This is somewhat of a pre-emptive posting in case I miss Tuesday’s class. I will still try to post if I do make it to class though. Something I talked about in my blog before came up in class regarding the enforcement by second or third parties. It has to do with the amount of lies written in email compared to when written on paper. I think that this is exactly the reason why people should not believe much of what is said online, possibly unless there is some sort of community enforcement as on Wikipedia. It’s an interesting tradeoff where we have access to unimaginable amounts of information, but the quality of that information is always questionable.
The next point has to do with the evolution of media organizations. I think that many older media people are scared that the internet will replace them. However, I see the same or a greater need for media to perform a trustworthy analysis of the information available to the world to make that information actually useful to people. In other words, it could be argued that the core function of the media is to wade through the information out there and present only valid and trustworthy information to their clientele. I think that establishments like the Wall Street Journal are good examples of how reliable information can still draw in revenue in the face of the internet. However, I think that media companies do not realize the importance of reliable information. I’ve seen many TV channels use blogs and random people’s opinions and present them as “news.” I think that individuals will stop going to those media sources if they continue to provide this type of information. Therefore, media companies need to realize or choose what kind of media they provide and make a commitment to providing that quality level of information. Otherwise, they will be swallowed up by the new generations of technology.
Saturday, February 28, 2009
Thursday, February 26, 2009
2/24
I found it interesting when we were talking about the need for society and how the virtual worlds satisfy that need. I think people are wired to be around other people and when we spend most of our time alone at home, we feel that something is missing in our life. I think this is why the need is created for people to feel part of a community, but I don't think that a computer community actually fulfills this need completely. I think that it's close and can satisfy certain psychological needs, but as seen with the girl who committed suicide, it is not always real and people can be fooled into false comfort.
Another similar topic is the idea of checking the email or facebook, but not getting a response. I've read a while ago that people have a need for positive stimulus and they get a positive stimulus by receiving an email/message. They also get a negative stimulus when they check and no one has written them. Therefore, this creates a desire to increase the number of friends on facebook or the number of messages they send out so they receive a message every time they log in. This leads to two effects. The first is that people (usually young people that do not understand) tend to invite or engage in communication with anyone who will listen. This is why they get into trouble because they communicate with strangers and people they don't trust. The second is that if you sum the stimuli, there is actually a negative net effect meaning that people tend to log in and not have a response more times than receiving an email. This also has to do with the fact that the negative is stronger than the positive. Therefore, people tend to be less happy by checking their email all the time because they expect to find a message every time. Anyways, I just thought it was a very interesting study and it shows how emotional needs can really influence people's behavior as well as be influenced by their surroundings.
Another similar topic is the idea of checking the email or facebook, but not getting a response. I've read a while ago that people have a need for positive stimulus and they get a positive stimulus by receiving an email/message. They also get a negative stimulus when they check and no one has written them. Therefore, this creates a desire to increase the number of friends on facebook or the number of messages they send out so they receive a message every time they log in. This leads to two effects. The first is that people (usually young people that do not understand) tend to invite or engage in communication with anyone who will listen. This is why they get into trouble because they communicate with strangers and people they don't trust. The second is that if you sum the stimuli, there is actually a negative net effect meaning that people tend to log in and not have a response more times than receiving an email. This also has to do with the fact that the negative is stronger than the positive. Therefore, people tend to be less happy by checking their email all the time because they expect to find a message every time. Anyways, I just thought it was a very interesting study and it shows how emotional needs can really influence people's behavior as well as be influenced by their surroundings.
Friday, February 20, 2009
2/19
The concept of ecommerce and internet business has always been interesting to me because the internet is a way, in my opinion, to create a much more efficient market because it reduces transaction costs by increasing the exposure of commercial parties. In other words, the traditional idea of a firm being a collection of long-term contracts starts to diminish as the internet allows firms to conduct business extremely easily. The theory is basically that individual agents in the economy would form firms that denoted a long-term commitment to doing business together, which basically meant they didn't have to negotiate terms for every daily task. With the internet, however, most of these negotiations can be extremely low cost because of the efficient market presented by practically everyone in the marketplace, at least for certain functions. For example, if I wanted someone to manage my HR, I would have to hire someone before because I could not be sure I could negotiate the terms each time I use the services. However, when there are multiple companies that I can outsource these functions to and the internet allows us to enact that transaction immediately, I can rely on a day to day (or at least more flexible) contract process to get work done. I find it interesting because I think that transaction costs and the adverse bargaining powers that are created by those transaction costs cause much of the economic inefficiencies (Coase theorem) in the market and the internet might be a way to eliminate some of those problems.
This is related, but I am also interested in how consumer spending is affected by the internet. There are two sources of online spending: replacement spending from brick stores, but also an increase in the turnover of money or the money velocity caused by having ready access to easily spend money online. Basically, before the internet it was "harder" to spend money because the person needed to incur significant transaction costs to go to the store, carry the goods home, etc. However, with the internet, you can spend money at the click of a button. You might pay for shipping, but fairly minimal. This causes the ability to turn over a dollar many more times each year because many agents are doing the same. So I sell something online and I immediately use that money to buy something online and that person immediately uses that money to buy something etc. The statistics indicate a huge spike in velocity in the 1990s, which I would attribute to the availability of the internet. Granted, the monetary policy should try to compensate for this effect because it will cause inflation. In sum, I think that the internet is changing gradually with the older generations, but will drastically change the economy and the way people do business as generations who grew up with the internet enter the workforce.
This is related, but I am also interested in how consumer spending is affected by the internet. There are two sources of online spending: replacement spending from brick stores, but also an increase in the turnover of money or the money velocity caused by having ready access to easily spend money online. Basically, before the internet it was "harder" to spend money because the person needed to incur significant transaction costs to go to the store, carry the goods home, etc. However, with the internet, you can spend money at the click of a button. You might pay for shipping, but fairly minimal. This causes the ability to turn over a dollar many more times each year because many agents are doing the same. So I sell something online and I immediately use that money to buy something online and that person immediately uses that money to buy something etc. The statistics indicate a huge spike in velocity in the 1990s, which I would attribute to the availability of the internet. Granted, the monetary policy should try to compensate for this effect because it will cause inflation. In sum, I think that the internet is changing gradually with the older generations, but will drastically change the economy and the way people do business as generations who grew up with the internet enter the workforce.
Thursday, February 19, 2009
2/17
We only briefly touched this topic in class, but it also has to relate to a discussion I had recently with an engineering friend of mine. The topic is the short-term focus of results or outcomes either in a business or in a personal setting. In class, the point was brought up that projects need to demonstrate the ability to produce value and recoup the initial outlays very quickly. I think this has become a very big problem in our society. Before computers, people had to do that math or statistic by hand. This meant that when a supervisor wanted a statistic or an analysis of some kind, the turnaround might be three or four days. With modern computing power, many of those tasks involving calculations would take mere minutes, basically the time it takes to enter the data into the computer. An engineer uses calculations on a daily basis, but the main part of his job is to come up with solutions that go beyond the calculations themselves. His supervisors complain because they expect things immediately because that’s what they are used to. I think that our society has come to expect things in unreasonably short time periods, both at the job and at home. I thnk I talked about this before in my previous blog, but I thought I would relate this point as well.
Another part of this conversation was interesting because it basically describes the difference between explicit and tacit knowledge. The explicit knowledge was easily analyzed just by plugging it into the computer and figuring out the formula for the desired metric or statistic. However, the problems involving tacit knowledge are not easily or at least quickly solved. This takes time and the person trying to solve that issue would not be able to codify why or how they do so.
Finally, I don’t necessarily think that the two forms of knowledge are exclusive of each other. In other words, I think that some knowledge that is tacit can be turned into explicit with the proper complex analysis and understanding. However, I also think that the human brain is much more complex than we give it credit for. This means that, even though I think it may be possible one day to turn knowledge from tacit into explicit, we are far from understanding how the brain works and why people behave the way they do.
Another part of this conversation was interesting because it basically describes the difference between explicit and tacit knowledge. The explicit knowledge was easily analyzed just by plugging it into the computer and figuring out the formula for the desired metric or statistic. However, the problems involving tacit knowledge are not easily or at least quickly solved. This takes time and the person trying to solve that issue would not be able to codify why or how they do so.
Finally, I don’t necessarily think that the two forms of knowledge are exclusive of each other. In other words, I think that some knowledge that is tacit can be turned into explicit with the proper complex analysis and understanding. However, I also think that the human brain is much more complex than we give it credit for. This means that, even though I think it may be possible one day to turn knowledge from tacit into explicit, we are far from understanding how the brain works and why people behave the way they do.
Tuesday, February 17, 2009
2/12
As I was not in class, I will discuss something I noticed about the reading. Breaking up services into modules can be a very efficient way of doing business. However, I think it also deserves a note of caution when you automate business functions beyond the functional capabilities of the individuals doing the work. For example, if you automate a mortgage issuance, the person issuing the mortgage will think less critically about the outcome. On the other hand, a person who does not use any automation will need to do the analysis themselves and will have a better understanding of the consequences of default. I think this was part of the problem with the mortgage crises in that people thought that the models were to be trusted and did not take the personal responsibility of issuing the mortgage. We should not make the same mistake in other applications of service technology.
I think that technology is a wonderful thing, but as we have reiterated many times in class, it must be where technology and business intersect. I found it very interesting that the two top drivers for the SOA projects were "need for change" and "competitive pressures." Neither of these seem to be matching the technology to the business application. Rather, they both seem like managers of the firms are looking for quick fixes to either gain a competitive edge or because they feel they need more technology. Firms should choose the technology based on how that technology can help their business practices or improve their business practices. This seems to be the reasons behind the other drivers (collaboration, demand) because those deal with communication and computation. In sum, I'm not really sure what was the reason behind those firms choosing SOA projects, but hopefully they're doing it for the right reasons.
I think that technology is a wonderful thing, but as we have reiterated many times in class, it must be where technology and business intersect. I found it very interesting that the two top drivers for the SOA projects were "need for change" and "competitive pressures." Neither of these seem to be matching the technology to the business application. Rather, they both seem like managers of the firms are looking for quick fixes to either gain a competitive edge or because they feel they need more technology. Firms should choose the technology based on how that technology can help their business practices or improve their business practices. This seems to be the reasons behind the other drivers (collaboration, demand) because those deal with communication and computation. In sum, I'm not really sure what was the reason behind those firms choosing SOA projects, but hopefully they're doing it for the right reasons.
Tuesday, February 10, 2009
2/10
I think the argument about the enterprise application is a little more nuanced than was presented in class. I think that there are problems at both extremes and the best value for a company is how to balance those extremes and fit exactly what the needs of the company are. I think that having one enterprise-wide system can be very efficient and good if the different groups within the company work together. On the other hand, there can be situations where the groups within a company should not be integrated and the independence creates benefits in that business mode. Said in another way, centralized systems work well for some, but decentralized systems work well for others. I think the same is true for technology solutions. We talked about intimacy and knowing the customer in class and I think that whether the technology is an enterprise-wide integration or buying the “best of breed” for each function, it really depends on the needs of the company. I think that when applications fail, it is really about culture. However, it is not always about an inability to adopt the technology. A new technology could cause a company to have to change its culture and that culture might be the source of their competitive advantage.
Another aspect of the technology that was briefly mentioned is the inability of many works to actually use the technology available to them. Technology has increased the capacity beyond the practical business application because many workers cannot use the technology. Also, the computing capacity of most computers is way beyond what most people would do in a given day, even if they know how to use it. Yet, computer companies are constantly upgrading and making new features. Granted, there are people that might need this increase, but for the most part, our tools greatly exceed our needs. I think that much of this innovation is because of matching the business needs, but the technology is only as good as the person who uses it. The theme of the class is that the intersection of business and technology drives innovation. It’s interesting because I would perceive almost all of the innovation being made only at the margin or the high-intensity users of technology.
Another aspect of the technology that was briefly mentioned is the inability of many works to actually use the technology available to them. Technology has increased the capacity beyond the practical business application because many workers cannot use the technology. Also, the computing capacity of most computers is way beyond what most people would do in a given day, even if they know how to use it. Yet, computer companies are constantly upgrading and making new features. Granted, there are people that might need this increase, but for the most part, our tools greatly exceed our needs. I think that much of this innovation is because of matching the business needs, but the technology is only as good as the person who uses it. The theme of the class is that the intersection of business and technology drives innovation. It’s interesting because I would perceive almost all of the innovation being made only at the margin or the high-intensity users of technology.
Thursday, February 5, 2009
2/05
It was very interesting how the concern of theft had very little to do with the actual assets that would be taken, but rather concentrated on the IP contained within. This makes sense when we discussed the effect of globalization and increases in technology where basically the aspects of a business that would make it profitable were human capital and technology. Basically, as long as the people are not hurt and the IP is not compromised, the core strengths of the business are still in tact.
The mention of perpetuity and long-term multi generational growth of a company was also interesting . I think that our culture has developed a very short-term outlook on many aspects of life, which has certain consequences. This has had an effect on long-term investments in property and in sustainability projects. For example, a hundred years ago, a person might plant a tree that would take thirty or forty years to grow, but they knew their children or grandchildren would receive the benefits. However, it is a very low chance now that someone will be living on the same property for the rest of their lives, not even thinking about children. Therefore, people choose not to invest in long term projects. I think that there is a basic problem that people do not look into the future while making decisions, such as the level of waste that is produced by an average household. We need to start thinking in terms of multiple generations ahead of us or else those generations may not be able to exist.
The mention of perpetuity and long-term multi generational growth of a company was also interesting . I think that our culture has developed a very short-term outlook on many aspects of life, which has certain consequences. This has had an effect on long-term investments in property and in sustainability projects. For example, a hundred years ago, a person might plant a tree that would take thirty or forty years to grow, but they knew their children or grandchildren would receive the benefits. However, it is a very low chance now that someone will be living on the same property for the rest of their lives, not even thinking about children. Therefore, people choose not to invest in long term projects. I think that there is a basic problem that people do not look into the future while making decisions, such as the level of waste that is produced by an average household. We need to start thinking in terms of multiple generations ahead of us or else those generations may not be able to exist.
Sunday, February 1, 2009
1/29
One aspect of future business where our class clearly disagreed was whether business will become more or less integrated. My original opinion was that business would be more integrated because we’ve seen shifts towards the one-stop-shop box stores of Walmart and Target away from purchasing our goods separately from the butcher, veggie stand, and other “specialty” stores. However, as I thought more, many modern companies and organizations have also become less integrated and rely on a network of extremely specialized entities. The example in class was Eli Lilly, where people who are not part of the regular R&D team are provided incentives to innovate, but are not integrated into the entire organization. The company, who specializes in manufacturing, basically outsources the research process to those who specialize in research. This is specialization at its best. In conclusion, I think that there might be a polarization. I see a trend in integration of networks (distribution markets, corporate conglomerates, social behavior, etc.), but specialization in specific skills (research and design firms, outsourcing non-core functions, etc.).
One thing that will shape our future is personal choice. Our class discussion revolved mostly around how technology will improve business or standard of life in the future, but did not address how people will choose to embrace the technologies. The economist in me wants to say that everyone makes the “correct” decision by balancing short-term interests and long-term interests. However, I believe that after the fact, most people would not have made the same decisions if given a second chance after the fact. For example, we are, supposedly, more “sophisticated” now than at any other time in history in food and nutrition. However, this generation is the first in history that has a life expectancy lower than the previous generation, due primarily to obesity. The increased knowledge helps us understand what can help the body, but it also provides the ability to consume much more fat, salt and sugar than previously available. I would argue that the shorter life span is because of personal choice and preferring the short-term enjoyment of the fat, salt, and sugar over the long-term interest of living a long and healthy life. I would think that people at the end of their life would prefer to live longer years rather than eat the fat, salt, and sugar (this can be debated). My point is that advances in technology or knowledge are only good if they help humans achieve what we really think is worth achieving. This opens up an entirely different debate, which I will not continue today.
One thing that will shape our future is personal choice. Our class discussion revolved mostly around how technology will improve business or standard of life in the future, but did not address how people will choose to embrace the technologies. The economist in me wants to say that everyone makes the “correct” decision by balancing short-term interests and long-term interests. However, I believe that after the fact, most people would not have made the same decisions if given a second chance after the fact. For example, we are, supposedly, more “sophisticated” now than at any other time in history in food and nutrition. However, this generation is the first in history that has a life expectancy lower than the previous generation, due primarily to obesity. The increased knowledge helps us understand what can help the body, but it also provides the ability to consume much more fat, salt and sugar than previously available. I would argue that the shorter life span is because of personal choice and preferring the short-term enjoyment of the fat, salt, and sugar over the long-term interest of living a long and healthy life. I would think that people at the end of their life would prefer to live longer years rather than eat the fat, salt, and sugar (this can be debated). My point is that advances in technology or knowledge are only good if they help humans achieve what we really think is worth achieving. This opens up an entirely different debate, which I will not continue today.
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