PraxIS April 2002

Managing reality in Information Systems - strategies for success

Systems Modelling Ltd.


Welcome and reader survey

Internet features
    Customer Service Case Study (Enterprise Ireland)
    Telecoms Council approves new '.eu' TLD (EUBusiness)

Euro features
    Eurobarometer polls
    Narrowing margin in UK euro polls (EUBusiness)

Risk Management
    Allfirst / AIB and Spreadsheet risks

On the lighter side
8 Web links in this newsletter
About this newsletter and Archives
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We value your feedback. Simply copy and paste the following section into a
new email message and send your reply to ISSUES (at) SYSMOD (dot) COM

What is the main BUSINESS challenge (strategy, marketing, finance, people) that you would like to overcome?

What is the main OPERATIONS problem (production, sales, distribution) you would like solved right now?

What is the main TECHNOLOGY issue (IT/IS, Internet, software) you would like to have help with?

For everyone who responds, if you would like to mention a web site you think would be of value to my readers, please let me know and I'll list them as space permits.


Thank you!

Patrick O'Beirne, Editor


Customer Service Case Study (Enterprise Ireland)

The Enterprise Ireland eBusiness acceleration fund supported 102 companies to encourage the early implementation of significant eBusiness projects. In their recent newsletter, they announced the Kingspan case study:

No manufacturer likes to consign an entire order to the scrap heap. Still
less do they like interrupting their production schedule to produce a
replacement batch in a mad rush. However, faulty or misinterpreted purchase
orders frequently create this problem for manufactures of made-to-order
products. Kingspan's eBusiness project has enabled them to simultaneously
reduce the incidence of such problems in their building panel business,while
also reducing the level of staff time previously devoted to preventing
such problems. 

The report honestly describes the project risks as well as successes.
In 1999 EUR 127,000 was allocated for the project. Overall the cost has come in at EUR 570,000 and there is still work to be done on it. The project team also vastly underestimated the amount of time it would take to get, what they would have considered very simple details, up on the system.

In 2001, as a direct result of the accuracy of the Online Ordering System, Kingspan has managed to save scrappage costs of EUR 127,000. The Online Ordering System allows the contractor to delay ordering until the day before the product is required. The contractor has also been able to eliminate the need for checkers. These people were employed to ensure the accuracy of the order, as the risk of error was high.

Divisional Commercial Manager Tom McGuinness considers the following to be the most salient lessons from this implementation:

(1) Ensure your customer base are as IT literate as your business. 'We [Kingspan] rushed in to try to keep out the competition, and when we got there the competition weren’t there, neither were the customers.'

(2) Ensure your back office systems are in order. Kingspan should have audited their ERP system long before they were faced with the consequences of doing business on the Internet.


Telecoms Council approves new '.eu' domain name (EUBusiness)

The adoption by the Telecommunications council of a regulation
to implement the .eu Internet domain name will create a truly
European identity in cyberspace, according to EU Enterprise and
Information Society Commissioner Erkki Liikanen.
Full story: 

Let me ask you ... how much will the new'.eu' top-level domain be relevant to you? I'd be interested in any opinions from existing registrants of multiple european domains (.ie, .uk, .nl, etc)



Eurobarometer polls 

These are a useful source of survey data: 
What do Europeans Think?

First Candidate Countries Eurobarometer - Complete report 
Flash Eurobarometer 121.2 - Attitudes on the euro in the Euro Zone 

Some quotations from the above:

As can be seen from summary table (7), an increasing number of Europeans believe the conversion of their national currency in euro was carried out to their disadvantage (higher rounded off values): 67% were of this opinion earlier this year, but there are now 74% of Europeans to believe this is true. Germany, France, the Netherlands and Ireland are once again where this feeling was the most strongly expressed with Portugal and Austria the least.

In Ireland and the Netherlands more than 50% of the population experience difficulties in recognizing coins.

17% of Europeans were using the euro as the only mental yardstick currency for their purchases, 49% still count using national currencies when making purchases and 34% count in both.

France is still the country where using a pocket calculator (or a converter) is the most widespread: 33%, 27% in Spain.
In Netherlands, Luxembourg, Portugal, Finland and Germany, 84 to 95% of respondents claim they do not use a

Women always outnumbered men in favour of maintaining double pricing, bank accounts as well as invoices and receipts in the national currency.

The public’s level of concern has not changed with regard to the value of the euro compared to the dollar: 49% of respondents remain “a little” or “very” concerned about this.

The highest levels of satisfaction can be found in Belgium, Ireland, the Netherlands, Luxembourg and Italy, with ratios varying between 78 and 86% of the population feeling this way. The unhappiest countries include Germany, who stands out with a level discontent clearly higher than the European average. Opinions are very divided in this country, as 49% of respondents said they were happy and 49% were unhappy.

In a recent visit to Spain, I noticed that some prices - e.g. laundry prices in a hotel - were only in pesetas. Museums were exact to a fault in their conversion. A 500 peseta admission charge is rendered exactly as 3.01 rather than being rounded down to 3.00. And for a regular shopper, grocery prices in Ireland now look high by comparison with Spain.

Narrowing margin in UK euro polls (EUBusiness)

A poll for the British Independent newspaper on Wednesday
revealed that if the UK government's stated economic tests for
adopting the euro had been passed and a referendum was called in
the next two or three years, 41 per cent would vote against
adopting the common currency and 37 per cent would vote in
favour. As the single currency becomes an ever more accepted
part of business life, the gap between those against and those
in favour is likely to continue to narrow.

Full story: 



At the end of March I reported on the Allfirst scandal at AIB, and the same issue mentioned the upcoming conference ( ) "Spreadsheet Roulette: The Hidden Corporate Gamble" in the University of Wales Institute. There is actually a connection between those two items:

Here are two stories on the topic: 
The Tangled Web of Deception
"Allfirst was using an older version of The Devon Trading System, which allowed Rusnak to get into the system and manipulate numbers coming in from Reuters feeds. During a subsequent review, the Allfirst risk-assessment analyst, who found out about this FX-pricing spreadsheet system, noted, “This is a failed procedure” and pointed out, “Technically the trader/s could manipulate the rates.” When the risk-assessment analyst inquired about obtaining the rates independently, the treasury-risk analyst noted that Allfirst would not pay for a $10,000 data feed from Reuters to the back office. " 
Excel ploy aided AIB fraudster
"Rusnak also took advantage of the Excel-based Value at Risk (VaR) model used by Allfirst treaury risk control personnel to estimate the estimated potential losses of trading portfolios."
"By supposedly hedging his bogus options, Rusnak reduced the VaR. But he also created false figures for "holdover" transactions that were supposedly set up late in the trading day. The treasury risk control official at Allfirst relied on a spreadsheet that accessed data on Rusnak's PC. Rusnak entered false holdover transactions that never reached the bank's trading software. But the higher open trading positions raised the VaR threshold that would have prompted further checks. "


Dilbert cartoon

Helping people accept the things they can't change 

Copyright 2002 Systems Modelling Limited, . Reproduction allowed provided the newsletter is copied in its entirety and with this copyright notice.

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Patrick O'Beirne, Editor

"Praxis" means model or example, from the Greek verb "to do". The name is chosen to reflect our focus on practical solutions to IS problems, avoiding hype. If you like acronyms, think of it as "Patrick's reports and analysis across Information Systems".


To read previous issues of this newsletter please visit our web site at


This newsletter is prepared in good faith and the information has been taken from observation and other sources believed to be reliable. Systems Modelling Ltd. (SML) does not represent expressly or by implication the accuracy, truthfulness or reliability of any information provided. It is a condition of use that users accept that SML has no liability for any errors, inaccuracies or omissions. The information is not intended to constitute legal or professional advice. You should consult a professional at Systems Modelling Ltd. directly for advice that is specifically tailored to your particular circumstances.

Copyright (c) SML 2002

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