If it can go wrong, it WILL go wrong

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You can never predict how customers will use computer systems, but one thing is certain, everything that can happen, will happen, whether you like it or not.

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My company, systems@work, is the author of specialist software for expense management, and for the management of professional services organisations. Ours are highly configurable systems that can be used for a very wide variety of purposes. Even the terminology can be modified by the customer to suit the customer’s needs – one organisation’s ‘project’ is another’s ‘engagement’ or ‘case’, and yet another’s ‘investment fund’. Timesheets, attendance forms, expense forms, purchasing forms, absence request forms, planning, invoicing and reporting – these are some of the system’s possibilities, but each of our customers will set these up and use them in different ways. There is no right way to use our software, and however they set it up and use it, our customers must expect it to work.

Some years ago a few of our customers asked us to develop a new feature. Especially because end users might be scattered across the globe, they needed their administrators and first-line support staff to be able to log in ‘as if’ they are another end-user. And no, such end-users wouldn’t do any updates, they’d just be looking at the system as if through the eyes of the user they are trying to help, and yes, they wanted the end user to stay logged in whilst the administrator did his or her diagnosis, so both users could look at the same screen together.

So, we provided a highly restricted option called ‘Identity Switch’ that enables one end user, the administrator, we supposed, temporarily to log in as another.

Having two end users logged in to a system is uncomfortable. In our system, as in many, there are all sorts of temporary tables and sets of records that are identified by the end user’s name, and if two users are updating the same set at the same time you can create logical chaos. For that reason, we make it impossible for two users to login at the same time with the same user credentials. If they attempt it, the system says no.

Except, of course, for the administrator or support employee using the new Identity Switch function. We assume they will be careful, conscientious and that they understand the dangers of using Identity Switch to do updates in the system on behalf of the other user.

But you can never predict what users can do, and if there’s something you don’t want them to do you must prevent it, not merely advise them against it. Even if it’s more coding work up front, it will save you time later.

Over the last few months we’ve received a small flurry of reports of a few links between records getting lost.  It worried us, of course, and we spent many days investigating how it might have happened, finally discovering that it happened when Identity Switch was used. It turned out that Identity Switch was used for purposes way beyond those we had anticipated, not in exceptional circumstances, as we had recommended, but as part of the normal business process.

‘We warned you,’ we might say.

But what would be the point? We’ve still got to spend hours and hours diagnosing and repairing the problem.

There is no moral high ground to occupy if you’re a software developer. You can try to occupy it, but you’ll obtain no advantage. You simply cannot tell your users how your software ‘should’ be used, especially if you’re trumpeting its configurability. If it can go wrong, it will go wrong. If it can be ‘misused’ it will be.

In reality, there’s no such thing as ‘misuse’. If there’s something you don’t want your users to do, you must stop them doing it, not merely advise against it.

We’re working on it!

The Illusion of Remote Control

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Many years ago I undertook a short consulting assignment in Kazakhstan on behalf of a small oil company based in London. There’s almost nowhere I wouldn’t visit at least once (except, perhaps, Baghdad) and I looked forward with great excitement to the trip. The oil company’s administrative offices were based in Aktobe, a town northeast of the Caspian Sea on the imperial-era Trans-Aral railway line. The oil field itself, I understand, was a few hundred miles southwest across the steppes towards the Caspian.

It wasn’t easy to get there. I flew from Prague through Moscow, and returned through Astana, Almaty and Istanbul.

aktobe map

I was invited to visit Aktobe to find out how the company was using SunSystems. Infor’s SunSystems is a British financial accounting system that, better than almost any other system of its type in the world, enables both local statutory accounting and corporate financial reporting to international standards. When it comes to remote financial control of an organisation, and Aktobe is nearly as remote as you can get and still find a four-star hotel, there is no better solution.

The company had just bought an oil field in the north of Russia and was considering implementing SunSystems near Archangel. They’d heard about us through our Moscow office and the British financial director seemed to place some trust in our company (LLP Group), or at least in me, probably because I am British too. How better to start with SunSystems in Russia than to look at how the company was (successfully) using the system in Kazakhstan?

Aktobe was built in imperial times, but bears all the hallmarks of a mid-sized brutal Soviet city – a simple grid of crumbling concrete apartment blocks, and wide wind-swept boulevards decorated with crude socialist realist monuments. In fact the city is less Russian now than for a hundred years, many of the Russians having left after Kazakh independence. A vast new mosque reflects the revival of local religion and culture, but in all other respects the city might have been anywhere in the former Soviet Union.

aktobe mosque

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What persists, however, as in many former Soviet Republics (Moldova is another example) is Russian-style correspondence accounting (see Correspondence Accounting – The Russian Way of Debits and Credits) and most organisations in Kazakhstan use 1C, a Russian accounting software system that does Russian accounting excellently.

SunSystems has many advantages over 1C. It is more easily audited, it allows more analysis, and, crucially for international organisations, it enables statutory and corporate accounting in one system, with the relationship between the two definable and auditable. That’s why many international organisations use it in Russia and the former Soviet Union.

It was no surprise to me, though, to find, when I got to Aktobe, that my client’s accounting team were using 1C. Many companies keep two sets of books, one in 1C and one in a ‘Western’ system such as SunSystems. Sometimes they build a bridge between the two to ensure that the systems reconcile and to avoid wasting time in entering transactions twice. There’s often a debate about which system should be the ‘primary’ system, but I won’t bore you with that debate here.

The problem is that most local accountants find ‘Western’ systems uncomfortable and effortful. Whilst it’s perfectly possible to use only SunSystems in Russia (see SunSystems in Russia – Perfectly Possible for the Determined Amongst Us ), it’s less easy to derive statutory reports from SunSystems than from 1C, and all local accountants owe their primary loyalty to the state. This is entirely understandable. They are personally and criminally liable for their mistakes.

It’s not often, however, that hostility towards a ‘Western’ system is overt. The great surprise in Aktobe was that my client’s accounting team weren’t using SunSystems at all. They hated it, and told me so. They were sending their monthly financial reports to London, ostensibly derived from SunSystems, but in fact derived from 1C with a few adjustments here and there. I looked at the SunSystems ledgers and the latest journals were posted months and months earlier.

Remote control isn’t easy. As LLP Group has grown over the last twenty years I’ve seen how hard it is to maintain standards, whether they are ethical standards, HR standards, accounting standards or consulting standards. There’s no substitute for frequent visits, frequent training, frequent fraternising and frequent forensic investigations into what’s going on. Saying that something ‘must be so’ from a distance without ensuring it’s actually so, is a waste of time. It’s very hard to maintain remote control of a very faraway place, and it’s easy, in a faraway place, to deceive someone at headquarters whom you hardly know.

The client was excited by my findings and was ever more determined that they should abandon 1C in Aktobe, and that they should use SunSystems for their new oil field in northern Russia. They were properly alarmed by the fact that their financial statements, the basis for their stock-market valuation in London, were produced without much accountability, in Excel.

But then, just a few weeks later, another company bought them, and all projects were off. I doubt that the team in Aktobe ever posted another SunSystems journal.

 

Many a slip ‘twixt the cup and the lip

cupandlip

Or, don’t count your chickens before they’re hatched.

Anyone who’s been involved in business acquisition talks knows that there are many things that can get in the way of completion. A few weeks ago (Strength in Numbers – Growth by Acquisition) I wrote that our LLP CRM (Customer Relationship Management) division was in acquisition talks with Logic point, hitherto our main competitor in the Czech Republic. And, lest you immediately draw the wrong conclusions, we haven’t stopped talking.

Acquisition involves courtship, engagement, marriage, sometimes even divorce. It takes time, and engagement is no guarantee of marriage. As with human relationships, attraction can sometimes be misplaced, and even if marriage is solemnized, the honeymoon doesn’t always last. And sometimes, even if the match is entirely suitable, circumstances and accident conspire to undermine it.

In our case you might describe the ‘marriage’ as a ‘forced’ one, forced by external events- our competitor’s financial distress. That said, it seemed plausible and sensible that we should help Logic point, and, together, become a larger, stronger company, very likely the dominant player in the Microsoft Dynamics CRM market in the Czech Republic.

Following our first talks we very quickly established the scale of Logic point;s difficulties and the probable extent of the cash investment we would need to make. But most importantly we established that our companies would be able to coalesce without friction, each bringing strong complementary skills to the mix. Acquisition, though, was predicated on our being able jointly to pay off the company’s liabilities over several years. This would mean negotiating reasonable terms for the termination of Logic point’s office lease, and the settlement of other outstanding debts. All of this seemed eminently negotiable. The alternative, it seemed, was bankruptcy, and to avoid such circumstances, we predicted, creditors would be willing to negotiate.

This was optimistic. Creditors, including the tax authorities, called our bluff and refused to negotiate.. Without an immediate injection of substantially more cash than we had planned to invest, the company had no choice but to declare bankruptcy, and enter a period of administration, a state from which it is not easy to emerge.

I can’t see who gains from this. The state may obtain full payment of unpaid taxes to date, but they won’t get any future income, and other creditors will get only a portion of what they’re owed. Moreover, it may take time to appoint an administrator, and in the meantime employees and clients may lose confidence and leave.

We’re still in talks, hoping to collaborate with an administrator, if one is appointed soon enough, hoping even to purchase what remains of the company if that is legally possible, perhaps picking up the pieces if not.

 

Giving Up

I was sent to boarding school at the age of seven, not, I continue to think, because I was a nuisance to my parents, but because they thought it a means to social advancement. Whether or not they were right, I took to it, and I can’t remember that I was ever homesick. I often claim that it was independence learnt the hard way, at an early age, that equipped me to conquer Eastern Europe.

It was a religious school, but of the Anglican rather than the Roman Catholic persuasion, so, though it was uncomfortable, it was not perhaps as religiously alarming as it might have been. Misdemeanours were discouraged by standing us in corners, where there was nothing to do but study the way paint cracks, rather than by the promise of eternal hellfire.

The school was attached to a cathedral and provided the boy choristers for the cathedral choir. I wasn’t one of them, but regardless of vocal talent, the entire school observed a religious life, all attending a daily service in the school’s chapel, and two services on Sunday – Matins and Evensong –  in the cathedral. These services seemed interminable, but the music was an inspiration. The cathedral was literally the centre of our lives. Whether we had sinned or not, and in all weathers, we had to run all the way round it before breakfast.

cathedral

Come Lent, and after the age of about 10, we were encouraged to give something up for 40 days so that we might come to understand Christ’s fasting in the wilderness, something he apparently did with us in mind, though I don’t get that, even now. In retrospect I’d rather Christ had empathised with me. I suspect that 40 days of fasting in the wilderness was a lot more fun than a British boys’ preparatory school in the 1960s, but I suppose Christ had fewer opportunities when it came to hardship. Why we had to learn to do without, by giving up sweets, or fish fingers, or baked beans, for nearly six weeks, I really can’t understand. What can the Reverends have been thinking, inflicting spiritual exercises on children barely ten years old? It seems as pointless to me now as that irritating question our teachers used to ask when we left some particularly revolting food uneaten on the plate.

‘What about those poor children starving in Africa?’

Well, what about them? I’d happily have offered them my portion of banana slop or green-tinged liver, but I couldn’t see how it could be got to them, or how eating everything on the plate instead could be of any help to them. I think, in any case, they would have turned up their noses at our school food, however hungry they might have been.

As for giving something up for Lent, I gave up sweets one year, and Doctor Who, another. As far as I can remember, there were few other pleasures to renounce. School food certainly wasn’t a candidate and we were made to eat it anyway. Doctor Who was then, and still is, my favourite sci-fi series, and giving it up was much more difficult than sweets. After a week or two I couldn’t resist peeking through a crack in the door. I could hear the Doctor and the Daleks, but I really wasn’t watching. ‘Watching’, I argued, thinking not as an Anglican but as a Jesuit on this occasion, meant sitting on the sofa in front of the telly with all the other boys. This was ‘peeking’.

I wonder now whether there is any point at all in making young children give things up. Weren’t we much too young for spiritual self-discipline? Weren’t they doing us enough harm already by sending us to school and making us do without our parents and the comforts of home?

I’ve been thinking about this since a former colleague, Martin Skalicka,  popped in to our Prague office last week. He was our very best salesman in the early 2000s, a thoughtful, humorous, imaginative colleague of an admirably ‘alternative’ disposition. Value, for him, never meant only price. He’s also the tallest man I know. He was wearing a t-shirt with ‘Sri Lanka’ printed on it and I asked him if he’d just been there. It turns out that a year or two ago he’d visited a Czech friend who’d given everything up to become a Buddhist monk. It was a case of self-abnegation beyond even the wildest aspirations of the Reverends at my school, a rejection of personal relationships, property, sex, humour, love, and power, an abandoning  even of want and need, and an acceptance of complete dependence on the kindness of others. A life of saffron robes, mediation and a begging bowl.

It also meant leaving behind his financial obligations, his wives, lovers and children.

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We’re sometimes inclined to venerate such people. They make our worldly strivings seem shallow and illusionary. We envy them their impervious aloofness, at least if they reach the remote nirvana they seek. They can no longer be disappointed because they’ve simply stopped wanting things. The world, to them, is illusion.

But to me it’s not, and I’m not tempted in the least to board the flight to Colombo. It seems too harsh a path, too radical a solution to the twin demands of the body and the spirit, as is excessive indulgence, at the other end of the spectrum. Why demonstrate independence and freedom through complete abstinence? Isn’t moderation at least equally difficult and very much more sensible?

I give up alcohol from time to time. It’s not entirely easy, but I like to be in control rather than at the mercy of my cravings. But I’ve found it’s actually easier to be black and white about it, all or nothing, than very carefully moderate.

Augustine prayed, ‘Lord, make me chaste, but not yet.’ Of course it’s foolish to be led entirely by one’s desires, but why even wish to be entirely chaste?

As for spiritual self-improvement, isn’t it, at least when it becomes a complete retreat from the world, just a tiny bity self-regarding? Does our own spiritual well-being outweigh our worldly responsibilities?

Business Ethics in ‘Eastern Europe’ – Concluding Thoughts

I have lived and worked in ‘Eastern Europe’ since the summer of 1987, when the region still lay behind the ‘Iron Curtain’. The last years of Soviet-inspired communism were apathetic rather than fervently ideological, and cynicism about public institutions – Government, the law, the media and politics – was the norm.

On the other hand, greed and materialism had little to work with. Following the collapse of Soviet Communism private enterprise emerged and finally flourished, unconstrained, on the whole, by law and morality. The crumbling assets of the former regime were up for grabs, and grabbed they were.

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I’ve written four posts on the ethical framework of those years, and have itemised many of the ways in which the cynical businessman might exploit his partners, competitors, suppliers, employees and the state.

Ethics and Business – ‘Eastern Europe’ after the Revolutions

Business Ethics in ‘Eastern Europe’ -Everyday Misdemeanours

Business Ethics in ‘Eastern Europe’ – Further Opportunities for Mischief

Business Ethics in ‘Eastern Europe’ – Tax Evasion and Other Ills

It was within this framework that I built my own company LLP Group in Prague from 1992. Staying ‘clean’ was not impossible, but it was difficult, assailed as one was by requests for bribes, and recommendations by clever accountants of clever tax avoidance and evasion schemes. It was the Wild East, where anything went, and where the Government was always and ineptly in catch-up mode.

As LLP grew and spread across the region – to Hungary, Romania, Bulgaria, Poland, Russia, and Slovakia – I tried to spread the ethical word through frequent visits and by explicitly documenting the company’s policies. In the management manual I wrote as guidance for local managers I made it clear, for example, that if a gift (a bottle of wine at Christmas, a box of chocolates, flowers, a lunch or dinner) could not be declared by the recipient to his or her manager (and so on up the tree) then it counted as a bribe.

Times have changed, and business ethics have reached a much higher standard. By chance we found ourselves, in 2010, involved in clearing up the ethical mess of the UK’s Parliamentary expenses, as the supplier of the expense management system into which all MPs’ must now enter their Parliamentary expenses. I was proud that an Eastern European company was chosen, especially in the light of everything I’ve said. It no longer seems obviously absurd.

I’ve painted a dismal picture of business ethics in Eastern Europe. Most of what I’ve described was common practice before admission to the EU. It’s less common now, but still not infrequent. Business with the public sector is still as corrupt as ever but in the private sector less so. Business with international companies and organisations is overwhelmingly clean.

Joining the European Union (there were two waves of admission – in 2004 and 2007) has helped, and I think the Czech Republic, Slovakia, Hungary and Poland, are cleaner than they were. I would guess that if you were to award the UK nine out of ten for business probity, you could probably give these four countries six out of ten. Four out of ten, perhaps for the Balkans (Romania and Bulgaria), two out of ten to Russia, one out of ten to Ukraine.

If you’re an investor considering investment in a business in Eastern Europe (or anywhere else, for that matter), how can you judge that a business is ethically sound?

There are audit firms that specialise in ‘ethical audits’ but I am sceptical as to how thoroughly and imaginatively they can do their research.

  • You must look at how a business treats its suppliers, its employees, its customers, and the wider community it operates in.
  • Are its products harmful? If so, does it take steps to mitigate that harm, and inform its market of the dangers of its products (I’m thinking of drink, drugs, sugar, fats, and sex).
  • Is it careful with its consumption of energy?
  • Does it treat the environment well, and clean up the damage it might do?
  • Is it, literally, a blot on the landscape?
  • Does it encourage its employees to study?
  • Does it retain its employees and foster their career development?
  • Is it reasonable with regard to medical absences, maternity, or paternity leave?
  • Are its offices and workshops safe and pleasant?
  • Does it encourage employee feedback?
  • Is staff turnover an indication of care or disregard?
  • Does it pay its suppliers on time?
  • Does it strenuously avoid, or evade tax?
  • Does it contribute to good causes and do so with the active involvement of managers and staff?
  • Does it abuse the EU’s largesse?

These are difficult questions to answer when you’re looking at a business form the outside, and from a distance, but to be really sure that you’re investing ethically, in the wider sense, I would suggest you need answers to them all.

I don’t believe in the Cloud

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There, I’ve said it. I know it’s a heretical view, but I’m no follower of fashion, whether sartorial, gastronomic, linguistic or professional.

the cloud

But it’s not a simple issue, and I will qualify my views very carefully.

I’m talking of course, of the IT Cloud, that somewhere-nowhere place where software and data are held for private or corporate use. I don’t doubt that it’s a safe, secure and cost-effective place, (and if it’s not yet those things, it could be). And I don’t doubt that when it comes to certain kinds of ‘utility’ applications – word processors, spreadsheets, simple databases, and so on – it makes it easier for people to share data and ideas. There are plenty of benefits when it comes to certain, limited, kinds of Cloud. My objections are confined to the Cloud as it’s promoted for business applications, a field I’ve worked in for more than 35 years.

Business applications are at the core of all medium-sized and large organisations all over the world. Without them things don’t get made, sales don’t happen, deliveries fail, customers become unhappy, profits don’t get calculated, and vital things don’t get bought or just don’t arrive in time. I’m not sure if they save on paper, but they save on labour, doing those repetitive, communicative and administrative things more accurately, consistently and rapidly than humans can ever do them. They reach out across the internet to enable us to order pizza from our living rooms, or buy tickets for flights from one continent to another. They touch are lives hundreds of times a day.

They are immensely complex. The largest of them, such as SAP or Oracle, contain millions of lines of computer code, and trillions of possibilities, and they’re developed by thousands of programmers over millions of man-days. The largest (and most expensive) of them also do absolutely everything that a company needs its business systems to do- from procurement and purchasing, engineering simulation, to distribution route-planning, payroll and career-planning.

The best of them are configurable and don’t need source-code modification to make them work well for a particular customer. Take Infor’s SunSystems, for example, a beautifully designed accounting system that is easily adapted for all sorts of purposes, or systems@work’s time@work, a professional services and expense management package that works for a wide variety of professional services organisations, from consulting and engineering, to law or oil and gas exploration. Neither system comes with source code, so ‘one size fits all’ and each organisation’s quirks are managed through configuration of the software’s parameters. My company – LLP Group – has worked enthusiastically with both of these products for more than twenty years. We love them, but except when life is very simple, I don’t seem them perching entirely comfortably on the Cloud.

The reality is that there is no core business system in the world that does all the mission-critical things that a company needs only through configuration (those vital things that enable it to be competitive). And there’s no core business software system in the world that does everything. There’s usually a need for the integration of several business systems –  time@work with SunSystems and Microsoft CRM, for example – to cover 95% of a company’s needs. Some of these systems, particularly those that bring a particular competitive advantage, may even have been written specifically for one company.

Integration is difficult to do in the Cloud. I take the Cloud, in this context, to be a place where a single instance of a business software system is installed and used by multiple organisations of different kinds – one software version, but configured differently for each organisation. That’s ‘cloud cuckoo’ Cloud in my experience, certainly if we’re considering those essential systems at the heart of a competitive business.

The Cloud is best when it offers either a peripheral function that isn’t mission-critical and is more or less standard across a wide variety of sectors (expense management, for example) , or a function that is essential but can be configured sufficiently to suit most organisations (CRM systems such as Salesforce, for example). But it’s no good for those idiosyncratic areas that make one company stand out from another or when an ambitious fashion-following IT or Operations Director says, ‘I want everything in the Cloud.’

I’ve seen Cloud implementations fail at the first hurdle, especially when it comes to the almost always necessary integration of multiple systems. Integration code is rarely usable by more than one organisation, and as soon as you need something special up there in the Cloud alongside the ‘one size fits all’ copies of your core business software, you’ve descended from the purest Cloud to something that’s merely ‘hosting’, because no one else can use the particular combination of software and integration code that’s been installed and developed for you.

And, even if you’re in the purest Cloud, you’re still vulnerable to what can seem like the arbitrary upgrade of the core software, which is entirely out of your control. Sadly, business software contains bugs, and most companies want to test very carefully before accepting a new version. In the purest Cloud you don’t have that option.

So, no, I don’t believe in the  Cloud. I love the idea that you don’t need your own IT department, that to others can be delegated the responsibility of procuring IT infrastructure, and of ensuring safety, security and performance. That’s hosting or the ‘private Cloud’. But when it comes to the mission-critical functions and very specific integrations on which your organisation depends – forget the Cloud in its most idealistic form.

 

Grotto – Another painting by Daniel Pitin

I bought another painting (my 11th) by the Czech painter, Daniel Pitin, following his recent one-man show at the Hunt Kastner Gallery in Prague.  I haven’t enough wall space at home, so yesterday it was installed at the office (LLP Group).

‘Grotto’ (2015)

grotto

It’s a good companion piece to Crystal Landscape, which I bought in September.

‘Crystal Landscape’

cyrstal landscape

You can see more of Daniel’s paintings here.

Daniel Pitin is one of my favourite painters and I’ve been buying his paintings for nearly 16 years. It’s a tempting and short journey of just three metro stops to his studio from my office in Prague. It’s a much longer journey to the Paintbrush Factory in Cluj Napoca in Romania where some of my other favourite painters work or have worked.

Serban Savu

Marius Bercea

Mircea Suciu

Adrian Ghenie

I’ve bought paintings by the first three of these, but Adrian Ghenie’s now sell for stratospheric prices, so it’s too late for me. He’s probably the most successful and well-known young artist from the whole of Central and Eastern Europe. His version of Van Gogh’s Sunflowers sold recently at Sotheby’s in London for more than three million pounds.

‘Sunflowers – 1937’

sunflowers

In case you’re stuck for an idea, a painting by Adrian Ghenie would make a very welcome 60th birthday present next year. Start saving.