Remote/hybrid work: When change is forced upon industries

 

     The recent pandemic hit the world hard. There were the horrible direct effects of death and lingering illness. A colleague lost his mother and an uncle to the disease and many others grieved. But there were also many indirect effects. Industries that were associated with travel ground to a halt. Most industries found themselves in the position of being required to learn how to work remotely.

     Remote work was not created by the latest pandemic. Remote workers have existed for a long time. It has long been used and discussed but, without impetus to management for change, little had changed over the years.

     Within the "cottage industries" (textiles made an extensive use of such), people in their own homes would be assigned work that they were expected to make of a certain quality within a given time. The cottage industries extended the square footage of the factories by making use of a network of physical spaces.

     Beyond the cottage industries, a certain degree of remote/hybrid work has existed for many other areas that require, or allow, movement from place to place as part of the job. These job categories include customer support, article writing/journalism, sales, and other mobile-requisite tasks.

     Prior to the latest pandemic, however, little shifted from year to year.  The recent pandemic forced most businesses into a remote/hybrid situation. Forced change usually means difficult, and uncomfortable, change.

     What were the results? Some industries had travel an integral part of their business and they were hit hardest. Factories, which required people to be present, had difficulties. Newly created (not the ones that had already been in existence) remote education had very erratic results (my 3 sons' colleges were quite inept at handling such). Restaurants shifted to delivery but suffered from personnel problems. Many industries in which the product wasn't physical shifted to a "cottage industry" model. But the economy survived -- it did not all collapse. Most businesses found that they could survive, and some even thrive, with a remote workforce.

     Survival does not necessarily mean thriving. Could the company do as well, or better, in a remote situation? In some cases, the answer is yes as measured by output and revenue. What about long-term? Can they continue to grow, innovate, and produce in a remote situation? What about a hybrid situation? Is that an improvement or does it end up with some benefits, and some problems, of each?

     There isn't a single answer for companies. Much of the overhead pain of transition has already been taken. It is a good time for serious analysis and discussion; it is unlikely to be beneficial to try to quickly retreat to old models.

     An important part of evaluation and consideration is feedback on how well the process is working. In my next blog, I will talk about factors on judging success.

The Peter Principle: Levels and Ceilings

 

     Lawrence J. Peter published his "The Peter Principle" back in 1969. It was considered, in part, "tongue-in-cheek". Not fully serious. But, like the Dilbert views of management, there is still a lot of truth to the idea. At the base, this principle says that a person will rise to a level in which they are no longer competent. If taken to extreme, this says that a lot of positions within management will be filled with non-competent people. The only competent ones would be the ones still in the process of rising to their own, individual, levels on incompetency.

     In order to weigh the realities of this, it is important to understand the reasons people get promoted and how they actively try to achieve promotion. People get promoted because of time, connections, rewards for accomplishments, and demonstration of required skills. People actively achieve promotion primarily via self-visibility and networking.

     The factor of time is especially important within strongly bureaucratic organizations. Government positions are often of this nature. There are strictly defined employment "levels" and it is expected that people will rise from one level to the next within a specific range of years. Thus, some rise more quickly and others more slowly but all are expected to rise in a steady fashion. This has some merit in that it is possible to gather applicable experience as years progress (it is also possible to avoid gathering experience and, instead, make use of methods of avoiding actual work).

     Connections can include nepotism but it also can include general networking. In the case of general networking, it usually means being brought in to a position from outside the company rather than being promoted into it. Within certain types of businesses, having a large active personal network may be considered to be an attribute useful to the company and a factor for promotion.

     The factor of awards for accomplishment seems to have merit. A promotion usually includes an increase in salary, perks, and title. With these, an increase in authority and recognition usually occurs. The problem with this route of promotion is that the skills, for which the person is rewarded, are not necessarily the skills needed in the position to which they are promoted.

     The other major path for promotion is demonstration of required skills. This requires active participation by current management -- preferably the person to whom one reports. Tasks are delegated, skills learned, and eventually the person can "step into the shoes" of the person to whom they report. These required skills can be obtained in other ways but recognition, and rewarding, of such becomes more difficult without active management participation.

     The factor of time just requires a calendar and the ability to check it occasionally. Other paths require that the person be noticed. This varies a lot between different work cultures. In some cultures, a person can explicitly self-promote -- "see what I've done, can you assign me to that, are there any positions opening up for promotion?". Doing this can be difficult for many people. In other cultures, active self-promotion can be counter-productive as it can be seen as not being part of the team.

     So, with these ways of being promoted, what about the "Peter Principle"?  Both time and awards have considerable danger of the person not having the skills needed for the level to which they are promoted. Developing the skills SHOULD, inherently, mean that the person is qualified for that next level, It often may do such but there is also the possibility that the skills learned are not the skills needed for continued promotion.

     With such caveats, it looks like the Peter Principle can still often take place. There is nothing wrong with a person hitting a ceiling -- as long as they are qualified for the position in which they rest and if they are not actively prevented from acquiring the skills, experience, and ability to continue to rise. The latter often occurs within company cultures and may make it difficult for the culture to change or to accept all those who can positively contribute to the value of the company.

Clients vs. Customers: just words or a real difference?

 

     Most languages have a fluid vocabulary. A word can mean something in one year and -- in another year or ten years or fifty years -- have a different meaning. Sometimes the meaning can even flip; a "good" word can become a "bad" word. Some languages, such as French, have monitoring organizations to attempt to control the language. Of course, people will use language as they will no matter what the dictionary says.

     When my business partner and I had our company, one of my many hats was as head of client support. This was quite apart from customer support. Most of our clients included repeat business over a span of ten to fifteen years. We did not want to sell them something that would fill our pockets but not meet their needs. I like to think that this was, at least in part, because of our desire to do "the right thing", but it was also looking at the relationship from a long-term point of view. A client, for whom we did our best, became a referring client and a long-term, repeating, client.

     We had an excellent percentage of repeat business -- around 90% of our clients either referred some other company to us or purchased more products at a later time. And, within the world of software, people that we worked with at one company often moved to another company and, when need arose, they thought of us to supply their needs.

     This did not always work out, of course. We had clients who "disappeared". They had problems and, instead of reaching back out so we could work with them to eliminate the problems, they huddled together and failed. I'm sure that we all know both individuals and companies who take this path. In one case, this happened but it happened deliberately because they wanted a scapegoat for poor product decisions that they had made.

     90% is still a good record for a company. But what about customers? Would treating them as customers have really made a difference? It depends. If a person uses both words as largely synonymous then there is no difference. But if a customer is a one-time transaction and a client is an ongoing relationship then there is definitely a difference.

     More than thirty years after having co-founded the company, I am still in touch with some of our client companies and people who have worked with them. We are no longer actively supplying product -- but we can still offer suggestions, and advice, when asked.

     There have been no regrets that we approached each company as a client.

Odds are for the future: a brief chat about statistics

 

     Something happens. Something unexpected. A person near you says "what are the odds of that happening?" Well, since it has already occurred, the answer is 100%. Without a parallel universe, the chances of it NOT occurring no longer exists.

     In statistics, this situation is expanded by the concept that the past has no bearing on the future. If the odds of something occurring are 5 to 1, then after the event has occurred in the past then the NEXT odds of something occurring are still 5 to 1.

     Every time you flip a coin (with a fair, properly balanced, coin) the odds are 50% heads 50% tails (yes, with that very small possibility of landing on edge left out). If you toss a coin and get heads seven times in a row then the next time you toss it the odds are still 50% heads/50% tails.

     Now, if you anticipate the future, you can determine the odds of getting heads seven times in a row (1/2 * 1/2 * 1/2 * 1/2* 1/2 * 1/2 * 1/2 == 1/256) for the future. But every time you flip the coin, the odds for that flip remain the same.

     The phenomenon of people expecting the past to affect the future exists in many people -- good luck/bad luck. It exists in all addicted gamblers (the scientific gamblers are a different matter). That lucky streak just HAS to affect the future. (It doesn't.) I had an uncle who won the state numbers lottery (not a huge amount at that time -- but significant) and he put the money all back into the lottery system until he no longer had any net winnings.

     There are situations where the odds do change with time. This is true for actuarial tables. Your odds for living to a certain age changes with each year you live. If you live until you are 75, your odds of living until 85 (10 more years) are better than the odds of you living until 85 from the age of 55 (30 more years). But, be assured, the insurance company has it well planned out such that, on average, they are not going to lose money. Those tables require ignorance of the future to follow the actuarial odds. Robert A. Heinlein's story "Life-line" indicates a way to beat the system -- but it may be the only one.

     There are also situations where the perceived odds -- what we think exists -- are not the same as the statistical odds. Professional gamblers are aware of these situations and, by gambling calmly and without emotion, succeed in taking advantage of them -- over the long run. This also happens in other areas of investment and helps certain investors increase their likelihood of beneficial returns.

     All venture capital firms rely upon both experienced analysis and spreading their risks. Five investments of 10K still gives a good profit if two are totally lost, two give back 15K each, and one brings back 30K.

     "May the odds be ever in your favor."

Back to basics: Supply and demand

 

     The economic theory of capitalism has, as one of its basic aspects, the idea of supply and demand. This blog may be "old news" to many -- but not to others.

     The amount of product (supply) at a given price tries to reach a balance of demand and willingness/ability to pay. Under many conditions, this works as a self-maintaining mechanism. There are quite a few cases -- sometimes called "edge conditions" -- in which it does not work well. These cases include newly introduced products, pandemics, shortages, monopolies/cartels, and other cases where the balance gets thrown off rapidly.

     No company wants to sell a product below the cost needed to manufacture and provide. However, there are cases where this may be to their advantage. One is when demand has gone down so much (temporarily or permanently) that they have the cost of storing a large amount of inventory from which they don't expect a profitable return on investment. Another is as a "loss leader" -- making the price attractive to attract potential buyers of other, higher profit, items (often done by grocery stores). The final one mentioned here is that of forcing the competition to quit. A company with "deep pockets" (money available in reserve) can force their competitors to stop making competitive products. Usually this is legal but will often leave widespread bad feelings.

     Newly introduced products will require development, marketing, and promotion. The creator of the products hopes that these costs will be covered by eventual sales. But, at the beginning, they will likely need to sell below cost while building a market. When Honda introduced the higher-end Acura line, they priced the cars very close to that of their Honda line -- increasing the price as the brand-name recognition developed.

     Pandemics are special cases where both shortages and surplus can exist -- even at the same time. When most people stopped driving and stayed at home, the need for gasoline plummeted and the price of gas went down (not to the same extent). But fewer trucks on the road, and ships and trains moving product, and fewer people to staff the fields and factories can (and did) lead to shortages.

    Shortages indicate less supply than potential demand. In addition to pandemics, it can be part of a situation where production is reduced on purpose (oil, for example), because of disease (bird diseases causing reduction in chicken numbers), because of environmental problems (droughts, floods, unexpected hot or cold temperatures, ...), and deliberate reduction in cases where there is little competition (arson of facilities and other methods). There is usually no inherent requirement to raise prices when supplies are not enough to meet the demand. But, with only some product available to a larger set of potential consumers, how is the final market determined? By lottery (this does happen for certain products -- like the PS5, for example)?

     More often, the company increases the price. The higher the price, the fewer people want/are able to buy the product. At some price, those willing and able equal the amount of product. Record profits can be made and the supply and demand balance. For optional products, this works well. For required items (such as food), lower income people are greatly penalized. Note that, for longterm production shortages,  it is expected that other companies will start manufacturing (not true if it is caused by limited resources) and the competition will force prices back down as the supply increases.

      Monopolies and cartels allow companies to control the supply and price directly while eliminating (through agreements, buyouts, or less legal methods) competitive pressures. In the US, many laws were enacted following the Great Depression hoping to bring such under control.  A desire to increase or decrease such laws and the proactivity of enforcement of such laws depends upon current political vision. Other than those laws, business practices and prices are (in the US) controlled solely by the companies.

     In theory, the number of products at a particular price will (eventually) balance against the number of people willing and able to purchase at that price. But there are many detours around theory.

     

Judging versus Awareness: A difference of right and wrong

 

     I love books. But I also want others to be able to share in my love of books. So, I share them with others that I believe will appreciate them. Sometimes, they don't come back in the same condition that they went out in. Coffee rings. Bent covers. Folded over corners. Sometimes even rips or markings. The book will never be the same again. Who cares?  Many see a book as a transient physical object that has a limited lifetime. To them it's just not a big deal at all. But to me, it is very sad.

     When I was young, I would get angry at things of this nature. As I have aged (the jury is still out as to whether I have matured), I have recognized that this is not an issue of "right" or "wrong", "good" or "evil". Nevertheless, it is known to be a likely behavior that the person will treat books in this manner. So, from that point on, I will only share a book with them that I am willing to consider a gift (in fact, rather than loan I may just give it outright).

     Moving from judging to awareness. When you are judging -- there is a verdict. That verdict is based on societal, and your own personal, standards. For some things, those standards are close to universal. For other things -- definitely not. My wife and I were greatly surprised, when eating in Norway, to see the other diners eating their hamburgers with a knife and fork. They were probably equally surprised to see us pick them up. Good or bad, it would be appropriate to make sure that new guests have a knife and fork available when inviting them over for hamburgers.

     If someone you know often loses things, you try not to loan them things you want back. If someone is a driver who gets many driving tickets and is in accidents more than average, you may not want to loan them your car or accept a ride from them.

     It is difficult to come up with examples that won't be offensive because, for almost all of us, the standards that we grew up with are "the way it is". Especially in the US, where only a small percentage have learned other languages or visited other countries, it is difficult to recognize that such standards are not universal. The new global online society is beginning to expand that circle of awareness but, as is true of many things, change comes with the young.

     For me, pirating is bad. If someone has created music, video, software, games, or whatever then they should receive value back for what they have given (the value does not have to be money). But I have had it repeatedly pointed out to me that, if something is pirated, no loss of money exists because the person otherwise would not have obtained it. Parts of me can see both arguments but it is not a universal standard. Still, companies and people are allowed to be aware of it -- even try to prevent it -- even if they don't all agree on the morality of the issue.

     So, judging requires a verdict. That verdict is not universal. But awareness of the action, or behavior, is universal and is appropriate to be used as a criterion for how you interact.

Deepfakes: a growing dilemma

 

     In the movie "Rising Sun" (1993, Wesley Snipes, Sean Connery), a murder mystery is put forth. The focus of the movie is that of an examination of Japanese culture (from a gaijin point of view) and how it factors into matters of guilt, innocence, and the assumption of penalties. However, a very important part of the plot is the existence of a video which appears to indicate a certain set of circumstances. As a spoiler (but a spoiler of a 30-year-old movie), it turns out that the video has been faked. To the best of my knowledge, this is the first use of deepfakes as a plot point in a movie. But this was not a perfect deepfake and discrepancies noticed were used to break the case.

     This was 30 years ago. The plot indicated that the fake was created at speed due to an immediate need for it. Still, it was pretty good. Technology developed over the past 30 years has gotten to the point where it is more and more difficult to be able to definitively determine whether something is accurate.

     "Live" broadcasts cannot (yet) be faked. But, the contents of such broadcasts require the constancy, and accuracy, of human memories. There are instances of live videos whose contents are drastically reinterpreted within days or weeks. And, like the plot in "The Sting", it is possible to put a delay into "live" broadcasts to allow for alteration before release.

     Deepfakes of video or audio can either be altered or synthesized. Faces or voices can be substituted, clothes can be changed, the background changed, parts of one video can be merged into another. All types of changes can be done. In the case of synthesis, we are looking at a CGI movie situation. Completely creating human, and animal, images which seem real upon close examination is very close (perhaps, in lab situations, already accomplished) to reality. If there is "cheating" by using archived video footage then it is even closer to impossible to detect.

     In addition to the possibility of something being faked, the mere possibility adds to what is referred to as "the liar's dilemma" -- where something is called a fake even though thorough analysis is convinced that it is not.

     Of course, this is presently expensive to do. It is only done by those groups, companies, or governments with great resources and no limitation on use. The closer to being undetectable (unprovable) that is desired, the more expensive. But it gets cheaper, and easier, by the day. There are small minorities within the world that already think that past events never happened -- even though, at those periods of history, deepfakes were not technically possible and certainly were not cost effective.

     What will happen as our documentation, and historical storage, of events is created now and into the future?