Saturday, 27 February 2016

Debt, the economy and housing

I know I have been quiet on housing for a while but there is a reason for that.  I figured that with the downturn Aberdeen would get more affordable housing the old fashioned way ( a crash).  Not pretty, but probably true, given the size of the downturn and lay-offs.

Then someone publishes a fantastic article that neatly combines many of my previous blog posts , so I felt the need to share the article.   It even talks technical :-)....

Original Article

In summary it says:

Affordable housing is not affordable and gets people into too much debt.  This causes many other issues, not least the fact that given the fragile nature of peoples jobs nowadays, many people will be in danger of losing a house they are trying to buy if they lose their job.

"Rather than trying to resolve the problem by regulating or deregulating the existing market, what if we could create a whole new, separate, parallel market for housing, which runs on a fundamentally different economic operating system, and yet can exist alongside the existing one; acting almost like a slow-release valve."

"First, it would change who builds our homes. It would be founded on the most obvious piece of common sense that has yet to be applied in policy: that the only people who will always build the best, most sustainable, most healthy, most affordable homes they can are the people who are going to live in them and pay the heating bills: us."

"The strange thing is that once you have the opportunity to act as your own developer (whether it’s as an individual or as a group), the same house on the same plot of land instantly can become as much as 1/3 cheaper; simply because you are no longer paying a developer"

"If there’s one lesson we can take from digital & web platforms over the last two decades, it is that it is now possible for networks of small, distributed producers to outperform large, centralised, one-size-fits all industrial models. Think YouTube, Wikipedia, AirBnB."

We could rent the land too, "but what if we were to go further, and create a parallel market for land too, based on the same very simple rule: that the land can only be bought, owned and developed by the people who are going to live there? "

"So in the same way that the value of a piece of agricultural land is less than a piece of land with planning permission for homes (say, £20,000 per hectare compared to £6m per hectare), in many areas the value of the same piece of land in this parallel land market would be less than it would be in the mainstream market; perhaps something like £3m per hectare."

"That could bring the total cost of our £250,000 home down to something more like £105,000."

See original article for how this could work.....

Tuesday, 16 February 2016

How Platform Coops Can Beat Death Stars Like Uber to Create a Real Sharing Economy

Original article

We have an epic choice before us between platform coops and Death Star platforms, and the time to decide is now. It might be the most important economic decision we ever make, but most of us don't even know we have a choice.

And just what is a Death Star platform? Bill Johnson of StructureC3 referred to Uber and Airbnb as Death Star platforms in a recent chat. The label struck me as surprisingly apt: it reflects the raw ambition and focused power of these platforms, particularly Uber.

Uber’s big bet is global monopoly or bust. They’ve raised over $8 billion in venture capital, are on track to do over $10 billion in revenue this year, and have an estimated 200,000 drivers who are destroying the taxi industry in over 300 cities worldwide. They’ve done all this in just over five years. In fact, they reached a $51 billion valuation faster than Facebook, and plan to raise even more money. If they’re successful, they’ll become the most valuable startup in history. Airbnb is nearly as big and ambitious.

Platform coops are the alternative to Death Stars. They do as Lisa Gansky urged -- they share value with the people who make them valuable. Platform coops combine a cooperative business structure with an online platform to deliver a real-world service. What if Uber was owned and governed by its drivers? What if Airbnb was owned and governed by its hosts? That’s what an emerging movement is exploring for the entire sharing economy in an upcoming conference, Platform Cooperativism.

Shareable helped break the platform coop story last year in a Nathan Schneider feature entitled, “Owning is the New Sharing” along with Trebor Scholz of the New School. These two thought leaders, also the conference organizers, identified a wave of platform coops forming, but we’re still in the early days.

See  Original article for more......

Friday, 12 February 2016

What needs done to implement "Digital" across local authorities and their stakeholders ?

I figured out the other day that I have spent my working life improving processes.  When at Ciba it was organic chemical processes where I learned to record and analyse every aspect of a chemical process as the inputs were changed until we got the ideal process.

I then moved on to analytical chemistry and developed skills in replacing old, time consuming analytical methods with fast, reliable automated methods.  As I moved up the management ladder in GSK my focus moved to the business processes we used and how we could refine and automate them.

Working across sites, across disciplines and companies caused me to focus on the business processes around the transfer of technology from the research company into a production environment and I came to understand how cultures and people were the real barriers to truly efficient business processes.

So here we are today, twenty years on, and I reflect on how a local authority with a silo based organisation and it's charitable stakeholders each with competing business propositions for funding might actually be aligned and collaborate on a common purpose of "making the service users happy with access to great services" that were as easy to use as buying something on Amazon or getting a Taxi with Uber.  Couple that with a political element in the local authority and, as a councillor said to me the other day, "there is no chance" of working across authorities and stakeholders.  The councillor really believed that.

Here is the thing though; without scale, digital improvement to working practices will be local and minor.  The really successful disruptive companies like Amazon, Uber and Airbnb all have one thing in common.  They understood the existing business process, before radically redesigning it, supported by digital technology.  They knew that their platform was scaleable world wide.

Yesterday my wife and I were organising a trip to France to visit the village were we used to live.  It is a 1500 mile drive.  So we thought to stop along the way.  We decided to go to La Rochelle.  My wife had tried using Google search to find an apartment, that took pets, but had failed to find any suitable ones.  I used Airbnb and within 5 minutes we had booked an apartment near the beach in La Rochelle that allowed pets and all for a reasonable cost.  It was so easy, the Tech. guys had really understood what was needed.

Hence why I posted a while ago "Should Amazon run our local services (The Council)?".  The problem with a private proprietary company like Amazon running anything is that although the client gets a great platform and the vendor has access to a great platform, Amazon makes all the money and certainly Scotland does not win at all.  Amazon produces loads of low value, low pay jobs and that gets Scotland nowhere.  At the same time the rest of the private sector loses reams of jobs as Amazon picks up their customers.  Oh and the multinational pays virtually no taxes compared to local businesses.

Is that what we want to happen to public services?  I don't.

How can we support local authorities to redesign what needs done, to get truly useable public services that delight service users,  and at the same time create high value jobs in the local economy for SME's ?

I have a solution.  We need to use Open Source ways of working.  We need a community of Tech. volunteers to help the local authority redesign how we run local services so that the Digital Place Strategy of Aberdeen City Council has a business improvement process running along side it.

Everyone wants more openness in public services.  Everyone wants easy to use digital services like those provided by Amazon, Uber and Airbnb.  What we don't want are Tech. companies making all the profits and the local region getting no benefit. We can grow a Technolgy industry in the region to provide the applications but only when we understand the business processes across local authorities and their partners.  We can leverage the data that will be collected by being a Digital Place but only if we can get to that data.  In short it is no good having digital roads if we don't have the digital vehicles to make use of those roads.

So in plain English we need an open local authority with open working partners, all using open business processes.  We will then will inspire local Tech. companies to look at those open business processes and deliver software that will allow service users to access services easily.  Once everything is in the open it can be scaled to fit right across the country bringing sustainable benefit and jobs to the regions in Scotland.  The alternative is a closed, proprietary world where service users get patchy improvements to services and the profits and high value jobs go to the multinational companies in other countries.

Aberdeen could do with some high value jobs at the moment...

Saturday, 6 February 2016

What is a business process ?

Here is a business process from a service users perspective:

  • The first thing to note is that a service must provide information in order that it can be used.  In this way users and other services are aware of the support available (Information).
  • A service user may then be referred to a service by another party (GP) as they are the first point of contact (Identification).
  • The service user may then visit another service that can analyse their issue  and help identify possible solutions  and support them through the process (Advice).
  • A separate organisation will be able to solve the issue for the service user (Solution).
  • The service user may need ongoing support from a separate organisation (Ongoing support).
The moral of the tale here is that single organisations do not solve whole problems.  Your will notice that the local authority is only part of the business process that the service user accessed (the part shaded in red).

Digital solutions allow the collation of large amounts of information which is available 24/7.  To build such a digital solution requires that the business process is understood and redesigned to make it easily available as an online service.

Service users are spoiled by companies such as Amazon and Apple.  They expect organisations to deliver services quickly and easily using a smart phone, computer or tablet to interact with the service.

How many councils can rival Amazon?  That has to change.

Councils must reinvent the entire business process.....not just in their department, or their council but right across the business process (and preferably right across Scotland).

Original article