October 27, 2016

Making Technologies Useful to End Users Can Be Hard

Sharma's theory sounds somewhat similar to that of Bhidé in his The Venturesome Economy.

(p. B4) Anshu​ Sharma,​ a venture capitalist at Storm Ventures, thinks he knows why so many companies that should have all the resources and brainpower required to build the next big thing so often fail to. He calls his thesis the "stack fallacy," and though he sketched its outline in a recent essay, I found it so compelling that I thought it worth a more thorough exploration of the implications of his theory. What follows is the result of that conversation.

"Stack fallacy is the mistaken belief that it is trivial to build the layer above yours," Mr. Sharma wrote. And as someone who worked at both Oracle and Salesforce, his exhibit A is these two companies. To Oracle, which is primarily a database company, Salesforce is just a "hosted database app," he wrote. and yet despite spending millions on it, Oracle has been unable to beat Salesforce in Salesforce's core competency, notably customer-relations management software.

It helps to understand that in tech, the "stack" is the layer cake of technology, one level of abstraction sitting atop the next, that ultimately delivers a product or service to the user. On the Internet, for example, there is a stack of technologies stretching from the server through the operating system running on it through a cloud abstraction layer and then the apps running atop that, until you reach the user. Even the electricity grid required to power the data center in which the server lives could be considered part of the technology "stack" of, say, your favorite email service.

. . .

The reason that companies fail when they try to move up the stack is simple, argues Mr. Sharma: They don't have firsthand empathy for what customers of the product one level above theirs in the stack actually want. Database engineers at Oracle don't know what supply-chain managers at Fortune 500 companies want out of an enterprise resource-planning system like SAP, but that hasn't stopped Oracle from trying to compete in that space.

For the full commentary, see:

CHRISTOPHER MIMS. "Why Companies Are Being Disrupted." The Wall Street Journal (Mon., Jan. 25, 2016): B4.

(Note: ellipsis added.)

(Note: the online version of the commentary has the title "Why Big Companies Keep Getting Disrupted." The last sentence quoted above appears in the online, but not the print, version of the article.)

Sharma's blog essay mentioned above, is:

Sharma, Anshu. "Why Big Companies Keep Failing: The Stack Fallacy." On Crunch Network blog, Posted Jan. 18, 2016.

The Bhidé book that I mention way above, is:

Bhidé, Amar. The Venturesome Economy: How Innovation Sustains Prosperity in a More Connected World. Princeton, NJ: Princeton University Press, 2008.

A briefer version of Bhidé's theory can be found in:

Bhidé, Amar. "The Venturesome Economy: How Innovation Sustains Prosperity in a More Connected World." Journal of Applied Corporate Finance 21, no. 1 (Winter 2009): 8-23.

October 26, 2016

Censored and Walled-Off Internet Hurts Chinese Start-Ups

(p. B1) Two decades after Beijing began walling off its homegrown internet from the rest of the planet, the digital world has split between China and everybody else. That has prevented American technology companies like Facebook and Uber, which recently agreed to sell its China operations, from independently being able to tap the Chinese market.

For China's web companies, the divide may have even more significant implications.

It has penned in the country's biggest and most innovative internet companies. Alibaba, Baidu and Tencent have grown to be some of the world's largest internet companies, but they rely almost entirely on domestic businesses. Their ventures abroad have been mostly desultory, and prognostications that they will challenge American giants internationally have (p. B2) not materialized.

. . .

In many ways, the split is like 19th century railroads in the United States, when rails of different sizes hindered a train's ability to go from one place to another.

"The barrier to entering the U.S. or China market is becoming higher and higher," said Kai-fu Lee, a venture investor from Taiwan and former head of Google China.

The difficulties that China's internet companies face in expanding their success abroad are epitomized by WeChat, the messaging app owned by Tencent.

. . .

Critics pointed to Tencent's lack of distinctive marketing, a record of censorship and surveillance in China and its late arrival to foreign markets. Yet the biggest problem was that outside of China, WeChat was just not the same. Within China, WeChat can be used to do almost everything, like pay bills, hail a taxi, book a doctor's appointment, share photos and chat. Yet its ability to do that is dependent on other Chinese internet services that are limited outside the country.

For the full story, see:

PAUL MOZUR. "Internet's Great Wall." The New York Times (Weds., AUG. 10, 2016): B1-B2.

(Note: ellipses added.)

(Note: the online version of the story has the date AUG. 9, 2016, and has the title "Chinese Tech Firms Forced to Choose Market: Home or Everywhere Else.")

October 25, 2016

Modern Technology Adds to Knowledge of Culture and Religion

(p. A6) Nearly half a century ago, archaeologists found a charred ancient scroll in the ark of a synagogue on the western shore of the Dead Sea.

The lump of carbonized parchment could not be opened or read. Its curators did nothing but conserve it, hoping that new technology might one day emerge to make the scroll legible.

Just such a technology has now been perfected by computer scientists at the University of Kentucky. Working with biblical scholars in Jerusalem, they have used a computer to unfurl a digital image of the scroll.

It turns out to hold a fragment identical to the Masoretic text of the Hebrew Bible and, at nearly 2,000 years old, is the earliest instance of the text.

The writing retrieved by the computer from the digital image of the unopened scroll is amazingly clear and legible, in contrast to the scroll's blackened and beaten-up exterior. "Never in our wildest dreams did we think anything would come of it," said Pnina Shor, the head of the Dead Sea Scrolls Project at the Israel Antiquities Authority.

Scholars say this remarkable new technique may make it possible to read other scrolls too brittle to be unrolled.

. . .

The experts say this new method may make it possible to read other ancient scrolls, including several Dead Sea scrolls and about 300 carbonized ones from Herculaneum, which were destroyed by the volcanic eruption of Mount Vesuvius in A.D. 79.

. . .

The feat of recovering the text was made possible by software programs developed by W. Brent Seales, a computer scientist at the University of Kentucky. Inspired by the hope of reading the many charred and unopenable scrolls found at Herculaneum, near Pompeii in Italy, Dr. Seales has been working for the last 13 years on ways to read the text inside an ancient scroll.

. . .

He succeeded in 2009 in working out the physical structure of the ruffled layers of papyrus in a Herculaneum scroll.

He has since developed a method, called virtual unwrapping, to model the surface of an ancient scroll in the form of a mesh of tiny triangles. Each triangle can be resized by the computer until the virtual surface makes the best fit to the internal structure of the scroll, as revealed by the scanning method. The blobs of ink are assigned to their right place on the structure, and the computer then unfolds the whole 3-D structure into a 2-D sheet.

For the full story, see:

NICHOLAS WADE. "Technology Unlocks Secrets of a Biblical Scroll." The New York Times (Thurs., SEPT. 22, 2016): A6.

(Note: ellipses added.)

(Note: the online version of the commentary has the date SEPT. 21, 2016, and has the title "Modern Technology Unlocks Secrets of a Damaged Biblical Scroll.")

October 24, 2016

"My Fate Lies with Me, Not with Heaven"

(p. A7) . . . Dr. Unschuld, who is as blunt as he is outspoken, stands at the center of a long and contentious debate in the West over Chinese medicine. For many, it is the ur-alternative to what they see as the industrialized and chemicalized medicine that dominates in the West. For others, it is little more than charlatanism, with its successes attributed to the placebo effect and the odd folk remedy.

Dr. Unschuld is a challenge to both ways of thinking. He has just finished a 28-year English translation of the three principal parts of the foundational work of Chinese medicine: the Huangdi Neijing, or Yellow Emperor's Inner Classic, published by the University of California Press. But unlike many of the textbooks used in Chinese medicine schools in the West, Dr. Unschuld's works are monuments to the art of serious translation; he avoids New Age jargon like "energy" or familiar Western medical terms like "pathogens," seeing both as unfair to the ancient writers and their worldviews.

But this reflects a deep respect for the ancient authors the detractors of Chinese medicine sometimes lack. Dr. Unschuld hunts down obscure terms and devises consistent terminologies that are sometimes not easy to read, but are faithful to the original text. Almost universally, his translations are regarded as trailblazing -- making available, for the first time in a Western language, the complete foundational works of Chinese medicine from up to 2,000 years ago.

. . .

. . . then there is the issue of efficacy. With his extremely dry humor, Dr. Unschuld likens Chinese medicine to the herbal formulas of the medieval Christian mystic Hildegard von Bingen. If people want to try it, they should be free to do so, he said, but not at taxpayer expense. As for himself, Dr. Unschuld says he has never tried Chinese medicine.

. . .

His purely academic approach, . . . , makes him a difficult figure for China to embrace. While widely respected for his knowledge and translations, he has done little to advance the government's agenda of promoting Chinese medicine as soft power. Echoing other critics, he describes China's translations of the classics as "complete swindles," saying they are done with little care and only a political goal in mind.

For Dr. Unschuld, Chinese medicine is far more interesting as an allegory for China's mental state. His most famous book is a history of Chinese medical ideas, in which he sees classic figures, such as the Yellow Emperor, as a reflection of the Chinese people's deep-seated pragmatism. At a time when demons and ghosts were blamed for illness, these Chinese works from 2,000 years ago ascribed it to behavior or disease that could be corrected or cured.

"It is a metaphor for enlightenment," he says.

Especially striking, Dr. Unschuld says, is that the Chinese approach puts responsibility on the individual, as reflected in the statement "wo ming zai wo, bu zai tian" -- "my fate lies with me, not with heaven." This mentality was reflected on a national level in the 19th and 20th centuries, when China was being attacked by outsiders. The Chinese largely blamed themselves and sought concrete answers by studying foreign ideas, industrializing and building a modern economy.

For the full story, see:

IAN JOHNSON. "The Saturday Profile; An Expert on Chinese Medicine, but No New Age Healer." The New York Times (Sat., SEPT. 24, 2016): A7.

(Note: ellipsis added.)

(Note: the online version of the story has the date SEPT. 23, 2016, and has the title "Gandhi the Imperialist - Book Review.")

The recently finished book mentioned above, is:

Unschuld, Paul U. Huang Di Nei Jing Ling Shu: The Ancient Classic on Needle Therapy. Oakland, CA: University of California Press, 2016.

October 23, 2016

Working Longer May Result in Longer Life

(p. D1) Retiring after age 65 may help people live longer, says a study published online in the Journal of Epidemiology & Community Health. The risk of dying from any cause over the study period was 11% lower among people who delayed retirement for one year--until age 66--and fell further among people who retired between the ages of 66 and 72, the study found.

Even workers who retired for health reasons had a lower risk of dying, compared with those leaving work at 65.

The benefits of remaining in the workforce occurred irrespective of gender, lifestyle, education, income and occupation, the analysis showed.

Postponing retirement may delay the natural age-related decline in physical, cognitive and mental functioning, reducing the risk of chronic illness, the study suggests.

For the full story, see:

ANN LUKITS. "RESEARCH REPORT; Retiring After 65 May Extend Life." The Wall Street Journal (Tues., May 3, 2016): D1.

(Note: the online version of the story has the date May 2, 2016, and has the title "RESEARCH REPORT; Retiring After 65 May Help People Live Longer.")

Wu, Chenkai, Michelle C. Odden, Gwenith G. Fisher, and Robert S. Stawski. "Association of Retirement Age with Mortality: A Population-Based Longitudinal Study among Older Adults in the USA." Journal of Epidemiology and Community Health 70, no. 9 (Sept. 2016): 917-23.

October 22, 2016

Toy Car Gives Child with Cerebral Palsy Mobility and Control

HauschildMadelineDrivingModifiedToyCar2016-09-11.jpg"Madeline Hauschild, 3, is thrilled to be at the wheel of her modified toy car at the UNMC Student Life Center on Wednesday [August 10, 2016]. Cars such as Madeline's enable children with little mobility to get around without feeling reliant on parents or siblings." Source of caption and photo: online version of the Omaha World-Herald article quoted and cited below.

(p. 1B) Now Madeline Hauschild will be able to drive a toy car just like her brother.

On Wednesday [August 10, 2016] Madeline, 3, received a battery-operated toy car modified so that she could sit in it and make it go forward by pushing a large button on the steering wheel. Madeline, who has cerebral palsy, was one of six small children who received cars through a program overseen by the University of Nebraska Medical Center and Children's Hospital & Medical Center.

. . .

The cars give children with little mobility the opportunity to play, explore and socialize rather than feeling stuck and dependent on parents or siblings to move them around.

. . .

(p. 5B) Cerebral palsy is a disorder that causes movement, posture and other developmental problems. Among Madeline's challenges: She can't walk or bear any weight on her legs.

Madeline, of Syracuse, Nebraska, smiled and pounded the button, giving her a herky-jerky ride.

. . .

"Is that fun?" Madeline's mother, Kelly Hauschild, asked as her daughter enjoyed the erratic drive in a room at UNMC's Student Life Center. "You do like it, don't you?"

. . .

"I loved seeing her be able to operate it all by herself, and her smiles," Hauschild said.

For the full story, see:

Ruggles, Rick. "Toy Cars Give Kids Vroom to Maneuver." Omaha World-Herald (Thurs., Aug. 11, 2016): 1B & 5B.

(Note: ellipses, and bracketed date, added.)

October 21, 2016

Firms No Longer Need Middlemen to Help Find Factories to Make Their Products

(p. B6) The migration of shoppers online has been squeezing profits throughout the retail industry--including at Li & Fung Ltd., one of the world's largest factory middlemen.

The more than 100-year-old company, based in Hong Kong, contracts with 15,000 factories globally to make apparel, toys and other goods. Its core business has been connecting Western retailers such as Abercrombie & Fitch Co. and Target Corp. with factories around the world.

But as consumers increasingly shop online for the best deals, retailers have been forced to offer lower prices, putting pressure on factories and intermediaries alike.

Middlemen need to "either figure out ways to create value, or they will be going out of business," said Edwin Keh, chief executive of the Hong Kong Research Institute of Textiles and Apparel. "The bigger question is whether middlemen can still exist in a globalized economy."

For the full story, see:

KATHY CHU. "Shift to Web Hits Factory Middlemen." The Wall Street Journal (Fri., Aug. 26, 2016): B6.

(Note: the online version of the story has the date Aug. 25, 2016, and has the title "Lower Retail Prices Threaten Profits of Middleman Li & Fung.")

October 20, 2016

Gandhi in South Africa Was Willing to "Acknowledge White Supremacy"

(p. C6) At the close of his presidency in 1999, Nelson Mandela praised Mohandas Gandhi for believing that the "destiny" of Indians in South Africa was "inseparable from that of the oppressed African majority." In other words, Gandhi had fought for the freedom of Africans, setting the pattern for his later effort to liberate India from British rule.

Nothing could be more misleading. Gandhi's concern for the African majority -- "the Kaffirs," in his phrase -- was negligible. During his South African years (1893-1914), argue Ashwin Desai and Goolam Vahed in "The South African Gandhi," he was far from an "anti-racist, anti-colonial fighter on African soil." He had found his way to South Africa mainly by the accident of being offered a better job there than he could find in Bombay. He regarded himself as a British subject. He aimed at limited integration of Indians into white society. Their new status would secure Indian rights but would also acknowledge white supremacy. In essence, he wanted to stabilize the Indian community within the stratified system that later became known as apartheid.

. . .

"The South African Gandhi" deals comprehensively with Gandhi's decisive two decades in South Africa. It complements Perry Anderson's "The Indian Ideology" (2013), which explains how Gandhi later treated the Dalits, or Untouchables, much as he had dealt with black Africans.

For my taste, the book's tone is too academic, but the authors use sound evidence and argue their case relentlessly--Gandhi's vision did not include the majority of the people in South Africa, the Africans themselves.

For the full review, see:

WM. ROGER LOUIS. "Gandhi the Imperialist." The Wall Street Journal (Sat., Jan 9, 2016): C6.

(Note: ellipsis added.)

(Note: the online version of the review has the date Jan 10, [sic] 2016, and has the title "Gandhi the Imperialist - Book Review.")

The book under review, is:

Desai, Ashwin, and Goolem Vahed. The South African Gandhi: Stretcher-Bearer of Empire. Stanford, CA: Stanford University Press, 2015.

October 19, 2016

Uber Drivers Learn to Work Optimal Hours

(p. B1) For nearly 20 years, economists have been debating how cabdrivers decide when to call it a day. This may seem like a trivial question, but it is one that cuts to the heart of whether humans are fundamentally rational -- in this case, whether they earn their incomes efficiently -- as the discipline has traditionally assumed.

In one camp is a group of so-called behavioral economists who have found evidence that many taxi drivers work longer hours on days when business is slow and shorter hours when business is brisk -- the opposite of what economic rationality, to say nothing of common sense, would seem to dictate.

In another camp is a group of more orthodox economists who argue that this perverse habit is largely an illusion in the eyes of certain researchers. Once you consult more precise numbers, they argue, you find that drivers typically work longer hours when it is in their financial interest to do so.

. . .

So who is right? That's where Uber comes in. When one of the company's researchers, using its supremely detailed data on drivers' work time and rides, waded into the debate with a paper this year, the results were intriguing.

Over all, there was little evidence that drivers were driving less when they could make more per hour than usual. But that was not true for a large portion of new drivers. Many of these drivers appeared to have an income goal in mind and stopped when they were near it, causing them to knock off sooner when their hourly wage was high and to work longer when their wage was low.

. . .

"A substantial, although not most, frac-(p. B5)tion of partners do in fact come into the market with income targeting behavior," the paper's author, Michael Sheldon, an Uber data scientist, wrote. The behavior is then "rather quickly learned away in favor of more optimal decision making."

In effect, Mr. Sheldon was saying, the generally rational beings that most economists presume to exist are made, not born -- at least as far as their Uber driving is concerned.

. . .

As for Mr. Sheldon, the Uber paper's author, he attributed his finding to the adventurous nature of many Uber drivers, who were open to running headlong into unfamiliar territory. It's the sheer unfamiliarity of the Uber driving experience, he speculated, that may explain the initial bout of economically irrational behavior.

Mr. Sheldon was less open to the idea that people who did not depend on Uber for their livelihood helped account for his finding. So far as Uber can tell from other research, he said, those who drive irregularly respond more to fare increases than more regular drivers, at any level of earnings.

For the full story, see:

NOAM SCHEIBER. "Are Uber Drivers Rational? Not Always, Economists Say." The New York Times (Mon., SEPT. 5, 2016): B1 & B5.

(Note: ellipses, and bracketed date, added.)

(Note: the online version of the story has the date SEPT. 4, 2016, and has the title "How Uber Drivers Decide How Long to Work.")

The working paper by Michael Sheldon mentioned above, is:

Sheldon, Michael. "Income Targeting and the Ridesharing Market." Working Paper, Feb. 18, 2016.

October 18, 2016

Faster, Stronger 3-D Printing Method May Be Better for Manufacturing

(p. B1) Ford Motor Co. is experimenting with a new form of 3-D printing the auto maker says could solve a structural flaw that has kept the technology from widespread use in manufacturing.

The ability to "print" parts within an assembly plant would drastically reduce transport and logistics costs for the auto industry, where car makers must source parts from dozens of suppliers around the world. But the most widely used version of the technology is ill-suited for mass production because objects are printed layer by layer, a slow process that also creates tiny fault lines that can crack when stressed.

A startup backed by Alphabet Inc.'s Google Ventures is developing a different 3-D printing method that some manufacturers, including Ford, say shows more promise. Carbon3D Inc.'s printers project light continuously through a pool of resin, gradually solidifying it onto an overhead platform that slowly lifts the object up until it is fully formed. The process takes a fraction of the time of other printing methods, and forms solid items more similar to those created using conventional auto-part molds, said Ellen Lee, who leads a 3-D printing research division at Ford.

For the full story, see:

LORETTA CHAO. "Fast 3-D Printing Earn New Respect." The Wall Street Journal (Tues., April 26, 2016): B1 & B4.

(Note: the online version of the story has the date April 25, 2016, and has the title "Auto Makers, Others Explore New Roles for 3-D Printing.")

Eight Most Recent Comments:

Ed Rector said:

There are more than 2000 colleges in the USA offering tens of thousands of degrees/majors. Oh yes, there are also a few thousand JC's, trade schools and apprentice programs that train welders. Who should decide what any individual student wants to study?? Senator Rubio, the Mercatus Center or the individual student?? And you call yourselves 'freedom-loving Libertarians' !!

Aaron said:

You need a "like" button. Here's to enjoying bacon and eggs on an unusually warm fall day and doing so guilt free.

Aaron said:

I'd also suggest that work is just part of who some people are and a reason they got rich. A friend's dad comes to mind; he's a millionaire and in his 60s and a couple years ago I saw him cleaning one of his rental houses and wondered why he didn't pay someone to do it, but he's just one of those guys who'd rather work than golf or relax.

Jim Rose said:

It is often forgotten that the Minister for International trade and industry in the late 1960s up until 1971 was Tanaka – the most corrupt man in postwar Japanese politics. He had previously been Minister for Public Works, but to generate the necessary bribe income to pay an entire generation of Japanese politicians to step aside to allow him to become Prime Minister in the early 1970s at a young age, he thought the Ministry of International trade and industry was a better position to garner influence and donations. My professors in Japan worked in the Ministry of International trade and industry and the Ministry of Finance in the 1970s and 1960s. None of them seemed to carry over their picking winners skills into their private portfolios when they retired. see http://utopiayouarestandinginit.com/2014/03/14/if-you-are-so-smart-why-arent-you-rich/

Aaron said:

Interested to see how not only did Hamilton gain a vote, but also how Jefferson lost one.

Dave Megan said:

Merging of companies is always better when they have a better goal. It will give better service for the public.

Ed Rector said:

The 'quickened pace of production' of the early Reagan years was directly attributable to RR's massive deficit spending. The national debt almost tripled under the watch of St. Ronnie. BO will have to work overtime to even approach this record of accomplishment.

Aaron said:

The last two paragraphs comport perfectly with what Paul Tough describes in a book you posted on a few months ago, "How Children Succeed." Tough advocates that a stable, loving relationship between kids and their parents, especially in the first few years of life, produces self-assured and less anxious adults due to brain formation or chemical reactions that take place in a baby's brain (simplified summary). As always, appreciate the posts, especially the Paul Tough book.



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