Modular designed systems
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The power of modular designed systems

Summary
Using John Holland's theory of adaptation in evolutionary biology is a trait that increased the number of surviving offspring in an organism's ancestral lineage.  In Deacon's conception of evolution an adaptation is the realization of a set of constraints on candidate mechanisms, and so long as these constraints are maintained, other features are arbitrary. 
in complex systems Baldwin and Clark propose an evolutionary theory of design.  They show how this can limit the interdependencies that generate complexity, M. Mitchell Waldrop describes a vision of complexity via:
  • Rich interactions that allow a system to undergo spontaneous self-organization
  • Systems that are adaptive
  • More predictability than chaotic systems by bringing order and chaos into
  • Balance at the edge of chaos 
within systems.  They do this through a focus on modularity. 
Design Rules The Power of Modularity
In Baldwin and Clark's book 'Design Rules The Power of Modularity' they propose an evolutionary theory of design.  The theory they apply is John Holland's theory of adaptation in complex systems.  They apply the theory to the evolution of early VLSI is very large scale integration of silicon on a single chip.  Robert Noyce and Jack Kilby realized that all components of a circuit could be fashioned on one chip of semiconductor material removing the interconnection wiring constraint.   systems as described by Mead and Conway and modular digital computer systems illustrated with IBM, AT&T and Digital Equipment Corporation (DEC) strategies. 

Setting the design decisions and tasks within a management and contractual framework of a market environment they identify rules that define the emergent structures that make up the designed system.  The evolution of digital computers is used as a demonstration ecology.  Baldwin and Clark assert that they have a multi layered complex adaptive system:
Like
Grady Booch advocates an object oriented approach to computer software design. 
Grady Booch
, Baldwin and Clark see control of complexity as the major problem of human design and implementation activities.  Once again the limitations of individual humans to understand a large set of interacting design dependencies must be overcome or a
Dietrich Dorner argues complex adaptive systems (CAS) are hard to understand and manage.  He provides examples of how this feature of these systems can have disastrous consequences for their human managers.  Dorner suggests this is due to CAS properties psychological impact on our otherwise successful mental strategic toolkit.  To prepare to more effectively manage CAS, Dorner recommends use of:
  • Effective iterative planning and
  • Practice with complex scenario simulations; tools which he reviews.   
complexity catastrophe
will occur.  Baldwin and Clark note that implicit dependencies hidden in the operations of an organization amplify the danger.  The problem is challenging to solve since a difficult balance must be achieved between enabling creativity and
To benefit from shifts in the environment agents must be flexible.  Being sensitive to environmental signals agents who adjust strategic priorities can constrain their competitors. 
flexibility
and controlling interdependencies. 
Design and task interdependencies
Baldwin and Clark therefore argue that the process of designing must identify interdependencies between the tasks of the design.  This requires knowledge of the properties of each potential component.  Those relationships are captured as design parameters based on:
  • The experience of the use of theoretical models, and
  • Practice of structuring the hierarchy of designed components and
  • Executing the resultant tasks of design.  That includes identifying alternative choices, and how they depend on one another. 
Typically designers
Walter Shewhart's iterative development process is found in many complex adaptive systems (CAS).  The mechanism is reviewed and its value in coping with random events is explained. 
iterate through the tasks searching for a combination of parameters that works
.  Baldwin and Clark highlight the risks of iterating endlessly while conceding that this is one of the most creative processes known.  

By representing the precedence of each task in a matrix Baldwin and Clark demonstrate the task dependencies.  

Clark, working with Rebecca Henderson, associated each subsystem in the task matrix with an organizational workgroup.  The defined areas of interdependency are seen as required communications channels between the workgroups.  Where no explicit dependency exists it is assumed that there are filters for the workgroups to ignore the information.  Other information flows indicated in the task matrix may represent problem solving flows across the organization. 

As the number of tasks and the number of unrecorded linkages increase, any single change in the task matrix may have lots of ramifications.  Baldwin and Clark assert that this trend should lead to increasing inflexibility, as all the current items become fixed.  That can lead to a complexity, M. Mitchell Waldrop describes a vision of complexity via:
  • Rich interactions that allow a system to undergo spontaneous self-organization
  • Systems that are adaptive
  • More predictability than chaotic systems by bringing order and chaos into
  • Balance at the edge of chaos 
catastrophe where there is a failure to invest in knowledge about embedded interdependencies.  organizations that are optimized to perform their current tasks cheaply are likely to suffer this fate driving out innovation is the economic realization of invention and combinatorial exaptation. 
and flexibility.  Baldwin and Clark argue that this risk can be avoided by modularization. 

Baldwin and Clark define a module as a unit whose structural elements are powerfully connected among themselves and relatively weakly connected to elements in other units.  They view abstract interfaces supporting information hiding as a way to achieve this modularization. 

The set of design parameters can be constrained by design rules.  Analysis of previous experience within the domain can identify formerly successful strategies and hence support the development of architectural rules.  These will predefine some of the design choices and replace the equivalent issues and dependency design parameters.  Baldwin and Clark promote that property to remove all, non test and integration, external communications of each subsystem to design rules.  The result are modular subsystems.  In practice Baldwin and Clark also advocate information hiding to ensure that external modules cannot break the rules. 

Baldwin and Clark discuss a number of illustrative strategies for enabling design rules: micro programming,  standardized circuits; which were adopted by IBM. 

Maurice Wilkes strategy of
Plans emerge in complex adaptive systems (CAS) to provide the instructions that agents use to perform actions.  The component architecture and structure of the plans is reviewed. 
representing any architected instruction in a computer as a micro program
implemented in the specific hardware of an implementation realized his goal of
Rather than oppose the direct thrust of some environmental flow agents can improve their effectiveness with indirect responses.  This page explains how agents are architected to do this and discusses some examples of how it can be done. 
isolating, in the micro program, the dependencies between the hardware and instruction set architectures


Mead and Conway's conception of nested, regular, modular structures for the complete process of creating computer chips transformed the design of integrated circuits from an ad hoc, unstructured, interconnected set of activities that was breaking down as more transistors were packed onto a chip, to a highly scalable alternative. 

The modularization allowed the scaling of the planar chip manufacturing process to be matched by that of the design of the integrated circuits with immense consequent economic effects.  Not all of Mead and Conway's solutions were adopted by the chip design industry.  However, the modularization they encouraged allowed for alternative design approaches to coexist and compete in the marketplace. 

Baldwin and Clark argue that modularity does three things:
  1. Increases the range of manageable complexity. 
  2. Allows different parts of a large design to be worked on concurrently. 
  3. Accommodates uncertainty is when a factor is hard to measure because it is dependent on many interconnected agents and may be affected by infrastructure and evolved amplifiers.  This is different from Risk.   through the presence of hidden parameters. 
Design and value creation
Modular mix-and-match flexibility creates options within the design and task structure.  The value of the options will vary across niches.  Baldwin and Clark see a 'force of value' originating in the minds of the designers, which is magnified by product markets and then further intensified by the workings of the capital is the sum total nonhuman assets that can be owned and exchanged on some market according to Piketty.  Capital includes: real property, financial capital and professional capital.  It is not immutable instead depending on the state of the society within which it exists.  It can be owned by governments (public capital) and private individuals (private capital). 
markets.  

They see the economic force of value operating through valuation technologies.  They assume a normal distribution of the uncertainty is when a factor is hard to measure because it is dependent on many interconnected agents and may be affected by infrastructure and evolved amplifiers.  This is different from Risk.   of the outcome of each modularization. 

They further see contracting and guidance technologies mediating the efficiency and effectiveness of the enterprises which support design activities. 

Baldwin and Clark distinguish design from other evolutionary processes arguing that new modular designs contain new elements, solving problems identified with the previous design, rather than replicating or recombining elements of the previous design.  'Instead, the new elements would represent new solutions to the problem posed by the prior set of designs' they write.  A modular design is a portfolio of options.  With a normal distribution of modules Baldwin and Clark argue that a system will perform square root of the number of modules better than an equivalent interconnected design.  With effective modular splitting comes the availability of the substitution operator where improved modules can be deployed with increased value.  Each attempt at an improved module is an experiment testing the value space. 

They admit that prior knowledge is typically integrated into the task structure in the
Walter Shewhart's iterative development process is found in many complex adaptive systems (CAS).  The mechanism is reviewed and its value in coping with random events is explained. 
iterative approach
to design.  They see this as consistent with mechanisms found in evolutionary biology.  However, they see the approach as suffering from severely diminishing returns.  Instead they advocate the actions of an architect in modifying the task structure to optimize the design process.  They assert that over time 'the modular systems that result from this second approach will come to equal their interdependent counterparts. ' 

One of their examples is the value of Microsoft's windows operating system.  They comment that it took until release 3.1 for this product to become widely deployed.  It is asserted that this was due to the decision by Microsoft to ensure compatibility with its earlier MSDOS, which became its most significant competitor.  

Design and structures
Baldwin and Clark see structural re-architecting as a
Plans change in complex adaptive systems (CAS) due to the action of genetic operations such as mutation, splitting and recombination.  The nature of the operations is described. 
genetic action
, the application of the splitting operator which generates modular structures. 

Baldwin and Clark argue that operators must be consistent with the structures that they work on.  Their modular genetic operators only generate or transform modules. 

To develop a modular system
This page introduces the complex adaptive system (CAS) theory frame.  The theory is positioned relative to the natural sciences.  It catalogs the laws and strategies which underpin the operation of systems that are based on the interaction of emergent agents. 
John Holland's framework for representing complexity is outlined.  Links to other key aspects of CAS theory discussed at the site are presented. 
Holland
's genetic operators then include: splitting, substituting, augmenting, excluding, inverting, and porting; Baldwin and Clark argue that design rules promote system
This page discusses the strategy of modularity in a complex adaptive system (CAS).  The benefits, mechanism and its emergence are discussed. 
modularity
and that this has amplified growth and innovation is the economic realization of invention and combinatorial exaptation. 


Baldwin and Clark compare design and biological evolution.  They comment that unlike biology designs do not have to separate variation and selection.  Human designers can decide what to try (variation) and what to select, but they argue biology must wait for natural selection to test the variation. 
The operation of a modular approach to design
Baldwin and Clark describe the evolution of the early computing market, including the effects of IBM's System/360 product and service offerings.  Their description elucidates the flexibility and adaptability of IBM. 

For Baldwin & Clark System 360 was a 'landmark design teaching designers to see the space of design possibilities in new ways'. The development of DEC's early mini computers was viewed as a demonstration of the effect and a key example of the exclusion and augmentation operators. 

Baldwin and Clark used AT&T's UNIX is a computer operating system.  It is a registered trademark of AT&T. 
and C is a small portable computer programming language developed by Dennis Ritchie of AT&T Bell Labs to support implementaton of a portable UNIX operating system.   to demonstrate the power and implementation of the inversion and porting operators.  
Design and industry structure
Baldwin and Clark describe how the presence of distributed options created by the modular operators enables the emergence of
This page discusses the benefits of geographic clusters of agents and resources at the center of a complex adaptive system (CAS). 
clusters of competitive firms
focused on realizing the value of the options.  If the transaction costs of the modular firms in the cluster are low the economic forces encourage the emergence.  Baldwin and Clark suggest if companies reflect the design structures induced by effective modular design the majority of transactions is an operation which guarantees to complete a defined set of activities or return to the initial state.  For a fee the postal service will ensure that a parcel is delivered to its recipient or will return the parcel to the sender.  To provide the service it may have to undo the act of trying to deliver the parcel with a compensating action.  Since the parcel could be lost or destroyed the service may have to return an equivalent value to the sender. 
will be within each company.  The cluster becomes a low cost economic entity to deal with. 

Investors finance firms in the cluster creating a second coevolving process.  Financial markets allow the investors to allocate capital is the sum total nonhuman assets that can be owned and exchanged on some market according to Piketty.  Capital includes: real property, financial capital and professional capital.  It is not immutable instead depending on the state of the society within which it exists.  It can be owned by governments (public capital) and private individuals (private capital). 
to the most valuable industry participants.  But the process is dynamic with the value often dropping over time prior to generation of new value in a next generation of designs as was seen in a number of computer industry clusters such as discs.  Baldwin and Clark intend to investigate this coevolution of modular design and modular industry in the second volume of the book. 



Complex adaptive system
This page introduces the complex adaptive system (CAS) theory frame.  The theory is positioned relative to the natural sciences.  It catalogs the laws and strategies which underpin the operation of systems that are based on the interaction of emergent agents. 
John Holland's framework for representing complexity is outlined.  Links to other key aspects of CAS theory discussed at the site are presented. 
(CAS) theory
should apply directly to Baldwin and Clark's modular systems.  This web aims to represent a strategic framework based on John Holland's ideas which are also the theoretical basis of 'modular evolution'. 

As such Baldwin and Clark's task structure must be a representation of a
This page looks at schematic structures and their uses.  It discusses a number of examples:
  • Schematic ideas are recombined in creativity. 
  • Similarly designers take ideas and rules about materials and components and combine them. 
  • Schematic Recipes help to standardize operations. 
  • Modular components are combined into strategies for use in business plans and business models. 

As a working example it presents part of the contents and schematic details from the Adaptive Web Framework (AWF)'s operational plan. 

Finally it includes a section presenting our formal representation of schematic goals. 
Each goal has a series of associated complex adaptive system (CAS) strategy strings. 
These goals plus strings are detailed for various chess and business examples. 
schematic plan
.  The designers and workgroups are CAS
Plans are interpreted and implemented by agents.  This page discusses the properties of agents in a complex adaptive system (CAS). 
It then presents examples of agents in different CAS.  The examples include a computer program where modeling and actions are performed by software agents.  These software agents are aggregates. 
The participation of agents in flows is introduced and some implications of this are outlined. 
agents
.  The architects additionally perform the genetic operations on the current schematic structures. 

Our concept of a schematic plan would reside in the minds of the designers and architects.  The ideas in the plan have been
Plans change in complex adaptive systems (CAS) due to the action of genetic operations such as mutation, splitting and recombination.  The nature of the operations is described. 
selected by academics and engineers from the pooled schematic set
.  As such the task structure and design structure seem like phenotypic representations of some of the ideas that are associated with the core schematic structure.  Much like a printed chess game move sequence is a limited reflection of the ideas that were driving the player's moves during the game. 

Design rules, such as the adoption of micro programming, and standardization of circuits by inversion, are
Rather than oppose the direct thrust of some environmental flow agents can improve their effectiveness with indirect responses.  This page explains how agents are architected to do this and discusses some examples of how it can be done. 
indirections
that generalize the associations of schematic goals. 

The architecting of the task structure was supported by a discussion of Microsoft's windows 3.1 development.  From personal experience the attractiveness of a windows PC is personal computer
depended on applications that would provide the users with ease of use and value, and a hardware platform that provided all the services that the applications required.  There were two inhibitors to windows deployment: 
  1. Prior versions of windows were running on hardware that could not provide the OS with required features of a windows environment, so the applications were very constrained.  But more significantly,
  2. The major PC is personal computer
    application developers such as Lotus (spreadsheets) and various word processor developers were having to target MSDOS, IBM PCDOS, IBM PS2/OS2 (OS/2 being developed for IBM by Microsoft) and Microsoft's Windows.  IBM, inexplicably, put Microsoft in a
    The position and operations of different agents within a complex adaptive system (CAS) provide opportunities for strategic advantage.  Examples of CAS agents leveraging their relative positions are described. 
    unique position
    to
    Flows of different kinds are essential to the operation of complex adaptive systems (CAS). 
    Example flows are outlined.  Constraints on flows support the emergence of the systems.  Examples of constraints are discussed. 
    limit progress
    of all the application developers who were initially focused on IBM's OS2 while Microsoft developed a port of its application suite Word, Excel, and PowerPoint. 
Microsoft's application suite was ready in line with Windows 3.1 as were a number of new high powered hardware platforms that were built by companies interested in limiting the market share of IBM's PS2 with its proprietary Microchannel.  A virtuous circle drove Microsoft into a position where it could gain further positive economic returns, W Brian Arthur's conception of how high tech products have positive economic feedback as they deploy.  Classical products such as foods have negative returns to scale since they take increasing amounts of land, and distribution infrastructure to support getting them to market.  High tech products typically become easier to produce or gain from network effects of being connected together overcoming the negative effects of scale.  

Typically genetic operators will leverage a
This page reviews the implications of reproduction initially generating a single child cell.  The mechanism and resulting strategic options are discussed. 
single-cell developmental bottleneck
to initiate the new organism.  That ensures that the schematic plan will be consistent across all cells in the eventual system and will not be immediately impacted by overpowering
This page reviews the inhibiting effect of the value delivery system on the expression of new phenotypic effects within an agent. 
extended phenotypic alignment
.  Baldwin and Clark observe that by having the design rules and splitting operator create true information hiding, modules can also be re-architected by genetic operation.  There seems more required to obtain this property than just this assumption. 

The module architects they are depending on are assumed to be free to follow their own plans, and hence can introduce their own design ideas within 'their' module.  It seems more likely that extended phenotypic alignment is being enforced through the coherent education of engineers, and the open access to
Tools and the businesses that produce them have evolved dramatically.  W Brian Arthur shows how this occurred.
designs and tools of a networked combinatorial cluster
that all the engineers are focused on because of the
This page reviews the strategy of setting up an arms race.  At its core this strategy depends on being able to alter, or take advantage of an alteration in, the genome or equivalent.  The situation is illustrated with examples from biology, high tech and politics. 
evolutionary amplifier
of object code compatibility with the user's computer platform architecture.  As such a new species has been formed earlier, prior to the developmental is a phase during the operation of a CAS agent.  It allows for schematic strategies to be iteratively blended with environmental signals to solve the logistical issues of migrating newly built and transformed sub-agents.  That is needed to achieve the adult configuration of the agent and optimize it for the proximate environment.  Smiley includes examples of the developmental phase agents required in an emergent CAS.  In situations where parents invest in the growth and memetic learning of their offspring the schematic grab bag can support optimizations to develop models, structures and actions to construct an adept adult.  In humans, adolescence leverages neural plasticity, elder sibling advice and adult coaching to help prepare the deploying neuronal network and body to successfully compete. 
modular splitting operation.  Selection seems to be occurring in the market and designers would typically respond by alignment.  With cloud computing currently separating the user and computing platform less modular alignment may be present going forward. 

The exact strategies that were responsible for the IBM System/360 success are contentious as a comparison of chapter 7 and 8 of Design Rules with Delamater's alternative narrative demonstrates.  It is clear that programmed computers followed positive return economics based on the network effects of machine instruction sets on software application availability.  That allowed the market leader, IBM, to create a huge fixed cost barrier for competitors. 

The system 360 may have attained a modular design, but the implemented offers, and their architectural specifications allowed IBM to reposition the features within the overall system.  Plug compatibility was made hard to sustain. 

The impact of modularization on the testing process is to create a focus on module-level tests since these can reduce the combinatorial explosion that otherwise occurs in system testing with various modular options.  Indeed in our experience shared module level tests and infrastructure are required proof points of the modularity. 

DEC's success with its early computers was undoubtedly shaped by the effect of IBM on the computing market.  However, the enforcement of
This page discusses the potential of the vast state space which supports the emergence of complex adaptive systems (CAS).  Kauffman describes the mechanism by which the system expands across the space. 
competition rules
by the US is the United States of America.   Government seems as significant as the use by DEC of substitution, augmentation and exclusion operators.  Other competitors made alternative design selections.  IBM avoided many strategies that had constrained earlier competitors in case they be viewed as monopolistic.  The situation seems akin to the operation of the immune system has to support and protect an inventory of host cell types, detect and respond to invaders and maintain the symbiont equilibrium within the microbiome.  It detects microbes which have breached the secreted mucus barrier, driving them back and fortifying the barrier.  It culls species within the microbiome that are expanding beyond requirements.  It destroys invaders who make it into the internal transport networks.  As part of its initialization it has immune cells which suppress the main system to allow the microbiome to bootstrap.  The initial microbiome is tailored by the antibodies supplied from the mother's milk while breastfeeding.  The immune system consists of two main parts the older non-adaptive part and the newer adaptive part.  The adaptive part achieves this property by being schematically specified by DNA which is highly variable.  By rapid reproduction the system recombines the DNA variable regions in vast numbers of offspring cells which once they have been shown not to attack the host cell lines are used as templates for interacting with any foreign body (antigen).  When the immune cell's DNA hyper-variable regions are expressed as y-shaped antibody proteins they typically include some receptor like structures which match the surfaces of the typical antigen.  Once the antibody becomes bound to the antigen the immune system cells can destroy the invader. 
.  Alternatives coded for schematically are able to cover a vast set of alternative antigens has to support and protect an inventory of host cell types, detect and respond to invaders and maintain the symbiont equilibrium within the microbiome.  It detects microbes which have breached the secreted mucus barrier, driving them back and fortifying the barrier.  It culls species within the microbiome that are expanding beyond requirements.  It destroys invaders who make it into the internal transport networks.  As part of its initialization it has immune cells which suppress the main system to allow the microbiome to bootstrap.  The initial microbiome is tailored by the antibodies supplied from the mother's milk while breastfeeding.  The immune system consists of two main parts the older non-adaptive part and the newer adaptive part.  The adaptive part achieves this property by being schematically specified by DNA which is highly variable.  By rapid reproduction the system recombines the DNA variable regions in vast numbers of offspring cells which once they have been shown not to attack the host cell lines are used as templates for interacting with any foreign body (antigen).  When the immune cell's DNA hyper-variable regions are expressed as y-shaped antibody proteins they typically include some receptor like structures which match the surfaces of the typical antigen.  Once the antibody becomes bound to the antigen the immune system cells can destroy the invader. 
.  Specific antigens then bind with any close matching alternatives.  Our point here is that again the system was unpredictable and the selection outcomes were not controlled by its designers choices. 

Clayton Christensen's interest in his DEC friend's innovation is the economic realization of invention and combinatorial exaptation. 
dilemmas resulted in his study of the disc drive industry.  He explains how the pressure of
This page reviews the inhibiting effect of the value delivery system on the expression of new phenotypic effects within an agent. 
extended phenotypic alignment
was only avoided by IBM, with its market share based business model, at each new phase of the industry.  All other participants were replaced by new competitors due to the
This page reviews Christensen's disruption of a complex adaptive system (CAS).  The mechanism is discussed with examples from biology and business. 
disruption from their profit oriented business models


On reflection
This page reviews the implications of selection, variation and heredity in a complex adaptive system (CAS).  The mechanism and its emergence are discussed. 
Darwinian
and modular evolution do not appear so different. 

Successful iterative approaches to design are known.  Both the IETF process and Linus Torvald's process to create the linux kernel, capture the conclusions of engineers and academics operating in the target domain.  The deep knowledge was used creatively to initiate the development of an expanding set of 'open' schemata and iterative processes that instantiate the schemata, and deploy the implementations competitively in markets.  While Baldwin and Clark argue for structural modular alternatives to iterative design and suggest that they generate modular industry clusters with very low transaction costs, Lou Gerstner's
Lou Gerstner describes the challenges he faced and the strategies he used to successfully restructure the computer company IBM. 
analysis of future computing trends
appears to disagree.  Williamson argues that corporate structures provide a low cost solution for complex interconnected transactions -
Lou Gerstner describes the challenges he faced and the strategies he used to successfully restructure the computer company IBM. 
IBM's strategy


The assumption of a normal distribution of economic values seem risky.  As in economics the agents of design are human.  Their adaptive strategies and
This page discusses the effect of the network on the agents participating in a complex adaptive system (CAS).  Small world and scale free networks are considered. 
network structures
encourage the formation of power law distributions.  Baldwin and Clark's use of options and portfolio theory thus seems to suffer from the same problems as normal distribution based quantitative strategies in economics.  


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integrating quality appropriate for each market
 
This page looks at schematic structures and their uses.  It discusses a number of examples:
  • Schematic ideas are recombined in creativity. 
  • Similarly designers take ideas and rules about materials and components and combine them. 
  • Schematic Recipes help to standardize operations. 
  • Modular components are combined into strategies for use in business plans and business models. 

As a working example it presents part of the contents and schematic details from the Adaptive Web Framework (AWF)'s operational plan. 

Finally it includes a section presenting our formal representation of schematic goals. 
Each goal has a series of associated complex adaptive system (CAS) strategy strings. 
These goals plus strings are detailed for various chess and business examples. 
Strategy
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This page uses an example to illustrate how:
  • A business can gain focus from targeting key customers,
  • Business planning activities performed by the whole organization can build awareness, empowerment and coherence. 
  • A program approach can ensure strategic alignment. 
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