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The Irregular Newsletter of Z/Yen Group Limited

Catch up with current projects, new ventures and see some very bad puns (Editor: bad metaphor) via Z/Yen's blog or the eagerly awaited newsletter.

To receive your copy electronically, email This email address is being protected from spambots. You need JavaScript enabled to view it.

Security Forward Workshop and Dinner – 23 April 2015

Security Forward Risk and Intelligence Forum’s Spring meeting was held at the Z/Yen Group offices at 90 Basinghall Street in the City of London. There was a record turnout of around twenty people and quite a few new faces around the table.  The meeting started with a presentation from our guest speaker Chris Smith, who is the Global Head of Contingency Risk for HSBC with responsibilities for business continuity planning and crisis management with oversight of physical security. Chris has spent twelve years with HSBC, latterly in Hong Kong, and his presentation was entitled ‘The impact of the pro-democracy movement’s demonstrations in Hong Kong and the impact on business’. He described crisis management as what happens when business continuity stops working properly. Chris described how the ‘occupy movement’, known as the ‘umbrella  revolution’ impacted upon HSBC. The Bank had certain inherent advantages, as it is the pre-eminent bank in Hong Kong and has a great deal of influence. It is known locally as the big elephant and just referred to as the Bank. It also has the advantage of multiple locations. However, nobody knew quite how the disturbances would play out. Luckily the ‘occupy central’ group were mainly students who were very active, but did not want trouble and were very polite most of the time. They were making the point for democracy and the bank was prepared for occupy Central, although not sure whether it would turn ugly. The occupation of Kowloon was much more confrontational and contained elements of society, including the Triads, who were willing to use violence as business was being interrupted and causing real hardship to small traders. Not only did the bank have a crisis to deal with, but some of their own people were involved with the demonstrations. It was at this point that it was realised that the Bank’s plans were not really adequate or as efficient as they should be. In particular, the trade business (documentary letters of Credit and the like) is still paper intensive, as all Bills of Lading and associated documents have to be checked. This created logistical problems and meant using alternative locations where desks were needed for the trade business. The Business Continuity Plan had to be invoked and there was a real commitment from the senior executives whose support was vital. Lessons were learnt and are now being applied and the trade business is now much more resilient. Chris described Crisis Management as really being resource management. Civil unrest is unusual in Hong Kong as it interrupts and interferes with business, but it may happen again due to the political situation with China. This was a fascinating presentation and the Q&A session was most informative.

After our usual round-robin to identify ‘in tray’ issues and concerns, our second speaker was our own ‘Speaker in Residence’, Lt Colonel Crispin Black, MBE, MPHIL. Crispin is an independent expert on terrorism, intelligence and security, as well as a novelist. Crispin’s presentation was entitled ‘Business Ethics-vital underpinning of capitalism or naïve contradiction in terms’. Crispin suggested that fewer people are willing to defend capitalism than would have been the case a generation ago. He described capitalism as representing ‘an absence of rules and lightly regulated’ and the ‘freedom to make money’. He pointed out that the City Of London has been responsible for an explosion of wealth, requiring imagination and intellectual skill as well as an entrepreneurial spirit. He said that there is now a disdain for money making institutions which seems to be shared by many in this country and a move against respect for money making. He suggested that left wing philosophy and anti-capitalist opinions are no longer challenged as they would have been and that there are fewer people willing to defend the City and the financial institutions. He drew upon the likes of ‘Philip Marlow’ to illustrate what we once aspired to emulate, a hero with an old fashioned Christian morality who always had a moral compass to influence all his actions. Crispin said that the corporate culture of an institution is set by those at the top and we have seen how one bad apple at the top can change the morality of an institution, resulting in a disdain for capitalism as a whole. The City of London is a great wealth creator and the over reliance of rules should not replace personal values and standards. There  was a lively discussion about the over reliance on rules and regulations and the unintended responses to them. This presentation was very well received and thought provoking as always.

Following the meeting, we dined in at The Aldermen’s dining Room at the Guildhall, which provided a fascinating venue for us, courtesy of Alderman Michael Mainelli. Our ‘dinner speaker’ was Brigadier Allan Mallinson, the distinguished military historian and novelist, who was encouraged to continue on from his presentation as the participants wanted to hear more from this very knowledgeable expert. After the dinner, copies of his latest book ‘Words of Command’ were presented to those who were there.

Our next meeting is planned for Thursday the 2nd July.

Tricks of the Trading – ExtZy for Kids - April 2015

Tricks of the Trading – ExtZy for Kids
 
    
ExtZy is Z/Yen’s prediction market system.  Since 1999, we have used ExtZy in a variety of ways, as a tool for making crowd decisions (“the wisdom of crowds”), as a playpen for trading ideas (Avatars), and as a fun game for the Z/Yen CommunityZ.  Originally invented, and later patented, for a large media company as a market for music, sports, fashion, and other items of interest for young people, during the 2000’s the primary markets for CommunityZ members became countries-at-risk and technological-futures.   Our staff, mad about cricket, made cricket team news the dominant internal Z/Yen game.  We have provided deeper analysis of the market, including work by Xueyi as a UCL MSc student before she joined Z/Yen.

We have always been interested in exploring ways of using ExtZy with clients from creating a market in research & development projects to helping construction contractors work together on quality and timing for multiple projects.  Thus, we were delighted when some of the Chartered Institute for Securities & Investment (CISI) players approached us.  The CISI were looking for a stock market game which would provide a longer-term view for investing that would appeal to school students studying towards CISI qualifications.  Together we created “CISI Exchange”, aka CISIext, a bespoke version of ExtZy, for GCSE, AS, and A-level students.  The game offers players the chance to build up and manage a portfolio of shares, but with a difference.  Instead of buying and selling company stocks, players buy and sell shares in countries, Premier League football clubs, and a selection of up-and-coming music artists.  Each stock represents a relevant website or search term.   Dividends on the shares are calculated via unique visitor statistics for each site.  The higher the number of unique web hits, the higher the dividends paid out each week on an entity’s shares.  Apart from being a bit of fun, the game helps students to understand how markets work and illustrates the importance of popularity and perception on share prices.

The first CISIext game ran in autumn 2014 and was split into three game periods coinciding with school term times.  Over 100 students at five UK educational institutions regularly played the game, with CISI students in Sri Lanka also getting involved.  The countries market proved to be the most attractive for investors, with students quickly picking up on evolving problems in the Eurozone as shares in France and Germany became popular options for players.  Players also looked to Russia as tensions with the Ukraine escalated.  Even in the football market, players spotted that there was value to be had investing their hard earned points in West Ham, as the club had an unforeseen good run in the Premier League.

CISIext also had its own LIBOR/FX/spoofing/insider-trading scandal when two players were restricted from trading following a breach of market regulations.  Rather creatively, they had created duplicate accounts to cross-sell shares at overly inflated prices - good lessons for the students of the importance of clear rules backed by surveillance, regulation, integrity, and ethics.

The autumn 2014 winner was Danny Mcintyre, a student studying the Level 2 Award in Fundamentals of Financial Services at Victoria College in Jersey.  Danny achieved a net worth of 11,857 points, over 8,000 more than the second-placed student.  Danny was presented with an iPad for his efforts by Jersey Committee President Paul Clifford and the Committee’s Student Liaison Officer, Eliff Carr.  Danny felt that he had benefited from “staying one step ahead of the competition” by relentlessly searching the market for low value shares where other players had not spotted their potential.

The CISI Exchange has also been used as part of a three-day employer insight event for sixty students, organised by Investment 2020 and hosted by three firms in London.  Students used the game to develop their knowledge of basic investment strategies, culminating in groups presenting strategies they utilised while playing the game.  All-in-all, we are delighted to be supporting CISI’s fantastic outreach programme to students and together share our tricks of the trade to further financial literacy in a fun way.

Unpredictable Turn of Events in Z/Yen’s Predictive Analytics

Ian Harris is a relatively rare sight on the speaker circuit.  Indeed, in the analytics world, we might describe one of his appearances as an anomaly, perhaps even an outlier.  But in the Civil Society sector; health, membership and charities, interest in Z/Yen’s predictive analytics work is growing fast and Ian is now spreading the word.

Earlier this month, Ian conducted a Charity Focus Roundtable at Baker Tilly.  The specific topics covered included:

  • improving donor/member income and retention;
  • reducing volumes of unsuccessful contacts;
  • predicting the effectiveness of grant making;
  • reducing errors in transaction processing. 

Ian’s main message is that predictive analytics is no longer the domain of only the largest most complex organisations, requiring proprietary software and serious data skills. To deliver that message, Ian debunked several myths about analytics and Big Data currently circulating. Powerful tools for analytics are now either free or bundled with ubiquitous software, such as Excel. These tools can be used by information analysts and data jockeys in organisations of any size, with just a little additional training.

The Baker Tilly event was peppered with interactive puzzles and paradoxes, borrowed from Z/Yen’s predictive analytics courses, to illustrate and illuminate the topics.

Z/Yen is now offering a range of coaching and training courses for those clients who want to utilise the skills of their own analysts to get more out of their information. Highly modular, the courses can be tailored to specific sector and/or specific client needs. So far, Z/Yen has deployed the courses in specific client settings, but watch this space, as we intend to launch some general appreciation courses for both senior executives and information analysts, to enable you to ask the right sorts of questions and understand the answers.

If you are interested in learning more about Z/Yen’s predictive analytics work, please contact This email address is being protected from spambots. You need JavaScript enabled to view it.  by e-mail or on (020) 7562 9562.

Security Forward Workshop and Dinner - 21 January 2015

Security Forward, Risk and Intelligence Forum’s October meeting was held at Z/Yen's offices in the City of London. To a full room, Martin Huddleston led with a talk on DSTL and APMG's Cyber Defence Capability Assessment Tool (CDCAT).  Martin Huddleston is a specialist technical leader at DSTL, headquartered in Salisbury, England.  His presentation led to a lively debate on the merits of various methodologies to cyber-risks.


Martin was followed by our ‘Speaker in Residence’, Lt Col Crispin Black, gave a presentation wittily entitled "The Hitchhiker’s Guide to Predicting the Future … Accurately".  Crispin attempted to grapple with a paradox that has become part of British life: how is it that members of our government and business elites seem incapable of swerving out of the way of seemingly obvious disasters?  The Western military defeat in Afghanistan at the hands of a few thousand men equipped with Kalashnikovs and flip-flops, and the debauching of the UK’s leading retailer, Tesco, were the two examples he chose to highlight.

He identified nine themes behind these and other disasters:

Facts: much more difficult to establish than you might think – even when no one involved is actively trying to obscure the truth. He cited the military historian, Colonel Archibald Gracie’s, experience as a survivor of Titanic – he needed months of detective work to pin down the exact details of survivors’ stories.

Language: even languages closely related to our own, produced by cultures similar to ours, can be a barrier to understanding. Increasingly, elites now speak a private form of of our own language, English, that is of little use in forecasting the future.

Self-hypnosis: a phenomenon identified by the Harvard historian, Barbara Tuchman, whereby a group of decision makers deny and distort reality to persuade themselves that a particular venture is going well rather than disastrously.

Face: often felt to be an Oriental or Asian vice but in fact alive and kicking in Western bureaucracies. Saving the face of political, military or business leaders has become a core activity of governance.

Audit: we seem to live in a fire and forget world where few like to have their decisions and their consequences examined forensically.

Deception: little awareness especially in government service that sometimes our opponents or enemies actively wish to seduce us into a course of action that will prove our undoing. What you see on the ground may not be reality but a giant ‘come hither’ sign.

Deformation Professionelle: many of our elites effectively live in mental ‘gated communities’ and cannot think beyond their own specialities.

The need for Diversity: used most often in Western public discourse in its racial or cultural sense. Rarely as a warning against closed thinking.

Macbeth Syndrome: The reluctance of decision makers to break off from an unfolding debacle – even when it has become obvious. As Macbeth famously put it to his charming consort: "I am in blood Stepp'd in so far that, should I wade no more, Returning were as tedious as go o'er."

After the presentations, the team moved to the Worshipful Company of Furniture Makers for the traditional cocktail before dinner.  Crispin chose a blue martini named a "Yale" as something that Professor Mainelli would have been unable to predict, nor order in the hallowed crimson halls of the Harvard Club, but could have as an Honorary Liveryman of the Furniture Makers.

Our dinner speaker, UCL Professor Adrian Furnham, gave a wonderfully incisive, yet easy-on-the-ear, and memorable talk around his new book with Ian MacRae, "High Potential: How to Spot, Manage and Develop Talented People at Work".  His psychological insights triggered a great discussion ranging from corruption to challenge in large organisations.

Our next meeting is planned for Thursday, 23 April 2015.


Security Forward Workshop & Dinner - 1 October 2014 – Z/Yen & Honourable Artillery Company

Security Forward, Risk and Intelligence Forum’s October meeting was held at Z/Yen's offices in the City of London. There was a record attendance and quite a few new faces around the table. The meeting started with a presentation from our ‘Speaker in Residence’, Lt Col Crispin Black, who gave a presentation entitled "The Middle East: What Next?"

Crispin questioned the position of Putin and Russia with regard to the Middle East. He pointed out that movement towards democracy is not a natural progression.  He highlighted the need to engage Iran in the process of stabilising the region.  When seen from an historical perspective, the current borders are a recent imposition resulting from the Sykes/Picot recommendations on carving up the old Ottoman Empire and sharing it out between Britain and France.  Saudi Arabia has only been in existence since 1932.  'Islamic State' does not recognise these artificial borders and talks of Al Sham (Greater Syria) which means the whole of the Levant and Mesopotamia, as part of the Caliphate, harking back hundreds of years.  Perhaps we are reaping the results of that recent European legacy?  The map is not fixed.  As ever, Crispin’s presentation was challenging and stimulating and enjoyed by all.

After our usual round-robin to identify ‘in tray’ issues and concerns, our second speaker was Ben Fletcher, who was Deputy Director of Olympic Security.  Ben was a Member of the Olympic Security Board, who were collectively responsible for programme delivery of the thirty five related projects and management of the one billion pound budget.  He gave a fascinating talk entitled "Securing the Games: Planning, Delivery And Lessons From The UK’s Biggest-Ever Security Operation".  He described the sheer complexity of drawing together so many different Agencies and trying to co-ordinate all the different groups' inputs.   Folks wished they'd had far more time for Q&A with Ben.

We ended the day with a most enjoyable dinner at The Honourable Artillery Company (HAC) Headquarters in the City, where Michael Mainelli is an ex officio member, and were fortunate to have one of our Founder Members as our dinner speaker.  Peter Fraser-Hopewell gave an excellent presentation entitled "The Challenge of Restructuring" which was most informative.  He raised the security implications and cultural challenges of cross border ownership of a strategically sensitive company undergoing restructuring.  We raised our glasses in celebration with a Desert Healer cocktail.

 Our next meeting is planned for Wednesday 21 January 2015.