posted 1 Mar 2011 in Volume 14 Issue 5
Flirting with disaster
Robin Smith on the lessons organisations must learn from intelligence failures
Would you consider Apple CEO Steve Jobs a failure? Maybe the biggest in the world? Probably not. But he is almost certainly someone who has failed. And because he has been prepared to fail and, more importantly, to learn lessons and understand intelligence provided from these failures, he is now one of the leading thought leaders in the world of business and leisure technology.
A culture of failure?
Jobs’ history is littered with interesting stories of success and failure. If you are the proud owner (or, like me, just a jealous admirer) of an iPhone you might not want to remember Apple’s first attempt to bring together a phone that would unify an array of gadgets that are now seen as a standard – from mp3 player, camera and other cool-ish apps. The Apple Rokr, in association with Motorola, was released to almost total ambivalence in September 2005 and was a huge commercial flop. Even as the Rokr was dying on the shelf, Jobs began looking at the mobile industry and his own organisation to learn why Apple had failed. The answer was due to a failure to manage business intelligence across his organisation, which led to this sales disaster. The result of this review was the creation of the revolutionary iPhone, which has now shifted 46 million units across the world in little more than 30 months.
The key to Apple’s transformation of a sales disaster into a success was related directly to the fact that Apple and Jobs are passionate about learning from their mistakes and uncovering sources of business intelligence that can improve all aspects of performance. Mistakes are viewed as an essential part of any design or creative project within Apple. Mishaps are regularly identified and locked into the corporate project records, just waiting to be discovered by design teams working on the new killer Apple product. However intelligence has to be captured, assessed and managed to ensure that learning takes place across all activities.
How can information and knowledge professionals tap into this approach to transform failing initiatives into key corporate success stories? What should a hard working records professional do in the face of their own Rokr-style debacle?
The need for intelligence
“If you wish to converse with me,” said Voltaire, “define your terms.”1 The art of producing conclusive definitions within knowledge management has always been a challenging proposition. However an initial outline can highlight why organisations crave intelligence during this recessionary times.
Intelligence is defined as information that has been subject to a defined evaluation and risk assessment process in order to assist with organisational decision making. Information can refer to all forms of information obtained, recorded or processed by an organisation, including personal data and associated raw information.
In simple terms, business intelligence is information that is gathered for the purpose of decisions. It is largely synonymous with corporate research, the systematic gathering, recording, analysis and interpretation of information about a company’s markets, competitors and customers. The objective of intelligence acquisition can vary. Gartner notes that, “The key to thriving in a competitive marketplace is staying ahead of the competition. Making sound business decisions based on accurate and current information takes more than intuition. Data analysis, reporting, and query tools can help business users wade through a sea of data to synthesize valuable information from it - today these tools collectively fall into a category called ‘Business Intelligence’.”2
All organisations must acquire intelligence that possesses certain qualities. The principles for high quality intelligence are:
Evidence-based – it is vital to base business intelligence on clear research evidence;
Consistency – accuracy and integrity are prerequisites for business intelligence to deliver a consistent service;
Skills focused – only via competency and experience will staff involved in planning be able to spot and handle business intelligence expertly; and
High quality – the characteristics of business intelligence assets must include conformance to highest standards.
Risk intelligence and its management
These days accessing intelligence is just a starting point for improvement. The deployment of intelligence within an evidence-based decision making framework is vital. There are innumerable examples of where organisations have access to key intelligence but do not take effective action to avoid disaster.
Risk matters within the information economy. And information itself is becoming ever more threatened by various sources, from government data breaches to identity theft. The diverse and expanding digital universe continues to pose problems for all organisations seeking to gather and assess quality business intelligence. Making evidence-based decisions using the current information sources continues to be impossible for a range of organisations.
So how can organisations use information to build intelligence captured by current information and knowledge systems and processes?
There are a number of strategies that can be pursued. Information and knowledge professionals need accurate data to develop strategic plans for improvement and modernisation. All corporate planning activities are predicated on having quality products arising from scanning of the environment in which the organisation operates.
Threat and opportunity identification is the major objective of information and intelligence scanning. This step enables an organisation to begin to understand the motivations and threats it faces. It can also identify vulnerabilities? for example, from emerging technologies. The objective is to produce a strategic analysis of the external and internal environments prior to a formal analysis and assessment using technique two of this integrated framework.
Following the first improvement technique it is necessary to conduct a deeper analysis and assessment to determine key actions and learnings for the information professionals charged with dealing with information risk. This is the core technique of the integrated framework for IRM.
This improvement technique adds value to the products produced by the scanning technique, turning the initial high-level analyses and profiles into actions within an organisation.
This improvement technique is standardised in order to achieve consistency in assessments and to allow comparison between organisations.
Learning from disasters
One imperative is for information and knowledge professionals to reflect on the disasters that have made the headlines over the past few years, in relation to business intelligence failures. You might remember the following three which illustrate the impact of intelligence failures.
Intelligence failure one: The Global Banking Crisis
The 2008 global crisis is now viewed as the worst economic crisis since the Depression of the 1930s. But how much intelligence was available ahead of the crisis that could have enabled decision makers to limit the damage to the global economy? Gray (2008) has noted: “The roots of (the crisis in 2008) go deep – into the dot-com crash of 2000 – when, around the world, the response was to keep interest rates as low as possible to encourage a return to economic confidence. Money became cheap and plentiful, and as a consequence, investors increasingly found themselves competing for assets, the pricing of risk became increasingly difficult as structures became more complex, and frequently investors underestimated the real risk. With low interest rates, benign inflation and rising asset prices, all was going well. As interest rates have risen over the past few years, the chickens have been coming home to roost. A combination of questionable lending practices of some US mortgage lenders, falling US property values and the consequential defaults by over borrowed mortgagees has caused credit losses on sub-prime mortgage portfolios.”3 Recent research has highlighted that the issues arising from the sub-prime market in the US were well identified by UK retail banking staff. Unfortunately the assessment and communication process was hijacked by corporate management who were intent on pursuing a high stakes strategy across the retail banking sector.4 This research highlights that just because intelligence is available that does not mean that organisational decision making is going to be any smarter. It also shows the impact of intelligence management for all dimensions of our economy and society.
Intelligence failure two: Policing in Northern Ireland
When intelligence gaps in UK policing were revealed by The Guardian, the impact of poor risk assessment were clear. Two undercover police officers narrowly escaped being killed by republican dissidents in a recent botched surveillance operation in Northern Ireland. Now there are claims by politicians and veterans of counter-terrorist policing this weekend that there was a worrying ‘intelligence gap’ within the Police Service of Northern Ireland regarding dissident terror groups.5
One of the tenets of improving police performance during the last ten years has been that intelligence-led organisations are reliant on information being transformed into intelligence. The introduction of the National Intelligence model (NIM) to support activities across UK forces has been a major success for the National Policing Improvement Agency. This model has been deployed across 43 police forces and associated law enforcement agencies to maximise the value of intelligence to forces to improve policing in all sectors.
The UK Police Service states that, “Capabilities must be built which enable information to be gathered, recorded, evaluated, disseminated, retained and disclosed as necessary from a range of available information sources. Staff members often submit information with no certainty of its potential relevance. NIM allows the police to direct resources to collect information to fill identified knowledge gaps. It also requires the Police Service to consider how and why it collects information and to identify ways to convert this information into intelligence”.6
NIM is an information-based deployment system and a cornerstone for the management of law enforcement operations in England and Wales. Historically most policing has been driven by the need to respond to calls from the public. This is necessary police business but crime and incident patterns are not identified. NIM identifies patterns of crime and enables a more fundamental approach to problem solving in which resources can be tasked efficiently against an accurate understanding of crime and incident problems. NIM promotes a cooperative approach to policing and many of the solutions to problems will require the participation of other agencies and bodies. It is further strengthened when used in conjunction with other partner agencies.
Intelligence failure three: NASA’s records management disaster
This could be described as a records disaster similar to the burning of Etruscan art in the early part of the fifth century BC. Nasa recently declared that it may have destroyed its only high-resolution images of the first moon walk. An estimated 600 million people watched the astronauts Armstrong and Aldrin planting the US flag in 1969. It means that the classic images of Armstrong’s “giant leap for mankind” are all that remain from the mission. The tape recordings were produced for a backup as an afterthought according to NASA staff. Nearly 40 years later archivists in Australia alerted Nasa that they believed they had found copies of the lost tapes from the Apollo 11 mission amongst a range of records exchanged between the countries’ government agencies. The tapes were immediately shipped to the US, where Nasa maintains what officials say is the only machine in the world capable of reading the old tape technology. The Guardian notes that: “Nasa believed the original tapes might contain digital data sent from the moon that could be converted into much sharper pictures of the landing than those broadcast on the day, which were taken by a television camera pointed at a giant wall monitor at mission control in Houston ? effectively a copy of a copy. But a standard Nasa money-saving measure in those days was to reuse the 14-inch tape reels after several years in storage. Agency officials ultimately concluded that the original Apollo 11 tapes were buried among an estimated 350,000 that were recycled in the 1970s and 1980s and the data was lost for ever”.7
This constitutes an unmitigated failure of intelligence that has deprived this and future generations of a key cultural artifact. Why? Because of a failure in communication that arose from poor intelligence assessment.
NASA did not just flirt with disaster it almost defined the entire concept. Information officials at NASA state that systems and processes were in place to protect this vital information but the failure to prioritise mean that a priceless document of a historical event might have been lost.
Corporate intelligence strategy
Any intelligence failure can be instructive for an organisation seeking to improve in this area. The makings of a corporate intelligence strategy begin with reflections on successes and failures. Formulating a strategy must begin with a clear approach to the following questions:
What are our key intelligence requirements? Understanding your sources and requirements can help formulate or update current approaches to business intelligence. If there is a need to segment a competitive market, it’s vital that market intelligence is available to help formulate services and products that meet quality requirements. If you are working in a compliance industry the latest regulations and statutes have to be translated quickly and efficiently to protect corporate reputation. For example, the information commissioner of the UK is now issuing monetary fines of up to £500,000 to public bodies which fail to implement information rights statutes effectively.
What intelligence products does the organisation require? Presenting intelligence makes or breaks its effectiveness. Banking officials stated that risk presentations relating to the banking problems that preceded the 2008 crisis were so complex that only a few individuals fully understood the depth of the problems in UK retail banking. Intelligence is therefore not an end in itself but a catalyst for action. Presenting quality intelligence products is vital and much can be learned from the UK police service, which has standardised intelligence products to achieve consistency and comprehension across all forces.
How can quality be embedded in intelligence gathering? This is the eternal question but quality can be pursued with purpose if the first questions posed are clear. Evidence-based decision making remains an aspiration for many organisations but confidence in intelligence raises quality as does the consistency of analysis and presentation.
Reflections on intelligence failures
Thomas Edison once said, “The successful person makes a habit of doing what the failing person doesn’t like to do.”8 The intelligent organisation might flirt with disaster but it can avoid NASA style catastrophes if it learns to use intelligence across all services. Intelligence is vital to the next few years of operations for both public and private sectors, as it can deliver transformation within only a few months. Think about Steve Jobs. Apple was considered a joke by a large majority of techie professionals during the 1990s9. Yet it rose again inexorably to dominate the music download market and technology design. Apple was failing for a long time but consistently applied the lessons of learning from failures to create business intelligence which allowed the organisation to hit new peaks of performance and design during the past 10 years.
Robin Smith is head of information governance at Northampton General Hospital NHS Trust. He can be contacted at firstname.lastname@example.org
Smith, R. Information Risk management research project, Northumbria University, 2011.