Eric Veldkamp is managing director van het Nederlandse bedrijf Dynamics Software. HIj blogt in het Engels, dat we onverkort hier plaatsen.
If you need to write something in November there are a lot of interesting topics to write about. You can write about year progressing, what to expect the coming years, about events, trends, cloud, Internet of Things, Machine Learning, new product releases and much, much more. But if you are in the software business there is certainly 1 topic which you should touch and that is Sjoemelsoftware.
One of Satya Nadella's statements I like most is the one he mentioned at Convergence US earlier this year "Every business will become a software business" and that is 100% true. This is a quote made as part of his speech on business transformation, disruption and how the Internet of Things will drive to change business models. He meant business models and software business in a good way, not the change of business model in a bad business. Even in a good business there is the risk of using software in a bad way.
Sjoemelsoftware is the Dutch word used for the Volkswagen emission scandal which headlines the financial news since September 18, 2015. Other headlines used are Emission Scandal, Dieselgate, Diesel Dupe, Defeat Devices or Diesel Deception. The English translation for the word sjoemel is fiddle, cheat or chisel which would make it fiddleware, cheatware or chiselware. Which do you like most?
The Environmental Protection Agency (EPA) discovered that VW cars being sold in America had devices in diesel engines that could detect when they were being tested for emission results. These devices changed the performance accordingly to improve results. The German car giant has immediately admitted cheating emissions tests in the US. VW wanted to seriously increase Diesel car sales in US and that was backed by a huge marketing campaign trumpeting its cars' low emissions. VW has admitted that about 11 million cars worldwide, including eight million in Europe, are fitted with the "defeat device". But it is not the device, it is the software that could sense test scenarios by monitoring speed, engine operation, air pressure and even the position of the steering wheel.
If I remember well it was one of the VW top managers who mentioned it being the fault of IT specialists. Yes, of course.
Another top manager responded that VW has broken trust of customers and public. Yes, indeed.
The financial impact of the recall, fixing the cars, fines, claims etc. will be huge, multiple billions of dollars. The impact of losing trust after fraudulent behavior is undefined yet and can lead to ruining the company. I have seen that before being a former Baan employee and there are many predecessors like Enron, World online, etc.
In Holland we say that trust comes by foot and is leaving by horse. In this case multiple horsepower. If this scandal is spreading on to other car manufacturers (and the rumors say so) it can be VW's lifesaver as they are then all in the same boat and of course we want to continue driving. VW car sales in Netherlands is not suffering yet, October 2015 showed VW as best sold car manufacturer. Isn't it typical that a US based organization is publishing this scandal? Being often in the US, I think most US cars have much higher emission rates than a VW without defeat devices. But that is not the topic.
Why did VW do this? It is part of the strategy to become the biggest car sales company in the world beating Toyota and staying number 1. And as part of that strategy apparently everything was allowed. Isn't that amazing?
Microsoft's strategy is to become number one in all the segments they play in as well. Is everything allowed? Microsoft is about to reach another significant milestone which is the release of Microsoft Dynamics AX, version 7. It is their first ERP system from the cloud running on azure in public cloud. Customers can benefit from this innovation and only pay per use. Will there be devices in Azure or AX cheating the real use figures? It is all about trust, the cloud adaptation is about trust. Do you trust Microsoft? Microsoft is doing everything to be trusted. They are transparent with their data centers. Have you ever wanted to see a Microsoft Data Center from inside? Welcome to the Microsoft Datacenter Tour in Dublin!
In my April 2015 blog I wrote about the Internet of Things (IoT) and the impact it can make in the industries we provide solutions for (Service, Maintenance and Rental). IDC, Gartner, Forrester, McKinsey and many others predict a connected world with billions of sensors in as many devices whether it is your house, your fridge, equipment you rent, your car, or a cow.
Do you know where the highest milk production per cow is realized? It is Israel. The Bible, no less, describes Israel as a land flowing with milk and honey. In that respect, it's been proven at least half-right: Israel has by far the most productive dairy cows in the world. Bloomberg's Middle East Editor Elliott Gotkine has been finding out why. (Source: Bloomberg)
Imagine only a small percentage of these devices contains sjoemelsoftware! Which industry is next with sjoemelsoftware? Japanese refrigerators were already suspect of having sjoemelsoftware faking energy usage consumption during tests many years ago. The real consumption was 3 times higher than the usage during these tests. Panasonic refrigerators turned off unessential functions like ventilation and heating while being tested. The tests have improved since then, but there are still concerns on the energy consumption data from the manufacturers and energy labels their equipment gets. Also the testing methodology itself, similar to the emission tests, is being criticized.
The tests are only done with the doors closed, empty compartments and an environmental temperature of 25 degrees Celsius. I don't know how you do it, but when I completed my 00.01 mile run to the fridge yesterday without Runkeeper (:-)) to open a bottle of beer I had to open the door first!
The energy consumption of fridges is dependent on temperature of the room the fridge is in, the internal thermostat, and the temperature of the stuff put in the fridge. But more importantly (and again in parallel with car emission) how it is being used by the user. 1 out of 6 French consumers put hot food in the fridge before letting it cool down outside the fridge and average thermostat in the UK and Spain (between 0 and 12 degrees Celsius) is much lower than in Germany and France. And this is a big business, the manufacturers want us to believe it is better to replace an 8 year old fridge as it will save you money as energy consumption is lower.
While our software may have ocasional programming errors in it, I can guarantee that it is absolutely sjoemel free. Integrity is one of our standards and we enjoy co-creating good software with our customers. Sometimes we receive interesting enhancement requests though. We were once asked by one of our food customers whether we could change an invoice after the payment was received. The integrity alarm bells immediately started to ring and we had to refuse this enhancement request. I am sure they found other ways to realize what they wanted. The company still exist, no scandals in public so far.
More inspiring was my recent visit to one of our customers Priva,. A truly inspiring customer in providing sustainable living solutions in both horticulture and building automation. With the urbanization trend continuing, Priva anticipates on the need for food growing environments in larger city deltas like Beijing. Watch some of their projects in the links below.
I am proud that we contribute to their success with our Dynamics Service & Dynamics ERP Productivity Solutions:
The horticulture and agriculture industries show a lot of interesting innovation. Recently a new stable style has been introduced in the Netherlands: the cow garden
It is a stable with open space and lots of green where the cows can decide themselves to go inside or outside, when to be milked (milk robot), what to eat (presented individually by a feeding robot which recognizes the cow) and where to drop their stool (robots clean it up immediately).
The stable is situated next to the holiday rental homes of the multi-disciplined entrepreneur. It is the next step in reducing emission rates of the agriculture industry with the same level of costs per cow. The fermented fertilization is sold to biological horticulture farmers in the area.
As mentioned before, Microsoft will release their next piece of innovation i.e. Dynamics AX 7 early 2016 running from the cloud. Does the cloud exist? It is actually someone else's computer in Microsoft's data centers and as you know data centers are using a lot of energy. It is good to hear Microsoft's data centers are optimized to reduce the impact on the climate. It is all about trust.