Black swans are important events, either good or bad, that are highly improbable but happen nonetheless. The idea of using black swans as a metaphor for weird events has its origins in the 1600s when the discovery of the first non-white swan was made in Australia. Asteroids hitting the earth and wiping out dinosaurs or Apple making the iPod might be considered black swans.
I probably should have known about the term black swans, as it was popularized in The Black Swan: The Impact of the Highly Improbable, a book published last year by mathematics professor and trader Nassim Nicholas Taleb about why it is hard to predict the future. For those of us reporters and CIOs who prize our ability to be in control of what we are doing, black swans offer particular challenges, as by definition they fall outside the status quo. Taleb contends that human nature being what it is, we base our reactions on what we experience and often overemphasize these black swans, believing erroneously that they will repeat. We see someone win the lottery and think maybe it’s a good idea to try it for ourselves-foolish, but we can’t help thinking this way.
At EmTech08, the expression was used by Sun founder-turned-venture capitalist Vinod Khosla to explain his investing approach and as prelude to a lengthy promotion of the renewable energy companies backed by Khosla Ventures.
Market predictions for renewable energy wield little clout in Khosla’s investment decisions. The truth about many forecasts is that they turn out to be false, Khosla said, pointing to long-term price predictions for oil and for the U.S. market for cell phones, to name two forecasts that were very wrong, exponentially so in the case of cell phones. Khosla would rather not have a forecast and instead “be prepared for everything.” Forecasters, “mostly economists,” he dissed, use yesterday’s technology to predict the future.
The failure of the market to accurately predict the market offers an important lesson for non-economists like him and fellow technocrats in the audience, Khosla said. Rather than worry about predictions for the future-invent it. Indeed, technology is a classic black swan-generating activity, he said.
Black swans aside, Khosla employs some pretty familiar tangibles to measure whether a renewable energy technology is worth his dough. What matters is cost (it had better be cheaper than fossil fuels), scalability, low adoption risk. So, in his view electric cars are irrelevant unless new battery technology comes to fruition, biodiesel fuel is no good unless algae technology is perfected, food ethanol takes too much land to produce, wind and photovoltaics are useless unless we figure out a way to store that energy … and so on. You can read about Khosla’s companies and more about his investing philosophy at KhoslaVentures.com.]]>
According to a study published Wednesday by the Pew Internet and American Life Project, of the 2,144 adults surveyed this spring, 96% used email, the Internet or cell phones, and 80% believed that the technologies have improved their ability to do their jobs.
But the flipside is 46% said these devices increased the demands that they work more hours, and 49% said the technologies make it harder to disconnect from work even in their off-hours. Half of the respondents who were employed and use email said they check their work email on weekends, and 22% said they check “often” on the weekends.
Now, whether or not this qualifies as an invasion on one’s downtime depends, I think, on what people’s motivations are for doing so. I tend to check my work email at least once every evening after I’ve left the office, and at least once during the weekend. I’ve never been told I’m required to do so, but I do it anyway, probably because I don’t see it as making more work for myself – quite the opposite, in fact.
I find that reviewing and replying to emails from home (or from my phone) in a timely manner makes my mornings a lot more bearable. I come into the office feeling like I’ve gotten a good running start on my morning’s activities and can focus on those, rather than on the constant cycle of reviewing, replying and deleting.
Have I ever stressed myself out in my off-hours due to my email checking? Sure, it’s happened, and I’ve cursed myself for not being able to fully unplug from the office. And I guess the extra email time does technically translate to “working more hours” on top of my normal office hours. But doing so makes those office hours a lot more productive and enjoyable.
Whenever I meet with IT executives, I always ask about their career trajectories. In Cotter’s case, like so many other CIOs I meet, she did not set out to be the chief executive for IT. A love of math led her into programming, and from there she discovered a talent for not only IT but also management — and an aptitude for finance under one of business’s toughest bosses.
You can read Cotter’s recounting of how she earned her CIO stripes after the jump. And be sure to check out her perspective on security and privacy on SearchCIO.com.
SearchCIO.com: Women CIOs are still a rare breed. How did you get into IT and come to be a CIO?
Cotter: Well, I majored in math in college and kind of gravitated to IT. I started out as a programmer and really liked the very deep technical aspects of programming, reading core dumps and analyzing how macros worked and that sort of thing. But I also liked being able to apply that work to a real life situation.
I guess my career grew the way most people’s careers do. I had some wonderful opportunities to try out different areas of skill. I found out I was a pretty good application software designer. And then I moved into a management position and found out I was pretty good at managing people working in technical areas.
Then I was working for a GE company in the time of Jack Welch. We were not No. 1 or No. 2. [A Welch rule.] I was in insurance at the time, and I had the wonderful — and I say this now; it did not seem so at the time — the wonderful experience of helping put the company out of business. That meant selling off the lines of business to other companies, because we had obligations to policy holders, and then when that was done, helping to sell off equipment, and to help employees find other positions. It was a great learning experience. That’s how I got into health care. When I was at GE, I enrolled in their financial management program. GE has a very special way of doing everything financial. It’s a two-and-half-year program. You keep your full-time job but you go to classes taught by GE professionals.
So I had done that program, and I had worked at financial systems while I was there, and when we were closing down this company, the CFO there had gone to this little healthcare company called Rhode Island Group Health Association (RIGHA) which was a brand new staff model HMO. He called me and said, ‘I am working here and this is a place where I think you will love the people and would love the work.’ I went there for an interview and I did fall in love with the people there, who were so committed to taking care of patients. It was an organization I knew I could believe in. It was small. Their IT staff was tiny and what they were trying to do was ambitious. I went there as a director of IT and had the opportunity to really get in on the ground floor of putting in a claims system and a pharmacy system and the very very beginnings of an electronic health information. I was fortunate to be able to hire some people that I had known at the GE company because they were real pros. We all just did everything, all of us did everything as a team, to just keep that system up and running. Then RIGHA ran into some difficult times financially and they were taken over by Harvard Community Health Plan.
To make a long story short, at Harvard Community Health Plan I was director of their insurance and financial systems at their main office and I kept my job at what became the New England division, which was the former Rhode Island Group Health Association. So I had two jobs, two bosses and I was a single parent. This was in the late 1980s, early 90′s. There was a day when I dropped my son off to summer camp and drove up to Boston. The only problem was I dropped him off a week early. Talk about a wake up call. So the following Sunday I saw an ad in the paper for the director of information technology at the Miriam Hospital.
I applied, and I was offered the job. I got a team together, started to work with the physicians very closely to involve them in the team planning, and we did a terrific strategic plan for IT that was very well-received. We were ready to begin work on it and did start and then — I think I had been there 18 months – in 1992, when the Miriam Hospital announced that it was merging with Rhode Island Hospital to form a new company called Lifespan. Talk about being at the right place at the right time! One of the benefits that the hospitals saw in merging was being able to combine their IT programs because both hospitals thought that IT was critical to the future and they thought they could do better by combining forces around IT. There was a CIO at Rhode Island Hospital, so we started to work together and we did a brand new strategic plan for the new corporation. I had just had the experience of doing the strategic plan at the Miriam and had learned a lot. I like doing planning, strategic planning in particular. I really did a lot of work on the plan and knew it inside out by the time I was finished.
About this time, Lifespan decided to post the CIO job and do a national search. I applied and was fortunate enough to get the position. And Lifespan grew; we added more hospitals. I was able to recruit some wonderful staff from those hospitals. We had an open arms policy. In your IT career how many times do you find yourself in that position, where you’re at a new company, they’re willing to invest in a new plan and you get to execute?]]>
BPM newest SaaS deliverable — A growing number of SaaS providers are using BPM system platforms to make changes to their products more efficiently. CIOs can take advantage of this to get more configurable apps.
Identity management begins with the roles people play — Roles-based access control starts with the business, but some new technology that automates and audits it helps, too.
Energy credits offered as part of IBM’s green initiative — IBM’s green push includes tapping utilities to educate CIOs and other IT managers and encourage them to lower energy costs.]]>
The layoffs in the wake of the Wall Street quake will top 100,000, according to news reports: Lehman, more than 20,000 people; Bear Stearns, 7,000; thousands at Merrill Lynch after its sale to Bank of America. At some point, the damage has to hit IT, no?
I called a couple of analysts to get a sense of what the big research houses think will be the fallout for IT, on the employment numbers, which have proved so resilient, and IT budgets.
Ken McGee, who does the big-picture IT spending stuff for Gartner Inc., sounded a bit exasperated when asked about the meltdown’s impact on tech spending. “You see not-cool heads prevailing, with people believing the doom and gloom,” McGee said. Yes, IT budgets will be lower next year than the growth rates of this year or the year before.
“But you should also know that we are going to advise clients to have a growth budget prepared and that they keep it in their hip pocket, because these periods tend not to last that long, and part of 2009 could be a return-to-growth period. So we want our clients to be prepared when that happens,” he said.
What about this crisis being categorically different from other downturns? A once-in-a-century event, as former Federal Reserve chairman Alan Greenspan said?
Hype, McGee said. Take a listen:
“I think there is great danger when you have the center of the financial world reside within the same center as the media world. If you go back and back and searched enough I think you’d find that similar notions were presented in 2000 and 2001. … The fact remains that we have a smaller contingent of people working in the former Bear, the former Merrill, the former Lehman, but they have not entirely gone away. They have not entirely evaporated. So, these statements of terrific downturns in IT do not seem to be supported by the facts. And the point should be made that as horrible as this year has been – business-wise and economic-wise, the fact remains that IT spending did grow this year,” McGee said. “A withdrawing tide does not lower all boats at the same rate.”
Gartner has the clientele to prove it.
“We haven’t found one client, not one, who has cancelled all their IT projects for this year,” he said. “So, clearly the spending is down, but the IT vendors continue to do well. And if anything they have a common mantra, ‘Thank God for the developing world.’”
Ellen Carney, who covers banking and insurance IT spending for Forrester Research Inc., also doesn’t see the latest events on Wall Street as having a big impact yet on tech spending numbers, pointing to –wow! – IT’s fiscal discipline. It seems that while the traders and lenders were playing fast and loose, CIOs were minding their stores.
“The interesting thing, especially with the investment banks, is that they have really strong vendor management organizations. Even in the good times, they aggressively manage their vendors, the rates, the concessions they extract from them,” Carney said.
She said CIOs at financial service companies have been aggressively cutting spending all year, reminding me of the Forrester research published earlier this month showing that 49% of IT shops in the financial services sector cut their budgets this year. That was the highest percentage of all the sectors responding to the poll. A lot of IT money has gone to improving productivity in banking, she said, and the employment rolls show that. “The banks have been shedding heads for a while now, quietly and now not-so quietly.”
And while overall IT budgets in financial services might be down next year, CIOs can expect plenty of money allocated to compliance as more regulations come barreling down the pike. The current compliance environment for financial services, pretty onerous compared with other industries, is going to look like a walk in the park compared with what’s coming, Carney warned.
As for IT people who have lost their jobs in the past few weeks, she doesn’t expect to see them waiting in long unemployment lines.
“All these really smart IT people gone from Lehman Brothers — it’s a great opportunity to pick up some talented people,” she said, but … “I don’t think we’ve seen the other shoe drop in the banking sector.”
Gartner’s McGee was unwilling to pronounce the layoffs a silver lining for other businesses, but he said he expects the current situation will be nothing like that in 2000 and 2001, “where IT workers were pretty much savaged.”
Let’s hope they’re right. Maybe the optimists have a point. This morning, Oracle reported profits up 28% in the first quarter, on an 18% jump in revenue. Somebody’s spending.
Give us the 411: We’d love to hear directly from IT people at Bear Stearns, Merrill, Lehman, AIG, Washington Mutual … about how they’re faring. Email me at email@example.com.]]>
VP candidate Palin had her “firstname.lastname@example.org” Yahoo! e-mail account hacked yesterday and some of its contents posted online. The group, which billed itself “Anonymous,” supposedly posted some of her private communications to expose what appeared to be her use of a personal account for government business. This included personal photos, the contents of several messages, the subject lines of dozens of e-mails and Palin’s e-mail contact list.
Palin has been criticized for using a personal e-mail account to conduct state business. An Alaska activist has filed a Freedom of Information Act request seeking disclosure of e-mails from another Yahoo! account Palin used, email@example.com.
Michael Allison, chief executive of the Internet Crimes Group, a private company specializing in Internet security, said the hackers may have accessed Palin’s account by using publicly available information to guess her password, or by using a program to capture her keystrokes. A hacker also might have sent a forged e-mail to her account tricking her into revealing her own password.
Of course, I must start by commenting on the immaturity of these hackers. You can dislike a candidate all you want, but don’t hack into his or her e-mail account. Apparently, it’s been known for months that Palin uses Yahoo! accounts to conduct government business. So what, really, do you accomplish by posting some apparently-innocuous messages online? If anything, it just drums up sympathy for Palin.
I’m left wondering: was there any good reason for Palin to be using Yahoo! for official business when she has a more properly secured e-mail address through her work? I don’t see it. Like most large organizations, I’m sure the Alaska state government must have a VPN or other such protocol in place to allow her to access her e-mail remotely. Would you be as brazen about transmitting business information as she has been? This strikes me as another example of Palin’s inexperience and/or overt flouting of the rules. I wonder if those in charge of IT at the White House are already having nightmares over the security snafus they may face if McCain and Palin are elected.
Here’s my bottom line: if Sarah Palin can’t be bothered to rely upon her secure, official e-mail address for conducting state government business, how can we feel confident that she’s going to properly protect information related to national security? I don’t want to live in fear that nuclear war codes are floating around through Yahoo!]]>
The required reading list (and one movie) is compiled by former Regional Leadership Forum participants, many of them now CIOs, with the aim of “promoting leadership development” among the incoming class, says Bob Rouse, RLF program director and professor of computer science at Washington University in St. Louis.
“The RLF book list provokes self-discovery and promotes the emergence of authentic leadership styles in our students,” Rouse said. “Each year, when tasked with developing this list, we search for books that will inspire, leading to the creation of a personal and unique management approach.”
Your leadership development may be fully formed by now, but it never hurts to be aware of what your peers consider seminal texts for being an effective CIO. And, you know, we may be in for tough times in the coming months. Hunkering down with a book by a writer above the fray of current events might offer some welcome and worthy escape. Let us know what you think of the list – and what on it you’ve read. Maybe we can start an online book club of IT pros and your humble online reporter.
For more on the Regional Leadership Forum program, now in its 15th year, see my interview with Rouse.
RLF 2009 Book List (Title, author)
•1. How to Read a Book, Mortimer J. Adler and Charles Van Doren
•2. Brain Rules, John Medina
•3. The Heart of Change, John P. Kotter and Dan S. Cohen
•4. The Extreme Future, James Canton
•5. First, Break all the Rules, Marcus Buckingham and Curt Coffman
•6. Leadership Passages, David L. Dotlich, James L. Noel and Norman Walker
•7. Made to Stick, Chip Heath and Dan Heath
•8. Leadership Is an Art, Max DePree
•9. Man’s Search for Meaning, Viktor E. Frankl
•10. The Post American World, Fareed Zakaria
•11. True North, Bill George
•12. Gandhi (participants buy or rent this movie)
•13. Working with Emotional Intelligence, Daniel Goleman
•14. The Theft of the Spirit, Carl Hammerschlag
•15. The Nibble Theory and the Kernal of Power, Kaleel Jamison
•16. Overcoming the Five Dysfunctions of a Team, Patrick M. Lencioni
•17. Improv Wisdom, Patricia Ryan Madson
•18. The Prince, Niccolo Machiavelli
•19. Orbiting the Giant Hairball, Gordon Mackenzie
•20. Managing Transitions, William Bridges
•21. Creating the Good Life, James O’Toole and Walter Isaacson
•22. Crucial Conversations, Kerry Patterson, Grenn Joseph, Ron McMillan, Al Switzler
•23. Leadership Moment, Michael Useem
•24. The Zen of Listening, Rebecca Z. Shafir
•25. Synchronicity: The Inner Path of Leadership, Joseph Jaworski
•26. A Leader’s Legacy, James M. Kouzes and Barry Z. Postner
•27. Two Old Women, Velma Wallis
•28. The Heart Aroused, David Whyte
•29. The Penguin State of the World Atlas, Dan Smith
•30. Speed Lead, Kevan Hall
•31. The Pearl, John Steinbeck]]>
Appearing on a KTRS Radio show in St. Louis Tuesday, Carly Fiorina, the former Hewlett-Packard CEO turned John McCain economic advisor, was asked whether Sarah Palin could run her old company, and she responded “no.” Cue the headlines: “PALIN COULDN’T RUN A MAJOR COMPANY.”
“But that’s not what she’s running for,” Fiorina quickly added. “Running a corporation is a different set of things.”
In a follow-up interview, Fiorina
jammed her foot in deeper qualified her remarks. “I don’t think John McCain could run a major corporation, I don’t think Barack Obama could run a major corporation, I don’t think Joe Biden could run a major corporation.”
“But, on the other hand, a major corporation is not the same as being the president or the vice president of the United States. It is a fallacy to suggest that the country is like a company. So, of course, to run a business, you have to have a lifetime of experience in business, but that’s not what Sarah Palin, John McCain, Joe Biden, or Barack Obama are doing.”
Triggering this query from the Obama campaign: “If John McCain’s top economic advisor doesn’t think he can run a corporation, how on Earth can he run the largest economy in the world in the midst of a financial crisis?”
Personally, I find it arrogant (not to mention incredibly dumb) to say that your candidate and his vice president couldn’t run a company when you’re asking people to vote with confidence that they can run an entire country. What was she thinking? Does she think being a CEO is more difficult than being president of the United States? Are different skills sets required for running a country and running a multibillion-dollar corporation?
I don’t have it out for Fiorina. I just think someone who was fired after a highly visible merger went sour, stock prices plummeted and thousands of employees were laid off should think twice making comments about who would and wouldn’t be qualified to run her former company — or the country. I personally don’t want John McCain or Sarah Palin trying to run a company — or our country — either, but Fiorina’s comments are like the kettle calling the pot black.
And, on that note, I wonder if Fiorina is the one behind McCain’s recent assertion that “the fundamentals of our economy are strong, but these are very, very difficult times.”
Yeah, tell it to Wall Street.]]>