Ayman's Reflections on Project and Systems Engineering, Architecture, Management and Leadership

Strategy and its Role in Becoming Capable

2009-11-11T09:42:00.006-05:00

Strategy is focused on the matching of an enterprise's opportunities and threats (external factors) to the enterprise's capabilities.

In some cases an organization might not have a capability in place that allows it to benefit from an opportunity. In such cases the capability will need to be realized otherwise the opportunity will be missed. The realization of such absent capability is part of the enterprise strategy, and will require enablers from across the enterprise such as technology, locations, roles, processes, intellectual property and more.

__________________________________________
Robert Grant, "Contemporary strategy analysis: concepts, techniques, applications", Blackwell Publishing, 2002.

Harvey Thompson, "The Customer-Centered Enterprise: How IBM and Other World-Class Companies Achieve Extraordinary Results", Mc Graw-Hill, 2000.

Getting Capable

2009-11-10T16:03:00.002-05:00

Institutions vary widely in their capabilities to achieve their mission. You could find two organizations in the exact same line of business, with very similar strategies and business drivers, yet very different results due to the differences in their capabilities. Lets take an example of two airlines. Both airlines share the same mission, transporting humans across the globe safely and in an enjoyable manner. Airline A always takes off on time, lands on time and does not lose luggage. Airline B always takes off late and loses luggage.

Their business requirement is the same, yet their outcomes are very different, which is due to differences in their capabilities.

A capability is a realized requirement, it could also be said that a capability is a business requirement added to some value acquisition process. The value acquisition process should span the entire enterprise to ensure that is picked from all strengths of the enterprise and also did not bring along any unnecessary baggage.

Organizational Capabilities in Less than 100 Words

2009-10-28T16:37:00.004-04:00

How quick can your organization respond to its constituents needs. How effective can it adapt to changing dynamics in the environment surrounding it? How efficient can it deliver its mission? The answer to these questions depends on what we call organizational capabilities.

Similar to an individual's ability, organizations have abilities to do certain things, these abilities combined with resources, assets, processes and skills form an organizational capability. A few examples of strategic capabilities are (1) The ability to innovate and be creative, (2) the ability to develop and deploy products in a compressed cycle, and (3) the ability to educate and train young people.

Are your capabilities well defined? Do you know how to improve them, and how to measure where these capabilities are enabling your stakeholders to realize the value proposition you are offering?

Know Thy Business Events

2009-10-26T15:32:00.002-04:00

A business event is a valuable building block in an enterprise's business architecture. Business events provide insights to triggers and decision points in the business domain. Business events could be classified into three types: External events such as a customer service request, internal events such as closing a project or an employee time sheet submission, and finally temporal events which occur based on the elapse of a given time-frame such as end of month.

There are many important questions to ask oneself about events when building a business architecture or when defining events. Examples are:

1. How are these events identified?
2. Are they unique?
3. Can they be repeatable?
4. How can we structure events in the context of a business architecture?
5. How can events be modular?
6. What processes are related to events?
7. What business capabilities are impacted by events?
8. What impact does the event have on the business services, operations and other areas?
9. Who reacts (which roles) to an event and in what way?
10. How often does an event occur and what is its significance?

Step By Step Business Architecture

2009-09-08T15:21:00.004-04:00

Developing a business architecture for an enterprise can be a daunting task. However following a systematic approach makes it a bit easier, or at the very least organized.

1. Develop a description of the existing business architecture if it exists. The description should include as much of the AS-IS architecture as needed for the development of the TO-BE architecture.

2. Identify any reference models, tools, patterns and techniques that should be used to develop the TO-BE architecture based on the context, complexity and scope of your business requirements.

3. Select viewpoints of the business architecture to be utilized to illustrate the architecture, according to the business requirements. Common business architecture view points are operational, systems, technology, governance, financial and functional viewpoints.

4. Develop an architecture model for your TO-BE business requirements. Ensure that you perform each of these,

Create the model for the specific view point. For example create the activity model for an operational view point of the business architecture. Common models are activity models, use-case models, class models, node connectivity diagrams and information exchange matrices.
Verify that all stakeholder requirements and concerns are included.
Ensure you have models for business goals and objectives, business functions, business services, business processes, roles, business data,
Ensure your architecture has captured the interlocking of organization and functions, and interlocking of processes and systems.
For each business function identify when, where, where, how often and by whom will the function be performed. Identify the inputs to the function and the expected outputs.
Identify dependencies and assumptions for each business function.
Conduct trade-off analysis if any conflict exist among the different views.
Validate and verify the developed model against requirements for completeness and scope

5. Select the business architecture building blocks (a.ka. business component model - CBM). Reuse blocks as applicable, and develop new ones to add to the CBM library.

6. Hold a formal architectural review of the developed model and building blocks with the stakeholders.

7. Review the non-functional requirements and service level agreements. Common non-functional requirements are scalability, performance, availability, costs, reliability and capacity.

8. Complete the documentation for the business architecture by ensuring that you,

Have a completed requiements traceability report.
Identified requirements that are driving the architecture.
Mapped the architecture to reference architectures and models in the organization.
Identified new vs. reused building blocks.
Documented rationale for architectural decisions.
Completed the business architecture report including the business footprint, detailed description of business functions, and their information needs.
Outlined the governance footprint as related to the business needs and scope of the TO-BE
Included a table of standards, rules, guidelines, assumptions, dependencies, and measures used.

Business and Enterprise Architectures: Differences and Commonalities

2009-09-08T12:45:00.003-04:00

Business architecture is a unifying structure that enables the execution of business strategies through initiatives to achieve business results. The business architecture could also be viewed as the relationships and connectivity among the various value streams and the inputs that feed these value steams, the processing centers that enable the value streams and the value realized.

Business architecture is only one component of enterprise architecture. In an enterprise there are business objectives, technology and infrastructure assets, organizational units, security concerns information handling and processing and various other components, each of which can be defined as a separate architecture and part of a defined framework.

The business architecture encompasses the business flows, activity models, use cases, user models, class models, node connectivity diagrams and business information exchange matrices. Business architectures usually reflect a baseline known as the AS-IS architecture and defines a future aspiration known as the TO-BE architecture.

Enterprise architectures explain all aspects of an enterprise; its data, business processes, infrastructure, technology and business

Patterns: What Are They? Part 1

2009-08-12T15:29:00.007-04:00

Literally patterns are defined as a combination of qualities, items, objects, behaviors, or other which form a consistent or characteristic arrangement. We observe dozens of daily patterns every day. Examples are teen behavior, the movement of the earth around the sun, the blooming of flowers and hundreds more.

"A combination of qualities, items, objects, behaviors, or other which form a consistent or characteristic arrangement"

Patterns are not new to man-kind, the Creator has informed us about patterns in the Quran and other earlier revelations. Recently system developers started to analyze the concept of patterns, pioneered by Christopher Alexander in his book, " A Timeless Way of Building", he defines a pattern as a three-part rule, expressing a relation between a certain context, a problem and a solution.

Patterns are a first step in understanding root causes of the problem within a specific context. It also allows the development of architectural and solution building blocks.

"In systems realization, patterns express a relationship between a problem and its solution within a given context"

For a software designer some pattern examples are: Message Translators, Process Managers, and Proxies to mention a few. A process manager pattern for example will comprise of a sensor to detect an incoming message which initializes the process manager. The process manager in turn executes a set of rules stored in the process manager memory implementing the processing rules, and detects the subsequent steps through a status feedback detector/analyzer.

Considering a different domain, take the example of a group that does youth trips, examples of patterns could be: Headcount Process, Critical Supplies, Meal Managers, Activity Itinerary Manager and many more. An Activity Itinerary Manager pattern will comprise of an input process to capture developmental and coaching themes/needs of the youth trip, a search process to match the theme to a group of activities that meet the objectives of the theme from a repository of activities, the selected lists of activities could then pass by the activity processor which breaks down the activity into steps, each assigned to resources, a lead, a cost structure, risk factor and plan of action. Feedback from the actual deployed activity is then finally fed back into the activity manager for updates to the activity definitions and other relevant areas, within quality expectations.

_____________To Read More _______________

(1) Hohpe and Woolfe, "Enterprise Integration Patterns: Designing, Building and Deploying Messaging Solutions", Addison Wesley signature Series, 2004.

(2) Haskins and Raveh, "Introduction to Patterns Through Writing Systems Engineering Patterns", 16th Annual International Symposium, 2006.

(3) Gross and Yu, "From Non-Functional Requirements to Design Through Patterns".

The Spark ...

2009-08-04T12:41:00.009-04:00

Teamwork is touted as the driver behind progress. This is not necessarily true. There is no doubt that teamwork is a fact of life. As humans we have to interact with one another to satisfy our human needs and desires such as socializing, belonging to a group identity, sustaining needs of life among many others.

Effective teams need leaders to align them and give them direction and motivation. The spark that makes groups and societies move is the outcome of individuals. These sparks ignite the team and thrust its members forward, but the team members do not necessarily produce any starting sparks. As Igor Sikorsky once said,

"The work of the individual still remains the spark that moves mankind ahead, even more than teamwork"

If you find yourself on a team, organization or society, with higher levels of motivation, vision and commitment than others, don't despair, that means you are a leader. As a leader you can not work alone, sparks don't develop into fire without a catalyst, and your team is your catalyst. Nurture, coach, and develop the team, and it will be a strong catalyst.

It was once said that a small group are the ones carrying the ambitions of the nation, and a group of those are the ones who sacrifice their time and wealth to accomplish these ambitions, and a group of that smaller group are the ones who sacrifice their lives for the sake of succeeding in the accomplishment of these ambitions. A small group, from a small group, from a small group.

"A small group, from a small group, from a small group"

______________________

Picture: Courtesy of NASA: The formation of a star, A molecular cloud is a region containing cool interstellar gas and dust left over from the formation of the galaxy and mostly contains molecular hydrogen. The Spitzer data, in red, green and blue shows the molecular cloud (in the bottom part of the image) plus young stars in and around Cepheus B, and the Chandra data in violet shows the young stars in the field. http://www.nasa.gov/mission_pages/chandra/multimedia/photo09-062.html.

10 Attributes of a Learning Oganization

2009-07-16T10:40:00.005-04:00

Communications is a key component of effective leadership. Leaders don't sit in their offices behind their desk, they are out in the field dealing with customers, suppliers, employees and other constituencies of their organization. This interaction between the leader and these other groups and individuals yields tremendous amounts of experience and knowledge. An organization which shares knowledge and learns from its members is a learning organization.

Learning organizations are characterized by the following:

1. Possess solid systems for communications among its members.
2. Knowledge and intellect is respected and appreciated.
3. Team work and collaboration is the norm.
4. Members consult one another on a continuous basis.
5. Members update others on a continuous basis.
6. Teams learn from past experiences, and mistakes are rarely repeated.
7. Information, knowledge storage and retrieval is efficient and effective.
8. Team members are accessible and known for their expertise, contributing to centers of competence.
9. Realizes continuous growth and innovation.
10. Encourages diversity and systems-based thinking.

Is your organization a learning one? How can you assess its learning capabilities?

Instilling Change: A Key Component of Leadership

2009-07-14T00:47:00.006-04:00

Leading change is by no means a trivial job. Only the experienced leaders with astute vision can lead their teams to change. The Prophet Mohammad (peace be upon him) is a role model for not only change, but transformation.

Our Creator informs us that no group of people will change unless they take initiative to embrace change themselves. Indeed the only things that is constant is change itself, or as Muslims know it as the sunnah of Allah (ways of Allah).

Scholars of management [1] define a few steps which are key for successfully leading change. I summarize these points [2] and provide references from the Quran and teachings of the Prophet (PBUH).

1. Intention:
Quran: Indeed Allah does not change the condition of a group unless they change themselves.
Hadith: Indeed deeds are based on their intentions

2. Urgency:
Quran: So flee to Allah quickly indeed I am to you from him a clear warning
Quran: And hasten to a forgiveness from your Lord and a paradise the width of the skies and earth

3. Clear Vision:
Quran: And Indeed Allah is my Lord and your Lord, so worship him, this is the straight path (Mary 36)

4. Stick to a Good Team:
Quran: And seek patience in your soul with the ones who remember their Lord in the early morning, and the evening late at night, seeking his pleasure and acceptance (Cave 28)
Quran: Wow to me, I wish I have not taken him/her a close companion (friend) (Al-Furqan 28)

5. Self Critique Self:
Quran: Oh you who believe fear Allah, and shall a soul see what it has prepared for its tomorrow (hereafter), and fear Allah, indeed Allah is with what you have performed all knowing
Hadith: Seek forgiveness, for indeed I seek forgiveness 70 times in a day

6. Take Action and Perfect it:
Hadith: Indeed Allah loves if one of you do an action, that you perfect it

7. Be Consistent:
Hadith: The best of deeds are the continuous, even if they are little

8. Take Small Steps:
Hadith: This way of life (Islam) is deep so get in it slowly and gently

9. Don't Give Up:
Quran: Tell my servants who have transgressed upon themselves to not despair from the mercy of Allah, indeed Allah forgives all the sins.

10. Offer Value and Increase Benefit:
Good deeds wipe out bad deeds

11. Ensure You are Working on a Sound Foundation:
Fix your beliefs and values
Quran: And Satin said when the matter was over (life on earth, and the day of judgment), indeed Allah promised you the promise of truth, and I promised you and broke my promise, and I had no power over you, except that I invited you and you accepted, so do not blame me, and blam yourselves. (Ibrahim 22)

12. Set and Realize Realistic Goals
Quran: Indeed Allah does not burden a soul with more than what it can handle

13. Stay Away from Distractions
Quran: Do not even come near fornication
Quran: So flee to Allah

14. Remember Your Mission in Life:
Quran: I have only created jinn and mankind to worship me
Quran: Is it not that with the rememberance of Allah that hearts have tranquility and content

15. Remember Life-cycles End:
Hadith: Remember the destroyer of all pleasures (death)

16. Never Execute Trivial Work:
Hadith: A human's accountability on the day of judgement will not be over until he is asked about four things, from among them is his time and how he utilized it

17. Forecast Risks:
Quran: Indeed the plotting of Satin is weak
Be vigilant and forecast problems and risks

[1] Dan Cohen and John Kotter, "The Heart of Change Field Guide", Harvard Business Press, 2005.
[2] Ayman Nassar, "Implementing Change", Friday Khutbah, Hanover, PA, July 10th, 2009

The Demise of Quality - My Wife's Friend, British Airways and Air France

2009-06-22T08:32:00.003-04:00

I was vacuuming the living room last evening, when my wife told me that her friend arrived safely in Egypt after a long flight from Washington with a connection in London. She then added that her 10 year old son is walking around in his swimsuit at home and her friend is wearing some old maternity clothes she had from a decade ago. I asked my wife "Did they lost their luggage?", she replied that no a single bag of the eight pieces her friend and her three kids had arrived.

It has been two days since my wife's friend family had arrived on board British Airways with no luggage. I mentioned to my wife that her friend should request a compensation of some sort, may $100 per passenger, so they can use this modest pocket money to go buy some clothes until their bags appear. My wife's response was "we are thankful that they arrived safely". Well, yes of course compared to Air France's latest flight that plunged in the Atlantic, the losses and inconvenience is minimal, and one should always be thankful, regardless of what one goes through". The point however is that the passenger's (customer) expectation is be transported safely along with his luggage from point A to point B. If customer's start changing their expectations, quality will automatically by definition change.

An attorney would seize the opportunity and ask the passenger to file a suit against the airline asking for some ridiculous amount of money as a compensation for damages. Maybe $1 million dollars per lost bag, or the highest that the court will allow. We have various mindsets of customers when it comes to settling disputes with a service provider. At one extreme a client will say no problem, just get me my bags if you can, when you can. On another extreme another customer will say meet me at court, and then there are infinite of perspectives in between.

What would you do? What would a good system's engineer do? Share your thoughts in the comments below.

Probability Distributions for Business Events - Binomial

2009-06-03T21:00:00.005-04:00

System engineers and technical managers need to make decisions based on the probability of certain events occurring. For example during a risk assessment practice, the systems engineering might be calculating the risk value of an event, and based on the value of the risk level the organization will take certain steps to respond to the risk.

To accurately calculate the risk value which is calculated as the (impact level * probability of occurrence), the probability distribution selected needs to be accurate.

In some events outcomes could be binary, for example: good or bad, correct or incorrect, successful or failed, conforming or non-conforming. A suitable probability distribution would be a binomial probability distribution, using a binomial calculator the system engineer can calculate the probability of occurrence of one of the two possible events knowing the sample size (n), the rate of good versus bad, or correct versus incorrect (p) and the number of items (x) fitting a particular outcome. For example if we select a sample of six items from a batch which has a defect rate of 3%, we can find the probability that the sample has one defective item using the binomial formula

P(x) = [n! / x! (n-x)! ] p^x (1-p)^(n-x)

In the above example, n=6, p=0.03, x=1

Using the formula above or the binomial calculator available at Texas A&M, we get that P(1) = 0.1546

Stay tuned for other probability distributions that are also common in business environments.

Two Approaches to Use Statistics on Your Project

2009-06-01T19:53:00.005-04:00

Most people don't like statistics, and most decision-makers make wild guesses when they need to take a decision. Statistics might not be the most straight-forward science during the college years, but it has tremendous value in providing insights and guidance for making rational decisions.

Using statistics one can show various properties of a set of data such as the mean, mode, median, dispersion and distribution. These parameters can be represented graphically using histograms, charts and other visual illustrations.

Another approach using statistics is to develop inferences, test hypothesis and develop forecasts through the use of sample data from a bigger population. Relationships between variables can be developed and illustrated using a scatter diagram or a regression equation.

Six Sigma's DMAIC vs. Design for Six Sigma's IDOV / DMADV

2009-05-31T11:44:00.006-04:00

Six sigma's success is mainly contributed to its DMAIC model. The DMAIC model focuses on defining an issue with an existing process or product, measuring the deviation from the expected behavior, analyzing the data for insights to root causes, improve the current process or product through minimization of deviations or improvements and finally controlling the system to sustain the gains achieved.

IDOV and DMADV which are two design-based models slightly differ from DMAIC as follows.

Objective and Approach: DMAIC views the current process or product as correct and economical, but needs to minimize some gap leading to inefficiencies. IDOV / DMADV view the current process or product as in need of redesign or design change to achieve customer satisfaction.

Process Capability: DMAIC views current process as capable of satisfying customer needs, whereas IDOV / DMADV views current processes as a candidate for improved yield regardless of volume and complexity.

Design: DMAIC views the current design as satisfactory for the client's needs, whereas IDOV / DMADV views the need to consider various drivers for design, such as cost, manufacturing, producibility, maintainability, robustness, usability, efficiency, security, agility, compliance and testability.

Flexibility: DMAIC assumes that the current design and processes are flexible to meet customer demands and needs, whereas IDOV / DMADV highly considers potential customer demands and forecasts newly developed needs

Validation: IDOV and DMADV both consider validation and verification of the outcomes of a design or process in meeting objectives.

To read more:
[1] Chrisitian Madu, "The House of Quality in a Minute", Chi Publishers, 2006.
[2] Rod Munro, "The Certified Six Sigma Green Belt Handbook", Quality Press, 2008.

3 Practices to Becoming an Agile and Lean Enterprise

2009-05-20T10:53:00.008-04:00

About a month ago I was approached by a client asking to give advice regarding some organizational changes and major layoffs they were embarking upon. The client sent me an email with about six or seven different options to pursue to cut on their operating expenses.

I noticed that all the options were focused on eliminating employees. My question to myself, if eliminating employees seems the favorable and only approach that comes to mind, why were these employees present in the first place? There must have been a need for them in the organization, otherwise why were they hired in the first place? What operations will suffer when these folks are let go?

Many businesses fail to realize that a lot could be done way in advance to avoid shedding off employees. Letting go of your most valuable resources, your staff, should be the last thing to do, before closing shop. I list ten actions that can be done months before the crunch becomes severe to be forced to shut down.

1. Reduce non-valuable activities, a.k.a trivial work.
Non-valuable activities are those which your customers are not willing to pay for, they do not change the form or function of the product or service they are interested in. An example is rework, due to defects in a process used to produce the end product or service. Other examples are wait-time during the process. For example if you order a book online, you are willing to pay for the book to be shipped from the publisher to your location, you are interested in how much time it takes the book to wait at each regional hub for its next pickup. If there is a cost to the shipper to pay for the time spent at each shipping hub it will increase the cost of your book shipment and will not provide you any value. The only value you realize is the book being shipped to you as fast as possible. Instead of focusing on accelerating valuable processes, one should first eliminate non-valuable processes, as the effort of work will probably be less and the outcomes more effective.

Muslims also know non-valuable activities as "Lagow", an Arabic term mentioned in the Quran in several places, as deeds that have no benefit, or are a mere waste of time. These are deeds that keeps one's focus away from his purpose in life, which is the success in the hereafter.

Before improving valuable processes, it is important to get rid of as many non-valuable processes as possible. In the case of my client, they were focussing on products that yielded low profit margins, were difficult to market, promote and sell, and required large staffing and overhead.

2. Reduce waste
Waste is all around us in our activities. It is imperative that before we develop new processes to improve deficiencies we actually reduce waste as much as possible. Waste could be due to over production, excessive steps due to complexities of processes, queuing and idle time, defect correction and rework, poor organizational and planning processes, lack of controls and creativity stagnation.

Through some auditing and analysis it was found that my client had opportunities to reduce expenses of photocopying, utilities, rent and other non-valuable activities prior to let go of employees who were driving valuable activities for the end user.

3. Use facilitation to reduce cycle time and enhance efficiencies
A facilitator who is neutral to the different entities in your enterprise, and who has no authority or decision-making control, can bring tremendous value to your organization. The facilitator can apply collaboration concepts, systemic approaches and architectural thinking to decompose problems, address impacts in all areas of interest, and ensure a collaborative environment exists where the various team members can share ideas, brainstorm and foster creativity.

Controling Many Small Changes: Taming the Culprit for Most Accidents or Failures

2009-05-18T23:17:00.006-04:00

As changes creep upon our processes, methods and systems; we accumulate little bits of inefficiencies which eventually become large and cripple the system.

Six Sigma helps ensure continuous improvement, through the use of data collection to analyze and understand how a process works or changes. The focus in this case is to reduce variations to processes or design ultimately leading to less defects. Common approaches to identify these variations or deltas is through the voice of the customer (VOC), quality function deployment (QFD), failure mode effect analysis (FMEA) among many others.

Lean improvement approaches can also help address change creep consequences. The focus in this case is more on waste minimization and elimination. Common approaches are value stream analysis, the five S, Kaizen events, just in time, work standardization and error proofing.

__________________________

Picture: The Nile Delta in Northern Egypt. Image depicts delta erosion.

Feedback: A Core Component of a Successful Process

2009-05-18T18:31:00.008-04:00

Processes comprise of a functions which operate on inputs to produce outputs. Data associated with the inputs and outputs can be used to further enhance the process quality. The data related to the process outputs could include important elements that when fed back to the input within a solid analytical framework could offer valuable insights and impacts on the process improvement.

Several key steps in designing the appropriate data collection, analysis and feedback system are summarized below:

1. Decide where to collect the data
Data can be collected at the input, various processing points, decision-points, at the output or any combination of all of these locations.

2. Decide what measurement systems to use
Various techniques exist to collect and measure data. Decisions need to be made on best statistical approaches, summarization techniques, collection methods and the levels of accuracy and precision needed.

3. Decide how to analyze the data
Approaches of data analysis need to be determined. It is important to determine cause and effects, root causes, correlation, regression dependencies and other relationships among the various variables and factors.

4. Decide on how to use the information resulting from the data analysis
Decisions related to the application of the information learned is important. For example will information be applied in real-time, or after process reengineering is brainstormed.

The Cruiseterminal - The World's Floating Dock

2009-05-18T09:22:00.004-04:00

Even by Dubai's standards the Cruiseterminal is an extravagant project. Rigged to a foundation in the Persian Gulf it can host three of the largest cruise ships. Its an integrated system comprising of its own photovoltaic electricity generation subsystem, an entertainment and retail subsystem, a 180 room lodging subsystem, docks for tens of smaller boats.

A system such as the cruiseterminal brings new challenges not only to system design and development, but also system operations, support and maintainability.

To check pictures of the Dubai floating Cruiseterminal among other structures, check De51gn at http://de51gn.com/design/the-floating-world-of-koen-olthuis/

Using the Theory of Constraints & Six Sigma to Fix Critical Components of the Economy

2009-04-29T10:02:00.012-04:00

Constraints are all around us. The theory of constraints is a lean problem-solving concept based on a simple concept, that a process can not move faster than the slowest part of the process.

Our economy as a complex enclosed system has constraints and it will respond to stimulus as quick as the slowest link in the economy. The chart on the left illustrates some major components of the economy. They all need to be improved for the stimulus to realize benefits, otherwise it will be a temporary patch.

The root of the problem lies in three areas:

1. The concept of printing money and the process followed to release cash into the market. The Federal Reserve Bank - which is not a government entity - is provided the authority to distribute the nation's currency and supervise banks which are members in the system. When the US releases currency into the market it requests the Federal Reserve Bank to print dollar bills in return for an interest payment on the amount. No real assets are provided as collateral to backup the value of the printed currency. The value of the currency is only backed up by the reputation and promise of the US government to accept the currency as a form of payment. As users of the currency lose faith in the governments ability to keep the promise the value can drop significantly. One reason for the poor confidence in the currency, is the automatic depreciation of the currency the day it was printed. For every US dollar printed a small percentage is due to the Federal Reserve Bank as interest on that printed dollar, in a sense every dollar released into the market is really worth 0.98 of a dollar, if we assume an interest rate of 2%. Add onto this, the fact that the US government is running into a non-stop deficit in social security, and other areas leading to increase in bond issuing to countries such as China and India, further diminishing the value of the US currency.

2. Interest rate or usury is another problem in the overall system. The fact that currency value depreciates today based on some future value determined by an interest rate automatically leads to inflation, and future depreciation of natural resources. Charging interest is like pumping steroids into a body builder, eventually at some point the body will collapse.

3. Selling what we don't own. The idea that goods and services can be sold without actually owning them creates a virtual commodity system, not backed up by real commodities or assets.

Unless these areas are fixed no stimulus package can work on the long term. Some simple steps to address this issue are:

a. Identify the constraints of the financial and monetary systems
b. Exploit the constraint or re-engineer
c. Subordinate other steps in the overall process to the improved constraint
d. Revise the constraint if it has not been eliminated by steps b and c
e. Repeat the steps above for other constraints

Applying this into practice can be as follows:

a. Identify the constraints of the financial and monetary systems
- Currency not backed by a true tangible asset (some natural resource like gold or silver)
- Currency being depreciated the day it is printed, solely due to interest
- Distribution and sale of products that do not exist (example lending money to a business when the bank does not have the exact cash reserved, selling a commodity that one does not own and has not yet paid for)
- Using interest rates to discount projects, assets and commodities to a future value, leading to valueless future assets, commodities, natural resources

b. Exploit the constraint or re-engineer
- Re-engineer the monetary system that issues a currency based on a true asset and not just a promise
- Re-engineer the concept of future valuation
- Re-engineer the concept of wealth circulation

c. Subordinate other steps in the overall process to the improved constraint
- Use a sustainable natural resource to backup the value of an issued currency
- Use joint partnerships, gifting (0% loans) and entrepreneurship, moving away from interest bearing loans of money that is not owned by lenders.
- Base future valuation on true-value (value proposition) provided to global society rather than a discounted interest rate.

d. Revise the constraint if it has not been eliminated by steps b and c
e. Repeat the steps above for other constraints

One Way to Ruin a Great Product Idea - When Design and Implementation Miss

2009-04-27T14:59:00.010-04:00

A friend of mine sent me some interesting pictures for projects that might have seemed successful on paper, when in implementation they failed. This is where a systems engineer comes in handy, in cases like these.

A Financing System for Prosperity, Growth and Social Justice

2009-04-18T14:45:00.005-04:00

My dear friend Mohamed El Habashy sent me a link to an interview that he was part of on PBS. He was one of several experts interviewed on hot topic of Islamic financing. It seems that the World suddenly woke up to realize that a system that was revealed to mankind some 1430 years ago is now all the sudden a good choice.

The Islamic financing system is based on one of three main models:

- Mosharaka (joint ownership through stocks, capital partnerships)
- Qard Hasan (good lending, a loan with no interest (0%) regardless of amount and maturity date)
- Mudaraba (entrepreneurship or partnership with effort and experience)

Several key concepts in Islamic financing are

1. Joint sharing in risk and reward (property/asset price increase and decrease) - is part of the definition of ownership in Islam, and it provides responsibility and fairness to all parties.

2. The concept of selling money (lending with interest) is prohibited. In Islam lending money as a form of investment is prohibited and not in compliance with the Islamic Shariyah.

3. Sales are only acceptable on items owned. This means someone can not sell an item (product, service, shares, commodity, etc..) unless he has paid for it in full and has full control on it. In Islam a person selling stocks that he never paid for is prohibited and not in compliance with the Shariyah.

As of today there are no 100% Islamic compliant financing vehicles in the US, the efforts mentioned above in the PBS article are good and trying to strive to get close to the fair and just Islamic financing. However due to regulations and other factors there are some gaps, such as the joint risk sharing in a partnership model. Islamic financing has been around for 1430 years from the days of Prophet Mohamed and it is implemented in many parts of the World (UK Links: 1, 2, 3, 4, 5) we in the US are just behind. There is a US institution that has started offering some Islamic vehicles.

There is no question that Islamic financing is fair, just and solid, providing fair social rewards to all parties involved, unlike other means of financing. Islamic financing can be used by non-Muslims as well whether they decide to fund or use the system.

Usury/interest was prohibited not only in the Quran, but Jesus and Moses were ordered to tell the people to not engage in usury. (proverbs 28:8, Ezekiel 18:8, Exodus 22:25)

Finally America Might See a High Speed Rail System

2009-04-17T15:47:00.004-04:00

It's not about time that America gets a high speed rail. It is way past due. Japan had one for decades, and Europe has been there, did that ages ago.

These days there are discussions about two impressive high rail initiatives worth mentioning. In the West Obama is pushing for $13 billion ($30 billion total cost) high speed rail system (links 1, 2, 3) in California and the heart of America's Mid-West, Chicago, my favorite city. In the East King Abdullah is launching a high speed rail route between Makkah and Madinah.

Wikipedia has compiled a list of high speed rail projects across the globe. The Saudi project is impressive as it has the least cost / mile worldwide. The American is impressive because it is the first in the Western Hemisphere and second fastest worldwide reaching a little over 150 miles / hr.

Now here is the big project. China's high speed rail, the longest worldwide reaching over 800 miles and exceeding the American train speed. A really neat chart showing the world's top high speed projects can be found at infrastructurist.com by Yonah Freemark.

So the questions that pop up are: Why did it take America too long to initiate such a project? Will it be a success or another Acela (links 1, 2). Successful system development is contigent on many factors some of the critical ones are policies, supporting infrastructure, overall cost, stakeholder value proposition.

So why do I consider Acela a failure ( 1, 2)? Well, for one it was a very expensive system, secondly, it did not take away much volume from other modes of transportation. If it takes me an hr to drive from my home to get to an Acela station in Washington DC so that I can get to New York City in a couple of hrs, I might be better off driving up to New York in 2.5 hrs and pay less in gas and have the convienence of my own transportation in all the other pockets of cities and suburbs that lack public transportation. Just one of many aspects of the overall system that needs to be considered.

The boundary of a high speed rail system does NOT stop at the tracks, it goes beyond the tracks and stations to the supporting infrastructure that will allow people to get to the high speed stations, use the facilities and services within the service levels and value proposition a stakeholder will expect.

New PMP Practice Book Released Today

2009-04-16T17:26:00.009-04:00

I just received a proof copy of my new PMP practice book today. The book is a great tool for those who prefer the self-study route. It comprises of 15 chapters covering the concepts of project management, a project's life cycle phases, process groups and project domain areas (scope, schedule, cost, risk, communications, risk, procurement, quality, human resources and integration). It also includes a chapter on professional responsibility, and a chapter with extra 130+ questions. The whole book offers over 420 practice questions very similar to the exam. The book is not a study guide (it does not have content to study, just problems to practice), it does have a chapter on how to prepare for the exam and various tips ranging from "how to get to the test center" to "how to respond to questions"

It can be purchased online from https://www.createspace.com/3380201 or from Amazon.com

Tools Alone Produce Fools

2009-04-15T11:41:00.003-04:00

Managing a project or defining a complex system requires the knowledge and skills of appropriate methodologies and processes to realize the objectives. An individual who only knows how to use a project management tool (see selected list of tools in the sidebar), but lacks the understanding of the iterative and progressive nature of projects and how to manage the different processes within each phase will not be able to lead a successful project.

There is a big difference between developing a schedule that works and a schedule that looks good in a tool. Expert project managers need nothing more than a pencil and sheet of paper to lead a project. Tools help automate calculations and enable updates and corrections easily, allow tracking of changes and ensure a controlled environment that is agile and flexible. Tools do not defie methodologies, approaches, strategies, or plans. Tools do not execute, monitor or control and tools do not communicate, coach, inspire, motivate and collaborate. Only project managers do.

Are your pencils sharpened?

High Availability Systems Failure

2009-04-03T08:26:00.004-04:00

Does your business require availability capabilities? In today's complex business landscape and the demand for high accountability and transparency, high availability becomes a basic requirement in operations, information access and decision-making.

Interestingly most high availability environments that fail are unable to deliver the expected results no because of technology immaturity, but mostly due to poor management and oversight. A publicly known example is the State of Texas data loss as a result of invalid checks and balances and inappropriate technical management. In this particular case according to the article in the Dallas Morning News IBM has been fined $5.4 million. Of that, $2.7 million was for failing to resolve problems quickly and $1.2 million was for server outages. Data backup breaches, missed mail deadlines and taking more than 15 minutes to respond to serious incidents accounted for the rest, according to department records released this week.

Next time you implement a high availability solution, do not get fooled by the latest server technology, data backup system or disaster recovery tools. A high availability technology with a staff member who can not use it makes it useless.