Thursday, December 29

The Need for Speed: Net Product Lifecycles

My last post "The web is more powerful than a brain" leads onto thoughts of how short a products' life is becoming. It's not a new phenomenom but it is now spreading into new industry sectors.

We're all used to our digital camera's, phones and PC's being rendered out-dated within months, obsolete in little more than a year. To date, both on and offline, this has come down to fierce competition, manufacturing improvements and transient/demanding consumers. Now and with particular reference to the web these lifecycles are getting progressively shorter.

Ruby on Rails, Ajax...the plumbing of our next generation web have made the creation of sophisticated, interactive apps faster and cheaper than ever. So much so that my metaphor of a collaborative "web brain" is launching, crashing and burning new tools and businesses faster than anyone can compete with.

In the real-world, the newly equipped factories and design houses in Asia are tooled to turn prototypes of phones, accessories, PCs into finished articles within weeks rather than months and years. The same applies to shoes, cars and even home furnishings.

In my experience many businesses have not actively acknowledged these short lifecycles in their corporate strategies - the annual (once a year only plan/budget) continues to live on. Some of the effects are:

- Greater risk per product (each launch has to pay back quicker)
- Puts more emphasis on managing and minimising investment (to match a shorter sales life)
- The need for speed (the consumer and the competition wont wait for your board to make decisions)

There are many lessons to learn from Amazon and the like in this regard, but perhaps even more from mobile phone manufacturers - who have huge investments to lose if they are not nimble and in touch with their customers needs.

So, whilst many corporates are struggling to deal with 'The Need for Speed', the small guy - the entreprenuer - at least for now, has a much stronger hand than ever before. He can move quickly from idea to product and assemble teams as required. And by being a small business, he is forced to minimise his financial outlay. In this case 'fortune favours the fast'.

Have a happy new year.

Monday, December 19

The web is more powerful than a brain

All this talk about Web 2.0 right now. What's really important is that communities and consumer interaction is creating connections that no one ever could imagine on their own.

The internet now is actually fuelling the creative process by letting consumers cut, paste, mix, match, 'colour in' and share beyond streets, offices, neighbourhoods and countries. Whatever crazy ideas you've got, there are several million others in the world who'll be thinking the same things.

The technologies the industry is calling Web 2.0 are simply providing the plumbing to the masses.

Just as Tim Berners-Lee started by stitching PC's together to create something more powerful - a web of micro-chips. Now technology is beginning to take a back seat and users and their ideas are meeting seemlessly across http. That's the power of over 1 billion brains thinking together, moving together, creating.

As the collaborative tools and open API's become more mainstream we can expect people to collectively create images, sounds, applications and businesses no one person could ever imagine. And like a brain, the new internet is capable of incredible creativity by mixing structured and unstructured connections - the thoughts of billions.

The real new economy businesses are trying to own the tools that create these connections - like eBay, Six Apart, Alibaba and more recently Yahoo!'s MyWeb and BBC's BackStage. The first iterations of such tools were simplistic (like Amazon's user feedback, rating and recommendation lists) and controlled. But the business strategy is the same 'let the community do it's own thinking' and step-away to fuel the flames.

The question remains - can a business really hope to own or control part of this "web brain" over the long-term. Those billion people collaborating on thoughts/ideas may outpace any business, and that includes Google.

Are you a left-side or right-side person?

Tuesday, December 13

The Ancient Language, translated for Britons :-)

(English Phrase) Are you hiding a fugitive?

(Chinese Phrase) Hu Yu Hai Ding?

Did you go to the beach?

Wai Yu So Tan?

It's very dark in here

Wai So Dim

Please stay a while longer

Wai Go Nao?

I thought you were on a diet?

Wai Yu Mun Ching?

China's Sinking City

Sipping a Mocha looking across at The Bund, the tips of the waves from Shanghai's Huangpu river lap across the pavement Pudong promenade. Passers by leap out of the way to avoid their shoes getting dunked in the brown water.

Later, at the entrance to Shanghai's Art Museum (a fantastic gallery of contemporary Chinese painting) I saw a marker painted on the wall showing where the land level stood 15 years before. Shanghai has sunk over a metre and a half in those few years. As the steel and concrete goes up the land level is dropping. Residents might need those skyscrapers to keep their heads above water.

Watching Huangpu River is a fascinating place to see China's Industrial Revolution in live action. Cargo ships pass-by all day long ferrying everything that Shanghai wants and no longer needs. I couldn't take my eyes off this boat (right) which was so heavily laden looked to be slowly sinking as it made its way up stream.

Monday, December 5

A China Perspective

It's amazing how stepping out of your normal environment gives you a completely different view on the world. This always happens to me when I travel somewhere culturally 'different' like Myanmar or China this year.

So much of our social conditioning is dictated by our media. And whether we like it or not it dictates our view on the world. Just as the American and EU governments attack China for 'dumping' products on our markets, so the Chinese media highlight the tarrifs on their exports holding back the raising of their living standards.
For every paranoid article published in the Wall Street Journal or the Financial Times, a corresponding counter story appears in state media in China. And so it goes on.

What is suprising is how cheap some of the Chinese made products are in the West when compared with prices in China. In Shanghai, to keep my young baby entertained, we shopped for some toys. Now we are 'lao wai' (foreigners) so our street bargaining skills may not be up to Asian standards. But many toys are just a fraction cheaper in Shanghai than they would be in London. And this is not unique to toys.

If you run a factory in China producing a 100,000 'widgets' and you can 'run-on' an extra 20,000 at a nominal marginal cost to export, why not.

Are the Chinese selling (dumping) below cost? Are Western companies negotiating really hard and getting great prices? Or are Western countries really just getting a 'good deal' on the prices they pay?

There is one answer that we needn't ask the question for - China is going places really quickly. The Chinese aquire knowledge at an incredible pace. They build the highest most highly engineered buildings. They carry hundreds of millions of people on their trains each month. They produce billions of products, from plastic pens to the most advanced mobile phones in the world. And they have pride in what they do, in what they achieve and in what they create.

It is eye-opening to get a different perspective and to see things with your own eyes. I am struck by an enormous admiration for the people of a city that has built thousands of skyscrapers in a matter of years. And also by this country that is charging along to embrace global trade, with only a few years experience. If this is a race then Western economies ought to make more of their headstart.

From Shanghai with love