Tag Archives: Business

Where I See The Sharing Economy Going

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I’ve been beating up pretty harshly on Uber and in some of my past posts I’ve done something similarly to other members of the sharing economy. This is because there’s an attitude of entitlement in some of their behavior, that being said the incumbents pretty much the exact same way and have worked to institute laws to protect themselves. In some cases the laws that are preventing Uber and AirBnB from effectively entering new markets were put in place to protect customers FROM the incumbents. Which means that Uber needs to work to ensure that their drivers meet those same requirements, which I think is a good thing.

So that being said, where will these companies end up in the next few years. Now this, of course, is pure conjecture, but I think it’s somewhat informed. Based on the types of lawsuits we’re seeing from cities like Portland, countries like France and Spain, we’re likely going to see that Uber is going to have to work more with the governments before moving in. These lawsuits are expensive and too many of them will drain the startup’s coffers where it might negatively impact their ability to do business. So instead of just forcing themselves into a given city they will work with community leaders to effect change of policy. They will start to institute their own rules that will lead to inspections of the cars at random intervals, they will begin to add a great deal more of measures that the riders will be able to rate the drivers on. All of these will be analyzed using BIG DATA and will be used to help show that Uber meets the requirements of various governments.

As these companies mature they will begin to look more like incumbents and start to drive policy creation through lobbying while striving to use their data to support their lobbying efforts. They will start to work prevent other competitors moving into their spaces, leverage their monopolies to move into other spaces and generally mature as an organization. Through these missteps they will create internal policies focusing on how to manage their data and implement processes to prevent data abuse in the future. These startups will need to clearly become data stewards as they mature, because they live and breathe data.

I think it’s likely that Uber is going to begin experimenting more and more with other modes of transportation, for example they are partnering with Carpooling to help bring that service to the US for long distance ride sharing. With the amount of money that Uber has in the bank, it’s likely that they’ll look to acquire this company if the partnership is successful. I could see them getting into RV sharing and then potentially trying to compete head on with AirBnB – that last one is a bit of a stretch, but with a huge pocket full of cash they will definitely be able to take a great deal of risks to experiment in new markets once they have operations in major cities across the world. I’d be willing to guess they’ll continue to use the US as an experimental test bed and while deploying more mature offerings across the world.

In my next post I’ll dig into where I think AirBnB will go with their business.

Uber might be crashing back to Earth

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Last Friday Uber decided to start operating in Portland. I know, it’s a little surprising that Uber or any of the other rideshare Taxi apps aren’t already in the city. Portland had told Uber they could not operate in the city, but Uber decided to thumb their nose at that similarly to what they have done in other cities. Even though Uber was recently valued at $40 Billion they have had some serious issues lately, like rape of a woman in Delhi while illegally operating in the city. Furthermore, as I mentioned in my last article, they have smeared women journalists with the data Uber collects.

Portland has decided to sue Uber over their illegal operation within the city. The city is following Nevada in suing the company rather than trying to fine their drivers. Uber has since ceased operations in the state due to an injunction against the company operating in the state. This appears to be the only route that will work effectively as Uber is still operating in Delhi despite the citywide ban of the service. Uber has also been banned in Spain, Thailand, and parts of the Netherlands. I think the biggest blow, however, is the fact that both San Francisco and LA are suing the company for false advertising related to their fees and background check.

These responses should not come as much of a surprise to anyone that has been watching the company over the past few years. The company is part of the Silicon Valley culture of going fast and trying to break things. The problem is that, incumbents are incumbents for a reason and they do have the ear of government. It’s not to say that they should be incumbents or that it makes them something worthy of respect, but you need to understand the cards are stacked against you. In cases where you want to go in and intentionally ruffle feathers, you must have strong safe guards in place to protect your customers and be public about how you protect them. Uber should welcome background check audits, privacy audits, and driver safety audits whenever they go into a new market. These should all be huge features that they brag about and let people under the hood to actually see.

I think it’s time that companies like Uber start treating our data as if it’s Personal Health Information, which is protected by Health Information Portability and Accountability Act (aka that HIPAA agreement you sign at the doctors’ office). The default is to not share personal information about a patient, that if someone is caught looking at the data without just cause, it typically results in a firing and a fine for the organization. Similar action must be taken at Uber to show they are a steward of our data. Now the government won’t be taking that money, but instead they should be donating the funds to a good cause at a similar rate to a HIPAA violation.

In some respect Uber is exhibiting the effects of a company that is growing too large too fast without designing processes to enable their business activities properly. For Uber to be a successful long term company they need to figure out how to both appease city governments through over protecting their users and breaking existing rules. If the company can be trusted then governments will be more willing to accept pushing boundaries.

When we buy something do we control anything?

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In new routers Comcast has decided to enable another WiFi signal that is public, but separate from your network, but still using your data. Initially, you were able to fairly easily turn off the the second network, however, Comcast has started to make it much more difficult. This raises the question in my mind, around if you’re paying for a service, shouldn’t you be able to control what is happening with that service within your house? It also raises the concern in my mind that the second network will use your data cap in the areas that have data caps – and Comcast plans to expand those caps even though we hate them.

Similarly, Uber, has done some pretty horrible things around data privacy of their users. Similarly, Facebook has conducted experiments on their users and what they display. In Uber’s case you buy the service, in Facebook, you pay for it through seeing ads. In each case you do not control anything done with your data once you enter the agreement to use their services.

Apple has been accused, and admitted to, deleting songs added to an iPod by a non-iTunes service. This is even more problematic in my mind than Amazon deleting something from your Kindle, because the iPod is a physical object that you own that was only updated whenever you connected the iPod to your computer. Furthermore, Apple was deleting things you owned without your consent from a product that you own because they didn’t want their competitors content on a product in their ecosystem. It is likely many people didn’t notice because you can have so many songs on the device, but I’m sure some people were confused.

Then there is the “licensing” that happens whenever you buy software, even whenever you buy a physical copy, companies like Autodesk have sued over the right to sell that “license” again. They sued and won over someone selling their physical disks, which is pretty insane, but they wanted to protect their product and claimed that it violate’s their licenses.

In all of these cases, a company is doing something related to a service you purchased without your consent or input into how they use it. Effectively, you don’t really control the stuff you buy. Even though we all feel like we own everything we buy, we really don’t. We don’t have control over the services we purchase and this is going to get worse over time. It will get worse, because software is eating the world, and is now in many more traditional industries like mining equipment manufacturer Joy Mining. Michael Porter wrote a really lengthy article about how software is having serious impact on the future of competition he argues that software will be everywhere and in fact companies need to build the internal capability to create software. As users of these new technologies we need to understand how companies use our data and what control we actually have on the services and products we buy.

Passions

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During Thanksgiving it’s a time for food, family, and watching copious amounts of TV and movies. This year those movies included “Somm” which is a movie about 4 guys trying to take the Master Sommelier test. Which apparently only about 12% pass each year. Not a super low amount, but also not an easy exam in any way shape or form. It got me thinking about if I could become a Somm (as they are called in the business according to the movie). I think that I do have the right kind of mind for the job, remember flavors of wines the history of region of wine and all of that is right up my alley. I know that, because that’s what I used to do with beer. I used to be able to rattle of several types of beers that if you liked one kind or style that might push your boundaries and give some of the reasoning behind it. I was able to explain why a beer tasted the way it did, etc… That was something I loved and was really passionate about. However, wine just doesn’t hold the same level of interest to me. I don’t know if it’s because beer feels much more close to home, my friends drank beer and avoided wine or what it is. Even now that I cannot drink beer I still haven’t really replaced it with a beverage I’m passionate about. I drink both wine and cider, but I don’t feel a deep down passion for them. Likewise I don’t think I could do that with whiskey, even though I really enjoy drinking whiskey, it just hasn’t captured my imagination as a GREAT drink that I want to learn everything about.

More broadly, the movie has had me thinking about what I’m truly passionate about. I know that a great deal of my interests are reflections of what my friends are interested in. If I’m surrounded by people that love watching football, I’ll watch a lot more football, similarly for college basketball or hockey. I enjoy the games when I watch them, but I rarely will seek them out on my own. I think this is something that is driving my wife crazy, I simply don’t have a lot of things that I’m passionate about that I’ll invest a huge amount of time into. It’s frustrating for me too. I think that is probably the hardest thing about me being Gluten Free I’ve really lost a great passion of mine.

I think many people will agree that I’m passionate about certain things in our political system. I’m all about free speech, investing in science and technology to grow and enable our economy. But I’m also not 100% all in. I’ve been thinking about how to get involved and in what way I’d do this. Ideally, I’d work at a think tank, but there aren’t many around Portland and many of them are either left wing or right wing. I think on many topics I’m a moderate, so neither party truly inspires much confidence.

I’m also passionate about making people’s lives better at work, but I’m not really getting much support at my organization and I’m getting beaten down. It’s one of the most frustrating things you can deal with on a daily basis, knowing there’s a better way to do things, walking your leaders to the kool-aid, but seeing them spit it out and start drinking from the mud instead.

So this leaves in an odd position. The things I’m passionate for I can’t really follow through, which makes me ask What do I have passion for, what should I try to be doing to find things I could become passionate about, how should I act on the topics I do have passion for? I know that there’s something more out there that I could or should be doing, but i have no idea how to get there.

What should a manager manage?

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Managers should not be managers of people, they must manage processes. Managers should be leaders of people not managers of people. Managing people by watching them closely is not typically a very effective method to ensure that work is completed. Micromanagement breeds mistrust between employee and manager. Through managing the quality of the processes the manager is able to increase the likelihood of success of their people.

All work is a process. Even if there doesn’t appear to be a process if the work is to be fully completed there are a series of steps that must be completed. It doesn’t have to be a good process, a repeatable process, or particularly effective but if the work is completed it followed a process. Furthermore, if more multiple people do the same type of work without a clearly defined process it’s likely that there will inconsistent results to their work. A manager owns the overall output of all the work of their employees. If the work is consistently subpar or employees have a difficult time picking up the way to do the work that is expected of them, this is the responsibility of the manager to address. It doesn’t matter how amazing the employees are, they could have been consistently excelling in a previous, if the processes are terrible those employees will not succeed.

Not every type of work can effectively be managed through traditional software. For example, software and technology development in both these are “knowledge” activities that unlikely would benefit from a highly structured process. In these cases there are two things that help manage the process. First creating a regular process of checking in, managing what work the developers should be doing, and working to eliminate roadblocks – in software this is Agile software development. Second you create a standard process to feed in consistent data into the truly creative process and consistent outputs so that the consumers of the work are able to use the output of the creative process effectively in their work.

To manage the processes managers need to equip their employees and themselves with tools to do root cause analysis, conduct structured problem solving, and rigorous process improvement. Managers need to take ownership of the end to end process, the data their employees use to complete their work, and the quality of the results. It is important that this becomes the norm as it will switch blame from people, who generally want to do the right thing, to the process and how work is completed.

This is not to say that whenever people deviate from the agreed upon process that the manager shouldn’t address that or if people still fail to meet expectations while working in the process that they can’t be fired. However, leading employees to identify broken processes, supporting them in fixing them, and providing tools to do so becomes the role of the manager rather than micromanaging their employees.