FRAMINGHAM (04/18/2000) - METRICS OPENING DAY By Meridith Levinson Even before the internet, fantasy baseball was nothing like the games you played with the kids in your neighborhood--where patches of burned-out grass served as bases and a Wiffle ball functioned as your horsehide. Fantasy baseball has always been and remains the game for fans who show their passion for the sport not by playing, but by memorizing players' stats. This month, in the third century to be blessed by baseball, the game's fantasy version enters its 20th year. The web has not changed its rules, just the speed with which it's played.
"Fantasy baseball gives you the chance to act as if you're run- ning a real baseball team," says Steve Byrd, vice president of fantasy sports at Stats, a Morton Grove, Illinois-based company that provides sports information and statistical analysis to professional teams, the media and fans. To play, you and your buddies form a league of dream teams that, under the aegis of a commercial organizing body, "compete" throughout the baseball season. Before opening day, everyone gets together in the flesh or in a chat room to draft 25 to 30 current major league players for his or her team. Each team has a salary cap with which to woo or insult players (highest bidder gets the player). Once the season starts, your team earns points based on your players' performances during their actual games. You get points for things like the number of home runs your players score, bases they steal, winning games your pitcher throws and runs batted in. At season's end, the team with the most points wins.
Before the web, says Byrd, "Leagues would appoint one guy to be the commissioner. His responsibility was to read USA Today every day and calculate players' stats and scores." If team owners wanted to add or drop a player, they had to send requests via phone, fax or mail to Stats (or any organization that manages fantasy sports games). Each week, Stats would mail a report to teams with a summary of their standings.
But no more. Today trading players, tracking their performances and calculating team points is virtually effortless, not to mention instantaneous. Stats reporters attend every major league baseball game, recording every strike Pedro Martinez pitches or every runner Ivan Rodriguez erases in a laptop computer, which uploads immediately to Stats' server in Chicago, where the information is stored in a database and simultaneously delivered to many websites (including its own) and TV stations. So even if you're not as fast as Rickey Henderson on the field, you can finally keep up with him on the web.
DEPARTMENT OF BIG, SCARY NUMBERS
42: percent of workers using company equipment to surf the net during work breaks.
1,123,650: number of un-related webpages an average internet user will drudge through in his or her lifetime.
165,352,000: number of keystrokes an average internet user will make in his or her lifetime.
5.5 million: minimum number of new U.S. internet users in 1999.
1 billion: minimum number of unique webpages now on the internet. And so as not to forget the size of a billion, it's been approximately one billion seconds since LBJ announced he would not run for reelection.
Sources: Greenfield Online, The Fortino Group, Datamonitor Networking and Internet Group, and Inktomi Corp. and NEC Research Institute (plus back-of-the-envelope calculations) SOFTWARE SHIVER ME TIMBERS Who are the worst software pirates out there? The Software & Information Industry Association (SIIA) commissioned a third-party study of software use, including an estimate of the percentage of applications in use that were unauthorized. Countries with the highest piracy rates were:
Vietnam 97% China 95% Oman 93% Lebanon 93% CIS- less Russia 93% Russia 92% Indonesia 92% Bulgaria 90% Bahrain 90% Kuwait 88% The United States has a piracy rate of approximately 25 percent.
When translated into dollar figures, that piracy tops the chart, since the United States is the largest user of software. For more information, check www.siia.net/piracy.
TRAINING FOR ALL THE IT IN CHINA China's IT market is expanding faster than any in Asia, according to a recent report by IDC, sister company to CIO Communications. Other experts predict that by year's end it will have one of the largest IT markets in the Asia-Pacific region. Despite this growth, however, some Chinese IT executives feel they still have a lot to learn. Like, for instance, what is a CIO?
In January, representatives from some of Shanghai's most technologically sophisticated companies met with IT leaders from California and New York to talk shop and pick up some tricks of the trade. This was part of an international training program sponsored by New York City-based AppliedTheory Corp., Shanghai Information Investment and the Office of Shanghai National Economy & Society Information Leading Group. The goal: to train and certify current and future CIOs to help lead China's internet revolution.
"We are just beginning to understand what the CIO is all about," says Yuan Zhi Qing, manager of the IT department at the Shanghai office of Lucent Technologies. "The concept has been in our minds, but we haven't known how to incorporate that into a business strategy until now."
In October Qing and 30 other IT leaders met at a Shanghai college for a three-week training course on internet and business strategies. Instructors from Australia, Canada and the United States taught concepts such as e-business and business process reorganization. Six weeks later, the group traveled to the United States for two weeks to meet their counterparts at U.S. companies, including Apple Computer, Cisco Systems, Bristol-Myers Squibb Co. and Morgan Stanley Dean Witter & Co.
Meeting with executives from Bristol-Myers, for example, they gathered around the desk of Senior Director for Corporate Information Management Judy Cottone and grilled her about her job. What are her day-to-day responsibilities? How does she make decisions? How does one get to be an IT executive in the United States in the first place? "They left no stone unturned," says Cottone, who volunteered her time. "It was wonderful to see such curiosity."
During their farewell celebration the Chinese executives received certificates and summed up what they'd learned, speaking of reorganizing, developing e-commerce programs and implementing intranets--strategies many said they never had considered before. "The people [in the U.S.] have opened our eyes to so much about information technology," said Qing. "Now it is up to us to make these ideas work in China." -Matt Villano SWEET SUCCESS Edible bunnies. Sugar-coated eggs. Marshmallowy chickens. Makes your teeth hurt, right? But as Easter approaches, candy makers steel themselves for the last holiday in the triumvirate they bank on: Christmas, Valentine's Day and Easter. Small companies in particular rely on the sweet spots in the calendar to make up for slower sales through the rest of the year. Not long ago, Lake Champlain Chocolates of Burlington, Vt., tried to manage the peaks and valleys of its yearly production cycle with paper and dry-erase boards.
Tracking inventory, sales and production schedules and profits and losses that way was a logistical nightmare. For instance, four employees spent almost 24 hours a month counting and weighing all of the raw ingredients and packaging materials--some 360 SKUs, according to Curt Erikson, Lake Champlain Chocolates director of operations. But in fall 1998, the company implemented Syspro Impact Software's Impact Encore ERP package to help it cope with the market's sugar rush. The company expects to reduce the time spent taking inventory to six hours per month.
Each week, salespeople enter orders into the system. Based on their orders, it determines how much cocoa, cream and butter the company will need to produce all those bunnies and truffles, as well as how much foil and ribbon it will require to package them. It then checks the company's inventory--if stock is low, the system suggests purchase orders. Easy as taking candy from a...well, it's simple.
Erikson explains that the ERP system automatically flows into shipping and receiving information the accounting department's general ledger, allowing the company to better manage its profit-and-loss statement.
Though they wouldn't tell CIO the secret recipe for Lake Champlain's confectionery success, we got the feeling that technology might be just as important an ingredient as chocolate. -Meridith Levinson VIVE LE MINITEL The French take pride in doing things a little differently.
They eat cheese at the end of a meal. They celebrate a prison burning as their national holiday. They drive Renaults. So it should be no surprise that the Gaulois have an alternative to the internet, Minitel, and a different method of generating revenue from this online service than banner advertising.
Brought to French households as early as 1983, Minitel is the name for the 6.3 million dumb computer terminals from which citizens can access online services.
Thanks to Minitel, the French have been engaging in cybersex, banking online and accessing electronic phone directories long before the rest of the world logged on to the web.
Bruno Chaintron, director of Minitel for France Telecom, the national carrier that developed the system, says, "Minitel is a business model. One that made it possible to create an industry of online content providers in France that comprises 18,000 different online services that are all profitable."
TOUCH, AMERICAN DOTCOMS! France Telecom charges users for the time they spend online. Prices vary by service, and charges appear on a customer's phone bill.
In 1999, of the 5 billion francs that France Telecom generated from Minitel, 3 billion went to content providers. With the rest, the company covered costs and made its profits.
Many foreigners (read Americans), in love with by the web's flashy GUIs, are quick to mock Minitel for its antiquated technology and black-and-white text interface. But, argues Chaintron, "In spite of the technology, the business model is still up to date." That's one thing France Telecom doesn't intend to change. "It has no equivalent elsewhere," he adds. -Meridith Levinson THE LAW REASONS TO BE FEARFUL Taxation Every county, state and country has its own system for taxing the sale of goods. Currently, these taxes don't apply to the internet. Requiring a company to locate every buyer and determine what tax schemes that region uses would be too onerous a burden for most companies. Some constituents are pressuring lawmakers to develop a universal system for internet taxation. The World Trade Organization and a U.S. congressional committee are both busy at work. Industry watchers predict that one or both of these groups could announce a proposal in 2000.
Cyberliability Old legal theories applied to the computerized world get the catchy moniker cyberliability. In this realm the corporation usually assumes responsibility for the actions of its employees. But sometimes aggrieved parties can sue individual employees. Executives are vulnerable because their positions as officers of the company carry duties of fair dealing and good faith. Cyberliability also includes the danger of being held accountable for content on a corporate website. Say a site offers a home remedy for sore throats that involves gargling with honey. If a consumer follows the advice and then has an allergic reaction, is the company liable? At the moment, the answer is anybody's guess.
National Norms Companies that have anything to do with online content delivery need to be aware of different countries' regulations governing internet content. Not all countries feel compunctions about restricting speech.
Companies doing business in Indonesia, for example, need to know that the government forbids posting content relating to sadism, mysticism, consumerism, hedonism or feudalism, says Maury D. Shenk, a senior associate with Steptoe & Johnson in Washington, D.C. "I'm not sure what feudal content is," he says.
"But don't do it in Indonesia." -Jennifer Bresnahan OFF THE SHELF Edited by Carol Zarrow PLAYING TO WIN SERIOUS PLAY: HOW THE WORLD'S BEST COMPANIES SIMULATE TO INNOVATE By Michael Schrage Harvard Business School Press, 1999, $27.50 Have you been giving short shrift to your simulations? Ignoring your prototyping portfolio? Michael Schrage, a research associate at the MIT Media Lab, has written a book that may force you to rethink the way your company innovates.
Prototyping and other creative brainstorming processes are the "serious play" that leads to breakthrough innovations.
Among other examples, Schrage uses auto manufacturing to show how faster prototyping changed an industry. Until the early 1990s General Motors used computer-aided design (CAD), but only after building a clay model first.
Toyota, on the other hand, designed cars entirely with CAD, making its speed-to-market twice as fast as GM's.
Changing an existing prototyping culture is not without perils, and flawed assumptions can wreck not only prototypes but entire companies. But Schrage builds a convincing argument that the way companies design and interact with simulations lies at the heart of breakthrough innovation. -Todd Datz SIMPLICITY: THE NEW COMPETITIVE ADVANTAGE IN A WORLD OF MORE, BETTER, FASTER By Bill Jensen Perseus Books, 2000, $25 If he were truly interested in bringing simplicity to the huddled corporate masses, consultant Bill Jensen would have started with his own book. He repackages some well-worn communication theories with homey anecdotes, old survey results and quotes from people in well-known companies, and exhorts readers to revolutionize communication at their companies. His own revolution should include a red pen. -Christopher Koch CIO BEST SELLER LIST 5. Selling the Invisible: A Field Guide to Modern Marketing by Harry Beckwith Warner Books, 1997 4. The Dance of Change: The Challenges to Sustaining Momentum in Learning Organizations by Peter M. Senge et. al. Doubleday, 1999 3. Built to Last: Successful Habits of Visionary Companies by James C. Collins and Jerry I. Porras HarperCollins, 1994 2. The Fifth Discipline: The Art and Practice of the Learning Organization by Peter M. Senge Doubleday, 1990 1. First, Break All the Rules: What the World's Greatest Managers Do Differently by Marcus Buckingham and Curt Coffman Simon & Schuster, 1999 SOURCE: March 11, 2000 data, compiled by Powell's Books, Portland, Ore.
Tell us what you're reading and why at firstname.lastname@example.org WHAT THEY'RE READING Keith Powell, senior vice president for information services and CIO, Nortel Networks Corp., Brampton, Ontario Powell recommends three books from his night table: Business @ the Speed of Thought: Using a Digital Nervous System, by Bill Gates (Warner Books, 1999); Net Future: The 7 Cyber Trends That Will Drive Business, Create New Wealth and Define Your Future, by Chuck Martin (The McGraw-Hill Cos., 1998); The Secret of a Winning Culture: Building High-Performance Teams, by John R. Childress and Larry E. Senn (The Leadership Press, 1999).
ASSET MANAGEMENT HOW TO SPOT A RECYCLING POLICY GONE BAD Hey. A vendor with a sense of humor. Enterprise recycling company Redemtech sent this little checklist around:
Technology recycling has gone bad if my computers end up: 1 In my competitor's marketing department 2 In the clutches of Hackers-R-Us 3 In an unfriendly Third World nation 4 Being ransomed back to me for records I'd prefer not to discuss 5 At the office of Black Market & Illegal Software 6 In an unauthorized dump site being cataloged by an EPA investigator up to his knees in garbage 7 In a dark corner of our crowded warehouse where my boss is headed right now...looking for storage space 8 At the state prison rehabilitation center for white-collar crime, with all my personal records 9 At the R&D building of a business intelligence provider 10 Being sold for tens of thousands of dollars by the peddler who took it away for free 11 Or, finally, hiding in closets and desks all over the office, waiting for some direction from the person I assigned the responsibility Source: Redemtech, a subsidiary of Micro Electronics in Hilliard, Ohio HOT TOPIC KNOWLEDGE MANAGEMENT IT'S A JUNGLE IN THERE BY CAROL HILDEBRAND The bigger a company gets, the easier it becomes for its accumulated intellectual property to become an overgrown tangle. But losing track of intellectual assets can run you afoul of the law. Although recent legislation protects corporate intellectual goodies such as trade secrets, copyrighted materials or proprietary material developed in-house (see "Choose Your Poison," Page 132, and "The Death of Cybersquatting," Page 60), many companies have no idea whether they may be breaking the law themselves or letting others make off with their own intellectual assets, says Lynne Hall, managing director at Management Counsel in New Haven, Conn.
Hall has developed a methodology for what she calls an intellectual capital audit that helps companies inventory their intellectual assets and extract the greatest value from them. She customizes the audit for each client but uses questionnaires, surveys and personal interviews to identify human assets such as knowledge and skills, intellectual assets such as publications and memoranda, and intellectual property such as patents, copyrights, trade secrets and trademarks. The process varies in length; for one client it took nine months, for another, which wanted a more comprehensive survey, Hall's assessment took 18 months.
The audit works as both defense and offense, she says: Company A gets a view of its own internal noncompliance with the legislation, but it also gets a chance to check out how company B is infringing on A's property.
Hall tells of one high-tech corporation she audited. She found it was victim to "infringements of all kinds that resulted from the company's failure to map [its own] intellectual property, as well as [that of] direct and indirect competitors." It didn't adequately protect clusters of its own intellectual properties, and in some cases, unintentionally abandoned such properties by forgetting to pay patent, copyright and other fees, she says. Hall also confirmed, through reverse engineering and object and source code analysis, infringements from three direct competitors. By designing a process to track intellectual property policies, practices and procedures, as well as some sales, joint venture and licensing agreements with the competitors, Hall estimates that the company will add $500 million in revenue over the next five years.
Not all her audits will yield such a bonus, she admits. "But, just like anything else, a corporate portfolio of assets needs to be strategically leveraged and managed."
HOT TOPIC STAFFING WINNING HEARTS AND MINDS By Tom Field Middle school: when young people get serious about academics, the opposite sex...and IT careers? That's what some St. Louis-area businesses are hoping.
They've banded together with local middle schools in a new program designed to inspire adolescents to picture a future as high-tech workers. The program, developed under the auspices of the Workforce Enhancement Committee of the St.
Louis Regional Chamber and Growth Association (RCGA), brings teachers and IT professionals together to introduce 6th, 7th and 8th graders to IT skills and concepts.
Two companies, biotech giant Monsanto and the business consultancy Maritz Performance Improvement, kicked off the pilot of the IT Career Awareness Program last fall. IT professionals from those companies had spent the previous summer working on lesson plans with teachers from two schools (as well as giving them a crash course in corporate IT). This semester, the number of school-company partnerships has increased to five; when the program moves from pilot to formal rollout next fall, 30 schools and companies are expected to be participating.
Program developers were responding to the pinch in IT staffing woes as well as statistics that show only about 3 percent of current high school students indicate an interest in IT careers. "It seemed like we were dealing with a lack of knowledge about technology careers," says Linda Becker, director of professional development at Maritz, "as well as a bit of an image problem"--the geek stigma. Becker, along with Maritz Director for Learning Technologies B.J.
Kamler and Monsanto IT Training Coordinator Lisa Hays, designed and implemented the program and helped brainstorm lesson plans last summer.
By bringing IT professionals and students together, the RCGA hopes to bridge IT awareness gaps and steer a few students toward prospective high-tech careers.
Middle school students were targeted, Becker says, because "they're more impressionable than high school students--a little more excited about learning."
For the companies, the investment is small: the RCGA is asking for companies to donate only a couple of people for a couple of hours per week. The payoff, though, is tricky to measure. Yes, there is the prospect that staffing-starved companies can do a little bit of recruiting, but who can predict which of today's middle school students will become tomorrow's IT workers? But Becker offers a different incentive for companies to invest in IT education: "Even if kids don't end up picking IT as a career, they'll still be better educated consumers and be smarter about technology."