Don Thurston Blog

From Guttenberg to Bytes, Let Me Count the Ways

Guttenberg’s printing press inaugurated an era of dynamic changes in communications.  Up until this game altering brainchild, providing information via the written word was limited by labor, transportation and reading ability. Monks copied documents by hand, transmission was personal delivery, the citizenry largely without reading skills. Guttenberg’s creative passion erased these constraints.

Disrupting the status quo was met with vengeance by those with a great deal  to lose. In particular politicians took an active stance in suppressing the sudden availability of information that diminished their hold on the voters. Religious institutions were equal in their opposition to this technological interloper. Anti-printing press zealots were encouraged, resulting in a considerable amount of violence.

Time, non secular education institutes and readily available reading material greatly increased literacy rates…… no longer was reading ability limited to the few people of privilege. Within a relatively short period of time the written word was being widely consumed. An unintended consequence; censorship, and an enduring controversy.

A side bar—Guttenberg was cheated out of his patent ownership such that he did not benefit financially and suffered mightily emotionally.

Electrical impulses to transmit information through wires became the next great accomplishment. Samuel Morse receives much credit, in particular accolades for his contribution of the Morse code.  Volumes of information now moved through wires at the rate of an electric impulse.  Thousands of kilometers of surface and underwater cable united the world as never before. As telegraph poles marched across the North American landscapes, Indigenous peoples climbed to the top, anticipating over hearing the messages.  Pace of implementation was astounding. An example; a cable network connecting Indonesia to Europe was completed just in time to transmit news of the devastating Krakatoa volcano. Such real time information available to an uninformed population, caused great consternation, imagining a worldwide volcanic epidemic.

The telephone soon followed when Alexander Graham Bell upstaged the dot dash world with voice transmission. Once again adaption took on a world of its own. Suddenly everyone was talking to everyone else throughout the world.

What next?  Marconi’s ingenuity produced equipment to send sound waves, transmitted without wires. All the ships at sea could now be joined with the simple medium of dots and dashes.   Debate continues to this day as to the principal inventor. Suffice to say that both Marconi and Tesla were involved. Marconi remained a major player.

The wireless coded messages soon gave way to voice.  Many inventors contributed to what became the radio.  The results are evident today as wireless analog and digital communication maintains a substantial place in our daily listening and transmitting worlds. Outwardly little has changed; inside it is a whole new ball game. How many tubes have you replaced lately?

Soon real time video images swooped across the globe. Thomson’s cathode ray tube was the precursor for television; TV dinners became ubiquitous.

Two developments combined to initiate changes that dwarfed all previous communications systems.  One was the digital revolution as Brattain, Shockey and Bardeen came up with the transistor.  Secondly fiber optics replaced copper wire, multiplying many times transmission capacity. In part thank Karny and Hopkins for this. Vast amounts of   information now moves along glass cables at the speed of light. All of the devises, now so common, stem from converting an analog signal to digital and the capacity to move to move this stuff everywhere all the time. Think computers, smart phones, and so on and so on.

Over the centuries the absorption rate of new connecting technologies has been truly amazing. Seemingly we have no limit to exchanging information with everyone all the time. Why else would texters risk life and limb in cross walks and distracted driving laws are in place.

Throughout these few centuries one can imagine parental  discussions lamenting that all the younger generations seem to do is read,  expanding knowledge via crystal sets, enjoying  clandestine boy-girl phone calls, watch the Nature Channel and expanding relations with family and friends by texting.

Accolades for Guttenberg, Morse, Bell, Marconi, Thomson, Brattain, Shockey Bardeen and Karny, Jobe ; all contributed immensely to how peoples across the world can be in touch all the time.

Unintended consequences…. some information is offensive, some is deleterious, some is disruptive and some used for really rotten purposes.  Such outcomes are unsavory and harmful. Restricting messaging remains an issue, repeating earlier movements as far back as the Guttenberg era. Lest we forget, demigods of all stripes want and need to manage information for purposes of control and power.

Counsel from our inventors….. freedom to access information is a single force in growing democratic and civil societies.

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Don Thurston Blog

Pink Pills for Pale People

Executives of a large food store chain reviewed their over-the-counter pharmaceutical business. Results demonstrated a significant decline in revenue, much more obsolete inventory and, predictably, lower profits.

Ms. Let Them Eat Cake Antoinette, the Vice President of Marketing, chaired a conversation among company executives. She just returned from a personal inspection tour, and was surprised by the negative reaction to what she believes to be customer-friendly facilities. The almost fifty feet of seven levels of shelves provides ample space for medications, considering the small packages of about four centimeters across and seven centimeters tall.

The Manager of Packaging, Ms. Myopia Franklin was equally baffled by consumer resistance. While the packages are small, the labeling is adequate albeit with tiny print.  She holds government responsible because of multi-language requirements, detailed lists of ingredients, nutritional specifications and company liability denials.

Doctor Potter the Third is the Product Manager. He is the great grandson of an industry pioneer who made famous the slogan “Dr. Potter’s Pink Pills for Pale People” He is married to Fiona Placebo. The placebo family made a fortune in the sugar pills industry. Dr. Potter the Third allowed  that consumers may becoming wary of exaggerated claims of the curative power of some of their preparations. He maintains, however, that they make up a vital part of health care.

National office is represented by Mr. Our Design or None Carpenter  He is an interior design specialist. Convenience, ambiance, and product enhancement are his areas of expertise. While he observed some minor  problems, Our Design or None stated emphatically that store design is not the main cause of lower profits.

As a result of their deliberations, the following report was submitted to head office;

While the array of products is overwhelming, the consumer deserves choices to ensure effective treatment. Regarding product access difficulties, the problems are acknowledged, considering mobility issues of many customers. Soft floor covering is recommended along the shelves which will help relieve pain caused by kneeling when searching for a suitable medication. Assistance in crouching and getting up could be facilitated by monitors similar to the greeter program at Walmart. An imaginative solution to reading fine print could be the availability of magnifying glasses, along the lines of securing pens at bank counters.

A pilot study will be undertaken in a market where customers are most likely to have declining health, physical limitations, low level cognitive problems, diminishing eye sight and increasing skepticism.

A follow up report is forthcoming in six months.

 

 

Don Thurston Blog

CASP is Building a National Strategy

CASP (Canadian Association of Syrup Producers) is meeting this week to map out an international syrup campaign. Members include maple, corn and molasses producers. Their motivation for new directions comes from the need to gain greater access to international markets, formulating a leading-edge environmental strategy, shipping infrastructure, financing, joint ventures, long-term contracts, branding, food safety and intensifying an advocacy program.

CASP’s strategic role is enhancing the position of syrups as vital food items. The organization maintains that syrups general and maple syrup in particular are very important to Canada’s international stature and economy.  These tasty products are iconic and represent Canada well on the global stage. Further, the organization states that the syrups are nutritious and are produced in an environmentally-friendly manner by organizations that are socially responsible and inclusive in their employment practices. The industry embraces social enterprises as important components of their mandate.

Relations with Indigenous Communities have been tumultuous. Specifically, land usage was a source of contention, considering that much of the area occupied by the maple trees was for centuries the purview of the Indigenous Nations. A landmark agreement was reached seventy-five years ago which saw revenue-sharing solve the dispute.

New environmental regulations are forthcoming from the Federal Department of Sucrose and Carbohydrates. These will be comprehensive, and will influence all facets of the syrup industry.

CASP is evaluating the production process. First and foremost is avoiding any innuendo that the products are “dirty”. This often surfaces because of perceived harmful environmental impacts. In this case, all syrups are generated from renewable sources. Carbon dioxide is absorbed as trees, corn, sugar beets and sugar cane grow. However, when sugaring off, cane and corn stalk burning do produce toxic products of combustion, as well as carbon dioxide. Conservation measures include heat recovery and reuse. CAST’s research indicates that combined, the process is carbon neutral.

Transportation measures are under the microscope. There have been mishaps. Several years ago a tanker truck carrying molasses from a sugar refinery was in a collision spilling hot, sticky liquid over a wide stretch of highway. Powdered ginger was used to absorb the molasses, providing essential ingredients to make ginger bread. A pipeline moving maple syrup from a processing plant to a packaging plant ruptured, contaminating a field of wheat. A quick-thinking engineer promptly marshalled all the pancake producers in the area resulting in satisfactory remedial action. Transport by rail cars is being evaluated to determine the consequences of a runaway rail car.

Packaging specialists consider containers at production locations as the optimum solution. Research is ongoing.  The end game is a biodegradable material that will not vaporize in the pantry with nasty consequences.

A relatively new consumption barrier is surfacing. An obesity epidemic is threatening health. CASP is engaged in a branding program that will include sugar from syrups as good for you.

In conjunction with the Canadian Association of Liquefied Natural Gas Producers, CASP and CALNGP are presenting a united front in conversations with governments, environmental groups, Indigenous Peoples, consumers and regulatory bodies in efforts to find solutions to their common problems.

Syrup producers are searching the world for joint-venture partners who can commit to long-term supply contracts and participate in the project financing. Thus far, increasing international demand for Canada’s syrups has proven to be elusive. This will remain until Canada can assure importers of the capacity to be a reliable long-term supplier.

Work continues on all fronts.

Note to reader: The Faculty of Spoofology at the University of Thrush Williams has just awarded the author the prestigious Spoofer of the Year Award.

Don Thurston Blog

If not a pound of flesh, then what?

Shylock certainly raised the interest rate bar; in the event of default the borrower contracted to pay a pound of his flesh from a location chosen by Shylock. This money-lender has long been a synonym for the seedier side of debt transactions, including security and interest charges. Some cultures eschew interest charges altogether, while some have no qualms charging rates beyond the pale.

Debt and the associated costs have long been a part of the commercial world. Think of the issues over the centuries: debtor’s prison when default was punishable by incarceration; neither a borrower or lender be; if you default on a small debt, that is your problem, if you default on a large debt , that is the lender’s problem; it is amazing how fast later comes when you borrow to buy now; before borrowing from a friend, decide which you need most.

The most contentious issue surrounding lending is the cost of money levied on the borrower. Many criminal codes define what is deemed to be excessive as usurious. From a criminality point of view, little has been accomplished except wrangling. Terms and conditions are almost always complicated, contracts are very difficult to understand and enforcement absent only in extreme situations.

There is a social component to lending and attaching hefty costs. Vulnerability is the issue for some of those who need to finance . They are often ill equipped to deal with the consequences’. A lethal combination of a lack of understanding, a shortage of assets and no transparency will lead to unwise borrowing. Agencies rush in to take advantage, charging what many consider unserious rates. Nothing illegal but certainly onerous.

Recognizing that bridge financing is essential,  loans are now available at rates and conditions that beat the competition, give the borrower a fair and reasoned alternative, are totally transparent, are convenient and are profitable for the lender. Who in their right mind could find fault with this concept?

No doubt there is a much-needed service between conventional lending and that offered by agencies employing low security high cost strategies. Now two pioneering agencies have joined forces and created Cash Crunch. Look them up on the web at Momentum, Cash Crunch and First City Financial, Cash Crunch.

Shylock would be gobsmacked and out of business.

Don Thurston Blog

If you have fresh water supply problems and no water department, who do you call?

“Would you tell me please which way I should go from here?” asked Alice. “That depends a great deal on where you want to get to,” said the Cat. “I don’t much care,” said Alice. “Then it doesn’t matter which way you go,” said the Cat. “So long as I get somewhere,” Alice added as an explanation. “Oh you are sure to do that,” said the Cat, “as long as you walk long enough”.

This quintessential Lewis Carol excerpt is often paraphrased to “If you do not know your destination then it does not matter how you get there”.

A good example is the well-intended objective of providing fresh water to communities in Malawi by drilling and equipping water wells; laudable certainly, but limited in scope and outcomes. A water well alone does not a water department make. For sure a source is vital. However by itself a source does not mean reliable potable water delivery. Much more is needed to construct a sustainable supply including well locations, repair, planned maintenance, spare parts, transportation and trained personnel.

Now we have a job for a systems designer and builder. Wonder of wonders, on the job was a Canadian organization, Engineers Without Borders. This group of human development pioneers identified a major deficiency: not establishing the destination first and then starting the journey.

The water department destination defines the outcome; building the components are the tasks. Technology stepped in by providing terrestrial location methods. Now existing wells can be located and new ones positioned. Following close behind is monitoring the life cycle of hand pumps, wells and boreholes, training community members, provision of spare parts and building partnerships. Two water organizations have invested to scale up the program. Upon completion, EWB will have mapped over a third of all water points in Malawi.

The Malawian Water Department, Alice and EWB now have the potential for a mutual outcome. If Alice asks where to drill a water well, the Cat may well answer, “That depends a great deal on what she wants to achieve”; if she asks the Cat how to create a sustainable water supply for all Malwians, the Cat may well answer, “Build all the elements that constitute a water department”.

Ask Engineers Without Borders and their Malawian partners to give you a hand.

Nortel Networks Dilemas at work and play

Dilemmas in Work and Play

Whatever happened to Goldilocks after her adventure with the three bears?  What was the  little pig going to do when he or she went to market? What were  the seven dwarfs digging for when they went off to work? What kind of pies did Simple Simon make and why was he called Simple? Why did the three little pigs decide on such different building materials?  Why did Jack not patent the seed that generated his bean stock? Why did Dorothy’s red shoes not become  popular foot ware? Why did the Big Bad Wolf not pursue an acting career following such a wonderful Grandmother imitation?

Why did Nortel fail?

Fairy tales are just that, they are fairy tales. They are entertaining, often contain a meaningful message and readers can conjure up as many endings as imaginations will allow. They may be pleasant or nightmarish. The Nortel failure belongs in the fairy tale nightmare category because the story is so implausible as to be fictional.

After a litany of missteps, customers coined the phrase that the company was under a Black Cloud. Such a label is bad news for everybody as attested by  two examples. Treasure Island features the Black Spot, a symbol when delivered to victim meant a guilty verdict carrying severe punishment. Lil’ Abner highlighted  a mournful character by the name of Joe Btfspik whose continual misfortunes were symbolized by a Black Cloud over his head.

A Black Cloud is certainly bad news, even an imaginary one. Nortel stakeholders are well justified in categorizing their misfortunes as a fairy tale with major nightmarish overtones. Alas there is nothing imaginary about this tale.

 

 

 

 

 

 

You have to know when to Holden and know when to Foldem (With apologies to Kenny Rogers)

 

Beginning in the mid 1800s as a saddle manufacturer, Holden passed through many stages into an Australian car manufacturer. Now the bad news is out and the company will be shuttering all production in 2017.

The story of auto manufacturing in Australia closely mimics many industries world wide. The scenario frequently progresses from embryonic to commercialization to expansion, to significant profitability, to maturation and consolidation.  The pattern begins with a single enterprise, moving to several,  to many, to consolidation.  Following the bouncing Australian auto ball replicates both.

Holden is  a domestic start up that flourished early in the 20th century, manufacturing cars suited to the Australian market. Generally the autos were robust and of  simple in design. General Motors acquired Holden in 1931. The company retained independence in design and engineering. As expected other manufacturers set up shop in Australia including Ford and Chrysler. Laterally companies from Japan and Korea made themselves at home as they have all over the world.

Government inspired support programs were part of the evolution in sometimes vain attempts to maintain competiveness.. The support ranged  from import taxes, research and development credits,  subsidies, labor force training, cash injections  and ownership. Because auto manufacturing is so ubiquitous and massive world wide, the industry is always involved in controversy when economic circumstances change. The 2008 melt down is a wonderful example as governments stepped up to the ownership plate.

News of the Holden manufacturing closure generated a notable quote “A bit sad, very sad actually because I’ve been a follower of Holden with my father ” said Bruce Lethborg,  President of Holden Sporting Car Club of Victoria. “My father had Holden cars,  my first car was a 1966 HR Holden, its just devastating really

The Holden saga is a recent example of a long line of auto drop outs. Well known in the bone yard are Packard, Studebaker, Hudson, Kaiser, Fraser, Cord and Reo  The auto industry is a very big business with a great deal at stake. Different stakeholders win and lose at different times.

The only  clear and consistent winners are antique car collectors.

 

 

 

 

 

 

The difference between buying commodities and controlling them is droll: one generates angst, the other matters of control

For hundreds of years world wide resource exploitation has left paths of political unrest, wealth creation, economic benefits and technological leadership.  Armed conflicts, exploitation, and broken contracts are three of many unfortunate outcomes. The history of salt, rubber, tea, sugar, gold, oil and other commodities are the subject of many stories, good and bad. Follow the commodities and you follow the money.

The efforts to secure sources of supply and make money are ever increasing. Universal search for materials of all kinds continues even to the point where space is contemplated as a source for many metals and minerals.

Non renewable energy sources have moved into centre stage. Economic and technical barriers to access are lowered relatively easily; political barriers not so much. A simple readership survey emphasizes how much the politics of fossil fuels dominates the world’s news. While many factors come into play, ownership of the resource is very high on the issues list.

World wide, the largest part of fossil fuel reserves are owned by agencies of the state.  Ownership fluctuates as privatization and expropriation wax and wane. Some jurisdictions have more or less stayed the course through out the history of the industry, notably Canada, the United States, and Australia. Quasi state ownership exists in many jurisdictions, including Norway and France.

Post World War 2  an innovative deal structure emerged in Indonesia with the Production Sharing Contract (PSC). A new concept where by the oil and gas assets remain under sovereign control. The exploration, production and marketing responsibilities go with the contractor. Production Sharing Contracts are widely embraced around the world.

The success of PSC’s seems to be be a compromise between private and public ownership. Based on outcomes many  parties  embrace the concept in spite of ideological differences. Perhaps the buying angst is diminished and at the same time ownership and control issues have a reduced impact. 

Hoarding cash by another name is what?

One definition is harboring resources for a time when the investing climate improves.

Much is being made about corporations squirreling away capital to a point where substantial economic damage is postulated. Funds are staying under the mattress. Canadian stats suggest levels of $ 525 billion in various treasuries, up from $ 150 billion ten years ago. United States based companies hold some $ 5.1 trillion, the UK $ 1.2 trillion. These are very large numbers.  Research and development, capital expenditures and increasing  dividends all suffer.

So now we witness collective cries to have this cash liberated to help get the economic ball rolling again. Corporations are not preserving resources to look good at the country club and to flaunt their bank account in the financial press.  In part these balance sheet decisions are made as protective measures, anticipating a more favorable investment climate and cheaper deals. All legitimate business objectives. A very important corporate responsibility is the return on the capital employed and deployed at management’s discretion. External intervention will likely erode this most important result.

The behavior of some corporations, governments and economic alliances provides a lot of ammunition to the contrary. The litany of malfeasance, extravagances and regulatory weaknesses leave all of us punch drunk.  A mistake would be made in correcting the problems by tarring  well and ethically run companies with the same punitive brush.

Many fine companies that have acted responsibility, and maintained great performance credentials for a very long time. The availability of discretionary assets is one of them.  We should keep them that way.

 

A Story of Two Industries

The Swiss watch industry offers a remarkable story of dominance, decline, rebirth and resurgence. By contrast, the Japanese electronics industry, thus far, offers a story of dominance and decline. Resurgence is not evident at this point.

Can one learn from the other?

The life of the Swiss watch industry is measured in centuries. The first mechanical device lasted the longest It used stored energy, as from a spring, transmitted it by gears to move indicators on the watch face. Some readers will remember the self winding watch. The kinetic energy of the wearers movements became the input energy.. Over a much shorter period a battery was used to supply the needed energy to drive the mechanisms. Change was accelerating in parallel with all other technological change. Now we are well into the quartz era. A battery supplies the energy to trigger quartz vibration at an exact frequency, and use this electronically to control to a digital or analog display.

Astonishingly the Swiss recognized early the potential of quartz technology but were very tardy in the implementation. The Japanese were very quick to adopt and commercialize the quartz technology. They soon dominated the industry. The reign of the Swiss watch seemed to be over. Global market share and Swiss manufacturing employment were down drastically from historical highs.

In 1983, the Swiss industry started to recover with the development of the Swatch. This time piece more than anything else revitalized the industry. The Federation of the Swiss Watch Industry undoubtedly played a major role. Their far reaching mandate seemed to have engendered an industry that cooperates very well on issues of mutual interest.

At a different time and space, the Japanese electronics industry offers a contrasting situation. After years of extraordinary growth, decline set in with market share erosion, high cost, and a slow down in the development of new products. Serious losses resulted. Japanese electronics companies now face major restructuring. Weaker players are disappearing and mergers are common place.

Modeling a turn around for electronics on the resurgence of the Swiss watch industry would include rationalization, a major reduction in the number of component parts, a much simplified product, and the extensive use of robotics in manufacturing .These changes reduce costs drastically. Vertical integration contributes significantly. Manufacturers use common parts, training of skilled workers, research and development and the provision of other common services. The Swiss mission was to regain the lost global dominance. Success is evident. Ironically this is the precise approach used by the Japanese in many other industries. Extensive participation by their government and trade associations is a basic strategy.

The ubiquitous use of smart phones acting as a timing device sets up an all new environment for the watch makers of the world.