deal architect

The year that was – and the one that will be

On New Florence been running the best of 2012

• Best 2012 photos
• Discover Magazine - Top 2012 Science Stories
• The Culture Street Journal - WSJ on best of 2012 art, architecture
• Scientific American’s 2012 “Game changers”
• Fortune’s Top Businesspersons of 2012
• Popular Science Best of 2012
• Time’s Gallery of 100 objects from 2012 Presidential Campaign

and what to expect in 2013

• New Scientist - ten big ideas for 2013
• Discover Magazine - 2013 calendar
• The Electronic Home in 2013
• InformationWeek IT Outlook 2013
• Travel and Leisure’s 2013 Travel  Trends

Tough Love for Southwest Airlines

I sent Gary Kelly and Herb Kelleher of Southwest the letter below on December 9.  Within a week, I  started getting calls from their reps. I finally caught up with Tim last week and notes from those conversation are in italics

“I am pleased I qualified once again for the Companion Pass and the A List. I have enjoyed your airline for decades, am a shareholder, and have written nicely about you in my books and blogs, so hope you will take some constructive criticism in a few areas

a) I absolutely love the 800s and the new décor. Having said that I dread the redone 700s. By adding another row you have deprived my 6 2 foot frame and my laptop of previous 2-3 inches of space. Increase our fares 4% (to gain the same economic benefit of 6 seats more from previous 137) but take that extra row out. While you are at it, also increase the restroom space by a few inches. The new ones are not comfortable.

No immediate plans to reverse course on the additional row on the 700s

b) The Row 44 wi-fi service is a disgrace to your image. I have tried and tried – probably spent $ 200 over last couple of years, and not once have I had to work well all flight. Or I have paid and find the connecting flight does not have the service. I cannot believe you are offering movies and sports channels to tax that bandwidth even more. The GoGo air to ground service that your competition (and AirTran) uses may not suit your plans for over water expansion to San Juan etc but the majority of your service is in the Continental US. The air to satellite concept is not working out. You have given it 3+ years. Get Row 44 to work a deal with GoGo or another ground based service. Your poor crew is always having to make excuses. It’s sad to see.

“The Row44 service keeps improving. Very few of our customers complain.” To my point that on not one of the 40+ times I have paid for the service has it worked all flight long, he offered a $ 200 credit. He also clarified the TV channel does not burden the wi-fi channel. He did not know how that bandwidth could deliver jitter free service, whereas the wi-fi service was so spotty. He did not know how the service compared to GoGo on AirTran, a company Southwest acquired. He also could not accommodate my request to get operational performance and service level information.  I told him after 3 years, scripted language was not going to please many customers. Southwest needs to provide more transparent wi-fi performance data.

c) I realize you are expanding routes faster than your fleet is growing, but one reason I moved my domestic business from Delta (where I am a 3 million miler) to Southwest is the breadth of your nonstops. Not having to go through Atlanta has been a joy. But in the last quarter I have seen nonstops to Phoenix and Las Vegas (and other points West) shrink. I also dread with your Atlanta hub growing you will become like Delta at least for your FL, AL and other Southeast customers.

“It’s true we are not expanding our fleet. Newer 800s are replacing older 300s which are being  retired. However, Southwest is not moving to a hub and spoke model, and AirTran may also move away from the dominant Atlanta hub model.”

d) Finally, this may be a nit, but both you and Delta use similar Tibco events processing technology. With Delta, with “wheels up”, your FF miles are credited. In your case, you have to wait for a day or two after the return flight is completed. For an airline which has long endorsed one way fares, I have to ask – what are you protecting against?

The new Southwest program credits are based on ticket value, whereas Delta’s are based on miles flown. Due to revenue accounting reasons, the Southwest credits will likely never be as instant as Delta’s.

Thanks again for a relationship, I hope continues to prosper, in spite of my moaning above.

Happy Holidays!!”

I thanked Tim for the $ 200 credit, but told him because of a) and b) and fewer nonstops from Tampa I was likely to move 20% of my business away from Southwest in 2013 and may be even more in future years. This was especially true on long flights where wi-fi and leg space are much more important. He said he was sorry to hear that, and I told him I never thought Southwest would allow other airlines a chance to open the door again for my domestic travel budget, but they have.

Two nations separated by a common language

This time of the year brings even more memories of the UK. I met Margaret during a posting in London in 1989. We go back often and Margaret took Tommy to the London Olympics and to Cambridge and Oxford this summer. We still get plenty of holiday cards from friends there and Margaret is very good about calling her cousins and friends for long holiday chats.

This year though I have noticed even more how the US and the UK keep drifting apart.

• It is one of the few years where we have had both Thanksgiving and Christmas at home, and I noticed our Christmas dinner was a bit more elaborate than our Thanksgiving dinner. Margaret’s Irish/English upbringing at play where the Christmas turkey is the most important meal of the year.
• I watch BBC and notice Boxing Day is still the most important shopping day in the UK. We have moved to Black Friday, Cyber Monday and who knows what else as days to splurge.
• I watch CNN and notice how incensed Piers Morgan is on the gun control issue. Many Americans want to deport him, not realizing that most other Brits would bring a similar sense of pride at how their tighter gun controls work and ours do not.
• I watch the movie Love Actually, a family favorite this time of the year and watch Hugh Grant as British Prime Minister stand up to a bully of Billy Bob Thornton as US President (a superbly lecherous cameo role).

Yes, the two countries still have a “special relationship” but we have been drifting apart for a while, and will drift apart more so as the US looks more West to the Pacific in the next few decades.

Through it all we still enjoy all the holiday cards, visits to London, and am particularly proud our kids have spent more time in the UK and Ireland than any other part of the world.

More New Renaissance

On the innovation blog

The technology skills shortfall

Earth as art

Eco-warriors

Santa’s sleigh

Simulate controllers at London airports

For your car’s midlife crisis

Megapixel surveillance

Energy efficiency apps marketplace

Call me Ishmael

My friend Michael Krigsman has been running a series on "Industry Influencers".

Personally, I cringe when I hear the term – I know it sounds ungrateful since many include me in the lists of influencers they compile.

Trust me, I would have been detained at the front door of most of the 50 countries I have been lucky to visit, if I had used that moniker. Author works well, much better than Consultant which I used for a while even when I was an Analyst.

My clients at Gartner and since, who I have helped review over $ 10 billion in technology contracts over the last two decades, have never called me “influencer”.  Adviser they called me. Motherxxxxxx was the most polite term the vendors  on the other side used for me.

My blog and book readers and speaking audiences consider me a “friend”. It is a modern day author’s blessing to get instant readership, blog comments, Amazon reviews and a frequent chance to shake hands. Guess how long it took Hemingway to get reader feedback or how few he actually shared a drink with (ok,  he probably made up for it with his stint in Key West)?

Ideally, I would walk around quipping the most awesome opening line in any written book.  That from Moby Dick: “Call me Ishmael”. What a calling card,  evokes as it does a Biblical and a sailors’ sense of wandering and exploring (and yes, a certain melancholy and loneliness)

I suspect the name would not allow for easy entry into many countries, so my favorite moniker these days in “Innovation Historian”. Not so much Edison or Tesla – even though I paid quiet homage to Edison’s original desk when I visited the GE facility in Niskayuna where it is lovingly preserved. Or those from Florence during the Renaissance during the 1400s and 1500s even though my blog is named after them.

It is modern day innovators who allow me to catalog the history they are crafting before our eyes.  Like Jeff Immelt, CEO of GE with his vision of the Industrial Internet. Like Jonathan Ive of Apple for his industrial design mastery. Like Aneel Bhusri and his team at Workday. And many others a bit less known but reinventing the way we work, play and live in our New Renaissance.

Yes, call me historian, please. There are plenty of folks who would rather be called Influencer and keep improving their Klout and other back slapping scores.

More New Florence

on the innovation blog

In politics, the era of Big Data has arrived

Carbon Nanotube Yarn

MindMeld me maybe?

Santa’s Warehouse

An event-ful  year

Wireless charging comes to Madison Square Garden

The song of the Alien Birds

The Hurricane Simulator

Do I feel lucky?

I can somewhat understand citizens of Orlando getting upset about the optics of the City’s apparent no-bid award to Workday. But for competitive vendors to howl about it is, well, a bit hypocritical.

Sole sourcing runs our industry:

a) Most software vendors get automatic maintenance renewals, even though customers have third party maintenance and self-maintenance options

b) HCL says $ 180 bn in outsourcing contracts will come up for rebid in next 3 years. I would bet $ 40 to 50 billion of that never go out to an formal bid. The incumbent provider will go to the customer with a somewhat better set of economics and harp on the hassle of the bidding process and transition to a new provider – and succeed.

c) How many of us buy third party consumables for our printers? There are plenty of pretty high quality non-OEM refillers and new cartridges available these days.

d) How many iPhone customers are still with AT&T in spite of well publicized network issues with the early versions and with continued outrageous roaming charges? This even though Verizon and Sprint now offer competitive offerings.

I could go on.

The reality is brand loyalty, apathy, inertia all help keep incumbents in place. So, those who want to protest every no-bid they were not invited to, ask yourself this: are you willing to open up every no-bid that you yourself benefit from like examples above?

In fact, go back and watch Dirty Harry and answer Clint and his Magnum 44:

Do I feel lucky? Well, do ya, punk?

The City of Orlando and the Workday contract

The Orlando Sentinel ran a story “Vendors complain after Orlando spends $ 8.7m on software without bids”

I sent the reporter and the Editor this email

“I read your article and would like to share some reactions. I am a former Gartner analyst and there and since with my consulting firm have worked with a number of enterprises (admittedly more in private than public sector) on ERP projects and hear the same arguments about economics of SaaS versus on-premise software. I am also a technology author and blogger and write on those topics on a regular basis (and objective basis - Workday and many of its competitors are sponsors of my blogs and I have a formal independence policy)

Eric Kimberling's car buy versus lease metaphor is a bit flawed. He leaves out things like "gas, insurance, oil changes" which are included in most SaaS contracts. In an on-premise license you have to host the software on your own servers and storage, or at an outsourced data center. In SaaS, it is included and hosted at the vendor's data center. With on-premise you end up with several application management staff to tune the software, staff help desks etc. With SaaS, most of that is included. With on-premise software, there are regular and expensive upgrades for which you often hire external consultants. With SaaS, it is delivered in background. There are several other elements where SaaS provides better economics and service levels. When you add all that up, in my experience, SaaS does much better than on-premise, and the longer tern the "total cost of ownership" calculation, the better SaaS looks. 

Now, should Ms. Sutton's staff have run a competitive bid inviting other SaaS vendors? Could Orlando have done somewhat better? Tough to answer without looking at all the detailed spreadsheets, but you would also need to factor the cost of months of bidding common in government. In the private sector, where most of my experience is, it is tradeoff between time to get started and the potential savings from a competitive bid.

I was in the audience in Las Vegas at the Workday conference and was surprised to see Dave Duffield, the co-CEO invite Ms. Sutton up on stage. I was surprised because in my experience Workday has been adopted by companies like Flextronics with a "fail faster" culture. My book below has a case study on the high-risk, global project Flextronics took on when Workday was in its infancy.

My surprise quickly turned to admiration for Ms Sutton for joining the ranks of progressive companies which have adopted SaaS solutions. I live in Tampa, and while our local government does well, I have long admired your city's ability to scale into a global powerhouse with your fantastic airport, Lake Nona  and other projects. I tried to find Ms Sutton to congratulate her but did not manage to.

You raise the costs of the team's trip to Las Vegas. A huge benefit with SaaS that does not show up in spreadsheets is most customers tend to be on the same software release. So their conferences tend to have much more vibrant customer experience sharing than with on-premise vendors where customers are fragmented across releases. So, to me the trip helped introduce the Orlando team to other customers - a nice asset to leverage during the implementation. I would also suppose Ms Sutton took the opportunity,  or will at some point, to sell the Workday team on some day moving the event to Orlando. While the Aria in LV is a superb property, your city can compete pretty effectively for that business.

I am not a Orlando taxpayer, and certainly realize your citizens may not share my enthusiasm, but I thought I would share my thoughts. Thanks. “

My 2013 predictions

are

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That’s right, they are blank.

My visit to the Mayan ruins at Tulum last weekend affected me deeply. While we smugly make fun of their end of world today prediction, I was in awe that their centuries old prediction had grabbed our media headlines and our attention all year round. If you are going to predict, have the cajones to predict that far ahead. Not just a year ahead. Besides I am still savoring the amazing year that was (is) 2012. 

And God, walking those ruins overlooking the spectacular Quintana Roo waters,  I was embarrassed I attached sissy probabilities to my predictions in my previous job :)

2012 – what a year!

The New Florence blog set a blistering pace during 2012 – it will end year with 750+ posts. Each one of the posts makes you go “wow”, and very tough to play favorites but I scanned the titles to come up with a few that will remind us of 2012 years from now.

5 categories– The London Olympics, The Presidential Race, the Industry events I was part of, Mobile devices/apps/pays, and Advanced Analytics/Big Data - contributed over 150 posts to the blog. The first 5 entries below represent (only) one from each of those categories. The others represent either the end of an era (as with the Space Shuttle), the start of a new one (as with Japan diversifying  its energy policy after the tsunami and Facebook’s IPO ) or some that just stood out like the use of plastic bottles as bulbs in slums around the world or Israel’s missile shield during the altercation with Hamas.

• The biomechanics of Usain Bolt
• The education of Jim Messina
• A majestic afternoon on San Francisco Bay
• The feature which launched a thousand projects
• Internet of Things + Big Data + Future of Work = Massive savings
• Israel’s “Iron Dome”
• Japan’s energy shock therapy
• The 747 SCA (Shuttle Carrier Aircraft)
• The neuroscience of Bob Dylan’s genius
• Turning a plastic bottle into a bulb
• “The Hacker Way”

Enjoy these or feel free to peruse my bi-weekly summary posts and come up with your own list. With 750 to choose from you can make your own scrapbook of 2012 memories.