The Functional Idiot

Here is a story. I’m sitting in a room with an extremely intelligent  person. Our new VP of product marketing – Mr Y. He has an MBA from one of the finest universities in the world ,a track record as a C level executive in a Fortune 100 company. He is articulate and presents an amazing vision for the future of our company. Moreover, he defines concrete examples how we will be using social media and go beyond traditional  enterprise marketing. I’m quite impressed. Finally, we have someone in marketing who knows what he is talking about.

One month later, Mr Y Speaks in an executive forum. He repeats exactly the same story with the same social media example and same jokes. I’m getting a bit suspicious , but as the great Jack Welch said – communicating your message is one of the top leadership roles. So, I give Mr Y the credit that he is talking to a new audience.

Two months later, Mer Y is already working with us for four months. We are in a customer conference. The same exact story, word by word . Two months later he was not working with us anymore …

He is probably a “Type A” functional idiot.

I recently learned the term “Functional Idiot” which I really like. Unfortunately it is not well-defined, yet. The Urban Dictionary definition for “Functional Idiot” is :

A person who suffers from functional idiocy.

Which does not help much. However, almost everyone seems to “Get It”, so they must have worked with some.

There can be a few of ways to describe a functional idiot:

• Type A functional idiot - A complete idiot who made it through the system to obtain an important function or position (e.g. George Bush Junior )
• Type B functional idiot – A very smart person in specific domains who behaves like an idiot in other domains  (e.g. Steve Jobs’ failure to admit he needs to shower to smell good)
• Type C functional idiot - A person who used to be very smart and effective, but became outdated and irrelevant (e.g Dan Margalit might be an example for the Israeli audience)

Let’s say you are walking around the office and you spot a “Functional Idiot”  make a stupid decision. Let me provide you with tools to rationalize it.

Here is a second story. In a board meeting, you realize one of your board members (Let’s call him Prisoner X)  suggests the company should release a “simple self-service” version of your costly, sophisticated enterprise product. This could have been   a great suggestion. But we already did it six months ago and discussed it multiple times with him.

The challenge is that Prisoner X is quite smart and has a very good track record in the industry. How can we explain the fact he get’s $40K$ a month ,but is not able to remember the main products of his four companies?

Prisoner X is probably a type B functional idiot. He is very smart in the big picture and in identifying opportunities, but he is very bad in operational work and following details.

Type C functional idiots are easier to spot. You would usually find them in the CTO office, they have the word “Strategy” in their title.  in a recent example I was observing a very long thread on the pros and cons of C vs C++. The heated discussions was taking place in 2012 by people with an amazing track record in the high-tech industry history. And it was a very interesting discussion to have. In 1996.

To conclude,It is essential to identify functional idiots and tell them apart. Otherwise  we are all doomed

Could Israel Lead The Data Science Revolution?

Tel Aviv Yarkon River Kayaking

Israel has an enormous potential to play a major role in the new “Big Data” and Data Science ecosystem. Data Scientist is becoming a very “sexy” profession and since “Big Data” is expected to create a huge market, the opportunity should not be missed.

Israel’s has the following advantages:

• A World class academic activity in machine learning , pattern recognition & text analytics. Some example are: Prof. Yishay Mansour , Prof. Naftali Tishby ,Prof. Yair Weiss and Prof. Amnon Shashua.
• Large supply of candidates – there are quite a lot of great PhD or MSC graduates in Applied math, Statistics  Physics , Biology, Bioinformatics and Chemistry . Since the universities have a very limited supply for tenures, the pool is quite deep. In Europe and US there is shortage of these skills.
• These are not new topics For the Israeli Intelligence community and broader Israeli security sector. There are experienced experts who built proven,production systems. The experts are not only on the math side, but also on the business analysis side.
• Typical Israeli data scientist has more IT\programming skills. While these are not mandatory features for success,they tend to accelerate the discovery process and add a lot value.
• There are quite a few business applied Data Mining companies in the commercial sector and in start-ups arena (e.g. Pursway).
• The excellent communication skills, domain understanding and language diversity , especially compared to classical never-worked-outside-of-university PhD. Many Israeli PhD are “forced” to work in teams and in the industry to make a living, or during their army service, so even the more introvert types make a solid team player
• 50% reduced cost compared to US – for various historical reasons the PHD\Masters title is not as economical as in the states. An amazing Java developer with no degree at all would probably earn twice as much as an amazing chemistry POST-Doc from Harvard. While this is a shame, it presents an opportunity for Data Science service out of Israel. Moreover, there are less hedge-funds to waste people talent

There are various directions to capitalize the potential:

• Providing Data Scientists as a service, out of Israel. While remoteness presents some challenges, we have seen early success. It seems that the pros outweigh the cons.
• Build infrastructure products for Big data – around Hadoop, Hive, Mahoot etc. Adding the enterprise features and improving performance  These are similar in nature to traditional Israeli expertise in networking, storage and security. In my opinion, there is higher chance for na Israeli start-up to succeed here, bigger than in a new social application.
• Develop innovative services that use Machine Learning internally to gain a competitive edge (In advertisement, Retail or Medicine)

In a world where “old-fashioned” software engineers are more and more common, each one of these direction can help maintain Israel’s Hi-Tech uniqueness.

P.S

I just saw that other people also think Israel has the chance to be a world leader in big data . Although the quote is from EMC, I knew nothing about it

Tel Aviv Bicycle Race Sukkot 2012

Are Public Companies Owned by the Public?

Board of Directors Keeping a Low Profile Cartoon

Is the entire governance model of public companies broken?

In theory, public companies are owned by the public shareholders and the goal of the company is to increase the long-term value for them.

In practice , many companies are managed by minority shareholders or ineffective board members , that can not be replaced by the majority public shareholders.

Lets assume I own HP stock. Assume I think the board is not doing a remarkable  job. Since four CEO were changed in recent years, it is unlikely that all CEO’s are to blame.

How can I change the HP board of directors? This is quite impossible as I have a very tiny share of HP shares. But the largest owner has only 7%.

The classic capitalist answer is that I could sell my HP share, and if many people follow my footprints, the board would “Get the message”.  However, there are some very nice incentives for being a board member ($381,000 per year in this case) , so there is no reason for board members to resign. For example John H. Hammergren is a director of HP since 2005 and despite of the stock decline he did not “get it”.

Maybe he is an amazing director ,I don’t have  any data, but the stock does not reflect it.

HP (HPQ) Stock Price 2007 To 2012

In theory, I can send a fax a nominate my own director , but I have the feeling it would be challenging, as the process is complex.

In 2012, for example, only 20 such proposals were submitted and only 8 actually got to the voting stage.

In other companies, in which the CEO has 10%+ of the share, things might get even worst, as a minority shareholder (10% is smaller than 90% ) is running the show, and effectively selects the board members on his own. There are many conflicts as a result. It is very hard to believe that his own compensation as an employee is not highly biased because of his shareholder position.

The current practice in which the CEO’s have large influence on board selection seems extremely problematic.

One possible solution is to move to a more direct, democratic, online model elections model.

Each shareholder would be able to suggest a director ,electronically and vote, proportionally to his shares on the best directors to run the company.

As a result, the directors would also have to convince the public on their achievements, independence and value to the shareholders.

It would also help eliminate some of the nepotism , which is often seen in Israeli stock exchange, and in a more subtle ways in NYSE and NASDAQ.

Such a model would be modern, effective and representative of the public interest.

Three Examples on How not to Lead by Example

Three stories that never happend and probably never will

Porsche and Outdoor Camping

CEO in a Tent

As a CEO Invite your top executive team,some over 50 years old,  to an outdoor seminar, sleeping in tents.

Explain to them that sleeping two in a tent would bond the team together and allow an early start in the next morning.

Drive home with your Porsche Jeep and personal driver to sleep with your spouse.

Arrive late the next morning because of traffic, while everyone is waiting for you to start the training.

VP Engineering and the Hacked Weekend

Following a major security vulnerability found in your department code you call all developers to look for more bugs on the weekend.

Explain that while you don’t expect a one ay effort to find bugs that were not found in year, it is a critical method to communicate  the importance of secure coding.

On the same weekend stay with your family at home. After all , you don’t even know how to check out the code from RCS, let alone find security bugs in it.

Banana Performance Review

VP HR slow Performance (Review)

Force the entire organization to a methodical yearly performance review.

Force the managers to put the employees on a standard distribution curve.

Calculate the bonuses as a direct result of the performance review, with 1% flexibility.

Perform the performance review for your own direct reports three months behind the deadline, in a casual and quick manner.

I can’t hear you, I Want to see you

This extremely funny clip serves as a good demonstration to the state of the art in conferencing. But if humankind can ride 30 meter waves, maybe there is a chance we can improve here as well.

Video conferencing is going to hit mainstream – the technology and bandwidth are available for couple of years , but now the software and hardware are also ubiquitous.

Smart phones and new laptops have an excellent built-in camera and microphone built-in and all the new messengers have built-in Video calling.

I have been evangelizing video usage in EMC Beer Sheva new site, and while it takes some time to get used to , it is hard to go back.

Don’t be surprised if the breakthrough here would come from a new player  and not the traditional players.

Unified Messaging – while there is no technology barrier to get it done, I know very few people who actually get all their email, phone, cellular ,calendar, voice mail and SMS information in aggregated fashion,in the same location and accessible through multiple views and devices. This is quite weird since the technology is around for a long time.

Even my $300 Cisco smart VOIP phone is no smarter than the $100 Panasonic wireless phone at home or the $10 unizen phone. No integration with email and messenger, no integration with cellular , no video capabilities. This seems like a product management issue.  Again, who ever gets it right and create the “DropBox” of unified messaging would “surprisingly” create a huge company.

High (Normal) Quality Voice Conferencing – at least 50% of the voice conferencing I attend have a horrible sound quality. People drop of, people can’t connect , there is background noise from traffic, annoying echoes, low sound quality and the list goes on. While the market is “commoditized” in theory this is , IMHO, BS.  While there are many free conferencing solutions they all suck, pardon my French. To make matters worst , the paid services are just as bad. I would be very happy to pay 10$ a month for a great audio conferencing service that always works, has easy sign on,  great sound quality, built-in recording and email\SMS reminders.

An Israeli Cloud on Israeli Gas, in the Sea

an angle on Israeli cloud computing

Israeli Hi-Tech faces many challenges : The Shekel\Dollar rate, the tough IPO market , the rise of India and China, the disappearance of many VC’s and the move from infrastructure markets  to consumer models.

Michael Eisenberg suggested a few very interesting ideas and I believe our new-found Gas might create another one.

The idea is to  build an Israeli Mega public cloud,   in the ocean , using the power from our newly discovered $10B natural  Gas.

Here are a few good arguments:

• Because power is 50% of computing costs, the cost per CPU could be much lower, because of the cheap gas.
• Exporting gas is hard and expensive. Exporting CPU cycles is easy and cheap. The Fiber optics connections are in the ocean, much like the gas.
• It would drive a huge infrastructure industry of start-ups and services , in an area where we already have an advantage.
• It can be a great foundation for Bio-information cluster of large and small companies.
• It  can be a great foundation for a financial software cluster of large and small companies.
• The cost  is not that big and the government can help with initial  funding
• There is a potential to make the international development centers of Microsoft, Cisco,HP and EMC more strategic
• It is simpler than building Data-Centers on ships

If building  the data center in the Mediterranean is too expensive, it can be built cheaply in Acre and boost the city’s economy, providing wealth to its Arab and Jewish citizens. That would be a nice added value.

While I haven’t built the detailed economical model , it does seem like fascinating idea. Anyone cares to push it forward?

A Practical Startup Company Vision Statement

We are using the following document within our company, hopefully implementing as well. It might be interesting or useful for others.

Introduction

Vision statements generally remain unused because they present a collection of good values that can not be translated to real life (see NetFlix’s Reference Guide on Freedom and Responsibility as an interesting exception) . The object of this document is to offer principles for the operation of a Company, examples for their implementation and understanding of situations where we are willing “to pay” in order to stand by these principles.

It is not meant to replace a detailed Company procedure, but to give a principled framework for the company’s activities and to enable candidates to see whether they are interested in joining it and share its principles. This document should be read as a whole since the principles in it complement one another.

The document is constructed as follows:

Principle – clear.

Implementation (i.e.) – an example of a situation in which we adhere to a principle and forego other opportunity.

Exception – since every rule has an exception.

At each cite that the document related to a company’s employee, it means also manager, of course.

The Principles

1. The products and services of the Company must be of such a quality that the Company’s clients will be delighted from the product and service they receive for their money.

The quality of the product will be measured according to this criterion. We believe that in order to achieve this, the product must be of very high quality in many senses.

i.e. To design the Company’s products from the start to a high quality standard, to ensure excellence in testing, usefulness, performance and flexibility for the users. For instance, to forgo extra features in order to favor testability.

Exception – The quality must be focused on the client’s needs and keep a healthy simplicity.

2. The Company’s aim is to attain meaningful income of hundreds millions dollars and profits of at least tens of millions dollars.

i.e. In the long range, the target markets must be large and meaningful. If there is a good opportunity for a small market that can not be enlarged, we should abandon it. We should invest in ordered infrastructures for a Company that wishes to grow and become independent and established and not merely to be sold.

3. The Company’s employees should be satisfied and enjoy their work. The Company should care for their welfare and enrichment.

i.e. Treating the employees as persons and not merely “human resources”. Respecting the employees, affording the possibilities for professional and personal development, investment in guidance. Support the employees in hard times and mutual respect among the employees.

4. The Company must be frugal in its expenditures.

i.e. Modest salaries, sampling and aggressive pricing amongst vendors, creative solutions, consideration of every expenditure. It is important that the atmosphere in the Company, among its employees and vendors will project it.

Exception – it is important that the savings will be not only in the direct financial cost alone but also in the alternative costs of time, personnel or productivity. For instance, there is no sense in obtaining a $100 discount if it entails a month’s delay in the project. We must maintain the difference between frugality on one hand and stinginess and pettiness on the other.

5. The Company must be fair, honest and open.

i.e. Paying vendors on time, paying for all used software programs, letting the employees share information, harmonizing expectations with new employees. We do not accept to the Company an excellent candidate if there are some doubts about his/her honesty and integrity.

6. We work hard, focused and with a broad scope.

Every employee is expected to contribute his/her best time and skills to the Company. The Company will recruit employees that are willing to invest the necessary effort.

i.e. A workday that starts at 9:00 a.m. and continues to, at least, 6:00 p.m. The employees are expected to work diligently in accordance with the character of a start-up company. Focused – a few efficient discussions with a small number of persons, work atmosphere, limited lunches and external prattle meetings, quiet and comfortable work environment. Persons that assume on the subject matter complete responsibility and ownership. There is no feeling of pampering and every employee does what should be done in order to reach the common goal.

7. Excellence, innovation and creativity.

The goal is to lead in every area critical to the Company’s activities. The commitment in not only to be the best in that area, but also to think outside the box – how can things be done in a better fashion, how can things be done differently, and what is really needed and better for the clients and the Company.

i.e. It is better to forgo a financially very good candidate in favor of an excellent candidate that didn’t arrive yet. Not to receive work discounts simply because “everyone is doing it”. Willingness to invest resources in courses, books and time-resources in “games” whose immediate benefits are not obvious.

8. Pluralism, openness, cooperation and teamwork.

The Company will encourage openness among the employees and managers, focused concrete discussions that may be hard but not personal. Information is not to be concealed in order to acquire personal power.

i.e. We recruit employees that are not entirely from the same assembly line, we offer equal opportunity to females or minorities, we make sure to inform our employees, partners and investors with important decisions and current information. Information reaches our employees before it reaches the media. The Company’s procedures and goals are public and open to our employees.

Exception – there is information that is kept secret for personal, legal or commercial reasons.

9. Immediacy and purposefulness.

Success is measured according to the bottom line – whether the goal was reached on time. The aim is to perform each task at the earliest possible moment. What could have been done yesterday, should not be left for tomorrow.

i.e. Responses to e-mails are rapid, stimulating vendors, employees and partners. Giving fast answers and expecting rapid replies. If confronted with a delay, searching  for alternative solutions. Looking to reduce bureaucracy and friction in order to achieve maximal efficiency. The employees’ time is dedicated to reach maximum efficiency.

Exception – we have to ensure that short-range targets should grow from deep and fundamental thinking out of long-range goals.

10. Trust.

The Company’s management model is predicated on the notion that its employees are honest, experienced, capable and diligent. Under these circumstances, the best way to obtain output is a relatively decentralized management model that demands high responsibility but allows a lot of independence to the managed. The model is based on results-dependent control combined with an ability of managers to delve into details in a selective manner in order to help the employees and perform control. The idea is to execute control rather infrequently, but to do it in a most thorough way.

i.e. The manager does not nag the employees and is obliged to help them perform their assignment. Managers in the Company will have the capability to delve into details and understand thoroughly any issue, when needed. The expectation from all persons in the Company is that they can analytically dissect their actions and know how to support their own decisions. Conversely, when a person fails the trust invested in him/her, it must be handled fast and incisively.

Contracting Heaven

A man walks down the street,
He says, Why am I soft in the middle now?
Why am I soft in the middle?
The rest of my life is so hard!

Paul Simon, “You Can Call me Al”

On a previous post I described some “Contracting Nightmares“.

Today, the focus would be on the full half of the glass. The freelancers that killed a dragon for us.

The ground rules are:

1. Hire a person you know well, and consider to be a top performer (“Shakel” in Hebrew). Don’t lower the bar for temps.
2. Hire a trust worthy individual who shares your core values and understands your “language”.
3. Hire him, or her, to work in their field of expertise.
4. Hire “over qualified” contractors, for short-term assignments.

In my experience, only the following combinations work out well

• A Well defined, isolated  project

For example “back-porting open source Japanese fonts library from 2.4 to 2.6″.We had to do it for our SSL-VPN products.It was an ugly job, but somebody has to do it. It was not really related to any domain expertise we had inside the company and it was a non trivial task. On the other hand, it was a pretty well-defined project so the contractor could scope it well.

• Hire a contractor for at least 6 months as an integrated team member

For our GUI team we needed an additional developers(see post) but could not find candidates that met our expectations.

We had three hiring experiments with outside help. The one that works well is outsourced from an external company, but has passed all our usual tests. He was not a “compromise”  in any way. Moreover, he is an expert in .Net ,so training time was less than a month. Since he came from an external company we got a 12 months commitment.As a result the on-boarding costs are smaller, and we still have a lower  financial commitment.

We also examined the company’s background, since in previous attempts we realized the “best” in some companies may not be productive enough in our environment. In other words – contracting is more expensive than in-house, therefore contractors should be just as good as full-time employees , if not better.

One drawback for this method is that the freelancer cannot become an owner of core functionality, since his future is always “at risk”.

The other drawback is that such contractor requires managerial attention,making it suitable to well established teams.

An Over Qualified Beautiful Old Car

• A research and scoping project

In Cloudshare’s very early days (aka as IT Structures) we wanted to have our first paying customer ASAP. Our feeling was that  real customer’s feedback is critical for our success. We only had  two developers at the time, so we hired I.Z to help us with building a virtualized networking architecture.

IZ was an experienced team leader and architect that lead two complex networking projects in his previous roles. He was in between jobs, as he was considering his next career steps (being both a great singer + a talented coder).

We were considering which remote console protocol to use ( VNC\RDP\ICA) and needed objective results showing how well each worked over different latency and packet lost conditions. To our surprise, there was not updated research available.

IZ came out with objective and clear results in a new territory’s for us in which he had  domain expertise. Till this day our remote access performance is one of our key advantages over other solutions in the market.

I trusted him, so we could work on time and materials base. He trusted us that we will not nickel-and-dime him. I always prefer to pay by the hour, as scoping is hard for complicated projects.Both sides feel wrong if the estimate is wrong for a fixed costs project.

To conclude – contracting can work well, but it is not a silver bullet. Chances for success improve if some basic rules are followed.

Related Articles

• 5 Red Flags You Shouldn’t Ignore When Hiring Remote Employees (businessinsider.com)
• Why I Don’t Like Time & Materials Gigs (T&M). (jarrodloidl.blogspot.com)

Americana 2010

Should we talk about the weather?

Should we talk about the government?

1. New Jersey Family Forced To Cover Up “Indecent” Snow Babe. Funny.

Nude Venus in ICE

2. SF police chief backs off Taser plan

3.  Snow from the plane. New York to California.

Snowy America

4. Recession sign – No Greylock party in the RSA conference this year.

5. Recession sign two- “Coyote Point” inn has stopped serving bagels for breakfast. Just toast for the poor guests.

6. I heard that some American companies removed all the text from their user manuals, since they were sued by people who can’t read.

When a nation embraces ignorance, maybe that’s not a good sign (I apologize for insulting the illiterates , but I assume they are not reading my blog).

7. How come 5GB cellular surfing package costs $23 per month in Israel  and  $60 in California? and coverage in Israel is much better.

8. No recession sign

Dog Spa

9. Recession for the tall – Continental offers extra leg room – for $59.

Does it mean a short person like me gets a discount on current prices ?

10. Why do closed captions have a ten  seconds latency after the video and sound?

How do people who really need it get by ?

Closed Captions Latency

11.  America’s Top Psychic Directory. Jet-lag makes me watch infomercials.

You must be kidding

12. No Lawyer is worth $600 per hour.

Beware of Ferris Wheels

I’m  an optimist and was quite surprised to find out that Ferris Wheels actually break down ! It’s amazing what one learns at the gym while working out.

The “Great Wheel” in London broke  for four hours and people were freezing in the cold London evening. It was so cold they took down the fancy drapes.

The interesting business lesson is, the very next day, 11,000 visitors were waiting in line to get back  in. The trick was that the owner gave out five pounds to each passenger who was stuck on the wheel. What a great marketing turnover. According to http://www.measuringworth.com/ these five pounds are worth today£430.28 using the retail price index, or £2,404.60 using average earnings index.

The Great Wheel in London

And if you think the modern wheels are safer, you should read about the “Singapore Flyer“, the world tallest Ferris wheel, just relaunched.

On 23 December 2008, the wheel stopped moving and trapped 173 passengers for about six hours.^[7] The breakdown was caused by a short-circuit and fire in the Flyer’s wheel control room, which cut off the air-conditioning in the wheel. Eleven passengers were evacuated via a sling-like device from a few of the capsules, and those stranded were given food and drink. The wheel restarted nearly seven hours after it had stopped and two people were hospitalized. The Flier was closed indefinitely and an investigation into the cause of the malfunction was launched.

Singapore Flyer