Category Archives: technology

Blackouts or Nuclear Power – UK’s stark choice

The map shows the commercial nuclear power pla...

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There’s a good deal of talk about power today: oil prices retaining their high levels in spite of Saudi offering to make up any shortfall due to Libya, nuclear back-tracking following the earthquake and tsunami in Japan, and so on.

How, the media seem to be asking, is the UK going to be able to generate sufficient power for its needs in an affordable manner?

Consequently, attention is turning increasingly to sustainable power – particularly as today (27th June), when much of the South East of the country saw temperatures break the 30C mark, was a day marked by the switching-on of the UK’s largest solar power plant, one near Wallingford in Oxford that is expected to generate nearly 700 megawatt-hours of electricity per year.

The trouble is, it’s just not the answer. Nor is wind, tide or any of the other “new technologies” being spoken about.

At present, around 75% of the UK’s maximum power generating capacity is from fossil fuel sources (oil, coal and gas). But, as we know, these resources are being depleted rapidly all over the world (and that’s apart from the well-documented problems of global warming being brought on through the use of fossil fuels). However, for any country – including the UK – to continue to see economic growth, its power requirements grow. In fact, it is estimated that the UK’s power generating capacity will have to increase by at least 25% in the next 10 years – and this figure may be low if oil reserve issues accelerate the necessity to move to electric vehicles.

“Green Technologies” such as wind and solar suffer from a major drawback – a lack of reliability and predictability (and that’s before looking at cost issues which are significant – huge government subsidies benefit the builders but have to be reclaimed from the tax-payer). The fact is that while they will generate power during periods when the wind blows and there is sufficient daylight, this is far from constant, and power is needed on a 24-hour basis. It’s simply impractical from a cost, space, etc., perspective to store such power (assuming you’re generating excess) to any great extent. Yes, the UK has some level of stored-power reserves (mainly using pumped storage technology), but this is limited to around 3% of maximum capacity at present and is unlikely to be able to be increased to any great extent.  So, solar and wind generators need to be backed up by other technologies that can be switched on immediately the wind or light levels drop – effectively meaning a doubling of peak capacity.

Wave power and Tidal power technologies, although more constant, have not yet proven sufficiently scalable, nor reliable, to be of significant practical use either.

Hydro-electric power is well understood, but the UK geology does not really suit it – which is why only about 1% of current electrical power is from hydro-electric schemes here.

The only practical answer is nuclear.

I recognise that this is a highly emotive topic, particularly in the light of the recent events in Japan, but the facts are that today’s technology makes nuclear plants infinitely safer than just about any other form of power generation. Of course, care needs to be taken that they are not sited where natural disasters are likely to cause a breach of the all-important containment vessels, but the UK is fortunate in being extremely stable geologically, so this is not an issue.

Nuclear “waste” – the by-products – can now be safely processed to remove the contaminants and reuse the rods in existing plants, or to utilise other up-coming technologies such as fast-breeder and fusion which can utilise the waste products.  Incidentally, Scientific America published an article showing fly-ash from coal-fired power plants pumps 100 times more radiation into the surrounding environment than any nuclear facility today…

France today generates something like 85% of its electricity, China is looking at 132 plants by 2030, Korea is planning to obtain 50% of its power from nuclear sources by 2020, as is Japan (still).  The UK simply has no option but to embrace nuclear power – and to do so quickly – or face much higher utility bills and a “return to the dark age” as power shortages loom.

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Communication in the Information Age

Note: the plate says - "The quick brown f...

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Johannes Gutenberg’s invention of the printing press in 1440 heralded the start of mass communication – for the first time, text could be reproduced quickly and inexpensively for a large audience. Of course, very few people could read in those days and many authorities were against it, fearing the impact of mass uncontrolled communication on their rule, so it took a few hundred years for this to spread.

The introduction of broadcast radio from 1920 started to spread information even more quickly and widely, marking a significant jump in the speed of communication.

But it was the Information Age which has really accelerated global communication.  Widely accepted to have started in the 1970s with the advent of the microprocessor, it took the introduction of the Internet Browser in the early 1990s for the Information Age to really become as integral to life as it is today.

And yet, it seems, the Information Age is just a quicker way to spread the same sort of information as before. Certainly our main sources of news seemed to have missed the point – news bulletins rely on “sound bites” or their video equivalents to relay information with the result that this is often inaccurate or, at best, unbalanced. Newspapers, too, have not really worked out how to embrace the digital age fully – you either get print (almost as in 1440, albeit more quickly), or the same articles available online, missing the opportunity to have summaries of stories and the ability to drill down for more information.

This is the key – we’re bombarded with information from multiple channels but have not developed the tools to effectively sift it. Long messages are often ignored as we don’t have time for them, while short messages are frequently taken out of context missing the real point that was being made. What’s needed is the ability to capture the essence of a point in a short burst and then enable people to get more information as they require it – almost an inside-out onion, with successive layers giving more and more detail.

Twitter is a great example of the modern communication paradigm – 140 characters to get the basic message across, including a link to more detail, which you can access if you wish. That more detailed message, in turn, could have links to other sources for even more information, and so on…

Nowhere, perhaps, is this communication problem more evident than in politics. There’s no argument with the fact that the UK, like many other countries globally, has woefully overspent and has to completely revisit its bloated public sector spending (how can a majority of the workforce be civil servants – effectively paid for by the minority?).  And yet it, like so many others, is facing widespread revolt at the prospect – look at the pension reform issue, for example…

Why?

Primarily because the government is incapable of effective communication. White papers, government statements and debates are far too long and not suitable for the news media or the viewing/listening/reading public, so people simply don’t understand the issues. I absolutely believe that the vast majority of people are decent, willing to work hard to get ahead and happy to help those less fortunate (but NOT those that are not prepared to help themselves).

But, for as long as governments cannot get the message out in a way that the media can carry without distortion and people can understand in just seconds, they will be unable to implement the changes that are needed, worsening the financial state of their countries, prolonging the agony and the economic downturn.

It’s time to turn traditional communication on its head and embrace “the 140 character world.”

Who Controls Your Brand?

social media compain
Image by Laurel Papworth laurelpapworth.com and Gary Hayespersonalizemedia.com

The old order is being turned on its head; companies used to being in control of their customers and their brand are now finding customers are wresting control from them and that they need to adapt or face obscurity.

The enabler behind this is, of course, social media. Customers are now able and willing to discuss their experiences with friends and followers around the world, and companies ignore them at their peril. And yet, it seems to be more common for companies to ignore what is being said on Twitter, on Facebook, on LinkedIn, on YouTube, and on all the other social platforms around the world.

Even though some two thirds of Fortune 500 companies have a Twitter account, and more than half have Facebook and YouTube accounts, they’re just not listening – reports indicate that 43% of all companies have never responded to a single Tweet, while only a quarter of companies respond to a comment posted on their Facebook page.

All this does is reinforce the view that companies are not interested in their customers. Better to have no presence at all than a presence where you don’t respond (the same goes for “customer-service” telephone lines and email addresses!).

However, the fact of the matter is that nowadays you HAVE to listen to what your customers are saying and you MUST respond. That’s the best way to turn customers into brand advocates – and isn’t that what every business wants? What’s more, it’s worth remembering that your products and services are only as good as your customers think they are and that they’re prepared to pay for; it’s much better to know they’re unhappy sooner than later, so you can fix the problem.

Word of mouth has always been the strongest way for businesses to grow – or shrink – and all that social media is doing is enabling this process to operate more quickly, and a lot more widely.

Companies that have embraced this – think Zappos and Starbucks (or Threadless, the T-shirt company that went from startup in 2000 to $30M in revenue last year) – are rewriting the rules for customer service, marketing and the way they’re perceived. Ask Comcast, who went from ignoring social media to an advocate and transformed the company’s image.

While the positive impact is clear and quick to see, the negative impact on companies that do it wrong will take longer to be really apparent – they suffer a slow, steady decline in brand image with all that follows from this – so the good news is there’s still time to adapt, but they shouldn’t wait too much longer.

As Jeff Bezos said, “Your brand is what people say about you when you’re not in the room.” If you’re not in the social media room, you’ll never know – and what you don’t know, you can’t fix.

By embracing social media, having conversations with your customers and other stakeholders, you will greatly strengthen your brand and your company.

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The End of Cash?

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It’s interesting to see the number of recently introduced products coming to market which are designed to, in effect, remove the need for cash.

One that has garnered particular attention recently is, of course, Square. This comprises a small application that resides on your iPhone (or iPad, iPod Touch) or Android phone, together with a little reader that plugs straight into the audio input jack of the phone and turns it into a personal credit card payment machine that will allow the user to accept credit card payments from anyone for a small fee (typically 2.75% + 15c). With no costs for set-up, application or card reader this is sure to change the game for those tens of millions of small businesses, traders and professionals that have, until now, fallen outside the electronic payment net because they are too small for the card companies to serve cost-effectively.

But Square is not alone – Obopay allows anyone with a  mobile phone to set up an Obopay account and, for just 25-50c (plus 1.5% if you’re using a credit card to fund your account) send money – in other words, make a payment – to anyone else with a mobile phone, whether or not that person already has an Obopay account. Again, there are no setup costs.

And then there’s Intuit with its GoPayment service that also enables credit card payments from a mobile phone – this time with a Bluetooth reader – at a cost of 1.7% + 30c per transaction, although this service does have a monthly service cost of $12.95 attached to it (I wonder for how long, though, given the competition above).

Doubtless there are many others, too, either in stealth mode at present or on the drawing board.

What’s more, these systems allow you to build purchase histories by customers, offer loyalty programs and great levels of service more simply than the straightforward cash systems did – so even the smallest businesses can step up their marketing at little or no cost.

At present, all these products only work for you if you’re a US-resident/business, but it’s only a (hopefully short) matter of time before they go global and the way of transferring value changes forever from cash to electrons. No more looking for change, worrying about how the currency in a new country you’re visiting works, being concerned whether anybody’s watching as you withdraw a large amount of cash from an auto-teller…. And, of course, if you’re a small business, no more concerns about having the right change for those large notes that auto-tellers like to give, about the value sitting in your till, or being worried when taking your cash to deposit it.

It’s going to be interesting to see how society changes over the next generation as we move from cash altogether. Will the nationalistic bonds to a currency (and the resulting issues of payments from/to different countries and with travel) be removed, and could we find a common global currency?

And, of course, we’re seeing the continued drive for the mobile phone to be less a telephone and more a personal digital assistant in every way – clock, alarm, calendar, address book, diary, music player, radio, newspaper, camera, voice recorder and now, wallet. As an aside, it’s interesting to see how many of the Generation Ys don’t wear watches – their phones tell them the time. Has the watch industry got an answer to this, its potentially biggest threat?

We’re at a very interesting point in the 5000 year evolution of money as we know it. Will it disappear completely as a physical object in the next 20 years?

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Living Your Brand – do companies really care about their Brand?

Goldman Sachs Tower in Jersey City
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2010 certainly seems to be going down as the year when the proverbial corporate skeletons are coming out of the cupboard:

  • Toyota – which had built its brand on reliable, safe vehicles – recalls many millions of cars all around the world in an apparently ongoing saga, with new recalls being announced almost monthly;
  • Goldman Sachs – viewed by many as the pre-eminent merchant bank – being sued for fraud by the SEC and now under investigation by the UK regulators, too;
  • Many airlines – especially those using words like “Favourite” and “5 Star” in their advertising – simply refusing to abide by their legal obligations, in terms of Regulation 261/2004, to provide accommodation and refreshments for their stranded passengers during the volcanic eruption in Iceland.

And this is just a sample of the more recent headline-grabbing issues.

Are they really “Too big to fail” – or just too big to care?

I suspect they believe the latter, not recognising the truth in the old adage that “Pride comes before a fall.” Remember, almost none of the largest and then most successful companies in, say, 1900, are still in any position of strength today – in fact most have disappeared altogether.

These corporates need to get back to basics, to remember that it is their customers that pay their salaries and to start treating their customers as the company’s most precious resource, rather than as a necessary irritant. Simply repeating a marketing mantra branding themselves as the pre-eminent company in their field doesn’t make it true…

The fact is that branding is a lot more than just a logo with a catchy by-line – a company’s brand is everything to do with that company, and the logo is just something to recognise it by as we’re visual creatures. Branding is about customer service, branding is about the way customers interact with the company in all ways, branding’s about staff training, branding includes corporate governance and social responsibility, branding is about all the materials that company produces – from marketing through packaging to the products themselves – in fact, branding is about everything to do with a company.

And this is where so many companies are falling down: they’ve lost sight of everything but the short-term pursuit of the bottom line. And I use “short-term” advisedly – as without attention to all aspects of their corporate brand, those companies will lose customers and start to fail.

Just look at the consumer backlash against many banks that they perceive to have been complicit in the economic downturn. Imagine how consumers who have been poorly treated will feel about giving more of their hard-earned money to those airlines that left them high and dry. Will former Toyota buyers be as happy to buy another Toyota?

Companies need to start refocusing on their entire brand, they need to recognise the power of instant communication for their customers and embrace it to make a positive difference, and they need to once again really put their customers first instead of just saying they do.

What do you think – do companies no longer care about their brand in pursuit of profits? Have you joined the growing ranks of disgruntled consumers and, if so, which are the brands you love to hate?

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Twitter – The “Next Big Thing” for Business

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With Twitter set to pass the magic 100 Million user mark later this month, or early May, and the company having been valued at around a Billion Dollars last year, it’s moved from the realms of novelty. So, should business sit up and take note; is it the “Next Big Thing” as a business tool?

Speaking with business leaders and marketers, one gets mixed responses – the enthusiastic advocates on the one hand, and those that hope it will fade away as it can potentially damage their company, they believe, on the other.

There’s no question that any public forum can be used by people to disparage, or worse, a company, but is that a reason to abstain from that forum, or should one take the opportunity to embrace it and counter any adverse remarks? After all, unhappy customers that are turned around tend to become the most loyal advocates…

Others look at Twitter and ask whether 140 characters is really enough for any sort of meaningful dialogue with customers and dismiss it on this basis. But in our information-overloaded world, is brevity not a blessing?

Properly used, there is no question in my mind that Twitter really can become a significant business tool:

  • Customer service – probably the first Twitter application area to be embraced, companies like Southwest Airlines, Staples and Zappos have found it invaluable to track unhappy customers, respond quickly and show a great service ethos.
  • Sales leads – of course, great customer service leads to sales, but many more companies, like Dell, Sony and Starbucks are using Twitter to promote products; in fact an article last month reported Sony measuring over £1 Million in sales directly attributable to its Vaio Twitter account.
  • Promotions – an extension of the sales leads application is using Twitter for promoting special offers to followers. As the integration of GPS technology with phones increases, these could even be location and time specific, making them highly targeted.
  • Product feedback – companies are often accused of making products that customers don’t need, or of not including “obvious” features. Twitter can give a window for listening to the needs and views of a very wide customer base.
  • Order tracking – an area I’ve yet to see, but one I think is an obvious one: imagine being able to Direct Tweet to a courier company and get an automated response as to where your special delivery is in the system…

In fact, the possibilities are endless – limited only by imagination. With Twitter, companies have access to an incredible mass direct marketing tool without the dangers of being considered spammers – people would simply unfollow those they consider annoying – and one which can provide real-time, real-person feedback on an incredibly wide range of issues.

Twitter, I firmly believe, is poised to be the “Next Big Thing” for business, and companies that ignore it do so at their peril.

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Does “The Cloud” Make Sense for Business?

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The interest in Cloud Computing has grown exponentially in the past few months with a quick Google search on “The Cloud” and on “Cloud Computing” yielding over 25 million articles between the two phrases.

Suddenly, it seems, this is the panacea for all that ails in the technology space – or is it?

There is certainly a good deal of ongoing investment in giant data farms – although the cost of power required to run, and cool, these massive installations is now causing serious concern. I’ve seen estimates of up to 100MW for a giant server farm under development, with 50MW farms apparently not being unusual. Consequently we’re seeing imaginative schemes to overcome this in advanced stages of investigation – ranging from hydroelectric schemes in particularly cold countries with good water, like Iceland and Finland, to Scottish tidal power, to some companies even investigating building sea-platforms that use wave energy for power and sea water for cooling.

However, there is equally a slow but steady increase in governments wanting to monitor data traffic – apparently for security reasons, although I suspect there may be oversight by the fiscal authorities, too. Even Australia is talking about Internet filtering…

All of this is adding greatly to the conversation, of course, with equally strong lobbies on both sides of the debate – much around whether Cloud Computing is taking us back to the old “mainframe and dumb terminal” computing days or whether it’s taking us forward to an more secure, cost-effective era, albeit with the possibility of less flexibility with systems and information.

In my view, though, the issue of whether to adopt a Cloud architecture or not comes down to individual companies and applications – and for the purposes of this discussion, I mean a public Cloud architecture, rather than one owned by the end-user company.

To my mind, the companies that should strongly look at this approach are the SMEs (Small and Medium Enterprises). The reasons here are straightforward economics – few will have the staff or the capital resources to have a fully secure IT infrastructure, complete with Disaster Recovery. This means multiple servers in multiple locations, interconnected by very high speed links and a significant IT team managing it all, with a strong security system. By adopting Cloud architecture for most applications – including that most critical one of all for most businesses, email – the issues of security, availability, backup and full disaster recovery are outsourced to the experts and the SME gets on with running its business. That’s not to say you dispense with PCs – they will still have a strong place in many areas, from detailed individual analysis of data to creative writing, design, etc.

For large corporates, though, the issue is different. They have large IT teams. They have multiple locations, many servers and, generally, already have high-speed connections between them all. Therefore, ensuring adequate levels of security and availability while having a proper backup regimen and a full set of disaster recovery plans for each location, should be routine and already in place. For these organisations, Cloud Computing makes little sense – except, perhaps, for some specialist applications that are not available in another form.

And, of course, if all the world’s large corporates had all their corporate systems in a few locations, what a tempting terrorist target that would make – SPECTRE, of James Bond fame, would seem tame by comparison with the havoc that could be wrought in such a scenario.

So, to answer the question about whether “The Cloud” makes sense for business, my view is that for most SMEs, certainly. For large corporates, probably not. What do you think?

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