Kindling a Revolution

Just travelled back from Melbourne and sat next to an extremely spry gentleman of 71 years who spent the entire trip reading on his Kindle.

He told me how much he loved this new way of reading. That it can hold 1500 books and he only recharges it infrequently, less than once a month.

As a frequent traveller he enjoys the convenience of his great collection of books in a compact package and at a reasonable price per book. And he’s found that it’s good to read both indoors and outdoors.

I felt quite old-fashioned with a thick book on my lap next to this new-fangled gadget.

As this elderly gentleman said:

“the book industry is in real trouble, it’s not like we’ll stop reading but this will kill the book industry as we know it”

Thus we see again a change in the nature of our media of production is revolutionising existing industries.

We have already seen the changes sweep the music industry. Shifting us from physical objects that we bought and took home to virtual objects that we store on our mobile phones.

Now we are about to see the same kind of revolution sweep through our books.

Even this elderly gentlemen can see this. It will be interesting to see what futile rearguard actions the book industry puts up in resistance to this tide of change.

Why I’m supporting #Febusave

Sound finances give women true freedom of choice, it is the key to giving women options in life.

When @fibendall approached me about supporting the ANZ Bank’s Febusave campaign I was interested because I have first hand experience of the challenges raised by poor money management skills.

I met with the ANZ people and asked why they wanted to run this campaign.  Our conversations revealed how secret and underground women’s financial lives remain. We share openly about relationships and other personal stuff but finances remain a taboo subject. I saw that there was a genuine desire to raise awareness about these issues and to use social channels to reach women. It was clear that if ANZ gets more women customers that is a good byproduct of the campaign. But it was also clear that this was not a direct aim of the campaign. And it was on that basis that I agreed to support it.

I met with Fi & the ANZ team and we talked about the kind of issues I would like to write about.  My focus is on sharing some financial lessons learned over the years. Some of the other bloggers were interested in focusing on different aspects of women and money.  It’s been really helpful to talk with the amazing group of women who are also supporting this campaign. The open sharing of real life experiences by these women is resonating with many people.

This campaign interested me because, while ANZ has clearly identified women as a target customer segment and they have a commercial interest in more women becoming customers, they have also been running their Be Money Confident site for several years. The Febusave campaign combines the social good of breaking a taboo about women talking about and taking action on their finances with the Bank’s goal of raising awareness in a key customer segment.

Febusave is a tool in raising awareness of the importance of good financial health for women. One of the reasons I support this initiative is that it sits under the be money confident banner.

Women face different financial issues to men.  Men are already well served by financial information and spaces to share information. Some key facts about women’s ability to store up financial resources remain:

  • Women have not yet achieved pay equity with men & thus their baseline earning rate is lower over the course of their working lives.
  • Women often have gaps in their key earning years due to time out for childcare, either not working or working part-time, and thus they do not amass sufficient superannuation for old age.
  • Women often undertake elder care responsibilities in their later career, again impacting on full-time workloads and ability to add to their superannuation stores.
  • Almost 50% of marriages fail and in 2006 87% of single parent families are headed  women & the ability of these women to participate in full time work is limited.

My pledge for Febusave is to catch public transport & save the money from not using my car. What are you going to do? Why not go sign up now?

Savings and managing credit – a hard lesson to learn #febusave

coinsWe do not often share stories about our personal finances (except perhaps to boast of some great success?) but here are some hard won lessons I have learned.

My parents were not great savers, subsisting from pay to pay in the way that many workers do. Thus I did not learn much about saving as a child.

By the time I was 21 both parents and all grandparents had passed away and I had lost contact with the few remaining older aunts and uncles. Both of my parents died intestate leaving me to sort out the disposition of their few assets for the benefit of my younger siblings. I was left to look after the family finances, leaving university and geting a job to help support the family.

Settling my parents few debts, arranging for the sale of their house and investing the proceeds for the maintenance of my youngest siblings was done by the Public Trustee.

All went well as I repeated my parent’s habit of living from pay to pay. Then a bank offered me a credit card which I accepted. It was like all my Christmases had come at once and I shopped happily, buying all the clothing and accessories I’d always loved.

I dutifully paid off the minimum balance every month and all remained well. But then I lost my job, laid off due to a downturn, and was only able to find lower paid work. No longer able to afford to pay both my rent and the credit card bill I was in trouble.

How did I get out of this problem?

  1. Borrowed money from friends to pay the rent.
  2. Made a payment agreement with the credit card provider (it took me years to pay that debt off).
  3. Setup a budget and followed it religiously.
  4. Ran my life on cash only for the next five years.
  5. Built up a savings buffer so I did not have to borrow money from friends again.

What did I learn from all of this?

Everybody needs a will – those you leave behind have a hard enough time of it without dealing with intestacy. In Australia the Public Trustee in each State can help you with this (for NSW click here).

Having a household budget is important – knowing your expenses and income & keeping them in balance  reduces stress.

A savings buffer brings peace of mind – a few dollars in the bank for an emergency makes all the difference during stressful times. I found an an automatic savings plan that takes the money right from my pay directly to the bank works best for me.

Parents need to share good financial habits with their children – you will not always be around to help them and it is better for them to learn good financial habits from childhood.

Some more useful information is at Febusave.

Dirty little secret – women and money #febusave

Women share amazing amounts of information with each other – about relationships, family, sex, fashion, friends – often in quite intimate detail.

But one of our remaining taboo areas is money. I can hardly recall any conversations with girlfriends about money and its management.

Recently I was horrified to discover that:

51% of women would last less than three months on their current savings if they lost their job and still had to pay their usual bills

Source: Be Money Confident

The ANZ Bank has launched a new campaign called Febusave via their Be Money Confident site to help women to build a saving habit.

They’ve asked several female bloggers to support the Febusave campaign. And we were all happy to support a good cause like this.

The truth is that money is not what’s important. The important thing is the freedom of choice that money provides. Building up good saving and investing habits gives women choices in life. And it allows us to model good behaviours for the next generation.

I’ve pledged to give up driving to work for Febusave & to bank the savings. What are you going to do?

Why not register now for Febusave?

5 reasons crowdsourcing is stupid

Crowdsourcing is very trendy these days and is touted as the answer to many of the ills of poor design and the need to reduce costs. In these cash strapped days any way to make innovation better-cheaper-faster is extremely desirable.

But crowdsourcing is just one of the many tools we have at our disposal, and each tool is suited to particular kinds of applications. To simply adopt an idea like this without considering its suitability to the problem domain or to the desired results can be risky.

To assist with critical thinking about crowdsourcing I have collected a few alternative viewpoints & list five reasons why it might not always be the best approach to adopt. Please note I do not agree with everything in the articles linked below – they are meant as a thought starter & to provide different perspectives on crowdsourcing (i.e. if you’ve got any issues with the articles please contact the author directly).

Since no single tool is the answer in all cases, here are a few times when crowdsourcing might not be the right solution:

1. When the crowd does not have sufficient understanding or knowledge

For crowdsourcing to work you need to find the right crowd.  If the technical or scientific knowledge required is rare then crowdsourcing might not be helpful unless you can find a crowd of people with the requisite foundational knowledge.

2. Where the problem is diffuse and complex

Crowdsourcing lends itself to solving clearly focused problems where there is little ambiguity or nuance – a great recent example of this was the DARPA balloon challenge.

For diffuse and complex problems it might be necessary to chunk up the challenge (if that is possible). And for problems that require painstaking layering of knowledge and information with long term focus it might not be commercially viable.

A good example of this is the discovery of longitude via crowdsourcing in the 18th century. It worked in the long run, but it took a really long time and was funded by the government. However, it might be argued that this kind of discovery would be much quicker today with computer power.

3. When you want to keep your plans secret

Clearly secrecy requires that only a few people know the secret. Thus crowdsourcing something that is meant to be a secret is probably a bad idea (unless you are executing a cunning hide in plain sight sort of plan).

4. Your problem needs to be compelling enough for contributors to care

Experience of Wikipedia indicates that people will contribute to things that are interesting to them. Thus if nobody cares about solving your problem then crowdsourcing might not be the answer.

To get an idea of how crowdsourcing works on an everyday basis there is a good discussion of how Wikipedia contributions happen by Henry Blodget in: Who The Hell Writes Wikipedia, Anyway?.

There is also a well known report by Forrester about Social Technographics that segments the participation of people within social networks. It shows that only a small proportion of people create or share content, a few active creators or editors, with the bulk of people lurking or not participating at all.

5. Crowdsourcing for complex problems requires dedicated resources

To undertake the kind of knowledge work required to solve complex problems contributors need uninterrupted time in the zone.

This is exemplified in some of the large open source software projects where companies pay people to work full time on open source projects for commercial advantage:

Many of the leaders of key projects (like Guido van Rossum, the inventor of Python, who works at Google (nasdaq: GOOG – news – people )) are paid by their employers to continue to lead their projects. Is there an open source community? Of course there is. But on the most prominent projects, the members of the community have jobs and are paid to work on open source because the software is so beneficial to their employers, even though it is not owned by them. True, there are hybrid models, and the smaller the project, the more likely it is unfunded. But when it becomes a big deal, open source becomes commercial.