Ground Stop

During emergencies learned ones make efforts using their intelligence.

Many tragic stories exist regarding the events of September 11, 2001.

Of interest for today's post is the actions of the Federal Aviation Administration (FAA) in grounding all planes either in or destined for American airspace on that fateful Tuesday morning.

**

By 9:30 in the morning on September 11, 2001, it had become clear to officials at the FAA that something was horribly wrong.

Unfortunately, they did not know exactly what.

They knew that two airplanes had crashed into the World Trade Center's North and South Towers and that at least one other plane, American Airlines Flight 77, had likely been hijacked as well.

An official listening in on some of the hijackers' cockpit conversations had heard someone say "We have some planes," but no one knew exactly how many planes the terrorists had.

Moreover, no one at the FAA had ever had to contend with a multiple-airplane hijacking. The last one, 31 years earlier, had ended when Palestinian gunmen blew up three foreign airplanes in the Jordanian desert.

They did not know what to do, so they did what they could: They ordered a full ground stop of all the airplanes in the United States.

A nationwide ground stop -- where no commercial, military or private airliner is allowed to take off and all planes in the air are required to land as soon as safely possible -- was unprecedented.

The FAA had previously implemented mini-stops for specific airports, cities or regions because of weather or safety concerns, but to intervene in air traffic on such a wide scale was unheard-of.

On its own and before the FAA got involved on the morning of the hijackings, the president of American Airlines had ordered the groundings of all American and American Eagle planes on the East Coast; shortly afterward, when he learned that United Airlines was also missing a plane, he halted American service nationwide. United executives quickly followed suit.

After the FAA declared its ground stop, it had to figure out what to do with all the planes that were already in the air. It sent notices to pilots, called NOTAMS, instructing them to find the nearest airport and land their planes as quickly as possible.

As a result, Southwest Airlines sent planes to Denver, an airport it never used, and huge JetBlue jets bound for New York City landed in tiny airports in upstate New York.

At 10:31 a.m., FAA Administrator Jane Garvey sent a message to all international flights headed to the United States Turn around or land someplace else.

That someplace else, in most cases, was Canada.

Garvey worked with officials at NAVCanada, the semi-private organization in charge of Canadian air traffic, to devise a plan. Four hundred planes were already high above the Atlantic on their way to the United States. About 200 of those were not yet halfway across the ocean, so they turned around and headed back to Europe; the others were redirected.

Many of these (38 flights, carrying about 6,600 people) landed at the Gander Airport in Nova Scotia - pictured above.

Others, instructed to stay away from Canada's largest cities, landed in Deer Lake, St. John, Goose Bay, Moncton, Mirabal and other towns.

Some of these planes had to dump fuel into the ocean so they would be light enough to land; others, by contrast, were running low on fuel and caused a panic by telling NAVCanada controllers that they, too, had been hijacked. That way, their pilots thought, they would get landing priority.

At the same time, 34 diverted planes from Asia were landing in Vancouver.

By about 6 p.m. EST, the skies were finally clear.

**

We know now that there were no more terrorised planes in the air but at the time the FAA didn't have that information and had to operate on incomplete information.

It remains in the eyes of Honestly Lay Bare one of the more fascinating - and prudent - organisational responses to an unfolding event that one can think of.

Post based on "Grounding of Planes on September 11, 2001" by the History Channel

Hail Mary

I closed my eyes and said a Hail Mary prayer

With those words, the great American footballer – Roger Staubach – captured the essence of that magical moment in time when you have nothing else to give but blind faith that it is going to work out ... somehow.

Had it not been for the pass that Staubach made to Drew Pearson in a 1975 American football wild card game it is not too far of a stretch to think that such an eloquent description would have been lost to the world and the concept of a long bomb would have remained so poorly named.

Today we are going to explore how the world of internal audit respond to the business equivalent of a Hail Mary pass.

But first.

It is December 28th, 1975.

The place — Metropolitan Stadium, Bloomington, Minnesota.

The Minnesota Vikings and Dallas Cowboys had fought to a 10-7 Dallas lead for most of four quarters of football.

Finally, with 1:51 left in the game, the Viking offense capped a drive with a Touch Down, to go ahead 14-10. Dallas now needed another Touch Down of their own.

Quarterback Roger Staubach took over the Dallas offense at their own 15-yard line.

He did an admirable job moving the Cowboys to midfield in nine plays, all the while fighting sore ribs made tight by the cold Minnesota winter wind. But Dallas was out of time-outs and there was now less than 30 seconds on the game clock. One sack or even a completion in the middle of the field, and time would be all but exhausted.

It seemed the effort would be fruitless.

Lining up once again in shotgun formation, Staubach took the snap, pump-faked left, then turned to his right and fired the ball deep downfield.

Cowboys Wide Receiver Drew Pearson was out there, being shadowed by Vikings Nate Wright.

Both turned to the outside to follow the flight of the ball, Pearson cutting under Wright. But Wright would slip on the frozen turf. Nevertheless, he seemed to be in position to stop the pass.

As the ball came down, Pearson pushed off of Wright and caught the pass, trapping it against his hip at the 5-yard line.

As Pearson strode into the end zone, free safety Paul Krause hurdled over Wright, screaming at field judge Armen Terzian for the interference call that was never made.

And an orange whizzed by Pearson at the goal line.

For his effort, Terzian was struck in the head and cut open by a whiskey bottle thrown from the stands.

The old Met crowd, celebrating another Super Bowl just a moment before, was now quiet, seething in anger and gaping in stunned disbelief.

In a post-game interview, someone described the play to Staubach, who had been hit immediately after throwing the ball and didn't see its ending.

"You mean he [Pearson] caught the ball and ran in for the touchdown?" Staubach asked.

"It was just a Hail Mary pass; a very, very lucky play."

“I closed my eyes and said a Hail Mary prayer.”

**

Here at Honestly Lay Bare sport central it is fair to say that our knowledge of the history of the Hail Mary pass was somewhat lacking before we started researching this post.

As we did come to learn of the deeds of Staubach on that cold December day the analogies with that all too familiar last gasp, hope against hope, business initiative that we have all seen became all too clear.

It is the business Hail Mary Pass that Honestly Lay Bare always has found the most difficult to provide assurance over.

Sure, we can check that the processes are in place just as Staubach no doubt had practiced many set routines.

What we as a profession, however, seem incapable of doing is providing real time assurance over that hope against hope business initiative. An initiative that is both at once immeasurably risky and capable of untold rewards if it comes off.

And that then begs the question – should we.

Are there some transactions that Internal Audit has no real business interest in?

What value does Internal Audit bring to a business Hail Mary transaction?

If the answer to that is none we destined to become the modern day Armen Terzian.

Someone there to enforce the rules in the less stressful times but when it really matters we are but a hinderance.

Now if you will excuse us it is back to the ball game.

The Modern Day Tea Leaf

The only relevant test of the validity of a hypothesis is comparison of prediction with experience.

Honestly Lay Bare likes to read the New York Times for two reasons.

Firstly there are always interesting articles contained within.

Secondly, because it makes us feel smart (no mean effort!).

A couple of months ago there was a great article about one of the many impacts that Google has had on America.

As you read the article by Eduardo Porter ask yourself whether a similar mechanism should be utilised to understand what it is that organisations are thinking about.

**
Ancient Greece had the Oracle at Delphi.

The Shang dynasty had oracle bones.

Contemporary America has Google.

Earlier this month, Lawrence Summers, President Obama’s top economic adviser, unveiled a new class of tea leaf to gauge the direction of the American economy: Google searches.

The number of queries for “Great Depression,” which surged earlier in the year, had declined sharply, Mr. Summers noted. Economic anxiety is abating. The economy is probably turning the corner.

It was not the first time Google was invoked to show us the way.

The company has a tool to track the path of the flu virus by looking at geographic trends in Internet queries for related terms. A study by Google researchers suggested search patterns could be used to track everything from home sales to the popularity of tourist destinations, and add to the accuracy of forecasts for new-home starts and car sales.

Polling has long been used by marketers and politicians to detect shifts in fashion and policy. Surveys of consumer confidence play a major role in economic forecasting. Economists have also tried to marshal collective wisdom with “prediction markets,” where people’s bets on all sorts of things are distilled into a remarkably accurate forecast.

Still, there is something new and mysterious about the high-tech oracle.

Polls are a useful indicator of people’s tastes because they ask people what they like. Prediction markets require players to forecast. Google searches offer a roundabout impression of the world: what people want, what they fear, what they expect. It’s harder to tell what they mean.

What was going on when searches for terms related to suicide jumped fivefold last November? Was it the recession? Were people looking for techniques? Maybe it was the proximity of Christmas.

The number of searches for terms about depression in the economics category peaked in February, but so did searches about recovery. Anxiety about a Great Depression has abated since then, as Mr. Summers suggested. So has interest in the term “dead cat bounce.” But in June and July people became very interested in a “double dip” recession.

For all the uncertainty about the meaning of Google’s statistics, using them to help make the case that the economy is turning the corner might be a shrewd move.

We might not know exactly what they signify, but they can provide any economic forecast with a populist cover.

**

Imagine if we could harness – in the way that Google does for society’s thoughts – what an organisation is thinking at any one time.

Why is this important?Honestly Lay Bare has always been of the view that a sound internal control environment is one that is built on a robust communication framework.

Sometimes the key messages can be drowned out by the noise and we have long looked for a mechanism that would allow us to forecast what is around the corner – surely one of the holy grails of the management of risk.

Continuous control monitoring is but one aspect of what it is that we are referring to. It tells you what is happening with the transactions.

What we as a profession need to discover is what are the thoughts that give rise to the transactions.

And more importantly, how do we capture them.

Putting privacy issues aside (and yes we acknowledge that that is a big thing to put aside) ... we have come to the conclusion that the time is now right for real time analysis of all employees' email correspondence would add immeasurably to our understanding as to what it is to be an organisation.

Fine Line

It is a fine line between pleasure and pain.

Surely it is a thought that has crossed the mind of anyone that has ever set up a governance framework; operated within one or sought to deconstruct an inefficient one.

Is a carrot better than a stick when seeking to motivate a group of people.

**

Well researchers at Harvard University and the Stockholm School of Economics have recently concluded that the carrot is better than the stick – at least when it comes to building human cooperation. While previous studies have focused almost exclusively on punishment for promoting public cooperation, here rewards are shown to be much more successful.

The new study, which finds that rewards robustly build compliance and cooperation, could help in developing solutions for thorny problems requiring the cooperation of large numbers of people to achieve a greater good. It was conducted using a computer-based public goods game, a classic experiment for measuring collective action in a laboratory setting. The study contradicts previous research, which has stated that peer punishment is the only effective mechanism for promoting public cooperation.

Lead author David G. Rand, a postdoctoral researcher at Harvard's Program for Evolutionary Dynamics, says the work has implications far beyond subjects' behavior in a computer game.

"All of us engage in public goods games, on both large and small scales," Rand says. "Climate change is a huge public goods game: If each person does his or her part to conserve energy and reduce CO2 emissions, it benefits us all. On a more local level, public goods games include volunteering on school boards, helping to maintain public facilities in your community, or cleaning up after yourself and doing your share of work at the office."

"In these types of domains, where people interact repeatedly with each other to solve a group social dilemma, our work suggests that rewards result in better outcomes than punishment," Rand says. "Rewards can change individuals' behavior and encourage cooperation without the destructive negative consequences that come with punishment."

The study examined cooperation among 192 participants in a public goods game probing the fundamental tension between the interests of an individual and a group.

Over 50 rounds of interaction, each of four participants in a group would decide how much to contribute toward a common pool that benefited all four equally. Each participant was then able -- at a cost to him or herself -- to either reward or punish each of the three other subjects for their contributions to the group, or lack thereof.

As in real life the study subjects tend to resent "free riders" who fail to contribute to a group yet reap the benefits of membership in it.

"But despite this anger at free riders, rewarding good behavior is as effective as punishing bad behavior for maintaining public cooperation and leads to better outcomes for the group," Rand says. "When both options are available, reward leads to increased contributions and payoff for the group, while punishment has no effect on contributions and leads to lower payoff for the group."

Previous research has suggested that punishment can compel cooperation in anonymous two-time interactions where individuals need not worry about reputation or retaliation -- a scenario the study found unrealistic, since most of our real-life interactions are recurring, with our reputations always at stake.

"Sometimes it is argued that it is easier to punish people than to reward them," the researchers write. "We think this is not the case. Life is full of … situations where we can help others. These sorts of productive interactions are the building blocks of our society and should not be disregarded."

Post based on Carrots Are Better Than Sticks For Building Human Cooperation, Study Finds Science Daily 4 September 2009