New Florence. New Renaissance.

Next Book – Excerpt – Chapter 2 Case study: HP – the quest for a “10 out of 10” supply chain

Each chapter in my next book, The New Technology Elite, has a case study or a guest column. The text is going through the publisher’s edits and subject to change. Here are some excerpts from the HP case study in Chapter 2.

This was written before the new CEO Meg Whitman announced HP was not divesting the PSG division. She cited its efficient supply chain described below as one of the reasons to keep the unit

“It could be your darkest hour or your finest” says Tony Prophet as he discusses the impact of the Iceland volcano explosion and the Japanese tsunami and other disruptions on HP’s supply chain. Prophet, a senior vice president, oversees hardware purchasing and logistics for HP.

It is a massive operation – the largest in the technology industry with over $ 60 billion in components, warehouse, transportation and other logistics costs. The HP machine churns out two personal computers a second, two printers a second, and a data center server every 15 seconds. It is also a constantly evolving operation - with a changing mix of company owned factories and contract manufacturing and air/ship/rail logistics from/to most countries around the world. So those challenging “hours” Prophet talks about come with alarming regularity.

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One of those defining hours Prophet talks about was after the Eyjafjallajokull volcano explosion in Iceland in April 2010. That ended up disrupting flights to Northern European airports for weeks. HP flies many of its products from Shanghai, China to those airports. On many days, HP is the biggest single buyer of outbound airfreight from Shanghai. Fully loaded 747-400 cargo planes with HP notebooks and other products often take off 3 times a day from that airport.

Prophet’s team immediately decided to switch shipments to northern airports like Frankfurt, Germany to southern airports like Barcelona, Spain and Naples, Italy. Except that they could not find sufficient commercial flights for those destinations from China. So, they booked charter flights. Even as HP products were arriving in Europe, competitors found charter freight prices had gone up 50% or were not available any more. HP’s 72 hour lead turned out to be significant.

In March 2011, Prophet was woken up at 3.30 am to be informed about the massive Japanese earthquake and tsunami.

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If those short term maneuvers are dazzling to watch, even more impressive are the long term shifts Prophet talks about.

“One of our on-going projects has been to streamline our supply chain especially after major acquisitions like Compaq or Palm or 3Com.”

The HP-Compaq merger, a particularly large one, afforded plenty of streamlining opportunities over the last several years. “In 2006, we had a combination of 70 (HP and Compaq) supply chain nodes worldwide, most company-owned and in relatively high-cost locations. Also, most were geared to making desktop PCs and the notebook market was taking off”

As Prophet told a meeting of financial analysts in December 2010

“Each of those nodes had inbound hubs, outbound hubs, unique IT connections, and drove a tremendous amount of overhead to support the complexity of these nodes”

but it has been streamlined to

“About 30 nodes and significantly fewer of them company owned. Obviously biased more towards lower-cost locations, but not exclusively. We continue to operate a plant in Indianapolis. We continue to have a plant in Japan, so where it makes sense for proximity to the customers, to serve those customers with high velocity, we're there”

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Across the whole business, HP had more than 1,000 processes and 300 IT applications. “So our objective is to cut the processes by an order of magnitude and cut the IT applications by more than a third. We're moving to common IT applications to drive those processes, and so that to our suppliers and to our customers we look like one company.”

“We've got a path, a strategy charted to build what we think will be a “10 out of 10” supply chain, and we're about a year into this transformation.”

You cannot serialize these projects. They all have to march forward in parallel and they all have to adjust to the short term hiccups, and shifts in the market as the recent market move in many Western markets to tablets away from notebooks.

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Prophet in that presentation to analysts highlighted some of HP’s global reach.

“First multinational to manufacture PCs in Russia.”

“Upgraded our operations in north central India”

“Significantly upgraded our operations in Brazil”

“We believe we'll be the first multinational manufacturing PCs in Turkey. That'll allow us to effectively serve central Asia, Eastern Europe and the Middle East, the Mediterranean region particularly.”

But particularly impressive is the HP pioneering expansion into Western China.

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If you a draw a circle out 750 miles from Chongqing, you are looking at about 300 million people – which by itself makes it one of the largest PC and other gadget markets in the world. So that is our first focus here in the West of the country – made in China, for China”

Indeed the Chongqing plant has already produced for the domestic market what is being called a “rural” laptop – designed to handle intense heat and rain, and is also seeing demand in other regional countries.

Even more impressive is the infrastructure the Chinese are building around Chongqing. There is the high-speed freight rail line to the port-city of Shenzhen. The route run by a contractor, Cosco takes 53 hours and is expected to go down even more over time, and emphasizes “five fixed” services - fixed stops, fixed trains, fixed timetables, fixed routes and fixed rates. Shenzhen is well equipped to handle bulk shipping to most major destination markets.

Next particularly encouraged by HP, the airport at Chongqing was extended by 400 meters in a rapid construction project to allow fully laden 747s (with merchandise and extra fuel) to fly nonstop to Europe.

But probably the most exciting development is that of the next “Orient Express” – a rail service between Chongqing and Duisburg, Germany covering nearly 7,000 miles in 13 days. That is 26 days quicker than the current rail-sea combination, and considerably cheaper than the air option. And it should get even quicker as China shares its growing high-speed rail experience with countries along the path - Kazakhstan, Russia and Poland.

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Photo Credi: HP. Students in Chongqing , China watch video on the HP Mobile Experience bus.

Technology tips for trick and treaters

Tips from AT&T

1. Go mobile and ensure accessibility: Make sure wireless phones are fully charged. Since costumes and carrying bags of candy can become cumbersome, consider using a belt clip or other accessory that keeps the phone within easy reach.

2. Secure the line of communication: Pre-program contact information of parents, neighbors and emergency services into your and your child’s speed dial, and be sure you know how to access these numbers with ease.

3. Establish boundaries: Families should have in place a familiarized route for children to follow while out on the town. Mobile navigation tools can assist parents and kids in creating routes, and goblins on the go can reference maps throughout the evening. Similarly, AT&T’s FamilyMap Viewer allows parents to easily and immediately locate a family member's whereabouts from their mobile device or PC so they can keep a close watch.

4. Be in touch: Set up periodic alarms with Halloween-themed tones as a reminder for trick-or-treaters to text or call home between candy collecting stops.

5. Don’t miss a thing: Phones also come with photo, video and audio recorders, allowing spur-of-the-moment happenings to be captured and shared among friends and family in real time. AT&T’s Video Share allows you to see live video on your handset while a voice call is taking place.

6. Drive safely: With pedestrians filling streets and sidewalks, it is more important than ever for drivers to stay alert behind the wheel. If a call needs to be made or a message checked, pull over. Don’t text and drive. Check out AT&T DriveMode mobile application – it automatically sends a customizable reply to incoming texts – notifying the sender that the user is driving and unable to respond.

Photo Credit for Halloween avatars

Dennis Howlett’s Kitchen Upgrade

My colleague Dennis Howlett recently upgraded the kitchen at home in Spain. I invited him to write about some of the new technology the kitchen now boasts:

“We recently remodeled our kitchen and in the time since we completed the last renovation the appliance technology has moved on in leaps and bounds. The last time I had the use of a dishwasher was around 1993. It was a Siemens and did a fantastic job. You never needed to know when the wash cycle had finished. It stopped grumbling and groaning. The Electrolux Energy Saver is almost silent. Twice I’ve opened it in mid cycle, ending up sprayed with hot water. That was until Judith showed me the red light shining on the floor: “That’s to tell you it’s working. It will go green when it is finished.” Sheesh !!

We didn’t want a conventional extractor/hood because it would have taken up space, required ducting and spoiled the clean lines we were trying to achieve. Instead we opted for a Faber F-Light. This amazing device doubles up as a remote controlled light fitting and multi-speed extractor. I could play with the rise and fall mechanism for hours.

We’ve been through a good few conventional fan ovens but on this occasion settled for a De Dietrich DOP895B. This has 16 intelligent cooking settings. Tell it when you want the food ready, tell it the weight of whatever you are cooking and it does the rest. The first time out I tried making two Victoria Sponge cakes. This is always a challenge because the cakes have a tendency to rise unevenly. This time out the results were near perfect, just requiring a few extra minutes to get the texture we wanted.

For the hob I would have liked the Die Ditrich ‘Piano’ which introduces the concept of ‘zoneless’ induction cooking. Place a pan anywhere on the hob, the device recognizes its size. Punch in the desired temperature setting and it starts heating the pan using the induction method. Move the pan to another part of the hob and it understands what you are doing. Sadly it was a bit too costly and larger than we need. We opted for a different model that has many of the same features as the zoneless model. I like that when you take a pan off the ‘ring’ the appliance immediately shuts down that area and shows you if it is still hot. That’s a safety feature well worth having.

The microwave is a fairly standard Whirlpool device with one exception. Dial in the weight of something that needs defrosting and it does the rest, beeping if you need to turn the food. We’ve used it a few times and it does an amazing job, turning a block of frozen ground beef into usable crumble within 3 minutes.

As for the fridge. It’s another De Dietrich appliance only this one is a large larder fridge. Living in Spain we need a large fridge but the feature which sold it to Judith is the fact it only needs cleaning twice a year. How they do that is a mystery but then that speaks to the advance made in kitchen appliance technology.

The story would be incomplete if I didn’t mention the Schmidt units. Schmidt have been around more than 50 years. That was a key issue for us because kitchen makers tend to come and go. Their designs turn kitchen units into furniture that works really well in designs where you have an open kitchen diner floor plan. It’s impossible to slam a door because they use gas filled struts that pull the door shut at controlled speed. You can almost never have enough electric points but they break up the surface appearance. Schmidt incorporated a rising bank of sockets that disappear into the granite work surface when you’re finished. What amazed me is that they managed to provide us with more space with less unit structures than we had previously. Or at least that’s the effect. The store which sold us the kitchen did an amazing customer service job. There are always issues when fitting a kitchen and especially in an old house where none of the walls run true. They responded to all emails within six hours and kept the work flowing. Nothing was too much trouble. And now the job is complete, they will make a final inspection to ensure everything is as it should be. I’ll make the final payment while they are here and with pleasure.

I feel as though we have something that is not only aesthetically pleasing, but incorporates great design that carefully blends with function through technology. It saves time and makes the cooking process a pleasure. Was it expensive to complete? Yes. But since we spend a lot of time cooking it makes sense to invest for the things that give pleasure. Back to the hob !!”

 

 

Walt Isaacson’s Steve Jobs

Robert de Niro notwithstanding, if Puzo and Coppola had made the younger Don Corleone as the first Godfather movie rather than the second would it have worked? And if they had not fleshed out characters like Fredo and Clemenza would Brando’s character been so riveting?

I asked these questions as I read Isaacson’s biography of Steve Jobs. Stylistically, I would have loved for him to have the started the book around 2000 and spent 3/4 of the book on the amazing string of Apple and Pixar achievements since then, and SJ’s own just as amazing willpower and strength through all the medical procedures he endured, and woven in as appropriate snippets from SJ’s previous history. But Walt presents a chronology from birth so the first half of the 600+ pages is somewhat plodding and repetitive. Plenty of references to vegan diets, body odor, drugs, piercing glances and “reality distortion” fields.  And it leaves him much less space to flesh out so many interesting people and incidents around SJ. I would love to have seen more on Laurene Powell, Tim Cook, Apple’s retail stores, its Apps ecosystem. Did SJ ever worry about AT&T’s network problems with the iPhone? What did he think of Foxconn and its employee suicides and other labor issues as it assembled most of his iPods, iPhones and iPads?

My nitpicking aside, the book has plenty of humorous moments – you have to laugh at SJ’s audacity in many of his dealings the book documents. Larry Ellison talks about the torture of being a guinea pig of SJ’s perfectionism – as he showed him various pre-production versions of Pixar’s Toy Story and later endure multiple weekend trips to the warehouse which was a mockup of Apple’s retail foray. SJ’s wedding cake, describes Walt, “was strictly vegan – devoid of eggs, milk, or any refined products – more than a few guests found it inedible”

And there are plenty of tender moments.

One of my favorites is when Walt asks him if he often thought of being put up for adoption.

“These days, he said, he thought more about getting older than about his birth. That led him to play Joni Mitchell’s (on his iPad) greatest song “Both Sides Now” with its lyrics about being older and wiser”.

I wanted to read the book as soon as it came out to see if I needed to change much in my next book’s manuscript in sections about Apple. Since he focuses more on the man, and my book more on its operations, the answer is no. But I may need to change to change the Corning case study in the book. Presumably, because of an NDA with Apple they would not acknowledge if the iPhone used their Gorilla Glass. Walt spends two, again humorous pages, describing how the deal between SJ and Corning’s CEO, Wendell Weeks got done.

The book will shock you, touch you, entertain you. Get a copy. But when the movie is made about SJ, I hope they start with the later life – the Brando version if you will.

Cross-posted on the Deal Architect blog

The Android Barometer

Dan Morrill of Google explains the new feature/sensor supported by Android

“The primary purpose of the barometer is (at least, I've been told) to make GPS lockons faster. Locking on to a GPS involves numerically solving a 4-dimensional set of linear equations -- 3 dimensions in space, and time. (Yes, you get accurate time for free if you lock on to GPS.) Because of the way GPS works, this can take a few minutes.

This goes much faster if you already have an estimate of your location. This is why "aGPS" (assisted GPS) services are so popular: by starting with a rough city-level coordinate fix through something like cell-tower network location, you can reduce the amount of math you have to do to lock on. This is where the barometer comes in.

The 3 dimensions in space are latitude, longitude... and altitude. The barometer gives you a reasonable first-cut estimate for altitude. This gives you a bit of a leg up on one of the dimensions -- especially combined with "2D" aGPS -- which can help speed up lock-on in general.

Now of course, the barometer can also be used for things like, well, determining atmospheric pressure (although I'm not sure it's really weather grade.) But the main reason it's in your phone is to help with GPS.’

Photo Credit of Samsung Galaxy Nexus which has the barometer

Popular Mechanics Breakthrough Awards 2011

“They are reinventing the wheel—or, rather, the cell tower and the internal combustion engine; reaching new heights in wind power and space exploration; and figuring out clever new ways to clean up and observe the environment. They’re even helping the paralyzed to regain use of their legs.”

Read more: 10 Brilliant Innovators - 2011 Breakthrough Award Winner - Popular Mechanics

Includes James Cameron with one of the 3D camera rigs he created to film Avatar. The director plans to take a version of the rig on a dive to Challenger Deep—36,000 feet below the surface of the ocean—in a piloted submersible he also helped to engineer.

Next Book – Excerpt – Case Study 1 UPS: That’s technology amore…

Each chapter in my next book, The New Technology Elite, has a case study or a guest column. The text is going through the publisher’s edits and subject to change. Here are some excerpts from the UPS case study in Chapter 1.

"There will be no more stress, 'cause you've called UPS… THAT’S LOGISTICS."

In the Fall of 2010 UPS launched a global TV ad campaign around the Dean Martin classic "That's Amore," sung in Mandarin, Spanish and English. The lyrics went along with the theme of “We (Heart) Logistics” which replaced UPS’s previous theme of “What can Brown do for you?”

UPS is unabashedly proud of its “brown collar”, “box kicker, label licker”, “logistics is sexy” image. 2010 Revenues of almost $ 50 billion and a history of over a century justifies that pride.

But look under its zillions of bar coded labels, and you see a marvel of technology which keeps a massive data center in Mahwah, NJ and another outside Atlanta, GA humming. 12 mainframes rated at 52000 MIPS, nearly 16,000 servers, and 190,000 workstations are part of its technology landscape. UPS says its package tracking is done by one of the world’s largest DB2 site (the IBM database software). It stores over 10 petabytes of data, It is one of the largest user of mobile minutes in the world. UPS.com, available in 32 languages, handles 48 million tracking requests on a peak day during holiday season. Its technology helps optimize truck routes and famously minimize left turns. It is investing in a variety of fuel - efficient trucks and techniques, such as continuous descent approach, to glide its planes for fuel efficiency and noise reduction.

Scott Davis, the Chairman and CEO says “Often when I’m talking to investors I tell them that we’re about half a transportation company, half a technology company. “

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A delivery information acquisition device (DIAD) is what UPS’s truck drivers use to guide their delivery routes and more. The DIADs help UPS drivers in their brown trucks deliver over 22 million packages a day during the peak holiday season. It was introduced back in 1990, way before the iPhone or the iPad was even conceived of. Now in its fifth generation (in photo), it does many of the things those Apple devices do – and others they don’t. And its battery lasts all day - much longer than most Apple or Android devices.

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A UPS cargo airline pilot lines up with the runway much earlier — sometimes up to 40 miles away from landing — and cuts the thrust once and descends at a consistent rate.

“If the stepped landing is a flight of stairs, then the continuous descent approach is a wheelchair ramp. And since the planes aren’t constantly ramping up and pulling back on the engines, it’s a lot more efficient…..UPS pioneered the approach and found nitrogen oxide emissions dropped by 34 percent below 3,000 feet and engine noise fell by 30 percent within 15 miles of the airport. The planes also saved 250 to 465 pounds of fuel per flight.”

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CIO David Barnes (who happens to also be one of the most respected CIOs in the industry) who started his career at UPS as a part time loader over 30 years ago describes the then and now:

“If you were a pre-loader in the morning, it was a great college part-time job.  Get in there before class.  But you have to memorize the routes of three drivers.  A very painful process because if you misloaded that package and you put 101 Main St. behind something else, the driver had to loop back and that’s not very efficient….We’d done it one way for 90 plus years at the time.  We are very good at it - industry leading.  How could you do it dramatically different?  We threw out all the norms and developed a system called Package Flow Technology.  Just one small aspect of that program was to take a fresh look at how you optimize networks.  And as a result of optimization routines that we put within that software within the practices at UPS, we were able to reduce our mileage in a given year in the United States alone by 30 million miles - that’s about three million gallons of fuel. And perhaps more important to all of us it represents 32 million tons less of CO2.”

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CIO Barnes again:

“In the Atlanta (data center) we chill the cold water that runs through those chillers at night.  We have a 500 gallon tank buried beneath the data center.  We chill the water at night.  We get lower electricity rates at night and then we use that chilled water during the hot summer days to chill the plant down.  It’s very, very environmentally sensitive.  It reduces the demand for power generation at peak times during summer days. “

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(Scott Galloway) traded that career (in ERP software) for an investment in a UPS Store franchise. Store 4586 in Tampa, Florida he says, is “simplicity personified compared to the career in ERP.” Simplicity sounds like an oxymoron when you are also talking largest DB2 database in world. Few of the over 4,000 store operators in the US have a technology background like Galloway does. So, UPS strives to keep the processes and technologies simplified and standardized.

In 2001, UPS acquired the Mail Boxes Etc. franchise, rebranded it The UPS Store, and has steadily grown the volume of stores and the range of products in such stores. Besides the mainstay shipping, the stores offer copying and printing services, packaging supplies, mailboxes, notary services and plenty more. The shipping, of course, allows for a wide range of global destinations, multiple air, ground and other paths, zillions of rates, corporate discounts and taxes.

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What if UPS were not as the CEO described “half a transportation company, half a technology company”? Could it be a full fledged technology company?

Think of the DIADs going back to 1990 and its huge leverage with the mountain of mobile minutes it procures – UPS could have introduced an iPhone like device way ahead of Apple. Think of the green innovations – UPS could easily be a cleantech player. Think of the store software – UPS could easily be a software vendor to countless other industries which use franchise models. Think of the various verticals UPS has built niches in.

That’s idle thinking. UPS is clearly comfortable in its skin – as a dominant logistics provider – and where technology fits in that definition. As its new jingle goes

Where technology knows right where everything goes … THAT’S LOGISTICS….Bells will ring and ding and ding and ding… THAT’S LOGISTICS

Photo Credit: UPS

Visa’s Tier 4 Data Center

That event is one reason why the OCE was built to meet the Uptime Institute's definition of a "Tier 4" center, which means every major system--mainframes, air conditioners, batteries--has a backup. It's Visa's first such center and is strong enough to withstand California-style earthquakes and Midwestern-size super-tornadoes. For example: If power goes out, banks of batteries kick in, followed by diesel generators that also have backups. If a water main bursts, there's a 1.5-million-gallon water tank (if that runs dry, Visa dug three wells around the facility).

The only thing that might take down the OCE, it seems, is us. Transaction growth has averaged 7% to 17% annually. Visa expects the OCE to handle growth into the 2020s, but at some point, of course, something will give.

FastCompany

The “Fab Four” threaten every industry

Nice graphic from Fast Company

Why computer voices are mostly female

"The fuss over Siri's sex also raises a larger question: From voice-mail systems to GPS devices to Siri and beyond, why are so many computerized voices female?

One answer may lie in biology. Scientific studies have shown that people generally find women's voices more pleasing than men's."

"Another answer lies in history. According to some sources, the use of female voices in navigation devices dates back to World War II, when women's voices were employed in airplane cockpits because they stood out among the male pilots. And telephone operators have traditionally been female, making people accustomed to getting assistance from a disembodied woman's voice."

"Bajarin, the Silicon Valley analyst, believes that more computerized voices would be masculine if not for the associations with HAL, whose malicious intent in the 1968 Stanley Kubrick film was made even creepier by his soothing tone."

CNN