Here we go again, III

The lessons that can be learned from 2010 are many and wide. As one would expect, the list from 2008 seemed to mostly be about finance (and fiction). Now, we can broaden the view.

Just now, I was looking at some Wikipedia pages on biochemistry, in particular on chirality (note the uses). We would see this as handedness. Well, it seemed that it might be fun to use an analog of optical resolution as an overlay while looking at project (program) management problems. After all, has not this blog berated mis-use of mathematics (Effectiveness, Abstraction, and Computational)? As well, has not the concept of underdetermined come to fore, now and again? But, a new wrinkle, brought on by computation is visualization and the whole notion that some ephemeral digital state is similar enough to the natural (God made?) state to which (or for which) it's being proposed as equivalent (only in certain types of world views) for us to make decisions that are sound.

A white paper asked: Do Sensors "Outresolve" Lenses? Just how does (can) this be applied?

Well, some comments to blogs, such as to the flightblogger, suggest that the 787 program assumed too much of something and allowed things to get out of control by not watching closely. Say what? We'll get to that. Too, from our long experiences with those in power we know this, hubris colors their thinking more than does reality. Except, where that reality has to do with the size of their pockets. How did this come to be? And, does not a good general (military) know that he/she has to get out with the troops to know the truth?

Sensors are an analog for getting information. In any decision, and control, context, one needs feedback. That is, take the driving scandals that were running amok last year, at this time. As mentioned in regard to that, the key discipline would involve cyber-physical studies; as well, sensors become of real epistemological concern.

When a program doesn't have sufficient information, things can go awry. And, bodies may be required. Boeing found that it had to send armies of people out to help determine what was what. Was there some errant notion that computational frameworks could replace expert eye sight and observation?

What about lenses? Well, some of these would be related to sensors. Take eyes and their owner: would not rose-colored glasses influence attempts at accurate reporting? As well, consider that which is between the ears. Are those of the supposed highest order any more than those who have risen far beyond their level of capability (as the adage says)? Of course, we may add another, at some point, to the sensor and lens category, namely the filter.

But, let's stay with those two, for now. Notice in the white paper that mathematics comes into play for both sensors and the lenses. And, it is done in a non-trivial manner. In fact, a lot of the computation requires high-powered artifacts; that is, the class of computation that has been enabled by modern techniques is growing daily and is far out pacing any human parallel.

Except, we do know that people rise for more than their power-holding abilities; insight, to be discussed further, is important. But, that type of knowledge cannot be taught; one problem with science/engineering, it'll be shown, is that the educated intuition was thwarted long ago by certain types of preening intellectualism. That topic is big-T truth, of course,

Remarks:

06/28/2011 -- Have succeeded in getting this far with coming back. Engineering has KBE to keep it honest.

01/01/2011 -- This theme? We're done. Engineering is a shining example of human effort. Finance? Ah, cannot be said by a civilized tongue!

Modified: 06/28/2011

Valuing assets

How does this subject apply to oops ? Well, measuring progress is similar to determining value.

Too, plenty have argued that 'mark to market' has exacerbated the downturn.

We'll get back to this problem as one thing to do will be to document the effects of the recent relaxation of the rule.

Remarks:

08/17/2009 -- As promised, FEDaerated is here.

07/30/2009 -- Well, all of the bailouts from Ben and friends plus account rule changes sort of motivates the need for an econoblog that looks at things like what is necessary to support savers, those perpetually sacked ones. Where does the money go? Indeed.

04/17/2009 -- Minsky and the facts of ephemeral value are a couple of topics on the list.

Modified 08/17/2009

Fairy dust

Fairy dust, like its sib Happy Talk, has been part of the run up in business from a shaky start to a very flimsy structure. That the stock markets are dropping severely today (before the open of the US markets) indicates that the recent dust has not worked; that it sometimes catches into a frenzy is very much suitable for study.

Part of the dust influenced Alan's (he of the Congressional query, yesterday) long-time belief that banks (and other capitalistic organizations) could police themselves, that derivatives were magical (did not need scrutiny), and that bubbles could not be seen.

Yes, Alan, we cannot see the future. Science, therefore, has ex post facto eyes, for the most part. Any forward looking is highly constrained. It is mainly the business types who go out on the limb, extrapolating like there is no tomorrow, carrying with them the rest of us into perdition.

Until economics and business is more empirically (actually quasi-empirically) based, these burstings will continue.

Gosh, even the quants started to believe in their magic and led the financial engineers astray.

How to stop this, as WFB asked? Well, there are several ways. Expect these to be addressed in an incremental manner, including more technical analysis of the mathematical problems.

Remarks:

07/31/2013 -- Ben cannot unwind or taper down; he has too many Doves.

03/23/2012 -- Ben is doing a series of four lectures on his, and the FED's, role.

10/10/2011 -- The public is recognizing that we've been 'fairy dusted' the past few years. Was it meant to be a means of cover-up? Hopefully, Big Ben is seen to be as much of a culprit.

04/19/2011 -- On territory and its map.

01/19/2011 -- The quirks of capitalism are rank, not by necessity.

11/04/2010 -- Big Ben is still putting us at risk and trashing the savers.

09/15/2009 -- Lessons, one year after Lehman. Also, Time on culprits. Ben is happy-talking, again.

09/09/2009 -- Alan's reign will be looked at, in time.

08/31/2009 -- Go to FEDaerated to see Quant series that will expand to cover topics both theoretical and technical.

08/10/2009 -- As promised, FEDaerated is here.

05/18/2009 -- Oh yes, got us in a mess and still wants the bonus.

04/17/2009 -- Minsky and the facts of ephemeral value are a couple of topics on the list.

12/17/2008 -- Shoes continue to drop, but they are of several types.

11/20/2008 -- Boon and bust, the way of fairy dust.

Modified: 07/31/2013

Oops and more oops

As said before, ooops are everywhere and seem to abound. Ah, but we need to consider the other side, namely the Nooop and aah.

So, to keep it short, lets just look at a couple.

- Fannie and Freddie - this example (reactions by blogs) is almost archetypal for economics, with a core issue of free or fee. You see, these are close (one letter difference). But, they differ by a wide-range; the spectrum is as large as that of the open-source and proprietary stances (we need both). The real tragedy (see Remarks, for a greater tragedy) of the latest step is that common shareholders may lose (in fact, those that have already sold at a loss have ate it) while the 'fat cat' preferred holders will roll in the dough. Plus, former managers who ran these quasi-governmental entities to the ground have their monies and gigantic bonuses. As said before, that 'game' called the market is neither free or wise; and, those whose colored glasses argue for such need to look at quasi-empiricism and ponder a few things in regard to engineering mishaps (finance has taken technology and mathematics as the basis to build us a house-of-cards, essentially). The results of some newer methods are coming home to roost.

- Boeing stumbles again - at least, in terms of knowing how to relate to labor, if not categorically, then in particular instances (we'll go into this further at some point). How this will play out with the 787 will be of interest as the critical step of flying and testing in the air will be delayed, though we don't know if some other delay may have been lurking (so, there is a silver lining of sorts) and was about to reveal itself. The fact is that a whole lot of new technologies need to be proven. As comparison, the new Cessna program is planning for a 3-year period between first flight and first delivery. Boeing's truncated schedule looked suspicious from the beginning, to certain ontological views, that is. For some reason, an aura from high technology and applied mathematics distorted the sight of those who ought to have known better (again, more on this at some point, but for now, look at the early seeds and subsequent posts).

Remarks:

11/04/2010 -- Big Ben is still putting us at risk and trashing the savers.

09/12/2009 -- Sandbox was used without definition. Let's discuss that concept.

09/11/2009 -- Win and lose. Everyone wants the former. The latter actually is what balances the equation.

07/31/2009 -- Let's see, 5,000 got over $1M for services rendered. Well, that's probably a sign of being a best-and-brightest, at least to certain eyes; it's called rolling-in-the-dough.

Now, this can be used to illustrate how the game it to fill the pockets of a small set to an exorbitant amount. Does the game need to be that way? Hell no. We'll look at that some more.

03/30/2009 -- Near-zero will be looked at more closely.

01/26/2009 -- Now a new day and way to consider these matters.

09/14/2008 -- Minsky's hierarchy has been invoked on several occasions on the finance side of the blog's focus. It has been suggested that we could use this as a guide. For instance, proper hedging and some types of speculation ought to be consider okay. But, then after that, things become playground/sandbox in nature and ought to be handled that way.

And, despite the use of 'hedge' by some funds, such as Harvard's fund that has grown immensely, the types of returns that they have enjoyed come by either malfeasance (let us see what you're doing so that we can make our own assessment) or they're beyond speculation (it's near-zero sum, folks, despite our wish that we can justify huge returns). That is, exhorbitant gains come out of the pockets of the hapless, even if the public face might be that of a competitor, such as another hedge fund.

The real tragedy is that the Harvard's wins (and similar examples) lure folks like the CALPERS to think that they need to do the same thing. Even municipals are getting lured into the game.

But, here, via this blog, we're arguing for 'intrinsics' as necessary (my challenge to Harvard is to get back to your heritage - the Puritans); and, we'll get to defining what we mean.

In the meantime, what Buffett shows, with his involvement in his investments, is just one type of intrinsic relationship. There are others.

By the way, folks, all this silliness is only a few decades old; it has no real theoretical substance behind it; and, we can nip the bud now to create a better financial world for us all.

Modified: 11/04/2010

To the hilt

This blog started by looking at a particular development project's status with the intent to comment on a few modern predicaments that have been exacerbated by computational confusion. Well, in engineering, as said before, we have a real world that comes into play.

The same world influences the market, and things financial, but in an entirely different way that cannot seem to get its head out of gaming (apologies to the Olympic athletes, as gaming can have an honorable connotation or two).

In the 08/18/08 WSJ, Ethan Penner describes one aspect of the current problem in his op-ed ("How Low Interest Rates Contributed to the Credit Crisis"). Penner has one example that we can expand upon and comment about here. The following analysis will just be a small beginning.

Penner says that a key factor is that some retirement fund techniques will require a huge return in order to pay up as they promised (by the way, the use of entitlement applies here on several sides - who is more 'entitlement' laden in thought than some CEOs and some financial types?) . How many times have we heard 20% returns plus?

So, if the going rate for some real investment type is 6.5%, how does one get more? Well, the tranche method (Penner also has some thoughts on securitization's future) played that game, too. But, let's use a little story.

Supposing we had 100K bucks (later in the story, we'll multiply that by several 10s; as well, dampen any notion of rationality for a few sentences). Well, in the easy money and high liquidity times, we could have found someone who would have loaned us 900K bucks which would have given us a cool 1M bucks in total. Now, if we could get the money (900K bucks) at 5%, then we would make 1.5% for each of the nine 100Ks. The accumulation of return would give us the 20% on our original 100K bucks.

Get it? Smart or not?

Now, apply your multiple of 10s to the 100K bucks. Lots of people were making money this way; of course, what we saw, or read about, were the big winners. Then, we also heard about big losers.

Hah! Is this how an economy ought to work? Actually, a whole industry has been set up the past 20 years to foster this time of gaming which, by necessity, moves money from the pockets of the multitude of hapless to the golden (and more) purses of the favored few (those who have infinite entitlement - versus those who are only looking for some food and shelter).

By the way, this little example can be applied many ways to what goes on daily in the markets. We'll be getting back to that.

But, we'll also pose, and try to answer, some questions. Like, who would put $900K upon $100K (9 to 1 if you're counting)? In the old days, this type of number would have been a fraction (think the multiplier effect in macroeconomics). Why would I as a rational holder of $900K let you get the 1.5%?

If this type of leveraging was then extended (almost recursively), what value is there (of course, we see with unwinding that things do dissipate)? This brings up another side. If the one with the 100K bucks gets 900K bucks more and then has a -5% return, that would reduce the 100K bucks by half. But wait, the 5% would still be payable, so the 100K bucks would be even less.

Gosh, ought we to get the financial thing on some natural basis, not unlike using thermodynamics (no endorsement is intended, implicitly or otherwise) as some economists argue?

So, where is the accounting for all this? Some seem to think that the 'risk' ontology is sufficient; these need to look closely at quasi-empirical issues.

Remarks:

04/03/2011 -- Need to look at some background. Too, tranche and trash.

03/17/2011 -- Politicos might actually be compounding the issues.

08/24/2009 -- Last year, Ben blinked and panicked. He frantically pulled out all stops as if with no thought for tomorrow. Now, he has no use for 'mea culpa' big daddy that he is. Ben, start to unwind now. The Vienna School's view that these things are undecidable (which is a computational issue) is right on.

07/23/2009 -- After the bust and the rebound, toxic assets are still a problem due to tranche realities.

06/07/2009 -- Say what?

12/17/2008 -- We'll use made-off in lieu of ponzi, henceforth.

10/27/2008 -- Yes, things fell apart for several reasons: fiction, leverage, and more.

10/11/2008 -- It keeps getting more interesting.

08/24/2008 -- This example where we see a 9 to 1 increase off of $100K is equivalent to a reserve ration of 10% which can be considered a historically low figure for the reserve or a high multiplier. This notion is related to leveraging in the sense of creating something out of nothing from one view. Of course, as argued before, the lowering of the reserve ration goes hand in hand with increasing use of mathematics through growing computational prowess which can exacerbate the Minsky ponzi tendencies, as we've seen of late. If we're going to model the economy via computation, why not base it on some physical analog, like energy (no endorsement intended)?

Modified: 04/03/2011

Oops and models

It is always good to see someone express thoughts well, especially those dealing with important subjects, such as Oops and NoOops. Recently, a New York Times opinion'er hit the mark; Nicholas D. Kristof wrote (July 3, 2008): In short, millions of things could go wrong. But when there’s a good model in place, they often go right.

Now, this blog deals with the fact that 'oops and loops must lead to oops, by necessity. 7 'oops 7 started with an engineering focus of a particular flavor, then branched to finance (the credit crunch is going to be looked at here from several sides - fortunately, the WSJ has been probing deeply into the current conundrums), and now finally is covering the spectrum of human life (with one particular having a medical angle - due to a personal interest in bio-medical engineering). However, the airplane particulars will remain in the discussion for purposes of illustration since a major program will be moving along a test axis shortly.

If you now know the context of the above-referenced article, we can understand the notion that 1M things could go wrong is true in many situations. And we can understand that control (or, risk management, if you would) requires a model. So, the types of things that help us live better and accomplish predictably are the concern of science and engineering.

Engineers help us to improve things, essentially by working the models. There are modern models that have a whole lot of history. But there is one thing to note in regard to models: the computational frameworks are still in their infancy, comparatively, and quasi-empiricism has more of a basis than many realize.

Remarks:

11/20/2008 -- Boon and bust, the way of fairy dust.

Modified: 11/20/2008

Middle and out

This little blurb is part of a continuing pro-log leading to explicit analysis of the problems related to earned value in the situation of globalized organizations, abstracted models, and a gaming-based ontology.

Most engineers will be familiar with the concept of the middle. Good projects work middle-out.

To see this, let's use the computer as an example. In the modern era when computers are everywhere (are we tired of ubiquitous, yet?), we can think of the interfaces between hardware and software. At the boundary, there are always problems. Who drives? Software? Hardware?

In a project that is defining a new 'system' both the hardware and the software must gel at some point. Of course, the latter is more malleable (we like to think; changes have consequences, though). But, hardware can change. Analysis at the middle-out position has allowed successful convergence many times. Though, one must remember that iterations may be necessary in order to really optimize a design.

Now, in projects, middle-out makes a lot of sense as a means to describe what goes on between levels and organizations. It is hard to attain such a balance for many reasons, not the least of which is that the analytical demands that need to be met are operationally-based from current work (when doing something for the first few times).

Systems engineering was developed to look at these types of issues. But, it needs to work with a whole lot of other disciplines.

In modeling, we like to use top-down and bottom-up. That top-down world loves power, and the exhibitions that result through the use of power. The bottom-up? Well it's not so easily described given the morass of the pits.

That is, the top-down involves a movement from the one to the many. The particular spread as things fan out can vary widely. Throughout the modern realm, there have been experiments with depth and breadth of this fanning.

Perhaps, the emphasis on the top-down has come about through its efficacy in many situations. It has been shown to work if there is a sufficient number of willing effectors (with characteristics as being healthy, cared for, etc.) at the levels below the top-most node (CEO, etc.).

That brings up an aside that the top-down view that doesn't try to keep its lower levels healthy is more than suspect; it is the major bane preventing an economic expansion that is our right. To wit, a whole lot of problems related to pay (hugh imbalance), motivation (hands-on needs to get respect back - how do we do this?), etc.

Also, technology requires a different balance. The top-down view does not, nor can it, know detail (SOX notwithstanding, which is basically financial in motivation). This is something to look at; abstraction has a purpose; things-in-themselves, well, some have purpose prior to any of our wanglings, but they can out-rule abstractions.

So, what are we to do? Well, for one thing, be aware of the dynamics and manage accordingly.
At the top, let the Board of Directors be more than figure-heads. Get a CTO involved who really knows and isn't just a gamer. Elsewhere, don't expect that the military model of command-control applies everywhere.

At the bottom (and between), work for innovation and trust. Preserve performers. Provide mechanisms for continuing improvements. Nothing new. Except, don't expect to be a company that people will flock to if you don't apply your principles (don't just talk them).

In a new product, who would support the middle-out position between the business views driving the motivation and the end-of-the-chain (poor slob, getting all the grief; trying to manage expectations that are possibly not realizable?) people?

Well, if one is going to argue for systems engineering, it would have to be independent of, and not accountable to, those driving the requirements, would it not? That is, technical projects get in trouble due to too few technical resources of an integrative nature being at hand as they are needed. Lean is partly a culprit (it works ex post facto in making improvements).

Remarks:

01/15/2012 -- A new wrinkle: perhaps, the middle way toward the unfolding of potential for all.

11/30/2011 -- Of late, there has been an OWS movement. It seems to not be hierarchical; that irritates the top-downers who like to think that their controlling viewpoint is truth. Have we ever seen a true middle out that respects the bottom up? I don't know. Even in science, you have those who think that theory trumps. Engineers are smart enough to know better. Ah, people and their foibles.

09/14/2010 -- Must and may. Two important concepts.

09/02/2009 -- Lets face it, folks, undecidability needs to be discussed and adopted in any complex situational setting, especially if computers are involved. Only hubris pushes us to make loud exclamations about what we're going to do in the future.

08/31/2009 -- We're going to look at this, again, from the finance view as we expand theoretics and technicals via an econoblog.

07/05/2009 -- We have to see how the computer (and computerism) influences this.

06/15/2009 -- Globalization, and capitalism, now a dirty word, according to one in private equity.

Modified: 01/15/2012

Risk versus effort

In general, these posts look at what lessons can be learned from our daily grind with 'oops and loops, with the inevitable oops that occur now and then. The idea is to not beat on anyone; rather, one motive is to show the necessity of truth engineering as time continues to bring forth issues that seemingly are boundless.

Have the planning guys really grasped how to handle risk? Granted there are differences in the ontologies of the technical and the managerial on this subject, yet even within the technical side those who think that they can minimize risk to almost nil ought to re-examine the basis of their world view (hint: quasi-empirical issues).

Too, if reducing risk (technical, not financial) is accomplished by pushing out effort, then things ought to get suspect.

One hears a lot about how many modern views are better analytically (we heard the concept, parametrically consistent, referenced yesterday), yet, things-in-themselves do not necessarily agree with our confidence; this ought to give us pause on several sides. We'll be looking further at issues involved with technical risk.

Now, in terms of financial risk, one can only hope that markings stay away from the regions of model (partly myth) and myth. How? We need to look at that further.

Remarks:

08/01/2013 -- Ben cannot unwind or taper down; he has too many Doves. We'll have to get back to the king thing (yes, the divine rights of the CEO, new royalty, in other words) and dampening of these types by a new outlook (Magna-Carta'ísh).

01/17/2013 -- Grounding due to fire.

01/31/ 2011 -- Referenced from 4th January. As well, remember how 'model and myth' was decided by Congress, despite protestations by the bean counters? Note how their decision has allowed expansions that may be bordering on bubble.

08/31/2009 -- New dynamics.

01/22/2009 -- Eventful year all around. Now a new day and way to consider many matters.

Modified: 08/01/2013

Time goes on

The WSJ plays a central role, as do other news and analysis sources, but today it hit the jackpot in terms of the interests of this, and a related, blog.

On 1/15/08, a main story covered the winners in the sub-prime event, confirming, in a sense, that these things are zero-sum despite the hype argued by some economists. We know about the losers who range from people who face, or have faced, losing their house to various financial institutions that bled heavily, including some smarty-pant hedge funds (more on this later).

Well, on the receiving end of some of those loses is another hedge firm with a different set of bets.

What is common is that the financial instruments involved are relatively new and seemingly entrenched now (Greenspan is consulting on these). Well, those higher-order thoughts involved are duly noted here, but, folks, believe it or not, we're talking hot air, for the most part (despite the fact that many live a fairly rich life while the multitudes suffer from want - age-old problem, in a sense).

In the pm, WSJ noted that there would be a 787 delay which will be published on 1/9/08. Well, there are connects between these two things that will be discussed here and as part of the expansion of truth engineering.

Yet, there is a supreme difference. Finance does not deal with reality to the same extent as does designing and building a plane. In the latter case, the thing can be put together and flown. But, one would hope that such a phase would take precedence over trying to get the means together to put the things out for use. There are several lessons here, perhaps, that we can look at.

In the former sense, there is a wide gap between reality and the workings. Okay, all these numbers flow through the computers and out to the tape (for the youngsters, that was first - all the titillating modern display are mainly extensions of the ticker). Supposedly, the overseeing agencies have put effort into making sure that what flows can be justified (audited), though I really wonder, as can they track 'short' actions that are purely virtual (no, and getting deeper will see that derivatives can hide a whole lot of nothing).

Yet, those numbers, in a sense, represent what is supposed to be a support for doing something real (say, provide food to eat, goods for use, etc.). Finance will always fail that test; hence it ought to be tied more closely to something real (if not gold, pick some arbitrary element).

Program management has some equivalent pitfalls, though the case is better due to the big test environment created by nature and our extensions. One of these is related to earned value which has to do with knowing where you are in the real world sense as you look at some map that is supposedly sufficient to provide guidance through the world (speaking here of the virtual overlay of any project - where at the other end is going to be a real entity).

Somehow, we've lost sight of some key issues. Well, thankfully, events bring about examples that can be used for study.

Remarks:

08/01/2013 -- Ben cannot unwind or taper down; he has too many Doves. We'll have to get back to the king thing (yes, the divine rights of the CEO, new royalty, in other words) and dampening of these types by a new outlook (Magna-Carta'ísh).

09/09/2009 -- Alan's reign will be looked at, in time.

Modified: 08/01/2013

Before and after

New poll, 01/11/08.
One wonders about the games played in a 'market' economy, though 'games' might just be some type of human proclivity with which we'll always need to cope.

Today, the FED (the money printers who want to support 'moral' hazards in the market, it seems) said that it would reduce the rate which drives those parts of the investment realm that are favored by the more conservative who don't like having so many hands trying to remove whatever money is there in the pocket. Some analysis seems to indicate that the present trouble was due to too much liquidity from the rate being too low.

Why always this bail out of frivolity? Recently, I read where some manager said that risk analysts had told him that they could calculate to within a couple of decimal points. My reaction was: what? in what universe? dreamland? Of course, they can provide numbers; what reliance can we place on them?

In another realm, in May of 2007, Business Week had an article related to 'crunch time' at Boeing. A reader comment there noted that the 7/8/07 looked to be a 'show and tell' (AWatcher May 22, 2007 3:26 GMT) (or as Leelaw #50594 likes to say 'potemkin' in regard to the hugely publicized affair).

Yet, we have about that same time comments from the CEO saying that "problems in the Dreamliner production won't prevent Boeing from delivering the 787 on time", though there were various mentions about experts doubting that Boeing could pull this thing off in the time frame planned years ago. Also, polls seem to indicate that most who participated thought that there would be delays (long before Boeing announced the schedule shift).

So today, more rumors are coming about in regard to another delay; of course, some of this just might be mongers getting into their 2008 stride.

Where are the mature heads that want an exuberant, yet controlled, economy while at the same time wanting 'wise' project management?

The May 22, 2007 comment asked these questions which are still apropos with some unanswered.

• That the program is allowing pieces to be shipped without all the 'stuffing' reeks of a 'show and tell' event for 7/8/7 (well, marketing is running the game - could be the practice assembly that wasn't scheduled?). [yes, a practice put together, but the hoopla continued unabated]
• Can this plane hit May 08 even if there are some delays (however slight) getting the test vehicle off the ground? [well, we found out that it would not]
• There are so many new factors, how can there be such an abbreviated test period? [that talk of an abridged test has gone away, we hope]
• If a time-line re-adjust now would produce a better plane, why not bite that bullet and do so (After all, Boeing must know a lot more now than 2-3 years ago; to keep asserting that things are fine will look worse later.)? [someone needs to carry forward a more wise way to handled these things - now, it looks like a cat-and-mouse play - what is believable?]
• Why doesn't the 'Mythical Man-Month' principle apply here? [open question]
• Also, why doesn't Lean say "stop the line" when there is a problem (don't push defects downstream)? [well, the line did eventually stop or slowed to a snail's pace]

Well, all the things asked by these posts, beginning with the Seed post still apply.

Slogan: modus operandi involves 'blog and truth' and minimizing 'hogwash' in all affairs.

Remarks:

08/01/2013 -- Ben cannot unwind or taper down; he has too many Doves. We'll have to get back to the king thing (yes, the divine rights of the CEO, new royalty, in other words) and dampening of these types by a new outlook (Magna-Carta'ísh).

09/02/2009 -- Lean assumes a current framework which can be improved. That the process is still effective during the change can be checked easily. However, if it is not still effective or we do not have a stable framework, then we were, by necessity, in the undecidable state.

05/18/2009 -- Testing in flight is within sight.

Modified: 08/01/2013

Tranche or not

Earlier posts considered whether we are putting too much trust in mathematics and the related computation (issues of quasi-empiricism) and in processes based upon those two. There were allusions to problems that come out of abstraction as it pulls one away from substance toward what are 'bubbles' (a bane of modern existence). That is, having more substance can be thought of as equivalent to being more 'real' (opening up a door here).

One problem to understand and to control is application of the computational to objects-in-themselves (those who want to knock me as Kantian may consider their understanding of tribalism on intellect). On the computer, it is easy to reboot and to start over. Simulated errors and faults (on the computer) have no consequences in the world.

Yet, we cannot do similarly, that is reverse time or consequences, in the real world except for limited types of things.

Simulation has brought about troublesome thinking especially in so far as success there makes it appear to be 'okay' that one takes simulated data and acts as if it is real. It used to be that a prime counsel, in defining and using numeric processes related to complicated natural situations, was to not confuse the observed (measured in the world) data with something that was generated by a model.

Of course, where one can occasionally calibrate some model against the world, such intra-computer work is of use (operationally sound).

In the sense of a new product, especially one like a plane, the vehicles that will fly and otherwise support testing would have more substance than sub-assemblies or those artifacts with which abstractionists like to be bothered, even though the sub-assemblies in themselves can be tested or that the artifacts are amenable to analysis. And, in the case of a simulator, flight data would support calibration, so to speak.

Looking at the 'tranche' logic of finance makes one wonder if project management (in so far as it partitions and assigns and then has the worries of earned value) can have a similar set of lurking failings. Ah, the tranche, a mechanism to extend ratings above what is actually supported by the underlying instruments.

There seems to be some analog between the tranche mis-thinking and planning versus status measuring that we'll explore further. It's easy to poke fun at the money crowd as there really is no measurable basis that has been agreed upon and that has lasted. Yet, that 'froth' and 'bubbles' come about indicates that there is a problem.

Project management is a little better if is deals with a product that substantially deals with matter (such as a plane). But, as we all know, computer system project management is still more an art than a science despite the best efforts of DOD (US) and Software Engineering Institute, though this work may help prototype the types of control systems that will be needed.

Remarks:

08/01/2013 -- Ben cannot unwind or taper down; he has too many Doves. We'll have to get back to the king thing (yes, the divine rights of the CEO, new royalty, in other words) and dampening of these types by a new outlook (Magna-Carta'ísh).

05/25/2011 -- Stinking realities, such as, lemons problem, dark pools, ... Oh, so much to look at! Does the idiocy have any limit?

04/03/2011 -- Need to look at some background. Too, tranche and trash.

01/01/2011 -- We have four last posts of December under our belt. Also, we lost our chance at setting things right.

11/02/2010 -- Two years later, the message is the same, except some changes have occurred. Of real note is that the jobless rate is high; out-housing really set up for that. Also, we need to re-look at that learned from the 'vons' guys, Ludwig and Friedrich. See Near Zero.

07/23/2009 -- After the bust and the rebound, toxic assets are still a problem due to tranche realities.

06/07/2009 -- Say what?

02/18/2009 -- We can look at why securities become toxic, almost by necessity.

01/27/2009 -- Lessons to be learned (as opposed to learnt), including, by necessity, Ponzi.

11/12/2008 -- Well, things fell apart fairly quickly, starting in September of 2008. By N0vember, there was general spooking. Starting in September, movements toward nationalization sped so fast that it was easy to forget that a Republican administration was still in the White House. Talk about rewarding hubris and moral hazardness!!!!

Modified: 08/01/2013

IQ and PIQ

Flynn's work on IQ shows that the IQ level (as determined by tests) increases by generation thereby requiring that the average value for the tests (100) needs to be re-calibrated. Other work shows that there are definite ways to look at how intelligence may be rated.

For now, let's just consider two that were considered in the reviewed book. The main thrust has been to measure ability to handle abstractions and their myriad layers as if that is how one gets to real knowledge (theory of everything - which, of course, pertains to nothing). A more operational focus would look at functionality (oh, by the way, which is more important for a plane - looks or being able to perform).

It is functionality that gets the short view of late. Why? The whole scheme of things seems to be going toward abstractions (covered in early posts here and in Truth Engineering) where those who excel on this level in certain types of instruments gather whole bunches of moolah (in many cases, with explicit take-aways (of bread, essentially) from those who are actually performing in ways these abstractionists can only dream about - many of whom have servants [essentially] who keep them afloat - often these types do not even know that their backs are unclothed [much more of a problem than the naked emperor] or that they are being carried about).

But, let's get back to IQ and the accumulation of this in both the functional and ethereal (of course, management and that dismal of sciences, economics) domains over time in an OEM of complicated things like a new airplane, let's call it PIQ. Well, PIQ would show increases within a program; so we see variants that exploit new knowledge plus earnings from improved processes. This is all well and good.

But, too, we see that within some type of operational methods (even including types of farming out) involved with continuing improvements within a technology line (of which we see the culmination that has been extremely successful come about - this is about 10 or so years ago), the progress makes things better and better. The PIQ increases; even generational dynamics would cause an upward movement; things work as expected, for the most part.

Now, and how is this not seen (except for the fact that those who really know seem to have lost out to the dreamers who deal with abstrations -why? - well, it's partly thanks to mathematics and the computer), when new technology comes in across the board with across-the-board changes in process and business thinking, well, it's a whole new ballgame (thinking about things, such as, undecidability ought to get some play - risk-based thinking is too tied into the blinders put on by the gloating about the effectiveness of mathematics -- without really understanding why we see this).

So, the PIQ of a farmed-to-ee cannot just on the dime get to the state required by the farmer-outer. It could probably even be shown that the internal PIQ could have converged long before now (oh, but it was money and risk at issue). Yet, those with their heads in the abstracted clouds cannot see that their feet may be on other than functionally-capable grounds (grounding is necessary, as that which flies is really an earth-bound beast until it overcomes constraints - and, even then, it's only for some finite time).

But, another benefit that derives from PIQ is knowing how to do things when necessary, such as 1) how to avoid stumbling, 2) how to recover from a stumble, and 3) how to learn from the fact that a stumble occurred.

One thing attributable to PIQ is believability which does not accrue to heritage alone. It is not that there is a general negative view in regard to due diligence (though, that lowering direction may just be happening monotonistically), rather business has taught us to doubt since a lot of focus goes into efforts that save and prune (almost to the point of anorexia, it seems, many times) just so that some pocket (or set of pockets) gets filled (okay, unfair perhaps, but not entirely untrue).

Some programs, such as we see with medicine, need to have a focus that is above certain goals with regard to which the heated mindsets are eternally engrossed (and, for the most part, dealing with things of no substance).

Remarks:

09/02/2009 -- Lets face it, folks, undecidability needs to be discussed and adopted in any complex situational setting, especially if computers are involved. Only hubris pushes us to make loud exclamations about what we're going to do in the future.

05/18/2009 -- Testing in flight is within sight.

11/01/2008 -- Much has happened with regard to the schedule, the suppliers, and more. Boeing announced some insights about its 787 planning. Before that, the idiocy of a truncated (abbreviated) test cycle was changed.

Reminder: at this point last year (we can pinpoint the specific dates), there was still some talk about delivering in May 2008.

Modified: 09/02/2009

Believability

Evidently, there are some types of engineering that map well through the phases from conception through production where the products get out to the market quickly. Many, who strive for the new and human-less (green field, lights out, ...), want this. Okay, it has been shown to reduce touch labor, if things work.

Think quickly, though; how many of these types of things are hugely complicated in either type or aggregation across the set of sub-entities? How many have serious mission requirements that must be met?

Somehow, one sees that success of this type requires human talent, not easily obtained in many cases, meaning, of course, that it takes years of experience to 'get the arms' around some of these problems.

Ever wonder why the younger successes get their rewards in the 'virtual' world; that is, what do we have involved there but concepts mapping to a phenomenal experience that is ghostly at best (so, it can persist across sessions and the ether space - what substance is there?)? What we see here is that the new generation applies some bunch of tricks recently learned, many times academically, in a situation that is ripe for these tricks, is it not? The older folks could learn much of this, to boot, given the chance.

So many of the 'virtual' successes may appear to have some type of serious foundation, yet in actuality they are not that well founded; it's just that we've allowed opportunism to be rewarded (a whole set of analysis possible there). Oh, we like to put 'entrepreneurship' as a label to cover what is really going on (gosh, do we ever like to coat things platitudinally).

Let's see, so we can have the computer being used to make a large schedule dealing with oodles of activity steps across an enormous period of time and somehow the issues of feedback, analysis, course correction, etc. are overlooked. Well, is it people or the computer that drive a process?

Too, we see the computational put into the place of real experiments. Mind you, this is where we ought to be putting our attention; yet, the issues of quasi-empiricism have to be addressed and are essentially being ignored.

Then, we have the talking PR events.

Where or how does one find the way through the morass? Is there something about this that might point back to a world view (and its associated wet-ware wiring) that is heavily influenced by computer gaming?

Remarks:

12/17/2010 -- These types of issues are continually there for our resolution.

09/02/2009 -- Lets face it, folks, undecidability needs to be discussed and adopted in any complex situational setting, especially if computers are involved. Only hubris pushes us to make loud exclamations about what we're going to do in the future.

05/18/2009 -- Testing in flight is within sight.

11/01/2008 -- One has to ask what is the parallel in engineering, and program management, to the fiduciary duty of finance. In regard to the 787 project, much has happened with regard to the schedule, the suppliers, and more. Boeing announced some insights about its 787 planning. Before that, the idiocy of a truncated (abbreviated) test cycle was changed.

01/11/2008 -- One has to wonder what amount of forethought can make a process successful the first time through. Is it not our experience that a least one pass is required in order to prove the process (somewhat indicating that proof is not in the abstraction rather it is in the realization)?

Even highly trained and capable personnel, such as this medical article discusses, require a check-list to help guide a process through all the variations of a situation. ...

Oh yes, using a checklist from seemingly similar processes can be a good starting point; yet, we have to ask the question, do we not still need a run through? For a plane OEM, does this not involve several things such as flying, working the production issues, and more?

Modified: 12/17/2010

'Oops and loops lead to oops

Even doing nothing can have consequences which might be interesting to look at.

However, we want to look at efforts of doers that have results which imply then that we'll have some 'oops through which the doers need to leap as well as the loops involved with doing it again (any good learning circuit involves feedback and knowing when to quit).

Of course, that oops can follow is to be expected. How well these are managed is a key factor.

Gosh, just parsing through this post so far offers up many nuances that could be explored in terms of the former focus, but we ought to let that lie for the time being. There are many other useful twists to turn.

An example might be driving given some habits that have come to fore with the gaming generation. How many oops occur from inattentiveness of various sorts?

Here are three, of many, recent possible examples of problematic driving.

• going along a familiar route, at an intersection, turn by rote, that is, attention of the uper cortex elsewhere, driving being done in a reactive mode, not observing, finding that there is a blockage in the lane, thankfully being aware enough to stop, how many times is the reaction time too long for safety?
• driving with divided attention, due to too little thought being given to processing the data related to the driving act (text-messaging, etc.), again, in some situations, this can have serious consequences
• not accounting for possible moves by others, such as speeding pass some cars in a queue in a lane, completely ignoring what has motivated the defensive driving moral

Though a route may have been followed many times, each time through is not a replay of the former times. The data related to the current route needs to be processed and handled. Applying rote responses can be problematic, even though, for a whole class of needed actions, we use what has been learned.

As, we can always ask: how often are the situations so novel as to require creative means? Well, one retort would be that it would be first time through.

This little thought could be applied to planning, especially in terms of earned value. Analytics ought not be weighted too heavily the first time through, success with parametrics notwithstanding. It may be that the thread that runs through time (collapse of the graph on the critical path, so to speak) is such that only routine methods are necessary.

Yet, on the first pass, even the first several, one might think that markers and milestones themselves ought to be scrutinized. Nothing would be entirely routine in this scheme.

Of course, driving like that would be extremely tedious. We want speed (and spin).

After thought: can the computer's role as simulator (of which there are several types and uses) remove (or is it reduce?) the necessity of proof in reality?

Remarks:

03/25/2013 -- The Atlantic had an article about King Abdullah II. Now, he is an example of a doer, from several angles. What I liked when I read it was that while being educated in Massachusetts, he bussed tables. What that means for those who don't know is clean up dirty dishes and such. When I, as a young man, was in the US Army, we had still had KP duty which included such types of things. Another task that ought to be tried once by everyone: cleaning the grease pit.

12/14/2010 -- This post deals with, while not explicitly stating so, issues related to compiled knowledge.

Modified: 03/25/2013

Carts need horses

Sometimes a production process proves to be problematic even in the best of situations with products that have been made before.

With a new product, can one expect to spread production before the concept has been proven? Even with the best of analytics, could this be somewhat like the old adage of putting the 'cart before the horse'?

There are development issues to consider, too, especially with all the new capabilities that enable and lead toward efforts at a geographically-dispersed team.

The distributed model might expect suppliers to become expert quickly in a new area; attainment of expertise requires time (and one might add repetition, continued improvement, and other practices associated with the best efforts).

Farmed-out work has a worker and looker flavor needing insightful overview, hopefully with more than just the critic's role for the looker. Expertise is not a vicariously obtained attribute.

Too, would prudence suggest that production might need to lag behind progress on the proof axis?

In the past, the effort to create a physical product model helped the 'proof' advancement; with the onset of computer modeling, the question arises of how much the model may replace reality. Much about that question is still an open issue; when the product is complex and has stringent performance criteria, ought we expect a stronger temporal tie between analytical tests and physical tests throughout the process?

Remarks:

01/19/2011 -- Update1 and Update2. The focus now will be mostly the idiots of economics/finance.

09/02/2009 -- Lets face it, folks, undecidability needs to be discussed and adopted in any complex situational setting, especially if computers are involved. Only hubris pushes us to make loud exclamations about what we're going to do in the future.

07/14/2009 -- Nope, confounding continues.

05/18/2009 -- Testing in flight is within sight.

01/28/2009 -- A few related posts that came later: IQ and PIQ, Earned value, Hype cycle, Outsourcing as panacea. Expect a recap on this theme.

11/26/2008 -- Problems continued to arise in 2008. As of now, some static tests have been done. But, issues with supply management were troublesome. Of course, an IAM strike caused a little delay. But, there has been no test flight, as of yet, so functional issues remain more unknown than not. See Polls for an idea of opinion at various points.

Modified: 01/19/2011

Benchmark and performance

What is the saying? If you want something done right, do it yourself?

Well, we can't all fix our own cars, perform surgery on our own hearts, and such. Yet, that we can push the farming-out envelope too far will be part of the discussion.

Farming out work can also be having someone do what you don't want to do, and it's not an un-smart move. If something has been done before and what is being sought is to have better ways (by cost or what have you), then certain types of supplier-chain relationships can make sense.

However, such farming out, when there are new horizons to conquer, can be thought of as pushing difficulty to someone else. In short, avoiding responsibility (or, call it risk sharing). That is, letting someone else do the creative work and just kicking back and evaluating the results relies on problematic benchmark management.

How about another saying? I don't know what I want but can tell you when I see it.

Do we see requirement and specification work falling into the trap of show me and I'll let you know? If something has not been done before, can doing a 'game change' by modifying terminology help obtain the necessary performance?

So many questions to ask and try to answer. We need to look at issues of measuring progress to sort out these benchmark and performance issues.

Remarks:

09/02/2009 -- Lets face it, folks, undecidability needs to be discussed and adopted in any complex situational setting, especially if computers are involved. Only hubris pushes us to make loud exclamations about what we're going to do in the future.

01/23/2009 -- Expect more effort in firming up the earned-value (and related) discussions.

11/01/2008 -- In the fall of 2008, IAM went on strike. Around the time that SPEEA would begin their talks with Boeing, the company announced that it had learned a few things about outsourcing. Imagine that! Of course, a post here had already made a parallel between outsourcing and leveraging, that bane of the financing world.

Modified: 09/02/2009

Cramming for the exam

There is always a disparity between what management might wish and hope to accomplish and what engineers and builders can actually do to produce a viable product. Therefore, we rely heavily on tests to close the gap (one attempt at empiricism). But, the emphasis has to be on doing the work and ensuring that the product is safe.

Introducing systems engineering and advanced computer systems might help but do not remove the fact that we do not have 20-20 foresight.

Getting to a point where the schedule is without a buffer is troublesome since the schedule can be adjusted at several points (in fact, advanced project management might argue that it 'ought' to be) thereby showing some insight to the problems that have encountered (assuming that they can be discussed).

A test situation of a major product is much more than just cramming for a final exam.

Remarks:

08/01/2013 -- Ben cannot unwind or taper down; he has too many Doves. We'll have to get back to the king thing (yes, the divine rights of the CEO, new royalty, in other words) and dampening of these types by a new outlook (Magna-Carta'ísh).

05/25/2011 -- Such as, lemons problem, dark pools, ... Oh, so much to look at! Does the idiocy have any limit?

01/19/2011 -- Update1 and Update2. The focus now will be mostly the idiots of economics/finance.

09/02/2009 -- Lets face it, folks, undecidability needs to be discussed and adopted in any complex situational setting, especially if computers are involved. Only hubris pushes us to make loud exclamations about what we're going to do in the future.

07/14/2009 -- Nope, confounding continues.

01/28/2009 -- Earned value issues continue to be of interest.

11/01/2008 -- Much has happened with regard to the schedule, the suppliers, and more. Boeing announced some insights about its 787 planning. Before that, the idiocy of a truncated (abbreviated) test cycle was changed.

Reminder: at this point last year (we can pinpoint the specific dates), there was still some talk about delivering in May 2008.

Modified: 08/01/2013

Reasonable effectiveness

The steps to a new product can be long and arduous. The computer has helped improve the situation on many fronts, such as design and analysis, enhanced products through embedded systems, and efficient processes, to name a few.

In short, effectiveness may be a measurable property. So, one might ask a question about the reasonable effectiveness of analytics such as those reported recently where physical tests help confirm analytics and product properties. Learning to balance between the sufficiency of model and any necessity of the physical foundation is still an art; this has historically been less troublesome overall in engineering than in finance.

Remarks:

06/11/2015 -- There will be a rework here and a rework there.

09/02/2009 -- Lets face it, folks, undecidability needs to be discussed and adopted in any complex situational setting, especially if computers are involved. Only hubris pushes us to make loud exclamations about what we're going to do in the future.

06/30/2009 -- Another delay (is the project out on a limb?).

01/22/2009 -- Questions to ponder include how does engineering handle hype? We all rely on, and must trust, that discipline's prowess.

11/26/2008 -- Boon and bust, the way of fairy dust.

10/27/2008 -- Yes, things fell apart for several reasons: fiction, leverage, and more.

09/11/2007 -- On another note, a summary of the vote: Date, Total (I think so, Praying for, Maybe not, Nope)

• 9/5/2007, 47 (3, 5, 9, 27)
• 9/9/2007, 75 (13, 8, 11, 43)

Modified: 06/11/2015

Unknowns and unknowns

Generally, our progress involves adding to what we know and what we can do; engineering is a fairly systematic application of what we know about what we can control. Yet, there are unknowns which may vary in importance from 'of no consequence' to 'we better pay some attention.'

There was some mention yesterday (09/05/07 conference call, see flightblogger) about not knowing what-is-what until you get to where you have to deal with what. This sort of suggests that part of a schedule would be actually giving time to work several things through a process before trying to lean-and-efficient the thing. Otherwise, you're talking only in the abstract and allowing those things-in-themselves to have little ground. This can bite one.

Which brings up not knowing what we don't know. The financial types have been discussing the 'black swan' theory as it pertains to our inclination to over layer what we don't know with what we have known. That is, do we need to be better about expecting the real unexpected?

This issue does apply to engineering, as well, in particular when what we know is either relaxed or we make mixes of what we know in a new fashion. In the first sense, unknowns will be more problematic in less stable domains; in the second sense, using lab results and making sure that extreme values are tested are a couple, of many, techniques that we have come up with.

In any case, time is usually not of overriding importance unless you're heading toward a crash in the wall. But, under such conditions, one wouldn't be experimenting with fundamental control issues. 'However long it takes' is the real key for handling unknowns.

Remarks:



04/07/2012 -- Flightblogger ends, as least, Jon's watch. Some issues raised five years ago are still apropos. The context may have changed a little, yet, perhaps now is time to re-address the themes.


09/02/2009 -- Lets face it, folks, undecidability needs to be discussed and adopted in any complex situational setting, especially if computers are involved. Only hubris pushes us to make loud exclamations about what we're going to do in the future.

09/02/2009 -- We need to assess wind direction, many times.

05/27/2009 -- That we have topsy-turvy needs to be addressed more fully in both an epistemologic and an operational sense.

01/27/2009 -- Lessons to be learned (as opposed to learnt), including, by necessity, Ponzi.

06/14/2008 -- Early posts were related to engineering, but the tone of the blog now covers the gamut. What we see with engineering can be tested since science is available; what we see with finance and marketing will continue to be more problematic and therefore of interest.

Modified: 04/07/2012

That seductive abstract

As mentioned in the earlier list, abstraction has a lot of modern appeal thanks, in part, to computation. It's also very seductive in the drive for minimum costs or for the most lean effort or any other quest for the optimal.

Yet, an experienced engineer will tell you that no amount of modeling prowess replaces the thing-in-itself. That is, even an advanced 'second world' (or call it holodeck) experience is not reality. Just like a simulator experience is not the real thing.

So, how does this problem play in the stacked deck that we see with CAD and CAE (CAx to some) in the context of a complicated product? Well, given a product with new material, process, and configuration, are we to believe that the analytics are so strong so as to push us to think that we can ignore risks that may be inherent (will be discussed further)?

One thing of importance here will be quasi-empiricism versus a focus on foundations. The latter seems to take hold when the less 'hard' come to fore (finance, etc.).

Stay tuned, as this topic will keep reappearing.

Slogan: a new product, even though engineered by computer, is a hypothesis that needs to be proven (not hyped).

Remarks:

01/17/2013 -- Grounding due to fire.

11/02/2010 -- This post is 3 years old. Originally, the context dealt with engineering. But, finance soon came to fore with its importance to capitalism. We need to redo money, essentially.

09/02/2009 -- Lean assumes a current framework which can be improved. That the process is still effective during the change can be checked easily. However, if it is not still effective or we do not have a stable framework, then we were, by necessity, in the undecidable state.

05/27/2009 -- That we have topsy-turvy needs to be addressed more fully in both an epistemologic and an operational sense.

01/23/2009 -- At the time of this post, engineering was the main focus. Then, other areas become of interest due to overlaps in the problems: map-territory, computation and being, and much more. There will be more integrating posts to bring some cohesion, such as leveraging and fiction.

Modified: 01/17/2013