Currently browsing the Innovation Category

Innovation is not a new idea (though the popular business press often seems to think it is). Deming on innovation.
Recommended posts: Better and Different - Innovation in Organizations - Managing Innovation - Reaction to Jeff Immelt - Ackoff, Idealized Design and Bell Labs - Six Keys to Disruptive Innovation
Articles by: Clayton Christensen and Gary Hamel


Building a Great Workforce

Posted on April 13, 2009  Comments (0)

How P&G Finds and Keeps a Prized Workforce by Roger O. Crockett

“We actually recruit for values,” says Chief Operating Officer Robert McDonald. “If you are not inspired to improve lives, this isn’t the company you want to work for.”
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The P&G strategy starts on college campuses. The Cincinnati company dispatches line managers rather than human resource staffers to do much of its recruiting.
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For the few who get hired, their work life becomes a career-long development process. At every level, P&G has a different “college” to train individuals, and every department has its own “university.” The general manager’s college, which McDonald leads, holds a week-long school term once a year when there are a handful of newly promoted managers. Further training—there are nearly 50 courses—helps managers with technical writing or financial analysis.

Career education takes place outside the classroom, too. P&G pushes every general manager to log at least one foreign assignment of three to five years. Even high-ranking employees visit the homes of consumers to watch how they cook, clean, and generally live, in a practice dubbed “live it, work it.” Managers also visit retail stores, occasionally even scanning and bagging items at checkout lanes, to learn more about customers.

Going to visit the gemba, the actual place is incredibly important, and far too often ignored by managers today.

The emphasis on life long learning (in practice, not just words) is also very wise. In my experience far to little emphasis is placed on continual improvement of what many companies will say is their most important asset: their people. If you don’t invest in education of your staff that is going to harm your long term success. The investment P&G makes shows a respect for people.

Related: Jeff Bezos Spends a Week Working in Amazon’s Kentucky Distribution Center – Workplace Management by Taiichi Ohno – Respect for People, Understanding Psychology – Ohno Circle
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Build Your Business Slowly and Without Huge Cash Requirements

Posted on April 12, 2009  Comments (0)

Get Rich Slow by Josh Quittner

At no other time in recent history has it been easier or cheaper to start a new kind of company… These are Web-based businesses that cost almost nothing to get off the ground
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The term ramen profitable was coined by Paul Graham, a Silicon Valley start-up investor, essayist and muse to LILO entrepreneurs. It means that your start-up is self-sustaining and can eke out enough profit to keep you alive on instant noodles while your business gains traction.

“At this point, it would be hard for companies to get any cheaper,” Graham said. Since everyone already has an Internet-connected computer, “it’s gotten to the point that you can’t detect the cost of a company when added to a person’s living expenses. A company is no more expensive than a hobby these days.”

I see a great deal of truth to this and it provides interesting opportunities. Including being able to build a business slowly while still working full time. I have written about Y-combinator previously they have helped make this model popular. And the services these companies make seem to me to often be much more refreshing than ideas so watered down they lose much passion (so common from so many companies). Though some large companies provide great web sites.

Related: Some Good IT Business Ideas – Find Joy and Success in Business – Our Policy is to Stick Our Heads in the Sand – Small Business Profit and Cash Flow

Knowledge, Imagination, Innovation and Risk

Posted on March 23, 2009  Comments (0)

A consumer can seldom say today what new product or new service would be desirable and useful to him three years from now, or a decade from now. New product and new types of service are generated, not by asking the consumer, but by knowledge, imagination, innovation, risk, trial and error on the part of the producer, backed by enough capital to develop the product or service and to stay in business during the lean months of introduction.

W. Edwards Deming
Page 182, Out of the Crisis
More of Deming on Innovation

Related: Innovation Thinking with Clayton Christensen – Engineering Innovation – Managing Innovation – Gary Hamel on Management Innovation

Applying Disruptive Thinking to the Healthcare Crisis

Posted on February 19, 2009  Comments (3)

The Innovator’s Prescription: A Disruptive Solution to the Healthcare Crisis

Christensen spies symptoms of such disruptions bubbling up in the healthcare industry, such as molecular diagnostics, imaging technologies and high bandwidth telecom, and business model innovations. Integrated health systems like Kaiser Permanente have a leg up in deploying and optimizing these disruptive technologies.

The push for widespread healthcare reform must come from employers, who in spite of their declared intent to cut healthcare costs also know “they profit when their employees are healthy and productive.” Affordable healthcare, he concludes, “doesn’t come by expecting high end, expensive institutions or expensive caregivers to become cheap, but by bringing technology to lower cost providers and venues of care, so they can become more capable.”

Clayton Christensen is the rare management thinker that I feel real provides profound insights into thinking about management. There are many other good management thinkers that offer valuable idea, just most of them (in my opinion) really are presenting material in ways that offer managers a good way to take action on all the long known good management ideas that we fail to adopt successful for decades.
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Newspaper Innovation In Kansas

Posted on January 29, 2009  Comments (1)

The newspaper industry is facing challenging times. One success story is the Lawrence Journal-World in Lawrence, Kansas. I first heard about their efforts years ago:

Watchful Eyes on Kansas Media Innovations, NPR, 2005

Many media companies hoped that convergence — combining television, print and online resources — would help them survive. Instead, many companies have lost money on online journalism. In Lawrence, Kan., Dolph Simons’ Journal-World newspaper has taken ambitious news-gathering approaches to local issues.

The Newspaper of the Future, by Timothy O’Brien, New York Times

Lawrencians buying tickets for University of Kansas football games can visit the same site, LJWorld.com, and find photographs offering sightlines from each of Memorial Stadium’s 50,000 seats. Law aficionados can find transcripts of locally significant court cases posted on the site and participate in live, online chats debating the pros or cons of some cases – sometimes with experts who are involved in the proceedings.

A related Web site, lawrence.com, is aimed at college readers. It allows visitors to download tunes from the Wakarusa Music Festival, find spirited reviews of local bars and restaurants and plunge into a vast trove of blogs
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The steward of this online smorgasbord is Dolph C. Simons Jr., a politically conservative, 75-year-old who corresponds via a vintage Royal typewriter and red grease pencil while eschewing e-mail and personal computers. “I don’t think of us as being in the newspaper business,” said Mr. Simons, the editor and publisher of The Journal-World and the chairman of the World Company, the newspaper’s parent. “Information is our business and we’re trying to provide information, in one form or another, however the consumer wants it and wherever the consumer wants it, in the most complete and useful way possible.”

The company has continued on an path of customer focus and innovation. There work shows what can be done by understanding what need you fulfill for customers.

They understand what they offer customers (and it isn’t just paper). They understand the technology related to their business (not the technology of their past methods of working but the technology possibilities related to serving their customers). They understand the realities of the marketplace. And they have divined a strategy based on this knowledge (they have innovated). And finally, the Lawrence Journal-World has maintained a constancy of purpose.

Related: Zipcar Innovation – Innovation Strategy – Information Technology and Business Process Support Continue reading →

Using Free Content to Boost Your Sales

Posted on January 23, 2009  Comments (0)

I am a big believer in marketing by providing some content for free. It is a great idea for consultants. It is also a great idea for those looking to sell books and audio-visual content.
Can Free Content Boost Your Sales? Yes, It Can

As those crazy Monty Python dudes put it, “We’re letting you see absolutely everything for free. So there! But we want something in return. None of your driveling, mindless comments. Instead, we want you to click on the links, buy our movies & TV shows and soften our pain and disgust at being ripped off all these years.”

And you know what? Despite the entertainment industry’s constant cries about how bad they’re doing, it works. As we wrote yesterday, Monty Python’s DVDs climbed to No. 2 on Amazon’s Movies & TV bestsellers list, with increased sales of 23,000 percent.

Similar approach worked for Nine Inch Nails and other artists. And yet, lately we hear more about various restrictions to free redistribution of copyrighted content than ever before.

If you are looking to create some business in the rough economy, try thinking creatively and expand your ideas of what is a good strategy for gaining customers. Providing sensible online resources is a far better strategy than hiring a bunch of lawyers to sue college students. I posted a link to Monty Pythons great explanation of what they were doing on one of my other blogs last November. Enjoy.

Related: Giving Away Your Service for Free on Weekends – Innovative Marketing Podcast – Seth Godin on Marketing and the Internet – Marketers Are Embracing Statistical Design of Experiments

Disruptive Innovation Example: Eliminate Your Phone Bill

Posted on January 9, 2009  Comments (0)

Clayton Christensen’s ideas on disruptive innovation are very powerful. I have written about Innovation Thinking with Clayton Christensen previously. Here is an example of such innovation. All you need is a broadband internet connection and you can Kiss your phone bill good-bye:

The Ooma service uses so-called Voice over Internet Protocol (or VOIP) technology to deliver calls to your existing phone using a broadband connection. Consumers need only to buy a $249 Ooma Hub (it was a hefty $399 when the service launched last year); all domestic calls are free. (Ooma charges a few pennies a minute for international calls to landlines and 20 to 30 cents a minute for overseas calls to mobile phones. Calls from Ooma box to Ooma box are free.)
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Replacing your phone service is, of course, just the start for Ooma. In some ways, calling is the Trojan horse to get the box in your house and then figure out other services to sell, like enhanced network security or kid-safe Web surfing.

I ordered mine from Amazon for $203 and have been using it for a month, it has been great. Relatively easy to setup (they had a pretty good customer survey and I recommended they use colored cables – they color cables in the drawings in the users guide but give you 3 white cable to use – they are different types of cables so it isn’t tough to figure out but that would make it a bit easier).

I have been using Vonage for awhile and it is ok, but I don’t see any reason to pay each month when Ooma doesn’t charge a monthly fee (even on the lowest option on Vonage the bill is over $22/month). When I tried to cancel Vonage they refuse to allow it through the web site. Then forced me through voice mail maze only to then say we only answer the phone for you between 9-5 EST on workdays (that is about 75% of the time they are unavailable). I called back a week later, when I got a chance and they forced me through 10 minutes of wasted time but at lest I was able to get it canceled – once they refused to allow cancellation over the web site I was worried the customer disservice would be greater than it was.

Related: Six Keys to Building New Markets by Unleashing Disruptive Innovation – Save Money on Food – The Innovators Solution by Clayton M. Christensen and Michael E. Raynor – Using Google to Eliminate IT Costs

Cutting Hours Instead of People

Posted on December 23, 2008  Comments (2)

When financial and economic realities reach the point that labor costs must be cut I believe a good option to consider is cutting hours (and pay) instead of people. Some people will have extreme hardship if the cut in hours and pay is significant, but once you get is a bad situation no answers are likely to be without problems. I would try to offer the cuts to those that want them first. I would likely take an unpaid sabbatical, if offered, and the organization was in financial trouble.

Another way of doing something similar is profit sharing (where costs go down when profits go down). You should be careful how such sharing is designed, it can create bad incentives if done incorrectly. Also by paying a portion of wages as bonuses that expense can be reduced when times are bad without layoffs.


The Rise of the Four-Day Work Week

Like many companies, Pella is looking to cut expenses because of the economic downturn. But instead of laying off more workers, the Iowa manufacturer of windows and doors is instituting a four-day workweek for about a third of its 3,900 employees. Chris Simpson, a senior vice-president at the company, acknowledges it’s an unconventional move… it doesn’t want to be caught short of experienced workers.
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According to the U.S. Bureau of Labor Statistics, the number of employees who normally work full-time but now clock fewer than 35 hours a week because of poor business conditions has climbed 72%, to 2.57 million in November 2008, from 1.49 million in November 2007.

Related: Bad Management Results in Layoffs – Some Firms Cut Costs Without Resorting to Layoffs – Operational Excellence – posts on respect for employees

Ford’s Camaçari Plant in Brazil

Posted on November 18, 2008  Comments (3)

photo of Fords' Camacari plant in Brazil

Brazil’s Camaçari plant is model for the future

This state-of-the-art manufacturing complex in the northeastern Brazilian state of Bahia is not only the centerpiece of Ford’s Brazilian turnaround plan, it is also one of the most advanced automobile plants in the world. It is more automated than many of Ford’s U.S. factories, and leaner and more flexible than any other Ford facility. It can produce five different vehicle platforms at the same time and on the same line.
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At Camaçari, more than two dozen suppliers operate right inside the Ford complex, in many cases producing components alongside Ford’s main production line. Having those supplier operations on-site allows Ford to take the concept of just-in-time manufacturing to a whole new level. Inventories are kept to a bare minimum, or dispensed with entirely. Components such as dashboard assemblies flow directly into the main Ford assembly line at the precise point and time they are needed.
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Unlike many U.S. auto plants, where workers’ responsibilities are strictly limited to specific job classifications, workers like Silva dos Santos are encouraged to learn as many different skills as possible.

Here is an interesting video on the plant. It is sad how poor management at GM, Ford and Chrysler has created such a bad situation for those working at those companies, their suppliers, the communities that support their production… GM and Ford had the advice they needed to succeed from Deming in the 1980′s but they chose to focus on the short term, large executive payments, accounting gimmicks instead of continual improvement…

They each have improved over the years, but the standard is not just improving but doing so effectively and enough and they failed at that. The UAW shares some responsibility for failing to successfully lead their workers to a promising future but management is much more responsible for the failure in my opinion (the video and article try to say Ford wants to be innovative in the USA but the UAW won’t let them). It is management’s jobs to focus the organization on cooperation and success for all stakeholders. When management is more concerned with getting themselves huge payoffs (from the pockets of the other stakeholders) and then try to blame one of those other stakeholders for fighting management is disingenuous. Executive’s contempt for other stakeholders leads to the other stakeholders feeling that they should be just as greedy as management.

Related: Ford’s Wrong Turn – Ford and Managing the Supplier Relationship – Global Manufacturing Data 2007 – Toyota’s New Texas Plant – Womack Podcast on GM – VW Phaeton Manufacturing plant
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Appropriate Management

Posted on October 25, 2008  Comments (3)

Low-Tech, High Impact Innovation

Adopting the perspective of “appropriate technology” is an excellent way to promote and increase innovation. Your solutions don’t have to be high tech, they just have to provide wide benefits – and taking this sometimes counterintuitive approach can be enlightening.

Great post. My father, Dr. William Hunter, did a great deal of work with appropriate technology (he was a chemical engineering, industrial engineering and statistics professor) and in management improvement.

Often the failure to adopt appropriate technology solutions results from a combination of 3 things:

  • Failing to understand the conditions where the solution will be applied. Failing to “go and see” in lean manufacturing terms.
  • Short term thinking, the failure to see the challenges in maintenance, is how short term thinking manifests itself with the inappropriate technology solutions often applied by those siting in Washington DC or Paris. The failure to consider maintenance is also very related to the first point. Appropriate technology solutions are often very simple, less sensitive (less moving parts to break, able to deal with dust, rain…) and more easily repairable (with tools, expertise and spare parts available at the location of use).
  • A desire to use the cool new gadget and ideas.

Thinking about why appropriate technology is so effective, but underutilized can help anyone improve the solutions they adopt. Thankfully the adoption of appropriate technology solutions has been increasing over the last few decades.

I would especially encourage people to stop looking for the newest management book and actually read and adopt and then re-read and… the excellent management books from the last 50 years. Stop chasing some new shiny thing and adopt solutions that are effective – even if they seem boring.
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Wind Power Provided Over 1% of Global Electricity in 2007

Posted on October 3, 2008  Comments (0)

graph of global installed wind power capacity

Data from World Wind Energy Association, for installed Mega Watts of global wind power capacity in 2007. 19,696 MW of capacity were added in 2007, bringing the total to 93,849 MW. Europe accounts for 61% of installed capacity, Germany accounts for 24% and the USA 18%.

Post from the Curious Cat Science and Engineering blog (more posts on energy and engineering). The graph shows the top 10 producers (with the exceptions of Denmark and Portugal) and includes Japan (which is 13th).

Related: USA Wind Power Installed Capacity 1981 to 2005 – Wind Power has the Potential to Produce 20% of Electricity by 2030 – Top 12 Manufacturing Countries in 2007

Does the Data Deluge Make the Scientific Method Obsolete?

Posted on September 29, 2008  Comments (6)

The End of Theory: The Data Deluge Makes the Scientific Method Obsolete by Chris Anderson

“All models are wrong, but some are useful.”

So proclaimed statistician George Box 30 years ago, and he was right. But what choice did we have? Only models, from cosmological equations to theories of human behavior, seemed to be able to consistently, if imperfectly, explain the world around us. Until now. Today companies like Google, which have grown up in an era of massively abundant data, don’t have to settle for wrong models. Indeed, they don’t have to settle for models at all.
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Speaking at the O’Reilly Emerging Technology Conference this past March, Peter Norvig, Google’s research director, offered an update to George Box’s maxim: “All models are wrong, and increasingly you can succeed without them.”
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There is now a better way. Petabytes allow us to say: “Correlation is enough.” We can stop looking for models. We can analyze the data without hypotheses about what it might show. We can throw the numbers into the biggest computing clusters the world has ever seen and let statistical algorithms find patterns where science cannot.

see update, below. Norvig was misquoted, he agrees with Box’s maxim

I must say I am not at all convinced that a new method without theory ready to supplant the existing scientific method. Now I can’t find peter Norvig’s exact words online (come on Google – organize all the world’s information for me please). If he said that using massive stores of data to make discoveries in new ways radically changing how we can learn and create useful systems, that I believe. I do enjoy the idea of trying radical new ways of viewing what is possible.

Practice Makes Perfect: How Billions of Examples Lead to Better Models (summary of his talk on the conference web site):

In this talk we will see that a computer might not learn in the same way that a person does, but it can use massive amounts of data to perform selected tasks very well. We will see that a computer can correct spelling mistakes, translate from Arabic to English, and recognize celebrity faces about as well as an average human—and can do it all by learning from examples rather than by relying on programming.

Related: Will the Data Deluge Makes the Scientific Method Obsolete? – Pragmatism and Management Knowledge – Data Based Decision Making at Google – Seeing Patterns Where None Exists – Manage what you can’t measure – Data Based Blathering – Understanding Data – Webcast on Google Innovation
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The Ergonomics of Innovation

Posted on September 22, 2008  Comments (0)

The Ergonomics of Innovation by Hayagreeva Rao and Robert Sutton

the IHI case teaches us that innovations spread quickly when organizations focus relentlessly on selecting and spreading ideas in ways that ease the burden of thought and action for everyone involved. This mind-set differs from the one that burdens most organizations, where innovation
is seen as difficult, expensive, and protracted. The IHI staff’s ergonomics-of-innovation mind-set focused on making things easier and cheaper for everyone, including the staff itself.
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IHI focused on small things that had a big impact without placing a big load on hospital staffs (reducing the number of infections, for example, hinged on frequent and thorough hand washing). In this way, the organization adopted what Karl Weick calls a “small wins” strategy.
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Berwick and his team believed that simply asking hospital staffs to “try harder” to save lives wasn’t enough; people need concrete, easily learned and implemented tools.

Related: Saving Lives: US Health Care Improvement – 5 Million Lives Campaign – PBS Documentary: Improving Hospitals – Hospital Reform – IHI on CBS – Articles on Improving Health Care Performance – Drug Prices in the USA – posts on innovation

Seth Godin: Intern Program and the Internet

Posted on September 3, 2008  Comments (0)

Learning from a summer intern program:

I was overwhelmed by the quality of what I got back. (The quantity was expected… interesting internships are hard to find). I heard from students on most continents, with a huge variety of backgrounds and life experiences. And these people were smart.

Unable to just pick a PDF or two, I invited the applicants to join a Facebook group I had set up. Then I let them meet each other and hang out online. It was absolutely fascinating. Within a day, the group had divided into four camps:
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* The leaders. A few started conversations, directed initiatives and got to work.
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If you’re hiring for people to work online, I can’t imagine not screening people in this way. This is the work, and you can watch people do it for real before you hire them.

Excellent post and the advice echoes his advice on hiring: the End of the Job Interview. We have an internship directory, that helps people find opportunities (and those with internships to offer a way to market it) which includes a list of virtual internships.

Related: Seth Godin on Marketing and the Internet – Internships Increasing – Curious Cat Management SubReddit

Future Directions for Agile Management

Posted on August 25, 2008  Comments (4)

Agile management (agile software development specifically) is something that makes a big difference in my work life. David Anderson consistently provides great ideas on agile management and he does so again in this 90 minute presentation on the future directions for agile. As I learned about agile software development, what I saw was a great implementation of management improvement practices focused on software development that was very compatible with Deming’s management philosophy and lean thinking practices. The Agile manifesto:

Individuals and interactions over processes and tools
Working software over comprehensive documentation
Customer collaboration over contract negotiation
Responding to change over following a plan

The first line can seem to be at odds, but I think in practice it is not – though I admit it may seem that way based on the importance placed on process by Deming (I think you have to read on agile to understand why this is the case). For my use of agile software develop, a highlight of the most important ideas is:

  • Deliver working systems quickly (with limited features, add features based on user needs) – [management improvement practice: PDSA, pilot ideas on a small scale, go to the gemba (don't sit in conference rooms talking about what might be an issue for the computer application you want to see in 6 months, create working systems and then continually improve it)]
  • Build systems that cope well with uncertainty and allow for constant continuous improvement of processes (with IT systems that can adjust as needed to changing business conditions and desires) – [continual improvement - what is good enough today is not good enough next year]

Important concepts addressed by agile management: highly collaborative, risk tolerance, systems thinking, customer interaction, craftsmanship ethic [joy in work], eliminate waste. Great quote from the webcast:

What we know about knowledge work, and software engineering, is that coordination cost grow non-linearly with batch size. We’ve known this since Greg Brooks published the Mythical Man Month, probably longer than that. So that is a key difference with manufacturing, coordination costs do not grow with batch size in manufacturing.

Related: Kanban In Software Engineering – Management Science for Software Engineering – Improving Communication – webcast of David Anderson talking about applying Agile and Deming’s ideas at Microsoft – What is Agile Software Development?

Toyota Winglet – Personal Transportation Assistance

Posted on August 10, 2008  Comments (0)

Winglet Personal Mobility Device from Toyota

Toyota has a long term vision. The population of Japan is aging rapidly. Toyota has invested in personal transportation and personal robotic assistance for quite some time. I must admit this new Winglet doesn’t seem like an incredible breakthrough to me (their earlier iUnit seems much better to me – though I am sure much more expensive too). The interest to me is in their continued focus on this market which I think is a smart move. The aging population worldwide (and others) will benefit greatly from improved personal mechanical assistance.

The Winglet is one of Toyota’s people-assisting Toyota Partner Robots. Designed to contribute to society by helping people enjoy a safe and fully mobile life, the Winglet is a compact (you stand just above the wheels and it reaches about the level of your knees) next-generation everyday transport tool that offers advanced ease of use and expands the user’s range of mobility.

The Winglet consists of a body that houses an electric motor, two wheels and internal sensors that constantly monitor the user’s position and make adjustments in power to ensure stability. Meanwhile, a unique parallel link mechanism allows the rider to go forward, backward and turn simply by shifting body weight, making the vehicle safe and useful even in tight spaces or crowded environments.

Toyota plans various technical and consumer trials to gain feedback during the Winglet’s lead-up to practical use. Practical tests of its utility as a mobility tool are planned to begin in Autumn 2008 at Central Japan International Airport (Centrair) near Nagoya, and Laguna Gamagori, a seaside marine resort complex in Aichi Prefecture. Testing of its usefulness in crowded and other conditions, and how non-users react to the device, is to be carried out in 2009 at the Tressa Yokohama shopping complex in Yokohama City.

Toyota is pursuing sustainability in research and development, manufacturing and social contribution as part of its concept to realize “sustainability in three areas” and to help contribute to the health and comfort of future society. Toyota Partner Robot development is being carried out with this in mind and applies Toyota’s approach to monozukuri (“making things”), which includes its mobility, production and other technologies.

Toyota aims to realize the practical use of Toyota Partner Robots in the early 2010s.

On a personal note, I bought some more Toyota stock two weeks ago. The stock had declined a bit recently. Toyota is one of the companies in my 12 stocks for 10 years portfolio.

Related: Toyota Develops Personal Transport Assistance Robot ‘Winglet’ – No Excessive Senior Executive Pay at Toyota – More on Non-Auto Toyota

Amazon S3 Failure Analysis

Posted on July 26, 2008  Comments (0)

Amazon Simple Storage Service (S3) is a service providing web hosting. The cloud computing solution has been used by many organizations successfully. However the solution has experienced some problems including failing for much of the day on July 20th.

Amazon S3 Availability Event

We’ve now determined that message corruption was the cause of the server-to-server communication problems. More specifically, we found that there were a handful of messages on Sunday morning that had a single bit corrupted such that the message was still intelligible, but the system state information was incorrect. We use MD5 checksums throughout the system, for example, to prevent, detect, and recover from corruption that can occur during receipt, storage, and retrieval of customers’ objects. However, we didn’t have the same protection in place to detect whether this particular internal state information had been corrupted. As a result, when the corruption occurred, we didn’t detect it and it spread throughout the system causing the symptoms described above. We hadn’t encountered server-to-server communication issues of this scale before and, as a result, it took some time during the event to diagnose and recover from it.

During our post-mortem analysis we’ve spent quite a bit of time evaluating what happened, how quickly we were able to respond and recover, and what we could do to prevent other unusual circumstances like this from having system-wide impacts. Here are the actions that we’re taking: (a) we’ve deployed several changes to Amazon S3 that significantly reduce the amount of time required to completely restore system-wide state and restart customer request processing; (b) we’ve deployed a change to how Amazon S3 gossips about failed servers that reduces the amount of gossip and helps prevent the behavior we experienced on Sunday; (c) we’ve added additional monitoring and alarming of gossip rates and failures; and, (d) we’re adding checksums to proactively detect corruption of system state messages so we can log any such messages and then reject them.

Finally, we want you to know that we are passionate about providing the best storage service at the best price so that you can spend more time thinking about your business rather than having to focus on building scalable, reliable infrastructure. Though we’re proud of our operational performance in operating Amazon S3 for almost 2.5 years, we know that any downtime is unacceptable and we won’t be satisfied until performance is statistically indistinguishable from perfect.

The failure was significant but in my view the advantages of Amazon S3 are still very significant. A huge advantage is how quickly you can scale if needed be. If your application is not hosted on Amazon S3 and it grows enormously you have to physically deal with buying servers, installing them, installing software… All this takes time. On Amazon S3 when you need the bandwidth you can get it, when you don’t need it you don’t have it sitting around unused. In that way it is very lean, it seems to me.

And while server infrastructure failures are bad, for most organizations the option is not Amazon S3 or some solution that is 100% reliable. Currently it is difficult to keep IT infrastructures online and operating and coping with shifting demand… For many situations Amazon S3 seems to be a great resource. They need to keep improving; and they seem to be doing so. Being open and honest about the challenges is a good sign. And improving the system, not blaming a person is another good sign.

Related: Bezos on the Internet Boom – Amazon’s Amazing Achievement – Bezos on Lean Thinking – CERN Pressure Test Failure – 12 Stocks for 10 Years Update (June 2008), Amazon is up 116% in the portfolio since 2005, just behind Google and ahead of Petro China

Some Good IT Business Ideas

Posted on July 22, 2008  Comments (1)

Paul Graham has some excellent ideas. I have written about some of them previously: Innovation Strategy, What Business Can Learn from Open Source and Google and Paul Graham’s Latest Essay. Y Combinator, which he founded, provides seed funding. Here are some ideas they would like to fund:

Outsourced IT. In most companies the IT department is an expensive bottleneck. Getting them to make you a simple web form could take months. Enter Wufoo. Now if the marketing department wants to put a form on the web, they can do it themselves in 5 minutes. You can take practically anything users still depend on IT departments for and base a startup on it, and you will have the enormous force of their present dissatisfaction pushing you forward.
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Online learning. US schools are often bad. A lot of parents realize it, and would be interested in ways for their kids to learn more. Till recently, schools, like newspapers, had geographical monopolies. But the web changes that. How can you teach kids now that you can reach them through the web? The possible answers are a lot more interesting than just putting books online.
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Off the shelf security. Services like ADT charge a fortune. Now that houses and their owners are both connected to networks practically all the time, a startup could stitch together alternatives out of cheap, existing hardware and services.

Related: Our Policy is to Stick Our Heads in the Sand – Find Joy and Success in Business – Innovative Thinking from Clayton Christensen

Google Knows it is a 2.0 World

Posted on June 27, 2008  Comments (1)

You can accomplish a great deal by just talking to people. Google Public Relations:

I did not really expect it, but the next day I got a call from Jeffrey Korn at Google California. He explained that he was the one responsible for building the Google Bookmarks and Google Web History tools. The problem with my extension was something I hadn’t imagined: a scaling problem. Hehe, Google had scaling problems :-) .

The gBrain extension creates a lot of bookmarks. Several thousands a month. And the Google bookmarks system was never made with this amount in mind. What made things worse (and I didn’t knew that), the bookmarks are connected to the normal web search. Whenever you use the web search, it checks it against your Google bookmarks. You can easily imagine what problems can come up when you have a several 10 or even 100 thousands of bookmarks…

Jeffery also made a few suggestions how the extension could be changed to make use of their Web history service instead of the bookmarks system. This would avoid the scaling problems. I may consider it some day.

But why am I telling this? Because I’m amazed how Google handled this. Instead of just blocking my extension at their side, or sending me a cease and desist letter they contacted me and asked.

Good for Google. I do find it a bit funny they had a lawyer contact the guy but still Google’s reaction was much better than most companies would be. Companies like Google, Amazon, Lego, New York Times are taking advantage of technology to leverage community efforts to improve the value of their service to customers. This is an important innovation management needs to acknowledge and manage. Or you can be like the poorly managed journal publishers or music industry that are destroying their organizations futures.

Related: Funding Google Gadget Development – Innovative Marketing Podcast (Lego) – Innovation at Google

Zipcar Innovation

Posted on June 21, 2008  Comments (2)

map of zip cars near the White House

Zipcar is an intriguing idea where you rent cars by the hour. The whole process is a significant change from the previous rental model (gas, parking and insurance included). Zipcar makes deals with local governments to secure zipcar parking near public transportation. They also have deals with universities, apartment buildings and businesses all of which provides a new level of easy customer access with cars available in many locations. The internet is used to schedule and provide up to date information. It is a great idea for those in cities where you can design your life so a car is rarely needed. But having access to a car in those times can be very convenient.

The images show zipcars available near the White House in Washington DC. The White House is in the middle of the bottom of the image (Lafayette Square is immediately north of the White House).

The rates are not cheap when you look at per hour costs. But when you look at replacing the need for a car the savings can be large (if you do not drive too much). And for those that doing without a car is not realistic zipcar can be used for any needs for a second car. It is still a pretty large change in mindset. To try and help people give the idea a try Zipcar is trying the Zipcar Low-Car Diet challenge.

You agree to keep your car keys in your junk drawer for just one month, from July 21st through August 15th. In return, you get a loaded public transit pass, a free 1-year Zipcar membership, some driving time and more goodies that we’ll tell you about a little later.

During the month, we’ll ask that you check in and let us know how your diet’s going. You can send us emails, even video clips, to share your thoughts and stories. We’ll post excerpts on our website to help keep everyone motivated!

Related: Traffic Congestion Non-Solution – Airfare Innovation Example – Urban Planning – Deming on Innovation Continue reading →

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