McKinsey on Market Rebels.

I have to say that I like this article, its writer, and the video that is included. (Click on the title of this entry) It has particular value to this community as we begin the process of recruiting members. To start off the opening paragraph states:

Activists who challenge the status quo play a critical but often overlooked role in both promoting and impeding radical business innovation. Their importance stems from the very nature of innovation, which frequently challenges existing interests, norms, values, social practices, and relationships. As a result, the joined hands of market rebels—activists and their recruits—have with surprising frequency exerted significant influence on market acceptance of breakthrough products and services.

This is more support for the changes prescribed by this community. I would suggest that the size of this community is very large for the type of change that is being prescribed. It is this community that is aware of the problems in oil and gas, aware of the details contained within the Draft Specification, and beginning to be aware of a possible role for themselves within these software developments. It truly is a community of rebels who are well positioned to move to accelerate the needed changes in oil and gas.

With lay-offs beginning in the industry, the demand for this community will begin to accelerate. Our appeal to the oil and gas investor and the government groups, with oil and gas royalties, are beginning. These two identified sources of revenues will soon begin to support the needs of the community and begin to offer an alternative means of employment and operating in the oil and gas industry. Both the software and the associated services of this community will better manage the oil and gas resources compared to the bureaucracy. This article shows that there are difficult roads ahead.

These examples and many others hold valuable lessons for executives pursuing innovation. The costs to consumers of adopting such innovations are high because adopters have to topple existing conventions. Stimulating collective endeavors that initiate social change can be a critical part of reshaping markets.

It has to be asked. Can the oil and gas industry as it exists today change to what is necessary for tomorrow? Will the bureaucracy still be in power in 10 years? These two questions show the future is not going to be met by our current organizations. As we roll into the 2008 annual earnings season. We will find that these companeis have ceased to find new oil and gas reserves and production to meet even last years performance. In some cases, such as Exxon Mobil's in 2007, they lost 10% of their production. Expect to see an acceleration of the production declines during 2008, and even an accelerated further decline in their projections. This communities job is not a luxury or a nice to have, it is a necessary action to ensure that society and people are provided with reasonable volumes of energy for years to come. These firms are failing and will not be around in ten years time based on today's performance.

To do so, companies must understand how market rebels forge a collective identity and mobilize support. Crucial for many activists is articulating a “hot cause,” which arouses emotion and creates a community of members, and relying on “cool mobilization,” which signals the identity of community members while sustaining their commitment. Companies also can boost their odds of harnessing the power of collective action by employing the right tactics, such as emphasizing two-way communication with consumers. Above all, a mind-set shift is needed: managers hoping to foster and encourage the diffusion of radical innovation need to start thinking like insurgents. Those who do so are likely to become more effective at influencing their own organizations too.

One of the objectives I had set out for this year was the recruiting of 100 individuals to take the Draft Specification and develop the Preliminary Specification of the People, Ideas & Objects software application. These "rebels" will be investing their time and capabilities in establishing their own Community of Independent Service Providers to support their use of this software in the producer firms they will represent. These people will be best able to take the ideas in the Draft Specification and determine what is required in terms of the application and the services that need to support it. These people will be defining the oil and gas industry and how it will operate in the future, and how their service based offerings are designed to keep the industry innovative.

Market rebels aren’t Molotov cocktail–throwing World Trade Organization (WTO) opponents. They are groups of individuals who together shape markets through hot causes, which arouse emotions, and through cool mobilization, which allows participants to realize collective identities. Executives that understand the roles and practices of market rebels are more likely to be successful innovation leaders.

Please join me here.

Technorati Tags: People's McKinsey Community Change Failure

The top 25 posts of 2008.

Much like other blogs I wanted to publish a "best of" list of the favorite content. I have been using Google's Feedburner service for many years and have watched this community grow. Google's acquisition of Feedburner was completed this past summer and as a result the domain changed and we have lost the cumulative "best of" or most popular data. However we still have the data from July 22, to December 31, 2008 as listed below.

Unfortunately, their is no information on the popularity of the Draft Specification which was published between December 2007 and August 2008. Google has made many positive changes to Feedburner and are still working very hard on improving the service. Here are the 25 most popular items on innovation in oil and gas. 

McKinsey, The Next Step in Innovation 

IBM CEO Sam Palmisano 

The State of the Energy Industry 

Carl Icahn's United Shareholders 

Recommitting to Sun Microsystems 

The Secret of Successful Strategy Execution 

Paris Hilton on Tuesday, Brittany on... 

Google Health, and its user interface 

Canadian Natural Resources Questionable Accounting 

Miss-allocated capital 

Times like these call for... 

The Economist on Cloud Computing 

The U.S. Election 

For the next 20 years. 

News Alert: Pigs can fly 

Encana, The software company 

Project Charter - Preliminary Specification 

Professor Peter Klein on Entrepreneurship 

What would an Anthropologist do 

International Energy Agency 2008 Report 

This little piggy built a house of straw. 

Beyond the Red Horizon 

British PM Gordon Brown, gets it. 

A Community of Independent Service Providers.

Why would accounting firms survive? 

Thanks for reading, and please join me here.

Technorati Tags: People's Summary

Just because they say yes...

... doesn't mean its ok. I thought we would have learned that lesson from the mortgage fiasco we are now experiencing. Just because a banker says you can have that new house does not mean that it's a wise decision. This logic is something that people should have thought about when it was happening, not when it's too late. 

Just as the mortgage broker, President Barack Obama and the Democratic Congress should heed the call to think twice about "stimulating the economy". We proved that Keynsianism was a flawed economic policy in the 1980's. Why is it now assumed that the problems brought about by easy money is going to be fixed by even easier money. Failure is a necessary element of economic change, and failure has to occur to make way for the new success. There is no way to avoid it. By delaying the organizational failures only makes it more costly in terms of higher unnecessary debt, and longer time frames.

We see here in an article from the New York Times  that the Chinese may be at the end of their unlimited financing of American consumption. What happens, President Barack "I'm in over my head" Obama, when the world says "no I'm not investing in that"; and the Obama budget meets the immovable mountain of the Chinese propensity to finance the American taste for debt . 

Moral hazard is here, no consequence from the government actions are considered. It's all just a matter of waving a magic Obama wand and all will be well. Or alternatively, we just dig ourselves into a much bigger hole to dig out of in the not so near future. 

Technorati Tags: People's Government Economics Failure

Apple's App Store and others.

What this post is about is the type of environment or community I see People, Ideas & Objects becoming. There are many types of communities that exist today that I can point to, and detail the attributes that appeal to me, and what I think should be emulated in "our" application modules. (Click on the title of this entry to be taken to a New York Times article on Apple's App Store.)

Google 

I am a prolific user of Google applications. Including Google Apps for People, Ideas & Objects where the Wiki, blog and many other productivity and collaboration applications are available. A regular Google Account also provides the ability to monitor and control the various data types that an individual is interested in. Consisting of more then 33 distinct applications, each is capable of managing a certain element of your world, and connect you with members of your community, whatever that may consist of. 

The attribute that I find Google Applications provide is a very good example of what the alleged "cloud" provides. Up to date applications that are available everywhere. This is the next element of the always-on Internet, and represents a huge leap in software value. When applications can be upgraded once, the speed benefits more then just the developers. The iterative development of software is possible, and users are put in the driver seat and in control of the applications features and functionality. 

Apple iTunes

iTunes, the application that just keeps getting better. Music, podcasts, radio, movies and TV. All of your entertainment in one easy to use, search-able database. And if you want to purchase a song or movie, the iTunes Store is just a click away. All the sophistication that is the iTunes application is available in the easiest interface. You have the opportunity to organize and manage your entertainment in unique and innovative ways like SmartPlaylists, and the new Genius functionality. 

The attribute that I find iTunes brings is the complete management of one element of your life. Your entertainment. What I would like to see is the user, who is in control of the developments for the oil and gas producer, use the People, Ideas & Objects application as their commercial environment. The place where they earn a living. 

Apple's App Store

We've all heard about the iPhone and its applications. Independent developers and firms that are selling "cloud" based services can develop an application very easily for the iPhone. With a huge Software Development Kit provided by Apple. A developer can make an application that could be a complete home run on the iPhone for as little as $50,000.00. With a readily available market, and distribution to consumers, developers are finding access to revenue streams of up to $500,000.00 / year. 

It should be made clear that this is the first time that a developer has been able to independently invest, market and earn based on their entrepreneurial skills. There have been markets such as SourceForge and Collabnet. But those are not necessarily ways to make money. They only provide for the ability, in the open source ideal, to being involved in making much better software. 

I am doing what is possible to make People, Ideas & Objects the second market for these developers. But theirs more, much more. This is also the marketplace where users will be able to actively participate in making the software they want and need, and also earn money for the time spent on working with developers and also their producer clients. 

The services associated with People, Ideas & Objects software are licensed to the users under contract. Developers and Users are able to look to the work being done here as part of their career and for monetary gain. As I have mentioned here many times before; the total cost of a global application with the full scope of a producer firm, is estimated to be in excess of one billion dollars. The majority of those revenues are distributed to the individuals who make the software what it is. The users and developers, please join me here. 

Technorati Tags: People's Apple Google Interface Entrepreneurial

The Parallel Revolution

A YouTube video in which the presenter suggests that parallelism is the biggest computer science issue of the past 50 years. Whether that is true or not is a subject of much debate. Parallel processing has been around for almost 15 years and has been a bit of disappointment. A disappointment when we consider what is possible if parallelism could solve the problems the presenter is referring to.

The problem comes down to the speed at which the processor can do a job. The operating systems are not necessarily able to manage the priorities all of the traffic coming in for processing. When the process, particularly a business process, needs to be manage in a defined sequence over time, and particularly based on interactions by the user. There is no way in which to ensure that the sequence is taken in the proper sequence. 

This affects us in People, Ideas & Objects because we have chosen to make Asynchronous Process Management one of the four cornerstones of our Technical Vision. When we consider how the Joint Interest Billing process is completed between several companies represented in the Joint Operating Committee, we see the value in solving this problem and enabling this technology. 

The operating and capital costs of a well, facility or plant is distributed to the working interest owners on a monthly basis. In the Partnership Accounting Module of the People, Ideas & Objects application we introduce a number of new variables to make the process more effective in defining and distributing the costs incurred by all of the partners. The ability to identify and apply these new costs, on top of the innovative way it handles all costs, revenues and royalties, needs the Parallelism being discussed in this video. Various people within the firm are measuring and capturing these costs for distribution. This firm may be scattered across many geographical regions and time zones. The ability to have the process managed in sequence may take several weeks of moving from desk to desk in the paper chasing world. In the virtual world it can and needs to move much quicker. Some times things happen that have the necessary dependents not fully complete, and that would be necessary in terms of mitigating the time of all the associated processes. However, there is also a need to ensure that the process is not over-ridding previously made decisions and data in the system. The process needs to be parked if a critical aspect is needed before processing. 

Once this process is completed within the firm, it is then necessary to follow a similar process for the firms in the Joint Operating Committee. When you consider the number of costs, properties and firms within the industry you can see the complexity of this process needs to be handled in the appropriate sequence. 

Where are we in terms of resolving this problem. I would suggest we are very close to having the means at our disposal of defining the software to follow the process in this Asynchronous manner. Steve Jobs of Apple has claimed that he has solved this problem and will release the capability in the next version of their Operating System, named Snow Leopard. Java makes the management of the process possible, but a bit cumbersome. Future changes are with this idea in mind and will achieve resolution of this critical area at some point in the very near future. Making the People, Ideas & Objects application modules able to make the possibilities real, please join me here. 

Technorati Tags: People's Development Vision Asynchronous Management

The end of the paper economy.

I have commented many times about the state of the current global economy. Why do I continue to discuss these economic difficulties? This is a necessary part of the development of this software. The ways and means of the global economy are being transformed to new and more effective ways of organization. Whether that is your belief or not is not something that I am challenging. I am trying to build support for the fact that these economic and organizational changes need to be accepted by every individual that works in the oil and gas industry. Milton Friedman has best captured the point in the following comment.

Now, you never have real changes unless you have a time of crisis. And when you have a time of crisis what happens depends on what ideas are floating around, and what ideas have been developed, and thought through, and are made effective. 

I'd like to think the ideas that I have formulated in the research and writing represented in this blog are some of those ideas that are just lying around. I perceive this time as the point of greatest opportunity for individuals. Our lives will be transformed, if we take this opportunity and run with it, we could achieve more then has been possible in many generations. 

There is going to be a sizable amount of pain as the "old" dies away and the new is formed by trial and error, but mostly frustration. But it will be worth it. What was conceived of as being of value in the past, - paper assets, stocks, bonds, pensions, real estate and retirements - are falling in value and will be not be adequate for our long term needs. What is of value and what can anyone in the oil and gas industry do to participate in this new economy and rebuild their lives?

I think the new economy is going to be based on "rights". Where access too, or ownership of, rights is the basis of how an individual earns a living. At least that is my theory and I'm sticking to it. The right to use the People, Ideas & Objects software is subject to license in which the rights to the ideas of using the Joint Operating Committee are available to everyone who chooses to make a living in oil and gas. These rights and the associated software are provided for free to those who provide services to the oil and gas producer, in their own service based offering. People, Ideas & Objects revenues are sourced by those that benefit from the sales of oil and gas. Oil and gas producers and governments which have the need for the people to manage and organize their assets and provide the most profitable means of oil and gas production. Creating an environment of dependency and mutual support between those that work in oil and gas, the producer companies and government agencies that collect royalties, and the software development process and application itself.

Please, join me here in this necessary and worthwhile cause.

Technorati Tags: People's Economics Change Energy Software

Former Talisman CEO Jim Buckee

I have always valued energy based on the potential price of gasoline. My projected $600.00 / barrel translates into approximately $5.00 / liter of gasoline, which includes taxes. This would be the deal of the century if it were not for the current price of oil is around 5% of my projected $600.00 price.

This qualifies as the deal of the century on the basis of the mechanical leverage we have achieved for each barrel of oil, as calculated in the book "Profit from the Peak", is 18,000 man hours per barrel. On that basis the $600.00 / barrel replacement cost is only $0.03 per man hour. 

Along comes Jim Buckee, former CEO of Talisman Energy in January 15, 2009 Calgary Herald suggesting the price of a liter of gasoline will reach $20.00 / liter. This would make the replacement cost of one hour of man labor escalate to $0.12, what is he thinking? Dr. Buckee's reputation in the oil and gas industry is unimpeachable. Building Talisman up to approximately 500,000 barrels per day of production, $20.00 / liter is a legitimate and serious claim. 

We can all assume that the types of claims made by a former CEO would be different then one that occupies that office. Those that are the CEO's of today's organizations are guarded in their comments and would never be able to make such a claim. Shareholders and the public would run scared and frightened. A former CEO carries the credibility of the office, yet has the ability to speak the truth of the situation that they are familiar with. 

What is difficult to comprehend is the scale in which we have become dependent on 86 million barrels of oil per day. Energy production provides for our way of life and standard of living as a result of not having to be occupied with the menial tasks of our ancestors. Who amongst us will be the first to volunteer to reduce their consumption by 2% (1.72 million barrels per day). And if we can find the willing volunteers for that I am certain that we can find the volunteers for the next years 3% decline. This is a slippery slope where the end doesn't necessarily involve our survival. 

My aim is not to frighten people. I want people to join me in solving this problem by building the software that will identify and support the type of energy producers necessary to sustain, and expand our standard of living. Needless to say I find this to be an important task and would welcome those that are able to help, to please join me here. 

Technorati Tags: People's Call-to-action Energy Change

World Energy Outlook

Fatih Birol, Chief Economist and Head, Economic Analysis Division, International Energy Agency (IEA) makes a speach that is broadcast on YouTube. This speach addresses the Annual IEA Report released in November 2008. The audience for this speech is the Council of Foreign Relations. The discussion is predominately about the climate impact of CO2 produced from the use of energy. This is a disappointment as the scope of the IEA is on energy. Climate change has its own custodians and is not really an appropriate topic to take the time away from the discussion abut energy supply and demand. The energy issues alone have the potential to obscure all of the issues mankind faces. If we are faced with those dire energy related problems, will we be able to look to the IEA for the answers? Not in my opinion. If the topics of discussion are continually diverted away from energy supply to travel down obscure bunny trails such as climate change and alternative energy, we most certainly will suffer the consequences of an inadequate supply of energy.

The first part of his speech deals with the current pricing situation. Making the assertion that the supply of oil is not benefited by the decline in prices. Based on the IEA Report there is a risk of permanent damage to the supply of oil if many of the larger projects are not completed. Particularly, Mr. Fatih Birol raises his concern over the accelerating decline of existing known oil and gas reserves. Suggesting this accelerated decline risks the ability to meet market demand in the long term.

At 47:39 an excellent question is asked by "Sally  " of Columbia University. She comments that the current IEA report is a "radical departure" from thirty years of reports that suggested the supply would rise to meet the demand. The IEA Report suggests that their is a supply problem and asks if it is possible to keep supply at these levels in light of the issues that the accelerating decline curve reflects.

Who knows what the future holds. As I have mentioned before my training and experience in oil and gas is in management. I do not understand the particular nuances of what reserves are produceable or which are of value. Limiting my upward mobility in the industry. I do know, however, the amount of time, energy, money and most important of all "ideas" it takes to find a barrel of oil in the current industry environment. I also know the demand from China and India on top of the high demand levels of the advanced economies will challenge the industry on the demand side of the equation. 

I also know that SAP and the current crop of ERP systems that are in use in the industry, are inadequate to approach this problem. Supporting and cementing the bureaucracy in its well established rhythms, as is SAP's success, is the impediment to innovation, adequate supply of energy and the ability to continue on as a civilization. 

The energy supply problem is a long and difficult task for the industry to undertake. We need to take the first steps in making this happen. We live in an advanced economy where the division of labor requires thousands of people to undertake the smallest of transactions. These people are unable to know all of the necessary connections to make these transactions successful. The role of software is critical in identifying and making these people function at the optimal performance. I am suggesting we first and foremost organize the producer in a fashion that meets the needs of the industry. Now is the time to develop these systems and unleash the human resources necessary to solve these critical problems. We need to begin this new approach to the industry by changing our organizations to instill the innovation and performance that this new environment demands. Please review the  Draft Specification, and join me here. 

Technorati Tags: People's Energy IEA Innovation Peak-Oil

Louis V. Gerstner on MIT video

The Networked World: Are We Ready For It? (Click on the title of this entry to be taken to the video.)

Louis Gerstner brought IBM back from the brink of destruction. The firm had misplayed the transition from the mainframe to the PC and as a result had reduced their near monopoly power in the IT industry to an almost bankrupt company. Gerstner was instrumental in taking the firm in a new direction with profitability in software and hardware products. I think that was the right direction and the current Chairman Sam Palmisano has taken the firm toward a service based operation, which I think is a failed strategy.

Nonetheless, Gerstner's video is over six years old. The vision he lays out is exactly the same vision that most in the IT business subscribe too today. What happened? Why did this six year period pass without the changes that were obvious to industry leaders like Gerstner so many years ago.

The bureaucracy has interfered in making the organizational and technological changes necessary to see Gerstner's vision real. When the budget power resides in the hands of the bureaucracy, we see record volumes of business for the SAP application suite, because SAP is the bureaucracy. Innovation and change have been traditionally resisted by the bureaucracy, and with so much innovation and change necessary, the bureaucracy has been able to easily avoid it and hence delay its ultimate demise. It is not coincidental that this time also saw the management attain the greatest amount of control over their organizations at the expense of their key stakeholders. The bureaucracy winning is the natural outcome of this battle.

If we go back to 2002 and take the vision of Gerstner to the current point of time we can time the last six years as the point where the bureaucracy had successfully resisted the technological and organizational changes. This is also the time that the fleecing of their companies by the management, for the managements benefit began in earnest. It is reasonable to assume that at some point the methods of the bureaucracy would become to slow and too unresponsive for the needs of society. 

As I stated in the Preliminary Research Report, the collapse of the Former Soviet Union was a reflection of the demise of Russian society as a result of its organizations not able to provide for societies needs. People were unable to work when they were lined up at the bakery for food. We saw lineups of people waiting for their bread and food when the so called supermarkets were literally barren. To a large extent, as I suggested in the Preliminary Research Report, the current financial meltdown is as a result of the bureaucracies methods are unable to provide for the societies needs.

Waiting for the Great Obama to solve the financial meltdown is going to leave a lot of people disappointed. There is not enough money in the printing presses to overcome the inefficiencies of the bureaucracy. If we do not set out to build the organizations we need for the future deliberately, they will not come about. We are beyond the ability to have the corner store, where the supply and demand are local, satisfy the complexity in the economy. We depend on a globalized economy and the people that depend on each other have no understanding or appreciation who, what, where and when these interactions occur. Expecting this to generate itself is typical of the thinking that the market will provide the solution when the demand shows itself. It is clear from this video that the demand has been in existence for over six years now. The market will only provide it when action is needed and action is taken. We need to act now and make this software for the innovative oil and gas industry. Laissez-fair is no longer able to provide the types of spontaneous order that Frederick von Hayek suggested. Complexity demands that we need to act, please join me here. 

Technorati Tags: People's Organization Change Market Failure

Robert Malone, on MIT video.

Achieving U.S. Energy Security Through Energy Diversity

Robert Malone is the Chairman and President of BP America and is speaking about energy policy in the United States. Going back to the Nixon administration and reiterating some of their goals in terms of where and how the U.S. would source their energy. Stating the attempts to formulate a policy have failed, and now is the time to address this difficult situation. 

Talking about our future and the difficulty in getting people's focus on a national energy policy. Its a market economy, and I think the idea is that you get paid when you explore, develop and produce the product. Looking to the government for the leadership in making the policy changes  to enable domestic supply has provided the U.S. with nothing but the failures going back to the Nixon and Carter administrations. 

I disagree with the argument that the U.S. is spending too much on foreign energy supplies. The cost of a barrel of oil is the deal of the millennium. What the U.S. economy, the most efficient consumer of energy, is able to generate with one barrel of oil is far greater then the cost. The U.S. is the largest consumer of energy, and the largest economy in the world. We need to stop thinking in terms of the costs of energy and think more in terms of the value. This requires that we begin to understand and use energy in the most efficient methods possible to fuel our economy. One of the dumbest ways we spend our energy is in gridlock each day twice a day, in order for our supervisors to take attendance. What we need is systems that enable the user to do their jobs when and where the user is, and when the job needs to be done. This begins with the oil and gas producers sponsoring the software developments contained within the Draft Specification.

I can foresee the future user of People, Ideas & Objects waking up and logging in to the system within the first fifteen minutes of their waking. In comparison today, this simple act of logging into the system takes the average person up to 2.5 hours from their waking. The only analogy that I can draw to this foolish idea of getting to work; is having to drive back home in order to make a personal phone call. Ridiculous, join me here.

Technorati Tags: People's User Video Energy Economics