A Community of Independent Service Providers.

With the preparation of this next years fiscal budget. I made the call to recruit 100 individuals to be involved in this first phase of development. These people will be involved in taking the Draft Specification and adding many of the necessary details for when the developers begin the job of the applications development. The deliverable will be the Preliminary Specification which will have rounded out many of the missing details in the Draft Specification and seek to provide creative solutions to the problems they discover.

Who are these people? They are the ones that are currently employed in the oil and gas industry, or have retired and have many years experience. They are the people that have worked for an oil and gas firm in all the different capacities and professions. Landman, accountants, geologists, engineers, field staff and many who were employed in the traditional energy service industry. People who understand and can articulate their point of view on the differences in using the JOC as the key organizational construct.

What exactly will they be doing. Building off the Draft Specification and taking it to the "Preliminary Specification" stage. This may include gathering the details of the various regulatory and compliance requirements of an application, working within the scope of the oil and gas marketplace as they define it. Adding their creative ideas of how an application should provide support to an oil and gas firm. I think it is only reasonable to establish a minimum scope of operations being North America and the maximum is any energy jurisdiction. The one advantage here is the Joint Operating Committee (JOC) is culturally systemic the world over.

These people will also be the critical first group that will join People, Ideas & Objects. What I expect is that they will be the first, or in on the ground floor of the opportunities that will develop for themselves and others. What I expect will happen is they will also be charged with developing the "Community of Independent Service Providers". Who will develop within their own businesses the service capabilities that will work with the software in the oil and gas firms. This first and foremost should be looked at as a business opportunity they can build in the new economy.

One hundred people sounds like a lot, and in many ways it is. However, they are all not going to be full-time. Recall as I have mentioned in the budget I expect this time to be invested by them in establishing their "Service Provider" operations. (In subsequent years work on the software will be fully compensated.) The broad diversity of the service offerings that have to be developed to augment the software is their domain of operation. By signing the license and registering with this community is how to get started. Recall all participants (users, developers, project managers and oil and gas investors) are entitled to leverage off this software applications intellectual property in their own service based offerings. The first 100 that participate in developing the Preliminary Specification will naturally have a significant head start in starting their service operations. People, Ideas & Objects provides the software and the developers, the Users provide the problems and our clients needs.

Where these people will be located is anywhere they are needed. Based on the scope that they decide they will be able to establish Service Providers in their region as they see fit. None of these licenses are exclusive, and therefore being first has substantial advantage. They are also the ones that will establish initial contact with the producers in preparing them to move to the system when it is operational. This marketing will be done jointly by People, Ideas & Objects and the Service Provider. We will be using some form of Salesforce.com applications to ensure that the oil and gas firms are managed by one Service Provider who will sub-contract the work for that oil and gas firm. I will reiterate, being first has substantial advantages.

When should they sign up? What's wrong with now? Follow the process as described here, please note that we need senior oil and gas individuals, this is not something I don't think anyone should attempt that does not have 10 years of oil and gas experience. Not to discourage anyone, but the detail in the Preliminary Specification will be somewhat high level but detailed, if that makes any sense. So please follow the process and sign up as soon as you can. In a lot of ways I think this opportunity fits the somewhat tech savvy early or soon to be retiree of the industry.

If I have not mentioned this next item on the blog before I would not be surprised. It is in the private wiki as one of the project policies. Users, Developers, Project Managers are compensated for their time, however, People, Ideas & Objects will only contract for 110 days out of each calendar year. The reason for this is to increase our scope of understanding of the industry by essentially doubling the number of people in the project. And ensuring that the individual is also actively engaged with the oil and gas firms through their Independent Service Offerings. Learning, anticipating their needs and guiding the developers in the development of the solution to those needs.

I have talked about the response that I have received from the oil and gas companies. I would certainly not wish this treatment on anyone else. Therefore I should state that all of the operations in the wiki and this work of the first 100 will be in complete confidence. Access to the wiki is through the People, Ideas & Objects account that will be provided. The communications are all encrypted in https. Therefore if you were to be using the wiki in your office your boss would never know. (Not that I would encourage that, but I would certainly endorse it.) The only way that your "boss" may find you are involved in this project is if s/he is a participant in this project. There is no need for anyone to be associated with this project and as such be affected by the companies apparent insistence that it not be built.

If you know of an investor in oil and gas that this project may appeal to. Please forward the URL to their attention and encourage them to commence the financial support of this project. And please, join me here.

Technorati Tags: People's User Proposal Call-to-Action

A new revenue stream.

In the back of my mind I have frequently thought there was a role in this software development project for governments. I have now determined that the reasoning for them to support this project is at least as strong as the argument I have made for the disgruntled oil and gas shareholder.

What's going to happen to the capital intensive oil and gas industry as a result of this credit crisis. Need I say more. It should be anticipated that many projects will be canceled as a result. Maybe even some voluntarily. I think in the first year or so the commodity prices will decline, not substantially from here, but remain depressed as a result of demand destruction. We know this does nothing to the reserve life index other then watch it decline further and further. Therefore I think by 2013 we may see the majority of the capital that was injected in the industry from credit and investors being replaced by the higher commodity prices that provide a reallocation of the financial resources for innovation.

To describe the routine that we will be going through in the next five years is not something that is positive. I hope that everyone can hang on to what they have, but these will be as difficult times, and may be much worse then the great depression. There is a purpose and reason for this pain, and it is so that we are motivated to move to a more efficient future. The quicker we get over the pain the better off we will be.

Why would this downturn be worse? Firstly it's more global then local. The Americans are showing the way, not because they are the worst off, but because they are always the first to see a problem and deal with it. Other countries in Europe, mostly, are in much worse shape then the States and yet, do not have the resilient character to pick themselves up as quickly. Those that profess the doom of the U.S. will be sadly mistaken by the events of the next five years. And how the events that come along will seem to favor the Americans, in which they will dominate the world marketplace for decades to come.

This is a failure of everyone and no one. The economic system that we depend upon is no longer efficient enough to feed and provide for the population. The basis of organizations, the hierarchy is unable to meet the demands of it. This is primarily as a result of its inability to change and innovate, and is a form of organization that is static. The auto industry can't change the cars they provide. The solution in the future will not involve a car. The energy industry can't meet demand for energy and the companies continue to see large declines in their reserves and production. These are the problems that are being represented in the credit crisis. Its an unsustainable way of life based on the way in which business operates. This is to a large extent the failure of bureaucracy, just as central planning was in the former Soviet Union.

In the 1700's Britain's population was around 6 million people. Life was terrible with mass hunger and overpopulation being the critical issues of the day. Professor Ludwig von Mises said the industrial revolution was the solution to world hunger and over population. Mechanical leverage from the industrial revolution provided Britain with the ability to grow to 24 million people and be very prosperous in the 1800's. It is this exact same situation we find ourselves in today. We have to re-organize and become far more efficient to feed and provide for the 6.7 billion of us. This will be done by the Information and Communication Technologies (ICT) revolution.

Non the less, identifying this second stream of revenue may provide a large percentage of the capital necessary to meet our needs. In the Preliminary Research Report it was determined based on the Theory of Structuration of Anthony Giddens and Model of Structuration by Professor Wanda Orlikowski that software defines and supports the organization. The bureaucracies have, or will very soon, lose the ability to organize themselves and function. This is why we need to build this software and why the governments will need to financially support this project. 

After the collapse, if we are to attempt to resurrect the way that things have operated in the past. Then we will be unable to deal with our current difficulties and adjust. This adjustment will be fundamentally different then the previous five economic meltdowns. The last being the great depression. Today we are able to use the technologies to redefine the new organizations and ways that we are going to work. This isn't technology being implemented for technologies sake. This is now a necessity. We can regress completely to manual systems and live like barbarians, or build the systems that will define and support the organizations of our future. A simple choice.

This is where the second form of revenue is established in this software development project. Governments have a vested interest in ensuring their people are not harmed by this credit crisis. It is they who should act in concert with the previously identified disgruntled oil and gas investor. Both of whom are the direct beneficiaries of this application being built, and I am suggesting therefore they are two groups that share the responsibility of making this project real for oil and gas.

Now the government is certainly not only interested in the oil and gas industry. This principle will apply to all industries and in all walks of life. And that broader role is something that these governments should see quickly in terms of reducing the pain of the credit crisis.

So I am calling on the governments to work with the People in this project and provide some of the funding. This is the governments that have centers in their economy that are dependent on oil and gas, such as Alberta, and those that are part of a larger government, the Canadian, U.S. and other jurisdictions. The point I am trying to make is that some governments have a direct interest and some have an indirect interest in making this software available in the marketplace as soon as possible.

Ideally I would like to see the governments contribute the financial resources necessary to cover off the regulatory and royalty requirements of each jurisdiction represented in the application. I would also expect that the governments would provide an element of dollars that are necessary for the overall application.

Can everyone see how the hierarchy and its legacy continue for the next century? This is a time of renewal not of resurrecting dinosaurs. Getting in the car in the morning to drive to work is so unnecessary in the future. Does anyone expect these actions that are defined by using the bureaucracy should remain? I have provided a sound and workable vision of how the energy industry could function in the future. This is represented in the Draft Specification and consists of the eleven modules. Professor Carlota Perez states that the People need to know that the old ways can no longer sustain them before they will move to the new vision. That time is today, September 30, 2008 and this credit crisis will affect us for the next five years. We should move now.

If you know of someone that falls into either of our two primary revenue streams. Please send them the URL to this blog and the URL to this specific page and ask them to consider the role that software can take in making the "pain" that we will suffer less. And join me here.

Technorati Tags: People's Perez Change Software Trends

It's not enough.

The bailout package being discussed in the U.S. is not enough to fix the system. Keep the $700 billion and use it to help build the "new" systems after the failures are purged from the landscape.

Attempting to refill the toilet bowl as it's flushed is, and always will be, futile. The systems supporting our economy are no longer adequate to meet the needs of our economies. The way they are structured is based on many of the principles established in the 1930's depression era. Have we learned anything about economics since then? Has Information & Communication Technologies developed since then? Let the failure occur.

If we read Professor Carlota Perez, who's analysis has shown this is a systemic economic event. That has happened consistently over the past 300 years. We should welcome this decline for the opportunities that it provides. This turning is as violent and disruptive for a reason. Organizations don't change from the old technologies that brought the economies along. They have to collapse in order for the new players and organizations to rise from the ashes.

The entire world economy will be going through the same problems. Europe is stuck in an economy that is static since Margaret Thatcher, and she was only able to bring Britain into the 20th century. With everyone falling, the economic leaders will remain the economic leaders in the next era.

The energy industry is not immune to these events. We have seen some high profile oil-sands projects canceled for one reason or another. I suggest financing is not available. And as I have suggested CNRL's Horizon project will be one of those eyesores that quietly rusts in the middle of nowhere. When credit systems fail, capital intensive industries such as oil and gas will feel it. What should someone who has worked in oil and gas do after they have been laid off from the oil and gas companies? They should join me here in making this software that will define how the new oil and gas industry is rebuilt. Unfortunately this is the only way that business can make the fundamental changes from era to era.

One thing that is systemic in all of Professor Perez writings is the scope and speed of the new environment that we are moving towards. Very quickly we will see the focus of people move away from the housing and consumer focus that brought the system down. They will now understand and appreciate that the greatest miss-allocation of capital (the past ten years) is over and they can begin building a new and more prosperous life from the ashes. It's time to invest in those businesses that will lead the world out of the old economy.

I noted earlier that the Financial Marketplace may have seemed a bit of a stretch in terms of the changes that were proposed in the Draft Specification. With the events of the last couple of months we see that the banking system is inadequate for our future needs. New regulations and technologies will be introduced into the system that will mirror the changes I have proposed in the Financial Marketplace module. Professor Milton Friedman has this to say about the "crisis" we find ourselves at the beginning of;

Only a crisis-actual or perceived-produces real change. When that crisis occurs, the actions that are taken depend on the ideas that are lying around. That, I believe, is our basic function: to develop alternatives to existing policies, to keep them alive and available until the politically impossible becomes politically inevitable. Friedman 2002, Capital and Freedom.

This projects pace has slowed to a crawl. I am unable to move the project any further without the financial resources necessary to make this real. If there is any doubt in your mind as to the need for such a "radical" change, it should be put to rest by these recent events, and those that will be coming. If you know of someone in our revenue profile, an oil and gas investor disgruntled by the bureaucracy, send them the URL to this web log and encourage them to keep this project moving forward. And, join me here.

Technorati Tags: People's Change Specification Trends Perez Friedman

Now that Russia has cut itself off from the rest of the world.

Click on the title of this entry to be taken to Bloomberg to view a series of guests discussing the Russian economy.

What happens to their oil and gas production? And more importantly for us, how will that production be replaced. With the lack of capital and a surplus of Kalashnikov's in Russia, I fully expect the Russian people's motivation is the most damaged from the KGB Leader, Vladimir Putin. Therefore it is reasonable to assume, that with no BP or Shell to pick up the slack, that Russian oil and gas production will enter an accelerated steep and possibly never ending decline.

Did Putin believe that the decline of the USSR was a mistake? Does he believe being the sole power of a small inconsequential country is better? Flying planes into Venezuela to be at the command of the little idiot Chavez only shows that Russia may be set for bigger surprises from Putin. These types of activities put Putin in the mad man category.

Russia being the largest energy producer, and its inevitable decline is our (the Wests) problem. This production needs to be replaced and we don't have a lot of time. Maybe we can approach the scale of this problem by using the old bureaucratic standby, but I think the clock is now ticking much faster. If we are going to approach this energy supply problem with the same old organizations throwing more money at it, count me out. I think we need to re-organize and approach the industry from the perspective that the Draft Specification provides.

From now on the problem with energy is that nothing gets better. The problem only grows in size as events take over the pricing of the commodity. The $50 slide in the price gave the consumer the "all clear" and I am certain they'll be back to consuming just as much as they did before. We need to act and the first act in this long and difficult road is to organize the people in ways that can maximize the production and minimize the consumption. These two objectives were forefront in my mind when I was writing the Draft Specification. It is not enough to increase the performance of the industry by 10 or 20 %. We need exponential increases in the performance of the industry. This can only happen by starting from a clean slate.

People, Ideas & Objects needs money. I am frustrated by the fact that I cannot move this project any further by myself. If you know of someone that fits our revenue profile, a disenchanted oil and gas investor who has had enough of the bureaucracy. If so, please pass the URL of this web log over to them and encourage them to commence the process of establishing our much needed revenue.

In systems development you can pick any two criteria out of three possibilities. The choices are cost, time and accuracy of the systems. I have selected time and accuracy as the two most important priorities for this application. The costs are going to be much higher then any of us would like, making my job particularly difficult. Please join me here.

Technorati Tags: People's Failure Sponsors

Offshore drilling ban, banned!

If the political climate remains constant in the states, we can assume offshore drilling to survive the next administration. The American people want offshore drilling for oil and gas to fuel their economy. Add the necessary technical leap that is required to fully exploit the resource potential of the Pacific and Atlantic offshore. On top of the operating environment of the Gulf of Mexico, the Arctic, heavy oil, unconventional gas. Makes North America the most demanding operating environment. Add to it the retirement of the brain trust of the industry, politics and environmental concerns and you have a sizable task ahead.

One of the key developments in the Preliminary Research Report was that systems define and support the organization. What's SAP's plan for the oil and gas industry? Whats their approach for the high energy cost era? Or do they see the industry as unchanged from the $25 / barrel era?

Its at this point where the first reaction will be to spend more money. I think that will be a mistake. Its a systems first world we live in. If we approach this opportunity with the same old bureaucracies, we're not going to get there. (Increased production volumes). Offshore drilling is expensive and I don't expect any increase in drilling for a number of years. The time lines for new offshore production is long, and we have the opportunity to build the systems that will enable a more innovative, science and engineering focused producer. An appropriate competitive advantage for a producer in this new era of oil and gas.

I propose we build this system to ensure the innovation that is possible gets implemented into the industry. As I have stated here before I believe this system could attain an exponential increase in the performance of the producer. Innovation and performance increases are what have been solved through this five year research project. Now its time to build. Please, join me here.

Technorati Tags: People's Energy Funding Offshore Science

Professor Clayton Christensen on MIT video

To be honest I am not a fan of Clayton Christensen's. I find he is standing on the shoulders of giants and not adding much more then a clear message. Lets call him the Oprah Winfrey of innovation. Nonetheless, this video provides some very interesting insights in the topic of innovation and where we find ourselves in the oil and gas industry at this time.

Professor Christensen has written many books all evolving around the theme of disruptive innovation. He sites three ingredients that are needed to develop a disruptive innovation.

Technological Enabler

As I mentioned here a while ago, the real innovation of this software development project is the virtualization of each and every worker in the oil and gas industry. It is impractical and inefficient for individuals who may work for a variety of JOC's and the companies that are represented there, to move from job to job during their day. Although most of the head office staff only have to go a block or two, people in the field would have farther to travel. Impractical by any measure. In order for people to physical meet and discuss the business of the JOC, the industry would be reduced to a standstill while people reconciled their calendars. The virtualization of the working environment and the introduction of Asynchronous Process Management (APM) (a cornerstone of the People, Ideas & Objects technical vision) deals with these two problems.

Business Model

It's not known if Christensen is talking about the People, Ideas & Objects business model or one of the companies in the oil and gas industry today. In terms of this projects business model, in comparison to the big SAP and Oracle applications, we provide a comprehensive vision of how we see the oil and gas industry operating. The Draft Specification captures this vision and provides an understanding of how an oil and gas producers business could operate. Oracle and SAP have made the sales to the oil and gas business, therefore they doubt anyone else would buy it, and that, other then they are not welcomed by the producers, is why they don't show up on the radar screen.

People, Ideas & Objects are making this application on a development cost plus basis. This application is not sold as an application but as a service. The costs of which are allocated throughout the global oil and gas industry. What was a major cost and effort to host and install Oracle or SAP are tasks borne of the bygone (bureaucratic) era. In addition to the software as a service, the community that is involved in building the software application provide the services to the industry in running and managing the oil and gas producers enterprises, or should I say JOC's.

The costs associated with these activities will be billed by the community members service based organization, and an assessment of a fee for the use of the software. The software will be billed on an assessment basis of x dollars per barrel of oil equivalent per year. At $10 / boe / day a firm with 200,000 boe / day would therefore pay $2 million for their use of this system. This is based on the development requirements as determined by the community.

The oil and gas industries growth strategy and / or business model for the past 30 years has been to muddle along. Great when the oil and gas was easy to find and produce. Muddling along doesn't provide a business model that can compete when the sciences and engineering are the key differentiating competitive advantages. The focus needs to be on the science in order to achieve profitable operations. Science and an ERP application like People, Ideas & Objects.

Someone tell me how a generation of oil and gas companies, reared on muddling along, are going to change their strategy to one based on the sciences in the time that the market needs more oil and gas? They haven't in five years that I have been trying, and Ill bet the ever decreasing size of the producers production will eventually trigger their own Wall Street type of collapse. As Nelson and Winter noted recently, industries evolve, companies come and go.

Commercial System

See Business Model discussion about how this community works.

Christensen goes on to note companies will either reject or co-opt a new technology. I can assure you the oil and gas industry has rejected this technology. I think I have also provided a strong case as to why their demise should be accelerated. This is the task I am calling for the shareholders of oil and gas companies, to withdraw their support of the bureaucracy and fund these software developments to ensure their best interests are managed properly. Otherwise face an uncertain future that may be as tumultuous as what Wall Street is feeling.

"Facilitated User Networks" is the third type of disruptive business model that Christensen notes. Stating they are lower in costs and more effective in terms of performance. I think this software development project meets that definition and criteria, and the oil and gas industry sure needs lower costs and higher performance. Design of the Draft Specification is clear, clean, crisp and concise. Anyone with 5 - 10 years of oil and gas experience can see the way in which the industry will operate and how their role fits within this community and the larger oil and gas environment.

The investors that have traditionally invested in oil and gas are of course the people who know and understand the business. There are others who have attained larger holdings and may have had some influence on the management in the past. These are the shareholders and investors that I think would have an interest in funding this project. If you know of any, and can send them the URL to this weblog, it would be appreciated. This project is now at a stand still until such time as funding is provided. I have established a modest budget to keep the "doors open" but up to this point I have received no indications of any funding. Please join me here.

Technorati Tags: People's Innovation Failure Organization Video

Where we're at in 624 words.

The following is a summary of where all the time went. September 2003 - May 2004. The beginnings of the People, Ideas & Objects software development project were based on my Master's Thesis. My hypothesis asked if the oil and gas bureaucracy had become redundant and if so; would the Joint Operating Committee, augmented with today's Information Technologies, provide for a more innovative footing of the oil and gas industry?

The findings of this research confirmed the hypothesis. If a producer was to move the compliance and governance of the bureaucracy to the legal, financial, cultural and operational decision making frameworks of the JOC, a greater alignment of these frameworks would provide for far greater levels of innovation. Additionally it was determined that systems define the organization. In today's business, any change in the organization must firstly be planned and software systems developed to identify and support the organization. Otherwise the organization will be relegated to manual systems.

May 2004 - December 2007 Comprehensive research was undertaken to determine; if the JOC was adopted as the key organizational construct of the oil and gas producer, what would an ERP styled system look like.

January 2008 to July 2008 a "Draft Specification" was published providing an overall vision of the systems modules. The system currently has eleven modules defined in the "Draft Specification" as follows:

• Security & Access Control
• Petroleum Lease Marketplace
• Resource Marketplace
• Financial Marketplace
• Partnership Accounting
• Accounting Voucher
• Compliance & Governance
• Analytics & Statistics
• Knowledge & Learning
• Research & Capabilities
• Performance Evaluation

One of the main reasons the People, Ideas & Objects software application can work is that when embedded in a transaction based collaborative environment, there is no need for the people to physically move from JOC to JOC. Bridging the physical distance between the participants in the JOC is enabled in the virtual transaction based environment of the application, which in turn enables the re-organization.

Since July 2008 I have attempted to make the case that the current bureaucracies are indeed failing and are only operating in managements own best interests to better themselves. Showing that declining reserves and production are leading to lower profits and even losses. Costs are escalating incrementally as project targets slip. Systemically using derivatives on the commodities they produce to prove they have no idea or understanding of what business they are in. During all this time, management have been rewarding themselves for this performance with multi-billion dollar stock option compensation.

August 2008 saw the commencement of the discovery process on how the funding of this project can proceed. Sourcing revenue for this project from the disenchanted oil and gas investor is the most likely candidate for starting the revenue. Unlike management's fleecing of Bear Stearn, Fannie, Freddie and Lehman shareholders, the People, Ideas & Objects software development project provides the oil and gas shareholder with options.

The purpose of this project is to build an environment where the oil and gas investor can produce their oil and gas in the most profitable manner. This is about enabling the industry to evolve at the speed of the underlying sciences. Based on this body of intellectual property, where the software is hosted in the "cloud," and the community of users provide the services to the producers in their own service based offerings.

This software development project needs Users (Oil and Gas workers of all professions), Developers, Project Managers and Oil and Gas Investors. The oil and gas investor has a vested interest in sponsoring this project and providing the funds necessary to build the system. This system provides the investor with an alternative organizational structure to have their oil and gas assets managed by this community. Managed in the most profitable manner where they are able to effectively control their assets in their best interest.

Technorati Tags: People's Summary Sponsors Value-Proposition

Shareholder beware.

This current financial meltdown is not an under regulation problem, but an over regulation problem. Although I have issue with the expectation that markets will fix everything, and this may be a symptom of that expectation, the real culprit is the separation of ownership and control within a business environment.

I pulled this reference from the www.adamsmith.org website.

...negligence and profusion resulting from
the separation of ownership and control in a business enterprise.

The author of the article that made that quote brings up an interesting point in the subsequent debate. And that is, the reference to the separation of ownership and control being the Federal Reserve and Treasury Departments recent actions to companies on Wall Street. The Fed and Treasury are certainly not accountable to the shareholders. He makes the following point as well.

There’s a pattern here. The biggest shocks to the financial system have all come from stock market companies. By contrast, hedge funds, which many expected to cause trouble, have been innocent bystanders. These are, generally, owned as private partnerships. So one form of ownership has caused a crisis, and another hasn’t.

To add insult to injury, the Fed and Treasury are trying to stop this immovable, and natural force. This is a Republican administration that is based in the Reagan doctrine. Recall that he stated the nine scariest words in the English language are;

We are from the government, we're here to help.

In Saturday's Wall Street Journal, Amity Shlaes says we are following the same failed steps that were taken in the lead up to the great depression. Her article matches the players and their roles between 1929 and today with frightening similarities. Do we really believe that the government is going to be able to solve these business problems?

Within the oil and gas industry we have a different type of problem. The shareholders are being fleeced by the management. Why, because the rules and regulations that are designed to protect the shareholders limit their actions to a few minutes each year. That also assumes that the investor can rally the other shareholders to fight the management. A proxy scenario that is played out in only the most extreme cases.

I have written many times about Professor Carlota Perez. Her analysis shows the results of seven severe global changes in economics. These have occurred over the past three hundred years with the last one being 1929's. She has identified the many stages that an economy progresses, and describes in historical detail the scope and scale of the changes. In a nutshell she has detailed the process of how the old industries die off and the new industries take over as the key in the economy. Her prescription is very accurately being played out on the today's newspaper headlines .

In each case Professor Perez details the important role that financial capital fills in these transitions. Overbuilding of the infrastructure of the next great surge is something that has systemically happened. Whether it was roads, canals, shipping or in today's instance the Information and Communication Technologies. (ICT)

This is a healthy period and one that should be embraced. What the old economy will be doing is falling flat on its face. The scope of the failure according to Perez has to be significant enough "that people know the old ways no longer work". That is the only motivation that people will have to move to the new economy. Financial capital then assumes a much less significant role in the economy. This eventually leads to the crashes and other "meltdowns" that are also systemic with her data and analysis. Product capital, something that barely exists in my opinion, rises from the ashes of the financial capital.

It is my opinion that we have another problem on top of the ones that are being discussed here. That is the management of organizations, companies and governments are invincible. That is to mean they are employed in the act of solving problems for the most part. Lets call this the new oxymoron, the art of management. It may be up to half the people in the U.S. economy are employed in a role of overseer. They can't help themselves but to manage their way out of a crisis. I don't think this was necessarily the case in 1929 and prior economic collapses. At some point, however, they will realize the fact that no one can stop these forces and they are not necessarily bad, and get on with the prosperous future that is in front of the us. Schumpeter calls it creative destruction for a reason. 

Charlie Rose hosted an interview with AIG's former head Hank Greenberg. As a significant shareholder in AIG he feels he should have a seat at the table when discussing any future firm plans. In the video, Greenberg is completely in the dark in terms of how the company is going to be affected, and no one has returned his calls. Amazing. This is not capitalism. The problem here is that we are talking about Hank Greenberg. If he can't get anyone to call him, why would any one call the smaller investors?

The attitude of the Fed and Treasury may have assumed that the time for Hank Greenberg to act was long ago. That he didn't act in a timely manner was his problem, and he should bear the consequences of his inaction. I think that the love affair that Hank had with Elliott Spitzer was probably what distracted him from fulfilling his rightful duties. Imagine that an individual run out of their business for innuendo and rumors from a dirty government official.

Lets be honest here, western society has believed the shareholder was passive. That management were best able to manage the company. These statements, from both perspectives, are now seen as folly. The investor can not sit idly by uninvolved. We all know it doesn't work that way. And more regulations on the management only entrench their useless activities deeper within their untouchable domain. Has anyone heard a single complaint about Sarbane's Oxley lately?

To my point in this web log. The oil and gas investor can see clearly how they are being treated, and their prospects of future treatment in this environment. They are also the leaders in this capital intensive industry. The money has to go first to make things happen.

Here is what I recommend for the oil and gas investor to do in the next five years.

• Start funding this project.

Our budget for this year is only $180,000 and that can be shared amongst many investors.

• Get out of the oil and gas companies that you own now.

Oil and gas has to transition from the old era to this new era. Picking the winners and losers is impossible. People, Ideas & Objects is the new era of how an investor can manage their investments. Actively, much like a hedge fund that was discussed earlier.

• Start picking off some of the properties in oil and gas that will be offered for sale.

The investors lack of investment in these oil and gas firms will cause the financial's to deteriorate. Particularly with the credit tightening that is now ongoing. The energy companies are going to have shortages of cash and the properties will need to be sold to maintain operations.

• Get involved in actively managing these assets by getting involved in the People, Ideas & Objects ERP system and community.
  

Don't let what is happening to Hank Greenberg happen to you. At the very least you should hedge your bets, join me here.

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Google Search Appliance

Google recently did a presentation about their current version of the Google Search Appliance. As with my recent post of how documents work in Google Docs and how I see similar behavior in the proposed People, Ideas & Objects Draft Specification. I will be adding the key points of Google Search Appliance into the Draft Specification.

Some of the key technologies in Google Search Appliance put it in the must have category of any firm. For this project that would include project managers, users, developers, producers and Joint Operating Committees (JOC's). It solves the key concern that I have about enterprise search, that being the right access to the right data.

I recommend that all readers view the entire presentation. It highlights far too many things that are of significant value to this software development project. A few of those highlights are listed here;

• Kerboras based User queries - makes queries recognize the scope of the users authority.
• Single Sign On (SSO) - enables the user to maintain high level security without having to constantly log in.
• Customized authority and authentication - able to build off the Security & Access control module of the People, Ideas & Objects application.
  
• Domain Specific Queries - enables the user to request data from People, Ideas & Objects and only the information within their domain will show in the search results.
• Document level security.
• Key match search provides authority attributes.
  
• Databases (MySQL) - can include data elements from the database as well.
• Related Web Search - search results can include web based results.
• Collections are indexes from Google and are unlimited technically, but overuse has a performance hit. Provides the ability to focus search in specific areas of interest.
• Customizable "front-end" or search page.

With this search capability users will be able to access their data from anywhere and at anytime. Yet provide the JOC and producer companies the user works for with a trusted source of search technologies.

Keeping on the topic of Google and their technologies. The addition of multiple languages to this application presents a very difficult technological issue. I have set up two projects in the private wiki; the first project will address the scope of the language related technical issue. The other project is to determine if Google's Language API can provide the translation from English to the other languages that may be used by users in the People, Ideas & Objects application.

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How will Oracle and SAP approach the oil and gas market.

Oracle and SAP have their systems installed in many of the top oil and gas producers. Encana for example uses a variety of Oracle products, which I believe include J.D. Edwards and PeopleSoft. Makes you wonder why are they're hiring developers to build their OilCo and GasCo consolidation software?

One of the critical competitive advantages that we currently have in People, Ideas & Objects is that we are not constrained by the existence of operational software code, and customers operating from that code base. Moving in the direction that the users want and need have no consequences in terms of time, money or effort. Change is dynamic at the beginning of the project and therefore, it is important to consider as much as possible for inclusion into the preliminary through to final specifications.

SAP and Oracle have to look at the oil and gas marketplace with the idea that they have successfully sold the application in the marketplace. What is their upside in terms of new revenue sources? What type of application can be sold into the market, and specifically how would it compete with this People, Ideas & Objects user driven initiative? What mode of organizational structure would be used to model the innovative oil and gas producer? I can only think of the bureaucracy and the Joint Operating Committee. Since this project holds the intellectual property of using the JOC, they are precluded from competing on that basis. SAP as I have said many times before, is the bureaucracy. And therefore any justification to replace Oracle or SAP's current software applications would need to address how it's not a waste of time, money and effort.

Please note this decision to replace the application is at the discretion of the users of this project. If they decide tomorrow to scrap the project and start anew that is fine with People, Ideas & Objects. We are not selling a software application over and over again. Our revenue is based on our Intellectual Property, the cost of developing the application and a percentage for maintaining and profiting from our development capabilities. The costs of this development is therefor substantially lower then the aggregate revenue streams of our competition. 

Which I guess that leaves two options for a producer that wants to shed their bureaucratic ways. Either pool the industries financial resources in the People, Ideas & Objects application, or hire a few hundred developers each to do some custom in-house work. The latter probably makes the least sense when we consider the current bureaucracies are faced with declining reserves and production, increasing debt loads, quarterly losses and retirements of the brain-trust. But then I am rather biased about that.

This project has to find new sources of money and leadership to fill-in the many voids of the overall vision. If you know of someone who could help to financially support this project please do what you can to bring their attention to this. Ninety-five percent of the ownership of the oil and gas industry is held by individuals. Individuals who are the investors, users and developers of the People, Ideas & Object application. Join me here and lets build this software.

The PayPal button on this website will gladly take donations that can further us along in the road we are headed. Even if you can only contribute $10.00 we will be that much further ahead. Join me here.

Technorati Tags: People's Ideas IP Development