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Pixar Movie Management Magic

Posted on May 29, 2009  Comments (1)

image of Walle - PixarImage of Wall-e, from the Pixar film of the same name.

Pixar’s secrets on display in ‘Up’

“I think it comes down to two basic things: one is that we’re run by artists. … John Lasseter is a film director, as opposed to being from a business school or whatever. He has that side of him as well, but he’s always approaching these things as the same way we are.

“Second, we have some pretty great people that they’ve managed to collect here. This is our 10th film, and every film has just gotten better and better, whether that be in animation or special effects or lighting. And it just all comes together to make for some really fantastic stuff.”
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“One of the things that I really love about [Pixar] is that no matter what you do, if you’re a production assistant or a producer or a marketing executive or running the kitchen, everyone here thinks like filmmakers,”
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Like, I didn’t work on ‘WALL-E,’ but I feel like it’s mine, you know? And I want that to look great and be great. And then I want that bar to be higher and for us to be challenged.”

Pixar has done a great job of creating the right climate for the business they are in. They make movies and have been very consistently successful. Many of those strategies are useful concepts for everyone. Create a climate that promotes pride in work. Create a climate where everyone sees how they contribute to the end product. Hire people you trust and let them do their jobs. Seek continual improvement. Respect people. Customer Focus. Innovation (for example: Pixar Is Inventing New Math).

By the way, Steve Jobs, Apple co-founder, paid $5 million for Pixar and sold his share for $3,700 million of Disney stock (he is the largest shareholder of Disney – approximately 7%). Pixar Movies include: Toy Story, Monsters Inc. and The Incredibles.

Related: Tilting at Ludicrous CEO Pay 2008 – Better and Different – Innovation Examples

Google’s Innovative Use of Economics

Posted on May 24, 2009  Comments (0)

Secret of Googlenomics: Data-Fueled Recipe Brews Profitability

Google depends on economic principles to hone what has become the search engine of choice for more than 60 percent of all Internet surfers, and the company uses auction theory to grease the skids of its own operations. All these calculations require an army of math geeks, algorithms of Ramanujanian complexity, and a sales force more comfortable with whiteboard markers than fairway irons.
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Varian tried to understand the process better by applying game theory. “I think I was the first person to do that,” he says. After just a few weeks at Google, he went back to Schmidt. “It’s amazing!” Varian said. “You’ve managed to design an auction perfectly.” To Schmidt, who had been at Google barely a year, this was an incredible relief. “Remember, this was when the company had 200 employees and no cash,” he says. “All of a sudden we realized we were in the auction business.”
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Google even uses auctions for internal operations, like allocating servers among its various business units. Since moving a product’s storage and computation to a new data center is disruptive, engineers often put it off. “I suggested we run an auction similar to what the airlines do when they oversell a flight. They keep offering bigger vouchers until enough customers give up their seats,” Varian says. “In our case, we offer more machines in exchange for moving to new servers. One group might do it for 50 new ones, another for 100, and another won’t move unless we give them 300. So we give them to the lowest bidder—they get their extra capacity, and we get computation shifted to the new data center.”

Google continues to make bold moves putting faith in their ability to find innovative solutions that others reject as impossible. It is a challenging but interesting path to success, for them, at least.

Related: Google Should Stay True to Their Management Practices – Google’s Answer to Filling Jobs Is an Algorithm – The Google Way: Give Engineers Room – Google Website Optimizer – Google: Experiment Quickly and Often – posts on innovation in management

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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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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Zara Thrives by Ignoring Conventional Wisdom

Posted on February 18, 2009  Comments (0)

Zara Thrives by Breaking All the Rules

Many U.S. apparel retailers are choking on slow-moving inventories as consumers hold back on spending. But Spain’s Inditex, whose Zara chain pioneered cheap chic, is zipping ahead. The $13.8 billion company, which is closing in on Gap (GPS) for the title of world’s biggest clothing retailer, has nearly quadrupled sales, profits, and locations since 2000
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Wages are higher at Inditex—its factory workers in Spain make an average of $1,650 a month, vs. $206 in China’s Guandong Province. But the company saves time and money on shipping. Also, Inditex’s plants use just-in-time systems developed in cooperation with logistics experts from Toyota Motor (TM), which gives the company a level of control that would be impossible if it were entirely dependent on outsiders.

In addition, Inditex supplies every market from warehouses in Spain. Even so, it manages to get new merchandise to European stores within 24 hours, and, by flying goods via commercial airliners, to stores in the Americas and Asia in 48 hours or less.
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As a result, the chain doesn’t have to slash prices by 50%, as rivals often do, to move mass quantities of out-of-season stock. Since the chain is more attuned to the most current looks, it also can get away with charging more than, say, Gap. “If you produce what the street is already wearing, you minimize fashion risk,”
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For rivals hoping to mimic Inditex’s results, analyst Luca Solca of Sanford C. Bernstein has a bit of advice: Don’t follow the Zara pattern halfheartedly. “The Inditex way is an all-or-nothing proposition that has to be fully embraced to yield results.”

Very true. Processes work well within a system. You can’t copy from one system to another. You can learn about what has been successful and figure out how you can adapt to take advantage of the ideas within your systems.

Related: Lean IT Systems – Not ERP – Systemic Thinking – What Kind of Management Does This? – Making Suits in the USA – Curious Cat Management on Lean Thinking

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 →

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

Google Should Stay True to Their Management Practices

Posted on December 9, 2008  Comments (3)

I believe in Google’s past, present and future. They have shown a great ability to ignore the short term focus that dominates (and kills success) of so many companies today. I am happy to invest in Google for the long term.

This current reaction to the economic crisis, is one of many times Google can be seen to be making significant changes to adapt based on market conditions and the results of their experiments and experiences. Google’s management in general and the 3 leaders continue to practice a management style based on an engineering perspective while so many others practice the style Scott Adams has pilloried in the pointy haired boss.

The thought and execution of Page, Brin and Schmidt (and others: Marissa Mayer) is at a different level than that of most other executives. Skepticism is wise. But I believe Google continues to have exceptional execution and focus on long term innovation.

The biggest risk I see, for them, is they become too focused on the short term and lose their ability to take advantage of the great opportunities available by focusing on long term success. Google is in a position where they are not forced to abandon long term plans due to cash flow problems. The only decision for Google should be whether something makes long term sense or not. If they are recalibrating and deciding they were being too lax in certain areas (without long term justification) then I am fine with changes. If though they are reacting to short term market conditions that is a big mistake.

Google Gears Down for Tougher Times

He says the company is “not going to give” an engineer 20 people to work with on certain experimental projects anymore. “When the cycle comes back,” he says, “we will be able to fund his brilliant vision.”

Bad idea, short term thinking. Don’t drive business practices based on short term earning releases. If the idea is not worth 20 people long term fine, don’t do it. If it is, do it. The lack of cash that would force many companies to abandon promising efforts is not an issue for Google. They have plenty of cash and are generating much more every day.

To better predict revenue, the company implemented quotas for ad-sales representatives and tied the pay of more employees to performance

Bad idea; quotas are a sign of management abdicating responsibility. Quotas are destructive to success. Pay for performance focuses employees on meeting targets instead of the best interests of the company. Quotas are destructive to constancy of purpose.
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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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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

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

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

Engineering Innovation

Posted on June 3, 2008  Comments (0)

In the webcast Dean Kamen discusses his latest innovation: robotic arms for people (amazing stuff). Once again he is doing great stuff. It is great what engineers can do (many worked together to get the progress so far) when given the opportunity. We need many more such efforts.

The research was funded by DARPA. DARPA, for those that don’t know, also made reading this blog possible. They funded the development of the internet. I was giving a talk, while I was working for the Office of Secretary of Defense Quality Management Office, on Using Quality to Develop an Internet Resource (back before blogs, but after the web, in 1999). I was trimming things as I spoke and cut the tidbit about DARPA and the internet because I figured everyone already knew that (and I had to trim as I was speaking). In discussions afterwards I found many didn’t know DARPA’s involvement.

Related: Better and Different – Water and Electricity for All – Google Innovation

Dean Kamen Lends a Hand, or Two (August 2007):
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Toyota Execution Not Close to Being Copied

Posted on May 7, 2008  Comments (2)

The Open Secret of Success

Toyota’s innovations, by contrast, have [focused] on process rather than on product, on the factory floor rather than on the showroom. That has made those innovations hard to see. But it hasn’t made them any less powerful.

At the core of the company’s success is the Toyota Production System, which took shape in the years after the Second World War, when Japan was literally rebuilding itself, and capital and equipment were hard to come by. A Toyota engineer named Taiichi Ohno turned necessity into virtue, coming up with a system to get as much as possible out of every part, every machine, and every worker. The principles were simple, even obvious – do away with waste, have parts arrive precisely when workers need them, fix problems as soon as they arise. And they weren’t even entirely new – Ohno himself cited Henry Ford and American supermarkets as inspirations. But what Toyota has done, better than any other manufacturing company, is turn principle into practice. In some cases, it has done so with inventions, like the andon cord, which any worker can pull to stop the assembly line if he notices a problem, or kanban, a card system that allows workers to signal when new parts are needed.

Very true, except one thing. Toyota’s innovation is not limited to process and execution. Toyota’s long term vision results in very dramatic innovation (that granted is not getting the press today – check back in 20 years, I think you will be reading about it then). For some examples see: Toyota’s Partner Robot, Toyota as Homebuilder, Toyota Engineers a New Plant: the Living Kind and The Birth of Prius.

A company truly driven by a focus on continual improvement, respect for all employees and reasonable executive compensation might be a company serious about adopting Deming and Toyota management principles. It is hard for me to imagine such a situation that doesn’t truly seek, as the primary aim of the organization, to benefit many stakeholders (workers, owners, suppliers, customers…) not just executives (or just executives, board and owners…).

Related: Toyota Management Develops the New Camry – Better and Different – Deming and Toyota – Toyota Keeps Improving – More Positive Press for Toyota Management – Good Execution is Important

Inside Honda’s Brain

Posted on March 7, 2008  Comments (1)

Inside Honda’s brain by Alex Taylor III

why is Honda playing with robots? Or, for that matter, airplanes? Honda is building a factory in North Carolina to manufacture the Hondajet, a sporty twin-engine runabout that carries six passengers. Or solar energy? Honda has established a subsidiary to make and market thin-film solar-power cells. Or soybeans? Honda grows soybeans in Ohio so that it can fill up cargo containers being shipped back to Japan. The list goes on. All this sounds irrelevant to a company that built some 24 million engines last year and stuffed them into everything from cars to weed whackers.
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Since 2002 its revenues have grown nearly 40%, to $94.8 billion. Its operating profits, with margins ranging from 7.3% to 9.1%, are among the best in the industry.
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The wellspring of Honda’s creative juices is Honda R&D, a wholly owned subsidiary of Honda Motor. Based in Saitama, west of Tokyo, R&D engineers create every product that Honda makes – from lawn mowers to motorcycles and automobiles – and pursue projects like Asimo and Hondajet on the side. Defiantly individualistic, R&D insists on devising its own solutions and shuns outside alliances. On paper it reports to Honda Motor, but it is powerful enough to have produced every CEO since the company was founded in 1948.
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The engineer in Fukui [Honda's president and CEO] cannot help but be intrigued by what his former colleagues are up to, and his office is only a few steps away from Kato’s. But even with the CEO just down the hall, says Kato, “We want to look down the road. We do not want to be influenced by the business.”
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mistakes like the Insight are also the exception. R&D has provided Honda with a long list of engineering firsts that consumers liked, including the motorcycle airbag, the low-polluting four-stroke marine engine, and ultralow-emission cars.

Related: Toyota as Homebuilder – S&P 500 CEOs – More Engineering Graduates – More on Non-Auto Toyota – Asimo Robot, Running and Climbing Stairs – Applied Research – Google Engineering Energy

Car Powered Using Compressed Air

Posted on February 25, 2008  Comments (11)

car powered using compressed air

Jules Verne predicted cars would run on air. The Air Car is making that a reality. The car would be powered by compressed air. Certainly seem like an interesting idea. Air car ready for production:

Refueling is simple and will only take a few minutes. That is, if you live nearby a gas station with custom air compressor units. The cost of a fill up is approximately $2.00. If a driver doesn’t have access to a compressor station, they will be able to plug into the electrical grid and use the car’s built-in compressor to refill the tank in about 4 hours.

The car is said to have a driving range of 125 miles so by my calculation it would cost about 1.6 cents per mile. A car that gets 31 mpg would use 4 gallons to go 124 miles. At $3 a gallon for gas, the cost is $12 for fuel or about 9.7 cents per mile. I didn’t notice anything about maintenance costs. I don’t see any reason why the Air Car would cost more to maintain than a normal car. Five-seat concept car runs on air

An engineer has promised that within a year he will start selling a car that runs on compressed air, producing no emissions at all in town.
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Tata is the only big firm he’ll license to sell the car – and they are limited to India. For the rest of the world he hopes to persuade hundreds of investors to set up their own factories, making the car from 80% locally-sourced materials.
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“Imagine we will be able to save all those components traveling the world and all those transporters.” He wants each local factory to sell its own cars to cut out the middle man and he aims for 1% of global sales – about 680,000 per year. Terry Spall from the Institution of Mechanical Engineers says: “I really hope he succeeds. It is a really brave experiment in producing a sustainable car.”

Now does that sound like the Toyota Production System to you? It should. If I were an executive at Toyota I would sure examine this to see if it really is as promising as it looks. And if it is Toyota sure has plenty of cash and the management practice to make a very compelling case for allowing Toyota to produce this globally. The engineers desires closely match what Toyota has learned. Both seek to eliminate the waste of transportation (friction).

Related: Click Fraud = Friction for Google – Manufacturing Takes off in India – Electric Automobiles

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