A review of Race Against the Machine.

I’ve just read Brynjolfsson and McAfee’s Race against the Machine in one sitting when I have masses of other pressing stuff to do.

It is short, sharp, engaging and easy to read. Put down that Scandinavian crime novel, ignore your travel expense application issues and read this book instead. I’m perhaps reading too much into the title,  but I can’t help wondering if it isn’t a hat tip to the rock band Rage Against the Machine.  If it is, deeply nifty sub-editing coolness.   If not,  it is a lovely  unintended consequence.

The book highlights the accelerating disruption that technology brings to the workplace and to the very definition of work. There is dark side to technology, and the authors have done a nuanced job in exploring this.  It makes a worthwhile change from the technology=progress drum beat.

It was especially good to see a section on the growing gap between wage  and productivity growth.  To see disquiet about median wage stagnation from technology focused researchers is a very fine thing.  There is more than a whiff of valorization in their argument.

Brynjolfsson and McAfee make excellent use of statistics, and this work is no exception. They use numbers to illuminate, and they do it well. The Bill Gates in a bar story is a lovely explanation of mean and median. They explain, but don’t condescend.

As with much of US business academia, the book is centred on the US economy, with fleeting mentions of the rest of world.  I didn’t spot the dreaded phrase “Corporate America”, but it may have been lurking there. In particular the solution section was too US focused. Moaning about  H-1B visas etc… However suggestions 17,18, 19 are spot on.

17. Reduce the large implicit and explicit subsidies to financial services. This sector attracts a disproportionate number of the best and the brightest minds and technologies, in part because the government effectively guarantees “too big to fail” institutions.

18. Reform the patent system. Not only does it take years to issue good patents due to the backlog and shortage of qualified examiners, but too many low-quality patents are

issued, clogging our courts. As a result, patent trolls are chilling innovation rather than encouraging it.

19. Shorten, rather than lengthen, copyright periods and increase the flexibility of fair use. Copyright covers too much digital content. Rather than encouraging innovation, as

specified in the Constitution, excessive restrictions like the Sonny Bono Copyright Term Extension Act inhibit mixing and matching of content and using it creatively in new ways.

There are strong echoes of Larry Lessig in the IP section (as an aside I’d like to get the authors’ views of Lessig’s recent work on political corruption).

More broadly though I’d like to see business school academia and IT research engaging more with the rich research tapestry of sociology and political philosophy, how about more Jessop and Harvey, and Herbert Marcusse needs a serious dust off.  I fancy I heard the very faint clang of  Weber’s iron cage in this work. I’d suggest that Maslow and maybe Hayek can take a rest for a while.

This book is excellent,  but would have been seminal if it had built upon the work of that chap from Trier.

Industrial action impacts high tech companies too

Thinking of strikes, it is easy to imagine coal miners, railway workers and automobile assemblers with shop stewards quoting Trotsky, Gramsci and Marcuse, and brandishing a well worn copy of the Ragged Trousered Philanthropists. This is a naive and foolish stereotype. As this example from Yahoo! shows,  industrial action is alive and well in the high tech industry. Valleywag reported on a strike at Yahoo in France.

[YOUTUBE=http://www.youtube.com/watch?v=kulOZowv0Qc]

(watch the video here if you dont see the embedded player)

Carol Bartz‘s lacerating eccentricity may captivate Silicon Valley, where she’s cutting costs left and right. Not so in Europe: When Yahoo tried to shut down operations in France, workers made this surreal, defiant video. And went on strike, naturally.Their point: Yahoo made about 1 million euros per worker from Yahoo France alone last year, and used to hype how “it’s important to have [locally] concentrated engineering activities… to innovate” in France, where it would base “one of [its] most important centers in Europe.” Yahoo France’s engineers will now stop working until Yahoo agrees that they shouldn’t have to stop working. At least they’re fact checking the internet company’s hype along the way.

(thanks Valleywag).

There is a  lesson for all “global” high tech companies. HR practices that work in the US don’t necessarily travel well. I have quite a bit of research in the pipeline on a related topic. I have seen global HR projects derailed because of worker and union opposition, forcing system redesigns and huge delays.

I’ll predict that the software industry will face increasing collective and industrial action. Social software makes it easier to organize and motivate around an issue, and create a strong collective even without the presence of a union. It makes it easy to reach the broader public too.  We have seen the power of the disgruntled customer using social media to mobilise support and opinion. Employees have access to the same tools and media. Executives of global software companies will need to get a lot more savvy about global HR issues. Gosh, that degree I did in Industrial Relations might actually be useful one day.

Linking performance to pay. The G20 and HCM software.

(photo CC 2.o attribution, thanks to g-hat!)

World leaders are gathering in Pittsburgh to discuss banking reform and other pressing matters. According to the Guardian,  the discussions are likely to be rocky.

European leaders appeared to be on a collision course tonight with Barack Obama and Gordon Brown after Angela Merkel, the German chancellor, warned that the G20 summit must not be diverted from clamping down on bankers’ bonuses and hedge funds.

The article continues.

Sarkozy has suggested that bankers’ pay should be capped at a certain percentage of their institution’s assets or revenue.

Fredrick Reinfeldt, the Swedish prime minister and current president of the European council, promised a “specific discussion” on bonuses including proposals for individual caps on bankers’ bonuses, that bonuses would be linked to achievement and not given if there were losses, and that there would be transparency on precise decisions taken by boards. “We from the EU will ask to be very clear on that” he said.

Putting aside the ethical and political debate, if Fredrick and Nicolas have their way, this would particularly riveting for anyone in the business of HCM software.

It looks to me this is a demand for an integrated employee goals / performance management, compensation and incentive compensation system that also integrates into a corporate performance and risk management system, combined with a significant dose of compliance reporting. 

Well done Norway

(gates of Vigelandpark, Oslo, Norway. from the cc flickrstream of D3 San Francisco)

I read this in the Guardian earlier.

This month, Norway set a new global record. It now has, at 40%, the highest proportion of female non-executive directors in the world, an achievement engineered by the introduction of a compulsory quota. Two years ago, after several years of voluntary compliance had failed to lead to a sufficient number of female board members, 463 “ASAs” – publicly listed companies over a certain size – were told to change the composition of their boards or risk dissolution.

And further…

According to the Norwegian government, the quota is not simply a strike for equality; it makes sound economic sense, too. Last year, Goldman Sachs, the global investment company, published a paper in which it outlined the economic reasons for reducing gender inequality and using female talent fully. Not only would this increase growth, the paper said, it would “play a key role in addressing the twin problems of population ageing and pension stability”

A quick Google brought me to this speech from Kjell Erik ØIE, the State Secretary, Ministry for Children and Equality, Norway. It makes inspiring reading, not because it is an idealistic policy position, but because it is idealistic policy delivered.  The whole speech is worth reading, but here is an excerpt.

In the near future the majority of European countries will have labour shortages and a swelling population of people over 65. The proportion of the employed population might be too small. Europe faces two main challenges in the years ahead. Firstly; to ensure that more children are born. Secondly; to ensure that more people work and work longer. The solution to these challenges lies in viewing family and equality policy in close combination with labour market policy and thereby as part of a larger modern growth strategy for the region. We must both increase the birth rate and achieve an including working life.

The key in economics of gender is a redistribution of power, care and work. When doing so, we will meet strong resistance. People seldom let go of power voluntary. There are counter forces to such a development. These counter forces needs to be addressed. But redistribution of power, care and work is the only road ahead for sustainable development in our region.

Norway is a pioneer in politicising fatherhood. We want to widen our understanding of men’s responsibility as fathers to include not only economic provision, but also psychological, emotional and physical care for children. When it comes to gender equality, we must create an alliance between men and women. In my opinion, both genders gain from a gender equal society!

Instead of moaning about the cost this would have on business and pushing for watering-down and delays, the Confederation of Norwegian Business and Industry (NHO)  made proactive and aggressive steps to help members comply. You can read more about Female future programme here and here. No one really likes quotas, but the NHO put a plan in place to change attitudes, drive change and thereby achieve the quotas.

The goals for the NHO’s effort on women and management are the following:
• Firstly, facilitate that the private sector is viewed as an attractive place to work by women.
• Secondly, increase the percentage of women in decision-making processes, in management and in boards in general
• Thirdly, involve managers as prime movers in the process aimed at recruiting more women to executive positions and to board posts
• Fourthly, facilitate that executive responsibilities may be more easily combined with family responsibilities – the balance between work and private life. quoted from here.

Lots to ponder on, yes, from the CSR / HR/ Change Management/ Talent Management perspectives, but fundamentally as a father too. For now huge respect to Norway.

(from jamieca‘s flickr stream)

The words of Benja Stig Fagerland, who ran the Female Future project , put a little spring in my step this morning.

Fagerland says she plays a game with her daughters based on the Swedish fictional character Pippi Longstocking, a girl who believes in herself and is utterly unconventional. “We break all the rules. Everything is turned upside down. We wear pyjamas in the garden and eat sweets before dinner. They love it.

“I want them to constantly question why things should be as they are. In business, you can always find ways of playing the game differently and better. But first, you have to know your own level of competency and your price – and never sell yourself cheap. For your own sake, and for the sake of all those women who come after.”

Brilliant advice. Takk.

On a related note, you may be interested in this blog from the University of Cape Town, Women in Leadership. 

Technorati Tags: norway,equality,rights,women’s_rights,management

More on Africa and what mashups can be used for.

I have rambled and ranted before about African based industry, software deployment even African Mathematics, but I figured it was time for another rant on Africa and social media.

James Farrar posted this question a couple of weeks’ ago  when reviewing the blogger coverage of the Davos gathering.

Surely all these gadgets, communications and software we hold court on can offer something to help in terms of improved communications, institutional development, education and economic development for countries like Kenya. Something? 

He is right. In our  industry we talk so much about the tools, we  sometimes forget that there is more to the world than using one set of tools to talk about another set of tools.

Quoting him from a different context altogether, Jeff Nolan had this to say..

Check out this snapshot of Techmeme today. As is typically the case, Google scratches its left ear lobe and an entire industry of bloggers kicks into gear dissecting what it means.

It reminded me of a cartoon from the always funny often insightful Oliver, over at Geek and Poke

 

I started watching a video clip from Demo 08, thinking that I was going to blog about some of the cool African start ups in social media, mobile phone innovations, and laptops powered by bat droppings  but after watching it I  changed my mind.

You can watch the video here please,if the embed fails. (the video is about 30 minutes)

 Mike,one of my regular link victims, Erik Hersman who writes the brilliant White African blog, and Juliana Rotich of the excellent Afromusing  appeared on the panel.

Yes, they covered off some of the interesting solutions and services on the web in Africa,  talked about mobile phones, and developing market economies, all good stuff but what made me stop multitasking and really really listen was the discussion on Kenya, and I think it goes some way to answering James’ question.  Watch the bit about the Ushahidi project , and spend some time on the site.

Mashups of where the nearest Starbucks drive through is located have their utility, and I’m not knocking them, but seeing a google maps mashup of violence outbreaks in real-time reminds me that there are other, more important challenges and uses for the tools. Blogging is great to cover the latest cool new laptop launch, but there is something fundamentally good about being able to get a post up on wordpress.com in minutes to highlight Brian’s plight.

 

One of the most thoughtful commentators on Africa in the blogosphere is Ethan Zuckerberg. His piece on the Kenyan middle class is worth a read, but I’d like to quote from one his posts about TED.

Mwenda points out that mainstream media doesn’t cover Africa, in print, in television or on the web. When it’s covered, “journalist behave like scavengers of disaster”. When coverage of disaster captures the truth, it’s only capturing part of the reality. They’re missing all the stories of ordinary people doing amazing things. “When people like Sergei Brin think about Africa, they think in terms of giving aid, not in terms of opportunity.”

Although  comedy, this clip from the Onion is rather too close to the truth for comfort. (you will need click here   because wordpress.com seems to disagree with oinions)

Nation Of Andorra Not In Africa, Shocked U.S. State Dept. Reports

Technology can play a vital role in times of crisis, but more than that, I have a hope that social media will help Africa tell its own story. As Zuckerberg notes, the web enables him to point, not tell. 

If you are interested in learning more about Africa,  then TED is an excellent place to start understanding its beguiling complexity.  Have a look at Joseph Lekuton, Ngozi Okonjo-Iweala, Andrew Mwenda,  and Chris Abani. TED Africa 2008 looks to be a must view event.

Afromusing has an excellent blogroll, and herewith a random excerpt from What an African Women Thinks.

I’m very cross with Mwai Kibaki, Raila Odinga and their respective hardline surrogates today, for putting us in this position where the “International Community” have all the excuse they need to swagger into our sovereignty and order us around.
Because Condi, Milliband, and that tall German whatsisname guy with an unkempt moustache would not be all up in our faces being patronizing if Kenya’s erstwhile leaders just left their mountain-sized egos outside the negotiating room and got their acts together already. We want back our country and our pride. Give us back our country and our pride.
Seriously, today: Me. Cross. At these so called leaders of ours.
Wincing and squirming and cross.

There is more out there than techmeme. But if you are wedded to knowing the latest and greatest gadgets then please add Afrigadget to your RSS feed.

Oh, and finally again via Afromusing I’d like to remind you that Africa is open for business 

Technorati Tags: demo08,TED,Africa,social media

Dusting off the Weber

Most of the time when I think about Weber, I mean one of these.

photo thanks to massdistraction.

Not this fellow, Max Weber.

photo from Wikipedia.

While browsing through my feedreader  (actually I think it was on Techmeme) this morning I read this article, the Wisdom of the Chaperones.

Social-media sites like Wikipedia and Digg are celebrated as shining examples of Web democracy, places built by millions of Web users who all act as writers, editors, and voters. In reality, a small number of people are running the show. According to researchers in Palo Alto, 1 percent of Wikipedia users are responsible for about half of the site’s edits. The site also deploys bots—supervised by a special caste of devoted users—that help standardize format, prevent vandalism, and root out folks who flood the site with obscenities. This is not the wisdom of the crowd. This is the wisdom of the chaperones.

Nick Carr, who often writes about wikipedia, said something similar a while ago.

The myth begins with the idea of radical openness, the idea that Wikipedia is a creation of the great mass of humanity in all its hairy glory. It’s a myth encapsulated in Wikipedia’s description of itself as “the free encyclopedia that anyone can edit.” As we now know, that’s never been precisely true. According to cofounder Jimmy Wales, there have always been filtering mechanisms to restrict certain people’s ability to edit certain articles. Those mechanisms have been expanded and tightened over time. In Wikipedia’s early days, the encyclopedia asked contributors to maintain a “neutral point of view,” but, as the official history of Wikipedia notes, “There were otherwise few rules initially.” Since then, rules have proliferated, as the encyclopedia has adopted a de facto bureaucratic structure.

And Andrew McAfee at Harvard includes a wikipedia case study in his MBA course, and his picks on Wikipedia’s  bureaucratic nature.

Thinking about wikipedia, elites and bureaucracy took me back almost 20 years, to a sunny afternoon in Pietermaritzburg with Prof Irvine. We were discussing a paper I’d written about J.S.Mill and Max Weber on bureaucracy and democracy. Much of Mills’ thinking has since slipped into a dusty corner of my brain, but Max Weber has stayed with me ever since.

Although he was writing about 100 years ago, I don’t reckon he would have been surprised by how Wikipedia, or indeed most of the web 2.0 world is organised.

II. The principles of office hierarchy and of levels of graded authority mean a firmly ordered system of super- and subordination in which there is a supervision of the lower offices by the higher ones. Such a system offers the governed the possibility of appealing the decision of a lower office to its higher authority, in a definitely regulated manner. With the full development of the bureaucratic type, the office hierarchy is monocratically organized. The principle of hierarchical office authority is found in all bureaucratic structures: in state and ecclesiastical structures as well as in large party organizations and private enterprises. It does not matter for the character of bureaucracy whether its authority is called ‘private’ or ‘public

From Max Weber, Wirtschaft und Gesellschaft, part III, chap. 6, pp. 650-78. (more at this site).

Some learned commentary here.

Bureaucracy is in fact the division of labour applied to administration, and bureaucracy occupies the same place in Weber’s account of the development of modern civilization as division of labour in general occupies in Adam Smith’s account. For Weber this species of division of labour is more fundamental than the others because it initiates and orders other divisions of labour. Instructions come to the factory floor from the office. Just as Adam Smith saw division of labour in general as the cause of progress toward modern, generically commercial, society, so Weber sees bureaucracy as one of the most important causes of the development of capitalism specifically. He points to many cooperating causes (see Collins), and in The Spirit of Capitalism puts some emphasis on the moral causes – on the factors that made people strive for ever increasing profit, and to use their profits not for consumption but for further investment. But among the causal factors he often mentions the adoption of rational accounting methods: no amount of will to make a profit, or willingness to invest, would have had the desired result if investment and management had not been guided by systematic accounting, carried on of course increasingly by a bureaucracy. Once some began to be systematic others had to follow suit or go under. Labourers were ‘separated’ from the old-fashioned means of production by the superior effectiveness of production guided by systematic accounting – they could get a better living as employees. Capitalists adopted machinery and other innovations when their bureaucracy analyzing the possibilities of investment found that such innovation would be profitable. In fact a bureaucracy finds its own capitalists. As modern Weberians have pointed out, modern firms are run, not by owners, but by their managers, who often initiate the issuing of shares to raise capital, or seek loans or investments.

As I sit in the sunshine today, slightly more than a stone’s throw away from where Max Weber did much of his teaching and writing, I wonder what he would have made of today’s online world? What would have impressed him? What would disappoint? Would he find his Iron Cage and the polar night of icy Darkness, or would  he be pleasantly surprised?

The great social theory thinkers of the past 150 odd years;  Tonnies, Parsons, Durkheim, Comte, Spencer,  Mill, Bentham, Weber, and even Marx can teach us  a whole lot more about today’s online cultures, institutions and behaviours than we realise. 

I’m hoping that somewhere in a political science or sociology department there lurks a Weber 2.0, someone that will apply the same levels of rigour, research, insight and original thought to today’s world as Weber did at the turn of the last century.  I also hope that he/she has  a blog.

from wikipedia.

Technorati Tags: sociology,wikipedia,Weber,Carr

Well done Hasso Plattner Ventures

 

(photo thanks  DFarber)

I  have received this Business Week article from a friend of mine, thanks Mike. Excellent news.

On Feb. 15, Hasso Plattner, the billionaire co-founder and former CEO of German software giant SAP (SAP) announced in Cape Town, South Africa, that he is starting a new $42.3 million pan-African venture capital fund with the help of Germany’s MAN Ferrostaal, a global provider of industrial services and key player in alternative energy. Plattner is investing $36.48 million of his own money in the fund, while the remainder comes from MAN.

Plattner has recruited an impressive team of managers. Among them: Malengane Machel—son of the late Mozambique President Samora Machel and Graca Machel-Mandela, who is now married to South African icon Nelson Mandela—will be a venture partner. In addition to providing capital, the new fund should help open doors for African companies throughout the tech industry and in such industrial sectors as heavy engineering, automotive, and green technology.

I am sick and tired of Africa being written off as a basket charity case, so it fabulous to see a significant venture fund targeting African start up innovation.

Hasso Plattner Ventures Africa will focus on pre-profit innovative companies, Böhmert says. “This is a First World country when it comes to research and development capabilities, but at the same time a developing country, so it is perfectly positioned to develop solutions for the Third World.”

Indeed, poor inhabitants of South Africa’s townships are clamoring for services such as mobile banking so that they can wire money to relatives and friends or prepay for utilities such as water or electricity. “We are seeing some companies already that will be a good fit for the new fund,” Davidson says. “There will be a big emphasis on social entrepreneurship. We can make the world a better place and make money at the same time.”

Social entrepreneurship, goodness indeed. 

Technorati Tags: South Africa,VC,Hasso Plattner

Schumpeter and Wikipedia, a case for creative destruction

I’ve just finished reading a brilliant biography of a brilliant man. The Prophet of Innovation – Thomas McCraw’s biography of Joseph Alois Schumpeter is meticulously researched, insightful, and thorough.  McCraw writes with a deft and personal touch. He manages to mix the tale of Schumpeter’s complex personal life with a broad tour of economics, and provide a deep insight to his huge impact on economics and business studies. McCraw makes Schumpeter accessible without compromising the depth and the complexity of his work. This is a rare talent, and the book is a treat.  (here is another review,   another, another and another)

Anyone who is interested in how capitalism works or doesn’ t work ought to spend some time with Schumpeter. McCraw’s book is a great place to start, or an even better place to rekindle an interest.  I’d read Schumpeter a bit at university, but I didn’t give him the focus and respect he deserved. I will need to re-read him. Capitalism, Socialism and Democracy (CSD) will be my companion for my next airport lounge visit.

Filled with my newly found Schumpeterian knowledge, I headed over to the wikipedia, mainly to save me re-typing stuff about him here.  I’d planned to post something about innovation, standards, big companies and software, but that will need to wait.

As usual, typing in Schumpeter in Google brings up the wikipedia entry first.

 I was really disappointed with the  wikipedia piece

The entry could do with some significant creative destruction.  It is factually inaccurate, and it damns Schumpeter with faint praise. It is equivalent to saying Mozart wrote a couple of nice tunes.

According to Wikipedia,

During his Harvard times, he was not generally considered to be a very good classroom teacher, but he acquired a school of loyal followers. His prestige among colleagues was likewise not very high, because his views seemed outdated and not in touch with then-fashionable Keynesianism. This period as a Harvard professor was characterized by very hard work but also by little real recognition of his core ideas.

It is true that he had a long standing battle with Keynes, but very little else in that paragraph is correct.

1.He was elected President of the American Economic Association in 1949, the most prestigious office in the country for an economist. (first foreigner to get the honour)

2. When Yale tried to headhunt him, and all 17 members of the economics department signed a letter urging him to stay, and 26 of his Graduate Students did the same.

3. He was rated very highly by graduate and undergraduate students in reports.(There is some disagreement on this when he was near the end of his career.)

4. His History of Economic Analysis received rave reviews from his peers. (as did CSD)

5. His speech to American Economic Association in 1948 received  “A thunderous and prologed standing ovation.It was a spontaneous expression of respect and gratitiude…”(McCraw p 483)

6. On his death (while still an active faculty member) His Students and Colleagues took the very unsual step of dedicating a future issue of the Review of Economics and Statistics to him.

7. McCraw commented that Schumpeter would have won the Nobel prize for economics if it had existed then.(3 of Schumpeter’s students did win it.) He also noted that in 1950 Schumpeter was the most illustrious economist in the world.  In 1983 Forbes Magazine christened Schumpeter as the most influencial economist of the 20th Century. 

The wikipedia piece doesn’t even mention his other major work, the History of Economic Analysis. His analysis of the role of credit, venture capital, and strategy don’t get a mention either. There is no mention of his wife, who played a key role in keeping him on track.

McCraw commented in an interview

As for my personal feelings about him, I think Schumpeter is one of those historical figures that anyone would love to have dinner with, as many people have said of Benjamin Franklin. He was just so witty, knowledgeable, and downright interesting that you couldn’t come away without feeling enriched. Weaving together the fascinating story of his life with an interpretation of his great body of work made the writing of my book not only a challenge, but also a tremendous pleasure.

You would never know this from reading the Wikipedia. More’s the pity. And more ammunition Wikipedia’s most fervent critic.

Technorati tags: schumpeter, McCraw, Wikipedia, biography