MBA Think: A Well Calibrated Ethical Compass

December 3, 2018

I read “Goldman Sachs Asks in Biotech Research Report: ‘Is Curing Patients a Sustainable Business Model?’” For a moment I thought I was on the debate team in college preparing for one of those inevitable tournaments. As part of the prep, my partner — an engaging fellow and slick talked named Nick – would meet with those also involved in the competition from my one mule college in the middle of a corn field. Great ideas were exchanged, and some of them were definitely worthy of 18 year old minds fueled with pizza, ego, confidence, and arrogance. Delightful, right?

The article triggering this moment of nostalgia reveals how the somewhat callow mind navigates possibilities in our modern world. The write up states:

“Is curing patients a sustainable business model?” analysts ask in an April 10 report entitled “The Genome Revolution.”

Like many fuzzy questions, one can make a case that there is a lot of money to be made letting a person live from drug treatment to drug treatment. Thus, prolonging life enriches the pharmaceutical firms making the life extending drug, the insurance companies (fine outfits all!), the conglomeratized health care institutions, and assorted health care hangers on and fellow travelers.

On the other hand, letting people die cuts costs. Not good unless one is betting against an individual’s survival. Las Vegas, are you listening? Perhaps Facebook will enter the health care sector. Google continues to innovate despite its failure in the eye wear and glucose monitoring sectors. But Google has not made much progress solving death. Bummer.

I suppose one could ask IBM Watson, which also has a core competence in curing cancer.

How is your ethical compass calibrated? One hopes in a way congruent with exemplars of the American way.

Stephen E Arnold, December 3, 2018

Palantir Technologies: Keeping Momentum, Job One

November 29, 2018

Hop in your time machine and think back about five years. While it feels like the olden days of horse-drawn carriages already, it was a golden age for big data analytics startups. Tops on that list for many was Palantir. Thought, today things are much different, as we discovered in a recent Cheddar video, “Why Palantir’s Valuation is Withering Away.”

According to the article:

“Not long ago Palantir Technologies was valued at $20 billion and one of Silicon Valley’s brightest tech companies. Today, the big data analytics company’s worth has been slashed to $6 billion by Morgan Stanley as it heads towards an IPO.”

Perhaps part of the lag draws from Palantir’s secrecy, considering it works for organizations like the CIA and others.

However, stakeholders and employees still have big dreams like many other Silicon Valley shop: They want to go public.

A drop in valuation and concern over whether they can ever turn a profit is starting to seriously tarnish this once golden child of the tech industry.

Beyond Search does not want to draw parallels with Autonomy or other search centric firms. Some of these outfits found that the momentum of selling sizzle was difficult to maintain in a room with open windows.

Worth watching how this financial drama plays out as Amazon gears up to become the go to provider of policeware and possibly business intelligence services.

Patrick Roland, November 29, 2018

Who Is a Low Risk Hire?

November 21, 2018

Last week, a person who did some contract work for me a year ago asked me if I would provide a reference. I agreed. I assumed that a caring, thoughtful human resources professional would speak with me on the telephone. Wrong. I received a text message asking me if I would complete questions. Get this. Each text message would contain a question about the person who sought a reference. After I hit, send, I would receive another text message.

Wrong.

I was then sent a link to an online form that assured me my information was confidential. “Https” was not part of this outfit’s game plan. I worked through a form, providing scores from one to seven about the person. The fact that I hired this person to perform a specific job for me was evidence that the individual could be trusted. I am not making chopped liver or cranking out greeting cards. We produce training information for law enforcement and intelligence professionals.

I worked through the questions which struck me as worrying more about appearing to be interested in the individual than actually obtaining concrete information about the person. Here’s an example of what the online test reveals:

image

Yeah, pretty much useless. I am not sure what “adaptability” means. I tell contractors what I want. The successful contractor does that task and gets paid. A contractor who does not gets cut out of the pool. This means in politically incorrect speak: Gets fired.

I read “Public Attitudes Toward Computer Algorithms” a couple of days after going through this odd ball way to get information about a person working on law enforcement and intelligence related work. The write up makes clear that other people are not keen on the use of opaque methods to figure out if a person can do good work and be trusted.

Well, gentle reader, get used to this.

Human resources want to cover their precious mortgage, make a car payment, or buy a new gizmo at the Amazon online store. The HR professionals are not eager to be responsible for screening individuals and figuring out what questions to ask a person like me. For good reason, I am not sure I would spend more than two minutes on the phone with an actual HR person. For the last 30 years, I have worked as an independent consultant. My only interactions with HR are limited to my suggesting that the individual stay away from me. Fill out forms or something. Just leave me alone, or you will be talking to individuals whom I pay to make you go away. I have a Mensa paralegal who can tie almost anyone in knots.

Several observations:

  1. Algorithms for hiring are a big, big thing. Why? Tail covering and document trails that say, “See, I did everything I could required by applicable regulations.” Forget judgment.
  2. The online angle is cheaper than having an actual old fashioned HR department. Outsource benefit reduction. Outsource candidate screening. Heck, outsource the outsourcing.
  3. No one wants to be responsible— for anything. Look at the high school science club management methods at Facebook. The founder is at war. Former employees explain that no one gave direction. Yada yada.
  4. The use of algorithms presumably leads to efficiencies; that is, lower costs, better, faster, cheaper, MBA and bean counter fits of joy.

Just as Apple’s Tim Cook sees nothing objectionable about taking Google’s money as Apple talks up its privacy / security commitment, algorithms make everything — including HR — much better.

Net net: I am glad I am old and officially cranking along at 75, not a hapless 22 year old trying to get a job and do a good job at a zippy de doo dah company.

Stephen E Arnold, November 21, 2018

Online Ad Fraud! Who Knew?

October 24, 2018

I read “Apps Installed On Millions Of Android Phones Tracked User Behavior To Execute A Multimillion-Dollar Ad Fraud Scheme.” Goodness, first my faith in Facebook’s data about video ad performance was eroded a tiny bit. Now there are allegations about Android app ad fraud. The write up uses the word “cabal.”

The online advertising business, in my opinion, has been a bastion of integrity. Sure, there were baseless assertions about robot clickers which depleted a competitor’s online ad checkbook. There were squishy numbers about the number of human eyeballs versus crawler clicks. And there were ads for interesting products and services which online ad vendors suggested were real, true blue commercial messages.

Yes, integrity. Online advertising. Bound at the hip.

But there is this write up in Buzzfeed which states:

But an investigation by BuzzFeed News reveals that these seemingly separate apps and companies are today part of a massive, sophisticated digital advertising fraud scheme involving more than 125 Android apps and websites connected to a network of front and shell companies in Cyprus, Malta, British Virgin Islands, Croatia, Bulgaria, and elsewhere. More than a dozen of the affected apps are targeted at kids or teens, and a person involved in the scheme estimates it has stolen hundreds of millions of dollars from brands whose ads were shown to bots instead of actual humans.

I know that it takes smart filters to verify apps in crime free locations like Cyprus, Malta, and Bulgaria. And the British Virgin Islands? Unthinkable.

But the article presents some data which suggest that a modest amount of money is in play; to wit:

App metrics firm AppsFlyer estimated that between $700 million and $800 million was stolen from mobile apps alone in the first quarter of this year, a 30% increase over the previous year. Pixalate’s latest analysis of in-app fraud found that 23% of all ad impressions in mobile apps are in some way fraudulent. Overall, Juniper Research estimates $19 billion will be stolen this year by digital ad fraudsters, but others believe the actual figure could be three times that.

Google, of course, was quick to take action. Google cares.

I am disappointed that this infinitesimal aberrations in an integrity filled business have been reported as “true” fact.

More data are needed, please. I know that Facebook and Google can explain this misguided assertion.

My goodness, manipulation of online advertising. Shocking. Shocking.

Stephen E Arnold, October 24, 2018

IBM: Watson, What Happened?

October 18, 2018

I read “IBM Surprises Investors with Quarterly Revenue Decline.” The write up states:

The company broke its three-quarter string of revenue growth with a 2 percent drop in total revenue to $18.76 billion, down from $19.15 billion a year ago.

The article pointed out:

Most notably, Cognitive Solutions revenues fell 5 percent, to $4.15 billion, against analyst estimates of $4.3 billion. That division, which includes IBM’s analytics business as well as the Watson cognitive computing platform, was pulled down by weakness in some horizontal categories such as collaboration, commerce and talent management.

Watson, what happened?

But IBM pointed out that it is starting to see “green shoots.” I think this means that growth is evident in some sectors.

IBM is a consulting company which still sells mainframes. Enough said.

Stephen E Arnold, October 18, 2018

Omnity Search: Adjusting Fast and Slow

October 14, 2018

Beyond Search maintains a file about the Omnity search system. We noted that a new white paper became available in April 2018. If you want a copy of the 42 page document, you can download a free copy at this url.

The white paper is interesting because it suggests that the current methods of finding information are “inherently biased.” Omnity’s indexing is different; for example:

Omnity has developed a semantic signature technology that impartially and mathematically articulates the deep structure of a document, and self-assembles by inter-connecting to other documents with similar structure.

Omnity may be the first search and retrieval syst4em to embrace blockchain technology, but we are not 100 percent certain. Frankly we don’t pay much attention to distributed databases because the technology is another spin down database lane and the next big thing mall.

The document contains some interesting diagrams. Some of these remind us of sense making systems for law enforcement and intelligence professionals. The company positions itself against Palantir and Quid as well as Bloomberg and Lexis Nexis. Surprisingly Linguamatics is a “leader” like Omnity.

What is fascinating is that Omnity seems to be embracing the digital currency approach to raising funds. One of the firm’s advisors is the really famous Danny Kahneman.

My recollection is that Omnity was going to knock Google search off its mountain top. Then Omnity shifted to a commercial model like the old Dialog Information Services. Now it is blending findability with blockchain and crypto currency.

More information about the company is at www.omnity.io. Get the white papers. Check out the diagrams. One question is, “Should Palantir and Quid be looking over their individual and quite broad shoulders?”

Omnity’s approach is a good example of search vendors repositioning fast and slow.

Stephen E Arnold, October 15, 2018

COBOL Cowboys. Where Are the Cowgirls? Where Is the Trail Boss?

October 4, 2018

I love ThomsonReuters. Every once in a while, its real journalists craft a gem. I submit that “Banks Scramble to Fix Old Systems as IT Cowboys Ride into Sunset.” I will not point out that eliminating the “the” before “sunset” is a quite trendy touch.

The point of the write up is that when a bank hires an individual to work on systems, that engineer may love python, tolerate C, and maybe invite Java in for coffee once a month or so.

The write up reports that a banker allegedly said:

It [dealing with COBOL based systems] is immensely complex which sells new IT infrastructure to banks. “Legacy systems from different generations are layered and often heavily intertwined.

No kidding. Who knew? I recall the Year 2000 hysteria which sparked a bit of interest in COBOL. My memory may be fading. Perhaps that money gusher for COBOL professionals was an illusion.

A couple of observations:

First, COBOL has been around for 60 years. Innovations and alternatives have been around for decades. The failure of major institutions to invest in infrastructure is one reason why Amazon could provide a solution. There’s more money in banking than there is in selling eBooks, by the way.

Second, the notion of programmers as cowboys strikes me as odd when the #MeToo movement and its assorted fireworks are in evidence. A modest nod to non male COBOL wizards seems to be an odd omission. I saw the word cowboys and I wondered if the folks running this outfit should be asked to create a more appropriate name; for example, Gender Neutral COBOL Remediation or GNCR. I like it. Perhaps a Twitter storm will erupt.

Third, years ago I assumed Boards of Directors were supposed to provide inputs and help senior management figure out what to do with computers, software, and other business decisions. Have the Boards of Directors remained unaware of technological advances for more than half a century? That’s a question to which the answer seems to be, “Yes.” I am assuming that the TR write up is on the money.

Finally, what’s up with bank regulatory entities? It seems to me that somewhere along the regulatory chain the question, “What should be the minimum for bank technology enhancements?” I wonder if IBM has played a small role in keeping those mainframes humming? No, IBM would not make it difficult (technically or financially) to get free from the mainframe grasp. I assume I could ask Watson, but maybe not.

To sum up, ThomsonReuters’ article is a gem. I wonder if ThomsonReuters is running obsolete computer and network infrastructure hardware? Are these some DEC 20s lurking in Boston? Are banks able to search their documents in a reliable, satisfactory way? Why have the trail bosses lost the cattle?

Yikes, too many questions.

Stephen E Arnold, October 4, 2018

Financial Tremors?

September 12, 2018

The folks with crypto currency may be having a bit of a thrill. The volatility suggests that bits and bytes may not be as stable as owning a chunk of real estate in Tokyo.

We have also noted rumblings elsewhere. Smart software, for example. Many hopes, of course, but there may be some downstream consequences. Salmon finding life difficult may be one metaphor.

It has become a weekly, maybe even daily, routine: some alarmist talks about the dangers of AI on a particular industry, we get scared, the news cycle moves on, and everyone forgets. However, a warning is lurking that has the potential to have some staying power. We learned more from a recent Technology Review story, “The World Economic Forum Warns That AI Might Destabilize The Financial System.”

We learned:

[A]rtificial intelligence will disrupt the industry by allowing early adopters to outmaneuver competitors. It also suggests that the technology will create more convenient products for consumers, such as sophisticated tools for managing personal finances and investments.

We also noted:

But most notably, the report points to the potential for big financial institutions to build machine-learning-based services that live in the cloud and are accessed by other institutions.

This is a very volatile situation, especially as so much finance is starting to hinge on machine learning. For example, many retirement plans are shifting funds around based on AI insights. But take hope for what it is. Quantum computing may be just around the corner.

Patrick Roland, September 13, 2018

IBM Embraces Blockchain for Banking: Is Amazon in the Game Too?

September 9, 2018

IBM recently announced the creation of LedgerConnect, a Blockchain powered banking service. This is an interesting move for a company that previously seemed to waver on whether it wanted to associate with this technology most famous for its links to cryptocurrency. However, the pairing actually makes sense, as we discovered in a recent IT Pro Portal story, “IBM Reveals Support Blockchain App Store.”

According to an IBM official:

“On LedgerConnect financial institutions will be able to access services in areas such as, but not limited to, know your customer processes, sanctions screening, collateral management, derivatives post-trade processing and reconciliation and market data. By hosting these services on a single, enterprise-grade network, organizations can focus on business objectives rather than application development, enabling them to realize operational efficiencies and cost savings across asset classes.”

This, in addition, to recent news that some of the biggest banks on the planet are already using Blockchain for a variety of needs. This includes the story that the Agricultural Bank of China has started issuing large loans using the technology. In fact, out of the 26 publicly owned banks in China, nearly half are using Blockchain. IBM looks pretty conservative when you think of it like that, which is just where IBM likes to be.

Amazon supporst Ethereum, HyperLedger, and a host of other financial functions. For how long? Years.

Patrick Roland, September 9, 2018

Wake Up Time: IBM Watson and Real Journalists

August 11, 2018

I read “IBM Has a Watson Dilemma.” I am not sure the word “dilemma” embraces the mindless hyperbole about Vivisimo, home brew code, and open source search technology. The WSJ ran the Watson ads which presented this Lego collection of code parts one with a happy face. You can check out the Watson Dilemma in your dead tree edition of the WSJ on page B1 or pay for online access to the story at www.wsj.com.

The needle point of the story is that IBM Watson’s push to cure cancer ran into the mushy wall composed of cancerous cells. In short, the system did not deliver. In fact, the system created some exciting moments for those trying to handcraft rules to make Dr. Watson work like the TV show and its post production procedures. Why not put patients in jeopardy? That sounds like a great idea. Put experts in a room, write rules, gather training data, and keep it update. No problem, or so the received wisdom chants.

The WSJ reports in a “real” news way:

…Watson’s recommendations can be wrong.

Yep, hitting 85 percent accuracy may be wide of the mark for some cognitive applications.

From a practical standpoint, numerical recipes can perform some tasks to spin money. Google ads work this magic without too much human fiddling. (No, I won’t say how much is “too much.”)

But IBM believed librarians, uninformed consultants who get their expertise via a Gerson Lehrman phone session, and from search engine optimization wizards. IBM management did not look at what search centric systems can deliver in terms of revenue.

Over the last 10 years, I have pointed out case examples of spectacular search flops. Yet somehow IBM was going to be different.

Sorry, search is more difficult to convert to sustainable revenues than many people believe. I wonder if those firms which have pumped significant dollars into the next best things in information access look at the Watson case and ask themselves, “Do you think we will get our money back?”

My hunch is that the answer is, “No.”

For me, I will stick to humanoid doctors. Asking Watson for advice is not something I want to do.

But if you have cancer, why not give IBM Watson a whirl. Let me know how that works out.

Stephen E Arnold, August 11, 2018

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