My Lost Years Without Desi Ghee

From The Guardian

Butter, cheese and even red meat are not as bad for the heart as has been maintained, a cardiologist has said in a leading medical journal, adding that it is time to “bust the myth” of saturated fat…
“Recent prospective cohort studies have not supported significant association between saturated fat intake and cardiovascular risk,” he argues. “Instead, saturated fat has been found to be protective.”

Doctors and scientists are now ready to proclaim that saturated fats are good for you. Not just OK, but good. Better than those sucky unsaturated fats we’ve been using all these years. This is not just the opinion of one diet guru somewhere. There are now many studies and meta-studies (apparently that is a thing where you study other studies) that conclude that saturated animal fats of the kind found in butter and lard do not lead to heart disease.

Now I’m not a science hater. In fact some of my best friends are scientists. My father was one. And I do understand that paradigm-shifting is in the nature of scientific revolutions. (There is actually a book by Thomas Kuhn, sitting on my shelf, that explains all this. It is an important book, though totally unreadable.) For example, at one time Neanderthals were supposed to be cousins of us homo sapiens but from a branch on the family tree that died off before we hit the scene. But with more fossils and genome analysis it has emerged that homo sapiens were contemporaneous and interbred with the Neanderthals and we all now carry Neanderthal DNA. Delightful shift in paradigms, no? Though a little embarrassing for those people who used the word “Neanderthal” to describe certain people at work.

But I have no problem that 2.7% of my genome is Neanderthal. I’m pretty liberal that way. On the other hand, this latest round of myth-busting, paradigm-shifting science about saturated animal fats has gotten me terribly depressed. To think that all my adult life I have substituted margarine for butter and Crisco for desi ghee fills me with great regret.

I grew up in a place called Hisar, in the state of Haryana, India. Hisar was the proud seat of Haryana Agricultural University. My father was a dairy scientist and a professor of animal nutrition in the College of Animal Sciences.

For those of you who aren’t as familiar with Haryana, it is an Indian state neighbouring Delhi that is famous for many things including Haryanavi, a bold, assertive dialect of Hindi that you will often hear in Bollywood movies used by thugs and comedic policemen.

new milk chart

But the thing that Haryana is most identified with is milk. The state poet Uday Bhanu Hans has described it thus, Desan mein des Haryana, jit doodh dahi ka khana. Which is too deep to translate into English, but roughly means that Haryanavis like their dairy products.

In this state, in its only agricultural university, in its college of animal sciences, my father was a professor of animal nutrition. My connection with livestock and milk was visceral. Literally. Besides spending many a Sunday at the University farm (see photo), I consumed copious amounts of milk and dairy products.

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Ghee, or clarified butter, is the pinnacle of a Haryanavi’s connection with milk. It is its most refined, celestial form. It goes into the havan fire as an offering to the gods. It also goes into every edible thing imaginable. And if you can’t do without it, mixed with some milk, it can be had straight from the glass, between meals.

In the bazaar ghee was often referred to as Shudh Desi Ghee. “Desi” separated it from that evil concoction of hydrogenated vegetable oils called Dalda. And “Shudh” was well, pure. Some halvai’s would mix in a bit of Dalda since it was much cheaper. But not this halvai.

All through our childhood, we had lots of ghee. But as an adult who made responsible health decisions, I reduced and then completely stopped having ghee. We cooked in vegetable oil and ate sukhi roti. I pined for ghee, but knew that she wasn’t right for me. For twenty years now, I’ve been living a sukhi zindagi, thanks to faulty science. I may find it in me to forgive her in time, but this is not one to forget.

On the bright side, I should still be thankful that I have the rest of my life to enjoy ghee. Just imagine if I had died before the saturated-fat-is-bad paradigm had shifted. To have gone through my adult life without ghee, only to have it poured on my funeral pyre would have been such a travesty.

And now that ghee and butter are good, what about bacon?

Government Mass Surveillance Will Create a Surge in Technology Spend

How the NSA hacked Google in one simple graphic. Photograph: Washington Post

The Guardian has a presentation called The NSA Files that is the most brilliant rich media presentation of a complex subject I have ever come across outside of a museum. So go read it, even if it is just to see the presentation.

As technology races ahead, from time to time public debate and the law of the land must catch up to it. Government surveillance is one of the most important technology issues of our times. In the US, the NSA files have already had a profound impact on the perceptions of Americans about surveillance and civil liberties. Outside the US, Germany is aghast that the US and UK, NATO allies would spy on Angela Merkel and Germany. On the other hand, there is some evidence that the NSA has aided in combating Mexican drug cartels and prevented terrorism.

The political issues surrounding mass electronic surveillance are complex and do not lend themselves to quick fixes. The issues at stake involve civil liberties, anti-terrorism efforts and international spying, among other things. It might take a decade of public education and wrangling in courts, legislative bodies, NATO and perhaps even the UN, before policy, practice and the law around surveillance settles down.

Leaving aside the political issues, the NSA files will feed a long surge in surveillance and anti-surveillance technology. Snowden’s leaked files are like the Trinity test – the first detonation of a nuclear bomb. Prior to that governments knew that a nuclear bomb was feasible and some were feverishly working on making one, but the public did not really know much about it. The Trinity test, first brought the power and potential horror of a nuclear bomb to the attention of people around the world. And just like Trinity set off a nuclear arms race that lasted for decades, the NSA files will set off a “Snoop Brawl” which will lead to a burst of technology spending around the world. But unlike the nuclear arms race, which was a race principally between nations, this Snoop Brawl is going to be multi-faceted; many players and many fist fights.

Country vs Country
Countries now realize, if they hadn’t actually known it all this while, that the NSA gives the US almost unfettered access to their secrets – those of their governments, politicians and companies. Dilma Roussef, Petrobras, Ban Ki-moon and Angela Merkel were all targets of the NSA; none of which can be justified by national defense. Surveillance is not a single-purpose (e.g. protect the country against terrorism) tool. It is an arsenal of weaponry to project a country’s power and further its interests. And no country has a bigger arsenal than the NSA.

Not China for sure. A few months back, China was pilloried for not doing enough to stop Chinese hackers, allegedly sponsored by the Red Army. That doesn’t seem so egregious anymore. If all major countries decide to bolster their electronic espionage and counter-espionage capabilities, that itself is going to be a lot of hardware, software and thousands of tech jobs.

Country vs Citizens
The NSA collectes metadata on all phone calls in the country – who called whom, when and from where. It is easy to see how this data could be very useful in tracking the networks involved in illegal activity. Or political opponents. If information is power, this is the hammer of Thor (Thor 2 was so-so by the way). Which country that isn’t shackled by its laws, can pass up the opportunity to gather this data?

Outside of a few advanced democracies with active civil liberties protection groups, there is no countervailing force to stop a government from collecting and using this data. The only hurdle is the technology and skills to mine a massive data set like this. Which money can buy. Expect countries to spend a lot on this and other Big Brother technology.

While this gives the government a valuable instrument to catch the bad guys, the very same instrument, in the wrong hands could be used to suppress democracy itself. Or give more power to despots. Expect big orders from tin pot dictatorships as well as big nations where ruling classes are trying to quell democracy.

Companies vs Governments
The US is a hub for internet companies and cloud companies that carry the private data of people and businesses around the world. Much of this data travels through pipes in the US or sits in databases controlled by US companies. Courtesy of Snowden now the world knows that US companies have been cooperating with the NSA with no disclosure to the customers.

European and other advanced nations are likely to enact laws that prevent companies like Google and Apple from becoming listening posts for the US. They may require these companies to “fragment their clouds” and keep the data of their, say, German customers in Germany with restrictions on who can this data be shared with.

On the other hand, companies like Google will have to work hard to regain the trust of their customers. Google is already taking measures to prevent the NSA from eavesdropping without them knowing. Apple is making noises that they might challenge the legality of not allowing them to disclose when information has been shared with the government at their request.

Companies vs Companies
The other things that all companies will realize – not just cloud companies with user data – is that their IP is not safe. In the past year, the Chinese hacking incidents being reported have already raised awareness of this issue. But what the NSA files make clear is that ethics and national interest seem to have no intersection at all. Every country may be spying on foreign companies that can bring value to leading companies in that country. Protection of IP and confidential information will become a key concern for companies. Much more than it is today.

Consumers vs Companies and Governments
Consumers are going to increasingly want to know how their communication and confidential information is protected by online services. Now that they know that “Enemy of the State” is for real what steps should they take to protect themselves? Encryption and information security are complex technical issues which most people don’t understand or even care about. Perhaps there is a need for “information security rating agencies” that rate online services on how they protect users’ confidential data – from hackers and governments everywhere. Perhaps people will increasingly want to roll-their-own email rather than use Gmail or Yahoo mail.

Like the nuclear arms race, the Snoop Brawl will create a flood of spending from both governments and companies. And exactly like the nuclear arms race, it leaves no positive impact on the human condition.

Writing Simply

economist cover-1Greg Mankiw writes about a carbon tax in the New York Times. Whether or not you agree with the economic arguments for the tax, it is easy to agree that Mankiw writes very well. Mankiw is a Professor at Harvard and was the Chief Economic Adviser to President George Bush. You would expect him to be quite an authority on economic theory. But in this piece he explains a complex matter in a way that a high-school kid would understand it.

Writing simply is a craft. It requires hard work and practice. James Thurber, an American writer and humorist, was known to go over his writing again and again until he was satisfied that it was clear and simple. His “My Life and Hard Times” was a book that I read and reread, again and again, as a child – and still can, as an adult. It is a timeless classic.

Writing simply requires expertise. You can’t be clear and simple in your writing until you are clear about the subject in your head. Writing simply isn’t the same as writing about simple things. Richard Dawkins has written volumes of erudite stuff about evolutionary biology that is completely accessible to people with no more that high-school biology.

On the other hand, there are all manner of experts who hide behind a facade of jargon and what Thurber calls expression-complexes. Referring to psychoanalysts Thurber says:

…I have discovered that they all suffer from one or more of these expression-complexes: italicizing, capitalizing, exclamation-pointing, multiple-interrogating and itemizing…It is a defense mechanism used to cover up a lack of anything new and sound to say on their favorite subjects, and to make up for an inability to write simply and convincingly, or to think clearly.

Writing simply often requires having an opinion. The reason I like the Economist or Om Malik, is because they generally don’t waffle. You know where they stand on issues. The cover page of the Economist and its headline leave you in no doubt about their position on Syria.

Writing simply is risky. If you are wrong with your facts, you can’t hide behind a possible misinterpretation. If you are wrong with your opinion (like the Economist was, by their own admission, on Iraq) someone will call you out.

When that happens, you go back to your blog post and admit that you made a mistake. Right there, next to where you made it. In italics, so nobody misses it. And then continue to write the way you want to.

Cloud to Enterprise: Resistance is Futile

Borg Collective

At the end of its Journey to the Cloud, will an enterprise still be running its own data center?

Perhaps, but if it does, it will be much, much smaller. It will be the Private Cloud part of a Hybrid Cloud that will run only a small portion of enterprise workloads. On the other hand, many enterprises will live entirely in the Public Cloud.

Consequently, most of the enterprise data center capacity in the world will disappear, assimilated by the Borg, that is the Public Cloud.

Why is the gravitational pull to the Public Cloud so strong?

One reason is that the price-performance of the Public Cloud is much superior to that of a dedicated data center, even one with Private Cloud. And the gap is widening all the time.

At the heart of this price-performance advantage is scale and specialization. The kind that takes Public Cloud service providers to places like Prineville, Oregon to build massive chiller-less data centers with custom-built servers.

Facebook’s done exactly that. There is a fascinating, if somewhat dated piece in Wired magazine, which goes into a lot of detail on Facebook’s data center in Prineville. Needless to say, the scale and level of specialization is such that every single element of cost and energy coinsumption is highly optimized. Not something an average enterprise can or should be spending their time on.

Facebook’s not an enterprise cloud service provider (yet?). But Amazon, Google, Salesforce.com and Microsoft will undoubtedly have the same laser focus on cost and performance.

Cost advantage also comes from “pooling” – the simple notion that the capacity required to run a pooled data center is less than the sum of the capacities of the individual data centers. Pooling is a powerful cost driver in many services from electric power to limo services. It has nothing to do with specialization, but the cost savings are quite real.

But it’s not just about price-performance. Over time, specialized cloud service providers will add product features that will simply make them better. Or allow customers to do things they couldnt do before. Big Data is certainly shaping up to be one of those areas.

This has happened before. A close analogy would be how Salesforce.com started out by being the cheaper, easier to implement SaaS competitor to on-premise CRMs, but is now functionally a superior product.

Better price-performance and superior feature-function may be quite enough to explain the exodus to the cloud. But there is actually an even bigger force at play here. Something that doesn’t lend itself well to ROI calculations, but nevertheless, CEOs understand it very well.

Running a data center is not core to any large enterprise. Its business is selling widgets or serving customers. And for it to be the best in the world at what it does, it needs to focus on what makes it good. Running a data center is not one of those things.

Which is why if I was a data center today, I would be saying my prayers. Resistance is futile. Prepare to be assimilated.

I Want My Customer Data

Tug of War
For the last few years, I have been using Mint (mint.com) to keep track of our household expenses. My needs are very simple. I want to be able to answer simple questions like “How much are we spending on regular monthly expenses?” and “How much is going towards discretionary expenses like eating out?”.

But I find it difficult to answer the simple questions above. It takes a lot of time and effort to get to a point where I can say that I am reasonably close to the real answers to these questions. As I describe the problems that make it so time-consuming, it actually throws light on a new battleground for consumer services – customer data in the hands of customers.

Except for a tiny fraction of cash expenses, all of our expenses are in the form of transactions – debit cards, credit cards, electronic transfers, bill pay transactions, and yes, a few, hand written checks. We try to keep things simple so we don’t have too many accounts. All these accounts are hooked into Mint. Mint pulls all these transactions so that I can see everything in one place. So far so good.

To get a handle on our household expenses, each transaction needs to be categorized correctly into categories like Entertainment or Restaurants.

That’s where the problems start. Every time I log into Mint, I have a whole bunch of transactions that are labeled “Uncategorized”. I then have to manually go through each transaction, try to figure out the merchant to whom I made that payment and then categorize it. Often, the name of the merchant is completely garbled. If my wife made the payment, I have to wait for her to be around so I can ask her. It takes time and is annoying as heck.

It shouldn’t be that difficult to get this right. A typical card transaction is passed from acquirer to network (like Visa) to issuer (my bank or credit card company) and then to Mint. On the way, nobody seems to care enough to categorize the transaction intelligently, and ensure that the merchant name is represented correctly. It’s all left to Mint to do whatever it can with the data it has.

Mint tries. It allows you to categorize recurring expenses automatically. But non-recurring expenses are far too high in our family to ignore. Mint uses very little intelligence to extract the meta data from transactions. A typical transaction would show up on Mint like so

CHECK CRD PURCHASE 02/18 LYFE KITCHEN OF PA PALO ALTO CA 434256XXXXXXXXXX 08304975697XXXX ?MCC=5812 on Feb 19

In this case Mint extracted the merchant name as “Lyfe Kitchen Pa” (correct) and tagged it “Uncategorized” (missed opportunity).

It so happens that the string “MCC=5812″ refers to the Visa merchant code for “Eating places and restaurants”. A simple google search will tell you that. Why Mint would choose to leave it Uncategorized is difficult to fathom.

In other cases, while extracting the merchant name it applies no intelligence, it appears. It just pulls out the first two or three words that are not numbers. It typically fails for merchants like 23andMe or 37 Signals or 76, the gas station.

Ultimately, no one in the entire chain of merchant-acquirer-network-issuer/bank, all of who are making money because I am spending, care enough to do anything with my data, except the bare minimum to complete the transaction. They don’t recognize the value that I put in my data. Mint does. Which is why I spend a lot more time on Mint than on my bank account website. But even Mint doesn’t do enough.

Next, consider Simple (simple.com), a new banking service that I started using a few months ago. It is still by invitation only but if you can wangle an invitation, you won’t be disappointed.

Activity | Simple

This is a screenshot of what I might see on the Simple website. Simple extracts the merchant name quite well. And the automatic expense categorization works quite well. I don’t know how it does it, but I have never had to go in and change the category on a transaction. In fact if I had to, I wouldn’t know how to do it.

But that’s not all. It will put the address on a little embedded google map. That can be a big help in identifying where you were. If you went to a restaurant, it will tell you how much you tipped.

It’s not perfect, but I feel like they are putting the information that they have to the best possible use. To do more, they would have to get more information from upstream sources over which they don’t have much influence.

I have been comparing Simple with Mint which may not be a fair comparison. Simple has to deal with its own transactions (bill pay or their own debit card). Mint aggregates across many different sources of transactions each presumably with its own idiosyncrasies.

But if you were to compare Simple with any other bank that I am aware of, the difference in the use of customer data (and user experience) is vast. It is light years ahead.

Consumer services today offer a lot of choice. One of the most important ways in which consumer services will compete with each other is what they let their customers do with their data. For a long time, the focus of these companies has been on the use of customer data to extract insights for themselves – how to cross sell more, how to identify loyal customers to serve them better and so on. But this is different.

Customer expectations are rapidly changing. They are being shaped by companies like Apple and Amazon.com that set the standards, not just in their industry, but across industries. Customer data is now part of the customer experience. This is the new battleground.

So what are these customer expectations? Here are mine:

1. That my service provider will obtain and share the data with me in a timely fashion.

I’ll illustrate this with an example. Today’s smart meter technology allows my utility to obtain the power consumption at my home in at a resolution of 15 mins. At this resolution, the data can tell me a lot more than what my monthly bill tells me, which is almost nothing, other than the fact that it is high or low. (Currently mine is running too high and I don’t know why!)

But deploying smart meters costs money. Lots, in fact. Will it be worth it? It might have been hard for utilities to justify the cost. After all, they are all monopolies. Luckily, regulators in most advanced nations have been nudging utilities in that direction.

In every industry, there will be similar challenges. How do you justify the cost of gathering more data that is useful to the customer? Expecting new revenue from additional services to justify giving customers more data may be too short-sighted.

2. That my service provider will understand that that data is mine.

I shouldn’t have to pay just to get that data. Although I will gladly pay for a service using that data that is of incremental value. I should be free to take that data out myself, or allow another service provider to pull it out on my behalf.

Today, my bank charges me a fee if I want to see a used check image older than 6 months. Tax filing time must be quite profitable for the bank. I don’t have a problem with the bank trying to turn a profit. But not on my data. If your storage costs are too high (really?) allow me to easily export it to my Evernote or DropBox account. (New feature idea – managing check images!)

3. That my service provider will take the utmost care to secure my data

This is generally well understood. Because of laws and the damage that negative publicity around loss of customer data can do, most services try hard to protect it. Try harder! Lately, the hackers seem to be winning.

4. That my service provider will add value to the data

My online brokerage service has always given me a CSV download of my transactions. But till two years ago, they did not have a decent performance analysis of my investment portfolio. So I had to go and put my entire portfolio in a Google spreadsheet which would look up prices from Google Finance and calculate the rate of return. But with reinvested dividends and what not, it took a lot of work to keep the portfolio up-to-date. How you can be an online brokerage and not offer the most basic use of my data – portfolio performance – is beyond me?

Performance analysis, alerts, suggestions – they are all possible. And expected. If my credit card hits me with a foreign transaction fee, I want to know about that in an alert (thank you Mint!).

5. That my service provider will understand that the reward is mostly my loyalty

There was a time, when online retailers did not give you a transaction history. I stopped shopping on those sites. I don’t want to spend the time to search for the same item all over again, if I want to buy another one.

For service providers, this is going to become the cost of doing business. So if you think that you will invest in giving me more value from my data only if I pay you more for this value, your competitors who think differently will get my business.

But, if you are clever about it, you will discover value points that I will pay for. You see, the work that you do to help me get more value from my customer data, in turn helps you understand me better. And when you understand me better, you will be able to design services that I will want to pay for.

Wanted: A Rules Engine for Excel

Excel Error

James Kwak writes about the role of Excel in the JPMorgan 2012 trading loss

After the London Whale trade blew up, the Model Review Group discovered that the model had not been automated and found several other errors. Most spectacularly,

“After subtracting the old rate from the new rate, the spreadsheet divided by their sum instead of their average, as the modeler had intended. This error likely had the effect of muting volatility by a factor of two and of lowering the VaR . . .”

So @SUM instead of @AVG and boom – $2B in trading losses.

I am exaggerating of course. It didn’t quite happen that way, but it does appear that this Excel error made the trade appear much less risky than it actually was. [You'll find a full analysis of the JPMorgan trade here. A lot more interesting is this history of Excel bloopers.]

Excel is the weapon of choice for financial analysts of all hues. You could be an analyst evaluating complex derivative instruments or an investor projecting a public company’s future earnings. If you are a financial analyst, you probably spend a big part of your life looking at a grid of tiny grey cells.

During my startup days, we built a product that would pull in data from our library directly into their spreadsheets and keep it current. Since we worked with our users to design the product we got to see many, many spreadsheets.

As a rule, these spreadsheets are massive, multi-MB beasts. They start big. Over time they gather more and more data and complex analyses and become massive. In their full glory, they are inscrutable to anyone except their owners. And often even that is doubtful.

Not surprisingly, we regularly found errors in the spreadsheets. As expected, data errors were common. But errors in formulas, of the kind above, were not uncommon at all.

Now think about it. Companies are making decisions worth tens, sometimes hundreds of millions on the backs of financial analyses done in Excel spreadsheets, that are understood solely by their owners and are impervious to scrutiny by anybody else.

Excel was never designed to be anything more than a personal productivity tool. If the stakes of getting a risk model right are that high, then shouldn’t that risk model be treated like enterprise software – with development standards, commented code, versioning, unit and integration testing?

It’s not as if enterprise software doesn’t have its share of messes. The CIO of a print publication recently told me that they did not think they knew all the different offers on the publication that were available out on the internet. Apparently, there was a link on some forum that was still allowing a special offer and they didn’t know how to turn it off! We recommended re-engineering the whole application and putting a rules engine in front of it.

Perhaps that’s what financial modeling needs. A rules engine that drives all the analysis below. The problem with Excel is that the formulas and the data are all mushed together into a blob of grey cells. They need to be layered. Data in one place, rules in another. If I want to project a company’s revenues by applying the average year-on-year growth in the last four quarters, that’s written in the rules area. The historical revenues are in the data area. If the gross profit is a fixed percentage of revenue, that too is written in the rules area. When I change the rule, the computation changes and not otherwise. There are no computations that aren’t in the rules.

When I review my model with my team members, we are just looking at the rules, confident that the spreadsheet itself is simply a manifestation of the rules and data. Once in a way, we do look at the data sets as well, just to make sure we are using the right ones and that they are current. And we test the model from time to time to see if it gives out expected results.

But this sounds more and more like a database application. And database applications need programmers. In the real world that we live in, no financial analyst will let a programmer stand between him and his model. But perhaps that is the challenge here. Can we build a rules engine that is enterprise strength, does not require a programmer and sits on top of the WYSIWYG goodness of Excel?

Excel is one of the most powerful applications of our times. It is the killer app in MS Office. It is ubiquitous and everyone who will ever build a financial model already knows how to use Excel. Which is why we do too much with Excel. Which is why we end up betting hundreds of millions on the backs of black box Excel financial models. This needs to change.

The Journey to the Cloud

Oil Cooled Servers – grcooling.com

The beginning of the year is a good time to prognosticate. So here is my prediction – not just for the year, but for the whole decade. This decade in Enterprise IT is going to be mostly about the Journey to the Cloud.

Enterprise IT faces a raft of technology shifts in the coming years. The deep penetration of mobile devices into the enterprise, the impact of social media and the technology to extract intelligence from greater and greater quantities of data, are a few important ones. But what stands out for the disruptive nature of its impact is the Cloud. The Cloud is truly paradigm-shifting for Enterprise IT.

What is so different about the impact of the Cloud? It is not so much about the opportunity of value creation. While the size of the prize is massive, that is true about the other technology shifts as well.

The Cloud is disruptive. It upends the current order of things in Enterprise IT. It shifts control away from IT towards Business. It dramatically changes the role of the CIO and her organization. And it changes the way we manage the business of IT in profound ways – like managing by business outcomes rather than by costs and intermediate IT outcomes.

Why is this so? Since the beginning of Enterprise IT, IT infrastructure, particularly the data center, has always been firmly rooted in IT. Even when outsourced, the outsourcing contract has been managed by the CIO’s organization and they remained accountable for its results. But today, Cloud service providers, run their own infrastructure that is common across all their customers and charge a fee for use. Sometimes they provide infrastructure services only. Often, its more. But always, using Cloud services means transplanting IT infrastructure outside the domain of the IT organization.

IT infrastructure may not directly create value, but business leaders understand the risks involved. Something that could bring your company’s order processing system to a halt is not to be trifled with. So why would an enterprise undertake the risk of such disruption?

Economics, for one. From what we have seen with our clients, the potential for savings range from attractive to downright stunning. But there are other reasons as well – flexibility, developer productivity, time-to-market – and as you get up to the application layer, soon, state-of-the-art functionality will exist only in SaaS applications.

But the biggest reason why the Cloud is unstoppable is because running a data center is not “core” to anybody’s business, except a handful of Cloud service providers. These providers run mega data centers at locations and at a scale where every element of performance and cost is carefully optimized. No company can match that. Enterprise IT will find it difficult to justify “build” over “buy” when it comes to data center infrastructure.

And the future will hold even greater specialization. For example, Intel is running trials with oil-cooled servers (photo above) which need only 2-3 % of their power for cooling (against the usual 50-60%). Today’s data centers are all set up for air-cooling. Can Enterprise IT deal with such shifts in technology?

No, I don’t think so. The Cloud is written in every Enterprise IT organization’s future.

Like most paradigm-shifting technologies, the switch-over may never be complete (I still have a VCR or two at home). But it is inevitable and once it gathers momentum it will be unstoppable.

Cloud adoption will be gradual at first. CIOs will start with new development on IaaS or PaaS. Some will migrate small, non-critical applications to the Cloud. SaaS applications have some momentum. But the bulk of the core enterprise applications still run in the data center. There is a long way to go.

The Journey to the Cloud will be long. There will be risks, and many challenges on the way. There will be existential questions like what is the role of the CIO in this brave, new world. But “there is gold in them thar hills”. It will be worth the ride.

Cross-posted from infosys.com with minor alterations. [link]

What Do You Stand For?

What do I stand for? What do I stand for?
Most nights, I don’t know.

- fun.

Last week’s Economist carried an editorial called True Progressivism. I found myself nodding in agreement as I read through the long editorial. When I finished reading it, I felt like it had perfectly captured what I felt, what I thought, what I believed about government and public policy but would never have been able to articulate this well.

I hope you will go read it. If more people believed in something close to this True Progressivism, it could be a very important path out of the bipolar mess that American politics is today.

I happened to mention how much I liked this piece to a guest at an Infosys event last week. He said that his wife sometimes echoed similar sentiments about Tom Friedman’s writing – that it almost speaks to her. But he tells her that that is because her thinking has been shaped by Friedman’s writing. And now, obviously, what he writes agrees with her viewpoint.

Was it the same way with me and the Economist? Had I read it for so long that it had shaped my own belief system about politics and economic policy and now when I read something like this piece, it seems like it was speaking to me?

Perhaps. But I have read the Wall Street Journal longer, though less nowadays. I read the New York Times a lot more than the Economist. But I don’t always agree with the New York Times editorial page, and rarely with WSJ’s.

No, I don’t think the Economist has brainwashed me. I think that good newspapers are a little bit like friends. Your friends do influence you. But you tend to spend more time with the ones that think like you do. And the way you think is a product of your experiences and the people that have influenced you. And hopefully, rational, independent thinking.

The world is full of tribalism. If your family, friends and the people around you believe in something, you are almost predestined to believe in the same thing. Good writing like the Economist’s and thinking for yourself can save you from this dreary predetermined destiny.

Why is That Ad Following Me Around on the Internet?

Forbes has a piece on Why Wall Street Likes LinkedIn More Than Facebook. The difference in how well the two companies monetize user interest is quite significant.

And when it comes to making money, LinkedIn packs a much harder punch than Facebook. LinkedIn manages to rake in $1.30 per user hour spent on the site, while Facebook scrapes by with a measly 6.2 cents per user hour.

The article’s explanation of this gap is that professional data is more important to enterprises than personal data to consumer advertisers. But I don’t know if it is just about that. Somewhere in there lurks a question begging to be asked? Does Facebook monetize user attention as effectively as it could?

Take me. I use Facebook regularly. Not a whole bunch, but I will check in a couple of times a week, mostly over the weekend. Here are the typical ads that I see.

I can link each ad back to something in my profile. I live in the Bay Area, am liberal, married and male. Is this kind of broad-brush targeting the best Facebook can do?

The ads are uniformly unmotivating. They are shown repeatedly. As if there was a very limited stock of ads to show and they had to show half a dozen on every page. So sorry, but we will subject you to the same insipid ads over and over again.

You might point out that I’m not a typical Facebook user. I share a little but not a whole lot of information. I never use my Facebook login on 3rd party sites. So FB doesn’t have much to work with.

But that wouldn’t be true. FB has a ton of personal data for me – my social graph, my status updates. If it still serves up ads that don’t result in any action, is it a wonder that their monetization is at 6.2 cents per user hour?

In contrast look at Google advertising. Comparing Google search advertising with FB advertising is perhaps not fair. Search clearly declares intent which makes targeting much easier. Display ads will find it tough to compete with that.

But Gmail ads are perhaps as close as it gets contextually, to FB. I find Gmail ads to be very relevant. Google’s algorithms are clearly analyzing my email content to determine which ads to serve up. FB isn’t doing that with status updates.

Users want to see ads that are better targeted. I am interested in seeing relevant ads. And advertisers want to reach interested users. The right economic model (a la AdWords) and some clever computer algorithms should get you there. It can’t be that difficult if you have Facebook’s resources. So I wonder why it’s taking them so long to get this right.

Twitter too is trying hard to get their advertising model right. Promoted tweets in my timeline show up from time to time. They are using the social graph cleverly and I find many of their promoted tweets relevant. I spend a lot more time on Twitter than I do on FB, so I do hope they find a non-intrusive but successful advertising model.

Meanwhile, an ad for a certain watch has been following me around wherever I go on the internet. It so happened that a couple of months ago I clicked on an ad for the watch. I then went and read a whole bunch of reviews and so on and then actually bought the watch. But now, the ad networks think that since I clicked on the watch ad, I am interested in it. So now I am bombarded by the same ad everywhere. All wasted advertising since I’ve already bought the watch. And very annoying.

So now I have done two things. Both of them are detrimental to the ad networks’ and the advertiser’s interests.

One, I opted out of all interest based advertising. They don’t make it very easy for me to do that, but I patiently went to all the websites and opted out.

Two, I will never click on a display ad again. If it interests me, I will google it and get to its website through search.

I am positive that I am not the only person who is doing this. Some may want to but don’t know how or don’t have the patience to. But many will opt out. Soon there’ll be a video on YouTube on “How to Stop That Ad Following You Around on the Internet”. And then the game’s over.

The Trouble With Powerpoint

Wrong tool, right idea

A couple of weeks ago, I was walking someone through a Powerpoint deck on the phone. The discussion was going well. But every now and then she would skip ahead. I’d be on slide 12 expounding some gory detail of our actions in Q1 and she would say “I have a comment to make about XYZ on slide 14″. Just a little unsettling.

So I thought about it. I had sent the deck to her the previous evening. It had a lot of detail – stacks of bullets and in places, full sentences. I wanted her to be able to understand the slide deck by reading it without my voice over. She did exactly that, and then the next day, I subjected her to my voice over anyway. No wonder she was skipping slides.

The number one problem with how Powerpoint is used in companies is that the same deck is used for different purposes. And it doesn’t work. Dual-use powerpoint decks are the single most important reason why the powerpoint slides used in stand-up presentations are so terrible.

IT Services companies are the worst perpetrators of the dual-use crime. We make illustrations with lots of boxes and arrows and inscrutable terms and acronyms. We put them in proposals. Then we take the same illustration and slap it onto a slide. In all its 14 point font glory. During the presentation we will actually turn towards the screen and read the whole thing out. Or sometimes you’ll hear “I won’t take you through all this information, but…”. Well then, why put it on the slide?

Dual-use crimes occur in other ways too. At Infosys, with globally dispersed teams across vastly different time zones, it is very common to exchange powerpoint files with the expectation that the other party will read the powerpoint and understand its contents. A typical email might read “Please find attached a deck that explains XYZ. Let me know if you have any questions.” You open the deck and it’s the same boxes-arrows style of presentation. Sometimes its useful because you already have the background and this is incremental information. At other times, you don’t understand a thing, or even why it was sent to you.

When you want someone to understand a document without a voice over, an email or Word document might work better. Because unlike a few paragraphs of a long email, a Powerpoint slide with boxes and arrows has no narrative thread.

I hand-wrote my transparencies at b-school, at my first job and even for my interview for Infosys in 1994. When Powerpoint was introduced, or rather when I was introduced to it, I thought it was an amazing invention. It completely changed the process of preparing for a presentation. The text on the slides was crisp, clear without having to send the slides to be done by an agency. Editing was so much easier. You could make changes right to the last minute before the presentation. You could draw diagrams and mix them with text easily. Later, we got fancy looking transitions too.

Powerpoint radically changed the overhead presentation. But somewhere along the line, it took over all forms of communication within business. The long form of writing just went away. I don’t know if we are unique at Infosys, but I don’t see much use of MS Word. It is all Powerpoint or Excel.

Dual-use is not the only reason why Powerpoint is overused and misused. The truth is that Powerpoint has become a crutch for the overworked modern-day employee. Its use makes it acceptable to not write full sentences, paragraphs or in fact, have a narrative at all.

As a consultant Powerpoint comes in handy in other ways too. If you aren’t sure about how a client will respond to some parts of the proposal why spell it out in detail. A brief bullet in the deck allows you wiggle room that you use based upon the body language of the client in the meeting.

Consultants also regularly create too many slides and too many words on each slide. This is a universal phenomenon. Why this is so, is not clear to me. It’s as if they are OK with any outcome in the meeting including the client passing out from sheer boredom. But god forbid, they should ever be accused of not working their butts off on the presentation.

Engineers are of course far worse at this than consultants. Most of us receive an education that equips us to solve problems, not communicate the solution to someone else. The engineering school I went to put a high premium on getting the funda (fundamental principle). Explaining how you figured it out was just wasn’t our thing.

Then we join a company where we see consultants flinging out decks with 50 fancy box-and-arrow slides. And we say, we can do that too. Thereafter all slides have boxes, arrows and 14 point text. And of course, tons of jargon and acronyms, because we engineers love them. It makes us look smart. All our formative years have been spent yearning for those small shots of dopamine to the pleasure center of the brain, when I get something that you don’t. Or when I say something that forces the listener to ask, “What does that mean?”. Now suddenly, you’re asking me to communicate simply. That just fries my circuits.

And of course it is also well known that most engineers are color blind. So our 50 box-and-arrow slides in 14 point text display all colors of the rainbow. The final product can be quite awesome to behold. Something that can kill a domestic pet at 20 paces. Clients are advised to wear protective eyewear.

In Indian IT Services companies I believe this is now a crisis. Not just the use of Powerpoint but all of business communication. And with the SMS generation now getting into mainstream business communication, the future doesn’t look too gr8 either.