Monday, October 3, 2011

Big Data

I was recently quoted in an article by David Rosenbaum of CFO Magazine on the use of data at American Airlines in the 1980’s and at FedEx over the last decade http://www3.cfo.com/article/2011/8/analytics_that-new-big-data-magic . As is the nature of these articles, there was some information left out that would have made the article even more useful.


One reader, Timo Elliott, wrote me to ask some clarifying questions and followed up in his blog http://timoelliott.com/blog/2011/09/relying-on-data-can-lead-to-the-wrong-decisions-says-cfo-com.html .

I want to go into a little more detail on both the AA situation and then clarify a point on the FedEx aspects in the article.

The technical situation at AA in about 1986 was that a Teradata DBC 1012 was a very small machine so all the data we could load into it was the flight data of the AA Gold Card members. At the time gold cards were given to something like the top 2% of the flier in a market.

Tom Plaskett was the senior VP of Marketing and he did ask us to see how many AA Gold Card members were flying British Air (BA) from Dallas to London Heathrow. As I explained to Timo, at the time you could fly on BA from Dallas and get AA frequent flier miles. So, on a head-to-head basis, the best AA customers preferred BA and did so overwhelmingly.

It isn’t worth the time to review the airline situation in the 1980’s. It was turbulent with lots of airlines failing and new ones starting up. It was combat.

AA had a plan to compete and part of that plan was to improve the quality of the product from end-to-end. The data on the Gold Card members was just one input but seemed to support the contention that customers would pay more for quality.

AA was wrong. It spent a $billion to improve everything from on-time arrivals to how the wine was served in first class. Didn’t make any difference. While the data clearly answered the question asked, it didn’t give the solution even through it appeared to—make AA flights as good as BA flights.

I could go into details about why the quality plan didn’t work but that is beside the point. The point is that the data can tell you what is going on but it isn’t predictive. To develop a solution you have to do more, maybe a lot more, analysis.

I want to correct something in David Rosebaum’s article about FedEx. In his article he says that when a newly signed customer doesn’t start shipping when expected FedEx pings the customer’s Blackberry wanting to know why. Not exactly correct. It is the salesman’s Blackberry that gets pinged. It is the salesman’s job to find out if there is a problem and get the customer shipping.

Thursday, July 14, 2011

Randy Mott and HP

There a ton of comments out there about the Information Week article on and about Randy Mott.  I had the opportunity to meet him a couple of times and to work with some of his key people a lot more.  There is not doubt in my mind that HP needed to do something to fix its IT cost structure but it isn't clear to me or anyone that I know of that what Randy did made HP better.  In all the comments I have seen no one has come to his aid.

What is clear to me is that what HP was selling about the work he was doing and the processes he was following were more vapor than anything.  For an example, Randy said and his people said he had a playbook; that similar to football coaches (their analogy) he knew what he wanted to do each day of the week.  Since I was helping to lay out a transformation at FedEx and we were great business partners, I asked to see his playbook just for ideas. 

I never got it.  First I was told HP was going to commercialize it for their consulting business.  But as I pressed over several weeks it because clear that it wasn't a matter of taking something and cleaning it up for customer consumption but that it didn't actually exist.

Sort of the same story with the push to move all business units to common systems.  The story told and retold was that a single system was selected and all business units had to adopt it.  The truth, according to several engineers, was that a lot of modifications were made to the selected system because that system lacked functionality or was a very different business process.  The engineers were fighting hard behind the scenes to help their business partners.

I hope the business didn't forget them now that Randy and Mark Hurd are gone.

Wednesday, June 22, 2011

Feeling Much Better

A quick up date.  I started to improve rapidly about 5 days ago and feel pretty good.  The dizziness from the concussion is less.  The numbness in my left arm and hand is also resolving.  Both of these injuries take a long time to resolve, I am being told, so it could be months before I know if they are permanent.  But for now I feel a lot better.

I have had a chance to look at my bike and it is definitely dead.  The rear dropouts were torn out of the frame and broken.  And one of the seat stays is crushed--I can squeeze it with my hand. 

Thanks for all the best wishes.  And for my wife and daughter who took great care of me for the first three weeks when I was pretty much out of it.

Tuesday, June 21, 2011

Changing Jobs--Four C Framework

I have gotten a lot of inquiries about career development when the company doesn't seem to be interested in you.  I am preparing an article for IW on the topic but it is a few weeks away.  So I wanted to sketch the main points here for those seeking advice.

All of the inquiries I have received have been from managers wondering how to get a promotion to director so I target my comments to them.

First, you must have a realistic view of your potential and a solid reason for wanting a promotion.  I have interviewed so many managers over the years who absolutely were not going to get a director promotion and no amount of coaching was going to over come their talent gaps. 

And then there were their reasons for wanting the promotion--like "I have been a successful manager, it is time...", "I can do the job", and "I deserve a promotion and more money."  All terribly weak reasons.

But if you really feel you are talented enough to be a director and have a great reason then you have a hard decision to make.  You have to decide whether you can over come the reasons you have not gotten that promotion in your current company or whether you have to seek that promotion outside the company.

Both have risks and at the manager level the risks might be the most acute.  It is very hard to distinguish yourself as a manager from all the other managers out there.  And once you start looking for a job outside the company it is likely that that will get back to your director.  So unless your situation is particularly desperate only consider changing companies for a promotion.

Just because you get an offer of a promotion doesn't mean you should take it.  Here is where my 4-C framework comes to play.

Company.  Is this really a company you want to work for?  Is it in an industry with potential.  Are its products something you really want to be associated with?

Career.  If you have a career plan does this fit.  If your career plan is just to get promotions then rethink your career plan.  But if you have a solid idea of where you want to go and what you want to do, does this job move you in that direction.

Chemistry.  Even if you have the right company and right career move, you have to be successful.   And a lot of being successful is having an environment and people with which you can work.  There are lots of reasons why new hires fail most of them can be lumped into "didn't fit in".

Compensation.  I add this to the list because it should have nothing to do with your decision.  If compensation is a major reason for changing jobs or you want this job because of the compensation then you are likely making a huge career blunder.

If you are a manager today then you likely have 30 to 40 years to work.  A bad decision now can cost you for the rest of your career.  Make wise and informed choices.

Friday, May 20, 2011

Business Outcomes

The May 15th CIO Magazine is such a duh.  Basically the main theme is that CIOs are changing their mantra from "alignment" to "IT and business are one."

Duh.

I have argued for years that aligning IT and the business is far more representative of failed CIOs than a valid IT strategy.  I am not sure I even know what alignment means.  If it means the strategies and objectives of the company as a whole then a misalignment should have been corrected immediately.  If it means aligning with every business leader than IT is going to be dysfunctional because not every business leader is aligned with the goals of the company. 

Gasp!

There are times when great CIOs drive things.  I think of Max Hopper moving SABRE from an internal American Airlines system to a travel agent system.  Or of Dennis Jones pushing customer automation for FedEx.  But most CIOs are consumed by working the edges--trying to get their resources on those projects that best meet the company's goals.

If this recession taught IT anything it is that IT and the business are one and always have been.

Tuesday, May 17, 2011

HP's Results

I liked Mark Hurd.  I liked him when he was at NCR and I liked him at HP.  I was totally surprised by his leaving HP and the circumstances just seemed uncharacteristic.  But I have been fooled before by men's behavior and I have no inside knowledge.  Nevertheless I thought he was on the right track at HP.

Today's results were pinned on Mark and I guess that is to be expected.  That is the way of corporations.  When someone leaves a company anything accomplished gets claimed by someone and all failures are piled on the departed.

I was a large HP customer and HP had done some really good things for me.  But sometime in 2008 things weren't going as well.  Technical resources were now focused on selling services and they were bad at it.  There were times they were trying to sell services they hadn't even documented yet.  This was especially bad after the EDS acquisition.

So maybe Mark Hurd was at fault for HP's results or maybe he didn't get the right people assigned to do the work.  HP needed a services business and EDS was about the only option.  HP's cost structure was out of line with IBM's and had to be fixed.  I think he made the right strategic business moves but obviously the execution and integration didn't go well.

Friday, April 29, 2011

InformationWeek Article

I published an article in InformationWeek on developing high potential directors and vice presidents.  There has been good reaction to it the first day.
http://www.informationweek.com/news/global-cio/interviews/229402346?pgno=1

A few people have written to me directly with questions which I answered directly but I think it is worth repeating the answers.

I don't think I will write a book.  I know what Charlie Feld went through with his and he is a MUCH bigger name than me.  He had to self publish and jump through all kinds of hoops with Amazon.  I don't know if he ever got into the book stores; especially those in airports.  Besides, I am too lazy to write a book.  Having written a dissertation I have a good idea how long it takes to edit.

But I will blog answers to questions and comments.  And there is lots of material.  I think the most interesting discussion is on the InformationWeek comment section on the role of politics in promotions and whether politics trump individual abilities. 

I want to give this some thought as the topic is complicated and nuanced.  For example, just what do people mean by politics?  There are always politics and individual agendas but that doesn't mean they are bad.

Another topic is how to help your boss and his/her boss improve using these core competencies.  I think this is very risky and likely a very bad career move.  While I think there are definitely things that should be said to your boss or your boss's boss, unsolicited suggestions on how to improve their management effectiveness isn't a place I would start.