IBM Happenings: May 2008

The month started out with the Business Partner Leadership Conference in Los Angeles and then was filled with a slew of announcements in hardware, software, services, acquisitions, and strategic alliances. The list of announcements made during the month is here. One of the most interesting things IBM did in May was to release a Global CEO Study. Being the largest information technology solutions provider in the world, it is imperative for IBM to have a keen understanding of the priorities of the top management of it's clients. The idea is to stay ahead of the curve and have the skills and resources in place to meet upcoming demand. IBM sent senior people to interview 1,130 CEO's from 40 countries to capture insights on how the challenges CEO's face today will impact the future of business.

It was the largest study of chief executives ever conducted -- spanning 32 industries. This was not SurveyMonkey -- it was face-to-face interviews. The study revealed that 83 percent of CEO's expect substantial change in the future, and are optimistic they can successfully manage change. The catch is that the CEO's report that their ability to effectively manage change is increasing at a far slower pace. The gap between the rate of change and the skills available is growing. This is bad news in some respects, but certainly good news for IBM which increasingly gains it's revenue and profits by filling skill gaps for clients.

A somewhat surprising insight from the study is that CEO's believe that the most important changes are occurring within their existing customer base. Two kinds of customers are emerging. First is the ‘information omnivore’ who craves knowing everything about everything and spends a good portion of their time (maybe most of their time) online. The other customer is the ‘socially-minded’ customer. This type of person can't get enough of providing and retrieving information about where they are, where their friends are, what they are doing, what their favorite things are, and arranging a rendezvous in both virtual and real world places. The CEO's plan substantial increases in investments to reach both of these customer types. This spells opportunity for IBM. Take a look at a video clip with more insight about the CEO Study.

Speaking of CEO's, two of the technology industry's finest got together on stage at the Business Partner Leadership Conference in Los Angeles. Eric Schmidt of Google and Sam Palmisano of IBM have more in common than you might think. Eric cut his teeth on IBM's largest scientific computers and has been a devotee of advanced computing architecture throughout his career. Sam has a conviction about the role of information omnivores and social computing. The common ground is cloud computing. The two companies announced an initiative to promote new software development methods which will help students and researchers address the challenges of Internet-scale applications in the future. The goal is to improve computer science students’ knowledge of highly parallel computing practices. IBM and Google are teaming up to provide hardware, software and services to augment university curricula and expand research horizons. The University of Washington was the first to join the initiative but the program is spreading to other leading schools around the world. The project combines IBM’s historic strengths in scientific, business and secure-transaction computing with Google’s complementary expertise in Web computing and massively scaled clusters. It seems very likely that the IBM-Google collaboration will change the way large-scale computing is exploited over the years ahead. Here is a video clip of what Eric Schmidt had to say at the Los Angeles meeting.

Complete index of IBM Happenings

Conferences , IBM , Internet Technology , People May 31, 2008 10:52 AM

Reflections

I began to write "reflections" in 1997. Some were about visits to an IBM customer, a university campus, or just to reflect on some issue of the day that struck me at the time. The Reflections were not an attempt to be profound.... just to share. Needless to say, this was a precursor to blogging. Some of the postings in patrickWeb are based on reflections but eventually they will all get edited and moved to the blog for posterity. Here is the list of Reflections from 1997 to 2002.

Blogging , Favorites May 28, 2008 03:01 PM

Worms and Potato Chips

Packaging is one of those things that most of us probably don't think about a lot. That set of plastic, glass, paper, Styrofoam, cardboard, and poly-whatever that contains and protects things we buy. I think of packaging in two categories -- that which something is stored in and that which something is shipped in. I am sure that packaging experts have a much more sophisticated way of describing it but that is my simple way of categorizing it. I suppose we mostly take packaging for granted but I am beginning to think it is actually a profound topic.

I began thinking about packaging as something discrete some years ago. Strictly in the "something is contained in it" category. What initially got my attention was a cereal box that I found great difficulty in opening without destroying it and its subsequent ability to keep the cereal fresh. I have since taken it as a personal challenge to be able to open a cereal box with no resulting damage. This is a non-trivial challenge - maybe an art. If it is a science then I haven't found the instructions anywhere. One starts by using a sharp knife with a long blade. You carefully slide the knife under the tab in the center of the top of the cereal box. Then you slice the material to one side while applying a slight upward pressure via the tab. Repeat for the other side. I give being able to do this without damaging the box top about 75% odds at best. You are now almost a third of the way through the task at hand. Now that you have freed up one of the flaps you have to free the other flap by tearing it from the side flaps. Completing this without damage is also about 75% odds if you are quite careful. You are now two thirds of the way to the cereal. Last comes opening the bag inside the box which actually contains the cereal. This is often the hardest part. If you grasp the two sides of the bag and pull very very carefully you have about a 50% chance of opening the bag without tearing it. After opening the main part of the bag you need to open the corners of the bag so the cereal can flow smoothly into your cereal bowl. Putting the collective probabilities together gives you a 50-50 chance at best of having an open cereal box that pours the contents smoothly and can be closed to protect freshness. Some packaging!

I could go on about jars that require a hammer to open, pill bottles that can only be opened by children, fresh fruit containers that have to be squeezed until they break to open, etc. etc. etc. I suspect those who suffer from arthritis of the fingers could make my examples seem trivial.

I received an Open It for Christmas last year tat is used to open things that come packaged in blisters, clamshells, boxes, DVD cases, and numerous other things that are un-openable -- packaged with the vendor in mind -- and with no thought about how the consumer might open the package without injuring oneself. The Open It is made from hardened and plated precision alloy steel, has honed, angled, and offset jaws, and an ergo-comfortable handle. It has a built in retractable utility knife and an interchangeable Phillips & slotted screwdriver. (You can click here to get a complete product data sheet). If you have ever suffered "wrap rage", suffer no more. It really works. The only catch is that the Open It comes in one of those packages that you need an Open It to open it!

But there is a much bigger packaging issue becoming part of our lives. The issue initially struck me when I had received my very first order from net.grocer. I had ordered an assortment of salsa, condiments, and potato chips. An Australian newspaper wrote a front page story (business section) about how an Internet "visionary" had ordered potato chips on the Internet. The amazing part to me was not that the potato chips arrived unbroken but rather the packaging. I feel like I want to signal the future importance of "packaging" in the way the gentleman in "The Graduate" signaled the importance of "plastics" to Dustin Hoffman.

I opened the two large cardboard boxes and unpacked all the items. Everything exactly as ordered. I was quite pleased and proud of my e-commerce prowess (e-business hadn't been invented yet) in walking the talk and acquiring all of my favorite goodies (especially potato chips) online. I was reveling in my predictions about how everybody would buy everything on the Net. Then I got a lump in my stomach. I looked at these two large cardboard boxes on my kitchen floor. And, the piles of poly-whatever "worms" (many people call them "peanuts"; I call them "worms") that were all over the place. Some stuck to my hands, arms, and clothing. What was I to do? My wife would be home soon and have a lot of questions about my plans to clean up the mess I had created in the kitchen. All the glory I felt about acquiring Tabasco and potato chips would be nothing compared to the wrath she would unleash about the mess if I didn't get busy. No problem. I'll just clean it up. All I have to do is separate all the various packaging materials into their respective categories, burst the cardboard boxes, put the "worms" into a bag so they don't end up decorating our lawn, and then stow everything away in our recycling center. Shouldn't take me more than a half hour. Let's see -- how much time did I save with my Net Grocer purchase anyway? Surely I am still way ahead?

Then there is the purchase of something really simple -- say a cell phone battery. What is the ratio, on a volume basis, of the packaging material to the battery? 2 to 1? 5 to 1? 10 to 1? 100 to 1?And then there are the "worms".

So, what is the answer to all this? First of all, shopping on the Net is here to stay and should be. Retail online now exceeds $100 billion. It is more than great -- in spite of the packaging. You can shop when you want. Selection is wide and deep and shipping is generally good (especially with Amazon). At some point web sites will enable us to establish fulfillment models where we can set up a schedule for things we just want to show up outside the garage door on a scheduled basis. Paper towels, a case of oil, printer paper, stockings, and of course potato chips. I envision receiving an email at some point from a web merchant saying "Mr. Patrick, we have been shipping you two bags of potato chips per week for quite some time. We have calculated that you could save considerably on your shipping cost if you were to up that to 12 bags per month instead. Click here if you would like us to modify your fulfillment model as suggested." But then still, there are the "worms".

Hopefully marketing will come to the rescue. Good marketing involves paying attention to the "end to end process", e.g., not just assuming that the job is getting the package to the customer but going the next step and helping the customer unwrap the package, get rid of the packaging material and start enjoying the merchandise that was delivered. There have been many new business models on the Net and I am confident we will see successful marketers keep uncovering more and more ways of satisfying their customers, by looking at possible annoyances, and solving them. We also need some breakthroughs in the packaging area. As more and more arrive at the door via package delivery companies, what will we do with all the "worms"? As people buy more and more on the Net will they get turned off by all the packaging materials they have to deal with? There is room for leadership here and breakthroughs are possible. I used to be so frustrated with opening the half gallon orange juice cartons. Did I say opening? I meant mutilating. Then along came International Paper with a breakthrough idea -- the screw cap on the carton. Great! Now what we need is self destructing "worms" and instantly collapsible cardboard. National Starch & Chemical has a product called Eco-Foam which is a starch-based biodegradable packaging material. Metabolix uses microbial fermentation of sugars to create totally biodegradable alternatives to petroleum-based plastics. The ultimate will be "worms" that do not stick to your clothing and can be put down the drain without hurting the environment.

Note: This story was originally written as a Reflection on July 31, 1999 and then edited on May 28, 2008

On Demand , e-Business May 28, 2008 02:25 PM

Microcapital

The final speaker at IBM's Business Partner Leadership Conference in Los Angeles was Nick Donofrio, the company's Executive Vice President for Innovation and Technology. Always an emotional, enthusiastic and at times nostalgic speaker, little did the audience know that the next day IBM would announce that Nick will be retiring on October 1 after a fantastic career of forty-four years. I have no doubts that he will end up involved in many activities and will find that he may need to go back to work to regain some spare time.

One of Nick's many leadership roles at IBM has been with the Global Innovation Outlook program. One of the recent GIO events brought together a diverse group of global thought leaders for a series of brainstorming sessions about the future of innovation and economic advancement in Africa. One of the greatest needs identified was to provide access to capital and financing to more of the African population. It was clear that there could be significant growth and transformation if there was a more open, scalable, lower-cost microfinance hub serving the African continent.

IBM and CARE have announced plans to enable microfinance institutions to dramatically lower the costs of providing financial services to large populations in the region who have no access to banks. The goal of the new Africa Financial Grid is to help alleviate poverty and promote economic development in the Sub-Saharan Region. The two organizations plan to establish an Africa Financial Grid built around a shared services and infrastructure model designed to significantly reduce operating costs, streamline lending processes, scale rapidly, and integrate with other resources such as credit bureaus, financial institutions and international payment networks. The Grid will also eventually be able to link with mobile payment providers in Africa to enable customers to repay loans or transfer money via mobile phones. The project will initially target 11 countries with a combined population of more than 400 million people.

There are millions of people with business ideas and aptitudes but with incomes of less than $100 per month, it has been impossible to get financing. A small loan can make a big difference. For example, a loan of $50 enabled a mother of six to purchase fabric and sell embroidered products. Based on her success she was able to get subsequent loans and expand her business. Very small loans can have a big impact but it has been too costly for financial institutions to make the loans practical. The combination of technology and expertise that IBM and CARE bring to the table has the potential to change the model and have a huge impact. One more example of how the Internet continues to empower people.

IBM , Internet Technology , Mobile , People May 19, 2008 07:41 AM

The World in 2050

The flight to Los Angeles last week was long but on schedule and it provided some time to make a dent in reading World Without End (sequel to The Pillars of the Earth) by Ken Follett on the Kindle. Holding the 10-once e-reader is a joy and the battery lasted throughout the six hour flight. The physical book -- 1,024 pages -- would not be a joy to hold for hours.

The purpose of the trip was to attend IBM's Business Partner Leadership Conference. The event was attended by roughly 1,000 business partners, IBM executives, members of the press, and information technology analysts. See "IBM Happenings - May 2008" for a list of some of the announcements made by IBM during the meeting. At the end of the first day was a special event at the University of California School of Cinematic Arts. The invitation only event included 100 or so analysts, members of the press, faculty members and students. IBM and USC had been holding discussions to map out a collaboration between some of the most creative minds in Hollywood with some of IBM's top scientists. Having known some of them for years I was really pleased with they selected. The moderator was Dr. Bill Pulleyblank, mathematician, computer scientist and predictive analysis expert. Bill is known for having managed a project in which a supercomputer named Deep Blue beat Gary Kasparov in a six game rematch. The panelists were all quite distinguished. Don Eigler, IBM Fellow, was the first ever to precisely manipulate individual atoms and spelling the word "I B M". Jeff Jonas, IBM Distinguished Engineer, expert in security and privacy, created much of the technology used in capturing criminals in Vegas casinos. Sharon Nunes, Head of the Energy and Environment business at IBM is a research expert in materials science and is working on numerous projects to save the environment. Last but not least was Ajay Royyuru, who leads IBM Research's computational biology team and IBM's liaison to the National Geographic Genographic project. Ajay participated on a past panel which I had the honor to moderate at Demo.

The breadth and depth of the panel could have kept the audience spellbound for quite a few hours. Will the future be like 2001: A Space Odyssey, Back to the Future, Incredible Journey or Star Wars? How can scientists help filmmakers create prescient depictions of the future?

Much of the discussion revolved around the merger of biology and systems. Some of the breakthroughs discussed included using nanotechnology to assure the availability of clean drinking water everywhere on the planet, self-healing spinal cords, and life span stretching well past the century mark? The human genome has been mapped but that is just the beginning. In effect the mapping provides the parts list of the human bodies. The next phase of research is to figure out what all those parts do and how they fit together. Not only will regenerating entire body parts be possible but embedded processors under our skin will make it possible to gain significant human augmentation of our capabilities. A project in Europe called Blue Brain is using IBM supercomputing technology to built a simulation model of the human brain. This is a very big undertaking but someday it could lead to curing some of the most dreaded diseases that afflict our societies.

Computer processing is already awesome but we haven't seen anything yet. A Mini Cooper has more computing power than Apollo 13 had. At the exponential pace of growth of computing capacity we may actually reach the Singularity in the next couple of decades.

Security and privacy are obviously crucial elements to the research agenda. We will be able to have an embedded super-PDA that can record every conversation you hear or say during a lifetime. Existing databases make it possible to specifically identify a person by only knowing their zip date of birth and gender. So much for witness protection programs. The good news is that ubiquitous sensors can make the world is less dangerous place. Yes, the government can watch the people, but the people can watch the government too.

I think we are very fortunate that IBM focuses vast sums of money and thousands of top notch people on solving some of the tougher global problems. There is money in some of it and long term business value is created but along the way societies around the world benefit greatly from IBM's work toward the greater good. Take a look at the most recent report on this to get an idea.

As for film making, I learned a lot in talking with some graduate students at the reception. They are all hoping to be as successful as Steven Spielberg, and no doubt some will. The surprising thing I learned is that the best quality movies are still captured on cellulose acetate based film. It is rare these days to see a professional photographer use anything other than a digital camera and apparently with wide angle, high contrast movie making, the industry is not quite there. Consensus was that it would be all digital within five years. Computers already play a huge role (no pun intended) in film making either for augmentation of scenes or for creating the very characters of the movie.

Conferences , IBM , Internet Technology , Media , People May 15, 2008 11:21 AM

Not a Good Fit

I have to admit that I am not surprised that the Microsoft - Yahoo! deal fell through -- in fact I thought it would. It is not the issue $33 per share or $37 per share. The issue is a mismatch in culture. I remember when Jerry Yang and David Filo, both Ph.D. candidates in Electrical Engineering at Stanford University, received an award at Internet World in 1994. They had converted their student hobby into a business that went on to have a major impact on the growth of the Internet.

"Jerry and David's Guide to the World Wide Web" became Yahoo! -- an acronym for "Yet Another Hierarchical Officious Oracle" but Filo and Yang also claim they also selected the name because they liked the general definition of a yahoo: "rude, unsophisticated, uncouth." The Yahoo! web site ran on Yang's student workstation, "Akebono," and Filo's computer, "Konishiki" - both named after legendary sumo wrestlers. I don't know for certain but I would bet anything these were both Unix systems. I also suspect that most of their development since the early days has been with Unix or Linux and certainly a lot of open source software in conjunction with the proprietary innovations they have created.

Microsoft has a lot of money and a lot of really smart people but the culture is different. Seems reasonable to assume that MSN was built on Microsoft's software -- if not then that is another story. MSN and Hotmail do not have the best reputation -- at least with those close to the Internet. Some would say Microsoft had sought to subsume the Internet in the early days while Yahoo has consistently embraced the Internet from day one. Microsoft has the reputation for being a place where workers toil individually while Yahoo has been is a Silicon Valley archetype where employees tend to work collaboratively.

The bottom line is that Microsoft and Yahoo! are both successful in their own ways but arguably they are oil and water. Merging them might make sense to the financial analysts but it makes no sense to many observers. If they were to come together financially it would take a decade to fully integrate the two to gain the benefits that would be expected. It may not be possible.

One thing is for sure. The beneficiaries of the failed merger will be the lawyers who will take many millions of dollars from both company's shareholders to sue and defend the failure to buy or sell.

Internet Technology , Media , People May 4, 2008 06:34 PM

IBM Happenings: April 2008

It has been a busy week for me here in Los Angeles at the IBM Business Partner Leadership Conference learning about many new announcements from the company and getting to hear visionary guest speakers on a broad range of topics. More stories to come about this over the next few days and weeks. The whole month of April was filled with a slew of IBM announcements in hardware, software, services, acquisitions, and strategic alliances. The list of announcements made during the month is here.

Complete index of IBM Happenings

IBM May 2, 2008 02:10 PM