April 2007

Microsoft Vista

April 1, 2007 from CAmagazine – "If you’ve heard anything at all about Microsoft Windows Vista, you are probably wondering whether it’s worth upgrading to the new operating system. The short answer is a qualified yes. It offers a lot of advantages in security, connectivity, collaboration and ease of use. However, because of those new features, you might find your existing PC or laptop does not have sufficient memory (RAM) or processing power (CPU) to run it…"

Microsoft’s ERP Wave Hits Shore

March 15, 2007 written by Michael Burns of 180 Systems – When Microsoft Corp. acquired Great Plains Software Inc. in 2001 and Navision in 2002, the force about to be unleashed in the ERP marketplace was not well understood. Many people wondered what Microsoft was up to. How could they expect to be successful in the ERP space, which is so different than all their other markets?...

Microsoft Evolves its Enterprise Plans

March 17, 2007 from PC World – “When the vendor (Microsoft) first started talking about Project Green in 2003, the initiative focused on bringing the disparate products then known as Axapta, Great Plains, Navision, Solomon and CRM together into a single code base. Then in May 2005, Microsoft began to talk more about having two distinct waves of the projects. Wave one committed Microsoft to bringing out major new releases of each of its business offerings, while wave two, due to start occurring in 2008, was when the company would begin releasing elements of the converged code base.

By September 2005, Microsoft brought its back-end applications together under a single brand name "Dynamics" resulting in the rechristening of its business applications as Dynamics AX, GP, NAV, SL and CRM. At that point, the vendor announced "Dynamics" would also refer to the ongoing Project Green research and development road map, but the old name has refused to die and still persists among the company's executives, partners and customers.
Fast forward to this week's Convergence show in San Diego and the natural question is what's happening with Project Green? Is a converged product or platform still on Microsoft's agenda?

"We don't have the goal of just convergence for convergence's sake," said Satya Nadella, corporate vice president of Microsoft's Business Solutions group. "We've delivered on Wave 1 and, with each sharing of technology, we're increasing the level of convergence, but it's not a front and central goal. We now have a common portal, a common UI (user interface) and common Web services infrastructure. Perhaps the news here is that Green's done," he added…”

180 View – I (Michael Burns) was at also at Convergence – see the article above entitled “Microsoft’s ERP Wave Hits Shore”. At Convergence, I asked Satya Nadella the question about the future of Project Green. There is still some confusion about Microsoft’s enterprise plans. We were told that all the products will share the same user experience. However it’s not so clear what will happen with the four Microsoft ERP systems. What I heard is that each product will continue to evolve but they will gradually become more differentiated. Microsoft also announced that they will focus on five industries – Manufacturing, Distribution, Professional Services, Retail and Public Sector. I anticipate that each product will be mapped to one of these industries and if more than one is mapped to a particular industry, there will be other differentiators.

MS After Convergence: Shakeup in Dynamics Leadership

March 21, 2007 from eWeek – “A little more than one week after Convergence, Microsoft's big annual user conference that highlights the company's Dynamics brand of ERP and CRM software, Microsoft quietly made some changes in the Business Solutions executive lineup.

Satya Nadella, corporate vice president of Microsoft Business Solutions, and effectively the leader of the Microsoft Dynamics group that includes the company's four separate enterprise resource planning suites and customer relationship management offering, will be joining the Platform Services Division to lead a new division, the Search and Ad Platform Group. Nadella will transition from his current role in the Business Solutions group by April 19…”

180 View – I was wondering about the keynote and subsequent presentations by Satya Nadella at Convergence. He seemed extremely knowledgeable but lacked passion. Now I know why. Why he did not get the job is another matter. My guess is that he was having a hard time replacing Doug Burgum, who seemed to inspire the troops.

Giant tech, small package

April 2007 from The Financial Post – “Historically, small businesses across Canada haven't been as switched on to technology as their larger counterparts. That's partly because the investment and organization necessary to roll out a big IT project has been beyond them. That left key technologies such as enterprise resource planning (ERP) and customer-relationship management (CRM) almost exclusively in the realm of big business…”

180 View – We don’t agree with the premise that ERP is only for large companies. ERP systems provide a business solution across most if not all departments in one organization. With this definition, QuickBooks and Simply Accounting are also examples of ERP systems. Nevertheless, it has been difficult to obtain all the functionality in the higher end systems at low costs until recently. One way to lower costs is to use the ASP (Application Service Provider) or SaaS (Software as a Service) model as is described in the article with NetSuite.

Lawson and IBM Join Forces to Attack the SMB Market

February 2007 from Aberdeen Group – “On February 1, 2007 Lawson and IBM jointly announced an expanded relationship to better serve small and mid-size businesses (SMB) in North America. Under this agreement, IBM will co-develop, sell, and implement solutions specifically designed for the needs of banking and insurance companies, and for manufacturers of fashion and food and beverage products. The solutions will be based on Lawson’s S3 and M3 enterprise management applications.”

180 View – The M3 system mentioned is the former Movex product from Intentia, which was purchased by Lawson. Lawson/IBM will be competing with SAP, Oracle, Microsoft and many others including themselves as they also implement SAP and Oracle. The SMB Market has many interpretations. Our view is that Tier One products like SAP, Oracle and Lawson are targeted to companies with revenues of $200 Million and up.

Emerging Trends in Compliance

March 2007 from IT Compliance Institute: – In this article, the author discussed emerging trends which included:

“The first several years of SOX involved a mad dash to get needed IT controls in place to ensure compliance. Firms typically first instituted manual controls, and have been steadily replacing those controls with automated ones, to create more easily repeatable, demonstrable, and cost-effective compliance.

Unfortunately, many of these controls are actually ineffective, claims Forrester Research analyst Michael Rasmussen in a recent report. The problem: “In a rush to avoid being fitted for orange jumpsuits, firms don’t devote nearly enough consideration to the adequacy of the controls that compliance teams are implementing.” Rather, many companies rely on one-size-fits-all checklists of controls—“because firms all want a ‘get out of jail free’ card that assures their executives that if they do these three things in order, litigators and regulators will leave their companies alone.”

As a result, he says, “many compliance teams have implemented controls that may not make sense for their businesses.” Thus controls are either overblown, which siphons off valuable IT time and resources; or more often insufficient, which leaves organizations vulnerable to attack, as well as potentially noncompliant with regulations. Hence as regulations mature, expect auditors to take a much closer look at whether in-place controls actually do the job...”

“Increased security spending will also be needed to comply with the Payment Card Industry Data Security Standard (PCI DSS) version 1.1, which was released in September 2006. The PCI DSS is a security standard that was developed by the founding payment brands of the PCI Security Standards Council, including American Express, Discover Financial Services, JCB, MasterCard Worldwide and Visa International, to help mitigate emerging payment security risks, while facilitating the broad adoption of payment account data security. Simply put, PCI specifies minimum policies, procedures, data security, network architecture, and more for any merchant handling credit card data. Unlike SOX, which many deride as being so vague that many auditors aren’t even sure what it requires, experts say PCI is a model of clarity, clearly spelling out what companies must do…”

180 View – Hopefully it’s not as bad as Forrester claims. No doubt SOX has been expensive and in the end it’s unlikely that the benefits exceed the costs. However it’s another matter if the new SOX controls have been both ineffective and inefficient. We see a parallel in replacing ERP systems as a result of Y2K. The implementations were often done in a rush without consideration of optimizing business process at the same time, which is what ERP should be all about. In the same way, organizations rushed into compliance without concerns for efficiency and effectiveness. Expect a second wave of compliance to include business process improvement.

Warehouse Automation--What's Really Working For Pallet, Case, and Piece Pick Operations

January 2007 from the Aberdeen Group – “Warehouse Automation” is a broad term that encompasses many different individual technologies. The following is a list of the primary technologies Aberdeen has analyzed for this benchmark report:

Bar-Code Scanning
Bar-coding has been used in distribution centers for decades, and it remains the most commonly adopted form of warehouse automation today. It is reliable and relatively inexpensive. Bar-coding is typically used in a real-time environment, with data being transmitted back and forth via a Wireless Local Area Network (WLAN).”

Voice-Directed Picking
Voice-Directed Picking was widely introduced in distribution center environments in the 1990’s and now is used heavily in certain industries such as grocery distribution. It is used in areas where workers benefit from being able to use both hands to perform their work, without ever having to take their eyes off of the task at hand.

Cart-Based Picking
Cart-Based Picking is both a technology and a methodology. Cart picking excels in cluster pick operations, where several orders are picked at the same time with a single pick path through the warehouse. Keeping track of which items belong in which orders can be challenging; hence, cart-based cluster picking often involves secondary technology such as bar-code scanning, voice-directed picking, and pick-to-light systems…”

Aberdeen has broken out its Best in Class framework according to three key metrics:

• Labor cost reduction
• Percentage of on-time and complete shipments
• Pick accuracy

Very few companies were Best in Class for all three categories – meaning that there is more than ample opportunity for even those considered top performers to improve their operations…”

180 View – Warehouse management means many things to difference companies. Many ERP systems have the basics, but don’t include features such as cart-based picking and other technologies discussed in the Aberdeen report.

Ideagora: A Marketplace for Minds

February 15, 2007 from Newsfactor.com – “A growing marketplace for ideas, innovations, and uniquely qualified minds is changing the long-standing rules of innovation and talent management. Companies seeking solutions to seemingly insoluble problems can tap the insights of hundreds of thousands of enterprising scientists without having to employ everybody full-time. This shift is rippling through Corporate America and changing the way companies invent and develop products and services.

Take Colgate-Palmolive. The company needed a more efficient method for getting its toothpaste into the tube -- a seemingly straightforward problem. When its internal R&D team came up empty-handed, the company posted the specs on InnoCentive, one of many new marketplaces that link problems with problem-solvers.

A Canadian engineer named Ed Melcarek proposed putting a positive charge on fluoride powder, then grounding the tube. It was an effective application of elementary physics, but not one that Colgate-Palmolive's team of chemists had ever contemplated. Melcarek was duly rewarded with $25,000 for a few hours work…”

180 View – Got any good ideas? Better yet, if you need some, there’s a place to get them.

What's to Be Done About Performance Reviews?

November 27, 2006 from Harvard Business School – “The topic of performance reviews triggers a wide range of complex responses. The fact that most of their strongest critics elected to reply anonymously to this month's column suggests that there are also political overtones to the subject. This month's debate was much like a case discussion, one that is often hard to summarize. But in an attempt to do it, here is my "take" on what you have said collectively…”

180 View - While this Harvard Business School article and related survey addresses many of the important issues surrounding Employee Performance Reviews, perhaps a ‘refresher’ on the importance of performing such reviews would be helpful.

Most of the companies that Lawrence Young has consulted with only do employee performance reviews on an annual basis, and usually as part of a yearly salary review. Lawrence suggests that employee performance be evaluated on a quarterly basis at minimum, and that these reviews are of a great benefit to not only the employee, but to the company and the employee’s supervisor as well.

Performance evaluation benefits the employee by:

• Translating job duties into specific performance expectations (goals/strategies) and standards;
• Prioritizing goals to be accomplished during the evaluation period;
• Helping the employee focus on the job and on how it contributes to the overall goals of the business unit;
• Providing meaningful job performance feedback;
• Providing concrete suggestions for how job performance can be improved;
• Laying out a plan for future career development;
• Recognizing work achievements;
• Providing a formal opportunity for the employee to inform the supervisor about barriers to work accomplishment, to ask for clarification of duties and roles, to identify resources and tools needed to help improve performance, and to highlight work achievements and the strengths he brings to the job.

Performance evaluation benefits the supervisor by:

• Clearly communicating job performance expectations and standards to all parties involved so there is no basis for confusion or disagreement later on;
• Serving as formal documentation of numerous personnel actions such as training needs, performance improvement needs, recognition of goal accomplishment and exceptional performance, pay increase, job redesign, and discipline;
• Providing a means of either encouraging the employee to continue good work or to change/improve in areas that don’t meet expectations;
• Providing an opportunity in time to paint a picture of past performance and lay a roadmap for future planning and development;
• Reinforcing the employee’s accountability for job performance
  

Performance evaluation benefits the company by:

• Communicating to employees the overall corporate strategic plan so that they can plan for the future;
• Engaging everyone in the organization, from top to bottom, to help the company successfully fulfill its mission;
• Helping to define and clarify roles – who does what, how and when – in order to foster responsibility and accountability throughout the workplace;
• Helping determine when program and policy changes need to be made;
• Aligning the work goals/strategies of each employee with the mission and strategic goals of the company in order to deliver its products and services effectively;
• Providing a uniform method of giving each employee constructive feedback about their job performance.
  

According to Lawrence, the importance of doing employee performance reviews on a frequent and regular basis cannot be overstated. “After all” says Lawrence, “you cannot manage what you cannot measure!”

By the way, are you aware that there are usually government grants available to train your employees if your company is based in Quebec and its gross payroll in 2006 was between $1 million and $5 million?

As well, there are a host of other grants, subsidies and cost-saving measures that may be able to help your company significantly reduce its labour costs and address its human resource issues.

To obtain more information, without cost or obligation, on how your Quebec-based company can benefit from one or more of these opportunities, please contact Lawrence Young at lyoung@180systems.com.

March 2007

Customer survey roundup no. 3

March 1, 2007 from CAmagazine written by Michael Burns – Check out the results of our 3rd customer survey of accounting and ERP systems. See how well readers like the systems they're using, and how they rate the developers and implementation partners. We also asked for some general feedback about return on investment and future plans. Unfortunately, we did not get sufficient responses to break the results out by vendor, but there should still be a lot of useful information for your review.

Tricks of the Trade (A few ideas to improve productivity)

February 2007 from 180 Systems – Many people spend the majority of their time with a few programs that they know well enough to get the job done. They realize they could find a more efficient way to get the job done, but the effort involved seems to outweigh the benefit. So they’re stuck in a rut. This article will give you a few ideas to crawl out.

One big waster of time is searching for information. Let’s assume that it’s on your computer somewhere and you keep everything important. The 1st trick does not involve recent technology, just common sense. Organize your documents and email in folders or directories. However even if you’re diligent in filing things away, you could be looking for something that spans directories, email and different document types. There are solutions that are easy and inexpensive that will automate the search process. All you need to do is type the keyword and you can instantly see a subset of files or emails that contain the keyword. And the keyword does not need to be a tag that you manually apply. It’s just text somewhere in the document or email. There are solutions like X1, Google desktop, ISYS that can help. And Microsoft Vista (The new Windows system) now includes search right out of the box.

Meetings are also right up there as big wasters of time. Once again, you can use common sense to reduce the wasted time by making sure everyone gets to the meeting on time, establishing a tight agenda, issuing documents in advance…. But technology can help too especially if the participants are not in the same office. Try one of the web conferencing tools such as WebEx or GoToMeeting.

You can also waste time flipping back and forth between documents. Windows does let you split the screen and synchronize or de-synchronize scrolling, but you don’t see as much as you would like. The solution is relatively inexpensive by using a dual monitor or using one of your old clunkers to view a document while you do the heavy lifting on your new PC.

When creating presentations or writing documentation, you will want to copy something that appears on your computer screen. There has always been the PrintScreen function that can give you the whole screen or just the current window by also using the ALT key when you press the PrintScreen function key. But if you can’t do it because there are restrictions on the document you are reviewing, or you want to be more picky, there is help using a program such as SnagIT. (I know I don’t need to remind you to give credit to other people’s work and make sure that you are not violating copyright)

There are also many time savers in the programs we use everyday. The best way to leverage these tricks of the trade is to provide training. Why not have a series of lunch and learn sessions? Get your best technical person to show time savers in MS Word or Excel. For example, teach the group how to do multiple selects from a list using the CTRL or ALT key or to automatically populate a series of days, months, years… Take a look at Office Watch for instruction on how to use AutoFill

We are sure there are many other ways to be more efficient, and would welcome any of your suggestions. Please update the blog with your suggestions. Thanks

180 View – We wrote it so you already know our view.

Customer relationship management doesn't have to be complex and expensive

February 7, 2007 from ITbusiness by Vawn Himmelsbach – “While the idea of installing customer relationship management (CRM) software can be intimidating to smaller businesses, it shouldn't be. In fact, it doesn't have to be either complicated or expensive for those companies that consider themselves SMBs…

Both small and large companies require a central repository of customer information, says Michael Burns, president of Toronto-based 180 Systems. The most basic CRM systems include a contact management system; but more sophisticated features include sales force automation, marketing automation and service management (but as a small company, some of these features may be overkill)…

At one point in time there was a differentiation between front-end systems, like CRM, and back-end systems, like accounting or ERP, but that distinction is gradually fading, says Burns. Now it's recognized that you require both, and even the most basic of systems will usually contain CRM components. Several accounting packages have tight integration with products from top-tier CRM vendors, for example.

"It's hard for any company that has an application that automates your enterprise to exclude CRM," says Burns. But, he adds, if you don't have it, you're going to have a hard time down the road selling your wares.”

180 View – Great article by Vawn especially considering that she has quoted us.

Oracle Buys Hyperion

March 1, 2007 from CRN – “Oracle said it would create a more comprehensive business intelligence software suite following its US$3.3 billion acquisition of Hyperion on Thursday. The two firms said the deal, which is expected to close sometime next month, would allow Oracle to integrate Hyperion's business performance management software into its own business intelligence (BI) product. Oracle's first BI product was released at the beginning of last year.

Hyperion started out primarily as a provider of financial reporting services but has also become successful with its online analytical processing (OLAP) engine, which allows users to quickly analyze complex queries. A few years ago, Hyperion made a strategic acquisition of its own when it spent US$140 million to buy Brio, which gave it an improved query tool…”

180 View – The acquisition represents the growing trend by ERP vendors to provide an end-to-end solution. Initially ERP was a back office application (financials, distribution…) Then it included the front office (CRM, eCommerce…). And now it includes Corporate Performance Management / Business Intelligence. In the short run, this aquisition should be good for all concerned. But what happens when sales fall off as a result of Hyperion prospects who are reluctant to acquire Hyperion because they don't use Oracle ERP systems?

The Magic of BI

September 28, 2006 from SQL Server Magazine – “According to Gartner’s Magic Quadrant for Data Warehouse Database Management Systems, 2006 report (published September 12), Microsoft’s BI platform revenue grew at a rate of 35.9 percent in 2005. And Microsoft’s recent earnings reports (http://www.microsoft.com/msft/earnings/default.mspx) document that Microsoft SQL Server revenue as a whole also grew 35 percent year over year in the fourth quarter of fiscal year 2006. In Microsoft’s press release about its BI growth (http://www.microsoft.com/presspass/press/2006/sep06/09-22BIMomentumPR.mspx), Jeff Raikes, president of the Microsoft Business Division, says:

“Our ongoing BI investments are enabling a transformation of the way people interact with important business information. We continue to evolve our solution set, recently rounding it out with an integrated performance management application, such that our offering will provide customers with a complete, flexible and cost-effective BI solution, one that enables truly pervasive BI across the enterprise.”

Those of you familiar with Gartner’s magic quadrant model know that it breaks vendors into four categories: niche player, challenger, visionary, or leader. Garner assigns a vendor’s standing in the quadrant based on the vendor’s completeness of vision and ability to execute that vision. Gartner’s recent magic quadrant report shows that Microsoft has made great progress across the board in data warehousing and is now on the line between challenger and leader.”

180 View – Here is another indicator of Business Intelligence becoming part of the end-to-end strategy of ERP vendors. Microsoft has a huge advantage over many of its rivals, and will exploit this advantage over the years to come.

How Real Is the Software as a Service Phenomenon?

February 2, 2007 from IT Business Edge – “Info-Tech surveyed more than 1,900 IT professionals, including more than 200 recruited by ITBE. In one area of the survey, respondents were asked to quantify the impact of SaaS as a proportion of new software spending over three time periods: two years ago, today, and two years from now.

The results show that SaaS, while still accounting for a modest portion of new software purchases, is a growing force in the industry. This year, on-demand software is expected to account for 20 percent more of your software acquisition budget than it did two years ago. If our respondents’ forecasts are correct, it will grow by a further 30 percent over the next two years. In the near term, the uptake has occurred primarily in small organizations (1-100 employees); these were already about 20 percent ahead of the industry-wide use of SaaS two years ago, and have increased by roughly 25 percent since then.

However, looking forward, it is large accounts that see the greatest proportional future growth. IT professionals in enterprises with more than 1,000 employees believe that although their organizations have been slower to respond to SaaS than smaller firms, they will experience strong growth – perhaps as high as 40 percent – in the proportion of new software acquisition budgets allocated to on-demand products.

180 View – The name has changed from Application Service Provider, but SaaS has now become mainstream. We now typically include SaaS vendors in our RFP’s. They don’t always win the day, but it’s not because the SaaS model doesn’t make sense. It’s more often that the products are not as mature as their on-premise/license-based counterparts.

RightNow aims to take on SAP

February 15, 2007 from ZDNet – “Greg Gianforte, the outspoken CEO of RightNow Technologies, says the market for customer relationship management software in Europe is booming--and he predicts that some of his company's biggest wins will come at the expense of industry heavyweights SAP and the Oracle-owned Siebel.

Gianforte says chief information officers are tired of what he calls costly and time-consuming on-premise implementations. His company, he says, is picking up enterprise customers from both of his big-name rivals. "We beat SAP at Nikon, for all their campaign management. We threw Siebel out of Electronic Arts. And those are just some of the ones who are prepared for us to talk about it," Gianforte told Silicon.com.

He said many companies are unwilling to admit when they've been forced to ditch costly software rollouts: "You have to understand this is fairly embarrassing for these companies because they made big investments and couldn't get value."

Gianforte singled out market leader SAP for criticism, on the back of recent poor results. "You could drive a truck through the cracks in SAP's armor," he said, claiming he would much rather have his current problem--the recent announcement of $49 million in losses related to a change in RightNow's licensing model--than those of SAP or Siebel, which have to turn around far larger businesses…”

180 View – Although Greg Gianforte is biased, he also has a point or should we say a sharp knife for his competitors. We actually agree with Greg in that the complex/costly implementations are now history. The mid market is where lie all the new business opportunities, and mid market companies won’t put up with complex/costly implementations.

Update on Workday, the new “on-demand ERP” company

February 23, 2007 from AMR Research written by Bruce Richardson – “When Workday came out of stealth mode for its launch last November, the company had already signed its first three customers. Over the last few months, it has added eight more. The new customers include two brand names in on-demand software: salesforce.com and RightNow Technologies.

The company has grown to 90 employees, up from 40 or so when I first visited the firm’s Walnut Creek headquarters last April. Head count will likely grow to 150 or so by the end of the year. Most new hires will likely be in development and customer support. Based on our conversations, it appears that Mr. Duffield is looking to control growth and assure high customer satisfaction. When asked how many new customers he hopes to sign this year, he said 30. While that represents strong, triple-digit growth, it is more manageable than the software industry’s classic strategy of aiming primarily at sales wins, not “go lives.”

Believe it or not, it’s been nearly 20 years since Mr. Duffield and Ken Morris started PeopleSoft. When I asked what was different this time, Mr. Duffield said that the tools they are using today are superior. He also said PeopleSoft didn’t get its first customer until the company was two and a half years old, and it took a year for the first customer to go live.

Now, the new tools allow the firm to come out with major enhancements every six to 12 months. Customers are able to go live on the first modules in three months. This typically includes human capital management (HCM) and payroll. The follow-on project usually involves employee self-service applications, which take a month or so to implement.”

180 View – Mr Duffield has a lot of advantages over his competitors. He has no baggage code to update. He has the latest and greatest tools to work with. He knows the ERP business. He is well connected and well funded. His business model is now accepted as mainstream. Keep your eye on this one.

Shedding Light on Internal Control Requirements

February 2007 from Crowe Chizek – “Near the end of 2006, the U.S. Securities and Exchange Commission (SEC) and the Public Company Accounting Oversight Board (PCAOB) took steps towards making significant changes in how the internal control provisions of the Sarbanes-Oxley Act of 2002 (SOX) are applied…”

180 View - The article discusses the history, problems, and potential changes to SOX. The PCAOB had invited comments on the proposed changes and the deadline for response has just passed. We could not find much yet about the responses except for the following:

February 27, 2007 from webCPA – “A flurry of e-mails and letters arrived just under the deadline for the Public Company Accounting Oversight Board’s 70-day comment period regarding proposed changes to the audit standard on internal controls over financial reporting.

Just before Christmas, the five-member board unanimously voted to circulate a proposal that would trim the amount of testing required for auditors to evaluate internal controls over the financial reporting process.

Through the weekend, the board had received 55 comment letters, and that total nearly doubled before the close of business Monday. By the day’s end, a total of 97 pieces of correspondence had been posted to the PCAOB’s Web site. The majority of the nearly 700 pages of comments were highly detailed in citing the specifics of what a number of organizations and individuals supported in the board’s proposal, as well as possible improvements that could be made to the guidance.

Broadly-speaking, many of the comments fell into two camps, similar to the views expressed during a recent meeting of the board’s Standing Advisory Group, and, for that matter, in the four years since passage of the Sarbanes-Oxley Act. Investor advocates worry that more leeway in the controls could lead to lax audits, while business concerns -- such as the U.S. Chamber of Commerce -- worry that still not enough has been done to tailor the original guidance to make it manageable, and cost efficient, for smaller companies...”

When Good Teams Go Bad

January 31, 2007 from Harvard Business School – “What could better symbolize high-level business performance than an eight-oared crew team rowing in perfect unison, their boat powered by a selfless collaboration of strength, skill, and shared purpose? It's no wonder that advertisers love to use this image to depict successful teamwork

The rowing metaphor also caught the eye of HBS professor Jeff Polzer and HBS associate professor Scott Snook. The pair has produced a case about the behind-the-scenes dynamics surrounding a college crew team. But unlike the beautiful images favored by advertisers, "The Army Crew Team" case reveals a not-so-pretty picture of a frustrating and baffling decline in performance by the varsity boat at the United States Military Academy..."

180 View – Lawrence Young has worked with hundreds of companies implementing IT and HR projects whose success depends on team work. Lawrence has concluded that the maximum benefits derived from highly functional teams accrue when:

• The strategic and operational goals and objectives of the project are clearly identified and communicated to all team members.
• The culture of the team ensures a high degree of respect between members of the team.
• All team members clearly understand the basic dynamic of any team, which is that the whole exceeds the sum of the parts i.e. the overall success of the team exceeds the individual success of any given member of the team.
• Each team member is given appropriate responsibility to complete their assigned tasks, and is measured and held accountable by the team leader in a timely fashion.

But according to Lawrence, the most critical success factor in effective team work is ensuring that each team member is committed to the success of the overall project, and not merely involved in completing their assigned tasks. As Lawrence says, successful teams are all about bacon and eggs - ‘the chicken is involved, but the pig is committed’.

February 2007

Vista

January 29, 2006 from Canadian Business magazine – “It's been five long years since Microsoft booted up a new operating system and three since updating its popular suite of productivity software. So gird yourself for the sales pitch you're bound to hear in the coming weeks for the company's new Windows Vista OS and Office 2007 packages--both launched for businesses Nov. 30 and consumers Jan. 30--because it might sound a bit excessive for what, in the end, is just software. Microsoft has not reinvented the PC; it has merely made it easier to use.

"A lot of it is eye candy," says Naumi Haque, a research analyst at Info-Tech Research Group, based in London, Ont. "For the majority of users, what they have is already fulfilling their needs, so there's no immediate drive to upgrade to these products." And, Haque says, it's no different for corporations. A majority of Info-Tech's clients say Windows XP is exceeding their requirements--and, in some cases, even older versions of Windows suffice. The same goes for Office.

But if you're a Microsoft fan, you can't help but like the amount of work that has gone into Vista. For example, Vista automatically indexes everything on the hard drive and lets users quickly search for files and applications. A resizable preview panel reveals a thumbnail image of a file, and let's you scroll through its entirety before opening it. Also impressive is Vista's use of metadata tags, which are descriptive information about a file, such as the author and subject matter. The tags allow users to slice and dice search results in a variety of ways and customize how they sort categories of similar files. For example, growing digital music and photo collections can be organized on-the-fly by date, a star-rating system or personal tagging terms.

Much of Microsoft's focus on Vista for consumers has centred on solving digital-content overload and making the PC more fun to use. And, of course, there are updated 3-D glossy and translucent graphics. For business customers, Vista has tried to make IT departments happy with a more secure OS that's easier to back up and lock down. Vista also simplifies how corporate users adjust settings for presentations and find networks.

Similarly, developers of the Office 2007 suite of applications (Word, Excel, Outlook, PowerPoint, etc.) have directed their efforts toward some of the peripheral programs, such as SharePoint, to improve collaboration, workflow and document management for governance purposes.

But the big change everyone will notice in Office 2007 is what Microsoft calls the "ribbon," which replaces the familiar drop-down menus and floating palettes. The ribbon presents all the functions in buttons along the top of the screen, organized in contextual tabs such as Table and Review. It will take some getting used to, but it's supposed to put everything in plain sight and standardize the functions across all programs. The idea is that everyone, not just the experts, get more out of the applications.

And you might. But there is no killer feature that makes Office 2007 an essential purchase. "The decision to buy new hardware is going to be more important for the consumer than the actual decision to upgrade to Office 2007," says Haque. When it does come time to get a new computer, you won't miss the old Windows or Office--but you won't have that choice anyway.”

180 View –There has been so much in the press about Vista that is was difficult to figure out which article to quote. We have just completed our own review of the system, which will be published in CAmagazine in the near future. We recommend Vista if you have enough horsepower to run it, and your existing programs and devices will work. Microsoft does provide a free downloadable program called Upgrade Advisor which will tell you which of the various versions of Windows Vista is most appropriate and also whether you have any devices or software that may be incompatible.

CEO challenge

January-February 2007 from CAmagazine – “Since 2004, three waves of CEO and CFO certification have washed over corporate Canada, and there are more to come. All are aimed at restoring investor confidence in financial reporting and related controls by improving accountability and transparency — terms seldom heard during the ’90s, a time of heady growth, but which, since 2001, have resurfaced as key business, governance and disclosure principles.

Certification was introduced to Canada in 2004 when the Canadian Securities Administrators (CSA) required the CEO and CFO of a reporting issuer to certify the financial information in quarterly and annual filings. In 2005, that was expanded to include certification about disclosure controls and procedures. Last year, the third wave arrived. It requires certifying officers of TSX and TSX-V issuers to file the full annual certificate for financial years ending on or after June 30, 2006 — which, for many reporting issuers, means the calendar year ended December 31, 2006.

The full annual certificate in CSA Multilateral Instrument 52-109 expands the certification to require CEOs and CFOs to state they have “designed such internal control over financial reporting, or caused it to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with the issuer’s GAAP.”

In addition, they are required to certify that the annual Management’s Discussion and Analysis (MD&A) discloses any changes in internal control over financial reporting (ICFR) that occurred in the latest interim reporting period that have materially affected, or could materially affect, the ICFR.

This third wave of certification applies only to the design of ICFR, not its operating effectiveness. That will be introduced in a fourth wave of certification, yet to come…"

The Next Wave of Certification provides a straightforward, business-focused, top-down and risk-based approach for CEOs and CFOs to follow in assessing and certifying the design of ICFR. This approach will also help companies prepare for the future evaluation of the effectiveness of ICFR...

The September 2006 CICA publication Internal Control 2006: The Next Wave of Certification provides a straightforward, business-focused, top-down and risk-based approach for CEOs and CFOs to follow in assessing and certifying the design of ICFR. This approach will also help companies prepare for the future evaluation of the effectiveness of ICFR.

180 View – Note that requirements kick in “for financial years ending on or after June 30, 2006”. Also note that the certification is limited to design and not operating effectiveness, which means that the most onerous work required in the US under Sarbanes-Oxley is not required in Canada – at least not yet. But because of the backlash by public companies related to the cost of Sarbanes-Oxley compliance, the U.S. may water down their compliance requirements to be similar to Canada.

The article later goes on to say “The Next Wave of Certification provides a straightforward, business-focused, top-down and risk-based approach.” Straightforward sounds great in principle, but it’s not clear what is meant by it. Risk-based leads to efficiency in that there is no point on spending time unnecessarily if risks are minimal. Business focus means “companies should view their assessment of ICFR (Internal Control over Financial Reporting) as a business improvement opportunity, not just a regulatory compliance task.”

Enron’s Last Victim: American Markets

January 3, 2007 from the Cato Institute – “When the new Congress begins its session tomorrow, two familiar faces will not be present: Senator Paul S. Sarbanes and Representative Michael G. Oxley, who are both retiring. Mr. Sarbanes, a Maryland Democrat, has served for 30 years; Mr. Oxley, an Ohio Republican, for 26 — and their main legacy will be their joint attack on corporate corruption, the Sarbanes-Oxley Act of 2002.

The act, which was passed hastily in the wake of the Enron scandal, was surely well intentioned. But it has proven counterproductive in the extreme, and Congress would best honor the departing lawmakers by repealing it.

Sarbanes-Oxley has seriously harmed American corporations and financial markets without increasing investor confidence. The section of the law requiring companies to perform internal audits has turned out to be far more costly than proponents projected, especially for smaller firms. These costs have led some small companies to go private, hardly a victory for public oversight, and some foreign firms to withdraw their stocks from American exchanges.

In addition, the average "listing premium" — the benefit that companies receive by listing their stocks on American exchanges — has declined by 19 percentage points since 2002. This explains why the percentage of worldwide initial public offerings on our exchanges dropped to 5 percent last year, from 50 percent in 2000.

Other costs associated with the act may turn out to be more important. For example, more stringent financial regulations and increased penalties for accounting errors may make senior managers too risk-averse. Most chief executives are not accountants, so the requirement that they personally affirm their companies' accounts — at the risk of jail time should anything be amiss — may make them reluctant to partake in perfectly legitimate activities.

Paradoxically, Sarbanes-Oxley's strict rules on oversight by boards of directors would have been insufficient to prevent the collapse of Enron. By the act's standards, Enron had a model board; most members were distinguished professionals. The chairman of the audit committee was a former accounting professor and dean of the Stanford Business School.

Nor would the act's provisions to create a stronger Securities and Exchange Commission have made a difference. The commission had been aware of Enron's accounting techniques since 1992 and had never thought to question them.

Nor was Sarbanes-Oxley necessary in prosecuting the senior managers of Enron, WorldCom and other corporations where fraud was committed — all have been convicted of accounting fraud under laws predating the act.

The negative repercussions of the act on businesses might have been worth it if the act had achieved its primary goal: substantially increasing the confidence of investors in the accuracy of the accounts of firms listed on the exchanges. But that does not seem to have happened.

The best measure of investor confidence is the price-earnings ratio — the price that investors are willing to pay for each dollar of a company's reported earnings. The overall price-earnings ratio for the Standard & Poor's 500-stock index, however, has declined continuously since the Sarbanes-Oxley Act was being drafted in the spring of 2002.

Several leaders of the new Democratic Congressional majority have endorsed a relaxation of the audit requirements and other parts of the act. That is encouraging, but it is not enough. The basic structure of Sarbanes-Oxley is unsound.

One big problem is that the act nationalized the rules for corporate governance, reducing the value of the competition among the states for setting such rules. In addition, the act failed to resolve the major conflict of interest created when auditing firms are paid by the companies they audit. Rather than creating a regulation to change the system, Sarbanes-Oxley created an expensive and arguably unconstitutional new regulatory agency to regulate the audit firms' activities.

And, as is too often the case, Congress has rewarded the failures of the very bureaucracies that failed to keep up with Enron — doubling the budget of the Securities and Exchange Commission.

Tinkering is not enough. Sarbanes-Oxley continues to discourage smaller companies from trading publicly and foreign companies from listing their stocks on American exchanges. In the eyes of investors, it hasn't cleaned up any corruption, it has only forced companies to jump through hoops. As Senator Sarbanes and Representative Oxley drift into retirement, their act should retire with them.”

180 View – We think a risk-based approach to Sarbanes-Oxley coupled with a business focus (objective includes business improvement) would go a long way to restore the value in Sarbanes-Oxley.

Daylight-savings changes: No Y2K but there could be headaches

January 25 from Network World – “At first blush it may seem like no big deal: clocks will move ahead by an hour three weeks earlier than usual this year. But for today’s networked businesses, the simple change could mean complex problems if IT shops aren’t prepared, industry experts say.

The trouble goes beyond missed meetings and messed-up schedules to errors within time-reliant applications that are critical to a company’s business — processes such as operating room scheduling, billing and contract deadlines and ensuring record compliance, for example, could be at risk. Any applications dependent on timestamps will run into trouble after March 11, the new day for the daylight-saving time change, if actions aren’t taken.

For more than two decades, daylight-saving time has begun on the first Sunday of April and reverted to standard time on the last Sunday in October. But beginning this year, due to the Energy Policy Act of 2005, the daylight-saving schedule will be extended by a month, with the period beginning on the second Sunday in March and ending on the first Sunday in November. Legislators backing the change say it will save some 100,000 barrels of oil a day.

But the change also could throw a wrench in IT systems set up to automatically handle the old daylight-saving schedule. As a result, IT professionals need to take a close look at their systems and applications to determine which could be off when the change occurs and then take the necessary steps to correct them.

180 View – It seems like a reasonable precaution to check this out on your systems.

BI and CPM markets in 2007: When two become one

January 22, 2007 from IT Director – “For years analysts have asked suppliers "so which market are you in - BI (Business Intelligence) or CPM (Corporate Performance Management)?" Suppliers were somewhat coy about the answer. BI and CPM were perceived as distinct and separate markets. BI was the high margin Cash Cow and CPM was the Question Mark in the portfolio. Suppliers did not want to risk cashflow from the large $7bn BI market by gambling on the smaller $1bn CPM market. Hence supplier commitment to a CPM marketing message or a BI marketing message vacillated depending on whether cashflow or new market penetration was the current key directive. But all has now changed.

2006 was a great year for the CPM vendors and most registered 30%+ revenue growth. Sniffing opportunity, supplier indecisiveness vapourised overnight. The answer to the "which market are you in?" question has been categorically answered: "BOTH".

All the BI vendors are now firmly positioning themselves in the PM market. Business Objects will shortly unveil ambitious PM plans based on their acquisitions of ALG and SRC. Cognos boasts an Innovation Centre that delivers industry sector CPM solutions in Cognos Performance Blueprints. It now talks openly of "Cognos BI/PM solutions". SAP (with SEM) and Oracle (touting both its own CPM suite and the ex-PeopleSoft EPM suite) are pushing new BI and CPM solutions as part of their 'enterprise solution stacks'. SAS is leveraging its analytics market leadership position into enterprise PM products. Microsoft will launch its PerformancePoint PM suite in 2007.

Paradoxically Hyperion is moving in the opposite direction. Having led the CPM market from its inception it is now reverting to its BI roots and will present 'Why Buy BI from a Performance Management Vendor' at the upcoming Gartner BI Summit.

So what's next for the BI/PM vendors? BI as a category will gradually disappear, as OLAP did before BI. "Content Intelligence" will become the new category and the next holy grail. Already SAS, IBM and Cognos are offering enterprise search for unstructured data - emails, Word, PDF documents and the like.

If the BI/PM vendors can combine their mastery of data intelligence (as in BI) with text intelligence (as in document management) to slice and dice, drill down, and aggregate data and text for any question a user might care to ask, then customers will really have something to rave about - a way of emulating the way we currently work with paper. The answers to "where did I put that file?", "what does this information and data mean for the business?" and "what is the context for these conclusions?" will become only a mouse click away. The adoption of SOA will make this easier. Structured and unstructured data management software tools will converge facilitated by SOA.

Expect more acquisitions and new competitors in the Content Intelligence space. HP's recent acquisition of BI/PM provider Knightsbridge is ominous, as is Google's emerging presence in the Corporates with its Google (enterprise) Search Appliance - British Airways is a reference customer.

But what of the pure-play BI and PM vendors? In PM the likes of CorVu and Pilot will provide specialist niche market solutions to government, healthcare, and other markets where specialist non-standard PM solutions are required. BI 2.0 will emerge, but in a slightly different form than most commentators are predicting. High growth vendors such as QlikTech, Spotfire, and Tableau offer fast, flexible, highly interactive and visual solutions for knowledge workers. BI 2.0 will be for the scientific, technical, and professional knowledge workers - the rest of us will access more basic BI functionality and reporting as part of enterprise-wide performance management systems.”

180 View – We disagree with the author that BI and CPM are becoming one. All organizations require BI but only the larger ones need CPM that includes consolidation, strategic planning, scorecarding and forecasting.

What is Supply Chain Management Best Practice?

February 1, 2007 from Supply Chain Digest – “We all hear a lot of talk about supply chain and logistics “Best Practices”, including from me. But what are they, really? Are they truly useful?

This column was spawned, in part, from a panel discussion I moderated more than a year ago on Best Practices. It went in a direction I don’t think the panelists or the audience expected. By the end, we were discussing not Best Practices per se, but whether the concept was really meaningful. Somewhat to my surprise, neither the panelists nor audience, at least in this case, thought it really was. One consultant on the panel at one point near the end went so far as to say “Best Practice is baloney.”

Now, in fairness, this was a discussion centered around distribution center operations, and I think processing in a DC tends to be pretty situation specific, making (perhaps) the use of Best Practices less clear. To further think through this, we decided to get the opinions of a number of supply chain and logistics experts.

Ralph Drayer, ex-Chief Logistics Officer at Procter & Gamble and who now runs Supply Chain Insights, thought I was batty for even questioning the concept of Best Practice: “Shame on you! Of course there is such a thing as Best Practices,” Ralph told me. “The fact is that every situation is NOT really that unique, and believing so only adds to unnecessary complexity, cost and consumer value erosion.”

“That's why the consumer goods to retail industry pulled together under ECR [Efficient Consumer Response] and the Global Commerce Initiative to develop and publish Industry Best Practices for common processes," he added. "P&G did the same thing internally as we globalized our operations. A Best Practice is developed by a group of expert users who share their knowledge and experience to define the best method of operating a common process.”

There is strong merit in that perspective, to be sure. If a process is common across a company, then surely there is a “best way” to do it most of the time within that enterprise. And if a process is common across businesses generally, it would seem there is an opportunity for Best Practice – or is that commoditization?

Gene Tyndall, well-known consultant and SC Digest Contributing Editor (and a friend of Drayer’s) had a somewhat different view: “The term “Best Practices,” and the relentless pursuit of them, has caused more trouble than benefit. Everyone believes they need to find them, but then they cannot even define one, much less adopt it,” he said. “Even if you find one, it will change very soon, as someone else tops it.”

He added: “The trick, when you find one, is to "adopt and adapt" the practice to your unique situation. This is what people struggle with. I have argued for years that Dell and Wal-Mart (and others) do indeed have some, but others cannot adopt and adapt them. High-techs have struggled to do so, and K-Mart failed miserably. Others just say that their business models are different, which is a cop-out.

He also stressed the role of metrics: “Best Practices without performance measures, or metrics, are useless. Just like benchmarks, which without practices or processes are also useless.”

Jim Tompkins of Tompkins Associates, whose company runs a benchmarking consortium, agreed with Tyndall’s last point, focusing on the “result” aspect: “A Best Practice is a process that produces the best benchmark for a specific task," Tompkins said. "So, if the task being considered is inventory accuracy and one determines that 90% of the companies like my company, which have a benchmark of 99.8% or higher for inventory accuracy, utilize cycle counting, then cycle counting would be a best practice for my company. Furthermore one could look into the specifics of the best practices of cycle counting to gain more insights into how to best perform cycle counting.”

Ed Marien, well-known to many from his supply chain leadership at the University of Wisconsin and on-going consulting work, also focused on using benchmarking and metrics right. “The problem with many Best Practice comparisons is that they forget the metrics side,” he said. “The problem with many benchmarking studies is that the focus is upon the metrics, which may not be defined the same across companies or industry comparisons are made based upon metrics only, without considering the How To’s.”

I think I will make a "Part 2" of this column in a few weeks, incorporating some of your feedback. Netting it out here, though, I like the simple way Stephen Craig of transportation consultants CP Consulting answered when I asked him about whether there was such a thing as Best Practice. He answered: “I don’t know if there is Best Practice, but there is clearly Good Practice.”

SCDigest Technology Editor Mark Fralick took a similar tack, and maybe even summed it up best. In working with clients, he said, “I don’t worry so much about Best Practice as I do in eliminating Bad Practice.” Now that’s something I think we can all agree on.

180 View – We often hear the vendors offering “best practice” to their prospects. This article backs up our long-held belief what’s good for one company could be a disaster for another. It’s a great idea to know how others are doing it and compare metrics to benchmarks, but every company has uniqueness. If nothing else, the people are different with different motivations, which could have a huge impact on efficiency and effectiveness.

Salesforce.com and Deloitte Consulting Ally

January 30, 2007 from Destination CRM – “Salesforce.com is pairing with Deloitte Consulting in a strategic alliance that may enhance the on-demand CRM giant's ability to further penetrate into larger organizations. As part of the alliance, revealed on Tuesday, Deloitte will incorporate Salesforce.com's on-demand CRM apps and the Apex on-demand platform into its consulting services.

Salesforce.com's alliance with Deloitte will help give enterprises the confidence they need to develop, customize, integrate, and deploy on-demand applications with consultants that can help them address their global requirements, according to Bobby Napiltonia, senior vice president of worldwide channels and alliances at Salesforce.com. "The largest enterprise businesses worldwide are realizing they too can take part in on-demand success," he said in a written statement. "With Salesforce Winter '07 and the Apex on-demand platform, companies are able to extend the benefits of on-demand applications to any part of the enterprise."

"Salesforce.com's on-demand model can help change the way large organizations approach their customers," said Paul Clemmons, Deloitte Consulting principal and emerging solutions leader, in a written statement. "We look forward to working even more closely with Salesforce.com to help our clients in their efforts to realize significant results from their on demand applications. The Salesforce.com Apex on-demand platform represents an opportunity to expand the benefits of on-demand computing across many facets of an enterprise."

The announcement dovetails with the findings of a study unveiled today by Nucleus Research and KnowledgeStorm, a search resource for tech solutions and information. More than half of the 198 organizations surveyed use on-demand solutions, and nearly two-thirds plan on implementing an on-demand offering in the next year, according to the study. "This survey shows that the on-demand model is beginning to outgrow its image as a small business solution that, while cost-effective, couldn't scale reliably," Jeff Ramminger, executive vice president of KnowledgeStorm, said in a written statement. "Now, companies of all sizes can take advantage of the efficiencies of these types of solutions."

Salesforce.com has been trying to move up-market for a while, says Timothy Hickernell, associate senior analyst at Info-Tech Research Group. "At some point in this process, software vendors do need to have credible system integration partnerships to get their foot in the door of large firms. The key will be to see how many resources Deloitte--and other SIs--ultimately put towards this partnership, such as full-time consultants trained and certified on Salesforce.com's technology."

180 View – This article is interesting partly because of the statistics supporting the on demand model as well as Deloitte’s commitment to it. Another view is about lack of independence. Deloitte has other strategic relationships including with Cognos, Lawson, Microsoft, Oracle and SAP. Our perspective is that Deloitte (and the other firms like it that offer implementation services with specific systems) will be unable to provide independent consulting advice in business process improvement projects that potentially involve either replacement or upgrades.

Two new tools that CIOs want – Virtualization and Software as a Service

May 2006 from The McKinsey Quarterly – “While many promising new technologies vie for the attention of IT leaders and CIOs, only a few of these innovations actually end up improving top-line performance or bottom-line productivity. Our recent survey of senior US IT executives and our experience with clients suggest that companies view two new technologies as highly promising tools for obtaining real business benefits: server virtualization (which helps companies improve the match between their computing capacity and their application workloads, so that they can do more with fewer machines) and software as a service (which allows IT departments to offload the delivery and maintenance of software applications). Companies clearly view these technologies as priorities that promise to help them become more efficient and agile.

Virtualization is a software technology that helps raise the utilization rates of servers. It allows companies to run several different operating systems—UNIX, Linux, and Windows, for example, as well as the applications that run on top of them—on a single machine. Distributed servers running a single operating system typically utilize only about 5 to 15 percent of their full processing capacity. Virtualization can make it possible for companies to boost their average server utilization rates to 40 percent or higher while still meeting peak demand. IT departments can then consolidate their servers, reduce the complexity of their environments, and, over time, buy less hardware (though the servers they do buy may be higher-capacity boxes). Related technologies let a single application run across several machines, further boosting reliability and utilization rates, since a machine that isn't too busy can take some of the load off others that are. Finally, the flexibility to set up and tear down test environments quickly and to move applications across physical servers helps to increase administrative productivity and to reduce hardware outlays still further.

Most companies have already begun consolidating their servers—86 percent of the CIOs we asked cited progress in this area. Virtualization is the next natural move. Consolidation aims to combine multiple instances of identical or similar applications on fewer machines. Virtualization goes a step further by making it possible to run more applications on them and by increasing a company's flexibility, so that it can meet shifting workloads without excess hardware. One CIO with a budget of $600 million told us that his company has virtualized 30 percent of its servers and plans to have 60 percent of them virtualized within two or three years. He expects to reduce capital expenditures during the next server-refresh cycle by 30 percent and to reallocate the savings to different projects.

The other trend cited by the IT executives we surveyed is the delivery of software as a service over the Internet. Rather than purchasing and deploying applications inside the enterprise, many companies are buying access to externally hosted applications, so they pay for the software as they use it. The software-as-a-service model can cut the total cost of deploying some classes of enterprise applications by 30 to 40 percent as compared with the total cost of purchasing and maintaining them in house. Of the senior IT executives we talked with, 38 percent said that they plan to use the software-as-a-service approach during the next 12 months. Popular applications include business software for human-resource management (including payroll), billing and order entry, and sales management, as well as security services that guard against spam and viruses. The range of applications delivered in this mode continues to grow, though to date few companies are using software as a service in systems (such as those for production planning and forecasting) that need a lot of tailoring or customization.

Software as a service differs from the fad of the late 1990s for application service providers (ASPs) because the most successful companies offering this latest generation of hosted software have redesigned their applications for scalable delivery over the Web. In this way, these companies innovate more quickly and thus have lower total costs—and pass the benefits on to their customers. Contrary to some expectations, the acceptance of this model isn't limited to midsize companies with understaffed IT departments; some very large enterprises are among the earliest adopters.

IT executives are shifting to the software-as-a-service model for some applications not only for lower licensing and maintenance fees but also because implementation is usually quicker and companies don't have to maintain special skills in software-specific areas. Some enterprise applications can cost tens of millions of dollars and take 6 to 24 months to implement, and many executives prefer to outsource the task. Web services protocols—transport rules that make it easier to link applications flexibly—are helping to speed this migration: 60 percent of our survey respondents said they were implementing Web services, in some cases to integrate externally hosted applications into their own systems.

Taken together, these two adoption trends indicate that a technology architecture transformation is beginning to take shape in many large and midsize organizations. In the past, CIOs deployed their own self-contained application architectures on their own servers and storage systems. This old model is giving way to a hybrid application architecture that combines hosted functionality with in-house applications running on consolidated and virtualized commodity servers. We believe that this transformation will drive efficiencies across the full stack, from business processes to physical infrastructure, while increasing IT's ability to meet new demands in a rapidly changing business environment. Of course, technology alone won't deliver this vision: IT and business leaders will need to rethink governance models and management processes to take full advantage of new technology trends.”

180 View – This article was recommended to us by a company called FavorData
that builds custom systems. The article discusses two important IT trends - Virtualization and Software as a Service (SaaS). The article says that “few companies are using software as a service in systems that need a lot of tailoring or customization.” We think that we will see more customized SaaS solutions using Service-Oriented Architectures (SOA). SOA enables a network architect to mix and match existing elements (software, data, or processes) to create custom-made composites to better serve the business’s needs. SaaS using SOA - don’t you just love acronyms?

Are Background Checks Necessary For IT Workers?

January 29, 2007 from Information Week – “When UBS PaineWebber hired Roger Duronio as a full-time systems administrator in 1999, it didn't do a background check on him. An investigation likely would've turned up a police record that included burglary and aggravated assault convictions in the 1960s, drug charges in 1978 and 1980 for which he wasn't convicted, and a drunken driving case in the 1990s.

Those records were filed by the U.S. District Court in New Jersey's Probation Office ahead of last month's sentencing of Duronio, 63, convicted this summer of computer sabotage and securities fraud. In 2002, Duronio unleashed a "logic bomb" on UBS' computer systems that crashed 2,000 of the company's servers and left 17,000 brokers unable to make trades. It cost about $3.1 million to fix. UBS didn't disclose the damage from lost business.

Duronio's criminal past is the kind of information most employers need to know, especially if they're hiring someone who will have access to key systems and applications. Duronio was one of about 40 people with the company's highest computer security clearance, according to court documents, and he had root access to the system.

UBS PaineWebber, renamed UBS Wealth Management USA in 2003, did background checks on a selective basis in 1999, but not on Duronio when he went from being a contractor to a full-timer, a company spokeswoman says. Now the company checks all full-time, part-time and temporary workers, she says.

That's good policy. "You better consider how important IT is," says Alan Paller, director of research at the SANS Institute (www.sans.org). "Consider if you could keep on doing business if someone inside hit you with a logic bomb," he says. "If you can't, you should think about background checks."

Would a background check have turned up Duronio's record? At I&T sibling publication InformationWeek's request, investigation firm Fairfax Group found most of the information in the probation report within four days using only public records, and some within 24 hours. Such a search would cost about $500, or about $250 if the person provided a waiver and information such as a Social Security number, says Fairfax Group president Michael Hershman.

Thirty percent of insiders who launch system attacks have criminal records, says Dawn Cappelli, a senior member of Carnegie Mellon University's CERT security response team, citing a 2006 study. In that study, 73 percent of companies did background checks, compared with just 48 percent in the 2005 study.

Companies just starting to do checks on job candidates also should do checks on current employees, says Ken van Wyk of Alexandria, Va.-based information security consulting firm KRvW Associates. But be open about it, and make sure people understand why it's necessary, he says.

IT and HR managers also need to discuss beforehand what's acceptable past behavior and what isn't, says Howard Schmidt, a former White House security adviser who's now CEO of R&H Security Consulting. "If someone had a DUI 20 years ago, or they were arrested for marijuana in the '60s, you check the circumstances," Schmidt says. "Was it a drinking problem, or was it one night out celebrating a birthday? It's the repeating of a failure to comply with the rule of law that I would be looking for."
Schmidt warns that background checks are no guarantee. But in fighting insider threats, more companies are deciding they're worth the time and expense.

180 View - While insiders aren't the most common security problem, they can be among the most costly and the most damaging to a company's reputation. Insider attacks against IT infrastructure and data are among the security breaches most feared by both government and corporate security pros.

Lawrence Young (an associate of 180 Systems) has always done background checks on the people he employed in the past. Lawrence says that the degree of checking, including using a third party investigation agency, varies with the job the individual is being hired to perform. In fact, Lawrence made every employment offer conditional upon receiving a satisfactory background check, and advised the potential employee that he may use a third party investigation agency.

Investigation agencies typically provide written reports including details on an individual’s education, past employment, lifestyle habits, and encounters with ‘the law’ if any that would otherwise be difficult for the typical employer to gain access to.

Lawrence also strongly suggests that all system access be revoked immediately when an IT employee is terminated. While that may sound obvious, research shows that about half of all insider attacks take place between the time an IT employee is dismissed and his or her user privileges are taken away.

January 2007

Newsletters made easy

January 2006 from CAmagazine and written by Michael Burns – “Electronic newsletters are a great way to stay in touch with your customers, prospects and referrals. But there's a technology component that you need to master if you don’t have ready access to an IT department. Once you have the software and have set up the newsletter, it’s easy to change the content every month. Be careful, though: the newsletter should be sent only to those who want it. Otherwise you will be blacklisted by the spam fighters. You need to get permission and make it easy to opt out.

There are many ways to prepare and distribute a newsletter. Here, I will share with you some tricks of the trade. First, maintain a database of contacts in a customer relationship or contact management system. I use ACT! Version 8, which is fine but will require more computing power than previous versions. (I actually needed to upgrade my computer to accommodate Version 8.) CRM or contact management systems allow you not only to store contact information in the database, but also to manage it. You could use something more rudimentary but you will lose out on all the other advantages associated with contact or CRM systems.

Second, you have to develop content. For my monthly newsletter, I use articles I have either written or read. During the month, I save articles about technology, business processes and risk management that I think would be interesting to my contacts.

Third, you need to publish the newsletter. Many companies use Adobe Acrobat to generate a pdf file that can be read by their clients. Recipients of the newsletter just need Adobe Reader, which can be easily downloaded at no charge. Other companies publish their newsletters on the Internet using tools such as Microsoft FrontPage or Dreamweaver. In April 2006, I tried something new — a blog (short for weblog). One big advantage is that a blog is interactive: your readers can post comments. Another advantage: it could attract new prospects to your website. I use blogger.com, which was acquired by Google in 2003. It’s easy to update the blog. The only hard part is incorporating it with the rest of your website to give it the same look and feel. You will most likely need a firm that specializes in developing websites to accomplish this.

Last, you need to distribute the newsletter. There are plenty of alternatives. Your objective should be to personalize it and send it out in bulk (hundreds or thousands at a time). That eliminates Outlook. Many customer relationship management tools include marketing automation, which will allow you to do an e-mail blast. As ACT! does not include marketing automation, I chose GroupMail from Infacta, which works really well for me. I import contacts from ACT! and blast them out with GroupMail. With GroupMail, you can quickly and easily import contacts, send professional messages that are personalized for each of your recipients, and let it run while you are doing something else on your computer. There is a free version of GroupMail that allows you to send to a maximum of 100 users at a time.

My contacts are busy so I try to make it easy for them to scan for anything that might be interesting. I make the e-mail very brief, including only the headings for the articles. Readers can then click to access my blog for the details. The blog contains comments about the article and often my view or opinion. This gives some value added beyond the article itself. Readers can click again to see the whole article.

Free ERP

December 22, 2006 from E-Business News – “Sourceforge.net is a repository of free open source software, and a lot of it applies to e-business. We've compiled this list of free enterprise resource planning (ERP) products. One of them might be appropriate for your small business. Click on the product name to get more information and download links straight from Sourceforge.

Compiere: "Smart ERP+CRM solution for Small-Medium Enterprises in the global market covering all areas from order and customer/supplier management, supply chain to accounting. For $5-500M revenue companies looking for "brick and click" first tier functionality..."

180 View – There are 17 more “free” ERP systems discussed in the article. We especially liked the name of one of the systems called WyattERP. On a more serious note, the question is whether it makes sense to implement one of these systems. We believe that ERP systems are mission critical to any business and you don’t want to take any chances with relatively unknown developers or systems that may require a lot of fine-tuning to work for you. You may find that the cost of services (internal and external) makes these “free” systems more costly than the systems you can purchase/license or rent (via an Application Service Provider). However, we admit that we don’t have any personal experience with these systems, and that our fears may be exaggerated. If anyone has experience with one of these systems, we would love to hear from you. Please post a comment. Thanks

The Power of Process

December 18, 2006 from Business IT Alignment News and Analysis – “As of late, the IT industry has been peddling various solutions to understand, monitor or optimize that nebulous beast called “process.” So what is a process and why should every CIO be focused first and foremost on business process?

Most of us have seen the now overused IPO diagram: the three boxes arranged in a line, and connected by arrows like the boxcars in a train. The first box contains “Inputs,” which move into the next box titled “Process,” which subsequently flows into the final box, titled “Outputs.”

This diagram is a model of simplicity, yet exposes a flaw in current thinking. Two thirds of the diagram is concerned with inputs and outputs, placing priority on “stuff” rather than how we actually change one form of “stuff” to another. While a simplification that fits neatly into the world of flowcharts, in the real world we often focus too narrowly on moving and changing “stuff” versus why we are changing inputs to outputs, and determining how to efficiently and portably change that “stuff.”

Process is the “why” to any business problem. IT has embraced process more than most other business units, at least on a superficial level. We are familiar with how to diagram a process, and nearly all of the project methodologies provide a provision for capturing, diagramming and understanding the “as-is” process, or the current state of affairs, before we seek to intervene and bring about a new state of affairs.

We also have myriad tools at our disposal for improving a process, either by increasing its speed, efficiency, accuracy or repeatability, in the form of powerful technologies from ERP systems to entire process management toolkits and software.

What we often lack however, is the ability to separate content, the inputs and outputs, from the process itself, which has hampered the ability of IT to implement successful projects that deliver the business benefit they initially sought.

IT has been built around content, both in terms of hiring and developing its staff, and in how it approaches IT projects in cooperation with a business unit. We hire and evaluate people that are experts in a particular technology, which is just another content area. We then approach a particular business problem as an issue of content. Why are our competitors more efficient? It must be due to their ERP system. Why did a new entrant to a market outfox us? They must have better decision support systems, etc.

We see a business problem as one of bolting new technology onto existing processes, wrongly assuming that by changing the content of the process, the process will change as well. This can only be expected when we have built organizations around experts in a particular area of technical content, and business experts familiar with the rules and nuances (more content) of a process, experts in the "how" rather than the "why”…

180 View – IT does typically suggest new technology as the solution unless they have a vested interest in maintaining the status quo. It would be great if IT also considered business process improvement as a way to enhance efficiency or effectiveness. But let’s not forget about human resources (how do organizations structures, job definition, and skills impact the process?), policies and rules (such as the approval process), and facilities (workplace design, infrastructure, computers…).

Justice, SEC actions backpedal a bit on post-scandal rules

December 18, 2006 from Associated Press – “They were two early Christmas gifts for corporate America -- with potentially far-reaching effects for investors and the financial landscape. At the Justice Department and the Securities and Exchange Commission, separate actions last week both had the effect of easing landmark rules laid down in response to the 2002 crisis of corporate malfeasance.

Culminating an intense months long lobbying campaign by an array of companies, the five SEC commissioners voted at a public meeting Wednesday to propose a plan giving corporate managers more flexibility in assessing the strength of internal financial controls. It would especially benefit smaller companies.

The sweeping anti-fraud law known as Sarbanes-Oxley was enacted in 2002 amid the wave of scandals that engulfed Enron Corp., WorldCom Inc. and other big corporations. The law contains a key section requiring public companies to assess the strength of their internal safeguards to ensure that their financial statements are accurate. Companies have complained to the SEC that those rules are overly burdensome and costly, especially for smaller businesses…

Some business-friendly Democrats who are assuming power positions in January have expressed support for Sarbanes-Oxley relief for companies -- and their preference for the SEC to wield its regulatory scalpel as opposed to Congress' heavier hand of legislation.

The SEC move was a "reasonable approach" in light of the disproportionate burden of the financial-control rules on small companies, said James Cox, a professor at Duke University who also is a securities-law specialist.

Still, he said, with more leeway under the SEC plan -- allowing, for example, less stringent testing of internal controls for some companies, "Those (financial) numbers are going to be less trustworthy than they would be otherwise. ... Investor protection's going to suffer."

SEC officials insisted that would not happen. Agency Chairman Christopher Cox called the new plan "making Sarbanes-Oxley work for investors at the right price"…

180 View – We thought that the article was vague so we went to the source at http://www.sec.gov/rules/proposed/2006/33-8762.pdf released by the SEC on December 20, 2006.

“The proposed guidance is organized around two broad principles. The first principle is that management should evaluate the design of the controls that it has implemented to determine whether they adequately address the risk that a material misstatement in the financial statements would not be prevented or detected in a timely manner. The guidance describes a top-down, risk-based approach to this principle, including the role of entity-level controls in assessing financial reporting risks and the adequacy of controls. The proposed guidance promotes efficiency by allowing management to focus on those controls that are needed to adequately address the risk of a material misstatement in its financial statements. There is no requirement in our guidance to identify every control in a process or document the business processes impacting ICFR. Rather, under the approach described herein, management focuses its evaluation process and the documentation supporting the assessment on those controls that it believes adequately address the risk of a material misstatement in the financial statements. For example, if management determines that the risks for a particular financial reporting element are adequately addressed by an entity-level control, no further evaluation of other controls is required.

The second principle is that management’s evaluation of evidence about the operation of its controls should be based on its assessment of risk. The proposed guidance provides an approach for making risk-based judgments about the evidence needed for the evaluation. This allows management to align the nature and extent of its evaluation procedures with those areas of financial reporting that pose the greatest risks to reliable financial reporting (i.e., whether the financial statements are materially accurate). As a result, management may be able to use more efficient approaches to gathering evidence, such as self-assessments, in low-risk areas and perform more extensive testing in high-risk areas.

By following these two principles, we believe companies of all sizes and complexities will be able to implement our rules effectively and efficiently. As smaller public companies generally have less complex internal control systems than larger public companies, this top-down, risk-based approach should enable smaller public companies in particular to scale and tailor their evaluation methods and procedures to fit their own facts and circumstances. We encourage smaller public companies to take advantage of the flexibility and scalability of this approach to conduct an efficient evaluation of internal control over financial reporting. Further, we believe the proposed guidance will assist companies of all sizes in completing the annual evaluation of ICFR in an effective and efficient manner by addressing a number of the common areas of concern that have been identified over the past two years.”

Did Sarbox Make Companies Cleaner?

December 13, 2006 from CFO.com – “On the eve of a highly anticipated Securities and Exchange Commission meeting that could bring about looser regulations for small businesses that have yet to comply with the Sarbanes-Oxley Act, a new study credits the 2002 law with cleaning up larger companies' internal controls and reducing the number of errors in financial statements.

In fact, the Glass Lewis & Co. report — released on Tuesday — says the number of restatements by larger companies fell 26 percent during the first nine months of 2006. The report's authors attribute this decline to the most contentious provision of Sarbox, Section 404, which requires management to attest that their company has adequate internal controls.

180 View – That’s good news. But the question still remains whether the benefit exceeded the cost.

How Secure Is Your Wi-Fi Connection?

January 4, 2006 from New York Times – “Long-time readers know that I’m not exactly one of the privacy paranoid. I’ve accepted that we all live in thousands of databases. The state of New York knows where and when I drive, thanks to my E-ZPass (electronic toll-booth badge). Stop & Shop knows what I eat, thanks to my grocery discount card. Blockbuster knows what kinds of movies I watch. Verizon knows whom I call, MasterCard knows what I buy–it’s just hopeless.

Frankly, I consider the details of my life so boring to other people that I really couldn’t care less. I’ve got nothing to hide, so why not accept it?That attitude spilled over to a “From the Desk of David Pogue” e-column I wrote in 2004, in which I attempted to throw water on scare-tactic computer-magazine articles that said, in effect: “Ooooh! If you use your Wi-Fi laptop at public Internet hot spots, the bad guys will see everything you’re doing and rifle through your files!”I’m back again today to throw that water right back into my own face.

On this topic, my eyes have been opened.It came about like this: I recently filmed six episodes of a new TV series (”It’s All Geek to Me,” which airs in February on The Science Channel, Discovery HD and Discovery Europe). In one of them, I wanted to get to the bottom of this Wi-Fi snooping business. I wanted to see exactly what is, and is not, possible for the bad guys to intercept when you’re sitting there in Starbucks or the hotel lobby.I put a note up on my blog, seeking a guest who could appear on the show and show me the hacky ropes. I found John Baer, a technical consultant who seemed just right for the part.

We met (John, the camera crew and I) in a Manhattan Wi-Fi coffee shop. Turns out there was absolutely nothing to it. John sat a few feet away with his PowerBook; I fired up my Fujitsu laptop and began doing some e-mail and Web surfing. That’s all it took. He turned his laptop around to reveal all of this:

Every copy of every e-mail message I sent *and* received.
A list of the Web sites I visited.
Even, incredibly, the graphics that had appeared on the Web sites I had visited.
None of this took any particular effort, hacker skill or fancy software. Anyone could do it. You could do it. All John needed was a “packet sniffing” program; such software is free and widely available. (He used a Mac program called Eavesdrop.) It sniffs the airwaves and displays whatever data it finds being transmitted in the public hot spot. Now, the fact that it’s so easy to intercept your Internet signals in a public hot spot doesn’t mean that somebody is *doing* it. In fact, of course, most of the time, nobody is. Nonetheless, John’s little demonstration made clear that somebody *could* intercept your transmissions extremely easily.

So are you supposed to crawl into a hole, turn off your Wi-Fi, and go back to dial-up?Not exactly. You can take steps to protect yourself:

If you see the little padlock in the corner of your Web-browser window (or if the Web address begins with “https://” instead of “http://”), you’re connected to a secure Web site. Your transmissions are encrypted in both directions, so you have little to fear from casual packet sniffers. Banking and brokerage sites, for example, are protected in this way.
You can sign up for encrypted e-mail services or programs, too, if avoiding e-mail eavesdropping is that important to you.
You can connect to your company over a VPN (virtual private networking) connection, which encrypts *all* data to and from your laptop. This is something a network geek would have to set up for you.
Otherwise, you can just conduct your online transactions with the awareness that a stranger could be “overhearing” them. Wait to visit Web sites, or to send e-mail messages, of a delicate nature until you’re on a wired connection or a private wireless one.
Truth be known, since my eyes were opened, my Wi-Fi habits haven’t actually changed much. I still open the laptop in the hotel lobby, exchange e-mail with readers, editors and friends, and check a few news sites or blogs. None of it would really mean anything to an evil eavesdropper nearby. But at least I’m aware that I *could* be observed. And isn’t it always better to know than not to?

180 View – We have replicated the article in its entirety. We think that many people share the concern expressed in the article and this article is short, well-written and informative. The author, David Pogue, “writes a technology column that has appeared each Thursday in The Times since 2000. Each week, he also writes the Times e-mail column "From the Desk of David Pogue," creates a short, funny Web video for NYTimes.com, and posts entries to his Times blog. In his other life, David is an Emmy-winning correspondent for CBS News, a frequent contributor to NPR's "Morning Edition," creator of the Missing Manual series of computer books, and father of three.”

IT Security Survey

January 5, 2007 from Canadian Technology News – “More than 1,600 North American IT managers (including over 1,000 Americans and 550 Canadians) were asked to rate the importance of security against seven different security threats, including security policy user compliance, internal user malfeasance, generic external threats (like viruses), random attacks (like password crackers), targeted external attacks, and protection of the physical server room or data centre.

The results, which were calibrated from the respondents' ranking of certain kinds of threats as “very” or “extremely” important, showed that Americans' and Canadians' attitudes toward IT security seem virtually identical, never straying farther than a few percentage points' difference.

The No. 1 concern was generic external threats, with more than 70 per cent of both Canadian and American IT managers calling it “very” or “extremely” important. This didn't surprise Brian Bourne, president of security consulting firm CMS Consulting and a member of the steering committee of the Toronto Area Security Klatch, an IT security user group. “Everyone gets spam and viruses, and it's a very visible problem. Its impact on security is easy to understand. But what most people don't understand is that when you do security really well, nothing happens. It's hard to understand the value of nothing happening,” he said.

Bourne has found that companies tend to get worked up over spam and viruses because it has an easily identifiable impact on productivity. Said Bourne: “When it comes to a leakage of information, which could also obviously have an effect on productivity, they really don't seem to worry that much.”

They're not blind to the data-leakage problem -- the second-most feared security threat is random attacks, which 60 per cent of Canadian IT managers and 56 per cent of American IT managers rated as “very” or “extremely” important in the battle against IT breaches (the fear of targeted attacks came in second-to-last, with half of the American respondents, and just over half of the Canadians, saying it was “very” or “extremely” important). Bourne said that this concern isn't even close to the fever pitch it should be hitting, in spite of the threat's easy understandability: “password cracking is happening on a mass basis.” He estimated that issues like server vulnerability are resulting in even small businesses getting five to 20 attacks daily, while larger companies get many more.

180 View – We think that the survey asked the wrong people. The CEO and CFO will be a lot more concerned.

Is XML Past Its Prime?

December 20, 2006 from Enterprise Open Source Magazine – “Is XML overrated? This is a question not asked lightly. It is a heavy and bloated question, much like XML itself. XML has been around since 1997. It is document based and it is extremely verbose. It requires a higher payload across the network and cannot be natively used once it arrives. The XML payload must be consumed in some fashion. None of these activities attribute to the speed of an application…

XML still thrives on the strength of one key factor: its market penetration. As clunky and obtrusive as it may be, XML is still a highly-used standard for data interchange between disparate systems. Most application servers can accept XML and apply some layer of processing to the XML. EDI is a key driver to not only XML's perpetuation, but its very existence.

JSON ("JavaScript Object Notation") is a format that more and more languages are "learning" to consume. It is, as the name implies, a standard object notation. Logic can be created to consume and serialize this notation into language-specific native datatypes. The only limitation to this would be language-specific object instances which cannot be serialized and de-serialized. If more systems were to use JSON for data interchange, in lieu of XML, the payload would decrease and application performance would increase because the parsing of an XML document still outweighs the de-serialization of a JSON string.

Where does this leave the first question? Is XML overrated? There are compelling arguments on both sides of the aisle, but the answer lies in individual preference. If a developer is more comfortable with XML, it will be used. If they are more comfortable with an alternative data interchange format, that format of preference will be used.

Either way, XML will continue to exist; but its days may, indeed, be numbered.”

180 View – For some of our readers, this article will be too technical and they may be wondering why we included it. The reason is that XML is touted by many people as a panacea to solving integration issues and as the tool that will enable B2B eCommerce to become the way to exchange transactions between organizations. We too could be accused of hyping XML. This article shows the warts of XML, which we think are not fatal. By the way, XML stands for eXtensible Markup Language.

BitTorrent has become a behemoth, devouring more than a third of the Internet's bandwidth

November 4, 2006 from Livewire - “A file-sharing program called BitTorrent has become a behemoth, devouring more than a third of the Internet's bandwidth, and Hollywood's copyright cops are taking notice. For those who know where to look, there's a wealth of content, both legal -- such as hip-hop from the Beastie Boys and video game promos -- and illicit, including a wide range of TV shows, computer games and movies…

180 View – If you haven’t heard of BitTorrent, ask your kids, nieces, nephews… And there are other file sharing programs sucking up bandwidth. One reason this is important can be read in Deloitte & Touche's Technology Predictions for 2007. Their #2 prediction is “Internet Capacity Woes: Reaching the limits of cyberspace - The unrelenting growth in Internet traffic in 2007 may overwhelm the Internet's backbone; the terabit-cable pipes connecting continents will reach capacity and ISPs will not be prepared to pay for extra bandwidth because consumers will be unwilling to pay increased costs. The threat to available capacity will be driven by the number of Internet users continuing to grow, and the exponential increase in the transmission of video files.”

Hakia: A New Google?

January 3, 2007 from E-Business News – Google entrenched itself deeper in our lives in 2006, but the success of the world's most popular search engine is attracting early-stage competitors in the New Year. One of these competitors is Hakia, whose search engine I tested out recently.

The Hakia premise, summed up in a company blog entry by software developer Chris Gates, is that "We are just now entering the phase of search with engines that understand 'what you mean' not just what or how you say it." Gates is referring to search engines with semantic (context) over and above syntactic (contextless keywords) capabilities.

For example, Gates suggests typing in "what drug treats headache" into another search engine. I ran the search on Google and got the following hits:

Lower Cervical Bupivacaine Injection Treats Headache in the ED
IngentaConnect Dexamethasone/amitriptyline treats drug-induced ...
As you can see, it wasn't a helpful set of results. The tacit question behind my query (what can I take for my headache?) went completely unanswered, as Google relied on the syntactic recurrence of keywords rather than deducing my semantic meaning. As a result, I didn't get a single relevant hit.

I repeated the search on Hakia and, right at the top of the page, Hakia told me: "The following should help: By reducing the amount of prostaglandin available for synthesis, paracetamol helps relieve headache pain by reducing the dilation of the blood vessels that cause the pain." There was a link to a specific page about headache pain, as well as to a Hakia gallery of prescription drugs.

The hits that followed this helpful top-line explanation were much more relevant to the issue of headache pain than Google's hits. Hakia's hits told me more about aspirin, nurofen, barbiturates, and even techniques like "sleep, darkness, or a quiet room…"

180 View – Even though 180 Systems does not show up on top of Hakia for keyword searches such as “ERP comparison”, we can see that it does offer a good alternative to Google if you’re getting nowhere in your Google search.

Past News and Articles

2006 - Click here

2005 - Click here

2004 - Click here

2003 - Click here.

2002 - Click here.