Sunday 31 October 2010

Clausewitz, Sun-Tzu and…

It has recently been published in the press that Germany has just finished paying World War I reparations.

In 1919, the Treaty of Versailles, which ended that war, left Germany into actual bankruptcy, its mainland violently severed, virtually no Armed Forces, no colonies, no heavy industry. About 20 years later, Germany was able to defeat France, the greatest of the victors, in just four weeks, turning continental France is basically a virtual colony for Germany until it was liberated by Anglo-American forces in 1944.

In May 1940, France had the mightiest Army in the world. It was apparently safe behind the Maginot Line (a masterpiece of military technology of the time) set along the border with Germany, from Switzerland to Belgium. Still, the German Flag was unfurled on top of the Eiffel Tower before the end of the month, and stayed there for four long years.

What had happened in a devastated and ruined Germany that made it possible for she to dominate Europe from France to Poland, from the Mediterranean coast to Cape North in Norway?

First: Overall general feeling of having been unfairly treated. That was a common feeling in the German peoples after World War I, who felt betrayed.

Second: A determinant change of leadership with a clear plan to be strictly followed in the years to come. In 1933, Adolf Hitler became Reichskanzler, and in 1934, after the death of General Hindenburg, he became Head of State too.

Third: Focus on niche strengths. Since 1933, Germany’s industrial and economic potential was fully concentrated in rearming the nation towards the ultimate objective of conquering Europe: Ultramodern and powerful tanks, vessels and, especially aircraft. Germany reached levels of product excellence almost unknown to the rest of the world.

Fourth: Selective cooperation from former enemy powers. Since 1933, Western World financers and Soviet military were swiftly used by Germany to structure its preparations for war in the coming years.

Fifth: A carefully planned set of small degree conquests, annexations and political alliances with two targets: To position Germany strategically in the best way to develop its war plans and to add technological and industrial capacity to support future war. The Rhineland, Austria, the Czech republic were invaded and integrated into Germany’s Empire; Balkans and Italy were political allies. Even the Soviet Union initially cooperated with Germany when Poland was invaded.

Sixth: An overall passiveness and appeasement policy played by the old victorious powers of World War I, who basically left the filed unopposed to Germany.

Seventh: A revolutionary set of tactics that changed the military rules of warfare as it was known until then. It was the Blitzkrieg, the super-innovative way of fighting war, based in cooperation between tanks and aviation to be followed by traditional infantry.

Eighth: Surprise effect. Germany always attacked in the most unimaginable place and time, following careful plans that had been designed from scratch specifically for the situation of the moment.

Ninth: Complete autonomy and freedom to act to leading generals and strategists. Many of them are well known in the military circles for their military achievements.

Tenth: Absolute faith in themselves, in their ability to execute their plans, and absolute convincement of what they were doing.

We have recently read about what has been described as The Greatest Comeback Story of all Time, and we are amazed.

First:The dramatic situation of Apple in the 1990s generated the feeling of unfair treatment in the current and former employees of Apple, including Steve Jobs himself.

Second: In 1997, after several years of exile outside of Apple, Steve Jobs was elected interim CEO of Apple, just a few years from being elected absolute CEO (2000). He, too, had a precise plan to be executed systematically in the years to come.

Third: Focus on niche strengths, such as Mac OS, iTunes, iPod. Apple led in those product segments, almost unknown to the rest of the world.

Fourth: Selective cooperation from former enemy powers. The cooperation from rival Microsoft was determinant to support Apples recovery in the late 1990s. Both from a financial and infrastructural perspective.

Fifth: A careful planned set of apparently smaller degree conquests: NeXT, Pixar are just the best known of a series of many, which, apparently look somewhat innocent, but have been strengthening Apple once and again.

Sixth: Dominant brands in all the market segments Apple has stepped into have underestimated them. In PCs, in Operating Systems, in music player devices, as well disregarded have been Apple’s inventions or creations, like iTunes, who now everybody tries to copy, as they have set market models and standards.

Seventh: Apple’s own blitzkrieg, developed through tools like iTunes or AppStores, have revolutionized the market rules, and were based in cooperation of all the aspects of product life cycle, from product specifications to packaging, delivery and support.

Eighth: Surprise effect. Apple strikes when and where they want, turn the market upside down, and maximize results during all the time it takes for competition to catch up.

Ninth: All management levels were given autonomy for operational decisions on the spot. Similar to Sun-Tzu’s third maxim, if you want, “the commander in the field is not always bound to his sovereign’s orders”. 

Tenth: Absolute faith in themselves, in their ability to execute their plans, and absolute convincement about what they were doing. No wonder Steve Jobs detractors even say from him that he lives in a reality distortion field

The German War Flag stood in the heart of Paris for four years. Apple’s Flag is in the heart of Paris too… and will stay for longer, we believe. Apple Store at Opéra, Paris.

Sun Tzu and Carl von Clausewitz are known for having been military theoreticians and strategists whose works, still in print, have influenced many world leaders in politics, philosophy, history and ultimately business and economics. Their texts are thoroughly read, studied and ultimately learnt in all business schools around the world.

We think the third philosopher, the third strategist, the third theoretician, whose job and works match the level of the formers, is, precisely, Jobs.

 

Footnote: This post is dedicated to one of our best friends, who patiently enough cared to take us to our first visit to the Eiffel Tower, and showed us how beautiful Paris can be, and not only in springtime, as the song said… 

 

Saturday 30 October 2010

Mark Hurd’s blank cheque

 

We have already written about the fondness that the Pontifex Maximus at the oracle has of Chinese philosopher Sun-Tzu and his works “The Art of War”.

There is a wonderful episode describing the three maxims Sun applied for the new style of war at that time, almost 3,000 years ago.

Sun was looking for a job from the King of Wu, Ho-Lu, who requested Sun to demo his theories… using women for a change.

180 concubines were ordered into the room where the King and Sun were. Sun divided them in two groups, appointed the King’s two favorites as officers and explained all that about “left face”, “right face”, and so forth. He barked an order, and… nothing happened.

Calmly turning back to the sovereign, who was probably amused with the show, Sun said: “If instructions are not clear, it is the commander who is at fault”.

Sun explained the stuff all over again. And barked his orders for the second time. Once more, nothing happened.

Calmly turning back to the sovereign, who was starting to get a bit puzzled about what was going on, Sun sated: “If orders are clear, but not carried out, it is the officers fault.” And he ordered the concubine-officers’ heads off.

Then the King started protesting, to what Sun gave his third maxim: “A commander in the field is not always bound by his sovereign’s orders”. And the heads were effectively off.

Sun appointed then new officers, and this time the concubines formations worked like a Swiss watch.

Sun got the job…If we recall the last job given by the Pontifex Maximus at the oracle, Mark Hurd has probably got a sort of blank cheque. After all, he already proved at HP he knew how to tame flocks, herds or crowds, did he not?

Incidentally, for those who recall the oracle’s hardware proposition, we think that “Tzu” does not mean “Microsystems” in Chinese.

Running on quicksand

 

Probably not used to getting a “no” as an answer, The Pontifex Maximus as the oracle must be feeling a little frustrated this weekend. No delay in the trial, as much as no gag order.

Symbolic victory, this denial of silence requested by SAP lawyers indeed, as the Pontifex has already circulated all the baffling he has been able to devise. Still a victory, however, and it’s likely he will try to maximize this. We think we will still hear from him.

Phyllis Hamilton, the judge in charge of this affair, has been very clear. Denying both requests, gag order from SAP and trial delay from the oracle, is just stating that in the courtroom, she is the boss, and she will not tolerate any interference with procedures and formalities. Despite the way any of the parties want to see the case, facts just show that this case is several years old, and all the buzz around Mark Hurd being dismissed by HP and afterwards being hired by the oracle, and the noise about Léo Apotheker being appointed new CEO at HP has nothing to do with the real dispute between the Oracle and the German SAP AG. And this is particularly true given the latter already admitted guilt about improper behavior, and accepted paying compensation to the former.

As a matter of fact, the trial is not about guilt or innocence, but more on determining the real reach of the damage made to the oracle, despite the efforts of the Pontifex Maximus to tweak the case and turn it into a personal evaluation of Léo Apotheker.

SAP has nothing to lose, but a one timer hit in their financials that they probably have already accrued for. And the oracle’s frustration comes mainly from not having the opportunity to get side-benefit from discrediting people at management positions in their business rivals. which is not the best way to reinforce the so much leading position the oracle is looking for in the enterprise business world.

So still tied they are we believe. Oracle 2 – SAP 2 as of now, in our opinion.

Good start for Justice.

And while Justice determines the outcome of this trial, still there could be a winner out of this tie. No Oracle, no SAP, but HP, who will manage to remain out of this story, and eventually might get some reinforcement in what could be a somewhat natural alliance with SAP. Ironically, this could ultimately depend on the oracle, as the reinforcement would be directly proportional to the level of aggressiveness and hostility in the oracle’s approach to the case.

Get the money and silently run, Pontifex. Every time you open that big mouth of yours you put the dollars at risk, and you push one more inch closer SAP and HP. Beating SAP is more about customers, revenue, added value and superior products. Your mouth delivers words, not dollars. Winning the America’s Cup with the fastest boat does not mean you can win a race on quicksand.

Friday 29 October 2010

You can’t hurry love

 

Michael Dell belongs to a generation where many admirers of Phil Collins come from. So probably he will recall Phil’s remake of a classic theme first sung by The Supremes, You can’t hurry love”.

Indeed he should have taken this into account when launching his new advertising campaign, following the announcement of spending a lot of money in revamping their products.

judge by yourself…

We are not going to judge the little sample we have seen, but we certainly applaud Dell’s effort to look at themselves through the eyes of consumers. In fact, the sort of product they are putting there is more likely to be accepted in the market via the consumer segment. Following this communication approach, it looks clear they are following the steps from the master, Steve Jobs at Apple.

Now, we hope these guys realize it is not just a matter of doing nice ads. It takes more than a 30 seconds clip to win customers hearts. “Love don’t come easy”, the song said. “It’s a game of give and take”, and for the moment, Dell’s perception in the consumer market has been much more of a take than a give.

You’ll just have to wait”, and in the meantime, make sure your message goes through, and is backed by superior customer experience and even better service and support. and these has not been your best.

So take it easy, and don’t give up. Otherwise, you will not be having “Another day in Paradise”…

timeless classic…

 

Play wise, play fast

Some time ago we suggested Léo to speed up in one of his most powerful, though still would-be, weapons.

Every day counts. The barrier the oracle was planning to put in front of Herr Apotheker with the upcoming trial on the TomorrowNow affair has been smartly, elegantly and swiftly overcome by SAP’s lawyers.

It looks that Léo left good friends at SAP… what, indirectly, can have a hidden meaning: Nothing less that a tighter liaison in the coming future between HP and SAP.

The Acid Edge already anticipated this possible move, when talking about “Stepping Ahead, Please” (did you notice the initials S-A-P at that time?).

We still think both actions should develop fast and sound: Hurrying with WebOS in one front, and engaging closer to SAP to counter the Oracle’s hostility. And we start to find some similar views around.

Math and numbers, however, set the odds against HP, at least in what relates to storage, which could be the third move. 3Par and Palm acquisitions do not seem to be profitable in any near future.

But more than the mere cold numbers, it is more about confidence what HP should deal with. The ultimate value of the company will rely more on the confidence and expectations it creates than the actual math in a given point in time.

If HP demonstrates strength quickly enough, shares will come up sooner than later:

First: By speeding up smartphones and tablets. That’s a matter of WebOS. The company is showing boldness there by hiring external proven expertise and reorganizing its Palm Division.

Second: By speeding up integration of 3Par and quickly delivering results. More than actual profitability, it needs to show solid trends.

Third: By closing ranks with SAP. A solid covenant to stand against the oracle. Depends much on SAP, but the two could make a formidable rival to the oracle, despite not having nice Armani suits nor having won America Cup.

Fourth: Playing the Russian military tactics…

You could have some aces in your sleeve, HP. Play wise, but play fast.

 

Oracle 1 – SAP 1

 

About 200 years ago, Napoleon Bonaparte invaded Russia in his attempt of world domination. A mighty army, La Grande Armée, the flagship of the French Grandeur, marched in.

Russians soldiers were no match. Should they have stood to the French, they would have been severely defeated, and Napoleon would have returned victoriously.

So the Russian commanders, in a brilliant move, applied the best strategy they could think of. Taking advantage of the huge and vast territory behind them, they retreated systematically, leaving unopposed fields and land to the French, but making sure first their foe would not find anything (supplies, food, shelter…) that could be of any use.

All the way to Moscow, Russia was devastated before the French advances. Even Moscow itself was set on fire.

Winter arrived, and the comfortable time they planned to spend in Moscow turned into the coldest and hardest winter ever.

Out of supplies that should have been obtained on their victorious march to the capital city, weather conditions and unpreparedness of the Grande Armée made the rest. Very few of those invincible soldiers made it back to France. Very, very few. Hardly 58,000 men out of 700,000.

Germany made a similar mistake in 1941.

The oracle’s well known for his admiration of Sun Tzu’s (The Art of War). But he might want to add some History to his strategy masterbook, and instead of going 3,000 years back in time, read something about Russian History in the last 200 years.

Like Napoleon in 1812, he is preparing himself to attack the Russian SAP, and while making the most of that (up to $2 bn, nothing less), collaterally damage other enemies, namely HP. And, like Napoleon, he’s being caught in the same no-show reply from his enemy.

SAP seems to have sized up the situation, and given they already admitted guilt in the TomorrowNow affair, they are not willing to be plundered and participate in the party that the oracle is trying to set up: “No, thank you!”, they have replied. And they (SAP) plan to shorten the trial as much as they can’t, by arguing there is no point beyond sizing up the amount they might have to pay the oracle.

The oracle has erupted in rage: As important for them as the money SAP would have to pay the oracle, the actual harassment to Léo Apotheker as former SAP CEO as much as incoming HP CEO was important to Big Mouth Larry. Big Mouth’s reaction proves it.

Sorry, kid. Despite historical examples that could not possibly appear in Sun Tzu’s, at the moment SAP’s given you the finger. No party, no fun. You are just going to get dollars, an nothing else. No party, no fun, no sacrificial victim to offer to your hordes of admirers.

The Oracle: 1 – SAP: 1

Thursday 28 October 2010

A tribute to the oracle (II)

 

Well, a reader/friend suggested additional music to add to the oracle’s playlist...

Yachts, fancy parties, illegal liaisons, private jets… and underworld spies. About perfect!

not that Carly either, kid…

just in case, here you got the lyrics…

You walked into the party like you were walking onto a yacht
Your hat strategically dipped below one eye
Your scarf it was apricot
You had one eye in the mirror as you watched yourself gavotte
And all the girls dreamed that they'd be your partner
They'd be your partner, and...
You're so vain, you probably think this song is about you
You're so vain, I'll bet you think this song is about you
Don't you? don't you?
You had me several years ago when I was still quite naive
Well you said that we made such a pretty pair
And that you would never leave
But you gave away the things you loved and one of them was me
I had some dreams, they were clouds in my coffee
Clouds in my coffee, and...
You're so vain, you probably think this song is about you
You're so vain, I'll bet you think this song is about you
Don't you? don't you? don't you?
I had some dreams they were clouds in my coffee
Clouds in my coffee, and...
You're so vain, you probably think this song is about you
You're so vain, I'll bet you think this song is about you
Don't you? don't you?
Well I hear you went up to Saratoga and your horse naturally won
Then you flew your Lear Jet up to Nova Scotia
To see the total eclipse of the sun
Well you're where you should be all the time
And when you're not you're with
Some underworld spy or the wife of a close friend
Wife of a close friend, and...
You're so vain, you probably think this song is about you
You're so vain, I'll bet you think this song is about you
Don't you? don't you? don't you?

A tribute to the oracle

 

Well, yesterday we recommended a little relax to the oracle. Though he is known for being a serious fan of Sun Tzu’s, maybe he is precisely falling into one of his traps. The Chinese philosopher advises to make you enemy more choleric if he is choleric in a given point in time, as this will lead him to irrational behavior, and will drive him to more mistakes. So, Big Mouth Larry, cool off a bit, won’t you?

All this story about theft and espionage, however, reminds us of the classic James Bond movies, doesn’t it? Super-villains to hate, super-heroes to love… Music sometimes helps relaxation.

So here we offer you, Big Mouth, a little musical suggestion that might suit you (sorry for the word, but with all these suing around, we couldn’t help it).

Not the same Carly you’d hate, is she? And tell your tennis colleague she’s not fishy, would you?

 

For those who want a transcript of the lyrics, there you go…

Nobody does it better
Makes me feel sad for the rest
Nobody does it half as good as you
Baby you're the best.
I wasn't lookin'
But somehow you found me
I tried to hide from your love light
But like heaven above me
The spy who loved me
Is keepin' all me secrets safe to night
And nobody does it better
Though sometimes I wish someone could
Nobody does it quite the way you do
Why'd you have to be so good.
The way that you hold me
Whenever you hold me
There's some kind of magic inside you
That keeps me from runnin'
But just keep it comin'
How'd you learn to do the things you do
And nobody does it better
Makes me feel sad for the rest
Nobody does it half as good as you
Baby
baby
darlin' you're the best
Baby you're the best
baby you're the best

Wednesday 27 October 2010

Reading or playing at the oracle

 

Quick appendix to our previous post

Apparently Léo Apotheker, by the way, is going to be traveling around the world meeting customers and HP teams as a good start for his new position at HP.

A secondary objective might probably be irritating the oracle (yukyuk).

So here is our little contribution to cool the oracle down a bit. Maybe he should relax a bit reading, playing games other than tennis, or both things!

Soooo obvious, that we’d better apologize in advance.

Note: Sorry kid, but this one’s Nintendo… no oracle software there… (hihihihihihihihihi)

Armani-labeled suits…

 

So here we go…Today the news is reproducing almost everywhere an email submitted by the oracle regarding the case of TomorrowNow’s, scheduled for the first day in November. There are even quite funny references to that (not saying the content is not serious).

But as we go through these references, we miss a certain link that explains why the outbursts from the oracle are coming these days, before the trial actually starts.

After all the mess about certain article published in NYT, a few days ago SAP formally asked for a gag order against the oracle.

And we think that this is probably one of the reasons why the oracle has actually exploded and certainly has done it before the trial started.

Should the gag order come effective, all the information and media influence about it would remain within the courtroom. So in certain way, this email from Big Mouth Larry is one more attempt to influence jurors before he must shut up publicly. it would be consistent with his style, as we recall his declarations about Mark Hurd’s ousting, and many other examples of his particular verbosity.

And trying to understand what he means in this email, we wonder what the need or purpose of sending it is .

First: He is not addressing that much the case itself, but more the fact of Léo Apotheker, former SAP CEO and currently HP CEO, attending the trial should he be called or not. His main point is this one. It is Léo Apotheker’s presence. The German exec is just one more witness in a longer list. SAP, the offender company, is hardly mentioned but incidentally, as the previous employer of Léo Apotheker.

Second: If he does have evidence about any wrongdoing by Léo Apotheker, then he indeed has a won case, and naturally Justice will grant him his demands. But it is up to the jurors to decide the verdict, not general public, and certainly not journalists. The case will be settled in a courtroom, not in parallel trials online.

Third: He boldly dares to guess HP’s plans of keeping Léo Apotheker away from the US in order to avoid having to attend the trial. Who is Big Mouth Larry to suggest cowardice of others?

We think that some explanation to the previous items lies in the hypothetical rationale in Big Mouth Larry’s feverish mind. If you want, the situation looks very much like crime investigation: The first suspects are usually those thought by investigators to get some kind of benefit from the crime.

One: By distracting its CEO, the oracle hits directly HP top managers. He would delay the effective start date at HP of Apotheker, and would have as well HP’s top managers sort of “distracted” too.

Two: All the energy and resources that Léo has and will have to dedicate to this issue won’t be therefore devoted to HP.

Three: HP’s reputation will be damaged. HP has already been too much in the news in the news because of legal matters: HP Board being sued by shareholder groups, HP suing Mark Hurd for lack of ethics, more shareholders suing HP for how the Hurd ouster was managed… not to mention earlier (and not so old) suit that cost the job to former chairwoman Patricia Dunn and so forth.

Four: Driving attention to Léo Apotheker in particular, and to HP and SAP at a broader level, effectively removes it from Mark Hurd primarily and Charles Phillips secondarily, much more tied to the oracle than to HP or SAP. This guys badly need it.

Five: Particularly related to Mark Hurd, this is a big favor from big-brother Larry… We could imagine, right after his ouster, Mark Hurd running out of tears to his tennis dear friend: “Larry, Larry, look at what they did to me; Larry, would you please stand for me?…”

Six: The self-assigned myth of invincibility and being above Good and Evil for Larry himself. Blinded by self-pride, the guy probably feels the need to prove himself and incidentally the rest of the world that his word is law… And a particularly sensitive community within the “rest of the world” is made up from the ranks at the oracle precisely. We would not be surprised if Big Mouth Larry expects his employees to fall down to their knees and surrender to the power of their Leader, like all those Ford-worshippers in George Orwell’s 1984.

It is said that Larry Ellison dresses in Armani suits. Being as rich as him, it is something that we could expect…Probably there are many Armani suits in the meetings and forums Larry attends.

   

Now, what we should not expect is to see are Armani suits in slum bullies brawling.

Elegance is more than just paying thousands of dollars for perfectly tailored suits, and ranking 6th in the list of wealthiest people in the globe…

If you’d follow me, it is not the suit: It is more the way you use and wear the suit. Armani, by the way, is just a label.

 

Tuesday 26 October 2010

Ferrari is red

 

We are entering into the final steps of the Formula 1 world championship. We’ve got Red Bulls, Ferraris, McLaren-Mercedes topping chances to win, and many others.

All of these teams manage quite a lot of money, don’t they? Well paid managers and pilots, lots of PR and press around… Quite a numbers of sponsors who invest little fortunes that could solve our lives for several generations to come. Lots of glamour, lots of technology as well.

There is no clear dominant team, and the difference between one and the other is measured in milliseconds! Huh, quite detailed and precise measurements have to be in place to differentiate a winner from a loser.

When we see each of these teams performing, whether in qualifying sessions or in the actual Grand Prize race, each parameter is measured, verified, checked, and calculated. We do not know the throughputs in their computers, but must be big… and reliable. And this is just putting into practice hours and hours of background engineering work at the same detail level and requirement.

At the end, the difference between two of these teams can be summarized in a single word: Details. As many as you want, as technical as you like. But details, at the end of the day. Just details.

And these details will mean, at the end of the season, that several of the teams that race this year will not be there in the next season, and their place will be taken by new upstarts who will have to face the challenge of the details to survive.

In the race for dominating the PC industry we can see as well great teams around: The Apples, the HPs, the Dells, the Acers, the Sonys… and trailing Fujitsus, clone brands and others…

Any of these do manage quite a lot of money… And have well paid CEOs and managers; lots of PR around, and quite a number of partners who invest little fortunes that could solve our lives for several generations to come. Lots of glamour as well (fishy CEO events perhaps, or sailing oracles, or HP, Acer, Intel and AMD sponsoring high speed cars).. and, yes, we were forgetting: Lots of technology as well.

There is no clear dominant team, and the difference between one and the other is measured in basic points in share performance at Wall Street! Huh, quite detailed and precise measurements have to be in place to differentiate a winner from a loser.

When we see these guys performing, whether in Consumer market or in big Enterprise business, each parameter is measured, verified, checked and calculated, with as well lots of time, energy, money and resources invested in background tasks, hidden to the external observers.

At the end, the difference between two of these teams can be summarized in a single word: Details. Just details, that make or break success.

From what we have read in the news recently, it seems that Ferrari is the likeliest one to get a pilot winning the championship. If you want details, Ferrari’s leading pilot walks slowly all the length of each racing track a few hours before the actual race to see closely every detail in the circuit and leverage that when driving. Ferrari is red. The best apples in America, are red too.

McIntosh.jpg

Curiously enough, the second likeliest team to place a winning pilot is Red Bull. Well, the only “red” they have is in the name.

Incidentally, Renault, who already quit its chances to win anything after two years of glory some time ago, is sponsored by a certain HP.

Monday 25 October 2010

Testosterone and medicine

 

It has been repeated in many different media that Larry Ellison (66), Pontifex Maximus at The Oracle finds IBM as its ultimate foe, or, more politically correct, its number one competitor.

That very same Pontifex Maximus, in a questionable move, recently hired a certain Mark Hurd (53), former CEO at HP, to join its board of directors, and serve as President for Sales and Marketing.

Hurd’s hiring started a controversial action from its former employer that involved a lawsuit filed against him on the grounds of potential disclosure of HP’s confidential information, which was finally settled for a bunch of dollars in stock, in our opinion. In the meantime, Larry Ellison, contrary to what could have been expected from his reputation, kept what could be thought of as a prudent silence, yet quite eloquent for our taste.

This last move was made at the expense of Charles Phillips (50), who has to leave his comfortable armchair to Ellison’s tennis buddy.

Charles Phillips

Charles Phillips, as we have mentioned in an earlier post to this blog, showed some habits that made Mr Hurd a natural replacement for him, by the way…

Funny enough, the now well known emulator of Tiger Woods has been appointed CEO at Infor, Not as important as the Oracle, still relevant in direct competition to Larry’s company.

Well, curiously enough, guess which are Infor’s strategic partners… Do you find the explicit references to something big and blue?

We have no idea of the details in Charles Phillips severance package from the Oracle, if any, nor we know anything about potential lawsuits against him from The Oracle in the name of Ethics or anything like that. We do not know if the Pontifex Maximus will be able to hold his mouth and prevents his tongue to be unleashed. We do not know either if Phillips plays tennis with Infor execs… But you would need to agree with me that the story is too good to keep it unwritten.

While the Pontifex Maximus tastes his own medicine, we will wonder what happens to men when they reach their fifties… is it a sudden unbalance in their testosterone index what happens at that age?

And, frankly, to those who still believe in Father Christmas and the ability of powerful public people to keep private life separate from professional life, now do you feel comfortable about having Charles Phillips advising President Obama about economic recovery? (Please note who sponsors the news)

 

Sirens’ songs and sirens’ screams

 

In times of economical slowdown and scary unemployment rates, there still can be found people that don’t seem to be lacking work for some time. It could be a good thing to see this if it were from the distance. Not for the HP Board guys, we believe, that are (again) getting stuck in legal stuff. This time it is Saginaw Police and Fire Pension Fund who claims justice, according to Bloomberg’s

Not at all good for the company they lead, as legal issues do not usually add value to shareholders, do they? Can HP afford losing more time, energy, resources and ultimately its reputation?

It may be argued that the main target here is (again) Mark Hurd, CEO at HP for the matter of this lawsuit. Still some names from the HP Board are being included there. But yet, the issue with finger-pointing Hurd is that he is just the main face standing for HP before court.

Will this impact Oracle too? We believe the impact in Oracle will not be significant. After all, Hurd has two strong execs to back him up at home, Larry Ellison as CEO and Safra-Katz as co-president. They will be able to manage, as they would even in the case that Hurd could be 100% on board. Still the guy’s reputation will be stained once more.

Time will let us know what goes on with this story, but we cannot help a compassionate smile after how fishy the guy is getting by the day: Trapped by Fisher-woman, haunted by the siren chants from the Oracle, chased by the siren screams from the Police and Fire Depts at Saginaw, Michigan.

We wonder how the guy would answer an invitation for dinner in a seafood restaurant…

 

.

They might hear…

 

Many times in their lives, in many different aspects of it, people have gone through having an idea, having a contribution to make to someone else, trying to improve things, attempting to feel valuable for themselves.

In those few cases where an eloquent and awkward, yet devastating silence is not the easy answer of those who already have made their minds up, it is not uncommon to get a polite smile back together with nice sounding words: “I hear you, but…”

These words are usually just a standard introduction to enumerating all the reasons that person has to let you know in front of everybody in the room how stupid you have been for attempting to speak up, and to make sure you understand your opinion will be treated with kingly disregard. The real plain translation is more about “I already made my mind up; I have been magnanimous enough to let you know about my thoughts.Now shut up, and do as you are told”.

Someone said that courage is what it takes to stand up and speak; courage is as well what it takes to sit down and listen; he was awarded a Nobel Prize, by the way.

How many times will we still miss a reply starting with “I listen to you, and…”

Sunday 24 October 2010

The Greater Evil

 

In an obvious reference to justifying an open alliance with Iosif Stalin, Sir Winston Churchill dared to publicly state that “If Hitler invaded hell I would make at least a favorable reference to the devil in the House of Commons”.

Quite a bold statement, indeed, for it was pretty much inconceivable at that time that the British people would find themselves friends with the arch-enemy, Bolshevik Soviet Union.

If we review Winston Churchill’s memories, we can even find traces of personal friendship (at least to Sir Winston’s perception) at the same level of the one the author declares for Franklin D. Roosevelt.

Of course, the situation in Europe and the rest of the world at that time more than justified such strange friendship, beyond a simple political and military alliance, and what Sir Winston really meant was that if Stalin was bad, Hitler and Nazism was even worse. He was choosing to oppose the Greater Evil.

However, we are not so unfamiliar to seeing weird friendships every now and them in areas such as war or politics, aren’t we? And, should we accept the thesis that business is not much different of war and politics, we should be used to seeing strange partnerships at different levels in this environment too. Like the case of the HP merger with Compaq, or the sudden reconcilement of Dell and EMC.

Furthermore, sometimes strange friendships in business go beyond mergers or alliances and reach individuals. The most recent case we have learned about has to do with Mark Hurd’s hiring by Oracle.

One of the most frequent reasons quoted to justify or explain Hurd’s acceptance of a job below the ranking of a CEO was that Oracle CEO Larry Ellison and Mark are friends, buddies, pals and other synonyms, besides the fact of playing tennis together every now and then.

Leaving aside that tennis matches by these two individuals would probably be similar to watching a Jane Fonda’s remake of one of her honeymoons (Ellison being 66 and Hurd being 53 is no sophomore match despite how gallant their sports style was thirty years ago), their so-called friendship still has a lot to go through to be understood or simply trusted. 

After all, Hurd was still leading the HP armies when Larry Ellison started a de-facto war by stepping into the hardware business after having purchased Sun Microsystems. A Sun in the Twilight was no match to Hurd’s hordes, of course, but backed by the power of the Oracle, it could quickly turn into a serious threat.

In such situation, it could not possibly be a part of the Oracles’ wildest dreams to get Hurd on board…but then mysterious Fate in the form of a non-sophomoric (Jodie Fisher is 50) scandal struck the industry, forced Hurd’s way out of HP, and opened the opportunity for the Oracle, who simply ignored everything after Hurd’s ouster and quickly got him into the ranks.

Hurd did probably not hesitate much, and soon was presented as co-President of the Oracle, reporting to Larry Ellison, in hail and praise. He succeeded Charles Phillips, who, by the way, was not precisely candidate to sainthood himself.

From bitter foes to intimate friends in a matter of days? Difficult to believe, despite whatever business HP and the Oracle might have done in the past, and despite how many “alliances” they formed.

Was not Ellison “making at least a favorable reference to Hurd in front of his own particular House of Commons”? We believe he did. And then, naturally, the next question is sort of obvious: Who is then the Greater Evil? Well, we think that Ellison is so proud of himself that he could eventually believe himself a sort of Hercules fighting against an Hydra or IBMs, SAPs, HPs and a portion of the rest of the Universe.

Going forward, we as well see deeper parallelism with Sir Winston’s case, if we look to the personal level of this weird friendship. As in the Churchill-Stalin case, there is probably a love-hate and fear-attraction mutual feeling between the two. In our opinion, Hurd wants to become CEO again, and should Oracle get to the dominant position Ellison wants it to be, hitting the CEO job by then would be a more than acceptable settlement for him to cool down his testosterone…

On the other hand, Ellison would crave the execution ability that Hurd demonstrated at HP, and keeping Safra Katz as the gatekeeper, just in case, at least while Hurd proved he would not screw up again, and returned part of his cost in results for the Oracle.

Forced equilibrium in any case between these two heavy weights (and heavy egos) that we do not really believe will last for ever and will potentially end up in a burst similar to the breaking of Stalin and the Western Powers at the dawn of the Cold War.

Both of them, Ellison and Hurd, will have to pay a price for it should it happen… Being the 6th richest man in the world would allow Ellison to afford it. In the case of Hurd, lets hope this time he goes for more mature toys, and does not pay the Fisher-Price.

God save the King

 

Sailing has been the traditional way of transportation by sea for ages. From small fishing boats to heavy galleons, all countries and all cultures have used it throughout History.

By the end of 19th Century, traditional sailing vessels gave way to steamers, and nowadays we even use nuclear power to propel ships, and classical sails have almost disappeared from our seas and oceans.

Replacing sails with steam engines was more than a mere change of technology. Sails and taking advantage of winds was a technology specifically designed for getting people and cargo over the waters to different destinations. Other than that, there was hardly any other use of wind or sails specifically for transportation (windmills do use wind and sails, but certainly not for transportation).

On the contrary, steam engines where not originally intended for ships or boats. The original target was being able to transform energy coming from burning coal into mechanical energy that could be used in many different ways. One of them was, actually, moving propellers in a boat, but as well it could be used to move a cart and, thus, opening room for the inventions of the train and cars, for example.

By the end of 2010, another technology has apparently been declared officially dead. Sony has recently announced the end of their manufacturing of good-old Walkman devices based on cassette tapes.

Far from being a mere change of technology, it’s apparent heir, the iPod, has been a complete revolution. From electromagnetic tape with a mechanical basis specifically designed for audio, we now have silicon-based chips to reproduce all sorts of multimedia content in an interconnected environment. The technology underneath an iPod was not either designed specifically for audio, no matter audio is just one of its applications.

Therefore, we believe iPod is not just the heir of Walkman. Discman was the heir of the declining product line. iPod is a complete change of dynasty. Not only has occupied the natural market space of Walkman; it has broadened it and its potential is such that many more competitors to iPod have appeared than Walkman ever had.

And nothing of this happened by chance… It takes much more than pure chance to replace a dynasty: Incoming Kings of the new one need to will it, plan it, execute it.

The King is dead; God save the King!  

Saturday 23 October 2010

The most from all of them

 

Successful leaders often rely on other successful leaders form the past, learn from them, and eventually follow them.

Businessmen are as well leaders, and we have seen, heard and read a lot about Mark Hurd, who seems to have been able to draw a lot of attention on him in the last months.

From certain points of view he has a successful career, and he does not seem to escape from the main thesis of this post, as we have noticed in his behavior some great historical characters he probably is following.

George Washington, first in war, first in peace, and first in the hearts of his countrymen, as delivered in his funeral oration.

Portrait of Thomas Jefferson by Rembrandt PealeThomas Jefferson: 3rd  President of the United States, builder of the Democratic Party,  One of the Founding Fathers.

Iconic black and white photograph of Lincoln showing his head and shoulders.Abraham Lincoln,  who saved his country from breaking apart during American Civil War, and signed the Thirteenth Amendment to the US Constitution forbidding slavery.

Alexander Hamilton, first Secretary of the Treasury of the United Sates. He established the Bank of the United States.

Andrew Jackson, 7th President of the United Sates, tough and hard, a clear dominator of his time, reshaped Democratic Party.

Ulysses S. Grant in a formal black and white photo. Grant is seated with arms folded. Grant looks weary and his beard is greying. This is the photo used for the $50.00 bill.Ulysses S. Grant, 18th President of the United States, war hero in American Civil War, commander in chief of the Union Army.

Benjamin Franklin, probably the most influential of the Founding Fathers.

Great men they were, great Americans, according to History, and it should not surprise at all they might have become role models for Mark. It would be consistent with Mark’s character and personality that he wanted to get the most of them. We think he will, come what may.

 

As a side note, it could be possible that readers of this post are not familiar to the portraits displayed above. In order to get the audience of this post more familiar to this great American characters, we display below more popular depictions of them, in the same order as above.

  

 

Apples might grow in Stalingrad

 

Throughout History, triumphant armies have always been typically portrayed as if they were made of the finest warriors, stronger than the enemy. Kind of super-heroes, if you want… and, certainly, superbly equipped. Of course, for specific cases where the main message to be delivered is special courage under clear adverse conditions, equipment could be deliberately shown as weak or even minimal.

From the first documented cases in Ancient Greece and in Roman History to modern propaganda, victorious warriors are depicted as sort of He-Men, way beyond Niezsche’s Übermenschen. This is, by the way, adorably represented in BBC’s Blackadder series (Blackadder goes forth), portraying the English Army in France in World War I.

Blackadder Goes Forth Poster

As a consequence, we tend to have a too simplified perception when it comes to war. We tend to think it is a matter of best equipment and best men and that’s it.

This thinking has played a huge role, in our opinion, in shaping the world the way it is today. From all the events in recent History, we honestly believe World War II could be singled as the individual event that has had the heaviest weight in the world we can see every day. Within World War II, should we have to choose a single milestone that determined the final outcome, we would pick the Battle of Stalingrad, as we think it was the turning point in the war. Before Stalingrad, it was possible for Germany to win the war. After Stalingrad, Germany was doomed. The same German High Command who made it possible to reach Stalingrad was as well to be held responsible for the disaster. around 300,000 troops surrendered in the limit of starvation at sub-zero temperatures.

It was not a matter of men: In fact, they were the same men that annihilated Poland, France Norway, Denmark, the Netherlands, Belgium, Luxembourg and the Baltic States and put Great Britain to what Winston Churchill called its “darkest hour” in 18 months.

It was not a problem of equipment, weapons or resources. The German Army that invaded the Soviet Union was way ahead of the Red Army of the time, whose only advantage was the number of available men, usually ill-equipped, by the way.

The real and fundamental problem there was supply chain. To put it simple, precisely for having better troops and better equipment, the German Army advanced far too much to reach Stalingrad, thus letting supply lines become extremely thin and vulnerable. The lines that connected the German advancing armies depended on too stretched supply connections that remained extremely vulnerable in their flanks. After holding, thanks mainly to the wide Volga river, the German advance in Stalingrad itself, the Soviets leveraged their only strength (the huge mass of foot soldiers available from Siberian units) to outflank the city and strike on the weakest German point, the supply lines. Outflanking the Germans from the North and South sides of Stalingrad, the Soviets closed the encirclement several hundred miles West of the Volga river, isolating the ful German 6th Army, that weeks later, in January 1943, unconditionally gave up to the last man of a mass of 300,000 troops.

Now we may change scenarios, and take a look to the guys with one of the best reputations regarding equipment and men. In a way, they are at war… and the crucial battle they are about to fight is the upcoming Holiday Season. It is going to be their own Little Stalingrad, as it could determine quite much their future, given the fierce competition they have in front of them and the potential amount of resources they’ll need to succeed.

We are talking Apple. Undisputed reputation as of their products as much as of themselves as a company.

And we believe they will succeed. They have thought beyond the standard clichés we spoke about in the above lines, and they have made sure that, no matter how far their supply sources are, they have:

First: Secured the sources, so they won’t fall short if the so badly needed ammunition, food, tools and spare parts.

Second: Secured the lines, allowing them to resist flank attacks and guarantee deliveries on time.

Third: They have optimized the size and container capacities so they can move as much material as possible at the minimum possible expense and resource consumption.

Fourth: Self assured on logistics, they can afford to exploit the initiative in battle.

Apples for equipment, brilliant staff for the men, solid planned-in-advance logistics altogether, definitely, do make a winning combination. Or, should you prefer, they make an incredible Jobs.

Footnote: We dedicate this post to a very good friend of ours who recently suffered a very important personal loss. A veteran from WWII born during WWI, huge human background and values that he managed to share and pass on to our friend. Rest in peace. Chap, please accept our deepest condolences.   

Friday 22 October 2010

No wedding, we’re afraid…

 

If you recall the last traditional weddings you might have been invited to, you will certainly remember the bride arriving to the ceremony. And if you squeeze a bit your brain, you might as well remember that she probably was late a reasonable time for. It is actually expected from her to be late on purpose, in order to increase expectation around her. But not too much. Arriving later than a reasonable timing is as worse as not arriving late at all. Like many other things in life, too much is as bad as too little, and finding the right balance becomes almost a form of art, not really at the reach of many people.

                                                             

There is still a second wave, a second wow effect, which spins around the scenery and the atrezzo around the bride. People will pay a lot of attention to any details of her costume, hairdo or make up.

All this wow thing is only justified for the uniqueness brides have around them during the wedding day. It is her guests want specifically to see, to talk to, or to get a nice picture with.

Being too late will, therefore, be a terrible sin for a bride on her wedding day… But still guests are likely to be a little tolerant and magnanimous as they are predisposed in favor of her. (Please note we are prudently avoiding to mention the classical guest, normally being the mother-in-law of some guest that justifies its mere existence with a lot of venomous critic they really enjoy spitting on the bride, the ceremony, the banquet and specifically on any guest younger then themselves). Being in this tolerant mood, should the sin occur, it might be forgiven if (and this is a big “if”) the bride avoids the second (and unforgivable) one, which is not looking magnificent form the top of her head to the end of her toes. If she doesn’t, there will be not a well-equipped enough toilet nor closet in miles around to fix a very bad first impression.

Should the bride have the slightest stain in her dress, the most unperceivable scratch in her make up, or simply one single hair out of its place, then the “someone’s-mother-in-law” effect will be unleashed as a thunderbolt throughout the guests and relatives, and something that was planned to be the most wonderful day in her life will turn into the worst, slowest and longest possible nightmare for both mortal sins, eventually leading to psychological issues for the bride and potential divorce in record time.

We have no idea about the social life or family setup of the guys responsible for the Windows Phone 7 launch at Microsoft. No idea either about their education nor manners.

                                                                              

But we seriously suspect the so-long-planned wedding between the market and WP7 operating system may not end like fairy tales. No matter if the bride’s father (ultimately a certain Steve Ballmer) is planning to throw in $400 million to ensure the most wonderful celebration. It could very well be ten times as much, result will more than probably remain unchanged.

First Sin: The bride has arrives real late. Too much even for the most unconditional fans and supporters of Microsoft, who, by the way, had not had too good experiences with previous girlfriends (ie Windows Mobile different versions), and while waiting for the bride, have been exposed to very nice-looking, well-educated and good-mannered alternative ladies (ie RIMM, IOS4, Android –yes, yes, we admit “Android” is not what you would call a nice-looking lady precisely). Even another late arrival as WebOS or an old-fashioned veteran like Symbian might be better considered than WP7 at this point.

Second Sin: Despite expectations, and knowing before-hand what the other ladies had been doing around for a lot of time, WP7 came handicapped: No matter how “Pure and Virginal” (Microsoft claims it was built brand new from scratch, breaking a historical family tradition of patching and patching it once and again, Service Pack 1 to Service Pack n), Apps are (very) limited, in the scale of 1 to 300 compared to IOS4, for instance; as well, App Developers are seriously restricted (no access to camera, for example) and basic features like “cut&paste” or flash capabilities simply do not exist. WP7 alone, conveniently hosted and supported by Microsoft, of course, threw away all the majesty that a proper bride needs for her wedding day.

If this were not enough, there is yet more…

In the classical marketing approach that Microsoft has accustomed all of us for years, once more they are overdoing themselves. Not happy with deserving eternal damnation without relief (those of you who have read some of the Bible know what we are talking about), they have already announced (vaguely, but they have) future upgrades and improvements that sound as scary as Service Pack Release Notes.

So Microsoft is planning to get the dollars from the customer and give him in return a limited product with limited development possibilities (already declined by some of the top guys there, like Layar or Fring), and a promise of having to travel though the desert for an unspecified period of time to eventually get to the end state they are supposed to have paid for. Simply fantastic… but only for making the script for a Hollywood B-series moviestarred by Barbra Streisand, Diane Keaton or Meryl Streep, so sad a romance this sounds like.

Whoever ends up willingly with the knot tied must really love this bride…

…what probably is a sacrifice Apple, HP, Nokia, HTC and others may be willing to assume.