broadstuff

So, next week Carol Bartz will be removing the peanut butter jar at Yahoo. About a year ago we wrote (in response to one of Umair Haque's posts) that we thought the DNA could be mixed up, so long as the peanut gallery was removed, based on experience of corporate turnaround work we've done:

Now, Umair Haque reckons its all in the DNA, and thus they are doomed already - Kismet quick!

Is he right, or can they mount a transformation - a soup to peanuts re-engineering of the business, to maximise their assets, as GigaOm suggests?

History teaches that companies can and do come back from the brown stuff - in fact there is a strong element of cyclicality in many companies and industries. However, the "coming back from the brink" usually requires some fairly major housekeeping - some throwing out of baggage, bathwater and a few babies as well.

But it is a sad fact that the people who get companies into these states of affairs are too often the ones with the reins in hand when it comes to sorting it out, and if there is one lesson to take about companies in trouble its that senior management will fire legions of innocents before the market finally fires them in turn.

So, instead of laying off 1,400 people at $70k a year, how about cutting to the chase and laying off c 70 people at $1.4m a year first (OK, the number reversal is for effect, but you get my drift) - since there is so little synergy, shoot all those who were supposed to enable it first.

Net net, if Hurricane Carol can shift the peanut butter conspiracy, then it has a good chance of working out.

(The peanut butter is a reference to a memo a former Yahoo exec made about the difficulty of getting things done being like trying to move in Peanut Butter)

The L A Times pointed to something I also noticed today when I set up a friend's account:

Some high-profile Twitter accounts have been seeing astronomical jumps in the number of users subscribing to their profile updates -- tens of thousands of new followers, in some cases.

A feature launched last month, called "suggested users," contributed to the spike, explained Evan Williams, Twitter's co-founder and chief executive.

As part of the sign-up process, new users are now shown a sort-of featured personalities list that includes a wide variety of popular people and companies. Included are U.K. newspaper The Guardian's technology page, Web personality Felicia Day, TechCrunch, actor Rainn Wilson, computer maker Dell, grocer Whole Foods, the New York Times and CNN.

Since Twitter began endorsing a handful of personalities in mid-January, The Guardian was among several entities to reap a subscriber windfall. Its account jumped from about 4,000 followers to 66,000 in about a month, according to stat-tracking service Twitter Counter. And within the last two weeks, @GuardianTech added new users at a pace about 300% faster than the previous two weeks.

My first thought when I saw the very limited set of suggested follows was "I wonder how they decide who goes in there?" - it is prime value real estate. My second was "I wonder if those people are paying for presence?" and my third was "if they aren't, they could be - Twitter could make money out of this!"

The other thought was that it was a pretty scattergun, with a few questions added you could show a more relevant group of people.

We noted 18 months ago that the usage of social media was not just by The Yoof, and echoed Rory Ogilvy's bemusement that all the marketeering was aimed at the young, of whom there are fewer with less money, than on the baby boomers who are both numerous (and until recently, anyway) wealthy. News comes that the Leaders of The Social Revolution have finally sussed out where their followers really are, as the NYT notes:

A recent report from Forrester Research indicates that while it might be tempting to categorize all aging Americans as techno-dinosaurs and Luddites, more than 60 percent of baby boomers are avid consumers of social media like blogs, forums, podcasts and online videos. That’s up from roughly 40 percent a year ago.

“Traditionally, marketers have had difficulty targeting online communities where boomers are,” said Jeremiah K. Owyang, author of the report and a senior analyst with Forrester Research. But rather than shy away from targeting older consumers on the Internet as a whole, Mr. Owyang said, marketers eager to draw the eyes and dollars of baby boomers should direct more of their efforts to sites like AARP Online and social networks like Classmates Online, Facebook and LinkedIn.

You have to recall that Forrester were the same bunch who praised Facebook's 100 Year New Media Revolution to the hilt and invented the short lived Beacon Fan-sumer*, but nice to see the penny's finally dropped

* and who roundly castigated us for calling them on it at the time. To be fair, Jeremiah Owyang was only recently on their bus at the time and in my view has had a big impact on bringing 'em up to speed. You go, Jeremiah!

Following on from the last post on Twitter social graphing....Pew Research put out a report last week on behaviours on the Social Network du Jour:

In the past three years, developments in social networking and internet applications have begun providing internet users with more opportunities for sharing short updates about themselves, their lives, and their whereabouts online. Users may post messages about their status, their moods, their location and other tidbits on social networks and blogging sites, or on applications for sending out short messages to networks of friends like Twitter, Yammer and others.

As of December 2008, 11% of online American adults said they used a service like Twitter or another service that allowed them to share updates about themselves or to see the updates of others.

Twitter and similar services have been most avidly embraced by young adults. Nearly one in five (19%) online adults ages 18 and 24 have ever used Twitter and its ilk, as have 20% of online adults 25 to 34. Use of these services drops off steadily after age 35 with 10% of 35 to 44 year olds and 5% of 45 to 54 year olds using Twitter. The decline is even more stark among older internet users; 4% of 55-64 year olds and 2% of those 65 and older use Twitter.

And as we noted in the last post, there is always someone watching them. Or at least there will be, looking at the antics of Facebook recently its clear that digital surveillance-to-sell will be a big part of the 2009 SocNet bizmodel, given that Adspend is falling off.....

A number of clever people have written systems to derive Twitter social graphs:

There is this one:

Bernardo Huberman, Daniel Romero and Fang Wu of Hewlett-Packard Laboratories and Cornell University analyzed the data of 309,740 Twitter users.

Their sample showed that Twitterers in their data set averaged 255 posts, 85 followers and followed 80 users. They also found that a quarter of all posts are directed to another user with an “@” reply. Users who received more attention from followers were also more likely to post more often than users who received little attention in terms of followers.

At left, all links are declared “followees,” and the red links are actual friends. At right, after removing the black links and reorganizing, the network looks simpler than before.

But what they were really interested in was the idea of how Twitter users interacted with each other as “friends.” Consistent with behavior on social-networking sites like Facebook and MySpace, Twitter users interact with a small number of friends compared with the total number of friends and followers declared.

And then there is this too from Mat Morrisson:

Using nothing more than their public twitter relationships, is it possible to predict whether a US Congressperson is a Republican or a Democrat? The answer seems to be a guarded “yes” — our tools predict correctly 40/46 times (or around 87% of the cases.)

This post follows on from a post earlier today in which I asked, “can we calculate party affiliation?” The data set in the earlier post was gathered from the 16 members of the UK parliament who are on Twitter and the relationships between them.

Tweetcongress maintains a list of US congresspeople on Twitter. Today (February 13, 2009) there are 76 congresspeople on the service, but when I collected my data set of “who follows who” on February 3, 2009 there were only 65. Of these 65, fully 19 (29%) lived a life of noble isolation with regards the network — none of their peers linked to them, and they in turn linked to none of their peers. Removing these Miss Havishams from the data set leaves me with 46 twittering congresspeople who form a network.

Now as both social network analysis and Aesop would have it, “a man is known by the company he keeps.” What I mean by this is that given the partisan nature of politics, we should expect that Democrats will link to other Democrat twitterers more often than they link to Republican twitterers and vice versa. So that’s what NetDraw , the software I’m using for most of this stuff, looks for, or more accurately:

It is very interesting what you can see from people's interactions on social network...and very worrying, as the inferred deductions you can make from the visible electronic footprints are quite revealing. Up till now its been mainly the property of the Social Nets themselves (and the Apps providers for eg on Facebook's platform), but Twitter with its open APIS makes it far more discernable.

Story in the Torygraph today on finding Atlantis on Google Earth:

The network of criss-cross lines is 620 miles off the coast of north west Africa near the Canary Islands on the floor of the Atlantic Ocean.

The perfect rectangle – which is around the size of Wales – was noticed on the search giant's underwater exploration tool by an aeronautical engineer who claims it looks like an "aerial map" of a city.

The underwater image can be found at the co-ordinates 31 15'15.53N 24 15'30.53W.

Last night Atlantis experts said that the unexplained grid is located at one of the possible sites of the legendary island, which was described by the ancient Greek philosopher Plato.

According to his account, the city sank beneath the ocean after its residents made a failed effort to conquer Athens around 9000 BC.

A hoax? Surely not, who would be so unseemly in this most perfect of digital worlds ...... questions are:

- why the pattern looks like a city grid but is the size of Wales.
- positioning is certainly suspiciously auspicious

One assumes satellite images of this would have been around for some time, so interesting that its not been spotted before or is it just another Conspiracy to Keep The Truth From Us

One of the things that worried me about The Crunch was the fairly mealy mouthed coverage mainstream media gave of bank silliness in the years leading up to it. I'm no economist, but you know that giving "self certification" and "125%" mortgages to people is the top end of a bubble - as it was the last time in the late 1980's. Likewise the huge lendings in the old Soviet republics looked exactly like the Asian crisis in the 1990's and the Latin American one beforehand.

This stuff was not hard to see coming. Timing was a bit harder (I thought end 2006, turns out it was mid 2007 though the real info only came out mid 2008 - which is odd as many leading indicators were flashing red)

But, I have been following the Sir Allen Stanford story for a few months (He's a Madoff--Lite - a mere $8bn alleged fraud) simply because of the cricket connection - and its worth noting that the blogosphere had picked it up on him some time ago, whereas the MSM stayed shtum.

Now I understand the reasons - not having evidence, allegations can get you sued etc etc - but the point remains that the MSM was visibly behind the pace here.

As it was on The Crunch - and I am told by quite a few little birds that there, issues had less to do with journalistic integrity and a lot more to do with a combo of papers not wanting to lose Ad revenue, and frankly being seduced by the bankers's stories (and the bankers ....).

The key point is this - the MSM largely failed in its coverage of the biggest story of the decade, and is provably failing still. The blogosphere, with all its failings, is getting the story out.

If the point of "serious" news is to get to the truth, it didn't do - so its effectively, systemically broken one could argue.

So, I'm beginning to think that the malaise of Print Journalism is deeper than just the short term cr*p economics of the industry - its a deeper malaise, in that it is simply not doing its job. Thats why people are walking away.

So the solution may not be the issue around classifieds, or dis-aggregation of lifestyle sections, or whatever - it may simply be to have the balls to tell the people the truth.

Update - as Sarah Lacy notes, the trick to find out what is going on is just to follow what the smart players are doing - and then tell us.

Update - really good comment from Terence Eden pointing out that the blogosphere has at any point such a wide range of opinions that a few people are bound to be right - so how do you sort out the wheat from the other chaff? I suppose it comes down to blogs you think you can trust. In the Stanford case it was Alex Dalmady who picked it up originally, I must admit I didn't see it until a friend told me about while I was at TED, but said friend knows his stuff in this game.

Umair Haque always writes thought provoking stuff - whether you agree with him or not, it makes interesting reading. He was one of the kindred spirits calling the Crunch a while before it happened, and his recent post on the US response to it is interesting:

The real problem isn't stimulus, it's responsiveness. We're trapped in a zombieconomy: one full of brain-dead organizations who are about as intelligently responsive as Homer Simpson.

Want better clothes? Don't ask the Gap. Want better software? Don't ask Microsoft. Want better cars? Don't ask Detroit. Want better music? Don't ask record labels. Want better healthcare? Don't ask big pharma. Want to hold on to your money? Don't ask a banker. Welcome to economic Bizarro World.

The economy has gone catatonic. Unresponsive corporations are just the tip of the iceberg. Markets can't allocate. Investors won't invest. Banks can't value, or hold onto anything of value. People don't trust, much less consume. What's going on? The real problem isn't how or what we stimulate - but that almost none of our organizations could respond in the first place.

I think the Gap is probably wrongly called (they are one of the few places in the UK making clothes for tall women, for example), but his point is well made - by and large the structures that have grown up in the post-war era to supply us with what we need just don't seem to be fit for purpose now. Drug companies focus on the diseases of the rich, US car companies on machines optimised to waste resources, and as for bankers - well, they are just - lets just say there is an onanistic flavour in Umair's post's heading - Seed Your Own Stimulus - that rhymes

Umair's argument is essentially that the Stimulus won't work, because shovelling money into structures that aren't working is a waste.....the Smithian Invisible hand has died, we now have the dead hand of Zombienomics.

Today's organizations need the opposite of a stimulus: a responsiveness upgrade. A 21st century stimulus isn't about stimulating - it's about responsiveness. We need a new kind of stimulus today: an institutional stimulus - not just a financial one. The point of an institutional stimulus is to make our lame, brain-dead, zombified organizations more responsive.

It's 2009: Gap, Detroit, Microsoft, big pharma, record labels, evil corporations of the world - hello? Anyone home?

Money, value, and wealth are an outcome of having responsive organizations in the first place. We can stimulate trade from here until Doomsday - but without more responsive organizations, today's failure to create new industries and renew old ones will simply recur at an accelerating pace.

Yesterday, the Manhattan Project renewed America's technological base. Today, we need a Manhattan Project to renew our institutional fabric - because yesterday's rules and principles are limiting responsiveness.

He is arguing for structural change in a number of areas:

Are you redefining the economics of ownership? Ownership has its own costs and benefits. Here's an example of costly ownership: companies building patent thickets purely for the purposes of deterring competition. Here's a better one: the media industry eviscerating itself through brain-dead "rights management". Who can develop better kinds of ownership that create value for everyone? Advantage will flow inexorably to those economies - and companies - who can.

Are you redefining the economics of contracts and standards? How do we know today's contracts are inefficient? The sheer size and growth of the legal industry is an existence proof that contracting is becoming more and more costly. Ever read an absurdly heavy-handed Microsoftian shrinkwrap license? Of course not - and that's exactly why contracting today is often costly, cumbersome, and inefficient. Whoever can invent better kinds of contracts for the 21st century will realize a tremendous advantage. (Facebook need not apply...)

Are you redefining the economics of governance? Today, governance of economic organizations has devolved to cronyism, back-slapping, and glad-handing [Only today? - Ed]. Boards are happy to look the other way when CEOs line their pockets. CEOs are happy to look the other way when board members invite their bffs to join the board. Toxic governance has poisoned industries as disparate as autos, pharma, apparel, finance, and housing. New rules for the structure, composition, roles, and tasks of senior managers and boards will redefine the economics of governance. Advantage depends on doing so - when we can reinvent more efficient ways to manage managers, new value is created: just ask any open-source community, where everyone's simultaneously a worker, manager, and de facto board member.

Are you redefining the economics of management? Today's financial crisis isn't about money: it's about management. Bankers mismanaged our money catastrophically - because they were too busy managing their bonuses. Advantage will flow unstoppably to those who can redefine the economics of management - for the simple reason that, unlike bankers, they will be able to create greater amounts of more durable, lasting value. Responsibility, accountability, and transparency aren't just buzzwords - they're the keys to radically altering the costs and benefits of management.

Its a good start, but the issue is how will we execute? If anything, the forces still in the saddle are charging the other way. We see Nathan Myhrvold and others building businesses aggregating patents to create enclosed thickets of patents, legal systems where the cost of taking on any well funded entity (typically the owners of the Gordian Contracts) is prohibitive, the bailouts using public money are of the selfsame people who got us into this cr*p (this infuriates me - in any commercial takeover of failing businesses the first thing you do is fire the people who were in situ), and public money is used to prop the banking bozos up and carry on paying them undeserved bonuses.

On current evidence, the stimulus will just bloat the current Zombienomic structures because they, so far, are the main recipients of the money. The only way things can change is if the stimulus goes to the people and they then choose where to dispose of it. The risk of this is that The People by and large will spend it on today's frivolities rather than on long term benefits, and even if they were to radically change their spots, the only large scale structures around to take the money are those Zombie ones unless new ones are identified.

The good news is that We The People have the power to make big changes, because quite simply we can - via public pressure - turn these things around (I was heartened at the UK Governments recent rapid re-focus on bankers' bonuses when it became clear the populace were not willing to hand over their cash to pay for them - till then it almost seemed as if there was a clubby closing of the pinstriped ranks ).

The challenge we now have is how to do this - its probbly necessary to set up viable alternatives for people to argue for - non Zombie institutions. In the specific areas Umair mentions, here are some thoughts:

Patents - The US system is broken, though it looks like recent moves are going in the right direction - needs Federal acceleration. I've long argued for a "use it or lose it" clause, also making patent holding massively taxable for entities not actually in an industry (thus you can be a patent troll, you just have to pay huge taxes annually to hold the patents). For rights, we need to roll back to before the "Sonny Bono Infinite Life" clause and take it back to the 15 or so years protection it originally gave.

Contracts - The movement for plain english in contracts is a good start, and I'm quite impressed with various organisations that do standard contract templates, and courts are increasingly moving against unfair terms (like non-competes in employment contracts for example) and contracts that the reasonable ordinary person wouldn't understand. The main problems with contracts today are:

- that they are meaningless if you can't afford to take a defaulter to court (survival of the richest)
- they are useless if they are not clear (and the longer they are, the less clear they are)

There was a movement a few years back that argued that if you couldn't write any contract in 10 A4 pages of Font 10 text, it was probably not understandable and definitely not worth signing - maybe put that into legislation?

Governance - For a starters, basic M&A practice - if you take over a failing concern, you sack the incumbents under the not unreasonable assumption that they are incompetent. To f*ck up at this level in my opinion means a concerted effort to chuck a lot of them in prison (hell, I'd pay good money for that rather than their bonuses), that should start to modify behaviour of les autres. I also think ther is avery good argument for going after the bonuses paid over the last few years, as they were clearly based on fraudulent behaviour in many cases. Other simple laws like limits to number and time on board memberships, as Umair notes, will probably be required. A thought is that maybe bailout money should be targeted towards entities that have mutual ownership?

Management Economics - The problem is always aligning rewards to longer term performance - options were once seen as a way to do this (when they vested after 4 years) but somehow board remuneration committees always seem to allow management to feather their own nests post haste, no doubt for a small consideration (thank you, sir..No, thank YOU sir), and institutional shareholders never bleated so long as the bacon was delivered. The only opponents were usually small shareholders who had no voice anyway. Personally, I think a good play would be to limit the differential between lowest and highest paid in a company to say 30x, so its impossible for the unholy trinity above to ratchet rewards into the stratosphere without it trickling down. The key is to get the an enterprise's owners reconnected with its governance - another argument for mutual ownership?

But big picture, the real call to arms is for The People to wake up and make it clear where, and how, they want their money spent - if they don't, it won't just be the Dead hand of Zombienomics that allocates it, but the live hand of Porkonomics. And the tools will have to be User Generated, as frankly the Mainstream Media's performance over the last few years in calling these people to account has been woeful (unsurprising, as that is by and large one pillar of the interconnected Zombieconomy).

I've been so entertained by the Facebook Furore that the Twestival Tremors on the Grauniad and Torygraph passed me unnoticed till I read Kerry Gaffney's report.

In short, Twestival was primarily organised by London PR peeps to raise money for safe drinking water in the developing world, in essence by making Londoners pay to drink unsafe beer and wine and eat dodgy burgers* under the falling railway arches in Olde East Lunnun alleys. This formula seemed so popular that it was reproduced in 175 cities worldwide, and a shedload of money ($250,000) was raised, with more to be counted.

This was all reported in the Grauniad and Torygraph by their Social Meedja journos, and then the fun started - the comments sections are hilarious, especially the ones by the more pious Twitterphiles and Twitterphobes who probably didn't grok that half the comments on both sides were taking the proverbial p*ss.

I can kinda see a few of the 'phobes points - twentysomethings bleating on about the awesome (I mean Aaawesum) existentialism of meeting people in the flesh that you only knew online is hardly new news if you've been on the 'Net awhile. Ditto listening to those who want to change the world, mainly by swilling it down their gullets at Son-of-First-Tuesday socials. And besides, it must kinda grate to see all those bright young things (and some not so young by the way) having a great time and doing good to boot when you weren't there

Ditto, the more sanguine 'philes are scratching their heads and wondering why people would whinge about something they've by and large never tried (PR, I mean - not Twitter ). The less sanguine ones are still trying to explain it to them.....

But ultimately, my comment to the naysayers is this - which of you lot is going to get off your arses and raise the same amount of money? And more important, are your arses as cute as theirs?

* That must've been the bitterest IPA I've ever had - made Czech lager taste like coca-cola

Both our websites are written using Drupal, of course! From techPresident.com (hat tip Ars Tech):

Drupal developers are abuzz with the realization that the White House's new Recovery.gov site was built using the free and open-source content management platform Drupal. Pre-Recovery.gov, the perhaps highest-profile use of Drupal had been the Onion website. But that's not the only reason that Drupal fans are excited. I asked two CMS expert friends to help me understand the situation, and here are a few of the reasons they gave for why the White House's embrace of Drupal is momentous:

First off is the very fact that with the move the White House is offering an alternative to DC's long love-fest with proprietary technology. Drupal is free, and hey, the economy being what it is, there are tax-payer dollars to be saved on going open source.

Second, it shows that the White House isn't putting much stock in the argument that collaboratively-built software isn't stable or secure enough for government use. (Though one could make the argument that Recovery.gov isn't exactly mission critical.)

Third, Drupal is, arguably, progressive. It has relatively deep roots in Democratic politics, first getting attention in the political space as the foundation under Dean Space. Whatever state Drupal is in today is a result of the community of developers who cared enough to nurture it -- the underlying message, of which, of course, echoes Obama's political narrative. ([UPDATE] David Cohn's written a history of Drupal's political past.)

And of course they join the legions of smart companies using it successfully.