A conversation with Léo Apotheker and Andrew Mcafee

with Andrew McAfee and Léo Apotheker
in Current Affairs, Business
on Tuesday, January 6, 2009 * * * * *

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A conversation with Léo Apotheker, co-CEO and a member of the Executive Board of SAP AG and Andrew Mcafee of the Technology and Operations Management Unit at Harvard Business School

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Obama
economy

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    1. KMGuru  01/09/2009 06:10 PM Report

      I suppose as a old man from the dawn of the microprocessors, and now kicking around with artificial intelligence for the next generation computing, I did not make myself clear on cloud computing. Infoworld says:

      As a metaphor for the Internet, "the cloud" is a familiar cliché, but when combined with "computing," the meaning gets bigger and fuzzier. Some analysts and vendors define cloud computing narrowly as <b>an updated version of utility computing:</b> basically virtual servers available over the Internet. Others go very broad, arguing anything you consume outside the firewall is "in the cloud," including conventional outsourcing.

      And so it is!

    2. Questionmark  01/09/2009 05:14 PM Report

      A lot in common regarding the opinion of KMGuru ReMant. However I don´t agree with such a statement regarding the cloud computing. This is a kind of "old man" standpoint that we did this already earlier somewhere and somehow. Just because there is a similarity in the solution concept this doesn´t mean that the issue the concept is applied to is necessarily the same. Good concepts can be applied on a lot of problems, but not every problem can be solved with the same concept. The explanantion from Mcafee was not that bad. I agree however very much with the opinion of REMant that we are lacking fundamental engineering skills and engineering focus especially in business management It´s a myth that management is just lacking the access to data or have data shown in the right analysis, whatever this would mean. My experience working 20 years in business development in software is that most managers are neither interested nor able to understand even the easiest technical or business coherences. This is not astonishing however, they focus on that what they are really interested in - climbing up the career ladder as much as they can - and this has nothing to do with business skills. Most Senior Managers are expecting from software the same skills and deliverables like from their employees - to solve and fix the issues they are not interested in or are not able to do so. Because they want to focus on the really important things - salary, reputation, etc. - they like to be superstars like most people - if they deserve it? - who cares? - Like most people.

      BTW - Neither Mr. Apotheker, nor Mr. Mcafee belong to this kind of species - but exceptions proof the rules

    3. KMGuru  01/09/2009 04:15 PM Report

      Excellent interview. I was disappointed Mcafee’s explanation of “Cloud Computing” as if it is a new thing. The old IBM mainframe service was the cloud computing with a terminal at the customer’s location. Now we are trying to go back to it as a service. It is the old wine in a new bottle that young nerds would not remember.

      As to SAP’s products, there is definitely a problem when everybody has the same product meaning their business process will be basically the same. In this environment, it is hard to innovate and compete. And if you try to customize SAP, they frowns upon and is very expensive. SAP is like German automobiles, solid product but when it breaks (your business process) it is very expensive to fix, and you are married to that process. “Innovative best practices” is an oxymoron. Also SAP software runs the back-office and not the controllers that do actual manufacturing or chemical processes. But most production companies spend so much on SAP, Oracle type ERPs that they do not have the money to spend on the actual production automation or do the Innovation. At least in the USA that is the problem, which reduced our real productivity. Therefore, companies had to move offshore to get cheap labor. By the way, Wal-Mart uses a proprietary application and technology for their operations that their competitors do not have a clue.

      It is not SAP’s fault, but large businesses get so comfortable in their standardized Business processes that there is no room to adapt. The agility factor goes out the window. Most CEOs and upper management have extreme difficulty slicing and dicing the information from their own database. So, they depend on the lowest level employees called Business Analysts to provide the requested reports. It is like a General asking the lowest level one single soldier to provide the information so that the general can conduct strategic and tactical war operations for his country. You know how that works!

    4. REMant  01/07/2009 04:50 PM Report

      The problem here is not really the absence of software. The ideas involved have been available for centuries and taught in B-schools for decades. The main problem is that bureacracies, both public and private never look at the data, unless, perhaps, they are in finance. The second problem is the difficulty of estimating the mkt as a whole. To a large extent, it is not the presentation of the data, but the development of decision-making methodology, which is needed. Many of the techniques for this were developed in the second world war, and have roots much further back. The Federal govt, tho, and probably a lot of state and local govts have a desperate need for any kind of IT that works. This "cloud" nonsense is nothing more than the usual business technique of trying to make a product into a service, whereas engineers try to make a service into a product. Converting everything into a service is dangerous precisely because it bureacratizes it. There is in marketing theory, something called "the wheel of retailing" which refers to a cycle of businesses starting out slim, trim and focused, and then becoming bloated trying to be everything to all ppl - actually a take on Polybius. It seems to me something of this sort is applicable to this issue. We need the engineers and their products to counter the propensity to stagnation inherent in over-management. Overall, I'd say it is the loss of our engineering ability that has contributed to the present problems rather than the absence of managerial efficiency.

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