Weeknote 206: cashflow

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Things I have learned this week:

- interesting start-ups seem to come out of anywhere but Shoreditch (notably http://wearebeem.com/, http://buyerdeck.com/ and http://pinipa.com/)
– RBS’s credit card has its very own online service (who knew! Been using their online banking for as long as it’s been around and I didn’t)
– Sir Humphrey is alive and well
– Twitter is just such a bloody marvellous place for conversation
– The Digital Architecture thing might have its first client
– Holocracy is almost certainly not the answer

Next week: me, appearing at the Apple Store. Yes, really. Me. At the Apple Store.

The one thing that all LinkedIn all-time top ten posts have in common

In Dan Pink’s wonderful book To sell is human there is a chapter that describes six ways to pitch an idea, a product or even yourself.

The one that I found most interesting was what he called the Subject Line Pitch. Imagine the best email subject line in the world, and Pink argues it will contain three key elements;

  • utility – that is, it’s immediately obvious that it has relevance to the intended recipient
  • curiosity – it’s relevant to me, but there is an air of intrigue which means I’ll open it
  • ultra-specificity – somehow I know how much effort whatever it is will take me

I’m not sure that I’ve seen this much in email subject lines over the years. If ever. But the internet is rife with this structure, and by golly it seems to work. Witness the top ten all time LinkedIn posts. The headline for every single one of them follows Pink’s subject-line format.

Pretty strong evidence for the subject line pitch don’t you think?

Big data: The tyranny of the past

#HR needs to stop reporting and start predicting”

- Michael Carty, twitter.com/mjcarty

The quote above from Michael on Twitter this morning (you can see the full thing here https://twitter.com/MJCarty/status/493812100138287104) got me thinking. It mostly got me thinking about how I seem to be developing a particular breed of Big Data iconoclasm these days.

The reason Michael’s tweet particularly got under my skin was because of the way in which it honed into what I believe to be the central marketing fallacy of the whole Big Data showreel. Let’s make it clear – lots of data gives you the ability to examine the past in increasingly minute detail. Maybe even the present. It does not, and let me repeat that, does not give you a magical window into the future.

Why am I becoming so entrenched in these views? Is it just the signs of an increasingly belligerent and grumpy old man? Possibly, but let me post-rationalise for you anyway.

Firstly, I lived through the era of data warehousing in the late 1990s into the last decade. Every time I see somebody painstakingly creating a management “R/A/G” report by hand-tinting cells in a Powerpoint table, I know that data warehousing didn’t work.

The volumes of data involved in data warehousing were MIcroSD-card sized in comparison to the data sets being talked about in the realm of Big Data. But the reason data warehousing didn’t work isn’t because there wasn’t enough data… in fact, even at the scale of aggregation of data involved in those days, the data was getting too much for many people to get their heads around. The reason data warehousing didn’t particularly work was because people didn’t change their behaviours. If you passionately believe in something you seek out data that supports your view and you dispel data that doesn’t – this is a psychological trick known as selection bias

But was there data to support the implementation of data warehousing in the first place? Yes – and it was mostly made up. Oh how many time I heard (and even retold) the story of beer and nappies in a supermarket? It was loosely based on some facts, but was a story as much as anything else in the fiction aisle.

Step forward to the present day, and there are a whole bunch of psychological biases and tricks at play when it comes to Big Data. The first is the deep-seated human need to reduce ambiguity through predicting the future. This has been explored at great length by Dan Gardner in his book Future Babble, and also by the Freakonomics team in this podcast.  We listen to those who claim to see into the future because they reduce down our own uncertainty. Big Data is just the latest in that long trend that goes back to the Oracle at Delphi and beyond.

Not only do we listen to those who predict the future, but those who occasionally get it right get great plaudits – this is known as survivorship bias and it’s a bit like asking a lottery winner about advice on how to win the lottery (actually we kind of do this – witness the signs up in some lottery ticket vendors proclaiming how many winners they’ve had…). Looking at success stories of prediction without looking at all of the failed predictions is alluring, but nonsensical.

Now actually Big Data might be quite good at predicting the future (most of the time) in comparison to humans because Big Data will predict based on trends. If we could put the issue of selection bias aside, that then might make for better decision making. Except when the unexpected occurs at which point Big Data extrapolating trends will fall on its backside.

And here’s the other big challenge for Big Data – that it’s great at spotting correlations but does nothing to understand causality. And that’s a big issue, as Tim Harford eloquently explains in this article in the FT. A lot of the data driven decision-making so enamoured of the likes of Amazon and Google ignores concepts of causal links. Relying on a correlation by building a business around it without understanding  why it occurs is a very risky game.

Now, having vented my spleen, is there any use for Big Data? Well, sure. Our ability to process and interrogate massive data sets as a result of the consequences of Moore’s Law has some fantastic possibilities – from genome research to machine translation.  But if something like “making better business decisions” didn’t work with smaller data, I’m very skeptical that it will work when more data is pumped into the process. And I’m even more skeptical when it’s thought Big Data can do actual magic.

As a final thought, when considering Big Data, here’s an alternative lens to look through. There are many Cloud-based big data providers. They charge for their services based on a combination of how much processing they do, how much data they store, and how much data they pass into and out of their systems. You don’t need Big Data analytics to see what a compelling business case Big Data is for those companies…

The power of authority

stanley_milgramI got into an interesting discussion last week about an incident in a friend’s local supermarket. An elderly neighbour had locked herself out of her house, and in a state of distress went to the supermarket (a small branch of one of the massive chains) to ask to use their telephone. The request was flatly refused.

My friend couldn’t understand how the supermarket staff could be so cruel and callous. My thoughts, having worked many years ago for a supermarket, was that that was utterly expected in an organisation that used such draconian process-centred management. “Oh, but we need processes.” said my friend…

A few days later I was reading Will Storr’s intriguing book The Heretics and was reminded of Stanley Milgram’s iconic social psychology experiments in the early 1960s into how authority leads to many people doing things that would be completely unacceptable to them and others otherwise. The power of uniform, the power of the teacher… and then I suddenly realised, the power of organisational process.

In my time working in large-scale organisations I’ve spent much of my time pretty much baffled. Baffled by the stupidity of so much that goes on. Baffled by the dehumanised nature of so much that goes on. Baffled by the sometimes near psychopathic behaviours. But authority in organisations, whether vested through the power of management rank, or by the dehumanised power of process, is Milgram’s experimentation writ large.

And that power is immense. I like to think of myself as someone who is fairly happy with challenging the status quo. I’ve had former bosses who have gone on public record to verify that. And yet, when push comes to shove, I’ve done things at work that I personally found morally unacceptable because the process-pressure and peer-pressure to conform was too great to withstand.

Whilst there is much talk around at the moment about how to create “manager-less” organisations, even those movements seem to still put great faith in the idea of rules and regulations – take the Holocracy concept, for example, which bills itself as “…is a comprehensive practice for structuring, governing, and running an organization“. That sounds as good a culture for the fermenting of Milgram-esque compliance as any traditional organisation.

Is this a big deal? Am I just showing my soft inner-liberal? Well, maybe. But when a distraught grandmother is turned away from an outpost of a massive multinational, don’t be surprised. And even more, don’t say that the poor sod at the end of that chain of command “should have used their initiative”. The power of authority is very, very hard to disobey.

Career planning

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About four years ago I decided to take my career on a new path. I had spent much of the preceding two decades working in IT of one form or another, but needed to change.

In my early thirties I’d set myself the goal of becoming a CIO by the age of 40. When I was interviewed for a feature about me by CIO Magazine just before my 40th birthday I figured I’d hit that target.

The question then became “Now what?”. Continuing down a CIO-career meant either doing the same job again at a larger scale, or stepping down a position or two to work my way up in a really big organisation. Neither sounded particularly appealing.

But there was more of an existential crisis going on as I thought about what should happen next. Having spent some time working to deliver Cloud-based services, and having been aware for some time that consumer technology was fast outpacing that in the world of business, it struck me that the world of IT was going through a profound and irreversible change. The CIO/IT path was one that not only looked repetitive, but also one where the scope for doing things that would keep me interested would diminish over time too.

So I took a leap – first to spend some time working on the supplier side of the industry with Microsoft, and more recently under my own steam. My career aims have now become much less precise, and much longer term.

I’ve been thinking about all of this a fair bit recently, as next week I’ve been invited to host an event taking place at the Regent Street Apple Store being run by FileMaker - the now Apple-owned database company. Anyone who has worked in a mixed Apple & PC environment over the years may well have come  FileMaker – and if that time was in the late 90s it might well be with gritted teeth.

These days, however, multi-platform is the norm not the exception, especially for smaller businesses where PC, Mac, Android and iOS will probably all intermingle. That’s the segment of the market that FileMaker appear to be targeting.

But why all the career reminiscing? Well, the event on Tuesday 5th will be talking to people who have become FileMaker developers, and so in turn have taken something of a different career path. Some come from “proper” IT backgrounds, some don’t. Most are working with small- or medium-sized businesses, some in house, some as service providers. All of them are doing things that are interesting, and providing value to their clients.

When I was a lad (which is becoming an increasingly distant memory) you could work your way up in IT. I myself started doing photocopying, migrated into photocopying and stapling, and from there was able to get a job on an IT helpdesk. a few years in the world of service support gave me enough insight to start to work in development, then into development management and so on.

Today, that kind of route is probably still possible, but as outsourcing and software as a service and off-shoring and whatever take their place, that well-rounded experience becomes harder to get. And one thing that I’m certain of is that understanding how people use technology, rather than just the technology per se, will become the skills of greatest value.

I’m interested to hear next week if the FileMaker developers are, though their backgrounds, their choice of tools and the clients they work for, are achieving that (and, at the same time, finding purposeful and meaningful work in their careers).

Full disclosure: FileMaker are paying me to host the event next week. All of the words above, though, are mine.  As they will be on the evening itself.

You can come along to the event on Tuesday 5th August by registering at https://www.apple.com/uk/retail/regentstreet/
(scroll half-way down the page to the Upcoming Store Events section and filter by “Events”)

Bertie Day

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Today marks the 101st anniversary of my grandfather’s birth. It also marks the end of the first year of my foray into the world of entreprenuerism.

A year down, and it has to be said that it’s been hard. I was utterly over optimistic about how and where clients would come from, and although I am now bringing in revenue, it’s a long way from where I was predicting this time last year. But I’ve built on an already strong network, and have pivoted wildly as I work out what’s likely to work and what’s not.

If I were to be offered the “perfect” full-time job tomorrow, would I take it? Probably, yes. Whilst the start-up life is thrilling and ever-changing, the uncertainty that it brings places a huge load onto family life. Will I have to take a full-time job? We’ll see, but signs are looking more positive (but that might just be me suffering from sunk-cost fallacy).

Am I closer to my goal? Am I doing “stampable” projects? Well, not quite yet. But I’m definitely getting there.

Matt Ballantine's thoughts about technology, marketing, management and other stuff…

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