Finding the Balance: Anonymity and Erasability

Anonymity on the internet is being threatened. Websites, specially e-Commerce sites, facing perception of astro-turfing are increasingly insisting on users to reveal themselves before narrating their experiences. These sites are requiring users to either log-in or be authenticated using their Google+ or Facebook credentials before speaking out their mind.

One of the biggest advantages of Internet was that it enabled individuals to interact anonymously. You could speak whatever came to your mind without fear of any retaliation or ridicule. This was best illustrated by Peter Steiner in his 1993 cartoon

This freedom, unfortunately, came with a rise in vitriol, threats delivered anonymously, and open display of downright uncivil and asinine behavior.  Social media took this to a whole next level.

As users went online for their default interactions in daily life, businesses woke up to the great potential of knowing every intimate details of behavior of their users in order to derive a competitive advantage. In that process they also became aware of the damaging potential caused due to amplification of even one single adverse comment. ( my post: There is A Lot Riding on those Stars). A dissatisfied customer faced a fine  of $3500 by a website for posting a negative comment, years ago. An absurdity? You bet!

This was collateral fallout of the interactive Web2.0 that records everything.

Clearly, the ground is shifting toward diminishing the level of anonymity in order to “customize” and serve the customer and the community “better.”  Pundits have hypothesized that revealing identity causes us to self-enforce social behavior online.

"Most individuals try to present themselves online the way they think society is expecting them to”

Today it is not a hyperbole to state that we are standing naked in the glare of data collection at an unprecedented scale and the “big data.”

Challenging Permanency of Everything 

 

Meanwhile, another movement in a different direction has been taking shape at the same time.  

Teens (in US and Europe) are not spending as much of their waking hours on Facebook. The social networking giant does not seem to be “cool any more”.

They have been using other means that may appear more “private” to communicate between themselves. The sudden popularity of services like Snapchat, where your messages live for a very short time, is a testimony to this trend.   

Earlier the youngsters found that their unbridled posts on Facebook were being used by hiring managers to “judge” their actions adversely.  

Recently Farhad Manjoo (+Farhad Manjoo), an analyst at Wall Street Journal,  ventured  that this is beginning of a demand for an erasable Internet. So long as “data persists,” is "indexable", and is “easily accessible”, it will be used, no matter what.

Balancing the Two?

It makes sense to see both the developments going hand in hand.  Informal conversation and chat between friends are supposed to have very short half-life. These are not supposed to hang in the air like an unmoving cloud.

A permanent repository of all conversations, being capable of being played back or accessed at a moment’s notice, is a perfect antidote for enduring relationships. It is for a reason that human memory is capable of filtering out casual interactions or impetus behavior, retaining things that have longer, lasting impact.  

So if you take the anonymity away from Internet, it stand to reason why anyone would want  internet to be erasable. If connecting the large number of disparate dots is acceptable, then people would want fewer of those to exist to be connected.

Ecommerce: Fueling expectations, Pampering Customers

The always-on internet enable your e-commerce store to be kept open 24/7, in the hope of not missing that straggling prospect, anywhere at any time of the day.  There are no restrictions, or necessity of  dropping the shutters or of turning the lights out.

In addition to freedom to shop anytime, your avid website shopper balks at paying the shipping cost.  The concept appears alien since the person has never paid for shipping at the neighborhood supermarket.  Amazon ate a whooping $4B in shipping cost last year in order to remove this friction from online shopping experience.

Speed and timeliness of delivery is the next big thing. Large online retailors are locating warehouses closer to customers to cut down on the delivery time (and hoping to reduce some cost).  Same-day delivery will surely be giving way to same-hour delivery. Soon drones may be taking to air to set our last minute Holiday purchases in our front yards. The expectation will be to go Full Monty and expect deliveries on weekends including public holidays too!

Choices? No problem. Some e-retailers  will ship you three variations. You can select the one you liked and return the other two without any hassle.

How far will this go? The next target will be the customer support. Soon the round-the-clock shopper will expect live support at any time of the day. If the shop can be kept open at all hours, why will support not be manned anytime a customer needs it?

And least we forget, the prices must remain most competitive (read the lowest) along with all other frills. It is not unusual to see “we beat internet prices” at stores who are bravely battling the challenges of heightened customer expectations.

Add to this the fact that acquiring the first customer has become so expensive that it wipes away any profits.  E-commerce businesses now hope to make money with returning customers. Some call it the Critical Second Sale.  Returning buyers, the study found, generated 41% revenue and 100% profits. 

This imposes additional overheads of building brand loyalty (a difficult thing to do with everything just a click or a review away) and cajoling the customer to order again.

E-commerce Customer is the King

Surprisingly all this coddling has only served to increase customer dissatisfaction. A study , conducted by Arizona State University this year, found that customers reporting problems have gone up from 32% in 1976 to 50% in 2013. Yelling at customer support has increased as well, and dissatisfied customers have been talking about their pain to 28 other persons (on an average)!

This outburst reported by Gawker, on Facebook by a customer, and its response by the company, is an indicator of runaway expectations.

With the best prices on consumer goods along with all the shopping conveniences,  why is dissatisfaction growing?

The vivid stories of fights and scenes of violence that broke out in some superstores on Thanksgiving night this year is still fresh in the memory. The physical stores opened in the night because they were afraid of the advancing e-commerce juggernaut, that never sleeps!

I know this is swimming against the tide but I cannot help thinking that online shoppers never had it so good before.

Clearly customer is in the driving seat. But the engine should be in good shape to take you wherever you want to go

Hiring From Social Media Free Zone

In a story filed by Kristina Wong (+Kristina Wong), of Washington Post, General Martin E. Dempsey, Joint Chief of Staff, told the youth yesterday, about giving them a “shot to start over.”  He was referring to the fact that the teens have been reckless in posting information about themselves on social media, and those posts would potentially shoot down their chances of joining the armed services.

With his advise, the General joined the ranks of scores of hiring managers in enterprises, both large and small, in using social media content to filter out prospective job applicants. General Dempsey, the article stated has been "voicing frustration" of  employers. Now some colleges are also following suit in rejecting applicants, should the prospective freshman tweet or post anything that may be deemed offensive!

Something (or someone) is out of tune in all this!

Social networks have opened up sharing in a big way and encourage it actively. User generated content acts, both like a honeypot and epoxy to grow and hold the network together. Society encourages this behavior. This is evident from swelling of social network’s audience and its widespread reach. The large market cap and huge valuation of these networks is a clear stamp of society’s approval.

Given this mark of confidence in social sharing, why do our hiring managers and enterprises hold social content posted by an individual for disqualification (assuming that the content is not illegal)?  Youngsters engage in behaviors grown-ups perceive as wild, outside the norm and disruptive.  Not much appears to have changed since 2010 when I wrote about this issue (Hiring in a social world: Rise of unequal Opportunity Employer). Employers have not devised norms to cover social media activities, and leave this completely to their subjective judgment.

Are the hiring practices that treat sharing as "overexposing", going out-of-date with this generational change while youth have moved ahead! That probably is the source of frustration.

Should companies, including Army, look for recruits who grew up and are in Facebook-Twitter-Snapchat-Pinterest-Instagram-Vine free zones? Or should they limit hiring from youth who shun sharing , no matter if they have the chops for the job or not.

Healthcare.gov: Growing Traffic Pushing Limits

December 1 was the deadline prescribed by the President, to get the Healthcare.gov website back to health, and not get dizzy as soon as users start flocking to the e-commerce site. 

With fixes in, now some are blaming the site to be too fast!

According to new performance level the website needs to be able to handle 50,000 concurrent users at a time, and up till 800,000 users every day.

The website traffic...is growing

 

There are no official stats available on the website traffic to healthcare.gov. 

However, some tools in the public domain have estimated growth of traffic in the last few months. Before we pore over their charts, a word of caution. The data from these services have been estimates, usually on the lower side that the actual traffic, and their accuracy may vary widely. So proceed with caution...

With that caveat out of the way, let us look at what some of these tools are telling us.

Compete is used by most of the digital marketing gurus. Their estimates show:

 

the website experienced a hockey style type growth, moving from 2.36M visitors in September 2013 to 10.8M by end of October.  This translates to 360,000 visitors every day. 

The next is Quantcast another popular site. Their estimates have been on a more conservative side

Healthcare.gov attracted almost 2M (1.195M) visitors in August, rising to 2.79M in September but could reach only 6.3M in October. They estimate that the growth has been slower and rise has been gentler. 

Note that the two estimates differ widely for October. November data is yet to be in.

Alexa has a different story to tell.

Alexa, however, only assigns ranking to websites based on a combination of visits and page views. Alexa has assigned a rank of 549 to healthcare.gov (lower the number higher the traffic). For comparison Google, Facebook, Youtube, Yahoo and Amazon hold the ranks 1-5. aarp.org holds rank 500 in the US. 

For a quick context Google (Alexa Rank 1 fielded 178M visitors in October 2013).

Emerging website visitors profile

Alexa has some other interesting stats. They estimate that the website has only 21% bounce rate in October. Either the user are determined not to give up or the website has been responding well.

Users have been spending on an average over 6.14 minutes on the site- another sign of stickiness; an average page view of almost 7 pages per visit (lots of browsing going on).

The brief demographic profile shows relatively many more women than men have been visiting healthcare.gov.  Maybe women are more concerned about affordable healthcare plans or maybe they have more patience with e-commerce.

This may have implications for Democrats. Women have been traditionally favoring the Democratic Party.  If they get disenchanted because of frustration in getting the right health insurance plan through the website, they may express their disapproval at the ballot. Note that Obama has 12% lead among female voters against his Republican rival in 2012.

We see that relatively more users who have some college have been visiting healthcare.gov website.

 The stress test is coming

The website is going to face more stress in the months to come. It was handling traffic at half way mark of 800K daily visitors, by the end of October 2013. Keep in mind too that the real test will be when 50,000 users would be able to find their plan and complete the application concurrently.

 

 

 

Rank or Yank: Problem for one but Solution for the other!

This week Stack Ranking system shot up to the top of the news, when two large tech companies, Yahoo and Microsoft, took opposite stands, on this (controversial) employee performance system. Stack Ranking is an HR practice that is resorted to, for putting employees into pre-defined buckets to identify the “C” level workers.

GE Famed Forced Ranking System

Microsoft, that has taken some heat, and has been flayed in the media for following this practice, announced that it is moving away from this form of force fitting. Yahoo, on the other hand, decided to adopt this system and walked into HR Crosshairs.

These developments added fuel to the fire, reigniting the debate once again. The question being asked is that whether this system, introduced by Jack Welch, back in 1980 at GE, is still useful in today’s workforce environment. Remember that the workforce in US has moved steadily away from manufacturing. Today it is turning into predominantly knowledge based force. GE, since then, has abandoned this system of performance evaluation.

Are tech managers up to the task?

There is, of course, plenty of ammunition on both sides to go on. Some HR advocates take the view that the forced stacking system is sound, but is not being implemented properly. Others believe that embracing the system is symptomatic of incompetency in the middle management, in that the managers are unable to coach “under-performers.” This highlights the point that often the goals are not set well, or there is a strong element of subjectivity in evaluation. It is not unheard of that employees try to game the system where "anyone's loss is your gain." 

However, the proponents of this system concede that this should be used only for a short time.

In tech companies this problem becomes exacerbated since SMEs often rise to the position of managers. More often than not, they have no training or skills in talent management.

One of the issues with the forced stack ranking is that it tends to fit the employees on a standard “bell curve” – with a leading edge of top performers, most in the average “meets the expectation” category, and the trailing edge of under-performers, who would be on the chopping block.

The “bell curve” is a representation of a “Normal Distribution” or “Gaussian Distribution” in statistics. Like many things in life we tend to fit most “occurrences” into a “bell curve.”

Does Talent Follow the Bell Curve?

There is some belief that things in nature follow the Pareto Principle, or its more popular moniker- the 80/20 Rule. Scientists have shown that this behavior has been pervasive and, has been observed in both natural and man-made artifacts. This distribution has been found to exist in place as diverse as in social networks, biology, urban planning, website visits, political landscape and other sociological phenomena.

The 80/20 Rule: Note the steep fall

This distribution has been recognized to exist in workplace also, where we all agree that 80% of employees in any team deliver only 20% of the work.

A typical Pareto curve shows a tall head that drops quickly and sports a long tail. It has been found that the long tail of a Pareto Curve persists far longer than a trailing edge of a “bell curve.”

A Company of Super Performers

This does not mean that if a company fires 80% of its work force and hires instead, few super-workers, it will turn into a hyper-performing company.  We are yet to see the rise of such a super company that has only the highest performing employees. 

Maybe it is time that the HR Gurus need to consider the implications of Pareto Principle in workplace, and suggest an alternative approach to the forced staking into a bell curve. Note that a stacking system focuses on individuals over the team. The emphasis is growing on work collaboration where output is often highly interdependent. 

The 21^st Century workforce that is rapidly transforming into knowledge workers engaged in a flatter system will demand such a change. We see than in Generation Y whose expectation at the work place is very different from the one just two decades ago.

Organizations, that are agile at the cutting edge, have a different problem to solve. In their case innovation drives the growth.  This often requires flashes of genius with a team to do the quick operational heavy lifting. More often than not, innovation is not a big bolt from the blue, but a series of little flashes that need to be tested quickly and discarded if need be.  

In such organizations morale is the key. Talent usually does not indulge in game playing to beat the staking principle and, if the atmosphere gets murky they are the first ones to leave.

Will Bing soon be looking for a new parent?

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Businessweek reported that the potential Microsoft CEO candidate, Stephan Elop,

“…would consider ending Microsoft’s costly effort to take on Google with its Bing search engine, and would also consider selling healthy businesses such as the Xbox game console if he determined they weren’t critical to the company’s strategy,..”

 

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Maybe just a Test Balloon?

At this point this could just be second guessing, based on the opinions of some people who are said to be familiar with Elop's thinking. Search experts, however, were quick to analyze such a move. +Greg Sterling  made some great arguments here.

One obvious speculation was to whom Microsoft could sell Bing to!

+Danny Sullivan, of Search Engine Land held the view that Bing is too strategic for Microsoft to “just walk away” from the search engine. Bing is deeply integrated with the Windows Phone and other Microsoft products.  In his view it would be too disruptive for Microsoft to disengage from Bing. 

Yahoo and Apple are the two names being bandied about. 

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Possibility of search engines overseas, like Alibaba, Baidu and Yandex  acquiring Bing is being mentioned. This does make some sense, since the next (and potentially explosive) round of growth in Internet will come from Asia (and Africa). Along with more people accessing Internet, demand will rise for search engines that are better customized to the regional needs (my earlier post).

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But Competition also spawns Innovation

Competition is another reason why Bing needs to exist. Healthy rivalry does not let players sit on their hunches. It spurs the urge to innovate and to do better. Blackberry learned that lesson too late.  Microsoft’s Web Based Office 365 (and recently announced real-time collaboration), are two current examples.

 Note the differences between how Bing and Google describe Bing

 The problem that is generally associated with Bing, is that it continued, for far too long, into “me too” mode, trying to grow by doing the similar things as Google. It did not create much deeper differentiation.

Bing found it difficult to shake off those colors!

 Where search engines have not gone before

Search is one of the fundamental processes of discovery. But it is, by no means, need to be uni-dimensional.   

Facebook is proving this by building their Graph Search. By thinking differently, Bing could grow into other, less explored frontiers in searching, area that will be as natural as Googling something today.   

It is not that Bing lacks the brainpower to step into the unchartered waters. It is their managers that lacked the will (or vision) to venture forth.

Non-Profit today? Intrepid Profit-Maker Tomorrow?

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A few days ago, I wrote (Amazon: In Future We Trust) about the unshakable confidence the financial backers have, in Amazon’s future, despite the company appearing as an enigma to its investors.

There are all shades of opinion on Amazon’s financial performance, ever since it started selling books online, in 1995.  People, on both sides of the divide, have carried out forensics of the company's financial data, and have been offering their views. It was natural for this debate to heat up more after their Q3 earning report, showing sharp growth in revenue with losses.

At the heart of the debate is this chart:(courtesy Benedict Evans)

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This trend prompted +Will Oremus  of Slate to wonder if Bezos Midas Touch has been working in reverse.  He was reflecting the sentiments of another Slate fellow  “Matthew Yglesias earlier this year: "Amazon, as best I can tell, is a charitable organization being run by elements of the investment community for the benefit of consumers."

It is difficult to deny the strange alchemy for investors, where their gold is getting converted into…consumer happiness!

Both Rabbit & the Hare

 

The defense has not been less vigorous. +Eugene Wei in his riposte, dissected the assertion of the “profitless business model.”  He has expressed confidence that Amazon’s business is profitable, whether in retail or in the platform, and that we should be looking deeper into metrics like Free Cash Flow. He admits that these questions are arising due to the opacity surrounding Amazon’s accounts.

“Part of this problem comes from the limited visibility into the dynamics of its business finances. Why doesn't Amazon break out more detail in its financial reporting to help the external world understand all these intricacies”

He justifies privacy of this veil, by asserting that tech companies avoid disclosing details to investors because they have “an interesting ambivalence towards the public capital markets. They rebel against resource dependence theory because they don't believe their investors know how to run their businesses better than they do, but on the other hand, being public is a great boon to compensating knowledge workers who have a lot of job options.”

While this view is not devoid of its own share of minefields, the one that stands out, is that the tech companies he is comparing Amazon with, Google and Apple, have been making solid profits, besides growing both their market and technology.

Mastering Investor's Sentiments?

This issue is not about what Amazon or what its charismatic CEO, Jeff Bezos, is attempting to do.  This is more in the investor's domain.  They are buying into a promise that at some (as yet indeterminate) time in future, Amazon will stand tall and fearless, without competition, with big profits- a vision drawn more by investor’s inferences than by any public statement by the company’s CEO or its Board. 

It is not often that Wall Street reposes so much of confidence in a tech company for 18 years!

While this debate will rage on, quarter after quarter, Jeff Bezos will continue on the path to build something like an e-Commerce Operating System at a Global level, and, continue to distribute happiness to its customers.