April 23, 2009
Cutter IT Journal’s issue on “New Metrics for Turbulent Times” is out! Here’s an excerpt from my Guest Editor introduction. This issue contains some great articles by Cutter authors Vince Kellen, Michael Rosen, Evan Campbell, Sara Cullen, and William Walton on Ethics, IT Architecture, Agile Methods, Outsourcing, and Portfolio Management. Interested in more – perhaps a trial subscription? email me at email@example.com.
New Metrics for Managing Turbulent Times
Point: Tough Times Demand New Metrics
The recession is forcing companies to make tough decisions. New metrics are needed to make the right decisions on getting through the downturn.
Counterpoint: Existing Metrics Are Good Enough
Organizations should resist the urge to concoct new measures when the existing ones, applied correctly, will do.
Opening Statement, by Michael Mah
The current economic downturn has cut a deep gash in the economies of virtually every country and industry, affecting the lives of perhaps every living person in many ways not seen in over 50 years. In a recent live appearance on CNBC, billionaire Warren Buffett said unemployment will likely climb higher and that the economy has basically “fallen off a cliff.” Fear is dominating Americans’ behavior and the economy has followed the worst-case scenario he envisioned. Moreover, in a global recession – fear goes global. It’s not limited to just Americans and U.S. companies. Economies around the world are more interdependent today than ever before. In work and in private life, no one seems immune from having to make tough decisions in the months ahead.
How do people make wise decisions in the face of such unrest? What information do they rely upon and how does that data come into play? When it comes to work life, if cutting costs are mandatory, should we simply make across-the-board cuts with a hatchet, or is it wise to find a more surgical approach? Or is this a time to make strategic decisions to invest, and thereby out-recover the competition when the recession ends? What information, what metrics, should we rely upon to decide?
We are firmly on the scarcity side of the abundance/scarcity continuum. For many (but not all), cost cutting is the order of the day. If you’re a bank or an auto company, it could be a question of survival. Meanwhile, others may find opportunity. For example, discount auto insurers and others are finding their market share increasing as households look for less expensive choices. Companies in these spheres might make a case for investment as their competitors shrink. In fact, during the last economic downturn, some like Intel and IBM famously invested in R&D as their competitors slashed investments. They generated record profits and dominated in technologies like Wi-Fi, once the economy recovered. While this downturn is certainly more severe than the last, the opportunities for those who capitalize may perhaps be even greater.
But let’s get back to the title of this issue, where we allude to metrics in turbulent times. Metrics, put simply, are a synonym for information. While the nature of information is something we want to address in this issue, we also question how people’s minds use or don’t use information during times of turbulence and fear. Joseph LeDoux, professor of neuroscience at New York University and author of The Emotional Brain, explains that the amygdala, an almond-sized clump of tissue above the brainstem, triggers fight-or-flight responses in the brain that actually inhibit cognitive thinking and the logical use of information by the cerebral cortex. In short, our primitive brain imagines that there’s a saber-toothed tiger about to eat us, and it tells us to not think: just run for your life. And in his book “Blink,” author Malcolm Gladwell describes that great decision makers aren’t those who process the most information or spend the most time deliberating, but are those who filter factors that matter from an overwhelming number of variables. Sometimes this happens in the blink of an eye. How should we make decisions while under duress, and what are metrics that matter?
In this issue of Cutter IT Journal, our authors offer you a variety of perspectives to help you address these challenges. We welcome their perspectives on whether new ways of thinking and new forms of information are in order as we confront the current dramatic swing in the business cycle. learn more…
January 5, 2009
Happy New Year 2009!
I’m pleased to kick off an editorial New Year at Cutter Consortium as guest editor for the March 2009 issue of the Cutter IT Journal. I’m posting the call for papers here in case any of you sports fans would like to make a submission for consideration. Let me know by emailing me 🙂
CALL FOR PAPERS
Cutter IT Journal
Guest Editor: Michael Mah
Abstract Submission Date: 13 January 2009 Articles Due: 6 February 2009
New Metrics for Managing Turbulent Times
The current economic downturn has cut a deep gash in the economies of virtually every country and industry, affecting the lives of perhaps every living person in many ways not seen in over 50 years. It seems as though the fall of communism was, in hindsight, a prelude to an even larger shockwave that would come and strike the heart of capitalism, completing a shakeup to economies of nearly every nation across the globe.
In a previous issue of CITJ, Guest Editor Bob Charette talked about fingers pointing at risk (mis)management as a major cause of the current economic crisis, with quantitative models and processes used by banks, mortgage companies, and financial institutions as being a source of failure in judgment and poor decision making. He says that investor Warren Buffet summed up the skepticism about quantitative models this way: “All I can say is, beware of geeks … bearing formulas.”
There is no doubt that there is plenty of blame to go around. To point the finger solely at financial metrics as being the root cause of the current crisis may be unfair. In fact, we also know that companies also had access to reliable and accurate information, but in many cases senior executives ignored warnings in an effort to generate even higher profits. In short, we might say that the one rather powerful human emotion that trumped the information at hand – both good and bad – was simple greed. In the movie “Wall Street,” the character of Gordon Gekko, played by Michael Douglas, said “Greed is good.” Well, is it?
So now that we’re suffering the consequences of poor macro-economic decision making, where do we go from here? How will IT managers make tough decisions in the face of the economic environments of the companies that they serve? There is no doubt that we are now firmly on the scarcity side of the abundance/scarcity continuum. For many (but not all), cost cutting is now the order of the day. Others may see opportunity. In the last economic downturn, a few companies like Intel and IBM famously invested in R&D as their competitors slashed investments, generating record profits in technologies like Wi-Fi, once the economy recovered. Who decides and how?
As to metrics, what information will companies rely upon to navigate through these times? What decisions might they make in the face of the scarcity/abundance dilemma? If organizations are driven by fear, will they make bad decisions or good ones while in that highly emotional state, regardless of whatever information is at hand? Will CFO’s rule the day and attempt to slash labor costs and mandate more use of offshore resources? Or will this strategy result in a divesting of valuable in-house knowledge and potentially cripple a company’s future as it undergoes an engineering lobotomy, leaving it unable to later recover? Will there be a return of more Death March projects as organizations are subjected to even more deadline pressure while simultaneously being hit with budget cuts and staffing limitations?
The March 2009 Cutter IT Journal invites useful debate and analyses on the new metrics being used by organizations to make critical decisions regarding their future in a time of enormous economic turbulence.
TOPICS OF INTEREST MAY INCLUDE (but are certainly not limited to) the following:
* What measures should organizations use if faced with a mandate to simply cut costs? Should these cuts be across the board and made with a hatchet, or will there be more deliberate, surgical cuts?
* How can IT managers make the opposite case if desired, to invest through the downturn? Are new ROI measures needed to argue the case for delivering value and business benefit rather than cutting expenditures?
* How should IT organizations measure themselves if cost cutting were to include offshoring? How should they measure vendors?
* Eric Schmidt, CEO of Google, said in a Meet the Press interview that America has the brain power and talent to “innovate itself out of this recession.” How might one measure innovation and the resultant business benefit?
* How will organizations balance the reduction of costs with the need to still meet ever-important schedules while not sacrificing quality? What measures will they rely upon to achieve this balance?
* Forward looking firms will see this economic climate as an opportunity to enter markets vacated by weakened competitors. What indicators will companies use to identify when and how to move into these markets?
* Are Agile processes a no-brainer? When you consider that Agile espouses both incremental and earlier delivery of business value (instead of waiting until the end of a longer waterfall process/project), should organizations be looking at a different ROI model for Agile?
TO SUBMIT AN ARTICLE IDEA
Please respond to Michael Mah at michael[dot]mah[at]qsma[dot]com with a copy to itjournal[at]cutter[dot]com, no later than 6 January and include an extended abstract and a short article outline showing major discussion points.
Articles are due on 6 February 2009.
Most Cutter IT Journal articles are approximately 2,500-3,500 words long, plus whatever graphics are appropriate. If you have any other questions, please do not hesitate to contact CITJ’s Group Publisher, Christine Generali at cgenerali[at]cutter[dot]com or the Guest Editor, Michael Mah at michael[dot]mah[at]qsma[dot]com. Editorial guidelines are available at http://www.cutter.com/content-and-analysis/journals-and-reports/cut
Typical readers of Cutter IT Journal range from CIOs and vice presidents of software organizations to IT managers, directors, project leaders, and very senior technical staff. Most work in fairly large organizations: Fortune 500 IT shops, large computer vendors (IBM, HP, etc.), and government agencies. 48% of our readership is outside of the US (15% from Canada, 14% Europe, 5% Australia/NZ, 14% elsewhere). Please avoid introductory-level, tutorial coverage of a topic. Assume you’re writing for someone who has been in the industry for 10 to 20 years, is very busy, and very impatient. Assume he or she will be asking, “What’s the point? What do I do with this information?” Apply the “So what?” test to everything you write.
We are pleased to offer Journal authors a year’s complimentary subscription and 10 copies of the issue in which they are published. In addition, we occasionally pull excerpts, along with the author’s bio, to include in our weekly Cutter Edge e-mail bulletin, which reaches another 8,000 readers. We’d also be pleased to quote you, or passages from your article, in Cutter press releases. If you plan to be speaking at industry conferences, we can arrange to make copies of your article or the entire issue available for attendees of those speaking engagements — furthering your own promotional efforts.
ABOUT CUTTER IT JOURNAL
No other journal brings together so many cutting-edge thinkers, and lets them speak so bluntly and frankly. We strive to maintain the Journal’s reputation as the “Harvard Business Review of IT.” Our goal is to present well-grounded opinion (based on real, accountable experiences), research, and animated debate about each topic the Journal explores.
March 22, 2006
The 2006 QSM Software Almanac – IT Metrics Edition, is here! It contains more than 100 pages of analysis and observations that provide unparalleled access to the latest developments in the software industry.
It’s with great pride that we’re announcing the Almanac here on the pages of Optimal Friction. My partners here at QSM have assembled overviews and in-depth analysis of more than 500 completed projects from all major industries, collected in the last 5 years. One can easily peruse the (sometimes surprising) qualities and characteristics of “best/worst in class” projects, with the attendant implications about core metrics tradeoffs. Best of all, it describes extensive actionable intelligence gathered over more than 25 years of consulting practice as revealed by the software industry’s most detailed and comprehensive database of completed projects using the analysis capabilities within the QSM SLIM Suite of tools.
Special thanks to Doug Putnam, Kate Armel, Don Beckett, and all on the QSM team. Readers of the Almanac will no doubt recognize the heritage of this work, tracing to Larry Putnam’s pioneering research on metrics for the software and Information Technology fields.
As the saying goes,
“without metrics, you’re just a person with another opinion,”
and the Almanac will, in easily understood, detailed, expert analysis, provide insight into the importance of collecting and analyzing core metrics, using history as a guide to the future. This volume makes a wonderful companion to the QSM SLIM Suite of tools for rapid, accurate benchmarking, estimating and “in flight” project control, right at the desktop. Users of SLIM will find the Almanac highly useful as benchmark data for software project estimates and productivity assessments.
No matter what your industry or corporate stovepipe, or the scope, schedule, staffing, technique or language used in your world: you will have a better grasp on industry trends that can will help improve your company’s project management and save time and money. For more information and ordering, please contact Sean Callaghan at QSM Associates 413-499-0988, ext 105. The cost is $500 with discounts on multiple volumes of 5 or more.