Archive for December, 2008

Book review: The Numerati

I finished reading The Numerati last night and I thought I would share my thought on the book.

My Rating: 6 / 10

The book was informative and interesting and was written around the central theme of mathematically and statistically deriving meaning from various types of data. Some of the data presented in the book are currently available – at least to some companies – while other types of data are slowly being accumulated for future use.

The book is divided in 7 main sections, each briefly presented below. The fundamental objective for deriving predictive models is ultimately to offer us (consumers, patients, individuals) more of what we are looking for. Although this doesn’t sound good at first, the book demonstrates that this objective is not as bad as it sounds.

• As Internet users, we leave vast amounts of data behind as we browse web sites. Companies are heavily analyzing that data in order to develop predictive models for advertising, among other things. Their intend is to develop algorithms to present us with the right messages so we feel compelled to investigate further and potentially purchase.
• As shoppers we sometime un-knowingly share our purchasing preference when we use credit cards or reward cards. Ideally, companies want to understand consumer patterns and offer us items that fit well with our needs and interests.
• As voters, we are being segmented in various groups so political parties can target their messages to obtain our vote. The groups to which we belong aren’t always simple to determine and most people belong to more than one group. Based on that information, how do political parties take advantage of that information to craft the right message to get more votes.
• As bloggers, we may thing we are immune to profiling but this isn’t the case. Tools and algorithms are being developed to determine some key information about the bloggers. In addition to basic information such as age group and gender, companies are trying to analyze bloggers preferences for certain products, services, ideas and so on. Although this might be easy to determine in some specific cases, this is a challenging undertaking when the bloggers are not specifically blogging about those specific products or services.
• Terrorism is also an important area of interest. With events in the recent years, governments have a strong incentive to profile people and groups of people to assess if they are part of terrorist cells.
• As the population ages and the cost of health care greatly increases, companies are trying to build sophisticated databases of health related information and hopefully develop predictive models to help people self-diagnose their illness or better yet potentially anticipate certain diseases.
• Our love life is also being put under analysis. Companies are building algorithms in order to determine the compatibility of people in order to build the perfect couples.

Having worked for a company who heavily used raw data to develop predictive models for pharmaceutical companies, I did enjoy and relate to the content of the book. Each chapter presented a different perspective on the theme of obtaining, aggregating and deriving meaning out of data. In many cases, the results are impressive.

The book fell short of my expectations because it mostly focused on facts – what companies are doing today and in the near future – and much less at giving an overall perspective of the world once all that data becomes available and models are actively used. It might simply be because I understood too well the potential use of all that data.

If you want to understand practical applications of data mining, this book will meet your expectations.

Will the current economic landscape prevent the launch of new BI initiatives?

Timo Elliot asked an interesting question today. In his post, What Might Go Wrong in Business Intelligence in 2009? He points to a few interesting risks facing Business intelligence projects (People will try to do without BI, People will revert to hand-coding and excel macros, Organizations will implement standards, and Business units will find it easier than ever to implement their own solutions).

His post got me thinking. What risks are we going to face as we launch a new BI consulting practice in the current context? I would argue the following:

• For companies who have already launched a BI project, they may want to accelerate pace in order to get benefits sooner and use the intelligence to develop a solid competitive advantage. This is where the advantage of an Agile approach become interesting.
• For companies who were thinking of starting a BI initiative, they must be educated with regards to the benefits of a BI project. In the current context, nobody will want to initiate a 3 years and $2M project. Once again the Agile approach makes sense.
• Companies who are currently using excel macros may not be as bad since they understand the value of business intelligence but lack the right processes and tools. I would argue that those companies need to be presented with a cost-effective tool and process to obtain better insight. They need to be shown that the current process is not sustainable and error-prone.
• The forth risk needs to be addressed differently as the challenge is one of integration. It would be necessary to determine the quality of the current process and resulting information in order to propose once again a more sustainable and centralized solution.

Although it might sound simplistic, it seems to me that the current economic situation simply raises the bar on consulting firms and technology providers. We now have to clearly demonstrate our solutions are cost-effective and will add value in a shorter time frame. Very few people would debate the “added-value” part but the “cost-effective” and “shorter time frame” might be more of a challenge. This is an opportunity for the best companies to stand out of the crowds.

Change always brings opportunities for those who want to grow.

When it comes to people, is there a correlation between Trust and Money?

Do people become less trust worthy when we start paying them? Do we trust people more when they do something for free?

[Although I also wonder if we trust people more when we pay them a lot of money, I will keep this thought for another post]

This question about correlation between Trust and Money came to me this morning after a good night of sleep. I’m currently reading a couple of interesting books as I often do. One of them focuses on a better way of managing projects (Agile Project Management with Scrum) while the other is about Internet communities (Citizen Marketers: When People Are the Message). Both books are interesting in their own way – I’ll publish a short review once I’m done reading them.

The Agile software development approach suggests that development team self-organize in order to deliver quality software that adds value, on time. For most managers, this approach is counter-intuitive. If people self-organize, how will they actually deliver what we expect them to, let alone delivering value?

It dawned on me that there are many examples of self-organized groups of people that exceeded the expectations in the value they deliver. What would have happened if Jimmy Wales and Larry Sanger didn’t trust people when they launched their project for Nupedia? With over 11 million* articles in 236* languages, Wikipedia is a great example of self-organized people. And what about Trip Advisor with over 15 millions* travellers voluntarily contributing content in order to help fellow travellers. Not to mention the amazing collaboration between amateur photographeurs on istockphoto.

These are 3 simple examples of amazing results when people are trusted. So why do managers and their organizations still feel they must control their teams and the processes they use in order to obtain results? Why do they feel they need to implement strict processes and close monitoring instead of letting their team self-manage with an Agile approach?

It could be argued that the Internet communities presented above succeeded because they shared a common goal. Which leads me to ask, don’t we believe employees could share a common goal?

* At the time I wrote this post.

Book review: Outliers: The Story of Success

My Rating: 9/10

Outliers: The Story of Success is another good book from Malcolm Gladwell!

It is commonly believed that people become successful after “working hard” for a long time and then success happens! Although hard work is a success factor, there are many other variables that have much more influence on success. Gladwell presents real life stories and much background to demonstrate that success mostly come from factors such as: when someone is born, their “ethnicity”, their family heritage, their geographic location, and circumstances (i.e. luck). Some or all of these factors combined with hard work made individuals or groups of people highly successful. His examples are great and support his key message.

Although the book doesn’t tell what someone needs to do to become successful, it certainly shows that after the fact there are some obvious trends that explain why people were indeed successful.

How would you feel if your colleagues knew your salary?

I could pretend this is a fictitious situation and try to come up with a good story to demonstrate my point but this time, I don’t need to.

So this is a real story that happened to Maria [a fictitious name] a friend of mine. Maria joined a small (less than 100 employees) but well known company in Montreal. She was bringing a great deal of experience and specific expertise to the organization and as such negotiated what she believed to be a fair compensation (salary, bonus, vacation, medical plan, etc.). Although it took some back and forth, both Maria and her employer were happy they had reached an agreement. She joined the company 3 weeks after accepting the offer.

Within the first week, Maria quickly noticed that she was joining a tightly knit team. Most of her teammates had been working together for years and had gone through some challenging projects which led them to gel. People were nice to Maria but she sensed something was interfering.

A few weeks passed and Maria was quickly learning the basics of her job. She rapidly got up to speed but still had to learn the specifics of the new industry. She truly enjoyed her work even taking home some assignments so she could learn as quickly as possible.

Maria had gone out for lunch the a local restaurant with a colleague when she heard something that completely shocked her. The conversation went like this.

• “You might not know this but everyone on the team knows how much you are making” said Tina.
• “How is this possible?” asked Maria in a state of shock.
• “You know Peter, the senior analyst on our team?” asked Tina.
• “Yes, of course I know him. He’s really funny!” said Maria who’s brain was trying to make connections.
• “I don’t know how Peter found out but he knows that you are making more than everyone on the team and he told us all. We even know that you have a 15% bonus which is unusual for our level.” added Tina.

Maria has always been very polite so she moved on to another topic she told me but she still couldn’t make peace with what she had heard. Her productivity dropped radically on that afternoon as she was trying to figure out ho to deal with such an un-easy situation.

Yesterday when Maria called me I wondered how I would have reacted? Here’s how she decided to handle the situation.

She debated how she could deal with such a situation and in the end she decided to do nothing. Maria thought she could confront Peter to find out how he got the information or she could try to deny the details. Either ways, she felt this would cause more harm than good. She simply decided to show through her actions and contribution that she was worth every penny.

She also decided that if any of her colleague would complain about her salary, she would ask them to go see their manager and discuss their salary. She thought people shouldn’t be upset at her if she had negotiated her salary well.

I thought that was a clever approach – capitalize on your own ability, skills and expertise and use your performance to justify your compensation instead of trying to talk people into believing your value.