Security Module.

I last wrote about the Security Module in October 2006. Now that we have established the general framework, or the infrastructure of the system, and indeed I have begun building the parts into a usable system, I now want to formally start the software development. As I noted in the October 2006 posting the security module would be the first item of development, therefore, I can now declare on Tuesday September 18, 2007 that we are indeed in development.

A few of the bits that we will be using as our infrastructure are Google Apps for People, Ideas and Objects, and Java Web Start and Java Swing. So lets start with that and build from there.

Google Apps for People, Ideas & Objects.

www.people-ideas-objects.com is the domain (and company name) that has been selected for this project. This is now operational on Google Apps and I am very pleased with the fit and finish. Key to their offering is the ability to integrate a Single Sign On (SSO) for the entire domain. Once the user is logged in through Google apps they will have access to the collaborative environment and application specific functionality. Recently Google announced the closing of their acquisition, Postini. Google will now offer a level of security that is in my opinion second to none.

With Postini Solutions, you can secure all of your electronic communications - email, instant messaging and the web – and manage your company's communication policies from one central location. Postini Solutions can also make it easy to meet your archiving and encryption needs.

Best of all, it's all 100% hosted, so there's no hardware or software to install or maintain. Whether you're looking to transition from or enhance your existing messaging infrastructure for better control, Postini enables you to provide employees the tools they need to be productive while reducing the cost and complexity of managing those tools.

I can now say unequivocally People, Ideas & Objects has the most secure communications of all ERP systems. ;-) To my way of thinking, lets up the standard to a higher level.

As I noted in the security module definition last October, Sun's new Solaris Z File System (ZFS) and elliptical encryption would be used for all of the data and information on the server side of the system. ZFS provides a level of journal-ling that will add real value to the users of this system. Apple have integrated Sun's ZFS in their next operating system (Leopard) release. Sold as the "time machine" feature, it enables a user to look at the various iterations of the file from the beginning to the most current version. The user will then have tools that will enable them to select the best version of the file. Secondly ZFS is 128 bit, just as IPv6, allowing for an unlimited addressing capability.

These points will be the first elements that will be developed. Google Apps for People, Ideas & Objects will be upgraded with the Postini functionality, and the Solaris based server side will implement ZFS and Sun's elliptical encryption as base for all operations from the Operating Systems, Java, Network, Database and File.

Java Web Start and Java Swing

Integration of Single Sign On (SSO) between Google Apps and the server side will provide the secure collaboration environment and the secure "Cloud" based operations. This will all be wrapped in a package that the user will be able to access anywhere and anytime with any capable computer. For the initial downloading, Java Web Start, Swing and other components of the People, Ideas & Objects application will be a minor issue with the bandwidth that is available today. The "environment" this creates is one that meets the highest level of security for any and all programming environments. Java was selected for its adherence to strong typing and inherent security model. No other programming environment comes with this standard of security. Even Microsoft's .net environment cautions the user about the inherently weak security model.

Java DB

Embedded within Java Web Start and Java Swing client environment is Java DB, a relational database with a small footprint. Originally developed by IBM it was open sourced and made the default client side database for use in Java environments. This database will hold the environment and other variables of each user, and much of the client specific data the user has used, cached, collaborated or searched from their user account. Recall that we have selected the Ingress Database for the "Clouds" database. All the data from the Java DB will be replicated with the Ingress database. Additional search facilities of the server side or "cloud" environment have not been resolved at this time. Recall I was looking into the use of Enterprise Search and security firms to assist in this area.

This area is complex and daunting, however, the need for bullet proof systems in terms of reliability and security are necessary for the enterprise. Particularly in the manner and method that they are being used here. Much of this architecture has not been implemented in any industry. Lastly I would point out that if a user were to access their system on a public terminal or a machine in which they have only temporary use of, the application and data would be inaccessible to any prying eyes after the user had left. With encryption and Java, the systems variables would be persistent only in encrypted form.

IPv6

Recall we have instituted the IPv6 protocol as part of the Technical Vision for all Internet communications for People, Ideas & Objects. IPv6 is available to us through our ability to secure a Tier 1 vendor of bandwidth. Almost all computers are capable of handling the protocol. The security model of IPv6 adds elements of security at the protocol level and includes these technologies.

Specification

These specifications will be encapsulated into one Web Service where the user, upon authorization and integration into the system, will have seamless access to their information. The reason this is the first module being built is that everything will need to be built upon it. To retrofit this level of security to a current application would be more problematic and costly then it would be worth. I am pleased that I can specify this level of security at relatively little cost. (A reflection of how systems have developed in the past few years.)

The primary issue of what needs to be resolved is the restrictions on use of high-level encryption systems in countries that are unable to access and use the high level encryption algorithms. The work around may involve limiting the users to the countries that are authorized to use these types of systems. Our focus being Calgary, Texas and Aberdeen Scotland, limited issues with the systems use outside of these three countries will limit the risk of using these algorithms.

Thankfully much of today's technological development environment closely replicates Leggo, define it, get the parts and build it. Where we go after the security specification will be to adopt the data model from the Public Petroleum Data Model (PPDM), tune it and test it, and from there we can start building the Petroleum Lease Marketplace functionality.

Technorati Tags: Genesys, Security, Development, Java

The same, but different.

First there is an article in the Wall Street Journal energy blog about $100 oil. In it the following comment is made;

“The two arguments against $100 oil, the ability of technology to raise new supply and the ability of price to limit demand, are falling quickly by the wayside."

This blog entry is going to address the differences between what I am writing about and the assumption that technology will ride in to save the day. To do that, I want to refer to an article posted in the "ArchDruid Report" by John Micheal Greer. Firstly the "ArchDruid Report" is a blog that everyone should subscribe to, the quality of his entries are second to none.

Secondly, it is important to recall that Peak Oil, as a theory, is statistical in nature. Denoting that 50% of the overall supply of oil has been produced. The other 50% of the oil remains in the reservoir and needs to be produced. These last few barrels require the producer to innovate on the sciences and learn new ways in which to produce the oil and gas. Much of these barrels are located in remote areas and can come in different forms. I would however, not count the tar-sands as reserves that fall into the traditional 50% of remaining reserves. I think Peak Oil can safely preclude the tar sands reserves from the calculation and effectively consider those resources a bonus. I believe the innovation necessary to produce the remaining 50% of oil and gas reserves will require significant technological increases in the earth science and engineering disciplines. The increase in the science and the associated innovation will only come about after a reorganization of the industry around the Joint Operating Committee. (JOC) This reorganization needs a dedicated software development capability, the purpose of this blog.

The great technology hope is addressed well in John Greer's blog entry "Innovation Fallacy". In which he uses a science experiment to draw an analogy of why the hope of some great technology will save the day is truly misguided. I agree with him that this technological wonder thinking is misguided, and feel the need to assert the difference between what I am writing about in this blog and the hope of some great technology.

I would add to John Greer's point that the installed base of gas furnaces and internal combustion engines makes the change to any other type of technology very costly as well as daunting. How anyone could retrofit the industrial infrastructure to a new technology in less time then the past century it took to install today's infrastructure, would be dreaming. The thoughts that food could be converted to energy is an either / or situation. We either eat or we drive, your choice. This discussion needs to be more openly debated to help the majority of people understand the true marvel of engineering that mother-nature has provided us in the oil and gas endowment. The ArchDruid Report accelerates this discussion.

I would also add that best analogy that I can think of is that you had 300 workers doing a job. Paying them enough for adequate food and housing is the cost of getting the work done. We need to think in these terms and learn that the value of mechanical leverage available through oil and gas is significant. The ability to replace those 300 workers with one 200 horsepower forklift using 10 gallons of gas / day brings into focus the true dependence we have on energy. Without it we are dead, or at least the civilization we are currently familiar with is. I hope the energy industry will soon adopt this thinking so that we can get on with the thinking necessary to produce that last 50%.

Technorati Tags: Genesys, Alternative, Energy, Peak-Oil, Organization

Innovation through Global Collaboration: A New Source of Competitive Advantage

August 14, 2007

Alan MacCormack, Harvard Business School

Theodore Forbath, Wipro Technologies

Peter Brooks, Wipro Technologies

Patrick Kalaher, Wipro Technologies

This software development projects purpose is to create a transaction supported collaborative environment. The first steps in building this were initiated last month with the decision to use "Google Apps for your Domain." For a small annual fee we provide the user with a comprehensive collaborative platform. Recently CapGemini has announced a deal where they provide the integration of users work environments from Microsoft products to Google's. I think, based on my understanding of collaboration, Google Apps most closely replicate the way that work gets done. I find their product fit and finish as solid as Apple's, the move to Google App's was completely painless and instantaneous.

Why is this product category so important and what is a "transaction supported collaborative environment"? The product category is important because the next level of intellectual and social interaction can be facilitated in the software. So how and who will get the work done are important, but most importantly is that the aggregate intelligence of the group be represented in the actions the software provides. In answer to the second question of what are transaction supported collaborative environments?, well they don't exist yet and that is what I want to start building here for oil and gas. This working paper is available from Harvard Business School and begins the difficult task of identifying the needs of a "transaction supported collaborative environment" and the importance in innovation.

Abstract

One of the things that I have learned since being heavily exposed to collaborative environments is they are difficult, and the approach is never the same. Just as people are different, each collaboration is. The ability to proceed with preconceived notions just doesn't work. The need to adopt a flexible framework from the beginning and throughout the discussion is mandatory. How is it that collaboration brings the wisdom of the crowds? I think the authors begin to define it in this paper, so lets jump in with a clear definition of how collaboration is beginning to be used in industry.

Instead, innovations are increasingly brought to the market by networks of firms, selected for their unique capabilities, and operating in a coordinated manner. This new model demands that firms develop different skills, in particular, the ability to collaborate with partners to achieve superior innovation performance. Yet despite this need, there is little guidance on how to develop or deploy this ability.

This comment is consistent with the vision of this development project. As I have noted here in my research; the software defines and supports the organization. Before you can make a change it has to be implemented into the software first. Recognizing the JOC as the market structure of the industry will require software to be defined in order to mitigate the detrimental effects and enhance the benefits of collaboration.

This article describes the results of a study to understand the strategies and practices used by firms that achieve greater success in their collaborative innovation effects. We found many firms mistakenly applied an "outsourcing" mindset to collaboration efforts which in turn, led to three critical errors: First, they focused solely on lower costs, failing to consider the broader strategic role of collaboration. Second, they didn't organize effectively for collaboration, believing that innovation could be managed much like production and partners treated like "suppliers." And third, they didn't invest in building collaborative capabilities, assuming that their existing people and processes were already equipped for the challenge. Successful firms, by contrast, developed an explicit strategy for collaboration and made organizational changes to aid performance in these efforts. Ultimately, these actions allowed them to identify and exploit new business opportunities. In sum, collaboration is becoming a new and important source of competitive advantage. We propose several frameworks to help firms develop and exploit this new ability.

Facing "peak oil" the energy industry has no option to dabble in this area. This has to be a concerted effort to make these changes. Success is not an option and the time to change is now.

Introduction

I have shared my concerns with how the individual companies within the energy industry do not share the sense of urgency or concern for the overall supply of oil. Theirs is a commercial operation that is operating at record profits. The decline in their reserve base and production profile are an inherent part of the business and they are doing just fine. How this system gets built is a question I face every day. Individually, people within the industry comment that the idea of using the JOC is the right thing to do, however, no company will step up and make the first move. Its the worst Mexican standoff anyone could imagine. Irrespective of the reasons regarding innovation and the need for greater speed from an operational point of view. The new technologies are beginning to finally be assembled into their final parts. The capability and comprehensive nature of the offerings are now complete in terms of the needs for a system that is built for the purposes here. And that is the point of the authors in this next section.

This new model is being driven by a series of trends forcing firms to re-think traditional approaches to innovation. First, the complexity of products is increasing, in terms of the number of technologies they include. No longer is it possible for one firm to master all these skills and locate them under one roof. Second, a supply of cheap skilled labor has emerged in developing countries, creating incentives to substitute these resources for higher-cost equivalents. Third, different regions of the world have developed unique skills and capabilities, which leading firms are now exploiting for advantage. And finally, advances in development tools and technology combined with the rise of open architectures and standards have driven down the costs of coordinating distributed work. In sum, collaboration is no longer a "nice to have." It is a competitive necessity.

If peak oil is not a compelling call to action, possibly this technological trend should be.

Collaboration is not "Outsourcing"

I have written extensively about Professor Richard Langlois' theories around the boundaries of the firm. How the natural tendency is to have either the market or the firm be determined and configured to be the means to lower "transaction costs". And how today's Information Technologies can provide for lower transaction costs in a contractual or market environment. The authors provide further justification and clarification of how these changes are strategic and not inappropriate approaches to outsourcing.

Our study revealed dramatic differences in the performance of firms collaboration efforts, driven by contrasting approaches to their management. In particular, many firms mistakenly applied a "production outsourcing" mindset to collaboration, viewing the use of partners only as a means to achieve lower costs through "wage arbitrage" - substituting a US resource with a cheaper one of equivalent skill.

By contrast, successful firms went beyond simple wage arbitrage, asking global partners to contribute knowledge and skills to projects, with a focus on improving their top-line. And they re-designed their organizations, to increase the effectiveness of these efforts.

Managing collaboration the same way a firm handles the outsourcing of production is a flawed approach. Production and innovation are fundamentally different activities - while the former seeks to replicate an existing product at low cost, the other seeks to develop something entirely new and valuable. In addition, outsourcing and collaboration have very different objectives. Outsourcing involves producing a commodity asset or resource at the cheapest prices. Collaboration, by contrast, entails accessing globally dispersed knowledge, leveraging new capability and sharing risk with partners.

Firms which managed collaboration using an "outsourcing" mindset made three critical errors, as compared to more successful organizations:

• They didn't consider the strategic role of collaboration, but saw it only as a tactic for reducing cost. As a result, their efforts were misaligned with their business strategy.
• They didn't organize effectively for collaboration. Instead, they treated partners like suppliers of parts or raw materials, and manged them using a procurement function.
• They didn't make long term investments to develop collaborative capabilities. Instead, they assumed their existing staff and processes could handle the challenge.

In combination, these errors meant firms systematically missed opportunities to use collaboration for competitive advantage. By contrast, successful firms found that attention to these critical areas generated new options to create value that competitors could not replicate. Below, we describe the principles that these latter firms employed.

Develop a Global Collaboration Strategy

A brief summary of where I foresee collaboration being used in the energy industry. The JOC may represent a property in any location, owned by companies registered in different countries and with different product knowledge and capabilities. The pooling of each producer's resources through the collaboration should be the first order of business. Having one company designated as the "operator", I think, is not desirable nor very productive. We see independent silo's representing the capability to conduct operations all around the world. And these capabilities are all duplications of one another and mutually exclusive to the needs of the various JOC's. With the shortfall of engineering and earth scientists in oil and gas, the ability to virtually pool individual resources necessary for the operation, based on the operations need is what the objectives should be. This is in line with the thinking of the authors of this Harvard document. The market of suppliers, vendors and contractors should interact with the JOC to support the operation and implement its plans for the facility or single well. This virtual environment supported and defined by the software, built for the energy industry by its users, and conducts the transaction requirements, the knowledge management and governance of the decisions made by the JOC. This is a very brief summary of this software developments proposal and I would recommend the review of the archives of this blog for further clarification of these ideas. Nonetheless, it is obvious to most that the need to have a purpose built system with a dedicated and focused software development team be deployed to make this application real.

The authors continue with the discussion of how their study reflected on two different strategies towards collaboration. I think it reflects my optimistic view of collaboration being a productive tool for management, and if the management see it as a threat or just another trend to be followed, they may miss many of the benefits.

Collaboration received little senior management attention; when it did, it was because expectations were not being met.

Leading firms, by contrast, developed an explicit strategy for collaboration, designed to support their business goals. In contrast to organizations that viewed collaboration only as a tool for reducing cost, these firms considered a variety of more strategic benefits, in particular, assessing how collaboration could improve their top line through increased product differentiation. Successful organizations achieved this in two ways: first, by leveraging a partner's superior capabilities (i.e., know-how that the firm did not possess internally); and second, by accessing a partners contextual knowledge (i.e., knowledge that the partner possessed by virtue of its local position). In combination, these benefits comprise the "3C's" of a global collaboration strategy.

The authors continue to assert the need for management buy-in. For the energy industry to succeed in this software development proposal there has to be a high level of commitment to it form management. I think the salient warning from CapGemini about these technologies affecting operations today is something management should think clearly about. Are these back door solutions to be stomped out, or should they be welcomed and supported as legitimate methods of achieving the necessary work. I also believe the time for these types of solution to be built and prospectively developed is drawing close. Management needs to get behind this with the long term perspective of developing these types of systems for the next 3 - 4 years.

Lowering R&D Costs

Leading firms however, lowered cost in a different way. Rather than swap one resource for another, they "reconfigured" their operations to optimize performance at the system level. While the decisions they made in isolation, sometimes appeared to add cost, these firms understood the need to change the way they organized to maximize the value of collaborative efforts.

Leveraging Superior Capabilities

Leading firms focused greater attention on how to leverage partner capabilities. We observed two broad types of capability in action: First, the ability to rapidly bring online large amounts of capacity, allowing firms to lower time to market and increase responsiveness, while avoiding the cost of full-time staff; and second, the ability to access unique competencies, technical know-how and / or process expertise that firms did not possess internally. Successful firms sought partners with a blend of both abilities, giving them instant access to a repertoire of skills not available in-house. As one manager recalled, "It takes us nine months to find and hire a new employee. But using our partner, we staffed up in two weeks, accessing a skill that we don't have internally."

Thinking Strategically

Thinking strategically is the point that I have tried to make. Clearly the easy oil is gone. The costs associated to produce one barrel of oil are increasing in lockstep with the costs of discovery. The amount of engineering and earth science effort per barrel of oil has probably doubled in the past 5 years. And it will continue to increase, not decrease over time. With the shortfalls in human resources today, I believe Adam Smith's division of labor theory will provide the additional resources necessary for the industry to deal with the difficult problems ahead. A reorganization around the JOC is 100% in compliance with the cultural framework of the industry. Pooled human resources, supported by markets will provide the productivity increases that Adam Smith's theories provide. A theory which has been proven correct for hundreds of years. This organizational change can not be implemented without the software defining and supporting the industry. Without the software a firm will be relegated to manual systems or loss of the opportunities I just wrote about. These are the associated choices for management today and the point of the authors.

To Illustrate, consider the strategies of two firms - A and B - depicted in Figure 2. Initially, firm B has a dominant position, with lower cost and superior differentiation. But firm A has identified opportunities to improve its position through collaboration. It can move along the horizontal to position C, achieving lower cost, or along the vertical to position D, achieving superior differentiation. Or it can move to position E, which is superior on both dimensions. In essence, collaboration has the potential to move firm A to the "frontier" of the space joining C,D, and E. Contrast this with a firm that views collaboration only as a way to lower cost; this firm sees only one position to move to. While this may be a good choice, this firm does not see that it is not the only choice.

That although I have stated the reorganization to the JOC is consistent with the culture of the industry. The culture of the industry is a very competitive one. The ability to compete and succeed in oil and gas takes a certain capability and understanding that many have stated as being second only to NASA in terms of complexity. From my 30 years experience, I agree. Changing this competitive culture to one of co-opetition or whatever buzz word that comes along will be difficult. In line with this thinking I have suggested that the land base and the companies research and development capabilities are their future competitive assets. Moving to this thinking will take time, and indeed, may never occur. I have placed my investment of time and energy in the idea that the common sense use of the JOC will ultimately prevail, with or without the support of current management. I have an undying faith that the competitive structure of the JOC will accelerate the capacity within the industry to the point where the bureaucracy would otherwise not be capable of competing. The area the authors call E in Figure 2 is where I expect to see the JOC leading the industry.

While successful firms often used different terms to those above, all had developed similar methods to align collaboration efforts to their business strategy. Collaboration received visibility at a senior level, and was an integral part of the strategic-planning process. Increasingly, the focus was not on wage arbitrage, but on using partners to increase business value. these firms grew more sophisticated in the use of collaboration over time; by contrast, poor performers remained stubbornly focused on cost.

Organize for Collaboration

Innovation in oil and gas is a difficult prospect. As I mentioned earlier in this post, the earth sciences and engineering disciplines make the industry second only in complexity to the space industry. There is another element of the complexity that needs to be considered and that is uncertainty. The ability to say unequivocally that this is factual is difficult when your talking about forces several thousand feet below. The uncertainty element invokes the commercial environment on the producer. Then to make things even more difficult the innovation has to be progressive enough to push the science. And as I noted in the plurality writings, there is a strong influence of the science in innovation, which leads to greater understanding and a further development of the science.

The need for a different model can be seen by considering the challenge of partnering along two dimensions: The degree of uncertainty over the product to be produced; and the degree of uncertainty over the process to produce it (see Figure 3). Replicating an existing product (i.e., production) involves little uncertainty while developing a new one (i.e., innovation) is far more uncertain. Similarly, some processes are routine and easily specified whereas others are idiosyncratic and rely on trial and error learning. When firms face little uncertainty on both dimensions - the arena of production outsourcing - traditional models work well, given firms can specify what they want and how it should be made. As uncertainty increases however, a more collaborative approach is needed.

It is at this point that I would also assert that the production process, which is inevitable and in constant decline, adds further uncertainty above and beyond that of the firm. This is why $79 oil seems very cheap to me. The following quotation of the authors provides a good understanding of the work that is done at the Joint Operating Committee. This is how the industry has developed and how it functions. Unfortunately all of the software development projects fail to capture this organization and its role in the day to day operations. This is the business of the business, and due to a number of forces the business of the corporations has become the oil and gas regulatory compliance, tax compliance, SEC compliance and this is where the ERP focus has lead the organizations to focus and consume their time.

Leading firms viewed partners as an extension of their own development organizations, seeking their participation in meetings and including them in internal communication. As part of this philosophy, they required greater continuity in partner staff, in contrast to a transactional model, in which people move in and out of projects. This ensured the "tacit" knowledge of a projects' context was retained, and improved communication between teams. As one manager explained, "It takes time to appreciate the skills of each team member and understand how to work together. When people leave, we have to go through that learning curve again. So we put a premium on ensuring staff continuity".

This focus on the business is where the industry has to move to. Compliance and governance has to be as a result of conducting the business of the business. As simple as that sounds the administration of oil and gas has become completely divorced from the reality of the business. This is primarily the result of the software vendors focus on ensuring the technical accounting and compliance of the firm.

The authors now approach one of the difficult areas of collaboration. Intellectual property (IP) is the source of much value in today's economy. Who owns what and where did it come from are important considerations when the partnership as represented by the Joint Operating Committee is concerned. Traditionally the Chairman of the JOC used his firms resources to operate the programs that were agreed to by the partnership. With the prospective pooling of the technical resources as proposed here, the intellectual property can become problematic. The manner in which IP is managed in this industry is consistent with the keeping of trade secrets. I have noted here before that the stickiness of knowledge moving through the organization is contrasted to the leakiness of knowledge through the various industry related disciplines. If someone discovers something new, it is generally fairly well known on the street in a few weeks. Therefore no one has the right of that property, and most importantly copyright law is designed to disseminate ideas throughout the community as quickly as possible. There needs to be some soul searching as to how firms manage their alleged secrets and the result of their research.

The final area in which firms made different organizational choices was in intellectual property (IP) management. Global partners increasingly develop their own IP - new components, technologies and processes - to improve project performance. Furthermore, collaboration often requires that partners re-use and add to a firms existing IP in the search for new solutions. Given these trends, traditional approaches to IP which assume that a firm must develop, own, protect and isolate its IP are increasingly outdated.

and

While successful firms in our study differed on the specifics of their IP policies, their actions reflected a common shift in values; towards a more open and flexible approach. these firms sought to leverage partner IP, focusing on the cost and speed advantages, which outweighed the concerns about the need for control. They developed mechanisms for partners to access their own IP, in a way that facilitated collaboration but ensured the protection of competitive assets. And they shared newly developed IP when the firm and its partners could benefit form its application, as long as the uses were not competitive.

Build Collaborative Capabilities.

Collaborative skills are hard to come by without the efforts of many who are willing to contribute and learn. These are standard fare for the process of collaboration and I apply this throughout the industry. The smartest, most educated and most recent additions to the firm are needed to adopt these perspectives. Here the authors begin to identify some of the salient points involved in good collaborative practices.

The final area separating leading firms from others was their willingness to invest in developing "collaborative capabilities." All too often, firms assumed that their existing employees, processes and infrastructure were capable of meeting the challenge of collaboration. But successful collaboration doesn't just happen - it is a skill that must be learned. Rarely do firms get it "right first time." Leading firms recognized this reality and made investments to enhance their performance over time.

and

Successful firms targeted investments in four areas: people, process, platforms and programs. We call these the "Four Pillars" of collaborative capability (see Figure 4). These investments were typically funded outside the budgets of individual projects, given few projects can justify the levels of infrastructure needed to perform well on their own. In essence, leading firms made a strategic decision to invest in collaborative capabilities, and sought to leverage these investments across projects and over time.

Developing People

My first truly collaborative environment came about in 2000 when I started my on-line MBA. The university had over 1,500 students located throughout the world and closely tied together in a Lotus Notes collaborative environment. It was fascinating to learn so many things about businesses that were in Kuwait, China and even your own province. My perspective changed over the course of three years of study. And I learned to adopt a broader point of view about the contributions that I made. Asking key questions after attempting to learn the unique perspectives of the participants and then attempt to build on the quality and quantity of knowledge held within the diverse groups, were skills that are not easy to come by. The intensity of the learning was heightened as a result of the close collaborations.

Superior performance in collaboration requires people with different skills, given team members often lie outside the boundaries of the firm, are located in far flung countries and have vastly different cultures, The "art" of management in such projects is in finding ways to exert influence over resources not under a firms control. Rather than a focus on deep technical expertise, managers therefore require a much broader skill set, associated with the need to orchestrate and coordinate the work of distributed teams.

I have not been able to specify the manner in which the process of this software development will proceed. Collaboration is a key component, as will software that defines the process and the roles of individuals and companies. The way that the Java Community Process is done is a given as far as I am concerned, however, there are other elements of how things get built that I have to research and determine before we start writing code.

Most projects we observed employed a formal product development methodology based upon a modified "stage-gate" or "waterfall" type process. These processes are increasingly popular ways to ensure greater control and consistency in the execution of projects. But these techniques, and others that share their roots, are often predicated on the assumption of single-site development. There is a need to re-think how they should operate when managing the distribution of work among a team of global partners.

Building platforms

The following in my opinion is a call to action for these types of activities to be conducted, coordinated and implemented on an industry wide basis. Decisions are being made without the input of others to ensure a timely start to these developments. Selecting the Google Apps as the platform to begin the collaboration and develop is a rather obvious choice, particularly when you consider where Google's engineering and innovation may take the product too.

Leading firms developed technology "platforms" to improve the coordination of work. These platforms comprised four main parts: First, development tools and technologies to improve the efficiency of distributed work; second, technical standards and interfaces to ensure the seamless integration of partner outputs; third, rules to govern the sharing of intellectual property among partners; and fourth, knowledge management systems to capture the firms experience on how distributed work is best performed. This collaboration "infrastructure" was leveraged across multiple projects over time. The goal was to promote a long-term view of the assets needed for effective collaboration.

For the risks and errors can be and are very large.

Consider the troubles at Airbus in developing its flagship A380 aircraft. Airbus' German and French partners chose to work with different versions of the Dassualt Systems' Catia design software. But design information in the older systems was not translated accurately into the new new one, which held the "master" version. With a physical mock-up, these problems remained hidden throughout the project. The result: 300 miles of wiring, 100,000 wires and 40,000 connectors that did not fit, leading to a 2 year production delay at a cost of $6bn. Yet the cause of Airbus's problems was not in choosing different versions; rather it lay in the lack of an effective process for dealing with the problems this created.

Managing Programs.

The energy industry has a choice. They can begin serious efforts down this road with the objective of building systems to enhance innovativeness and performance, or continue on in the manner that they currently are. At some point in time someone will realize the intellectual property that I have developed here in this blog is the constructive direction of the industry. If not then we would have the ability to modify it to make that assertion valid.

Successful firms managed their collaboration efforts as a coherent "program," in contrast to organizations which ran each project on a stand-alone basis. A program view was critical given collaboration projects rarely met expectations early on, and performance often deteriorated when the scope of efforts was increased. Leading firms did not differ from others in this respect; but they did differ in the rate at which they improved. Top performers put in place mechanisms to help improve their collaboration skills over time.

A New Source of Competitive Advantage

Firms that devoted attention to the three areas above - strategy, organization and capability development - were more successful in their collaboration efforts. For a few firms in our study however, these efforts not only lent support to their existing business strategies, but also led to new value creation opportunities. Their investments to build capabilities, in turn, created options to pursue strategies that could not be replicated by competitors; especially those that managed collaboration like outsourcing. For these firms, collaboration had become a source of competitive advantage (see Figure5).

In our view, Boeing's source of competitive advantage is shifting; it is less and less related to the possession of deep individual technical skills in hundreds of diverse disciplines. While the firm still possesses such knowledge, this is no longer what differentiates it from competitors such as Airbus, who can access similar capabilities. Rather, Boeing's unique assets and skills are increasingly tied to the way the firm orchestrates, manages and coordinates its network of hundreds of global partners. Boeing's experience is increasingly common across the industries we observed: Collaboration is becoming a new and important source of competitive advantage.

Technorati Tags: Genesys, Call-to-Action, Collaboration, Harvard, Organization

Photos Courtesy the authors.

A researchers delight.

Google recently upgraded their "Google Books" search and information system. In the past I was able to use an application called "Books" to manage the library of books that I have. How many times I had wished for the ability to search just my books, and only my books. This was a dream that I believed would never be realized, then came Google. Their new product offering does just that, it lets you search the books you loaded into their new "Library" feature of Google Books. Giving you an index of just your books is something that should be in every users tool box.

An added feature of Google Books should be the capability to purchase Books, and maybe just electronic access for a short period of time. Or maybe an overall subscription that provides access to all books. Nonetheless a researchers delight to be sure.

Technorati Tags: Genesys, Google, Interests, Search

Google and CapGemini in agreement.

As I have indicated here before, "Google Apps for your Domain" is the collaborative environment chosen for www.people-ideas-objects.com. Today Google and CapGemini, Ernst and Young's technology division, announced that CapGemini would be supporting users for the use and integration of Google Apps.

CapGemini will be a resource that will be available to help the users of People Ideas and Objects collaborative environment. I look forward to using CapGemini's services in this area.

The warning that CapGemini notes in the announcement, about these collaborative environments being used within a company in an unauthorized manner, is similar to the warning I issued 42 months ago. That port 80 was able to allow these types of applications through the firewall was as big a danger then, as it is now. I can also assure you that when a major accounting firm is announcing the risk, it's too late to do anything about it. And I can certainly provide you with a domain name that is already being used in this manner for oil and gas. ;-)

Technorati Tags: Genesys, Alternative, Governance, Software

Another perspective

The keynote address at the 2007 Influence Conference was presented by ICANN CEO Paul Twomey. ICANN (Internet Corporation for Assigned Names and Numbers) is defined on their website as;

ICANN is responsible for the global coordination of the Internet's system of unique identifiers. These include domain names (like .org, .museum and country codes like .UK), as well as the addresses used in a variety of Internet protocols. Computers use these identifiers to reach each other over the Internet. Careful management of these resources is vital to the Internet's operation, so ICANN's global stake-holders meet regularly to develop policies that ensure the Internet's ongoing security and stability.

ICANN's role is interesting due its focus of being the naming conventions and their assignment. More or less a quasi street light architect / traffic cop. A rather limited role, however, as noted in his keynote; he sought out to provide a number of answers to some important questions regarding the future of the Internet.

Here is a comprehensive summary of Twomey's comments during his keynote.

"While it’s difficult to be definitive about the future, here are some things I think we can expect:"

• Usage of the Internet will be limited only by access to electricity. As many as 3 billion people may be able to enjoy a truly global Internet.
• Many, perhaps most, will access the Internet by using mobile devices.
• We’ll see a very significant increase in broadband access (over 100 mb/sec indeed up to 1 gigabit per second). Many developing countries such as Morocco, China and Malaysia are adopting accelerated broadband distribution programs to deliver the Internet to their citizens.
• A machine-to-machine Internet will overtake today’s person-to-person Internet.
• We will see billions of Internet-enabled appliances at home, at work, in the car, and in the pocket.
• Third parties will use the Internet to monitor all sorts of activities and utilities — from washing machines to cars to electricity meters.
• Geo-location and geo-indexed systems will be much more common and emergency services will be more precisely dispatched.
• There will be significant improvement in spoken interaction with Internet-based systems.
• We will see an even wider array of delivery methods for intellectual property (movies, sound tracks, books, and so on) than is available today. VoIP will be prevalent and SIP may be the principal protocol means by which calls are set up. Voice communication will be essentially free, except perhaps for calls that terminate on traditional PSTN devices including mobiles.
• Almost no industry will be offline since most will rely on the Internet for customer interaction, customer discovery, sales, service, advertising, and similar activities.
• Group interaction and collaborative support tools — including distributed games — will be very common.
• And last but certainly not least, internationalized domain names and new gTLDs will open up the Internet to much more multilingual content.

"What will you be able to do in the future that you can’t do now? Here are a few examples:"

• Manage your appliances and home security systems through online systems.
• Use your mobile phones as remote controllers.
• Download videos, music, and books as an everyday practice. Video on demand will focus on watching previously downloaded video rather than watching streaming, real-time video. This is really just an obvious extrapolation of the iPod/TiVo paradigm.
• You will be able to talk to the Internet itself to search for information and interact with various devices — and it will respond.
• Search systems will be more precise because meta-tagging of information will have become more common. This is part of the semantic web movement.
• Maintenance histories of products that can be serviced will be keyed to radio frequency IDs or bar codes associated with the devices. This is one potential use of Internet Protocol version 6, or IPv6, which is the natural extension of the original IPv4.

"What will the technical underpinnings of the Internet look like by then?"

• Terabit per second local networking will be available as backbones for local networks.
• The domain name system will operate in multiple language scripts. Again, a result of deploying IDNs and new gTLDs.
• IPv6 will be widely deployed, once the technical and financial issues have been worked out.
• Better confidentiality and authenticity will be provided through the use of a public key crypto. This will provide more authentication all along the network.
• Much more inter-device interaction will be common, incorporating position location, sensor networks, and local radio communications.
• Spam, phishing, and various forms of denial of service attacks will continue a cold war-style arms race with defenses and better authentication techniques.
• Operating systems will continue to be troublesome sources of vulnerability.

There should be no confusion: broadband speeds required to participate in the internet in 10 years time will be measured in the 100s of megabits per second. Indeed network planners in South Korea are now moving households to 1 gigabit connections today.

Why is the appropriate approach to broadband so important? It is because the Internet will continue to represent a massive and accelerating force for the reduction of transaction costs across the global economy, and a force for unprecedented innovation in the delivery of private and public services.

Clearly we see many of these same opportunities for companies and people. The last point I have highlighted in italics is clear recognition that the direction that this blog and software development proposal are consistent with others perspective and vision. Transaction costs are best handled in markets. Markets, due to their (primarily) contractual nature, increase transaction costs. Information Technologies reduce transaction cost friction to their lowest level. People, Ideas and Objects will bring these technologies to the energy industry.

Technorati Tags: Genesys, Ideas, Vision

And so it begins.

Today Total Petroleum announced a decline of 20% of their projected production to 2010. Not their overall production is in decline; only there projected increases are revised downwards from 5% to 4%. This is more telling about the politics in big companies. Rarely would we have seen such a statement that production would be lower then previously reported. If its lower then just do more drilling, or whatever, to increase production to what was reported earlier. For Total to issue such a statement there must be a lack of faith in the company’s ability to increase production that extra 1%.

Now that the IEA and the National Petroleum Council have released their reports it's "OK" for the truth to be told. Total may be the first that I am aware of, but I am certain that there will be many more, and the volume and the pitch will be heard everywhere. Just as in the 1980's when the managers jumped over each other to prove they could cut their budget further then the last guy, the companies will quietly line up and announce one after another the increase in their associated production decreases.

Speaking of cover stories, OPEC can now pipe in and say that they will be experiencing some production declines. With the news of the major producers decline in production becoming yesterday's news, and a financial crisis in the home mortgage market, no one will actually hear OPEC announce the declines. (Possibly as soon as September 11.) And it will be too tempting for them not to make these announcements. After all reporting to their people that production is scaled back and revenues are way up will be easy to sell. Hugo Chaves may actually become that mythic hero he sees himself as.

I have repeated here many times that the constraints on companies are the reason for the associated decline in production. It’s a new time and a new place. We have to do something to affect the performance of these companies. Our choices are the status quo, build the software I speak of here, or if we do not define and support the Joint Operating Committee, as is suggested in this new software development, then we will be relegated to reorganizing to manual systems.

Clearly the status quo is not working. Join me in making this re-organization real. When you have the organizations actively jumping over each other to state the bad news, you know that their options are limited.

Technorati Tags: Genesys, Software, Capabilities, Environment, Interests

Steve Jobs and his Apple iPod.

Today was a great day for the Apple faithful with a high profile presentation of the new iPods by Steve Jobs. I want to reiterate the risks of these WiFi enabled hard and ram disk devices in the corporate environment. Pod Slurping is the ability to access and copy corporate information for unauthorized purposes. Now with WiFi the risk rises. A relatively remote risk if you have a secure network, but with all things network, the number of ports and the number of methods is limited by human imagination. These devices, along with the SunSpots and Motes that I recently wrote about, will be perceived by some people as being either curses or highly effective tools. Since I am a glass half full type of thinker, I'll just mention how I use iPods today and what potential they have in the hands of the oil and gas industry that is supported by a capable software development vendor.

I currently have two iPods that I use constantly. I have used iPods for over four years and find them to be an indispensable tool in this day and age. Firstly I use an iPod Shuffle, the clip on 1GB model that I fill with PodCasts. The iTunes Music Store has many quality podcasts that I subscribe too. Unfortunately I listen to up to 2 - 3 hours of casts each day. The Shuffle allows me to control when and where I can listen to them. I clip it to my lanyard and have the earphones handy. A simple click of the play button and I'm right where I left off. With over 15 hours per charge, I have many PodCasts that I want to concentrate on when I am commuting, waiting, or just out and about. I like to think of this time as an increase in my productivity as I can generally listen and do something mindless at the same time.

What I have loaded on my Shuffle right now is Bloomburg on the Economy, EconTalk, Google Developer Podcast, The McLaughin Group, Meet the Press, 4 courses of lectures from UC Berkeley (2 economics, 2 information technology), Stanford which includes the Hoover Institute, MIT, Dr. Moira Gunn Tech Nation, NewsHour with Jim Lehrer etc. Jobs stated that there are now 125,000 podcasts, 25,000 video podcasts, so there should be something for everyone. I frequently felt frustrated that I was not keeping up on this valuable content. Now I can synch as frequently as I like and have the most up to date information available to choose from during the day, all thanks to the Shuffle.

I also have had a classic iPod for over 4 years and find them an indispensable and valuable tool for travel and the like. I also back up all of my data to them, frequently, creating a corporate risk if you lose the device. With the ability to watch movies, television, YouTube or Google videos they can provide an asynchronous portal to the entertainment / information you enjoy or need.

What will the iPod provide in the near future? I think we have seen enough of these devices development to know that the iPhone will become standard fare for the productive worker. Email may seem like a small increase in capability, however, email with rich media is a completely different tool. People are frequently working with more complex ideas and concepts. Text is the clearest and easiest to produce, but many important concepts can be articulated more clearly in rich media. Speeches, presentations and corporate summaries will be the types of media that can and will be produced. For anyone in the audience of a company that needs to know, the presentation could become central to the quality of its communications. Just as I think blogs will soon replace resumes, companies will need to revisit the definition of their audience and the communications to the people they need to communicate with.

The Technical Vision that I have presented for this software development project, noted that the volume of data will grow exponentially. I have also noted the need to be tied down into an office is becoming more redundant each day, with possibly energy, or rather the saving of it, may be the killer app for ubiquitous computing, Demanding that people be available anywhere and at anytime they are required. iPhone will be your portal to the control of the demands of daily living and completion of your work.

Or maybe transaction processing will be the killer application that brings these devices into the corporate world. That is where I am putting my time, money and energy. In bringing this software development to the 21st century oil and gas user and producer.

Technorati Tags: Genesys, Apple, Software, People

Leading and Creating Collaboration in Decentralized Organizations

Heather M. Caruso
Todd Rogers
Max Bazerman

Click on the title of this entry to download the .pdf. This Harvard Business School Working Paper provides some insight into the group dynamics of collaboration. I find many of the comments and recommendations are very consistent with my own experiences. These are skills that are necessary in today's marketplace, and I think that the level of collaboration is just beginning to evolve and will become much more complex in the very near future. The authors start out with a chilling example of collaborations failure and looks into the types of group and individual failures.

In reviewing the Web Services paradigm I sourced a document from John Seely Brown and John Hagel with can be read here. In that article it was discussed how the division of labor caused the dynamic of information leaking out of organizations faster then the information is transfered within the organization.

In Brown & Duguid (1998) they make the following observations: “The leakiness of knowledge out of and into organizations, however, presents an interesting contrast to internal stickiness. Knowledge often travels more easily between organizations than it does within them. For while the division of labor erects boundaries within firms, it also produces extended communities that lie across the external boundaries of the firms. Moving knowledge among groups with similar practices and overlapping membership can thus sometimes be relatively easy compared to the difficulty in moving it among heterogeneous groups within the firm. Similar practice in a common field can allow ideas to flow. Indeed, it’s often harder to stop ideas spreading then to spread them.” (p. 102)

We see this phenomenon in oil and gas where news travels very quickly through the industry. If it were an accounting issue it would be openly discussed with the audit firm, the professional associations and within the industry specific organizations such as the Petroleum Accountants Society. Discussions between CFO's of the various producers is very common and many of these conversations are beyond the scope of many of the other C class executives technical understanding.

The authors note a current example of this "stickiness" and start out with a chilling example of collaborations failure and then look into the types of group and individual failures.

Many employees note that, in decentralized organizations, it is harder to deal with other divisions or departments of their organization than it is to negotiate with outside suppliers or customers. In ordinary cases, this inter-organizational coordination failure which can cost substantial sums of money. In other cases, these failures can be catastrophic, as different agencies within the U.S. intelligence community (notably, the CIA and FBI) neglected to integrate knowledge of the looming threats that existed prior to September 11th, 2001. p. 2

and

Often, instances of coordination failure stem from the failure to appropriately structure the organization around the key inter-dependencies within the organization - whether that suggests organizing by function (e.g., sales, marketing, manufacturing, engineering, etc.), by product group, or by region. Yet, even when organizations are able to design divisions around the appropriate dimensions, there will always be a need to integrate information across the resulting units. We focus this paper on improving information coordination across these organizational units to maximize organizational effectiveness. p. 2

"The Need for Coordination Across Organizational Boundaries."

It is at this point that I believe the energy industry breaks from convention. The Joint Operating Committee (JOC) is the legal, financial, cultural and operational decision-making framework of the industry. The software that is used summarily ignores these facts. SAP, Oracle and others do not fully recognize these facts within their domain of functionality and processing. Theirs are focused more on the classic modular breakdown of General Ledger, Accounts Payable and Accounts Recievable with the occassional Land and Production modules designed to handle the company's interest.

As organizations grow to serve multiple product areas, regions, or demographic groups, they move toward decentralized structure, which enable them to structure the organization around organizational units that match the most important organizational dimension. This system makes it unnecessary for each unit to constantly involve the rest of the company in their local affairs, relying instead on each unit to coordinate their actions with others only when necessary, and to otherwise focus their relatively undivided energies on the niche for which they have been made experts. As a result, these decentralized units demand less monitoring from busy top management teams, expand the organizations capacity to explore and adapt to its environment, and create space for innovative, entrepreneurial problem solving. In addition, it is easier to motivate performance in a decentralized organization than in a tightly controlled centralized structure.

And possibly the authors are speaking proactively. In that the future dynamics of the organization will move closer toward a market configuration as opposed to the strucutured hiearchy. It would certainly appear in this next quotation that is the mindset of the authors.

Nevertheless the world is getting smaller. The various pockets of human society are becoming more dynamic and diverse because they are coming closer together, connected by an increasingly dense web of physical and technological expressways. With these connections, synchronized patterns and coordinated activities are likely to emerge across multiple locales, though they may be exceedingly complex, often anticipate, identify and respond to patterns of activity across the diverse niches their subdivision serve. p. 3

Which is all well and good but as we all have experienced in life, there are consequences of these things. And this is where collaboration can really cause disruption in the day to day functioning of inter-organizational communications. How can each and every producer within a JOC deal with the group dynamics of the property. I would suggest that ignoring the JOC for the majority of the time has been the bureaucracies and software vendors' means of dealing with these group dynamics. The problem with this position is that the tools necessary to have a more direct involvement are influencing the industry and the performance metrics of the JOC may (will?) provide real competitive advantages to those producers that embrace this new dynamic.

Unfortunately, the rapid and novel changes that create the demand for decentralization in the first place often place organization leaders in a considerably less certain, and consequently less commanding, position. p. 3

And here must be classified as another call to action;

Leaders cannot afford to possibly wait for these unstructured collaborations to emerge on their own. Boundaries and bad habits make organization members unlikely to instinctively reach across divisional lines to integrate their knowledge and activities appropriately. p. 4

"Barriers to Information Sharing across Organization Boundaries"

"Intergroup Bias"

There may be over 100,000 JOC's in the global oil and gas industry. Each one is distinct and has elements that make each one mutually exclusive to the others. Different partners, wells, facilities and location are just some of the attributes that make them unique. The authors suggest that this may impede collaboration between the companies associated with a JOC.

One key barrier to cross-boundary information sharing stems from one of the very reasons organizations establish group boundaries to begin with: to create and maintain a recognizable and meaningful distinction between two or more groups in the organization. p. 5

With the assocated size of many JOC's it is possible to have hundreds and possible several thousand people employed exclusively in one JOC. Therefore for each company to dedicate staff to that one area would not lead to too much difficulty. However, the firm has needs that are associated with that JOC that are above and beyond those individuals focus. Much as I have written about the possible difficulties experienced by Chrysler. Where the firm may lose some of its overall technical capability by the focus being exclusively on the JOC and the market that supports it. The firm needs to conduct elements of science and technology capabiliities which in addition to its land base are its key competitive advantages. Here the authors indirectly note the problem that I think is highly related to the Chrysler situation that I wrote about here.

In a decentralized organization, the salience of differing groups memberships and this self serving motivation set the stage for integroup bias - the systematic tendency to unfairly treat one's own group or its members better than a non-membership group or its members. p. 5

and

Competitive pressures on the different groups in a decentralized organization could easily provoke similar forms of intergroup antagonism and diminish or destroy any hope of unstructured, emergent collaboration. Company funding, access to markets, intellectual property rights, and numerous other organizational assets are all potentially scarce resources over which groups with the organization may have to (or feel they have to) compete. p. 6

and

This suggests that the fog created by legitimate competition between organizational groups can prevent group members from recognizing or taking advantage of unrelated opportunities to share mutually beneficial information and collaborate. If derogation of the out-group extends to derogation of the information it possesses, members of one group might foolishly reflect useful information from another group. Alternatively, perceived competition might create an exaggerated fear of sabotage form the other group, predisposing group members to hoard or withhold information form other groups that might leave them vulnerable. p. 6

These quotations add more focus to the problems that may be experienced by establishing the boundaries of the firms in this proposed software development. On the surface it may appear that the need to abort the idea of developing this software would be an ideal position. I would argue that noting could be further from the truth. It is the time and place that we find ourselves operating in that challenge us to work in a more decentralized manner. The technologies, the competitive pressures, the risks and the rewards would lead or motivate individuals to operate at this higher level. The risks are clearly articulated by the authors in this next quotation.

The now-famous intelligence failures surrounding September 11 reveal a situation in which the sometimes conflicting goals of the CIA (intelligence gathering) and FBI (Criminal Prosecution) have created the perception of inter-agency competition for information, time, and access to key informants or suspects. p. 7

One remedy that I could suggest may be effective would be for each company that has a working interest in a JOC would be entitled to the data and information that is available to the active members of the JOC. The ability to share information between the groups electronically is something that can be managed in an appropriate manner when the industry has the capability of a dedicated software developer as proposed here. Lastly the authors note that this intergroup bias may be a simple feature of the assignment of people to groups. What the technology proposal inherent in this blogs writings is attempting. Is to enhance the cross functional collaboration between the various disciplines involved in oil and gas. Hence this proposal provides the opportunity of eliminating one element of the intergroup bias.

Competition is certainly a powerful driver of intergroup bias, but it is not actually a necessary precondition for the emergence of bias. Remarkably, intergroup bias will arise with little more than the mere assignment of people into distinct groups. p. 7

"Group Territoriality"

Group dynamics have a potentially negative effect on the dynamics of establishing the market as the basis of the JOC definition. If these group dynamics are not clearly defined and dealt with the effectiveness of the market and the firm will be at risk. The intergroup bias has a strong tacit concurrence to the definition described, as does Group Territoriality defined by the authors as.

Organizational boundaries do not only serve to distinguish groups from one another, but also to help groups define themselves in a more absolute sense. Unfortunately, just as the former effect poses a threat to cross-boundary coordination through intergroup bias, the latter effect can have negative implications as well. p. 9

and

Once these items are identified as part of a groups territory, we suggest that they afford group members a sense of psychological ownership - claims to, or feelings of possessiveness and attachment toward, those objects. p. 9

When we add the elements of the cognitive and motivational paradoxes to these group dynamics, I think we can see some of the reasons why group territoriality comes into play. There is a sense of urgency involved in many of the operations of oil and gas that can further affect group dynamics. Therefore I think that this should be an area of intense study during this development. Not to add further fuel to the fire, but there is a large disparity in many of the peoples acceptance and use of technology. Not everyone will have the same capacities to deal with the technologies and see the opportunities that others see.

We classify these behaviours as instances of group territoriality action undertaken by a group or by individuals on behalf of their group which are designed to reflect, communicate, preserve, or restore the group's psychological ownership of its territory. Unlike intergroup bias, this preferential attention to the intergroup does not stem from the desire to improve the standing of one's group relative to others. Instead, this behaviour is more inward-looking; it stems from the need to respect and reaffirm the identity, efficacy, and security of the group with the organization. Nevertheless, group territoriality can constitute a significant barrier to emergent intergroup collaboration and information exchange. p. 10

and

Through marking and defining behaviors, group territoriality can often work against information exchange in decentralized organizations. These behaviours exaggerate each organizational unit's focus on itself, facilitating possessiveness and disregard for other units. p. 13

and

The second group need that undergirds group territoriality is the need to establish and maintain a sense of group efficacy in organizational relevant domains. This form of efficacy refers to a groups belief in its collective ability to organize and perform the activities necessary to achieve desired goals, At the broadest level, identification and protection of group territory helps groups to identify the goals they should aspire to achieve. Moreover, when a group's territory is widely recognized by others, such recognition can serve as an implicit endorsement of the group's efficacy in related domains. Control over group territory further enhances a sense of group efficacy by assuring groups of ready access to resources that can facilitate their accomplishments. p. 14

Finally a positive attribute of the times that we find ourselves in is the long term shortage of people in oil and gas. This is providing a level of job security that I have not experienced in the 30 years that I have worked in oil and gas. The authors point out that a secure environment is a precursor to dealing with issues.

When a group feels secure in its environment, it can more easily develop expectations of and predictions about its environment, which can facilitate the planning and execution of activities. p. 14

"Poor Negotiations Across the Organization"

This next topic would be something that is totally new to me. I will leave it to the authors to define the issue and their solution and then I will comment at the end.

The final barrier to effective cross-boundary information sharing we discuss involves the poor strategies used by members of different organizational divisions when they negotiate with one another. p. 15

and

Nevertheless, both parties commonly focus only on the claiming aspect, and destroy value for themselves and for the broader corporation. These failures are due to both faulty cognitive assumptions and to the failure to follow insightful prescriptions about how to negotiate more effectively. Perhaps the three most important cognitive errors are the myth of a "fixed pie" in negotiations, the failure to carefully consider the decision processes of one's negotiation partner, and the failure to recognize opportunities to negotiate in the first place. As parties enter into a negotiation, they too often assume that their task is to divide up a fixed pie of resources. Researchers have described this tendency to view competitive situation as purely win-lose as the mythical-fixed-pie mindset. p. 15

and

Related to the myth of a fixed pie is the cognitive failure to fully consider the perspective and decision processes of the other party. Though many people recognize the importance of "putting yourself in the shoes of others", ample research shows that most of us fail to do so. The price we pay for this failure is weaker negotiation outcomes. The key to creating value in negotiations is to identify areas where mutually beneficial trades are possible. p. 16

and

A last cognitive barrier to effective value creation in cross - divisional negotiations is that the parties fail to recognize that they are involved in a negotiation, thus missing the accompanying opportunity for value creation. pp. 16 - 17

This last point being the key from an administrative point of view. My perspective of being in accounting, audit, and systems has been skewed by wanting to provide the best services to the operational areas. I would suggest that many of the earth scientists and engineers can better appreciate the point of view of the authors.

"Leading Emergent Collaboration"

The challenges to effective emergent collaboration have a number of implications for effective leadership in decentralized organizations. Accordingly, we focus this next section on three key recommendations leaders may explore in order to overcome the threats of intergroup bias, group territoriality, and poor negotiation norms. p. 17

"Link Group Interest to Super-ordinate Interests."

They attacked competition as the root cause of the bias, and simply presented the groups with tasks that each group could only achieve through cooperation with the other. Faced with necessary cooperation, the groups began to exchange help, information and resources, they willingly shared the spoils of their achievements. While this demonstrates the power of the super-ordinate cooperative goals to facilitate cooperative behaviour, the result depended on the replacement of divergent group goals with the common goal. p. 18

Just as actual competition is not necessary to promote intergroup bias, more recent research suggests that actual cooperative goals are not necessary to resolve it. p. 18

In decentralized organizations, however, it can be important to retain and even emphasize the salience of distinct group goals and identities, so as to facilitate the efficient discovery of related resources and expertise. Focusing group members exclusively on a superordinate organizational identity may also distract members from thinking and acting in ways that are consistent with their group membership, diminishing their ability to provide the localized focus, perspective, and actions on which a decentralized organizational structure depends. pp. 18 - 19

It should be made clear that no one group can achieve the superordinate goals, nor can one group give the organization sufficient richness and depth. Group members can thus be encouraged to see themselves as fundamental linked to out group members while remaining cognizant of the fact that the link itself depends on their ability to contribute localized expertise to the others. p. 19

"Frame Collaboration as the Solution to Group Needs."

The underlying drivers of group territoriality are the groups needs for a sense of identity, efficacy, and security. the natural impulse for groups and their members is to satisfy these needs by becoming inwardly focused, by utilizing group territory to meet these needs, and by engaging in territorial behaviours to protect their ongoing ability to continue utilizing the territory for those purposes. p. 19

The key underlying issues here is that groups often seek to satisfy their needs by turning their attention exclusively to their own members and territory. They ignore or fail to recognize opportunities to satisfy their needs through, rather than in spite of, interference from other groups. p. 20

Raising the profile of eagerness to collaborate as a dimension of identity can thereby create a self-sustaining meaning and salience in the organizational environment, as it encourages groups to refer to each other not only in terms of their territory proper, but also in terms of their approach to sharing and exploring territory. p. 20

With the increasing popularity of cross-functional teams, it seems like it should be especially easy to sell collaboration to organizational group members as a way of developing new competencies and enhancing their sense of efficacy. However, because people are often drawn into collaboration across functional or disciplinary lines, group members may instead feel that they have been chosen to primarily "represent" and advocate for their group's ideas and approaches in the interaction. pp. 20 - 21

By thus highlighting the prospect of substantial losses, leaders can capitalize on the groups need for survival and increase the willingness of groups and their members to accept the security risks posed by information exchange and collaboration. p. 21

"Enable and Encourage Effective Negotiation Behaviours"

The second aspect of getting organization members to negotiate effectively across the divisional boundaries is to establish strong explicit norms (especially during times of change or transition) that support information gathering, disclosure, and constructive criticism. p. 22

This underscores the critical point in maximizing organizational value-creation during cross-divisional negotiations: optimal outcomes demand that a leader instill, and reinforce, norms that promote information sharing and discourage information hoarding. pp. 22 - 23

Some might argue that a norm of information sharing and collaboration would destroy "constructive conflict" within an organization. We do not agree. We think that it is fine for divisions to compete along many fronts, including value claiming once the total value of the pie has been maximized. But, such competition should not destroy value. Just as organizations have norms against lying, deception, fraud, and hiding defects in products, we argue that organizations could also have strong norms about optimal collaboration across units. p. 23

This last section of their document providing many of the solutions the authors have found to the group dynamics. I am unable to comment constructively on many of the points. I will however note that during my "online" studies for my MBA. I found it particularly difficult for most of the other students to offer or accept any constructive conflict in the discussions. The initial feeling is that conflict is something to be avoided and if anyone raises it they are not cooperating appropriately within the group. I tend to disagree primarily out of my type "A" personality, but also because I feel fundamentally that the contradictions and conflicts in life are the best means in which to identify and resolve issues. If the groups approach is to avoid conflict, then I feel that the groups approach is to get along and go through the exercise without any real debate. (Or argument.)

These last two blog entries have dealt with some of the personal issues that we will face in these developments. How best to proceed from this point, I think, is to establish this area with some real research that provides us with key understandings of the unique involvement here. With this research we should be able to identify many of the tools necessary to mitigate the problems and maximise the opportunities. Tools such as a comprehensive code of conduct that adopts these principles and research findings, and I am certain that most of the real issues remain undiscovered as we proceed down this road.

Technorati Tags: Genesys, Research, People, Productivity

The constraints of code and customers.

I have commented many times about how this project is a clean slate approach to systems development. This may simply be a diplomatic way of stating its obvious vapor-ware status. What I mean is that the software development business is unique in that constraints of code and customers eventually become impediments to instituting any change. This may be ideal for companies such as Microsoft but for an Enterprise Resource Planning (ERP) vendor, and particularly for the oil and gas industry, nothing could be further from the truth. The two constraints of code and customers are also related and affected by the motivational and cognitive paradoxes of the users of the system.

I consider these constraints of code and customers to be unacceptable to the best interests of the users of this system. The motivation has to be for the users to influence the development that they need and want. (Using software such as this enables the community.) If it is necessary to rewrite some code, or the users decide to archive an entire module, then it will be done. The primary focus of the developments should be accuracy and increasing the productivity of the users of the system. Productivity increases are not static. How can an industry continually increase the capability and functionality of their systems on a constant basis? This blog entry will show how I think these software development should be done.

Firstly let me try to explain what I mean by better defining these constraints.

• Code: With the progressively increasing size of installed computer code, the costs to the software developer to change and innovate become increasingly more difficult to justify.
• Customers: With progressively greater numbers of clients using the software developers code, the costs to upgrade the installed base of customer’s code and associated support revenue, do not support change and inhibit innovation.

My findings also show that the ability for producers to secure the necessary ERP systems, irrespective of the software development method used, is contingent on the active involvement of their money, time and people. These are the resources necessary to develop systems that specifically fit the producers' needs. Over the past 20 years we have seen how the speculative model of software development, either international or local in origin, has failed to provide the oil and gas industry with optimal systems. I attribute these failures to the inability of any of the software development projects to be influenced by the users. Without user involvement, no quality systems will be built. This blogs purpose is to start the conversation among users, get them involved, and ensure the developments are what are necessary to function in the exploration, exploitation and production areas of oil and gas.

Using the Web Services paradigm, users will access People, Ideas and Objects systems any time and anywhere. A producer's specific software installation is not part of the design specification, however, it may be an option that can be accommodated. The data and information integration costs will be borne by the individual producers and be offered as part of the users domain of business service offerings. The total costs of this development and its associated costs will be shared by the producers that use it. Bringing the costs of software development to a small percentage of what has been incurred in the past. A method of assessing these costs has not developed at this time, neither has the community of users or their business offerings formed as of yet. This being a classic chicken and egg proposition that I have to resolve.

In noting that there will be a variety of user based business offerings developed as a result of this software development. I am attempting to eliminate some of the associated user based impediments to active involvement and participation to the software's development. These impediments are known as the cognitive and motivational paradoxes. A brief introduction of these is as follows:

• The "motivational paradox" arises from the production bias. That is, users lack the time to learn new applications due to the overwhelming concern for throughput. Their work is hampered by this lack of learning, and consequently productivity suffers. Carroll and Rosson (1998)
  
• The "cognitive paradox" has its root in the assimilation bias. People tend to apply what they already know in coping with new situations, and can be bound by the irrelevant and misleading similarities between the old and new situations. This can prevent people from learning and applying new and more effective solutions. Carroll and Rosson (1998)

What is of concern here is the quality of the development may be directly related to the users and contingent on the level of training they receive and understanding of the process, capabilities etc. Adopting this clean slate approach to systems development will take them time to adapt. Therefore, payment for these services is a given. Asking people to sacrifice their free time will sustain the developments only for a short period of time. Would some users consider it a full time job? Yes, I think that is possible and may occur, or users will develop their own businesses offering integration, training and associated services for the software. This community will need to be self-sustaining and possibly involve hundreds or thousands of individual businesses.

As can be seen in this description the solution that I am proposing is not just the software development, which is the domain that I am concerned with, but all aspects of the user community and day to day administration of the oil and gas producers. An entire re-alignment of the industry based on the needs of the producers as specified in the module definition and the joint operating committees. However many independent business that are needed in order to undertake these tasks is defined by the needs of the producers. This community or "market" is part and parcel of the market definition of the boundaries of the firm. Contact me here if you would like to join me.

Technorati Tags: Genesys, User, Development, People

They're here...

Sun Microsystems Sunspots and Intel Motes.

To help in understanding the impact of the technologies that are to be introduced through this software development project, I have created a vision of why certain technologies will have a dramatic effect on the people operating in the energy industry. This vision encapsulates four key technologies, Objects, IPv6, Asynchronous Process Management and Wireless. I have written in detail about these technologies here, here, here and here. These four technologies enable a proliferation of devices to be connected to the Internet for data capture and remote control. What could be developed in these devices is limited to the imagination of the people that are involved in the oil and gas industry. A world with these types of devices needs to be approached differently in order to capture the volume of data, information and control that will be available.

It is this vision that is captured in Sun Microsystems "SunSpots" programmable, experimental gadgets to test and implement in new and innovative ways. From my point of view this is the beginning of the ability to develop new and interesting devices that will help increase people's and producers productivity.

We've created a platform that greatly simplifies development and experimentation with small wireless devices, and we've opened it up to the development community, said Roger Meike, research director for Project Sun SPOT. There will be tremendous opportunities to apply and expand this technology in all sorts of new and exciting ways.

Why would these SunSpots and Motes be used in oil and gas? Time, physics, pressure, location, and temperature just to name a few classifications of the many possible reasons. Soon these devices will be certified for RoHS (Restriction of Hazardous Substances) compliance. How many of these types of devices will be embedded in the operational day to day of an oil and gas producer? How many of these remote devices will be involved in the process of commerce, or more specifically the beginning, middle or end of a transaction? How will the limited human resources involved in the industry manage with this level of data and information? And who will be the first to employ these devices in a commercial setting, the producer, investor or user of the software development capability that I write about in this blog?

Technorati Tags: Genesys, Sun, Vision, Capabilities