That's a five minute misconduct.

Using a hockey analogy to reflect the opposing team is indulging in inappropriate or unfair play. It's also an analogy that will be intimately understood by Sun Microsystems Chairman Scott McNeally. I'm speaking of the actions of IBM in this proposed acquisition of Sun.

Lets go back to the Microsofts offer to purchase Yahoo. I thought Microsoft never wanted to purchase Yahoo, but they certainly were not happy with having to deal with both Google and Yahoo in the critical and valuable search business. Microsoft's acquisition of Yahoo has similar anti-trust issues to what IBM would be presented with in purchasing Sun. In fact it is the management of Sun that are contending that IBM stick to the acquisition in a potentially difficult anti-trust review. This may be a key point that helps Sun in the very near future and adds fuel to my hypothesis of IBM's dirty tricks. 

If Microsoft could have eliminated Yahoo from the marketplace without spending any money, would that not be a worthwhile action to take? For IBM to walk away from Sun after reducing the offer and peaking at what Sun has under the covers, IBM quickly learned more then they otherwise would have in normal operations. Key contracts, technologies, strategies and tactics of Sun were possibly made available as a result of the offer. Walking away after this peek, after they have the goods, after they make a revised less valuable offer shows that Sun may have some big nasty skeletons in its closet. It also does not speak well of Sun's management in deferring the opportunity to fulfill their shareholders potential on a short term basis. Which introduces a conflict and concern that otherwise is unnecessary and is certainly destructive. This is why IBM needs to be assessed this penalty.

Sun is having a difficult time. They have technologies that few fully understand or appreciate. In a world where value is attributed to those with coherent sound bites, Sun looses a lot of people beyond Java. Sun also has a number of technologies that are unique and far more valuable then the sum of their parts. And that is what IBM is after. Like Microsoft wanting Yahoo's market share for search, IBM wants desperately needs Sun's technologies. 

After the introduction of the personal computer, IBM blew it, big blue time. Under Lou Gerstner, austere management and a lot of luck the firm was able to recover. But what is it that they own now? Services in the form of corporate services to companies. Few if any actual technologies, certainly not a coherent story that can be told. I ask what are the benefits of services to companies? If I buy some IBM services, how do I know that you have provided that excellent quality of services that you claim? And if they are of such high regard, why am I being asked to sign another contract? Selling services without any products is not a long term viable strategy to making money, in my opinion. 

So IBM has now put Sun into play. What ever damage that is done to Sun is of net benefit to IBM. I'm not a fan of this tactic, and I find it oddly coincidental that it's only played out by those with anti-trust difficulties. We'll see how this one plays out, but IBM should be penalized not only five minutes, but a game misconduct and a 10 game suspension. 

Technorati Tags: People's Sun Strategy

Project P.U.M.A.

"Personal Urban Mobility & Accessibility" from GM and Segway. What have they done to my Segway? I have frequently pointed to the need to stop hurling 4,000 pounds down the highway at 60 miles per hour. As one solution to the many energy demand issues. We can't afford to be spending so much energy so inefficiently. If you believe in global warming, then you should also get behind this type of transportation. Using it to replace the car in your daily commute. And relegating the car to one or two days per week.

There is a large amount of talk in the blogs about PUMA. Segway have a blog that I subscribe too and they had three announcements today. You can read these here, here and here. Another one of the better sources of information is Fast Company. During the announcement Larry Burns, GM's VP of R & D says it well.

It'll be one-quarter the cost per mile, he told journalists. This is a vehicle that runs on electricity made from a wide range of sources, and because it's so small, it's efficient--it's approaching 150- or 200-gallon [tank] efficiency.

Note he doesn't call it a car. Those that have issue with the looks, I suggest it looks like any of GM's products. Me I'll buy a Segway as soon as all the insane city councils make it legal for them to be driven on streets and sidewalks. Also the TED Conference highlighted archive video's of Dean Kamen, who invented the Segway, and Larry Burns talking about his ideas in the car business. 

Technorati Tags: People's Energy Summary

"From Bubble to Depression?"

Professor Vernon Smith is a Nobel Laureate with an article in today's Wall Street Journal. His analysis rely' on the qualitative, and this article doesn't disappoint. Two comments that stand out, and that show the economic situation we are in is unique and historical. Relating the current experience to the great depression, he writes.

Had the mounting difficulties of the banks and the final collapse of the banking system in the "Bank Holiday" in March 1933 been caused by contraction of the money supply, as Milton Friedman and Anna Schwartz argued, then the massive injections of liquidity over the past 18 months should have averted the collapse of the financial market during this current crisis.

and

The causes of the Great Depression need more study, but the claims that losses on stock-market speculation and a monetary contraction caused the decline of the banking system both seem inadequate. It appears that both the Great Depression and the current crisis had their origins in excessive consumer debt -- especially mortgage debt -- that was transmitted into the financial sector during a sharp downturn.

The cause and remedy of the great depression is a topic that I am not satisfied that we have discovered the answer too. There are too many variables and actions that occurred over a decade of experimentation, trial and error. Professor Carlota Perez is someone that I have written about extensively on this blog. Her long wave economic analysis' and theories resonate with me. Suggesting that the old economy is no longer capable of meeting the demands of society. And that new technologies have matured and are readily available to take the weight of the "old" work horses.

I include the bureaucratic method of organization as one of the innovative technologies of the past century. Alfred Sloan, then CEO of GM used it to great effect in establishing the firm in its hey day. That technology can't provide the speed and innovativeness that is necessary for our current and future societal and individual needs. It is a form of economic organization that does not provide any further value, and I would suggest is the reason that much of the value in today's economy is being incinerated. 

Using the Joint Operating Committee provides a strong understanding of how better to organize the energy industry. Inherent in that understanding is the use of the Information Technologies that are readily available, and Professor Perez suggests are ready and able to begin to provide the value in society. Now is the time that change is being demanded of our economic ways and means. I would suggest that the economy will only commence the building of value again when we build the systems to support the innovative and speed capable oil and gas producer. 

In a related note, Shell was downgraded to neutral by Merrill Lynch due to "the groups [lack of an] ability to grow production". Just as BP and Chevron were downgraded yesterday, Shell could probably use a new method of organization, and capability based software developer, please join me here. 

Technorati Tags: People's Perez Economics Change

Professor James Hamilton on energy.

Professor James Hamilton writes the popular and often cited weblog www.econombrowser.com. (Click on the title to download this paper.) I have highlighted many of his writing in the left hand column of this blog, his writing is clear, comprehensive and based on fact. Through the Brookings Institute he has published a paper entitled "Causes and Consequences of the Oil Shock 2007 - 2008". The abstract to this paper reads;

This paper explores similarities and differences between the run-up of oil prices in 2007-08 and earlier oil price shocks, looking at what caused the price increase and what effects it had on the economy. Whereas historical oil price shocks were primarily caused by physical disruptions of supply, the price run-up of 2007-08 was caused by strong demand confronting stagnating world production. Although the causes were different, the consequences for the economy appear to have been very similar to those observed in earlier episodes, with significant effects on overall consumption spending and purchases of domestic automobiles in particular. In the absence of those declines, it is unlikely that we would have characterized the period 2007:Q4 to 2008:Q3 as one of economic recession for the U.S. The experience of 2007-08 should thus be added to the list of recessions to which oil prices appear to have made a material contribution.

I recommend people download and review the comprehensive nature of this paper. This is an individual who, with tenure at the University of San Diego, and an impressive global following has nothing to gain or lose by saying what is said. This is the first paper that I have seen that confirms the concern that all should have with respect to our energy demands.

We see the political leadership continue down the road to energy alternatives. I would expect these moves will be short lived as the reality of their stupidity begins to show. If they are truly concerned about the CO2 that oil and gas production and consumption produce. What will their move to electric cars with lead acid or lithium batteries recharged by electricity generated by coal do. A little rational thinking from alarmist politicians would show them the demise of the landfill and the far more polluting coal. 

The solution to these problems does not involve a car. To move away from internal combustion engines to electrical can never happen. The costs would be formidable. Transportation should have a priority on the oil and gas resources. People, should begin skipping the 9 to 5 commute, and keep short trips to the Segway. People, Ideas & Objects are a big part of how these problems can be approached.

A key finding of Professor Hamilton's includes:

The most important principle for understanding short-run changes in the price of oil is the fact that income rather than price is the key determinant of the quantity demanded. p. 1

In a related item Bloomburg is reporting that many of the difficulties the major producers are having in increasing their production profiles. It sounds to me they need a new more innovative organizational construct supported by a capability based software developer. Please join me here.

Technorati Tags: People's Hamilton Energy Research Economics

Energies difficulties

There are a number of articles pointing to what I feel is the big problem that we face. The energy problems that we were dealing with last year seem somewhat distant. It appears there is a general consensus that the high energy prices were a result of market manipulation. Nothing could be further from the truth. Energy issues are being forgotten and obscured by our current economic condition.

It's therefore pleasing to see that many organizations are discussing what I feel is the big problem that we face. McKinsey Global Institute have published a series of articles about energy and do a good job in laying down the basics of the problems. Their articles are part of a series "Averting the next energy crisis: the demand challenge".

The same message is being articulated by Daniel Yergin and his Cambridge Energy Research Associates. Suggesting there is a destruction in our capabilities in terms of energy production. Although I consider CERA's projections to be far too optimistic. Even they are suggesting a loss of up to 7.6 million barrels of oil per day will be lost as a result of the decline in capital spending. Matthew Simmons of Simmons Consulting captures the point in the following article .

The global financial crisis and collapse in the oil market have stalled vital investment in oil exploration and production and are likely soon to lead to a sharp spike in prices, an energy consultant and financier says.

The economic conditions continue to deteriorate and will do so for some time. The Economist is stating that "Trade is Collapsing Everywhere" showing the unique size and scope of the problem. Expecting that the economy will be able to be stimulated back to its previously un-sustainable level, is wrong. We need to be focused on the issues that we can solve. The energy problem being the most important.

We need to start the process of building this software to support the Joint Operating Committee. Without first organizing ourselves to take on the challenge of supplying the market demand for energy, we will fail. Our organizations have proven beyond reason to be incapable of meeting the challenge we face. Does anyone believe SAP and the bureaucracy will enable our organizations to do the job? When we look at this situation form a long term perspective we see what our priorities are. Please join me here.

Technorati Tags: People's Economics Developments Yergin Simmons

The rise of virtual service grids.

I found this article on the dzone.com web log, click on the title of this entry to be taken to the article. It is a reprint or summary of a book about Service Oriented Architectures (SOA). It has an interesting point of view regarding the changes that are occurring due to what they call the "virtual service grid technology". The conclusion states;

The changes brought by virtual service grid technology will likely transform the information industry in ways that are difficult to fathom from our present day vantage point. We are essentially at an inflection point defined by two forces: the transition from an up front investment model for IT requiring large capital outlays to a pay-as-you-go model. Market elasticity dictates that when price points go down, demand increases, partly due to pent-up needs, but perhaps more so because new entrants enter the field who could not afford to play before. This means increasing participation by the members of the "long tail" of cloud computing: small businesses, emerging markets and even individuals coming up with a great idea.

Second, the acceleration of the time it takes to build an application by orders of magnitude means the evolutionary process gets accelerated by the same rate. The evolutionary refinement of hundreds of generations taking place in the same time it took to develop a traditional application is mind boggling. (See also 1 , 2)

I try to stay away from getting too involved in the technical attributes of People, Ideas & Objects. Other then the Technical Vision, I prefer to stick to the business reasons to be developing the applications modules.

I also maintain that the future earnings of anyone working will be generated through the ownership or access to Intellectual Property (IP). The entirety of the IP of People, Ideas & Objects is available to the Community of Independent Service Providers through a license. Those that will be successful in the Community of Independent Service Providers will be able to use the IP in combination with their unique service offering. Providing a hybrid styled source of revenue for their firm.

The second point in this articles conclusion is something that has not yet been proven, but will be soon. Standing on the shoulders of giants has been a term in academia that reflects the ideas are built on the history of many ideas up to that point. The same concept is about to be realized with respect to the ability to build off of the extensive infrastructure of the Java Programming Environment. Many of the difficult and complex attributes of systems development have been standardized and developed.

With reasonable royalty payments to Sun for the use of Java, a development project with the scope of People, Ideas & Objects accesses many of the components that will make the majority of the process management and functionality from Sun's various software products. With out being too specific this substantially eliminates the time necessary to develop systems. Today the real key to the quality of these systems is the end users involvement. Please join me here.

technorati tags: People's CISP Vision Java User

Martin Feldstein and Simon Johnson on MIT Video

MIT has released a video of Professor Martin Feldstein and Simon Johnson from February 11, 2009.  (Click on the title of this entry.) Feldstein is the former and long time president of the National Bureau of Economic Research where he was responsible for defining the time frame of when a recession occurred. He is also a Professor at Harvard and a frequent speaker in many of the conferences and forums where ideas, problems and solutions are discussed. Simon Johnson is an MIT Professor and former Chief Economist at the International Monetary Fund. He is also an author of an excellent blog that can be sourced here.

They are of course discussing the current global economy and what can be done. Both are quite pessimistic, and rightly so. The solutions that are discussed are very complex and of questionable value. We are well within the point that the cumulative of the stimulus should have worked, yet are constantly bombarded by an additional trillion here or there. We therefore are very close to the point in time where the majority of the people will realize that not only have the bureaucracies in business failed, but their government has failed as well. 

I have stated here many times that these economic events are part of the long term economic cycle. Based on the Shumpeteerian creative destruction, and specifically Professor Carlota Perez. Her analysis is based on her research of the last 300 years. I highly recommend reviewing the Perez label on this blog to understand the natural process of the old moving out of the picture and the new, in this case Information Technology, pulling the weight of the economy. 

All seems to be going to plan, exactly as Professor Perez stated in 2005. Providing the best reason of all for getting involved in People, Ideas & Objects, so please join me here . 

Technorati Tags: People's Economics MIT Video Perez

IBM's advertisements

Many of the newspapers have been sporting a series of ads from IBM. The first of these is "A mandate for change is a mandate for smart." You know that a trend is well ingrained when the large suppliers are on board. With their recent announcement to purchase Sun Microsystems and being on the same song page that we are, there may be hope for their future.

They not only are on the same page, but they also get it, comments like this are the appropriate mindset for the economic conditions and times that we find ourselves. 

Right now - today - leaders of businesses and governments everywhere have a unique opportunity to transform the way the world works. 

The means that IBM suggests this is possible is;

First, the world is becoming instrumented. Imagine, if you can, almost a billion transistors for every human being. Sensors are being embedded everywhere: in cars, appliances, cameras, roads, pipelines... even in medicine and livestock.

Limiting the People, Ideas & Objects application to a technical perspective we see IBM's comments are consistent with our technical vision . 

Second the world is becoming interconnected. Like people, systems and objects can now "speak" to each other, producing oceans of data.

A further extension of our technical vision in which we note the crush of data will begin with the introduction of IPv6. I also like the comment about people, systems and objects and the similarity to our People, Ideas & Objects name. 

Third, all of those instrumented and interconnected things are becoming intelligent. They are being linked to powerful new back-end systems that can process all that data, and to advanced analytics capable of turning it into real insight, in real time. 

At times I find it as difficult to figure out if IBM is selling something or talking about something in the future. I think I should cordially welcome them to the vapor-ware market. There comment that they want you to join them in building a smarter planet. Welcome to the party IBM, pull up a chair and start pulling some weight if your serious. 

Technorati Tags: People's Vision Sun Trends

Workforce 2020

Another Strategy + Business article talking about the impact of Information Technologies on organizations success. (Click on the title of this entry) This "Leading Ideas" article is subtitled;

For many companies, success in the next decade will depend on how well they implement information technologies that transform when and how people do their jobs.

People, Ideas & Objects falls well within the scope of this article. The work force is changing, mostly as a result of the changes driven by the current poor economy. I would expect that this economic trend will be augmented and supported by further calls to change driven by IT. This article provides us with an understanding of the scope of the challenge that is in front of us.

If business decentralization is a long-running trend with more stutter-steps than successes, it’s primarily because the technology to make decentralization work deftly has yet to be perfected or adopted by skittish organizations unwilling to fully take a chance on the unproven. But by 2020, innovative competitors — and inevitable gains in remote, mobile, and virtual devices — will make it impossible for most companies to deny that information technology is profoundly reshaping the workplace. By then, in many businesses, workers will no longer be bound by geography or by clocks.

First off the understanding that an innovative mindset is to try many things and discover many of the reasons that it won't work. These will be applied in this development process and enable us to approach this challenge constructively. This applies to the oil and gas industry and specifically to the earth scientists and engineers that will / are finding their volume of work growing.

The article rightly notes the geographical and time driven needs of a nine-to-five existence will become a thing of the past. The Draft Specification considers the "always on" and greater flexibility in a workers schedule are necessary for the future. Weather this is a demographic change or a reality brought on by the futile need to be in your office at 9:00 is unknown. I think the motivation to do so will be as a result of the existing technologies and the reality of the economic consequences of not changing. How this happens is also captured in the following;

The blended workforce. Over the next decade many employees won’t be employees at all; they will be temporaries, contractors, contingent workers, outsourced workers, freelancers, and, in business-to-business transactions, customers. Today, there are more than 42 million independent workers in the United States, or about 31 percent of the workforce.

The trend is well on its way and unstoppable. This is more of a quality of life issue with respect to the workers within the various industries. It should be asked how the oil and gas industry, already challenged with, a shortage of workers, retirements, increased workload per barrel of oil and gas and now competition on a worker quality of life issues. Good luck trying to hire people who are expected to use SAP or other bureaucratic supporting systems. But then again, I am biased. This trend will also bring new issues into play.

With outsourcing sure to be even more common in the future, managers will have to pay attention to project hand-offs and coordination costs between partners.

Something that should be considered is the specification and design of the People, Ideas & Objects application modules.

To keep their blended workforce happy, they will also need to create interesting work in an engaging workplace and pay workers’ invoices on time or risk exacerbating turnover, creating yet another fissure through which knowledge can drain.

As I indicated yesterday, the oil and gas producers have much to gain in getting involved in People, Ideas & Objects. Progress is being made on a day to day basis in Internet time. That is to say the accelerated pace of change of the Internet is the time table this project is following. I'd like to think the producers are progressive enough to start pulling some of the weight of this project.

Technorati Tags: People's Call-to-Action Funding Development Trends

Where are the major producers

I want to clarify that everyone involved in the oil and gas industry is affected by the changes in moving to the Joint Operating Committee. It is important that everyone has some representation in which to have their concerns and needs aired and met. What I mean by this is that the individual who conducts the billing of NGL's for a major producer, has the say in how and what their job involves. How it can be improved and integrated with the many new and innovative ways that are incorporated into this system. 

The Joint Operating Committee (JOC) is systemic and culturally ingrained, therefore it applies to global oil and gas industry. It affects producers, suppliers, governments and most of all People. Everyone needs to be represented. The objective of this systems development is to ensure it and the Community of Independent Service Providers provide the oil and gas producer with the most profitable means of oil and gas operations. 

One of the deliverables in the Preliminary Specification is the geographical reach of the application. The minimum has been set in the Draft Specification as to handle North American needs. What about the other regions. Most of the intermediate and larger producers have a global reach. These producers have to be involved in making these decisions. As the Preliminary Specification is the current task at hand, now is the time to get involved. 

So where are the major producers?

Lets look at their choices. Currently SAP and Oracle are in the marketplace as providers of ERP systems to the producers. Are these producers happy with these limited options? Are they pleased with the costs and never ending difficulty in making even the slightest changes? What are SAP and Oracle's business models? Will these be affected by the economic changes that all organizations should be contemplating? I think it is reasonable to suggest these software developers business models are fine and they know they have the upper hand in ensuring their future profitability. Is this "plan" of continuing to use these applications adequate to meet the escalating needs; in terms of the earth science and engineering that is necessary for each future barrel of oil?

What will the year 2020 look like? What will the demands for energy be? How will firms operate in a world that may be fundamentally different from what we experience today? Have producers the necessary systems in place to support the innovation and change dynamics for this time period? Without People, Ideas & Objects I believe they don't. Energy is the life blood of any advanced economy. With out an abundance of energy, we will not fulfill our potential. It is these points that I would suggest are possible as a result of having all parties come together and build the People, Ideas & Objects application modules . 

In light of the oil price run up, the major producers are flush with cash. As a result of the current down turn, I see little downside in reviewing their operations during the development. Therefore what is the risk of putting resources toward People, Ideas & Objects? What would they get for their investment?

• A system based on the vision of the Draft Specification.
  
• Coverage of their geographical areas of operation through input in the Preliminary Specification.
  
• Producer can be in the front row in terms of working with users to develop innovative ways and means of defining profitable operations.

So whats the hold up? The economy is changing. Moving away from the focus on this quarters performance and more towards a longer term perspective. I hope so, that is to say we need the producers to be involved but not just for the next quarter. How is it that we can progress over the long term with a sustained effort without producers resources? How do we ensure that producers are committed to this project for the long term? This is the big question that I have no solution for at this time. 

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