Aberdeen has it right.

I want to firstly go back and review what Professor Langlois' said in his ESNIE slides. It is contained in the first slide and I would like to emphasis an important point of it. The quote is;

"He (the master gun maker) purchased material from the barrel makers, lock-makers, sight-stampers, trigger makers, ramrod forgers, gun furniture makers, and if he were engaged in the military branch from bayonet-forgers. All of these were independent manufacturers executing the orders of several master gun-makers. Once the parts had been purchased from the "material makers", as they were called, the next task was to hand them out to a long succession of "setters-up", each of whom performed a specific operation in connection with the assembly and finishing of the gun. To name only a few, there were those who prepared the front sight and lump end of the barrels; the jiggers, who attended to the breech end; the stocker's, who let in the barrel and lock and shaped the stock; the barrel strippers, who prepared the gun for rifling and proof; the hardeners, polishers, borers and riflers, engravers, browner's, and finally the lock-freer's, who adjusted the working parts." Slide no. 1

The individual is the key to the organization of the market. No companies, hierarchies, corporations or bureaucracies. Just individuals and markets. This is how I see the energy industry developing further in the future. More of a movement away from the silo'ed BP, Shell, and Exxon's to rely on the individual capabilities of the market. Certainly there will be BP, Shell and Exxon, however, their ownership and development of their reserve and land base will be their key concern, and how to employ the market towards their objectives will be how they achieve them. They key to their capability will of course be through their participation in the Joint Operating Committee of each property.

What we have here in the barrel maker example is a division of labor that is very fine. And this division of labor would provide the gun making industry with production volumes that would exceed the productive ability of the group of individuals acting independently. A further division of labor is how the oil and gas industry will increase its capability, throughput, and growth necessary for the commodity markets demands.

Reading now from the Economist about the state of affairs in British oil and gas, they note the following regarding the headquarters of Aberdeen.

"Yet even though oil and gas output is declining the local businesses that have sprung up to support it have bright prospects. The North Sea was one of the earliest offshore oil basins to be developed. Many of the technologies needed to produce oil from underwater wells - especially in the difficult, gale prone waters off the British coast - were developed in Scotland. Around 90% of oil industry workers are employed not by the big international companies such as BP or Total that operate the fields but by local businesses."

I want to state, what I see for this software development project is this software being built for the industry that includes Calgary, Houston and Aberdeen. These three centers will provide the European and North American industries with both the supply and demand for energy on a go forward basis. Houston has had a traditionally more global role in the energy business, but I am of the opinion that they have seen their people, assets and capabilities somewhat repatriated through the variety of nationalizations, in Venezuela and Russia, and China and the Arab countries adopting a more progressive attitude. An attitude that they will develop the capabilities to manage their industries for themselves. That American technology is better, but they choose to use their own resources for the long term.

Aberdeen is seen in this example as more capable, as the Economist article points out, in offshore operations, Canada in EOR, Heavy Oil and remote gas, and Houston filling in where its size and capabilities, particularly financially, are required. These three cities will operate in the Atlantic, Pacific, Gulf of Mexico, Mexico, Canada, the U.S. and the Arctic as their base. Versus Russia, China and the Arab countries will co-exist with little or no transfer of knowledge or capabilities between the two disparate groups, yet both will market their commodities to the highest bidders.

As the Economists article best reflects, Aberdeen may be the most able of the three to meet their needs through the "market" and less through the "firm". The latter two cities, Calgary and Houston, needing a more radical reconfiguration towards the market. Markets made up of individuals.

Technorati Tags: Genesys, Firm, Market, Langlois, Cluster, Capabilities, People

Enterprise Search and Security.

New Idea Engineering publish a monthly newsletter that discusses the difficult topic of enterprise search and security. They have recently published a series of articles under the heading "Enterprise Search: Mapping Security Requirements to Enterprise Search." The three articles are available here, here and here.

In terms of the technology used in this application, I have stated the architecture that will be used here. Two major additions being added to the Genesys architecture are;

• Use of the Google Search Appliance.
• Virtualization of a producers environment on the Grid.

These New Idea Engineering articles point out a number of very important issues that I will address when we are getting closer to the start of development.

Photo Courtesy of fox2mike
Technorati Tags: Development, Strategy, Software, Security, Search

A new addition for 2007.

During December of 2006 I added the books that I have found of interest and feel provide some value to the readers who may share my passion for this topic. Another area that I think I will add some value for the reader is a listing and my justification for readers to go out and secure documents that are published in a variety of journals.

There are three authors that provide the stimulation for many of the ideas here. They are Dr. Paul Romer at Stanford, Dr. Giovanni Dosi at the Sant'Anna School of Advanced Studies and Dr. Carlota Perez who is a guest researcher at Cambridge University. These three have formed a topic that is of much interest to me and I would like to point out the individual documents that are currently being research by myself.

In the past I would post many of their thoughts and ideas, however, I believe that to be a violation of their Copyright. I therefore will only point them out and suggest that many of the documents are hard to source and in most cases, require access to the major academic database services.

So for this first installment I want to highlight three documents that combine to form a series of discussions about the changes that are happening in the business and technical worlds. They reflect the changes will be some of the most radical that we have faced in many years and will be difficult for people and organizations to adapt. Much of the writing notes a transition to a different time where the fundamental basis of the economy has changed. We are in this period now and it seems timely to review these three documents.

1. Perez, Carlota (2004) Finance and Technical Change: A Long Term View (Provided here from her website.)
2. Romer, Paul (2007) Economic Growth (Provided here from the Concise Encyclopedia of Economics.
3. Perez, Carlota (2003) Rethinking Globalization After the Collapse of the Financial Bubble: An essay on the challenges of the Third Millennium (Provided here from her website.)

I hope that you enjoy them as much as I. As I begin to conduct more research, I trust there will be many more of these types of posts.

Technorati Tags: Research, Innovation, Cluster, Dosi

Metcalfe's declaration of the Massachusetts Enertech Cluster

Dr. Robert Metcalfe is a major force in the technology world. He is the inventor of Ethernet which is the basic underlying infrastructure of the Internet. Based on Ethernet, Metcalfe founded 3Com which was an integral part of the building of the Internet. A man of great ideas, and a man who has the ability to make those ideas operate in the real world.

Dr. Metcalfe has been affiliated with MIT through out the years, and works with Polaris Partnerships, a venture capital firm he owns, and has recently guest blogged on VCMike's Blog, a silicon valley early stage venture capitalist. Click on the title of this entry to review Metcalfe's ideas.

Metcalfe's ideas are that the greater Boston area holds 10 first class research universities and over 100 universities in total. This is the place that he proposes to house the "Massachusetts Enertech Cluster"(MEC). He proposes the MEC to be modeled on the Silicon Valley Cluster, the area of MEC's focus will be on innovation in oil and gas, and I can not agree with him more.

Metcalfe's interest from a venture capital perspective are listed in this blog entry and include: Ember, Scicortex, and Greenfuel.

"Ember is a networking company that delivers tiny radio semiconductors and protocol software. Ember’s aim is to network all the world’s embedded micro-controllers, of which, according to IDC (another Massachusetts company) there will be 10 billion new ones shipped next year. Ember’s go-to-market focus is home and building control. And what do you think the principal benefits of home and building control are? By wirelessly controlling lights, heating, ventilation, and air conditioning, many of Ember’s early customers are conserving energy. By wirelessly reading meters, many of Ember’s early customers better measure the energy they are saving"

"SiCortex is a computer systems company, so why is it an example of Massachusetts enertech? First, SiCortex has just launched open-source software Linux superclusters that improve by factors of 10 delivered computational performance per dollar, per foot, and, yes, per watt. Because they each consume two factors of 10 fewer watts than the PC microprocessors on our desks, SiCortex fits six 64-bit microprocessors on a chip and therefore 5,832 in a single cabinet, cooled by air, saving energy on running the computers and even more on cooling them. That’s enertech. And second, SiCortex is enertech because its superclusters are designed for high-performance computing applications, prominent among which are seismic data analysis for oil exploration, climate modeling, fluid dynamics, reactor simulations, quantum chromo dynamics — enertech. No wonder the lead in SiCortex’s recent $21M venture financing was Chevron."

"GreenFuel is now working with huge electric power plants in the Arizona desert to scale up its enertech. GreenFuel pipes CO2-laden flue gases through algae slurries circulating in solar bioreactors. GreenFuel algae use photosynthesis in enertech greenhouses to remove greenhouse gases (CO2 and NOx) from the flue gases before release into the atmosphere. And then, get this, the rapidly thickening algal slurry is harvested several times per day to produce lipids, starches, and proteins for extraction into substantial quantities of, respectively, biodiesel, ethanol, and feed. GreenFuel algae-solar bioreactors do require acreage, water, and electricity, but junk land, dirty water, and single-digit percentages of parasitic power. GreenFuel treats CO2 as a valuable plant food and, rather than try to sequester it expensively, GreenFuel recycles CO2, cleaning the atmosphere while producing cheap and clean energy"

Out of these I would particularly like to point out the business of Ember. Building the network for all the worlds embedded network microcontrollers. Metcalfe defines the market as being 10 billion devices that will be shipped in 2007. IPv6 will provide the unique addressing of each of these devices, wirelessly. This is exactly the reason why IPv6 and WiMax reside in my Technical Vision.

This is evidence to me we are entering a world where things are changing quickly. Companies that continue to hold on to old ways of business risk everything. Now is the time for change.

Technorati Tags: MEC, Innovation, Metcalfe, Change