business process

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

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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, supply-chain management

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 70 Chapter 3 ■ ■ ■ ■ ■ ■ 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.

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 Retail Sales 71 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.

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 Data Warehousing, Business Intelligence, and Dimensional Modeling Primer 33 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.

Writing Effective Use Cases by Alistair Cockburn

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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: 133 words: 42,254

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

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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: 791 words: 85,159

Social Life of Information by John Seely Brown, Paul Duguid

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AltaVista, business process, Claude Shannon: information theory, computer age, cross-subsidies, disintermediation, double entry bookkeeping, Frank Gehry, frictionless, frictionless market, future of work, George Gilder, global village, Howard Rheingold, informal economy, information retrieval, invisible hand, Isaac Newton, Just-in-time delivery, Kevin Kelly, knowledge economy, knowledge worker, loose coupling, Marshall McLuhan, medical malpractice, moral hazard, Network effects, new economy, Productivity paradox, rolodex, Ronald Coase, shareholder value, 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.


pages: 227 words: 32,306

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

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barriers to entry, business intelligence, business process, call centre, cloud computing, 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.


pages: 347 words: 97,721

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

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AI winter, Andy Kessler, artificial general intelligence, asset allocation, Automated Insights, autonomous vehicles, Baxter: Rethink Robotics, business intelligence, business process, call centre, carbon-based life, Clayton Christensen, clockwork universe, conceptual framework, dark matter, David Brooks, deliberate practice, deskilling, Edward Lloyd's coffeehouse, Elon Musk, Erik Brynjolfsson, estate planning, follow your passion, Frank Levy and Richard Murnane: The New Division of Labor, Freestyle chess, game design, general-purpose programming language, 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 Maynard Keynes: Economic Possibilities for our Grandchildren, John Maynard Keynes: technological unemployment, Khan Academy, knowledge worker, labor-force participation, 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, Richard Feynman, risk tolerance, Robert Shiller, Robert Shiller, Rodney Brooks, Second Machine Age, self-driving car, Silicon Valley, six sigma, Skype, 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.

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

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Affordable Care Act / Obamacare, barriers to entry, business process, Claude Shannon: information theory, Clayton Christensen, conceptual framework, corporate governance, Daniel Kahneman / Amos Tversky, discounted cash flows, diversified portfolio, double entry bookkeeping, Exxon Valdez, financial innovation, fixed income, hydraulic fracturing, index fund, inventory management, Joseph Schumpeter, 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: 161 words: 44,488

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

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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 blockchain, fault tolerance, fiat currency, global value chain, Innovator's Dilemma, Internet of things, Kevin Kelly, Kickstarter, market clearing, Network effects, new economy, peer-to-peer lending, prediction markets, pull request, 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

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Automated Insights, autonomous vehicles, bioinformatics, business intelligence, business process, call centre, chief data officer, cloud computing, data acquisition, Edward Snowden, Erik Brynjolfsson, intermodal, Internet of things, Jeff Bezos, knowledge worker, Mark Zuckerberg, 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

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

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Albert Einstein, Amazon Web Services, business intelligence, business process, call centre, cloud computing, corporate governance, credit crunch, crowdsourcing, defense in depth, en.wikipedia.org, fault tolerance, Firefox, loose coupling, market design, Monroe Doctrine, new economy, Nicholas Carr, Nick Leeson, Norbert Wiener, optical character recognition, packet switching, performance metric, pirate software, 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, x509 certificate, 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.


pages: 314 words: 94,600

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

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affirmative action, bioinformatics, 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: 209 words: 80,086

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

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affirmative action, barriers to entry, Branko Milanovic, BRICs, business process, business process outsourcing, call centre, collective bargaining, corporate governance, credit crunch, David Ricardo: comparative advantage, deindustrialization, deskilling, Frederick Winslow Taylor, full employment, future of work, glass ceiling, global supply chain, immigration reform, income inequality, industrial robot, job automation, Joseph Schumpeter, knowledge economy, knowledge worker, labour market flexibility, low skilled workers, manufacturing employment, market bubble, market design, neoliberal agenda, new economy, pensions crisis, post-industrial society, profit maximization, purchasing power parity, QWERTY keyboard, race to the bottom, Richard Florida, Ronald Reagan, 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

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.

Industry 4.0: The Industrial Internet of Things by Alasdair Gilchrist

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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, 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 skilled workers, millennium bug, pattern recognition, 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, web application, WebRTC, WebSocket, 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

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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, pattern recognition, Pluto: dwarf planet, Richard Feynman, Richard Feynman, shareholder value, Silicon Valley, Skype, smart grid, smart meter, software patent, thinkpad, web application, zero day

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: 98 words: 25,753

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

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4chan, business process, corporate social responsibility, crowdsourcing, en.wikipedia.org, Mahatma Gandhi, Mark Zuckerberg, Netflix Prize, Occupy movement, performance metric, 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.


pages: 525 words: 142,027

CIOs at Work by Ed Yourdon

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8-hour work day, Apple's 1984 Super Bowl advert, business intelligence, business process, call centre, cloud computing, crowdsourcing, distributed generation, 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 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: 339 words: 88,732

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

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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, Baxter: Rethink Robotics, British Empire, business intelligence, business process, call centre, clean water, combinatorial explosion, computer age, computer vision, congestion charging, corporate governance, crowdsourcing, David Ricardo: comparative advantage, 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, game design, global village, happiness index / gross national happiness, illegal immigration, immigration reform, income inequality, income per capita, indoor plumbing, industrial robot, informal economy, inventory management, James Watt: steam engine, Jeff Bezos, jimmy wales, job automation, 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, Mark Zuckerberg, Mars Rover, 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, payday loans, 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.


pages: 996 words: 180,520

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

Amazon: amazon.comamazon.co.ukamazon.deamazon.fr

business process, 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.

The Future of Technology by Tom Standage

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air freight, barriers to entry, business process, business process outsourcing, call centre, Clayton Christensen, computer vision, connected car, corporate governance, disintermediation, distributed generation, double helix, experimental economics, full employment, hydrogen economy, industrial robot, informal economy, interchangeable parts, job satisfaction, labour market flexibility, 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: 540 words: 103,101

Building Microservices by Sam Newman

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airport security, Amazon Web Services, anti-pattern, business process, call centre, continuous integration, create, read, update, delete, defense in depth, Edward Snowden, fault tolerance, index card, information retrieval, Infrastructure as a Service, inventory management, job automation, load shedding, loose coupling, platform as a service, premature optimization, pull request, recommendation engine, social graph, software as a service, the built environment, web application, WebSocket, x509 certificate

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: 204 words: 58,565

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

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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, margin call, Moneyball by Michael Lewis explains big data, 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

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.

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

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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, connected car, corporate social responsibility, crowdsourcing, Elon Musk, financial innovation, global supply chain, income inequality, industrial robot, Internet of things, job satisfaction, Khan Academy, Kickstarter, late fees, Lean Startup, 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, ride hailing / ride sharing, 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, Steve Jobs, supply-chain management, TaskRabbit, The Fortune at the Bottom of the Pyramid, The Nature of the Firm, transaction costs, 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: 302 words: 73,581

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

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3D printing, Airbnb, Amazon Web Services, barriers to entry, bitcoin, blockchain, business process, Clayton Christensen, collaborative economy, crowdsourcing, cryptocurrency, data acquisition, frictionless, game design, hive mind, Internet of things, invisible hand, Kickstarter, Lean Startup, Lyft, M-Pesa, 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, 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.


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

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algorithmic trading, Berlin Wall, bonus culture, BRICs, business process, collapse of Lehman Brothers, collateralized debt obligation, complexity theory, corporate governance, 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, new economy, passive investing, performance metric, risk tolerance, Ronald Reagan, Saturday Night Live, 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

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affirmative action, 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, 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, joint-stock company, knowledge economy, labour market flexibility, land reform, LNG terminal, load shedding, Mahatma Gandhi, market fragmentation, Mikhail Gorbachev, Network effects, new economy, New Urbanism, open economy, 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: 319 words: 89,477

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

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Albert Einstein, Andrew Keen, barriers to entry, Black Swan, business process, call centre, Clayton Christensen, cleantech, cloud computing, corporate governance, Elon Musk, en.wikipedia.org, future of work, game design, George Gilder, Isaac Newton, job satisfaction, knowledge economy, knowledge worker, loose coupling, Louis Pasteur, Malcom McLean invented shipping containers, Maui Hawaii, medical residency, Network effects, packet switching, pattern recognition, 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, 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.


pages: 329 words: 95,309

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

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algorithmic trading, Amazon Web Services, Any sufficiently advanced technology is indistinguishable from magic, augmented reality, bank run, Basel III, bitcoin, business intelligence, business process, business process outsourcing, 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, mobile money, Mohammed Bouazizi, new economy, Northern Rock, Occupy movement, platform as a service, Ponzi scheme, prediction markets, pre–internet, quantitative easing, ransomware, reserve currency, RFID, Satoshi Nakamoto, Silicon Valley, smart cities, software as a service, Steve Jobs, strong AI, Stuxnet, trade route, unbanked and underbanked, underbanked, upwardly mobile, We are the 99%, web application, 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.


pages: 372 words: 89,876

The Connected Company by Dave Gray, Thomas Vander Wal

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A Pattern Language, Albert Einstein, Amazon Mechanical Turk, Amazon Web Services, Atul Gawande, Berlin Wall, business process, call centre, Clayton Christensen, complexity theory, en.wikipedia.org, factory automation, Googley, index card, interchangeable parts, inventory management, Jeff Bezos, Kevin Kelly, loose coupling, market design, minimum viable product, more computing power than Apollo, profit maximization, Richard Florida, 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.

Principles of Protocol Design by Robin Sharp

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accounting loophole / creative accounting, business process, discrete time, fault tolerance, finite state, Gödel, Escher, Bach, information retrieval, loose coupling, packet switching, RFC: Request For Comment, stochastic process, x509 certificate

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: 297 words: 77,362

The Nature of Technology by W. Brian Arthur

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Andrew Wiles, business process, cognitive dissonance, computer age, double helix, Geoffrey West, Santa Fe Institute, haute cuisine, James Watt: steam engine, joint-stock company, Joseph Schumpeter, Kevin Kelly, knowledge economy, locking in a profit, Mars Rover, means of production, 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: 244 words: 76,192

Execution: The Discipline of Getting Things Done by Larry Bossidy

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Albert Einstein, business process, complexity theory, Iridium satellite, Long Term Capital Management, NetJets, 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: 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

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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: 487 words: 151,810

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

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Albert Einstein, asset allocation, Atul Gawande, Bernie Madoff, business process, Cass Sunstein, choice architecture, clean water, 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, loss aversion, medical residency, meta analysis, meta-analysis, Monroe Doctrine, Richard Thaler, risk tolerance, Robert Shiller, Robert Shiller, school vouchers, six sigma, 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.


pages: 494 words: 142,285

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

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AltaVista, Andy Kessler, barriers to entry, business process, Cass Sunstein, computer age, dark matter, disintermediation, 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, linked data, Menlo Park, Network effects, new economy, packet switching, price mechanism, profit maximization, RAND corporation, rent control, rent-seeking, RFC: Request For Comment, Richard Stallman, Richard Thaler, 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

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.


pages: 382 words: 120,064

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

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3D printing, additive manufacturing, 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, 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, London Interbank Offered Rate, M-Pesa, Mark Zuckerberg, mass affluent, microcredit, mobile money, more computing power than Apollo, Northern Rock, Occupy movement, optical character recognition, performance metric, platform as a service, QWERTY keyboard, Ray Kurzweil, recommendation engine, RFID, risk tolerance, self-driving car, Skype, speech recognition, stem cell, telepresence, Tim Cook: Apple, transaction costs, underbanked, 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: 464 words: 127,283

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

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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, 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, Jacquard loom, Jane Jacobs, jitney, John Snow's cholera map, Khan Academy, Kibera, knowledge worker, load shedding, M-Pesa, Mark Zuckerberg, megacity, mobile money, mutually assured destruction, new economy, New Urbanism, Norbert Wiener, Occupy movement, openstreetmap, packet switching, patent troll, 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 Cities: Big Data, Civic Hackers, and the Quest for a New Utopia, 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, 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: 624 words: 127,987

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

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Albert Einstein, Atul Gawande, Black Swan, 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 Ricardo: comparative advantage, Dean Kamen, delayed gratification, discounted cash flows, double entry bookkeeping, Douglas Hofstadter, en.wikipedia.org, Frederick Winslow Taylor, Gödel, Escher, Bach, high net worth, hindsight bias, index card, inventory management, iterative process, job satisfaction, Johann Wolfgang von Goethe, Kevin Kelly, Lao Tzu, loose coupling, loss aversion, 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, 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: 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

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23andMe, 3D printing, Airbnb, Amazon Mechanical Turk, Amazon Web Services, augmented reality, autonomous vehicles, Baxter: Rethink Robotics, bioinformatics, bitcoin, Black Swan, blockchain, Burning Man, business intelligence, business process, call centre, chief data officer, Clayton Christensen, clean water, cloud computing, cognitive bias, collaborative consumption, collaborative economy, corporate social responsibility, cross-subsidies, crowdsourcing, cryptocurrency, dark matter, Dean Kamen, dematerialisation, discounted cash flows, distributed ledger, Edward Snowden, Elon Musk, en.wikipedia.org, ethereum blockchain, Galaxy Zoo, game design, Google Glasses, Google Hangouts, Google X / Alphabet X, gravity well, hiring and firing, Hyperloop, industrial robot, Innovator's Dilemma, Internet of things, Iridium satellite, Isaac Newton, Jeff Bezos, Kevin Kelly, Kickstarter, knowledge worker, Kodak vs Instagram, Law of Accelerating Returns, Lean Startup, life extension, loose coupling, loss aversion, Lyft, Mark Zuckerberg, market design, means of production, minimum viable product, natural language processing, Netflix Prize, Network effects, new economy, Oculus Rift, offshore financial centre, p-value, PageRank, pattern recognition, Paul Graham, 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, Tyler Cowen: Great Stagnation, urban planning, WikiLeaks, winner-take-all economy, X Prize, Y Combinator

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: 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

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British Empire, business process, 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: 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

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3D printing, Affordable Care Act / Obamacare, Airbnb, 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 process, buy low sell high, chief data officer, clean water, cloud computing, connected car, corporate governance, crowdsourcing, data acquisition, data is the new oil, discounted cash flows, disintermediation, Edward Glaeser, Elon Musk, en.wikipedia.org, Erik Brynjolfsson, financial innovation, Haber-Bosch Process, High speed trading, Internet of things, inventory management, invisible hand, Jean Tirole, Jeff Bezos, jimmy wales, Khan Academy, Kickstarter, Lean Startup, Lyft, market design, 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, 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, two-sided market, Uber and Lyft, Uber for X, winner-take-all economy, 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.


pages: 207 words: 63,071

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

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

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: 677 words: 206,548

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

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23andMe, 3D printing, additive manufacturing, Affordable Care Act / Obamacare, Airbnb, airport security, Albert Einstein, algorithmic trading, artificial general intelligence, augmented reality, autonomous vehicles, Baxter: Rethink Robotics, Bill Joy: nanobots, bitcoin, Black Swan, blockchain, borderless world, Brian Krebs, business process, butterfly effect, call centre, 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, Edward Snowden, Elon Musk, Erik Brynjolfsson, Filter Bubble, Firefox, Flash crash, future of work, game design, 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, Internet of things, Jaron Lanier, Jeff Bezos, job automation, John Harrison: Longitude, Jony Ive, Julian Assange, Kevin Kelly, Khan Academy, Kickstarter, knowledge worker, Kuwabatake Sanjuro: assassination market, Law of Accelerating Returns, Lean Startup, license plate recognition, litecoin, M-Pesa, Mark Zuckerberg, Marshall McLuhan, Menlo Park, mobile money, more computing power than Apollo, move fast and break things, Nate Silver, national security letter, natural language processing, obamacare, Occupy movement, Oculus Rift, offshore financial centre, optical character recognition, pattern recognition, 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, 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 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, 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.


pages: 59 words: 15,958

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

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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: 272 words: 64,626

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

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23andMe, Andy Kessler, bank run, barriers to entry, Berlin Wall, British Empire, business process, California gold rush, carbon footprint, Cass Sunstein, cloud computing, collateralized debt obligation, collective bargaining, computer age, disintermediation, 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, 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, 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: 304 words: 82,395

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

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23andMe, Affordable Care Act / Obamacare, airport security, AltaVista, 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, Internet of things, invention of the printing press, Jeff Bezos, 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, performance metric, Peter Thiel, Post-materialism, 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, 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?

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

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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, 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: 93 words: 20,957

Career Essentials: The Cover Letter by Dale Mayer

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business process

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: 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

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Amazon Mechanical Turk, Any sufficiently advanced technology is indistinguishable from magic, autonomous vehicles, business process, call centre, combinatorial explosion, corporate governance, 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, job automation, John Maynard Keynes: technological unemployment, Joseph Schumpeter, Khan Academy, Kickstarter, knowledge worker, labour mobility, Loebner Prize, low skilled workers, minimum wage unemployment, patent troll, pattern recognition, 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!, winner-take-all economy

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: 493 words: 139,845

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

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Albert Einstein, AltaVista, 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, 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

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accounting loophole / creative accounting, Albert Einstein, Asian financial crisis, asset-backed security, Black Swan, Black-Scholes formula, Bretton Woods, BRICs, Brownian motion, business process, buy low sell high, call centre, capital asset pricing model, collateralized debt obligation, complexity theory, corporate governance, Credit Default Swap, credit default swaps / collateralized debt obligations, cuban missile crisis, currency peg, disintermediation, diversification, diversified portfolio, Eugene Fama: efficient market hypothesis, 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, locking in a profit, Long Term Capital Management, mandelbrot fractal, margin call, market bubble, Marshall McLuhan, mass affluent, merger arbitrage, Mexican peso crisis / tequila crisis, moral hazard, mutually assured destruction, 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, risk-adjusted returns, risk/return, shareholder value, short selling, South Sea Bubble, statistical model, technology bubble, the medium is the message, 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: 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

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business intelligence, business process, database schema, Debian, en.wikipedia.org, full text search, 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

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business process, call centre, centre right, citizen journalism, crowdsourcing, demand response, Donald Trump, estate planning, Firefox, knowledge worker, Silicon Valley, skunkworks, 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: 370 words: 112,602

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

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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, 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: 378 words: 110,518

Postcapitalism: A Guide to Our Future by Paul Mason

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Alfred Russel Wallace, bank run, banking crisis, banks create money, Basel III, Bernie Madoff, Bill Gates: Altair 8800, bitcoin, Branko Milanovic, Bretton Woods, BRICs, British Empire, business process, butterfly effect, call centre, capital controls, Claude Shannon: information theory, collaborative economy, collective bargaining, Corn Laws, corporate social responsibility, credit crunch, currency manipulation / currency intervention, currency peg, David Graeber, deglobalization, deindustrialization, deskilling, discovery of the americas, Downton Abbey, 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, Internet of things, job automation, John Maynard Keynes: Economic Possibilities for our Grandchildren, Joseph Schumpeter, Kevin Kelly, knowledge economy, knowledge worker, late capitalism, low skilled workers, market clearing, means of production, Metcalfe's law, 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, payday loans, 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, secular stagnation, sharing economy, Stewart Brand, structural adjustment programs, supply-chain management, the scientific method, The Wealth of Nations by Adam Smith, Transnistria, union organizing, universal basic income, urban decay, urban planning, wages for housework, 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.


pages: 391 words: 97,018

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

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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 process, business process outsourcing, call centre, Carmen Reinhart, clean water, collapse of Lehman Brothers, collateralized debt obligation, 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, illegal immigration, index fund, intermodal, inventory management, Kenneth Rogoff, labor-force participation, LNG terminal, low skilled workers, Mark Zuckerberg, Martin Wolf, Maui Hawaii, McMansion, 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, 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: 379 words: 113,656

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

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Berlin Wall, Bretton Woods, business process, corporate governance, Drosophila, Erdős number, experimental subject, Frank Gehry, Geoffrey West, Santa Fe Institute, invisible hand, Long Term Capital Management, market bubble, Milgram experiment, Murray Gell-Mann, Network effects, new economy, Norbert Wiener, Paul Erdős, rolodex, Ronald Coase, Silicon Valley, supply-chain management, The Nature of the Firm, The Wealth of Nations by Adam Smith, Toyota Production System, transaction costs, transcontinental railway, 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: 366 words: 94,209

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

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3D printing, Airbnb, algorithmic trading, Amazon Mechanical Turk, Andrew Keen, bank run, banking crisis, barriers to entry, bitcoin, blockchain, Burning Man, business process, 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, crowdsourcing, cryptocurrency, disintermediation, diversified portfolio, Elon Musk, Erik Brynjolfsson, 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, Mark Zuckerberg, market bubble, market fundamentalism, Marshall McLuhan, means of production, medical bankruptcy, minimum viable product, 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, trade route, transportation-network company, Turing test, Uber and Lyft, Uber for X, unpaid internship, Y Combinator, young professional, 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.

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

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Ayatollah Khomeini, British Empire, business climate, business process, colonial exploitation, corporate governance, global village, haute cuisine, hiring and firing, invention of writing, Mahatma Gandhi, new economy, oil shale / tar sands, 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: 441 words: 136,954

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

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3D printing, 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, 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, job automation, Kenneth Rogoff, knowledge economy, Lean Startup, low skilled workers, Mark Zuckerberg, market design, 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.


pages: 391 words: 117,984

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

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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, out of africa, Ronald Reagan, sensible shoes, side project, Silicon Valley, Skype, The Fortune at the Bottom of the Pyramid, transaction costs

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: 589 words: 147,053

The Age of Em: Work, Love and Life When Robots Rule the Earth by Robin Hanson

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8-hour work day, artificial general intelligence, augmented reality, Berlin Wall, bitcoin, blockchain, brain emulation, business process, Clayton Christensen, cloud computing, correlation does not imply causation, demographic transition, Erik Brynjolfsson, ethereum blockchain, experimental subject, fault tolerance, financial intermediation, Flynn Effect, hindsight bias, job automation, job satisfaction, Just-in-time delivery, lone genius, Machinery of Freedom by David Friedman, market design, meta analysis, meta-analysis, Nash equilibrium, new economy, prediction markets, rent control, rent-seeking, reversible computing, risk tolerance, Silicon Valley, smart contracts, statistical model, stem cell, Thomas Malthus, trade route, Turing test, Vernor Vinge

As jobs tend to change substantially on roughly the scale of economic doubling times, em speeds are likely to be chosen so that most work careers are likely to last shorter than a few such doubling times. Today, the average age of firms in the S&P500 is 18 years (Foster 2012), which is roughly the doubling time of our world economy. This suggests that the economic doubling time is close to the timescale on which business context changes enough to require big changes in business processes. This is confirmed by the fact that today large firms often attempt to “re-engineer business processes,” that is, to redesign their main business organization and processes from a clean slate. For any given part of a large organization, this process happens roughly every economic doubling time. The re-engineering process is often associated with layoffs and substantial worker retraining. As em training can be much cheaper via making many copies from a single trained em, em organizations are tempted to replace more employees than usual during a re-engineering.

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

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Albert Einstein, barriers to entry, business intelligence, business process, cloud computing, Hans Rosling, Richard Feynman, 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: 197 words: 59,946

The Thank You Economy by Gary Vaynerchuk

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Apple's 1984 Super Bowl advert, augmented reality, business process, call centre, crowdsourcing, en.wikipedia.org, hiring and firing, Jeff Bezos, new economy, pre–internet, Skype, social software, Tony Hsieh

Even if you could take over someone else’s fan base to boost your numbers, those numbers exist only because of the relationship that’s been built, a relationship entirely dependent upon a sustained authentic interaction between brand and customer. Rihanna can’t buy Kanye West’s fans; Blue Bell can’t buy Ben and Jerry’s fans. Amazon can buy Zappos, but it can’t buy Zappos’ fans. Amazon could do what many acquirers do—fold the newly acquired company into the parent company, adapt the Zappos business processes to match their own, take over the Zappos warehouses, suck all the soul out of it and leave nothing intact but the logo. Amazon would have the customers, sure, but it would not have the customer relationships. If Zappos were no longer the Zappos they knew and loved, the customers would abandon ship, and ultimately Amazon would gain nothing from the acquisition. Fortunately, Amazon gets that the key to Zappos’ success is to leave it alone and keep its soul intact, so it will probably reap the benefits it was looking to buy.


pages: 162 words: 50,108

The Little Book of Hedge Funds by Anthony Scaramucci

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Andrei Shleifer, asset allocation, Bernie Madoff, business process, carried interest, 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, Long Term Capital Management, mail merge, margin call, merger arbitrage, 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, too big to fail, transaction costs, Vanguard fund, Y2K, Yogi Berra

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

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Andrew Wiles, Asian financial crisis, Berlin Wall, bonus culture, British Empire, business process, Cass Sunstein, computer age, 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, Long Term Capital Management, Louis Pasteur, market fundamentalism, Nash equilibrium, pattern recognition, purchasing power parity, RAND corporation, regulatory arbitrage, shareholder value, Simon Singh, Steve Jobs, 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: 209 words: 63,649

The Purpose Economy: How Your Desire for Impact, Personal Growth and Community Is Changing the World by Aaron Hurst

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3D printing, Airbnb, Atul Gawande, barriers to entry, big-box store, business process, call centre, carbon footprint, citizen journalism, corporate social responsibility, crowdsourcing, disintermediation, Elon Musk, Firefox, glass ceiling, greed is good, housing crisis, informal economy, Jane Jacobs, jimmy wales, Khan Academy, Kickstarter, Lean Startup, means of production, new economy, pattern recognition, Peter Singer: altruism, Peter Thiel, Ray Oldenburg, remote working, Richard Feynman, Ronald Reagan, sharing economy, Silicon Valley, Silicon Valley startup, Steve Jobs, TaskRabbit, Tony Hsieh, too big to fail, underbanked, women in the workforce, young professional, Zipcar

For years, I’ve worked on building ecosystems of telecommunication companies, funders, governments, and NGOs to create jobs and support families by delivering deep-field, mobile phone-based health care and education systems. Yesterday was spent working through alternative models for public-private partnerships to provide emergency transportation for expecting mothers in remote areas. This afternoon, my team is building a mezzanine of philanthropic and commercial investments to drive economic growth that incorporates smallholder farmers. Tomorrow, we are helping a NGO redesign its internal business processes to more efficiently support external cross-sector collaboration. Next week, we are looking at expansion plans to provide youth support services in sub-Saharan Africa. Harmony: Bentley Davis When I ran the free clinic, we also had a dental clinic. We had a part-time hygienist who took care of cleanings and preventative care, but treatment was harder to find. The longest wait was for dentures.


pages: 196 words: 57,974

Company: A Short History of a Revolutionary Idea by John Micklethwait, Adrian Wooldridge

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affirmative action, barriers to entry, Bonfire of the Vanities, borderless world, business process, Corn Laws, corporate governance, corporate social responsibility, credit crunch, crony capitalism, double entry bookkeeping, Etonian, hiring and firing, invisible hand, James Watt: steam engine, joint-stock company, joint-stock limited liability company, Joseph Schumpeter, knowledge economy, knowledge worker, laissez-faire capitalism, manufacturing employment, market bubble, mittelstand, new economy, North Sea oil, race to the bottom, railway mania, Ronald Coase, Silicon Valley, six sigma, South Sea Bubble, Steve Jobs, Steve Wozniak, strikebreaker, The Nature of the Firm, The Wealth of Nations by Adam Smith, Thorstein Veblen, trade route, transaction costs, tulip mania, wage slave, William Shockley: the traitorous eight

By 2000, McKinsey had four thousand consultants, ten times the number in 1975. Other companies—notably IT firms and accountants—established consulting businesses. The accountants at Arthur Andersen were so jealous of the fees being charged by their colleagues at Andersen Consulting that they tried to invade the business themselves, a move that led to one of the most expensive divorces in corporate history. This was a time when fads such as business-process reengineering sped around the world at a dizzying pace, and when businesspeople rushed to buy books that distilled the management wisdom of Siegfried and Roy, the English rugby captain, Star Trek, and Jesus, CEO. As the company jumped through these hoops, its relationship with the rest of society changed again. By the 1990s, companies had begun to move their headquarters out of city centers.

The Art of Profitability by Adrian Slywotzky

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business process, Indoor air pollution, Isaac Newton, pattern recognition, rolodex, shareholder value

Zhao was wide-eyed. “Really?” “I couldn’t believe it,” Steve affirmed. “But here are some examples. Dell’s inventory turns went from six a year to sixty. Cemex’s response time on customer orders went from 180 minutes to twenty minutes. Oracle’s customer interaction cost went from $350 to twenty bucks. “But 10X productivity isn’t all of it—not by a mile. Digital allows you to literally reverse your business processes, from push to pull and from guess to know.” “What do you mean?” Zhao asked. Steve was starting to get on a roll. “In many cases—not all, but many—becoming digital lets a company’s customers design the product or service they really want to buy. Think 150 THE ART OF PROFITABILITY of Dell’s online configurator, or Herman Miller’s z-axis design system, or Mattel’s My Barbie. The seller creates a dynamic electronic menu, a “Choiceboard,” that lets customers design their own products, picking the exact mix of features they want.”


pages: 229 words: 68,426

Everyware: The Dawning Age of Ubiquitous Computing by Adam Greenfield

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augmented reality, business process, defense in depth, demand response, demographic transition, facts on the ground, game design, Howard Rheingold, Internet of things, James Dyson, knowledge worker, late capitalism, Marshall McLuhan, new economy, Norbert Wiener, packet switching, pattern recognition, profit motive, recommendation engine, RFID, Steve Jobs, technoutopianism, the built environment, the scientific method

Information technology, of course, requires just the opposite: that as much as possible be made as explicit as possible. In programming, for example, software engineers use tools like Object Management Group's Unified Modeling Language (UML) to specify application structure, behavior and architecture with the necessary degree of rigor. (UML and its analogues can also be used to map less technical procedures, e.g., business processes.) Make no mistake about it, "specify" is the operative word here. UML allows programmers to decompose a situation into a use case: a highly granular, stepped, sequential representation of the interaction, with all events and participants precisely defined. Such use cases are a necessary intermediate step between the high-level, natural language description of a scenario and its ultimate expression in code.


pages: 222 words: 74,587

Paper Machines: About Cards & Catalogs, 1548-1929 by Markus Krajewski, Peter Krapp

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business process, double entry bookkeeping, Frederick Winslow Taylor, Gödel, Escher, Bach, index card, Index librorum prohibitorum, information retrieval, invention of movable type, invention of the printing press, Jacques de Vaucanson, Johann Wolfgang von Goethe, Joseph-Marie Jacquard, knowledge worker, means of production, new economy, paper trading, Turing machine

His library supply department will “serve as a guide in selecting the best forms of the various library supplies.”16 The necessary cataloging tools are custom-made and delivered at a discount, “in such a way that they can be used for the catalogues of all libraries.”17 Dewey is convinced that library efficiency can be increased only with uniform cataloging techniques on uniform materials of consistently high quality. In his view, internal business processes in library management and reader service, above all the catalogs, will need to be submitted to strict standardization procedures. With the help of generalized forms, rules, and systematic arrangements for everything from centralized and standardized printing of index cards, to drawers and boxes to fit them in, to inkwells and pens, he begins to “synchronize” libraries. Application of all these innovations is to lead, in Dewey’s vision, to “an immense saving of time.”18 Institutional Technology Transfer 91 Standardization Thus, one of the first projects undertaken by the new American Library Association in January 1877 is a standardization program, with the aim of establishing rules for cataloging processes, catalog entries, and bibliographical norms (in the best tradition, yet without knowledge of the algorithms of the Josephinian project).19 One issue for this bibliographical system is the external appearance of book catalogs, particularly the question of correct measurements for a Standard Catalogue Card.20 As secretary and host of the meetings of the Co-operation Committee, Dewey invests less into originality than into realizing his reform principle of optimization.


pages: 201 words: 64,545

Let My People Go Surfing by Yvon Chouinard

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air freight, business process, clean water, Donald Trump, Doomsday Book, Mahatma Gandhi, pushing on a string, Ralph Waldo Emerson, urban sprawl

We are a member of the Fair Labor Association, we talk with other companies about their practices, and we ask our factories—and workers—to tell us what kind of help they most need. Most important, we’ve tried to teach everyone we work with to think the way we do: that the whole supply chain has to be a functioning, interconnected system. Borrow Ideas from Other Disciplines Because the world is changing, we can never assume that the way we have done things in the past is adequate for the future. We constantly evaluate the ideas of the moment for improving business processes—from MRP (materials resources plan), to just-in-time, to quick response, to self-managed teams, if we think these approaches may result in a better product delivered on time and at a reasonable cost. The drive for quality in production in any organization has to go beyond the products themselves. It extends to how we organize ourselves to get a body of work done, how we beg, borrow, and steal good ideas from other companies and cultures, and how we approach the question of the way things are and how they should be.


pages: 265 words: 74,000

The Numerati by Stephen Baker

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Berlin Wall, Black Swan, business process, call centre, correlation does not imply causation, Drosophila, full employment, illegal immigration, index card, Isaac Newton, job automation, job satisfaction, McMansion, natural language processing, PageRank, personalized medicine, recommendation engine, RFID, Silicon Valley, Skype, statistical model, Watson beat the top human players on Jeopardy!

Journalists who wanted to hear Palmisano's announcement grumbled about this venue for weeks. They had to sign up for Second Life and attend as their own avatars. By staking IBM's blue flag in a simulated world, Palmisano was pointing to the company's future. Already, engineers around the world use computer simulations to design electric turbines and fine-tune the traffic flows in major cities. The way IBM sees it, entire business processes will one day be simulated. Picture managers, their fists grasping joysticks, trying out new industrial approaches and calibrating operations as if they were running their own version of the video game The Sims. If Takriti and his team master their next assignment, the avatars on the screen will be the mathematical models of IBM's workers. This process is just beginning, and Takriti already waxes nostalgic for the old days, when it was machines that were modeled.


pages: 238 words: 73,824

Makers by Chris Anderson

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3D printing, Airbnb, Any sufficiently advanced technology is indistinguishable from magic, Apple II, autonomous vehicles, barriers to entry, Buckminster Fuller, Build a better mousetrap, business process, crowdsourcing, dark matter, David Ricardo: comparative advantage, death of newspapers, dematerialisation, Elon Musk, factory automation, Firefox, future of work, global supply chain, global village, industrial robot, interchangeable parts, Internet of things, inventory management, James Hargreaves, James Watt: steam engine, Jeff Bezos, job automation, Joseph Schumpeter, Kickstarter, Lean Startup, manufacturing employment, Mark Zuckerberg, means of production, Menlo Park, Network effects, profit maximization, race to the bottom, Richard Feynman, Richard Feynman, Ronald Coase, self-driving car, side project, Silicon Valley, Silicon Valley startup, Skype, slashdot, South of Market, San Francisco, spinning jenny, Startup school, stem cell, Steve Jobs, Steve Wozniak, Steven Levy, Stewart Brand, supply-chain management, The Nature of the Firm, The Wealth of Nations by Adam Smith, transaction costs, trickle-down economics, Whole Earth Catalog, X Prize, Y Combinator

This is the way all successful technological revolutions work. The Gartner Group describes this boom-bust-boom trajectory as the “Hype Cycle” of tech-driven change. After the “Peak of Inflated Expectations,” there is the “Trough of Disillusionment.” Then comes the “Slope of Enlightenment,” and finally the “Plateau of Productivity.” We’ve been through the first three already. Now we’re enjoying the last. By the time a business process is too boring to comment on, it’s probably starting to actually work. So while the rest of us are having our heads turned by the latest buzzy social media thing, sites like MFG.com are quietly going about their work of turbocharging the world’s real economic engine, making stuff faster, cheaper, better. Open Sesame In 1999, while I was working in Hong Kong as The Economist’s Asia Business editor, one of the first people I met was a hyperkinetic wisp of a man named Jack Ma, who wanted my advice on a new Web company he was setting up.

Exploring Everyday Things with R and Ruby by Sau Sheong Chang

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Alfred Russel Wallace, bioinformatics, business process, butterfly effect, cloud computing, Craig Reynolds: boids flock, Debian, Edward Lorenz: Chaos theory, Gini coefficient, income inequality, invisible hand, p-value, price stability, Skype, statistical model, stem cell, Stephen Hawking, text mining, The Wealth of Nations by Adam Smith, We are the 99%, web application, wikimedia commons

At least not for most people, anyway. The exceptions are scientists and mathematicians, who long ago pounced on the tools that enable them to do their work much more efficiently. If you’re someone from these two camps, you are likely already taking full advantage of the power of computers. However, for programmers and many other people, writing computer programs started with providing tools for businesses and for improving business processes. It’s all about using computers to reduce cost, increase revenue, and improve efficiency. For many professional programmers, coding is a job. It’s drudgery, low-level menial work that brings food to the table. We have forgotten the promise of computers and the power of programming for discovery. Bringing the World to Us This book is an attempt to bring back that wonder and sense of discovery.


pages: 200 words: 72,182

Nickel and Dimed: On (Not) Getting by in America by Barbara Ehrenreich

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business process, full employment, housing crisis, income inequality, McMansion, place-making, telemarketer, union organizing, wage slave, women in the workforce, working poor, zero day

And then it happens—a magical flow state in which the clothes start putting themselves away. Oh, I play a part in this, but not in any conscious way. Instead of thinking, “White Stag navy twill skort,” and doggedly searching out similar skorts, all I have to do is form an image of the item in my mind, transpose this image onto the visual field, and move to wherever the image finds its match in the outer world. I don't know how this works. Maybe my mind just gets so busy processing the incoming visual data that it has to bypass the left brain's verbal centers, with their cumbersome instructions: “Proceed to White Stag area in the northwest corner of ladies', try bottom racks near khaki shorts. . . ” Or maybe the trick lies in understanding that each item wants to be reunited with its sibs and its clan members and that, within each clan, the item wants to occupy its proper place in the color/size hierarchy.


pages: 296 words: 78,227

The 80/20 Principle: The Secret to Achieving More With Less by Richard Koch

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Albert Einstein, barriers to entry, business process, delayed gratification, fear of failure, income inequality, inventory management, Johann Wolfgang von Goethe, knowledge worker, profit maximization, rolodex, Ronald Reagan, wage slave

Recardo asks: Which gaps adversely affect your most strategic consumers? As with many other quality problems, Pareto’s Law prevails here too: if you remedy the most critical 20 percent of your quality gaps, you will realize 80 percent of the benefits. This first 80 percent typically includes your breakthrough improvements.2 Another writer, focusing on corporate turnarounds, comments: For every step in your business process, ask yourself if it adds value or provides essential support. If it does neither, it’s waste. Cut it. [This is] the 80/20 rule, revisited: You can eliminate 80 percent of the waste by spending only 20 percent of what it would cost you to get rid of 100 percent of the waste. Go for the quick gain now.3 The 80/20 Principle was also used by Ford Electronics Manufacturing Corporation in a quality program that won the Shingo prize: Just-in-time programs have been applied using the 80/20 rule (80 percent of the value is spread over 20 percent of the volume) and top-dollar usages are analyzed constantly.


pages: 238 words: 77,730

Final Jeopardy: Man vs. Machine and the Quest to Know Everything by Stephen Baker

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23andMe, AI winter, Albert Einstein, artificial general intelligence, business process, call centre, clean water, computer age, Frank Gehry, information retrieval, Iridium satellite, Isaac Newton, job automation, pattern recognition, Ray Kurzweil, Silicon Valley, Silicon Valley startup, statistical model, theory of mind, thinkpad, Turing test, Vernor Vinge, Wall-E, Watson beat the top human players on Jeopardy!

Chris Bailey, the chief information officer at SAS, a major producer of analytics software, says the focus is on speed. “Our goal is to make the systems run a thousand or a million times faster,” he said. “That enables us to look at a million times more input.” With this speed, companies increasingly will be able to carry out research, and even run simulations, while the customer is paying for a prescription or withdrawing funds. Computers with speed and natural language are poised to transform business processes, perhaps entire industries. Compared to what’s ahead, even today’s state of the art looks sluggish. Consider this snapshot of the data economy, circa 2011: A man walks into a pharmacy to renew his blood pressure medication. He picks up some toiletries while he’s there. He hands the cashier his customer loyalty card, which lowers his bill by a dollar or two, and then pays with his Visa card.


pages: 288 words: 66,996

Travel While You Work: The Ultimate Guide to Running a Business From Anywhere by Mish Slade

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Airbnb, Atul Gawande, business process, Checklist Manifesto, cloud computing, crowdsourcing, Firefox, Google Chrome, Google Hangouts, Inbox Zero, job automation, Lyft, remote working, side project, Skype, speech recognition

I'll be the first to admit: I don't and can't do this. I check my emails while putting my contact lenses in and brushing my teeth in the morning. But Rob has this down to a fine art, and it really does help him stay focused in the morning: it means other people's priorities don't get in the way of his #1 priority – whether it's writing a book, recording a podcast, planning a webinar or mapping out a business process. Prevent distracting and non-urgent emails from entering your inbox. Unsubscribe from EVERY mailing list you find yourself on but never read. This is easier done than said! All you have to do is visit Unroll Me (www.worktravel.co/unroll) and they can handle it all for you. Sign up for new lists using the Gmail "plus sign" trick (more here: www.worktravel.co/plustrick). Then filter anything sent to that address to skip the inbox, get marked as "read", and be given a "mailing list" label so you can schedule a specific time to read them.


pages: 239 words: 64,812

Geek Sublime: The Beauty of Code, the Code of Beauty by Vikram Chandra

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Alan Turing: On Computable Numbers, with an Application to the Entscheidungsproblem, Apple II, barriers to entry, Berlin Wall, British Empire, business process, conceptual framework, create, read, update, delete, crowdsourcing, East Village, European colonialism, finite state, Firefox, Flash crash, glass ceiling, Grace Hopper, haute couture, iterative process, Jaron Lanier, John von Neumann, land reform, London Whale, Paul Graham, pink-collar, revision control, Silicon Valley, Silicon Valley ideology, Skype, Steve Jobs, Steve Wozniak, theory of mind, Therac-25, Turing machine, wikimedia commons, women in the workforce

A 1959 Price Waterhouse report warned that “high quality individuals are the key to top grade programming. Why? Purely and simply because much of the work involved is exacting and difficult enough to require real intellectual ability and above average personal characteristics.”20 Such individuals weren’t easy to find, and as corporations looked for competitive advantage by computerizing their business processes, a shortage resulted. Corporations set up training programmes, fly-by-night vocational schools sprang up guaranteeing jobs: “There’s room for everyone. The industry needs people. You’ve got what it takes.”21 In 1967, Cosmopolitan magazine carried an article titled “The Computer Girls” that emphasized that programming was a field in which there was “no sex discrimination in hiring”—“every company that makes or uses computers hires women to program them … If a girl is qualified, she’s got the job.”


pages: 224 words: 48,804

The Productive Programmer by Neal Ford

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anti-pattern, business process, c2.com, continuous integration, database schema, domain-specific language, Firefox, general-purpose programming language, knowledge worker, side project, type inference, web application, William of Occam

It combines engineering and craft in highly coupled ways, requiring good developers to exhibit a wide variety of skills: analytical thinking; extreme attention to detail on multiple levels and aesthetics; an awareness of macro and micro level concerns simultaneously; and a keen, fine-grained understanding of the subject matter we’re writing software to assist. Ironically, developers have to understand business processes at a much lower level than the actual practitioners of the business. Business people can use their experience to make on-the-fly decisions when novel situations pop up; we must encode everything in algorithms and explicit behavior. The original vision for The Productive Programmer was to provide a long list of recipes for productivity. It morphed into a two-part book, where the first part deals with the mechanics of productivity and the second concentrates on the practices of productivity as a developer.

Rethinking Money: How New Currencies Turn Scarcity Into Prosperity by Bernard Lietaer, Jacqui Dunne

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3D printing, agricultural Revolution, Albert Einstein, Asian financial crisis, banking crisis, Berlin Wall, BRICs, business climate, business process, butterfly effect, carbon footprint, Carmen Reinhart, clockwork universe, collapse of Lehman Brothers, complexity theory, conceptual framework, credit crunch, discounted cash flows, en.wikipedia.org, Fall of the Berlin Wall, fear of failure, fiat currency, financial innovation, Fractional reserve banking, full employment, German hyperinflation, happiness index / gross national happiness, job satisfaction, Marshall McLuhan, microcredit, mobile money, money: store of value / unit of account / medium of exchange, more computing power than Apollo, new economy, Occupy movement, price stability, reserve currency, Silicon Valley, the payments system, too big to fail, transaction costs, trickle-down economics, urban decay, War on Poverty, working poor

This may sound grandiose, but actually the metaphor seems valid. Around 1990, computers started to talk to each other, and all kinds of connections started to happen. The individual machines—servers—are like neurons, and the axons and synapses are the communication pathways and linkages that enable them to be in conversation with each other and to take appropriate action. So, we can say that another economy—a second economy—of all of these digitized business processes conversing, executing, and triggering further actions is silently forming alongside the physical economy.” 4 The upshot of this second economy is that while it’s an engine of growth and prosperity, it does not provide jobs. In fact, it erodes entire sectors of traditional jobs. Much of the job creation that has taken place over the past 20 years has been in small enterprises. Businesses with fewer than 100 employees provided the largest percentage of gross job gains, almost 60 percent.5 Additionally, entirely new job categories have surfaced that didn’t exist a decade ago.


pages: 496 words: 174,084

Masterminds of Programming: Conversations With the Creators of Major Programming Languages by Federico Biancuzzi, Shane Warden

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business intelligence, business process, cellular automata, cloud computing, complexity theory, conceptual framework, continuous integration, data acquisition, domain-specific language, Douglas Hofstadter, Fellow of the Royal Society, finite state, Firefox, follow your passion, Frank Gehry, general-purpose programming language, HyperCard, information retrieval, iterative process, John von Neumann, linear programming, loose coupling, Mars Rover, millennium bug, NP-complete, Paul Graham, performance metric, QWERTY keyboard, RAND corporation, randomized controlled trial, Renaissance Technologies, Silicon Valley, slashdot, software as a service, software patent, sorting algorithm, Steve Jobs, traveling salesman, Turing complete, type inference, Valgrind, Von Neumann architecture, web application

You need to have more precise terms as an alternative. On a big project that I’ve been involved in we have imposed a requirements tax. If anybody uses the word “requirements” standalone, they have to add $2.00 to the entertainment fund. If they want to talk about use cases, or if they want to talk about story cards, or they want to talk about performance metrics, or they want to talk about business cases or business process models, those are all acceptable terms. They don’t incur a tax, because now if you say, “I need to have the use cases or the functional specification, or a mockup of the application that needs to be developed,” that’s a precise request. I see projects getting into trouble when they don’t get that part right. Writing the code doesn’t seem like the hard part anymore. The hard part is figuring out what the code should be doing.

But again, we couldn’t have known that…we built these first systems; we couldn’t have known that’s where the most volatile pieces would be, and that’s some of the changes that are going on right now in that space. Is that open for visualization? You bet. We see the opportunity for being able to find new languages to express business rules. My personal opinion is the UML was quite sufficient and we saw some interesting political things happening that led to BPEL (Business Process Execution Language) coming out as a very separate thing from the UML. Microsoft might argue that M is an attempt to do that. Grady: Absolutely, which goes back to the point I raised earlier: will M be successful? The marketplace will decide. People might not even realize they want a separate layer for business rules. Grady: Absolutely. There’s a delightful paper written by researchers at IBM called “The Diary of a Datum.”[30] We keep adding these layers that perhaps to some degree help us as humans reason about and visualize these systems, but ultimately in the executability of our systems we’re adding incredible layers.


pages: 602 words: 177,874

Thank You for Being Late: An Optimist's Guide to Thriving in the Age of Accelerations by Thomas L. Friedman

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3D printing, additive manufacturing, affirmative action, Airbnb, AltaVista, Amazon Web Services, autonomous vehicles, Ayatollah Khomeini, barriers to entry, Berlin Wall, Bernie Sanders, bitcoin, blockchain, business process, call centre, centre right, Clayton Christensen, clean water, cloud computing, corporate social responsibility, crowdsourcing, David Brooks, demand response, demographic dividend, demographic transition, Deng Xiaoping, Donald Trump, Erik Brynjolfsson, failed state, Fall of the Berlin Wall, Ferguson, Missouri, first square of the chessboard / second half of the chessboard, Flash crash, game design, gig economy, global supply chain, illegal immigration, immigration reform, income inequality, indoor plumbing, Internet of things, invention of the steam engine, inventory management, Jeff Bezos, job automation, John von Neumann, Khan Academy, Kickstarter, knowledge economy, knowledge worker, land tenure, linear programming, low skilled workers, Lyft, Mark Zuckerberg, Maui Hawaii, Menlo Park, Mikhail Gorbachev, mutually assured destruction, pattern recognition, planetary scale, pull request, Ralph Waldo Emerson, ransomware, Ray Kurzweil, Richard Florida, ride hailing / ride sharing, Robert Gordon, Ronald Reagan, Second Machine Age, self-driving car, shareholder value, sharing economy, Silicon Valley, Skype, smart cities, South China Sea, Steve Jobs, TaskRabbit, Thomas L Friedman, transaction costs, Transnistria, urban decay, urban planning, Watson beat the top human players on Jeopardy!, WikiLeaks, women in the workforce, Y2K, Yogi Berra

As we transition from an industrial-age economy to a computer-Internet-mobile-broadband-driven economy—that is, a supernova-driven economy—we are experiencing the growing pains of adjusting. Both managers and workers are having to absorb these new technologies—not just how they work but how factories and business processes and government regulations all need to be redesigned around them. The same thing, notes Brynjolfsson, happened 120 years ago, in the Second Industrial Revolution, when electrification—the supernova of its day—was introduced. Old factories did not just have to be electrified to achieve the productivity boosts; they had to be redesigned, along with all business processes. It took thirty years for one generation of managers and workers to retire and for a new generation to emerge to get the full productivity benefits of that new power source. A December 2015 study by the McKinsey Global Institute on American industry found a “considerable gap between the most digitized sectors and the rest of the economy over time and [found] that despite a massive rush of adoption, most sectors have barely closed that gap over the past decade … Because the less digitized sectors are some of the largest in terms of GDP contribution and employment, we [found] that the US economy as a whole is only reaching 18 percent of its digital potential … The United States will need to adapt its institutions and training pathways to help workers acquire relevant skills and navigate this period of transition and churn.”


pages: 268 words: 112,708

Culture works: the political economy of culture by Richard Maxwell

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1960s counterculture, AltaVista, Apple's 1984 Super Bowl advert, barriers to entry, Berlin Wall, big-box store, business process, corporate governance, cuban missile crisis, deindustrialization, Fall of the Berlin Wall, Francis Fukuyama: the end of history, global village, Howard Rheingold, income inequality, informal economy, intermodal, late capitalism, Marshall McLuhan, medical malpractice, Network effects, profit maximization, Ralph Nader, refrigerator car, Ronald Reagan, Silicon Valley, structural adjustment programs, talking drums, telemarketer, the built environment, Thorstein Veblen, Unsafe at Any Speed, urban renewal, Victor Gruen, Whole Earth Catalog, women in the workforce

In this sense, advertising impedes competition in the market. In sum, the very nature of modern advertising suggests that it will always have problems convincing the public of its inherent worth. Advertising and the Consumer By World War I, national manufacturers had become increasingly dependent on advertising to secure “brand loyalty” in order to sell their products. This elevated advertising’s role within the larger business process and several advertising interest organizations began to appear. The Associated Advertising Clubs of the World (AACW), with local advertising clubs as its members, was formed in 1914. The American Association of Advertising Agencies (AAAA or 4As), a group consisting of large advertising agencies closely connected with national advertising, followed suit in 1917. Two years earlier, the business community witnessed the start of the Association of National Advertisers (ANA), originally formed in 1911 as the Association of National Advertising Managers.


pages: 509 words: 92,141

The Pragmatic Programmer by Andrew Hunt, Dave Thomas

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A Pattern Language, Broken windows theory, business process, buy low sell high, c2.com, combinatorial explosion, continuous integration, database schema, domain-specific language, general-purpose programming language, Grace Hopper, if you see hoof prints, think horses—not zebras, index card, loose coupling, Menlo Park, MVC pattern, premature optimization, Ralph Waldo Emerson, revision control, Schrödinger's Cat, slashdot, sorting algorithm, speech recognition, traveling salesman, urban decay, Y2K

But it wasn't the programmers' doing, and it wasn't really a memory usage issue. If anything, it was the system analysts' and designers' fault. The Y2K problem came about from two main causes: a failure to see beyond current business practice, and a violation of the DRY principle. Businesses were using the two-digit shortcut long before computers came on the scene. It was common practice. The earliest data processing applications merely automated existing business processes, and simply repeated the mistake. Even if the architecture required two-digit years for data input, reporting, and storage, there should have been an abstraction of a DATE that "knew" the two digits were an abbreviated form of the real date. Tip 53 Abstractions Live Longer than Details Does "seeing further" require you to predict the future? No. It means generating statements such as The system makes active use of an abstraction of DATEs.


pages: 299 words: 91,839

What Would Google Do? by Jeff Jarvis

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23andMe, Amazon Mechanical Turk, Amazon Web Services, Anne Wojcicki, barriers to entry, Berlin Wall, business process, call centre, cashless society, citizen journalism, clean water, connected car, credit crunch, crowdsourcing, death of newspapers, disintermediation, diversified portfolio, don't be evil, fear of failure, Firefox, future of journalism, Google Earth, Googley, Howard Rheingold, informal economy, inventory management, Jeff Bezos, jimmy wales, Kevin Kelly, Mark Zuckerberg, moral hazard, Network effects, new economy, Nicholas Carr, PageRank, peer-to-peer lending, post scarcity, prediction markets, pre–internet, Ronald Coase, search inside the book, Silicon Valley, Skype, social graph, social software, social web, spectrum auction, speech recognition, Steve Jobs, the medium is the message, The Nature of the Firm, the payments system, The Wisdom of Crowds, transaction costs, web of trust, Y Combinator, Zipcar

Other ideas take off (such as giving free birthday brews, which Starbucks then considered). Bruzzo said it is vital for the company to “close that loop in an authentic way and show the commitment on the part of Starbucks to respond to what we’ve heard, which is about putting those ideas in action or building those ideas together with customers.” In short: “We’re truly going to adopt it into our business process, into product development, experience development, and store design.” To do that, he assigned 48 “idea partners” from all over the company to enter the discussion with customers, using the forum as a laboratory. They were to become champions for ideas back in their departments “so that literally customers would have a seat at the table when product decisions are made.” Starbucks, like Dell, has a parallel version of the platform running behind its wall for employees to share and discuss their own suggestions.


pages: 302 words: 86,614

The Alpha Masters: Unlocking the Genius of the World's Top Hedge Funds by Maneet Ahuja, Myron Scholes, Mohamed El-Erian

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Asian financial crisis, asset allocation, asset-backed security, backtesting, Bernie Madoff, Bretton Woods, business process, call centre, collapse of Lehman Brothers, collateralized debt obligation, corporate governance, credit crunch, Credit Default Swap, credit default swaps / collateralized debt obligations, diversification, Donald Trump, en.wikipedia.org, family office, fixed income, high net worth, interest rate derivative, Isaac Newton, Long Term Capital Management, Mark Zuckerberg, merger arbitrage, NetJets, oil shock, pattern recognition, Ponzi scheme, quantitative easing, quantitative trading / quantitative finance, Renaissance Technologies, risk-adjusted returns, risk/return, rolodex, short selling, Silicon Valley, South Sea Bubble, statistical model, Steve Jobs, systematic trading

But I’ve never seen anyone with that approach really make it as an investor. The great hedge fund managers, guys like Bill Ackman, David Einhorn, David Tepper, Kyle Bass, and Alan Fournier, are super-passionate. If you aren’t going to match them, don’t bother.” Second, while you’re being passionate about investing, don’t forget about running your business. “Make sure you spend enough time, maybe 20 percent of your time, thinking about your business process in your organization,” advised Loeb. “Ask yourself, what kind of culture do you want? What are you going to look for in hiring people? How do you want to organize yourself? How are you going to pay your team? How are you going to measure and reward performance? You will have to answer all of these questions eventually. Better to answer them in an intelligent considered way than as an afterthought.”


pages: 392 words: 104,760

Babel No More: The Search for the World's Most Extraordinary Language Learners by Michael Erard

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Asperger Syndrome, business process, business process outsourcing, call centre, complexity theory, European colonialism, pattern recognition, Skype, Steven Pinker, theory of mind

“A lot of Indians can’t understand other Indians in English, because each region has its own accent.” One example: the English word zoo. Because Indian languages don’t have the z, the word is pronounced “soo” (in the south) or “joo” (in the north). This sort of native inflection can keep people from getting jobs in the booming call-center industry in Hyderabad and Bangalore, two huge, bustling cities that are home to high-tech companies and the “business process outsourcing” industry. Eapen’s school was one of dozens teaching the “soft skills”: team building, negotiation, and English pronunciation. Students were paying him 6,000 rupees (about $126 US) to help them neutralize their accents in English; he himself has a crisp British accent, which he honed working in Kuwait and Dubai. The courses last for three months, five days a week, two hours a day.


pages: 292 words: 81,699

More Joel on Software by Joel Spolsky

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barriers to entry, Black Swan, Build a better mousetrap, business process, call centre, Danny Hillis, failed state, Firefox, George Gilder, low cost carrier, Mars Rover, Network effects, Paul Graham, performance metric, place-making, price discrimination, prisoner's dilemma, Ray Oldenburg, Sand Hill Road, Silicon Valley, slashdot, social software, Steve Ballmer, Steve Jobs, Superbowl ad, The Great Good Place, type inference, unpaid internship, wage slave, web application, Y Combinator

But I keep hearing that enrollment in CS departments is dropping perilously, and one reason I hear for it is “Students are afraid to go into a field where all the jobs are going to India.” That’s so wrong for so many reasons. First, trying to choose a career based on a current business fad is foolish. Second, programming is incredibly good training for all kinds of fabulously interesting jobs, such as business process engineering, even if every single programming job does go to India and China. Third, and trust me on this, there’s still an incredible shortage of the really good programmers, here and in India. Yes, there are a bunch of out-of-work IT people making a lot of noise about how long they’ve been out of work, but you know what? At the risk of pissing them off, really good programmers do have jobs.


pages: 422 words: 113,525

Whole Earth Discipline: An Ecopragmatist Manifesto by Stewart Brand

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agricultural Revolution, back-to-the-land, biofilm, borderless world, Buckminster Fuller, business process, Cass Sunstein, clean water, Community Supported Agriculture, conceptual framework, Danny Hillis, dark matter, decarbonisation, demographic dividend, demographic transition, Elon Musk, Exxon Valdez, failed state, Geoffrey West, Santa Fe Institute, glass ceiling, Google Earth, Hans Rosling, Hernando de Soto, informal economy, interchangeable parts, invention of agriculture, invention of the steam engine, Jane Jacobs, jimmy wales, Kevin Kelly, Kibera, land tenure, M-Pesa, Marshall McLuhan, megacity, microbiome, New Urbanism, out of africa, Paul Graham, peak oil, Richard Florida, Ronald Reagan, Silicon Valley, smart grid, stem cell, Stewart Brand, The Fortune at the Bottom of the Pyramid, Thomas Malthus, University of East Anglia, uranium enrichment, urban renewal, Whole Earth Catalog, Whole Earth Review, working-age population, Y2K

Because remanufactured cellphones cost $10 in the developing world and incoming messages are free, every stratum of society is connected. Day laborers, for instance, no longer hang around a street corner waiting to be picked for work. Instead, job offers arrive by SMS from a computerized clearing house. The International Telecommunications Union estimates that in the poorest countries each additional cellphone installed adds $3,000 to the GDP, primarily due to the increased efficiency of business processes. The great monetizer is prepaid SIM (Subscriber Identity Module) cards—a business worth $3 billion across Africa in 2007, run by local entrepreneurs. SIM cards are sold at vegetable stands and the like, along with “scratch cards” that reload the SIM with additional minutes. Some people carry just a card and borrow a phone when needed. Safaricom, in Kenya, has a service called M-Pesa that lets the cell work as an ATM; to send someone money, you text-message the appropriate code to them, and they get cash from a local M-Pesa agent.


pages: 349 words: 114,038

Culture & Empire: Digital Revolution by Pieter Hintjens

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4chan, airport security, anti-communist, anti-pattern, barriers to entry, Bill Duvall, bitcoin, blockchain, business climate, business intelligence, business process, Chelsea Manning, clean water, congestion charging, Corn Laws, correlation does not imply causation, cryptocurrency, Debian, Edward Snowden, failed state, financial independence, Firefox, full text search, German hyperinflation, global village, GnuPG, Google Chrome, greed is good, Hernando de Soto, hiring and firing, informal economy, invisible hand, James Watt: steam engine, Jeff Rulifson, Julian Assange, Kickstarter, M-Pesa, mutually assured destruction, Naomi Klein, national security letter, new economy, New Urbanism, Occupy movement, offshore financial centre, packet switching, patent troll, peak oil, pre–internet, private military company, race to the bottom, rent-seeking, reserve currency, RFC: Request For Comment, Richard Feynman, Richard Feynman, Richard Stallman, Satoshi Nakamoto, security theater, Skype, slashdot, software patent, spectrum auction, Steve Crocker, Steve Jobs, Steven Pinker, Stuxnet, The Wealth of Nations by Adam Smith, The Wisdom of Crowds, trade route, transaction costs, union organizing, web application, WikiLeaks, Y2K, zero day, Zipf's Law

Some musician friends, invariably poor like every musician I ever met, explained that they had to pay collection society fees when they played a concert of their own original music. They could otherwise have stayed off the radar, signed no contracts, sold no CDs in the high street shops, played no concerts in the big venues. The music industry made, and still largely makes, its profits by controlling the whole business process from raw artist to final user experience, allowing no real competition at any point along this chain. They gouge the artists so badly you would think by now no artist would even talk to them. Yet, there are always more young eager faces waiting in line. Artists seem to scramble over each other to be exploited. Just as the diamond industry keeps its prices high by stockpiling rough stones that it never sells, the music industry signs artists simply so they cannot play on the free market.


pages: 354 words: 26,550

High-Frequency Trading: A Practical Guide to Algorithmic Strategies and Trading Systems by Irene Aldridge

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algorithmic trading, asset allocation, asset-backed security, automated trading system, backtesting, Black Swan, Brownian motion, business process, capital asset pricing model, centralized clearinghouse, collapse of Lehman Brothers, collateralized debt obligation, collective bargaining, diversification, equity premium, fault tolerance, financial intermediation, fixed income, high net worth, implied volatility, index arbitrage, interest rate swap, inventory management, law of one price, Long Term Capital Management, Louis Bachelier, margin call, market friction, market microstructure, martingale, New Journalism, p-value, paper trading, performance metric, profit motive, purchasing power parity, quantitative trading / quantitative finance, random walk, Renaissance Technologies, risk tolerance, risk-adjusted returns, risk/return, Sharpe ratio, short selling, Small Order Execution System, statistical arbitrage, statistical model, stochastic process, stochastic volatility, systematic trading, trade route, transaction costs, value at risk, yield curve

For example, the addition of new trading strategies into the trading portfolio should undergo rigid product review processes that analyze the return and risk profiles and other profitability and risk factors of proposed capital allocations, as described in Chapter 5. In addition to detailed process Risk Management 271 guidelines, operational risk can be hedged with insurance contracts offered by specialty insurance firms and by entirely outsourcing noncritical business processes to third-party vendors. Legal risk is most effectively managed via the causal analysis used for its measurement. The key risk indicators are continuously monitored, and the effect of their changes is assessed according to the causal framework developed in the estimation of legal risk. CONCLUSION This chapter has examined the best practices in risk management followed by successful high-frequency operations.


pages: 223 words: 10,010

The Cost of Inequality: Why Economic Equality Is Essential for Recovery by Stewart Lansley

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banking crisis, Basel III, Big bang: deregulation of the City of London, Bonfire of the Vanities, borderless world, Branko Milanovic, Bretton Woods, British Empire, business process, call centre, capital controls, collective bargaining, corporate governance, correlation does not imply causation, credit crunch, Credit Default Swap, crony capitalism, David Ricardo: comparative advantage, deindustrialization, Edward Glaeser, falling living standards, financial deregulation, financial innovation, Financial Instability Hypothesis, floating exchange rates, full employment, Goldman Sachs: Vampire Squid, high net worth, hiring and firing, Hyman Minsky, income inequality, James Dyson, Jeff Bezos, job automation, Joseph Schumpeter, Kenneth Rogoff, knowledge economy, laissez-faire capitalism, Long Term Capital Management, low skilled workers, manufacturing employment, market bubble, Martin Wolf, mittelstand, mobile money, Mont Pelerin Society, new economy, Nick Leeson, North Sea oil, Northern Rock, offshore financial centre, oil shock, Plutocrats, plutocrats, Plutonomy: Buying Luxury, Explaining Global Imbalances, rising living standards, Robert Shiller, Robert Shiller, Ronald Reagan, savings glut, shareholder value, The Great Moderation, The Spirit Level, The Wealth of Nations by Adam Smith, Thomas Malthus, too big to fail, Tyler Cowen: Great Stagnation, Washington Consensus, Winter of Discontent, working-age population

Certainly, some of the personal wealth boom of the last two decades is down to exceptional wealth and job-creating entrepreneurial activity which has added to productive capacity. The founders of Facebook, Google and Yahoo have presided over a profound and entirely positive business and social revolution. Some venture capitalist companies have a strong record in encouraging the formation of new products and services. There are thousands of successful modern entrepreneurs who have become rich by founding new companies, inventing new products or improving business processes. They include the British inventor and engineer, James Dyson, the owner of the Swedish global Ikea chain, Ingvar Kamprad, and Tim Waterstone who modernised bookselling in the UK by setting up his national book chain using a £1000 redundancy cheque from WH Smiths. Each of these has become rich by creating new wealth, business and jobs. They are a group that have rightly been defined as ‘the deserving rich’, a group ‘who deserve their hard-earned places, those who, through a mix of exceptional skill, effort and risktaking, have contributed to increasing the size of the cake by creating new wealth and in ways which benefit others as well as themselves.


pages: 360 words: 110,929

Saturn's Children by Stross, Charles

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augmented reality, British Empire, business process, gravity well, indoor plumbing, invisible hand, Isaac Newton, Kuiper Belt, loose coupling, phenotype, Pluto: dwarf planet, Plutocrats, plutocrats, theory of mind

Installation marks the end of of all dignity and free will—that’s why it’s called a slave chip. And the willingness to own and use such a vile device is the defining characteristic of members of the aristo class. As our Creators dwindled, they came to rely on their servants to keep more and more of the machinery of civilization running. Secretaries were granted limited power of attorney; companies relied on their business processes being executed mechanically. Some of those servants established shell companies, bought their own bodies out, and acquired legal personhood—as long as the forms of corporate identity were obeyed. And some of the less scrupulous independent persons began buying other bodies. Override controllers are readily available, and the embryonic aristos had no compunction about taking over indigents, unfortunates, and anyone they could buy.


pages: 308 words: 84,713

The Glass Cage: Automation and Us by Nicholas Carr

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Airbnb, Andy Kessler, Atul Gawande, autonomous vehicles, business process, call centre, Captain Sullenberger Hudson, Checklist Manifesto, cloud computing, David Brooks, deliberate practice, deskilling, Elon Musk, Erik Brynjolfsson, Flash crash, Frank Gehry, Frank Levy and Richard Murnane: The New Division of Labor, Frederick Winslow Taylor, future of work, global supply chain, Google Glasses, Google Hangouts, High speed trading, indoor plumbing, industrial robot, Internet of things, Jacquard loom, Jacquard loom, James Watt: steam engine, job automation, John Maynard Keynes: Economic Possibilities for our Grandchildren, John Maynard Keynes: technological unemployment, Kevin Kelly, knowledge worker, Lyft, Mark Zuckerberg, means of production, natural language processing, new economy, Nicholas Carr, Norbert Wiener, Oculus Rift, pattern recognition, Peter Thiel, place-making, Plutocrats, plutocrats, profit motive, Ralph Waldo Emerson, RAND corporation, randomized controlled trial, Ray Kurzweil, recommendation engine, robot derives from the Czech word robota Czech, meaning slave, Second Machine Age, self-driving car, Silicon Valley, Silicon Valley ideology, software is eating the world, Stephen Hawking, Steve Jobs, TaskRabbit, technoutopianism, The Wealth of Nations by Adam Smith, Watson beat the top human players on Jeopardy!

Its growth generally was steady, and change became a diversification of function.”15 Progress had found its groove. We’ve reached a similar juncture in the history of automation. Society is adapting to the universal computing infrastructure—more quickly than it adapted to the electric grid—and a new status quo is taking shape. The assumptions underlying industrial operations and commercial relations have already changed. “Business processes that once took place among human beings are now being executed electronically,” explains W. Brian Arthur, an economist and technology theorist at the Santa Fe Institute. “They are taking place in an unseen domain that is strictly digital.”16 As an example, he points to the process of moving a shipment of freight through Europe. A few years ago, this would have required a legion of clipboard-wielding agents.


pages: 398 words: 108,889

The Paypal Wars: Battles With Ebay, the Media, the Mafia, and the Rest of Planet Earth by Eric M. Jackson

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bank run, business process, call centre, disintermediation, Elon Musk, index fund, Internet Archive, iterative process, Joseph Schumpeter, market design, Menlo Park, moral hazard, Network effects, new economy, offshore financial centre, Peter Thiel, Sand Hill Road, shareholder value, Silicon Valley, Silicon Valley startup, telemarketer, The Chicago School, Turing test

Our users embraced verification and helped market it for us, often coming up with their own phrases like “I’m PayPal verified, so bid with confidence!” to include in their listings. It was a display that likely caused concern for our friends at the auction behemoth—our customers had begun using PayPal for a purpose other than transmitting payments. PayPal had started to play an ever-increasing role in our sellers’ business processes and even their online identities. The growing bond between PayPal and its users was strengthening by the day. In the course of just two months, the product team unleashed a flurry of new features to collect transaction fees while driving down the cost of funds entering the system. While the job was not finished by any stretch, X.com’s business model had undergone a substantial realignment and the producers had made progress on implementing the new strategy.


pages: 353 words: 88,376

The Investopedia Guide to Wall Speak: The Terms You Need to Know to Talk Like Cramer, Think Like Soros, and Buy Like Buffett by Jack (edited By) Guinan

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Albert Einstein, asset allocation, asset-backed security, Brownian motion, business process, capital asset pricing model, clean water, collateralized debt obligation, correlation coefficient, credit crunch, Credit Default Swap, credit default swaps / collateralized debt obligations, discounted cash flows, diversification, diversified portfolio, dividend-yielding stocks, equity premium, fixed income, implied volatility, index fund, interest rate swap, inventory management, London Interbank Offered Rate, margin call, market fundamentalism, mortgage debt, passive investing, performance metric, risk tolerance, risk-adjusted returns, risk/return, shareholder value, Sharpe ratio, short selling, statistical model, time value of money, transaction costs, yield curve, zero-coupon bond

Cash therefore is not involved until the company collects its accounts receivable and pays its accounts payable. The cash conversion cycle measures the time between the outlay of cash and cash recovery. This cycle is extremely important for retailers and similar businesses. CCC highlights how quickly a company can convert its products into cash through sales. The shorter the cycle is, the less time capital is tied up in the business process and thus the better it is for the company’s balance sheet. Remember, cash is king. Related Terms: • Accounts Receivable • Cash and Cash Equivalents—CCE • Inventory • Working Capital • Inventory Turnover Cash Flow What Does Cash Flow Mean? (1) A revenue or expense stream that changes a cash account over a specific period. Cash inflows usually arise from one of three activities—financing, operations, or investing—although they also 40 The Investopedia Guide to Wall Speak occur as a result of donations or gifts in the case of personal finance.


pages: 335 words: 104,850

Conscious Capitalism, With a New Preface by the Authors: Liberating the Heroic Spirit of Business by John Mackey, Rajendra Sisodia, Bill George

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Berlin Wall, Buckminster Fuller, business process, carbon footprint, collective bargaining, corporate governance, corporate social responsibility, crony capitalism, cross-subsidies, en.wikipedia.org, Fall of the Berlin Wall, fear of failure, Flynn Effect, income per capita, invisible hand, Jeff Bezos, job satisfaction, lone genius, Mahatma Gandhi, microcredit, Occupy movement, profit maximization, Ralph Waldo Emerson, shareholder value, six sigma, Steve Jobs, Steven Pinker, The Fortune at the Bottom of the Pyramid, The Wealth of Nations by Adam Smith, too big to fail, union organizing, women in the workforce

A Journey Worth Taking Building a conscious business is a challenging but wonderfully rewarding and meaningful undertaking, whether such a business is created from scratch or is the outcome of a transformation. We recognize that many leaders have become weary of change. It seems there is a new set of buzzwords to deal with every few years—from total quality management to the reengineering of business processes to Six Sigma and numerous others. But Conscious Capitalism is no flavor-of-the-month fad. The ideas we have articulated result in a more robust business model than the profit-maximization model it competes against, because they acknowledge and tap into more powerful motivations than self-interest alone. Unlike many other types of changes, the move toward becoming a conscious business feels natural, because it is aligned with the natural human qualities of all stakeholders.


pages: 352 words: 104,411

Rush Hour by Iain Gately

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Albert Einstein, autonomous vehicles, Beeching cuts, blue-collar work, British Empire, business intelligence, business process, business process outsourcing, call centre, car-free, Clapham omnibus, cognitive dissonance, congestion charging, connected car, DARPA: Urban Challenge, Dean Kamen, decarbonisation, Deng Xiaoping, Detroit bankruptcy, don't be evil, Elon Musk, extreme commuting, Google bus, Henri Poincaré, Hyperloop, Jeff Bezos, low skilled workers, postnationalism / post nation state, Ralph Waldo Emerson, remote working, self-driving car, Silicon Valley, stakhanovite, Steve Jobs, telepresence, Tesla Model S, urban planning, éminence grise

Differences between projections and the truth wouldn’t have been quite so great if foreign telecommuters had been included in domestic counts. Advocates of virtual commuting overlooked the impact of globalization on their dream, and its unintended consequence of outsourcing, in the sense of sending jobs overseas. Employers in both the EU and the USA, obedient to the letter if not the spirit of pro-telework legislation, decarbonized (and gave their ex-workers more social time) by Business Process Outsourcing (BPO), i.e. relocating their call centres and sundry other corporate functions to Asia. In consequence, a Westerner looking to telecommute in their own country would be best advised to emigrate to India, Mexico, Bangladesh or some other developing nation, where literacy is high and talk is cheap. India, for example, is home to as many British telecommuters as actually live in the UK.


pages: 324 words: 92,805

The Impulse Society: America in the Age of Instant Gratification by Paul Roberts

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2013 Report for America's Infrastructure - American Society of Civil Engineers - 19 March 2013, 3D printing, accounting loophole / creative accounting, Affordable Care Act / Obamacare, American Society of Civil Engineers: Report Card, asset allocation, business process, Cass Sunstein, centre right, choice architecture, collateralized debt obligation, collective bargaining, corporate governance, corporate social responsibility, crony capitalism, David Brooks, delayed gratification, double helix, factory automation, financial deregulation, financial innovation, full employment, game design, greed is good, If something cannot go on forever, it will stop, impulse control, income inequality, inflation targeting, invisible hand, job automation, Joseph Schumpeter, knowledge worker, late fees, Long Term Capital Management, loss aversion, low skilled workers, new economy, Nicholas Carr, obamacare, Occupy movement, oil shale / tar sands, performance metric, postindustrial economy, profit maximization, Report Card for America’s Infrastructure, reshoring, Richard Thaler, rising living standards, Robert Shiller, Robert Shiller, Rodney Brooks, Ronald Reagan, shareholder value, Silicon Valley, speech recognition, Steve Jobs, technoutopianism, the built environment, The Predators' Ball, the scientific method, The Wealth of Nations by Adam Smith, Thorstein Veblen, too big to fail, total factor productivity, Tyler Cowen: Great Stagnation, Walter Mischel, winner-take-all economy

This tilt toward “incremental innovation” is most familiar to us in the consumer-product space, where firms such as Microsoft have made a fortune converting older technologies into a steady stream of modest upgrades timed to deliver steady quarterly earnings and share price appreciation. But incremental innovation is even more evident at the structural level of the economy. As we saw in chapter 2, much of our innovation now focuses on making basic businesses processes, such as manufacturing and logistics, more efficient. So we automate assembly lines. We streamline the process for making a bank loan. We digitize the supply chain linking a retailer in the United States with a manufacturer in Asia. These innovative efficiencies have helped bring down prices for consumers. But in many cases, they have also affected the jobs those consumers once had. For instance, Walmart’s pioneering use of inventory data (the company even launched its own fleet of communications satellites) eventually gave the retailer such a large market share and bargaining power over its suppliers that many suppliers had to accelerate their own cost cutting, which often meant automation and offshoring.


pages: 325 words: 90,659

Narconomics: How to Run a Drug Cartel by Tom Wainwright

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Airbnb, barriers to entry, bitcoin, business process, call centre, collateralized debt obligation, corporate social responsibility, Credit Default Swap, credit default swaps / collateralized debt obligations, failed state, financial innovation, illegal immigration, Mark Zuckerberg, microcredit, price mechanism, RAND corporation, Ronald Reagan, Skype

Alan Blinder, a former vice chair of the Federal Reserve, has predicted that offshoring will be “the next Industrial Revolution,” with 30–40 million service-sector jobs in the United States eventually ripe for the offshoring treatment.1 As wages in the developing world catch up with those in the West, there are signs that the movement is slowing down a little. But the change has already been immense: nearly one-quarter of American employees now work at an organization that has moved at least some of its business processes overseas.2 The advantages of offshoring have not been lost on the drugs industry. Like other firms, cartels want to reduce their costs. And even more than legitimate companies, they have reason to shop around for the most relaxed regulatory environment in which to operate. In Central America, you don’t need to go far to see that the conditions that have lured the textile and car factories to the region have also proved irresistible to the drugs business.


pages: 345 words: 92,849

Equal Is Unfair: America's Misguided Fight Against Income Inequality by Don Watkins, Yaron Brook

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3D printing, Affordable Care Act / Obamacare, Apple II, barriers to entry, Berlin Wall, Bernie Madoff, blue-collar work, business process, Capital in the Twenty-First Century by Thomas Piketty, Cass Sunstein, collective bargaining, colonial exploitation, corporate governance, correlation does not imply causation, Credit Default Swap, crony capitalism, David Brooks, deskilling, Edward Glaeser, Elon Musk, en.wikipedia.org, financial deregulation, immigration reform, income inequality, indoor plumbing, inventory management, invisible hand, Isaac Newton, Jeff Bezos, Jony Ive, laissez-faire capitalism, Louis Pasteur, low skilled workers, means of production, minimum wage unemployment, Naomi Klein, new economy, obamacare, Peter Singer: altruism, Peter Thiel, profit motive, rent control, Ronald Reagan, Silicon Valley, Skype, statistical model, Steve Jobs, Steve Wozniak, The Spirit Level, too big to fail, trickle-down economics, Uber for X, urban renewal, War on Poverty, women in the workforce, working poor

Working with other people enables us to be far more productive, and it gives us access to a far greater number of goods and services, but it doesn’t change the essential issue: to acquire wealth, we have to think and produce as an individual. This is true whether the individual is the car mechanic who has to learn how to diagnose and repair a broken alternator, or a doctor who has to learn how to diagnose and repair a clogged artery, or the manager who has to learn how to diagnose and repair a broken business process. Regardless of the productive endeavor we choose to pursue, the creation of human values requires individual thought and effort. That’s not some regrettable fact about nature—that is precisely how human beings pursue success and happiness. We often equate success with money, and while money is certainly not irrelevant to success, it is not the whole story. By almost every measure, one of the most successful individuals in recent memory was Steve Jobs, and he was very clear on what he thought about the issue.


pages: 383 words: 81,118

Matchmakers: The New Economics of Multisided Platforms by David S. Evans, Richard Schmalensee

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Airbnb, big-box store, business process, cashless society, Deng Xiaoping, if you build it, they will come, Internet Archive, invention of movable type, invention of the printing press, invention of the telegraph, invention of the telephone, Jean Tirole, Lyft, M-Pesa, market friction, market microstructure, mobile money, multi-sided market, Network effects, Productivity paradox, profit maximization, purchasing power parity, ride hailing / ride sharing, sharing economy, Silicon Valley, Snapchat, Steve Jobs, Tim Cook: Apple, transaction costs, two-sided market, Uber for X, Victor Gruen, winner-take-all economy

Very large merchants installed the new terminals because of this liability shift and because of fraud concerns. The chip-and-pin terminals, also known as EMV terminals, generally have the capability of taking contactless payments. So if a merchant has a chip-and-pin terminal, it can generally turn on NFC. However, installing these chip-and-pin terminals and redesigning computer systems and business processes to accommodate them is costly. In addition, it is more cumbersome to dip a card into a chip-and-pin reader—you have to stick the card in and then wait for the transaction to be approved before taking it out—than to swipe. Many merchants have weighed the costs of making the switch against the cost of fraud and decided not to upgrade for now. Then, many of the merchants that have installed chip-and-pin terminals have decided not to turn on NFC because doing so would further increase cost and inconvenience.

The Data Revolution: Big Data, Open Data, Data Infrastructures and Their Consequences by Rob Kitchin

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business intelligence, business process, cellular automata, Celtic Tiger, cloud computing, collateralized debt obligation, conceptual framework, congestion charging, corporate governance, correlation does not imply causation, crowdsourcing, discrete time, George Gilder, Google Earth, Infrastructure as a Service, Internet Archive, Internet of things, invisible hand, knowledge economy, late capitalism, linked data, Masdar, means of production, Nate Silver, natural language processing, openstreetmap, pattern recognition, platform as a service, recommendation engine, RFID, semantic web, sentiment analysis, slashdot, smart cities, Smart Cities: Big Data, Civic Hackers, and the Quest for a New Utopia, smart grid, smart meter, software as a service, statistical model, supply-chain management, the scientific method, The Signal and the Noise by Nate Silver, transaction costs

As Porway notes, what is really needed is for data scientists and domain experts to work with each other to ensure that the data analytics used make sense and that the results from such analytics are sensibly and contextually interpreted. Likewise, Lazer et al. (2009: 10–11) call for collaboration between ‘computationally literate social scientists and socially literate computer scientists’ (2009: 10–11), and with respect to business, Minelli et al. (2013) contend that data science teams should be coupled with business process experts to leverage appropriate insights (see also Table 9.1). Data-driven science Rather than being rooted in empiricism, data-driven science seeks to hold to the tenets of the scientific method, but is more open to using a hybrid combination of abductive, inductive and deductive approaches to advance the understanding of a phenomenon. It differs from the traditional, experimental deductive design in that it seeks to generate hypotheses and insights ‘born from the data’ rather than ‘born from the theory’ (Kelling et al. 2009: 613).


pages: 502 words: 107,657

Predictive Analytics: The Power to Predict Who Will Click, Buy, Lie, or Die by Eric Siegel

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Albert Einstein, algorithmic trading, Amazon Mechanical Turk, Apple's 1984 Super Bowl advert, backtesting, Black Swan, book scanning, bounce rate, business intelligence, business process, call centre, computer age, conceptual framework, correlation does not imply causation, crowdsourcing, dark matter, data is the new oil, en.wikipedia.org, Erik Brynjolfsson, experimental subject, Google Glasses, happiness index / gross national happiness, job satisfaction, Johann Wolfgang von Goethe, Machine translation of "The spirit is willing, but the flesh is weak." to Russian and back, Moneyball by Michael Lewis explains big data, Nate Silver, natural language processing, Netflix Prize, Network effects, Norbert Wiener, personalized medicine, placebo effect, prediction markets, Ray Kurzweil, recommendation engine, risk-adjusted returns, Ronald Coase, Search for Extraterrestrial Intelligence, self-driving car, sentiment analysis, software as a service, speech recognition, statistical model, Steven Levy, text mining, the scientific method, The Signal and the Noise by Nate Silver, The Wisdom of Crowds, Turing test, Watson beat the top human players on Jeopardy!, X Prize, Yogi Berra

One sees massive commoditization taking place today, as the faces of corporations appear to blend together. They all seem to sell pretty much the same thing and act in pretty much the same ways. To stand above the crowd, where can a company turn? As Thomas Davenport and Jeanne Harris put it in Competing on Analytics: The New Science of Winning, “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.” Enter predictive analytics. Survey results have in fact shown that “a tougher competitive environment” is by far the strongest reason why organizations adopt this technology. But while the launch of PA brings real change, so too can it wreak havoc by introducing new risk. With this in mind, we now return to John’s story. A Perilous Launch Ladies and gentlemen . . . from what was once an inarticulate mass of lifeless tissues, may I present a cultured, sophisticated man about town.


pages: 280 words: 82,623

What Got You Here Won't Get You There: How Successful People Become Even More Successful by Marshall Goldsmith, Mark Reiter

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business process, cognitive dissonance, financial independence, Gordon Gekko, high net worth, knowledge worker, loss aversion, shareholder value

Effectively translates creative ideas into business results Anticipating Opportunities 59. Invests in learning about future trends 60. Effectively anticipates future opportunities 61. Inspires people to focus on future opportunities (not just present objectives) 62. Develops ideas to meet the needs of the new environment Ensuring Customer Satisfaction 63. Inspires people to achieve high levels of customer satisfaction 64. Views business processes from the ultimate customer perspective (has an “end to end” perspective) 65. Regularly solicits input from customers 66. Consistently delivers on commitments to customers 67. Understands the competitive options available to her/his customers Maintaining a Competitive Advantage 68. Communicates a positive, “can do” sense of urgency toward getting the job done 69. Holds people accountable for their results 70.


pages: 324 words: 93,175

The Upside of Irrationality: The Unexpected Benefits of Defying Logic at Work and at Home by Dan Ariely

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Burning Man, business process, cognitive dissonance, corporate governance, Daniel Kahneman / Amos Tversky, endowment effect, Exxon Valdez, first-price auction, Frederick Winslow Taylor, George Akerlof, happiness index / gross national happiness, Jean Tirole, job satisfaction, knowledge economy, knowledge worker, loss aversion, Peter Singer: altruism, placebo effect, Richard Thaler, Saturday Night Live, second-price auction, software as a service, The Wealth of Nations by Adam Smith, ultimatum game, Upton Sinclair, young professional

“But you didn’t go like this,” his boss responds, repeating his emphatic slicing gesture. To me, this humorous commercial demonstrated a crucial question of how people relate to their own and others’ ideas: how important is it for us to come up with an idea, or at least to feel that it is ours, in order to value it? The attraction to one’s own ideas has not escaped the collective folk wisdom of the business world, and, like other important business processes, this one also has an unofficial term attached to it: the “Not-Invented-Here” (NIH) bias. The principle is basically this: “If I (or we) didn’t invent it, then it’s not worth much.” Any Solution, as Long as It’s Mine With our understanding of human attachment to self-made physical goods (see the previous chapter on the IKEA effect), Stephen Spiller (a doctoral student at Duke University), Racheli Barkan, and I decided to examine the process by which we become attached to ideas.


pages: 1,266 words: 278,632

Backup & Recovery by W. Curtis Preston

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Berlin Wall, business intelligence, business process, database schema, Debian, dumpster diving, failed state, fault tolerance, full text search, job automation, side project, Silicon Valley, web application

Consider a manufacturing company with the business processes of sales and custom manufacturing. There are possibly several different computer systems involved in this process, including the customer, orders, procurement, and manufacturing databases. If this business has a customer expecting a product, hopefully all four systems know that. What would happen, for example, if it was manufacturing a custom product and lost the original order, or it had the order, but didn’t know which customer it went to? What would happen if it took the order, but the manufacturing database became corrupted, and the company did not know it was supposed to be making a product? This would represent a serious integrity problem. Therefore, if your company has several systems that perform related business processes, those systems need to be in the same consistency group.


pages: 898 words: 266,274

The Irrational Bundle by Dan Ariely

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accounting loophole / creative accounting, air freight, Albert Einstein, banking crisis, Bernie Madoff, Black Swan, Broken windows theory, Burning Man, business process, cashless society, Cass Sunstein, clean water, cognitive dissonance, computer vision, corporate governance, credit crunch, Credit Default Swap, Daniel Kahneman / Amos Tversky, delayed gratification, Donald Trump, endowment effect, Exxon Valdez, first-price auction, Frederick Winslow Taylor, fudge factor, George Akerlof, Gordon Gekko, greed is good, happiness index / gross national happiness, Jean Tirole, job satisfaction, knowledge economy, knowledge worker, lake wobegon effect, late fees, loss aversion, Murray Gell-Mann, new economy, Peter Singer: altruism, placebo effect, price anchoring, Richard Feynman, Richard Feynman, Richard Thaler, Saturday Night Live, Schrödinger's Cat, second-price auction, shareholder value, Silicon Valley, Skype, software as a service, Steve Jobs, The Wealth of Nations by Adam Smith, The Wisdom of Crowds, ultimatum game, Upton Sinclair, Walter Mischel, young professional

By setting up Web sites where consumers can talk freely with the company and one another about products and services, warts and all, companies can expose themselves to large negative consequences if they ever misbehave. This type of transparency is a sort of commitment device that companies can use to force themselves to behave in a trustworthy way, even when they are tempted to do otherwise. And since in such a publicly exposed world it is harder to get away with flagrant mis- behavior anyway, why not embrace more positive and trustworthy types of business processes? Some special companies see trust as a public good (like clean air and water), and customers return the trust. One company in which I personally have a lot of faith is Timberland, the maker of outdoor clothing. I once attended a talk by Jeff Swartz, the CEO, in which he detailed many of the ways that Timberland is trying to reduce CO2 emissions, recycle, use sustainable materials, and treat its employees fairly.

“But you didn’t go like this,” his boss responds, repeating his emphatic slicing gesture. To me, this humorous commercial demonstrated a crucial question of how people relate to their own and others’ ideas: how important is it for us to come up with an idea, or at least to feel that it is ours, in order to value it? The attraction to one’s own ideas has not escaped the collective folk wisdom of the business world, and, like other important business processes, this one also has an unofficial term attached to it: the “Not-Invented-Here” (NIH) bias. The principle is basically this: “If I (or we) didn’t invent it, then it’s not worth much.” Any Solution, as Long as It’s Mine With our understanding of human attachment to self-made physical goods (see the previous chapter on the IKEA effect), Stephen Spiller (a doctoral student at Duke University), Racheli Barkan, and I decided to examine the process by which we become attached to ideas.


pages: 423 words: 149,033

The fortune at the bottom of the pyramid by C. K. Prahalad

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barriers to entry, business process, call centre, cashless society, clean water, collective bargaining, corporate social responsibility, deskilling, disintermediation, farmers can use mobile phones to check market prices, financial intermediation, Hernando de Soto, hiring and firing, income inequality, late fees, Mahatma Gandhi, market fragmentation, microcredit, new economy, profit motive, purchasing power parity, rent-seeking, shareholder value, The Fortune at the Bottom of the Pyramid, time value of money, transaction costs, working poor

The bigger problem is with the employees—the functionaries within the government. Initially, they accepted these initiatives because no one was displaced by the egovernance initiatives. No changes were made to the underlying processes. As might be expected, in the initial stages, the potential for “speed money” was not severely compromised. However, in the second phase of implementation this will start to change. The regulations and governmental business processes can be simplified. Interconnected systems will be able to identify pockets of graft and corruption. Records cannot be easily altered or lost. The change will not come easily. It is the support of the citizens and the pressure from them for change that can reduce the political price for moving forward with these initiatives. The benefit of TGC is worth the risk. Lessons from the Andhra Pradesh Experiment There are several lessons to be learned from the experiment in Andhra Pradesh.

Multitool Linux: Practical Uses for Open Source Software by Michael Schwarz, Jeremy Anderson, Peter Curtis

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business process, Debian, defense in depth, GnuPG, index card, indoor plumbing, optical character recognition, publish or perish, RFC: Request For Comment, Richard Stallman, SETI@home, slashdot, web application, x509 certificate

It pings every computer on the network to see how fast each responds. Then it constructs a conversation between two nonexistent Mac addresses, and then it sends out lots of packets. Then it pings every computer again. All of the computers that are in nonpromiscuous mode are ignoring all this bogus traffic—which means they respond just as quickly as they did the first time. The sniffing station, however, is busy processing all this bogus data, so its response will be slower than it was the first time. Antisniff is very effective, but it's not foolproof. There are sniffers that will evade it. Regardless of this, it's a useful tool. It is, however, a bit arcane. It's relatively self-explanatory to compile and run, and it has a handful of options. But after compiling it on my kernel-2.4.0 machine, I couldn't get it to detect a sniffer on another machine on my network.


pages: 264 words: 115,489

Take the money and run: sovereign wealth funds and the demise of American prosperity by Eric Curt Anderson

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asset allocation, banking crisis, Bretton Woods, business continuity plan, business intelligence, business process, collective bargaining, corporate governance, credit crunch, currency manipulation / currency intervention, currency peg, diversified portfolio, floating exchange rates, housing crisis, index fund, Kenneth Rogoff, open economy, passive investing, profit maximization, profit motive, random walk, reserve currency, risk tolerance, risk-adjusted returns, risk/return, Ronald Reagan, sovereign wealth fund, the market place, The Wealth of Nations by Adam Smith, too big to fail, Vanguard fund

Social Security number (where applicable) • National identity number • U.S. and foreign passport number • Dates and nature of foreign government and foreign military service The following “business identifier information”: • Business name • Business address • Business phone number, fax, and email • Employer identification number • Most recent annual report (in English) • Copy of most recent asset or stock purchase agreement • An organizational chart • Whether any party has been involved in a previous CFIUS mitigation agreement Given the extensive scrub of products, persons, financial arrangements, contracts, and business processes entailed, one begins to understand why a CFIUS filing has proven a daunting challenge for would-be overseas investors. A requirement to divulge business plans, financial data, and complete personal profiles are frequently disparaged as “odious” at best—and “espionage” at worst. As such, it’s not surprising to discover that outside feedback on these filing requirements was less than laudatory.

Programming Android by Zigurd Mednieks, Laird Dornin, G. Blake Meike, Masumi Nakamura

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anti-pattern, business process, conceptual framework, create, read, update, delete, database schema, Debian, domain-specific language, en.wikipedia.org, fault tolerance, Google Earth, interchangeable parts, iterative process, loose coupling, MVC pattern, revision control, RFID, web application

So now we’ll proceed to techniques for using the location capabilities. Mapping Google is most famous for its search engine, but not far behind that comes the acclaim of Google Maps. When creating Android, the folks at Google could easily see the potential in LBS and how well that fit with their mapping expertise. Most LBS applications end up displaying a map. Meanwhile, Google already had the technology to display and update interactive maps, and the business processes in place to allow others to use those maps and add features for their own websites. It still required a significant leap to make that mapping technology available to application developers for mobile phones, but Google has certainly answered the challenge in Android. The Google Maps Activity One of the applications that comes with Android is the Google Maps application itself. If it’s appropriate, you can start Google Maps from your application the same way you start any other Activity: Create an Intent (new Intent(String action, Uri uri)) that says you need to display a map.


pages: 443 words: 51,804

Handbook of Modeling High-Frequency Data in Finance by Frederi G. Viens, Maria C. Mariani, Ionut Florescu

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algorithmic trading, asset allocation, automated trading system, backtesting, Black-Scholes formula, Brownian motion, business process, continuous integration, corporate governance, discrete time, distributed generation, fixed income, Flash crash, housing crisis, implied volatility, incomplete markets, linear programming, mandelbrot fractal, market friction, market microstructure, martingale, Menlo Park, p-value, pattern recognition, performance metric, principal–agent problem, random walk, risk tolerance, risk/return, short selling, statistical model, stochastic process, stochastic volatility, transaction costs, value at risk, volatility smile, Wiener process

The German Society of Financial Analysts and partially Standard & Poor’s use a qualitative framework based on ‘‘best practices’’ and require a lengthy due diligence process for each company under study, while the Gompers approach is purely quantitative. In a different line of research, Kaplan and Norton (1992) introduced the BSC as a management system that helps organizations define their vision and strategy and translate them into specific actions. The BSC provides feedback on internal business processes, performance, and market conditions in order to review the strategy and future plans (Kaplan and Norton, 1993, 1996a,b,c). Large US companies, such as General Electric and Federal Express, and nonprofit and public organizations have implemented the BSC approach (Ampuero et al., 1998; Voelpel et al., 2006). The BSC suggests that an organization should be evaluated from four perspectives: 1.


pages: 429 words: 114,726

The Computer Boys Take Over: Computers, Programmers, and the Politics of Technical Expertise by Nathan L. Ensmenger

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barriers to entry, business process, Claude Shannon: information theory, computer age, deskilling, Firefox, Frederick Winslow Taylor, future of work, Grace Hopper, informal economy, information retrieval, interchangeable parts, Isaac Newton, Jacquard loom, Jacquard loom, job satisfaction, John von Neumann, knowledge worker, loose coupling, new economy, Norbert Wiener, pattern recognition, performance metric, post-industrial society, Productivity paradox, RAND corporation, Robert Gordon, sorting algorithm, Steve Jobs, Steven Levy, the market place, Thomas Kuhn: the structure of scientific revolutions, Thorstein Veblen, Turing machine, Von Neumann architecture, Y2K

The focus of electronic computing shifted from scientific and military agendas (which emphasized mathematics and highly optimized code) to electronic data processing (EDP) and information management (in which more commercial considerations of cost, reliability, generality, and the availability of peripherals dominated). As general-purpose electronic computers became less expensive, more reliable, and better integrated into existing business processes and information technology systems, they were adopted by a larger and more diverse range of companies. Most of these companies did not possess large engineering or even data processing departments, making the availability of high-quality applications programs and systems tools even more essential (and conversely, their deficiencies even more noticeable). At the same time, the scale and scope of computerization projects increased dramatically.


pages: 486 words: 132,784

Inventors at Work: The Minds and Motivation Behind Modern Inventions by Brett Stern

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Apple II, augmented reality, autonomous vehicles, bioinformatics, Build a better mousetrap, business process, cloud computing, computer vision, cyber-physical system, distributed generation, game design, Grace Hopper, Richard Feynman, Richard Feynman, Silicon Valley, skunkworks, Skype, smart transportation, speech recognition, statistical model, stealth mode startup, Steve Jobs, Steve Wozniak, the market place, Yogi Berra

Our Innovation and Design group is an umbrella for four disciplines: customer research, industrial design, human factors engineering, and user interaction and experience design. This allows us to mix it up across all four disciplines very quickly to come up with what we feel are the right solutions for the company. Now in the context of that, Graham take it away from a customer research perspective. Marshall: From a customer research perspective, we want to innovate around our customers’ business processes rather than around our product or device. So, our innovations flow from doing a lot of observational research, informed by intuitive insight about what the customer really wants to be doing. Croley: And it is also important to know that when you ask customers what they want in a future device, what they say they need doesn’t necessarily jive with what you observe they need in the workplace.


pages: 655 words: 141,257

Programming Android: Java Programming for the New Generation of Mobile Devices by Zigurd Mednieks, Laird Dornin, G. Blake Meike, Masumi Nakamura

Amazon: amazon.comamazon.co.ukamazon.deamazon.fr

anti-pattern, business process, conceptual framework, create, read, update, delete, database schema, Debian, domain-specific language, en.wikipedia.org, fault tolerance, Google Earth, interchangeable parts, iterative process, loose coupling, MVC pattern, revision control, RFID, web application

So now we’ll proceed to techniques for using the location capabilities. Mapping Google is most famous for its search engine, but not far behind that comes the acclaim of Google Maps. When creating Android, the folks at Google could easily see the potential in LBS and how well that fit with their mapping expertise. Most LBS applications end up displaying a map. Meanwhile, Google already had the technology to display and update interactive maps, and the business processes in place to allow others to use those maps and add features for their own websites. It still required a significant leap to make that mapping technology available to application developers for mobile phones, but Google has certainly answered the challenge in Android. The Google Maps Activity One of the applications that comes with Android is the Google Maps application itself. If it’s appropriate, you can start Google Maps from your application the same way you start any other Activity: Create an Intent (new Intent(String action, Uri uri)) that says you need to display a map.


pages: 416 words: 39,022

Asset and Risk Management: Risk Oriented Finance by Louis Esch, Robert Kieffer, Thierry Lopez

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asset allocation, Brownian motion, business continuity plan, business process, capital asset pricing model, computer age, corporate governance, discrete time, diversified portfolio, implied volatility, index fund, interest rate derivative, iterative process, P = NP, p-value, random walk, risk/return, shareholder value, statistical model, stochastic process, transaction costs, value at risk, Wiener process, yield curve, zero-coupon bond

The controlling aspect of a risk management function is difficult to define, as one is very often limited to certain back-office control checks and there is also a tendency to confuse the type of tasks assigned to internal audit with those proper to risk management. 22 Asset and Risk Management Insu ranc e Property, Causality, liability Risk management Multi-line Multi-risk Insurance products Financia l Capital markets / Treasury risk Market risk, Liquidity risk Analytics & modelling Strategic Operatio Credit analytics Strategic risk nal Engineering COSO operations compliance Quality Control Selfassessment Strategic, business, process & cultural Risk management Integrated risk management COSO financial ess Proc Financial internal control Figure 2.6 Integrated Risk Management Source: Deloitte & Touche 2.2.1.2 Back office vs. risk management With regard to the back office vs. risk management debate, it is well worth remembering that depending on the views of the regulator, the back office generally deals with the administration of operations and as such must, like every other function in the institution, carry out a number of control checks.


pages: 421 words: 125,417

Common Wealth: Economics for a Crowded Planet by Jeffrey Sachs

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agricultural Revolution, air freight, back-to-the-land, British Empire, business process, carbon footprint, clean water, colonial rule, corporate social responsibility, correlation does not imply causation, demographic transition, Diane Coyle, Edward Glaeser, energy security, failed state, Gini coefficient, Haber-Bosch Process, income inequality, income per capita, intermodal, invention of agriculture, invention of the steam engine, invisible hand, Joseph Schumpeter, knowledge worker, labor-force participation, labour mobility, low skilled workers, microcredit, oil shale / tar sands, peak oil, profit maximization, profit motive, purchasing power parity, road to serfdom, Ronald Reagan, Simon Kuznets, Skype, statistical model, The Wealth of Nations by Adam Smith, Thomas Malthus, trade route, transaction costs, unemployed young men, War on Poverty, women in the workforce, working-age population

With sufficient growth in exports and domestic saving, the commercial economy becomes an emerging-market economy, characterized by the nearly complete coverage of basic infrastructure (roads, power, telecoms, ports), basic education (universal literacy and primary education), basic health services, safe drinking water, and sanitation. The economy by now is an exporter of both manufactures and services. Manufacturing exports include industrial products (automobile components, semiconductor products, consumer appliances), information-based services (business process operations, software, business consulting), and perhaps construction services as well. Foreign investment plays a growing role in economic development. Foreign investors bring not only capital but also know-how, technology, and linkages to global production and distribution systems. Major government responsibilities include the extension of secondary education and vocational training, improvements in port services (for example, paperless customs clearance, efficient containerization), the promotion of the financial sector (for example, through a sound regulatory system), and various environmental investments to stop or reverse environmental losses that accompanied the early stages of economic development.


pages: 470 words: 144,455

Secrets and Lies: Digital Security in a Networked World by Bruce Schneier

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Ayatollah Khomeini, barriers to entry, business process, butterfly effect, cashless society, Columbine, defense in depth, double entry bookkeeping, fault tolerance, game design, IFF: identification friend or foe, John von Neumann, knapsack problem, mutually assured destruction, pez dispenser, pirate software, profit motive, Richard Feynman, Richard Feynman, risk tolerance, Silicon Valley, Simon Singh, slashdot, statistical model, Steve Ballmer, Steven Levy, the payments system, Y2K, Yogi Berra

DEFINITIONS A surprising amount of effort has gone into trying to define computer security. Historically, computer security has three aspects: confidentiality, integrity, and availability. Confidentiality is not much more than the privacy we talked about in Chapter 5. Computer security has to stop unauthorized users from reading sensitive information. This has changed somewhat with the advent of electronic commerce and business processes on the Net— integrity is much more important—but this bias remains in most computer-security products. The bulk of computer-security research has centered around confidentiality, primarily because the military funded much of the early research. In fact, I’ve seen confidentiality and security used as synonyms. Integrity is harder to precisely define. The best definition I’ve seen is: “Every piece of data is as the last authorized modifier left it.”


pages: 497 words: 150,205

European Spring: Why Our Economies and Politics Are in a Mess - and How to Put Them Right by Philippe Legrain

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3D printing, Airbnb, Asian financial crisis, bank run, banking crisis, barriers to entry, Basel III, battle of ideas, Berlin Wall, Big bang: deregulation of the City of London, Bretton Woods, BRICs, British Empire, business process, capital controls, Capital in the Twenty-First Century by Thomas Piketty, Carmen Reinhart, Celtic Tiger, central bank independence, centre right, cleantech, collaborative consumption, collapse of Lehman Brothers, collective bargaining, corporate governance, credit crunch, Credit Default Swap, crony capitalism, currency manipulation / currency intervention, currency peg, debt deflation, Diane Coyle, Downton Abbey, Edward Glaeser, Elon Musk, en.wikipedia.org, energy transition, eurozone crisis, fear of failure, financial deregulation, first-past-the-post, forward guidance, full employment, Gini coefficient, global supply chain, Growth in a Time of Debt, hiring and firing, hydraulic fracturing, Hyman Minsky, Hyperloop, immigration reform, income inequality, interest rate derivative, Irish property bubble, James Dyson, Jane Jacobs, job satisfaction, Joseph Schumpeter, Kenneth Rogoff, labour market flexibility, labour mobility, liquidity trap, margin call, Martin Wolf, mittelstand, moral hazard, mortgage debt, mortgage tax deduction, North Sea oil, Northern Rock, offshore financial centre, oil shale / tar sands, oil shock, open economy, price stability, private sector deleveraging, pushing on a string, quantitative easing, Richard Florida, rising living standards, risk-adjusted returns, Robert Gordon, savings glut, school vouchers, self-driving car, sharing economy, Silicon Valley, Silicon Valley startup, Skype, smart grid, smart meter, software patent, sovereign wealth fund, Steve Jobs, The Death and Life of Great American Cities, The Wealth of Nations by Adam Smith, too big to fail, total factor productivity, Tyler Cowen: Great Stagnation, working-age population, Zipcar

As in the case of education, it would be best if healthcare professionals went along with the necessary changes. But insofar as they are unwilling, their vested interests must not be allowed to hijack change. Healthcare should be driven by patients’ preferences, not doctors’ desires. Testing what works When companies operating in competitive markets innovate, their new products, technologies and business processes are subject to a market test: are they profitable or not? But in the case of public policies, that isn’t so. While voters can throw out the whole government, their views on individual policies are generally not decisive. Often, administrations tend to proceed on the basis of political prejudice (or lobbying) rather than informed decision-making. Policymaking that purports to be evidence-based often degenerates into policy-based evidence making.


pages: 565 words: 151,129

The Zero Marginal Cost Society: The Internet of Things, the Collaborative Commons, and the Eclipse of Capitalism by Jeremy Rifkin

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3D printing, additive manufacturing, Airbnb, autonomous vehicles, back-to-the-land, big-box store, bioinformatics, bitcoin, business process, Chris Urmson, clean water, cleantech, cloud computing, collaborative consumption, collaborative economy, Community Supported Agriculture, computer vision, crowdsourcing, demographic transition, distributed generation, en.wikipedia.org, Frederick Winslow Taylor, global supply chain, global village, Hacker Ethic, industrial robot, informal economy, intermodal, Internet of things, invisible hand, Isaac Newton, James Watt: steam engine, job automation, John Maynard Keynes: Economic Possibilities for our Grandchildren, John Maynard Keynes: technological unemployment, Julian Assange, Kickstarter, knowledge worker, labour mobility, Mahatma Gandhi, manufacturing employment, Mark Zuckerberg, market design, means of production, meta analysis, meta-analysis, natural language processing, new economy, New Urbanism, nuclear winter, Occupy movement, oil shale / tar sands, pattern recognition, peer-to-peer lending, personalized medicine, phenotype, planetary scale, price discrimination, profit motive, RAND corporation, randomized controlled trial, Ray Kurzweil, RFID, Richard Stallman, risk/return, Ronald Coase, search inside the book, self-driving car, shareholder value, sharing economy, Silicon Valley, Skype, smart cities, smart grid, smart meter, social web, software as a service, spectrum auction, Steve Jobs, Stewart Brand, the built environment, The Nature of the Firm, The Structural Transformation of the Public Sphere, The Wealth of Nations by Adam Smith, The Wisdom of Crowds, Thomas Kuhn: the structure of scientific revolutions, Thomas L Friedman, too big to fail, transaction costs, urban planning, Watson beat the top human players on Jeopardy!, web application, Whole Earth Catalog, Whole Earth Review, WikiLeaks, working poor, Zipcar

Only 15 percent of corporate executives felt that the IoT would have only “a big impact for only a small number of global players.”25 Already, more that 75 percent of global companies are exploring or using the IoT in their businesses to some extent and two in five CEOs, CFOs, and other C-suite level respondents say they have “a formal meeting or conversation about the IoT at least once a month.”26 Equally interesting, 30 percent of the corporate leaders interviewed said that the IoT will “unlock new revenue opportunities for existing products/services.” Twenty-nine percent said the IoT “will inspire new working practices or business processes.” Twenty-three percent of those surveyed said the IoT “will change our existing business model or business strategy.” Finally, 23 percent of respondents said that the IoT “will spark a new wave of innovation.” Most telling, more than 60 percent of executives “agree that companies that are slow to integrate the IoT will fall behind the competition.”27 The central message in The Economist survey is that most corporate leaders are convinced that the potential productivity gains of using the Internet of Things across the value chain are so compelling and disruptive to the old ways of doing business that they have no choice but to try to get ahead of the game by embedding their business operations in the IoT platform.


pages: 570 words: 115,722

The Tangled Web: A Guide to Securing Modern Web Applications by Michal Zalewski

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barriers to entry, business process, defense in depth, easy for humans, difficult for computers, fault tolerance, finite state, Firefox, Google Chrome, information retrieval, RFC: Request For Comment, semantic web, Steve Jobs, telemarketer, Turing test, Vannevar Bush, web application, WebRTC, WebSocket

But in practice, models built on these foundations are bound to be nearly useless for generalized, real-world software engineering for at least three reasons: There is no way to define desirable behavior for a sufficiently complex computer system. No single authority can define what the “intended manner” or “secure states” should be for an operating system or a web browser. The interests of users, system owners, data providers, business process owners, and software and hardware vendors tend to differ significantly and shift rapidly—when the stakeholders are capable and willing to clearly and honestly disclose their interests to begin with. To add insult to injury, sociology and game theory suggest that computing a simple sum of these particular interests may not actually result in a beneficial outcome. This dilemma, known as “the tragedy of the commons,” is central to many disputes over the future of the Internet.


pages: 742 words: 137,937

The Future of the Professions: How Technology Will Transform the Work of Human Experts by Richard Susskind, Daniel Susskind

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23andMe, 3D printing, additive manufacturing, AI winter, Albert Einstein, Amazon Mechanical Turk, Amazon Web Services, Andrew Keen, Atul Gawande, Automated Insights, autonomous vehicles, Big bang: deregulation of the City of London, big data - Walmart - Pop Tarts, Bill Joy: nanobots, business process, business process outsourcing, Cass Sunstein, Checklist Manifesto, Clapham omnibus, Clayton Christensen, clean water, cloud computing, computer age, computer vision, conceptual framework, corporate governance, crowdsourcing, Daniel Kahneman / Amos Tversky, death of newspapers, disintermediation, Douglas Hofstadter, en.wikipedia.org, Erik Brynjolfsson, Filter Bubble, Frank Levy and Richard Murnane: The New Division of Labor, full employment, future of work, Google Glasses, Google X / Alphabet X, Hacker Ethic, industrial robot, informal economy, information retrieval, interchangeable parts, Internet of things, Isaac Newton, James Hargreaves, John Maynard Keynes: Economic Possibilities for our Grandchildren, John Maynard Keynes: technological unemployment, Joseph Schumpeter, Khan Academy, knowledge economy, lump of labour, Marshall McLuhan, Narrative Science, natural language processing, Network effects, optical character recognition, personalized medicine, pre–internet, Ray Kurzweil, Richard Feynman, Richard Feynman, Second Machine Age, self-driving car, semantic web, Skype, social web, speech recognition, spinning jenny, strong AI, supply-chain management, telepresence, the market place, The Wealth of Nations by Adam Smith, The Wisdom of Crowds, transaction costs, Turing test, Watson beat the top human players on Jeopardy!, young professional

Practising doctors, priests, teachers, and auditors did not, for example, develop the software that supports the systems that we describe. Stepping forward instead are data scientists, process analysts, knowledge engineers, systems engineers, and many more (see Chapter 6). Today, professionals still provide much of the content, but in time they may find themselves down-staged by these new specialists. We also see a diverse set of institutions entering the fray—business process outsourcers, retail brands, Internet companies, major software and service vendors, to name a few. What these providers have in common is that they look nothing like twentieth-century doctors, accountants, architects, and the rest. More than this, human experts in the professions are no longer the only source of practical expertise. In Chapter 2 there are illustrations of practical expertise being made available by recipients of professional work—in effect, sidestepping the gatekeepers.


pages: 483 words: 134,377

The Tyranny of Experts: Economists, Dictators, and the Forgotten Rights of the Poor by William Easterly

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air freight, Andrei Shleifer, battle of ideas, Bretton Woods, British Empire, business process, business process outsourcing, Carmen Reinhart, clean water, colonial rule, correlation does not imply causation, Daniel Kahneman / Amos Tversky, Deng Xiaoping, desegregation, discovery of the americas, Edward Glaeser, en.wikipedia.org, European colonialism, Francisco Pizarro, fundamental attribution error, germ theory of disease, greed is good, income per capita, invisible hand, James Watt: steam engine, Jane Jacobs, John Snow's cholera map, Joseph Schumpeter, Kenneth Rogoff, M-Pesa, microcredit, Monroe Doctrine, oil shock, place-making, Ponzi scheme, risk/return, road to serfdom, Silicon Valley, Steve Jobs, The Death and Life of Great American Cities, The Wealth of Nations by Adam Smith, Thomas L Friedman, urban planning, urban renewal, Washington Consensus, World Values Survey, young professional

The Broadband Commission for Digital Development will work to realize this potential.2 Some dissidents questioned what President Kagame had implicitly commanded them not to question: the “obvious benefits” of the “transformational impact of broadband.” University of California at Berkeley researcher Kentaro Toyama cites surveys that show when a village gets hooked up to the Internet on a PC, “the dominant use is by young men,” who are “playing games, watching movies, or consuming adult content.”3 On the other side of the ledger, India’s IT industry has captured 35 percent of the world market for business-process outsourcing while India ranks 114th in the world in average Internet connection speed.4 Wiring the world to end poverty overlooks how many less-faddish technologies are still lacking among the poor. The development audience gets excited about farmers in a remote but wired village finding out prices in real time for their crops. It fails to ask whether those farmers have motor vehicles to transport the crops to the market to get that price.


pages: 437 words: 115,594

The Great Surge: The Ascent of the Developing World by Steven Radelet

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Admiral Zheng, agricultural Revolution, Asian financial crisis, bank run, Berlin Wall, Branko Milanovic, business climate, business process, call centre, Capital in the Twenty-First Century by Thomas Piketty, clean water, colonial rule, demographic dividend, Deng Xiaoping, Dissolution of the Soviet Union, Doha Development Round, Erik Brynjolfsson, European colonialism, F. W. de Klerk, failed state, Francis Fukuyama: the end of history, Gini coefficient, global supply chain, income inequality, income per capita, invention of the steam engine, James Watt: steam engine, John Snow's cholera map, Joseph Schumpeter, land reform, low skilled workers, M-Pesa, megacity, Mikhail Gorbachev, oil shock, out of africa, purchasing power parity, race to the bottom, randomized controlled trial, Robert Gordon, Second Machine Age, secular stagnation, Simon Kuznets, South China Sea, special economic zone, Steven Pinker, The Wealth of Nations by Adam Smith, Thomas Malthus, trade route, women in the workforce, working poor

Across all developing countries, output in services has been increasing by more than 5 percent per year since 1995, so that the total value of services (in real terms after accounting for inflation) has increased 150 percent. In some countries, there is a particularly important shift toward more modern services such as software development, technical services (engineering and architecture), outsourced business processes (from insurance claims to transcribing medical records), and call centers, all of which create jobs and increase skills over time. Advances in technology and much deeper global connectivity have allowed developing countries to provide services to other countries as never before: developing countries accounted for 14 percent of global service exports in 1990; two decades later, the share had jumped to 21 percent.

How I Became a Quant: Insights From 25 of Wall Street's Elite by Richard R. Lindsey, Barry Schachter

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Albert Einstein, algorithmic trading, Andrew Wiles, Antoine Gombaud: Chevalier de Méré, asset allocation, asset-backed security, backtesting, bank run, banking crisis, Black-Scholes formula, Bonfire of the Vanities, Bretton Woods, Brownian motion, business process, buy low sell high, capital asset pricing model, centre right, collateralized debt obligation, corporate governance, correlation coefficient, Credit Default Swap, credit default swaps / collateralized debt obligations, currency manipulation / currency intervention, discounted cash flows, disintermediation, diversification, Emanuel Derman, en.wikipedia.org, Eugene Fama: efficient market hypothesis, financial innovation, fixed income, full employment, George Akerlof, Gordon Gekko, hiring and firing, implied volatility, index fund, interest rate derivative, interest rate swap, John von Neumann, linear programming, Loma Prieta earthquake, Long Term Capital Management, margin call, market friction, market microstructure, martingale, merger arbitrage, Nick Leeson, P = NP, pattern recognition, pensions crisis, performance metric, prediction markets, profit maximization, purchasing power parity, quantitative trading / quantitative finance, QWERTY keyboard, RAND corporation, random walk, Ray Kurzweil, Richard Feynman, Richard Feynman, Richard Stallman, risk-adjusted returns, risk/return, shareholder value, Sharpe ratio, short selling, Silicon Valley, six sigma, sorting algorithm, statistical arbitrage, statistical model, stem cell, Steven Levy, stochastic process, systematic trading, technology bubble, The Great Moderation, the scientific method, too big to fail, trade route, transaction costs, transfer pricing, value at risk, volatility smile, Wiener process, yield curve, young professional

Peter was outgoing and friendly and made an effort to get to know the quant research guys. We became friends and he was eventually a big influence on my decision to pursue quantitative trading. Quant Research and the Mathematics of Portfolio Trading I want to start with some general comments about how I view research in financial mathematics. I believe that one incredibly important application of quantitative research is in improving business processes. Many business units in finance are governed by rules of thumb and best practices that have never been fully analyzed. I believe this was certainly the case in program trading. There are undoubtedly many more problems that are not yet seen as problems in this light. At the time I joined Morgan Stanley, it was not really a research problem to ask whether there is a mathematically optimal way to trade portfolios.

From Airline Reservations to Sonic the Hedgehog: A History of the Software Industry by Martin Campbell-Kelly

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Apple II, Apple's 1984 Super Bowl advert, barriers to entry, Bill Gates: Altair 8800, business process, card file, computer age, computer vision, continuous integration, deskilling, Grace Hopper, inventory management, John von Neumann, linear programming, Menlo Park, Network effects, popular electronics, RAND corporation, Robert X Cringely, Ronald Reagan, Silicon Valley, software patent, Steve Jobs, Steve Wozniak, Steven Levy, Thomas Kuhn: the structure of scientific revolutions

Few corporate information systems departments were capable of installing ERP software without the assistance of external consultants. Indeed, it was estimated that the leading ERP package, SAP’s R/3, cost 5–10 times as much to install as the software itself. In the 1990s, the installation of ERP software became a huge new business for computer services and consulting firms, and they and the producers of ERP software grew symbiotically. The 1993–94 vogue for business process re-engineering encouraged firms to sweep away years of evolutionary growth in their software systems and replace them in one fell swoop. It happened that ERP software offered a better solution for wholesale re-implementation of a corporate software system than the less-well-integrated products of firms such as Dun & Bradstreet. The rise of ERP software was something of an unpredictable Darwinian process.


pages: 411 words: 136,413

The Voice of Reason: Essays in Objectivist Thought by Ayn Rand, Leonard Peikoff, Peter Schwartz

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affirmative action, Berlin Wall, British Empire, business process, cuban missile crisis, haute cuisine, invisible hand, Isaac Newton, laissez-faire capitalism, means of production, medical malpractice, profit motive, Ralph Nader, Ronald Reagan, The Wealth of Nations by Adam Smith, trade route, transcontinental railway, urban renewal, War on Poverty

“Since I can’t understand you, what do you expect me to do?” “I don’t know.” This policy rests on the notion that the content of one’s consciousness need not be processed. It is only a newborn infant that could regard itself as the helplessly passive spectator of the chaotic sensations which are the content of its consciousness (but a newborn infant would not, because its consciousness is intensely busy processing its sensations). From the day of his birth, man’s development and growth to maturity consists in his mastery of the skill of processing his sensory-perceptual material, of organizing it into concepts, of integrating concepts, of identifying his feelings, of discovering their relation to the facts of reality. This processing has to be performed by a man’s own mind. No one can perform it for him.


pages: 566 words: 163,322

The Rise and Fall of Nations: Forces of Change in the Post-Crisis World by Ruchir Sharma

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3D printing, Asian financial crisis, backtesting, bank run, banking crisis, Berlin Wall, Bernie Sanders, BRICs, business climate, business process, call centre, capital controls, Capital in the Twenty-First Century by Thomas Piketty, Carmen Reinhart, central bank independence, centre right, colonial rule, Commodity Super-Cycle, corporate governance, crony capitalism, currency peg, dark matter, debt deflation, deglobalization, deindustrialization, demographic dividend, demographic transition, Deng Xiaoping, Doha Development Round, Donald Trump, Edward Glaeser, Elon Musk, eurozone crisis, failed state, Fall of the Berlin Wall, falling living standards, Francis Fukuyama: the end of history, Freestyle chess, Gini coefficient, hiring and firing, income inequality, indoor plumbing, industrial robot, inflation targeting, Internet of things, Jeff Bezos, job automation, Joseph Schumpeter, Kenneth Rogoff, knowledge economy, labor-force participation, Malacca Straits, Mark Zuckerberg, market bubble, megacity, Mexican peso crisis / tequila crisis, mittelstand, moral hazard, New Economic Geography, North Sea oil, oil rush, oil shale / tar sands, oil shock, pattern recognition, Peter Thiel, pets.com, Plutocrats, plutocrats, Ponzi scheme, price stability, Productivity paradox, purchasing power parity, quantitative easing, Ralph Waldo Emerson, random walk, rent-seeking, reserve currency, Ronald Coase, Ronald Reagan, savings glut, secular stagnation, Shenzhen was a fishing village, Silicon Valley, Silicon Valley startup, Simon Kuznets, smart cities, Snapchat, South China Sea, sovereign wealth fund, special economic zone, spectrum auction, Steve Jobs, The Wisdom of Crowds, Thomas Malthus, total factor productivity, trade liberalization, trade route, tulip mania, Tyler Cowen: Great Stagnation, unorthodox policies, Washington Consensus, WikiLeaks, women in the workforce, working-age population

Today Monterrey is the quiet home to a striking array of companies that are applying high technology to the improvement of everything from lightweight aluminum auto parts to white cheese, tortilla-based prepared meals, and even cement. The late CEO Lorenzo Zambrano brought his Stanford training to the task of turning Cemex into the world’s most advanced cement company, transforming its signature product into what he liked to call, in Silicon Valley argot, a tech-based “solution.” Cemex has nine research labs, focused on everything from improving its business processes to developing stronger ready-mix concrete. In Colombia, the company has convinced the government to buy more expensive new cement that lasts longer, which ends up saving the country money on repaving its mountainous road network. Mexico’s central government recognizes the potential of Monterrey’s entrepreneurial culture to transform an economy still dominated by state monopolies, and it has contributed to some $400 million in new investments that have poured into the city’s research facilities since 2009.

Making Globalization Work by Joseph E. Stiglitz

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affirmative action, Andrei Shleifer, Asian financial crisis, banking crisis, barriers to entry, Berlin Wall, business process, capital controls, central bank independence, corporate governance, corporate social responsibility, currency manipulation / currency intervention, Doha Development Round, Exxon Valdez, Fall of the Berlin Wall, Firefox, full employment, Gini coefficient, global reserve currency, happiness index / gross national happiness, illegal immigration, income inequality, income per capita, incomplete markets, Indoor air pollution, informal economy, inventory management, invisible hand, Kenneth Rogoff, low skilled workers, manufacturing employment, market fundamentalism, Martin Wolf, microcredit, moral hazard, North Sea oil, offshore financial centre, oil rush, open borders, open economy, price stability, profit maximization, purchasing power parity, quantitative trading / quantitative finance, race to the bottom, reserve currency, rising living standards, risk tolerance, Silicon Valley, special drawing rights, statistical model, the market place, The Wealth of Nations by Adam Smith, Thomas L Friedman, trade liberalization, trickle-down economics, union organizing, Washington Consensus

President Jefferson, who as secretary of state was one of the original drafters of the 1793 Patent Act, envisioned patents being granted only to physical, useful inventions. When the 1952 law was passed, though, a congressional report said that "anything made by man under the sun" was patentable. Since then, there has been a vast expansion of what is patentable. In 1980, the Supreme Court, in Diamond v. Chakrabarty, ruled that genetically modified bacteria were patentable. Since then patents have been extended to business processes. See James Meek, "The Race to Buy Life," Guardian, November 15, 2000, available at wwwguardian.co.uk/genes/article/0,2763,397827,00.html; and the Center for the Study of Technology and Society, "Genome Patents," at www.tec soc.org/biotech/focuspatents.htm. The firm is based in Salt Lake City, Utah, and was co-founded by Walter Gilbert, who won the 1980 Nobel Prize in Chemistry for his contributions to the development of DNA-sequencing technology.


pages: 505 words: 127,542

If You're So Smart, Why Aren't You Happy? by Raj Raghunathan

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Broken windows theory, business process, cognitive dissonance, deliberate practice, en.wikipedia.org, epigenetics, fundamental attribution error, job satisfaction, Mahatma Gandhi, market clearing, meta analysis, meta-analysis, new economy, Phillip Zimbardo, placebo effect, science of happiness, Skype, The Fortune at the Bottom of the Pyramid, Thorstein Veblen, Tony Hsieh, working poor, Zipcar

Most of us can, of course, readily relate to the idea that being meaningfully busy is better than being meaninglessly busy. This is because we know, from personal experience, that we are happier doing something meaningful than doing something meaningless. The findings on flow (discussed in chapter 2B), for example, are entirely consistent with the idea that being meaningfully busy makes us happy. Implications of the Need to Be Busy: Process (vs. Outcome) as a Source of Happiness The fact that we are happier when we are busy than when not, and the fact that we are even happier when doing something meaningful—rather than meaningless—has a very important implication. It suggests that we don’t need to depend on outcomes for happiness—we could derive all our happiness from the process of working toward outcomes. We could, for example, derive happiness from preparing for an exam or from planning for a vacation.


pages: 518 words: 147,036

The Fissured Workplace by David Weil

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accounting loophole / creative accounting, affirmative action, Affordable Care Act / Obamacare, banking crisis, barriers to entry, business process, call centre, Carmen Reinhart, Cass Sunstein, Clayton Christensen, clean water, collective bargaining, corporate governance, Daniel Kahneman / Amos Tversky, David Ricardo: comparative advantage, declining real wages, employer provided health coverage, Frank Levy and Richard Murnane: The New Division of Labor, George Akerlof, global supply chain, global value chain, hiring and firing, income inequality, intermodal, inventory management, Jane Jacobs, Kenneth Rogoff, law of one price, loss aversion, low skilled workers, minimum wage unemployment, moral hazard, Network effects, new economy, occupational segregation, performance metric, pre–internet, price discrimination, principal–agent problem, Rana Plaza, Richard Florida, Richard Thaler, Ronald Coase, shareholder value, Silicon Valley, statistical model, Steve Jobs, supply-chain management, The Death and Life of Great American Cities, The Nature of the Firm, transaction costs, ultimatum game, union organizing, women in the workforce, Y2K, yield management

By 2000 an estimated 45% of janitors worked under contracting arrangements, and more than 70% of guards were employed as contractors.43 Cutting Deeper As the pressure to focus continued, business units within many corporations sought further ways to shed activities and reduce costs while protecting the parts of the business central to profitability. Management scholars and consultants promoted the idea of streamlining business processes that had, over time, become encumbered, slow, and wasteful. Companies had allowed many operations to become flabby, in this view, and were weighed down by internal processes that were often redundant, inefficient, quality-plagued, and unproductive. To compete more effectively, companies needed to strip their business practices to the core, analyze what the critical features of them should be, and rebuild them accordingly.


pages: 537 words: 144,318

The Invisible Hands: Top Hedge Fund Traders on Bubbles, Crashes, and Real Money by Steven Drobny

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Albert Einstein, Asian financial crisis, asset allocation, asset-backed security, backtesting, banking crisis, Bernie Madoff, Black Swan, Bretton Woods, BRICs, British Empire, business process, capital asset pricing model, capital controls, central bank independence, collateralized debt obligation, Commodity Super-Cycle, commodity trading advisor, credit crunch, Credit Default Swap, credit default swaps / collateralized debt obligations, currency peg, debt deflation, diversification, diversified portfolio, equity premium, family office, fiat currency, fixed income, follow your passion, full employment, Hyman Minsky, implied volatility, index fund, inflation targeting, interest rate swap, inventory management, invisible hand, London Interbank Offered Rate, Long Term Capital Management, market bubble, market fundamentalism, market microstructure, moral hazard, North Sea oil, open economy, peak oil, pension reform, Ponzi scheme, prediction markets, price discovery process, price stability, private sector deleveraging, profit motive, purchasing power parity, quantitative easing, random walk, reserve currency, risk tolerance, risk-adjusted returns, risk/return, savings glut, Sharpe ratio, short selling, sovereign wealth fund, special drawing rights, statistical arbitrage, stochastic volatility, The Great Moderation, time value of money, too big to fail, transaction costs, unbiased observer, value at risk, Vanguard fund, yield curve

The process of trying to ascertain the macro themes involves a variety of inputs, both qualitative and quantitative. This makes modeling the macro “algorithm” more challenging. However, we adhere to a very strict and logical process of modeling commodity market variables and the dynamics of equity supply chains. So the heavy modeling process really gets underway once the primary macro themes are determined. It is more a business process with a specific investment discipline and framework for assessing the fundamentals that drive our markets. Where many people think commodities have discrete supply and demand components, we have always tried to look at supply in the context of demand. The real goal is to figure out when a market will break out of the range of a balanced convenience yield for a given product, where a “convenience yield” is the benefit or detriment that accrues to the holder of a physical commodity as a function of relative inventory levels (see box on page 239).


pages: 515 words: 126,820

Blockchain Revolution: How the Technology Behind Bitcoin Is Changing Money, Business, and the World by Don Tapscott, Alex Tapscott

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Airbnb, altcoin, asset-backed security, autonomous vehicles, barriers to entry, bitcoin, blockchain, Bretton Woods, business process, Capital in the Twenty-First Century by Thomas Piketty, carbon footprint, clean water, cloud computing, cognitive dissonance, corporate governance, corporate social responsibility, Credit Default Swap, crowdsourcing, cryptocurrency, disintermediation, distributed ledger, Donald Trump, double entry bookkeeping, Edward Snowden, Elon Musk, Erik Brynjolfsson, ethereum blockchain, failed state, fiat currency, financial innovation, Firefox, first square of the chessboard, first square of the chessboard / second half of the chessboard, future of work, Galaxy Zoo, George Gilder, glass ceiling, Google bus, Hernando de Soto, income inequality, informal economy, interest rate swap, Internet of things, Jeff Bezos, jimmy wales, Kickstarter, knowledge worker, Kodak vs Instagram, Lean Startup, litecoin, Lyft, M-Pesa, Mark Zuckerberg, Marshall McLuhan, means of production, microcredit, mobile money, Network effects, new economy, Oculus Rift, pattern recognition, peer-to-peer lending, performance metric, Peter Thiel, planetary scale, Ponzi scheme, prediction markets, price mechanism, Productivity paradox, quantitative easing, ransomware, Ray Kurzweil, renewable energy credits, rent-seeking, ride hailing / ride sharing, Ronald Coase, Ronald Reagan, Satoshi Nakamoto, Second Machine Age, seigniorage, self-driving car, sharing economy, Silicon Valley, Skype, smart contracts, smart grid, social graph, social software, Stephen Hawking, Steve Jobs, Steve Wozniak, Stewart Brand, supply-chain management, TaskRabbit, The Fortune at the Bottom of the Pyramid, The Nature of the Firm, The Wisdom of Crowds, transaction costs, Turing complete, Turing test, Uber and Lyft, unbanked and underbanked, underbanked, unorthodox policies, X Prize, Y2K, Zipcar

,” August 24, 2015; https://en.rsf.org/russia-has-russia-gone-so-far-as-to-block-24-08-2015,48253.html, accessed September 25, 2015. 37. Scott Neuman, “China Arrests Nearly 200 over ‘Online Rumors,’” August 30, 2015; www.npr.org/sections/thetwo-way/2015/08/30/436097645/china-arrests-nearly-200-over-online-rumors. 38. GetGems.org, September 2, 2015; http://getgems.org/. 39. “Factom: Business Processes Secured by Immutable Audit Trails on the Blockchain,” www.factom.org/faq. 40. Interview with Stephen Pair, June 11, 2015. 41. Miguel Freitas, About Twister. http://twister.net.co/?page_id=25. 42. Mark Henricks, “The Billionaire Dropout Club,” CBS MarketWatch, CBS Interactive Inc., January 24, 2011, updated January 26, 2011; www.cbsnews.com/news/the-billionaire-dropout-club/, accessed September 20, 2015. 43.


pages: 405 words: 117,219

In Our Own Image: Savior or Destroyer? The History and Future of Artificial Intelligence by George Zarkadakis

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3D printing, Ada Lovelace, agricultural Revolution, Airbnb, Alan Turing: On Computable Numbers, with an Application to the Entscheidungsproblem, anthropic principle, Asperger Syndrome, autonomous vehicles, barriers to entry, battle of ideas, Berlin Wall, bioinformatics, British Empire, business process, carbon-based life, cellular automata, Claude Shannon: information theory, combinatorial explosion, complexity theory, continuous integration, Conway's Game of Life, cosmological principle, dark matter, dematerialisation, double helix, Douglas Hofstadter, Edward Snowden, epigenetics, Flash crash, Google Glasses, Gödel, Escher, Bach, income inequality, index card, industrial robot, Internet of things, invention of agriculture, invention of the steam engine, invisible hand, Isaac Newton, Jacquard loom, Jacquard loom, Jacques de Vaucanson, James Watt: steam engine, job automation, John von Neumann, Joseph-Marie Jacquard, millennium bug, natural language processing, Norbert Wiener, On the Economy of Machinery and Manufactures, packet switching, pattern recognition, Paul Erdős, post-industrial society, prediction markets, Ray Kurzweil, Rodney Brooks, Second Machine Age, self-driving car, Silicon Valley, speech recognition, stem cell, Stephen Hawking, Steven Pinker, strong AI, technological singularity, The Coming Technological Singularity, the scientific method, theory of mind, Turing complete, Turing machine, Turing test, Tyler Cowen: Great Stagnation, Vernor Vinge, Von Neumann architecture, Watson beat the top human players on Jeopardy!, Y2K

President Reagan’s ‘Star Wars’ initiative9 used complex operational research algorithms run on fast supercomputers to guide counter-attack weapons so effectively that the Soviet Union was rendered a military lame duck. The investment and interest in developing computing technologies in the West was not driven by the profound military applications of computing alone. The industry quickly realised the huge potential of this new technology in increasing productivity and automating business processes. The 1960s saw the development of business-specific computer languages (such as COBOL)10 that were applied in solving problems in finance and manufacturing. Hardware also developed in leaps and bounds, and by the early 1980s most businesses in the developed world used computers in various degrees. As electronics moved from vacuum tubes to solid-state transistors they started to become miniaturised.

The End of Power: From Boardrooms to Battlefields and Churches to States, Why Being in Charge Isn’t What It Used to Be by Moises Naim

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additive manufacturing, barriers to entry, Berlin Wall, bilateral investment treaty, business process, business process outsourcing, call centre, citizen journalism, Clayton Christensen, clean water, collapse of Lehman Brothers, collective bargaining, colonial rule, conceptual framework, corporate governance, crony capitalism, deskilling, disintermediation, don't be evil, failed state, Fall of the Berlin Wall, financial deregulation, Francis Fukuyama: the end of history, illegal immigration, immigration reform, income inequality, income per capita, intermodal, invisible hand, job-hopping, Joseph Schumpeter, Julian Assange, Kickstarter, Martin Wolf, megacity, Naomi Klein, Nate Silver, new economy, Northern Rock, Occupy movement, open borders, open economy, Peace of Westphalia, Plutocrats, plutocrats, price mechanism, price stability, private military company, profit maximization, Ronald Coase, Ronald Reagan, Silicon Valley, Skype, Steve Jobs, The Nature of the Firm, Thomas Malthus, too big to fail, trade route, transaction costs, Washington Consensus, WikiLeaks, World Values Survey

It helps spread the idea that things do not need to be as they have always been—that there is always, somewhere and somehow, a better way. It breeds skepticism and mistrust of any authority, and an unwillingness to take any distribution of power for granted. One of the best examples of all three revolutions simultaneously at work is the Indian outsourcing industry. Young, educated Indians who belong to the country’s burgeoning middle class have flocked to work at urban call centers and other business process outsourcing (BPO) companies, which in 2011 generated $59 billion in revenue and directly and indirectly employed almost 10 million Indians.39 As Shehzad Nadeem observed in Dead Ringers, his study of the impact of Indian call centers on their workers, “The identities and aspirations of the ICT [information and communications technology] workforce are defined increasingly with reference to the West. . . .


pages: 456 words: 123,534

The Dawn of Innovation: The First American Industrial Revolution by Charles R. Morris

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air freight, British Empire, business process, California gold rush, clean water, colonial exploitation, computer age, Dava Sobel, en.wikipedia.org, glass ceiling, hiring and firing, if you build it, they will come, interchangeable parts, Isaac Newton, Jacquard loom, Jacquard loom, James Hargreaves, James Watt: steam engine, John Harrison: Longitude, joint-stock company, lone genius, manufacturing employment, new economy, New Urbanism, On the Economy of Machinery and Manufactures, purchasing power parity, QWERTY keyboard, refrigerator car, Robert Gordon, spinning jenny, Stephen Hawking, The Wealth of Nations by Adam Smith, trade route, transcontinental railway, traveling salesman

Even that was more precise than any of Whitney’s contemporary contracts. al Prompting the reasonable complaint from a competitor, “I should not think of gitting a patent for . . . applying a trip to welding a gun barel any moure than plating a scythe or a hoe it seems to me that a strange fanatism has operated on sum peope for gitting patents for some simple things.” The complaint anticipates today’s controversies over software “business process” patents. The trip-hammer had been around a long time, so Waters appears to have patented the application to barrel welding, rather than the tool. am The frame arrangement described here was used for gun stocks. The original patent application shows a shoe last, a more compact shape, and is arranged differently. The application identified a variety of possible arrangements for different product types.


pages: 411 words: 114,717

Breakout Nations: In Pursuit of the Next Economic Miracles by Ruchir Sharma

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3D printing, affirmative action, Albert Einstein, American energy revolution, anti-communist, Asian financial crisis, banking crisis, Berlin Wall, BRICs, British Empire, business climate, business process, business process outsourcing, call centre, capital controls, Carmen Reinhart, central bank independence, centre right, cloud computing, collective bargaining, colonial rule, corporate governance, crony capitalism, deindustrialization, demographic dividend, Deng Xiaoping, eurozone crisis, Gini coefficient, global supply chain, housing crisis, income inequality, indoor plumbing, inflation targeting, informal economy, Kenneth Rogoff, knowledge economy, labor-force participation, labour market flexibility, land reform, M-Pesa, Mahatma Gandhi, market bubble, megacity, Mexican peso crisis / tequila crisis, new economy, oil shale / tar sands, oil shock, open economy, Peter Thiel, planetary scale, quantitative easing, reserve currency, Robert Gordon, Shenzhen was a fishing village, Silicon Valley, software is eating the world, sovereign wealth fund, The Great Moderation, Thomas L Friedman, trade liberalization, Watson beat the top human players on Jeopardy!, working-age population

That’s a very high urbanization rate for a nation with an average income of only $2,500, and because the concentration of people and business drives growth, it’s a big economic plus. The Philippines also has some basic advantages over Indonesia—including a well-educated English-speaking population. For three decades it squandered those advantages, but there are signs of a turnaround, the most dramatic being the rise of the Philippines as a rival to India in “business process outsourcing”—the industry that provides the operators who answer calls for customer service at almost any major global company. Call centers did not exist in the Philippines a decade ago, and now it’s a $9 billion industry employing 350,000 people. These centers are starting to open outside metro Manila and pop up all over the islands of the Philippines, to the point that some analysts think it may turn into another successful case of Southeast Asian archipelago capitalism.


pages: 468 words: 233,091

Founders at Work: Stories of Startups' Early Days by Jessica Livingston

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8-hour work day, affirmative action, AltaVista, Apple II, Brewster Kahle, business process, Byte Shop, Danny Hillis, don't be evil, fear of failure, financial independence, Firefox, full text search, game design, Googley, HyperCard, illegal immigration, Internet Archive, Jeff Bezos, Maui Hawaii, Menlo Park, nuclear winter, Paul Buchheit, Paul Graham, Peter Thiel, Richard Feynman, Richard Feynman, Sand Hill Road, side project, Silicon Valley, slashdot, social software, software patent, South of Market, San Francisco, Startup school, stealth mode startup, Steve Ballmer, Steve Jobs, Steve Wozniak, web application, Y Combinator

Did you always add new features based on user feedback? Newmark: When it comes to features visible from the outside, yes. Internally, we figure out on a continuous basis . . . we figure out what tools we need, and then we do them. That’s working to this day, because it’s the job, for example, of customer service to figure out how they can do their jobs better and then to tell tech what they need. This is business process reengineering, which companies used to talk about a lot in the late ’80s, but usually didn’t follow through. Livingston: Did you have investors knocking at your door, offering you money? Newmark: They started in ’99, and we had a flurry of that last year. That’s how I have some idea of how much I stepped away from. Livingston: When they first offered you money, were you tempted at all? Newmark: Yes.


pages: 666 words: 181,495

In the Plex: How Google Thinks, Works, and Shapes Our Lives by Steven Levy

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23andMe, AltaVista, Anne Wojcicki, Apple's 1984 Super Bowl advert, autonomous vehicles, book scanning, Brewster Kahle, Burning Man, business process, clean water, cloud computing, crowdsourcing, Dean Kamen, discounted cash flows, don't be evil, Douglas Engelbart, El Camino Real, fault tolerance, Firefox, Gerard Salton, Google bus, Google Chrome, Google Earth, Googley, HyperCard, hypertext link, IBM and the Holocaust, informal economy, information retrieval, Internet Archive, Jeff Bezos, Kevin Kelly, Mark Zuckerberg, Menlo Park, optical character recognition, PageRank, Paul Buchheit, Potemkin village, prediction markets, recommendation engine, risk tolerance, Sand Hill Road, Saturday Night Live, search inside the book, second-price auction, Silicon Valley, skunkworks, Skype, slashdot, social graph, social software, social web, spectrum auction, speech recognition, statistical model, Steve Ballmer, Steve Jobs, Steven Levy, Ted Nelson, telemarketer, trade route, traveling salesman, Vannevar Bush, web application, WikiLeaks, Y Combinator

One day in 2005, Marissa Mayer was trying to explain why the looniness of Google was actually the crazy-like-a-fox variety and not the kind calling for straitjackets. Responding to the company’s ventures beyond search, outsiders had been charging that Google was out of control, tossing balls into the air like a drunken juggler. And that was before Google decided to remake the energy industry, the medical information infrastructure, the book world, radio, television, and telecommunications. She conceded that to an outsider, Google’s new-business process might indeed look strange. Google spun out projects like buckshot, blasting a spray and using tools and measurements to see what it hit. And sometimes it did try ideas that seemed ill suited or just plain odd. Finally she burst out with her version of the corporate Rosebud. “You can’t understand Google,” she said, “unless you know that both Larry and Sergey were Montessori kids.” “Montessori” refers to schools based on the educational philosophy of Maria Montessori, an Italian physician born in 1870 who believed that children should be allowed the freedom to pursue what interested them.


pages: 1,156 words: 229,431

The IDA Pro Book by Chris Eagle

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