via blog.sriramk.com

One of the occupational hazards of working at Microsoft was attending offsites. These were 2-3 day affairs, typically cloistered watching endless sessions of Powerpoint in a out-of-the-way Washington resort with a bunch of execs. At one such shindig I was attending a few years ago, one of the attractions was a talk from a couple of external speakers, both of them local VCs. The talk was covering certain things Microsoft could be doing better in particular areas (being deliberately obtuse here to honor confidentiality and besides, the details aren’t pertinent here).

This VC threw up a slide at the end of his slide to summarize most of his talk. It had the following sentence in bold which made the room break into applause.

Don’t be so f-king strategic

All large companies (and I do mean all - this is not a post about Microsoft) tend to be in love with finding the right ‘strategy’ in place before doing anything. There are reams and reams of text written on what exactly strategy is and how to go about having a good one. Some of them are actually quite good (for example, Porter’s work on the five forces). You could often get rapped on the knuckles (or worse) for being ‘off-strategy’.

Don’t get me wrong. Good strategy combined with good execution is a joy to watch (case in point - Apple over the last decade). The last thing you would want is people off doing their own thing and being all ‘off-strategy’ and rebellious.

But here’s the problem.

You’re not Steve Jobs and your organization is not Apple. And your well-thought out strategy is probably terrible.

If there’s one thing I’ve learnt in the corporate world, it is that a staggering amount of ‘strategic analysis’ is nonsense and guesswork. There’s nothing wrong in admitting that. Figuring out the market, what the future looks like, what users want or heck, even what your own company can do is hard. Bloody hard. Eric Reis says that all startups are experiments and the same can be said for any company in a fast changing industry too.

Most times, you don’t even know what the right thing to do is until you have actually gone out and tried a bunch. Experimenting might be hard if you’re launching spacecraft (and even that doesn’t stop Elon Musk or Jeff Bezos). But if you’re in the software world, there is no excuse for not building a bunch. For not trying a bunch.

Building stuff and getting people to use it will always lead to better results than sitting in a bunch of meetings with over-paid consultants and trying to extrapolate from various signals and trends on what people might want and what you should be doing. Even if you had the right strategy in place at one point in time, that isn’t good enough. The world changes so quickly that you might need to do a 180-degree turn in a matter of months to react to changing user behavior or market trends. Top-down strategic planning doesn’t deal well with this.

What you need are many experiments in parallel. Not all of them need the same amount of resources and not all needs to be released to the public. But you absolutely do need people working on crazy, random things. It doesn’t matter whether you call it 20% time, whether you call it a research department or it is just what all your employees do on weekends. But it needs to happen in some form.

This only works if your corporate structure is built with the flexibility to do random things. Especially things which are ‘off-strategy’.

If you’re a mining corporation in Minnesota, allowing an employee to experiment with adhesives might wind up with you revolutionizing the stationery industry (this happened).

If you’re the world’s largest software company in 2005 and your strategy is to sell phones to enterprises, going off-strategy to understand/build what normal consumers want, might save you years later (this didn’t happen).

So go out there. Try random things. Don’t be so f*king strategic.

via jpuopolo.com

1.     Minimal Viable Product thinking can be a trap – there has recently been a huge movement toward creating a “minimum viable product” and then going out to market as quickly as possible. I would argue it is important to temper this trend. This has turned into a tendency to quickly roll out half-baked functionality because developers believe they are following the MVP mantra.  Well thought out features that deliver value, even if they take a bit longer to come to market, will (in my opinion) deliver more ultimate value to the product and to the user experience. I am all for iterating something early on once it is in the hands of the customer, but I would argue that some companies have misconstrued this and roll out an untested, half written piece of functionality

2.       Keep an eye on what really matters – Many good product managers fight with this all the time. How many times do people from different lines of business ask questions like “wouldn’t it be cool if it could do this?”. When I really boil it down, there are only 3 reasons why you should build any given feature in an early-stage start-up. Here they are:

• It will help make money – If you are a start-up working towards break-even, then this needs to be ever present in every decision you make. If it won’t help move the needle and get you closer to profitability, you may want to reconsider it. I come from a school of thought in which you want straightforward business models with a straightforward path to cash. There are few out there with unlimited runways and you always need to be concerned with this in your approach.
• It will improve the user experience – User experience has become such a core function to any product manager. Is this easy to use? Do people get pissed off when they have to use key features on the site? Will it cause people to abandon your site?  UX can be a core competency and key differentiator. Always focus on this! Even if it is as simple as a nicely done pop-up or a cleanly design button, it all matters when it comes to UX.
• It will improve efficiency and scalability – Will this feature allow you to do more with less, does it allow you to hold off hiring more people to do the same function, or does it make the people you have more effective? You should always consider this to stay lean and mean as possible

3.       Create a vision for the product – it is important to not limp forward from one feature to the next. This can be an easy trap to fall into. Having a tight 6-week development cycle is important, but having a grasp on what you want this thing to look like in a year or 18 months is important. This isn’t to say that you should wireframe the thing to death and do work for something that may or may not be built. Rather, have a feeling for what you want the experience to evolve into.

4.       Beware the “Frankenstein” product - Every product manager should ask them this question on a regular basis.   This ties in with the above point about product vision, but I generally find this can be more of a tactical problem. Does each feature compliment the next, is it tied together in a comprehensive UX flow or does it feel tacked on? “Frankensteining” new features into a product can be fraught with danger for the long-term health of a product. A good product manager needs to fight the urge to quickly throw a button into the UI to satisfy a line of business, but rather should look for a way to re-orient the UI. Sometimes you have to go a step further and actually yank or pull old functionality out to keep things clean. Pulling the bolts out of Frank’s neck can be painful but is sometimes necessary. It forces you to step back and refocus on your goals for the UX.

5.       Know your customer, and then start to segment – it is very difficult to create a one size fits all approach. As you get new and different user groups you need to make a critical decision. Either try to serve all people with a reduced product or split the product up into different lines. Each are faced with their own set of products, you begin to fragment your offering. There is an argument to be made creating upgrade paths are a logical and allows power users progress to a rich feature set of products.

In summary, the role of a product manager is never easy. They are constantly getting pulled in 50 directions by constant and evolving requests. That said, if you keep these 5 core principles in mind it will make it easier next time you embark on building a killer product.

Self-educate to survive

By Ryan Downie on August 22, 2011

If you lack a formal design education, you’ll need to self-educate before you can progress in your career, says Ryan Downie. Here's a checklist of the subjects he studied to help him to understand more about web design

Many website designers (and designers in other areas) do not come to the job through a formal process of training and education. They just sort of fall into it. The problem with this is that you start out with no knowledge of basic design principles or what makes a design good.

I started off this way, as did a lot of my online friends. I left my job and ended up designing because I had a computer and there was not much work around in the village where I lived. I just looked around on the internet, found some ideas of what I thought was good design at the time and then created a design. I was not armed with any knowledge about grids, typography, colour, hierarchy and so on that an education would have given me. Even though my design could have been called a success (it got featured in all the galleries and noted as a trend setter for 2008 with its handwritten fonts), I felt I was missing something.

Fast-forward a year or so and I was designing more of the same – browsing around the internet for inspiration and jumping into Photoshop and putting out a layout. It was only when I started to get to know other designers via Twitter and IM that I became aware of what I was missing. I needed to educate myself, and do it fast, if I was to survive in this world of design.

Self-education

New designers need to learn and become self- educated if they want to progress. This means learning design principles, digesting them and coming to understand them over time, just as you would if you were still in education.

The best advice given to me was to question everything. Why this colour? What emotion does it provoke? What else has it been used for? Why does it work? I find that the key to design is to question every element’s purpose. If it is not needed, remove it.

What I learned

Here’s a sort of checklist of the subjects I studied to help me to understand more about design. I hope it will help you.

Grid and layout

The grid helps with the alignment, balance and flow of the design. Mark Boulton has a fantastic book called A Practical Guide to Designing Grid Systems for the Web on this matter. Check out www.designinggridsystems.com for further details.

Colour theory

What makes colour important? Does it provoke an emotional response from the audience and, if so, why? Is there enough contrast? Sites such as www.colourlovers.com and kuler.adobe.com are great tools.

Fonts

With improved web technology, fonts have come in to the limelight and it has never been easier to find information on them. But don’t just pick a font because you like it. Do some research on it. Most foundries have a description of the font and what its purpose is. Use sites such as typedia.com for research. Smashing Magazine also has a great post on principles for readable typography. See www.smashingmagazine.com/2009/03/18/10- principles-for-readable-web-typography/.

White Balance, hierarchy and contrast

These three things are hugely important as they move the eye around the design. Without these aspects, a user cannot be guided. Take a look at what Six Revisions says about this and more by going to: sixrevisions.com/web_design/using-power-structure-and-gestalt-for-visual-hierarchy/.

Design history

Have a look back at design movements from the past and learn what made them great. Look at designs from the great art movements such as Dada, Art Deco, Bauhaus and Pop Art. See how they used design principles, played with them or deliberately ignored them and move on from there.

Design inspiration

Inspiration hits us all in different ways. If you’re planning to design a website, try not to browse around the web. Instead try and get out of the house, go for a walk and clear your head. Look at magazines, the packaging on a product, a film poster or even movie credits from the 60s ... anything to get that spark.

This article originally appeared in issue 216 of .net magazine - the world's best-selling magazine for web designers and developers.

Steve Jobs's resignation from Apple has sparked plenty of commentary on his achievements, his personality, and his vision. He deserves the attention: This is a man who transformed the technology world and helped build Apple into what was, at least for a few hours earlier this month, the world's most valuable publicly traded company.

But the idea, so common in this week's media coverage, that Jobs was an inspired savant who succeeded by taking big risks on personal hunches, is way off the mark. Rather than worship at the altar of inspiration and "going with your gut," the rest of us should use this moment to consider the fundamental strategies that drove Apple's success.

We've all heard the old saying about the balance between inspiration and perspiration. As well-known as this saying is, we often tend to forget it when we come upon things that really look effortless. Take Apple. The past decade has seen what appears to be an almost inevitable ascent of the company and its products to the pinnacle of success. Each iteration is better than the last; each new product is a hit from day one; and the lines outside the Apple stores remain full of customers who don't just like the products — they love them.

With each launch of another device or application, Apple seems to pull exquisite new products, fully formed, from the minds of a few geniuses in turtlenecks. From the outside, Apple's secret sauce would seem to be inspired design (read, "think different"); and inspired marketing of that design. In other words, 90% inspiration and 10% perspiration (mostly experienced by eager customers scrambling to get the latest iPod or iPad). iPhone 5? "Eureka!"

The truth is really a lot different.

Apple would love us to believe it's all "Eureka." But Apple produces 10 pixel-perfect prototypes for each feature. They compete — and are winnowed down to three, then one, resulting in a highly evolved winner. Because Apple knows the more you compete inside, the less you'll have to compete outside.

We are all mesmerized by Apple's beautiful design, from device to screen, to the packaging itself. We see what the magicians want us to see. What we don't see is the 18 months of negotiating with the music companies. Nor the three years of teaching the supply chain that the Macbook Air had to be really thin, really light, and really enduring (10-hour battery). When those improvements intersected with the iPhone's great screen technology, the iPad (that glorious Air/iPhone hybrid) exploded.

The device without the backstory is like a Ferrari with no engine inside: beautiful, but going nowhere. Just ask Sansa, eReader, Zune, or dozens of others who've gone up against Apple products without success.

And, oh, the marketing: brilliant marketing. No one is better at creating attention than Apple. But attention without fulfillment is a straw fire. The magicians say "Presto!" and we gasp in delight. But they deflect our attention from the back-breaking labor that goes into assuring a perfect customer experience, hundreds of times a day, at 300 stores around the world, and countless conversations on the phone.

The initial blast of attention is great. But it's the massive word-of-mouth ripples of the great experience that make the market. The glitter you see is not the explanation; look carefully, and the inspiration/perspiration ratio is where it should be. Under Jobs' leadership, Apple has done 10 times the amount of relevant homework of most companies — internal competitions, supply chain training, endless deal-making, endless recruiting, training, and generating and sustaining employee excitement that you just can't fake.

If others emulated that, all of that, their results would be a lot more like Apple's. And our economy would start really humming again.

Apple's CEO is unique, but one lesson we can take from his story is more universal. Corporate boards worship "superstar CEOs". But more often, the first executive makes for the best executive.

REUTERS

via theatlantic.com

This year, dozens of startup company founders will be forced out and replaced by experienced outsider CEOs, often from public companies, brought in by venture capital investors to provide "adult supervision." You can bet that none of these companies will become the next Hewlett-Packard, the original Silicon Valley technology company -- or the next Intel, Microsoft, Oracle, or Apple.* These tech juggernauts span software, hardware, services, and media, but they all have something in common. Their founders served as transformative chief executives.

Still, the conventional wisdom among investors, if not the media, is that founders need to move out of the way for an experienced CEO to take a company "to the next level."** This piece of mythology plays into Steve Jobs' remarkable story. Apple would not be the world's most valuable and powerful technology and media company today without Jobs, its co-founder and its CEO from 1997 until last week, when he resigned because of health issues. But from 1983 to 1997, Apple was run by John Sculley (former president of Pepsi), Michael Spindler (a marketing and sales person from DEC and Intel), and Gilbert Amelio (former CEO of National Semiconductor), during which time it managed to go from inventing the modern personal computer to becoming an irrelevant, money-losing sideshow. Rival Michael Dell said that the company should be shut down. So much for that.

***

Outsider, non-founder CEOs are often overvalued because many corporate boards think the answer to their problems is a superstar CEO with an outsized reputation. This leads them to overpay for people who are good at creating outsized reputations through networking, interviewing, and taking credit for other peoples' achievements--all bad indicators of future success.

Rakesh Khurana has amply shown how this delusion of the charismatic savior creates a dysfunctional market for CEOs, allowing the small number of existing public-company CEOs to demand and receive extravagant compensation. The myth of the generalist CEO is bolstered by the many fawning media portrayals where CEOs say that their key jobs are understanding, hiring, and motivating people--leading board members to believe that you can run a technology company without knowing anything about technology.

WHY FIRST EXECS MAKE BETTER CHIEF EXECS

The list of successful founders-turned-CEOs is daunting. You have Bill Hewlett and David Packard (HP), Robert Noyce and Gordon Moore (Intel), Bill Gates (Microsoft), Larry Ellison (Oracle), Steve Jobs (Apple). You could say I've hand-picked these names from among hundreds of founders who turned out to be lousy chief execs. You might be right. That's why we need data.

And the data shows that the first executives really do make better chief execs. That's because they have:

1) Better long-term focus: Rüdiger Fahlenbrach found that large U.S. firms run by founders had excess stock market annual returns of 8.3 percent (4.4 percent after controlling for a variety of factors). Founder-CEO firms invest more in research and development and have higher capital expenditures--things that you would expect to improve long-term performance rather than short-term earnings. 

2) More value: Renée Adams, Heitor Almeida, and Daniel Ferreira found that founder-CEO firms have higher valuations than other firms, even after using instrumental variables to control for the endogenous nature of founder CEO status.**

3) The right incentives: Darius Palia, S. Abraham Ravid, and Chia-Jane Wang also found that founder-led firms were more valuable than other firms. In addition, they found that founders were less sensitive to traditional pay-for-performance incentives, implying that they're not in it just for the money.

This shouldn't be surprising. Founders tend to know their companies better than outsiders. They know their industries better than most outsiders. They are often more motivated than the average hired-gun CEO to improve a company's long-term prospects. They are more likely to be innovators, having taken the step of founding a company. In tech firms, they usually know technology better than a typical outsider CEO, whose specialty skews toward marketing and networking.

But there's one other factor that comes into play. Investors can't count on a founder CEO to do what they want because a founder has her own power base among the company's employees. An outsider CEO, by contrast, comes in as the creature of the board and knows her first job is to keep the board happy. In theory, this should be good because it makes the CEO accountable to the shareholders -- assuming that the board represents the shareholders, which is a big assumption. But in a startup company, the interests of the majority investors and the interests of the company are not always aligned. Most obviously, if the company gets a new round of funding at a low valuation, the current investors can benefit--if they are the ones putting in more money at the low valuation. And so replacing a founder CEO is often simply a question of power.

Obviously, not every founder CEO has the ability to be a good leader of a large public company. On balance, however, the ideology of adult supervision may be doing more harm than good. And as with every ideology, you have to look at who benefits from it to understand why it exists.

---

*Google, arguably, did succeed with adult supervision in the person of Eric Schmidt, CEO from 2001 to 2011. But note that the two founders remained in top positions (outsiders referred to the three as "co-CEOs") and Schmidt was succeeded by one of the founders.

**Full disclosure: I've worked at two start-up technology companies (although I joined one more than three years after it was founded). In both cases, the founder CEO was replaced by an outsider--and in both cases, the board later brought back the founder CEO.

via blog.linkedin.com

What makes entrepreneurs different, and where do they come from? Are they born or taught? Are they unusually mobile in their careers? Does geography play a role? Do mentors and relationships matter?

Numerous studies explore these questions by surveying hundreds of entrepreneurs. At LinkedIn, we take a different approach, on a different scale. By sifting through more than 120 million public profiles, we can analyze tens of thousands of startup founders’ [1] profiles – and find common threads linking their careers.

Our infographic above shows the top over-represented business schools among entrepreneurs – with Stanford, Harvard and MIT Sloan taking the top spots. If that doesn’t come as a surprise to you, take a look at the distribution of the founders’ age at their first startup. While young (and serial) entrepreneurs are often in the spotlight, our data shows that 65% of entrepreneurs are 30 and older – and only 2% are serial entrepreneurs.

The value of a formal education for startup founders is a hotly debated subject. Let’s take a look at the data – in particular, the fields of study that entrepreneurs chose in college. Technical majors (except civil engineering) are over-represented among founders; nursing and administration are under-represented. While computer engineers find it easier to start companies in their areas of expertise, civil engineers and nurses need more infrastructure support.

Some companies are breeding grounds for entrepreneurs – they’re more likely to appear on founders’ profiles than others. They include tech-heavy companies like Adobe  Systems, Apple Inc., eBay (including Paypal, of the Paypal mafia fame), Electronic Arts, Google, Microsoft, SGI and Yahoo! among others.

Are some industries harder to break into than others? Yes, according to our data: founders of semiconductor and pharmaceutical startups usually have previous industry experience, while founders of retail, consumer goods, leisure & travel and professional training companies don’t.

Also, most “academic” startup founders (those listing higher education as their previous industry) are in nanotech, biotech and medical devices.

Relationships and mentors are crucial to entrepreneurs’ success – and this is reflected in the connections they have on LinkedIn. Founders are disproportionately connected to venture capitalists, bloggers and recruiters. Most importantly, LinkedIn and the relationships they build in their career help founders find the capital, publicity and talent they need.

If you’d like to hear more about the entrepreneur DNA, take a look at the presentation I gave at the 2011 Startup Festival.

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[1] Startup Founders are LinkedIn professionals who identify themselves as founders (or co-founders) of U.S. companies created after 2000, with a LinkedIn company profile, and that currently have between 2 – 200 employees. We have excluded small law, consulting and real estate firms, as well as LLCs (limited liability companies) – and assembled a pool of over 13,000 entrepreneurs. We then compared them with the average LinkedIn member and highlight characteristics that disproportionately appear among startup founders.

via blog.asmartbear.com

I built this software for myself, and then it turned out a million people wanted it exactly how I originally envisioned it.

After hiring a few people, being the CEO became a lot easier, and I was able to focus on high-level strategic plans instead of fighting fires.

I wish we had spent less time talking to prospective customers before designing interfaces and writing code.

The decision of whether to form an LLC, S-Corp, or C-Corp made a significant difference in my startup’s success.

Selling the company was an easy decision, and everyone in the company was on the same page.

We were so good at acting that our first few customers never knew we were a new company with no employees and buggy software.

Thanks to a software patent we filed, we never had a serious competitor.

Our most effective marketing campaigns where the ones filled with buzzwords and non-specific claims.

My lack of an MBA degree made building a company from scratch harder for me than for others.

I wish I had spent more time reading and weighing the pros and cons of various philosophies instead of just jumping in and doing what I thought was morally and financially sensible.

via beust.com

There, I said it.

I know it’s fashionable to mock PHP for its antiquated syntax and semantic quirks, but I just like it. Here is why.

PHP is like C

This is really the main point of this post, and it’s a realization so simple that I’m surprised not more people made it. I have often observed that developers mocking PHP tend to be much more positive when I ask them about C.

“C is alright, it’s not OO but it was designed with a simple goal in mind and it does that very well. It’s straightforward and very well documented”.

Does that remind you of another language? That’s right, PHP! PHP is exactly like C. Either you like both or you don’t like either, there is no claim you can make about PHP that can’t be made about C as well, and vice versa. PHP was created with one very simple goal in mind: enabling the insertion of programming logic in web pages. And it does this fantastically well.

The absence of OO functionalities in both languages is a bit of a bummer (PHP 5 tried to address that with mixed success), but with some discipline, it’s really not hard to reach a reasonable architecture for your programs.

PHP never let me down

I write PHP code very sporadically, whenever I need to update one of my web sites or when I need to put together a small piece of web functionality that requires some programming. I am familiar with the PHP syntax but I don’t know much of its API, because I use it so rarely, so I pretty much need to relearn it from scratch each time. Whenever I need to get something done, I spend a decent amount of that time looking up docs on Google. And PHP absolutely shines in this area. It’s not just that looking up a function name will give you its API documentation as a first hit, but you can literally type what you need in English (e.g “most recent file in PHP”) and it’s very likely that you will find how to do it in just a few clicks.

You can even misspell function names (see for example the result of my incorrect query for strtime) and you will still land in the right place.

PHP is robust

I know it sounds silly considering how primitive and old the language is, but the bottom line is that code that I wrote more than ten years ago has been working absolutely flawlessly and without any changes for all that time. I don’t even bother writing tests for most of the PHP I write (obviously, I would be a bit more thorough if this code were destined to be used in a more mission critical web site). Not writing tests is not the only software taboo that I break when I write PHP: I happily mix up presentation and logic all the time. That’s just how PHP is supposed to work, and when the site you are working on is low volume and only of interest to a very tiny fraction of users, you probably don’t want to spend too much time on tasks that look overkill.

PHP’s documentation is great

It’s hard to pinpoint what exactly makes PHP’s online documentation so useful. It’s probably a mix of the content, the syntactically colored code samples, the CSS and most of all, the examples at the bottom. These are absolutely priceless and I don’t understand why not all API documentations do this.

Whether you are looking up an API function or a UNIX command, the first thing you want to see is examples, not a laundry list of its options and switches or a formal definition of its parameters. Very often, reading the example is all you need to carry on with your work and you can always read the more formal documentation if you want to use the function in a more advanced manner.

Universal support

Most Internet providers offer PHP support out of the box, so you don’t need to resort to more expensive VPS providers. I have yet to see this kind of universal support for any other language than PHP. Not even Ruby on Rails, let alone Java, is available on mainstream providers, thereby validating the claim I made five years ago that Ruby on Rails won’t become mainstream (I regularly receive emails about this article asking me this question, and I keep responding “Nope, still not mainstream”).

High reward

There is nothing more exciting than modifying a file, hitting Refresh on your browser and seeing the result right away. This brings me back to the very first days that I started experimenting with a web browser, more than fifteen years ago. Modifying an HTML file and seeing the result almost instantly hasn’t lost its appeal, and PHP is certainly continuing the tradition.

Sometimes, I don’t even bother editing the files locally and then transferring them: I ssh to my server and modify the files live. If something goes wrong, git makes sure that I can always back up my changes very easily. By the way, the combination of git’s branches and PHP is very powerful, allowing you to switch between entire web sites with just one command.

Conclusion

Even though writing in PHP always feels like going back in time, I’m never reluctant to doing it because I know that it will be rewarding and relatively easy. PHP has by far the highest “Get in, code, get out” factor that I have found in a language, and until another language comes around that can do better on this scale, I will be using PHP for many more years to come.

Update: Discussion on Hacker News and Google+

A sophisticated personalization algorithm--combined with ever-savvier editors--has helped boost the Today box on Yahoo's home page to the tune of a 270% increase in clicks since 2009. Here’s what they're doing right.

If you’ve flitted across the Yahoo home page recently, you know how addictive its Today module can be. That’s the little box at the top of the page (as in the image above) containing four news stories, including at least one you usually can’t help but click on.

And Yahoo says that’s entirely intentional, the result of a lot of hard work spent trying to figure out how to serve up news that you, yes you, will find irresistible.

The company started work on a powerful personalization algorithm four years ago. Now it’s paying dividends. The system generates 45,000 totally unique versions of the Today module every five minutes. (All five screenshots in this post were taken within minutes of each other, using different Yahoo accounts.)

And in the two years since the algorithm went live, Yahoo says clicks on the stories in the Today box among U.S. users have increased 270%. This year, the module is averaging a whopping 1 billion clicks per month in the U.S.

Yahoo is now in the process of rolling out the algorithm--it's nicknamed CORE (for Content Optimization and Relevance Engine)--to its other media properties. It hopes CORE's results will entice visitors to gobble up ever-more content in the Yahoo ecosystem, and in the process, turn it into the "premier media company" that its executives like to claim it already is.

They might be on to something. The Yahoo home page is the most visited of any page in the U.S. containing programmed content. Every day, 35 million unique visitors give it a look-see, and 110 million stop by every month. The increase in number of clicks in the Today box between this year and last--167 million--is the equivalent of adding an entire LATimes.com to Yahoo’s content ecosystem.

So how does the personalization strategy work? Yahoo gave Fast Company a peek behind the curtain, and it turns out that the secret sauce is only partially due to the work the algorithm does on its own. The other impact it's having is on Yahoo's Front Page editors, who are getting savvier about what will appeal to readers, in large part due to the insights they're gaining from the algorithm.

Here’s how it works.

The Algorithm

CORE’s job is to figure out which stories, which come from Yahoo's own content producers and external sites and publications, are going to play well with which specific audiences. Yahoo generates a profile for each user based on information they've entered about themselves, like gender and age (if they're a registered Yahoo user), the places they've visited when they've come to Yahoo in the past, and the stories they've already seen during that particular visit. Based on that information, it's up to CORE to figure out which of the 50-100 "packages" the editors have going at any one time will be most interesting to that particular visitor.

"Package” refers to those combinations of photos, headlines, text, and links that get dropped into the Today box. In the image at left, for example, the story about Speaker Boehner along with the three little links to the "Senate Dems," "Treasury," and "Debt fear" stories constitute a "package."

To test the packages, CORE grabs a portion of Yahoo visitors as they arrive on the site and uses them as a guinea pigs, tossing some of the new packages at them and seeing what attracts their interest. (Who gets lumped into that bucket is determined by a virtual "flip of the coin," so that the pool is not always populated by the same people.)

CORE then uses the results of those tests to rank every package according to how well it will do with each visitor, based on their particular targeting attributes. So, for example, it might decide to serve up a particular package to women in the 35-44 age range in Peoria, for example, but not to men in that same age range in Peoria, or women in the 21-24 age range in Seattle.

"What we’re doing here is matchmaking," Raghu Ramakrishnan, chief scientist for search and cloud platforms, tells Fast Company. "We know something about the user, about their context, and about the pool of articles we have. At the end of the day, it’s a matchmaking task."

But the algorithm doesn’t work in a vacuum. It is also helping the editors who run the Front Page become smarter about how to put the packages together in the first place.

The editors

CORE can’t go hunting independently through the thousands of stories among Yahoo partners' content, or the stories generated in-house, to find the pieces that might most interest Yahoo visitors. It totally relies on the Front Page editors to tell it what to look at, and that’s where some of the art comes in.

The Front Page team is staffed by a group of online journalists, including its chief, Liz Lufkin, a former deputy managing editor at both the San Francisco Chronicle and USA Today. Lufkin tells Fast Company that the insights the team is gaining from CORE are adding nuance to their traditional understandings about what various audiences might be interested in.

Some of the findings buck conventional wisdom. CORE has shown the team that boomers don’t just care about health and retirement; they also like music. Teens will click on parenting stories, as well as science and weather. And men actually are sometimes interested in fashion (which Lufkin chalks up, at least in part, to their trying to make sense of what their wives and daughters are wearing).

And while the average woman might not spend a lot of time following the ins and outs of football or baseball, some sports stories do capture their attention. The day that Fast Company visited the Front Page team, CORE predicted that a story about Derek Boogaard, the hockey player who died unexpectedly this spring, would do well with women--and indeed, according to the dashboard that Front Page editors monitor continuously, it did, perhaps because of the tragic nature of his death.

CORE is also helping Yahoo’s editors get a jump on upcoming stories. Months before the wedding of Prince William and Kate Middleton, the Front Page team noticed a rising interest in the bride's sister, Pippa. So while it took the rest of the media a few days after the event to catch up to the frenzy surrounding the maid of honor (and her headline-grabbing bum), Yahoo’s editors were ready from the beginning.

"When the Royal Wedding happened--and [Pippa’s] dress [hit]—we knew it was going to be big," Lufkin says. "All weekend long we went Pippa-crazy. The data let us know to be on the lookout for that."

But it’s not all fluff. The algorithm is also turbo-charging the team’s ability to tackle hard news. When Congresswoman Gabrielle Giffords was shot in January, for example, the editors tested a variety of angles to determine which one would grab the most interest. The winner, according to CORE? A story about the aide who tried to save her. It might not be what the New York Times would lead with, but it was the story that resonated most with the millions of people who landed on the Yahoo homepage that day.

"Our readers have a much wider range of interest than we've traditionally given them credit for," Lufkin says. "If we can present them content that is compelling, there’s a really big opportunity" to grab their interest.

Having the editors at the wheel also means they can override the algorithm when important news is at stake. On the day Fast Company visited, President Obama was slated to give an important speech that evening on the draw down of troops in Afghanistan.

The algorithm predicted that the story on the speech would do miserably with Yahoo visitors. And indeed, according to the dashboard, it wasn’t getting many takers. But the editors still flipped the override switch, ruling that the story would be shown to all visitors to the home page at least once, irrespective of what the algorithm said. It was, and Yahoo willingly took the hit on clicks. Some stories, the editors say, everyone simply needs to see.

But, still, they monitored the story’s performance for any insights about what was resonating. "We want to learn how to do it better the next time," Lufkin says, "not to sensationalize it, but to make it more relevant."

As CORE moves out to other parts of the Yahoo network such as Yahoo News, where it’s headed next, the company hopes to reap a similar performance boost as it’s seen with the Today module.

Meanwhile, the company’s scientists are working on making the algorithm even smarter, determining what you’ll like not just based on simple variables, like your age and gender, but based on specific things you’ve expressed an interest in before, like "golf" or "Warren Buffet."

And the human touch will conintue to play a part. 

"From the beginning, we made the decision that we weren’t going to make everything entirely algorithmic," Ramakrishnan says. "We need to leverage the editors and let them [use] the data we have to make smarter decisions in real time."

E.B. Boyd is FastCompany.com's Silicon Valley reporter. Twitter. Google+. Email.

A recent study links intelligence test results with browser usage — and the results don’t look good for users of Microsoft’s Internet Explorer, especially its older versions.

The study, titled “Intelligence Quotient (IQ) and Browser Usage” by Canadian company AptiQuant, compiled IQ test scores of 101,326 individuals older than the age of 16 and divided them into groups according to the browser they use.

The results are fascinating. Users of Internet Explorer 6 have an average IQ score barely more than 80; Firefox and Chrome users fare much better, with average IQ scores of around 110, while Opera and Camino users have an average IQ score more than 120.

It’s also interesting to note that average IQ scores of IE6 users were significantly higher in 2006, and that the IQ scores get better with newer versions of IE.

Internet Explorer 6 has long been a thorn in the side of developers who hated it for its non-compliance with web standards, while users struggled with its many security flaws. This new study will probably induce more mockery of the ancient (but still sometimes found on older computers) browser and its users, but it’s probably not telling us that much about the browser itself — it’s about unwillingness to upgrade to a new version of any software.

The study concludes that “individuals on the lower side of the IQ scale tend to resist a change/upgrade of their browsers.” It’s only logical that users with a higher IQ are more likely to experiment, choose a different software version or variant (notice that users of IE with Chrome frame score very high on IQ tests) or listen to upgrade suggestions and security advice.

In March, Microsoft started a campaign to get users to stop using Internet Explorer 6. But did it take into account the fact that many IE6 users tend to have lower than average IQ scores? Maybe that’s the key to finally getting rid of the world’s most hated web browser.

“Individuals on the lower side of the IQ scale tend to resist a change/upgrade of their browsers. … Now that we have a statistical pattern on the continuous usage of incompatible browsers, better steps can be taken to eradicate this nuisance,” the study concludes.