Month: March 2015

A few blogs ago in one titled, “The ODDA Loop,” I commented on one of the scariest moments in my professional career.  A senior officer jumped from his seat during my presentation protesting my comment that utilities move too slowly … sometimes being characterized as “moving in geologic time frames.”  He ended his outburst protest about me exaggerating by stating that “utilities did not move that quickly!”  Besides my relief at his clever and obvious humor, he was certainly agreeing with me.  In life, I often find that these subtle reversals in expressive thought can trigger new insights and approaches.  That is what this blog is about.

A recent article in Energy Central on cyber security suggesting utilities are burying their heads in the sand like ostriches prompted me to check out that phrase for its veracity.  Do ostriches really burry their heads in the sand?  The popular statement implies ostriches bury their heads in the sand when they’re scared or threatened.

According to National Geographic, the reason for the comment starts with an optical illusion.  Ostriches are the largest living birds, but their heads are pretty small. “If you see them picking at the ground from a distance, it may look like their heads are buried in the ground,” says Glinda Cunningham of the American Ostrich Association.  But they do dig holes in the dirt to use as nests for their eggs. Several times a day, a bird puts her head in the hole and turns the eggs. So it really does look like the birds are burying their heads in the sand!

So, lighten up on all those IT folks who are now searching for the perfect way to stop bad guys from doing bad things in a system so complex that no one can truly get their arms completely around it.  As I think about this challenge, maybe they have it all backwards.  Instead of trying to stop those bad guys from getting into their nests and breaking eggs they should hide those eggs.

The analogy here is very simple. Any security expert will tell you that any system can be hacked if someone really wants to get into it.  Often, the biggest threat is the person who designed the security system in the first place and has been fired or been paid by those bad guys enough money to compromise the company they work for. 

Maybe then we should follow the design objective made famous in the line in movie 2001: Space Odyssey. Click here to watch.  Here is the full conversation:

Dave Bowman: Hello, HAL. Do you read me, HAL?

HAL: Affirmative, Dave. I read you.

Dave Bowman: Open the pod bay doors, HAL.

HAL: I’m sorry, Dave. I’m afraid I can’t do that.

Dave Bowman: What’s the problem?

HAL: I think you know what the problem is just as well as I do.

Dave Bowman: What are you talking about, HAL?

HAL: This mission is too important for me to allow you to jeopardize it.

Dave Bowman: I don’t know what you’re talking about, HAL.

HAL: I know that you and Frank were planning to disconnect me, and I’m afraid that’s something I cannot allow to happen.

Dave Bowman: [feigning ignorance] Where the hell did you get that idea, HAL?

HAL: Dave, although you took very thorough precautions in the pod against my hearing you, I could see your lips move.

Dave Bowman: Alright, HAL. I’ll go in through the emergency airlock.

HAL: Without your space helmet, Dave? You’re going to find that rather difficult.

Dave Bowman: HAL, I won’t argue with you anymore! Open the doors!

HAL: Dave, this conversation can serve no purpose anymore. Goodbye.

Perhaps then there is another approach to cybersecurity and the related grid hardening.  Perhaps we need artificial intelligence in the subsystems to detect “intent” and rationalize that instead of hoping we can put enough locks on the doors.  Bad guys still seem to be able to pick those locks or simply blow them off the wall if they want to.

 

I am sure you have all heard the buzz about Apple’s newest gadget: the smart watch. I am also sure you heard the startling news that it may become the most expensive product Apple has ever launched with a price targeted over $10,000 for those who are fashion conscious. This will certainly be fun to watch and to see how it sells. After all, Apple fans are almost addicted to wanting the latest and greatest. Some sign up to be the first for whatever Apple launches as a new product.

I first heard of the concept of a watch that could do more than tell time when I was a youngster and read the Dick Tracey comic strip. He had a watch that could act as a phone. I also remember the series Get Smart, where the bumbling Agent 86, Maxwell Smart, had a phone in his shoe. Seemed pretty silly to put one there, but phones were big and bulky, so I guess a shoe made sense. Apple has certainly revived some memories and made a statement with this latest gadget.

However, there are others who may be a bit fleeter afoot, and who might just upset the apple cart (pun intended). Take a look at this link to see Pebble Time, who just raised almost $20 million to compete with Apple on what appears to be a far more functioning watch and at a compelling price point compared to Apple’s.

Click Here to view the Kickstarter campaign. Keep an eye on this.

Those of you who have followed me for a while know I have been alerting the incumbent utilities to new entrants that can upset their business. If you want to know how, just read the intriguing book I recommended back in 2013, Digital Disruption.

A few weeks ago, I focused on the OODA loop because it seems these companies have mastered it and to compete in this new world, you have to master it too. It is going to be really interesting to see if Apple can pull this new watch off, or if they will pivot quickly using the OODA loop to gain some ground on the upstarts. But, they no longer have a Steve Jobs to frantically drive organizational innovative at top speed.

We ordered some Pebble Time watches just to see how good they are. They are due out this summer, so those of you who run into me may want to see it up close and personal because I will be wearing one. Or, maybe you want to truly run on the wild side and get one yourself, seems like a few others have.

 

We all seem to be customers of Amazon. First, it was books, then CDs and DVDs, and now it is a lot more. To understand this process you really need to read the book-describing founder and CEO Jeff Bezos’s strategy. The book is aptly called “The Everything Store,” and it truly takes you behind the scenes to see his relentless pursuit of owning your buying relationship.
One of the latest Amazon devices is the ECHO. Watch the video on the Amazon site if you aren’t familiar with them. Click here to learn more about the ECHO. 
On the surface, the device seems to be a version of Apple’s electronic personal knowledge assistant, Siri. But, it is much more. On the surface it seems like a really good music speaker. But, once again, it is much more.
Susan and I have our ECHO in the kitchen where we enjoy hearing whatever music we requested played. This “speaker” has revolutionized our listening experience. We no longer go searching for channels, discs, or even a remote. We simply say, “Alexa, Beethoven’s 9th” and the music plays. Need to know the weather, the traffic, who won last night’s game, the area code for Lexington KY, or what year Benjamin Franklin was born? Just ask Alexa. But, there is more.
Our favorite feature is putting items on our grocery list. “Alexa … add olive oil to my shopping list.” And olive oil appears on the list on my mobile phone. Then, at the store, I check the list, and there it is. Simple enough … but wait … there’s still more. Amazon is about to launch home delivery of groceries to many major cities.
That’s right. You can see where this is going. Get ready for Alexa to ask whether you want that shopping list delivered … right now. Why go out to the store? This reminds me of the local office supply store whose representative came to our office to inventory our pens, pads, paper, etc. and to let us know if we were running low. With 30+ employees, who has the time to worry about that? They apparently do … and of course, they then deliver what we need just as any other supply company would do.
They are stepping in and owning the customer experience.
Here is one more example of thinking ahead and working to own the customer relationship that makes this same painful point. It was about 20 years ago that I audited Quaker State Oil’s refinery in Pennsylvania. When I met the plant manager, I commented on how proud I was to do the audit because I had such high regard for and always preferred using Quaker State oil.
The plant manager thanked me for my loyalty, but then asked, “Do you change your own oil?” That question stunned me … he was right … I didn’t. He then told me the refinery was on the verge of closing because their rival Pennzoil had thought this all through and had opened Jiffy Lube oil changing stations to own the customer experience, and they were not buying Quaker State oil.
There certainly is an important lesson here.

Observe, Orient, Decide, and Act in rapid succession.

Oh boy, Joel, are you kidding? How can you blog about something like this to your clients in the energy utility industry? After all, many like to criticize energy utilities for their speed. This is not the electronics, pharmaceuticals, or similar industries.

Perhaps the root problem here is not speed but risk aversion. It seems safer to do nothing than to change and be wrong, even if what we are doing right now is dead wrong. I remember one utility that had the policy that no customer would be promised a new electric service in less than 30 days because that was the amount of time the utility was certain they could achieve. I asked if they could change the policy to be a guarantee of no more than 30 days but the utility would make every effort to beat that date. I made the plea with the obvious benefit that the revenue impacts are better if the meter is set and spinning sooner. The room fell into a cold silence. They simply did not like the increase in risk.

I still remember one management leadership session I ran decades ago where I characterized this and criticized the industry as changing in geologic time frames. To my shock, the ranking executive in the room leaped to his feet and challenged me …

“Mr. Gilbert. I have listened to you for the better part of an hour commenting on our need to listen to our customers and to move quickly to resolve their concerns. I am objecting to your choice of words implying we change in geologic time frames!” … after a seemingly endless pause, he continued … “We don’t move that quickly!”

Obviously, this was a gracious and supportive comment, which I have cherished to this day.

The OODA Loop sounds an awful lot like that old joke about the two guys running from an approaching grizzly bear. The one stops to put on a pair of sneakers while the other asks him why as he keeps running. The answer is of course that the challenge isn’t to outrun the bear but the other person.

The OODA loop was developed by military strategist and USAF Colonel, John Boyd. Boyd applied the concept to the combat operations process, often at the strategic level in military operations. The approach favors agility over raw power in dealing with human opponents in any endeavor. John Boyd put this ethos into practice with his work for the USAF. He was an advocate of maneuverable fighter aircraft, in contrast to the heavy, powerful jet fighters that were prevalent in the 1960s, such as the F-4 Phantom II and General Dynamics F-111. Boyd inspired the Light Weight Fighter Project that produced the successful F-16 Fighting Falcon and F/A-18 Hornet, which are still in use by the United States and several other military powers into the 21st century.

Perhaps then, the key to the future is to focus the organization on OODA. How quickly can you make decisions? How comfortable are you with adjusting your path as new data emerges? Can your organization change its mind without fearing criticism? And, can it truly mobilize and act on the ideas it does decide?

Observe, Orient, Decide, and Act or risk being nullified by others who outmaneuver you. This is the key take-away from the book I recommended in last week’s blog, The Creator’s Code. It’s a must-read for anyone working to innovate in our industry.