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On Being independent and Bias free

One of the core values I had for Percona is providing indepentent/bias free services for the customers focusing on just their needs and benefits and avoiding the things which would stop this from happening.  As I was thinking about this matter over the years I see there are number of things which forms the bias or breaks tru independense and some are harder to deal with than overs.

Product Sales – if you own the product you’re doing consulting around it is very hard to be independent. It would take a lot of guts for consultant to go out there and say the competitor product would work better for the customer and it takes a lot of leadership to ensure  such opinions can be exposed without putting the job at risk.  At Percona we’re in good position about this one because we made a choice not to sell any products – all software we develop is freely available and we do not have any direct insensitive to push our software to be deployed.  True we think it does provide value and improves effectiveness in many cases but it is not the same thing.

Partnership Commissions –  Another insensitive company may have is to push product or services by the partners earning comission on the deal.   In this case it is similar to Product Sales issue  as there is a motivation to recommend partners which pay highest commission  and avoid solutions which do not pay any.     This is harder one to solve.     If we simply to refer the customer  to someone we do not want any comission on this. If someone would like to give a token of appreciation to Percona we would rather see in form of  discount to our customer.  We’re paid for bias free recomendation of best solution for the client and this is what we do.     If however customer wants to work with Partner through Percona we have to charge certain fair margin to keep operations running.  If we subcontract we’re exposed to legal risks,  financial risks of failing to get the payment from the customer and quality risk, potentially being forced to seek solutions at our cost for mediocree work partner has done.      We try to structure our deals in this case to ensure we fairly share revenue with partner and so we have limited insensitive choosing one partner over another.   Of course relationships does matter in this case  – if some partner does a great job performing some task he naturaly becomes preferrable.

Personal Preferences – Here is another hard one.  Personal preferences.  There are people who love Linux others love FreeBSD – they know one better and would be naturally biased towards that.  Everyone has their individual experience which leans us way or another.  The only solution I see here is education for consultants to be factual and really evaluate situation based on facts rather their  personal preferences as well as disclosure of customer experience in regards to matter.   For example if you’re compating AIX to Linux   and never had experience with AIX  you only can say that, as well as state the fact  there are much fewer people running MySQL on AIX than Linux so risk  of platform specific issues is higher and there is less “community” experience.

Resource Availability –   As a company we have experience with some technologies and less or no experience with others.  This of course means we’re not as confident recommending technology we do not know – for example comparing MySQL to CouchDB it would be hard to be objective for us because we know much more about first than the second one.  Though full disclosure helps in this case to make sure advice is interpreted correctly.  The other  issue is – if customer decides on CouchDB he will likely hire another company to work with, while if it is MySQL – business stays home.   This really requires consultant integrity and this is important personal skill for Percona hires.  Another way is to ensure we as the company have experience for relevant technologies.  If CouchDB is better than MySQL for large class of application this means we better to get experience on CouchDB either inhouse or via partner.

Any other problems you see or solutions for stated ones ?

Donations instead of charges

The Parcell Tax initiative has failed  here in Pleasanton which means a lot of staff and program cuts from the Schools, which is something this area is proud of.

To partially offset the problem there is a fund drive.    For example you can donate to PSEE to save music classes.

Now I can understand why parcell tax measure failed – there are a lot of old people in Pleasanton having kids out of School.   I however do not understand why not to make these extra activities, which have no money for them in budget to come at added cost ?    There are some paid additional classes at the school already such as computer typing classes and I do not understand why this makes the difference.

I did donation more than to cover my fair share but I think this is a bad way to collect money for such an activities.  If you look at my  (or other individual) choices –  I can skip donating and potentially enjoy free ride because somebody else paid my share or well it may be it would not be enough to support the program.  If I do donate I have to donate more than my fair share to keep program in place because there will be people who will not donate.   This is screwed as it provides and extra excurses and motivation for people who can pay their share but choose not to do that.

Of course there are children which parents can’t afford to pay, though I think they are a small minority in this pretty expensive town.  I would much rather see they applying for scolarship or something like it to enroll into the classes and I even do not mind donating some money for it.  Such approach would ensure you’re not the most rewarded for the absolutely passive approach of sitting there and doing nothing as donation based funding rewards.

Co-Installations are new kind of Spam

What is getting annoying during last few years is the Co-Installations a lot of (typically free) software uses.    I’m am in particulary annoyed when it is opt-out instllation so if you just click through in default install you get software installed and if software which is installed has little to do with software being installed.

It is my expectation as a “user” the vendor has picked the default installation options to really provide configuration what most user wants and getting in some junk in there hurts my trust to the vendor.

One very annoying example I have to deal with comes from Sun Java.   If you install Java it will trypically check for updates automatically and suggest you to install them.  When you install updates it will try to sneek in Yahoo Toolbar  Each time ! With updates every couple of months it is only matter of time when somebody like me forgets to uncheck the checkbox and get the unwanted crap installed.  I surely did it more than once and had to clean it up with uninstall.

This stratregy probably works well recruiting Yahoo Toolbar users and may pay off in terms of number of users to Yahoo and Sun.    Many computer users probably would not notice and would not mind – and I guess this is what the marketing in this case count for.   Some other people (like me) get annoyed and loose their trust to Yahoo for getting in such spammy software distribution tactics and Sun for making it possible.

Expenses and Cash Flow

Back in Russia we saw little difference in the expenses and spending the  cash in personal finance.  Life was simple you buy something and you have expense – same thing.   It was very interesting for me to learn in my life in the states this is not the same thing.   It is very easy here to get an expense such as buying the car spending very little cash but  having liabilities instead.   If you count  car as an asset you would see after your initial purchase only interest payments and depreciation are “expenses” while you may have a lot of cash flowing out paying principle.

With Credit cards another interesting thing happens – because you get about 1 month of interest free credit (if you pay your ballance in full) you have about 1 month lag between expenses and cash flow.   If you spend a lot on a credit card one month it will affect your cash flow on the next month.

With income things may not be as straight as well.   There is something called “Flexible Benefits” which can be used for child care or medical expenses which  is seen as an income but does not directly become available cash in your bank account – you have to incurr expenses and apply for reimbursement to get true cash out of that.

These things get personal expenses much more complicated (though on the positive side they teach you bunch of concept you would need for business finance anyway).   Because of these things I have been left more than once I felt somethat confused about financials – the change in the bank account for the month may not really match the expenses you had during it.

How and Why

I recently got a review for our “High Performance MySQL” book which was saying “What makes this book so much better than any others I’ve seen in the last 8 years is its focus on the why, rather than the how.”

This is the great note – it really goes back to how I wanted to see the book and to the principles we follow at Percona, helping our customers.

How –  this can be found as general advice and recipies.

Why –   is understanding how things internally work, laws and principles.

If you only know How == recepies but lack core understanding you may apply the recepies to the wrong situation and get stuck if it does not work (or go google for yet another recepie).    If you understand Why having deep understaning of how things work you can see which How to apply and if things do not work out as expected you will have the knowledge to modify your approach to solve the problem

Of course in the end you have to take an action which means you need to know How to do things.  How is important. However How without Why is shallow.

Taxes in Virtual World

I heard Obama on the news today about closing tax loopholes for international taxes, which make me thinking about taxes in general in the modern world.  I work in the industry where location does not matter as much any more – you can provide remote services no matter where you physically reside and where your company is located. For many Web businesses the location is not critical too.  You may wish to have Sales, Business Development and Marketing guys in the right places but for most of headquarters it does not matter a lot.

So what if we view ourselves as being free to work in any location and  create a company in any place while fairly paying taxes ?  In this case it becomes a basic “value for money” choice both as individual and as a company.

I think this is especially interesting in USA as States have their local taxes too,  Income and Sales tax are being most important.   It is very interesting where do the money go and what kind of value I’m getting for them.   California has State income tax which is a heavy burden (especially for long term capital gains,  which have low 15% federal tax rate but same state tax rate).   Comparing to Washington State (I lived there for 2.5 years) which has no income tax I do not see what benefits I’m getting but I surely feel the pain of extra taxes.

I’ve spent some in UK too.  Comparing to Washington state I had a feeling I have to pay a lot more in taxes while getting much less in return. UK was especially evil to foreign workers not allowing to claim any child benefit tax deduction.  This was one of the reasons for me to get back to US, though not the main one.

What kind of values are important for me as return for my tax payments ?  I do not want things which I can provide myself or purchase on commercial basics, this means I’m not looking for most of “socialistic” stuff which every developed country spends their taxes on.  I think unemployment has to be optional insurance  (working in the foreign country being unable to get benefits of your premium is especially tough). I also would see too see social security/retirement insurance etc being add ons you can purchase but you do not have to. I believe in responsibility of individual for his actions and I belive via tax system most of the countries reward irresponsible behavior.

The things which taxes should go in my opinion is envinronment, infrastructure, safety, society development.   The fact I feel safe for my life and my family is extremely important to me.     I also would like to see my taxes being spent caring for people who can’t accept responsibility for their actions.  I believe kids should be well taken care of because we can’t chose our parents as well as people who are physically or mentally sick from their youth and so could not make arrangments for their care.

If I would be alone, working remotely as I am right now I may have chosen to live elsewhere.  You can probably find a tropical paradise with cost of living 1/5th of california and significantly lower taxes, which would allow to save money substantially or have a very different quality of life.   With kids things like safety, education,  medical care,entertainment, their peers, envinronment are very important.

What is about company ?   The company has similar benefits to measure up.  The US company deals with good legal system, is respectful and easy to deal with for US customers, has access to loans and equity capital. These are all benefits.  The heavy corporate tax rate (which is higher than in UK) is what you’ve got to pay for that.

I would like to see people and companies paying their fair share of taxes.  Few people like to pay taxes and I’m not exception but I know this is required for country to work.  I would surely look at closing loopholes for people and companies looking to avoid paing their fair share of taxes. At the same time I would look to make sure the taxes look fair to the people paying them.  I belive there would be less reason for people to avoid taxes and more support for strong actions against individual and entities doing so if people will understand where their taxes go and feel they are getting fair value for their money.

… Also US tax system is so complicated.  Somebody should redesign it following KISS principle 🙂

Percona Vision: Employees

At Percona a lot of vision aspects come from what we as a founders and later as a team consider good from the position of the other party.  With Employees/Consultant – the question is what would  I value working for the company ?   This is interesting because our job desires come a lot from personality aspects – some people love challenge others would rather have relaxed work with no challenges.  Some right success based payments other would rather have smaller steady guaranteed paycheck.  So I do not expect our approaches and values to be right for everyone but we expect you to love them if you’re person we would like to see as member of the team.

  • Consultants are main value creators. We do not see  consultants as “cost”  but rather as the true value creators which deserve lion share of consulting revenues, with rest – sales, administration being the overhead which has to be controlled and minimized.   When we just started Percona someone suggested me the good way to have a good business to hire some cheap labor force in India and get great gross margins billing customers 10x what is paid to the people actually doing the job.  I thought that was wrong and unfair and this is not the road we took.   We have employees in high cost and low cost countries but we pay them the same way based on the share of the true value they bring.    In particular with remote work the country where you live becames similar choice to the local neighrborhood.   We’re able to pay some 65-70% of gross billings to the consultants in average (as salaries, benefits and payroll overhead) which is a high number considering we do a lot of small jobs which has significant overhead.     Percona is a business and we as a founders took the risk of starting the business expecting some payout. We have not however planned to sell the company for quick turnaround or rip off consultants pocketing 50% of their billings. We expected a lot of fun and some fair profit share from our labor.       Working for MySQL I did not feel like my contribution were paid well both in terms of value and equity compensation. And really if you look into the people who were paid best and who made a killing when Sun bought MySQL these were mainly  sales and marketing positions which in my opinion are responsible for the preseption and packaging rather than true value.  I think it is very intresting excersise for anyone to fairly assess how much value they are bringing to their current employee and who really profits from it.
  • Consultants are Enterpreneurs. If you’re consultant you usually have couple of choices – either you’re doing your own stuff as independent consulting business or you go work for somebody else.   Working for yourself can be well paid but is risky and makes engineer to do a lot of things engineers often do not like to do – such as sales, dealing with contract negotiations, collections.   At Percona we wanted to provide something in between – we have people doing all this boring stuff such as sales, contracts, collections, insurance so engineers can focus on the stuff they like the most.  Plus working together we can be more efficient dipping into each other experience as well as have better life quality – if you’re lonely consultant your clients may well call you on vacations or in the middle of the night and you may have no one to cover you.  Working together allows to work more efficiently as well and shared client pool allows better utilization and less risks  which often means you can be paid more as consultant at Percona than being independent.  We also go further allowing consultants with good leadership coaching and management skills profit not only from their own work but from the work of people they supervise, so you can be running your small consulting business inside Percona.
  • Success based compensation. We strive to provide personal service for our clients which means each client gets lead consultant and the group assigned to them.  Lead consultant would mange most of the client needs while the group will be well understanding customer envinronment and following on all the issues so more people can be involved if needed as well as lead consultant can take vacation or a sick day off.  As customer typically stays with consultant and the group for long time this means  if you’re doing the good work for the customer there is more work to come your way.   Good consultants typically can have better utilization and they get larger cut of the revenues too because of the pie.   We also bill clients based on efficient time only – we do not think it is fair to have customers to pay for consultants learning general learning (not specific to their envinronment) or for making mistakes which again converts to great opportunities for great consultants.
  • Employees come first. We love our employees and want them to have a great life.     I know everybody says that.  Though I believe we can do a lot in this area as we do not need to sacrifise employee needs to please shareholders.  We engage in the businesses our employees are comfortable to deliver. We make sure they work comfortable hours and can spend time with their families or themselves.  We allow employees to put their family needs first, hence if there is any emergency with your family you just do what you need to do and the team will cover you.   As a good example I would say why do not we sell a lot of long onsite work – this is mainly because many of our consultants to dot want to travel away from their famility for weeks in the row.  I personally like to get out and visit customers in the Bay Area for the day or too and so we sell these services.     What is about customers when ?  Should not they come first ?  I think they should be happy on the second place because we ensure our consultants treat customer needs very seriously.  If customer has an emergency and his system is down and he is loosing thousands of dollars every minute I share his feelings of pain and urgency and a lot of other consultants do too.
  • Team Work. Nobody is as smart as the team.  We are seen as a team so we succeed as a team or fail as a team.  It is important our consultants are not working alone and there is always their team mates to help them.   We believe the team work is very important both to provide great quality of services to customers as well as to have great joy from work for human being – in particular while working remotely active team involvement is very important.
  • Openness/Integrity/Participation. When I was the part of management team of my first startup we  were far from open with our employees. They barely knew about company plans and deals came to them as a surprise, furthermore we were dishonest to them and our customers about what true intentions of various decisions were.  I was a junior partner at that time and though that is a way to do business.  When I came to MySQL I was shocked by how much transparent the company was.   Many things like company revenue were open to everyone and active participation of everyone was encouraged – meaning you could really get your opinion heard.  A lot of these things were lost in the corporate MySQL of recent years.   So back to principles – we are very open with our team about what we’re doing and why and we do not want to trick our employees clients or partners missleading them about facts, plans or visions. We actively welcome pariticipation of all the team in decision making process as reasonably possible.

Employment Security at big companies

A year ago I’ve been discussing with some people how unsafe and unsecure is working with small companies like Percona – which are small and bootstrapped, having no venture capital to relay on.     The comparison was obviously MySQL which just acquired by Sun at that point.

It is really interesting how things have changed.  As economic crisis stroke we see huge companies going bankrupt or having major cuts.  I know number of people which lost their job just because their whole department was no more.  They were great engineers but this is not enough as in many large companies people just tools.

With Sun/MySQL another thing is interesting – the people who were running MySQL before it was bought by Sun (Marten,Zack,Mark) are gone  (Zack is still at Sun but at other position). Many other people from senior management are gone as well  – these are the people which you as employee would have relationships and they would give you promises… and now be gone.    Now  even if you enjoyed Jonathan Schwartz vision about Open Source he may be no longer in position to implement his vision as Oracle takes over.

Interesting enough I think even Jonathan Schwartz  has little control here.   Sun is the public company and management team is not the major holders  –  Jonathan himself has well below 1% of outstanding shares.  Most shares are held by institutional investors and mutual fonds which have little of romantic nature – the dividents and capital gains are what they care about.   If head of the large corporation can’t deliver them he is risking to be replaced and the strategy which does not work be replaced with something which works.

The same applies to Venture Capital funded company – VCs want their money with a great return back first of all.   “Being Good” alone is not enough for them.   However if Founders/Visionaries and the team own the company they have the luxury of putting their values first and foremost if they choose to.

What does “I Can’t” really mean

What does it really means if someone tells he can’t do something ?   This is surely the popular excurse of my eldest child.   It is very easy to say you can’t do something and it makes it hard to reply something if we assume the claim is true.  If I can’t speak French it makes little sense to speak French to me I will not understand…  I know  this because I tried.   To often however I can’t  means something entirely different – it means either I do not want to or I believe I can’t do it.

The “Can’t” which is really “I do not want”  is the hard one because there is a question of how much hardship (either physical or emotional) the person can take and which really depends how important something is.    For example if you ask me if I can jump from the 3rd floor – I probably can’t do it just for fun. I may break my leg doing so or worse, though in case of fire I would jump because alternative or being burned alive is even worse.  What people can and can’t in the casual life depend a lot on their self discipline and hardship they are ready to take to reach the end goal.

Taking it to extreme if you’re saying you can’t do something you should ask yourself what if your life or life of your loved ones would depend on you doing this ?  If you would do it in case of extreme crisis it is not “can’t”  it is rather you do not want it for some reason.    The reason can be quite valid one –  I can jump from the 3rd floor but  this will most likely result in the broken leg so I do not want to do it unless absolutely required.    There are things which I can’t do, such as flying.  Even if my life would depend on flying I would not be able to do it.

Assumed “Can’t” is  another story.   Too often we do not believe in our ability to do something, refuse to try, refuse to learn or accept general preception in the world about something being impossible.   I remember as a child I could not ride a bike and I was afraid to try until I was forced by my Mom to try hard enough to finally learn.  “Can’t” turned to “Can” in a single day.    Many things take much more time and energy to learn and same as in previous case it becomes a question of how much time and energy are you willing to make things possible.

I do not speak French but I can learn to speak it.  I just do not want it because there is a lot of time and effort required but the benefit for me is marginal.  I currently probably could not run a marathon  but I could spend time to train but it is just not something I want to do.  Time and energy are scarse and we all have to do our picks.

Note in this case we know people in our age and physical conditions do learn French or train for Marathon, however even if there would not be it is not enough to say it is impossible –  many things from running 100 meters in less than 10 seconds to swimming cross English Channel (La Manche)   There are people who dare to try and make things happen.   Do not say you can’t unless you can prove it is physically impossible.

There are very few real “I Can’t”  in this world the rest are  “I do not want to”

What about technical advances

On the same topic I watched the nice lection by Dr. Albert A. Bartlett on Arithmetic Population And Energy.   As usually in such cases I like to check what oponents of the theory have to offer.

So what it takes for science and technology to offer continuing improving life for increasing population ?    There are basically three problems which need to be solved.

Energy This is most critical one as fossil fuels are not only non-renewable but they are also not recycable. Once its  gone its gone.     This is most pressing issue and so solution will have to be found short term.  The good thing the morden technologies already offer a lot – it is just lack of will (supported by cheap oil, coal, gas over last decades).   For  example France gets majority of its electricity needs from Nuclear power.  This is not as clean as many people would like but it is better than Oil or Coal.   There is Wind, Geothermal, Tide, Solar etc energy.   It would be also nice to see Fusion based energy developed getting safer alternative to nuclear power which also can work on much more abundant resources.    Solving Electricity problem is really enough –  the electric powered car or hydrogen based system can be “charged” by this kind of energy.

Resources There is only so much of various chemical elements available, and especially easily extractable.   Even with 100% recycling we get ever decreasing amount per capita.   There are also limited capacity of renewable resources  – forests, food growth etc especially as they get the pressure from the space element.

Space This is most theoretical issue –  with exponential growth we run out of space sooner or later Dr.  Bartlett says  with current rate of population growth we would get 1 person per square meter  for all land surface within 780 years.   This is of course far away but really problems  would happen much earlier considering how much space is really needed per person to produce food air etc, not to mention leisure needs, even with current life standards.

So what is really needed for growth to continue longer ?  Both for Resource and Space constrains we will need to go beyond the earth.   When do you think our technology will be able to get us out there ?   The first space flight was over 50 years ago and if you compare the progress to other parts of life it was not so astonishing. We furthest mandkind got so far is getting human to the moon some 30 years ago.    How likely is it we will be able to harvest resources from planets and asteroids in Solar system within next 50 years?   It does not seems likely to me.

The biggest problem here is energy again – the fossil fuels based space travel makes it too expensive to do any real production in the space so far.    Of course we can learn from science writers and hope there will be some transportation device discovered which would allow to teleport to any space but I do not think there is any foundation for such technology is.

If  Solar system remains rather distance source for  resources (and there is not much comfortable living space it can provide) the other stars which might contain inhabitable planets is even further in the future.  With hundreds of millions of stars in our galaxy and millions of galaxies this would allow to maintain exponential growth for quite a while.

There is however more troubling point – even if population growth stops and resource consumption stops growing we are already quickly running of energy resources and transition is inevitable.  How would it look ? How countries and individuals are prepared for it ?    The government seems to avoid taking a really serious steps toward solving this problem as call to use less and reduce standard of living would not earn many votes.

Because of this I expect rather troublesome rather than smooth transition with technology advances born in pain and suffering.