For the Week of August 23, 2004

The secret to success is obligation.

Every great company is based on obligation. IBM was built on the rigid episcopalianism (that's not a contradiction) of Thomas Watson Sr. Salesmen wore suits, meetings were alcohol-free, and everyone was expected to be of service to their communities. There were two reasons for this. First it helped the corporate image. Second, it reinforced corporate values. Climbing the IBM hierarchy has always meant fulfilling obligations to the company, to your bosses and, in time, to those below. Serving your community is great training for the latter.

All great companies are the same way. The genius of Wal-Mart lay in how Sam Walton built this same IBM-like sense of mutual obligation in his employees. This was especially amazing because they weren't highly skilled salesmen of business equipment, but low-wage retail shift workers. But they were also "associates," and to Mr. Sam this made them, practically, partners. There was a sense of obligation shared from the boardroom right down to the floor greeter, and by everyone in between.

Companies, like civilizations, often fail when obligation is replaced by entitlement. That's why our time feels like the 1960s. Enron and Tyco and Adelphia and all the rest were corporate love-ins, rolling Woodstocks of entitlement. Dennis Kozlowski's corporate bank account became a form of heroin. Each scumbag who got away with anything became a middle-aged hippie, devoted only to himself and to heck with anyone else. Employees, shareholders, the government - who are they?

One reason I suspect the U.S. economy has performed better under Democrats than Republicans has to do with these ideas of obligation and entitlement. Income tax is an obligation to the state, one that can be partly offset by fulfilling obligations within the community. Arguments against it are all based on entitlement. What's the slogan? It's your money.

The great corruption of men like Richard Mellon Scaife has been how they twisted the obligation of public service, spending huge sums to protect and extend their entitlement to money, and power, their right to rule and to pass on that rule to succeeding generations. If George W. Bush seems addled remember that he's the fourth generation of inherited power in his line. This did the Stuarts of England no more good than it's done W. Skill doesn't follow entitlement. Skill comes from fulfilling obligations.

In my career I have met many, many entrepreneurs, and what marks the successful ones is always a real sense of obligation. (This is true for those who inherit their power as well...see Queen Victoria.) Bill Gates feels the need to recycle his wealth because he feels the obligation of that wealth. If he felt entitled to it his kids might someday rule the world. But I doubt they would rule it wisely.

This sense of obligation is the key to personal fulfillment as well (which is another reason why Watson Sr. mandated it). Corporations work because they are chosen obligations. The best are run by men (and women) who are committed to ideals. Some of these ideals may seem silly to outsiders (Coke isn't that much different from Pepsi), but out of such allegiances great teams are made. The same can also be true of Universities. I may seem flip when I talk about the obligation I feel toward my alma mater , but I work hard at my writing every day to be a credit to my Rice. I am obliged for my education. It was more than I was entitled to.

Military service forces those who serve into a mutual obligation built of iron and sweat. It's something that I'm constantly told "civilians" don't understand. But there are also professions like cops and firemen, and the best teachers (like my brother) share this sense of obligation, to their students and their profession.

Of course any obligation that is forced upon you has another name, servitude. But a life without obligation is empty, aimless, often unhappy, usually short. Commitment - to the job, to the company, to the family, to the church, to the nation, to the corps, to the old school - voluntary commitment is the source of true success. Voluntary commitment is the result of feeling, and acting upon, your obligations.

So this week's Clue is very important to your business, whether you're making a product or a service. The sense of obligation that brings commitment - that's what you must have, and that's what everyone who works with you must have.

The best way to create it is to give everyone who works with you a stake in your corporate success. And not just your future success, or your present success, but in your struggles as well. Morale within small companies is often much higher than in big companies because both struggle and reward are so tangible. Make it tangible. Use that to your advantage.

Let the sense of mutual obligation, and shared voluntary commitment, be your secret weapon. Use it at work, use it in life, and your success is guaranteed.

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Shameless Self-Promotion

I work as a freelance writer in Atlanta, and am on the development team for EgoScout , a new kind of marketplace for cellular data services.

My last book, "The Blankenhorn Effect" won the Computer/Internet category in the 2003 Independent Publisher (IPPY) awards .

You have my permission to forward this newsletter widely. And if you have trouble subscribing let me know. Remember: it's journalism that keeps the Clues coming...

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Shameless Promotion

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Takes on the News

Hotspots Want To Be Free

Internet Week recently featured two profiles on 802.11 hotspot business models.

One was from SBC, which wants to broaden network coverage in order to make it valuable. . The other, from Panera Bread, is to give away the service and sell more pastry.

There are two ways to think of the 802.11 user. There is the opportunistic individual, and there's the enterprise customer.

The opportunistic individual has a Wi-Fi client, which he (or she) will use when connections are available and the laptop is open. This person might pay for service at an airport, but they are highly price-elastic -- they will reject the service if it costs a lot or it's difficult to pay for.

The enterprise customer has an office connection they're anxious to stay in touch with. It is assumed that they are price-inelastic, that their need for a fast connection is constant and paramount.

I believe this person exists only on TV, and in the fevered imagination of hotspot salespeople.

The enterprise customer, if they exist, will compare the price of connecting to the office via a hotspot with the incremental value created by that connection. They will leave the office with a cellular phone, and maintain that as their primary connection to the office because it works everywhere.

In other words, they will be opportunistic. Thus, Panera's is the way to go. Even if some people have cellular contracts and use 802.11 as an adjunct to their cellular phones (as T-Mobile hopes) you're still talking about a business model which gives away the WiFi to sell something else, in this case cellular.

Connectivity is not service. A connection, in and of itself, means nothing. The only thing that's meaningful is what you do with the connection. And that revenue can be collected at the server, with the network as intermediary.

The hotspot business, in other words, is worth about one doughnut (or sticky bun) plus one cup of coffee per hour. (And considering that I seldom get out of Panera for less than $4, that's not bad.)

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The Cellular Interface

Last week, as readers of my blog may recall I spent some time dumping on the new Danger box. I have also been working with documentation from a wide variety of today's cell phones.

What I have learned is that today's phones have a wide list of options, in terms of what they're going to be. These include:

• A camera
• A tape recorder
• An office device
• An entertainment device

Oh, did I mention it's also supposed to be a phone?

Plus you've got to get all this into a form factor that will fit easily into a pocket, and hopefully have the price point so low the carrier can give it away with a service contract.

Not easy.

Most phone makers start with the phone first. The circular control key or navigation key has become fairly standard. So have the hook and off-hook buttons (sometimes they're colored red and green), a couple of soft keys, and (why not) some extra programmability where the Bell System thoughtfully put the * and # symbols (known as star and pound).

With some dexterity (the kind your average 15 year hold has, and your average 50 year old sometimes thinks she has) you can get those 17 buttons to do a lot. (Nokia likes to combine them - some of their models now look like they have just 9 buttons, since you can press most of them on one edge or the other.)

Then we have the screen. What are you going to do with all that "real estate?"

What most phone makers do with the screen is to fill the top of it (and sometimes the bottom of it) with icons, much as a TV screen today is sub-divided with "bugs," "crawls," and network logos. (You know how you can tell today when a commercial is on? That logo disappears.) It's amazing how complex, and how tiny, these little icons can be made. Forget using most phones today if you're over 40 and too proud for bifocals.

With this, most phone makers can sneak a rudimentary camera, a recording device, a phone list, MMS and SMS messaging, maybe even a WAP browser onto a device, without breaking the size and price requirements (real small, real cheap) we mentioned before. (Why are flip phones so powerful? Because the flip covers the buttons, while hiding the screen when the phone isn't being used.)

It's at this point that two paths diverge in the woods.

The true cell phone makers won't break their dimensional box, won't violate their price rules, and (since phones are written with one-time-only operating systems like Symbian) won't change their proprietary interfaces Some carriers (notably Sprint) have done a little work with voice commands , but it's basically a server-based system. You have the phone call their server and you can store some commands for later activation. Cute, gimmickry, and pricey.

If you want to go further you're going to PDA-land.

Once you arrive in PDA land you've got something resembling a computer operating system (Palm or Windows ), you've got a bigger screen, you've got true office functionality, and you have some options.

• How about a pen-stylus? (Of course)
• How about a keyboard? (Maybe) With a QWERTY lay-out? (OK) That I can type on? (Are you MAD?)
• Bluetooth? Infrared? (Maybe)
• External head set? (This thing is starting to get thick-as-a-brick, yeah we'd better)

You can see where we're going with this. Now I'm looking for options, options that today don't come in a single box. I got a bad case of the I Wannas...

• Why can't you have a cell phone that's also a Gameboy?
• Why not have a cell phone that's also a real iPod?
• Why not have an iPod that's an office machine and a phone?
• Howsa bout some components? Y'know, plug that game machine in the bottom for when you're in the plane. Plug in the office for when you're there. Plug in the iPod for when you're in your own little space and just need to, like, chill.

One thing more. (OK, two things.) Let's not forget Moore's Law and let's not forget broadband. Moore's Law means power, in any one of these directions, without sacrificing price or size. (But how will you interface with it?) Broadband - 3G, 4G, 802.11 - means even more functionality becomes open to you. (But where are you going to put it?)

And that's where we are. Of all the devices I've seen so far, I really like the Hitachi G1000 . That's a nice little PDA with plenty of cell phone and Internet built-in, plus a camera, plus the stylus, so you can put the commands on the screen and I can see 'em. Plus a keyboard, because my handwriting sucks. Expandable, too.

But even this is far from perfect. I really want an external keyboard. I'd like an iPod, and why should I buy a second machine? My son, who's going to be in an office job before-you-know-it, is going to insist on gaming functionality.

So let me finish here with some hoped-for ground rules:

• Open systems
• Work on voice interfaces, real ones, inside the phone
• Think components, starting with an infrared keyboard . To save space let's have the infrared display on a tabletop so I don't have to carry the thing.
• Combine functions.

Combination platforms, built from components, that I can mix-and-match to suit where I am...that's the ticket.

Police State USA?

Neil Munro of the National Journal decided to chide the journalists and opinion leaders who make up Dave Farber's Interesting People list.

"Your people are growing increasingly worried about a 'police state,'" he wrote. "For such an educated audience, they seem to lack any sense of proportion, a sense of history or an awareness of human nature." He then went on to mention real police states - North Korea, Cuba, Iraq under Saddam. Surely our worries are an insult to those victims.

Naturally enough, Munro was hammered by the group. My own response wasn't published. Here it is:

Dave:

I agree.

I don't think this is anything like a police state. But I detect in Neil's note a frightening complacency.

America has had many periods like this one in its history. There was McCarthyism, sure. But the "Red Scare" of the 1920s shouldn't be forgotten, either. Nor should the police riots against labor in the 1890s, the original "filibusters" of the 1840s, even John Adams' "Alien & Sedition Act." America has often failed to live up to its promises. And Neil's right. We've always come back from it.

Whenever middle-class Americans have been frightened in the past there was the strong temptation to go further. Our mainstream government hasn't, yet. Neil is certain, absolutely certain, that we won't this time.

But we didn't step back then because good men and women did nothing. Never forget that sometimes that's what they did, nothing.

Any of my black neighbors, man or woman, would be quick to tell Neil that the American South, from the 1890s through the Civil Rights era, was a very selective police state, for African-Americans, with all the horrors he describes as non-existent.

My first neighbor when I came to Atlanta was a black man, born in 1883. I read Neil's note and wondered what my friend's reaction might be.

Consider the situation for a northern white man of Neil's age, say in Dayton, Ohio, on a lazy Sunday afternoon in 1903 (to quote an old song). Did he hear Mississippi? No. Not then, not for the rest of his life. Maybe he admired the words of Booker T. Washington, thought W.E.B. DuBois too radical and belligerant.

But didn't the Klan ride afterward, for decade-after-decade. How many were lynched, how many murdered? And the police of those towns, those states, the government -- what did it do?

Evil happens when good men do nothing. It continues until good men do something.

So yes, Neil, liberals today seem a little paranoid, almost lunatic.

But we're patriots. We see wrong and try to right it, see suffering and try to heal it, see war and try to stop it.

The only way America can move forward, the only way America has ever moved forward, is when injustice comes and people cry "enough." Yes, it's a messy parade, and some people say some very impolitic things. The rhetoric grows harsh, and heated. It's messy, it can even sound ugly.

But we will all be called to account one day, for how we acted on this day. Going back to that lazy afternoon in Ohio I'm reminded of a quote that came much later from Robert Kennedy, from whose eulogy I quoted earlier.

"Few will have the greatness to bend history itself; but each of us can work to change a small portion of events, and in the total; of all those acts will be written the history of this generation."

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Clued-in, Clueless

Clued-in are the guys at Space Transport Corp. who, failing in the launch of their Xprize entrant Rubicon, put the pieces on sale at eBay.

Clueless was Ojum.Com , which stuck a DRM scheme onto its cellular game and thus created the first cellular virus.

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