The Simulacrum

What did you lust for when you were tired or turned-on?

2011-12-06T00:33:00.001-08:00

Honestly tell me, have you ever wanted to have sex when you are really tired, have a headache and beat-down? or did you just wanted to lay-dead and sleep? How about aspiring for Rancheros Enchilada (or your favorite dish) when you had fever and tummy pain? If you answered this with "Are you freaking, out of your mind?", you are part of a large group of the sane population.

Now, also tell me. Did you care for how remarkably awesome your bed should be for you to lay-dead and sleep over? Or even cared about whether Katrina Kaif promoted the Crocin you popped in? If your answer is a “No” again, you are rest assured that you confirm with a large group out there.

The point is? Even when your product is remarkably sexy, curvaceous and the most lustful creation that you may have created, if your target segment is tired and beat-down (or in pain), then you fail selling sex. It does not matter if you drop your going-rate (price), engage in longer foreplay (dedicated pre-sales and program structure elements), stay back longer (more for less) etc... Instead, focus on selling them a simple sleep aid or a quick massage if they are tired (deal fatigue or some similar syndrome?) or honestly leave them alone for some time if you are not addressing the pain. Again, If you do not have passionate early adopters (and/or you are not addressing a consumer pain), then do not bother on further expenses on cosmetics, bikinis and fad-diets.

What about when your consumer segment is extremely turned on? (The other extreme lets say. Like when they are pumped on testosterone or probably drunk), do they go choosing between a hot blond versus a brunette bomb? Intuition and trends says, “No”, they do not. They will probably settle down with who ever is the most convenient to access (as anything may do in that state). Even here, overtly sexing up your product in the name of competition may not help. Focusing on just “being available” when needed does the job.

The problem arises when the consumer is in neither of the states and they are sober. This is when they have enough time to haggle on the price, services, duration, special-attention, shape, size, texture, whatever (the value conscious state). This is where you better be “remarkable” or you shall be soon off the streets. Being remarkable need not have to play on the deadly sins theme at all (no you do not have to be a hooker). Just choosing the core business values and doing it well is good enough.

Being remarkable requires your ability to make an impression in a way that the consumer will speak about you in their casual conversations. Something like, “That girl is one of the kindest soul I have come across. I find it cute in a way” or “He is so chivalrous and decent, a breathe of fresh air”. These casual conversations dictates that they remember you for your core-values, as against "Oh, she has the hottest assets you know". Having and maintaing hot assets is far more difficult than being kind, and is not sustainable in the long run. If you are note worthy during a casual conversation on your business values, you have made the right consumer impressions for a long-term organic growth.

Do you know what state your market segment is in? Have you figured out your core principles?

What is the best hyperlocal strategy for India?

2011-12-05T02:27:00.001-08:00

Came across the question here on Pluggd.in forum.

If I take the question at face value, then it is at a very high level. It is almost like asking "What is the best means of transport on land (in India)?" The devil is actually in the details of what we perceive of this question. What do you mean by "best" (quality, cost, value, speed)? What do you mean by "transport" (for people, live stock, fragile goods, general goods)? What will be the volume, frequency of travel? Will it be in a desert? Metaled Road? By-lanes? Across highways? Rough off-road terrain? (Point being made)

Similarly, In this question we have the following variables: 'best', 'strategy', 'hyperlocal' and 'India' which has wide ranging and extremely swinging perceptions. Best for who? (vendor, manufacturer, service provider, consumer...)? What is a threshold to say something is strategic versus operational (from a near term cash-flow perspective? or a long term organic growth perspective?) What is hyperlocal? Which India? (The 4 broad demographics in a tier-1 city? The multitude of BoP class which can only be classified on economics, but gets hairy when we apply cultural context? Aspirants from tier-2, tier-3?...)

Let's specifically say for hyperlocal, the challenge with any discussion around hyperlocal quickly surmounts to what each of us perceive as hyperlocal (and also based on what categories already has or has-not worked in some distant markets). Some agree that it is around a physical boundary (narrow geography) while others vehemently deny a concept of geography involved at all (the theory of nearness to an idea/concept which does not encompass geography is also accepted as hyperlocal).

As an example, let me assume that the flavor of discussion I would like to ‘barely attempt’ to provide my opinion, contains the following key constituents: Narrow-geography based on your immediate current location, Relevance, Individual targeting, Retail and Tier-1 city as a domain (even this is at a very high level).

Then IMO, (at a very aggregate level) India and BRIC style developing nations will be the most equitable places where hyperlocal will thrive in the mid to long term forecasts.

Why? because the heterogeneity of the markets and the amount of fragmentation and decentralization in these nations are high (intuitively, that is, compared to homogeneous, big-box EDLP markets). As a hygiene-argument from a market-category perspective, demand analysis in such markets is way costlier if it has to be done by each SMB on their own. Currently even large well funded (offline retail) conglomerates in India suffer majorly from demand metrics which can significantly improve top-lines when applied well. (This assuming hyperlocal enables significant improvements on demand-chain solutions, which it resoundingly does).

A large part of Indian-metro population is cost conscious markets (specifically around dailies, staples, consumer durables and household services) as I understand it (Note that not all FMCG falls in this group, or beauty and restaurant services is avoided intentionally as that has its own segmented behavior). (Again, what is good for Mrs Khanna is not good for Mr. Iyer).

If you look at the market from the (stated) consumer perspective for the specifically stated categories, then IMO, we can ascertain that finding value (cause one is cost conscious) for what we pay in such heterogeneous markets is extremely painful. and hence, where there is pain (latent or otherwise) there ought to be innovative solutions which shall be reasonably profitable for all players involved.

There are many execution specific questions that pops-up when you generalize such arguments. What is the pain threshold? Will the consumer generally live with the pain in a latent mode until a hyperlocal-solution is offered? or have they already moved on with other alternatives with maximum utility (group-deals are already hyperlocal)? What is the segment size and the number of segments that can be herded with a single platform enabling dynamic customization for similar market segments at minimal cost for the solution-provider? Can it go to the level of relevance and individual targeting over a period of time? Can you apply consumer language for all of the questions and simplify the ‘value find’ use-cases efficiently in near-term? The nature of solution in itself is a huge debate. Add to that the number of edge-devices, maturity of the masses to soak up mobility solutions (or other such profile), technology, market-led innovations etc.. and we can keep this debate on for a long time in vaccum. Justifying an opinion to such interesting debates on a single-post on a blog is really hard without getting excited on every aspect of the problem-space. (Maybe further blogs)

Meanwhile, think through the following hyperlocal use-cases and apply your own perspectives:

Collective collaboration at the community marketplace where vendors offer service-packs (electricians, painters, plumbers...).
Community economics encouraging sustainable & experiential lifestyle involving gaming, community sharing (used items, car pool).
Social engagements involving flash mobs, activism, common goal (as against common interest), social donors.
Enhancing supply-side (sourcing) dynamics with stock and asset moments along with logistics, in-bounding, relevant auto-indents.
Empowering producers (farmers) at the geo-fenced level with info enablers such as price flux, input source, weather, infra...
Enabling 'catchment level' sales structures and program support elements empowering feet-on-street, reducing fiction costs.
Community news, for the community, by the community enabling personalized channels and preferences.
Transport details involving nearness, cost, mode, quality of experience (crowded) and alternatives.
Near-store engagements enabling experience that are relevant for the moment-of-maximum exposure limiting the lead times to zero.

In essence #hyperlocal is an ability to focus on a market of 1 (or few) engaging with relevant info based on personalization in real-time, near-to where you are currently located. Its a nascent problem-space. There are no such thing as best strategies except to intrincically know your markets and to iterate. There are no experts who can predict the outcome of any of the myriad hyperlocal use-cases for India or anywhere globally either. We should therfore be cautious not to throw baby out along with the bath-water.

Are we 'Life' Challenged?

2011-10-13T22:28:00.001-07:00

Regardless of our supreme abilities as mammals, living life seems to be a challenge for most of us. We complicate and procrastinate things like we shall live forever, in the end only to die like we have never lived. Why is it so difficult to lessen the luggage? adding more and more of inanimate desires which slows us down, chokes us and strips us all of true joy.

Jealousy, greed, awry, hatred, lust; these have never seemed to have rejuvenated anything ever, yet we internalize them. Vicious these parasites are, for once they hang on to us, they do deplete life before we know it.

Unconditional love, it seems, has become a poet’s semantic. Hopeless romantics are despised. To slow down to watch the sunset is abstained. Boundless laughter is thought to be frivolous. New-perspectives are sedated and made to fall back in line of the old. Different is feared. To start-up is considered dreadful. Are we programming ourselfs to gravitate towards getting stuck in a surreal state of gloom?

Wondrous encounters with the elements, sunshine on our face, a dip in the serene lake, wholesome fresh fruits, playful and indeterminate conversations with the kids, being impregnate with curiosity, to get up and run; free and wild. Just the sound of these words are so full of life. In order to “one-fine-day” achieve such ecstasy, we seem to abandon the very same, “today”.

Life’s compromises are just that. Compromising on life.

Heavens Will be More Perfect.

2011-10-06T01:51:00.001-07:00

I feel naked. Naked to the fact that death as a milestone does apply to Gods as well. I do not know if it is true, that death is a destination, for, in my culture and religion, I have been fostered to believe that death is just the beginning. The beginning of the new, the beginning of the momentum that you may have set in due course of your life.

I do not have the privilege to claim that I know or understand Steve Jobs. But I have the colossal honor to have lived in his times and to be impacted with sheer excellence of his legacy. The legacy for me is not the products that he marshalled, nor the business that he built, nor the empire that he reigned on.

The legacy, for me, is something more astute to the fact that being a fearless heretic of an idea, an idea that strongly resounds with the “why” of existence more than any other ruminations, is the most potent wisdom that empowers paradigm shifting creations.

A man who was given birth only to get adopted, who dropped out of college at 17 post self interrogation of the value for such expensive education paid through the savings of working class parents, to have slept on the floor of friend's dorm and to have been fed by the deposits of coke bottles when there was no money for food, who walked 7 miles once a week for one good meal. For such a man to be in romance with aesthetics of life is something astonishing, but not unimaginable.

What is unimaginable is the passion with which such aesthetics was pursued, unsettling to anything sub-optimal, relentless in the pursuit of the pristine, fearless in his advocacy of what should-be than what was assumed necessary, never bowing down to anything mediocre. Feared, respected, revered, worshipped. For someone who even death, it seems, asked permission 6 years back.

Uncompromising and resolute towards perfection. A perfect life, a perfect death and a symmetrically perfect legacy. iSalute.

What are you waiting for?

2011-09-28T10:00:00.001-07:00

So, said the reporter, "Excuse me... What's your opinion on the meat shortage?" to a nearby standing clique which had an American, a Russian, a Chinese and an Israeli. Now, the ability to perceive the reporter's question was preceded with the idioms and metaphors of the culture and economic context of the individuals who were from their respective countries, as usual.

- "What's a Shortage?" queried the American. In the land of excess this was an alien word.

- "What's meat?" quizzed the Russian, for, he had not heard of any for a long time.

- "What's an Opinion?" wondered the Chinese. As much as what had been the rule of the land.

- "What's an Excuse?" inquired the Israeli. That's something they were never used to !

Now, there was an Indian passing by who happened to overhear the Reporters interrogation. *The Indian understood the question perfectly well*.

The point is? Well we Indians as startups and Innovators happens to be in the context & economy that allows us to be blessed to understand all the connotations of that question. Yet, we must hope that it would be a blessing, the day we stop understanding "excuses". This shall probably be the day we accelerate the process of Innovation.

Whats your execuse to not start-up? or to not push the boundaries? or to not stop whining about lack of eco-system? or...

(Attribution: this context is a adaptaion of Mike Leigh's Jewish play "Two Thousand Years")

Mobile Apps Developer? Ad Monetization? Really?

2011-09-26T05:37:00.001-07:00

There are so many mobile app developers nowadays. It is getting hard to keep track of what exactly each of us do. Whenever you veer into the Business and Revenue model discussions with some of them (us), you get to hear awesome things about Angry Birds! The pitch is to follow the Angry Birds revenue model. What is that you might wonder? Oh the Ad Monetization based Revenue models you are pitched.

But have you explored what App you would like to develop? What is the consumer and target groups you are going after? The utilities you enable for the target group? About other revenue opportunities? As soon as these questions flow, it sometimes look like I catapulted a Black-Bird that explodes on contact at them, and the conversations flow like, Oh, we 'thought' about it, we have tried it 'once'! those are pretty 'hard' things to do!

Thought about it? Tried it Once? Hard to do? I am gasping for fresh air at this moment.

You know, there is absolutely nothing wrong in aspiring on a good Ad monetization revenue model (even if you are not benchmarking Angry Birds here). I know several great Ad monetization businesses which are doing decent top-lines (some of them are good friends and well respected). So, before you break it down, its important to know what other Business Models exists.

At the very high level, the following are some broad brush strokes mobile app business models :

Enable mobile channel play for existing web channels which are non-ads based (Deals, Events, News).
Enable mobile channel play for Business LOBs creating new media asset (Leads, Branding, Merchandising).
Own a focused, curated content (created through your app), and charge for the access to assets (POI, Metrics, API).
Enablement of mobile mediation layers controlling access to existing enterprise services. (Enterprise Mobility).
Mobile device management and control platforms. (Enterprise Device Management).
Develop apps for other business as a service. (Software Services).
Develop compelling utility/game apps which users are willing to pay (Pay per download).
Develop compelling utility/game which are free (Ad monetization).

The Revenue models can be categorized as follows:

Not charging the consumer but charging a Business: (Free for consumer)

Charge for Action (Number of leads filled, Deals closed, Events booked, Close loop).
Charge for Impression, Click Through Rates (Brand content disseminated, Click on assortments).
Charge for Service to develop (Fixed Cost, Time & Material, Hybrid).
Charge the Developer or Enterprise for Usage (Charge for API calls, charge for throttled use of mediation layers).
Earn through Promotions (Ad monetization). (This is diff from 'charging' for Impression where you control the sourcing)

Directly charge a consumer:

Charge for Commodity (One time download fee)
Subscription Charge for Access (Subscription for monthly news, Stock tickers, Domain content)
The above can have a variant of free for limited features, different monthly fee for different capabilities.

Since we started on Angry Birds Ad monetization as benchmark (for a specific Business/Revenue model combinantion), you should know some high-level metrics of Angry Birds (as I write) if you are aspiring to be one. Angry Birds have in excess of 350 Million downloads (across all platforms) and has 200 Million minutes of play time everyday (that's equal to 380 years of game time every day). Also, it is not just one game anymore. It is more a game platform with series of games for every season (Halloween, Christmas), along with extension packs and Themes for movies (Rio) and Ports (Magic for Nokia). Angry Birds is rumored to have taken in excess of 50+ release attempts before it struck the exact game psychology with its adopters. They also have a paid version, where 12+ Million copies have been purchased on iOS.

Then, Of-course, you were kidding when you mentioned Angry Birds. Yeah, I know that. in that case, lets focus on the people who are making a decent living off Ad-Monetization, shall we. Lets take an analogy here, there are so many bloggers who are making a decent living off their blogs cause they are experts in what they write and have a focused audience. So when you say you would like to start a blog to earn money, be very focused on the audience. Even for mobile apps, audience and utility matters. Who are your audience? demography (age profile..)? psychography (likes, tastes...)? What app are you developing (Game, Lifestyle, Info, Travel, Shopping)? What is the experience you are targeting (Lean-Back, Lean-Forward) etc.. Once you have figured this, you need to worry about:

Hardware, Software, Device (and experience) fragmentation.
Compelling UX, Addictive Visuals, Theatrical Experience.
Content Refresh Rates (or game levels).
Challenges and Puzzles for the right psyche and device profile.
Context Awareness (Location Based, Event based...)
Seasonal, Theme or Memorabilia (Christmas, Disney, Harry Potter)

Next, you have to worry about the metrics of the mediation layer. In other words who shall give me ads? what shall I earn? when do i get paid etc.. Some of the Ad and usage metrics that you have to be aware of are as follows:

Dwell Time: The average time spent by the user daily.
Frequency: The number of times the consumer uses the app.
Time lags: The time between frequent visits (this can taper down).
Shelf Life (Half-life): The time that a app can keep a consumer excited, once a half-life is reached, the usage tappers down.
Impressions: Number of times a ad is served.
CPM: Cost per Mille of the ad impression.
Clicks: Number of people clicking on a served impression.
CTR: Click through rates, number of clicks by the number of impressions served.
Global Fill Rates: This is a percentage metric representing the inventory of ads that is served.
Funnel Fill Ratio: Number of new users, acquired users, median users, half-lifed users that are in your funnel.
Viral Coefficient: This is a fancy ratio, but in general this means, how many of your current users referenced new users.
Relevancy Metric: Is it in native language? Is it specific to a locale? is it specific to a demography? psychography?

Notice that you earn less money by serving impressions and more for covering clicks (clicks are considered as actions and are equivalent to leads) So, how do you increase your impressions and clicks? This is exactly where the rubber meets the road friends. If you do not know your audience profile, or track the usage metrics of your app, then, you are in complete doldrums here. You need to have a good analytical dashboard in the backend or rely on the one that your ad mediator provide (like InMobi or AdMobs).

Assuming you have a compelling App which has a addictive user Interface you 'still' need to ponder on:

Is this a lean-back app driving dwell times but is not so much focused about frequency?
Is it a lean-forward app relying much on recency and frequency?
Do you uderstand the events that produce the time lags?
How about your Relevance strategy? What are your ad promotion strategy based on such relevancy?
Do you serve text ads versus graphics?
What about the Global Fill Rates? Are the house ads (free ads) eating up your ad inventory?
Who controls the fill rates (you or the mediator)?
What is the seasonal cost of such inventory (Oh, these rates fluctuates beyond anyone’s understanding).

Just while you start interacting and getting a handle of some of the above, your half-life hits and usage tapers down, now you start worrying about Funnel fills, refresh rates & median CTRs for retention (through new versions, new levels, extension packs). What about virality? marketing budget to go after prime adopters? Yeah, I can go on, but by now you get the point right. If you are throwing more than one app out there to spread the bets on the portfolio, then you have to do all of the above for every app if you need a decent top-line. But then again, you can blindly just throw apps out there not worrying of anything and hope to make some revenues as well (Good luck if you are one of them).

Just in case if you think you are in the Ad monetization business because it is 'Easy'. Think through again. Talk to established players and understand their metrics. Get a good product mentor on board. Most importantly be ready for a wild experience. Oh do not forget to have fun in the process. Cheers :)

Social Graph: The Philosophy of Existence.

2011-09-22T12:01:00.002-07:00

The first post of this social-graph series explained the scheme of things and the second post looked at the broad types of activities one can perform over the graph and the experiences that are possible using edge devices.

In this post, I ponder (philosophically) on the nature and the context of the social graph from the perspective of why it matters or why people participate.

Its been found that even bacteria-infecting viruses (called phages) do communicate through chemical markers (viral gene expressions based on genomes and proteins) in the host system to make collective decisions to either remain in a latent state or to attack the host. The point is? Well, the point is that life, it seems, is inherently and implicitly social, both by nature and context (voluntarily and involuntarily).

In-fact, i have a amateur-theory that all organisms are hardwired by nature to engage with other organisms in order to get fitter in the cycle of evolution. The fitness is based on the 'access' and evolution of 'shared' knowledge (of a particular gene state in a host, or the economic output of a country, or any other esoteric inter-galactic protocol).

Given that humans are organisms blessed with superior interaction skills, our incentives are primarily driven by engaging with each other, often emphatically, based on many different 'intents of life'. The intents of life can be shaped up from a functional context as understood from previous posts or also based on 'tastes' and 'interests'. Note that I am generalizing all intentions that forms different context and still call them as social-graphs . In many places, people have coined many other terms such as interest-graph or taste-graphs and have provided interesting connotations for these topologies (I will provide my opinions on this in future posts). For me, simply put, if Individuals are socially networking, then its a social-graph. The rest of it is a signalling discussion around the context. IMO, the intents only bind the domain of discourse of the graph establishing a context.

To illustrate, If I am interested in bird watching, I would love to engage with fellow bird watchers to exchange notes, discuss, and learn about this domain. Now, will I choose to search for others sharing similar interest over my friends network (Facebook, Twitter etc..), or will I form a separate group, or will I move to a separate social-graph for bird watchers is again a discussion of semantics. Lets for a moment assume that there is a bird-watchers fan-page or a group as part of a established social network (say Facebook) and call it a platform.

Every time people engage with each other over a topic of interest over a domain (on a platform), they refine the knowledge-base within that domain and take it to the next level (evolution). Note that in the process of engagement, I may also want to date, hang-out and party with people who are like minded. The pleasure modules in the brain is incentivized in this 'interest seeking' behavior to feel good about engaging with other humans on the topic of interest that are close to our heart(?). In effect, when we say we engage socially, we involve the faculties of both Cognition (understand, learn) and Psyche (perceive, emote) to derive conclusions of such engagements. it is almost a driver of life, that we voluntarily or in-voluntarily participate in social-graphs then.

Given the connectedness of the digital world, it became quickly obvious that establishing context specific platforms over the Internet (the digital nervous system) to enable such interactions is a natural hit. As hypothesized, it becomes natural for us humans to gravitate towards such platforms which enables access to others so as to share our life's intent enriching our experiences.

The nature of such engagements happens over different styles of communication as follows:

Synchronous or Asynchronous (relevant based on the flow of info and immediacy)
Closed or Open ended (status versus questions)
Private or Public (Inside a closed virtual room or on a wall)
Unicasted or Broadcasted (one-to-one or group messages)
Organized or Un-organized (hashed, tagged, categorized)
Structured or Loose (Text heavy or template based)
Animated or Bland (Exchange of Narratives, Theatricals and Videos)
Location specific or Global (My locality, state, country...)
Discovery versus Recovery (Find something new versus fetch something I know)

Again, it has to be noted that the styles of engagements are chosen primarily based on the combinatorics of dimensions that we have understood in the past posts such as the functional domains, the edge-device profiles, the device experiences (upright, lean-back, lean-forward) and also on the intent of accessing or sharing information and the conclusions that are sought for such engagements. So, again, not all engagement styles are suitable for a given combination of device-profile, device-experience, environments and engagement intents. (much to ponder and innovate here BTW)

Now, then, it starts getting interesting to study and analyze the usage profiles and behavior of humans (to access and share info) through such bounded context of different social-graphs. The intents that are captured, the knowledge disseminated, diffused, built or contained in such graphs becomes extremely important to push the bounds of human evolution a bit further. Of-course such knowledge gets extremely enticing to all practitioners from the functional domain, be it marketers, sellers, buyers, recruiters or also to linguists, sociologists, politicians, economists, logicians, biologists etc...

We can conclude that Social graphs do matter and it is natutral for people to participate. And, what about the evolution? The reach and relevance, unprecedented. The potential and imagination, unbounded.

Social Graph : Access, Activities, Environment & Experiences

2011-09-21T09:27:00.000-07:00

In continuation to the previous post : The Scheme of things which may have set the base to understand the usage of terms such as Identity, Relation, Context, Functional Domains, Functions, State, Reputation and Edge Devices, I intend to work towards the functions of the Access points (Edge devices), Nature of Activities and Environment of use of the social-graph in this post.

Edge Devices
To quickly summarize, edge devices are the access points or tools that are used to communicate with the digital world, be it world wide web or the social graphs. Broadly there are 3 types of edge devices today being PCs/Laptops, Tablets and Mobile. Each device has advantages and disadvantages around form factor, resolution, input functions (keyboard), nearness (always with me?), bandwidth, processing capacity, memory etc.

Nature of Activities
Lets now broadly categorize the 'nature' of activities that a user performs over a social graph, as follows:

Heavy text content creation/updates (Initiation as well as operational)
Media content updates
Passive Information Consumption
Active Information Consumption
Interaction

Heavy text content creation: During the initiation (or the first time use of the graph) there may be Identity creation, profile updates and other such social-graph-context specific info that needs to be updated. Depending on the context of the graph, these activities may include extraction and load process (Ex:Bill-of-material) into the graph as well. Also on a ongoing basis, you may change, update, add several stateful information that is relevant to the context.

Media content updates: These can be updates of Audio, Video, Pics or other relevant media specific to context.

Passive info consumption: User may visit the social graph site based on events like a notification (friend posted something on the wall) to only consume that portion of information. Or, the user may in general check the news-feed to be in-touch with activities and statues of others through a quick browse.

Active info consumption: User actively searches for a specific profile in the hope of hire (Linkedin), or a product search to find the seller (eBay) etc. There is a active and intense engagement of user to retrieve info either in the form of discovery (looking for something) or recovery (recall what i know already exists). This requires users attention to perform the activity with satisfaction.

Interaction: Interaction may involve, chatting, tagging, commenting, likes, purchase, filling lead forms, quotations etc... (diff function across diff domains of social graph)

Environment
The most important aspect of the access points are its environment.

- PCs/laptops are typically fixed point devices used from home or work. They are fully loaded across all capabilities including larger screen, ergonomic keyboard, powerful CPU, memory, fat-pipe (bandwidth) etc. Users typically sit-upright with full attention to perform a task when working with PC. There is limited distraction and ambient noise when user works on a PC. Lets call this the sit-upright posture. Lets say the combination of the device capability and the posture is called as a experience. Typically the consumer can perform all activities (#1-#5) with absolute ease during this experience.

- Next, Tablets are mobility devices meant to be carried around and used in environments such as conference, work, shop-floor, home, events etc. The device capabilities are typically built around info consumption with a focus towards, touch inputs, relative mid sized screens (compared to PCs) and a good processing power for gaming. Now these devices are built to be used in a relaxed manner, leaning-back on a sofa, reading a digital book, playing angry birds, taking quick short notes etc. Lets call this the lean-back posture. IMO the functions that are mostly apt for a lean-back experience is media-content-updates, passive info consumption, and some amount of active info consumption, and interactions. Not all functions of active info consumption may provide maximum utility for a lean-back experience. Also heavy text inputs or extraction-load processes are a complete no.

- Finally, Mobile phones are extreme mobility devices which have the smallest form factor, limited screen size, not so powerful processor etc. The most important aspect of this device is its always-on, always-with-me profile. Also the environments in which they are used are far wider in range than the above two device profiles. Lets hypothesize that a user who has a PC + Phone, would mostly switch to PC when in home or work. (I will keep the discussion on users who never have a PC but only a phone, separate from this post). This eliminates home/work as the major usage time of phone as a access point to engage with social graphs sites. Given this assumption, phones, almost overlap with all environments that of Tablets.

Mobiles are also majorly used in shopping areas, airports, cafes. Typically due to the limited form factor of the mobile, and the amount of ambient noise, distraction, grab-of-attention etc that happens to engage the user away from the phone, the utility of the phone is primarily built to be able to be operated with minimal attention span of the user and maybe single handedly. User typically leans-foward, quickly consumes info and gets engaged back in his environment. So lets call this the Lean-forward experience.

Lets extend the context of the mobile phone profiles a bit. There are feature phones (Not so powerful, limited capability devices) and there are smart phones (A mini Tablet lets say). So the utility of each of this differs based on input capabilities as well as info consumption (based on processing power). Assuming that mobiles are used in a highly distracting environments (unless in a cafe), the nature of activities that you may perform on a mobile gets further limited to a quick status update (about where you are, what you are doing) or passive info consumption. Also only some amount of media content updates and interaction can be performed. Performing Active info seek, or heavy operational text inputs are almost bad experience from the utility-value-grid perspective here.

So the users usage behavior on accessing specific functions of the social-graph is completely dependent on the profile capabilities of the Edge-device, Environment, and the Posture (Upright, Lean-Back, Lean-forward). In effect, all these dimensions combined, drives the experience of the user which limits the maximum utility of a social-graph function for a specific combination of these dimensions.

We can conclude that the way we experience the social graph significantly differs based on the combinatorics as explained.

Here-in lies a premise to focus on either incremental-innovation to build on top of the permissible utilities of a specific experience (mobile-lean-forward) or work towards disruptive innovation on making the pain-points go away (speech-to-text for heavy input processing). That said, it is difficult to change the environment of use or the limited attention a user gets for an experience such as mobile-lean-forward.

Will leave you for now on the thoughts of how applications and domain specific social-graphs can evolve particularly around a mobile-lean-forward experience, as majority of the graph utilities are yet to emerge in this segment...

Social Graph : The Scheme of Things

2011-09-21T05:46:00.000-07:00

I was off-late wondering on the nature of social graphs in general and what maybe the functions and context of use of these graphs. Social graphs being the root of many business and scientific discussions, requires a common scheme of things that are used in well defined way in the conversations to broadly make sense.

I am breaking down my thoughts into series of posts to manage the size.

In this series, I thought I can take a first-cut of my understanding and opinions on what this scheme can be (in a common business like language) and represent a preamble to my future posts based on social graphs.

Probably the following distinct scheme of things are obvious at a higher level during social graph discussions.

Individuals who participate in a social graph. (Identity)
Relationships between the individuals. (Relation)
The Domain and its functions. (Context)
The standing of an Individual within a social graph based on the values, behavior and outcomes of his activities. (State, Reputation)
The tools that are used to communicate. (Edge Device)

Lets get the academic definitions out of the way

Social: refers to the interaction of organisms with other organisms and to their collective co-existence, irrespective of whether they are aware of it or not, and irrespective of whether the interaction is voluntary or involuntary

Social Graph: A graph that is constructed by connecting the organisms to each other forming relationships and 'How' they are related.

Defining each of these schemes further

Identity: Each individual will have to establish a unique ID to distinguish herself across other within a graph. This can be email, TwitterID, FacebookID etc..

Relation: The nature or type of relationship you hold in real life, such as, employee, employer, friend, spouse, buyer, seller etc..

Context (Functional Domain): A social graph can be formed between humans relative to many functional domains. Which means, it does not necessarily have to be between a type of relationship such as friends (friendship being a functional domain). You can construct a social graph of organized sellers in a market place relatively connecting with each other to create the sell side dynamics like price control, logistics, bill-of-material, turns ratio, availability etc. You can also have a social graph between organized buyers in a market place connecting with each other enabling the buy side dynamics. Then another graph having participants from a work hierarchy (linkedin), another between a seller & a (adhoc) buyer in a market place (eBay et al). It can be between structured sellers (Amazon, eCom...), it can be for a specific community of aggregators (who are not producers or consumers) such as co-op societies. You get the idea of functional domain specific social-graphs by now.

Functions: Note that the relationship drawn between two people connected in a social graph has certain functions that are enabled to make sense within the context of that domain. In Facebook for example, you chat between friends, you are more casual in your status, you poke friends, upload family photos and comment on them etc... But when you get to Linkedin, you are more focused on getting connected to people from your industry, hiring, marketing, selling, defining job responsibilities accurately, enable recommendations etc. These are the functions you perform over the domain specific graph to engage meaningfully.

State: You seamlessly cut across all the functional domains of different social-graph that you belong to. You as a individual know your personal state and verify your state against activities across different graphs. You also update your residual state which is very specific to the functional domain of the graph. For sake of brevity, each graph carries only enough context and state to play within the domain boundaries of the graph. To illustrate, you may update Facebook that you just became a father (and your demographic profile in FB). You may update your new promotion and brief job responsibilities on Linkedin. As a Individual, you are aware of both these states, but as LinkedIn or FB the graph only knows what it needs to know.

Reputation: Based on your state, activities and interactions in the social graph, you manage to hold a reputation as an Individual within the functional domain. In Facebook maybe you are known to be overtly quite, but extremely chatty when it comes to Twitter. You may be a super connector when it comes to LinkedIn, a top commentator when it comes to Disqus. Reputations are based on likes, rating (and other esoteric parameters such as relationship weights based on frequency, recency, reputation of people you have connected to etc... PeerIndex and Klout are examples to manage such reputation). Also graphs themselves internally manage reputation based on internal algorithms which may be used to show you news-feeds of friends who you interact the most etc.

Edge Devices: There are many types of devices that can be used to access social networks today. PCs, Tablets and Mobiles being the broad category. Each device has advantages and disadvantages around form factor, resolution, input functions (keyboard), nearness (always with me?), bandwidth, processing capacity, memory etc. Assuming there is connectivity for the device to access the graph, the functions of the graph that you would access is based on the context of the graph and the capability of the device to allow a reasonable experience for the consumer to engage with the graph.

Given this scheme of things, it probably becomes meaningful to have reasonable discussion about a social graph in any functional domain without getting overtly confused on the terms used. In the next post I will talk more on the edge devices and its functions which sets the base to understand the pivots of utilities when the edge device capability amplifies or hinders a social graph function.

Indian VCs are Dumb. Really?

2011-06-28T00:43:00.000-07:00

Indian VCs are dumb f**ks. They do not have the balls or the brains to invest in Indian startups which can become the next Google, Facebook or Twitter !! If I can get a rupee for every time I hear these sentiments I will be reasonably rich soon.

The argument goes that VCs and Angels in US have invested in such start-ups even while revenue models have not been obvious. Fair. VCs in US invested in anything that had a 'dot' in a dot-com during the boom as well!!! What happened to all those companies?? This does not showcase that American VCs have bigger balls or better brains. It only tells that the supply and demand (of surplus funds) in that part of the economy (for that period of time) is different. India is NOT America or Israel or Bangladesh or Taiwan or China or...

Economy across countries differ. Heck, Economy in the same country across timelines differ!! Its not the same USA that it is now when it was 6years back. Reflect on the spectacular failures the so called awesome investors in USA has caused through prescient acquisition of sub-prime mortgages inflating the markets. The world economy nearly crashed.

Money is only a very small part of the equation of why a Google or a Facebook is what it is. If money and smart entrepreneurs alone can have spectacular home runs, then the world will be a different place. How about luck? Does that play a part? We hear about these start-ups only because they are successful. What about all of the ones which got funded in US by the US investors (which had super awesome teams) and failed? Should we really have such retro-rational arguments on successful businesses which is across a geography and from a different time?

What if Google had messed it up? Huh? Would you blame the VC then or the Entrepreneur?

IMO The most important aspect for any start-up to 'survive' is finding traction with early adopters in the right markets. And subsequently for a start-up to 'succeed' they need to cross the chasm to find early majority.

Finding early adopters and early majority is NOT a function of getting funded. A market has many constraints ranging from economics, culture, social-influences, demographics, psychographics, clusters, niches, segments, categories, attribute ownership etc. The Diffusion of innovation and business is completely different for every possible combination of the above dynamics. The rate of acceptance or adoption of a 'utility' differ significantly for these combinations across industry verticals.

Among the stated dynamics, culture and social-influences play a priority. Tangential to this debate let us ask the hard questions first. Why do Indians throw garbage on the roadside? Why do we spit on the walls? Why do we pee outside on the wall of the public toilets? Why do we kill baby girls? (I know you may be nodding your head in disbelief how these questions slipped by in this article!!) Well I will say that you just missed the clue train then.

How many of you have used a really good hyper-local news and deal app that a good friend of mine has built? How many of you have participated in making it viral? How about a great crowd-sourced testing platform from India that another good friend has built? How about a really cool platform for secondary markets for used-items? How about a book and content publishing platform? You would know the names only if you are early adopters. And hell NO, early adopters are NOT marketed to. There is no marketing budgets for early adopters (Not even in your beloved USofA. There were no marketing budgets for the big three sexy companies you quote in the debates as well).

I do not have anything against US VCs nor am I in bed with the Indian VCs. I feel all VCs are opportunists. They are all the same. They have to make money for their LPs. Yes some are smart others are not. The point is, it is not specific to any geography or time or color of the skin or the size of their you know what.

Indian start-ups fail or succeed because of Indians. Period. (I am an Indian entrepreneur in India building a India specific platform for Indian markets).

I know most of you will not like this post and you will have intelligent arguments supporting your claim. I also know that if you get funded when you do not understand market economics, then, not only will you NOT give us a winning sixer, but you will also mess the case for the other deserving ones. Think through that, Arighty? Peace...

Principles of Failure

2011-06-25T22:27:00.000-07:00

Of course you have a great idea. Sure you are a visionary. No question you have battled hard to be where you are. So was Van Gogh or Nikola Tesla.

Did you get rejected by your Customer? Market or your Investor? Hmmm, they must be dumb then. Customers are not able to identify the latent problem that is lurking. How lame. Markets do not understand the utility you provide. How immature. Investors do not comprehend the scale you shall bring. How myopic. Sounds familiar? (Note the saracasm, please)

You may strongly believe all of the above as true !! That is besides the point for this post.

Rejections are inevitable. I am not an expert, but Economics (Macro or Micro) is the study of scarcity (due to existence of scarcity) isn't it?

Very broadly stated:
- Customers cannot buy from everyone.
- Markets cannot always accommodate everything having a utility (due to alternatives and irrationality that is pervasive)
- Investors cannot invest in every great idea.

Also, markets and economies are not equal across geographies (and even across time) so basing your rationality across markets or across time may not help.

Some of the good leaders I have studied or have had pleasure to work with, have one strong trait in common: They demonstrate tremendous maturity in handling rejections.

As an entrepreneur, nothing is more handy a tool than managing failures and rejections. This helps in conserving entrepreneurial-energy and dip back into the pool of irrational exuberance or optimism as some call.

Neither Van Gogh nor Tesla gave up in the face of failures to the end (They were in love with what they did). Yes its unfortunate that they are posthumously famous. Its (grossly) unfortunate 5 billion of the worlds population (across geographies, not that it matters) could not identify with them in their time.

Aside, principally though, your ability to resolve forward in the face of rejections has a higher probability of positive impact on your eco-system, than your human instinct to share experiences by considering your markets, customers or investors as lame (even if they happen to be lame) and giving up. [If your failures have had a impact or a burn-out due to which you cannot move forward, then that's a different matter which is valid.]

Also, consider the fact that maybe, (just a little maybe) that the markets, customers and investors are probably not that lame. Then, isn't it important to avoid the rut of ignorance (arrogance?) not seeing holes in your own proposition?

Does handling rejections teach you to sharpen your tool better? What is your opinion?

What is your Story?

2011-06-22T23:20:00.000-07:00

First, check this video out :

You had no clue what he was singing right? (Unless of course you are a Korean or understand the language). Did the song still move you? I bet it did.

If you had just jumped right into the song sans the story, would it have moved you enough? captured the same interest? Maybe... But the song within the context of the story is a sure shot winner.

Lesson? A good story which people can 'emote' with, almost always sets a strong context for any performance. Be it a talent show, brand, product or a start-up. It does not have to be a sad story. It does not have to be a powerful story either. What a story does is establish trust right from the word go. Empathy is the shortest route to trust.

Isn't 'Trust' the most important faculty when you social-proof? It seems to be the strongest bond that carries people, product, brand and companies through rough weather.

Stories about people who built the product, the journey, country of origin, culture, happy moments shared, rough moments endured, individual or group struggles and victories are all seemingly the levers that can be very humbly sprinkled into the context. Being honest and sincere about it will surely set the tone, intonation, cadence and the 'pitch' right.

It helps to be inclusive. Involve your customers into the story. Make them part of your story, their struggles, their victories, their pains and joys told from the perspective of your brand.

This is what the Experience Economy should be all about. Isn't it?

What's your opinion?

Value Erosion - Prisoner's Dilemma & Defections

2011-06-03T23:51:00.000-07:00

My previous blog did evoke some interesting conversations on pros-cons on the Group Buying models. Mostly the argument for Pro group buying almost always veered towards group buying being a great model for service which has high-fixed cost and excess capacity. The examples almost always ended with Travel (Airline) and Hotel Industry and extrapolating that to SMBs!

To recap: High-Fixed cost services which has excess capacity (after recovering its fixed cost) tends to gain from every $ they earn for the same session (Airplane, Yoga Studio etc..) as the cost of acquisition is not significant there after. The Key here is "post fixed cost recovery" and "same session". This is a very Rational Viewpoint. The flipside is, behavioral economics, human beings and market dynamics are not Rational!

Lets take a Yoga Studio as in one of the examples. If the fixed costs were $2000 (lets say) per month (Lets call this a monthly session) and you have enough students who have already covered your cost. Now every additional student (assuming you have excess capacity) you add to the same session should be profitable for the Yoga instructor correct? Rationally Correct.

The challenge with this debate is exactly what the "all customer defects" scenario as per the Prisoner's dilemma presents. When the initial paying customers gets a wind of what you do to fill the remaining capacity of the Studio, they start defecting to wait for that Deal... and this catches on (is catching on). Airline and similar (Hotel) industry is only very few industry which can afford to operate in this model as people are 'pressed' to fly and cannot always wait for a deal. For everything else (which is not pressing), they will wait for a deal. This is already happening in the SMB markets in volumes as we speak. Regular paying customers are defecting to wait for deals. Also, they would now not mind to switch loyalty off the Merchants if someone else gives a deal.

We must exercise caution while extrapolating such models to SMBs right off. Unlike airline industry, the 'long tail' of similar merchants (Yoga, Cafe, Saloon...) is relatively much voluminous in a given city than a consolidated few flight schedules between two cities across airline players. which means, there will mostly always be a deal for me to defect.

When most customer's defect, then, the prisoner's dilemma feeds on itself to erode value out of the system. Talk to the SMBs to feel their pain and validate this.

A key metric on the current deal-seekers for Merchants now includes in excess of 50% (median) and as high as 90% in some formats of "existing" customers biting the deal! Did you add additional footfalls then? or are you defecting your current paying customers?

When most of them defect, the SMB will now be fully dependent on the likes of Groupon for filling seats to recover their high-fixed cost. Great if you are Groupon, Living Social, Google Offers..., Epic win if you are a Consumer, Sucks if you are a SMB. You know what SMBs will do if this happens right? (and what will be left of the business model.)

Bottom-line: The current avatar of group buying is just not a proven model yet and needs to focus on a whole lot of market dynamics to assure a equilibrium before we can claim that it works.

Group Value, Where Art Thou?

2011-06-02T22:53:00.000-07:00

There are exciting theories and debates on group buying, thanks to the promised land prescribed by Groupon who made Group buying the current rock-star of the fledgling US markets (post, recent down-turns that is). (Is it adding to inflation or aiding? Hmmm, tangentially different debate.) With today's S-1 filing, the heat (usually which allows a hot air balloon to raise) seems to be turned on. Don't get me wrong. Hot air balloons are the greatest invention which allowed mankind to fly. Just that its not a preferred mode of transport since the Heidenburg disaster. So is Group buying a proven model yet?

Quick recap: Retailers usually break down their sales life cycle largely into Acquisition, Retention and Servicing. The budgets for ATL (Above the line), deep-discounts and loss-leader line of products typically falls in the Acquisition cycles. The loyalty and BTL (Below the line) promotions fall into the Retention bucket. Upgrades and up-sell falls into the Servicing bucket. Smart Retailers do not aggregate a single promotional budget to track their consumer micro-segments. Instead, they spend their research and sampling $$ on new customers, marketing $$ on Silver profiles, retention $$ on Gold profiles and the Service $$ on Platinum profiles. Not all these budgets are equal. Most important of all, The ROI of each of these spends are significantly different for each micro-segment. Also, retailers trade-up during boom cycles and trade-down during bust-cycles (So the budget varies).

Where does group-buying fall into? Clearly the Acquisition bucket (which is NOT a capex spend but a marketing cost). The Acquisition is the big funnel that marketers fill in order to convert the footfalls towards the Retention bucket. One must make sure that they fill quality leads which aids in healthy conversion helping them move the leads to the Retention bucket. What are quality leads? Are consistent deal-seekers quality leads? Are Bargain hunters quality leads? Is the cumulative conversion index per consumption-segment positive? These are some of the questions which a optimized, organized retailer such as GAP, Walmart etc. asks. Are these measures different for a SMB retailer? I would argue that they are even more applicable for a SMB...

When does one deep-discount? typically, when you have end-of-line sale, surplus capacity whose account has gone into sunken cost, poor-utilization rates (Ex: Hotel Rooms), Expiring shelf-life, to clear product line whose GMROII is not positive, Projected increase in policy costs (Taxation changes on holding inventory), or adding large sampling to acquire new customer base for virgin markets or virgin products. (I may have missed few others for sake of brevity). Most of the above is a provisional measure for retailers who are operating in a larger scale of economy. What are the premise for SMBs then? In my umpteen conversations with the SMBs, deep-discounting occurs primarily to add leads to their funnel in the hope that the consumer shall experience the "Unique product offering, Service and Ambiance" which is a differentiation for the SMB to exist. Now this sounds like a virgin offering. So it clearly is for "Sampling" then for the SMBs.

Now, the Cost of Consumer Acquisition (CCA) should be paying off on the long run through two different measures that adds up.
1) NPV or the Net Present Value of the Consumer.
2) LTV or the Life Time Value of the Consumer.

The NPV for virgin footfalls does not exist. Which leaves the LTV. This materializes only after the conversion. Remember that the CCA of 'N' who are added to the funnel is used in determining the 'M' conversions and their LTV. Meaning the CCA cost of adding 100 virgin footfalls must be offset by the LTV of the 5 who gets converted (5% as a example).

The CCA and LTV are very segment specific (Beauty & Massage parlours, Small Eateries & Restaurants, Boutique Hotels, Convenience Stores etc..). The conversions are also segment specific. Not only are they segment specific, the country of operation, the consumer behavioral context, culture and current economy makes a huge difference in any of these measures.

As an example: A country like USA where people leave a tip in the Restaurant on the original price of the meal-offer (Not on the group-discounted price) makes a significantly large difference in the operating cost for the Vendor as against in India where people usually do not like to leave tips or have a standard 5 Rupee coin for whatever the ware maybe.

Also the LTV is a layered value derived based on effective frequency of visit. Meaning, How many of them visited 1 time, 2 times etc... and the relative spend thereafter. Also, there is a break even frequency at the same cost before a positive value can be derived (Here is a simplified calculator)

Not all SMBs are also geared to service a peak footfall that occurs during this group-buying frenzy, which results in diluted service/offering. This hampers the conversions badly. Most of the SMBs are not seeing a conversion above 3% (median) of the footfall. I have been following rants about SMBs saying that they shall never go back for Group-buying again . I have also heard rave reviews about some Up-sale (NOT conversion) during such frenzy, especially in the Beauty Segment (people walk in for 500 RS worth of ware but spend 10K), These guys love the group-buying models... besides, there has been theories that deal-seeking bargain-hunters are never loyal (There are stats to prove this)... All of this has to play out towards a equilibrium in the long run.

The point is: Group-buying in its current avatar (Independent of what ever the top-line suggests for Groupon) is not YET a proven model for SMBs. It cannot address the economy of scale challenges of the big retailers either. So where does it fit as a positive operational model? I am not saying that this will fail. Its just that there is a lot more nuance and context specific treatment that is required to make this a classic. I am sure the markets will figure it out eventually...

For now, how many of you are standing in the line for the Groupon IPO? Make sure you do not sell your house as of yet to invest :)

Where lies the rhetoric?

2011-05-23T03:15:00.000-07:00

Its amazing how many debates exist out there on what should be the 'right' reasons to start a business. There are so many theories around making-meaning, start-to-scale, greed-is-good, fast-company etc... The proportions of these principles contradicting each other is high. Equal number of empirical evidence exists to hold each of these theory on its own. The empirical evidence is mostly either in the form of demonstrated success stories and strong learning post-success or some are retro-rationale (as some call it). Are there enough based on the principles of failure in this culture and economic context? Are there enough which are from here (India) and not pre-canned?

There seems to be camps which discourage entrepreneurs-in-the-making (EIM) to first find the 'right' reason. If the reasons does not match the eye-of-the-beholder, they are quick to dismiss the EIM as a wannabe. There is also a term 'wannapreneur' for such dismissals. This seems to be applicable to the ideas as well, which gets discouraged cause the beholder has a strong opinion against it. Woah!!!

Funnily enough, these dismissals does not come from the Investment community. Most of the investors I have come across or heard of have mostly NEVER dismissed an entrepreneur based on the stated right or wrong reasons of the EIM. Generally, the Indian investment community (I have no interactions with others) is really a mature lot in understanding that there is no point being predictive and judgmental about the reasons. Also the investors confess that they have no way to even tell, as a matter of fact, if a given idea is a great scalable idea which will have huge returns or not. They have invested in ideas they think are awesome and failed (Ok, there are many reasons to fail. I agree), and have passed great ideas, where they did not have enough gut-feel (yes, that feeling in their stomach, not the brain) but later found that it was a big hit (Yes, there are equally many reasons to succeed).

Shouldn't people start business based on whatever reasons, principles, theories they believe-in is right? If the reasons are 'strong enough' to make a difference then it shall find the early-adopters, and if it is 'right enough', they will cross the chasm.

If the markets are the best course of correction, then, shouldn't we encourage every one who is willing to crossover, to do so, independent of their reasons? Shouldn't the eco-system have a healthy amount of failure for everyone to figure out the cost of failure (or a new path to succeed) for whatever the reasons may be?

I am of the belief that India lacks by huge margins (yet) in the number of startups per year (given the per-capita measure). Also, it is way-early to define reasons/principles of success which are context, economy and culture specific, as there are very few successful startups or number of exits (yet). The only way to increase this is to initially increase the size of funnel before applying any "qualifications" to the funnel. The qualifiers are not known yet. Even if (hypothetically) known, its not reason enough to stop the inflow of entrepreneur-energy-capital.

Entrepreneurial-Energy is a scarce resource. Kindly, encourage them to start...

What's the price?

2011-05-22T01:30:00.000-07:00

I assisted a friend to purchase an assembled computer recently. There were 2 equally good vendors who offered the goods. One of the vendors was close to where we live while the other was about 30mins away. We approached the vendor nearby (In J P Nagar) and bargained on the price (common while purchasing assembled goods). The vendor nearby quoted INR 27,300/- for the same configuration while the other vendor was willing to go down to INR 27,150/. My friend settled to place an order with the vendor nearby as the price differential was only 0.5%.

Next we went to the nearby bookstore to browse some books. Friend decided to (after my rave reviews) pick the "The Black Swan" priced at INR 495/-. When we approached the desk, the gentleman behind the desk advised that a paper back version of the book discounted at 30%, is available in another store near Indiranagar (which is 40mins drive). We drove to Indiranagar to purchase the book.

Reflecting upon the events, the mental math made for NOT travelling an additional 30mins to save 0.5% off a purchase price, was offset (on the same day) by the mental math of saving a 30% off another product for which friend decided to drive 40mins.

In absolute terms, the savings in either case was INR 150/-. We clearly choose one versus the other.

Basic observation using this as an analogy for product pricing
(Eliminating the details around same-product versus like-to-like price comparisons)
Having a list-price of your product set to a ideal-ask price and then providing a relative discount to the list price has an edge compared to having a lower-list price and not offering discounts (while the absolute sale price being the same).

Behavioral Economics supports these observations and conclusions.

Worth pondering ?

What is fair ?

2010-10-17T23:36:00.000-07:00

Life they say has a mind of its own. You may be the protagonist but not the hero. Dreams may not come true. Have tried and failed. Life is not fair.

But, Fairness has nothing to do with working on your dreams, even if you do not succeed. Standing up for who you are is one thing life cannot touch.

You know there is certain death. But will you stop living life ?

I am getting sore of hearing to excuses by well meaning people (whom i admire professionally) having amazing ideas and vibrant dreams which can change the world. Your If-only-this and but-only-that is harassing me in the arguments. Please stop. I can feel you dying a slow death. You are in pain. Is that fair ?

Show-up, walk the talk, live the dream. Get started. Now...

Welcome to the Jungle

2010-08-23T17:19:00.000-07:00

And, if you need to learn the rules of the Jungle, you must live in the Jungle. Live, breathe and eat what the nature provides. You start with minimal resources anyway. The objective is to make good use of the resources provided by the eco-system. Learn the eco-system. The most important thing in the initial days is to get used to the eco-system. The new set of pathogens, different food, climate and creatures. It is these initial days that makes or breaks you. Once you weather the storm, you start getting acclimatized. The bacterias in your gut will change to accommodate digestion of different food. Your immune system will change.

Best of all, your so called intuition will change. You develop a Jungle sense of your own. You will be enamored with wild, rippling muscles and stamina required to participate in the eco-system. Your energy levels will be up. A brand new 'You'. It is this sense of feeling you must crave for...

The transition for some is painful. There is NO such thing as, "Ohhh, I shall go back to the city for some time and when I am feeling OK, I shall then return back to the Jungle...".

"Ohhh, I shall go back to the corporate life for some time and when the conditions are right i shall return back to start-up..."

I admit, its not this extreme (of course many die in the Jungle. But many more die in the city relatively... or live like deads...). I admit it does sound naive and yes your choices are always open. The metaphor is a different food for thought...

The Distribution of Intention

2010-03-28T23:04:00.000-07:00

On one of the networks 'India Leadership' on linkedIn, I did come across a interesting question as follows: "Tens and thousands of millionaires and millions of hungry/poor people in India!! How can this contradiction exist?"

My thoughts: The "distribution" of "Intention" needs to be fixed. If 'rice' is an intention, then we need to fix the distribution problems which amounts to 45% of wastage as per stats. If 'positive thought' is an intention, we need to enable effective distribution of this to reach to enough people who can make this actionable (Lynch pins). If 'money' is an intention, then we need to hold the distribution of it accountable, that, they have done enough research to economize and invest in important problems (as against urgent problems as well). if 'leadership' is an intention, we need to hold the democracy as a collective system of distribution to elect and hold these leaders accountable. Why? because, hunger, pain and suffering are viral. Their efficiency to distribute and replicate by far outweigh the positive systems that are in place in the eco-system.

Can this hold true for the "product start-up" debate as well ? I think so. The distribution of Intention is the biggest problem we as a country are facing now to enable positive sustainable eco-systems. Here is a link on those thoughts.

Misery loves company.

What does it take to create successful IT product companies in India?

2010-03-25T11:53:00.000-07:00

This thought keeps bothering me off late. Many have beaten this debate to death. I am still not at peace. What does it take to create more 'successful, innovative' indigenous IT product companies in India ?

Approximate guess says that we have less than 1% 'successful, innovative' IT product companies in India. Enough hypothesis, conjunctures and theories have proven that product based solutions (due to replication of effort and automation) provides significantly higher bang per dollar invested than services based solutions. Scaling of services is resource intensive and puts strain on economies of scale and scope. Why are we not there yet? What happened ?

Are we genetically at a disadvantage ? Are we less risk prone ? Is it a geo-political conspiracy ? Are we capital averse ? Is service mentality ingrained in our culture ? Argumentative Indians, by virtue of our intellectual pluralism have wisely concluded that Services-for-Life leads to Nirvana ?

I admit I am naive. Yes, it was beneficial to apply economies of scale and cost arbitrage creating large amount of wealth for the nation. Yes we are moving towards value arbitrage (premium services) and upping the ante. But, this just cannot be 99% of what we do in IT.

Through and through, we have been both perceptually and conceptually primed through our success in services, so much so, that we are unable to (even if we desire) embrace the paradigm shift towards products mindset.

Successful products model is R&D intensive, bets on disruptive innovation (serendipitous), is technology intensive, utilitarian and demonstrates high tolerance to creativity. Yes, "tolerance to creativity". Creativity puts focus on the individual as against focus on the group. Services model benefits from focus-on-the-group as it creates uniformity and conformance. There is a world of difference culturally in these models. You can see the culture shock and pain one goes through when a person moves from a product company to a services company and vice versa.

We need to reverse this priming. We have to focus on Indian product startups (Big companies are hard to change) and foster a eco-system which benefits product startups. We have to glorify the product model to 'exaggerated' proportions. We need to 'invent' heroes to win quick sub-conscious battles and influence the psyche. We need war veterans 'imported' to teach us the trade. We need 'real' angel investors and significant hand-holding for new startups. We need favorable business incubation centers through a Govt. endorsed PPP (Public-Private-Participation). We need to fix our priorities.

We may lack many things but cannot afford to lack priorities. If we are presented with a deaf and a blind, then, a deaf leading a blind is always better (than other way around). Vision needs to be higher in priority than the ability to hear (to the potential market). Market vision comes from innate ability to identify latent demands. How does one harness that ability ? How can we identify and nurture Visionaries ? Do We need a Revolution ?

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Addendum: The definition of a services company in this post is any company providing solutions which are labour intensive similar to the big 3 IT success stories in India. Not to be confused with software as a service or social networking services or b2b/b2c services which are driven by platforms/products.
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What will you do ?

2010-03-12T21:20:00.000-08:00

"What would you do if your were the last person on earth?" - A simple question.

Most of the people whom I interacted with on this question, responded with the following set of emotions: Despair, Attachment, Experience, Learning from the past... Deep brow, Thoughtful, Effort to reinstate the past.

Now I asked a different question to different set of people

"What will you do if you were the first person on earth?" - Simple again

This time around, the answers portrayed Desire, Hope, Passion, Trying things... Open, Thoughtful, Willingness to create the new.

Try this your self. Ask a few.

Its perplexing and amazing how much of a difference a change in the worldview makes. In both cases you were alone in the world. The thought of end-of-the-world or beginning-of-the-new made such a vast difference in the way people perceived how they would behave.

What will you do if its your first-job or last ? your first assignment or last? Your first start-up, will this be your last ?

Right Casting your Core

2010-03-09T22:34:00.000-08:00

If you are a startup and looking out to build a core team, think through on what type of people you need. Being part of several start-ups in the past and also currently being a founder of a new one, I understand the constant pressure you might go through to find the team. My personal opinion and observations on this (more of a philosophy) is not to hurry or compromise.

Do not fall into the valuation trap to bring in high-fliers and experts in their respective fields. On one side, even if the chemistry works and the people you are bringing in are experts, if they do not have enough important work to do, then, you land up diluting the interests and morale apart from the equity anyway. It is OK if you pass on great people. Make it 'equitable' for the organization and the people you bring in.

On the contrary, keep the focus on getting people with passion and who are willing to take up work beyond their capability. This has magical effects on the productivity of the team as well as the morale. I have first hand experience of this effect in the recent past. A sense of camaraderie is what makes a winning team. I have seen and heard of teams with real high fliers and the CEOs fulltime job in managing egos and fire fights.

Of course, promote the strengths and augment the weakness with advisors to the board and external help from the network. You would not want to set your core team up for failure if they absolutely lack capabilities and are just full of passion.

In short, Keep the focus on the core, promoting people with passion and assign accountability and responsibility greater than their current ability. Reduce the bling effect. You do not need big guys for valuation. This philosophy works at all levels apart from the core. Try it. Let me know.

What do you do ?

2010-02-25T15:29:00.000-08:00

Old Grandpa decided to take little Yajur to a field trip on Yajur's 5th birthday. Grandpa choose a factory which makes awesome mousetraps for the field trip. On the day, they walked into the factory, Grandpa instructed Yajur to ask as many questions as he wishes.

The field guide decided to take them to the manufacturing department first. Yajur asked the chief engineer what they are doing ? The Chief engineer said they are building the most awesome mousetrap to catch a mouse. He explained that his team is responsible to make the trap so efficient that the trap closes in super-duper-speed as soon as the mouse enters the trap.

They went to the R&D department next, Yajur asked the same question. What do you guys do ? The Head of R&D explained, you see, we are inventing the yummiest cheese to attract the mouse to the trap so that we can catch the mouse. Our research says that it is not the mouse trap but the Cheese which matters the most.

Next, they went to the marketing department. What do you guys do ? The Marketing Chief said that his job is to put the mouse trap in the most colorful boxes so that people can like the package and buy the mouse trap to catch the mouse. He also said he conducts market research on 'positioning' the mouse trap in the right place so that people can improve their chances of catching the mouse.

Next they went into a big awesome room with a nice view. The field guide explained that this is the 'Thinking' room where the CEO, the advisors and experts discuss and innovate. Yajur walked up to a expert/advisor and asked him what does he do. The expert said, see little boy, we invent new ways to catch mice. Mousetrap is only one way to catch the mice. We provide solutions to come up with newer, better, cooler devices to catch the mice.

Grandpa and Yajur were driving back home. Yajur was all along looking confused, so grandpa asked Yajur whats' bothering him. Yajur questioned back hastily, "But, grandpa why do people catch mouse?", Grandpa said, to get rid of it as its' a pest in the house. More confused, Yajur quizzed again, but, do we need to catch the mouse to get rid of it? Grandpa smiled and knew that the day's wisdom has been delivered.

Quantama Hiring Call - In Retrospect

2010-02-20T05:52:00.000-08:00

In retrospect, this call for action on Venture Woods brought in the highest calls and reactions for job application to Quantama on March 2009.

The Job posting excerpt:
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I am looking for people with entrepreneurial bent of mind to join the founding team of Quantama.com a mobile proximity company. I have the business case validated and have one of the largest retailers in India showing Intent to implement when the product is ready… Angel rounds are being vetted and talks in process… Have product case and prototypes in development…

The markets we are addressing are emergent and pervasive… A distant fortune is heard of…

I promise you that your experience shall be cast with risks, hardship, pain, sweat and blood. The journey will be turbulent given the economic times.

If you see providence where others see peril, do get in touch with me for more detail and I shall be glad to consider a sitting…
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Serendipity is the Key.

2010-02-19T22:10:00.000-08:00

Most of the established businesses get into a pattern of finding out what is working and doing 'more of it'. This is good for bottom line, margins, and retention of your existing customers. But, is it good for breaking new grounds ? Making the pie bigger ? Your Top-line?

Business-as-Usual is to work hard consistently, trying to cash out on the idea that made the business successful. They work hard at establishing Cliches. Cliches are good. They are 'time immemorial'. They express ideas in simple words, but they lack the freshness and eloquence of a magical orator. If you have read the blogs of Seth Godin or heard president Obama speak or have followed the marketing of Apple, they do not rely on Cliches. They break the mold, create new meaning, speak different truth, change the worldview, present their stories in a more innate yet excitingly new package. They are Contrarians. They are Serendipitous. Here is what Seth Godin has to say about Cliches

Imagine that you are a T-Shirt vendor with a inventory of T-Shirts made of several attributes. Lets say you have 4 sizes (S, M, L, XL) and 4 Colors (Red, Blue, Green, White). When you first set shop, you do not know how many of each T-Shirt variant to carry (how many of Blue-XL will sell?). So you start with 10 shirts per variant combination and open business. Now, the first month you sold all the Green-L shirts, some Blue-XL and none of the others. What do we do? We decided that Green-L sells more in this catchment and order a bigger inventory of Green-L and lesser of others (Finding out what is working and doing more of it). If for the next few months, the trend continues, then, going by the pace, you may land up being a Green-L T-Shirt vendor. Its obvious that the more Green-Ls you have, the more your sales-report shows that you have sold the same. You already know whats wrong in this analogy. Yes, its a simple example, its so easy to see. Its a no-brainer.

But then, how come you do not see this analogy in the business strategies you follow ? How come you are not trying to find out what else your consumers are willing to try ? Why do we intellectualize for ages on why something "may not" work because "your" past data provides facts to your beliefs. Is it Fear ?

Start-ups on the other hand does not fear to be serendipitous (In a way, they have nothing to loose). An entrepreneur identifies an opportunity to make meaning. A passion-fruit colored T-Shirt, A Vanilla-Sky colored Tshirt. Try something afresh yet innate. Change the fabric, the texture, the weaving, the grain count, whatever... But be eager to explore, break the Cliche, turn it upside down. This is why it works and new tribes are formed. This why the most successful ones are Genre-Bending.

Every time you support your views on past-data, think again. Question yourself. Give Serendipity a chance. Believe in the art of possible.

Shared Consumer Data, Reciprocal Marketing and Conversions for Retail

2009-07-27T04:21:00.000-07:00

Reciprocal Marketing is not a new concept in Retail marketing in India. Mostly in the B2B segment where promotions, cross-subsidy and cross-sale combinations exists. Insurance is offered for people who open bank accounts. Credit cards are offered in conjunction with book buying (landmark). Money back when you fill gas in a IBP station on debit cards etc... All this hints towards sharing the consumer (data).

To carry this to the next level, it is important for Retailers to come out of their shell and stop worrying about 'who owns the consumer data'. I keep getting into all sorts of debates and uncertainties of why Organized Retailers should or should not expose their Consumer data. The claim for not exposing is that, clean data is expensive and the IP differentiator for better conversions and loyalty for a given retailer, so the data should be owned and not shared.

But what is clean data ? How do you validate it ? How do you maintain it ? What is the cost of logistics ? What is the strategy for conversion ?

Clearly, the sum of cost of solving above hurdles for "clean consumer data" is significantly higher for the Retailer before gaining any benefits from such a data if each and every individual Retailer repeatedly manage their own datasets. This is why there is a half hearted effort by every Retailer. Nobody seems to have walked the whole mile (maybe except the Gas Agencies as its a regulatory body and they must validate). Consumer Loyalty forms, credit card records and Home delivery challans are the only validators existing today. Among this, credit card companies will not authenticate the consumer info fully. Payment gateways are a black box. Obtaining consumer psychographic details is a costly research and catchment exercise.

Instead, why not free the data ? Put it up on a "Consumer Data Cloud". Open the collaboration of consumer data by offering direct incentive to the consumers for maintaining and upkeep of their own info (with a shroud of privacy). Technology exists for this today.

Sharing the consumer data across segments shall be the next disruptive wave to change the Retail horizon.

The time has come to reap the benefits of open collaboration (Given that consumers are readily pouring their life's worth on Facebook, Twitter, MySpace and the rest of the Ning bases). Yes, privacy is a concern. Privacy must be the focus while collaborating such data independent of whether it is on a Retailer's platform or otherwise. I would go a step further and argue that privacy can be better managed, audited and assured if consumer data is managed as a single source of truth (single cloud). The cost of assuring privacy for such data for every Retailer on their own infrastructure is high and incredulous !

The benefits of freeing consumer data ?
- Pruning of costs across CRM which releases fairly significant chunk of capital. A portion of that capital can be re-purposed for interacting with the 'consumer data cloud' (smaller than the cost of managing your own dataset)

- Single source of truth both for the Consumer and the Retailer. Consumers especially can have a single pane of glass across all their Retail outlay (visits, purchase, spend, loyalty points). Retailers of course benefits from higher analytics and trending across consumption lifecycle of the consumers.

- Enablement of a Co-Opetition framework where Retailers can co-operate as well as compete for the Consumer's attention. This is where true reciprocal marketing evolves. Cross loyalty, cross segment combo kits (dinner and a movie package), targeted promos, cross segment redemption schemes will be more meaningful and rich in ideas and innovation.

End result? better engagement, targeted touches, hand holding across consumption lifecycle, point discounts, higher redemption and yes, absolute conversions. Sounds like utopia, maybe not. But truly a step closer.

All this and more is possible only if Retailers break their shell and hatch. Its about time the data is free (as in freedom)...

The Worth of Value

2009-07-22T02:28:00.000-07:00

How does one sell in a down economy ? Given that consumers are becoming value conscious, many of the Retailers I am speaking to are seemingly trying to answer the question "How do I assess, reach out and offer what is 'valuable' to consumers contextually ?

Why is Value contextual ? Because, it is based on the end user, end-usage and the environment. This is a coarse grained dimension of Value.

Marketing gurus exemplify that other fine grained dimensions of value exists.
- Value is Relative; relative to alternatives available within the given context.
- Value is Perceptual; driven by the current senses.
- Value is Provisional; New information can change percepts.

Given these, the dimensionality of value from a economic perspective brings in the concept of the "worth" of value. The risk in acquiring a value target determines the worth of the target.

So are consumers really value-conscious or worth-conscious. I guess they are both. Once they (some how) determine that something is valuable, then they start seeking to find if its worthy. How can Retailers determine the worth of a value for the consumers? For one, the worth is driven by what the consumer perceives as intrinsic risk in acquisition of value. Mostly, the risk of "being wrong" in whatever sense it may be is the biggest risk I foresee in determining the worth.

What if I paid too much ? What if I could have got a better product at the same price ? Does this look good on me ? What does my spouse think of it ? Does this product convey a better meaning of me (Cool, Smart, Sharp) ? Is it hygienic ? Do I have place to keep it ? etc... etc... are the risk driven questions in the consumers mind.

The exploding choice of products providing same/similar value is going to add to the "risk quotient" in determining the worth of value. The lesser the choice, the higher the worth. The higher the worth, the higher the price.

In essence, it does boil down to offering value to consumers across all dimensions while making it worthy (Branding). Especially from the dimension of 'Value being provisional' where the Retailers provide differentiated clarity for the value being offered. Providing that differentiated clarity should start way early in the consumption life-cycle. Typically the consumption life-cycle from a consumer perspective (Not the retailers perspective) is across the phases of Awareness, Research, Transaction, Delivery and Consumption. It is primarily important that the clarity is provisioned through out this lifecycle.

Providing clarity requires personalized touches and individual reciprocation with each of your consumer. Knowing the consumer including likes, dislikes, opinions, past purchases, current context, psychography etc. along with the intrinsic knowledge of the product assortments offered is a requirement. Building a value/worth grid based on this knowledge is essential. Engaging the consumer interactively through differentiated (not different) marketing channels is important. I guess this is the place where technology should gear-up to enable the "Experiential Economy" to make the while worth.

Convergence of Proximity based Technologies, Social Media, Collaborative Filtering, CRM and other such Simulacrum may offer probable solution. It shall be some while before true convergence can happen. Disruptions in marketing channels, technology, loyalty programs, product management and category management may be inevitable before it gets worthy more than valuable.

The Experience Economy of Mobility and Convergence

2009-07-08T04:33:00.000-07:00

The Experience Economy specifically in the convergence and mobility (as in mobile based) sector shall gain new heights both from a continuous and dis-continuous innovation.

Why ? Purely because of the disruptive nature of just having more bandwidth on majority of the handsets across social strata.

Experience economy as defined is the orchestrated events made memorable to the consumers which collectively by in itself becomes a "product". Flashback to the Movie "Minority Report" in which Tom Cruise walks through a shopping mall and based on his iris scan, he gets beamed with relevant promotions within the vicinity that is specific to his profile and custom tuned to his liking.

Though I will not get into the super cool ingredients that may go into making this sci-fi happen today (as I am ignorant), I am fairly confident that a similar (diluted) experience can be achieved using the Mobile devices. Ability to ID the consumer through the device, Cloud Compute servers to crunch and store relevant Consumer Info (considering privacy), Relevance algorithms (similar to what is being used in NetFlix and Amazon) exists in one form or other. The missing ingredient was ubiquity of bandwidth on mobile devices.

Bandwidth hurdle being removed (3G, Bluetooth 2.0), the play will boil down to "What is the best impact provided during the time of maximum exposure ?". The time of maximum exposure is when the consumers is in your store or the shopping mall, browsing.

As arcane and cryptic as it sounds, there in lies the key for many new entrants and start-ups opening up new market categories. Each player can significantly differentiate themselves by choosing the right attributes to own.

Quantama is one of such start-ups creating a new category in the mobile proximity space for Organized Retail. Stay Tuned...

Emerging Business Drivers and Orthogonal Validations

2009-07-07T04:16:00.000-07:00

Rapid Adoption of IT systems across sectors and Domain: Globally as more and more systems are being digitized, the need for testers have increased drastically. The availability of the resource pool who has the necessary domain knowledge is also shrinking which has lead to a resource pool crunch. That said, it would be paramount to ramp-up Business Analysts and Product Primes to acquire the pre-existing knowledge within the domain and innovate upon that knowledge. Bringing testers up to speed then becomes the responsibilities of the Analysts and Product primes. The secondary problem of non-availability of Skilled (automation scripts) testers to perform the necessary functions gives raise to a requirement of machine based frameworks to fill in the gaps of non-availability of the resource pool. This gives rise to the lateral industry of automated code generation for developers speeding solution development as well as automated test case generation aiding the Quality Assurance folks. Business Analysts are demanding tools which enables them to create test scenarios without having to write code.

Impedance mis-match during knowledge transfer: When the knowledge transfer of the Domain has to flow from the Analyst to the developers and testers, the impedance mis-match in translating the knowledge in terms of articulating the nuances of the innovation and the capability of a tester (as per say) to understand and assimilate that knowledge into the respective Testcases is mind numbingly high. This high mismatch in what was expected to be built and tested and what landed up getting built and tested will lead to heartburns during acceptance scenarios. Demand for extreme traceability of Testcases and test steps to the requirements has increased rapidly.

Complexity of the Product: The choice of the technologies and frameworks and platforms used in manufacturing and building the solution also adds up to the complexity of the test cycles. ERP implementation, PDLC of a Enterprise Product, SaaS based Solution Delivery, Cloud Compute enabled solutions, Data Center Management, Legacy Integration etc, are not only rich in semantics from a Domain perspective but are also complex to assimilate to understand the breadth and depth of testing strategies required to validate and provide assurance of quality. Demand for pre-built adapters and catalogs which can readily integrate and work as expected during last mile integration is on the rise.

Heterogeneity of the Systems: Added to the complexity of the product, the IT eco-system in which these product operates today are made up of different systems from vendors such as IBM, Oracle, Microsoft, SAP, Sun, HP etc... (including home grown solution) that contains various platforms patched up together through ESB and SOA integration. Even the choice of Operating systems and hardware platforms have become varied that performing a configuration and version compatibility test for any given platform has started to look daunting. Virtualization and Automation is becoming the norm of the day.

Shrinking GTM and Focus on short gain cycles: Typically the Product development lifecycles and Go to market cycles are shrinking in the light of ever changing business dynamics. Every one wants to put the product out in the market as soon as possible capturing the customer share as soon to gain control on the changing business dynamics. Agility, it seems is paying dividends for such short GTMs and providing a quick ROI. SaaS based and On-line solutions are moving towards perpetual beta platforms which can rapidly adopt to the customers needs. This also holds true for ERP implementation cycles which are shrinking by the day. What used to take 5 years are now being reduced to 1 year implementation cycles with rapid customizations. Demand for baseline Testcases covering top few probable customizations of a large product base is increasing. Pre-built Test Content 'cartridges' are the need of the day.

Shrinking IT Budgets: Discretionary spend has been monitored more closely and also the overall IT budget is shrinking by the day. CFOs are breathing down the CTOs neck for efficiency and productivity for every dollar spent. This has lead to cost cutting in terms of support staff (people) and reduction in spend of applications and products (license). CFOs are moving away from making any large capital commitments at the outset impacting high CAPEX vendors. Converting the fixed costs to variable cost is the Financial Officers edict across LOBs. Demand for subscription based usage is on the rise.

Global Recession Driving Margin Pressures: Global recession being the new reality, the pressure on margins (not to mention survival) is high. Corporates are looking for operational efficiencies to increase the margins to retain the operating profits while the top line sinks. Increasingly corporates are betting on digitizing and automating all processes that can be automated which shall convert to cost savings by downsizing the cost centers. Demand for outsourcing the validation and assurance and SLA management is on the rise.

Demand for Highly Reliable Products and Service: The general tolerance for a good quality product has come down. Consumers are demanding 'excellent' quality products. In effect, what was excellent yesterday is just good enough today. Reliability and Relevance are the two parameters that are driving the world markets. If a product or a solution is not meeting the standards of 'excellence' then there is no place in the market for the solution. Corporates are trying to leverage machines (computers, robots, software) as much as possible to automate the core solutions. Automation unlike manual processes provides a high degree of reliability when employed through out the production cycle. Demand for metrics based reports with high degree of SLA while enabling automation is on the rise.

Regulatory Compliance: With the increase in the number of regulations in any given sector (HIPAA, SOX, GLBA etc...) the burden of certifying the product, platform, application or service has increased dramatically. This has led to the amortization of working capital from core production cycles (bread and butter cycles) to compliance activities. Given the same capital budget (which seemingly is shrinking as we speak), the number of activities in production has increased to cater to the compliance demands. Corporates again are seeking automated compliance testing tools to ensure certification which increases the operational efficiencies. The compliance requirements has made the corporates to refactor the dynamics of a verification and validation LOB from a cost center to a value center. Demand for compliance catalogs for verification is on the rise.

Increased Threats and Security Compliance: The threat levels have been ever increasing and the types and nature of threats have become innovative. Security Compliance has become a core activity of any validation cycles for products and solutions. Penetration testing, Functional Security, Security Standards Compliance etc... adds to the release and build test cycles as a natural PDLC flow increasing the number of core activities to be performed by QA. Corporates and QA departments are seeking automation platforms in these and other areas to release enough bandwidth of the existing people so that what has to be (and can be) performed as manual verification has enough people available to perform. Growing need for security verifications as part of the automation solutions is been on the rise.

What does these emerging drivers means for Verification and Validation process ?
Simply put, testing is not a gating function anymore. Testing has become an inherent QoS (Quality of Service) through out the life cycle of production or service delivery. Testing has become a change agent addressing risk early on in the lifecycle and continually assuring reliability, relevance, Security and compliance apart from providing functional acceptance and assurance for the product or service. Testing as per say has become a value creator and quality differentiator for the end product to provide the required edge to compete in the market place of excellence. Testing has become an "Orthogonal" platform, process and activity to cater to the demands of the new markets.

AutoCzar a test automation platform seems to be reinventing itself to cater to these emerging trends.

Mobile Call without getting Billed

2009-07-06T05:20:00.000-07:00

Convergence along with Innovation is a deadly concoction. It has been said that no power in the world can stop an idea whose time has come. So it seems for Cherry a Belgian Tech Startup in the Mobile MVNO space. The coolest thing about this innovation is the ability to make calls to the people in your contact list without using a SIM card. No I am not smoking, YES, ITS WITHOUT A SIM CARD.

The technology uses a "handover" protocol as reported whenever in the vicinity of a Wifi range. There is a application required to be installed on the phone that shall seamlessly switch between Wifi and GSM. Interesting and Exciting. Read more on this here...

New Venture (Quantama)

2009-07-01T04:28:00.000-07:00

My last blog was quite a while back. I was caught up (lousy excuse) in establishing a tech-start up. I am currently working on a mobile proximity start-up focusing on Consumer Lifecycle Management for organized Retail (www.quantama.com).

Finding seed capital during recession, working on positioning for new market, getting a core team in place and getting the first customer on board have its own share of anomalies. Added to that, learning of things that you may have seen or done before all over again for the new market realities is an exciting challenge an entrepreneur may grow up to appreciate. In fact there is a sense of vuja-de experience (things look new even though you may have done them before) this time around.

Deep down inside, I know that all the positioning I perceive for the product before hitting the market is a preparation in principle to be able to cope with the game changing realities once the product rolls to production. Eventually the market shall position the product. The trick is to plan enough to minimize the delta efforts to reposition. This time around, I 'seem' to have understood the philosophy of "Flow with the Go" as Guy Kawasaki puts it in 'The Art of Start'... But the best is yet to come...

As Frank Sinatra's Song goes:
"Out of the tree of life, I just picked me a plum
You came along and everything started to hum
Still its a real good bet, the best is yet to come

The best is yet to come, and wont that be fine
You think you've seen the sun, but you aint' seen it shine"

I am hoping that this time around that I see the sun shine...

SaaS'y Benefits

2007-02-17T16:00:00.000-08:00

SaaS or Software-as-a-Service as it is coined is the ability of a external service provider to provision a business service over the internet so that it can be consumed remotely by (mostly) enterprise organizations. The luring drivers for running software as a service stems from its propositions of the ability of a external service provider to apply economy-of-scales for either IT operations or applications to offer better 'benefits' to the consuming organization. benefits such as cheaper costs, high availability and better scalability are promised and seemingly delivered.

Non-SaaSy Enterprise (Business as Usual):
In fact, since IT spend happens to be one of the key drivers which is driving the SaaS adoption, lets take a look at the average IT spend and the proportions of such spend broken down into line-items spread between the CAPEX (Capital Expenditure) and OPEX (Operating Expenditure) of the spend.

Here is a table on the cost breakups as per Gartner's survey on annual IT Staffing and spending:

70% of the IT spend comes from the OPEX per annum while only 22% comes from the CAPEX. Focusing on the OPEX, we can see that 32% of the OPEX is due to Internal Staff (which is also 22.4% of the whole IT spend) and around 21+17+14=52% of the OPEX coming from Hardware, Software and Telecom. here is a pie chart to display the breakdown.

Now this being the BAU (Business As Usual) cost break downs, how would making your business SaaS'y benefit your bottom line?

Benefits offered by SaaS Model
SaaS as defined is a outsourced model which allows services to be accessed through the internet remotely by the consuming organization. Saying this from a 'SaaS providers' perspective what are the benefits a provider can offer and how can the provider achieve the same? Some of the benefits proposed by the SaaS model are as follows:

Service at Cheaper Cost
Better SLA than internal IT (Scalability, Availability, Performance, Maintenance, Upgrades)
Accountability

I would strongly advice the readers to read the Microsoft article titled "Architecture Strategies for Catching the Long Tail" to understand the intricacies on how these benefits are provided.

- Cheaper Cost: the SaaS providers can offer cheaper cost by employing what you call as a 'economy-of-scale'. A SaaS provider (based on the maturity scale he is in) does offer the same service to more than on customer. This allows the SaaS provider to share common utilities across multiple customers. This allows the provider to spread his cost across customers bringing down the overall cost of operation for the provider. The provider eventually passes on such cost reductions to the customer by charging lower for the Service.

- Better SLA: Similarly, the SaaS provider can employ clustering, grid computing or elastic compute cloud that is offered by some of the 'utility computing' enablers to leverage a managed and virtualized infrastructure to bring down the providers overall TCO (Total Cost of Ownership) of running his operations across customers. The economy of scales in virtualization of systems and elastic compute clouds (Amazon EC2) does offer exponential benefits as computing volume increases. This not only results in further reduction in cost of operations but also aids in better SLA offering. SLA's such as Availability, Scalability and Performance are inherent to such utility architectures.

- Accountability: Since SaaS providers play as external vendors, the legal obligations and contracts will implicitly be more stringent than the contracts with the internal IT. Also, Since SaaS providers are 'in business' selling the proposition to be profitable will have genuine interests to make the model equitable (I am not accusing the internal IT here). Saying this, the accountability also comes from the fact that the operational model of SaaS enables the consumer to get a metered/leased billing frequently (at the end of billing period) that allows a detailed break down on the usage of services. The service usage if subscription based is simpler to manage as against a 'transaction pricing' model. The transaction based pricing also refereed to as pay-per-use or pay-by-the-drink requires operational infrastructure available at the SaaS providers end which can enable such metering (more on this on further blogs). Such metered usage allows both 'throttling' of usage both by the consumer as well as the provider. A SRM (Service Relationship Management) office at the providers end will ensure constant support (with support SLAs) probably better than the internal IT (due to economy-of-scale again). All this ensures that "IT as a Business" is more realistic to run by being SaaS'y rather than trying to make the internal IT run there process as business.

Given these benefits, it makes sense to reduce the internal IT spend across the CAPEX and OPEX as shown and start considering IT as a 'service center' instead of a 'cost center'. The benefits of a reduced TCO as well of a higher ROI (being a service center) are seemingly guaranteed (again based on what maturity level of SaaS is being embraced and the overall IT policy). Rationalization of the IT Governance structure as well as obtaining executive sponsorships can be real hurdles for initiating the programs (as these benefits are not been qualitatively demonstrated by many vendors yet).

This said, Enterprise still needs to go through a paradigm shift in their operations to embrace SaaS into their ITEcosystem. Questions such as :

Enterprise efficiency and operational changes for SaaS Vendor Management.
Enterprise Integration of SaaS systems into strategic systems that are running internally.
Integration and collaboration of SaaS systems across SaaS vendors.
Enabling business process orchestration that is seamless across the IT Ecosystem.
Regulatory Compliance rules for SaaS engagements.
Enabling and Tracking of a 'Process Health Matrix' to monitor the overall benefits across enterprise IT ecosystem to see if transforming few LOB applications in to SaaS is not jeopardizing short/medium term goals of the enterprise.

etc... are some of the challenges that still needs to be addressed before getting on to the SaaS bandwagon.

The Long Tail of IT Spend

2007-02-16T03:17:00.000-08:00

'The Long Tail' is a 'power law of distribution' used by statisticians to define a expanding market (in any given discipline that is) in terms of the economic and business model of the market. In fact the phrase 'The Long Tail' was coined by Chris Anderson (editor-in-chief) of wired magazine. In simple terms the long tail can be explained with a graph as follows:

This graph compares the total average IT spending of organizations of differing organizational sizes. Notice that the graph has a 'Big Head' with high amplitude but is immediately followed by 'The Long Tail' of lower amplitude (or spending) organizations. Though this graph is not 'explicit' in denoting that given the universe of discourse of all organizations which spends on IT, The top IT spending organizations ('The Big Head' of the curve) will still fall short of the collective 'volume' of IT spend that occurs on The Long Tail. This is seemingly true because the 'number' of organizations with a high IT spend are relatively (significantly) smaller than the overall 'number' of organizations who are spending on IT. In short, the spend volume of small number of high-spend companies is lower than the spend volume of large numbers of low-spend companies (huh).

This theory holds true in other areas as well. Ex. The Amazon business models. Amazon as a service provider over the internet can cater to this long tail of business easily compared to the brick-and-mortar bookstores such as barnes and nobel or borders. The 'easiness' comes by the virtue of offering the 'book store service' over the internet. As amazon does not have to maintain in-store inventory, it can almost have a large warehouse of 'all' kinds of books and deliver it directly (probably from the factory warehouse in some cases) to the consumer. The 'Top Sellers' which are relatively few in number makes the big head, compared to the rest of the non-top-sellers which makes up the Long Tail. In 2005, 50+ percent of Amazon revenues came from the Long Tail. The last I checked (in 2007) this number was at 25+% (percentages are deceiving in the way you read them).

Here is another graph that explains the long tail of music industry that depicts the average number of plays per month for music available in Walmart and Rhapsody.

Coming back to the point of the Long Tail on IT spend, there seems to be a burning question (mostly as i see it) that needs to be answered about

"identifying business models that can be considered to solve the reduction in costs of IT operations in any enterprise (whether its part of the Big Head or the Long Tail)."

Before answering that question, its worth taking a brief look at the SMB (Small and Medium business thats part of the long tail) market which makes up the IT Spend accounting to 150B$ (Yes thats estimated at 150 Billion Dollars as per IDC).

Its also worth reading the article titled 'The IT Market’s $150B SMB Long Tail', published by Frank Gens who is a senior VP of research at IDC.

Seemingly, both in the above article and also mostly elsewhere the answer to the question seems to lie in SaaS (Software as a Service). But can SaaS really answer the question to cater to the SMB long tail?... It remains to be hypothesized...

Architecture Process Framework

2007-02-12T01:13:00.000-08:00

For several years and across several product development engagements, I have come across varied organizational structures and 'disparate' architecture and development processes that I thought I must reflect upon my own understanding of these ideologies and present a 'process simulacrum' that I have been able to assimilate over time. In essence, the simulacrum is based on varied development methodologies such as RUP (Rational Unified Process), Agile UP, XP (eXtreme Programming), SCRUM, DSDM (Dynamic Systems Development Method) etc...

This 'process simulacrum' is not general purpose. In my mind, the process I will present in this article will be applicable to technical architecture process as against a overall functional PDLC.

(Caution: I have 'tried' to keep the article short, but have justified the definitions of some concepts, which makes it a rather longer version of a blog.)

This technical architecture process will emphasize the process workflows necessary to enable the “core platform” of a given product. The process will also help establish a “technology change management” practice within the product lifecycle. It will also accommodate any technical/technology POCs (Proof of Concept), early architectural spikes and prototypes required for the functional architecture of the product.

The overarching vision of this process simulacrum is to aid in objective evaluation of the architecture/technology in context so as to provide unbiased feedback to the organization to consider appropriate decisions during the overall product development roadmap.

Let us start with a workflow diagram that denotes the flow of process as well as artifacts (mixed into one). I have kept the flow as simple as possible so that its easy to augment the process into both predict frameworks such as RUP as well a agile frameworks such as Xtreme Programming.

Going further the blocks within the workflows for the given process is explained in detail.

1. Technology Management

The charter for technology management includes:

Deriving a technology roadmap
Establishing the roadmap within the organization
Seeing through the execution of the roadmap and
To optimize the roadmap based on changing product and technology requirements.

A technology roadmap is different from an architecture roadmap. In it, a technology roadmap manages the external and internal (home grown) technologies that can be used to manufacture the product or aids in animating the product manufacturing process in itself. Typically a technology change management governor (or council in case of very large organizations) owns the responsibility of technology change management to drive the road map.

As an example, a technology roadmap is made up of:

Technology compliance entities such as compliance for J2EE or .NET. (versions included)
Third party integrations based on buy vs builds
Migration paths such as Oracle 8i to Oracle 10g, J2SE 1.3 to J2SE 1.5 etc… (includes EOL derivations)
Framework implementation milestones such as Struts, Spring, Hivemind, etc
Tools implementation for roundtrip engineering, engineering performance, code coverage etc.

Technology roadmap is a subset of the overall architecture roadmap. In addition, the Architecture roadmap owns the conceptual entities specific to the overall functionality of the product:

Specification compliance entities such as JSR168, JSR170.
Meta standards compliance such as CIM, DCML etc.
Concept/Process compliance such as SOA, MDA etc…
Domain specific implementations such as CMDB/SMDB, Multi tenancy.
Core enabling module milestones (relevant to platform) such as security kernels, web services, edge integration frameworks etc.
Compliance architecture for regulatory standards such as SOX.

Core Activities of Technology Management includes:

1.1) Technology Requirements Analysis (TRA)
1.2) Technology Lifecycle Management (TLM)
1.3) Deriving Technology Roadmap
1.4) Buy vs Build Analysis

1.1) Technology requirements analysis (TRA) : this activity derives the technology requirements necessary for the product. Also, a technology usecase (where relevant) must be derived within this activity. A technology usecase is different from a functional usecase. In a technology usecase the product use of technology is depicted (Example framework, libraries, toolkits) as against a functional usecase. Deriving the technology requirement for the product is part art and part science. This is because the requirements are heavily bounded by three influencing factors namely

Business need and value add: The business need is the heaviest driver for the technology requirement. The requirement must always materialize into dollars earned or saved. Economic feasibility analysis is the key for validating the technology requirement against the business need. (Sub-Activity: Economic Feasibility Analysis)
Market maturity of the technology: The next priority would be to understand the industry maturity and acceptance of the technology. A bleeding edge solution in most cases is always pre-mature to implement. And not all legacies are always meant for a sunset. Understanding the market progress and industry acceptance for timing the technology is always a balancing act. (Sub-Activity: Market Maturity Analysis)
Product readiness for the technology: Lastly the product readiness to implement the technology within the product needs to be established as a part of the process for validating the technology requirement. (Sub-Activity: Product Readiness Analysis)

1.2) Technology Lifecycle Management (TLM) : Technology life-cycle management includes the management of the existing technology components within the core platform of the product. This includes maintenance and optimizations as well as migrations and upgrades. This activity also manages a config map (or an inventory) of the current technologies used within the product and the respective status of the technologies. Example of technology status could be “marked for migration”, “eol identified”, “current”, “legacy” etc… [I have a separate block and a section dedicated to this activity. Depicted in the diagram as 'Manage Technology Lifecycle']

1.3) Deriving the Technology Roadmap : As stated this is one of the core activities of technology management. Here a representation of the technology implementations, upgrades, migrations, and EOL (end of life) of the technology within the organization will be depicted based on a milestone within the roadmap. Mostly the roadmap will be driven through the technology requirement validated through the requirements analysis process. One of the other key input criteria for the technology roadmap is the product roadmap. The product roadmap acts a driver for the technology roadmap to validate the milestones for technology change.

1.4) Buy vs Build : One another important activity of technology management is to perform a buy vs build analysis for the product. This analysis can kick start a POC effort which emerges out of technology management discipline. The POC effort is depicted as a process stream within the technical architecture process workflows.

2. Technology Prototype

The technology prototype is a discipline or a process that enables activities for accomplishing architectural spikes or Proof of Concepts necessary to evaluate technology contenders (or architectural component) based on objective validations. The prototyping will be context specific and will be based on the nature of the POC required. The following are some case examples of the nature of prototypes:

POC for a third party framework such as Spring or Hibernate.
POC for a design threaded off from a functional implementation
POC for a architectural component for platform services such as audit library, event managers
POC for a tool such as code generators, transformers etc.

The purpose of a technology prototype discipline is to take the technology and product requirement closer to reality through objective evaluation of the concept through prototypical implementations. Also, the technology prototype discipline provides a controlled environment to fail within the given context bounds so as to evaluate the risks of implementation of a specific functional component or a technology component that gets embedded into the product. A prototype enables better control for risk avoidance/mitigation and reduces grave design flaws that may creep into the architecture.

Core activities of Technology Prototype includes:

2.1) Concept Analysis
2.2) Architecture Analysis
2.3) POC Construction
2.4) POC Documentation

2.1) Concept Analysis : First level theoretical evaluation for the POC implementation spawning the appropriate context for POC implementation. This phase is more to rationalize the scope for POC so as to not get carried away or overwhelmed with requirements not germane to establish necessary objectives. This activity will also help rationalize if the POC is necessary in the first place.

2.2) Architecture Analysis : once a context and a rationale are established through concept analysis, it becomes necessary to analyze multiple styles of architectural designs. This activity is more iterative and incremental in nature. Architectural analysis at the prototype stage tends to be driven by an “Agile process” to accommodate quick success criteria to choose a specific design (or a couple of designs) to implement in the POC construction phase.

2.3) POC Construction : POC construction is also iterative and incremental in nature, more so driven by an agile process to evaluate the best design for a given requirement. The POC construction will implement multiple architectural designs and will concentrate on quickly throwing away bad designs in the process.

2.4) POC Documentation : POC documentation is the most important activity throughout the prototype discipline. All the decisions starting from concept analysis through construction must be well documented to understand the merits of the decisions. It is very much necessary to justify the decisions through documenting the pros/cons, merits/demerits, implications, risks/mitigation and trade-offs made while arriving at a decision. Any compromise on the documentation will either prove costly at the later stages due to lack of understanding of a decision, or will expend unnecessary effort to recursively re-justify the decisions through unproductive means.

3. Feasibility Assessment

The feasibility assessment stage is to assess the feasibility and viability of the POC. This assessment is different from the feasibilities done at the technology management process block level. POC feasibility is done within the context of the architecture feasibility or the design model feasibility used within the POC from a purely technical angle. This stage is iterative in nature. When a given model is considered not viable for implementation, quickly the model is thrown away and a better design is synthesized for consideration. Feasibility assessment is also incremental in nature.

For example, during POC feasibility analysis, the POC conclusions are carefully evaluated to understand the trade-offs and merits with respect to the:

Does complexity affect the deadlines (Design Patterns, Architectural Style, Algorithmic)
Risks involved and mitigation strategies.
Product architecture readiness to augment the design under evaluation (architectural integrity).
Is there any platform design changes required?
Is there any functional design changes required?
Cost of implementations including effort per resource type and cost of technology (tools etc.)

Core activities of Feasibility Assessment includes:

3.1) Assess the Complexity of POC.
3.2) Assess the effort of implementation.
3.3) Assess the impact of existing milestone.

3.1) Complexity of POC : Complexity analysis is already mostly done during the architectural analysis activities within the technology prototype process block. During feasibility analysis, an overall analysis in terms of the augmentation of the design into the product architecture is conducted to understand the nature of changes involved for the existing product. These changes can be to the platform or to the application depending on the context of implementation.

Gap analysis: Gap analysis will help understand the delta of all the changes required to implement the POC.
Impact Analysis: Impact analysis will help understand the risks and efforts involved for the delta identified during gap analysis.

3.2) Implementation Effort : POC usually tends to be a quick prototype to establish an objective success criterion for a given technology contender to be implemented within the product. During feasibility assessment, it becomes necessary to project the efforts to get the real work done during the course of implementation into the product. Effort estimation is important to assess the cost of implementation. Effort estimates are directly proportional to the complexity of implementation.

3.3) Impact on existing milestone : project Impact analysis is based on the complexity of implementation as well as the effort involved during implementing the same. In effect, during project impact analysis, the effort is evaluated against the exiting milestones (even more important to the functional implementations).

4. Executive Committee Sign-off

Executive Committee sign-off is a discipline enforced for high cost, high impact project implementations. This discipline is exceptional in nature and will be exercised based on a threshold set for the costs, efforts, complexity, or delta etc.

This discipline ensures that appropriate visibility for high impact projects (POC implementation) are executed so that the executive decision makers can sign off on any deviations from the current plans, release, or technology.

Mostly, the sign-offs are required for project deviations, project cost/effort, or any other thresholds set as per executive will.

5. Technology Implementation

The technology implementation discipline helps in realizing the signed-off POC within the product. Technology implementation disciplined is reached only if the given context of implementation is any of the following:

Platform component implementation (change)
Framework, library, toolkit
Third party induction into product
Technology Migrations (Based on technology roadmap)
Tools development for internal use (productivity, deployability, configurations etc…)

Technology implementation will be governed by the same principles that are applicable to all other implementation (construction) projects as well. The principles of iterative and incremental development, quality assurance and iterative release cycles are fully applicable here

Technology implementations will be governed by active architectural reviews of implementation to ensure proper design-to-code realizations of the proposed designs through POC. Architectural reviews and architecture assurance will be covered in detail later in the document. The following process flow helps emphasize the iterative nature of any implementation lifecycle.

Note: the implementations are influenced by “change requests” raised during periodic architecture reviews as well as “bugs/issue” found during quality assurance cycles

The implementations are subjected to unit tests, feature tests (based on technology requirements), and tests specific to architecture quality that includes modularity, configurability, performance, scalability etc.

6. Technology Quality Assurance

Technology quality assurance is a discipline to establish quality for all the technology components released to the base platform. Technology quality assurance activities, in spirit, are no different from the functional quality assurance activities. The only key differentiator here is the nature of requirements and test cases that influences the quality assurance process.

Technology requirements specifications document and use cases will be used to feed the test cases specific to technology QA. The requirements will be generally for the features or functionality of a technology component such as framework, toolkit or library.

Activities: All/any activity adjudged and obvious to the QA process (as decided through PDLC) will be applicable within this process. QA activity will be iterative and regressive to maintain multiple bug cycles during the course of the project.

Artifacts: The input and output artifacts will also be specific to the QA process as decided by the PDLC. Bugs and issues will be logged using an appropriate tool.

Key Note: More specifically, unit tests and code coverage must have very high emphasis during QA of technology components released to the base platform. Also stringent performance, scalability and modularity requirements must be specified as the core requirements for all components that get released to the base platform. Generally the code coverage percentage, performance numbers and load capacity must be relatively higher for base platform components compared to application components.

7. Core Platform Release

Platform release process is a discipline to govern the components that gets release into the mainstream base platform. The release process ensures proper change control and configuration management for the components within the base platform. Platform release is applicable to all home grown components as well as 3rd party implementations.

Activities: All/any activities obvious to the release process (as decided by the PDLC) will also be applicable to the core platform release process.

Artifacts: The input and output artifacts will be specific to the QA process as decided by the PDLC.

Key Note: One of the core output artifacts for technology release is the ConfigMap updates of the base platform. Also relevant release notes and risks must be part of the output artifacts. The ConfigMap and risks list will be primary input artifacts for the “technology life-cycle management” discipline.

8. Technology Lifecycle Management

Technology lifecycle management is a discipline in which the base platform and technologies are serviced and maintained throughout the lifecycle of the related components. During lifecycle management, it becomes necessary to identify the primary owner of the relevant technology component throughout the lifecycle of the component. The lifecycle can be broadly broken down into the following three phases:

8.1) Technology Establishment
8.2) Technology Sustenance
8.3) Technology Sunsetting

8.1) Establishment : Within the establishment phase, one need to ensure that all the relevant documents, binaries, source and related artifacts are made available for the appropriate groups (engineering, PSG or partners) to perform business as usual. Typically, developer education activity (walkthroughs, workshops or simple white boarding) is the core concern during the establishment phase.

During this phase, the component that got released into the base platform will encounter a lot of hiccups when engineers and developers start using them for the first time within the product. Even though a comprehensive QA would have been performed on the components, there will probably be some good number of issues and bugs raised by engineers/developers. The primary focus while planning the establishment should be to ensure that the owners of the released components are dedicating there time for smoother inception of the components in any functional/application projects.

During this phase, it is important to establish a strict change management process for any changes requested by the developer community. It may not be necessary to implement all changes into the components immediately. Instead due diligence must be enforced only to feedback critical change request that were overseen during the development life-cycle of the component. Consolidated changes (after analysis) must be routed through further activities of the technology management process block.

Note: Lifecycle management is a sub-process/activity of the Technology Management discipline

Typically the establishment phase would last until the first core product release including the related technology components is made. Generally tag promotions must be used to identify the status of technology components. Mostly the end of establishment phase would promote the components to “production ready” or “established”.

8.2) Sustenance : The sustenance phase of the technology lifecycle is post establishment activity. The primary focus of the sustenance phase is to ensure continued maintenance of the components that were established into the product. Some of the core activities during the sustenance phase can be as follows:

Timely resolutions of external bugs (customer bugs)
External supplementary requirements gathering (Scalability, Performance, Extensibility, Usability, Configurability)
Identify component enhancements
Due diligence on CRs (Change requests)
Consolidation and categorization of CRs, enhancements and other requirements for next version of component.
Component version and release planning
Inputs for component EOL (End-of-life) analysis

There can be multiple minor releases during sustenance but a major release must be fed back through the activities of technology management. Major releases should come through the technology process lifecycle. Deviations of the technology architecture process are quite possible in these scenarios.

8.3) Sunsetting : The sun setting phase is a phase within which the components who’s EOL (End-Of-Life) been identified is eventually phased out of the product. This phase contains the most critical activities which ensure a smoother transition for the product during the component sunset.

The requirements build-up for what components needs to be identified for EOL, is part of the architecture roadmap management discipline. By that, what it means is that, the requirements can arise due to many factors or needs from any discipline, process, dimension or group, but the collection of these requirements and analyzing the requirements to objectively justify that the EOL is in fact necessary, will be part of architecture roadmap management.

The sun setting phase is an outcome of the decision already made during the roadmap management stage where EOL is tagged to the component. This phase will kick start further processes on how-to sunset the components. The what-next after sunset must be already identified during architecture roadmap management.

ESB Primer

2007-01-31T08:27:00.001-08:00

The Enterprise Service Bus (ESB) can be considered a virtual layer composed of a set of services that acts as a broker for “facilitating” SOA integration across all the IT systems and components that can or may possibly exists in an enterprise environment. ESB is a relatively new term emerging in the industry. Yet some of the rudimentary principles on which ESB is based on are relatively old (as in matured). The core objective of ESB is to enable agent based mediation between two service end points to accommodate service integration. To achieve such agent mediated service integration, the ESB uses web service and other integration technologies available. An ESB is not a pure play Web services solution. An ESB repertoire can include all the Web service standards, integration adapters, spectrum of business connectors, enterprise plug-ins to legacy platforms, messaging agents and brokers, process and workflow plug-ins, and message/data transformers. ESB acts as a ubiquitous process integrator to achieve the business service to IT service mapping.

The main objective of an ESB is to facilitate interactions across people, process, application and data. Apart from the integration enablers, ESB is also made up of components that provide intelligence for service integration such as interface transformation, service matching, QoS (transactions, security, addressing, messaging), service level monitoring and system monitoring. Apart from the stated pervasive services endowed by ESB, some of the prevalent service enablement that is possible through ESB are Composite Application Frameworks (CAF) and Business Process Choreography/Orchestration to achieve Business Process Integration (BPI).

CAF is an “execution shell” around applications supporting different business needs to provision an aggregate requirement by sharing the process of all these different applications. For example to achieve a quote-to-cash customer order management, an ERP will typically be integrated to a CRM system. This can be done using either the conventional integration strategies (direct integration) or through CAF. In the conventional itegration strategy, retiring any one of the integrated modules to bring in a newer module will break the overall composite environment. But in CAF execution shell, modules can be plug and played to an extent with comparatively minimal impact than the traditional methods. SeeBeyond’s ICAN suite, WebMethod’s CAF and SAP’s NetWeaver are some good CAF products available. The CAF may internally use a Business Process Choreography framework to enable flexible process orchestration across applications (ERP and CRM from the example) to enable adaptability across changing process components to support the business need (quote-to-cash from example). IBM’s Websphere Business Integration Server is an excellent business process orchestration and execution product available. The Websphere Business Integration Server uses a BPEL engine to achieve process choreography. The SOA and ESB are key enabling technologies for CAF and BPI.

SOA Primer

2007-01-05T07:42:00.000-08:00

Service Oriented Architecture or SOA is an architectural style or design encompassing a set of guidelines, rules or principles that suggests how a software application should be manifested as a service. SOA has emerged as integration architecture to create resilient applications to coordinate with each other and extend the process and execution boundaries across application.

The software service in the SOA is a network endpoint abiding by certain protocols and technology constraints required by SOA. Typically web services technology is used to enable the network endpoints as a software service. The key features of SOA are loose coupling, distributed, application autonomy, programming language agnosticism, data and communication standardization, interface standardization and heterogeneity. All of these key features are enablers for achieving an IT ecosystem which acts as a virtualization layer to support and map the enterprise business objectives to the IT process boundaries.

Web services is a technology specification which details the usage of protocols, communication layers, data standards, network standards, data parsing and binding specifications and conversion standards for a service endpoint. These specifications aid in defining the service interface, publishing the interface and discovering the interface using the standards specified.

Interface definition is achieved through a standard called Web Services Definition Language (WSDL). The WSDL Interface publishing and discovery happens using the communication protocol named Simple Object Access Protocol (SOAP). The target for publishing is a standard named Universal Description, Discovery and Integration (UDDI). The publishing data and grammar is encoded using a markup language named eXtensible Markup Language (XML). Web services also proposes the Quality of Service (QoS) necessary across the web services stack supporting the transactions, security, messaging and addressing protocols for the service end points. Some of the other standards that are of interest are Business Process Execution Language (BPEL), Data Center Markup Language (DCML) and Web Services Composite Application Framework (WS-CAF).

The Fifth Utility

2006-12-15T02:41:00.000-08:00

Utility computing, also often called, as the fifth utility seems to be positioned as the cool new model for enterprise computing. Note that the term computing must not be read as just related to computer as a processing box, but must be generally understood as the ‘business model’ of offering a service. The fifth utility is more about business model based on utility computing rather than the technology alone.

The idea of service provisioning for the clients based on similar grounds such as using electricity service or water, where in clients can consume as much of resources as needed and are only required to pay for what is being used, is considered as ‘Utility Computing’.

So then, utility computing is a “Service Provisioning” model.

Whenever an operation or a service becomes an absolute necessity for an enterprise to function, and the abundance and standardization of such services drives the ubiquity of such service, then, it will make the most sense for an organization to obtain such services from an utility source. (Ex: Electricity)

Any process or offer that can be commoditized as a service can be packaged as ‘probable’ contender for utility computing.

In my view, the utility computing model implies that majority of the services that are ubiquitous across general consumption (e-commerce or enterprise alike) can probable be serviced through a utility computing paradigm.

Such services can then be consumed on a pay-by-the-drink usage model.

Technology (IT) in general can be considered as a usecase for utility computing. IT as a utility is a very highly debatable topic. I do want to suggest that IT as a whole does not fit into the utility model. IT services can be broadly categorized into two systems.

Systems that provide strategic benefits for an enterprise.
Systems, which are ubiquitous across enterprises.

The utility computing model best fits the second category of services. In my view, the utility computing model implies that majority of the services that are ubiquitous across enterprises can be outsourced. Such outsourced services can be used based on a pay-by-the-drink usage model. The idea of paying for using applications or compute resources or storage, based on the pay-by-the-drink model sounds great in theory.

‘But does it really work in practice?’

To arrive at finding an answer to the stated question, we need to understand the concept of a generic utility computing model. Most importantly, we must try to find the candidate attributes of the model that best fit into the description of the model. Eventually, we can contemplate on the practicality of all the variables in the equation that can make the utility computing model usable.

If the fifth utility was to be considered a ‘simulacrum’ then the probable originals could be the following market models:

Search as a service (Google, Yahoo)
Email, News and Hosting as a service (gmail, maps, MySpace, youTube)
Blogging, FeedBurners
CPI, CPA ad models (AdSense, Amazon Affiliate)
Search Marketing, Media and Click Streaming (Akamai, Overture, DoubleClick)
Online Storage (Amazon S3, Gmail plugins)
Decentralization of data (Napster, Gnutella)
Virtualization of systems
Emergence of Web 2.0

The current focus seems to be more towards virtualization of systems as the first step towards utility computing stack. Notice that decentralization of ‘data’ through the usage of torrents or similar P2P networks (Ex: Naptster) is a way towards virtualization of data. Also the emergence of Web 2.0 is pushing the industry further towards ‘Web as a platform’ for provisioning the service. Web 2.0 in general and probably semantic web in particular does and will have more relevance towards offering the services as utility to be consumed over the web. (More about this in later blogs).

There is also a general purpose architecture around utility computing being construed called the SOI. SOI or the Service Oriented Infrastructure is in effect an infrastructure solution to make the SOA happen (SOA: Service Oriented Architecture). SOA suggests that if a offering must be conceptualized as a ‘Service’, then the supporting SOI needs to be in place to allow both offering and consumption to happen.

Note that SOA is a technology architecture to enable LOB applications to work within a composite application framework...

Meanwhile, there is a business side of the SOA and the definition of a 'Service' in the business model is more important than the definition of the 'Service' as explained everywhere while preaching SOA. (Check webservices and SOA keywords while searching for technical definition on Google).

What then makes up a business definition of a Service ?

I will present an over simplified version of the key constituents of a ‘Service’. I will call this the first-set

Service Description
Service Costing and Pricing
Objectives of the Services (Also called Service Level Objectives)
Service Level Agreements

Also for a Service Portfolio

Service Usage and Consumption plan leading to a Service Offer
A Master Service Agreement for a Portfolio of Services

Notice that most of these are also common for service as a utility except that following critical ingredients must be added to the mix (Let me call this the second-set):

Service Metering (or monitoring)
Service Lease Agreement
Service Chargeback or Billing
Regulatory Compliance

It can be a long debate towards concluding whether all services that have the pre-defined drivers/attributes (both the first and second set) can be considered as utilities. I do not have a good theory of my own to present one case or another (will try in further blogs).

There are many frameworks such as ITIL, COBIT etc that deals with the concept of ‘IT as a service’. Most of these frameworks revolve around the first-set of drivers I have presented. The key theme of service provisioning is based on building a Service Catalog and a CMDB (Configuration Management DataBase). The ServiceCatalog and the CMDB in general is a dichotomy built around what they call as the “front office” and the “back office”.

Most of the front office activities are addressed by building a service catalog. This includes creating a service portal as a single pane of glass across functions such as:

Help Desk and Requisition
Self Service
Auditing (for compliance)
Financial Accounting
Relationship Management
Vendor Management (Service)

These can be well managed through the creation of a service catalog and then making the catalog actionable and orthogonal across the stated functions. Companies like newScale and Lontra are in the race to productize the service catalog (Though I must say that newScale has been more widely successful penetrating the market). These companies also have workflow and performer management stack built into the product to address IT service provisioning in particular. In contrast the back office activities such as:

Inventory Management
Service Configuration management (CMDB, Bill-of-Materials)
Capacity Management
Availability Management
Incident and Change Management
Resource Workflows and System Integrations
Vendor management (Configuration)

These are managed by a different breed of systems which are more asset centric and are focused towards system monitoring and event management. Companies such as CA, BMC, HP-Openview and IBM-Tivoli have product stacks around the back office.

This simplification of the service definition also helps us understand that utility definition will not be any significantly different from the functions and operations management of a service, except that not all services are utilities.

Maybe the service catalog can have services that are marked as utilities or maybe there is a different breed of management suite that is required for creating a utility computing model. More research on these thoughts can reveal the plausible theory to be adapted. But, for sure, it is obvious that a utility offering is not possible until the front office and the back office are both an established reality. Saying this, there are still no products that are providing the ‘second-set’ of requirements which are essential and critical for a utility offering to happen. In my opinion, a large vacuum exists in the market space where a product can emerge to satisfy the second-set.

In conclusion, the fifth utility as a simulacrum is still in the making, waiting for the Integration of front-office with the back office through the probable emergence of Web 2.0 based platforms which in turn makes the SOA and SOI to happen. In effect, for the pay-by-the-drink paradigm to work, the critical ingredients from the second-set to emerge as a product that best fits into the overall framework must become a reality.

Saying this, there are some successful emergence of utility based usage of Web Services demonstrated by Amazon on their AWS portal. These are some of the trends worth tracking for the simulacra to emerge.

What is Simulacrum ?

2006-11-12T22:58:00.000-08:00

In simple terms, Simulacrum (plural: Simulacra) is a 'copy' without a 'original'. The definition of simulacra has evolved over ages and specific meanings and connotations has been provided that has varied context across different bodies of work (Doctrine of the 'Eternal Return', The book 'Simulacra and Simulation' ...)

Some context:

Universe being a simulacrum without a original which recurres eternally.
Simulacra of the beings where the copy is true without a model (model being a theory). This has branches of study around semiotics and biosemiotics.
God is a Simulacrum.
A-Life (Artifical Life) is a Simulacrum

"Simulacres et Simulation" a French publication by Jean Baudrillard explores the philosophical juxtaposition of the 'real' and the 'hyperreal'. This philosophy seems to be making sense in the context of the modern world. Even so more applicable to the surrealism of software development practices, religious beliefs, politics, entertainment or whatever discipline one can think of. An interesting quote from Jean Baudrillard states,

"The simulacrum is never that conceals the truth -- it is the truth which conceals that there is none"

The simulacrum is true.

What is of specific interest to me as a author as I conceive it and will continue to blog, is that "Technology is a Simulacrum". The context of technology being that we try to create a copy of 'idealized original'. The idealized original, be it a PRD (Product Requirement Document), Service Requirements for a project or even a perceived market making function of a latent demand of a specific need. In the process we create simulacra, which are imperfect copies of the original and that which is driven by a desire to be like the original or surpass it.

Thinking about it, my blog is a simulacrum of what I perceive, that technology being a simulacra, and is a self fulfilling prophecy of recurrence. So the title "The Simulacrum".

I hope to capture (to my ability and bandwidth that is) my thoughts and perceptions around the assertions, lemma or postulates (being the idealized original) of specific technologies and the simulacrum around the same. I am hoping to stick to this general frame of thought as much as possible during my blogs.

'The hope' being the idealized original prediction and 'the blog' being the simulacrum !

My authorings on Amazon

2006-07-23T14:23:00.000-07:00

Java Web Services Programming

Packed with lucid explanations and lots of code examples, this valuable guide covers the Web services framework and the open standards that support it, including XML, WSDL, SOAP, and UDDI. Learn to implement these standards using the WSDP, from working with the Java Web services architecture and developing JavaServer Pages and servlets to making the most of JAXP, JAXB, JAX-RPC, JAXR, and the rest of the Java XML toolset.

Internet Security and Firewalls
Implementing a firewall is the firs step in securing your network. This book will show you how to construct an effective firewall and teach you other methods to protect your company network. Internet Security and Firewalls gives you the knowledge you need to keep your network safe and gain a competitive edge.