lunes, octubre 01, 2007

Strategy is NOT Enough to Reach the End-State

As he is not his opinion, Dr. Stephen Lee can easily separate the objective, or strategic side of leadership, from the subjective, or culture side of leadership, as to what affect human behavior in an organization. A few stakeholders are invited to help develop such an organization to reach the End-State of the electricity industry.

Strategy is NOT Enough to Reach the End-State

By José Antonio Vanderhorst-Silverio, Ph.D.
Systemic Consultant: Electricity

Copyright © 2007 José Antonio Vanderhorst-Silverio. All rights reserved. No part of this article may be reproduced or transmitted in any form or by any means, electronic or mechanical, including photocopying and recording, without written permission from José Antonio Vanderhorst-Silverio. Please write to javs@ieee.org to contact the author for any kind of engagement.

To readers interested in the generative dialogue to help reach the End-State of the Electricity industry for quite some time. I will write the general message in a letter to Dr. Stephen Lee, as a comment to his article How Incentives Affect Human Behavior?

Dear Dr. Lee,

With all my respects to you, I think you have an opinion which you should change. I want you to help me find opinions about EWPC that I should change. For your illustration, in the post A Generative Dialogue Without Illusions Part 1, I introduced some of Adam Kahane’s ideas about generative dialogues, which I think will interest you.

You and I can change our “faulty” opinions very easily, by using the generative dialogue principle "you [I] are [am] not your [my] opinion." That is a key principle to help wholes emerge, which I have used to help emerge EWPC.

As for the opinion you should change, according to Peter Koestenbaum, in his book "Leadership: the inner side of greatness," which has help me understand and apply business philosophy, you are perpetrating a "category mistake." He claims there are two realms: objectivity and subjectivity, each with their own languages and logic. That is what differentiates strategy from culture. Please find Koestenbaum’s book and read the section "strategy is not enough," on page 95 in the first edition.

I would say you are very intelligent and important person that have gotten into a non-trivial subject, just like the eminent economist Bill Hogan, that didn’t understand the non-trivial VIUs paradigm (see 2nd Disruptive Technology Crossed Chasm for details).

To develop a culture, all we need is a critical mass of leaders, for which you are certainly a great candidate, to form an organization. EPRI could be one of the best stakeholders, as are Silicon Valley companies interested in electricity, gas and water utilities innovation and the National Association of Manufacturers, to name a few. That organization could be the recipient of the Worldwide Generative Dialogue Funding Sought, which I envisioned two month ago.

These are just hints of what should be emerging to get to the End-State of the electricity industry. As EWPC is the winner of the first phase of the competition, the generative dialogue to reach the End-State could be based on my Carnegie Mellon University Presentation (please hit the last link).

Best regards,

José Antonio Vanderhorst-Silverio, Ph.D.

Slicing the Last of the Regulated Monopolies

The sense of urgency has arrived to introduce competition with a paradigm shift to EWPC and to sliced the last of the regulated monopolies. Enough insights are now available to introduce EWPC and to understand the BIG California LIE, which for more than a decade has led to large worldwide scams.

By José Antonio Vanderhorst-Silverio, Ph.D.

Systemic Consultant: Electricity

Copyright © 2007 José Antonio Vanderhorst-Silverio. All rights reserved. No part of this article may be reproduced or transmitted in any form or by any means, electronic or mechanical, including photocopying and recording, without written permission from José Antonio Vanderhorst-Silverio. Please write to javs@ieee.org to contact the author for any kind of engagement.

"The wires business - the transmission and distribution of electricity - will remain regulated but will be operated by utilities or third parties, with access to the wires open to all...," that was written by Lester P. Silverman, a director of McKinsey & Company, on The New York Times of July 21st, 1996. The title of his article is being reused in this one. He added, "… the energy service business, which involves the packaging of energy and other services, is just getting started."

Mr. Silverman also wrote: "What will the electric power industry look like in about a decade? There will probably be a small number of national scale generators - perhaps a dozen or so -, supplemented by regional and niche players. Many of today’s electric utilities will be little more than regulated wires companies, but some will have grown by acquiring neighboring wires and other operations..."

The last paragraph reads: “Tough choices are ahead. Investors, who have seen electric utilities underperform the market in recent years, have the difficult task of picking winners. Policy makers must sort through the competing interest to balance demands for lower rates with the need to establish rules for effective long term competition… Perhaps the toughest decisions are faced by the utilities as they try to remake themselves. Customers should benefit from lower prices and more options, but how much they do so will depend on how astute their choices are.”

What happened to Mr. Silverman great educated vision?

As readers can see in the post A Vertical Integration Conspiracy Theory for the US Judiciary, I wrote “Fred: my goal seems quixotic to a casual observer. Time will tell. I found my purpose on what has now become the emerging EWPC. I started in 1996 telling others the aim to place the Dominican Republic in the electricity map. However, from 2003 on, I found that there was a conspiracy, not to extend the deregulation scam worldwide, which occurred, but to stop competition altogether to extend the useful life of the inefficient vertical integrated utility, which both of you defend for some unknown reasons.” This is how it goes:

Even though, “The California Public Utilities Commission issued a decision in December 1995 that made it official: the investor-owned electric utility industry in California will be restructured to allow for wholesale and retail competition beginning in 1998,” as it is reported in Barbara R. Barkovich & Dianne V. Hawk, "Charting a new course in California," IEEE Spectrum, July 1996, pp. 28-29.

Barkovich and Hawk, reported something Mr. Silverman didn’t know: "The debate in California has changed remarkably over the past year or two. Discussion now focuses not on whether retail competition or direct access is possible, but on how to make it happen. The three California investor-owned utilities affected by the commission's decision convened an industry working group, called the Western Power Exchange (Wepex) to address the issues related to implementing the new competitive retail market. Its responsibility has included making three filings to FERC by the end of April 1996, seeking [I am copying only the filing to break transmission and distribution, to keep native load and avoid competition]:

• A determination of the dividing line between transmission, over which the FERC has jurisdiction, and distribution, whose regulation is expected to be left to the states ."

… The origin can be traced to Bill Hogan, as … Bill Hogan is the most influential person of deregulation. See Please Blame the Deregulation and Regulation Fiascos Parte 11.

For a more recent account see The BIG California LIE and Conspiracy Theory Against Mr. X

Going back to Mr. Silverman vision, I am adding very recent EWPC articles that should finally slice the last of the regulated monopolies:

"The wires business - the transmission and distribution of electricity - will remain regulated but will be operated by utilities or third parties, with access to the wires open to all... Many of today’s electric utilities will be little more than regulated wires companies, but some will have grown by acquiring neighboring wires and other operations..." is best seen in the articles Free Market and Central Planning, Under R1E2.

“The energy service business, which involves the packaging of energy and other services,” … as it is emerging can be understood from the articles The Sixth Disruptive Technology and Demand Integration Under EWPC.

Except for “… seen electric utilities underperform the market,” the last paragraph reflects the delayed reality under EWPC:

“Tough choices are ahead. Investors … have the difficult task of picking winners. Policy makers must sort through the competing interest to balance demands for lower rates with the need to establish rules for effective long term competition… Perhaps the toughest decisions are faced by the utilities as they try to remake themselves. Customers should benefit from lower prices and more options, but how much they do so will depend on how astute their choices are.” Take a look at Engineers Needed for Lower Prices.