Making the world flatter

“The world is flat” was a book and an idea presented by Thomas Friedman in 2005. The concept of the flat world means that globalization has changed our world economics drastically by creating international and even intercontinental supply and support chains. Global competition between companies, teams and even people has made many things cheaper, ideas and innovation travel faster, but it has also caused jobs to move and the environment to suffer from consumption, logistics and travelling.

But how flat is the world really? Is it flatter in some parts of the world? How is the situation in the Nordics and Baltics? Here is my perspective to it and I hope to bring it some insight from my experience of moving on an international assignment from Tallinn to Stockholm.

Why a multi-national company should move people?
The reason is pretty obvious. This is the best way to get people to work together and share ideas and experiences. Videoconferences, telephone meetings and visits do help, but especially when starting successful co-operation you need to have the team in one room for some time. Othervise the problems of different goals, interests, language will not be solved and the co-operation just does not start.

How flat is the Nordic and Baltic area?
The world is much less flat in the Nordic and Baltic countries than it is in UK and in the USA. In the year 2009 2,2% of Americans moved from one US state to another. If we compare EU member states to US states then we can see that the number of people emigrating or immigrating to Sweden was 1,52% of the population. For Finland it was 0,73% and for Estonia only 0,64%. So we can say that the Nordic countries are in a world that is 30% to 70% "less flat" than the US.

And there are numerous reasons why the Nordic world is less flat
As a recent mover I can point out many things that make moving and communicating in the Nordics more difficult than it would be in USA.

The language – this is of course the most important difference between Europe and USA or the English speaking world in general. Although most of the communication can be done in English and many people in Sweden, are very good in English, then sooner or later you run into situations where the local language is of great importance. For example if you need to know detailed rules of registering your car or details of tax system or find a good local grocery shop on the internet or buy a ticket for the bus. This is the time when Google Translate becomes your best friend really fast. It usually are the difficult and crisis situations where you need the local language the most. Like an announcment of a traffic stop on Tunnelbana or the neighbours repairing the piping and shutting down your water.

The culture – Different nations have different pop-stars, sportsmen, history and it is only polite that you get to know them. But besides such fact knowledge you need to understand the subtle ways people interact. Does “Yes, but…” mean actually “No”? If a person is just sitting silent then is he “aggressively planning something” or is he just “a calm person”?

The school system – This is a real challenge if you move with your family. Are the lessons the same? Is the level of lessons different? Can you later move back or move forward and how much caching up needs to be done then? Here again the language as a challenge comes in.

The administrative stuff – The taxes are different, the socialcare systems are different. Thank God we have EU that makes cross-border moving much easier, but still there are many things you have to arrange and they cost and take time. My experience has been that you should plan at least 2+2 months for arranging everything. 2 months for closing and preparing in your previous home and 2 months opening and registering everything in your new home. Tax department, appartments, mobile phones, bank-accounts, hobbies, TV subscriptions, packing-unpacking....it really is something.

My final two thoughts would be, that although difficult, then moving from country to country is worthwhile. It is really interesting and you do learn a lot! The other eternal truth is that the less stuff you have the better! So if you are thinking of visiting a shopping centre this weekend...then try not to. :-)

3 Estonian IT innovations from December

E-services are among the most important sources of economical efficiency. In Estonia 3 small, but innovative e-steps were taken in December. Here is a small summary of them.

Firstly of course the population and housing census! The census will take place between 31.12.2011-31.03.2012 and hopefully all the inhabitants and housing of Estonia will be counted. During January it is possible to participate on the E-census and "count" your family and household through the Internet. This is of course much more efficient than having the interviewer visiting your home. By now over 190 000 people have been enumerated. That is approximately 13,5% of the population. The goal is to count more than half of the population over internet. One can follow the status of the census (and count yourself if you are an inhabitant of Estonia) here http://www.stat.ee/phc2011.
I participated on the e-census and it worked fine. Although there were a lot of questions, I was happy that I could answer them over the Internet and did not have to find a suitable time for the interviewer to visit us and spend over 30 minutes interviewing us.

The second interesting e-innovation whose pilot started in December was the installation of payment terminals to police vehicles. So now if you get cought braking the trafic rules you can pay the fine at the police car. Well I do hope that you or I will never have to use that service, but still it is better to suffer your punishment without too much hassle. (Just as a remark for foreign readers - you cannot pay in cash to the police and the Estonian police really don't take bribes. It is better not to offer.)

Thirdly, the Estonian Forestry sector took a major step towards bigger efficiency and the active use of e-waybill system started. We at Elion are operating the service and the last months have been really busy with the integrations and contracts. Now the system is in use and hopefully will bring efficiency to the transportation of wood by making information available for the transport and timber companies.

Call for developers

We in Elion are planning to develop a new SaaS service that will involve functionality like webmail, contacts etc. We are looking for a software developing company that would create the service. If you are interested then please let me know (mart.ridala@elion.ee) and I will give you more details.

The platform is LAMP. We prefer agile approach of development.

The project plan is:
- We will send the RFP out in the end of November
- Proposals should be ready 14.12
- Selection of the developer by the end of December
- Development of the first version January-April 2012.

Write me if you are interested!

Nationalism, religion, team spirit, the EU, business mergers

This post was inspired by Henry Kissingers "On China", The European Union and the mergers of teams that I have been involved.

All through history armies fighting for a nation, religion, their homeland or their way of life have proved to be many times stronger than the armies of mercenaries. The same is true for team spirit in an organization. (Religious) belief in what we do and having a greater meaning in ones job surely helps to perform better. So creating team spirit, a vision, a mission, symbols, rituals and belief would be the right thing to do. Both for a team, a company, a nation or a state. Or would it?

On the other hand one could argue that if people were less religious and less nationalistic there would be less wars. Strangely enough most of the wars are fought over ideology and not over money or natural resources. War is a somewhat extreme example, but more cosmopolitan people and nations do get along better with each other. How this phenomena reflects to businesses is that more open minded companies build alliances easier, outsource better and are better in open innovation. So there are huge benefits in not building a strong team spirit. Not teaching the national anthem at schools, but teaching that all people are good and interesting. The pupils would be open minded, friendly and would .... never work long hours unless paid, because what would be the point of that?

One of the best illustrations of the problem is a merger. If two companies with strong identities and history are merged then the identities become a serious obstacle. People do not give up their beliefs easily and the emotional side of a merger is always difficult to handle. But imagine the magnitude of this problem when a merger of nations is needed! Like for example we currently need to do in Europe. This is because open markets->aligned tax policy->aligned policy->centralization of power.... and well... if you need motivated people under the new rule then you must build up a common team spirit. A European spirit!

I end this thought by some intrigueing questions:
- Do national football teams play better than club teams?
- In order to build up the European nation shouldn't we have a European basketball team? We could perhaps beat the USA?
- Is there any economical reason not to educate your children in English?

The ultimate employee and a citizen would be one whose passion about the company and state could be turned off and on and also switched from one to another. For example a person who was a purely atheist estonian believing in free phonecalls making the world better. Then had his passion switched off for a year. And finally switch himself to a church going Christian american believing that making money off the corporate market is a Gods gift that one should pursue with total determination.

The amazing speed of Facebook's development!

In July I wrote a bold prediction that Google+ will soon be more popular than Facebook. I have been following the popularity contest ever since. According to Alexa last week about 3,1% of Internet users visited G+ and 43,4% visited Facebook. The number of G+ visitors has increased since it opened up to the public, but not very fast. The number of Facebook visitors has remained stabile.

But what I want to write about is the amazing speed of Facebook's reaction to Google+'s launch and how fast FB has built new functionality ever since! I have been working in different product development organizations and must say, that this speed is truly impressive for an organization with 2000+ employees like FB currently is. Probably most of the startup community don't understand my excitement, but I will illustrate the phenomena with some of the issues a big product development organization has to cope with:

Firstly, if you have a democratic organization with specialists who put their souls into their work, then all the employees have a very passionate opinion. Agreeing on what and how to do gets slower and slower the more people you involve in the decision. So in the end it may take weeks or months to agree on a proposed change.
An authoritarian organization on the other hand can make changes fast. Such organizations however have other kind of problems as most skilled specialists don't like the "Maul halten und weiter dienen" culture and leave. We can be pretty sure that FB is not such an organization.

If you have 500 million daily users then shouldn't you do an analysis before doing even the smallest change in the user interface? FB most certainly did major changes in the interface and functionality. Did they do a study before starting to develop them? Well looking on how fast the changes were developed then I doubt that there was time for any analysis.
But if you skip user studies and don't implement objective decision methodology then who decides what and how you develop? The CEO? The engineer with the most authority? So here you also run to problem number one.

Then you have the development cycle and roadmaps. These are useful measures that are in place to ensure technical quality on and avoid key developers from burning out. Changing the plans is costly, takes management decisions and re-location of resources. Do you want the moments when a boss walks into the office and tells the hundreds of developers: "Drop everything you are working on and here is the new featurelist that we copied from Google+"? You get responses like:
- "Again?"
- "We just agreed on the plans last week?"
- "This is the third new strategy this month, maybe I'll just wait and do nothing until the next one?"

Then there are of course administrative constraints. For example if you need to suddenly triple your development budget for July and August then it might be a challenge.

But one thing always helps! A common "enemy", be it a competitor, a new big customer or the threat of bankrupcy. The mutual challenge always mobilizes the whole team to stand as one. Google+ most certainly is this one big enemy for FB.

Arctic15 enterpreneurs and the non-IT industries

I had the privilege to attend the Arctic15 conference in Helsinki yesterday. It was a great event and I would like the organizers from Arctic Startup for organizing it and getting so many interesting presenters together. I think we have a great startup movement going on in the Nordic and Baltic region.

Looking at the finalists and presenters it seems to me that there is one important thing that the startup community should now focus on! It is time to take the next step. It is time to focus more on solutions that help the non-IT economy. Currently we have many startups creating economically rather irrelevant services like solutions for publishing posts on Twitter, LinkedIN and Facebook simultaneously, social networks running on other social networks, all kinds of games and so on. We should consider this as the training that has refined the skills of the specialists and now start serious work.

The real value IT can create is not in the IT or internet sector. It is in making the non-IT economy running in a modern and efficient way. How about a startup that would change the way how milk gets from the cow to the shop? Or a solution that organizes the global container logistics? Maybe something that helps to save 5% of some industries energy consumption? This is where serious effects and money can be made.

We have some experience in operating SaaS solutions for non-IT sector from the E-waybill and the Promoter Index service. Our experience shows that the startup methodologies for product development, organization management and marketing work. These are all great ways of working and managing product development.

On the other hand creating IT services for other industries is very inter-disciplinary – you have to know about the sector and business you are working on. This makes it really hard for the current startup folks. We just don’t know how other industries are run and we don’t know the people. Everybody knows who runs Facebook, but name the CEO of Nike, Danone, Pfizer or Mitsubishi for example?

What this inter-disciplinaryness also means is that “the other industry” is light-years behind the startup folks in their use of IT and Internet. There are still systems running on mainframes and many companies rely on Excel sheets as “their most important database”. Shared calendars would be an innovation for many SME-s.

To solve this inter-distciplinary problem we have to come together with the specialists from other fields of economy. An interesting example of breaking this barrier that I met on Arctic15 is Vendep Oy. They are offering software development for entrepreneurs for share in the business. This model does help the non-IT specialists to turn to IT and create an IT/Internet solution for the field they work in. When we were running the MicroLink Incubator we had a similar idea and that did bring many non-IT entrepreneurs with their ideas to our office.

It is time to take the next step in the Internet startup field and head on to making “the other” industries also modern and efficient! As an example Arctic15 was the first digital-native-friendly conference I ever visited! There was Wifi that really worked and power inlets for the laptops! A similar step to modern age needs to be done in other industries.

Positive economic news (from Estonia)

The global economic situation has been gloomy in the last months and the newspapers are full of economic misery coming mostly from Greece and Italy. But things are not all bad! In Estonia we have had many great economic developments overall and especially in the IT and technology sector lately. Here is a list of some of them:

The Seedcamp event in London was overwhelmed by "the Estonian Maffia", with 4 out of 20 participants and 2 out of 3 winners coming from Estonia.

Fortumo, the mobile payment provider, was selected as the best Estonian company by Enteprise Estonia. This marks a significant shift of focus to young and innovative startups by the society and government.

The delegation from Brussels is looking for premises for the European IT agency in Tallinn. We hope to have many European IT specialists and decision makers moving to Tallinn. (Tallinn is a nice town with a pretty Old Town so why not.)

Flybe, Utair and Estonian Air have opened many new flightroutes to and from Tallinn. Copterline will start flying between Helsinki and Tallinn again offering commercial helicopter trips lasting less than 18 minutes. They also plan to start flying to St.Petersburg. That combined with Ryanair opening 8 routes from Tallinn is slowly, but surely making it easier to travel here and back.

A character called Viktor Kaasik was convicted for corruption proving again that Estonia has effective measures for fighting corruption.

Estonian annual industrial output growth (23%) was the biggest in EU (3,6%) in july. The production and exports of electricity grew 50%. The production of electricity from renewable sources increased 100% from 2009-2010.

The increase in Finnish alcohol tax and the mess with the major Latvian airline Air Baltic will surely increase the number of tourists both visiting Estonia or flying through Tallinn. :-)