mikolas

New York Times (NYT) Running On Fumes

October 23, 2008 – 23:17

The Q3 result was not as bad as I thought, to see something positive in the third quarter.

Understanding Causality

October 23, 2008 – 11:44

It’s been a while since my last post, mainly due to work overload and house renovation. However, I’ve also been occupied with a couple of science-meets-philosophy type of questions, above all causality and it’s role in human decision making processes.

In essence causality can be described by means of logic so that from event A follows event B. To put it simply, from action follows reaction – the principle of cause and effect. Causality also raises a lot of philosophical questions, most importantly about the free will of humans, as the law of causality implies that effects are predetermined and such free of any decision making processes. The philosophical debate on causality has been going on for since the times of Aristotle so I’m not going to dig any deeper into that. I’ll just say that delving into the philosophy of causality is pretty mind bending and will cause a lot of sleepless nights.

So why I started thinking about this question in the first place? Well, I did not actively start thinking on it – rather the question asked itself when doing some thought experiments on business decision making processes, especially trying to predict the future conditions of given business.

Businesses put a lot of effort in crafting right investment portfolios and the process usually follows the same pattern: investigate market situation, try to predict how market develops, pretend to spot any white spots in the market and finally formulate a strategy and action plan according to aforementioned data. The problem with the process is that it never produces desired output. Why? We never really know for sure. A competitor did this, the market evolved as that and the consumer needs were those. But we really never know which bits of all things actually had an effect on our own market performance. We can try to understand, but in the end of the day, we do not know for sure.

The point is, it is totally impossible to try to predict the future using the numerical methods since it is also impossible to predict the past. Trying to tie things together using such coarse grained data is naive, as is even trying to analyze microscopic bits of data – there simply is too much information. Take consumer behavior. How is it possible to predict an adoption model for new technology? I’d say it is nearly impossible. It is not only the maturity of the technology itself, or its perceived usefulness to the consumer. There are so many microscopic level fluctuations that precise predictions are not possible. One can have absolutely fabulous technology and still fail in the marketplace and on another hand some mediocre offering can still beat the competition. Or both could fail due to lack of consumer interest, although the market data showed an explicit interest for our particular innovation. Well, maybe we asked the wrong people. Or maybe the consumers’ perception of the product was different from ours although we knew exactly what the consumer wanted using focus groups. Or or or. :-)

This was the thing that made me to try to understand causality. And out of that thinking I’ve come up with some conclusions, although my thinking is still evolving as I write this and I’m certain that I will change my mind about these as my own take on the subject matures.

First of all, instead of trying to predict, you should accept that trying to make precise predictions based on financial climate is quite useless, and in many ways dangerous. Secondly, market data gets you nowhere, it only limits your possibilities to succeed if you use market data as your dominant guide. Thirdly, you need visionary people in your organization in order to succeed. I’ll come to that later, as for me visionary means something else than majority of people. Or at least my understanding on the subject is starting to clarify.

I think I already described some of the problems with so called precise predictions. It is impossible to have precise view on what is going to happen if you do not even know how you got to the present situation. I’m not saying that one should not try to consider future possibilities, but one should not focus on finding the path instead of walking it. The problem with predictions is, that they will affect your day to day decision making processes and as predictions are based on fuzzy data, they will eventually guide you to the wrong place. And you do not even realize how you got there, since you trust the data.

To the second one is tougher one. Businesses tend to be overly focused on market data with monthly reporting of market share, tiny fluctuations in the cash flow and sales performance. While measuring business performance is of course very important thing, short sighted visibility of the data can easily lead too much to opportunism and making decisions with too much focus on current operative environment, lacking the possibility to evaluate the consequences on longer term. And it is the long term that really matters. It is you who should guide the company, not numbers or macroeconomic environment.

The third one is the toughest one. Many organizations focus on hiring the brightest talent in the market, with the delusion that having the brightest minds will produce the best outcome. This is usually wrong as leadership based purely on intellect will lead to implementing too much logic to the core of business, whereas humans, and such consumers and markets, are not logical. This leaves no room for risky innovation and easily leads to safe bets and protectionism. Instead, one should try to find people with a vision. Having a vision is not about having unrealistic view on the consumer needs, building a tunnel vision on opportunities, or egoism, but having true, intuitive, talent of seeing causal lines.

Since causality is something that you can not ever fully control, the only way to true success is the ability to see the future instead of predicting it. The ability to see causal lines is a gift, something some people (true visionaries) have and something that rarely, if ever, can be learned. Having a visionary leader also leads to have a solid vision and values, that resonate with the customers, to follow even when times get tougher. Visionary people tend to follow the vision, not market data. If one sacrifices the core values and vision of the company for short term suboptimal financial wins, the consumers will gradually be alienated and the game will sooner or later be over no matter what.

So the success very much depends on accepting the future as it formulates and adapting to the changes, not on trying to slow down market development and disruptions. Causality shares similar attributes with entropy in that it eventually wins the game.

So, that’s about it. I think this all started after so many healthy companies started destroying their future in the current economic turmoil and forgot why they actually exist, what is the purpose of the company. There are two exceptions to this, namely Apple and Google, that actually quite stubbornly follow their vision even in the slowing consumer demand and decline in media sales respectively. And they both are lead by visionaries. And they both are quite successful in what they do.

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Newcomb’s Paradox

October 19, 2008 – 0:44

If you have no trouble sleeping, after reading this you will have.

Posted in Mental Note | No Comments » |

Global Correlations in Random Data

October 19, 2008 – 0:37

Does random data correlate with global events?

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About iPhone Software Development

September 2, 2008 – 21:10

I’ve been now playing with Apple’s iPhone SDK for a week or so after joining the developer program. My first impressions are quite positive, given that I’d never before written a single line of Objective-C or having any deeper knowledge of Cocoa and other relevant frameworks on OS X.

After doing a few ports of GPL libraries and playing around with the UI framework, I can only say that the SDK is the best mobile SDK I’ve ever used so far. My previous experiences are from MIDP (sucks), Windows Mobile (sucks even more) and Symbian (ultimate horror) so my expectations were not that high. However, Apple’s take on mobile programming is simply elegant and pretty straightforward to learn.

My only complain is my personal dislike for Interface Builder. Somehow, I’ve always been more inclined to make user interfaces programmatically, simply because that way one has total control on what is happening. With Cocoa Touch, making UI via code is pretty simple, as long as you read the documentation first and get your hands into the MVC model under the hood. Still, I think I’ll give IB a chance if I get my brain around it :-)

Given the ease of development (well, relative ease compared to other mobile terminals), it is not hard to see AppStore gaining more momentum. 12 months from now, one should have a target audience of 50 million customers or so. So it is not that impossible to sell a few thousend copies of an application if it fits some customer need. I for one will be trying out how the distribution model works for some niche applications and hopefully make a few bucks in the process.

Posted in Computing, Technology | No Comments » |

Microblogging vs. Hyperlocal News

August 22, 2008 – 10:51

Once again, Steve Outing had a thought provoking article about local news. Pretty much the same idea has been lingering in my mind for a while, not least because I’m an active user of Jaiku. The things I think play in favor of microblogging against local news are quite simple: microblogging is a natural web medium whereas local news is not. The differences, I think, are both technical and mental. Now for a quick list of issues first came to my mind:

Mobile, location aware, microblogging: systems like Jaiku automatically know from where you’re blogging. Your presence stream by definition is hyper-local. Multiply the amount of users in a given territory 24/7 and you have more local representatives able to publish events, realtime, than any news organization
Flickr & YouTube: with current mobile handsets it is dead easy to upload videos and images to 3rd party services. You can attach these to your presence stream effectively becoming a multimedia reporter on the go. While the quality might not be as good as for professional reporters, at least I’d rather see events unfolding in realtime, not after all the interesting has happened.
Technology investment: none. Just use existing services.
Aggregating a local news portal: use Yahoo Pipes for regional filtering and a piece of PHP to put the RSS streams together and you have a graigslist of local news. With virtually zero investment.

I could go on and on, but you should get the point: while traditional media organizations tend to build everything themselves, with upfront investments, large staff and slow time-to-market, we who have been doing web services, even before last bubble, would do it differently.

Also, notice the focus on mobile. I bet that mobile will be the next web 2.0 during coming 2 to 4 years. The reason is simply the flexibility of new smartphones with good web browsers, GPS, 3G/HSDPA and the like. In fact the future is already here, but people don’t pay attention as we still lack the services and the existing ones are still a bit hard to use.

PS. An excellent (IMHO) example of building hyperlocal news service the microblogging way is Finnish news service called Vartti (part of SanomaWSOY corporation which is also my place of employment).

Posted in Business, Technology | No Comments » |

Cosmic Variance: Blogoplexus

August 19, 2008 – 22:11

Some worthwhile science blogs listed by Cosmic Variance.

Posted in Mental Note | No Comments » |

New Firmware for Sony Reader

August 12, 2008 – 16:06

Sony PRS-505 Reader

Image via Wikipedia

Sony has released a new firmware revision for their PRS-505 Reader. The most notable features are support for Adobe Digital Editions and PDF text reflowing. The latter is most interesting for me, as I tend to keep lot of scientific publications on my reader and those are mostly in PDF format. Now that the Reader is able to nicely reflow the text, you can magnify the font to a more readable size and the reading experience is actually excellent.

If you still have not tried any of the electronic reading devices, I definitely urge you to do it. Once you realize that it is possible to carry around gigabytes of books in a single lightweight device, there is no turning back.

And what am I currently reading? The list is as follows:

The Black Hole War by Leonard Susskind

Albert Einstein: His Life and Universe by Walter Isaacson

Several academic publications on quantum mechanics.