Test 3

Test 3 posted on the wiki

http://kmfall2008.pbwiki.com/3500fall2008

each question will be a mini-paper

4 pages each double spaced

questions from the new age of innovations

and neural networks

bring book and laptop with me over thanksgiving break

chapters 1-6

Class notes 11/19/08

Dr. Jih's comments
What is N=1?
-company looks at customers on an individual basis
Who are customers?
-who ever buys product service or using service
-users=customers
-external customers and internal customers
-consider individual difference to satifsfy everyone's needs

New Age of Innovation Chapter 6

Efficiency and Flexibly
variety, flexibility, adaptation,
social architecture
-culture and training and are based on process execution excellence
technical architecture
-there are rigid controls for changes

line of business and CIO disconnect

the tension between flexibility and efficiency cannot be avoided.

Inside Neural Networks

Our Brain
-made up of billions of signals
-neurons are connected to millions of other neurons


Artificial neural network
-in the software there are only thousand not billions
-the connections in the brain are much more complex
-lots of redundancies in a natural neural network
--makes up for potential brain injuries
-created more simulations or emulation of our neurological make up

How it works
-use a software that can be used to create a model
-the model must be knowledgeable about something
-have input and output neurons
-only input variables effect the output domain
-start with a blank sheet, and start creating neurons, and the connections between neurons
-the more connection the strength of the network improves and gets more knowledgeable
-

New Age of Innovation Chapter 3 notes

Quality of Business Processes
-determine the capability of firms to compete effectively
-cant be static
-Example: SMS messages used for settling

Analysis
-describe mathematical applications that permits bus. to crunch everything

Business Insights
-Analytics Engine
--focus on strategic priorities
--N=1, R=G
-Actionable Insights
--focus on co creation
-Rich Transaction Data
--consistent, transparent
--access database
--characteristics of the field are cleanly defined
--easy to deal with
-Unstructured Data
--difficult to put into a neat format
--web-page content
--wiki's
--minutes from a meeting
--weak signals
--audio file
--multimedia data

Analytical tools
-foresight, not hindsight is more valuable
-foresight is the understanding through data

Global Resource Access
-the capability of leverage global r will demand new levels of visibility in managing logistics of physical goods and resources globally to meet unique demands of customers

Examples
-Schneider Electric
--world's largest manufacture of electrical distribution systems
--$8.8 billion in sales
-UPS
--provide full visibility of 15 million packages shipped daily
--uses N=1
--uses GPS to track each truck and package
-DOD
--uses RFID tags to track supplies

Dynamic Real-Time Reconfiguration of Resources
-visibly in the supply chain is almost a requirement
-reconfigure resources globally starts with the simply trend analyitics of the key metrics across different markets
-online companies
--provide chat sessions

Building Blocks of R-G Capabilities
-visibility to process data
-real-time configuration of re
-anticipation of demand and resource needs
-insights

Building Blocks of N=1
-Focus on individual choice
-Capacity to co create with customers
-Anticipation of customer evolution pathways
-insights

Online Services
-Google, Facebook, Yahoo!
--allow customers to design their own choices of news topics and sources
-Amazon.com, eBay
--provides personalized products and services based on customers past choices

N=1 meets R=G
-the transformation to a customer centric co creation view of value pushes firms to new frontiers of the price performance envelope



Dr. Jih's comments
-more unstructured data in our Internet society
-gain more knowledge out of rich transaction data
-analytics
--data->knowledge
-technology->application
--analysis systems
--software applications
-business partners and suppliers can access inventory data
-manufacturs have enough info about a market places so they don't overproduce
-not everyone can access global resources

Exam 3: Nov.26

Topics:
-Buchman Laboratories
-Neural networking applications
-Definition
-Applications
-Advantages and Disadvantages
-Comparison with expert systems

-The new age of innovation chapters 1-6
-How is KM relevant to the innovative strategy of N=1 and R=G?
-Leadership provides vision and strategy. Implementation comes from commitment and hard works of the grassroot.
-The only way the N=1 value can be consistently and efficiently delivered is through well-designed and well-executed business processes. To be effecteive, high power knowledge must be embedded throughout the major business processes.
-Definitions of business process
-Operational, managerial, and strategic business processes
-Examples of business processes in information systems

Dr. Jih's notes 11/5/08

Social Architecture
-N=1 personalized co-created experiences
-R=G global access to resources and talents

Technical Architecture-process KM
-IT
-develop new applications
-security audit
-Standard Operating Procedures


Theory
-stories
-linkages
-facts

Business Organic System
-mission
-community

Knowledge Management is a business process
-oppertunity -> knowledge repository -> sharp validation

Dr. Jih's lecture 11/3/08

Dr. Jih's Comments
-info->knowledge->input->output
-process contributes to the value of production
-strategic asset
-business strategy using smart infor and knowledge strategy
-technological infrastructure

Measurement
-data
-N=1
-value

Analysis
-sometimes relevent data is sometimes hidden
-need to be able to find it properly
-resource


-access->ownership ex. www. (the internet) access on demand
-complex task but doable

Context Specific
-one of the mega trends in knowledge management
-experience that can be transfered
-don't just look at the number of years, actually look at the learner

-keep the key words in mind

facts change, principles don't
will remember theories, principles and stories more than will remember facts

1. theories
2. stories
3. language

New Age of Innovation Chapter 1 notes

The Transformation of Business

BASIC Pillars
-N=1
-value is based on unique personalized experiences of the consumer
-R=G
-no firm is big enough in scope and size to satisfy the experiences of one consumer at a time

Model T
-consumers were treated as an undifferentiated group
-all resources had to be within the firm to capture value

TutorVista
-student choose the time when he wants to be tutored
-lessons are personalized for that student
-training for teacher, can take from 60 to 100 hours
-initial reviews show that US students participating in the system had dramatically improved their understand of the subjects ant their performance
-TutorVista has access to 600 tutors
-$99 a month
-Resources are accessed as need from a global resource pool
-TutorVista currently has over 10,000 paying students, and it is expanding its tutor base over 5,000 tutors to countries outside India, including the US
-the power of technology and analytics can be focused on the needs of a single individual

Truck Tires
-Vendors sell their products competing largely on the basis of price, durability and brand awareness
-contract with fleet owners to charger per mileage of usage
-the revenue is based on tire usage not on a one-time tire sale
-the retail business shift from transaction base to an ongoing relationship with the consumer
-the firm get details data on how the individual drives

Driver Safety
-help a specific driver improve their skill
-installed sensors that measure tire performance in real time and relay the date to a central date center

Goodyear vs. Bridgestone
-Goodyear already has a program that measures tire performance

B2B and B2C
-the firm is moving from selling a product to selling a service
-the firm is moving from a transactional relationship to a service relationship

Principle 1: N=1
-one customer experience at a time
-no single first can provide the range of skills
-if vendors do not align their resources to capitalise on the first two weeks the release is dead
-the consumers experience must be simple and intuitive

R=G
-approach to understanding the nature of there resource base of large firms and learning now to access high quality service
-large firms focus on sensing what is available and leveraging the innovations that are coming out of labs

N=1 and R=G social movement
-whether it is buying tires or renting movies we are migrating to an N=1 world

Video on GM and the New Age of Innovation

Naked Conversation Chapter 5+6 notes

Chapter 5

1. Talk don't sell

2. Post often and be interesting

3. Write on issues you know and care about

4. Blogging saves money but costs time

5. You get smarter by listening to what people tell you

Chapter 6

-continously gather customer feedback

-make it a point to share knowledge freely

-expertly build word-of-mouth networks

-encourage communities of customers to meet and share

-devise specialized smaller offerings to get customers to bite

-focus on making the world, or your industry better

Web 2.0

Published on O'Reilly (http://www.oreilly.com/)
http://www.oreillynet.com/pub/a/oreilly/tim/news/2005/09/30/what-is-web-20.html
See this if you're having trouble printing code examples

What Is Web 2.0
Design Patterns and Business Models for the Next Generation of Software

by Tim O'Reilly

The bursting of the dot-com bubble in the fall of 2001 marked a turning point for the web. Many people concluded that the web was overhyped, when in fact bubbles and consequent shakeouts appear to be a common feature of all technological revolutions. Shakeouts typically mark the point at which an ascendant technology is ready to take its place at center stage. The pretenders are given the bum's rush, the real success stories show their strength, and there begins to be an understanding of what separates one from the other.

The concept of "Web 2.0" began with a conference brainstorming session between O'Reilly and MediaLive International. Dale Dougherty, web pioneer and O'Reilly VP, noted that far from having "crashed", the web was more important than ever, with exciting new applications and sites popping up with surprising regularity. What's more, the companies that had survived the collapse seemed to have some things in common. Could it be that the dot-com collapse marked some kind of turning point for the web, such that a call to action such as "Web 2.0" might make sense? We agreed that it did, and so the Web 2.0 Conference was born.

In the year and a half since, the term "Web 2.0" has clearly taken hold, with more than 9.5 million citations in Google. But there's still a huge amount of disagreement about just what Web 2.0 means, with some people decrying it as a meaningless marketing buzzword, and others accepting it as the new conventional wisdom.

This article is an attempt to clarify just what we mean by Web 2.0.

In our initial brainstorming, we formulated our sense of Web 2.0 by example:

Web 1.0 Web 2.0
DoubleClick --> Google AdSense
Ofoto --> Flickr
Akamai --> BitTorrent
mp3.com --> Napster
Britannica Online --> Wikipedia
personal websites --> blogging
evite --> upcoming.org and EVDB
domain name speculation --> search engine optimization
page views --> cost per click
screen scraping --> web services
publishing --> participation
content management systems --> wikis
directories (taxonomy) --> tagging ("folksonomy")
stickiness --> syndication
The list went on and on. But what was it that made us identify one application or approach as "Web 1.0" and another as "Web 2.0"? (The question is particularly urgent because the Web 2.0 meme has become so widespread that companies are now pasting it on as a marketing buzzword, with no real understanding of just what it means. The question is particularly difficult because many of those buzzword-addicted startups are definitely not Web 2.0, while some of the applications we identified as Web 2.0, like Napster and BitTorrent, are not even properly web applications!) We began trying to tease out the principles that are demonstrated in one way or another by the success stories of web 1.0 and by the most interesting of the new applications.

1. The Web As Platform

Like many important concepts, Web 2.0 doesn't have a hard boundary, but rather, a gravitational core. You can visualize Web 2.0 as a set of principles and practices that tie together a veritable solar system of sites that demonstrate some or all of those principles, at a varying distance from that core.



Figure 1 shows a "meme map" of Web 2.0 that was developed at a brainstorming session during FOO Camp, a conference at O'Reilly Media. It's very much a work in progress, but shows the many ideas that radiate out from the Web 2.0 core.

For example, at the first Web 2.0 conference, in October 2004, John Battelle and I listed a preliminary set of principles in our opening talk. The first of those principles was "The web as platform." Yet that was also a rallying cry of Web 1.0 darling Netscape, which went down in flames after a heated battle with Microsoft. What's more, two of our initial Web 1.0 exemplars, DoubleClick and Akamai, were both pioneers in treating the web as a platform. People don't often think of it as "web services", but in fact, ad serving was the first widely deployed web service, and the first widely deployed "mashup" (to use another term that has gained currency of late). Every banner ad is served as a seamless cooperation between two websites, delivering an integrated page to a reader on yet another computer. Akamai also treats the network as the platform, and at a deeper level of the stack, building a transparent caching and content delivery network that eases bandwidth congestion.

Nonetheless, these pioneers provided useful contrasts because later entrants have taken their solution to the same problem even further, understanding something deeper about the nature of the new platform. Both DoubleClick and Akamai were Web 2.0 pioneers, yet we can also see how it's possible to realize more of the possibilities by embracing additional Web 2.0 design patterns.

Let's drill down for a moment into each of these three cases, teasing out some of the essential elements of difference.

Netscape vs. Google

If Netscape was the standard bearer for Web 1.0, Google is most certainly the standard bearer for Web 2.0, if only because their respective IPOs were defining events for each era. So let's start with a comparison of these two companies and their positioning.

Netscape framed "the web as platform" in terms of the old software paradigm: their flagship product was the web browser, a desktop application, and their strategy was to use their dominance in the browser market to establish a market for high-priced server products. Control over standards for displaying content and applications in the browser would, in theory, give Netscape the kind of market power enjoyed by Microsoft in the PC market. Much like the "horseless carriage" framed the automobile as an extension of the familiar, Netscape promoted a "webtop" to replace the desktop, and planned to populate that webtop with information updates and applets pushed to the webtop by information providers who would purchase Netscape servers.

In the end, both web browsers and web servers turned out to be commodities, and value moved "up the stack" to services delivered over the web platform.

Google, by contrast, began its life as a native web application, never sold or packaged, but delivered as a service, with customers paying, directly or indirectly, for the use of that service. None of the trappings of the old software industry are present. No scheduled software releases, just continuous improvement. No licensing or sale, just usage. No porting to different platforms so that customers can run the software on their own equipment, just a massively scalable collection of commodity PCs running open source operating systems plus homegrown applications and utilities that no one outside the company ever gets to see.

At bottom, Google requires a competency that Netscape never needed: database management. Google isn't just a collection of software tools, it's a specialized database. Without the data, the tools are useless; without the software, the data is unmanageable. Software licensing and control over APIs--the lever of power in the previous era--is irrelevant because the software never need be distributed but only performed, and also because without the ability to collect and manage the data, the software is of little use. In fact, the value of the software is proportional to the scale and dynamism of the data it helps to manage.

Google's service is not a server--though it is delivered by a massive collection of internet servers--nor a browser--though it is experienced by the user within the browser. Nor does its flagship search service even host the content that it enables users to find. Much like a phone call, which happens not just on the phones at either end of the call, but on the network in between, Google happens in the space between browser and search engine and destination content server, as an enabler or middleman between the user and his or her online experience.

While both Netscape and Google could be described as software companies, it's clear that Netscape belonged to the same software world as Lotus, Microsoft, Oracle, SAP, and other companies that got their start in the 1980's software revolution, while Google's fellows are other internet applications like eBay, Amazon, Napster, and yes, DoubleClick and Akamai.


DoubleClick vs. Overture and AdSense

Like Google, DoubleClick is a true child of the internet era. It harnesses software as a service, has a core competency in data management, and, as noted above, was a pioneer in web services long before web services even had a name. However, DoubleClick was ultimately limited by its business model. It bought into the '90s notion that the web was about publishing, not participation; that advertisers, not consumers, ought to call the shots; that size mattered, and that the internet was increasingly being dominated by the top websites as measured by MediaMetrix and other web ad scoring companies.

As a result, DoubleClick proudly cites on its website "over 2000 successful implementations" of its software. Yahoo! Search Marketing (formerly Overture) and Google AdSense, by contrast, already serve hundreds of thousands of advertisers apiece.

Overture and Google's success came from an understanding of what Chris Anderson refers to as "the long tail," the collective power of the small sites that make up the bulk of the web's content. DoubleClick's offerings require a formal sales contract, limiting their market to the few thousand largest websites. Overture and Google figured out how to enable ad placement on virtually any web page. What's more, they eschewed publisher/ad-agency friendly advertising formats such as banner ads and popups in favor of minimally intrusive, context-sensitive, consumer-friendly text advertising.

The Web 2.0 lesson: leverage customer-self service and algorithmic data management to reach out to the entire web, to the edges and not just the center, to the long tail and not just the head.

A Platform Beats an Application Every Time

In each of its past confrontations with rivals, Microsoft has successfully played the platform card, trumping even the most dominant applications. Windows allowed Microsoft to displace Lotus 1-2-3 with Excel, WordPerfect with Word, and Netscape Navigator with Internet Explorer.

This time, though, the clash isn't between a platform and an application, but between two platforms, each with a radically different business model: On the one side, a single software provider, whose massive installed base and tightly integrated operating system and APIs give control over the programming paradigm; on the other, a system without an owner, tied together by a set of protocols, open standards and agreements for cooperation.

Windows represents the pinnacle of proprietary control via software APIs. Netscape tried to wrest control from Microsoft using the same techniques that Microsoft itself had used against other rivals, and failed. But Apache, which held to the open standards of the web, has prospered. The battle is no longer unequal, a platform versus a single application, but platform versus platform, with the question being which platform, and more profoundly, which architecture, and which business model, is better suited to the opportunity ahead.

Windows was a brilliant solution to the problems of the early PC era. It leveled the playing field for application developers, solving a host of problems that had previously bedeviled the industry. But a single monolithic approach, controlled by a single vendor, is no longer a solution, it's a problem. Communications-oriented systems, as the internet-as-platform most certainly is, require interoperability. Unless a vendor can control both ends of every interaction, the possibilities of user lock-in via software APIs are limited.

Any Web 2.0 vendor that seeks to lock in its application gains by controlling the platform will, by definition, no longer be playing to the strengths of the platform.

This is not to say that there are not opportunities for lock-in and competitive advantage, but we believe they are not to be found via control over software APIs and protocols. There is a new game afoot. The companies that succeed in the Web 2.0 era will be those that understand the rules of that game, rather than trying to go back to the rules of the PC software era.

Not surprisingly, other web 2.0 success stories demonstrate this same behavior. eBay enables occasional transactions of only a few dollars between single individuals, acting as an automated intermediary. Napster (though shut down for legal reasons) built its network not by building a centralized song database, but by architecting a system in such a way that every downloader also became a server, and thus grew the network.

Akamai vs. BitTorrent

Like DoubleClick, Akamai is optimized to do business with the head, not the tail, with the center, not the edges. While it serves the benefit of the individuals at the edge of the web by smoothing their access to the high-demand sites at the center, it collects its revenue from those central sites.

BitTorrent, like other pioneers in the P2P movement, takes a radical approach to internet decentralization. Every client is also a server; files are broken up into fragments that can be served from multiple locations, transparently harnessing the network of downloaders to provide both bandwidth and data to other users. The more popular the file, in fact, the faster it can be served, as there are more users providing bandwidth and fragments of the complete file.

BitTorrent thus demonstrates a key Web 2.0 principle: the service automatically gets better the more people use it. While Akamai must add servers to improve service, every BitTorrent consumer brings his own resources to the party. There's an implicit "architecture of participation", a built-in ethic of cooperation, in which the service acts primarily as an intelligent broker, connecting the edges to each other and harnessing the power of the users themselves.

2. Harnessing Collective Intelligence

The central principle behind the success of the giants born in the Web 1.0 era who have survived to lead the Web 2.0 era appears to be this, that they have embraced the power of the web to harness collective intelligence:

Hyperlinking is the foundation of the web. As users add new content, and new sites, it is bound in to the structure of the web by other users discovering the content and linking to it. Much as synapses form in the brain, with associations becoming stronger through repetition or intensity, the web of connections grows organically as an output of the collective activity of all web users.
Yahoo!, the first great internet success story, was born as a catalog, or directory of links, an aggregation of the best work of thousands, then millions of web users. While Yahoo! has since moved into the business of creating many types of content, its role as a portal to the collective work of the net's users remains the core of its value.
Google's breakthrough in search, which quickly made it the undisputed search market leader, was PageRank, a method of using the link structure of the web rather than just the characteristics of documents to provide better search results.
eBay's product is the collective activity of all its users; like the web itself, eBay grows organically in response to user activity, and the company's role is as an enabler of a context in which that user activity can happen. What's more, eBay's competitive advantage comes almost entirely from the critical mass of buyers and sellers, which makes any new entrant offering similar services significantly less attractive.
Amazon sells the same products as competitors such as Barnesandnoble.com, and they receive the same product descriptions, cover images, and editorial content from their vendors. But Amazon has made a science of user engagement. They have an order of magnitude more user reviews, invitations to participate in varied ways on virtually every page--and even more importantly, they use user activity to produce better search results. While a Barnesandnoble.com search is likely to lead with the company's own products, or sponsored results, Amazon always leads with "most popular", a real-time computation based not only on sales but other factors that Amazon insiders call the "flow" around products. With an order of magnitude more user participation, it's no surprise that Amazon's sales also outpace competitors.
Now, innovative companies that pick up on this insight and perhaps extend it even further, are making their mark on the web:

Wikipedia, an online encyclopedia based on the unlikely notion that an entry can be added by any web user, and edited by any other, is a radical experiment in trust, applying Eric Raymond's dictum (originally coined in the context of open source software) that "with enough eyeballs, all bugs are shallow," to content creation. Wikipedia is already in the top 100 websites, and many think it will be in the top ten before long. This is a profound change in the dynamics of content creation!
Sites like del.icio.us and Flickr, two companies that have received a great deal of attention of late, have pioneered a concept that some people call "folksonomy" (in contrast to taxonomy), a style of collaborative categorization of sites using freely chosen keywords, often referred to as tags. Tagging allows for the kind of multiple, overlapping associations that the brain itself uses, rather than rigid categories. In the canonical example, a Flickr photo of a puppy might be tagged both "puppy" and "cute"--allowing for retrieval along natural axes generated user activity.
Collaborative spam filtering products like Cloudmark aggregate the individual decisions of email users about what is and is not spam, outperforming systems that rely on analysis of the messages themselves.
It is a truism that the greatest internet success stories don't advertise their products. Their adoption is driven by "viral marketing"--that is, recommendations propagating directly from one user to another. You can almost make the case that if a site or product relies on advertising to get the word out, it isn't Web 2.0.
Even much of the infrastructure of the web--including the Linux, Apache, MySQL, and Perl, PHP, or Python code involved in most web servers--relies on the peer-production methods of open source, in themselves an instance of collective, net-enabled intelligence. There are more than 100,000 open source software projects listed on SourceForge.net. Anyone can add a project, anyone can download and use the code, and new projects migrate from the edges to the center as a result of users putting them to work, an organic software adoption process relying almost entirely on viral marketing.
The lesson: Network effects from user contributions are the key to market dominance in the Web 2.0 era.


Blogging and the Wisdom of Crowds

One of the most highly touted features of the Web 2.0 era is the rise of blogging. Personal home pages have been around since the early days of the web, and the personal diary and daily opinion column around much longer than that, so just what is the fuss all about?

At its most basic, a blog is just a personal home page in diary format. But as Rich Skrenta notes, the chronological organization of a blog "seems like a trivial difference, but it drives an entirely different delivery, advertising and value chain."

One of the things that has made a difference is a technology called RSS. RSS is the most significant advance in the fundamental architecture of the web since early hackers realized that CGI could be used to create database-backed websites. RSS allows someone to link not just to a page, but to subscribe to it, with notification every time that page changes. Skrenta calls this "the incremental web." Others call it the "live web".

Now, of course, "dynamic websites" (i.e., database-backed sites with dynamically generated content) replaced static web pages well over ten years ago. What's dynamic about the live web are not just the pages, but the links. A link to a weblog is expected to point to a perennially changing page, with "permalinks" for any individual entry, and notification for each change. An RSS feed is thus a much stronger link than, say a bookmark or a link to a single page.

The Architecture of Participation

Some systems are designed to encourage participation. In his paper, The Cornucopia of the Commons, Dan Bricklin noted that there are three ways to build a large database. The first, demonstrated by Yahoo!, is to pay people to do it. The second, inspired by lessons from the open source community, is to get volunteers to perform the same task. The Open Directory Project, an open source Yahoo competitor, is the result. But Napster demonstrated a third way. Because Napster set its defaults to automatically serve any music that was downloaded, every user automatically helped to build the value of the shared database. This same approach has been followed by all other P2P file sharing services.

One of the key lessons of the Web 2.0 era is this: Users add value. But only a small percentage of users will go to the trouble of adding value to your application via explicit means. Therefore, Web 2.0 companies set inclusive defaults for aggregating user data and building value as a side-effect of ordinary use of the application. As noted above, they build systems that get better the more people use them.

Mitch Kapor once noted that "architecture is politics." Participation is intrinsic to Napster, part of its fundamental architecture.

This architectural insight may also be more central to the success of open source software than the more frequently cited appeal to volunteerism. The architecture of the internet, and the World Wide Web, as well as of open source software projects like Linux, Apache, and Perl, is such that users pursuing their own "selfish" interests build collective value as an automatic byproduct. Each of these projects has a small core, well-defined extension mechanisms, and an approach that lets any well-behaved component be added by anyone, growing the outer layers of what Larry Wall, the creator of Perl, refers to as "the onion." In other words, these technologies demonstrate network effects, simply through the way that they have been designed.

These projects can be seen to have a natural architecture of participation. But as Amazon demonstrates, by consistent effort (as well as economic incentives such as the Associates program), it is possible to overlay such an architecture on a system that would not normally seem to possess it.

RSS also means that the web browser is not the only means of viewing a web page. While some RSS aggregators, such as Bloglines, are web-based, others are desktop clients, and still others allow users of portable devices to subscribe to constantly updated content.

RSS is now being used to push not just notices of new blog entries, but also all kinds of data updates, including stock quotes, weather data, and photo availability. This use is actually a return to one of its roots: RSS was born in 1997 out of the confluence of Dave Winer's "Really Simple Syndication" technology, used to push out blog updates, and Netscape's "Rich Site Summary", which allowed users to create custom Netscape home pages with regularly updated data flows. Netscape lost interest, and the technology was carried forward by blogging pioneer Userland, Winer's company. In the current crop of applications, we see, though, the heritage of both parents.

But RSS is only part of what makes a weblog different from an ordinary web page. Tom Coates remarks on the significance of the permalink:

It may seem like a trivial piece of functionality now, but it was effectively the device that turned weblogs from an ease-of-publishing phenomenon into a conversational mess of overlapping communities. For the first time it became relatively easy to gesture directly at a highly specific post on someone else's site and talk about it. Discussion emerged. Chat emerged. And - as a result - friendships emerged or became more entrenched. The permalink was the first - and most successful - attempt to build bridges between weblogs.
In many ways, the combination of RSS and permalinks adds many of the features of NNTP, the Network News Protocol of the Usenet, onto HTTP, the web protocol. The "blogosphere" can be thought of as a new, peer-to-peer equivalent to Usenet and bulletin-boards, the conversational watering holes of the early internet. Not only can people subscribe to each others' sites, and easily link to individual comments on a page, but also, via a mechanism known as trackbacks, they can see when anyone else links to their pages, and can respond, either with reciprocal links, or by adding comments.

Interestingly, two-way links were the goal of early hypertext systems like Xanadu. Hypertext purists have celebrated trackbacks as a step towards two way links. But note that trackbacks are not properly two-way--rather, they are really (potentially) symmetrical one-way links that create the effect of two way links. The difference may seem subtle, but in practice it is enormous. Social networking systems like Friendster, Orkut, and LinkedIn, which require acknowledgment by the recipient in order to establish a connection, lack the same scalability as the web. As noted by Caterina Fake, co-founder of the Flickr photo sharing service, attention is only coincidentally reciprocal. (Flickr thus allows users to set watch lists--any user can subscribe to any other user's photostream via RSS. The object of attention is notified, but does not have to approve the connection.)

If an essential part of Web 2.0 is harnessing collective intelligence, turning the web into a kind of global brain, the blogosphere is the equivalent of constant mental chatter in the forebrain, the voice we hear in all of our heads. It may not reflect the deep structure of the brain, which is often unconscious, but is instead the equivalent of conscious thought. And as a reflection of conscious thought and attention, the blogosphere has begun to have a powerful effect.

First, because search engines use link structure to help predict useful pages, bloggers, as the most prolific and timely linkers, have a disproportionate role in shaping search engine results. Second, because the blogging community is so highly self-referential, bloggers paying attention to other bloggers magnifies their visibility and power. The "echo chamber" that critics decry is also an amplifier.

If it were merely an amplifier, blogging would be uninteresting. But like Wikipedia, blogging harnesses collective intelligence as a kind of filter. What James Suriowecki calls "the wisdom of crowds" comes into play, and much as PageRank produces better results than analysis of any individual document, the collective attention of the blogosphere selects for value.

While mainstream media may see individual blogs as competitors, what is really unnerving is that the competition is with the blogosphere as a whole. This is not just a competition between sites, but a competition between business models. The world of Web 2.0 is also the world of what Dan Gillmor calls "we, the media," a world in which "the former audience", not a few people in a back room, decides what's important.

3. Data is the Next Intel Inside

Every significant internet application to date has been backed by a specialized database: Google's web crawl, Yahoo!'s directory (and web crawl), Amazon's database of products, eBay's database of products and sellers, MapQuest's map databases, Napster's distributed song database. As Hal Varian remarked in a personal conversation last year, "SQL is the new HTML." Database management is a core competency of Web 2.0 companies, so much so that we have sometimes referred to these applications as "infoware" rather than merely software.

This fact leads to a key question: Who owns the data?

In the internet era, one can already see a number of cases where control over the database has led to market control and outsized financial returns. The monopoly on domain name registry initially granted by government fiat to Network Solutions (later purchased by Verisign) was one of the first great moneymakers of the internet. While we've argued that business advantage via controlling software APIs is much more difficult in the age of the internet, control of key data sources is not, especially if those data sources are expensive to create or amenable to increasing returns via network effects.

Look at the copyright notices at the base of every map served by MapQuest, maps.yahoo.com, maps.msn.com, or maps.google.com, and you'll see the line "Maps copyright NavTeq, TeleAtlas," or with the new satellite imagery services, "Images copyright Digital Globe." These companies made substantial investments in their databases (NavTeq alone reportedly invested $750 million to build their database of street addresses and directions. Digital Globe spent $500 million to launch their own satellite to improve on government-supplied imagery.) NavTeq has gone so far as to imitate Intel's familiar Intel Inside logo: Cars with navigation systems bear the imprint, "NavTeq Onboard." Data is indeed the Intel Inside of these applications, a sole source component in systems whose software infrastructure is largely open source or otherwise commodified.

The now hotly contested web mapping arena demonstrates how a failure to understand the importance of owning an application's core data will eventually undercut its competitive position. MapQuest pioneered the web mapping category in 1995, yet when Yahoo!, and then Microsoft, and most recently Google, decided to enter the market, they were easily able to offer a competing application simply by licensing the same data.

Contrast, however, the position of Amazon.com. Like competitors such as Barnesandnoble.com, its original database came from ISBN registry provider R.R. Bowker. But unlike MapQuest, Amazon relentlessly enhanced the data, adding publisher-supplied data such as cover images, table of contents, index, and sample material. Even more importantly, they harnessed their users to annotate the data, such that after ten years, Amazon, not Bowker, is the primary source for bibliographic data on books, a reference source for scholars and librarians as well as consumers. Amazon also introduced their own proprietary identifier, the ASIN, which corresponds to the ISBN where one is present, and creates an equivalent namespace for products without one. Effectively, Amazon "embraced and extended" their data suppliers.

Imagine if MapQuest had done the same thing, harnessing their users to annotate maps and directions, adding layers of value. It would have been much more difficult for competitors to enter the market just by licensing the base data.

The recent introduction of Google Maps provides a living laboratory for the competition between application vendors and their data suppliers. Google's lightweight programming model has led to the creation of numerous value-added services in the form of mashups that link Google Maps with other internet-accessible data sources. Paul Rademacher's housingmaps.com, which combines Google Maps with Craigslist apartment rental and home purchase data to create an interactive housing search tool, is the pre-eminent example of such a mashup.

At present, these mashups are mostly innovative experiments, done by hackers. But entrepreneurial activity follows close behind. And already, one can see that for at least one class of developer, Google has taken the role of data source away from Navteq and inserted themselves as a favored intermediary. We expect to see battles between data suppliers and application vendors in the next few years, as both realize just how important certain classes of data will become as building blocks for Web 2.0 applications.

The race is on to own certain classes of core data: location, identity, calendaring of public events, product identifiers and namespaces. In many cases, where there is significant cost to create the data, there may be an opportunity for an Intel Inside style play, with a single source for the data. In others, the winner will be the company that first reaches critical mass via user aggregation, and turns that aggregated data into a system service.

For example, in the area of identity, PayPal, Amazon's 1-click, and the millions of users of communications systems, may all be legitimate contenders to build a network-wide identity database. (In this regard, Google's recent attempt to use cell phone numbers as an identifier for Gmail accounts may be a step towards embracing and extending the phone system.) Meanwhile, startups like Sxip are exploring the potential of federated identity, in quest of a kind of "distributed 1-click" that will provide a seamless Web 2.0 identity subsystem. In the area of calendaring, EVDB is an attempt to build the world's largest shared calendar via a wiki-style architecture of participation. While the jury's still out on the success of any particular startup or approach, it's clear that standards and solutions in these areas, effectively turning certain classes of data into reliable subsystems of the "internet operating system", will enable the next generation of applications.

A further point must be noted with regard to data, and that is user concerns about privacy and their rights to their own data. In many of the early web applications, copyright is only loosely enforced. For example, Amazon lays claim to any reviews submitted to the site, but in the absence of enforcement, people may repost the same review elsewhere. However, as companies begin to realize that control over data may be their chief source of competitive advantage, we may see heightened attempts at control.

Much as the rise of proprietary software led to the Free Software movement, we expect the rise of proprietary databases to result in a Free Data movement within the next decade. One can see early signs of this countervailing trend in open data projects such as Wikipedia, the Creative Commons, and in software projects like Greasemonkey, which allow users to take control of how data is displayed on their computer.


4. End of the Software Release Cycle

As noted above in the discussion of Google vs. Netscape, one of the defining characteristics of internet era software is that it is delivered as a service, not as a product. This fact leads to a number of fundamental changes in the business model of such a company:

Operations must become a core competency. Google's or Yahoo!'s expertise in product development must be matched by an expertise in daily operations. So fundamental is the shift from software as artifact to software as service that the software will cease to perform unless it is maintained on a daily basis. Google must continuously crawl the web and update its indices, continuously filter out link spam and other attempts to influence its results, continuously and dynamically respond to hundreds of millions of asynchronous user queries, simultaneously matching them with context-appropriate advertisements.
It's no accident that Google's system administration, networking, and load balancing techniques are perhaps even more closely guarded secrets than their search algorithms. Google's success at automating these processes is a key part of their cost advantage over competitors.

It's also no accident that scripting languages such as Perl, Python, PHP, and now Ruby, play such a large role at web 2.0 companies. Perl was famously described by Hassan Schroeder, Sun's first webmaster, as "the duct tape of the internet." Dynamic languages (often called scripting languages and looked down on by the software engineers of the era of software artifacts) are the tool of choice for system and network administrators, as well as application developers building dynamic systems that require constant change.

Users must be treated as co-developers, in a reflection of open source development practices (even if the software in question is unlikely to be released under an open source license.) The open source dictum, "release early and release often" in fact has morphed into an even more radical position, "the perpetual beta," in which the product is developed in the open, with new features slipstreamed in on a monthly, weekly, or even daily basis. It's no accident that services such as Gmail, Google Maps, Flickr, del.icio.us, and the like may be expected to bear a "Beta" logo for years at a time.
Real time monitoring of user behavior to see just which new features are used, and how they are used, thus becomes another required core competency. A web developer at a major online service remarked: "We put up two or three new features on some part of the site every day, and if users don't adopt them, we take them down. If they like them, we roll them out to the entire site."

Cal Henderson, the lead developer of Flickr, recently revealed that they deploy new builds up to every half hour. This is clearly a radically different development model! While not all web applications are developed in as extreme a style as Flickr, almost all web applications have a development cycle that is radically unlike anything from the PC or client-server era. It is for this reason that a recent ZDnet editorial concluded that Microsoft won't be able to beat Google: "Microsoft's business model depends on everyone upgrading their computing environment every two to three years. Google's depends on everyone exploring what's new in their computing environment every day."

While Microsoft has demonstrated enormous ability to learn from and ultimately best its competition, there's no question that this time, the competition will require Microsoft (and by extension, every other existing software company) to become a deeply different kind of company. Native Web 2.0 companies enjoy a natural advantage, as they don't have old patterns (and corresponding business models and revenue sources) to shed.

A Web 2.0 Investment Thesis

Venture capitalist Paul Kedrosky writes: "The key is to find the actionable investments where you disagree with the consensus". It's interesting to see how each Web 2.0 facet involves disagreeing with the consensus: everyone was emphasizing keeping data private, Flickr/Napster/et al. make it public. It's not just disagreeing to be disagreeable (pet food! online!), it's disagreeing where you can build something out of the differences. Flickr builds communities, Napster built breadth of collection.

Another way to look at it is that the successful companies all give up something expensive but considered critical to get something valuable for free that was once expensive. For example, Wikipedia gives up central editorial control in return for speed and breadth. Napster gave up on the idea of "the catalog" (all the songs the vendor was selling) and got breadth. Amazon gave up on the idea of having a physical storefront but got to serve the entire world. Google gave up on the big customers (initially) and got the 80% whose needs weren't being met. There's something very aikido (using your opponent's force against them) in saying "you know, you're right--absolutely anyone in the whole world CAN update this article. And guess what, that's bad news for you."

--Nat Torkington

5. Lightweight Programming Models

Once the idea of web services became au courant, large companies jumped into the fray with a complex web services stack designed to create highly reliable programming environments for distributed applications.

But much as the web succeeded precisely because it overthrew much of hypertext theory, substituting a simple pragmatism for ideal design, RSS has become perhaps the single most widely deployed web service because of its simplicity, while the complex corporate web services stacks have yet to achieve wide deployment.

Similarly, Amazon.com's web services are provided in two forms: one adhering to the formalisms of the SOAP (Simple Object Access Protocol) web services stack, the other simply providing XML data over HTTP, in a lightweight approach sometimes referred to as REST (Representational State Transfer). While high value B2B connections (like those between Amazon and retail partners like ToysRUs) use the SOAP stack, Amazon reports that 95% of the usage is of the lightweight REST service.

This same quest for simplicity can be seen in other "organic" web services. Google's recent release of Google Maps is a case in point. Google Maps' simple AJAX (Javascript and XML) interface was quickly decrypted by hackers, who then proceeded to remix the data into new services.

Mapping-related web services had been available for some time from GIS vendors such as ESRI as well as from MapQuest and Microsoft MapPoint. But Google Maps set the world on fire because of its simplicity. While experimenting with any of the formal vendor-supported web services required a formal contract between the parties, the way Google Maps was implemented left the data for the taking, and hackers soon found ways to creatively re-use that data.

There are several significant lessons here:

Support lightweight programming models that allow for loosely coupled systems. The complexity of the corporate-sponsored web services stack is designed to enable tight coupling. While this is necessary in many cases, many of the most interesting applications can indeed remain loosely coupled, and even fragile. The Web 2.0 mindset is very different from the traditional IT mindset!
Think syndication, not coordination. Simple web services, like RSS and REST-based web services, are about syndicating data outwards, not controlling what happens when it gets to the other end of the connection. This idea is fundamental to the internet itself, a reflection of what is known as the end-to-end principle.
Design for "hackability" and remixability. Systems like the original web, RSS, and AJAX all have this in common: the barriers to re-use are extremely low. Much of the useful software is actually open source, but even when it isn't, there is little in the way of intellectual property protection. The web browser's "View Source" option made it possible for any user to copy any other user's web page; RSS was designed to empower the user to view the content he or she wants, when it's wanted, not at the behest of the information provider; the most successful web services are those that have been easiest to take in new directions unimagined by their creators. The phrase "some rights reserved," which was popularized by the Creative Commons to contrast with the more typical "all rights reserved," is a useful guidepost.
Innovation in Assembly

Lightweight business models are a natural concomitant of lightweight programming and lightweight connections. The Web 2.0 mindset is good at re-use. A new service like housingmaps.com was built simply by snapping together two existing services. Housingmaps.com doesn't have a business model (yet)--but for many small-scale services, Google AdSense (or perhaps Amazon associates fees, or both) provides the snap-in equivalent of a revenue model.

These examples provide an insight into another key web 2.0 principle, which we call "innovation in assembly." When commodity components are abundant, you can create value simply by assembling them in novel or effective ways. Much as the PC revolution provided many opportunities for innovation in assembly of commodity hardware, with companies like Dell making a science out of such assembly, thereby defeating companies whose business model required innovation in product development, we believe that Web 2.0 will provide opportunities for companies to beat the competition by getting better at harnessing and integrating services provided by others.

6. Software Above the Level of a Single Device

One other feature of Web 2.0 that deserves mention is the fact that it's no longer limited to the PC platform. In his parting advice to Microsoft, long time Microsoft developer Dave Stutz pointed out that "Useful software written above the level of the single device will command high margins for a long time to come."

Of course, any web application can be seen as software above the level of a single device. After all, even the simplest web application involves at least two computers: the one hosting the web server and the one hosting the browser. And as we've discussed, the development of the web as platform extends this idea to synthetic applications composed of services provided by multiple computers.

But as with many areas of Web 2.0, where the "2.0-ness" is not something new, but rather a fuller realization of the true potential of the web platform, this phrase gives us a key insight into how to design applications and services for the new platform.

To date, iTunes is the best exemplar of this principle. This application seamlessly reaches from the handheld device to a massive web back-end, with the PC acting as a local cache and control station. There have been many previous attempts to bring web content to portable devices, but the iPod/iTunes combination is one of the first such applications designed from the ground up to span multiple devices. TiVo is another good example.

iTunes and TiVo also demonstrate many of the other core principles of Web 2.0. They are not web applications per se, but they leverage the power of the web platform, making it a seamless, almost invisible part of their infrastructure. Data management is most clearly the heart of their offering. They are services, not packaged applications (although in the case of iTunes, it can be used as a packaged application, managing only the user's local data.) What's more, both TiVo and iTunes show some budding use of collective intelligence, although in each case, their experiments are at war with the IP lobby's. There's only a limited architecture of participation in iTunes, though the recent addition of podcasting changes that equation substantially.

This is one of the areas of Web 2.0 where we expect to see some of the greatest change, as more and more devices are connected to the new platform. What applications become possible when our phones and our cars are not consuming data but reporting it? Real time traffic monitoring, flash mobs, and citizen journalism are only a few of the early warning signs of the capabilities of the new platform.


7. Rich User Experiences

As early as Pei Wei's Viola browser in 1992, the web was being used to deliver "applets" and other kinds of active content within the web browser. Java's introduction in 1995 was framed around the delivery of such applets. JavaScript and then DHTML were introduced as lightweight ways to provide client side programmability and richer user experiences. Several years ago, Macromedia coined the term "Rich Internet Applications" (which has also been picked up by open source Flash competitor Laszlo Systems) to highlight the capabilities of Flash to deliver not just multimedia content but also GUI-style application experiences.

However, the potential of the web to deliver full scale applications didn't hit the mainstream till Google introduced Gmail, quickly followed by Google Maps, web based applications with rich user interfaces and PC-equivalent interactivity. The collection of technologies used by Google was christened AJAX, in a seminal essay by Jesse James Garrett of web design firm Adaptive Path. He wrote:

"Ajax isn't a technology. It's really several technologies, each flourishing in its own right, coming together in powerful new ways. Ajax incorporates:

standards-based presentation using XHTML and CSS;
dynamic display and interaction using the Document Object Model;
data interchange and manipulation using XML and XSLT;
asynchronous data retrieval using XMLHttpRequest;
and JavaScript binding everything together."
Web 2.0 Design Patterns

In his book, A Pattern Language, Christopher Alexander prescribes a format for the concise description of the solution to architectural problems. He writes: "Each pattern describes a problem that occurs over and over again in our environment, and then describes the core of the solution to that problem, in such a way that you can use this solution a million times over, without ever doing it the same way twice."

The Long Tail
Small sites make up the bulk of the internet's content; narrow niches make up the bulk of internet's the possible applications. Therefore: Leverage customer-self service and algorithmic data management to reach out to the entire web, to the edges and not just the center, to the long tail and not just the head.
Data is the Next Intel Inside
Applications are increasingly data-driven. Therefore: For competitive advantage, seek to own a unique, hard-to-recreate source of data.
Users Add Value
The key to competitive advantage in internet applications is the extent to which users add their own data to that which you provide. Therefore: Don't restrict your "architecture of participation" to software development. Involve your users both implicitly and explicitly in adding value to your application.
Network Effects by Default
Only a small percentage of users will go to the trouble of adding value to your application. Therefore: Set inclusive defaults for aggregating user data as a side-effect of their use of the application.
Some Rights Reserved. Intellectual property protection limits re-use and prevents experimentation. Therefore: When benefits come from collective adoption, not private restriction, make sure that barriers to adoption are low. Follow existing standards, and use licenses with as few restrictions as possible. Design for "hackability" and "remixability."
The Perpetual Beta
When devices and programs are connected to the internet, applications are no longer software artifacts, they are ongoing services. Therefore: Don't package up new features into monolithic releases, but instead add them on a regular basis as part of the normal user experience. Engage your users as real-time testers, and instrument the service so that you know how people use the new features.
Cooperate, Don't Control
Web 2.0 applications are built of a network of cooperating data services. Therefore: Offer web services interfaces and content syndication, and re-use the data services of others. Support lightweight programming models that allow for loosely-coupled systems.
Software Above the Level of a Single Device
The PC is no longer the only access device for internet applications, and applications that are limited to a single device are less valuable than those that are connected. Therefore: Design your application from the get-go to integrate services across handheld devices, PCs, and internet servers.
AJAX is also a key component of Web 2.0 applications such as Flickr, now part of Yahoo!, 37signals' applications basecamp and backpack, as well as other Google applications such as Gmail and Orkut. We're entering an unprecedented period of user interface innovation, as web developers are finally able to build web applications as rich as local PC-based applications.

Interestingly, many of the capabilities now being explored have been around for many years. In the late '90s, both Microsoft and Netscape had a vision of the kind of capabilities that are now finally being realized, but their battle over the standards to be used made cross-browser applications difficult. It was only when Microsoft definitively won the browser wars, and there was a single de-facto browser standard to write to, that this kind of application became possible. And while Firefox has reintroduced competition to the browser market, at least so far we haven't seen the destructive competition over web standards that held back progress in the '90s.

We expect to see many new web applications over the next few years, both truly novel applications, and rich web reimplementations of PC applications. Every platform change to date has also created opportunities for a leadership change in the dominant applications of the previous platform.

Gmail has already provided some interesting innovations in email, combining the strengths of the web (accessible from anywhere, deep database competencies, searchability) with user interfaces that approach PC interfaces in usability. Meanwhile, other mail clients on the PC platform are nibbling away at the problem from the other end, adding IM and presence capabilities. How far are we from an integrated communications client combining the best of email, IM, and the cell phone, using VoIP to add voice capabilities to the rich capabilities of web applications? The race is on.

It's easy to see how Web 2.0 will also remake the address book. A Web 2.0-style address book would treat the local address book on the PC or phone merely as a cache of the contacts you've explicitly asked the system to remember. Meanwhile, a web-based synchronization agent, Gmail-style, would remember every message sent or received, every email address and every phone number used, and build social networking heuristics to decide which ones to offer up as alternatives when an answer wasn't found in the local cache. Lacking an answer there, the system would query the broader social network.

A Web 2.0 word processor would support wiki-style collaborative editing, not just standalone documents. But it would also support the rich formatting we've come to expect in PC-based word processors. Writely is a good example of such an application, although it hasn't yet gained wide traction.

Nor will the Web 2.0 revolution be limited to PC applications. Salesforce.com demonstrates how the web can be used to deliver software as a service, in enterprise scale applications such as CRM.

The competitive opportunity for new entrants is to fully embrace the potential of Web 2.0. Companies that succeed will create applications that learn from their users, using an architecture of participation to build a commanding advantage not just in the software interface, but in the richness of the shared data.

Core Competencies of Web 2.0 Companies

In exploring the seven principles above, we've highlighted some of the principal features of Web 2.0. Each of the examples we've explored demonstrates one or more of those key principles, but may miss others. Let's close, therefore, by summarizing what we believe to be the core competencies of Web 2.0 companies:

Services, not packaged software, with cost-effective scalability
Control over unique, hard-to-recreate data sources that get richer as more people use them
Trusting users as co-developers
Harnessing collective intelligence
Leveraging the long tail through customer self-service
Software above the level of a single device
Lightweight user interfaces, development models, AND business models
The next time a company claims that it's "Web 2.0," test their features against the list above. The more points they score, the more they are worthy of the name. Remember, though, that excellence in one area may be more telling than some small steps in all seven.

Tim O'Reilly
O’Reilly Media, Inc., tim@oreilly.com
President and CEO

Copyright © 2007 O'Reilly Media, Inc.

Expert System Case study notes

-runs on a microcomputer workstation that has a communications interface

-the interface allows the expert system to tap data from the IMS cardholder databases hooked to an IBM mainframe

-when merchants call in for credit approval for a cardholder transmission, the expert system quickly pulls together and relevant database information, evaluates it, and makes either a decision or a recommendation as to whether or not credit should be granted.

-usually take into account as such factors as a cardholder's outstanding balance, payment history, buying habits, and the degree of risk involved

-should any warnings appear the system is even capable of asking merchants to obtain further information from the card holder such as a form on ID

-1/4 of all transactions processed by Authorizer's Assistant are straightforward enough to require no human intervention

-the system makes a decision and transmits it to the merchant

-the other transactions are referred to the system by human authorizers

-each is accompanied by an ID of the warning signs, an explanation regarding why the transaction is being referred, a recommendation for credit authorizer's or  denial, decision making data culled from the data-bases.

-if the human authorizer disagrees with  or questions a recommendation made by the expert system they can override it

-when humans and the expert system work together or decisions, the system cuts processing time by 20%

-to develop the knowledge base the developer uses a rule-based approach

-in doing so the developer's analysis interviews American Expresses 5 best authorizers in Ft. Lauderdale and created a knowledge base of 520 rules, the base was expanded to 800 after some refinement

-Authorizer's Assistant is still being used and supports more than 300 human authorizers 

Nucor Steel notes

-many managers would rather die than learn from each other

-effective knowledge management depends not merely on information-technology platforms but more broadly on the social ecology of an organization

-social ecology refers to the social system in which people operate

-it drives an organizations formal and informal expectations of individuals defines the types of people who will fit into the organization, shapes individuals freedom to peruse actions prior approval and addresses how people interact with others both inside and outside the organization.

-determinants are culture, structure, information systems, reward systems, processes, people and leadership

-IT plays a center role

-IT platforms are neither proprietary nor unique and provide a temporary advantage

-task of accumulating knowledge broken down into 3 tasks

-1. knowledge creation

-2. knowledge acquisition

-3. knowledge retention

-knowledge mobilization broken into sub tasks

-1. knowledge id

-2. knowledge outflow

-3. knowledge transmission

-4. knowledge inflow

-Nucor excelled by becoming and remaining the most efficient steel producer in the world by developing and constantly upgrading three competencies that were both strategic and proprietary: plant construction and start-up know how, manufacturing process expertise and the ability to adopt breakthrough technologies earlier and more effectively than competitors 

-Nucor's social ecology allowed the company to excel at the three sub tasks associated with accumulating knowledge: creating knowledge from direct experimentation, acquiring external knowledge, and retaining internally created or externally acquired knowledge

-Nucor was able to gain access to superior human capital by locating plants in rural areas that had an abundance of hard-working mechanically inclined people

-offered a top of the line compensation package

-high powered incentive system for every employee

-incentives were a function of  production output

-incentive payouts motivated workers to develop innovations that would help them do things right the first time

-people were challenged to expand the frontiers of process know-how

-Nucor fosters experimentation within a context of accountability

-retained knowledge by not laying people off

-relies on group based incentives

-incentives motivated people to share their own best practices with peer units

-goal was to build a social community within each plant

-achieved this by keeping the employee numbers down and holding dinner meetings

-Nucor transferred knowledge between plants

-maximize knowledge creation and acquisition 

-set stretch goals

-provide high-powered incentives

-cultivate empowerment and provide "slack" resources

-equip every unit with a well-defined "sandbox" for play

-cultivate a market for idea within the company

-maximize knowledge sharing

-ban "knowledge hoarding" and turn "knowledge givers" into heroes

-rely on group-based incentives

-invest in codifying tacit knowledge

-match transmission mechanisms to type of knowledge

-

Exam 2 notes

Topics to be covered:

1.The Nucor Steel article: knowledge creation and acquisition, knowledge sharing, role of information technology, social ecology

2.Expert system (case study) - definition, system structure, applications, advantages, and limitations

3.Characteristics of Web 2.0: The Web as a platform, User participation, Harnessing collective intelligence, New software life cycle, rich user experience (Network effects from user contributions are the key to market dominance in the Web 2.0 era.)

4."Connected consumers are collectively shaping your brand"

5.Naked Conversation: Chapters 1 - 8; Blogs for large companies, blogs for small companies, Blogs for marketing (conversational marketing), Blogs for advertising (word of mouth on steroids), Blogs for knowledge management


Exam 3-Nov. 26

Topics to be covered

1.Buchman Laboratories
2.Neural networking applications
3.The new age of innovation chapters 1-6

Project dates

Team 3- Me, Chris, Mark, Andrew

Chapter 2 presentation-Nov 5.

Chapter 5 presentation-Nov. 17

10/20/08 class notes

Notes on Expert Systems
http://en.wikipedia.org/wiki/Expert_systems

Expert Systems
- a system that performs on a knowledge base
- contains the specific knowledge that is contributed by someone who has many years experience in that domain
- sub-field of artificial intelligence
- simultaneous processing
- knowledge representation
-- cognitive science
- forward chaining
-- starts with the data available and uses the inference rules to conclude more data until a desired goal is reached
- backwards chaining
-- starts with a list of goals and works backwards to see if there is data which will allow it to conclude any of these goals
- Certainty Factors
-- One advantage of expert systems over traditional methods of programming is that they allow the use of "confidences" (or "certainty factors"). When a human reasons he does not always conclude things with 100% confidence. He might say, "If Fritz is green, then he is probably a frog" (after all, he might be a chameleon). This type of reasoning can be imitated by using numeric values called confidences. For example, if it is known that Fritz is green, it might be concluded with 0.85 confidence that he is a frog; or, if it is known that he is a frog, it might be concluded with 0.95 confidence that he hops. These numbers are similar in nature to probabilities, but they are not the same. They are meant to imitate the confidences humans use in reasoning rather than to follow the mathematical definitions used in calculating probabilities.
-Application of Expert systems
--Expert systems are designed and created to facilitate tasks in the fields of accounting, medicine, process control, financial service, production, human resources etc. Indeed, the foundation of a successful expert system depends on a series of technical procedures and development that may be designed by certain technicians and related experts.
-does not process invoices
-does not process incoming messages
-not a technology that replaces all other technology
-does what other technology doesn't do
-applies human intelligence, experience, and skills that requires high knowledge to solve
-Advantages and Disadvantages
--Advantages
---Provides consistent answers for repetitive decisions, processes and tasks
---Holds and maintains significant levels of information
---Encourages organizations to clarify the logic of their decision-making
---Never "forgets" to ask a question, as a human might
--Disadvantages
---Lacks common sense needed in some decision making
---Cannot make creative responses as human expert would in unusual circumstances
---Domain experts not always able to explain their logic and reasoning
---Errors may occur in the knowledge base, and lead to wrong decisions
---Cannot adapt to changing environments, unless knowledge base is changed
- Types of Problems solved by Expert Systems
--Expert systems are most valuable to organizations that have a high-level of know-how experience and expertise that cannot be easily transferred to other members. They are designed to carry the intelligence and information found in the intellect of experts and provide this knowledge to other members of the organization for problem-solving purposes.


Dr. Jih's comments
-converting tacit -> explicit knowledge is always difficult
-time consuming process
-very important task
-expert can only be present at one time in only one location, once the expert knowledge gets transferred into expert systems its available in multiple locations and multiple times, that is the greatest benefit
-high power problem solving capability
-never forgets to ask a question
-no difference between Monday and Friday
-expert system doesn't get sick or go on strike
-needs to be updated
-keeps on provided high level value information every time you use it
-does not know anything outside of the knowledge base
-knowledge base must be maintained

A New Age of Innovation: Chapter 2

Do chapter two for monday 10/27/08

Info for INFS 3500 class 10/20/08

Exam 2 will be on Oct. 29-next wednesday
Exam 3 will be on Nov. 26

Topics to be covered
1. The Nucor steel article
2. Expert systems case study-definition, system structure,applications, advantages, and limitations
3. "Connected consumers are collectively shaping your brand"
4. Naked Conversations: Chapters 1-8
5. The New Age of Innovation : Chapters 1-2

"Connected Consumers are Collectively Shaping Your Brand"

Social network and how companies can benefit from them

1.ratings and reviews

-best buy for example has a place on the web site where people can talk about their experience and can rate the service as good or bad

-people find peer reviews more compelling that expert opinion

2.social network and online community

-myspace/facebook

-Jeep.com has taken social networking and offers a Jeep photo feed and Jeep video channel

-links to Jeep Myspace and Jeep facebook

3.community tagging/social tagging

-"tag" a key word or category associated with your content

-www.technorati.com

a. folksonomy-the spontaneous cooperation of a group of people to organize information into categories
b. taxonomy-

4. editorial control and user power within the organization

-content "bubbles to the top" based on what users click most 

-track online purchases or research behavior for cross-selling purposes

-"people who looked ay this item also looked at..."

-CNN's most-read stories

-Yahoo's most e-mailed photos

5.Collaborative publishing

-self-policing 

-encourage users to collaborate and contribute product information beyond a basic review

-Amazon.com has a wiki function on its product pages

-customers can add photos and directions 

Naked Conversations-Chapter 8 notes

Chapter 8-Blogs in international cultures
"we are all so different"
"we are all so alike" -The 14th Dalai Lama

Loic Le meur
-cultures express thoughts in the open-french
-chose to be more reserve-German
-Europe's' best known blogger
-disparities between cultures

What?
-Michel Edouard Leclerc France's most popular business leader
-began Blogging in 2005
-criticized by Le Meur
-in a Google search of Leclerc name puller up Le Meur name as number 1 and Leclerc name was number 2

How? Why?
-his blog was first because Lecler has no real blog and no Google juice
-started a real blog and his name now eclipsed Le Meur's
-post loyally everyday
-closer to his customers and employees
-uses a very approachable and genuine tone
-busy guy and blogging gives him a chance to answer FAQ's such as "How do I view the company, the economy, social relations"
-anyone can read these answers

Where Leclerc began
-tried to be as credible as possible
-blog is a public debate
-blog to provide people with answers to questions
-when his population increased he became an addict
-blog can be a tool of influence and manipulation

Other Countries
-2 million bloggers in China
-expected to increase to 10 million by the end of 2007
-Isaac Mao says the numbers are smaller

Naked Conversations-Chapters 7 notes

Chapter 7
"What we have is a failure to communicate"

Press release
-Pr people see themselves as communication facilitators but many see them as spin masters
-How did the industry end up with the tainted image

Honest Bloggers
-straightforward and tell it how it is

Two schools of PR
-command and control-stick to the same communication
-Listen and Participate-understand and willing to change


Blog versus Press Release
-blog is simpler-someone has a thought and they write it down
-pr get amplified by the people who send them

Evolution
-big milestone along the online communications
-has taken PR from big firms

Three ways
-blogs are democratizing the media
-driving corporate transparency
-challenging PR practices

Dr. Jih's comments
-blogger ought to be recognize and ought to be more important
-blogging is their view as a personal heartbeat
-to blog or not to blog
-unless company has a proactive role, blog is not going to work
-moniter the blogs and conversations and join in the dialog then you can control what is said
-have to be able to act and take an issue with it and join in the dialog
-new type of challenge for managers
-much broader and have to work smart

Second Exam 10/29

Last class on the month 10/29

topics to be announced

last test to be announced

sample questions

-contrast difference in advantage and difference and compare blogs to press releases
-how blogs compare to tradional newspaper or publication
-outline key points from each chapter
-chapter 4 direct access
-chapter 6


-read all the chapters and spend 10-15 minutes outlining the key points in the blog

Class notes - 10/15/08

blog=marketing CKM
web 2.0 MKM
information infrastructure EKM

seperation lines are blurring between employees and customers

New MacBooks

The new MacBooks look awesome.

http://tech.yahoo.com/blogs/patterson/28943

Textbook prices

I am appalled by the prices of textbooks. I just bought a Microsoft Access book for $94.25, The Microsoft Office software package doesn't cost that much.  It is ridiculous, how do these universities expect for students to be able to pay for all of this. $94.25 was just for one textbook times that by 5 classes a semester plus tuition and room/board and food expenses and you are looking at a lot of money. 

Class notes 10/8/08

-global village-connected with the world almost like a village
-*participation is the key to success*
-find a network or community to join
-got to make yourself part of the global network
-spend sometime reading and responding to people's blogs
-good advice is to pick up another language
-must go out there and seek opportunities before you have kids and obligations
-many oppertunities in the non-english speaking world

http://www.i-mode.com/ - Japanese company Docomo
http://www.nttdocomo.co.jp/english/corporate/future/hokusai/index.html -watch the video
http://kmspring07.blogspot.com/

-web 3.0 user interface that could be mobile, rich in content, high-definition, 3-D, virtual reality


-Tim O'Reilly "What is Web 2.0" http://www.oreillynet.com/pub/a/oreilly/tim/news/2005/09/30/what-is-web-20.html

Naked Conversations - Chapters 3+4 notes

Chapter 3 notes

Word of Mouth on Steroids
-friends impact us the most
-businesses need to reach mass audiences
-use broadcast marketing to reach a huge audience
-at TV ad needs to only get a 2% response to be adventurous
-interruption marketing
-people have installed mental and technology filters to avoid exposure to marketing noise
-traditional market has become less effective
-new technology has allowed conversational marketing to become prevalent
-they listen to customers and engage them
-nothing more powerful than customer evangelists


-four high school students had invented a buddy system to chat online ICQ
-it was purchased by AOL for 287 million
-1998 AOL IM had 20 million downloads
-What ICQ has done for one to one conversations

Talk is Cheap
-Skype is the most popular Internet telephone service
-used IM and blogs to market their product
-their low cost marketing strategy has been lethal against Vonage
-Skype intends to unseat traditional phone carriers by adding a low-priced paid service
-Skype add new customers for about a penny, wireless carriers get new customers for about $125
-can Skype do without traditional phone company? Not yet because there are still people who don't have computers, so there would need to be a way to connect the phone to the computer
-CPU to CPU

Blazing Foxes
-FireFox an Internet browser reached 25 million downloads in 99 days
-FireFox is more secure than Internet
-Blake Ross was still in high school when he joined the FireFox development team
-he started a blog as an outlet
-each week he announced a new community marketing campaign
-all he had to do was announce it, customers would do the rest
-more websites were linking to the FireFox page than to the Internet explorer site
-people start something new, motivated more by sharing with friends than making money
-viral works best when its home brewed rather than a part of marketing ploy

Passion, Not Echo
-Howard Dean's presidential campaign instead of blogging and reaching a wide audience they were only reaching each other
-other start up are beginning to emulate the antics of FireFox

Remarkable or Invisible
-if a business creates something remarkable then it will most likely be talked about
-the best way is to make something worth talking about
-if the marketplaces doesn't think your product isn't remarkable its not

From Free to Billions
-Google started out with a page with less then 30 words
-used word of mouth to bring customers

The "Awesome-Sucks" factor
-movies spend about 2 million dollars for opening night
-if people who see it and text it sucks people will blog about before
-humans hard wired to want to collaborate and that it can release more levels of dopamine into the human system

Blogging's Key Advantages
-Blogging is a huge word of mouth engine
-blogging can be considered a 2 way street
-find and join the conversation
-feed the network with information

Chapter 4

Direct Access
-allows a more direct access to the customers and can allow a CEO to get the words out
-allows CEO to hear back from customers with greater ability

GM in the Fast Lane
-can be good or bad for companies
-gives direct feedback
-customers could also give false facts
-the Blogosphere can also acts as its own policing agency

Moving the Whole Damned Compass
-blogosphere is a good place to meet people
-1000 out of 32000 of his employees are blogging
-Sun's Microsystems encourage people to cut their own paths

Participation Age
-blogs are a part of the participation age
-been on the net since e-mail
-way to bypass journalists
-provides transparency and authenticity
-gives outsiders inside views
-legal team never doubted blogging at Sun
-Pr teams though it was a great idea as well


Maverick Blogger
-Mark Cuban
-co-founded broadcast.com
-sold his website and bought the Dallas Mavericks
-started blogging about his team
-his blogs offset about him and his team
-only interviews through e-mail

Bypassing Media Mythology
-Dave Winer head of the software company UserLand
-press reports mythology, not facts he says
-Spam has hurt e-mail
-RSS feeds (really simple syndication)
-Netscape made the same thing at the same time

Doing in in Private
-internal blogging, behind a firewall, to 86000 Intel employees
-Intel CEO Paul Otellini
-confidential information is sometimes intentionally leaked
-Intel didn't leak on purpose but people thought it did
-IBM also has internal blogs-over 3000 of them

Naked Conversations- Chapter 2 notes

Dave Winer- simply playing around with technology and organise a series of entries in a new way

Speed of Adoption
- number of blogs have been doubling every 5 months since 2003
-1/4 of web users read a blog
-20 million bloggers world wide

-personal website with content displayed in chronological order
-linking blogs together leads to a blog sphere
-blogs inspire controversy
-blogs allow customers to see who the person is on the other side
-the more you talk with someone, the more you trust them

1. Publishable
2. Findable-through search engines
3. Social-the blogsphere is one big conversation
4. Viral-informations spreads faster through blogs
5. Syndicatable-by clicking on an icon you can get free home delivery on RSS-enabled blogs
6. Linkable- blogs can link to millions of others

-blogs can secure a high google ranking
-shortest, cheapest, and fastest way to get a high ranking on google

Naked Conversation- Chapter 1 notes

Chapter 1 powerpoint using google docs.

http://docs.google.com/Presentation?id=dggzsmkh_0c7xd4whr

Notes:

If you put a webpage/blog page address attached to you resume employers will go to it and it might be how you get the job. Its very easy for a resume to get pushed to the side but if you give them something to look at they might be more inclined to look at you again. Resumes are limited in their scopes.

Crappy Days

I have had a crappy couples of days. I just found out today that my grandfather is on life support and probably won't make it out of the hospital.

INFS 3200 exam monday 10/6/08

Protection
Chart
Filter
Functions - min, max, sum, if, nested if
Formulas
VLOOKUP
Payment function-PMT

Google Docs

I tried using google docs for my chapter 1 presentation and found it to be very annoying to use. Internet Explorer kept having problems running the web page and when I made the presentation on my mac book it opened differently on a pc. The slides were easy to write out but hard to format.

Los Angeles

So far my time in L.A. has been amazing. Today I visited the set of scrubs and crawled in a morgue drawer! It is sad however the whole set has basically been torn down inside so its barely recognizable. Tomorrow I am going to a party for the show its amazing!

Chapter 7

I have no idea what chapter 7 is saying. It took me an hour just to read it, studying for this test is killing me.

Order books

Order the books, will be covering the books after the first test


1. The New Age of Innovation: Driving Cocreated Value Through Global Networks by C.K. Prahalad and M.S. Krishnan, McGraw-Hill, 2008.
2. Naked Conversations: How Blogs are Changing the Way Businesses Talk with Customers by Robert Scoble and Shel Israel, John Wiley & Sons, Inc., 2006.

Lecture notes are on the "S" drive-print them out

Correctional Management

Correctional Management test Tuesday September 23, 2008 at 1:00 pm

Material on Test

Materials covered:

1. Knowledge economy (wikipedia)
2. Knowledge and competence as strategic assets (handout)
3. Collaborative advantage (handout)
4. Just-in-time delivery of knowledge (handout) -hospital study
5. Hallmark cards (handout)
6. BP Amoco (handout)
7. Customer-driven innovation

4. Discuss how information technology makes physicians work more efficiently and how it protects patients. How to produce win-win results
5. Knowledge communities involve customers in the design process and in the commercialization stage
6. Promote intra-organizational communication/collaboration and support competitive advantage
7. Published in 2001, ideas are still very good. www.innocentive.com

All essay questions, closed book exam, look at each piece at least twice

Organization is the key to performance, its the core to information management

Hollywood!

10 days until I am in Hollywood. I can't wait, its going to be awesome!

Knowledge Management Exam

First exam is monday 9/22/08.

Exam: Read everything that he has handed out, all the articles and group presentations

Essay format

Typed out or handwritten

Dead MTSU student?

I just went on The Daily News Journal's website and saw a link that a MTSU student died on campus last night. Why didn't the school send out an e-mail? I thought information like that was part of MTSU's public notice policy? I for one would have liked to hear that information from the university not a local newspaper.

RIP Noah Ewekunle

HOLLYWOOD!

I just found out that I am going to Los Angeles at the end of September, I am so excited!

What is wrong with students at this school

MTSU sophomore charged with rape

A 21-year-old sophomore at Middle Tennessee State University in Murfreesboro was arrested Friday and charged with rape after a fellow student reported the sexual assault to police.

The 21-year-old victim told police the incident occurred at the Alpha Tau Omega fraternity house on MTSU's campus.

Although she was not severely injured she told police the sexual contact was not consensual.

Garrick Hock, who the victim said she knew prior to the assault, was arrested by MTSU police and later transported to the Rutherford County jail Friday.
 
The incident remains under investigation.

First the parking spot incident and now this?