WHAT EVERY EXECUTIVE NEEDS TO KNOW ABOUT ITExecutive MBA ClassMay 20, 2009

IT is a commodity IT should be customer driven Consolidate IT organizations Plan to spend 4-8% of gross revenues

on IT Design a “to-be” set of technical

standards Business units should own the business

process IT should have technical standards. See past IT staff pushing “technical

religion”

WHAT EVERY EXECUTIVE NEEDS TO KNOW ABOUT IT

Digital natives offensively share information We are living in exponential times

Product development is becoming simulation based Computers are starting to perform “knowledge

discovery” Your corporate and your competitor’s data is onli

ne. Information security must be rethought

WHAT EVERY EXECUTIVE NEEDS TO KNOW ABOUT IT

Good IT is about maintaining the fundamentals while “living in the

exponent”. If you do, IT does matter!

really

Digital natives offensively share information We are living in exponential times

Product development is becoming simulation based Computers are starting to perform “knowledge

discovery” Your corporate and your competitor’s data is onli

ne. Information security must be rethought

WHAT EVERY EXECUTIVE NEEDS TO KNOW ABOUT IT

Good IT is about maintaining the fundamentals while “living in the

exponent”. If you do, IT does matter!

really

Over 200 million users

(source: CNET News)

400,000 joining per day

If Facebook were a country,It would be the 5th-largest in the world

More than 100 million users log on to Facebook at least once each dayMore than two-thirds of Facebook users are outside of college

The fastest growing demographic is those 35 years old and olderAverage user has 120 friends on the site

More than 3.5 billion minutes are spent on Facebook each day

Facebook is 5 years old

1/3(source: The Guardian)

of time online spent on social

networks

NOT JUST GEEKS!

The revolution has gone global.

CultureYouth are growing up

1946-1960Boomers

Analog Technology1961-1975Generation X

Telephone & TV

1991-2005Generation E

New Technologies

1976-1990Generation Y

Digital Technologies

Analog Technologies

“This generation thinks differently, behaves differently and is already starting to demand, aggressively, big changes in the way society, business and

individuals interact. Is your workplace prepared for the changes?”

– CIO Insight Magazine

Gen Y - Social Model

Offensive Information Sharing

Boomers - Industrial Model

Defensive Information

Sharing

Social Networking Sites

… Is this what you imagine?“Facebook Fired” became a memeIntern posted this to facebook

Got fired.

60% of people use social software today for business purposes.

Social networks today are explicit – and a pain

In the future, networks will be automatically discovered.

Photo from Facebook

Phone numbers discovered in email signatures

Current status from Facebook / Twitter

Network of people we both know (derived by email)

Network of people she knows that I don’t know

Digital natives offensively share information We are living in exponential times

Product development is becoming simulation based Computers are starting to perform “knowledge

discovery” Your corporate and your competitor’s data is onli

ne. Information security must be rethought

WHAT EVERY EXECUTIVE NEEDS TO KNOW ABOUT IT

Good IT is about maintaining the fundamentals while “living in the

exponent”. If you do, IT does matter!

really

THE INTERSECTION OF CLEAN ENERGY AND ECONOMIC GROWTH IS THE DEFINING CHALLENGE OF OUR GENERATION

1850 1900 1950 2000 2050 2100CO

2 em

issi

ons

(GtC

y-1)

5

10

15

20

25

30Actual emissions: CDIAC450ppm stabilisation650ppm stabilisationA1FI A1B A1T A2 B1 B2

Climate forcingis both stronger

and soonerthan expected

MEANWHILE OUR NEED FOR ENERGY IS AFFECTING GLOBAL CLIMATE

WE NEED FASTER COMPUTERS TO ACCELERATE OUR UNDERSTANDING OF GLOBAL CLIMATE CHANGE…

Cray 1 (1976)136,000,000 Floating Point Operations Per Second

Cray XT5 (2009)1,000,000,000,000,000 Floating Point Operations Per Second

University of Tennessee’s “Kracken” supercomputer. World’s fastest academic computer.

Cray 1 (1976)136,000,000 FLOPS

Cray XT5 (2009)1,600,000,000,000,000 FLOPS

We are just at the beginning of the computing revolution…

The Stuff of Dreams Limitless clean energy Quantified impacts of

atmospheric CO2

U.S. cellulose based fuel rather than oil

Drug delivery systems that release medicine precisely where needed

Simulations of fusion reactor

Climate code for global,dynamic CO2 exploration

New insights into cellulose-to-ethanol

conversion

First 3-D simulation of flame including

chemistry, temperature, and flow

WHAT IS THE UT SUPERCOMPUTER USED FOR?

SIMULATION DRIVES BUSINESS COMPETITIVENESS

Reducing design costs through virtual prototyping

Reducing physical tests for faster time to market

Image courtesy of Pratt & Whitney

Breakthrough insights for manufacturers Procter & Gamble uses HPC

to model production of Pringles® and Pampers®

Paper (n): The full record that supports that claim should be available for detailed examination and critique

We were taught to share these discoveries by publishing a paper or filing a patent

after all the work was done.

Corporate email communicationsGreen = InternalYellow = External

Meanwhile we communicate electronically ...

to networks of people...

… not the objects

What if we,curate the

conversation...

Is the openness of the next generation going to change the scientific process by allowing computers to mine the “human conversation”?

Scientific Method

Proving a hypothesis.

Knowledge Discovery

Finding the unknown correlations.

The usual response to these ideas?

Scientists like…

…control

“To be termed scientific, a method of inquiry must be based on gathering observable, empirical and measurable evidence subject to specific principles of reasoning.”

- Wikipedia

They don’t like…

Digital natives offensively share information We are living in exponential times

Product development is becoming simulation based Computers are starting to perform “knowledge

discovery” Your corporate and your competitor’s data is onli

ne. Information security must be rethought

WHAT EVERY EXECUTIVE NEEDS TO KNOW ABOUT IT

Good IT is about maintaining the fundamentals while “living in the

exponent”. If you do, IT does matter!

really

If there is value in the data, who can see into the cloud?

WindowsLive

Mega Vendors are providing “free” services so they can jointly see your data.

MATH IS GETTING BETTER AT MACHINE LEARNING (EXTRACT KNOWLEDGE FROM DATA)

t

iii

t

t

wwDDsim

wwwD

wwwD

12121

2,22212

1,12111

),(

...,,

...,,

))_((_*))_((())_((_*))_(((

))_((*))_(((),(

22

11

bnan

ba

ba

ba

inDocWordCountinDocwordCountinDocWordCountinDocwordCount

inDocwordCountinDocwordCountDocDocsim

1980s: Pair wise document similarity (document clustering)

1990s: Latent Semantic Analysis (what does the word mean?)

documents1 2 3 4 5 6 7

1 2 3 4 5 6 7 8 9terms

really just matrix multiplication:term vector (query) x strength matrix = doc vector

WE ARE MAKING IT EASIER FOR THE MACHINE TO LEARN1980s: HTML

1990s: XML

• Uses tags for formatting (e.g., “italic”).

• Describes the layout.

• Uses tags for structure and semantics (e.g., “this is the address and contains the house number, street, and postcode”)

GOOGLE FLU

• Web search terms can be indicators of flu activity

• Google can estimate flu activity per state two weeks faster than traditional systems (US Center for Disease Control)

DISCOVER YOUR COMPETITORS SUPPLY CHAIN.  By analyzing Custom And Border Protection public Bill of Lading, analysts were able to determine Apple’s supply chain and release date for iPhone3G

SENTIMENT ANALYSIS FOR STOCK MARKET PREDICTION Brokerage houses are using computers to

“micro-trade” stocks based on sentiment analysis of blog sphere.

Figure from Glance, Hurst, Nigam, Siegler, Stockton, & Tomokiyo, KDD’05

MY CURRENT MARKET STRATEGY (YTD I AM UP 15%) I use zillow.com analysis of MLS to assess US

housing trends.

S&P housing index does the same thing, but releases the news ~6 weeks after Zillow does.

If there is a difference in the sentiment on the street (on the day before the housing index is released) and what I see on Zillow I will log/short NYSE:URE

Correlation index between S&P and Zillow is 95%

Wash DC

National Avg

THE MORE WE SHARE THE SMARTER IT GETS.

Googledocs determined the commonality of what I was entering and automatically

completed the rest of the list.

GoogleDocs searched the web.

Next generation versions will be able to tell you what correlations

exist between two seemingly unrelated attributes

WHAT IS NEXT…Every photo is moving to the cloudFacial recognition is emerging as a

mainstream capabilityWithin the next ten years you will be

able to search for a face in a context like:“Show me a picture of bob in a car”

Prepare for the skeleton in your closet to return.

We are going to need to redefine what we expect to be private.

Digital natives offensively share information We are living in exponential times

Product development is becoming simulation based Computers are starting to perform “knowledge

discovery” Your corporate and your competitor’s data is onli

ne. Information security must be rethought

WHAT EVERY EXECUTIVE NEEDS TO KNOW ABOUT IT

Good IT is about maintaining the fundamentals while “living in the

exponent”. If you do, IT does matter!

really

Current approach to securing enterprise information in the cloud

NEVER UNDERESTIMATE THE MOTIVATION, PATIENCE, AND CREATIVITY OF AN ADVERSARY!

They play strength to weakness

They develop surprising partners

They have no rules They see offense as a

systems challenge They attack against a defense

that is naïve, arrogant, unbalanced and fragmentedWe can work a lot harder at what we are doing and not make much of a

difference!

National Interest

Corporate/Personal Gain

Personal Fame

Curiosity

Script-Kiddy HobbyistHacker

ExpertSpecialist

Vandal

Thief

Spy

Trespasser

Author

WHAT MOTIVATES A HACKER?

“The seed of revolution is repression”

Woodrow T. Wilson

Technology innovation is driven by consumer products“I can do this at home, why not in the office?”

Digital Natives (younger workers) have new

expectations“You want me to do what? You must be joking, I’ll just use my Groove / Flikr /

MySpace / del.icio.us for collaboration. Next time IM me.”

The line between personal and business is increasingly blurred.“You want to contact me in the evening, that is fine. We are going to use my home computer, IP phone, gmail,

not yours”

Consumer products cost less.

“How much? I could have 50 skype accounts for the cost of one of those

old ISDN phones”

Business needs greater agility to survive.

“I can’t wait for IT to deliver that”

Human nature is to either avoid online services or impose more security

controls

Time to rethink history information security policies

IN ORDER TO LEAD THE REVOLUTION INSTEAD OF REPRESSING IT WE

MUST….

FOCUS ON SECURING THE DATA, NOT THE DEVICE

TYPICAL POLICY EXPRESSION…

…LACKS ENFORCEMENT TOOLS

ENTERPRISE DIGITAL RIGHTS MANAGEMENT (EDRM)AKA: DOCUMENT LEVEL SECURITY

Information Author

The Recipient

EDRM Server

2 3

4

5

2. Author defines a set of usage rights and rules for their file; Application creates a “publishing license” and encrypts the file.

3. Author distributes file.4. Recipient clicks file to open,

the application calls to the EDRM server which validates the user and issues a “use license.”

5. Application renders file and enforces rights.

1. Author receives a client licensor certificate the first time they rights-protect information.

1

EDRM: This is not the same as DRM (iTunes / RIAA)

WHAT EDRM DOES NOT PROTECT FROM:

Slide courtesy of Microsoft

Digital natives offensively share information We are living in exponential times

Product development is becoming simulation based Computers are starting to perform “knowledge

discovery” Your corporate and competitors data is online. Information security must be rethought

WHAT EVERY EXECUTIVE NEEDS TO KNOW ABOUT IT

You can’t teach “good IT”, it is about “living in the exponent”.

IT does matter!

really

SUMMARY IT does matter, but you need to change your expectations.   IT can be THE strategic differentiator for a modern business.

  The problem is IT is changing so quickly you can’t “teach it”

you have to jump in and “live it”.   The only thing you can “teach” is to be offensive with your

information, think way outside the box and be ready for a major cultural change to show “raw humanity” and what people are really thinking.  Yes, this is uncomfortable.  But if you are scared I did my job.  Don’t think it is something you can slow down.  Get on board and make some money by embracing the change. 

“It is not the strongest of the

species that survive, nor the most

intelligent, but the one most adaptable

to change.”

- Charles Darwin

Time for a change.