallacy, Enhancing IDS Detection false-positive alerts anomaly-based IDSes, Basic Vocabulary beacon detection and, Using Beaconing as an Alarm business processes, The Workday and Its Impact on Network Traffic Volume definition of, Classifier Failure Rates: Understanding the Base-Rate Fallacy detection system evaluation and, Enhancing IDS Detection inventory process and, The Goal of EDA: Applying Analysis locality-based alarms, Using Locality as an Alarm reducing, Enhancing IDS Detection volume-based alarms and, Using Volume as an Alarm with variant user-agent strings, Identifying NATs farking, DDoS and Routing Infrastructure Fibre Channel, What If It’s Not Ethernet?


pages: 461 words: 106,027

Zero to Sold: How to Start, Run, and Sell a Bootstrapped Business by Arvid Kahl

"side hustle", business process, centre right, Chuck Templeton: OpenTable:, continuous integration, coronavirus, COVID-19, Covid-19, crowdsourcing, domain-specific language, financial independence, Google Chrome, if you build it, they will come, information asymmetry, information retrieval, inventory management, Jeff Bezos, job automation, Kubernetes, minimum viable product, Network effects, performance metric, post-work, premature optimization, risk tolerance, Ruby on Rails, sentiment analysis, Silicon Valley, software as a service, source of truth, statistical model, subscription business, supply-chain management, trickle-down economics, web application

The chances are that if you are a solo founder or in a small team, tackling one specific challenge can be accomplished more realistically. Keep Your Software and Processes Simple Simplicity can only be accomplished if every part of your operation is as simple as possible: your product, your software, your infrastructure, and even how you go about your daily business. Many of the ways to make your software product simpler can also be applied to your business processes. Optimize for Hot Paths In your software, some modules or functions will be executed more often than others. If your product is an image-thumbnail-generating cloud service, the part that resizes user-uploaded files into different ready-to-be-delivered images will run all day long. If you can speed up this single process by 5%, your entire service will be 5% more efficient. When you want to start simplifying your software, look for these hot paths.

How can you make sure that you’re still aligned with the needs and requirements of your customers? Check for Problem/Solution Alignment Every few months, determine if your business is still solving the problem it set out to solve. Most products are engineered for particular use cases. Those use cases could transform over time. Industries adopt new practices, and workflows change. Your tool may be front and center right now, but a change to the business process or a regulatory requirement may make your product less effective. Talk to your customers and see if they find friction where there was none before: Do they still deal with the problem frequently? Does the product provide as much value as it used to a few months ago? Have they noticed that your product has become harder to use for certain tasks? (This usually implies a change in the task, not necessarily the product.)

While getting money and guidance is enticing, being "accelerated" wrongly will create a dynamic of dependency and misalignment that can severely inhibit your future prospects. Earnings vs. Equity Funds have been started that use Income Sharing Agreements instead of shares to create returns from investment. Earnest Capital does this, and its Shared Earnings Agreement is publicly available. Understanding that a long-term profit-sharing relationship is more compatible with the sustainable business processes of a bootstrapped business makes this kind of agreement very interesting for founders who want to keep control and benefit from external funds at the same time. Similarly, some VCs such as Indie.vc wants to support founders on their journey beyond initial profitability similarly. They take an initial percentage of ownership, which can be redeemed through a portion of the monthly revenue.


Data Mining: Concepts and Techniques: Concepts and Techniques by Jiawei Han, Micheline Kamber, Jian Pei

bioinformatics, business intelligence, business process, Claude Shannon: information theory, cloud computing, computer vision, correlation coefficient, cyber-physical system, database schema, discrete time, distributed generation, finite state, information retrieval, iterative process, knowledge worker, linked data, natural language processing, Netflix Prize, Occam's razor, pattern recognition, performance metric, phenotype, random walk, recommendation engine, RFID, semantic web, sentiment analysis, speech recognition, statistical model, stochastic process, supply-chain management, text mining, thinkpad, Thomas Bayes, web application

This is considered a good choice for data warehouse development, especially for data marts, because the turnaround time is short, modifications can be done quickly, and new designs and technologies can be adapted in a timely manner. In general, the warehouse design process consists of the following steps:1. Choose a business process to model (e.g., orders, invoices, shipments, inventory, account administration, sales, or the general ledger). If the business process is organizational and involves multiple complex object collections, a data warehouse model should be followed. However, if the process is departmental and focuses on the analysis of one kind of business process, a data mart model should be chosen. 2. Choose the business process grain, which is the fundamental, atomic level of data to be represented in the fact table for this process (e.g., individual transactions, individual daily snapshots, and so on). 3.

Bibliographic Notes Bibliography Index Front Matter Data Mining Third Edition The Morgan Kaufmann Series in Data Management Systems (Selected Titles) Joe Celko's Data, Measurements, and Standards in SQL Joe Celko Information Modeling and Relational Databases, 2nd Edition Terry Halpin, Tony Morgan Joe Celko's Thinking in Sets Joe Celko Business Metadata Bill Inmon, Bonnie O'Neil, Lowell Fryman Unleashing Web 2.0 Gottfried Vossen, Stephan Hagemann Enterprise Knowledge Management David Loshin The Practitioner's Guide to Data Quality Improvement David Loshin Business Process Change, 2nd Edition Paul Harmon IT Manager's Handbook, 2nd Edition Bill Holtsnider, Brian Jaffe Joe Celko's Puzzles and Answers, 2nd Edition Joe Celko Architecture and Patterns for IT Service Management, 2nd Edition, Resource Planning and Governance Charles Betz Joe Celko's Analytics and OLAP in SQL Joe Celko Data Preparation for Data Mining Using SAS Mamdouh Refaat Querying XML: XQuery, XPath, and SQL/ XML in Context Jim Melton, Stephen Buxton Data Mining: Concepts and Techniques, 3rd Edition Jiawei Han, Micheline Kamber, Jian Pei Database Modeling and Design: Logical Design, 5th Edition Toby J.

Forms should allow respondents to specify values such as “not applicable.” Software routines may also be used to uncover other null values (e.g., “don't know,” ”?” or “none”). Ideally, each attribute should have one or more rules regarding the null condition. The rules may specify whether or not nulls are allowed and/or how such values should be handled or transformed. Fields may also be intentionally left blank if they are to be provided in a later step of the business process. Hence, although we can try our best to clean the data after it is seized, good database and data entry procedure design should help minimize the number of missing values or errors in the first place. 3.2.2. Noisy Data “What is noise?” Noise is a random error or variance in a measured variable. In Chapter 2, we saw how some basic statistical description techniques (e.g., boxplots and scatter plots), and methods of data visualization can be used to identify outliers, which may represent noise.


pages: 207 words: 63,071

My Start-Up Life: What A by Ben Casnocha, Marc Benioff

affirmative action, Albert Einstein, barriers to entry, Bonfire of the Vanities, business process, call centre, coherent worldview, creative destruction, David Brooks, don't be evil, fear of failure, hiring and firing, index fund, informal economy, Jeff Bezos, Joan Didion, Lao Tzu, Menlo Park, Paul Graham, place-making, Ralph Waldo Emerson, Sand Hill Road, side project, Silicon Valley, social intelligence, Steve Jobs, Steven Pinker, superconnector, technology bubble, traffic fines, Year of Magical Thinking

His picture was even on the front page of the Wall Street Journal after closing a key deal! If there was any better candidate for an interim position, we couldn’t imagine who it would be. We invited Andy to our house one summer evening to talk about Comcate. We asked Andy about his prior company, which had imploded in the dot-com burst. He went on. And on. And on. He used buzzwords like “leverage,” “boil-the-ocean,” and “business processes.” We should have seen this as a warning sign—he simply hadn’t let go of his old company, for one, and two, he seemed long on platitude and short on substance. This being said, he did possess some important entrepreneurial experiences and seemed charismatic. After Andy left, we had our customary postmortem standing meeting in our dining room, since meetings are always more efficient when done standing.

All these discomforts were more than just challenges; they seemed like fundamental impediments to scaling our business. Or any business. What is your cost of sales? Do you have an efficient lead-generation system? Is each customer basically the same or is each unique? >> There are other questions companies ask themselves. For example, do we build scale or buy scale? Building scale means developing repeatable business processes (I know that sounds buzzword-ish) to grow the client base and revenue stream while preventing expenses from rising at the same rate. Most of the best companies achieve scale through organic growth, because a slow and steady march from ten clients to five hundred is often more manageable than instantly going from ten to five hundred, as is the case in a “buy” situation. When early-stage companies buy scale, they raise 152 MY START-UP LIFE Brainstorm: A Relationship-Based First Business The factor that made Comcate successful early was relationship-based selling.


pages: 187 words: 62,861

The Penguin and the Leviathan: How Cooperation Triumphs Over Self-Interest by Yochai Benkler

business process, California gold rush, citizen journalism, Daniel Kahneman / Amos Tversky, East Village, Everything should be made as simple as possible, experimental economics, experimental subject, framing effect, informal economy, invisible hand, jimmy wales, job satisfaction, Joseph Schumpeter, Kenneth Arrow, knowledge economy, laissez-faire capitalism, loss aversion, Murray Gell-Mann, Nicholas Carr, peer-to-peer, prediction markets, Richard Stallman, Scientific racism, Silicon Valley, Steven Pinker, telemarketer, Toyota Production System, twin studies, ultimatum game, Washington Consensus, zero-sum game, Zipcar

But these principles are not limited to nonmarket and nonprofit sectors. Instead, we increasingly see mixed motivational structures deployed in firms as knowledge and innovation become key and organizations must continually adapt and improve to survive. As we’ve seen, many of today’s most successful companies operating in the most competitive markets are turning away from purely reward- and monitoring-based strategies, and instead are developing new business processes that allow for greater expression of common purpose, commitment to norms, and personal autonomy. Thus they are strengthening employees’ affective commitment to the organization and its purposes. The result is that our workplace is changing: unevenly, imperfectly, but nonetheless, in some of the leading organizations, substantially and positively. Across the board we are beginning to see increased understanding that money and material rewards are not everything, and that, indeed, their relationship to motivation and effective action is much more ambiguous and complicated than two generations of economic theory has previous claimed.

Or as Justice Oliver Wendell Holmes, Jr., put it 250 years later, “If you want to know the law and nothing else, you must look at it as a bad man, who cares only for the material consequences which such knowledge enables him to predict, not as a good one, who finds his reasons for conduct, whether inside the law or outside of it, in the vaguer sanctions of conscience.” Building laws and governmental structures, business processes and technical systems aimed at Holmes’s “bad man” has always seemed less risky. At least, we reasoned, the worst won’t happen. Always aiming to constrain the bad man might be the safer option. It might even be perfectly rational. But it also makes us always miss out on what would happen if we did trust. In life, we take chances on one another. We trust, and we behave in trustworthy ways.


pages: 680 words: 157,865

Beautiful Architecture: Leading Thinkers Reveal the Hidden Beauty in Software Design by Diomidis Spinellis, Georgios Gousios

Albert Einstein, barriers to entry, business intelligence, business process, call centre, continuous integration, corporate governance, database schema, Debian, domain-specific language, don't repeat yourself, Donald Knuth, en.wikipedia.org, fault tolerance, Firefox, general-purpose programming language, iterative process, linked data, locality of reference, loose coupling, meta analysis, meta-analysis, MVC pattern, peer-to-peer, premature optimization, recommendation engine, Richard Stallman, Ruby on Rails, semantic web, smart cities, social graph, social web, SPARQL, Steve Jobs, Stewart Brand, traveling salesman, Turing complete, type inference, web application, zero-coupon bond

Like an itinerant pearl, this message accretes elements and attributes as it is handled by intermediaries and endpoints in a potentially asynchronous style. We achieve horizontal scalability by throwing ever more message handlers at a tier. We can standardize interaction styles across partner and industry boundaries and business processes that cannot be contained by a single context. It represents a decontextualized request capable of solving very difficult interaction patterns. When strict service decomposition and description alone (i.e., SOAP and WSDL) proved insufficient to solving our interaction needs, we moved up the stack and introduced new business processing and orchestration layers. A proliferation of standards and tools has thus complicated an already untenable situation. When we cross domain and organizational boundaries we run into conflicting terms, business rules, access policies, and a very real Tower of WS-Babel.

Creating the architecture for a system involves making many such difficult trade-offs. The first task of the architect, then, is to work with stakeholders to understand and prioritize quality concerns and constraints. Why not start with functional requirements? Because there are usually many possible system decompositions. For example, starting with a data model would lead to one architecture, whereas starting with a business process model might lead to a different architecture. In the extreme case, there is no decomposition, and the system is developed as a monolithic block of software. This might satisfy all functional requirements, but it probably will not satisfy quality concerns such as changeability, maintainability, or scalability. Architects often must do architecture-level refactoring of a system, for example to move from simplex to distributed deployment, or from single-threaded to multithreaded in order to meet scalability or performance requirements, or hardcoded parameters to external configuration files because parameters that were never going to change now need to be modified.

The decision of which approach to take would depend upon where the data needed to go next. Encrypted data requires access to keys, which becomes another management burden. It is just as easy to remove the sensitive data but include it in a different resolution context when it is needed. Managing single-point access control might not be a big problem for conventional Enterprise architectures. However, given the increased presence of workflows, explicitly modeled business processes, and the like, we have plenty of opportunities to consider a user of one application needing to invoke a capability or service in more than one context. If we are passing actual data between systems, the application developers become responsible for knowing about the access control issues when crossing application boundaries. If we instead pass a reference to the data, the initial application is no longer responsible, and we can keep the information-driven centralized access control working for us.


pages: 421 words: 110,406

Platform Revolution: How Networked Markets Are Transforming the Economy--And How to Make Them Work for You by Sangeet Paul Choudary, Marshall W. van Alstyne, Geoffrey G. Parker

3D printing, Affordable Care Act / Obamacare, Airbnb, Alvin Roth, Amazon Mechanical Turk, Amazon Web Services, Andrei Shleifer, Apple's 1984 Super Bowl advert, autonomous vehicles, barriers to entry, big data - Walmart - Pop Tarts, bitcoin, blockchain, business cycle, business process, buy low sell high, chief data officer, Chuck Templeton: OpenTable:, clean water, cloud computing, connected car, corporate governance, crowdsourcing, data acquisition, data is the new oil, digital map, discounted cash flows, disintermediation, Edward Glaeser, Elon Musk, en.wikipedia.org, Erik Brynjolfsson, financial innovation, Haber-Bosch Process, High speed trading, information asymmetry, Internet of things, inventory management, invisible hand, Jean Tirole, Jeff Bezos, jimmy wales, John Markoff, Khan Academy, Kickstarter, Lean Startup, Lyft, Marc Andreessen, market design, Metcalfe’s law, multi-sided market, Network effects, new economy, payday loans, peer-to-peer lending, Peter Thiel, pets.com, pre–internet, price mechanism, recommendation engine, RFID, Richard Stallman, ride hailing / ride sharing, Robert Metcalfe, Ronald Coase, Satoshi Nakamoto, self-driving car, shareholder value, sharing economy, side project, Silicon Valley, Skype, smart contracts, smart grid, Snapchat, software is eating the world, Steve Jobs, TaskRabbit, The Chicago School, the payments system, Tim Cook: Apple, transaction costs, Travis Kalanick, two-sided market, Uber and Lyft, Uber for X, uber lyft, winner-take-all economy, zero-sum game, Zipcar

THE IMPACTS OF PLATFORM DISRUPTION ON VALUE CREATION, VALUE CONSUMPTION, AND QUALITY CONTROL Platforms, then, have economic advantages that enable them to grow faster than similar pipeline businesses. This phenomenon alone would lead to significant disruption of traditional industries, as platform businesses displace pipeline businesses at the top of the Fortune 500 rankings. But the era of platforms-eat-pipelines is disrupting businesses in many other ways as well. In particular, the rise of the world of platforms is reconfiguring the familiar business processes of value creation, value consumption, and quality control.8 Reconfiguring value creation to tap new sources of supply. As self-serve systems, platforms grow and conquer markets when they minimize the barriers to usage for their users. In particular, every time a platform removes a hurdle that makes the participation of producers more difficult, value creation is reconfigured and new sources of supply are opened up.

Service platforms like Upwork bring thousands of skilled professionals under a single roof, making it easy for potential employers to evaluate, compare, and hire them. THE INCUMBENTS FIGHT BACK: PIPELINES BECOMING PLATFORMS Platform businesses, then, are disrupting the traditional business landscape in a number of ways—not only by displacing some of the world’s biggest incumbent firms, but also by transforming familiar business processes like value creation and consumer behavior as well as altering the structure of major industries. What can incumbents do to respond? Are entrenched companies that operate familiar pipeline businesses doomed to capitulate as platforms reshape and ultimately take over their industries? Not necessarily. But if incumbents hope to fight the forces of platform disruption, they’ll need to reevaluate their existing business models.

If a particular developer successfully displaces other competitors, a platform manager should be careful to ensure that the developer does not seek to displace the platform itself. There are a number of examples of such struggles for control of a particular platform’s user base. Consider SAP, the German-based multinational giant that produces software for large enterprises to use in managing their internal operations, customer relationships, and other processes. SAP, which operates a large business processes platform, has partnered with the U.S.-based firm ADP to provide payroll processing services to its users, partly in order to take advantage of ADP’s superior access to cloud computing capabilities. However, ADP has substantial customer relationships of its own and can serve as the platform host linking customers to a number of data/computing/storage partners. Thus, the partnership creates an opportunity for ADP to displace SAP as the primary manager of the customer relationship.


Super Thinking: The Big Book of Mental Models by Gabriel Weinberg, Lauren McCann

affirmative action, Affordable Care Act / Obamacare, Airbnb, Albert Einstein, anti-pattern, Anton Chekhov, autonomous vehicles, bank run, barriers to entry, Bayesian statistics, Bernie Madoff, Bernie Sanders, Black Swan, Broken windows theory, business process, butterfly effect, Cal Newport, Clayton Christensen, cognitive dissonance, commoditize, correlation does not imply causation, crowdsourcing, Daniel Kahneman / Amos Tversky, David Attenborough, delayed gratification, deliberate practice, discounted cash flows, disruptive innovation, Donald Trump, Douglas Hofstadter, Edward Lorenz: Chaos theory, Edward Snowden, effective altruism, Elon Musk, en.wikipedia.org, experimental subject, fear of failure, feminist movement, Filter Bubble, framing effect, friendly fire, fundamental attribution error, Gödel, Escher, Bach, hindsight bias, housing crisis, Ignaz Semmelweis: hand washing, illegal immigration, income inequality, information asymmetry, Isaac Newton, Jeff Bezos, John Nash: game theory, lateral thinking, loss aversion, Louis Pasteur, Lyft, mail merge, Mark Zuckerberg, meta analysis, meta-analysis, Metcalfe’s law, Milgram experiment, minimum viable product, moral hazard, mutually assured destruction, Nash equilibrium, Network effects, nuclear winter, offshore financial centre, p-value, Parkinson's law, Paul Graham, peak oil, Peter Thiel, phenotype, Pierre-Simon Laplace, placebo effect, Potemkin village, prediction markets, premature optimization, price anchoring, principal–agent problem, publication bias, recommendation engine, remote working, replication crisis, Richard Feynman, Richard Feynman: Challenger O-ring, Richard Thaler, ride hailing / ride sharing, Robert Metcalfe, Ronald Coase, Ronald Reagan, school choice, Schrödinger's Cat, selection bias, Shai Danziger, side project, Silicon Valley, Silicon Valley startup, speech recognition, statistical model, Steve Jobs, Steve Wozniak, Steven Pinker, survivorship bias, The Present Situation in Quantum Mechanics, the scientific method, The Wisdom of Crowds, Thomas Kuhn: the structure of scientific revolutions, transaction costs, uber lyft, ultimatum game, uranium enrichment, urban planning, Vilfredo Pareto, wikimedia commons

However, a heavy object gets momentum quickly once it starts moving. The faster an object goes, the more momentum it has. However, its inertia remains the same (since its mass remains the same), and it is still similarly difficult to change its velocity. To relate the concept to a real-world example, sending faxes is continually losing momentum. However, the act still has a lot of inertia since the technology is entrenched in many business processes. As a result, the momentum behind sending faxes decreases very slowly. In your life, you can take advantage of this concept by seeking out things that are rapidly gaining momentum. For example, you could join an organization that is just starting to take off or start a new organization that leverages an innovative technology or idea that is beginning to go mainstream. In Chapter 3, we discussed the benefits of focusing on high-leverage activities to make the most out of your time.

Warren Buffett popularized the term moat, making an analogy to the deep ditch of water surrounding a castle to describe how to shield yourself from the competition, thereby creating a sustainable competitive advantage. Moats are situationally dependent. The following are some cases in which they are used (not mutually exclusive): Protected intellectual property (copyright, patents, trade secrets, etc.) Specialized skills or business processes that take a long time to develop (for example, Apple’s vertically integrated products and supply chain, which meld design, hardware, and software) Exclusive access to relationships, data, or cheap materials A strong, trusted brand built over many years, which customers turn to reflexively Substantial control of a distribution channel A team of people uniquely qualified to solve a particular problem Network effects or other types of flywheels (as described in Chapter 4) A higher pace of innovation (e.g., a faster OODA loop) Elon Musk notably sparred with Warren Buffett on the concept of moats.

The Eastman Kodak Company is a great case study on how to build a moat. Founded in 1888, Kodak dominated the camera market for a hundred years. It arguably had significant moat protection in all the categories mentioned above, successfully fending off competitors and reaping outsized profits for a century: Protected intellectual property: It held many photography patents and trade secrets. Specialized skills or business processes that take a long time to develop: They had a vertically integrated supply chain serving all sides of the market, from cameras to film to printing. Exclusive access to relationships, data, or cheap materials: It had many exclusive business deals, and being the biggest in the industry, it could negotiate to secure supplies more cheaply than competitors. A strong, trusted brand built over many years: Everyone knew the name of Kodak and what it specialized in.


pages: 272 words: 64,626

Eat People: And Other Unapologetic Rules for Game-Changing Entrepreneurs by Andy Kessler

23andMe, Andy Kessler, bank run, barriers to entry, Berlin Wall, Bob Noyce, British Empire, business cycle, business process, California gold rush, carbon footprint, Cass Sunstein, cloud computing, collateralized debt obligation, collective bargaining, commoditize, computer age, creative destruction, disintermediation, Douglas Engelbart, Eugene Fama: efficient market hypothesis, fiat currency, Firefox, Fractional reserve banking, George Gilder, Gordon Gekko, greed is good, income inequality, invisible hand, James Watt: steam engine, Jeff Bezos, job automation, Joseph Schumpeter, Kickstarter, knowledge economy, knowledge worker, libertarian paternalism, low skilled workers, Mark Zuckerberg, McMansion, Netflix Prize, packet switching, personalized medicine, pets.com, prediction markets, pre–internet, profit motive, race to the bottom, Richard Thaler, risk tolerance, risk-adjusted returns, Silicon Valley, six sigma, Skype, social graph, Steve Jobs, The Wealth of Nations by Adam Smith, transcontinental railway, transfer pricing, wealth creators, Yogi Berra

They’re overworked and their compensation constantly goes down and they’re probably taking a few too many self-prescribed medications and—” “So then who?” “Well, maybe around the fifteenth it’s the financiers, the Wall Street types. But no one likes them. They call them money changers behind their backs. It’s at the twentieth that things get interesting, because then it’s the entrepreneurs who shine. Someone who’s figured out how to turn dust into gold, created some gotta-have business application or bioengineered some drug or created a business process that transforms retail—” “And so it’s their turn for the spotlight?” I ask. “You would think. But lots of people who still work for big companies or the government can’t get their arms around entrepreneurs. They got rich, too rich, so many people just assume they were lucky or had some monopoly or somehow stole the money from working stiffs who bought their stuff.” “Jealousy?” “Sure, people are jealous.

The first copy of Shrek cost $100 million, the 100 millionth copy, especially if sold online, could be priced for no more than $1, fully loaded, as it costs basically zero on the margin to sell the next digital copy. The key is to be able to charge for value rather than cost. That’s not always obvious and certainly not always easy. And like Vanderbilt with his ferry service and railroads, don’t ask, just do it. You can sort it all out later after your competitors are weakened. Like Craigslist not charging for classified listings. Just do it. Ideas and business processes are the ultimate zero marginal cost product—you have to be creative on how you sell them. Ideas are a dime a dozen and overpriced! My rule is simple. If you can do something with zero margin cost, do it. Because if you don’t do it, someone else will. Give it away and build some other business around it. Index it, package it, slice and dice it, write opinions on it, just don’t be in the business of selling it.


pages: 391 words: 71,600

Hit Refresh: The Quest to Rediscover Microsoft's Soul and Imagine a Better Future for Everyone by Satya Nadella, Greg Shaw, Jill Tracie Nichols

"Robert Solow", 3D printing, Amazon Web Services, anti-globalists, artificial general intelligence, augmented reality, autonomous vehicles, basic income, Bretton Woods, business process, cashless society, charter city, cloud computing, complexity theory, computer age, computer vision, corporate social responsibility, crowdsourcing, Deng Xiaoping, Donald Trump, Douglas Engelbart, Edward Snowden, Elon Musk, en.wikipedia.org, equal pay for equal work, everywhere but in the productivity statistics, fault tolerance, Gini coefficient, global supply chain, Google Glasses, Grace Hopper, industrial robot, Internet of things, Jeff Bezos, job automation, John Markoff, John von Neumann, knowledge worker, Mars Rover, Minecraft, Mother of all demos, NP-complete, Oculus Rift, pattern recognition, place-making, Richard Feynman, Robert Gordon, Ronald Reagan, Second Machine Age, self-driving car, side project, Silicon Valley, Skype, Snapchat, special economic zone, speech recognition, Stephen Hawking, Steve Ballmer, Steve Jobs, telepresence, telerobotics, The Rise and Fall of American Growth, Tim Cook: Apple, trade liberalization, two-sided market, universal basic income, Wall-E, Watson beat the top human players on Jeopardy!, young professional, zero-sum game

We make things that help other people make things and make things happen. That’s the essence of our mission, but our employees and our business partners, ranging from Accenture to Best Buy, Hewlett Packard to Dell, wanted to hear more. They wanted to know our business priorities. To deliver on this promise of empowerment, I said that we must galvanize all of our resources around three interconnected ambitions. First, we must reinvent productivity and business processes. We needed to evolve beyond simply building individual productivity tools and start designing an intelligent fabric for computing based on four principles—collaboration, mobility, intelligence, and trust. People still do important work as individuals, but collaboration is the new norm, so we build our tools to empower teams. We would aspire to help everyone be productive no matter where they are, regardless of the device they use.

And we want Microsoft to be their partner. To do so, there are four initiatives every company must make a priority. The first is engaging their customer base by leveraging data to improve the customer experience. Second, they must empower their own employees by enabling greater and more mobile productivity and collaboration in the new digital world of work. Third, they must optimize operations, automating and simplifying business processes across sales, operations, and finance. Fourth, they must transform their products, services, and business models. Every company is becoming a digital company, and that process begins with infusing their products with intelligence. Experts estimate between 20–50 billion “connected things” will be in use by 2020, presenting a significant opportunity for companies to drive their own digital transformation.


pages: 756 words: 120,818

The Levelling: What’s Next After Globalization by Michael O’sullivan

"Robert Solow", 3D printing, Airbnb, algorithmic trading, bank run, banking crisis, barriers to entry, Bernie Sanders, bitcoin, Black Swan, blockchain, Boris Johnson, Branko Milanovic, Bretton Woods, British Empire, business cycle, business process, capital controls, Celtic Tiger, central bank independence, cloud computing, continuation of politics by other means, corporate governance, credit crunch, cryptocurrency, deglobalization, deindustrialization, disruptive innovation, distributed ledger, Donald Trump, eurozone crisis, financial innovation, first-past-the-post, fixed income, Geoffrey West, Santa Fe Institute, Gini coefficient, global value chain, housing crisis, income inequality, Intergovernmental Panel on Climate Change (IPCC), knowledge economy, liberal world order, Long Term Capital Management, longitudinal study, market bubble, minimum wage unemployment, new economy, Northern Rock, offshore financial centre, open economy, pattern recognition, Peace of Westphalia, performance metric, private military company, quantitative easing, race to the bottom, reserve currency, Robert Gordon, Robert Shiller, Robert Shiller, Ronald Reagan, Scramble for Africa, secular stagnation, Silicon Valley, Sinatra Doctrine, South China Sea, South Sea Bubble, special drawing rights, supply-chain management, The inhabitant of London could order by telephone, sipping his morning tea in bed, the various products of the whole earth, The Rise and Fall of American Growth, The Wealth of Nations by Adam Smith, Thomas Kuhn: the structure of scientific revolutions, total factor productivity, trade liberalization, tulip mania, Valery Gerasimov, Washington Consensus

One of the central ingredients in such an approach is a country’s “intangible infrastructure,” that is, “the set of factors that develop human capability and permit the easy and efficient growth of business activity.”7 These factors can be essentially political, legal, or socioeconomic in nature. Political factors include the degree of political stability or the strength of a country’s institutional framework. The rule of law, tax policies, and the protection of intellectual and physical property rights are important legal factors. Examples of socioeconomic factors include research-and-development capabilities, business processes or employee training, and education. Stating that governments should focus more on education and should prosecute it in a clever and progressive manner is, to the ears of cynics, rehearsing the obvious. However, the reality is not so easy. Many countries get education wrong. Greece is an example. Many, if not all, of my Greek friends have had the privilege of a third-level education outside Greece, usually at universities in the south of England: the City University of London, the University of Essex, Oxford University, and the London School of Economics.

Memorably, they note, “The greatest expansions of world trade have tended to come… from the barrel of a Maxim gun, the edge of a scimitar, or the ferocity of nomadic horsemen.”5 Ominously, so have the greatest economic contractions. Echoing this, thanks to advances in technology (especially transport via boats and trains), during this early period of globalization costs fell dramatically in much the same way as communications, travel, and business process costs have been disrupted over the last twenty years. Consider a few examples: the process of surfacing roads developed by John McAdam meant that it took thirty-six hours to travel from Manchester to London in 1820, compared to five days in 1780; the expansion of canal networks across the world greatly facilitated transportation by steamer; and the opening in 1869 of the Suez Canal, over one hundred miles long, “brought Asia 4,000 miles nearer to Europe.”6 Against this backdrop, the level of world trade surged, so that by 1913 merchandise exports as a share of GDP in Western European economies reached a level of 17 percent, up from 14 percent in 1870 (subsequently falling to around 6 percent by 1938 and rebounding to above 17 percent again in the 1990s).7 Similarly, the fantastic power that capital markets seem to wield today makes it difficult to appreciate that the financial world could have been anything as developed as it is now.

In many respects intangible infrastructure is more important for a country’s future than its physical counterpart. These factors can be political, legal, or socioeconomic. Political factors include the degree of political stability or the strength of the institutional framework. Legal factors include the rule of law, tax policies, and intellectual and physical property rights protection. Examples of socioeconomic factors include research-and-development capabilities, business processes, or employee training and education. There are arguably five specific pillars of intangible infrastructure: education, health care, finance, business services, and technology.32 Though developing countries can achieve a record of high growth through physical investment (i.e., physical infrastructure), they need to cultivate intangible infrastructure in order to achieve a high and sustained level of productivity growth and human development.


pages: 482 words: 121,173

Tools and Weapons: The Promise and the Peril of the Digital Age by Brad Smith, Carol Ann Browne

Affordable Care Act / Obamacare, AI winter, airport security, Albert Einstein, augmented reality, autonomous vehicles, barriers to entry, Berlin Wall, Boeing 737 MAX, business process, call centre, Celtic Tiger, chief data officer, cloud computing, computer vision, corporate social responsibility, Donald Trump, Edward Snowden, en.wikipedia.org, immigration reform, income inequality, Internet of things, invention of movable type, invention of the telephone, Jeff Bezos, Mark Zuckerberg, minimum viable product, national security letter, natural language processing, Network effects, new economy, pattern recognition, precision agriculture, race to the bottom, ransomware, Ronald Reagan, Rubik’s Cube, school vouchers, self-driving car, Shoshana Zuboff, Silicon Valley, Skype, speech recognition, Steve Ballmer, Steve Jobs, The Rise and Fall of American Growth, Tim Cook: Apple, WikiLeaks, women in the workforce

Or don’t put asbestos in your buildings. The fundamental philosophy of a free market economy encourages business innovation, with regulation putting certain conduct off-limits but otherwise leaving companies broad freedom to experiment. One of the biggest features in the GDPR is in effect a privacy bill of rights. By giving consumers certain rights, it requires that companies not just avoid certain practices but create new business processes. For example, companies with personal information are required to enable consumers to access it. Customers have a right to know what information a company has about them. They have a right to change the information if it’s inaccurate. They have a right to delete it under a variety of circumstances. And they have a right to move their information to another provider if they prefer. In important ways, the GDPR is akin to a Magna Carta for data.

But as the internet exploded, people were inundated with privacy notices and had little time to read them. Recognizing this, Europe’s GDPR required that companies give consumers the practical ability to go online to view and control all the data that had been collected from them. It’s not surprising that its implications for technology are so sweeping. Start with the proposition that any company with millions of customers—or even thousands of customers—needs a defined business process to manage these new customer rights. Otherwise it will be swamped with inefficient and almost certainly incomplete work by employees to track down a customer’s data. But more than that, the process needs to be automated. To comply quickly and inexpensively with the GDPR, companies need to access a customer’s data in a unified way across a variety of data silos. And this requires changes to technology.

As one economic historian has noted, “Installment credit and the automobile were both cause and consequence of each other’s success.”31 This all leads to an interesting question. When New Yorkers saw the first automobile roll down the street in the nation’s financial capital, how many predicted that the invention would lead to the creation of new jobs in the financial sector? The route from the combustion engine to consumer credit was indirect and unfolded over time, bolstered in no small part by other intervening inventions and business processes such as Henry Ford’s assembly line, which made possible the mass production and thus the cheaper and broader availability of automobiles. Similarly, the automobile transformed the world of advertising. Seen by passengers traveling in a car at a speed of 30 miles per hour or more, “a sign had to be grasped instantly or it wouldn’t be grasped at all,” giving rise to the creation of corporate logos that could be recognized immediately wherever they appeared.32 Yet it’s doubtful that the early purchasers of automobiles imagined they would contribute to new jobs on Madison Avenue.


pages: 757 words: 193,541

The Practice of Cloud System Administration: DevOps and SRE Practices for Web Services, Volume 2 by Thomas A. Limoncelli, Strata R. Chalup, Christina J. Hogan

active measures, Amazon Web Services, anti-pattern, barriers to entry, business process, cloud computing, commoditize, continuous integration, correlation coefficient, database schema, Debian, defense in depth, delayed gratification, DevOps, domain-specific language, en.wikipedia.org, fault tolerance, finite state, Firefox, Google Glasses, information asymmetry, Infrastructure as a Service, intermodal, Internet of things, job automation, job satisfaction, Kickstarter, load shedding, longitudinal study, loose coupling, Malcom McLean invented shipping containers, Marc Andreessen, place-making, platform as a service, premature optimization, recommendation engine, revision control, risk tolerance, side project, Silicon Valley, software as a service, sorting algorithm, standardized shipping container, statistical model, Steven Levy, supply-chain management, Toyota Production System, web application, Yogi Berra

The application is the service, and you interact with it as you would any web site. The provider handles all the details of hardware, operating system, and platform. Some common examples include Salesforce.com, which replaces locally run sales team management software; Google Apps, which eliminates the need for locally run email and calendaring software; and Basecamp, which replaces locally run project management software. Nearly any business process that is common among many companies is offered as SaaS: human resources (HR) functions such as hiring and performance management; accounting functions such as payroll, expense tracking, and general ledgers; IT incident, request, and change management systems; and many aspects of marketing and sales management. The major selling point of SaaS is that customers do not have to concern themselves with software installation, upgrades, and operations.

Eventually the cluster maxes out, unable to do more QPS, or the system gets so slow that it cannot answer queries in the required number of milliseconds. If this maximum QPS is significantly less than the previous release, Google does not upgrade to that kernel. • User Acceptance Testing (UAT): This testing is done by customers to verify that the system meets their needs and to verify claims by the producer. Customers run their own tests to verify the new release meets their requirements. For example, they might run through each business process that involves the service. System testing involves developers making sure that they don’t ship products with defects. UAT involves customers making sure they don’t receive products with defects. Ideally, any test developed for UAT will be made known to the developers so that it can be added to their own battery of tests. This would verify such concerns earlier in the process. Sadly this is not always possible.

The computers often relied on 8-bit and later 16-bit processors, with RAM and disk storage measured in kilobytes and megabytes, not gigabytes and terabytes. CPU speed was measured in MHz, and GHz was science fiction. Data was stored on slow floppy disks. A 10MB hard drive was a luxury item, even though it was fragile and being dropped would destroy it. Scaling A company’s computer systems served internal customers, applications, and business processes. They needed to scale with the growth of the company. As the company’s business grew, so would the number of employees and the computing requirements. Even for fast-growing companies, this growth was relatively predictable and often bounded by the much slower rate at which new employees were hired. Business-critical applications ran on a small number of large, high-end computers. If a computer system ran out of capacity, it could be upgraded with additional disks, memory, and CPUs.


pages: 59 words: 15,958

Anything You Want: 40 Lessons for a New Kind of Entrepreneur by Derek Sivers

business process, Silicon Valley, Steve Jobs

Even that filled up fast. But no matter what business you’re in, it’s good to prepare for what would happen if business doubled. Have ten clients now? How would it look if you had twenty at once? Serving eighty customers for lunch each day? What would happen if 160 showed up? Notice that “more of the same” is never the answer. You’d have to do things in a new way to handle twice as much business. Processes would have to be streamlined. Never be the typical tragic small business that gets frazzled and freaked out when business is doing well. It sends a repulsive “I can’t handle this!” message to everyone. Instead, if your internal processes are always designed to handle twice your existing load, it sends an attractive “come on in, we’ve got plenty of room” message. It’s about being, not having Being a singer: Since I was fourteen, I was determined to be a great singer.


pages: 294 words: 77,356

Automating Inequality by Virginia Eubanks

autonomous vehicles, basic income, business process, call centre, cognitive dissonance, collective bargaining, correlation does not imply causation, deindustrialization, disruptive innovation, Donald Trump, Elon Musk, ending welfare as we know it, experimental subject, housing crisis, IBM and the Holocaust, income inequality, job automation, mandatory minimum, Mark Zuckerberg, mass incarceration, minimum wage unemployment, mortgage tax deduction, new economy, New Urbanism, payday loans, performance metric, Ronald Reagan, self-driving car, statistical model, strikebreaker, underbanked, universal basic income, urban renewal, War on Poverty, working poor, Works Progress Administration, young professional, zero-sum game

But justice sometimes requires an ability to bend the rules. By removing human discretion from frontline social servants and moving it instead to engineers and private contractors, the Indiana experiment supercharged discrimination. The “social specs” for the automation were based on time-worn, race- and class-motivated assumptions about welfare recipients that were encoded into performance metrics and programmed into business processes: they are lazy and must be “prodded” into contributing to their own support, they are sneaky and prone to fraudulent claims, and their burdensome use of public resources must be repeatedly discouraged. Each of these assumptions relies on, and is bolstered by, race- and class-based stereotypes. Poor Black women like Omega Young paid the price. * * * New high-tech tools allow for more precise measuring and tracking, better sharing of information, and increased visibility of targeted populations.

Surveillance and digital social sorting drive us apart as smaller and smaller microgroups are targeted for different kinds of aggression and control. When we inhabit an invisible poorhouse, we become more and more isolated, cut off from those around us, even if they share our suffering. What else is new about the digital poorhouse? The digital poorhouse is hard to understand. The software, algorithms, and models that power it are complex and often secret. Sometimes they are protected business processes, as in the case of the IBM and ACS software that denied needy Hoosiers access to cash benefits, food, and health care. Sometimes operational details of a high-tech tool are kept secret so its targets can’t game the algorithm. In Los Angeles, for example, a “Dos and Don’ts” document for workers in homeless services suggested: “Don’t give a client a copy of the VI-SPDAT. Don’t mention that people will receive a score.


pages: 493 words: 139,845

Women Leaders at Work: Untold Tales of Women Achieving Their Ambitions by Elizabeth Ghaffari

Albert Einstein, AltaVista, business cycle, business process, cloud computing, Columbine, corporate governance, corporate social responsibility, dark matter, family office, Fellow of the Royal Society, financial independence, follow your passion, glass ceiling, Grace Hopper, high net worth, knowledge worker, Long Term Capital Management, longitudinal study, performance metric, pink-collar, profit maximization, profit motive, recommendation engine, Ronald Reagan, shareholder value, Silicon Valley, Silicon Valley startup, Steve Ballmer, Steve Jobs, thinkpad, trickle-down economics, urban planning, women in the workforce, young professional

One of the things that the CIO does is not just manage data centers and the technology, but at IBM, we actually call it business transformation and information technology. That role requires working with both operations and the business to understand what the corporate strategy is and how we will implement the IT systems and the business processes supported by the IT systems. When I moved into that role, our corporate strategy was evolving quite a bit. IBM had divested itself of commodity products, such as the ThinkPads and PCs, in order to move forward. We acquired a lot more software companies. We'd bought PricewaterhouseCooper's Consulting, which took us into a whole new services business. There was a genuine need to make changes to our business processes to be able to support that new corporate strategy. So my role, first, was to help our senior executives understand our current limitations and why we needed to make a change. Then, having convinced them that we needed to do something different, they said, “Okay, that's great.

Jeanette Horan Chief Information Officer, IBM Born 1955 in Dover, England. Jeanette Horan is CIO of IBM, a position she has held since May 2011. She has been a leader at IBM since 1998, when she began taking on portfolios of responsibility at the vice president level. She was in charge of development of the Lotus brand (1998–2002), followed by strategy for the Software Group (2003–2004), and then information management (2004–2006). She became vice president of Business Process and Architecture Integration (2006–2007) and then headed Enterprise Business Transformation (through April 2011). Before coming to IBM, Ms. Horan was vice president of the Software Group and the AltaVista business unit at Digital Equipment Corporation (DEC; 1994–1998). She was also vice president of Development and Engineering at the Open Software Foundation (1989–1994). Ms. Horan has been a member of the board of directors of MicroVision in Redmond, Washington, since July 2006 and serves on the Audit and Compensation Committees.


pages: 349 words: 134,041

Traders, Guns & Money: Knowns and Unknowns in the Dazzling World of Derivatives by Satyajit Das

accounting loophole / creative accounting, Albert Einstein, Asian financial crisis, asset-backed security, beat the dealer, Black Swan, Black-Scholes formula, Bretton Woods, BRICs, Brownian motion, business process, buy and hold, buy low sell high, call centre, capital asset pricing model, collateralized debt obligation, commoditize, complexity theory, computerized trading, corporate governance, corporate raider, Credit Default Swap, credit default swaps / collateralized debt obligations, cuban missile crisis, currency peg, disintermediation, diversification, diversified portfolio, Edward Thorp, Eugene Fama: efficient market hypothesis, Everything should be made as simple as possible, financial innovation, fixed income, Haight Ashbury, high net worth, implied volatility, index arbitrage, index card, index fund, interest rate derivative, interest rate swap, Isaac Newton, job satisfaction, John Meriwether, locking in a profit, Long Term Capital Management, mandelbrot fractal, margin call, market bubble, Marshall McLuhan, mass affluent, mega-rich, merger arbitrage, Mexican peso crisis / tequila crisis, money market fund, moral hazard, mutually assured destruction, Myron Scholes, new economy, New Journalism, Nick Leeson, offshore financial centre, oil shock, Parkinson's law, placebo effect, Ponzi scheme, purchasing power parity, quantitative trading / quantitative finance, random walk, regulatory arbitrage, Right to Buy, risk-adjusted returns, risk/return, Satyajit Das, shareholder value, short selling, South Sea Bubble, statistical model, technology bubble, the medium is the message, the new new thing, time value of money, too big to fail, transaction costs, value at risk, Vanguard fund, volatility smile, yield curve, Yogi Berra, zero-coupon bond

Sticking-to-the knitting or focus Let’s get back to doing what we once did if anybody can remember what it is and how to do it. Decentralization Massive duplication, confusion and creation of thousands of petty empires. Matrix structures Everybody reports to everybody, no one knows who they work for and there is no accountability. Flat organizations Managers who can’t manage now manage tens of direct reports. Business process reorganization A process by which you cut everything that is essential, leaving only everything that you don’t need. DAS_C03.QXP 8/7/06 4:25 PM Page 73 2 N Beautiful lies – the ‘sell’ side 73 Befuddling buzzwords permeated all conversation: transformation, best-ofbreed, competitive advantage, paradigm, silos, concept, reinvention, template, benchmark, insourcing, outsourcing, off-line, online, CRM, KPI, TQM, B2B; B2C, etc.

However, the text is different. 6 ‘What Worries Warren’ (3 March 2003) Fortune. 13_INDEX.QXD 17/2/06 4:44 pm Page 325 Index accounting rules 139, 221, 228, 257 Accounting Standards Board 33 accrual accounting 139 active fund management 111 actuaries 107–10, 205, 289 Advance Corporation Tax 242 agency business 123–4, 129 agency theory 117 airline profits 140–1 Alaska 319 Allen, Woody 20 Allied Irish Bank 143 Allied Lyons 98 alternative investment strategies 112, 308 American Express 291 analysts, role of 62–4 anchor effect 136 Anderson, Rolf 92–4 annuities 204–5 ANZ Bank 277 Aquinas, Thomas 137 arbitrage 33, 38–40, 99, 114, 137–8, 171–2, 245–8, 253–5, 290, 293–6 arbitration 307 Argentina 45 arithmophobia 177 ‘armpit theory’ 303 Armstrong World Industries 274 arrears assets 225 Ashanti Goldfields 97–8, 114 Asian financial crisis (1997) 4, 9, 44–5, 115, 144, 166, 172, 207, 235, 245, 252, 310, 319 asset consultants 115–17, 281 ‘asset growth’ strategy 255 asset swaps 230–2 assets under management (AUM) 113–4, 117 assignment of loans 267–8 AT&T 275 attribution of earnings 148 auditors 144 Australia 222–4, 254–5, 261–2 back office functions 65–6 back-to-back loans 35, 40 backwardation 96 Banca Popolare di Intra 298 Bank of America 298, 303 Bank of International Settlements 50–1, 281 Bank of Japan 220 Bankers’ Trust (BT) 59, 72, 101–2, 149, 217–18, 232, 268–71, 298, 301, 319 banking regulations 155, 159, 162, 164, 281, 286, 288 banking services 34; see also commercial banks; investment banks bankruptcy 276–7 Banque Paribas 37–8, 232 Barclays Bank 121–2, 297–8 13_INDEX.QXD 17/2/06 326 4:44 pm Page 326 Index Baring, Peter 151 Baring Brothers 51, 143, 151–2, 155 ‘Basel 2’ proposal 159 basis risk 28, 42, 274 Bear Stearns 173 bearer eurodollar collateralized securities (BECS) 231–3 ‘behavioural finance’ 136 Berkshire Hathaway 19 Bermudan options 205, 227 Bernstein, Peter 167 binomial option pricing model 196 Bismarck, Otto von 108 Black, Fischer 22, 42, 160, 185, 189–90, 193, 195, 197, 209, 215 Black–Scholes formula for option pricing 22, 185, 194–5 Black–Scholes–Merton model 160, 189–93, 196–7 ‘black swan’ hypothesis 130 Blair, Tony 223 Bogle, John 116 Bohr, Niels 122 Bond, Sir John 148 ‘bond floor’ concept 251–4 bonding 75–6, 168, 181 bonuses 146–51, 244, 262, 284–5 Brady Commission 203 brand awareness and brand equity 124, 236 Brazil 302 Bretton Woods system 33 bribery 80, 303 British Sky Broadcasting (BSB) 247–8 Brittain, Alfred 72 broad index secured trust offerings (BISTROs) 284–5 brokers 69, 309 Brown, Robert 161 bubbles 210, 310, 319 Buconero 299 Buffet, Warren 12, 19–20, 50, 110–11, 136, 173, 246, 316 business process reorganization 72 business risk 159 Business Week 130 buy-backs 249 ‘call’ options 25, 90, 99, 101, 131, 190, 196 callable bonds 227–9, 256 capital asset pricing model (CAPM) 111 capital flow 30 capital guarantees 257–8 capital structure arbitrage 296 Capote, Truman 87 carbon trading 320 ‘carry cost’ model 188 ‘carry’ trades 131–3, 171 cash accounting 139 catastrophe bonds 212, 320 caveat emptor principle 27, 272 Cayman Islands 233–4 Cazenove (company) 152 CDO2 292 Cemex 249–50 chaos theory 209, 312 Chase Manhattan Bank 143, 299 Chicago Board Options Exchange 195 Chicago Board of Trade (CBOT) 25–6, 34 chief risk officers 177 China 23–5, 276, 302–4 China Club, Hong Kong 318 Chinese walls 249, 261, 280 chrematophobia 177 Citibank and Citigroup 37–8, 43, 71, 79, 94, 134–5, 149, 174, 238–9 Citron, Robert 124–5, 212–17 client relationships 58–9 Clinton, Bill 223 Coats, Craig 168–9 collateral requirements 215–16 collateralized bond obligations (CBOs) 282 collateralized debt obligations (CDOs) 45, 282–99 13_INDEX.QXD 17/2/06 4:44 pm Page 327 Index collateralized fund obligations (CFOs) 292 collateralized loan obligations (CLOs) 283–5, 288 commercial banks 265–7 commoditization 236 commodity collateralized obligations (CCOs) 292 commodity prices 304 Commonwealth Bank of Australia 255 compliance officers 65 computer systems 54, 155, 197–8 concentration risk 271, 287 conferences with clients 59 confidence levels 164 confidentiality 226 Conseco 279–80 contagion crises 291 contango 96 contingent conversion convertibles (co-cos) 257 contingent payment convertibles (co-pays) 257 Continental Illinois 34 ‘convergence’ trading 170 convertible bonds 250–60 correlations 163–6, 294–5; see also default correlations corruption 303 CORVUS 297 Cox, John 196–7 credit cycle 291 credit default swaps (CDSs) 271–84, 293, 299 credit derivatives 129, 150, 265–72, 282, 295, 299–300 Credit Derivatives Market Practices Committee 273, 275, 280–1 credit models 294, 296 credit ratings 256–7, 270, 287–8, 297–8, 304 credit reserves 140 credit risk 158, 265–74, 281–95, 299 327 credit spreads 114, 172–5, 296 Credit Suisse 70, 106, 167 credit trading 293–5 CRH Capital 309 critical events 164–6 Croesus 137 cross-ruffing 142 cubic splines 189 currency options 98, 218, 319 custom repackaged asset vehicles (CRAVEs) 233 daily earning at risk (DEAR) concept 160 Daiwa Bank 142 Daiwa Europe 277 Danish Oil and Natural Gas 296 data scrubbing 142 dealers, work of 87–8, 124–8, 133, 167, 206, 229–37, 262, 295–6; see also traders ‘death swap’ strategy 110 decentralization 72 decision-making, scientific 182 default correlations 270–1 defaults 277–9, 287, 291, 293, 296, 299 DEFCON scale 156–7 ‘Delta 1’ options 243 delta hedging 42, 200 Deming, W.E. 98, 101 Denmark 38 deregulation, financial 34 derivatives trading 5–6, 12–14, 18–72, 79, 88–9, 99–115, 123–31, 139–41, 150, 153, 155, 175, 184–9, 206–8, 211–14, 217–19, 230, 233, 257, 262–3, 307, 316, 319–20; see also equity derivatives Derman, Emmanuel 185, 198–9 Deutsche Bank 70, 104, 150, 247–8, 274, 277 devaluations 80–1, 89, 203–4, 319 13_INDEX.QXD 17/2/06 4:44 pm Page 328 328 Index dilution of share capital 241 DINKs 313 Disney Corporation 91–8 diversification 72, 110–11, 166, 299 dividend yield 243 ‘Dr Evil’ trade 135 dollar premium 35 downsizing 73 Drexel Burnham Lambert (DBL) 282 dual currency bonds 220–3; see also reverse dual currency bonds earthquakes, bonds linked to 212 efficient markets hypothesis 22, 31, 111, 203 electronic trading 126–30, 134 ‘embeddos’ 218 emerging markets 3–4, 44, 115, 132–3, 142, 212, 226, 297 Enron 54, 142, 250, 298 enterprise risk management (ERM) 176 equity capital management 249 equity collateralized obligations (ECOs) 292 equity derivatives 241–2, 246–9, 257–62 equity index 137–8 equity investment, retail market in 258–9 equity investors’ risk 286–8 equity options 253–4 equity swaps 247–8 euro currency 171, 206, 237 European Bank for Reconstruction and Development 297 European currency units 93 European Union 247–8 Exchange Rate Mechanism, European 204 exchangeable bonds 260 expatriate postings 81–2 expert witnesses 310–12 extrapolation 189, 205 extreme value theory 166 fads of management science 72–4 ‘fairway bonds’ 225 Fama, Eugene 22, 111, 194 ‘fat tail’ events 163–4 Federal Accounting Standards Board 266 Federal Home Loans Bank 213 Federal National Mortgage Association 213 Federal Reserve Bank 20, 173 Federal Reserve Board 132 ‘Ferraris’ 232 financial engineering 228, 230, 233, 249–50, 262, 269 Financial Services Authority (FSA), Japan 106, 238 Financial Services Authority (FSA), UK 15, 135 firewalls 235–6 firing of staff 84–5 First Interstate Ltd 34–5 ‘flat’ organizations 72 ‘flat’ positions 159 floaters 231–2; see also inverse floaters ‘flow’ trading 60–1, 129 Ford Motors 282, 296 forecasting 135–6, 190 forward contracts 24–33, 90, 97, 124, 131, 188 fugu fish 239 fund management 109–17, 286, 300 futures see forward contracts Galbraith, John Kenneth 121 gamma risk 200–2, 294 Gauss, Carl Friedrich 160–2 General Motors 279, 296 General Reinsurance 20 geometric Brownian motion (GBM) 161 Ghana 98 Gibson Greeting Cards 44 Glass-Steagall Act 34 gold borrowings 132 13_INDEX.QXD 17/2/06 4:44 pm Page 329 Index gold sales 97, 137 Goldman Sachs 34, 71, 93, 150, 173, 185 ‘golfing holiday bonds’ 224 Greenspan, Alan 6, 9, 19–21, 29, 43, 47, 50, 53, 62, 132, 159, 170, 215, 223, 308 Greenwich NatWest 298 Gross, Bill 19 Guangdong International Trust and Investment Corporation (GITIC) 276–7 guaranteed annuity option (GAO) contracts 204–5 Gutenfreund, John 168–9 gyosei shido 106 Haghani, Victor 168 Hamanaka, Yasuo 142 Hamburgische Landesbank 297 Hammersmith and Fulham, London Borough of 66–7 ‘hara-kiri’ swaps 39 Hartley, L.P. 163 Hawkins, Greg 168 ‘heaven and hell’ bonds 218 hedge funds 44, 88–9, 113–14, 167, 170–5, 200–2, 206, 253–4, 262–3, 282, 292, 296, 300, 308–9 hedge ratio 264 hedging 24–8, 31, 38–42, 60, 87–100, 184, 195–200, 205–7, 214, 221, 229, 252, 269, 281, 293–4, 310 Heisenberg, Werner 122 ‘hell bonds’ 218 Herman, Clement (‘Crem’) 45–9, 77, 84, 309 Herodotus 137, 178 high net worth individuals (HNWIs) 237–8, 286 Hilibrand, Lawrence 168 Hill Samuel 231–2 329 The Hitchhiker’s Guide to the Galaxy 189 Homer, Sidney 184 Hong Kong 9, 303–4 ‘hot tubbing’ 311–12 HSBC Bank 148 HSH Nordbank 297–8 Hudson, Kevin 102 Hufschmid, Hans 77–8 IBM 36, 218, 260 ICI 34 Iguchi, Toshihude 142 incubators 309 independent valuation 142 indexed currency option notes (ICONs) 218 India 302 Indonesia 5, 9, 19, 26, 55, 80–2, 105, 146, 219–20, 252, 305 initial public offerings 33, 64, 261 inside information and insider trading 133, 241, 248–9 insurance companies 107–10, 117, 119, 150, 192–3, 204–5, 221, 223, 282, 286, 300; see also reinsurance companies insurance law 272 Intel 260 intellectual property in financial products 226 Intercontinental Hotels Group (IHG) 285–6 International Accounting Standards 33 International Securities Market Association 106 International Swap Dealers Association (ISDA) 273, 275, 279, 281 Internet stock and the Internet boom 64, 112, 259, 261, 310, 319 interpolation of interest rates 141–2, 189 inverse floaters 46–51, 213–16, 225, 232–3 13_INDEX.QXD 17/2/06 4:44 pm Page 330 330 Index investment banks 34–8, 62, 64, 67, 71, 127–8, 172, 198, 206, 216–17, 234, 265–7, 298, 309 investment managers 43–4 investment styles 111–14 irrational decisions 136 Italy 106–7 Ito’s Lemma 194 Japan 39, 43, 82–3, 92, 94, 98–9, 101, 106, 132, 142, 145–6, 157, 212, 217–25, 228, 269–70 Jensen, Michael 117 Jett, Joseph 143 JP Morgan (company) 72, 150, 152, 160, 162, 249–50, 268–9, 284–5, 299; see also Morgan Guaranty junk bonds 231, 279, 282, 291, 296–7 JWM Associates 175 Kahneman, Daniel 136 Kaplanis, Costas 174 Kassouf, Sheen 253 Kaufman, Henry 62 Kerkorian, Kirk 296 Keynes, J.M. 167, 175, 198 Keynesianism 5 Kidder Peabody 143 Kleinwort Benson 40 Korea 9, 226, 278 Kozeny, Viktor 121 Krasker, William 168 Kreiger, Andy 319 Kyoto Protocol 320 Lavin, Jack 102 law of large numbers 192 Leeson, Nick 51, 131, 143, 151 legal opinions 47, 219–20, 235, 273–4 Leibowitz, Martin 184 Leland, Hayne 42, 202 Lend Lease Corporation 261–2 leptokurtic conditions 163 leverage 31–2, 48–50, 54, 99, 102–3, 114, 131–2, 171–5, 213–14, 247, 270–3, 291, 295, 305, 308 Lewis, Kenneth 303 Lewis, Michael 77–8 life insurance 204–5 Lintner, John 111 liquidity options 175 liquidity risk 158, 173 litigation 297–8 Ljunggren, Bernt 38–40 London Inter-Bank Offered Rate (LIBOR) 6, 37 ‘long first coupon’ strategy 39 Long Term Capital Management (LTCM) 44, 51, 62, 77–8, 84, 114, 166–75, 187, 206, 210, 215–18, 263–4, 309–10 Long Term Credit Bank of Japan 94 LOR (company) 202 Louisiana Purchase 319 low exercise price options (LEPOs) 261 Maastricht Treaty and criteria 106–7 McLuhan, Marshall 134 McNamara, Robert 182 macro-economic indicators, derivatives linked to 319 Mahathir Mohammed 31 Malaysia 9 management consultants 72–3 Manchester United 152 mandatory convertibles 255 Marakanond, Rerngchai 302 margin calls 97–8, 175 ‘market neutral’ investment strategy 114 market risk 158, 173, 265 marketable eurodollar collateralized securities (MECS) 232 Markowitz, Harry 110 mark-to-market accounting 10, 100, 139–41, 145, 150, 174, 215–16, 228, 244, 266, 292, 295, 298 Marx, Groucho 24, 57, 67, 117, 308 13_INDEX.QXD 17/2/06 4:44 pm Page 331 Index mathematics applied to financial instruments 209–10; see also ‘quants’ matrix structures 72 Meckling, Herbert 117 Melamed, Leo 34, 211 merchant banks 38 Meriwether, John 167–9, 172–5 Merrill Lynch 124, 150, 217, 232 Merton, Robert 22, 42, 168–70, 175, 185, 189–90, 193–7, 210 Messier, Marie 247 Metallgesellschaft 95–7 Mexico 44 mezzanine finance 285–8, 291–7 MG Refining and Marketing 95–8, 114 Microsoft 53 Mill, Stuart 130 Miller, Merton 22, 101, 194 Milliken, Michael 282 Ministry of Finance, Japan 222 misogyny 75–7 mis-selling 238, 297–8 Mitchell, Edison 70 Mitchell & Butler 275–6 models financial 42–3, 141–2, 163–4, 173–5, 181–4, 189, 198–9, 205–10 of business processes 73–5 see also credit models Modest, David 168 momentum investment 111 monetization 260–1 monopolies in financial trading 124 moral hazard 151, 280, 291 Morgan Guaranty 37–8, 221, 232 Morgan Stanley 76, 150 mortgage-backed securities (MBSs) 282–3 Moscow, City of 277 moves of staff between firms 150, 244 Mozer, Paul 169 Mullins, David 168–70 multi-skilling 73 331 Mumbai 3 Murdoch, Rupert 247 Nabisco 220 Napoleon 113 NASDAQ index 64, 112 Nash, Ogden 306 National Australia Bank 144, 178 National Rifle Association 29 NatWest Bank 144–5, 198 Niederhoffer, Victor 130 ‘Nero’ 7, 31, 45–9, 60, 77, 82–3, 88–9, 110, 118–19, 125, 128, 292 NERVA 297 New Zealand 319 Newman, Frank 104 news, financial 133–4 News Corporation 247 Newton, Isaac 162, 210 Nippon Credit Bank 106, 271 Nixon, Richard 33 Nomura Securities 218 normal distribution 160–3, 193, 199 Northern Electric 248 O’Brien, John 202 Occam, William 188 off-balance sheet transactions 32–3, 99, 234, 273, 282 ‘offsites’ 74–5 oil prices 30, 33, 89–90, 95–7 ‘omitted variable’ bias 209–10 operational risk 158, 176 opinion shopping 47 options 9, 21–2, 25–6, 32, 42, 90, 98, 124, 197, 229 pricing 185, 189–98, 202 Orange County 16, 44, 50, 124–57, 212–17, 232–3 orphan subsidiaries 234 over-the-counter (OTC) market 26, 34, 53, 95, 124, 126 overvaluation 64 13_INDEX.QXD 17/2/06 4:44 pm Page 332 332 Index ‘overwhelming force’ strategy 134–5 Owen, Martin 145 ownership, ‘legal’ and ‘economic’ 247 parallel loans 35 pari-mutuel auction system 319 Parkinson’s Law 136 Parmalat 250, 298–9 Partnoy, Frank 87 pension funds 43, 108–10, 115, 204–5, 255 People’s Bank of China (PBOC) 276–7 Peters’ Principle 71 petrodollars 71 Pétrus (restaurant) 121 Philippines, the 9 phobophobia 177 Piga, Gustavo 106 PIMCO 19 Plaza Accord 38, 94, 99, 220 plutophobia 177 pollution quotas 320 ‘portable alpha’ strategy 115 portfolio insurance 112, 202–3, 294 power reverse dual currency (PRDC) bonds 226–30 PowerPoint 75 preferred exchangeable resettable listed shares (PERLS) 255 presentations of business models 75 to clients 57, 185 prime brokerage 309 Prince, Charles 238 privatization 205 privity of contract 273 Proctor & Gamble (P&G) 44, 101–4, 155, 298, 301 product disclosure statements (PDSs) 48–9 profit smoothing 140 ‘programme’ issuers 234–5 proprietary (‘prop’) trading 60, 62, 64, 130, 174, 254 publicly available information (PAI) 277 ‘puff’ effect 148 purchasing power parity theory 92 ‘put’ options 90, 131, 256 ‘quants’ 183–9, 198, 208, 294 Raabe, Matthew 217 Ramsay, Gordon 121 range notes 225 real estate 91, 219 regulatory arbitrage 33 reinsurance companies 288–9 ‘relative value’ trading 131, 170–1, 310 Reliance Insurance 91–2 repackaging (‘repack’) business 230–6, 282, 290 replication in option pricing 195–9, 202 dynamic 200 research provided to clients 58, 62–4, 184 reserves, use of 140 reset preference shares 254–7 restructuring of loans 279–81 retail equity products 258–9 reverse convertibles 258–9 reverse dual currency bonds 223–30 ‘revolver’ loans 284–5 risk, financial, types of 158 risk adjusted return on capital (RAROC) 268, 290 risk conservation principle 229–30 risk management 65, 153–79, 184, 187, 201, 267 risk models 163–4, 173–5 riskless portfolios 196–7 RJ Reynolds (company) 220–1 rogue traders 176, 313–16 Rosenfield, Eric 168 Ross, Stephen 196–7, 202 Roth, Don 38 Rothschild, Mayer Amshel 267 Royal Bank of Scotland 298 Rubinstein, Mark 42, 196–7 13_INDEX.QXD 17/2/06 4:44 pm Page 333 Index Rumsfeld, Donald 12, 134, 306 Rusnak, John 143 Russia 45, 80, 166, 172–3, 274, 302 sales staff 55–60, 64–5, 125, 129, 217 Salomon Brothers 20, 36, 54, 62, 167–9, 174, 184 Sandor, Richard 34 Sanford, Charles 72, 269 Sanford, Eugene 269 Schieffelin, Allison 76 Scholes, Myron 22, 42, 168–71, 175, 185, 189–90, 193–7, 263–4 Seagram Group 247 Securities and Exchange Commission, US 64, 304 Securities and Futures Authority, UK 249 securitization 282–90 ‘security design’ 254–7 self-regulation 155 sex discrimination 76 share options 250–1 Sharpe, William 111 short selling 30–1, 114 Singapore 9 single-tranche CDOs 293–4, 299 ‘Sisters of Perpetual Ecstasy’ 234 SITCOMs 313 Six Continents (6C) 275–6 ‘smile’ effect 145 ‘snake’ currency system 203 ‘softing’ arrangements 117 Solon 137 Soros, George 44, 130, 253, 318–19 South Sea Bubble 210 special purpose asset repackaging companies (SPARCs) 233 special purpose vehicles (SPVs) 231–4, 282–6, 290, 293 speculation 29–31, 42, 67, 87, 108, 130 ‘spinning’ 64 333 Spitzer, Eliot 64 spread 41, 103; see also credit spreads stack hedges 96 Stamenson, Michael 124–5 standard deviation 161, 193, 195, 199 Steinberg, Sol 91 stock market booms 258, 260 stock market crashes 42–3, 168, 203, 257, 259, 319 straddles or strangles 131 strategy in banking 70 stress testing 164–6 stripping of convertible bonds 253–4 structured investment products 44, 112, 115, 118, 128, 211–39, 298 structured note asset packages (SNAPs) 233 Stuart SC 18, 307, 316–18 Styblo Bleder, Tanya 153 Suharto, Thojib 81–2 Sumitomo Corporation 100, 142 Sun Tzu 61 Svensk Exportkredit (SEK) 38–9 swaps 5–10, 26, 35–40, 107, 188, 211; see also equity swaps ‘swaptions’ 205–6 Swiss Bank Corporation (SBC) 248–9 Swiss banks 108, 305 ‘Swiss cheese theory’ 176 synthetic securitization 284–5, 288–90 systemic risk 151 Takeover Panel 248–9 Taleb, Nassim 130, 136, 167 target redemption notes 225–6 tax and tax credits 171, 242–7, 260–3 Taylor, Frederick 98, 101 team-building exercises 76 team moves 149 technical analysis 60–1, 135 television programmes about money 53, 62–3 Thailand 9, 80, 302–5 13_INDEX.QXD 17/2/06 4:44 pm Page 334 334 Index Thatcher, Margaret 205 Thorp, Edward 253 tobashi trades 105–7 Tokyo Disneyland 92, 212 top managers 72–3 total return swaps 246–8, 269 tracking error 138 traders in financial products 59–65, 129–31, 135–6, 140, 148, 151, 168, 185–6, 198; see also dealers trading limits 42, 157, 201 trading rooms 53–4, 64, 68, 75–7, 184–7, 208 Trafalgar House 248 tranching 286–9, 292, 296 transparency 26, 117, 126, 129–30, 310 Treynor, Jack 111 trust investment enhanced return securities (TIERS) 216, 233 trust obligation participating securities (TOPS) 232 TXU Europe 279 UBS Global Asset Management 110, 150, 263–4, 274 uncertainty principle 122–3 unique selling propositions 118 unit trusts 109 university education 187 unspecified fund obligations (UFOs) 292 ‘upfronting’ of income 139, 151 Valéry, Paul 163 valuation 64, 142–6 value at risk (VAR) concept 160–7, 173 value investing 111 Vanguard 116 vanity bonds 230 variance 161 Vietnam War 182, 195 Virgin Islands 233–4 Vivendi 247–8 volatility of bond prices 197 of interest rates 144–5 of share prices 161–8, 172–5, 192–3, 199 Volcker, Paul 20, 33 ‘warehouses’ 40–2, 139 warrants arbitrage 99–101 weather, bonds linked to 212, 320 Weatherstone, Dennis 72, 268 Weil, Gotscal & Manges 298 Weill, Sandy 174 Westdeutsche Genosenschafts Zentralbank 143 Westminster Group 34–5 Westpac 261–2 Wheat, Allen 70, 72, 106, 167 Wojniflower, Albert 62 World Bank 4, 36, 38 World Food Programme 320 Worldcom 250, 298 Wriston, Walter 71 WTI (West Texas Intermediate) contracts 28–30 yield curves 103, 188–9, 213, 215 yield enhancement 112, 213, 269 ‘yield hogs’ 43 zaiteku 98–101, 104–5 zero coupon bonds 221–2, 257–8

However, the text is different. 6 ‘What Worries Warren’ (3 March 2003) Fortune. 13_INDEX.QXD 17/2/06 4:44 pm Page 325 Index accounting rules 139, 221, 228, 257 Accounting Standards Board 33 accrual accounting 139 active fund management 111 actuaries 107–10, 205, 289 Advance Corporation Tax 242 agency business 123–4, 129 agency theory 117 airline profits 140–1 Alaska 319 Allen, Woody 20 Allied Irish Bank 143 Allied Lyons 98 alternative investment strategies 112, 308 American Express 291 analysts, role of 62–4 anchor effect 136 Anderson, Rolf 92–4 annuities 204–5 ANZ Bank 277 Aquinas, Thomas 137 arbitrage 33, 38–40, 99, 114, 137–8, 171–2, 245–8, 253–5, 290, 293–6 arbitration 307 Argentina 45 arithmophobia 177 ‘armpit theory’ 303 Armstrong World Industries 274 arrears assets 225 Ashanti Goldfields 97–8, 114 Asian financial crisis (1997) 4, 9, 44–5, 115, 144, 166, 172, 207, 235, 245, 252, 310, 319 asset consultants 115–17, 281 ‘asset growth’ strategy 255 asset swaps 230–2 assets under management (AUM) 113–4, 117 assignment of loans 267–8 AT&T 275 attribution of earnings 148 auditors 144 Australia 222–4, 254–5, 261–2 back office functions 65–6 back-to-back loans 35, 40 backwardation 96 Banca Popolare di Intra 298 Bank of America 298, 303 Bank of International Settlements 50–1, 281 Bank of Japan 220 Bankers’ Trust (BT) 59, 72, 101–2, 149, 217–18, 232, 268–71, 298, 301, 319 banking regulations 155, 159, 162, 164, 281, 286, 288 banking services 34; see also commercial banks; investment banks bankruptcy 276–7 Banque Paribas 37–8, 232 Barclays Bank 121–2, 297–8 13_INDEX.QXD 17/2/06 326 4:44 pm Page 326 Index Baring, Peter 151 Baring Brothers 51, 143, 151–2, 155 ‘Basel 2’ proposal 159 basis risk 28, 42, 274 Bear Stearns 173 bearer eurodollar collateralized securities (BECS) 231–3 ‘behavioural finance’ 136 Berkshire Hathaway 19 Bermudan options 205, 227 Bernstein, Peter 167 binomial option pricing model 196 Bismarck, Otto von 108 Black, Fischer 22, 42, 160, 185, 189–90, 193, 195, 197, 209, 215 Black–Scholes formula for option pricing 22, 185, 194–5 Black–Scholes–Merton model 160, 189–93, 196–7 ‘black swan’ hypothesis 130 Blair, Tony 223 Bogle, John 116 Bohr, Niels 122 Bond, Sir John 148 ‘bond floor’ concept 251–4 bonding 75–6, 168, 181 bonuses 146–51, 244, 262, 284–5 Brady Commission 203 brand awareness and brand equity 124, 236 Brazil 302 Bretton Woods system 33 bribery 80, 303 British Sky Broadcasting (BSB) 247–8 Brittain, Alfred 72 broad index secured trust offerings (BISTROs) 284–5 brokers 69, 309 Brown, Robert 161 bubbles 210, 310, 319 Buconero 299 Buffet, Warren 12, 19–20, 50, 110–11, 136, 173, 246, 316 business process reorganization 72 business risk 159 Business Week 130 buy-backs 249 ‘call’ options 25, 90, 99, 101, 131, 190, 196 callable bonds 227–9, 256 capital asset pricing model (CAPM) 111 capital flow 30 capital guarantees 257–8 capital structure arbitrage 296 Capote, Truman 87 carbon trading 320 ‘carry cost’ model 188 ‘carry’ trades 131–3, 171 cash accounting 139 catastrophe bonds 212, 320 caveat emptor principle 27, 272 Cayman Islands 233–4 Cazenove (company) 152 CDO2 292 Cemex 249–50 chaos theory 209, 312 Chase Manhattan Bank 143, 299 Chicago Board Options Exchange 195 Chicago Board of Trade (CBOT) 25–6, 34 chief risk officers 177 China 23–5, 276, 302–4 China Club, Hong Kong 318 Chinese walls 249, 261, 280 chrematophobia 177 Citibank and Citigroup 37–8, 43, 71, 79, 94, 134–5, 149, 174, 238–9 Citron, Robert 124–5, 212–17 client relationships 58–9 Clinton, Bill 223 Coats, Craig 168–9 collateral requirements 215–16 collateralized bond obligations (CBOs) 282 collateralized debt obligations (CDOs) 45, 282–99 13_INDEX.QXD 17/2/06 4:44 pm Page 327 Index collateralized fund obligations (CFOs) 292 collateralized loan obligations (CLOs) 283–5, 288 commercial banks 265–7 commoditization 236 commodity collateralized obligations (CCOs) 292 commodity prices 304 Commonwealth Bank of Australia 255 compliance officers 65 computer systems 54, 155, 197–8 concentration risk 271, 287 conferences with clients 59 confidence levels 164 confidentiality 226 Conseco 279–80 contagion crises 291 contango 96 contingent conversion convertibles (co-cos) 257 contingent payment convertibles (co-pays) 257 Continental Illinois 34 ‘convergence’ trading 170 convertible bonds 250–60 correlations 163–6, 294–5; see also default correlations corruption 303 CORVUS 297 Cox, John 196–7 credit cycle 291 credit default swaps (CDSs) 271–84, 293, 299 credit derivatives 129, 150, 265–72, 282, 295, 299–300 Credit Derivatives Market Practices Committee 273, 275, 280–1 credit models 294, 296 credit ratings 256–7, 270, 287–8, 297–8, 304 credit reserves 140 credit risk 158, 265–74, 281–95, 299 327 credit spreads 114, 172–5, 296 Credit Suisse 70, 106, 167 credit trading 293–5 CRH Capital 309 critical events 164–6 Croesus 137 cross-ruffing 142 cubic splines 189 currency options 98, 218, 319 custom repackaged asset vehicles (CRAVEs) 233 daily earning at risk (DEAR) concept 160 Daiwa Bank 142 Daiwa Europe 277 Danish Oil and Natural Gas 296 data scrubbing 142 dealers, work of 87–8, 124–8, 133, 167, 206, 229–37, 262, 295–6; see also traders ‘death swap’ strategy 110 decentralization 72 decision-making, scientific 182 default correlations 270–1 defaults 277–9, 287, 291, 293, 296, 299 DEFCON scale 156–7 ‘Delta 1’ options 243 delta hedging 42, 200 Deming, W.E. 98, 101 Denmark 38 deregulation, financial 34 derivatives trading 5–6, 12–14, 18–72, 79, 88–9, 99–115, 123–31, 139–41, 150, 153, 155, 175, 184–9, 206–8, 211–14, 217–19, 230, 233, 257, 262–3, 307, 316, 319–20; see also equity derivatives Derman, Emmanuel 185, 198–9 Deutsche Bank 70, 104, 150, 247–8, 274, 277 devaluations 80–1, 89, 203–4, 319 13_INDEX.QXD 17/2/06 4:44 pm Page 328 328 Index dilution of share capital 241 DINKs 313 Disney Corporation 91–8 diversification 72, 110–11, 166, 299 dividend yield 243 ‘Dr Evil’ trade 135 dollar premium 35 downsizing 73 Drexel Burnham Lambert (DBL) 282 dual currency bonds 220–3; see also reverse dual currency bonds earthquakes, bonds linked to 212 efficient markets hypothesis 22, 31, 111, 203 electronic trading 126–30, 134 ‘embeddos’ 218 emerging markets 3–4, 44, 115, 132–3, 142, 212, 226, 297 Enron 54, 142, 250, 298 enterprise risk management (ERM) 176 equity capital management 249 equity collateralized obligations (ECOs) 292 equity derivatives 241–2, 246–9, 257–62 equity index 137–8 equity investment, retail market in 258–9 equity investors’ risk 286–8 equity options 253–4 equity swaps 247–8 euro currency 171, 206, 237 European Bank for Reconstruction and Development 297 European currency units 93 European Union 247–8 Exchange Rate Mechanism, European 204 exchangeable bonds 260 expatriate postings 81–2 expert witnesses 310–12 extrapolation 189, 205 extreme value theory 166 fads of management science 72–4 ‘fairway bonds’ 225 Fama, Eugene 22, 111, 194 ‘fat tail’ events 163–4 Federal Accounting Standards Board 266 Federal Home Loans Bank 213 Federal National Mortgage Association 213 Federal Reserve Bank 20, 173 Federal Reserve Board 132 ‘Ferraris’ 232 financial engineering 228, 230, 233, 249–50, 262, 269 Financial Services Authority (FSA), Japan 106, 238 Financial Services Authority (FSA), UK 15, 135 firewalls 235–6 firing of staff 84–5 First Interstate Ltd 34–5 ‘flat’ organizations 72 ‘flat’ positions 159 floaters 231–2; see also inverse floaters ‘flow’ trading 60–1, 129 Ford Motors 282, 296 forecasting 135–6, 190 forward contracts 24–33, 90, 97, 124, 131, 188 fugu fish 239 fund management 109–17, 286, 300 futures see forward contracts Galbraith, John Kenneth 121 gamma risk 200–2, 294 Gauss, Carl Friedrich 160–2 General Motors 279, 296 General Reinsurance 20 geometric Brownian motion (GBM) 161 Ghana 98 Gibson Greeting Cards 44 Glass-Steagall Act 34 gold borrowings 132 13_INDEX.QXD 17/2/06 4:44 pm Page 329 Index gold sales 97, 137 Goldman Sachs 34, 71, 93, 150, 173, 185 ‘golfing holiday bonds’ 224 Greenspan, Alan 6, 9, 19–21, 29, 43, 47, 50, 53, 62, 132, 159, 170, 215, 223, 308 Greenwich NatWest 298 Gross, Bill 19 Guangdong International Trust and Investment Corporation (GITIC) 276–7 guaranteed annuity option (GAO) contracts 204–5 Gutenfreund, John 168–9 gyosei shido 106 Haghani, Victor 168 Hamanaka, Yasuo 142 Hamburgische Landesbank 297 Hammersmith and Fulham, London Borough of 66–7 ‘hara-kiri’ swaps 39 Hartley, L.P. 163 Hawkins, Greg 168 ‘heaven and hell’ bonds 218 hedge funds 44, 88–9, 113–14, 167, 170–5, 200–2, 206, 253–4, 262–3, 282, 292, 296, 300, 308–9 hedge ratio 264 hedging 24–8, 31, 38–42, 60, 87–100, 184, 195–200, 205–7, 214, 221, 229, 252, 269, 281, 293–4, 310 Heisenberg, Werner 122 ‘hell bonds’ 218 Herman, Clement (‘Crem’) 45–9, 77, 84, 309 Herodotus 137, 178 high net worth individuals (HNWIs) 237–8, 286 Hilibrand, Lawrence 168 Hill Samuel 231–2 329 The Hitchhiker’s Guide to the Galaxy 189 Homer, Sidney 184 Hong Kong 9, 303–4 ‘hot tubbing’ 311–12 HSBC Bank 148 HSH Nordbank 297–8 Hudson, Kevin 102 Hufschmid, Hans 77–8 IBM 36, 218, 260 ICI 34 Iguchi, Toshihude 142 incubators 309 independent valuation 142 indexed currency option notes (ICONs) 218 India 302 Indonesia 5, 9, 19, 26, 55, 80–2, 105, 146, 219–20, 252, 305 initial public offerings 33, 64, 261 inside information and insider trading 133, 241, 248–9 insurance companies 107–10, 117, 119, 150, 192–3, 204–5, 221, 223, 282, 286, 300; see also reinsurance companies insurance law 272 Intel 260 intellectual property in financial products 226 Intercontinental Hotels Group (IHG) 285–6 International Accounting Standards 33 International Securities Market Association 106 International Swap Dealers Association (ISDA) 273, 275, 279, 281 Internet stock and the Internet boom 64, 112, 259, 261, 310, 319 interpolation of interest rates 141–2, 189 inverse floaters 46–51, 213–16, 225, 232–3 13_INDEX.QXD 17/2/06 4:44 pm Page 330 330 Index investment banks 34–8, 62, 64, 67, 71, 127–8, 172, 198, 206, 216–17, 234, 265–7, 298, 309 investment managers 43–4 investment styles 111–14 irrational decisions 136 Italy 106–7 Ito’s Lemma 194 Japan 39, 43, 82–3, 92, 94, 98–9, 101, 106, 132, 142, 145–6, 157, 212, 217–25, 228, 269–70 Jensen, Michael 117 Jett, Joseph 143 JP Morgan (company) 72, 150, 152, 160, 162, 249–50, 268–9, 284–5, 299; see also Morgan Guaranty junk bonds 231, 279, 282, 291, 296–7 JWM Associates 175 Kahneman, Daniel 136 Kaplanis, Costas 174 Kassouf, Sheen 253 Kaufman, Henry 62 Kerkorian, Kirk 296 Keynes, J.M. 167, 175, 198 Keynesianism 5 Kidder Peabody 143 Kleinwort Benson 40 Korea 9, 226, 278 Kozeny, Viktor 121 Krasker, William 168 Kreiger, Andy 319 Kyoto Protocol 320 Lavin, Jack 102 law of large numbers 192 Leeson, Nick 51, 131, 143, 151 legal opinions 47, 219–20, 235, 273–4 Leibowitz, Martin 184 Leland, Hayne 42, 202 Lend Lease Corporation 261–2 leptokurtic conditions 163 leverage 31–2, 48–50, 54, 99, 102–3, 114, 131–2, 171–5, 213–14, 247, 270–3, 291, 295, 305, 308 Lewis, Kenneth 303 Lewis, Michael 77–8 life insurance 204–5 Lintner, John 111 liquidity options 175 liquidity risk 158, 173 litigation 297–8 Ljunggren, Bernt 38–40 London Inter-Bank Offered Rate (LIBOR) 6, 37 ‘long first coupon’ strategy 39 Long Term Capital Management (LTCM) 44, 51, 62, 77–8, 84, 114, 166–75, 187, 206, 210, 215–18, 263–4, 309–10 Long Term Credit Bank of Japan 94 LOR (company) 202 Louisiana Purchase 319 low exercise price options (LEPOs) 261 Maastricht Treaty and criteria 106–7 McLuhan, Marshall 134 McNamara, Robert 182 macro-economic indicators, derivatives linked to 319 Mahathir Mohammed 31 Malaysia 9 management consultants 72–3 Manchester United 152 mandatory convertibles 255 Marakanond, Rerngchai 302 margin calls 97–8, 175 ‘market neutral’ investment strategy 114 market risk 158, 173, 265 marketable eurodollar collateralized securities (MECS) 232 Markowitz, Harry 110 mark-to-market accounting 10, 100, 139–41, 145, 150, 174, 215–16, 228, 244, 266, 292, 295, 298 Marx, Groucho 24, 57, 67, 117, 308 13_INDEX.QXD 17/2/06 4:44 pm Page 331 Index mathematics applied to financial instruments 209–10; see also ‘quants’ matrix structures 72 Meckling, Herbert 117 Melamed, Leo 34, 211 merchant banks 38 Meriwether, John 167–9, 172–5 Merrill Lynch 124, 150, 217, 232 Merton, Robert 22, 42, 168–70, 175, 185, 189–90, 193–7, 210 Messier, Marie 247 Metallgesellschaft 95–7 Mexico 44 mezzanine finance 285–8, 291–7 MG Refining and Marketing 95–8, 114 Microsoft 53 Mill, Stuart 130 Miller, Merton 22, 101, 194 Milliken, Michael 282 Ministry of Finance, Japan 222 misogyny 75–7 mis-selling 238, 297–8 Mitchell, Edison 70 Mitchell & Butler 275–6 models financial 42–3, 141–2, 163–4, 173–5, 181–4, 189, 198–9, 205–10 of business processes 73–5 see also credit models Modest, David 168 momentum investment 111 monetization 260–1 monopolies in financial trading 124 moral hazard 151, 280, 291 Morgan Guaranty 37–8, 221, 232 Morgan Stanley 76, 150 mortgage-backed securities (MBSs) 282–3 Moscow, City of 277 moves of staff between firms 150, 244 Mozer, Paul 169 Mullins, David 168–70 multi-skilling 73 331 Mumbai 3 Murdoch, Rupert 247 Nabisco 220 Napoleon 113 NASDAQ index 64, 112 Nash, Ogden 306 National Australia Bank 144, 178 National Rifle Association 29 NatWest Bank 144–5, 198 Niederhoffer, Victor 130 ‘Nero’ 7, 31, 45–9, 60, 77, 82–3, 88–9, 110, 118–19, 125, 128, 292 NERVA 297 New Zealand 319 Newman, Frank 104 news, financial 133–4 News Corporation 247 Newton, Isaac 162, 210 Nippon Credit Bank 106, 271 Nixon, Richard 33 Nomura Securities 218 normal distribution 160–3, 193, 199 Northern Electric 248 O’Brien, John 202 Occam, William 188 off-balance sheet transactions 32–3, 99, 234, 273, 282 ‘offsites’ 74–5 oil prices 30, 33, 89–90, 95–7 ‘omitted variable’ bias 209–10 operational risk 158, 176 opinion shopping 47 options 9, 21–2, 25–6, 32, 42, 90, 98, 124, 197, 229 pricing 185, 189–98, 202 Orange County 16, 44, 50, 124–57, 212–17, 232–3 orphan subsidiaries 234 over-the-counter (OTC) market 26, 34, 53, 95, 124, 126 overvaluation 64 13_INDEX.QXD 17/2/06 4:44 pm Page 332 332 Index ‘overwhelming force’ strategy 134–5 Owen, Martin 145 ownership, ‘legal’ and ‘economic’ 247 parallel loans 35 pari-mutuel auction system 319 Parkinson’s Law 136 Parmalat 250, 298–9 Partnoy, Frank 87 pension funds 43, 108–10, 115, 204–5, 255 People’s Bank of China (PBOC) 276–7 Peters’ Principle 71 petrodollars 71 Pétrus (restaurant) 121 Philippines, the 9 phobophobia 177 Piga, Gustavo 106 PIMCO 19 Plaza Accord 38, 94, 99, 220 plutophobia 177 pollution quotas 320 ‘portable alpha’ strategy 115 portfolio insurance 112, 202–3, 294 power reverse dual currency (PRDC) bonds 226–30 PowerPoint 75 preferred exchangeable resettable listed shares (PERLS) 255 presentations of business models 75 to clients 57, 185 prime brokerage 309 Prince, Charles 238 privatization 205 privity of contract 273 Proctor & Gamble (P&G) 44, 101–4, 155, 298, 301 product disclosure statements (PDSs) 48–9 profit smoothing 140 ‘programme’ issuers 234–5 proprietary (‘prop’) trading 60, 62, 64, 130, 174, 254 publicly available information (PAI) 277 ‘puff’ effect 148 purchasing power parity theory 92 ‘put’ options 90, 131, 256 ‘quants’ 183–9, 198, 208, 294 Raabe, Matthew 217 Ramsay, Gordon 121 range notes 225 real estate 91, 219 regulatory arbitrage 33 reinsurance companies 288–9 ‘relative value’ trading 131, 170–1, 310 Reliance Insurance 91–2 repackaging (‘repack’) business 230–6, 282, 290 replication in option pricing 195–9, 202 dynamic 200 research provided to clients 58, 62–4, 184 reserves, use of 140 reset preference shares 254–7 restructuring of loans 279–81 retail equity products 258–9 reverse convertibles 258–9 reverse dual currency bonds 223–30 ‘revolver’ loans 284–5 risk, financial, types of 158 risk adjusted return on capital (RAROC) 268, 290 risk conservation principle 229–30 risk management 65, 153–79, 184, 187, 201, 267 risk models 163–4, 173–5 riskless portfolios 196–7 RJ Reynolds (company) 220–1 rogue traders 176, 313–16 Rosenfield, Eric 168 Ross, Stephen 196–7, 202 Roth, Don 38 Rothschild, Mayer Amshel 267 Royal Bank of Scotland 298 Rubinstein, Mark 42, 196–7 13_INDEX.QXD 17/2/06 4:44 pm Page 333 Index Rumsfeld, Donald 12, 134, 306 Rusnak, John 143 Russia 45, 80, 166, 172–3, 274, 302 sales staff 55–60, 64–5, 125, 129, 217 Salomon Brothers 20, 36, 54, 62, 167–9, 174, 184 Sandor, Richard 34 Sanford, Charles 72, 269 Sanford, Eugene 269 Schieffelin, Allison 76 Scholes, Myron 22, 42, 168–71, 175, 185, 189–90, 193–7, 263–4 Seagram Group 247 Securities and Exchange Commission, US 64, 304 Securities and Futures Authority, UK 249 securitization 282–90 ‘security design’ 254–7 self-regulation 155 sex discrimination 76 share options 250–1 Sharpe, William 111 short selling 30–1, 114 Singapore 9 single-tranche CDOs 293–4, 299 ‘Sisters of Perpetual Ecstasy’ 234 SITCOMs 313 Six Continents (6C) 275–6 ‘smile’ effect 145 ‘snake’ currency system 203 ‘softing’ arrangements 117 Solon 137 Soros, George 44, 130, 253, 318–19 South Sea Bubble 210 special purpose asset repackaging companies (SPARCs) 233 special purpose vehicles (SPVs) 231–4, 282–6, 290, 293 speculation 29–31, 42, 67, 87, 108, 130 ‘spinning’ 64 333 Spitzer, Eliot 64 spread 41, 103; see also credit spreads stack hedges 96 Stamenson, Michael 124–5 standard deviation 161, 193, 195, 199 Steinberg, Sol 91 stock market booms 258, 260 stock market crashes 42–3, 168, 203, 257, 259, 319 straddles or strangles 131 strategy in banking 70 stress testing 164–6 stripping of convertible bonds 253–4 structured investment products 44, 112, 115, 118, 128, 211–39, 298 structured note asset packages (SNAPs) 233 Stuart SC 18, 307, 316–18 Styblo Bleder, Tanya 153 Suharto, Thojib 81–2 Sumitomo Corporation 100, 142 Sun Tzu 61 Svensk Exportkredit (SEK) 38–9 swaps 5–10, 26, 35–40, 107, 188, 211; see also equity swaps ‘swaptions’ 205–6 Swiss Bank Corporation (SBC) 248–9 Swiss banks 108, 305 ‘Swiss cheese theory’ 176 synthetic securitization 284–5, 288–90 systemic risk 151 Takeover Panel 248–9 Taleb, Nassim 130, 136, 167 target redemption notes 225–6 tax and tax credits 171, 242–7, 260–3 Taylor, Frederick 98, 101 team-building exercises 76 team moves 149 technical analysis 60–1, 135 television programmes about money 53, 62–3 Thailand 9, 80, 302–5 13_INDEX.QXD 17/2/06 4:44 pm Page 334 334 Index Thatcher, Margaret 205 Thorp, Edward 253 tobashi trades 105–7 Tokyo Disneyland 92, 212 top managers 72–3 total return swaps 246–8, 269 tracking error 138 traders in financial products 59–65, 129–31, 135–6, 140, 148, 151, 168, 185–6, 198; see also dealers trading limits 42, 157, 201 trading rooms 53–4, 64, 68, 75–7, 184–7, 208 Trafalgar House 248 tranching 286–9, 292, 296 transparency 26, 117, 126, 129–30, 310 Treynor, Jack 111 trust investment enhanced return securities (TIERS) 216, 233 trust obligation participating securities (TOPS) 232 TXU Europe 279 UBS Global Asset Management 110, 150, 263–4, 274 uncertainty principle 122–3 unique selling propositions 118 unit trusts 109 university education 187 unspecified fund obligations (UFOs) 292 ‘upfronting’ of income 139, 151 Valéry, Paul 163 valuation 64, 142–6 value at risk (VAR) concept 160–7, 173 value investing 111 Vanguard 116 vanity bonds 230 variance 161 Vietnam War 182, 195 Virgin Islands 233–4 Vivendi 247–8 volatility of bond prices 197 of interest rates 144–5 of share prices 161–8, 172–5, 192–3, 199 Volcker, Paul 20, 33 ‘warehouses’ 40–2, 139 warrants arbitrage 99–101 weather, bonds linked to 212, 320 Weatherstone, Dennis 72, 268 Weil, Gotscal & Manges 298 Weill, Sandy 174 Westdeutsche Genosenschafts Zentralbank 143 Westminster Group 34–5 Westpac 261–2 Wheat, Allen 70, 72, 106, 167 Wojniflower, Albert 62 World Bank 4, 36, 38 World Food Programme 320 Worldcom 250, 298 Wriston, Walter 71 WTI (West Texas Intermediate) contracts 28–30 yield curves 103, 188–9, 213, 215 yield enhancement 112, 213, 269 ‘yield hogs’ 43 zaiteku 98–101, 104–5 zero coupon bonds 221–2, 257–8


pages: 460 words: 131,579

Masters of Management: How the Business Gurus and Their Ideas Have Changed the World—for Better and for Worse by Adrian Wooldridge

affirmative action, barriers to entry, Black Swan, blood diamonds, borderless world, business climate, business cycle, business intelligence, business process, carbon footprint, Cass Sunstein, Clayton Christensen, cloud computing, collaborative consumption, collapse of Lehman Brothers, collateralized debt obligation, commoditize, corporate governance, corporate social responsibility, creative destruction, credit crunch, crowdsourcing, David Brooks, David Ricardo: comparative advantage, disintermediation, disruptive innovation, don't be evil, Donald Trump, Edward Glaeser, Exxon Valdez, financial deregulation, Frederick Winslow Taylor, future of work, George Gilder, global supply chain, industrial cluster, intangible asset, job satisfaction, job-hopping, joint-stock company, Joseph Schumpeter, Just-in-time delivery, Kickstarter, knowledge economy, knowledge worker, lake wobegon effect, Long Term Capital Management, low skilled workers, Mark Zuckerberg, McMansion, means of production, Menlo Park, mobile money, Naomi Klein, Netflix Prize, Network effects, new economy, Nick Leeson, Norman Macrae, patent troll, Ponzi scheme, popular capitalism, post-industrial society, profit motive, purchasing power parity, Ralph Nader, recommendation engine, Richard Florida, Richard Thaler, risk tolerance, Ronald Reagan, science of happiness, shareholder value, Silicon Valley, Silicon Valley startup, Skype, Social Responsibility of Business Is to Increase Its Profits, Steve Jobs, Steven Levy, supply-chain management, technoutopianism, The Wealth of Nations by Adam Smith, Thomas Davenport, Tony Hsieh, too big to fail, wealth creators, women in the workforce, young professional, Zipcar

In August 1995, Business Week revealed that CSC Index, an ambitious young management consultancy, and two would-be gurus with close ties to the consultancy, Michael Treacy and Fred Wiersema, had been employing methods that are more often associated with the grubbier parts of the record industry to turn The Discipline of Market Leaders, a slim and rather banal volume, into a best-seller.1 They had brought so many copies of the book—always making sure to use small bookshops that were tracked by the New York Times in compiling its best-seller list—that thousands of copies had to be stored in tractor-trailers. The Business Week exposé was one of the final chapters in the most remarkable management story of the 1990s, the story of the rise, triumph, and eventual fall of business-process reengineering, or reengineering for short. Reengineering was the most successful business fad of the Clinton era—a fad that persuaded companies around the world to break themselves up into their component parts and then put themselves back together from the ground up. It was also the most ambitious: Michael Hammer, the man who invented the idea along with James Champy, liked to give his job description as “reversing the industrial revolution.”

(Taxpayers might well wonder why the company was giving money away rather than using it to repay government loans.) Ford’s philanthropic arm reduced its spending by 40 percent. Companies also embraced harsher management techniques. Bain’s annual survey of management techniques discovered that three techniques long associated with (sometimes brutal) cost-cutting crept back to the top of the management pops—benchmarking (at number one), outsourcing (at number five), and, yes, business process reengineering (at number eight).14 BP’s oil spill in the Gulf of Mexico arguably played an equally important role in CSR’s problems. BP had been a world leader of CSR. In 2000, the company that was then known as British Petroleum launched a multimillion-dollar advertising campaign to rebrand itself as the jolly green giant of the oil world, with a new motto, “Beyond Petroleum”; a new logo, a green-and-yellow sunburst; and a mountain of bumph about “corporate sustainability.”15 The company’s brand awareness jumped from 4 percent in 2000 to 67 percent in 2007, and BP was regarded as the world’s most “environmentally conscious” company.

Some gurus latched on to the rather tiresome metaphor of jazz improvisation (and, even more tiresomely, jazz musicians began to make appearances at management conferences). John Kao, a business professor and entrepreneur, argued that strategists should forget about modeling themselves on Herbert von Karajan and instead unleash their inner Charlie Parker. More importantly, an army of younger thinkers shifted attention to business processes (which could be reengineered) and “core competencies” (which needed to be cultivated). Yet, in the end, this emphasis on “process” was unsatisfactory: what is the point of tuning up your engine to perfection if you have no idea where you are headed? Even during the height of the reengineering craze, many companies continued to be committed to dreaming up “strategic visions”—grand views of the future that provided them with a general sense of mission without imposing the costs and constraints of central planning.


pages: 72 words: 21,361

Race Against the Machine: How the Digital Revolution Is Accelerating Innovation, Driving Productivity, and Irreversibly Transforming Employment and the Economy by Erik Brynjolfsson

"Robert Solow", Amazon Mechanical Turk, Any sufficiently advanced technology is indistinguishable from magic, autonomous vehicles, business cycle, business process, call centre, combinatorial explosion, corporate governance, creative destruction, crowdsourcing, David Ricardo: comparative advantage, easy for humans, difficult for computers, Erik Brynjolfsson, factory automation, first square of the chessboard, first square of the chessboard / second half of the chessboard, Frank Levy and Richard Murnane: The New Division of Labor, hiring and firing, income inequality, intangible asset, job automation, John Markoff, John Maynard Keynes: technological unemployment, Joseph Schumpeter, Khan Academy, Kickstarter, knowledge worker, Loebner Prize, low skilled workers, minimum wage unemployment, patent troll, pattern recognition, Paul Samuelson, Ray Kurzweil, rising living standards, Robert Gordon, self-driving car, shareholder value, Skype, too big to fail, Turing test, Tyler Cowen: Great Stagnation, Watson beat the top human players on Jeopardy!, wealth creators, winner-take-all economy, zero-sum game

Everyone Else The second division is between superstars and everyone else. Many industries are winner-take-all or winner-take-most competitions, in which a few individuals get the lion’s share of the rewards. Think of pop music, professional athletics, and the market for CEOs. Digital technologies increase the size and scope of these markets. These technologies replicate not only information goods but increasingly business processes as well. As a result, the talents, insights, or decisions of a single person can now dominate a national or even global market. Meanwhile good, but not great, local competitors are increasingly crowded out of their markets. The superstars in each field can now earn much larger rewards than they did in earlier decades. The effects are evident at the top of the income distribution. The top 10% of the wage distribution has done much better than the rest of the labor force, but even within this group there has been growing inequality.


pages: 93 words: 20,957

Career Essentials: The Cover Letter by Dale Mayer

business process, Kickstarter

Applied new business model to existing company to increase sales by 15% and decrease expenses by an additional 12%. Built prototypes for hydraulic jack systems for the automotive industry. Coordinated activities for 200 volunteers, speakers, accommodations, and meals. Designed and implemented a new document management system to secure the intellectual property of the company. Guided 120 employees through implementation of new business process. Headed four committees for the new hospital to establish new policies, strategies, and methodology as day–to–day operations started. Motivated employees to complete the time management guidelines put in place by new board members. Simplified accounting processes and payroll system for company and its two sister companies. Wrote documentation on company policy and procedures. Chapter 3: The Essential Pieces If you break a cover letter down to the essential parts, you’ll be able to tackle each paragraph separately.


pages: 252 words: 78,780

Lab Rats: How Silicon Valley Made Work Miserable for the Rest of Us by Dan Lyons

Airbnb, Amazon Web Services, Apple II, augmented reality, autonomous vehicles, basic income, bitcoin, blockchain, business process, call centre, Clayton Christensen, clean water, collective bargaining, corporate governance, corporate social responsibility, creative destruction, cryptocurrency, David Heinemeier Hansson, Donald Trump, Elon Musk, Ethereum, ethereum blockchain, full employment, future of work, gig economy, Gordon Gekko, greed is good, hiring and firing, housing crisis, income inequality, informal economy, Jeff Bezos, job automation, job satisfaction, job-hopping, John Gruber, Joseph Schumpeter, Kevin Kelly, knowledge worker, Lean Startup, loose coupling, Lyft, Marc Andreessen, Mark Zuckerberg, McMansion, Menlo Park, Milgram experiment, minimum viable product, Mitch Kapor, move fast and break things, move fast and break things, new economy, Panopticon Jeremy Bentham, Paul Graham, paypal mafia, Peter Thiel, plutocrats, Plutocrats, precariat, RAND corporation, remote working, RFID, ride hailing / ride sharing, Ronald Reagan, Rubik’s Cube, Ruby on Rails, Sam Altman, Sand Hill Road, self-driving car, shareholder value, Silicon Valley, Silicon Valley startup, six sigma, Skype, Social Responsibility of Business Is to Increase Its Profits, software is eating the world, Stanford prison experiment, stem cell, Steve Jobs, Steve Wozniak, Stewart Brand, TaskRabbit, telemarketer, Tesla Model S, Thomas Davenport, Tony Hsieh, Toyota Production System, traveling salesman, Travis Kalanick, tulip mania, Uber and Lyft, Uber for X, uber lyft, universal basic income, web application, Whole Earth Catalog, Y Combinator, young professional

Just like Taylor, proponents of Agile and Lean Startup believe with almost religious fervor that they can make organizations more efficient. Just like Taylor, they are probably well meaning but almost certainly dead wrong. Significantly, both Agile and Lean Startup originated in Silicon Valley, and both were invented by computer scientists. Both use the metaphor of the organization as a kind of machine, a computer that can be reprogrammed, rebooted, and updated with new businesses processes. Metaphorically speaking, the processes are the software. As with actual software, you can write a version of a program, see how it runs, then tweak it, optimize it, and keep iterating. The big drawback with the metaphor of company-as-computer is that in a computer you’re dealing with chips, which are made to be reprogrammed—but we humans are not. Oddly enough, Agile, the most popular new methodology, used at thousands of companies ranging from IBM to Barclays Bank, was not originally created as a way to run a company or manage people—it began, quite literally, as an attempt to solve a computer problem.

During the early days of the personal computer and then the dawn of the Internet, a lot of people believed the growing use of technology would be good for workers. Technology would empower us and give us more autonomy and freedom. It could democratize the workplace and give rank-and-file workers a greater voice in how the company was run. But some started to worry—including some who had invented the new ways of working. In the 1990s Babson College business professor Thomas Davenport helped create something called business process reengineering. This was a strategy for using computer technology to restructure organizations. It was supposed to be a good thing, but when corporations embraced “reengineering,” they just used it as an excuse to fire lots of people. Davenport, who was seen as the father of reengineering, was appalled. He decried the mass firings as “mindless bloodshed” carried out by managers who “treated the people inside companies as if they were just so many bits and bytes.”


pages: 304 words: 80,143

The Autonomous Revolution: Reclaiming the Future We’ve Sold to Machines by William Davidow, Michael Malone

2013 Report for America's Infrastructure - American Society of Civil Engineers - 19 March 2013, agricultural Revolution, Airbnb, American Society of Civil Engineers: Report Card, Automated Insights, autonomous vehicles, basic income, bitcoin, blockchain, blue-collar work, Bob Noyce, business process, call centre, cashless society, citizen journalism, Clayton Christensen, collaborative consumption, collaborative economy, collective bargaining, creative destruction, crowdsourcing, cryptocurrency, disintermediation, disruptive innovation, distributed ledger, en.wikipedia.org, Erik Brynjolfsson, Filter Bubble, Francis Fukuyama: the end of history, Geoffrey West, Santa Fe Institute, gig economy, Gini coefficient, Hyperloop, income inequality, industrial robot, Internet of things, invention of agriculture, invention of movable type, invention of the printing press, invisible hand, Jane Jacobs, job automation, John Maynard Keynes: Economic Possibilities for our Grandchildren, John Maynard Keynes: technological unemployment, Joseph Schumpeter, license plate recognition, Lyft, Mark Zuckerberg, mass immigration, Network effects, new economy, peer-to-peer lending, QWERTY keyboard, ransomware, Richard Florida, Robert Gordon, Ronald Reagan, Second Machine Age, self-driving car, sharing economy, Shoshana Zuboff, Silicon Valley, Simon Kuznets, Snapchat, speech recognition, Stuxnet, TaskRabbit, The Death and Life of Great American Cities, The Rise and Fall of American Growth, the scientific method, trade route, Turing test, Uber and Lyft, uber lyft, universal basic income, uranium enrichment, urban planning, zero day, zero-sum game, Zipcar

Inflation-adjusted annual earnings for production employees peaked in the 1970s and is down by 14.6 percent.7 The bottom 50 percent of U.S. taxpayers, approximately 68 million people, had an average adjusted gross income of about $14,800.8 Those incomes are supplemented by transfer payments on the order of $13,000 per household.9 Nobody knows how many autonomous workers are now on the job; all we have is guesses and estimates. But the estimates of the job losses that are to come are staggering. A recent study by Frey and Osborne looked at 702 occupations and concluded that 47 percent of American jobs might be automated in the future.10 McKinsey estimates that 85 percent of the simpler business processes can be automated. Many of those processes are in companies that provide services. Using automation, one European bank was able to originate mortgages in fifteen minutes—instead of two to ten days—cutting origination costs by 70 percent.11 A more recent study by McKinsey estimates that 400 to 800 million jobs around the world will be lost to automation by 2030.12 In 2011, W. Brian Arthur was probably the first person to describe the Autonomous Economy.

We will need to do much more than repair and update our bridges, roads, pipelines, and electrical networks. To understand why, consider that the physical infrastructure of today’s society evolved in response to basic information transfer problems. In order to efficiently exchange the information necessary to buy and sell goods, produce things of value, learn, or be entertained, people had to gather in physical places. Our existing infrastructure assets, and the business processes supporting them, can be seen as information transfer proxies. As noted earlier, consumers go to retail stores in part to find out what is available at what prices—in other words, to get information. Workers go to office buildings to gain access to files and communicate with co-workers. Walmart stores and office buildings are essentially giant file cabinets. But modern information and communications technologies increasingly remove the need for such proxies.


pages: 304 words: 82,395

Big Data: A Revolution That Will Transform How We Live, Work, and Think by Viktor Mayer-Schonberger, Kenneth Cukier

23andMe, Affordable Care Act / Obamacare, airport security, barriers to entry, Berlin Wall, big data - Walmart - Pop Tarts, Black Swan, book scanning, business intelligence, business process, call centre, cloud computing, computer age, correlation does not imply causation, dark matter, double entry bookkeeping, Eratosthenes, Erik Brynjolfsson, game design, IBM and the Holocaust, index card, informal economy, intangible asset, Internet of things, invention of the printing press, Jeff Bezos, Joi Ito, lifelogging, Louis Pasteur, Mark Zuckerberg, Menlo Park, Moneyball by Michael Lewis explains big data, Nate Silver, natural language processing, Netflix Prize, Network effects, obamacare, optical character recognition, PageRank, paypal mafia, performance metric, Peter Thiel, post-materialism, random walk, recommendation engine, self-driving car, sentiment analysis, Silicon Valley, Silicon Valley startup, smart grid, smart meter, social graph, speech recognition, Steve Jobs, Steven Levy, the scientific method, The Signal and the Noise by Nate Silver, The Wealth of Nations by Adam Smith, Thomas Davenport, Turing test, Watson beat the top human players on Jeopardy!

. [>] Brynjolfsson study—Erik Brynjolfsson, Lorin Hitt, and Heekyung Kim, “Strength in Numbers: How Does Data-Driven Decisionmaking Affect Firm Performance?” working paper, April 2011 (http://papers.ssrn.com/sol3/papers.cfm?abstract_id=1819486). [>] On Rolls-Royce—See “Rolls-Royce: Britain’s Lonely High-Flier,” The Economist, January 8, 2009 (http://www.economist.com/node/12887368). Figures updated from press office, November 2012. Erik Brynjolfsson, Andrew McAfee, Michael Sorell, and Feng Zhu, “Scale Without Mass: Business Process Replication and Industry Dynamics,” Harvard Business School working paper, September 2006 (http://www.hbs.edu/research/pdf/07-016.pdf also http://hbswk.hbs.edu/item/5532.html). [>] On the movement toward increasingly large data holders—See also Yannis Bakos and Erik Brynjolfsson, “Bundling Information Goods: Pricing, Profits, and Efficiency,” Management Science 45 (December 1999), pp. 1613–30. [>] Philip Evans—Interviews with the authors, 2011 and 2012. 8.

Research paper presented at Oxford Internet Institute’s “A Decade in Internet Time: Symposium on the Dynamics of the Internet and Society,” September 21, 2011 (http://ssrn.com/abstract=1926431). Brown, Brad, Michael Chui, and James Manyika. “Are You Ready for the Era of ‘Big Data’?” McKinsey Quarterly, October 2011, p. 10. Brynjolfsson, Erik, Andrew McAfee, Michael Sorell, and Feng Zhu. “Scale Without Mass: Business Process Replication and Industry Dynamics.” HBS working paper, September 2006 (http://www.hbs.edu/research/pdf/07-016.pdf; also http://hbswk.hbs.edu/item/5532.html). Brynjolfsson, Erik, Lorin Hitt, and Heekyung Kim. “Strength in Numbers: How Does Data-Driven Decisionmaking Affect Firm Performance?” ICIS 2011 Proceedings, Paper 13 (http://aisel.aisnet.org/icis2011/proceedings/economicvalueIS/13; also available at http://papers.ssrn.com/sol3/papers.cfm?


pages: 366 words: 94,209

Throwing Rocks at the Google Bus: How Growth Became the Enemy of Prosperity by Douglas Rushkoff

activist fund / activist shareholder / activist investor, Airbnb, algorithmic trading, Amazon Mechanical Turk, Andrew Keen, bank run, banking crisis, barriers to entry, bitcoin, blockchain, Burning Man, business process, buy and hold, buy low sell high, California gold rush, Capital in the Twenty-First Century by Thomas Piketty, carbon footprint, centralized clearinghouse, citizen journalism, clean water, cloud computing, collaborative economy, collective bargaining, colonial exploitation, Community Supported Agriculture, corporate personhood, corporate raider, creative destruction, crowdsourcing, cryptocurrency, disintermediation, diversified portfolio, Elon Musk, Erik Brynjolfsson, Ethereum, ethereum blockchain, fiat currency, Firefox, Flash crash, full employment, future of work, gig economy, Gini coefficient, global supply chain, global village, Google bus, Howard Rheingold, IBM and the Holocaust, impulse control, income inequality, index fund, iterative process, Jaron Lanier, Jeff Bezos, jimmy wales, job automation, Joseph Schumpeter, Kickstarter, loss aversion, Lyft, Marc Andreessen, Mark Zuckerberg, market bubble, market fundamentalism, Marshall McLuhan, means of production, medical bankruptcy, minimum viable product, Mitch Kapor, Naomi Klein, Network effects, new economy, Norbert Wiener, Oculus Rift, passive investing, payday loans, peer-to-peer lending, Peter Thiel, post-industrial society, profit motive, quantitative easing, race to the bottom, recommendation engine, reserve currency, RFID, Richard Stallman, ride hailing / ride sharing, Ronald Reagan, Satoshi Nakamoto, Second Machine Age, shareholder value, sharing economy, Silicon Valley, Snapchat, social graph, software patent, Steve Jobs, TaskRabbit, The Future of Employment, trade route, transportation-network company, Turing test, Uber and Lyft, Uber for X, uber lyft, unpaid internship, Y Combinator, young professional, zero-sum game, Zipcar

The transparency offered by the digital media landscape has the potential to lay bare the workings of industrialism. Meanwhile, digital technology itself provides us the means to reprogram many business sectors from the ground up, and in ways that distribute value to their many human stakeholders instead of merely extracting it. But doing so requires a rather radical reversal in the way we evaluate business processes and the purpose of technology itself. By reducing human beings to mere cogs in a machine, we created the conditions to worship growth over all other economic virtues. We must reckon with how and why we did this. MASS MASS MASS For a happy couple of centuries before industrialism and the modern era, the business landscape looked something like Burning Man, the famous desert festival for digital artisans.

The CEO of the CrowdFlower crowdsourcing platform, Lukas Biewald, explains that these platforms are “bringing opportunities to people who never would have had them before, and we operate in a truly egalitarian fashion, where anyone who wants to can do microtasks, no matter their gender, nationality, or socio-economic status, and can do so in a way that is entirely of their choosing and unique to them.”40 Crowdsourcing platforms, such as Amazon Mechanical Turk, pay people to perform tiny, repetitive tasks that computers just can’t handle yet. Workers log into one of the platforms from home or an Internet café and then choose from a series of tasks on offer. They might be paid three cents each time they identify the subject of a photo, transcribe a sentence from a video lecture, or list the items in a scanned receipt. These are invariably mundane tasks—the sorts of data entry that wouldn’t even exist were so many business processes not already tied to computer databases, and ones that will certainly be carried out by computers themselves sooner than later. But for now, these tasks are the province of the click workers, a growing population of several million so far, who invisibly help computers and Web sites create the illusion of mechanical perfection. (That’s why it’s particularly fitting for Amazon to have named its service after the famous eighteenth-century magic trick in which a mannequin dressed as a Turk appeared to play chess.


pages: 360 words: 96,275

PostgreSQL 9 Admin Cookbook: Over 80 Recipes to Help You Run an Efficient PostgreSQL 9. 0 Database by Simon Riggs, Hannu Krosing

business intelligence, business process, database schema, Debian, en.wikipedia.org, full text search, GnuPG, MITM: man-in-the-middle, Skype

You can only see the tables in the database to which you are currently connected, so you would need to run the same query on each database in turn. 44 Chapter 2 There's more... As I said, the number of tables in a relational database is a good measure of the complexity. Complexity of what? Well, a complex database might be designed to be deliberately flexible in order to cover a variety of business situations, or a complex business process might have a limited portion of its details covered in the database. So, a large number of tables might reveal a complex business process or maybe just a complex piece of software. The most distinct major tables I've ever seen in a database is 20,000, not counting partitions, views, or work tables. That clearly rates as a very complex system. Number of distinct tables ("entities") Complexity rating 20,000 Incredibly complex. You're either counting wrong or you have a big team to manage this 2,000 Complex business database, not many seen 200 Typical modern business database 20 Simple business database 2 Database with a single clear purpose, tightly designed for performance or some other goal 0 You haven't loaded any data yet...


pages: 344 words: 96,690

Groundswell: Winning in a World Transformed by Social Technologies by Charlene Li, Josh Bernoff

business process, call centre, centre right, citizen journalism, crowdsourcing, demand response, Donald Trump, estate planning, Firefox, John Markoff, Kickstarter, knowledge worker, Silicon Valley, skunkworks, social intelligence, Tony Hsieh

This dialogue—especially with your most active customers—inevitably draws them into your development process. You end up collaborating with your customers to create better products. That’s taking the power of psychic income and building it into your business. Whether you start with listening to, talking with, energizing, or supporting the groundswell, you’ll end up with customers in your business processes, especially those related to product development. That’s what we mean by embracing the groundswell, the topic of chapter 9. Part Two: Tapping the Groundswell Embracing the Groundswell In a tiny town in central Pennsylvania lives a guy named George. George loves his dog, Pooch. Pooch is a cockapoo, which is a fuzzy cross between a spaniel and a poodle. George and Pooch are very close.

They also wanted employees to connect in the same way as the people using their applications did—on a social network. Organism combines elements of social networks, collaboration software, and corporate intranets. According to David Feldt, a senior vice president in the Toronto office who drove the creation of Organism, “It helps the teams really get to know each other and ultimately work more effectively together.” Organic realized that people’s business process revolved around knowing each other and, more important, around the work that each person did. “Organism became an entry point for the wiki,” Chad explained. “Anything that gets updated on your profile is documented in the wiki.” Now whenever new employees join Organic, they get a page on Organism and are expected to keep it up to date with their client deliverables. Because Organism is tied directly into the company directory, anyone looking for a programmer with, say, experience creating widgets, will make Organism his first step.


pages: 391 words: 97,018

Better, Stronger, Faster: The Myth of American Decline . . . And the Rise of a New Economy by Daniel Gross

2013 Report for America's Infrastructure - American Society of Civil Engineers - 19 March 2013, Affordable Care Act / Obamacare, Airbnb, American Society of Civil Engineers: Report Card, asset-backed security, Bakken shale, banking crisis, BRICs, British Empire, business cycle, business process, business process outsourcing, call centre, Carmen Reinhart, clean water, collapse of Lehman Brothers, collateralized debt obligation, commoditize, creative destruction, credit crunch, currency manipulation / currency intervention, demand response, Donald Trump, Frederick Winslow Taylor, high net worth, housing crisis, hydraulic fracturing, If something cannot go on forever, it will stop - Herbert Stein's Law, illegal immigration, index fund, intangible asset, intermodal, inventory management, Kenneth Rogoff, labor-force participation, LNG terminal, low skilled workers, Mark Zuckerberg, Martin Wolf, Maui Hawaii, McMansion, money market fund, mortgage debt, Network effects, new economy, obamacare, oil shale / tar sands, oil shock, peak oil, plutocrats, Plutocrats, price stability, quantitative easing, race to the bottom, reserve currency, reshoring, Richard Florida, rising living standards, risk tolerance, risk/return, Silicon Valley, Silicon Valley startup, six sigma, Skype, sovereign wealth fund, Steve Jobs, superstar cities, the High Line, transit-oriented development, Wall-E, Yogi Berra, zero-sum game, Zipcar

In the past several years, I’ve been to five continents, two dozen countries, and thirty-five U.S. states. These travels have given me a chance to see firsthand many of the trends that are shaping our world. I’ve spent time with oil CEOs in Houston and solar panel makers in Boulder. I’ve visited a Prius factory in Japan and a bustling Chang’an-Ford auto plant in Chongqing, China, gas turbine factories in South Carolina and a business process outsourcing outpost in Bogotá, Colombia. I’ve chatted about the credit crunch with Warren Buffett and Blackstone Group’s chairman Stephen Schwarzman. I’ve toured thriving fish factories outside Saigon, publishing offices in Istanbul, gas stations in Soweto, and an aluminum smelter on a glacial fjord in eastern Iceland. I’ve interviewed small-town bankers and private equity magnates, American executives at Indian wind-turbine makers and Indian executives at American computer companies; dined at Davos with Nissan CEO Carlos Ghosn; and interviewed managers of 99-cent stores in Upper Manhattan.

In the halcyon years after World War II, with most of the world’s manufacturing capacity having just been destroyed, U.S. industry didn’t fret too much about improving operations. W. Edwards Deming, the chief evangelist of the gospel of quality, had to go to Japan to find a receptive audience in the 1950s. But after a couple of tough decades in which foreign competition began to erode American advantages, U.S. manufacturers rediscovered efficiency with a vengeance in the 1980s and 1990s. Total quality management, the discipline of reengineering, and the glories of business-process outsourcing transformed the manufacturing industry. In services, Walmart’s insanely efficient supply chains relentlessly drove costs out of the system and set a global standard for rational logistics. McKinsey’s armies of whip-smart technocrats roamed the globe, peddling expensive advice on how to rationalize operations. In the happy expansion of the 2000s, efficiency and internal resources were easily overlooked.


pages: 371 words: 98,534

Red Flags: Why Xi's China Is in Jeopardy by George Magnus

3D printing, 9 dash line, Admiral Zheng, Asian financial crisis, autonomous vehicles, balance sheet recession, banking crisis, Bretton Woods, BRICs, British Empire, business process, capital controls, carbon footprint, Carmen Reinhart, cloud computing, colonial exploitation, corporate governance, crony capitalism, currency manipulation / currency intervention, currency peg, demographic dividend, demographic transition, Deng Xiaoping, Doha Development Round, Donald Trump, financial deregulation, financial innovation, financial repression, fixed income, floating exchange rates, full employment, Gini coefficient, global reserve currency, high net worth, hiring and firing, Hyman Minsky, income inequality, industrial robot, Internet of things, invention of movable type, Joseph Schumpeter, Kenneth Rogoff, Kickstarter, labour market flexibility, labour mobility, land reform, Malacca Straits, means of production, megacity, money market fund, moral hazard, non-tariff barriers, Northern Rock, offshore financial centre, old age dependency ratio, open economy, peer-to-peer lending, pension reform, price mechanism, purchasing power parity, regulatory arbitrage, rent-seeking, reserve currency, rising living standards, risk tolerance, smart cities, South China Sea, sovereign wealth fund, special drawing rights, special economic zone, speech recognition, The Wealth of Nations by Adam Smith, total factor productivity, trade route, urban planning, Washington Consensus, women in the workforce, working-age population, zero-sum game

It is, basically, an efficiency term that captures the impact of technical progress and institutional arrangements that enable total GDP growth to exceed the sum of its labour and capital parts. Think, for example, of things like changes in knowledge and ‘know-how’, as opposed to information; the impact of new technologies on new products and processes; competition rules, the operation of the rule of law, and the security of contracts; the way factories or offices are organised; business processes and management techniques; and the effects of high levels of trade and commercial integration. These things all enter into economic accounting gymnastics, and are subsumed under TFP. The Nobel Prize-winning economist Paul Krugman famously drew attention to the concept of TFP when discussing the outlook for dynamic Southeast Asia in 1994 in an article entitled ‘The Myth of Asia’s Miracle’.9 Krugman’s argument was that Asia’s economic success could only be properly understood and assessed by distinguishing additions to from improvements in labour, capital and technology.

The various components of the GPT make a direct contribution to the economy, businesses, and the earnings of those who patent them. Yet there is a broader and more pervasive aspect to a GPT, which is the more indirect contribution it makes as an enabling mechanism of hundreds of complementary innovations and new products and processes in other industries and sectors. These could change the way factories and offices are structured and work, the entire transportation infrastructure in the case of driverless vehicles, business processes and corporate governance, skill structures and educational attainment, the organisation of preventative and social care, the location of manufacturing and much more. The essential point about these complementary changes is that they are disruptive, unpredictable and prone to trial and error, experimentation, and failure. These are things that sit much less comfortably in a bureaucratic, top-down and authoritarian governance structure, whose weaknesses have been outlined earlier, than in a more open, flexible and bottom-up system that encourages disruption and research-driven ideas.


pages: 344 words: 96,020

Hacking Growth: How Today's Fastest-Growing Companies Drive Breakout Success by Sean Ellis, Morgan Brown

Airbnb, Amazon Web Services, barriers to entry, Ben Horowitz, bounce rate, business intelligence, business process, correlation does not imply causation, crowdsourcing, DevOps, disruptive innovation, Elon Musk, game design, Google Glasses, Internet of things, inventory management, iterative process, Jeff Bezos, Khan Academy, Kickstarter, Lean Startup, Lyft, Mark Zuckerberg, market design, minimum viable product, Network effects, Paul Graham, Peter Thiel, Ponzi scheme, recommendation engine, ride hailing / ride sharing, side project, Silicon Valley, Silicon Valley startup, Skype, Snapchat, software as a service, Steve Jobs, subscription business, Travis Kalanick, Uber and Lyft, Uber for X, uber lyft, working poor, Y Combinator, young professional

A Harvard Business Review article about growth stalls reported that 87 percent of the companies in a large study had run into one or more periods in which growth slowed dramatically, and that “on average, companies lose 74 percent of their market capitalization…in the decade surrounding a growth stall.” What’s more, the authors emphasized that the problem will be getting worse in the future, writing that “all signs point to an increasing risk of stalls in the near future,” due to the “shrinking half-life of established business models.” Among the causes of stalled growth they cite are problems “in managing the internal business processes for updating existing products and services and creating new ones,” and “premature core abandonment: the failure to fully exploit growth opportunities in the existing core business.”12 Growth hacking is a powerful solution to both of these problems. Put simply, every company needs to grow their base of customers in order to survive and thrive. But growth hacking isn’t just about how to get new customers.

With plans to greatly expand sales in the coming years, the company has brought in talent from both the Facebook and Uber growth teams, and has announced, “We’re building a growth team from scratch to design, build and optimize scalable solutions to accelerate adoption.”17 THE NEED FOR SPEED Growth hacking is also the answer to the urgent need for speed experienced by all businesses today. Finding growth solutions fast is crucial in today’s ever-more-competitive and rapidly changing business landscape. By revolutionizing the long-established business processes for developing and launching products, institutionalizing continuous market testing, and systematically responding to the demands of the market in real time, growth hacking makes companies much more fleet-footed. It enables them to seize new opportunities and correct for problems—fast. This gives those who adopt the method a powerful competitive advantage, one that will become even more powerful as the pace of business continues to accelerate.


pages: 372 words: 101,678

Lessons from the Titans: What Companies in the New Economy Can Learn from the Great Industrial Giants to Drive Sustainable Success by Scott Davis, Carter Copeland, Rob Wertheimer

3D printing, activist fund / activist shareholder / activist investor, additive manufacturing, Airbnb, airport security, barriers to entry, business cycle, business process, clean water, commoditize, coronavirus, corporate governance, COVID-19, Covid-19, disruptive innovation, Elon Musk, factory automation, global pandemic, hydraulic fracturing, Internet of things, iterative process, low cost airline, low cost carrier, Marc Andreessen, megacity, Network effects, new economy, Ponzi scheme, profit maximization, random walk, RFID, ride hailing / ride sharing, risk tolerance, shareholder value, Silicon Valley, six sigma, skunkworks, software is eating the world, strikebreaker, Toyota Production System, Uber for X, winner-take-all economy

Figure 10.4: Restructuring boosted productivity. Source: Stanley Black & Decker filings It left the company with a battered culture, though. Union workers celebrated when CEO Trani announced his retirement in 2003. Manager reviews of the period were also tough. Trani had churned through his ranks of senior managers, losing more than he retained. He had made important strides on cost-cutting, but notably little on building sustainable business processes or a culture of success. In 2004 the company brought in John Lundgren, and SBD began to build a strong base business system. An early step was to implement Lean manufacturing, the foundation for any competent manufacturer. At SBD the move to Lean was the result of some hard lessons learned. The number of distinct products offered (stock keeping units, or SKUs) had steadily multiplied as the consumer-facing nature of the business drove an endless search for new and improved products.

Source: Stanley Black & Decker filings, press reports FROM TURNAROUND TO THE CREATION OF SFS: THE STANLEY FULFILLMENT SYSTEM Emmanuel Kampouris had decades of experience in similar businesses, having been CEO of American Standard. Board members don’t always add value to businesses, as with GE’s board rubber-stamping mistakes in the Immelt era or CAT’s board failing to ask incisive questions on the company’s China coal mining failure. In the best cases, however, corporate leaders bring expertise and forceful challenges, and that’s what Kampouris did. His push was a central part of what became the core business process: the Stanley Fulfillment System, or SFS. He challenged the company on the level of working capital it held even after making progress with Lean, arguing that it could make substantial improvements while providing better customer service. Working capital is simply money that’s tied up: inventory or accounts receivable (money not yet paid to the company), offset by bills that the company hasn’t paid yet.


pages: 370 words: 112,602

Poor Economics: A Radical Rethinking of the Way to Fight Global Poverty by Abhijit Banerjee, Esther Duflo

Albert Einstein, Andrei Shleifer, business process, business process outsourcing, call centre, Cass Sunstein, charter city, clean water, collapse of Lehman Brothers, congestion charging, demographic transition, diversified portfolio, experimental subject, hiring and firing, Kickstarter, land tenure, low skilled workers, M-Pesa, microcredit, moral hazard, purchasing power parity, randomized controlled trial, Richard Thaler, school vouchers, Silicon Valley, The Fortune at the Bottom of the Pyramid, Thomas Malthus, urban planning

In 2002, Robert Jensen of the University of California at Los Angeles teamed up with some of these centers to organize recruiting sessions for young women in randomly selected villages in rural areas where recruiters would typically not go, in three states in northern India. Not surprisingly, compared to other randomly chosen villages that did not see any such recruiting efforts, there was an increase in the employment of young women in business process outsourcing centers (BPOs) in these villages. Much more remarkably, given that this is the part of India probably most notorious for discrimination against women, three years after the recruiting started, girls age five to eleven were about 5 percentage points more likely to be enrolled in school in the villages where there was recruiting. They also weighed more, suggesting that parents were taking better care of them: They had discovered that educating girls had economic value, and were happy to invest.10 Since parents are able to respond to changes in the need for an educated labor force, the best education policy, for the demand wallahs, is no education policy.

Banerji, Rukmini Bangladesh Rehabilitation Assistance Committee (BRAC) Bank of America Banking Correspondent Act Bankruptcy Banks problems with Barker, David Basic skills, focus on Basix Becker, Gary Bed nets buying income gain and subsidized Beliefs faith and weak Ben Sedan, Allal Bhopa diseases, doctor diseases and Bloomberg, Michael Bongaarts, John Boyce, Jim Brain process Breast-feeding Bribes Burgess, Robin Business process outsourcing centers (BPOs) Businesses borrowing by investment in poor and Businesses (continued) profits for small/medium starting Calories consumption of production and Capital capitalists without human Case, Anne Castes Casual labor Centers for Disease Control Chattopadhyay, Raghabendra Chavan, Madhav Child mortality Children educated family size and as financial instruments higher-caste/lower-caste income and Chlorin Chlorine Cica Das Citibank Civil liberties Civil society Cohen, Jessica Coimbatore Collier, Paul Common Wealth (Sachs) Community Driven Development Conditional cash transfers (CCTs) Consultative Group to Assist the Poor (CGAP) Consumption Contraception access to availability of Corruption fighting Cortisol Credit Curriculum Dai Manju Das, Jishnu Data Deaton, Angus Debt freedom from Decentralization Decisionmaking family Default rates Demand wallahs Democracy in practice Depression Development economics Deworming Dhaliwal, Iqbal Diarrhea treating Dickens, Charles Diet poor and rich and Discrimination Diseases Doctor diseases, bhopa diseases and Doctors allopatic government private/public Dreze, Jean Drought Dry sand, making Duflo, Esther fertilizer and panchayat survey by Dupas, Pascaline study by Earth Institute East India Company College Easterly,William bed nets and demand wallahs and democracy and poverty traps and on RCT Economic growth Education family size and girls and income and investing in parental interest in poverty and primary quality reengineering remedial secondary value of Education for All Summit (2000) Education policy demand wallahs and supply wallahs and tools of choice in top-down “Efficient household” model Einstein, Albert Elders, caring for Emergency (1975–1977) Emptat, Ibu Entrepreneurs micro- rules of thumb and Entrepreneurship microcredit and poor and problems with rates of return for technologies and Ethnicity Experiment Faith Family extended function of Family planning encouraging Family Planning and Maternal and Child Health Program (FPMCH) Family size education and savings and Farmers insurance and suicide of Farming Fertility control over decrease in income and rates therapies Fertilizer buying using Field, Erica Financial instruments, children as Financial sector Financing Fish sauce Fogel, Robert Food aid availability of budget for consumption of income and prices Food and Drug Administration (FDA) Food prices Foreign aid Foster, Andrew Foundation for International Community Assistance (FINCA) Free markets Fruit and vegetable sellers Funerals, spending on Gandhi, Indira Gandhi, Sanjay Gates Foundation Gibbons, Donna Governments credibility for foreign aid and local problems for Gram Panchayat (GP) Gram Vikas Grameen Bank Green, Donald Green, Jennifer Green Revolution Hammer, Jeff Harlem Children’s Zone Hartman, Betsey Harvest Plus Hatch, John Health free market economists and improving investing in maternal Health care effectiveness of family size and immunizations and learning about overtreatment and problem of spending on Health insurance market for problems with providing Health shocks Health trap Helms, Brigit HIV/AIDS Hope Hospitalization Hunger Hyderabad businesses in schools in survey in Ibu Emptat Ibu Tina shock on fortunes of ICICI ICS Africa Ideology Immunization benefits of health care and incentives for information about rates Immunization camps Income agricultural children and decline in drought and education and fertility and food and growth of illness and malaria and steady/predictable Indian Council of Medical Research Indian Institute of Management Indian Institute of Technology Information collecting imperfect Infosys INPRES Institutional Revolutionary Party (PRI) Institutions bad colonial economic innovation by international manipulating political See also Microfinance institutions Insurance demand for fraud health informal poor and understanding weather Insurance companies, poor and Interest rates poor and International Child Support Intervention education government public supply-side top-down Investments Iodine Iron Iron law of oligarchy Iyer, Lakshmi Jensen, Robert Jobs buying good Johnson, Simon Jolie, Angelina Karlan, Dean KAS, bankruptcy of Kecamatan Development Project (KDP) Kennedy (farmer) Keynes, John Maynard Khanna,Tarun Khetan, Neelima Knowledge Is Power Program (KIPP) schools Kremer, Michael on chlorine dispenser fertilizers and SAFI and Kristof, Nicholas L-shape curve Law Commission of India Learning and Educational Achievement in Pakistan Schools (LEAPS) Learning to Read Lehman Brothers Lei, Miao Levy, Santiago Loans collecting on emergency government-sponsored home-equity home improvement local long-term project mandatory political priorities and poor and problems with repaying London School of Economics Lotteries, business grant M-PESA Macro programs, micro insight for Madiath, Joe Malaria eradication of Malnutrition Malthus,Thomas Maquilladoras Margin, changes at Marginal return Maternal mortality Matlab program Mbarbk, Oucha Medicare Medicine Meillassoux, Claude Microcredit effectiveness of limits of poor/future and Microfinance contracts movement Microfinance (continued) poor and poverty and repayment discipline and Microfinance institutions (MFIs) borrowing from insurance for loans from microcredit and monitoring by poor and subsidizing of successful borrowers and zero default and See also Institutions Micronutrient Initiative Micronutrients Migration Millennium Development Goals (MDGs) Miller, Nolan Miracles, underutilized Modimba, Anna Modimba, Michael Moneylenders MFIs and problems for Monitoring Mor, Nachiket Moral hazards Moyo, Dambisa Mullainathan, Sendhil Munshi, Kaivan Murthy, Narayan National Family Health Survey (NFHS 3) NGOs Nilekani, Nandan Nudges Nurses Nutrition calories and family size and income and obesity/diabetes and poverty traps and pregnancy and Olken, Benjamin Olympic Games, poor countries and Omidyar, Pierry One-child policy OPORTUNIDADES Opportunities Opportunity International Oral rehydration solution (ORS) Organization for Economic Co-operation and Development (OECD) Orwell, George Otieno, Wycliffe Pak Awan Pak Solhin poverty trap and Pak Sudarno Pande, Rohini Parmentier, Antoine Paternalism Paxson, Chris Pensions Performance Pitt, Mark Police Act (1861) Police Reform Commissions Policies anti-poverty developing education food good/bad macroeconomic one-child politics and population social Political economy Politics economics and ethnic good policies and women and Population control Population Council Population growth Population policy Population Services International (PSI) Poverty breaking cycle of decrease in education and eradicating extreme fertility and hunger and microfinance and self-control and Poverty Action Lab Poverty trap education and escaping health-based inverted L-shape and nutrition and S-shape curve and Pradhan Prahalad, C.


pages: 416 words: 106,532

Cryptoassets: The Innovative Investor's Guide to Bitcoin and Beyond: The Innovative Investor's Guide to Bitcoin and Beyond by Chris Burniske, Jack Tatar

Airbnb, altcoin, asset allocation, asset-backed security, autonomous vehicles, bitcoin, blockchain, Blythe Masters, business cycle, business process, buy and hold, capital controls, Carmen Reinhart, Clayton Christensen, clean water, cloud computing, collateralized debt obligation, commoditize, correlation coefficient, creative destruction, Credit Default Swap, credit default swaps / collateralized debt obligations, cryptocurrency, disintermediation, distributed ledger, diversification, diversified portfolio, Donald Trump, Elon Musk, en.wikipedia.org, Ethereum, ethereum blockchain, fiat currency, financial innovation, fixed income, George Gilder, Google Hangouts, high net worth, Jeff Bezos, Kenneth Rogoff, Kickstarter, Leonard Kleinrock, litecoin, Marc Andreessen, Mark Zuckerberg, market bubble, money market fund, money: store of value / unit of account / medium of exchange, moral hazard, Network effects, packet switching, passive investing, peer-to-peer, peer-to-peer lending, Peter Thiel, pets.com, Ponzi scheme, prediction markets, quantitative easing, RAND corporation, random walk, Renaissance Technologies, risk tolerance, risk-adjusted returns, Robert Shiller, Robert Shiller, Ross Ulbricht, Satoshi Nakamoto, Sharpe ratio, Silicon Valley, Simon Singh, Skype, smart contracts, social web, South Sea Bubble, Steve Jobs, transaction costs, tulip mania, Turing complete, Uber for X, Vanguard fund, WikiLeaks, Y2K

Holders of The DAO would be able to vote on what projects they wanted to support, and if developers raised enough funding from The DAO holders, they would receive the funds necessary to build their projects. Over time, investors in these projects would be rewarded through dividends or appreciation of the service provided. The vision of a decentralized autonomous organization like The DAO is somewhat like autonomous vehicles—whereas humans used to have to drive cars, the cars increasingly can drive themselves. Similarly, whereas humans used to be needed for all aspects of business processes, often in manual paper pushing, approval, orchestration, and so on, a decentralized autonomous organization can codify much of those processes so that the company better drives itself. As exciting as the concept was, The DAO was nearly Ethereum’s undoing. The creators of The DAO implemented a crowdfunding effort. Theirs surpassed the amount raised by Ethereum by nearly an order of magnitude, setting the record for the largest amount ever raised in this manner: over $168 million.24 The crowdfunding required that investments be made with ether, and because of this, by the end of the crowdfunding period The DAO team held 11.5 million ether, or 15 percent of all the ether created to that point.

Circle the Wagons Industry consortiums have been extremely popular among incumbents investigating how to apply distributed ledger technology to their industry. On one hand, a consortium makes perfect sense, as a distributed ledger needs to be shared among many parties for it to have any use. A collaborative consortium helps financial services companies—many of which have historically been competitors that keep their business processes close to their chest—learn how to share. On the other hand, these consortiums can hit snags if too many big names and big egos become involved. One of the most famous consortiums is R3, which launched on September 15, 2015, with big names such as JPMorgan, Barclays, BBVA, Commonwealth Bank of Australia, Credit Suisse, Goldman Sachs, Royal Bank of Scotland, State Street, and UBS. By the end of September, 13 more financial companies had joined, including Bank of America, BNY Mellon, Citi, Deutsche Bank, Morgan Stanley, and Toronto-Dominion Bank.


pages: 378 words: 110,518

Postcapitalism: A Guide to Our Future by Paul Mason

Alfred Russel Wallace, bank run, banking crisis, banks create money, Basel III, basic income, Bernie Madoff, Bill Gates: Altair 8800, bitcoin, Branko Milanovic, Bretton Woods, BRICs, British Empire, business cycle, business process, butterfly effect, call centre, capital controls, Cesare Marchetti: Marchetti’s constant, Claude Shannon: information theory, collaborative economy, collective bargaining, Corn Laws, corporate social responsibility, creative destruction, credit crunch, currency manipulation / currency intervention, currency peg, David Graeber, deglobalization, deindustrialization, deskilling, discovery of the americas, Downton Abbey, drone strike, en.wikipedia.org, energy security, eurozone crisis, factory automation, financial repression, Firefox, Fractional reserve banking, Frederick Winslow Taylor, full employment, future of work, game design, income inequality, inflation targeting, informal economy, information asymmetry, intangible asset, Intergovernmental Panel on Climate Change (IPCC), Internet of things, job automation, John Maynard Keynes: Economic Possibilities for our Grandchildren, Joseph Schumpeter, Kenneth Arrow, Kevin Kelly, Kickstarter, knowledge economy, knowledge worker, late capitalism, low skilled workers, market clearing, means of production, Metcalfe's law, microservices, money: store of value / unit of account / medium of exchange, mortgage debt, Network effects, new economy, Norbert Wiener, Occupy movement, oil shale / tar sands, oil shock, Paul Samuelson, payday loans, Pearl River Delta, post-industrial society, precariat, price mechanism, profit motive, quantitative easing, race to the bottom, RAND corporation, rent-seeking, reserve currency, RFID, Richard Stallman, Robert Gordon, Robert Metcalfe, secular stagnation, sharing economy, Stewart Brand, structural adjustment programs, supply-chain management, The Future of Employment, the scientific method, The Wealth of Nations by Adam Smith, Transnistria, union organizing, universal basic income, urban decay, urban planning, Vilfredo Pareto, wages for housework, WikiLeaks, women in the workforce

Management theory became a generalized discipline, not secret knowledge, with a whole cohort of consulting firms dedicated to spreading successful techniques rather than hoarding them. In this sense, the wartime economy gave birth to one of the most fundamental reflexes within the capitalism of the long boom: to solve problems through audacious technological leaps, pulling in experts from across disciplines, spreading the best practice in a sector, and changing the business process as the product itself changed. The role of the state in all this contrasts with the meagre role of finance. In all normative models of long cycles, it is finance that fuels innovation and helps capital flow into new, more productive areas. But finance had been effectively flattened during the 1930s. What emerged from the war was a very different capitalism. All it needed was a raft of new technologies – and these were plentiful: the jet engine, the integrated circuit, nuclear energy and synthetic materials.

Drucker’s answers are speculative but they provide the first glimpse of the framework on which a rigorous theory of postcapitalism would have to be based. Drucker divides the history of industrial capitalism into four phases: a mechanical revolution lasting most of the nineteenth century; a productivity revolution with the advent of scientific management in the 1890s; a management revolution after 1945, driven by the application of knowledge to business processes; and finally an information revolution, based on ‘the application of knowledge to knowledge’. Drucker, a pupil of Schumpeter, was consciously using the Kondratieff long cycles here (although merging the first two together), but seen from the viewpoint of the individual firm. This leads to Drucker’s most profound observation: that none of these turning points can be grasped without understanding the economics of work.


When Cultures Collide: Leading Across Cultures by Richard D. Lewis

Ayatollah Khomeini, British Empire, business climate, business process, colonial exploitation, corporate governance, global village, haute cuisine, hiring and firing, invention of writing, lateral thinking, Mahatma Gandhi, mass immigration, Nelson Mandela, new economy, oil shale / tar sands, old-boy network, open borders, profit maximization, profit motive, Scramble for Africa, Silicon Valley, trade route, transaction costs, upwardly mobile, urban sprawl, women in the workforce

Long “Dutch debates” lead to action, taken at the top, but with constant reference to the “ranks.” Ideas from low levels are allowed to filter freely upward in the hierarchy. Indonesia In colonial times, leadership came from the Dutch. Under Sukarno and Suharto leadership was exercised principally by the military and was therefore autocratic. The indifferent nature of many Indonesians to the business process has, 120 WHEN CULTURES COLLIDE however, resulted in a lot of business management being entrusted to a resident Chinese professional class, which has the commercial know-how and international connections. Overseas Chinese shareholding in many Indonesian companies encourages this situation. Japan Japanese top executives have great power in conformity with Confucian hierarchy, but actually have little involvement in the everyday affairs of the company.

Culture Values loquacity hierarchy desire to please family no work ethic in the Protestant sense age is respected polygamy is permitted but rare face saving courtesy gentleness friendly hospitality unity and conformity avoidance of confrontation adat customary law usually prevails over Islam Concepts Leadership and Status Leaders are expected to be paternalistic and are usually from chosen families or emanate from the higher ranks in the army. Leaders often seek consensus, which is the mode followed by all persons. In colonial times, leadership came from the Dutch. Under Sukarno and Suharto, leadership was exercised principally by the military and therefore was autocratic. The indifferent nature of many Indonesians to the business process has, however, resulted in a lot of business management being entrusted to resident Chinese. The Chinese professional class has the commercial know-how and international connections. Overseas Chinese shareholding in many Indonesian companies encourages this situation. 456 WHEN CULTURES COLLIDE Space and Time Indonesians are used to being crowded. They are comfortable in a group and need relatively little personal space.

Meetings begin with protracted small talk in order for people to get to know each other and to formulate a mutually appropriate approach to the objectives in question. You should enjoy the conversation and leave the initiation of the serious business talk in Colombian hands. They have an innate sense of timing in this respect. It is not unusual for preparatory discussions to be accompanied by some refreshment—even lunch or dinner. Colombian businesspeople regard hospitality as an integral part of the business process. Remember that personal relationships dominate business deals. Once issues are tackled, the senior Colombian may outline the general approach to the project, painting with a broad brush, avoiding details at this stage. Accord this senior figure great respect (reciprocating the deference he or she will accord you). The accompanying (subordinate) Colombians will at all times respect the hierarchical position of their leader, but specialists are allowed to voice their opinions without inhibition.


pages: 161 words: 39,526

Applied Artificial Intelligence: A Handbook for Business Leaders by Mariya Yao, Adelyn Zhou, Marlene Jia

Airbnb, Amazon Web Services, artificial general intelligence, autonomous vehicles, business intelligence, business process, call centre, chief data officer, computer vision, conceptual framework, en.wikipedia.org, future of work, industrial robot, Internet of things, iterative process, Jeff Bezos, job automation, Marc Andreessen, natural language processing, new economy, pattern recognition, performance metric, price discrimination, randomized controlled trial, recommendation engine, self-driving car, sentiment analysis, Silicon Valley, skunkworks, software is eating the world, source of truth, speech recognition, statistical model, strong AI, technological singularity

Companies that don’t traditionally build end-user technology often don’t have CTOs, which can make transitions challenging if they want to create digital experiences for customers without relying on external agencies. CIO Chief Information Officers manage technology and infrastructure that underpin their company’s business operations. The CIO runs an organization’s IT and Operations to streamline and support business processes. Unlike the CTO, the CIO’s customers are internal users, functional departments, and business units. CIOs typically adapt and integrate third-party infrastructure solutions to meet their unique business needs and do less custom development than CTOs do. For non-technology companies, the CIO can be the right stakeholder if the primary benefits of adopting AI lie in improving analytics and business operations rather than in functions that affect external customers, such as in sales and marketing.


pages: 391 words: 117,984

The Blue Sweater: Bridging the Gap Between Rich and Poor in an Interconnected World by Jacqueline Novogratz

access to a mobile phone, Ayatollah Khomeini, Berlin Wall, business process, business process outsourcing, clean water, failed state, Fall of the Berlin Wall, half of the world's population has never made a phone call, Hernando de Soto, Kibera, Lao Tzu, market design, microcredit, Nelson Mandela, out of africa, Ronald Reagan, sensible shoes, side project, Silicon Valley, Skype, The Fortune at the Bottom of the Pyramid, transaction costs, zero-sum game

A doctor friend of Satyan’s replied that open defecation was one of the biggest public health issues the area faced, reminding us that some health investments are best undertaken through effective awareness campaigns, not through medicines or direct services. Against this backdrop, we sat in a circle under tall green trees outside Satyan’s childhood home, cows lolling in the distance. Satyan pulled out his computer to show us the work he was doing to establish a business processing outsourcing (BPO) unit here. Already, he’d secured wireless, and sure enough, in this tiny village so far away from everything, we were able to check my e-mail and read the New York Times. Inside a small house, six young men sat inputting data for a bank in Delhi, all earning more than they had ever dreamed they could. A 17-year-old, too young to work at the BPO, introduced himself and showed us the Web site he had built.

See Blue bakery Banks, 7, 268 Bartering, 65–66 Bassani, Bilge Ogun, 39–40, 53 Beatrice (Jamii Bora member), 273–74 Biko, Stephen (Steve), 101 Bill and Melinda Gates Foundation, 264, 270 Bilo (Kenyan security guard), 92 Blackwell, Angela Glover, 154–55 Blackwell, Unita, 159–60 Blue bakery accounting and accountability problems of, 79–80 Consolata and, 75, 78–81, 81 expansion of, 87 financing, 75–76 founding of, 72–76 Gaudence and, 75, 80–81, 85–86 growth of, 79, 82–83, 87–88 Honorata and, 73–77, 78 Josepha and, 75, 83, 86 legacy of, 164 lessons learned from, 86, 88 messages of, 88 painting building of, 85–86 postgenocide, 163–64 Prisca and, 74–78, 79–85, 88 Prudence and, 72 quality control and, 88 sales tactics of, 78–79, 80–81 setbacks of, 83, 86–88 success of, 113 Blue sweater story, 1–3, 272 Bohri woman, 236–37 Boniface (Rwandan driver), 37–39, 42, 47, 64–67, 72, 78–79, 83, 86, 106–7, 163 BPO, 233 Brazil, 7–8 Bride price, 62–63 Bright, Rita, 156–57 Brown, Tim, 230 Buddha, 146 Buffet, Warren, 284 Burundi, 13, 51 Business processing outsourcing (BPO), 233 Buxbaum, David, 220, 226 C Cambodia, 144–45 Capitalism, future of, 136 Carnegie, Andrew, 143 Catfish factories (Mississippi Delta), 159–61 Catherine (Acumen Fund fellow), 278 Cesare (Rwandan doctor), 90 Charity, traditional, 76, 151, 211, 218, 228–29 Charles (Novogratz’s friend), 84–85, 108–10, 113, 120–25 Charlotte (restaurant proprietor), 205–7, 262 Chase Manhattan Bank, 5–7, 11, 56, 64 Chloroquine, 255–56 Choices, 115 Chowdhury (Indian guide), 118–19, 267 Churchill, Winston, 17 Cisco Foundation, 217, 220–21 Cissy (Ugandi woman), 17–19 Citibank, 238 Citizens Foundation, 280 Collaboration, 280 Collette (Honorata’s mother), 167–68, 174–75 Colombia, 158–59 Committee decision making, 139 Community and community work, 4, 55, 284 Consolata (blue bakery worker), 75, 78–81, 83 Constance (Rwandan parliamentarian), 46–49, 63–64 Conviction, 284 Conway, Sir Gordon, 213–14 COOPEDU (credit union), 206 Corruption, 98–99, 184, 211–12 Cost of Good Intentions, The (report), 148–49, 151 Cote d’Ivoire, 15, 19–28, 63 Cry Freedom (film), 101 D Dalit caste, 247 Damascene (office assistant), 112 Dativa (bank executive director), 203 Davidson, Stuart, 215–17 Democracy, attempts to impose, 187–88 Dhammayietra (pilgrimage), 144–45 Dieu Donne (Zairean artist), 57, 126, 204 Discipline, 272 Diversity, 154–55, 188 Doctors without Borders, 171 Dot-com boom, 213, 217 Drayton, Bill, 214–15 Drip irrigation projects, 247–51 Drishtee, 231–33, 275 Duncan (engineer), 131–32 Duterimbere.


pages: 379 words: 113,656

Six Degrees: The Science of a Connected Age by Duncan J. Watts

Berlin Wall, Bretton Woods, business process, corporate governance, Drosophila, Erdős number, experimental subject, fixed income, Frank Gehry, Geoffrey West, Santa Fe Institute, industrial cluster, invisible hand, Long Term Capital Management, market bubble, Milgram experiment, MITM: man-in-the-middle, Murray Gell-Mann, Network effects, new economy, Norbert Wiener, Paul Erdős, peer-to-peer, rolodex, Ronald Coase, scientific worldview, Silicon Valley, supply-chain management, The Nature of the Firm, The Wealth of Nations by Adam Smith, Toyota Production System, transaction costs, transcontinental railway, Vilfredo Pareto, Y2K

I had given one too many talks on the small-world problem by that stage, and as I motored through my usual spiel, I was mostly hoping not to put anyone to sleep. So it was much to my surprise that as I was packing up afterward, Chuck came rushing up to me waving his hands urgently and insisting that we had to talk. Inasmuch as I understood anything about Chuck’s work, it concerned the evolution of modern manufacturing and business processes, and so had nothing to do with me. Furthermore, I couldn’t understand a word he was saying. Although Chuck, as I eventually discovered, is a fantastically interesting thinker, his manner is that of the intense, Harvard-trained intellectual that he is, replete with intimidating vocabulary, labyrinthine reasoning, and abstract conclusions. Listening to Chuck think is like drinking wine from a fire hose—it’s good stuff, but it can still drown you.

In fast-moving industries from software to automobiles, designs are rarely final before production itself has commenced, and performance benchmarks evolve along with the project. Furthermore, no one person’s role in the overall scheme is ever precisely specified in advance. Rather, each person starts with a general notion of what is required of him or her, and refines that notion only by interacting with other problem solvers (who, of course, are doing the same). The true ambiguity of modern business processes, in other words, is not just that the environment necessitates continual redesign of the production process but that design itself, along with innovation and trouble shooting, is a task to be performed, not only at the same time as the task of production but also in the same decentralized fashion. When environmental ambiguity is low—that is, when change occurs slowly and the future is predictable—then this fundamental task ambiguity is suppressed, effectively allowing the design/learning and production phases to be completed separately.


pages: 141 words: 40,979

The Little Book That Builds Wealth: The Knockout Formula for Finding Great Investments by Pat Dorsey

Airbus A320, barriers to entry, business process, call centre, creative destruction, credit crunch, discounted cash flows, intangible asset, knowledge worker, late fees, low cost airline, low cost carrier, Network effects, pets.com, price anchoring, risk tolerance, risk/return, rolodex, shareholder value, Stewart Brand

The moats that do exist in consumer services—companies like Bed Bath & Beyond, Best Buy, Target, or Starbucks—are generally the result of getting a lot of little things consistently right for years, which results in the kind of dependable consumer experience that drives loyalty and repeat traffic. It can be done, but it’s not easy. Companies that provide services to businesses are in many ways the polar opposite of the restaurants and retailers. This sector has one of the highest percentages of wide-moat companies in Morningstar’s coverage universe, and that’s largely because these firms are often able to integrate themselves so tightly into their clients’ business processes that they create very high switching costs, giving them pricing power and excellent returns on capital. Data processors like DST Systems and Fiserv fall into this category, as do companies with impossible-to-replicate databases, like IMS Health (prescription drugs) or Dun & Bradstreet and Equifax (credit histories). This part of the market also has an outsize number of niche-dominating firms like Stericycle (medical waste), Moody’s Investors Service (bond ratings), FactSet (financial data aggregation), and Blackbaud (fund-raising software for nonprofits).


pages: 492 words: 118,882

The Blockchain Alternative: Rethinking Macroeconomic Policy and Economic Theory by Kariappa Bheemaiah

accounting loophole / creative accounting, Ada Lovelace, Airbnb, algorithmic trading, asset allocation, autonomous vehicles, balance sheet recession, bank run, banks create money, Basel III, basic income, Ben Bernanke: helicopter money, bitcoin, blockchain, Bretton Woods, business cycle, business process, call centre, capital controls, Capital in the Twenty-First Century by Thomas Piketty, cashless society, cellular automata, central bank independence, Claude Shannon: information theory, cloud computing, cognitive dissonance, collateralized debt obligation, commoditize, complexity theory, constrained optimization, corporate governance, creative destruction, credit crunch, Credit Default Swap, credit default swaps / collateralized debt obligations, crowdsourcing, cryptocurrency, David Graeber, deskilling, Diane Coyle, discrete time, disruptive innovation, distributed ledger, diversification, double entry bookkeeping, Ethereum, ethereum blockchain, fiat currency, financial innovation, financial intermediation, Flash crash, floating exchange rates, Fractional reserve banking, full employment, George Akerlof, illegal immigration, income inequality, income per capita, inflation targeting, information asymmetry, interest rate derivative, inventory management, invisible hand, John Maynard Keynes: technological unemployment, John von Neumann, joint-stock company, Joseph Schumpeter, Kenneth Arrow, Kenneth Rogoff, Kevin Kelly, knowledge economy, large denomination, liquidity trap, London Whale, low skilled workers, M-Pesa, Marc Andreessen, market bubble, market fundamentalism, Mexican peso crisis / tequila crisis, MITM: man-in-the-middle, money market fund, money: store of value / unit of account / medium of exchange, mortgage debt, natural language processing, Network effects, new economy, Nikolai Kondratiev, offshore financial centre, packet switching, Pareto efficiency, pattern recognition, peer-to-peer lending, Ponzi scheme, precariat, pre–internet, price mechanism, price stability, private sector deleveraging, profit maximization, QR code, quantitative easing, quantitative trading / quantitative finance, Ray Kurzweil, Real Time Gross Settlement, rent control, rent-seeking, Satoshi Nakamoto, Satyajit Das, savings glut, seigniorage, Silicon Valley, Skype, smart contracts, software as a service, software is eating the world, speech recognition, statistical model, Stephen Hawking, supply-chain management, technology bubble, The Chicago School, The Future of Employment, The Great Moderation, the market place, The Nature of the Firm, the payments system, the scientific method, The Wealth of Nations by Adam Smith, Thomas Kuhn: the structure of scientific revolutions, too big to fail, trade liberalization, transaction costs, Turing machine, Turing test, universal basic income, Von Neumann architecture, Washington Consensus

Currently when making a transfer, apart from the sender’s and receiver’s banks, the flow of money includes the involvement of non-bank companies (such as Western Union), the correspondent bank which deals with foreign exchange, the clearing networks (such as SWIFT and ACH21), and regulators from central banks and financial authorities that monitor KYC and AML standards. As there are many separate players involved, the information about the sender needs to be verified by each participant, which results in repetitive business processes, accumulated costs, delays, errors, and multiple operations. However, as we have seen in Sidebars 2-2 and 2-3, this system is currently in a state of flux. Companies like M-Pesa are allowing the unbanked to send and receive payments without depending on the traditional players, and companies like Transferwise22 are reducing the FOREX risk that is involved in cross-border transactions. If the Blockchain were to be inculcated in this value exchange process, it would further streamline the entire transaction.

As stated before, one of the Blockchain’s main advantages is that it is an infrastructural tool. The fact that it offers public and private operational features also makes it relatively malleable. We can imagine a scenario in which a newly created firm approaches a government institution and applies for a licence to trade on its sovereign Blockchain, much like in the same way that a firm has to register its company status. Once the KYB (Know Your Business) process is done, the firm begins to transact and the validation of these transactions can be done by registered governmental bodies or private enterprises that offer this service and which have a license to perform this function. This idea is not a far stretch from the existing practices, and Blockchain-based initiatives like this are already being deployed. Consider the case of Ripple. In the Ripple protocol, the validation is done by a process called consensus, rather than proof of work.


pages: 448 words: 117,325

Click Here to Kill Everybody: Security and Survival in a Hyper-Connected World by Bruce Schneier

23andMe, 3D printing, autonomous vehicles, barriers to entry, bitcoin, blockchain, Brian Krebs, business process, cloud computing, cognitive bias, computer vision, connected car, corporate governance, crowdsourcing, cryptocurrency, cuban missile crisis, Daniel Kahneman / Amos Tversky, David Heinemeier Hansson, Donald Trump, drone strike, Edward Snowden, Elon Musk, fault tolerance, Firefox, Flash crash, George Akerlof, industrial robot, information asymmetry, Internet of things, invention of radio, job automation, job satisfaction, John Markoff, Kevin Kelly, license plate recognition, loose coupling, market design, medical malpractice, Minecraft, MITM: man-in-the-middle, move fast and break things, move fast and break things, national security letter, Network effects, pattern recognition, profit maximization, Ralph Nader, RAND corporation, ransomware, Rodney Brooks, Ross Ulbricht, security theater, self-driving car, Shoshana Zuboff, Silicon Valley, smart cities, smart transportation, Snapchat, Stanislav Petrov, Stephen Hawking, Stuxnet, The Market for Lemons, too big to fail, Uber for X, Unsafe at Any Speed, uranium enrichment, Valery Gerasimov, web application, WikiLeaks, zero day

The National Institute of Standards and Technology’s “Framework for Improving Critical Infrastructure Cybersecurity” is a great example of this type of standard. It’s a comprehensive guide for private-sector organizations to proactively assess and minimize their cybersecurity risk. Standards regulating business processes, like how to prevent, detect, and respond to cyberattacks, are also important. If done right, these can motivate businesses to improve their overall Internet security and make better decisions about which technologies to buy and how to use them. Less obviously, standardizing these types of business processes also makes it easier for business executives to share ideas, impose requirements on third-party partners, and tie security standards to insurance. They also serve as a model for best practices in litigation, and courts can refer to them when making decisions.


pages: 316 words: 117,228

The Code of Capital: How the Law Creates Wealth and Inequality by Katharina Pistor

"Robert Solow", Andrei Shleifer, Asian financial crisis, asset-backed security, barriers to entry, Bernie Madoff, bilateral investment treaty, bitcoin, blockchain, Bretton Woods, business cycle, business process, Capital in the Twenty-First Century by Thomas Piketty, Carmen Reinhart, central bank independence, collateralized debt obligation, colonial rule, conceptual framework, Corn Laws, corporate governance, creative destruction, Credit Default Swap, credit default swaps / collateralized debt obligations, cryptocurrency, Donald Trump, double helix, Edward Glaeser, Ethereum, ethereum blockchain, facts on the ground, financial innovation, financial intermediation, fixed income, Francis Fukuyama: the end of history, full employment, global reserve currency, Hernando de Soto, income inequality, intangible asset, investor state dispute settlement, invisible hand, joint-stock company, joint-stock limited liability company, Joseph Schumpeter, Kenneth Rogoff, land reform, land tenure, London Interbank Offered Rate, Long Term Capital Management, means of production, money market fund, moral hazard, offshore financial centre, phenotype, Ponzi scheme, price mechanism, price stability, profit maximization, railway mania, regulatory arbitrage, reserve currency, Ronald Coase, Satoshi Nakamoto, secular stagnation, self-driving car, shareholder value, Silicon Valley, smart contracts, software patent, sovereign wealth fund, The Nature of the Firm, The Wealth of Nations by Adam Smith, Thorstein Veblen, time value of money, too big to fail, trade route, transaction costs, Wolfgang Streeck

Intangible Capital At long last, economists have discovered that capital is not a thing, but a quality, although most don’t know it yet. In a recent book entitled Capitalism without Capital, Haskel and Westlake argue that the market value of leading corporations today is not determined by the physical assets they own and use to produce goods, but by intangibles: the patents, copyrights, and trademarks they own, and 116 c h a P te r 5 the branding and business processes they have developed.25 However, the authors limit the definition of capital to physical things that you can see and touch, and therefore conclude that we live in a wondrous new world of capitalism without capital. This happens when one relies on the outward appearance of things and ignores the code that determines their look, for appearances can be deceiving. Haskel and Westlake are not oblivious to law; in their book, they even compile a table that lists variants of intangibles and map them into their treatment in law on one hand, and in national accounts on the other.26 As they show, about half of the intangible investments are not recognized in national accounts; but law has a label for all of them, called patents, trademarks, property rights, and a catchall category of “other,” which can be deciphered as trade secrets as well as business processes.

Haskel and Westlake are not oblivious to law; in their book, they even compile a table that lists variants of intangibles and map them into their treatment in law on one hand, and in national accounts on the other.26 As they show, about half of the intangible investments are not recognized in national accounts; but law has a label for all of them, called patents, trademarks, property rights, and a catchall category of “other,” which can be deciphered as trade secrets as well as business processes. Still, the authors hesitate to draw the obvious conclusion that there is a powerful link between law and intangibles, indeed, that the law is the source code for transforming ideas, skills, know-how, even processes, into capital. The reluctance of these accounting experts to cut through their own belief structure resonates with the late US Supreme Court Justice Scalia’s personal struggle over the scientific basis of the BRCA case against Myriad.


pages: 441 words: 136,954

That Used to Be Us by Thomas L. Friedman, Michael Mandelbaum

addicted to oil, Affordable Care Act / Obamacare, Albert Einstein, Amazon Web Services, American Society of Civil Engineers: Report Card, Andy Kessler, Ayatollah Khomeini, bank run, barriers to entry, Berlin Wall, blue-collar work, Bretton Woods, business process, call centre, carbon footprint, Carmen Reinhart, Cass Sunstein, centre right, Climatic Research Unit, cloud computing, collective bargaining, corporate social responsibility, creative destruction, Credit Default Swap, crowdsourcing, delayed gratification, energy security, Fall of the Berlin Wall, fear of failure, full employment, Google Earth, illegal immigration, immigration reform, income inequality, Intergovernmental Panel on Climate Change (IPCC), job automation, Kenneth Rogoff, knowledge economy, Lean Startup, low skilled workers, Mark Zuckerberg, market design, mass immigration, more computing power than Apollo, Network effects, obamacare, oil shock, pension reform, Report Card for America’s Infrastructure, rising living standards, Ronald Reagan, Rosa Parks, Saturday Night Live, shareholder value, Silicon Valley, Silicon Valley startup, Skype, Steve Jobs, the scientific method, Thomas L Friedman, too big to fail, University of East Anglia, WikiLeaks

A breakthrough product, such as the iPhone, instantly generates competition—the Android. Within months, the iPad had multiple competitors. So a company that does not practice constant innovation by taking advantage of every ounce of brainpower at every level will fall behind farther and faster than ever before. Before the world became hyper-connected, American companies moved jobs around the world—that is, they outsourced parts of their business process—to save money that they then reinvested in new products, services, and people in the United States, because they could. Now companies move jobs around the world to do “crowdsourcing” and distributed innovation, because they must. They find the most creative brainpower, the most productive workforce, the most inviting tax rules, and the best infrastructure in or near the fastest-growing markets, because they must.

Nazis Nelakanti, Raman Venkat Nepal Netflix Netscape Network for Teaching Entrepreneurship (NFTE) Nevada New Deal New Haven (Connecticut) public schools New Jersey New Leaders for New Schools New York City; JFK Airport; Penn Station; public schools New Yorker, The New York Mets baseball team New York State New York Stock Exchange New York Times New York Times–Discovery Channel New York Yankees baseball team New Zealand Nike Nixon, Richard Nixon Peabody law firm Nobel Prize No Child Left Behind Act (2002) Noida (India) Nordhaus, William North American Free Trade Agreement (NAFTA; 1994) North Carolina Northport (Alabama) Northwestern University NPR nuclear power Nuclear Regulatory Commission nuclear weapons Nueva School (Hillsborough, California) O Oakwood Medical Investors Obama, Barack; budget and deficit under; Clinton appointed secretary of state by; education encouraged by; energy policy and; health-care plan of; inauguration of; overseas travel of; review of regulations ordered by O’Connell, Jerry O’Connor, Carroll Ohio Old Lyme (Connecticut) Middle School Olson, Mancur Olympic Games O’Neill, Paul One Percent Doctrine, The (Suskind) OODA loop Organisation for Economic Cooperation and Development (OECD); Programme for International Student Assessment (PISA) Organization of Petroleum Exporting Countries (OPEC) Otellini, Paul Out of Our Minds (Robinson) outsourcing; climate change and; of customer service; immigration policies versus; of parts of business processes P Pacific Railway Acts (1862; 1864) Pahlavi, Mohammad Reza, Shah of Iran Pakistan Palmeiro, Rafael Palmisano, Samuel PalmPilot Parks, Rosa Partners for Livable Communities Pasteur, Louis Patent Act (1790) Patent and Trademark Office, U.S. Paul, Rand Paul, Ron Paul, Vivek PCs, see personal computers Peace Corps Pearl Harbor, Japanese attack on Pearlstein, Steven Peking University Pell Grants Pence, Mike Pentagon; terrorist attack on, see September 11 People magazine People of Plenty (Potter) People’s Daily Perez, Raul Perino, Dana Perkins Pancake House (Minneapolis) Perot, H.


Presentation Zen Design: Simple Design Principles and Techniques to Enhance Your Presentations by Garr Reynolds

Albert Einstein, barriers to entry, business intelligence, business process, cloud computing, Everything should be made as simple as possible, Hans Rosling, Kickstarter, lateral thinking, Richard Feynman, Silicon Valley, women in the workforce, Yogi Berra

Much the same could be said of design—about learning to see and think more visually. Teachers are necessary and important and they can point the way. But in the end, it’s always up to us to learn it, and most of our learning now is a result of our own efforts and our lifelong commitment to continuous improvement through education outside the classroom. Long-Term Improvement: Kaizen The Japanese term kaizen () means “improvement,” literally change + good. In relation to business processes, however, kaizen more closely resembles “continuous improvement.” Kaizen is rooted in the principles of total quality management brought to Japan after World War II by statistician W. Edwards Deming and others. Kaizen is key to the steady improvement and innovation of successful companies in Japan such as Toyota. In the book The Elegant Solution: Toyota’s Formula for Mastering Innovation (Free Press, 2006), author Matthew May says, “Kaizen is one of those magical concepts that is at once a philosophy, a principle, a practice, and a tool.”


pages: 162 words: 50,108

The Little Book of Hedge Funds by Anthony Scaramucci

Andrei Shleifer, asset allocation, Bernie Madoff, business process, carried interest, corporate raider, Credit Default Swap, diversification, diversified portfolio, Donald Trump, Eugene Fama: efficient market hypothesis, fear of failure, fixed income, follow your passion, Gordon Gekko, high net worth, index fund, John Meriwether, Long Term Capital Management, mail merge, margin call, mass immigration, merger arbitrage, money market fund, Myron Scholes, NetJets, Ponzi scheme, profit motive, quantitative trading / quantitative finance, random walk, Renaissance Technologies, risk-adjusted returns, risk/return, Ronald Reagan, Saturday Night Live, Sharpe ratio, short selling, Silicon Valley, Thales and the olive presses, Thales of Miletus, the new new thing, too big to fail, transaction costs, Vanguard fund, Y2K, Yogi Berra, zero-sum game

I was passionate about entrepreneurship and the markets from a very young age. By my early 30s, I believed I had acquired sufficient experience investing in diverse strategies across various asset classes to start my own fund. While I was well prepared to begin managing money, I underestimated the importance of having a deep background in business management and leadership, which I have learned on the job. Studying and applying principled business processes is as important as honing your investment skills if your goal is to scale a hedge fund successfully. 3. What hedge fund strategies do you use? Multistrategy with a focus on event-driven special situations. 4. What do you see as the future of the industry? Firms with great leadership, high quality teams, thoughtful idea generation processes, and well-articulated investment frameworks will continue to grow.


pages: 237 words: 50,758

Obliquity: Why Our Goals Are Best Achieved Indirectly by John Kay

Andrew Wiles, Asian financial crisis, Berlin Wall, bonus culture, British Empire, business process, Cass Sunstein, computer age, corporate raider, credit crunch, Daniel Kahneman / Amos Tversky, discounted cash flows, discovery of penicillin, diversification, Donald Trump, Fall of the Berlin Wall, financial innovation, Gordon Gekko, greed is good, invention of the telephone, invisible hand, Jane Jacobs, lateral thinking, Long Term Capital Management, Louis Pasteur, market fundamentalism, Myron Scholes, Nash equilibrium, pattern recognition, Paul Samuelson, purchasing power parity, RAND corporation, regulatory arbitrage, shareholder value, Simon Singh, Steve Jobs, Thales of Miletus, The Death and Life of Great American Cities, The Predators' Ball, The Wealth of Nations by Adam Smith, ultimatum game, urban planning, value at risk

If we know enough about such a problem—its objectives, its possibilities, its interactions—we do not have to worry about sharing our high-level objectives with those who are chiseling the stone. We can describe the problem comprehensively from the outset and hence specify appropriate actions. We can pay our agents bonuses and fire them when they fail to meet our targets. That is what Lenin, the modernist architects and the business process reengineers believed. But they were wrong. The Soviet Union collapsed, the Pruitt-Igoe project was demolished and the people who transformed the business world were not the men who employed armies of reengineering consultants. The people who did transform the business world were those, like Google’s Sergey Brin and Apple’s Steve Jobs, who adopted a more oblique approach to business transformation.


pages: 165 words: 50,798

Intertwingled: Information Changes Everything by Peter Morville

A Pattern Language, Airbnb, Albert Einstein, Arthur Eddington, augmented reality, Bernie Madoff, Black Swan, business process, Cass Sunstein, cognitive dissonance, collective bargaining, disruptive innovation, index card, information retrieval, Internet of things, Isaac Newton, iterative process, Jane Jacobs, John Markoff, Lean Startup, Lyft, minimum viable product, Mother of all demos, Nelson Mandela, Paul Graham, peer-to-peer, RFID, Richard Thaler, ride hailing / ride sharing, Schrödinger's Cat, self-driving car, semantic web, sharing economy, Silicon Valley, Silicon Valley startup, source of truth, Steve Jobs, Stewart Brand, Ted Nelson, The Death and Life of Great American Cities, the scientific method, The Wisdom of Crowds, theory of mind, uber lyft, urban planning, urban sprawl, Vannevar Bush, zero-sum game

And we started making maps for mobile and cross-channel services and experiences to help our clients and colleagues to see and understand what’s possible and desirable. We realized that, in the modern era of cross-channel experiences and product-service systems, it makes less and less sense to design taxonomies, sitemaps, and wireframes without also mapping the customer journey, modeling the system dynamics, and analyzing the impacts upon business processes, incentives, and the org chart. As our practice evolved and the gap between classic and contemporary information architecture grew, our community struggled to explain itself, so much so we earned a hashtag (#dtdt) for “defining the damn thing.” And while accusations of navel-gazing were not without merit, this was a necessary, productive struggle that helped us shed a web-centric worldview in favor of a medium-independent perspective.


Design of Business: Why Design Thinking Is the Next Competitive Advantage by Roger L. Martin

asset allocation, Buckminster Fuller, business process, Frank Gehry, global supply chain, high net worth, Innovator's Dilemma, Isaac Newton, mobile money, QWERTY keyboard, Ralph Waldo Emerson, risk tolerance, six sigma, Steve Ballmer, Steve Jobs, supply-chain management, Wall-E, winner-take-all economy

Third, it created a global shared services organization (Global Business Services or GBS) to deliver employee