Should I grow the type of work by adding a new specialty, add more consulting talent, think about acquiring another firm or its assets, merge with a similar but more established good firm like Chasm, and the list goes on. The choices are many. People — clients, other CEOs, jealous grad-school buddies seeking a job — have approached me for years to ask the “when are you getting bigger?”, “are you growing fast enough?”, “You’re still just 6 core people, how do you plan on growing?”, “When will you begin to really grow the company?”, “Why have you decided not to grow the company?”

For the first 7 years of Rubicon, I would probably mumble something in the hopes they heard what they wanted to, and would simply stop asking. I had no idea what size was “good”, whether we were “big enough” etc. Uggh, what a question! It’s equivalent I would think to being asked by others “when are you going to have another child?”. Yes, you have one but certainly you want more, is the inference. You must want more.

Now, in year 8 of leading Rubicon, I have an answer.

Well, I have a directional answer.

At the root of the question is what is right size and growth strategy for the company. People assume our size is not right. I get the perspective that many, many people believe that bigger is better, yet frankly I’m not convinced. No man-related joke here, but sometimes bigger is not better.

Here’s my answer to the question: I want to grow without “growing”

What that means to me are things like this:
I never want to get so big that we take work for the sake of work.
I want all of Rubicon-ites to have a real joy and passion for what we do. The people who are here have to really love and really get strategy at the deepest level. I want our customers to get a group of people who like this strategy stuff enough to keep doing it for a while. We're not just looking for the next gig or looking to land a gig at one of our clients.
I love the idea that when a client needs us again, we can effectively have enough context so we can add more value. We need to price and build the business so we're around for round II of the market expansion plans.
I want us to keep advancing what we can offer. But not about "more". Rather than doing more, I want to keep finding ways so we keep adding loads of value (and offload stupid costs).
I want to leverage the best of talent, every where.
I want our customer depth of relationship as well as base to keep growing.
Certainly, I want our revenues to keep growing. Because our value-add is growing.
I always want our customer satisfaction to stay high and if possible, grow!
I want us to create the right impact at the company, division, industry and perhaps even the personal level -- such that they achieve the transformation they were seeking towards their goal.

I've intentionally set up our business so our headcount doesn’t need to grow linearly with our key business deliverables. We’ve been finding key parties that can help us scale without losing quality. We’ve been streamlining all the places in the business so we don’t waste our time and ask clients to pay for it. We make things clearer, simple, and thus we eliminate headaches on all sides. I want that to continue.

Our partnerships are growing. I wish I could announce a few but it always takes longer than I’d like. By setting up partnerships, I’m making sure to vet the right solutions and then do good handoffs to people who can really deliver with their model the highest value. There's a firm out there than can create scalable readiness inside a firm by training and advising them to have one framework on how product management is done. That firm is one I want to highly recommend and leverage.

We could hire "business development" people to focus on the revenue side, or we could simply continue to deliver unbelievably strong strategy and ask our base of clients to refer us to people like them. I don't want to spend in marketing or sales. I want to focus on doing great work and creating advocates. Passionate customers who really get the value we created for them will get us where we need to be. Create delighted customers and this will yield to great value over time, not just a quarterly or annual blip. And I would recommend that -- if you are building a business -- you realize you are going to make a series of choices about what is "enough" and what makes you "successful". My advice: It's important to distinguish the point of value-add and then to stay true to it.

Let's be real about the tension all this creates. Do we need more people today? Absolutely. We could use another person or two right now, with a couple new capacities I'd like to see on our core team. But it's okay to be stretched. At this point, you're on the edge. And, the edge is where you are forced to be creative. It’s where your decisions are sharper and more informed. You make calls because you have to, not because they are convenient. “We can’t do this right now because that is more important.” Being at the limit forces you to think about value and we think that’s a great place to be.

It would be a little flippant to say I want to be the best in the category. And at one level it's true. But it doesn't capture the essence of we're seeking.

This is the kind of growth I want: The kind that builds and maintains great value in the world. Value not just in money but in relationships, in the quality of ideas -- the things that people remember for years and years. Enduring value kind of growth.

Hope your New Year is off to a great start.

Here's a great example: The online whiteboard. It's a well designed and executed idea that lets the brand tag "imagination at work" actually become real. You can go to the site, get a marker, and then draw with friends or colleagues or anyone. You can save it, send it, etc. So you have a reason to capture an idea and then use GE to share that idea.

Good job GE!

Technorati Tags:
GE, Online, Web Marketing

We want it, and we want that process to continue to raise the caliber of what is created, and the value it offers. But there is one rule that allows that level of innovation, and that is the rule of when there’s a winner, there’s a loser.

There are several companies out there facing their Netscape Moment. No, not the crazy every-one-who-matters-wants-to-work-here and were going to make a $1M for each day we show up to work insanity. But the day that MSFT announced they would enter the category, and Netscape never recovered. They lost their mojo, and along with it the market.

When we talk about competition in the pristinely clean halls of offices, we reduce it's value and effect in high-tech. We think about it like there's dollies and high tea will be served soon. But we've got to start thinking of competition, people as a bar-fight. There's one winner, and one loser and you better get in the fight if you expect to win.

Why, might you ask am I writing this on a Friday afternoon. Frustration, that's why. I see companies thinking that "there'll be time" and it's people who haven't seen the truck slam up side the car to see the kind of destruction that will happen. They weren't perhaps around and paying attention when Netscape and all the good people who worked there lost their mojo. Sometimes the thing an operational background gives you is perspective.

Vmware is facing a battle equivalent to the Microsoft-Netscape battle of today. They have virtually created (pun intended) the virtualization category yet they’ve done it in a way that no one has an allegiance to create more market momentum in that direction. They’ve also created the category without making sure they are the rightful beneficiary of the category growth. This, while notable and worthy in the category of innovation is like spending money to water the neighbors yard and not your own. It makes the neighborhood look good but doesn’t build value in your own real estate. To overcome this, VMware needs to change approach. They need to become a brand bulldog. Picking their turf carefully and then defending it with the tenacity of a junkyard dog guarding his bone. Forget about parity and go for distinction. Get clear on your brand position and make sure everyone in your company knows it and can articulate it. Make sure however you define your offer is truly unique and you can lay claim to it, you have a way to fight differently. Customers want you to articulate why they need to follow you. Go VMWare, Go. And get rid of the gloves. This is a street fight.

Which leaves me with a question for all of you -- are you prepared to fight for your competitive ground? How so? Let me know...

Technorati Tags:
VMWare, Microsoft, Netscape, Competitive, Strategy

And I think Google may be trying for this trifecta solution.

Google has been making forays into the SMB market of course, trying to take the low end of the enterprise space as they attack Microsoft on the underbelly. SMBs, a largely unpenetrated market, has been a “holy grail” for many enterprise technology firms: greatly desired, often sought after but not obtainable. and you've heard me talk / blog about how the Web has placed the ever-elusive SMB market within the grasp of software companies. This wee thing called the web allows firms to leap over former barriers included poor distribution vehicles, and the large advertising investment required to build brand awareness, and an inability to affordably target SMB segments. So it makes p-e-r-f-e-c-t sense that Google, the one who practically created the ability to do broad reach go to the SMB market and serve them with online apps, etc.

With the recent acquisition of Postini (for $625M for its 35K customer base) they got two things. Security surely, and a “scalable architecture” based on the press release. I have no idea what that means but I’ll buy it for now.

So that gives Google, on the face of it at least, 2 of the 3 things enterprises need: security, scalability and support.

And then, a few weeks ago, Ingram Micro signed a deal with Google.

Put that together folks. Ingram Micro -- old school and Google -- new school, got together and talked about doing something together. It kind of surprises me a bit to see this move.

So perhaps this is the support model. Not because I don’t think Google couldn’t build a channel (they seem to be able to do anything with their nearly endless supply of talent and capital) but it seems contrary to who they are, doesn’t it? Google has built a company based on no-touch, and thus my team mates and I at Rubicon sometimes call Google the 6 letter word for “no-support” as if we were part of a NYT crossword puzzle answer. But, hey, let's be real support is not in the Google model. So when their blogger technology goes down and doesn’t come for a few days, hey stuff happens. It's free, what more do you want?

SMBs like many markets need some hand-holding. And that support gap represents a great opportunity for the channel to come in and make sure the full solution is complete. So the move with Ingram seems some evidence that will embrace the channel. But, hmmm. It just don’t feel right. Maybe it’s that I know how many companies have done the Ingram PR announcement only to “not get” the channel. I remember winning an award from VAR business when I worked at Apple. It came with a letter that effectively said, “we, at VAR business, are surprised to find you guys pulled your head out of your a** and so give you this award.” It was funny then, it’s funnier now. It’s that SO many vendors do it badly, that its just practically amazing to see a fully integrated plan that allows the channel to be an extender of a strategy that includes the total picture.

Time will tell if Google is serious about offering support through the channel. This will be an interesting one to watch.

Technorati Tags:
Market Expansion, Google, SMB, Postini, Channel

Marketing is no longer considered contributing to the corporate performance of a company; not in any strategic kind of way. It hurts to think of this profession that I value, I respect and I know can be a key driver of growth as well as bottom line profits has come to this. It can be turned around, and it should but to get there from here, is going to take a revolution of sorts.

Instead of Marketing (the big M kind) being a strategic thrust with a clear charter, marketing within a company has become much like the children’s game of telephone. In this case, knowledge regarding customer needs is diluted on its way from idea to product or service. Organizations are not tapping the power of their customers—and what knowledge they do have keeps leaking during the process. Decisions that drive fundamental profitability and competitiveness are distorted by this game. The inefficiencies in the traditional marketing process show up in many ways. One of the most insidious is that downstream groups don’t trust the information and insights gathered by upstream groups. In severe cases, they may not even understand or receive such data. As a result, research is repeated and insights are lost. Companies incur higher costs from duplicated effort, yet operate on fewer real insights. Ugggh, it's a mess.

IS THERE A PATH BACK?
If Marketing continues on its current vein, then it’s quite possible it’s not appropriate to have it belong to the C-Suite. It could be that Marketing will become a function of Sales, just creating a services organizational aligned to drive revenue activities. Or it could be that marketing will move towards a business unit operations to make sure the business unit goals are arrived which include brand positioning as well as sales activities and perhaps some product PR thrown in.

But if the CMO role is going to become a contributor to the bottom line, a fundamental shift of things must be done. What are those things?

WHAT MUST BE DONE?
I am going to assume for a minute there is significant untapped value in this c-level role, and look at what can be done. With a focus on what must CEOs and CMOs do to make the role relevant, and a contributor to the bottom-line.

3 things that could cause the necessary turnaround of this role, and my thoughts for what “the answers” are.
1. Framework. We collectively need to redefine the architecture for the role and specifically define what is its role in the company.
2. Connecting the Pieces. What are the interdisciplinary pieces that form the value chain and what can be done to connect it.
3. Create ownership of something. If CIOs own the infrastructure support, CFOs own the overall bottom line, Sales owns the topline, CEOs own the vision thing, what does the CMO own? I have a proposition for it.

FRAMEWORK: The role.
First, we need to establish a framework for what the role is. Is it as some companies define the role of marcom service, or in other places the lead PR role, or is it the customer voice into the company. In other words, marketing can be a combination of product management, product marketing, field marketing and brand and it’ the only place in a company where a functional thing is cut up into pieces and then spread throughout the organization. It’s almost as if we’re afraid of what would happen if all the pieces were to stay together. With out a common defined job description and clarity of what is in or out of that bucket, the success criteria can never be developed nor can we achieve new levels of achievement.

I’m going to suggest that the CMOs role is much like the role of a quarterback of the football team. They should have the process skills to know what the company needs and how it works enough to navigate the natural market evolutions the company needs to go through. 2nd they need to know the product; what it is, what it could be so they can figure out how to provide the full range of marketing onto that story whether it be personality marketing, market and competitive positioning, value proposition communication, etc. 3rd they need to know the market and the latent customer desires so they can help “guess” what is going to be next and what the company needs to be considering for the next phases of evolution. And what a mix that would be: market, process and product savvy. Marketers, at least the best ones, tend to actually have that mix but have been somehow focused ot be incredibly process centered. That’s why I see this big “ROI” focus in every CMO council group that exists. ROI is what you focus on when the CEO has no confidence that you’re contributing enough to the bottom line. It’s a decoy that is distracting the marketing leadership from playing the role they need to play which is to bring together the interdisciplinary aspects of the business views much like a quarterback does to a football team – and thus creates a winning formula that leverages all parts of the organization.

Value Connection: the need to connect the pieces.
The interdependent groups of product marketing, product management, field marketing and brand are part and parcel of the different ways a product is both created and sent into the market. Using the football analogy again, these interdependent groups play with each other and for the company; they are one team even though the skirmishes on the field may not look like that. These roles comprise the key set of knowledge-based activities that connect customer needs and knowledge back into the company. They are the biggest source of un-optimized activity in most firms.

Therefore, we need to create a marketing value chain much like supply chain management. Unite tactical parts of the company that are disconnected, we need to unite the pieces into a strategic and cost-saving initiative. Related to this, we need to address the knowledge efficiency of marketing: product management, product marketing, field marketing and brand management.

Finally, use marketing value chain management to control the entire marketing chain, from product requirements to product marketing right through to sales and customer care. Just as supply chain management addressed specific, measurable goals, marketing value chain management has three primary goals:
1. Increase competitiveness by increasing the relevancy of the solution (this can be both near-term and far-reaching).
2. Increase sales by being better positioned and understood
3. Increase gross margins by lowering the amount spent on messaging, research and headcount

Ownership: own something.
The revolution is waiting for CMOs with vision and leadership ability – but in order for them to have a relevant seat at the table, they’ve got to own something. Something tough. Just like sales owns a number, and the CEO owns the vision, the CMO has to own a piece of the major pie on something as important and perhaps as intangible.

And if I search under the many things that are published and discussed in the starbucks remote offices, I can see that CMOs today own very little or at best, own pieces of a total solution. They might own a qualified leads # in support of enterprise sales, or a particular rate of return on marketing spend. But is that owning enough to qualify for a seat at the table.

By owning something, there’s got to be more at play. More intuition and less process. More skill and less detail. And it’s gotta matter.

And so here I go with a crazy idea. I’m going to propose that the Chief Marketing Officer (in the role I’ve defined above) is going to fundamentally become a contributor when they own the customer. They need to own everything that makes that customer experience. Everything. They need to have services repot to them because they need to be accountable when the promise isn’t kept. They need to own the product management requirements in case what is built isn’t right. And then they need to own what is used to communicate to and with the customer so that total picture of “what they need” to “what we say” and including “our interactions with them” is about the CMO. The CMO needs to become that crucial to the business. Because without it, there’s someone not represented at the C-Suite and that’s the customer. Currently they are owned by everybody and thus nobody. How about we make someone really good at owning the customer and then make them create the inside game to run the field and score a touchdown on behalf of a customer.

That’s a role worthy of the C-Suite. But it’ll take a revolution to get from here to there. I look forward to being a part of it.

Technorati Tags:
marketing, Leadership, Business, CMO

Jeffrey Swartz, the CEO of the Timberland Co., strode purposefully into a New York office packed with McDonald's executives. Dressed in a blazer, jeans, and Timberland boots, he was there on this mid-August day to convince the fast-food behemoth that it should choose his $1.5 billion shoe and clothing company to provide its new uniforms. The executives waited expectantly for him to unzip a bag and reveal the sleek new prototype.

"We didn't bring any designs," Swartz said flatly. Eyebrows arched. Instead, he launched into an impassioned speech that had virtually nothing to do with clothes or shoes. What Timberland really had to offer McDonald's, Swartz said, was the benefit to the company--and the world at large--of helping it build a unified, motivated, purposeful workforce. "Other people can do uniforms," Swartz said, his Yankee accent asserting itself. "This is about partnership. We can create a partnership together that will be about value and values."

Compare that to this story:

The chief executive of Whole Foods Market posted messages on a Yahoo chat forum under an alias for years, talking up his own company while predicting a bleak future for Wild Oats Markets, the rival it has since sought to acquire.

Company CEO John Mackey posted messages on a Yahoo financial forum under the user name "rahodeb," according to a court document filed by the U.S. Federal Trade Commission and postings on Yahoo.

The spin he tries to put on it in recent news over the weekend is almost pathetic. “I was just having fun.” Suuure, posting to a Yahoo Finance website just for fun. He had no idea he might, uh, move the stock? And, seriously, doesn't he have something better (anything?!) to do with his life?

Uggh.

Which company would you invest in?
Which company would you select to work for?
Which company brings the leadership qualities that will leader to a sustainable advantage?

I know my vote. Do you?

Technorati Tags:
Leadership, Authentic, Whole Foods

There are typically 4 “C” Level positions at a company: CEO, CIO, CFO, and CMO. 3 of those have a high rate of influence in the board room and at the E*Team. One does not.

Perhaps this statistic will be revealing. The average Chief Marketing Officer (CMO) only lasts 23 months on the job (See June, 2006 Spencer Stuart study in Brandweek: Length of CMO Tenure Continues Decline). CMO job tenure has been moving in a downward spiral for several years. Think about that. 23 months is not even 2 years. Not enough time to influence more than 1 planning cycle, and certainly not enough time to influence a long-term direction. Which I would think a “C” level person should do.

In contrast to CMO turnover, the Spencer Stuart study revealed that CEOs average 44.4 months on the job; CFOs 39.4 months and CIOs last 36.4 months. So a CEO which has many interrelated functions to manage is given nearly twice the run way of a CMO.

This factoid is actually one piece of a much larger issue at hand. And it represents a crisis of enormous proportions.

The marketing discipline needs a revolution. And it’s coming at a dear cost. Pricing, perhaps the point at which value is either lost or gained is not maximized because value has not been (a) built due to lack of customer insights, (b) or, not communicated in meaningful terms, and thus useless, or (c) not credible given the company’s brand or position in the marketplace.

Rather than being a strategic thrust with clear charter, marketing within a company has become much like the children’s game of telephone. In this case, the knowledge and insights regarding customer needs are diluted and distorted on its way from idea to product or service. Organizations are not harnessing the power of their customers—and what knowledge they do have keeps leaking during the process. Decisions that drive fundamental profitability and competitiveness are distorted by this game. The inefficiencies in the traditional marketing process show up in many ways. One of the most insidious is that downstream groups don’t trust—or perhaps don’t understand or receive—the information and insights gathered by upstream groups. As a result, research is repeated and insights are lost. Companies incur higher costs from duplicated effort, and yet operate on fewer real insights.

We are not talking about hypotheticals here. Smaller firms are often able to out produce larger firms in terms of internal marketing efficiencies. Understanding and acting upon customer insights and avoiding leakage between concept and delivered product is what successful small firms do well. Small firms, however, often run into growth ceilings with regard to external efficiencies such as sales, distribution and the ability to generate buzz. Smaller firms have less leakage and distortion because they have fewer people involved in the process so they act as a more cohesive unit. The challenge is figuring out how to manage the marketing process in larger organizations so that they can compete against smaller competitors.

Jeff Hawkins and Palm are a great example. Jeff had an insight into what consumers really wanted. He did not offer the first PDA, but the original PalmPilot 1000 was different: it fit in a shirt pocket, it had handwriting recognition that worked, and it ran for weeks on two AAA batteries. It did not even try to be a “portable computer.” The product was well-designed, the functionality was limited, but focused appropriately, and the messaging was tight, realistic and believable. Jeff’s vision was clear and shared by Donna Dubinsky who ran marketing so it was executed throughout the marketing value chain, although they certainly did not call it that.

As Palm grew and generated more competitors, especially Microsoft’s PocketPC, Palm’s greatly expanded organization responded with bloated products that competed with long list of features. The battery life dropped, the messaging became less focused, and Palm lost its commanding market position.

What is going on?

There are 4 reasons why marketing has been distorted.
1. The charter of marketing is murky.
2. CMOs want high impact but pay a lot of attention to shiny objects.
3. Marketing is run as disparate functions with no clear owner.
4. The must-wins are unclear.

Lets explore each one of these, shall we?

1. Charter of marketing is murky.
While few people in most firms really understand the specifics of engineering and R&D, they all know what engineers do: they build stuff, invent stuff, improve processes, etc. By contrast, very few people can articulately explain what marketing does—and this includes most marketers and the CEO. In far too many people’s minds, Marketing is associated with t-shirts, PR, lame sales tools, brochures and the people who want to change the logo every couple of years. Great quote that captures what many of my clients would say:

“Marketing owns nothing but influences everything” is a phrase I’ve heard many times in my career”

And marketing people are viewed as doing “soft stuff” while the engineers, finance folks, IT and CEOs “lead the big stuff”. Alrighty then. These are fighting words. But then as I look at it, marketing really is not assigned one or two major objectives, is it? I checked around with CMOs I know and the issue is that they own “supporting” the major companies objectives but not directly owning anything.

As long as the question of what marketing owns is unclear, the role of marketing executives will never be successful in the long run. The marketing organization needs to have a few key metrics defined, then consideration needs to be put in place how long should it take to influence that objective.

And then here’s the final rub. Marketing is caught between product management / engineering who makes the stuff and sales who sells the stuff. When sales isn’t getting what they need from “corporate”, they turn to their marketing teams and when things are missing, they blame marketing. A situation in the last year I’ve had a chance to witness is when sales didn’t have the things they needed for a SMB market place push, and they blamed marketing. The reality is that that marketing didn’t have the content to create what sales needed, but it came across as a pointing the finger thing. On the other side, BU heads and folks who run Engineering think that marketing is adding little to no value as they focus discussions on budget – and so they focus on the amount of variable budget the marketing team has to spend.

And as a result, regardless of the goodness and talent of many CMOS, a great many are going to end up on the chopping block. I would argue until the category of CMOs get together and reform their role, no CMO is going to be successful.

2. We want high impact but we respond to shiny objects and silliness
CMOs are chartered with many things. Many, many things.

“Despite the importance of the marketing function, it isn’t uncommon to find, when you move to a new company, that some of the key executives won’t truly understand the role of marketing and, as a result, expectations between the marketer and those executives aren’t aligned,” explains Carter Cast, CMO of Walmart.com. “For example, the marketer may want to better understand the customer purchase experience by digging into customer service issues, only to find that other executives might question why he or she is doing that. To some executives, marketing might just be defined as advertising or marketing communications.”

The very word “Marketing” can mean anything from “product requirements” to “sales tools”. While few people in most firms really understand the specifics of engineering and R&D, they all know what engineers do: they build stuff, invent stuff, QA product, and make the stuff that ultimately leads to revenue, etc. By contrast, very few people can articulately explain what marketing does – and this includes most marketers and CEOs. In far too many people’s minds, Marketing is the stuff of logos and advertisements. Advertising, while costly and visible, is one tool of a many varied toolkit.

So while any CEO I know wants “high impact”, the actual thing they hold the CMO accountable for is something short of that.

As Ben Kline, the new CMO for Leo Burnett, explains, “many companies are asking the CMO to be the ultimate change agent, yet most aren’t prepared to give the new marketer enough time to be truly effective. The best situations are when the companies’ senior most leadership paves the way for the innovative thinking of the new CMO. In order to be successful, an entire cultural shift needs to be unveiled in unison with the newly appointed executive.”

A dinner with a colleague who is running a part of HPs branding has recently “been told” by the GM of the division that their team needs to have an “ad campaign like the PC group does”. And there were no metrics of revenue attached to this task but a need to ‘keep up with the coolness factor” of the PC dvision. And then they wonder why marketing gets chasticed for being “tactical”.

3. Functionally, marketing is run as disparate functions unlike any other parts of the business.
Most CEOs are not ignorant of marketing, but rather they have little knowledge or appreciation of how the individual marketing functions interact and function together. Thus, when something is going wrong, they cannot participate in its resolution. Lastly, we need a complete transformation of the way the organizations are lined up. Marketing has a “matrixed” or complex reporting relationship. When asked whether they have the resources to do what they are tasked with reporting to them, most laugh. Marketers are expected to “influence” the other parts of the organization for alignment. Does engineering need to do this to make their objectives? No! So of course the deck is stacked against CMOs.

First off, in many firms, no one person owns the entire marketing organization. Sure, there is almost always a “VP of Marketing,” but this person frequently does not have responsibility for all four marketing functions. In some organizations, Product Management reports to Engineering or Product Development. In other organizations, Field Marketing may report to Sales, or Brand Management may report to “Corporate Marketing,” a function that is generally run and populated by PR types rather than marketers. In organizations where the marketing functions are split, they may not come together until a Senior VP with lots of other responsibilities, the President, or even the CEO. I can guarantee that very, very few of these senior executives are looking at and managing marketing as a single value chain of inter-related functions.

Another factor in the fragmentation of marketing is that all of the functional areas do not share a common vocabulary and the communication between functions is often problematic. Imagine playing the game of telephone, but where they players are using job-specific jargon.

4. The must wins are unclear.
Finally, the lack of coordination means that marketing wide “must wins” are not clearly understood. Activities like pricing which are incredibly important are treated as a black art or simply as impenetrably complex. Downstream groups either don’t get—or don’t trust—information and insights from upstream groups, so costly and time-consuming research is repeated and knowledge gaps are not well understood. The result is that customer wins are easy to measure, but the more informative customer losses and risks to the business are not studied, much less measured.

What is the underlying root cause?
There is no ownership of the full value chain. A CMO at any company doesn’t own all marketing. They don’t even own the vision for the market. They own parts of the pie that are partly owned or eaten by other parts of the organization.

The vision for the market is not often owned by the CEO. Each piece reports into the different functional focus. And the must wins are unclear or not clearly understood across the organization. Activities like pricing which are incredibly important are treated as a black art of simply as impenetrable. Downstream groups either don’t get – or don’t trust – information and insights from upstream groups, so costly and time consuming research is repeated and knowledge gaps are not well understood. The result is that customer wins are easy to measure but the informative customer losses and risks to the business are not studied much less measured.

What must CMOs do? What must CEOs do?
So what can be done?
What must CEOs and CMOs do?

First, we need to acknowledge the role these interdependent groups have on each other and for the company. These roles comprise the key set of knowledge-based activities that connect the customer needs and desire back into the company, and are the biggest source of un-optimized activity in most firms. I propose we need to create a Marketing Value Chain much like supply chain management united tactical parts of a company into a strategic and cost-saving initiative. We need to addresses the knowledge efficiency of marketing: product management, product marketing, field marketing and brand management.

I would propose we have a Marketing Value Chain Management is the management of the entire Marketing chain, from product requirements to product marketing right through to sales and the final customer. The marketing roles comprise the key set of knowledge-based activities in most firms, and the biggest source of unoptimized activity. Just as Supply Chain Management addressed specific, measurable goals, the Marketing Value Chain Management would have three primary goals:
1. Increase competitiveness by increasing the relevancy of the solution
2. Increase sales by being better positioned and understood, and
3. Increase gross margins by lowering the amount spend on messaging

Technorati Tags:
Business, Product Management, Palm, CMO

It’s that tight grouping and bond a customer has with a company, a brand.
And every company — small or big — can create it, keep it, grow it or lose it.
Do you know what forms that bond for you and your company? Because that, baby, is the secret sauce of company growth and success.

5 things I think create customer affinity.

1. Quality. The components, and the final product. Does it do what it needs to do and thus create value. In the case of a Bottega handbag, it’s the use of vegetable dyes that causes leather to be incredibly soft, but in the case of the wall street journal it is the invisible resources of great writers and editors who take the time to develop an idea that needs developing.

2. Workmanship. The way stuff is produced ultimately matters.

3. Buying experience. What is it like to buy the product. Is it being sold by a surly teenager, a condescending matriarch or a joyous enthusiast of the product. Look at the Apple retail store vs. The best buy retail shop. Paying about the same, training actually about the same, and yet one experience is clearly screening in people who want to enable a great experience.

4. The post-buying experience. I make a point of saying this because to me it’s just as important as what happens before the credit card is swiped. If I decide I don’t like the color I picked or the whatever, I want the opportunity to come back. Not as a 2nd class citizen because I don’t have new dollars to spend but as a client who has already paid and already shown my commitment. Most of us treat prospects as better than our customers. Do you? I have a cue of what I’ll work on and I always work on current client work before I talk to new people.. And some would argue that that is the wrong priorities for someone who also needs to make rain. But I know that every time I satisfy (or not in case of the competitors), I give them a reason to refer me and a reason to buy us again. I don’t have to worry about replacing that customer. I just need to keep the ones that already love it.

5. How you use market power. Here’s the thing. A company once they really start making it sometimes try and figure out how to “profit optimize”. By hiring lower quality people, or by making things repeatable and losing the Zen of the sales process or some other thing that fundamentally “streamlines” out the special experience of what you have made. One company I know has raised their prices by 500% as soon as they gained category leadership. Whole I commend that at some level, it has to come in balance for affinity. I, for example, throw a thought leadership dinner. Major who’s who people come to it, but the first seats go to clients first. You know why? Because it’s my way of subtly saying thank you for believing in us, supporting us and co-creating with us the firm we’ve become. Without them, we’d not be here holding such market authority and sway. So after you’ve arrived, don’t’ dump the people who helped you along the way. Celebrate them.

But let me challenge that thinking.

If we knew more about our customers or even our prospects, we might change what we product in terms of experiences.

Let me suggest this.
When I google shoes, which I am apt to do, I often get served up sites that help me to buy shoes. But let me propose that this is too limited.

I may not be interested in purchase. I might be interested in a much broader list of things related to how I want to create my experience. I might want to make shoes, design shoes, support others making shoes, show off my shoes, review others' shoes, discover new artists, study the history of shoes and learn more about what is coming up in future seasons. In other words, my experience for anything isn't just about purchasing the direct thing.

And yet most websites, most experiences are focused on a linear path of what companies think I want, or rather what they want me to want.

So when you are considering what the customer experience is of your stuff, think about the potential range of customers' (existing or future) desires:

1. Design
2. Manufacture/ make
3. Discovery
4. Source parts for...
5. Being wished for
6. Selection
7. Purchase
8. Being shown off
9. Discussion / review
10 Resale

I'm not suggesting this is exhaustive. I'm suggesting that this is at least one "top 10" list for a way of thinking about our experience.

This would probably be a great list to think of when designing both products, experiences, and web sites.

Technorati Tags:
Consumer Marketing, Business, Product Management

Well Graham has you and every other corporation in the world covered by providing seven easy steps to becoming a PR darling:
1. Make innovative products.
2. Keep it simple.
3. Create truly memorable ads.
4. Find an enemy.
5. Work the taste-makers.
6. Offer surprises.
7. Put on a show.

Then, Mike Mace, on my team writes back:
This is almost like compiling a guide for how to be the next Einstein:

1. Be really smart.
2. Think up something revolutionary.
3. Win a Nobel Prize for it.
4. Don't cut your hair.

So in the realm of adding something to this (while being not as pithy as those two...)

Here's how to win markets:
1. Choose a market that is "green field" but is interesting and high growth.
2. Create a barrier to entry so no one else can enter it or at least beat you.
3. Make sure the ecosystem works so that momentum builds without doing it all yourself.
4. Develop a product or service that is compelling. And adds value.
5. Iterate product regularly without losing core competency.
6. Get traction and win out alternatives.
7. Make sure to spend enough to monetize the opportunity but not so much you squander money.
8. Optimize price without making your customers seek alternatives.
9. Develop "stickiness" and brand affinity without trying.
10. All the other stuff that business books write. Do that. But only the good parts.

None of this stuff is easy. And every technology guy who starts a conversation with me about "this market is big and there's gotta be an opportunity", I just start to tune out. If it were easy, I'd be outta business. And I'm not outta business because doing this stuff at a practical, operating level is incredibly fun and challenging. Geez, I just love my job.

Thanks, Joel and Mike for the humor and the fun of working with both of you.

Technorati Tags:
Business, Apple, win markets, einstein

Company View:

A company, say yours, has a “home page” where they organize the user experience so users can learn more about the company, its products, its vertical solutions and so on. The idea is based on going from the highest “levels” of content to deeper and deeper levels based on specificity.

And the Customer View:

The customer, instead, goes to Google, types in a search of key words or needs, and clicks through to find the specific data that they were seeking. Sometimes. Sometimes they go elsewhere not even knowing your company offers the just-right thing for them. But I digress. In doing the search, Google is effectively the UI for creating the customer experience of your site and content.

That’s not necessarily what the web marketing team let alone the CMO of any company is planning on, is it?

We marketers expect users to come to our site, but we don’t support creating an experience. Instead we share information. We need to turn our websites into places where we play, learn, engage, build communities, exchange information and ultimately motivate the user to be passionately interested in knowing more and being more.

That's a big task.

But without it, Having Google as your UI is an acceptable outcome.

Technorati Tags:
marketing, Google

My friend is focusing on the consequences of all his choices. And that has created a circle of confusion.

There is a wrong and a right way to make a decision. I'm going to suggest that a right way, is one that is driven by authentic, clear truths. And from what I am learning as I observe many executives, those are not the ones that focus on the outcomes, or consequences to drive the decision.

Instead, authentic decisions need to come from what we can actually influence or control:
- the quality of the process of discernment.
- the quality of the data. Making sure we know just what data we actually need is key.
- our ability to see a vision. We must create from our intuition and imagination a picture of the situation and what can be. Without it, we have no reason to move forward.

Fundamentally, courage is the central piece of what any of us who make consequential decisions must do. We must have the courage to consider all the options regardless of risk and then carry out the decision. Regardless of the outcome. Holding onto the outcome means we are trying to control that which isn't ours to control.

Being a CEO myself and then working with execs across so many firms, I see so much decision making that is trying to avoid layoffs, or ensure job satisfaction for a team, or confirm a deal WILL happen. But making a decision solely focused on those outcomes is both harder than it needs to be and inauthentic.

I'm co-leading a silent retreat for CEOs in about 8 weeks. I think this will be part of what we reflect on.

Marketing has many elements, of course. There's:

- inbound marketing which helps define customer requirements into the technology group, or
- product marketing that makes sure the product is well positioned with a clear value proposition, or
- corporate marketing which does some brand and pr “aircover”,
- and field marketing which helps generate leads.

So when I say marketing, I'm using the big "M" of marketing; all of these pieces that connect the user interest to the product technology.

And it's with that context that I want to take a look at HP’s recent campaign of “Computer is Personal Again”. I’m not sure how many of you have been paying attention to it. Actually, I’m wondering how long ago you have started to tune out. It’s been in every major magazine (Wired, Fast Company, Business 2.0, Fortune, Forbes), daily publication (WSJ, London Times, etc) and every relevant online website. It even got several articles on the campaign itself. It is by far the biggest advertising expenditure I’ve seen in the tech field since the boom (pre-2001). In case you haven’t seen it, here’s an example:

And then there's this one:

There I just helped create another 2 impressions.

HP: Is the hand really personal?
If money is the measure, it’s clear that HP is trying to do something grand. But the question for me is whether it is working, if it is real, if it will create an enduring value ...

Let’s look at this against some criteria:
1. Does it communicate a solid value proposition?
2. Does it connect with people at an emotional level?
3. Is it Real. Is what the company says really who they are and will the experience of the product / solution / service be that of the “promise”.

Marketing can be defined as all the actions you take to increase sales without lowering the price. This is critical in the PC market, where manufactures have to fight the price game and escape becoming a commodity. How do you avoid this fate? I think they need to relate themselves to a higher value that customers care about and associate it with their product through a compelling story. “The Computer is Personal Again” campaign focuses on the higher value of the personal computer. The advertising claims, “Your personal computer is your backup brain. Its your life and the life of your business.” They go on to say, “Today HP is making the entire experience of owning a computer more personal than ever before. We are designing products that offer you ever greater power, simplicity, and security.” They boldly claim, “When you own a personal computer from HP, you own something more than the right to demand that the personal computer will finally live up to its name.”

Okay. That’s great! I’m in. (am I the only person who wants to fall for these ads?)

Demands go running through my mind:

- Will it remember my passwords so I stop fighting as I go to each unique site?
- Will it make blogging easier?
- Will it enable dictation tools so I can use my drive time more effectively?
- Will it protect me from losing files?
- Will it integrate in many things so I don’t have to think about add-on devices and related compatibility issues?

But then, I look at the rest of the ad. I get sad.

Right below the hand, they list hardware specs of speeds and feeds. Huh? Does this make sense? That’s not personal. At least not to me; feeds and speeds of hard drives and chip sets while top of the line have always been a part of the promise.

I will suggest here that there is no connection between HP’s personal computer attributes, and the advertising campaign’s messages. It’s a malfunction between product design and marketing decisions. HP does little to back-up its claims. Their personal computers don’t feature any hardware or software improvements that actual makes the computer a more powerful personal tool. Oh, and for all of you HP fans, let me share an alternative that could have made it true.

If HP were to fulfill the promise of “a pc is personal” I think they would have done something different. One idea that my very own non-technology mind could come with is this. Perhaps HP would think about what people use their computers for today and could technology that HP enables create more connection. In this day of social networking, blogging, flicker etc, we all have multiple sites we go to interact and engage with others. But in each of those of different applications, consumers like myself need to log in with different identities. As a blogger, I need to log into Movable Type, then to Linked In with a different user name and password is used. Every day, millions of people like myself are doing redundant tasks because those web apps require a new identity for each one. A hardware vendor that cared about making the computer personal might find a way to create an identity link through all of those networks. With their R&D budgets, how much product development would it take for HP to create a tangible product difference that would not only deliver on the campaign’s promise, but also support the corporate tag line: Invent?

The power of a Marketing Promise.
When a company does marketing well, it provides a “decision short-cut” that connects the philosophy of the company with specifications that make a promise real. Consumers today have too much choice; when product differentiation is lost or confused, marketing makes the choice easy or at least easier.

Is the ad working or is Dell just weak? All that said, HP and Dell products are perceived close to parity in web polls, although Dell has had strong share position. Dell, of course, has had a series of mishaps including their battery issue and now most recent management turnover. With this advertising, HP has done something to Dell by reducing Dell’s share of voice. So even when the ads focused on features, they are still putting HP prominently out there at a time when Dell is vulnerable.

The PC campaign uses two communication strategies simultaneously. HP couldn’t make its mind up which one to use -- a promise story or product story. – so it used both of them. As a product campaign the print executions include model numbers, product features, pricing and a purchase call to action. Unfortunately, it never gets around to telling the promise story.

A hand graphic and a tag line – the computer is personal again – is not a story unto itself. HP simply doesn’t know how to dialogue with consumers and tell them a story that’s believable on a rational or emotional level. If they could, it would be a very powerful reason for consumers to consider HP during the purchase decision process.

With the last few weeks, HP is using an old-Apple trick of bringing out cool people to talk about their advertising. I'll be interested to see if those carry on the story or are more smoke and mirrors to simply position a commodity product.

Technorati Tags:
marketing, HP

That means colors and type fonts.

But it also means experience vs. marketing.

So the questions:

How consistent is yours? What will you do to make it consistent? What has to change to increase its value in the marketplace?

Technorati Tags:
Brand

Start counting and see how many you come up with in 1 hour. I think it holds true.

Now the question I want to answer is what it takes to stand out amongst that crowd if you are marketing to that consumer. More on that later.

Technorati Tags:
Consumer Marketing

Loyalty To Wireless Carriers Is Hard To Come By. By Antone Gonsalves TechWeb.com

Two-thirds of U.S. adult mobile phone users comparison shop for wireless carriers, with more than two out of five doing so within the two months before their contracts expire, a market research firm said Friday.

While promotional offers do some good -- with nearly 30 percent of mobile phone users responding to at least one offer over the last two years -- they do not stop most consumers from comparison shopping and have little impact on customer satisfaction, a survey by Harris Interactive showed.

In an online study of more than 1,000 U.S. adults, with 865 mobile phone users, Harris found 66 percent of the phone subscribers compared the different plans of carriers, with 43 percent beginning the process within the two months left on their current contracts.

"Promotional offers may be more persuasive if they were received within the 60 day ‘shopping clock’ before a contract expires, which appears to be the time where the largest proportion of subscribers are out seeking a better deal," Joe Porus, chief architect for technology research at Harris, said in a statement.

Fully 98 percent of mobile phone users said promotional offers from their carriers did not stop them from comparison shopping, and 85 percent said the offers didn't make them feel any better or worse about their carriers.

Of course, we're not.

Mobile users are not loyal because there is effectively no difference between the technology solutions, the operator plans, and the pricing models. The power structure of the mobile industry is such that it won't likely change.

So, what is going to cause stickiness and loyalty? And who will be the one to do it?

Technorati Tags:
mobile

Success is relatively non-linear. Probably the least non-linear thing I know of. I have a thought that getting fired is probably the best thing that happened to my career and the one thing that forced to redesign of my work life. Getting fired is a dreaded thing -- almost like losing a loved one in one's life.

But it happens. It happened to me. It happened to one of my company's clients recently, in one of the more awkward business moments I can recall. But that's another story. It was strange to say to him that this would turn out to be a good thing. And I wasn't lying. I really meant it. Being fired is so dreaded but I think it can be the turning point to find out who you really are, and to redesign what isn't working, and then to come back anew.

A few thoughts on this:

1. There is no such thing as reality.
Failures might be a part of your picture, but they are a snapshot in a longer photo album of your life. I remember reading in some reader's digest article a lot time ago that after Fred Astaire's first screen test, a 1933 memo from the MGM testing director said, "Can't act, slightly bald. Can dance a little." Astaire kept that memo over his fireplace to remind him about perceptions are not reality. Walt Disney was fired by a newspaper for lacking ideas, and Lincoln lost more seats than he won. We all know similar stories. At any particular point in these people's careers, they were 'failures" but they didn't stop then. They just kept going to build the reality they could see for themselves. And, that's a key lesson for any of us.

2. Hanging on vs. letting go.
Many execs stay wedded to that which got them to their current point of success. If they know Enterprise sales, then they apply those same skills. If they've been doing product marketing for a long time, they might always start a new market strategy with a market segmentation approach. We hang on, we repeat. We stay wedded to ideas that have been key to our success thus far. Sometimes, to get ourselves moving forward, we have to jettison our "expertise" to see what a fresh approach could bring.

I love books about Andy Grove, because he's such an icon of the Valley and of innovators. He once asked Gordon Moore, his co-founder a really strong question that any of us could ask. "What if we got kicked out by the board, and they brought in a new CEO, what would he do?" That question led to answer that Intel would get out of the memory chip business and move on to microprocessors.

And so history tells us that Andy could have held on his "old" but highly successful profitable business, or he could do the reinvention of the company, before it became necessary to do it. He avoided getting fired by essentially firing his old ideas and bringing in new ones.

3.Learning!
The human brain is a unique thing in that it's the only vessel I know of where the more you put into it, the more it will grow. We sometimes think we know enough, but we can always learn an incremental bit here and then and stay fresh. To train the mind to be that open to new ideas is in itself an amazing gift. Meet any successful executive and you'll notice that they have the patience and humility with themselves to keep finding out what they don't already know.

Look at the team you have around you also, and think about whether they keep you thinking and learning. Mine does. I'm blessed by them.

4. Real Time and Perspective.
Often when we are charge of something very big, we face intense periods of time working outside our range of experiences and comfort zones. When faced with the decisions of which road to take next, it's not possible to find a guide, let alone a sign post. We take steps we know to take and that's okay. One day, you'll sit back and have perspective. Don't beat yourself up. Don't worry. it's all a part of the process to take steps we know how to take today and then know more later.

If you can, be compassionate with yourself during these times, you'll be ever more able to understand what was going on later. And those experiences will shape future success.

At times in my career, I didn't know what I didn't know and I managed to do amazing things like build a channel which no one in their mind should have thought I knew to do.

5. Seek to know.
I sometimes think that all of us are information-junkies wanting always to know more about the world and new situations. But I want to suggest we become really knowledgeable about ourselves, and what we know we need inside. When we know ourselves, we become more wise about knowing what situations to put ourselves in, what to manage for, and what pace to run at. Then you come into situations knowing more about what will make you successful. Perhaps that means you work well with a boss that coaches, or you like ot work in small teams. The context of our lives change all the time. But we are the constant and perhaps the thing that we need to understand the best.

I've become what many believe to be a successful CEO of a services firm. What most people don't know is all the mistakes I've made and learned from to get the knowledge and experience and understanding to see situations so clearly today. Most people don't know how many M&A activities I've sat in to understand business tradeoffs, or the # of compensation models I've personally F*cked up to learn what really works, or even the right spend to revenue ratios for different kinds of market segments have been developed by either overspending or under-spending for years and missing the market opportunity.

I really think getting fired can be a good wake up call to start anew. I hope for my colleague and former client that this turns out to be good for him.

Now, off to more vacationing.

Technorati Tags:
Business, Product Management, fired

1. The bad word that starts with an "F" is perfectly acceptable word in business. I remember being in my office at 6:50 and Carol's name popping up on the caller ID. And I started that morning by hearing "What the *Shit* (replacing "F" word) happened with General Motors yesterday? And while I had nothing to do with that up till then, I led the recovery effort to get an account back-- mobilizing product, sales, channel folks all pulled together to save a situation. And Carol never stopped using swear words. She peppered her communications with language. And what I learned from that is that passion is often expressed in that way. I can see that some people can express that passion without swearing, but ya know, sometimes that's just a shortcut. The broader perception is that CEOs should be "appropriate" but I'm going to suggest each of us is more importantly genuine and to hide a part of ourselves.

2. Call a spade a spade. Carol never minced words. You never had to guess what she thought of your idea, program, budget, product line or business division. She would say her comments so clearly, so directly that people sometimes characterized it as "brutal". But the reality is that you never wondered if she said one thing to you and another thing to others. If you got an audience, you got a read. Love that.

3. Fire people you need to fire. At Autodesk, I once inherited a group as I was asked to revamp their charter and related strategies. This group already had a leader who I was asked to fire. I didn't. Because I wanted to give the guy a chance, because I thought it was too mean, whatever. It burned me so badly and burned the business. If you need to let someone go, do it sooner and sooner. Carol, I should have listened to you.

4. Optics matter but not so much. Many people get hung up in how things will be "perceived" rather than the right thing for the business. I'm not naive in that it's never important to worry about organizational politics. But the point is to not get to obsessed about the spin, rather than the core idea. Core ideas can be judged on their own merit. Trust that.

5. Surround yourself with good people & offset your talent. One of the reasons I had the job I had at Autodesk was because Carol created the role. The executive that ran the Americas had a great "outside presence" to talk to customers, but lacked an understanding of the business side of running channels, marketing, sales operations, comp plans, and program choices. So Carol created a sidekick role and then let us create a role that offset the skills and capabilities that the executive didn't have. Some people would think that's crazy, but the reality is that none of us has 100% of what we need. We need to surround ourselves with those that offset the skills.

6. Get out there. Go to the field, and talk with customers and channel partners and business leaders in your industry. You cannot lead without talking to many others about what's going on, to learn, to discuss to create the future. Don't stay in the "ivory tower". BUT and this is a BIG but. You are not going to the field as a queen, as you are not seeking a coronation service. Your job is to be a participant. If the stories about Carly Fiorina are true, she walked into any meeting in the field with up to 20 entourage people. Uggh. How could anyone have a genuine conversation with Carly and how could she be learning and engaging with that large a group? You can't. They were 1-way communications. So when you go out to talk with people, remember to listen.

7. Make your life work for you. Be real about who you are, and what you need. Most of us are not superheros, and we need to get enough sleep, stay fit, invest in our personal relationships and have a perspective. We need that to lead. It's not a nice to have. So why is it that so many executives then work "to the bone". Carol hired a service car to regularly take her to and from the office. By doing that, she freed up about 2 hours of time to work a day. 2 hours that benefitted the firm, no doubt. Some people raised their eyebrows or thought this was queen-like behavior. Remember that Autodesk is based in San Rafael, the land of more laid back people. And Carol was one of the Valley types in this behavior. But without it, she could have fried out, or not led the expansion strategies because she wouldn't have been able to get above the fray. The cost of doing that was perhaps 10K in the year. Maybe 20K. But 20K is not much in the scheme of the value Carol created. and if 10 hours was part of her 60 hour weeks, she immediately increased her performance time by 20%.

8. Peacocks Shine. So do you. There's a conference room I'm sitting in right now and most if not all the women are wearing blcack suits, and white shirts and are simply hiding their beauty. The perception in the room appears to be that we are not allowed to shine too bright. But we are bright. Just like Peacocks can strut their stuff, so can we. It is a part of who we are. Carol was never afraid to wear color or be beautiful. Why not? She is! To hide that is disingenuous.

9. Check On It. No matter what, make sure you have some way to check in. If you don't check in, you are signaling to people that it doesn't matter to you. It would be "easy" to assume that some things can go on back-burner, but people respond to what you ask them to respond to. If you delegate something but don't check back in, it's quite possible people will think you don't care... Carol always made sure that as the meetings were wrapping up, she would say something to the effect of "we'll talk about this again at the xx meeting or in our next 1:1". And, the best part was that she logged it in her binder. You knew she had it documented. Therefore, you paid attention. I often wondered what she was writing down, as it could have notes to her kids but I never wanted to find out.

10. Leave them with Hope. The most impressive thing about Carol is her ability to beat the shit out of you in a meeting and close the meeting on a positive note and leave you feeling positive. Some people thought this was "mean" but the reality is she expected a lot from people. She knew they had it in them, and so her desire to demand a lot is entirely tied to their capabilities. By recapping the meeting with possibilities, and sharing with people what she liked and what was worth building on, you knew she believed and wanted you to be successful. Leave them with hope and people will improve that which needs to be tuned, and then success will follow.

Technorati Tags:
Leadership

Some time in the fall my CEO group "boarded" my topic and got me to see it was serious which led to a series of doctors' appointments. Western medicine, eastern medicine, generalists and specialists. The word Tumor came up more than I care to recall.

And it seems like (assuming final results confirm what the early results show) that I "will live". I am returned to my life flooded with gratitude for that which I have, a refreshed love for the life, and relationships, and gifts I have.

Let me not forget that health is never something to be taken for granted. Not just the absence of illness but the presence of health.

And let this feeling of gratitude for the simple things guide me going forward.

There. By recording it here, you can help me remember.

Technorati Tags:
Authentic, Goodness

"List Consciousness is a state of mind that is entirely future-oriented. With a subtle but constant quality of rushing, it operates on the premise that life will happen once everything is crossed off The List....When you are in list consciousness, you are leaning into the future and completely missing the present."

I wrote that down but not the attribution; my apologies.

I just cleaned the garage this weekend which nearly completes The latest List. Salvation Army, 1-800-gotjunk and Craigs List were all involved in the cleanup process.

The List, the one that lives on the fridge is never really done. it gets nearly done and then recreated. I'm not sure it means I miss the present. I think it means I am clear on the horizon, and where I want to go.

Technorati Tags:
Ideas that Create Value

We talked and emailed a bit to offer advice as he gets his project off the ground. Yet, I was left not saying one thing that I think is central to what he's going to need to manage in terms of process.

Most high-tech firms have this phenomena: Executives go to meetings to make a point. They don't often think together to explore a subject but tend to use thinking to parade their egos. And because most execs are incredibly smart, I've seen a lot of sessions go on where people come to "spout off" rather than exchange ideas.

But doing a defense strategy (or a new market expansion plan, etc) needs more than spouting off what we already know to and at each other. Building a really strong defense strategy means building a common, clear vision of what is, and then creating alternative scenarios of what could be to then develop a plan for defensive moves and offensive pushes. Sounds so easy but man, oh, man are there pitfalls in what people need to manage when driving this.

I'm going to suggest there's 3 things a major strategy session needs to be designed for...

1. Enlightenment
Clear understanding through logic or inspiration. You might get a picture that fasting is involved. But no. In the business context, enlightenment has to be about setting aside the ego, to get clear about facts and figures. When the ego is at play in business, it shows up when people use their thinking to parade their egos, to put others down, to show how clever one is ... individuals sometimes do a group discussion when they are so busy advocating their genius moments, or listening to others, they sometimes don't stop to think. Enlightenment therefore needs to be a primary part of strategy development by getting people to see the facts, without the arguments. To find out what information do we have, what information do we need, and what is missing that we need to learn. It is also a great opportunity to see if something is a fact, or a likelihood, or a belief.

2. Truth
A commitment to honesty and clarity. This experience plays an important role in most personal relationships, but it also is a key component of companies. We see it in brands like Whole Foods, Volkswagen, and Newman’s Own, all of which portray themselves as simple, upright, and candid. Rubicon describes in our literature as "we don't kiss hands or anything else." Cheeky but true. Companies that can get a clear picture of the ultimate truth can create a great deal of alignment. And to be clear, truth is more than facts and figures, it is also our feelings and hunches, our options, our risk assessment, our values and desires. It is in essence the fullest range of "what is". Most leadership teams don't often allow for our impressions without a need to justify those. And, we often don't look directly at risks, dangers and difficulties. To seek truth is to make sure you are looking at and making visible many things, without judgement.

3. Creation
The sense of having produced something new and original, and in so doing, to have made a lasting contribution. Besides telling stories, doing hobbies, decorating our home, or styling our selves, the way this comes out is creative thinking to go beyond "what is" to "what can be" and look and see something that is a way forward that hasn't been done before. On a personal level, it's the same reason that we like to create our own custom pizzas when the 10 menu choices could cover 99% of our desires. At business, we need to build new options by a design stage. Some people start this part of a meeting or workshop by saying "all ideas are good ideas". Yet, they don't manage to it. That's because there are people whose self-importance perhaps even self-definition is tied to their ability to assess or do critical thinking. They are they people who say..."Yes, but". Even if 85% of the idea is excellent, the tendency is to focus on the less excellent 15%. Yet creation is about building on the 85% and turning it around to keep improving the idea. Most people cannot see the intrinsic benefit in an idea. They focus instead on how it doesn't fit. I don't know where I personally built the skill but along the way, I can find a good idea in just about anything. I'm serious: talks, books, people, to the totally nonsensical items... Maybe that's why I'm an entrepreneur and fairly good at this strategy creation business. Finding value in anything that those around you have not spotted means you are finding value and benefit that are not obvious to others. That's a rare skill and worth building.

The funny thing about doing new vision or defense strategy sessions is this: The answers are not obvious. If it were, you'd already be doing it. So when it comes to doing a big thing like a "defense strategy" or "3-year planning", it's really important to leave our natural tendencies (egos, confusion, critical thinking) at the door. None of the brilliant ideas can get started until someone shares and others listen, until people bring all truth to bear without judging one another for intuition or risk assessments, and then jointly nurture a seedling of an idea into a vision that builds one another's ideas.

Thanks for letting me get that off my chest. I've been using the blog lately to capture some ideas that are floating around in my head. I hope it's helpful to others.

Technorati Tags:
Ideas that Create Value, Market Expansion, Microsoft, Strategic Planning

Let's go 180 degrees in a different direction, at full speed, with everyone on board, and expect our current business to do great while we turn everything in a new direction. Yippee.

Sound like a good idea to you?

I worked with a client over the last few weeks that had done just that. And the results in sales morale, customer adoption, market response and current sales just (to be frank) really sucked.

Which makes me want to say... Whenever you want to do a break-through notion for your company, think it through and s-l-o-o-o-w down to check your assumptions and be thorough. In the scientific approach, there is a process to develop new ideas. It involves: observe, hypothesize, predict and test. When planning for B2B growth, this translates into the following actions:

Study the Market.
This means to learn. Begin by learning the current size of and your relative share in all potential markets where you want to compete and win. Understand what's going on, and how the movers and players respond to new stuff.

Define the Outcomes specifically.
Start defining alternatives on which segments, markets, customers (based on your observations) you think you can win. This is your hypothesis. Say a $ is not sufficient. It's gaining X% share, or winning Y number of times in a competitive situation, or gaining Z accounts.

Do the Go-to-market Planning.
Consider what exactly needs to happen to make your hypothesis a reality. An answer or prediction that you can gain share in the short term by concentrating the touches of your sales force could be one option. You also predict that you can gain share in the long term by developing better offerings. (And, don't drink the kool-aid here, because a valid measure of a better offering is that the targeted segment/ market / customer can produce better results with it so their business is noticably improved.) In the prediction phase, look at all the 9 major forces of a GTM strategy (including product factors, marketing factors and sales factors).

Pilot.
Try it, and see if your hypothesis holds true. In the example, I've been building, the test of the soundness of the strategy is that your business is gaining share in the targeted customer set / segment / market. Look at the hard facts of true gains. You can use early predictive metrics like trial download or pilot deployments to understand what is working or not. If you have ANY doubt on a "risk it all move", then pilot first, and pay attention to what is working. Pilots are not a cop-out. Pilots are a way of making things work on a scale that will enable success so that when the fuller plan goes into effect, you don't risk morale or results along the way. If you want to penetrate the whole US, why not try a regional market and understand what it will take, say, to win the New York market.

And then I would add optimize to the mix. Look at what you've done to tune and optimize the mix of spend to return and see if you can cut any unnecessary steps or investments out of the mix. Stay tuned to what's changing so you can keep innovating.

Every growth strategy can be improved by using this systematic approach. Try it on your current strategy and see if it helps you move from here to there even better than the full 180 degree turn does.

Technorati Tags:
Market Expansion, metrics

- Surround yourself with more creative people, or
- Study more (content) ideas, or
- Talk more at length debating with others, or
- Get better educated, right?

I'm going to sound like a cheesy late-night commercial ... I think there's a better, more cost effective, faster way to be smarter, wiser, faster.

Intelligence is about creating a model of the world, and then being able to predict, adapt and organize with new data all the time. I see it sometimes defined as the high-functioning work of the neocortex in the brain.

And getting intelligent, seems to me then is figuring out a model of any situation fast and accurately with predictive abilities. Certainly, education and sheer talent and operational experience helps to be more intelligent, but I'm going to suggest that asking a certain set of questions will help you build that model faster.

This month, my firm and I are tasked with a few complex challenges where we will hopefully add some value.

1. A software has a 54-page price list, with an average 80% discounting, no product differentiation to customer segments, and (as a result) an inability to administer their licenses and optimize revenues.
2. Another firm could create a new category to become the infrastructure platform for a form of video online. However, to do it and create the needed momentum, they need from us to the economic or business model could be to enable their adoption as the industry standard.
3. A company does "web marketing" but wants to do "web strategy" which has a different meaning for anyone and everyone in the company. They plan on hiring a guru but it's a case of not even knowing what they're looking to "fix". Hire wrong and the situation could get much worse before it gets better.

The practical aspect of doing these kinds of problems is to go from problem clarity to options development to selecting an idea. It's stinking hard to understand all the factors and data and then take something that is complex to get clear on all the multiple facets, including risks, opportunities, change management factors, facts and figures, and those things that will fundamentally create growth and / or optimization. Our role inside organizations as trusted advisors is to do this "understanding thing", fast, and then turn around to solutions.

And the key to understanding, is to make sure you're looking for all the things that help build a model.

Let me propose that when you are looking for more intelligence, it can be done by thinking about what model are you building... a multi-dimensional model includes:

1. Facts and figures. All problems have to have a set of data. Could be sales as compared over time, or cut by regions. Or it could be a regression analysis to normalize performance over time and in relativity to a known factor (i.e. GDP). But data can form a sizable piece of building a model. A lot of people find some data and then believe it's source as the truth. One of the greatest myths inside companies is that everyone forms a conclusion on some piece of the data rather than a full set of it. So make sure you are looking at data of the situation, normalized for perspective and comparable to something meaningful.

2. Emotions. Figure out how people feel about things. Could be that there's been some personality conflict that is causing some perspectives to be tuned out or up? If you ask questions about how people feel, what they want, or what greatness looks like, you're going to hear the emotional part of what will cause or resist change. And that's what makes it relevant. All strategies and great moves require change. Change inherently is about people. So you've gotta learn what is going on at the heart level to know what needs to happen next.

3. Opportunities. Sometimes that which is causing us most angst can be flipped around from a negative to an opportunity. A fellow CEO recently formed a strategic partnership where they become the 'category builder' for a retailer coming into the US. This would potentially put their existing sales with a notable retailer at risk, if they knew. And the conversation went around and around about whether to tell the current business retailer about the move. And one question (smart, I thought) was to ask whether by telling them, could they essentially score more business from the first retailer. Could they ask the existing business partner to buy more from them, thus defeating a new entrant into the market?

4. Risks. Learning what risks exist in a new idea or direction is very valuable. Sometimes the people who bring up risks are "naysayers" or at least are perceived that way. But the reality is that they are followers who are digesting the direction, and then sharing with you what it will take or what needs to be overcome. Encouraging this conversation sooner rather than later can make sure you invest well up-front, know what you need to address, and make sure to manage the things that could disrupt change. One thing, though, is that groups of executives sometimes so focus on the risks that they forget the risk of staying still. It's okay to have the full conversation about risk but at some point, someone must decide what to do and take into account what needs to be considered to go and win.

5. Green Fields. Taking a completely different point of view and generating some breakthrough ideas (or things that could represent what we in the valley sometimes call green fields) takes some courage. Because what you need to figure out is what latent thing could be developed. Without asking "what is the craziest idea we could pursue" or "what options could we develop -- even if we can't do them today" are all ways to get to that place where all ideas are good ideas. And the key in the green field stuff is to keep going and probing without editing and critiquing. In a sense, a green fields conversation is about reviving hope and creativity and letting that run around for a while to see where it might lead.

By looking at topics with all 5 points of view will drive a more intelligent model -- one that accounts for information, logic, hopefulness, emotions and new ideas. Not only to be gathered together and weighed but combined to help you think better, making decisions and leading with greater success. Try it. See if it's worth the 000.00 plus shipping and handling you just paid.

Technorati Tags:
Ideas that Create Value

Those people that you're calling, emailing with or reading, they're special. Not special like they took the short bus to school. Special, my friend, because they are the alpha crowd, they are influencers. They are not 1 person or type, it's many people who all form a unique profile. Parts of that profile are common across the entire group of "influencers" and a bunch that are specific to the category we're talking about. The school advice might come from the bbq expert but probably not.

In this web 2.0 era of ready access of information everywhere, anytime, we've got a new class of people business and marketing people can and should pay attention to. For those of you that are old enough to remember, there was a time when you couldn't google up information to find out what the opinion makers and advocates were thinking. Amazon didn't exist so we could see what others, worldwide, thought of a book and learn its sales ranking. Instead, we had to go to places like churches or synagogues, grocery stores and book clubs, and ultimately hanging around with neighbors to find out what "the news" was. That's because influencers were active, engaged members of local communities. They've always existed -- opinion makers and opinion leaders. What's different now? Today they have a bullhorn available to them -- it's called the web. Where they once talked to 100 people in a month, they can now reach thousands or tens of thousands with a single click, comment, ranking process.

These alpha consumers or influencers (either term is fine with me) are the key to awareness, consideration, preference, purchase. They advocate, rank, sort, evaluate, and ultimately create marketplace adoption. They come in the form of users, developers, channel partners, and press people. Many PR people have thought of influencers as "their audience" or writers, but influencers are way more than analysts and writers. They are ultimately the tip of the market.

I recently read the book, Influentials by Ed Keller and Jon Berry. For getting some frame of reference on the core aspects on influencers, this is a great resource. Influencers are key conduits of informations. They know many people, and are in contact with many people in the course of a week. They have a powerful multiplier effect, spreading the word quickly acrosss a broad network when they find something they want others to know about. General guidelines: they are well traveled, almost always have a religious life, they hold the status of leaders (civic, business, non-profit), and generally hold an activitist approach to life. They almost always have a general sense of optimization because they believe in the power of good, they like people, love to orchestrate ideas and they tend to be (but not always) great at building relationships. Interesting statistic: 4 in 10 have a connection to their professional association. This is a sign of their restless intellectual interests. Influencers continuously take input from what they see, hear, read, and keep turning it over in their mind for new insights and ideas. They are sometimes entrepreneurs. Typically they start to be an influencer by getting involved in the community. My husband is not traditionalaly a mover or shaker (his words, not mine) and yet he’s gotten involved in the Los Gatos chamber. His vocabulary has changed. he refers to the city we live in as “our city” now. Influencers and alpha consumers are people who place importance on values : enduring love, knowledge, authenticity, stable personal relationships, learning and freedom. When you can get them to pay attention to your offer / product / solution, you have the opportunity to shape the market.

SO, the big questions:
How can we better understand them?
What makes them tick?
How to they spread influence?
Can I persuade them to spread the word for my product / service / organization / idea?

Most companies don't know what to do to systematically to guide these consumer marketing advocates. But we've been designing a few leading-edge programs for some notable brands and here's what I know to be true:

1. Selection /sort matters.
Influencers need to be sought out. They do not run in packs. They are more likely to be running the pack but it's not necessarily the case. These are also not the early adopters (who often like technology stuff or new stuff for its own sake and are willing to be irritated to be the first). So the key is to figure out what would make a good influencer for your product / service / category / idea. Then think hard about where they would hang out and how can you find them. You can go to online forums to see who is commenting. You can check amazon profiles as sometimes this is the "recommended list" guy or gal. For each market, you need to find the few amongst the many.

For one project we did, we found 100 and then sorted them down to 8. It took us two weeks of online activity, recruiting from established forums, asking who else was good, etc to get the 100. It's a time-intensive, judgement-intensive process. While it might be tempting to delegate this to your most junior staff member, this quite likely belongs to the most senior person. Getting a group of the key folks is the key to building a strong program.

Developing a screener for what you are looking for will help you avoid getting lost in the forest.

2. Size Matters
Yes, it's true. Size does matter. Having 8-10 in a group is the right mix. Any more and people don't listen well to one another. Any fewer and the momentum and energy isn't there. That said, make the term of your influencer program about 6 months and then rotate people off and on that can keep building your point of view and market access. In addition to the 8-10 users from the market, you want to involve 5-10 people from your business unit or company to listen, engage and commit to nurturing this group with ideas, content, etc.

3. Two-way flow is Critical.
THe key to building an influencer program is communication. The specifics of that are dependent on the influencers and the product. For a software product, it might be getting clear on industry standards, vertical understanding, and / or doing beta reviews. For a mobile audience, it would be a different list of program requirements. But fundamental to all that is communication. And just to be clear, it's person to person not company to person. Doing the corporate speak, highly vetted program will only make influencers despise you. You want to have someone on your team be their advocate to listen, learn, ask and probe. Because influencers are fundamentally good relationship people, you want the person on your team to be good communicators, bloggers, writers and all that. You want to build trust with these influencers because...well, just because. While your executive team will want "results" you need your evangelist and advocate for this audience to buffer that and focus on building an information flow that benefits both the company and the consumer. Have them test drive beta products and critique it. Have them take a look at your market positioning statements and fix it. Etc.

4. Without Listening, you're dead already.
Make sure your door is not shut when these opinion leaders, alpha consumers, and influencers come to you with a complaint or a question. You should pay attention to what’s happening because when they are telling you this, you are getting an early indicator of what others are thinking. True to form, influencers swing into gear and hit their best notes when they can solve a problem. Remember that influencer are helping you with their "noise". In return, they want respect, communication, social validation / approval in front of others, liking, any form of authority, and ... (drumroll, please) the opportunity to influence YOU. Perhaps that was too obvious? Perhaps not.

5. Spread the word is a calculated set of steps.
To know whether you are doing a good job on an influencer strategy means knowing that the opinion leaders are getting their ideas circulated. Find out the kinds of publications, reviews, articles, radio stations they listen to, websites they go to. Learn where they are going because that will tell you where the next concentric circle of influencers are. When people make decisions today, it’s a conversation. The internet has broadened the conversation, allowing people to research purchases, post questions to companies, and to link to other consumers, email their friends, forward Web links, and develop bulletin board relationships with peolple of similar interests.

The conversation level between users and consumers is rising. In times of change, people naturally seek a guide, someone who’s been out ahead of them, who’s already identified the issues, addressed them in his/her own life, and can offer good, reliable, informed perspectives, advice and information about what’s going on now and what’s to come, ... in other words, someone they trust. That's the influencer. Harness that guy or gal into your offer and you'll have a strategic advantage.

Who is yours?

Technorati Tags:
Influencer Marketing, Customer Research

The slide I'm referencing is this one:

In it, Technorati, is defining "authority" ratings of the blog universe. And their authority measures are measuring the average # of posts per day and how long that blogger has been posting. What this is measuring is not so much authority in my mind as productivity, propensity to produce, or velocity. The measure is how much volume someone is producing. Which is certainly one measure of authority.

One could argue that many who write often are not necessarily the highest "authorities" online.

Might I suggest another metric of "authority"? Measure traffic of blogs against the number of discrete articles. That would measure the impact of those articles. It might allow the authority measure of someone who's primary role is not to publish, but as a sideline interest to write. So they might write sporadically or even consistently at some different rate (say once a week). If they are getting volume readers, and more importantly repeat readers perhaps THEY are a different kind of authority? Perhaps they represent the more sage, considered point of view one listens to and savors. Just an interesting way of looking at metrics once again.

Technorati Tags:
metrics, Technorati

But what about employees? Are they co-creators, too?

Many, many fortune 1000 companies are afraid to let their own employees blog. "What if they say something we don't like?" is the question I hear from potential clients. But actually the question is "what don't you know [that's already going on]?"

My colleague, Bruce LaFetra, wrote an email to me today to say:

I don't see how the employee blogger is really that different from any other customer-facing employee. Of course, the big difference is that most bloggers are not (otherwise) customer facing... and they reach a much larger audience than the typical employee. I always love the story (from many years ago) about Schneider National trucking and its dress code for truck drivers. The rationale was that for most of their customers, the driver was the only employee of Schneider National they would ever meet.

Because blogging is like any other communication -- more amplified perhaps -- but just another signal in the spectrum to say what your firm is, what it represents, and what it believes.

Treat your employees like your best customer. Because they are. And perhaps they create your brand by living it. And they certainly communicate your brand every day. Don't worry about blogging, but do make sure your brand and what you believe is embodied in your team.

Technorati Tags:
Authentic, Brand, Schneider National Trucking

People are most likely to believe, in this order, from these sources:
#1. Their own experience
#2. Peers / someone they can validate
#3. 3rd party experts
#4. Companies, directly

I agree with this model.

When you're doing marketing are you doing mostly company-focused speak, or are you doing what works:
- giving people the ability to "try" what you have,
- to hear from others (ala video testimonial),
- engaging in real conversations via blogs and 2-way forums,
- asking for referrals from existing customers,
- and, working with key influencers in your market.

Cause those things, my friend, are the keys to growth. Spend time and money according to these belief hierarchies.

Technorati Tags:
Consumer Marketing, Phelon Group

Yet place that entrepreneur or self-driven leader into a team or larger organization and that same approach of pulling out one's sword to eliminate dissension really doesn't work. Yup. It's typically a bad scene.

That's because co-dependent teams and / or big companies tend to be more and more like the Roman Senate -- taking time to consider, to debate, to weigh, and then to select amongst many choices. When there are more things / ideas / implications to consider, it takes time and is more focused on optimization. Doing it wrong could affect many poorly so better to wait and do it right.

So a few take-aways:
- If you're going to be a part of a team, realize you need to put down the sword and pick up a pen. Communication, context setting, and collaboration become very important when aiming to build a sustainable organization.

- Know yourself well enough to know if you should go into a firm vs. go solo. They're different beasts - not better, not worse than others, just different.

- Knowing when and how to navigate for speed (aka samurai) and for long-term strength (ala senate) means knowing when to toggle between the two approaches. Expanding your own toolkit and perspective can be good.

*Phrase of Samurai vs. Senate got planted in my head last week but I can't recall who said it or if I just made it up. Anyone who was at Web 2.0 remember so I can get attribution right?

Technorati Tags:
Leadership, Business, Web 2.0 Summit

#1 There's a real Heirarchy in Value Creation
Apps beat features. Online applications beat packaged applications. "Open" applications beat online applications (meaning those you can build on or get your data out of). Platforms beat any application. Customer experience beats platform. Ultimately the customer experience and not the feature set will define success.

As an illustration, Salesforce.com has found a way to become a real player again. I used to think AppExchange was a cute little idea and after hearing about Marc's "elastic database" I see I was wrong. This thing is pure enablement for many players. It is similar to Ebay or Amazon in that this is clearly a platform play. Salesforce.com has unbelievable data and a fairly inexpensive, flexible platform for people to develop away. Easy APIs for people to design neat applications around the AppExchange platform. Because of them, you have a database service. You no longer need oracle or SAP, and can use services on the network to enable great data management.

#2: Competitive Play = customer focused
Focus on doing good constructive things, and looking for ways to protect and enhance the consumer is the google objective. Do the customer right. We [google] don't worry about getting big, but we do worry about taking our eye off the ball. Those industries that withhold information, withhold customer choice, those die. - Eric Schmidt Google

#3: Make your Organizational Design about Small
Small teams win. Craigslist with 18 people was in the top 10 Internet Companies. Google focuses on small teams to enable creativity. With Web 2.0, efficiencies are about small, creative, productive teams with focus who then know how to leverage one another and then leverage from the community to build on what they create.

#4: Managing Information central to Next Innovation Cycle
The key to the next evolution is managing information. It's not about whether writely or spreadsheet apps replace Microsoft office. It is about how we consume, share, and manage information. Our information is the critical element. And yet we harbor it in little devices, hard drives, and locations. Omnidrive was on the launchpad list and the only one I thought would serve a new need.

#5: Coolness and Mockery will happen.
"There will always be people who think you are a jackass" was the comment by those that bought Myspace. But the key to any acquisition or strategy move is to execute your plan and "see who the jackass really is in the end". There was a great deal of criticism when $580 million was spent for MySpace, and now Rupert is a genius in the wake of Google’s validation of the space. There will always be naysayers, even on your own team. Listen and then change what you need to, and create. Creators are unusual but naysayers exist everywhere.

#6: Choose Speed with steady improvement, over long development optimization
Googlers respond and use more when the search query is faster. The upload on Google Video was 24-48 hours, and YouTube was instantaneous. Who won? YouTube. Fast and nimble wins the race. Make up in volume what you need to do with customers but let them have immediate access, fast interactions and they'll forgive another click to get more information. To me this is the idea of incremental improvements. Keep going in the direction you need to go, and you'll get there, but if you wait till it is "perfect", you'll be passed up.

#7. Create opportunity for many to join you in solution creation.
Goldcorp had geological data and created "the goldcorp challenge: Paid anyone to find gold on the property. The contest allowed them to find $3.4B in gold for a nominal cost. This proves the point that as long as you have a problem that could benefit from many minds and talents, you can be open -- the many can be smarter than the few.

#8. What looks cool today maybe old school soon.
I'm not sure anyone remembers this really but there was a time when Compuserve, AOL were the cool kids. Before that, we didn't have an email system. There were comments at this week's Web 2.0 conference that Facebook, My space, etc is the same. And to some degree I buy it. What creates a category isn't necessarily who develops, and grows a category. That's why Ning (Marc Andreesson's new company) is definitely an iteration off of myspace. Where myspace has the same standard profile for everyone, and a lack of ability to limit who sees the social network, Ning is customizable in several ways and will allow those that care about privacy and brand to manage their own networks. The point is that where YouTube and MySpace disrupted media, Ning is going to disrupt them. It's called innovation. John Battelle made the observation on the second day that several of the folks were saying how they were going to compete with Google, because Google is effectively the "Model T of Search". It was a great line and indicative of how fast and sharp John is.

Remember this: incumbents have a different set of risks once they've established a category. They have to be "backwards compatible and get customers to move with them. That's different than the newcomer who only has to offer something incrementally better. Doesn't mean innovation doesn't happen, it just requires a different set of ideas and sorts.

#9. Entrepreneurs take risks and focus on REAL value.
Bob Parsons runs godaddy.com. Well known partly because of his radical television commercials. Because one was pulled from the Superbowl, got more traffic than if it had played. This is a guy that says he "sort of failed 5th grade". Backed out of going public after filing the papers and getting close. "I didn't see much evidence that there was thinking beyond short term paper profits." He had 900/1300 of his people in customer service. and he was getting pressure to lower those costs. And what he realized is that when he was ready to close up the business, he would cut those costs.

He won my heart by saying: "Operating cash flow more important than paper profits". Entirely self-funded and earns $1M cash/ week.

#10. For all these entrepreneurs, focus on real money, not the paper money.
I could see the drool and froth from the entrepreneurs when they sat next to VC folks. But Ram Shriram, one of the earliest investors in Google, said “I’d rather see start-ups scrappy and frugal and on a diet of Ramen noodles.” According to him, one is not going to get YouTube kind of exits always. So it's important to be frugal from the beginning.

Hooray for a voice of sanity.

Bonus round:

#11: Advertising.
Advertising, like all marketing should not boring. If you aren't alienting some %, then you are going to get lost in the noise. Bob Parsons said, and I agree, that when it comes to promoting, be different. Stand out, and take a risk.

#12: Those that are top of the heap have much lower marketing costs.
Ray Ozzie: "Unlike google, I don't have to acquire products or users."

Technorati Tags:
Consumer Marketing, Market Expansion, Leadership, Microsoft, Platform, Yahoo, Web 2.0, Web 2.0 Summit, John Battelle, Google

Some key points she raised during her talk with my commentary:

#1. "Google, Yahoo, Ebay, Japan/Yahoo, Amazon account for the top 5 global internet leaders." Google of course is the market value driver. Interestingly they all have different business models: Advertising, Content/Advertising, Commerce Platform, and ECommerce Engine. My question / comment is what will be the next business model to catch fire. I believe that it's the one that can help the major brands behind each of these businesses to create a customer experience with their brand, such as integrated media management across platforms.

#2: "Approximately 2% of all public tech companies create close to 100% of the wealth." I'm also aware that of any industry, only 2 of 100 companies after 10 years live on their own. Most get eaten or beaten. The key is to figure out what you can do to get eaten or exist as a larger scale entity. Partnerships and scale seem key. In the web 2.0 era, it is also about being a "platform". See related ideas on developer strategy.

#3: "Yahoo has the greatest # of users at 418MM unique monthly users." This came up with in other sessions at the web 2.0 summit. So the key is whether Yahoo can improve their business model to monetize all their users beyond news.

#4: Advertising continues online growth track. Efficiency driven by Google to enable everyone to be an advertiser will continue that trajectory. My guess is that majority of the upcoming growth is the major brands weighing in with both feet. "8% of total US advertising is done online. Estimated 70% growth of that number within 5 years." Those that can monetize brand consistency (not just text based advertising), or increase relevancy to the advertising will make money on it.

#5: Video is where the next wave of $$ (aka monetization) exists. "80% of internet traffic is unmonetized (often, copyright violating) video traffic." This will only grow and those that can make money off of it (aka the Apple IPOD business model) will be the higher growers.

#6: Check out the top 15 properties online: MSFT, Yahoo, Google, Ebay, Time, Wikipedia, Amazon, Fox, Ask, Adobe, Apple, Lycos, CNet, YouTube (now Google) and Viacom. Any surprises for you?

#7. "Mobile is entering the adoption sweet spot in 2007". The market is finally ready with a broad enough pipe, and now the data services available. Interestingly enough, I don't believe the mobile play is about hardware devices or even the carriers (while they keep trying) but about the services and content available on the web and via portals. If someone can get the available apps and solutions known to the users, this market will really skyrocket. Also, there is some ability to now do advertising with a code in the physical world to enable mobile users to transact anywhere anytime. I believe this will only grow, and thus bring shopping up to a new level via mobile. I'm also thinking Enterprise has to take advantage of mobile now that the pipe is big enough to support commercial business.

#8: "Effective editing of video will become more important." - e.g. Yahoo's The 9. Or Apple's Professional and Motion product, or Adobe's video solutions. As Video grows, so will Apple, Adobe, and possibly Avid's business in this realm. Look at seeing segmentation for the home user, pro user and commercial application.

#9. "Only 13% of top 15 online retailers are pure internet plays (Amazon is #1)". No one predicted this in the last boom. So look at media companies to enter the online music and video markets more aggressively. They're poised to take part of this market now. Especially if the Fox, etc sponsorships of the Web 2.0 Summit are an example of their next moves.

#10. "The younger generation migration habits are driving internet growth and where monetization habits". Pay attention to what your kids or neighbor's kids are doing online and you'll have an indicator of what's next.

Technorati Tags:
Consumer Marketing, Market Expansion, Emerging Software Trend, Adobe, Apple, Developers, Yahoo, Web 2.0, Motorola, Palm, Web 2.0 Summit, Google

Loads and loads of applications and services now exist "in the cloud". You can use Google's writely to create sharable documents, and Ning's social networking site to create your own branded community.

But as all of this "in the cloud" stuff is happening, somebody's gotta ask the question -- where the heck is all this stuff? And what city has enough power to generate for those datacenters? And what is powering the cloud?

Debra Chrapaty of MSFT makes the point at the web 2.0 conference that the datacenters are the “cloud”. My reflection: If you believe more will move to the cloud, then you've gotta start deciding which vendor can / should win or if the overall category is generally hot for investment. I also think the storage market could be the proxy indicator to web 2.0 success. If you see the heat come off this bubble, server and storage vendors will be impacted. Fundamentally, infrastructure needs to be built before consumer-focused technology can be deployed. And that explains a bit why Cisco just announced more good results.

And given the volume of processing and related heat, building green could become key. Even more reason to look at reflective building materials, natural cooling design, and solar power. Good adjacent market to invest in...

Technorati Tags:
Market Expansion, Cisco, Microsoft, Web 2.0 Summit

Being a critique takes a certain analytic talent -- to see it perhaps quickly, poke it incisively, and lay it open for others so any particular flaw is exposed. With them around, you're less likely to make (many) mistakes. Having only critiques evaluate ideas is a little disheartening but perhaps comforting at one level.

John Wood, the founder of Room to Read just wrote in, Leaving Microsoft to change the world, "that if there is something out there you want to do...don't focus on the obstacles. Don't ask for permission. Just dive in. A lot of people will try and talk you out of pursuing your dream. The world has too many people who are happy to discuss why something might not work, and too few who will cheer you on and say "I'm there for you".

Having a critique around as an advisor would be like being in the middle of the country and lost trying to get to NYC let's say, and having someone come by to say, "this freeway won't take you to there". Okay, fair enough. But don't just leave me there, dude. Tell me which one does!

Which brings me to my point: When you critique something, finish the thought to say ... and here's what could / will work better. By being moving from being a critique to being a co-creator with the person makes you part of the solution. You move from outside the bubble poking at the idea, to inside creating momentum.

On a spectrum of people, a lot of people will try and tell you what is broken about a new idea, an innovation, a new strategy, a breakthrough notion. And as John Wood says, the world has a LOT of people who are happy to discuss why something won't or might not work. Then there are a few who are happy to be a cheer leader for you while you struggle to find the answer. Then, there's a few who will get in your situation and start navigating towards the right direction with you. Be this person, and you'll be there for a lot of people and become really valuable.

Build it, create it. See it when few others do. It takes more energy to do but what you're left with is a bigger whole than smaller parts strewn around.

And if you wonder what sponsored this particular entry, it was listening to a sole-proprietor consultant talk about his client by just critiquing away all their ideas. If I were the client and all I was worried about was avoid a mistake, i'd think this guy was good enough. But if I actually wanted to win the market, I'd fire his a** and find someone who wants to build the right strategy and solution that will evoke and create success.

Technorati Tags:
Leadership, Consulting

Being a critique takes a certain analytic talent -- to see it perhaps quickly, poke it incisively, and lay it open for others so any particular flaw is exposed. With them around, you're less likely to make (many) mistakes. Having only critiques evaluate ideas is a little disheartening but perhaps comforting at one level.

John Wood, the founder of Room to Read just wrote in, Leaving Microsoft to change the world, "that if there is something out there you want to do...don't focus on the obstacles. Don't ask for permission. Just dive in. A lot of people will try and talk you out of pursuing your dream. The world has too many people who are happy to discuss why something might not work, and too few who will cheer you on and say "I'm there for you".

Having a critique around as an advisor would be like being in the middle of the country and lost trying to get to NYC let's say, and having someone come by to say, "this freeway won't take you to there". Okay, fair enough. But don't just leave me there, dude. Tell me which one does!

Which brings me to my point: When you critique something, finish the thought to say ... and here's what could / will work better. By being moving from being a critique to being a co-creator with the person makes you part of the solution. You move from outside the bubble poking at the idea, to inside creating momentum.

On a spectrum of people, a lot of people will try and tell you what is broken about a new idea, an innovation, a new strategy, a breakthrough notion. And as John Wood says, the world has a LOT of people who are happy to discuss why something won't or might not work. Then there are a few who are happy to be a cheer leader for you while you struggle to find the answer. Then, there's a few who will get in your situation and start navigating towards the right direction with you. Be this person, and you'll be there for a lot of people and become really valuable.

Build it, create it. See it when few others do. It takes more energy to do but what you're left with is a bigger whole than smaller parts strewn around.

And if you wonder what sponsored this particular entry, it was listening to a sole-proprietor consultant talk about his client by just critiquing away all their ideas. If I were the client and all I was worried about was avoid a mistake, i'd think this guy was good enough. But if I actually wanted to win the market, I'd fire his a** and find someone who wants to build the right strategy and solution that will evoke and create success.

Technorati Tags:
Leadership, Consulting

This coming week, I'm speaking and facilitating a workshop, sponsored by the national Women in Technology (WITI) conference on a rather soft topic, Spirit in Business. The idea of the talk is this... like the best Steinway can get out of tune, we humans can get slightly off kilter in small moves. The many decisions that lead to "right or wrong" are often more shades of grey and unclear forks in the road. Ethics are fundamentally about a set of gradual and subtle decisions that lead to larger impact.

I'm thinking about this talk a lot, especially as it relates to the origin of ethics and what people can put into place to make perhaps better decisions. We can move from being experts on facts and novices on values to experts on values, and students of fact.

Is Morality a Sometime Thing?
The newspaper headlines are full of accounts of CEOs lining their pockets,, making decisions that are not transparent and downright lying. These are not some no-name, aggressive companies on their way up, but leaders of notable companies that have held strong brands for years: HP's Dunn, Sonsini, Greg Reyes, Jeffrey Skilling of Enron.

Could this be some proof that even those at the top can lose their way? I would argue this is true, and yet not that they as people are bad, but that they have made some bad decisions. Bad decisions that any of us could make. Unless we build a system around us to prevent this. And even then, we'll likely still make some bad decisions but maybe we'll learn from those as well...

Where does morality come from?
Morality, ethics, spirituality in business are funky topics in today's 21st century results-oriented business culture. My own story of why I care about this topic is, of course, personal. I am loath to suggest I "know" ethics as much I can say I admire certain things and wish to integrate them into everything I do so that they feed what I do and how I do it. I got into a huge brou-ha-ha back at AutoDesk where I chose a series of decisions that ultimately cost me a friendship of a long-time girlfriend. I didn't intend to go down that way, to lose sight of personal values of respect, to terminate relationships for the expense of business decisions. But then I didn't have a framework then on what to consider and what choices were available to me then. Morality is defined in many ways, and I'll refer you here to see the range of ideas.

Morality and Ethics in Business Today: A framework for looking at it.
Okay, don't all b-school people come up with frameworks about business concepts, so why not about this? Here's mine, that I've adapted, after reading some older books and most recently a book on business and spirituality by Harvey Fox, about a course he taught at Harvard.

Recognize: We must have the ability to recognize an issue as a moral issue.

Options: We need to frame "what should I do" choices

Filter: We need to have a filter mechanism designed to sort options.

Courage: And then we need to have the moral courage to act a way we see as "right".

Recognize Issues as Moral:
When is something a moral issue? If you were Patricia Dunn and you had a leak on the board, would you view that as a moral issue? Or as an investment decision, a process issue or a political issue? Maybe the issue at hand was all four, I suppose. But the question is whether we look at what we are doing not only for the surface of it, but to understand or intuit what it could be. While many decisions we make in the workplace are binary yes/no decisions, some have more long-lasting implications. But especially when people are at odds with one another, there is almost always a moral question. A question of which division to shut down, the question of how to "downsize" a team, a question on who to promote to lead a new initiative, a question of what the compensation plan will reward. Those, all of those, have a moral question implied in them.

Framing "What should I do" choices:
A good friend of mine, Marc McGee, said "about all things, ask yourself "who do you want to be" and that will tell you what you do. This concept is one that assumes we have some experience of morality in our life and the ability to draw right from wrong within us. The notion of looking in vs. looking out seemed like such a foreign concept at the time -- like I had the time or interest in that kind of relentless self-examination...? But Marc was right then and he is right now.

Many times, things can come down to "pro and con" lists. You make two columns, write down all the factors and then pull the trigger on a decision. Certainly I can remember doing this before b-school and I find that more education only taught me more ways to build a spreadsheet of options. Now, let's look at what happens when you live within this binary thinking. And then what happens when you open the aperture and look at more options. To see or feel a moral question, sometimes means step outside one's own point of view, to see that of other class, eras, genders and ages. Human beings are often dissatisfied without "an" answer so we yearn to limit options perhaps. Yet if age teaches us anything, it's that life is full of unsatisfying and incomplete stories. The full implications of things considered are rarely ever as simple as pros and cons but more about "what road does this put me on?" When we're in the middle of a situation, it is tougher to access options. The missing dimension in nearly all moral reflection is an imagination. We need to reach beyond what we see, to what could happen when we follow a path. I could use Dunn's example today because it easy to see that when she choose to enable pretexting to the board, employees, journalists, she gave a green light to violate privacy and show a distrust to all concerned. Did she think through that, I wonder? Because the decision (to me, at least) was not about whether to pretext which on it's surface looked like a viable option. Rather, whether to go behind someone's back to spy on them. If Dunn's choices could have examined the options and imagine what other choices were available to her. Perhaps those could have been a dramatic moment in the board room, or hiring an expert in challenging conversations, or perhaps calling in the police so the issue became public and the leaker found through public intervention. But the decision was to keep the issue "private" so many of those options weren't pursued. The decision was to not enable a direct conversation with the organization, to talk about things openly and publically. It seems at least to say that if one is lying, we'll do something of similar value to find out. If she did ask herself "who do you want to be", I don't know of course. But I'd like to believe that any of us who do ask ourselves those questions would slow down enough to consider and concept the moral choices as not "out there" but "in here". Did she want to be someone who enabled spying? Did she want to violate the privacy of her peers? Did she want to take a topic under the table rather than under the table? And did she choose that amongst ALL the choices that were available?

Filter Mechanisms to sort options:
I've often wondered if there is such thing as a regret-free decision, where we could neither hurt nor displease anyone. I'm not convinced there is. Because all of life is choices. When I deeply hurt my friend, I was choosing to "win" on a business topic that I thought meant the efficiency and value of dollars spent. I was using my full mind, and so I wondered why it was not coming together. "Why the tension," I remember thinking. I'll never really understand all the ways I made mistake in that situation. Yet now, I see that arguments represent an opportunity to see things anew. When we enter the world of the people we meet, we engage them not in arguments, but in conversation and stories. And if we listen enough and imagine a bigger picture, then we can usually create a universe that is inclusive. Not one that causes one to win and one to lose. But to create alternative possibilites to see beyond what sometimes appears to be an impasse.

Courage to act as we see right:
If you look at history, you can see that Martin Luther King, while admired today, was vilified in his time as being unpopular to some of his race, opposed by many in politics of that date and even ridiculed for having a dream of racial equity. Such is the case with Ghandi or Lincoln or so many other leaders. They had the fortitude and courage to act on their beliefs. But none of them did it alone. They had friends. They had people who believed in their vision as much as them. And that only reinforces to me that living a moral life is not a solo life. Your friends help you handle and evaluate options and find the courage to act. I can remember early on when I was trying to "change my ways" after I had ruined my relationship with this friend, I had a new type of interaction. This time it was with someone I thought was treating me wrong. And I wanted to argue, and demand. And I decided that was not who I wanted to be. A little group I was seeing regularly listened while I vented, teased me about going soft, but told me that I was doing the right thing. I felt both weak and walked upon. Yet, I was committed to trying and learning a new way of engaging that involved seeing the best in people and giving them room to act well towards me. Not because I demanded it, but because they wanted to. I was sure in my mind that I would "lose" and I was delighted to find I not only got what I wanted but more than what I wanted. I'm not trying to say it will do that all the time, because really what I'm trying to say is the outcome isn't always the point. The outcome is to get clear about who you are, and who you want to be so you can live in the world -- and live with yourself. I have come to define ethics as that which allows the broader interest of people and organizations to serve above their own needs. It takes great courage to do that. I saw Carly Fiorina last Thursday at the Churchill Club and I've been wondering ever since what would have happened if she had challenged the board to get honest with one another. Maybe she didn't because she thought they weren't ready, or she couldn't influence that kind of change. If she had, She might have still lost her job, who knows. But maybe she could have changed another 2 years of board leadership dysfunction. We'll never know.

Some final thoughts:

Morality and ethics in business are not often reinforced actively in our culture. And it's not as simple as a list to follow per se. It's a way of living and being -- of staying in tune with our inner voice and what matters. Each of us can develop some muscles of perspective that will help us live out ethical values. For those of us that want more guidance, we can join a community that helps us define, learn and live out values.

Why should we care? I started this rather long epic on whether ethical and business people were the same? The underlying word is people. Because it is not organizations that make decisions, it is people and when each of us and all of us collective make any of (each of?) our decisions to be more morally centered, than we will in effect enable a better culture, organization and perhaps even, a better world.

I believe business can be transformed from a place where CEOs line their pockets, and lying is discovered in the boardroom based on how we work, how we engage with one another. We can move from being experts on facts to experts on treating each other with the humanity that we need. Starting with understanding what decisions are moral issues, to defining "what should I do", to filtering mechanisms and sorting differently and having the inner fiber to act as we see right.

I wish I could end this with some report or statistic that says, if we live morally, business performance will rise by some astronimical growth x%. But I have faith that when we feed the roots of our business tree with good ethics, the tree will yield good outcomes. I hope you have faith too.

Technorati Tags:
Ideas that Create Value, Leadership, Authentic, Business, Ethics, Carly Fiorina

As the point of contact between customer needs and engineering realities, a product manager is the linchpin who can make a product into a market success – or doom it to irrelevance. This can determine whether a company lives or dies. Yet, I'm finding that many people don't really get product management. They often fail to give product managers the support, training, and empowerment they need to succeed. So this blog is dedicated to all of you Product Managers.
This is going to be my effort to put the supercape hero onto Product Managers and certainly share what I think they need to be successful. Note to all product managers: share this with your boss.

Gone are the days also of product managers creating a thing. Some of the existing concepts in the industry today are based on old-school thinking of what constituted a product. Think again of my Dell example. In the 80's, Porter's model focused on the competitive edge of a company being done by a silo function: design - manufacture - build - market - sell - deliver. You've seen me write about that in the new Value Chain. Product Managers have to be the first to get the product definition vision like this, otherwise the market will move from underneath the company. It was a 2 year cycle, and it was largely about defining an product and then shepherding that product to life.

That's so not the case anymore. Products are not the thing, solutions are. But I'll get back to that later. I've been thinking a lot about what constitutes market power in today's era. I think I have a notion that replaces Porter's model, at least in Technology and the web 2.0 era. [I'll blog on that soon.]

Why does product management matter?
In a word, globalization. More than ever before, efficient and low-cost companies in other parts of the world, some of them government-subsidized, have access to markets in the first world. Many of these companies specialize in the rapid, low-cost production of generic copies of successful products. A company based in the developed world can't win just by making a good product at a reasonable price. To survive, western companies must innovate – and they must make sure their innovations are compelling enough that customers will value them, even if they cost more. I would also argue that what needs to get made today is "solutions" and not "products". That requires inherently a broader aperture to understand the situation clearly.

• One of the most successful products on the market today is the Ipod. When Apple introduced it, the market for MP3 music players was commoditized, and dominated by no-name Asian manufacturers. They were playing a hardware game, and the customer was expected to do a lot of work to assemble the real solution. Apple created the iPod (the hardware) but what made it, it, was its accompanying iTunes music service. Apple's approach made e-music purchase and playback much easier than it had ever been before, and the market rewarded Apple with an estimated 70%+ share in the US market for mobile music players.

• The solution is also tied to who is using / deploying the solution. When selling dental implants and crowns, the customer isn't the person getting the implant, it's the dentist who sells the implant and installs it. For these customers, a major drawback has been the number of visits required to create and install a finished implant. The patient had to come in once for measurement, and then again days or weeks later for installation after the implant or crown had been created. Recently new systems, such as Cerec from Sirona Dental, compressed the process to a single visit. The patient's implant is measured in the office, fit is tested on a computer, and the finished ceramic implant is milled by an automated machine in the doctor's office – all while the patient waits. This increases satisfaction for the dentist's patient, and saves time and expense for the dentist. Sirona's insight was realizing that the dentist needed an implant production system, not just a medical CAD software program.

• On the consumer side of dentistry, Proctor & Gamble realized that there was increasing interest in tooth whitening as the Baby Boomer generation aged. But conventional tooth whitening meant either a trip to the dentist or the use of uncomfortable home-use trays that could make people gag. P&G combined its expertise in fabric bleach, toothpaste, and thin film technology to create Whitestrips, a product that lets people whiten their teeth by applying a thin bleach-saturated plastic strip to the teeth. Creating this sort of cross-discipline connection is one of the key tasks of product management. The result in P&G's case was a renaissance in the stale and commoditized tooth care business. Suddenly tooth whitening was easy and convenient, sales took off, and some reports show P&G's Crest brand displacing Colgate as the market leader.

The markets above for things are simple as tooth cleaning, music, and dental implants are vastly different, but the common thread between these solutions was that the manufacturer had an important insight into the customer's unmet needs and how they could be answered through solutions. Generating that sort of insight is the essence of product management done right.

How product management fails today
Theoretically, a product manager's involvement in the development of a product should be concentrated at the beginning and the end of the process. At the beginning, the product manager is responsible for defining the product – who it's for, what problems it will solve, and how big the opportunity is. At the end of the process, the product manager is responsible for feeding that information to marketing, in a form that they can easily transform into messages and deliverables.

The reality at many companies is that the product manager often gets pulled into the middle of the development process as a problem-solver. When there's a risk of a schedule slip, a conflict over resources, or a change in the market, the product manager often ends up attending meetings and researching options, which eats into the time available for their core tasks. We've worked with companies where the product managers are so overburdened that they can no longer truly lead their products. They can't do the up-front work necessary to define a winning product strategy, or the back-end work to make sure it's marketed properly. The result is inevitably mediocre products that don't hit their sales goals, and product lines that aren't well differentiated from their competitors.

A critical goal for any company's product management process should be to avoid this time trap.

Ways to get it right
To get consistent and insightful leadership from product management, a company needs to take several steps. Failure in any one of them can cause the process to fall apart. The steps are:

1. Create a corporate culture in which product management can lead.
2. Support product managers with information and peer groups that can help them succeed.
3. Train product managers to listen properly to three key audiences – customers, competitors, and their own executives.
4. Hire product managers and engineers who can work together.

1. Creating a culture in which product management leads.
In many companies, engineers are the kings and queens of the product development process. They build what interests them, or what they think some imagined customer would want, no matter what input they get from others.

Our favorite example at Rubicon of this thinking was an engineering director who once sent a memo to product management saying, "we've finished designing the product, now we need you to write the Market Requirements Document so we can do the launch." The company where that happened was once a major technology player; it's now on the verge of bankruptcy.

Sometimes engineering-led companies are successful. If they have brilliant engineers, or if they get lucky, they may manage to hit a sweet spot in the market. But most engineering-driven companies have very inconsistent results. Many of their products will win praise from technophiles but won't sell in volume. Numerous Asian consumer electronics companies are notorious for this, but they have cost structures that permit them to do "spaghetti development" in which they throw large numbers of products at the market to see what sticks. Western companies, with their higher cost of development, need a much higher success rate.

The ideal culture for success is one in which product development teams acknowledge the leadership of product management. They may argue about features and advocate their own ideas, but in the end the product manager makes the decisions and engineering carries them out. This is actually a two-way deal – product management should decide what needs to be done but let engineering figure out how to do it. A product manager who starts second-guessing pure engineering decisions usually ends up neglecting the work that only a product manager can drive.

2. Getting the right information and peer support.
Product managers' thinking about the market will be only as good as the information available to them. That sounds obvious, but it's surprising how many companies make major business decisions based on poor or sparse information.

Companies often depend too heavily on the advice of syndicated industry analysts. The analysts are valuable to get a point of view, but their advice usually reflects the industry consensus, and most of the analysis companies don't have enough budget to do original quantitative research in all of the markets they cover. That means most of them are relying on the things they hear from others in your industry, plus their own hunches. That's not a great basis for running a company. If I see one more person quote Gartner or IDC to confirm a market size or a market trend in a Concept Review, I think I'll have to barf. I'm serious. It's silly.

It's especially important to be cautious about industry growth forecasts. It is difficult for anyone to predict the future accurately, but asking an analysis company that doesn't do quantitative work to make a forecast is especially risky. The track record of most industry forecasts is remarkably bad. For example, in mobile phones the analysts overforecast demand at the start of the decade, and then have significantly underforecast demand in each of the last two years. Even worse, much of the growth has come from developing countries, at lower price points than most of the analysts expected. Companies that invested heavily in making expensive "smart phones" for the developed world, a market that was supposed to explode, have suffered. Mike Mace, who works for me at Rubicon, has written extensively on this topic, at his blog, and he is the key expert who can poke a hole at any bad number. I wish every team had him on their side.

It's important for a company to do its own original, balanced research as part of the product planning process. In the case of consumer products, or enterprise products deployed broadly, the research should be qualitative and quantiatitve (in other words, focus groups / 1:1 interviews with early adopters, plus a numerical survey). Doing this research yourself has two benefits. First, it ensures the quality of your data. And second, it allows your product managers to test the exact ideas they're considering. The more specific the research, the more actionable it will be.

The usual reason companies give for not doing this is cost. But skimping on research is a false economy if you're investing millions of dollars to develop and market a product. For smaller-scale projects, the Internet has made it much less expensive to conduct quick and simple surveys. A typical project by Rubicon costs about $45-60K to do an incredibly complicated set of 20 questions by 4 segments, and find real insights. There's no excuse for not doing your research.

3. Listening to customers, executives, and competitors.
One of the more common questions we hear about product management is why company A is successful and company B is not. The standard explanation is often that company A somehow does a better job of listening to its customers. But it sounds superficial, and perhaps even a little b-schoolish, to imply that success could be so tied to a single axis.

We like to turn the question around. Rather than asking who listens to customers, the thing to ask is who they listen to, and what they listen for.

There are three primary audiences a product manager needs to listen to:

The customer. It's critical to know what’s important from the perspective of those buying and using the product. Take lots of notes, but then sit back from all the specific input and ask: What are customer pain points? What are customers doing now to solve the problem? What can you do creatively to solve the problems? Remember that people can go on and on about things they would like to do, but won't necessarily pay for. The most important task is to figure out what they need, not what they ask for. We like to use these questions when defining new markets:

• What keeps the customer awake at night?
• How could a product (any product) or service solve that problem? What must it do?
• Why could you provide the best solution?

Executives. It's important for product managers to listen carefully to what members of the company's executive management team say about the product. Not because they’re in charge (although that's a good reason), but because a product manager needs to understand the key influences driving the company. What do the execs want to achieve? Is it share, is it growth, is it acquiring a particular customer segment?

Product managers who are listening for these priorities use them to guide product strategy. For example, say top management was interested in creating beachheads in new markets. That would mean pricing a new product high for short-term revenue optimization would be a very bad idea.

The competition. The most successful products answer unmet needs, or answer existing needs in new ways. To make sure a product will be unique, a product manager needs to understand what the competitors are doing and where they could be going. How do the competitors position themselves? Is there any unclaimed space, or a fulcrum where leverage could be applied to move a market? An assessment of the competition should include an analysis of their advertisements, marketing materials, blogs, and community forums. The goal is to understand how they describe themselves, and how others describe them.

Sometimes it helps to plot these findings on a quadrant or perception map. This can make it easier to spot new opportunities not claimed by others.

4. Hiring product leads and engineers who can co-collaborate
We see this problem most often in high-flying companies with growing stock values: they hire the most capable people they can find for every position in the company. This sounds great, but superstars often have the biggest egos, and it can be very difficult to get them to cooperate as a team. (If you're a sports fan, the best example of this ever was the 2004 Los Angeles Lakers, a team that was packed with superstars but self-destructed in the NBA finals.)

In our experience, companies are most effective when they hire people who are well suited to their roles. It's usually better to have a "B" player who knows exactly what to do than an "A" player who tries to do everyone else's job for them.

In the case of product managers, that means hiring people who are good at setting direction, understanding customers, and persuading others. Product management is a classic influencing job in which success is defined by persuading other people to do things. The product manager must be able to get out of the way of implementation – as we mentioned above, a product manager who tries to micro-manage any part of the implementation process will fail.

Product managers also need to be teamed with people who are willing to work with them. Their most important peers are the product development staff. If the product developers are intent on setting their own direction, the product manager is doomed to failure from the start. It's usually better to hire a good engineer who'll work with a team than a brilliant engineer who refuses to take direction.

Hit products like the iPod aren't the result of a single genius being struck by a lightning insight. They can be designed systematically through the right combination of processes and leadership.

Good product management is the key to making that happen. Good product management can make good companies, great. And ultimately they are the key to company success for the long run. Get that cape on, you're going to need it for how high you're gonna fly.

Technorati Tags:
marketing, Strategic Planning, Product Management

Two people are playing some rather competitive games. It's causing frustration. Lots of it. And it's taking their eye off the ball -- the marketplace, the competition, the changing customers' needs. And if there's one thing I wish I could do before I leave this earth is to end this cycle of wasteful behavior.

People often think they can work with some people and not others. But I'm not sure that's true.

Dislike and like -- at extremes, love and hate -- cannot live in the same heart. Think of the happiest persons you know. They probably don't love just their spouses and kids, and hate a number of other people. I'll bet they have a smile for everyone and something good to say about almost anyone. They probably have no fear.

For the most part, dislike is fear manifested. Competition in workplaces is often about fearing we are inadequate so we put others down to feel better about ourselves. We only dislike the things we're afraid of. When someone hurts us terribly, we often hate him for it, but we hate him mostly because we're afraid he'll hurt us again -- either literally or in our minds, which relay the scene of hurt again and again. If we each had the power to stop him from hurting us ever again -- even in our memories -- our fear would fade. And our hate or dislike would just become hurt, which can always heal.

Next time there's a rift at work, look at what is really going on and see if you can get to the root of that issue -- human to human. And then get back to work doing the things that create real value in the world.

Technorati Tags:
Leadership, Authentic

“Before you can inspire with emotion, you must be swamped with it yourself. Before you can move their tears, your own must flow. To convince them, you must yourself believe.”—Winston Churchill

Technorati Tags: HP, Goodness, Business, Ethics

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Do you remember a time when most meals were the sit down, full-service, dessert-included kind? Even if all you wanted was a cup of soup or a simple salad, you were offered the blue plate special with everything at one price. Then the culinary folks came up with small plates, a la carte items, tastings, pairing menus, buffets and the like. Whew! Choices - who knew!

So is it any surprise that high-tech companies have stopped serving everything one way with a side of structured licensing? Where once companies had to select / install / customize / upgrade, now we’re allowed to use smaller-scale online services that do one thing really well, without integration and without customization.

It’s a different era of software delivery models. As proof, a few weeks ago, IBM started charging for software based on “processor value units.” A recent article by Stephen Shankland of CNET announced the change on 7/25/06, calling it “one of vocabulary,” but it’s becoming clear that the utility pricing model I’ve written about for the last 2 years is about to become commonplace. In the same article, Jeff Tieszen, an IBM spokesperson, said that Big Blue is moving toward a pay-per-use (read: utility pricing) model.

What does this mean? Anything? Nothing? Probably a little of both.

To take a look at it, let’s look at the new name of this delivery model: SaaS (software as a service) in depth.

SaaS: What is it?
I know a lot about SaaS. So do you, but you may not know it by that name. It is typically:

- software that’s viral (anyone can download it and try it out)
- that generates value for an end user (so they’ll have an incentive to install it)
- that doesn’t require any data entry or training (so users can work with it instantly)
- and that generates immediate value (he called it "value first, pay later")

Anything strike you when you see that list? Do you think of salesforce.com, Skype, IM, Quickbooks Online, Six Apart’s Movable Type, Google Desktop. These are all SaaS solutions. These range from simple to sophisticated, but they all have in common scalable offerings, hosted within firewalls and they’re taking over traditional software release cycles.

SaaS is a delivery model rather than a specific market or type of company. It could be described a software-on-demand model similar to the time-sharing systems that many of us grew up using. The hosting and licensing fees are not distinguished.

Why does it matter?
SaaS uses a utility pricing model rather than term licensing. Utility pricing offers benefits to both the creators and consumers / customers as customers pay for usage rather than access. This means new customers are not required to make a huge financial commitment up front while offering lots of upside to publishers from heavy users. If you are a consumer, you no longer need to buy a $299 package of Microsoft Office, you could use Google desktop instead.

In the same way as full-service comprehensive meals went by the way side in America, technology companies can’t hope to retain customers just based on a huge, upfront financial commitment. With SaaS and the related business models, that gigantic check so beloved by your CFO just disappeared.

Key Changes in Sales Model Driven by SaaS
The selling and marketing model changes profoundly if you’re trying to get an online service deployed virally in companies via end users, as opposed to selling down through IT managers. Most of today’s enterprise software companies don’t have a clue how to sell this way, and it makes them extremely uncomfortable. Selling to the end-user requires a different voice, approach, sales model, licensing vehicles, pricing structures, and service follow-through than selling to IT buyers.

It’s easy for companies to underestimate the depth of the changes required to make SaaS work. In addition to a very different sales and marketing model, SaaS requires a completely different engineering structure and processes. Even the existing code base must be rewritten to support delivering it as a service. Because these changes are so wrenching, it’s very tempting for companies to make more superficial alterations and convince themselves that what they’ve done is good enough for now. They’ll add a web interface to their product and offer a hosted price option (carefully tailored not to cannibalize the current product line), and then they’ll wonder why the new initiative fails.

Substance Trumps Superficial
A colleague on the Rubicon team, Mike Mace, points out that the SaaS situation is reminiscent of the Melanesian cargo cults that proliferated after World War II on some Pacific islands. After the war ended and the soldiers went away, islanders tried to make the cargo come back by imitating the superficial features of the soldiers – they painted uniforms on themselves, marched in groups, and built things like air strips.

Companies trying to implement SaaS by copying its superficial features are basically technology cargo cults. Unless they make the fundamental changes that SaaS requires, they’re going to get about as rich as those island natives, marching around in the hot sun and wondering when the airplanes will arrive.

What’s Not to Like?
The case against SaaS cites a couple of major barriers to its broad deployment. One is data security. Large, traditional firms are very concerned about securing their data against both loss and theft. The idea of allowing that data to be hosted someplace on the Internet is daunting, if not downright terrifying.
The second barrier is scale. Many software services are being architected as quick-turn projects, without a lot of thought to long-term maintenance and how they’ll scale to handle large numbers of customers and more complex feature sets. This has even sometimes affected Google, whose blogging service, Blogger, has been plagued by periodic outages and data loss. Consumers can live with that (sort of), but it would be utterly unacceptable to a large firm.

The fact that a service interruption at Six Apart or SalesForce.com hits the Wall Street Journal headlines shows you the impact of those ‘interruptions.’

The SaaS skeptics conclude that it may get some traction at the edges of business, but will never be ready for the most demanding, mission critical corporate tasks, especially in the enterprise.

An Inevitable Change
Certainly in the next 12 months, the challenges in the SaaS world will prevent it from taking over the entire software industry. But major transitions never happen that fast anyway. We think it’s a good time to go back and re-read Clayton Christensen. In The Innovator’s Dilemma he did a great job of describing the gradual process by which steel mini-mills bit off pieces of the steel industry, starting with the lowest-value products that traditional steel companies didn’t care about deeply.

We see the same sort of process happening in SaaS. The easy targets and the smaller customers are being nipped off first. But over time SaaS implementations are becoming more and more sophisticated. We also see SaaS companies starting to create versions of their services that are designed to scale and that companies can host within their firewalls, reducing security concerns.

The best services, will replicate a process similar to what Research in Motion did with Blackberry e-mail. The first Blackberry systems came with a small desktop application that took care of passing messages to the mobile device. Over time, as the number of Blackberry users in a firm grew, RIM sold servers to the IT department that took over from the desktop component.

That process - get the users hooked, then sell to IT after you have established an installed base - lends itself perfectly to small guerrilla organizations like the SaaS companies. They can grow under the radar for a long time. By the time they’re competing for the biggest corporate accounts, the rest of the market will have already switched - and it’ll be too late for the incumbent software companies to do anything about it.

Be sure that’s not you.

Technorati Tags:
SaaS, Emerging Software Trend, Business

Yes, there is. Surprise you that I would say that? In relationships, power is not the key to connection. So, don't deceive or cajole in personal relationships, where trust and connection are key.

Yet in business, where revealing intentions can be revealing your IP. Don't do it. Ever.

As Mike Mace on my team says, if they like it, they'll steal your treasure. And if they hate it, you lose credibility. Where's the win in that? Just think, does anyone know Google's plans? No! Does anyone know Apple's plans? A few! And aren't those two some of the greatest pioneers of innovation. Yes! I would advocate there's a linkage behind this and not just a coincidence.

So when you are developing a new consumer product or direction, keep the industry off balance and in the dark by never revealing the true purpose behind your actions. If they have no clue what you are up to, they can't put up their shield, or poke you with their spear. And they certainly can't find your treasure before you do. Then, by the time you do reveal your intentions, it will be too late. Robert Greene's book on the 48 Laws of Power talks about this principle. And while I never thought I would agree with his notions, I find this one rule a necessary part of Innovation.

Eric Klein just let a group of friends know his latest news, when it was right.

I can finally stop answering the "what do you do?" or "who funded your startup?" questions with vague and concealing questions. Why? We've left stealth mode! My company is officially Dash Navigation, Inc., or more simply, Dash!
I manage Product Marketing for this amazing startup! I can't talk about the product yet, but if you some of the press running about us in the next few days, you'll see the tip of our iceberg. We're going to re-invent the auto navigation space by solving the real problems drivers face in their daily lives. It's all about being connected to timely and relevant local information while in your car ;-)
We'll be at Demo in San Diego on September 25-27 to formally show off what we've been working on these past months (for me) and years (for Dash).

Eric, let it be known: I want in the beta. And good luck. You deserve it.

Technorati Tags:
Market Entry, Dash

Yesterday, a client of ours came in for a quick-stop 'consultation' to review a business strategy linked to a VC pitch. [We're experimenting with a new business model for smaller firms.]

In our discussions, the client used personalization about 15 times. But the product didn't have personalization as the Valley technology Web 2.0 crowd thinks about it. It had customization which took a push technology (so web 1.0 some might say) and put a field into it that allowed someone's name to be integrated. And it got me thinking about how words without the common wiki definition of meaning can thrown around by those who are less familiar with specifics, and it all just sounds like blah, blah, blah. And by blah, blah, blah, I mean the blather of content that Scott Adam's created for the pointy haired boss.

On a related topic, Wired magazine has a great visual this month (September edition) of Web 2.0 markets:

It reminds me immediately of Dilbert's Business Plan Generator.

It's a mix and match set of terms to combine adjectives, verbs, adverbs and nouns to create a business strategy. Here are some examples:

We strive to seamlessly facilitate ethical paradigms and assertively integrate business intellectual capital while maintaining the highest standard.

And:

We interactively coordinate high-payoff technology while continuing to conveniently enhance performance based products to stay competitive in tomorrow's world.

And:

Our goal is to completely disseminate cost effective data so that we may continually integrate long-term high-impact methods of empowerment.

Classic!

Going back to the topic of personalization vs. customization. I think a great article describing the difference is here.

But remember that most of consumer technology stuff is something people made up and then found someone willing to buy. I profess to have done this with web authoring software, and countless other tools. Consumer marketing is demand-creation focused.

No one ever thought they needed a treo until they had one. Or post-its until they used it, or krispy kreme donuts until we had some.

And while all of us in Silicon Valley get enamored and excited about the next big thing (say...animated, personalized ads served up on mobile phones), the general lay population mostly fear technology because they don't understand it.

So when technology companies get all crazy about pushing their latest innovation instead of resonating with people in a common sense way, they've bought their own b^$%#%*t. What they think is important is the technology, when in reality it's about explaining how this new "thing" will make life faster, better, more luxurious, increase connections, etc.

If you're doing consumer marketing, this is the thing to remember. Whenever you have a chance, talk to your customer as if they fear technology and then share with them why it will help them to be better people and create better connections. Think Iowa, not Palo Alto.

Technorati Tags:
Consumer Marketing, Language

We believe money brings freedom.
We believe seeking happiness through security will fill us up.
We believe seeking happiness through status will fill us up.
We believe seeking happiness through power will fill us up.
We believe seeking happiness through posessions will fill us up.

But as my own life story will attest, it does not.

But you know what does?
There's no one answer, right. But I hope you know yours.

When we recognize our place in the world and that money is not the key, then we can can focus on the things that matter. For me that list includes those things that allow each of us to operate from our gifts, to give and play, and love the things we get a chance to create and the people we get a chance to co-create with.

Let's get over ourselves, people. We don't need a fancy car or a cool watch to be happy.

Technology companies have typically not done this kind of thinking and insights on their customer behavior.

But as consumer technology companies get more sophisticated, it seems both relevant and economically right to know what drive purchase, what media works, what role price has in the decision, and what will drive more sales growth.

Key questions the company needs to answer include:
• How powerful is brand in the new purchasing process?
• How many brands does the customer consider?
• How much is the technology an impulse buy, versus a carefully considered purchase?
• For those who obtain the technology bundled with something else, how likely are they to renew?
• Is your technology becoming a built-in feature that most customers expect to get for free?
If so, what percent of the customers feel that way?
• How does the awareness and consideration process work by segment?
• What are the triggers to adoption in retail (kiosks, software box, rebate offer, etc)
• Do people choose their vendor / brand / product before or after they visit the channel?
• For those who do visit the channel before making a purchase decision, what percent are influenced by various promotions (coupons, discounts, rebates, etc)?
• How do customers gather information? Word of mouth? Magazines? Online research?
• How do these correlate to the channels where they buy?
• How likely are they to repurchase the same brand in the future?
• To what extent do people now expect technology x to be a built-in feature of other things they buy, rather than a separate purchase?
• To what extent does the sea of boxes at retail affect the purchasing process?

The process by which consumers consider and purchase technology needs to be known to drive both strategic and tactical decisions. Not only do we marketing geeks need to know what drives their early awareness of product, but what factors get included in consideration and then ultimately whether online, retail, etc what causes them to buy. This will help any vendor to invest more wisely in the things that really matter and move from the mystery and assumptions of today to a clear set of tradeoffs.

By doing a piece of research to define the "Customer Decision Tree", you can find out what factors drive what stage of the decision and what you need to invest in to drive new growth.

Seems important. Why don't we do it more.

Technorati Tags:
Consumer Marketing, Nilofer Merchant, Business

Working in Silicon Valley, there are a few hundred new acronyms and technologies introduced each year that need to be understood. Being a trusted advisor means that clients need my firm and I to be really smart, on top of the latest trends, and interpreting what really matters so we can engage with them to design new, winning business strategies. We sometimes call it our brain trust role for clients. [does that sound arrogant, or what?!]

And one thing I’ve noticed and find to be true. Many of the things that get hype today won’t matter down the road. But there are always a few in the mix that need to be considered deeply. Figuring out the difference is hard especially with the high volume of noise that can exist in coverage of the next big thing the business press.

One item is going to change the paradigm of how products gets brought to market. The term I’m specifically asking you to be alert to is mashups. Mashups are when two technology companies can easily get mixed to create another value. I often think of it as Reese’s Peanut Butter Cups: two great things that when combined create something new and better. Mashups are fundamentally that. Two ideas or ‘solutions’ that are interesting become better when brought together. A couple of examples: put a publicly available database of housing transactions together with easy mapping technology and housingmaps.com or zillow.com get created so home value appraisals can be done on the fly. A related model: A Ford Mustang collector might “mashup” his database of Mustang clubs (by GPS coordinates) with the functionality and content of Google Maps. The resulting visual would produce club locations overlaid interactively on top of a map within the context of a web browser – a mashup.

Why does it matter?

There are two answers.

The first is technology-focused. Product development cycles will need to change. Ask five developers why mashups matter, and you’ll probably get at least that many answers. Typically, mashups use the functionality and/or content from two or more sources to create a new work. At least one of the sources is third-party to the developer. The most common type of mashup is a combination of multiple sources that the mashup developer had nothing to do with. John Musser maintains an index of all types of mashups at ProgrammableWeb.com. Some Web site operators want to increase usage of their content and functionality and provide application programming interfaces (APIs) for developers who use Javascript and AJAX for mashup development. In addition to keeping an index of those APIs, Musser also charts their popularity based on the number of mashups that use each one.

As a result, engineers can create software anywhere (anywhere = cheaper), and do quick integration with other pieces of modular software. Ease of development is hugely enhanced. And that’s the real risk to existing folks. Smaller companies with very low cost overhead can be speedy and build little ‘bits’ of solutions that can be mashed with other ‘bits’ and ultimately new value is created. Fast. Oh, did I say that already? That’s the key here so it’s worth stating more than once.

Companies that continue in the “old” development model - 18 month release cycles - are using “Titanic” engineering models and they are vulnerable. I call them dinosaurs with some affection. They are the big guys who have built the packaged application business. I love them and have several as clients but man have they got to adapt to this new paradigm, and fast.

The second is related to the customer value chain.
And the other interesting element is that the way in which customer value is created has shifted, dramatically. Mashup business models allow different, somewhat disparate technologies to be brought together fast. The underlying social aspect is that the way in which customer value is created and delivered can become more a ‘mix and match’ model.

Think back to the 80’s and early 90’s. The value chain examples used back then were Dell, and Intel. Value was created in what seems a linear fashion. First a product was designed, then parts purchased, then manufactured, then marketed, sold and delivered. The one who could own the full design to delivery could generate most customer value. The goal in optimization back then was to look at how to get good customer insights early in the process, because you needed a long ramp to get to market.

In the mashup world, one company doesn’t have to innovate all the development pieces. In fact, the idea isn’t to think about the value as the ‘thing’ as a computer is. Instead, customer value can become really about the usage of what someone needs.

In the new era, different parts of the value chain can operate as silos. Let’s use a non-technology example. Safeway, a grocery chain, might think they are in the business of supplying groceries, and possibly meals. But the reality is that they are one part of a larger effort. If someone is going to throw a dinner party, then they might use Evite to generate a list of guests and gather RSVPs, they might use Microsoft Excel to put together the recipes and calculate the recipe sizes. Effectively, they would go ‘offline’ to plan the meal. Then they would use Safeway to buy the food.

Another part of the value chain is to clean the house (if you’re into that kind of thing), cook the meal and serve the meal.

There is no one company in the chain that thinks of themselves as serving this unique value chain. But the customer has a unique value chain they must assemble for themselves. Through mashups, it could be possible for Evite to link to recipes and recalculate the supplies needed based on RSVPs, and then generate a shopping list and complete the solution.

And that is the big idea. Through mashups, any one company can link easily to other parts of the chain. If Evite ends up delivering the full ‘party creation value chain’ then Safeway could be circumvented. Any part of the value chain can end up connecting the dots for the customer and thus create the value the customer is truly trying to generate.

And disruptive as the idea of getting displaced by adjunct businesses is, know that parts of the value chain can be ‘free’ and supplemented by the economics of another. Effectively, it’s become a ‘mosquito world.’ Mosquitoes could surround the dinosaur’s revenue stream, draining it of its nutrients. We don’t have to go too far down the path to see the dinosaur being killed by mosquitoes that can survive and thrive on 10% (or less) of the dinosaur’s take.

Tips to Survive and Thrive
Being fit for this new type of competition is going to be challenging. Partly because you don’t where the competition is going to come from. So here are some ideas for surviving and winning this new type of circuit.

1. Acknowledge that you’re not in control.

Your entire approach will shift to meet the changes that are occurring as Web 2.0 continues to roll out. More than anything, it’s a perspective that things as they’ve been is not how they are, or will be. In fact, go beyond that and embrace change. It means you’ll be able to offer a continuous supply of products to meet current and future customer needs. Know that when you’ve historically done research, you’ve been getting answers in your context, not necessarily in the customer’s context.

2. Develop some Flexibility.

Training to survive in this new paradigm of mashups is a unique training philosophy. And so for this summer’s boot camp, I need you to know what to look for. First off, the natural instinct of most my clients’ is what I’d call ‘get tough.’ In that case, it would be much like training for a marathon. If you were training for a marathon, you’d likely create a predictable schedule: one full of long, steady, grind out the miles days, and work out harder model. Being consistent and dutiful would be the key to survival if you were running a marathon.

But the world of mashups is exactly the opposite of running a marathon. It’s more like being an Acrobat. An acrobat actually doesn’t know which muscles they’re going to use. They could be doing handstands, pull ups, dangling from 1 leg, or jumping from one thing to another. It’s a multi-disciplinary level of fitness. Think about how to have a diversity of talents available to you.

When you’re hiring, make sure you’re building a team that is diverse enough to allow your efforts to be flexible.

3. Rethink the Value Chain you are involved in.

You might think you are in the ‘grocery chain’ business, but you could be replaced by the real customer values of ‘needing to throw a party.’

4. Think about how to replace other parts.

Or at minimum to pass orders from step to step. Look at combining services in such a way to make yourself integral to the customer solution.

5. Play well with others.

You can partner rather than build it all. Partnerships and strategic alliances generally improve your whole product marketing and delivery system. It gives you the opportunity to identify valuable third party relationships needed to provide a complete service solution to the customers. In the case of a new market segment, this can mean multiple companies growing the category.

6. Work on speed.

Think you can’t invest in developers and next gen technology? Think again. The recent launch of Sidekick 3 set off a flurry of interest and buying by loyal T-Mobile customers. Why? They have an insatiable appetite for technology. . So, establish ways customers can provide input. Whether it’s an advisory board, a customer service wiki or blog comments, make sure you’re open to hearing the customer value chains they’re developing real time. Then listen.

Remember that the key to winning this new market model is flexibility and ability to adapt to highly changing conditions. So jump and skip and hang. And then leap forward.

[this article was originally written for Marketingprofs.com. They published it August 1, and I wanted to share it with you also.]