Shop Talk - Innovation, Marketing and Alliances

We have moved

2009-03-04T17:07:00.000-05:00

Shop Talk has moved to our new location.
There won't be any new posts here after that. The older archives will remain, however.

Please head over to our new home, which also contains the complete archive of posts.

If you'd like to update your RSS reader, here's the feed for the new place.

Thanks for reading us here. See you at the new place.

John

Customers are talking - candid customers won't give you 100%

2009-02-28T17:08:00.000-05:00

Two things happened to me recently that got me thinking about online product forums.

In the first instance, I was looking for an inexpensive hotel in Las Vegas. Deals abounded, but complications arose when I looked into the customer comments published for each hotel. Here's an extreme example:

Room was not in the main tower, it was right by the parking lot and the tunnel you had to walk through to get to the room smelled like puke and urine, also very hot. The door to the room beside us looked like it was ajar so I gave a little push, on the bed was a naked man laying there. Looked like he was waiting for someone to come into the room. I quickly closed the door and retreated back to our room. A few minutes later I looked back out and the door was ajar again. I think he was for hire. Was very scared because there was an adjoining door. It was very late and were very tired so tried to get some sleep. NOT! So much noise. Twice that night someone tried to open our door. Very scary. Cockroaches in bathroom in morning. Also very squeeky bed springs in room above that continued sqeeking for a long time (must be Viagra) Funny coincidence the room number was 169. This hotel is the seediest most unsafe disgusting place I have ever had to stay in. Never ever would go back.

Needless to say, I stopped looking for the lowest-cost deals after reading stuff like this.

Soon thereafter, I was one of a number of folks who received the same email from a friend, who had just opened a new business in town. She felt that a user review in Yelp.com, which had some criticisms, needed to be countered. To my friend, the negative statements were damaging. To me, as someone who works with helping companies listen to customers, the feedback was valuable and could be useful to her.

These two examples underline that even if you're the Ritz-Carlton (never mind the hotel with the naked man on the bed), you will not get a perfect score from your clients. Not if they're being candid with you. They will point out things that bothered them, that didn't go perfectly, that are chronic weaknesses. Ignoring these forums or getting defensive is not only unwise, it's self-defeating.

I wrote to my friend who has opened the local business. I told her that the Yelp review, while not 100% positive, did say many positive things (among which was that the reviewer had visited several times and planned to go back again--a strong testament). The negative things were accurate and, happily, could be easily addressed.

I recommended to her rather than try to debate the reviewer, take her comments to heart, act on them, and invite her back for another look.

I don't know what to say to the owner of the hotel described above. Suffice it to say I won't be staying anywhere near it.

Facebook, smacked down again, invites customer input

2009-02-27T10:35:00.001-05:00

Facebook always does the right thing by their customers... once their customers have beaten them up for a wrong first step. A year and a half ago they stirred up the wrath of their community by proposing an ad-targeting system leveraging its users' profile data, then backed down.

Now they've done it again. Facebook changed their terms of service, igniting another storm of outrage on blogs, Twitter and, yes, Facebook. They relented, returning to their prior terms of service, and yesterday announced that they will be seeking user input on community questions such as terms of service, and be more transparent, including this statement:

Transparent Process: “Facebook should publicly make available information about its purpose, plans, policies, and operations. Facebook should have a town hall process of notice and comment and a system of voting to encourage input and discourse on amendments to these Principles or to the Rights and Responsibilities.”

It's easy to make fun of Facebook for their public embarrassments, but they do get the message their users are sending. Furthermore, they are pioneers in engaging with their users. There is no template they can follow. Facebook's users, because they give personal and sensitive information to the service, is very sensitive to its use, and the web2.0 nature of Facebook means that its users are comfortable using web2.0 means to communicate. Quiet they are not.

It will be fascinating to see how more traditional companies deal with assertive user bases. As consumers find their voices on line (and efforts like VRM give users powerful tools to manage and communicate with their vendors), we'll be reading more stories like this one. Will other companies learn from Facebook's painful lessons?

Related post:
Zuckerberg learns

P&G, in moving into services, can learn lessons from Disney

2009-02-25T09:53:00.002-05:00

NOTE: We will stop posting new material to this blog location as of Friday, Feb 27. Please visit our new home, which also contains the complete archive of posts. If you'd like to update your RSS reader, here's the feed for the new place.

I read with interest the recent HBR Editors' Blog posting speculating on the difficulties Procter & Gamble might run into in its effort to create a chain of car wash franchises, called Mr. Clean Performance Car Wash.

When I read the post, written by marketing professors Neeli Bendapudi, Randle D. Raggio and Tassu Shervani, we were in the midst of a vacation in Orlando, Florida, at the various Disney parks. So, the connection between what P&G is trying to do now and what Walt Disney kicked off some fifty years ago came to me instantly.

The upshot of the HBR post is that product and services businesses are dramatically different, in particular the need for a service business to deliver an experience over and over again, consistently and of high quality, despite the innate variability of people, locations and customers.

With this in mind I monitored my Disney experience for the rest of the week for lessons that could help P&G.

Brand gets people to try your service; blocking and tackling gets them to return. The Disney properties flaunt the characters, movies and TV shows at every turn. Yet after an hour at the park, you notice that trash cans are always close by, so that if you have an empty cup or candy wrapper, you don't end up holding it for more than a few seconds before finding a place to discard it. As a result, the park is exceptionally clean for a place holding tens of thousands of guests.

No detail is too small. Kids are royalty at Disney (a significant differentiator compared to most places where they are seen as messy, noisy attention-seekers--which, of course, they are). The bag checkers, waitresses, salespeople--in short, every "cast member" we encountered--took special care of our kids.

Consistency reduces stress. Each of the four Disney parks we visited had a similar parking scheme, shuttle bus protocal, and entry design. Which meant there was very little standing around head-scratching and wondering which gate to go through or which bus to board.

Customer recognition builds loyalty. Everywhere in the parks I saw guests wearing buttons saying "My First Time!" or "It's My Birthday Today!" These simple gestures to recognize guests made their experiences special, built warm memories, and encouraged them to return.

I'm rooting for P&G in their Mr. Clean car wash project. The above lessons are like much good advice--easy to understand, hard to implement. Whether P&G can execute, and the marketplace and the economy cooperate, only time will tell.

Customers are talking - Tropicana hears feedback, brings back old carton

2009-02-24T14:37:00.001-05:00

Sometimes the roar of customer feedback can force a multi-million dollar capitulation. Today, the New York Times reported that Tropicana, a unit of PepsiCo, was responding to a wave of negative customer feedback to its recent change in packaging. The Times writes:

Redesigned packaging that was introduced in early January is being discontinued, executives plan to announce on Monday, and the previous version will be brought back in the next month.

Also returning will be the longtime Tropicana brand symbol, an orange from which a straw protrudes. The symbol, meant to evoke fresh taste, had been supplanted on the new packages by a glass of orange juice.

The about-face comes after consumers complained about the makeover in letters, e-mail messages and telephone calls and clamored for a return of the original look.

Some online reaction to the new Tropicana package is here and here. (And, to be sure we stay fair and balanced, here is a rave review of the new package.)

One wonders what kind of testing process Tropicana used for the new packaging. I would hope that they used the approach that online services use today--which is to roll out new looks to a limited audience and listen carefully to the feedback before rolling things out across their base. But if so, they would have gotten this feedback far faster and before it became a national news item.

Packaged-goods companies tend to be secretive with their makeovers, often keeping details hidden until a widely publicized, nationwide rollout. The result of this strategy, though, is not hearing feedback, positive or negative, until a great deal of investment has been committed. Meaning a rollback, like Tropicana's doing, is terribly expensive (and highly-publicized).

I wonder how Tropicana will handle their next packaging change?

Last Week for Shop Talk at this address!

2009-02-23T17:13:00.002-05:00

Shop Talk is moving to a new location at the end of this week.

We'll be closing the doors on this location on Friday. There won't be any new posts after that. The older archives will remain, however.

Please head over to our new home, which also contains the complete archive of posts.

If you'd like to update your RSS reader, here's the feed for the new place.

John

Time for a humbler, more focused, wireless wholesale market

2009-02-23T09:19:00.001-05:00

The US MVNO market is the greatest missed opportunity I've seen in my wireless career, stretching back almost 20 years. Through carrier resistance and MVNO hubris, a business model that works very well in Europe and Asia has floundered here. Strong, focused MVNOs, which manage their costs and market excellently, improve services and value for wireless users in many places outside the US.

Yet there may be a light flickering in the US market. It's been several years since the meltdowns of Amp'd, Disney Mobile, ESPN and other high-profile players. The iPhone and its imitators have demonstrated the value of a (relatively) open architecture and application environment. And the carriers are still no better at rolling out truly innovative services than they have been.

Plus, nationwide carriers #3 & 4 (Sprint & T-Mobile) trail far behind the leaders in market share. This creates a strategic scenario where a customer acquired by a Sprint or T-Mobile reseller is relatively unlikely to poach the direct business of the wholesaler (and in Sprint's case, they should welcome retaining customers by any means, even if they are transferred to an affiliated wholesaler). Therefore, the perceived opportunity cost of a full-on push into wholesale by these carriers is lower.

Who will be tomorrow's resellers? Those that are laser-focused on markets unserved by the carriers. They will be smaller but profitable, with excellent, low-cost distribution channels. They will be true innovators, bringing high-value applications to their customers. They will have customer bases who purchase phones without subsidies. They will be able to create win-win agreements with the wholesalers.

In a perfect world, a Sprint & T-Mobile push will force AT&T and Verizon to re-enter the wholesale market. Then there will be a strong, vibrant, competitive market where resellers will have some control of their destiny.

And the biggest winner of all will be... the customer. You and I.

Ten Bucks

2009-02-19T20:21:00.001-05:00

When I was a teenager, the stores in our town stayed open late on Thursday nights between Thanksgiving and Christmas. In 1978 I worked at one of the local hardware stores and I was on duty one of those Thursdays. I had earlier that day cashed my paycheck. Around seven or so, business was slow and I asked the manager if I could take 15 minutes and walk up to The Gramophone Shop. I went in and bought a record I had had my eyes on for a number of weeks: Dire Straits' first album. It cost, by my recollection, $8.98 plus tax.

Was that album worth ten bucks? It's a stupid question. That album was part of the soundtrack of my late high school years. It was probably worth $100 to me.

Now it seems that people who spend ten bucks on music are stupid. Free mp3's are everywhere, legitimately or otherwise. Subscription services and internet radio stations offer everything at the touch of a browser button. There's a sea of music out there, just waiting for a listen.

But paying ten bucks for an album caused you to make a decision. (Not that those decisions always worked out. For example: the Knack's second album.) You had to hear enough songs to get a good assurance that the album was decent, or take a risk that the one great song you heard was a pattern for the rest of the album. (Also not foolproof; see Sniff 'n' the Tears.)

Carrie Brownstein's recent post on NPR Monitor Mix brought this to mind. Carrie lamented the decline of the record label, in this case the decision by Touch & Go Records to stop distributing the work of smaller labels. Wrote Carrie:

We are careening toward a paucity of experience and a paucity of means with which to evaluate music. I mean, can we really engage with art on a Web site and in a vacuum, without ever bothering to contextualize it or make it coherent with our lives or form a community around the work? If we never move beyond the ephemeral and facile nature of music Web sites -- and let's not lie to ourselves, that's where it ends for a lot of us these days -- then that makes us worse than blind consumers; it makes us dabblers. We have become musical tourists. And tourism is the laziest form of experience, because it is spoonfed and sold to us. Tourism cannot and should not replace the physical energy, the critical thinking and the tiresome but ultimately edifying road of adventure, and thus also of life.

To me, the process of getting recommendations, listening to a friend's record, hearing something great on the radio (or a podcast), then making the decision to plunk down real money is, in Carrie's words, an adventure--and one of the great pleasures in enjoying music. If everything's at your fingertips, undifferentiated, you can sample, skip and flit around. You're, as Carrie said, a tourist.

And to me that's a bad thing. Free music isn't only bad for musicians, it seems. It's also bad for the audience.

Guest post by Denise Lee Yohn - The Economy Made Us Do It

2009-02-18T22:00:00.000-05:00

I'm delighted to present today a guest post by Denise Lee Yohn. This is the first time we've done a guest post. I'm curious about people's thoughts on this--if you have an opinion, leave it in the comments. regards, John

It seems today's tough economic climate has become the ultimate scapegoat for pretty much everything.

This past week's New York Times Sunday Styles section included a piece describing the cleverness with which people have used the economy to get out of social obligations. From firing the nanny to avoiding a dreaded family reunion, the recession, it seems, provides a convenient excuse for folks who can't bring themselves to deliver an honest, yet unpleasant message.

And Business Week just ran an article about how companies are trying to get out of contracts by arguing that the economic crisis should void legal obligations. Although the troubled economy isn't technically addressed by force majeure clauses, companies in tight situations aren't letting technicalities stop them from trying to pull one over their creditors and business partners.

Such behavior seemed somewhat comical to me until I found myself on the receiving end of a similar excuse yesterday. It came from a service rep who relayed a change in the company's policy by saying, We've been hit hard by the economy so we had to cut some of our services and that was one of them. The momentary sympathy I felt for the company was quickly replaced by indignation against it for trying to excuse the change by blaming the recession. And my questioning of the wisdom of such a tack soon followed.

Now, I understand that economic pressures have forced companies to change the way they do business. They're cutting back and by definition that involves tough decisions. I get that. What I find curious is executing the changes in a way that smacks of avictim mentality. Why would any business want to give the impression theyre helpless and desperate?! Companies weaken their brand perceptions with a thoughtless --sorry, it's the economy -- excuse.

If companies want to retain any measure of respect and trust with their customers (respect and trust being key drivers of brand equity), they should assume responsibility for the decisions they make and use these tough economic times as an opportunity to reinforce their relationships with customers. A message along the lines of the following would be a good first step in taking a proactive, brand-building stance: Please accept our sincere apologies for making a change that we know adversely affects you. We are diligently working on ways to improve and will resume the suspended service as soon as possible.

Communicating this type of message -- and delivering a customer experience consistent with it -- has the power to transform brand perceptions. Instead of being perceived as a weak player thats relinquished control of its destiny, the business is portrayed as a brand with the integrity and customer commitment to come out of this economic storm even stronger.

With excuses to be found everywhere these days, I certainly hope we're not seeing the beginning of a trend that makes adopting an excuse culture-- an acceptable way companies do business -- but I fear it may be. After all there's an excuse, it seems, for everything from criminal acts to indiscretions by politicians. But business leaders should realize excuses erode brand credibility and equity.

Simply put, excuses are bad for business.

Denise Lee Yohn is an independent brand as business^TM consulting partner who inspires and teaches companies how to operationalize their brands to grow their businesses. World-class brands including Sony, Frito-Lay, Burger King, and Nautica have called on Denise to maximize brand impact. She can be reached through her blog, brand as business bites^TM.

From "Think Again," a book about decisionmaking gone wrong - Marc's mistake story

2009-02-16T13:42:00.002-05:00

"Think Again" is a great new business book in which authors Sydney Finkelstein of Dartmouth University and Jo Whitehead and Andrew Campbell of Ashbridge Business School describe research in cognitive science and behavioral economics to explain how the decisionmaking process goes awry and, even more importantly, how our minds obscure the mistakes we make and keep us from understanding the weaknesses in our decision processes. [The authors also have a website for the book, including pointers to some of the underlying research and other goodies.]

The book is full of great storytelling, and this one in particular, about an executive named Marc, seemed very appropriate for the Mistake Bank:

Marc was the managing director of the French subsidiary of an international manufacturer of packaging machinery. He was considering whether or not to acquire a company that had a near-monopoly on manufacturing a specialized type of food packaging machine. While the company had a strong position in the market, there were several warning signs that it was a risky investment. The business was highly dependent on sales to one large meat processing company. Because the machinery was a form of capital investment, sales tended to be highly cyclical. The management team had recently lost some of its more talented designers and marketers, and performance was flagging. The current owners of the business were keen to sell.

These risks were particularly an issue because Marc had committed to his head office that he would deliver relatively stable performance. The previous year, Marc had personally persuaded the head office to provide additional investment to his subsidiary for low-risk acquisitions, and so his reputation was at stake.

As the transaction progressed, some members of Marc's supervisory board voiced their concerns about the proposed acquisition. Despte this, Marc went ahead. A few months later, following the discovery of bovine spongiform encephalopathy (BSE), or mad cow disease, in French cattle, the meat-processing customer announced that it was putting discretionary capital expenditure, including the packaging machines manufactured by Marc's company, on hold. The management team was unable to deal with the dramatic drop-off in demand. Profits plunged into the red. Marc's superiors were shocked, and Marc's career received a large black mark.

Marc described why he thought he had made a flawed decision. "I was under pressure to do this deal for my own interest. If I went ahead, then the costs incurred in auditing and due diligence of the company would be capitalized and added to the cost of the investment. If I backed out, then they would all be charged to my office as an expense. Because we had been pursuing this company for a while, those costs were quite significant--and I guess I was influenced by that. I had an annual target to hit--and the charge-off would occur at the end of the financial year, leaving me no time to find a way to avoid a big loss. Of course, in the end, doing a bad deal was much worse for my position. I guess self-interest clouded my judgment."

Reprinted with permission from Harvard Business Press. Copyright 2008 Sydney Finkelstein, Jo Whitehead, and Andrew Campbell. All Rights Reserved.

Shop Talk relocating! Everything must go!

2009-02-11T20:10:00.002-05:00

As I mentioned last week, Shop Talk is moving to a new location at the end of the month.

In the meantime, we've sold our entire stock to a liquidator, so expect deep discounts, especially on 2006 and 2007 posts, which have been languishing in the warehouse for quite some time.

Please head over to our new home and stay awhile, and if you'd like to update your RSS reader, here's the feed for the new place.

John

Frontiers of innovation - Netflix demolishes own business model

2009-02-11T18:36:00.001-05:00

We've been Netflix customers for several years, and generally like the service. But we're like a lot of their busy customers. We don't turn DVDs over fast enough and end up having months go by with the same two movies sitting on the television.

But last week we bought the Roku box and now use it to view Netflix movies streaming over the web on our flat-screen TV. It's cool, easy, the quality is good and it's a great antidote for our laziness with the movies. Plus, you don't have to wait for the DVD to arrive in the post.

It's not perfect--there aren't enough titles yet. But it's a product that will only get better and more useful. And put Netflix in place as a contender to lead the integration of TV and the internet.

[Aside: I drove through Cerritos, California, today. In 1987 GTE, my former employer, trialed interactive television in Cerritos. Needless to say, they were too early--bandwidth issues, lack of content, and, frankly, the lack of a powerful vision of sharing and openness a la Tim Berners-Lee, doomed the project.]

What's so impressive to me about this is that Netflix is investing in technology and partnerships expressly designed to make their old business model obsolete. When I think about how much they have spent, in dollars and time and thought, on the sending-videos-through the mail model, I wonder how they were able to make the leap to say, "We have this process optimized, but it's not the future. Time to build a new model"--meaning internet streaming.

There's a word for this kind of behavior, and it's not a nice word: cannibalization.

One of the most repugnant terms in the language--referring to one of the greatest human taboos--is used when a company's new products take sales away from its older products. Perhaps this helps explain why companies go to such great lengths--even imperiling their long-term success--to avoid it.

The problem is, the marketplace is a bit like the jungle. If you don't eat your own, someone will eat them for you. And this has happened again and again. One example: GM's abandonment of the EV1 electric car just a few years before Toyota introduced the Prius. To survive, companies will have to get rid of that taboo against cannibalization and act more like Netflix.

[Another aside. I keep wondering if the Kindle is a similar eating-your-own innovation. But something tells me Bezos always knew he was going to get deep into distribution of electronic content, even back when he was just selling books.]

I have a suggestion for marketers. If you want to get approval to introduce a better product, instead of referring to "cannibalization," call it "upselling."

(Photo: crushed EV1s courtesy of EcoBlog)

Customers are talking: is a customer-service dialogue a story?

2009-02-10T11:18:00.000-05:00

Some of my work recently has been applying narrative-sensemaking techniques to customer service dialogues (typically recorded phone calls), which is a fancy way of saying helping companies find patterns in what customers are saying about their products and services, and to use these patterns to drive changes that will help them sell more products and/or make their existing customers more satisfied.

This is a little different from the more traditional approach of eliciting stories via interviews, anecdote circles or web forms. In those circumstances, carefully-crafted questions help generate stories ("this happened, then this, and then this"). Customer-service calls are not elicited--they are spontaneous expressions--and don't follow the story format. They are simply two people talking.

So a question is, I guess, can you get useful stories out of mere dialogue?

In thinking about this question, I've been reflecting on the novels of William Gaddis, an American writer who published only a handful of books from the 1950's to the 1990's. I've read two of them, "JR" and "A Frolic of His Own," and both have barely any exposition at all. 90+% of the text is dialogue, barely puncutated, overlapping, and often confusing.

"JR" is a very forward-looking book about a junior-high-school student who speculates his way into a multi-million dollar fortune (on paper). Given that it takes place in the mid-70's, JR does his trading via the payphone in the school hallway. Today, he'd be on TD Ameritrade.

"A Frolic of His Own," written in the 1990's, takes issue with the (again very present-day) issues of litigiousness and intellectual property. In addition to dialogue, hilariously-deadpan legal briefs help move the story along.

Reading Gaddis' books is a lot like listening to those customer service calls. A bit disorienting or hard to understand, often touching, sometimes funny. Always humanizing. And always stories.

A music affinity group emerges on Twitter

2009-02-09T04:43:00.001-05:00

One of the most fun things about messing around with Twitter is to see interesting things emerge. It's such a general tool that it's a lot like those college greens that architects leave without pathways, allowing students to develop their own patterns over time.

I've recently started seeing the emergence of a music affinity group on Twitter (one of many, probably). It occurred to me this is happening yesterday, when I got a follow from @peteyorn, a musician that I like but didn't even know was on Twitter.

How he found me, I don't know (perhaps Mr. Tweet does). Maybe it's my connection with @francisten from West Indian Girl, or @kmueller62 of WXPN (or even @fotteson, a local bass player). Maybe it's that I write about music a fair amount (including live Tweeting the My Morning Jacket New Year's Eve concert or my musical crush on NOMO).

At any rate, I've gotten follows now from @madalynsklar, @talkmusicnow and @sxsw. You can see the pattern emerging. And I like it. I want to know what musicians and music fans are tweeting about. I'll learn about new music & perhaps see a bit of the faces behind the records. It'll be fun to see how this group evolves over time. (And if you're a musician or music lover, give us a follow at @jmcaddell and I'll follow back. You can join the conversation then.)

Just another way @twitter is changing how we interact and learn.

Creative Destruction? #3

2009-02-06T10:33:00.001-05:00

This series of posts began in September when I photographed a couple of recently-vacated retail spaces. I've returned a couple of times since, most recently this week, to see how/if reuse of the sites is progressing. As you'll see, not much change yet. Here's Joseph Schumpeter's famous "creative destruction" quote from Capitalism, Socialism and Democracy:

The opening up of new markets, foreign or domestic, and the organizational development from the craft shop and factory to such concerns as U.S. Steel illustrate the same process of industrial mutation–if I may use that biological term–that incessantly revolutionizes the economic structure from within, incessantly destroying the old one, incessantly creating a new one. This process of Creative Destruction is the essential fact about capitalism. It is what capitalism consists in and what every capitalist concern has got to live in. . . .

32nd and Market Streets, Camp Hill, PA, 3 Feb 2009

There have been recent newspaper reports that there will be a Rite Aid drugstore built on the above site. And there is a construction sign posted out front (not pictured).

Carlisle Pike, Silver Spring Township, PA, 3 Feb 2009

The lease sign is the biggest change here. Otherwise, no activity.

Other posts in this series:
Creative Destruction? Sep 2008
Creative Destruction? Nov 2008

"Goals Gone Wild" - a bracing indictment of the business objectives culture

2009-02-05T10:59:00.001-05:00

"What's your MBO?"

That was a frequent question at one of my past companies. MBO meant management by objective, and was a way of asking someone what their goals were for that year. It's funny, thinking back on it, that the goals culture was so strong that we never gave MBOs a second thought. And who doesn't sit down with her manager at the beginning of each year to set out objectives?

In a new working paper by Max Bazerman, Lisa Ordonez, Maurice Schweitzer, and Adam Galinsky of Harvard Business School ("Goals Gone Wild: The Systematic Side Effects of Over-Prescribing Goal Setting"), the authors take a fresh look at the goals culture and see that, rather than be a driver of effective performance, "goals gone wild" have caused much damage in the business world. Here are a few examples:

Enron's growth objectives created an out-of-control culture inspiring market manipulation and outright fraud.

Ford's goal to build a small car weighing less than 2000 pounds and costing under $2000 by 1970 caused the Pinto to be rushed to market, with safety checks unperformed or ignored. The car's gas tank was prone to rupture in an accident and, as was learned, the car tended to explode on impact from the rear.

Sears' goal to increase auto service sales in the early 1990's to $147/manhour resulted in overcharging and unnecessary repairs.

Bazerman's work on behavioral effects in negotiation (including one of my favorite books of 2007) and decisionmaking is uniformly excellent and insightful. In this paper, he and his co-authors survey research showing how challenging goals, while creating a powerful incentive, also create significant negative side effects, including:

- focus on short-term results over long-term benefit
- favoring the easy-to-measure over the difficult to measure, independent of importance
- goals creating performance ceilings (e.g., the salesperson who stops selling after reaching her quota)
- reduction in cooperative behavior
- reduction in learning
- unwillingness to experiment and innovate
- decrease in intrinsic motivation ("Show me the money!")

It's not a pretty picture. I doubt after reading this that anyone would be more eager to set goals for their employees. It does a great job in laying out the risks of overreliance on goals. There's more work needed on how to deploy goals effectively, because that's the question that we're left with at the end.

Customers are talking - Apple hangs up on the wrong customer

2009-02-04T12:29:00.001-05:00

It's getting harder and harder to get telephone support, especially with online products, but there are some times you need to talk to a person--you can't find what you're looking for in the forum, for example, or your question doesn't fit neatly into a category.

Cluetrain Manifesto co-author Doc Searls called Apple to get support for MobileMe (a paid service, by the way), and a synthesized voice summarily directed him to the website. Then, "click."

The irony is that Searls heads a grass-roots effort called VRM, Vendor Relationship Management. Requiring adequate support for paying customers seems like a basic tenet of VRM.

So Searls blogged about it, including a recording of the Apple call. Check it out here.

A Business Owner's Novel Response to the Financial Crisis

2009-02-04T09:27:00.001-05:00

A local entrepreneur who's in the physical therapy/rehabilitation business told me about his approach to dealing with the financial crisis:

First, he gave up his lease on a large office and moved into a smaller one, cutting his overhead substantially. That's a tactic that would be at the top of anyone's list.

Then, he did something unexpected... he raised his prices. As a result, he lost some clients. But because of the lower overhead, and the higher contribution margin of the remaining customers, he's making more money.

As he said, "Basically, people who weren't valuing the service don't come anymore. The clients who are left really care about their health and are willing to invest in it. For them, the price is reasonable."

Anyone can cut costs. But cutting costs and raising prices? That's an innovative prescription.

Related post:
If you can raise prices, don't hesitate

Shop Talk is moving!

2009-02-03T13:05:00.003-05:00

Hi, all,

We've loved being here at Blogspot for the past three years, but it's time to move on. Given the economic situation, the landlord over at caddellinsightgroup.com gave us a great deal to consolidate our space over there, so off we go.

We'll keep adding new posts here for the next couple of weeks, but after March 1, we won't be posting new material to this space any more.

Please head over to our new home and stay awhile, and if you'd like to update your RSS reader, here's the feed for the new place.

Thanks for shopping!

John

Customers are talking: @comcastcares - not just conversation

2009-02-03T10:58:00.001-05:00

I recently spent some time with Frank Eliason, known to the Twitter community as @comcastcares. Frank has become a minor internet celebrity in the last year because of the work he and his team do resolving problems for unhappy Comcast customers who tweet or blog their frustration with Comcast.

His work is fascinating to me because Comcast is a gigantic, engineering-driven company and one which you wouldn't have expected to embrace a "customers are talking" approach.

I think there are two reasons Frank and his team stand out. One is novelty. There aren't a lot of companies who have prominent profiles on Twitter (Dell and Zappos are two others). That won't last, of course, as more and more companies jump on board.

The second reason is more sustainable. The term "conversation" is everywhere in social media. It's all about the conversation. Not for users of products and services. When they talk about products and services and companies on Twitter, it's not just to have a conversation. In many cases, it is to highlight a problem.

The Comcastcares team doesn't just engage in conversation. They solve problems. Here's an example (for readability, these tweets are ordered from earliest to latest--the opposite of how you would read them on Twitter):

The biggest reason for me Frank and his team succeed is that they are customer-service and tech-support people, not PR people. Frank in particular has years of call-center experience, and therefore is able to skillfully engage with unhappy customers, listen, and, best of all, get them a quick resolution. In other words, your company can say it's serious about social media, but actually using it to help people is better than the best messaging in the world.

Did you see from the example above that this problem was reported in the hour before the Super Bowl and was resolved before kickoff?

Customers are talking: turning points in telephone sales calls

2009-02-02T10:54:00.001-05:00

I'm working on a project to listen to telephone sales calls and help the client find patterns explaining why some calls end up in a sale and others don't. Each call is a story, complete with emotion, conflict, and turning points. Listening to dozens of these, pictures begin to emerge of how people buy, and how, even when they like the product and may want to buy, don't. And it has nothing to do with logic.

One turning point I've experienced is the moment when a call turns from being headed to a close, to not. On the calls, it's very subtle: a pause, a change of subject, perhaps an additional question from the prospect. But afterward, a call that seemed to be heading toward a sale instead is, at best, a promise to call back.

The best way to explain it is to relate a personal story.

I've been a customer of Verizon Wireless for more than five years. I got a telemarketing call from them today, offering inducements to renew my service contract early. I've been evaluating this for a while now (this is a subtext of my posts on the Blackberry Storm), and after discussing it at some length with my wife, we're headed toward renewal.

This call, then, could have been Verizon's way of closing the deal. I was pretty ready, although I was thinking of doing this in March. If the deal was good enough, perhaps I would pull the trigger today. The call went something like this:

"Mr. Caddell," the rep said, "we are offering some extras today if you want to renew your contract early. You might be able to get a discount on a new phone."

"When does my contract expire?"

"The end of July."

"I thought it was the end of March."

(turning point 1) "That's the time when you are eligible for an early equipment upgrade. Your contract expires in July."

"OK, what are you offering?"

(turning point 2) "100 extra minutes per month." (This wasn't attractive to me at all. We don't use the minutes we have now.)

"How much off the phone?"

(turning point 3) "Well, you'll be eligible for that at the end of March."

"Earlier you said I could get a discount off a phone." (I didn't tell her that Verizon had already sent me two mailings offering me phone discounts for renewing now.)

"I said you might be."

There was no way was I going to renew then. At each turning point, in fact, I became farther from renewing than I had been before the call. Instead of feeling happy, encouraged, eager to get a new phone, I felt frustrated, annoyed, and that I had wasted time even picking up the phone.

It wasn't the rep's fault. She was given a difficult product to sell (competing, in fact, with the company's own mailings). When I began to ask pointed questions, the pitch fell apart. There was probably no rep on earth who could have closed me with that offer.

Which is a significant learning from this project for me. Selecting and training reps is only a part of the formula for success in telesales. The product must be useful, and the offer must be made attractive. And that work happens far outside the call center.

One of the world's most dangerous jobs: change agent

2009-01-30T11:15:00.001-05:00

This article (registration required, sorry) from Booz & Co's "Strategy and Business" will send a chill up your spine. The article, "Stand by Your Change Agent," by Stratford Sherman and Marisa Faccio, describes the results of a survey of 84 change initiatives between 1995 and 2005.

The initiatives themselves were successful, in the main: 85% met or exceeded the goals set out for them.

The leaders, though, didn't fare as well. Sherman and Faccio write: "Some 70% of the executives who led these major transformations went unrewarded, or were sidelined, fired, or spurred to leave."

The authors go on to describe types of companies at different levels of performance and how the change agent role is very risky in all but the very strongest companies. My take: large-scale changes disrupt the organization, stir up resistance, much of which gets focused on the change leader. If the change fails, the consequences are self-evident. If it succeeds, however, the pain endured in achieving it takes a toll on the person running the initiative.

If you're considering taking this role on, do it for the experience, the resume fodder, and the feeling of accomplishment if you're successful. Don't do it, however, for the recognition of your peers and leaders. Chances are, that won't be coming your way.

Business Book Hall of Fame: "War & Peace"

2009-01-28T10:50:00.001-05:00

Heard of it?

Read it? Probably not. It's the dictionary example of a long book. And it is long. Based on some indirect prodding from Dave Snowden and Jochum Stienstra, I finally picked it up, determined to read the whole thing, in November 2008. It is now the end of January 2009, and that'll tell you what a commitment is required to finish it. (The pile of unread books by my desk is now immense.) I can also heartily recommend the new English translation by Pevear and Volokhonsky; the writing was easy to understand and felt modern and fresh.

Was it worth nearly three months of effort? Hell, yes. "War & Peace" is an amazing work for our time (or any time). There are great love stories and domestic dramas in the book as well, but for the purposes of this post I'm going to focus on how the book tackles leadership, strategy, complexity and chance.

Perhaps most amazing is how Tolstoy shoots down the historian's view of the power of individuals to shape history. Here he is explaining Napoleon's rise to power:

Chance, millions of chances, give him power, and all people, as if by arrangement, contribute to the strengthening of that power. Chance makes the characters of the then rulers of France submissive to him; chance makes the character of Paul I, who recognizes his power; chance makes a conspiracy against him which not only does not harm him, but strengthens his power. Chance sends d'Enghien into his hands and accidentally forces him to kill him, thereby convincing the mob more forcefully than by any other means that he has the right, because he has the power. Chance makes it so that he strains all his forces towards an expedition to England, which obviously would have destroyed him, and never carries out his intention, but instead unexpectedly runs into Mack and his Austrians, who surrender without a battle. Chance and genius give him the victory at Austerlitz, and by chance all people, not only the French, but all of Europe as well, with the exception of England, which does not participate in the events about to take place, all people, despite their former horror and loathing for his crimes, now recognize his power, the title he has given himself, and his ideal of greatness and glory, which to all of them seems something beautiful and reasonable. (pp 1134-1135)

Of course, when the chances turn against him, starting with the invasion of Russia, he quickly becomes a fool and a failure. Was he a genius, or an idiot? Neither, of course. He was participant in a sequence of events over which he had little control, according to Tolstoy. This is a humbling lesson for leaders of all types, who operate in the complex domain--whether that be warfare, business or politics. Events will define you far more than you define yourself. Your actions, to a large extent, will be overwhelmed by forces outside of your control.

Does this then mean that generalship doesn't matter? Tolstoy would say yes. Throughout the book he writes that the most carefully-created war plans go off the rails immediately after the battle begins, while a single junior officer, deciding on his own to attack the French flank, can have an immense impact on winning or losing. And that the passions of the soldiers have much more effect on the outcome than the best leadership and training.

In my times working at very large companies, this seemed true to me. The accomplishments of the company were the agglomeration of thousands of small efforts on behalf of the rank and file. [You could argue that company failures--Enron, AIG, for example--also work this way.] First-line managers had a big impact. Directors, somewhat. But the plans and strategies of the C-level executives, sitting in the God Pod, at the end of the day, didn't mean much at all.

Customers are talking: the Blackberry Storm/Twitter project

2009-01-26T10:13:00.001-05:00

Like a lot of people, I've been trying to get a handle on what Twitter means for businesses. My professional interest is in finding unsolicited customer stories and making sense of them--wherever they are. In this, Twitter has a lot of promise. It's easy to use, brief and spontaneous. So are customers using this forum to talk about products? I decided to find out.

My test case was the Blackberry Storm. It received an absolutely terrible review from David Pogue, the New York Times' consumer-electronics columnist. It also had very good early sales numbers--500,000 units the first month of its release, according to the Wall Street Journal. The combination of these made it an irresistible subject to study: would the Twittersphere be flooded with posts from enraged buyers?

The project was made more interesting today, when the Wall Street Journal published an article entitled, "Bumpy Start for Blackberry Storm," which referred to complaints of early Storm users (but not Pogue's review), including this vibrant quote: "I found myself wanting to throw it in the ocean due to my frustration with its overall usability." The article also referred to a release of firmware soon after launch intended to address some of the early complaints, particularly response time.

I used Twitter Search to look for messages containing "Blackberry Storm" and a happy or sad emoticon (there's a button on the advanced search page that enables you to restrict searches this way). I looked at 88 English-language tweets going back to December 27. Here's what I found:

The biggest surprise to me was: where were the complaints from users? While half the Tweets were from Storm users, as opposed to people commenting on the Storm, or thinking about it, only 4 out of 44 (9%) of the users' tweets were negative, while 23 (52%) were positive.

(If you want to check out the searches I created for this project, they are here: happy search, sad search. Twitter Search has been acting funny the past few days--I'm only able to get one page of recent results, and can't search farther back. I used an RSS feed of the search over a period of weeks to gather the entire list of 88,)

From a customers are talking perspective, this isn't a terrible outcome at all for the Storm. Whether the firmware change made that much difference, or the Blackberry brand loyalists are immune to hardware glitches, or simply that devices like this aren't perfect and users expect that--they are not saying this is a terrible device. Many are saying that they like it. If I'm Blackberry and Verizon, I'm not discouraged by the Storm's initial reception.

By the way, the WSJ has already started to backtrack. On the web site, the article is now entitled, "Blackberry Storm Is Off To A Bit of a Bumpy Start."

(Disclosure, I am a Verizon customer and a Blackberry 8830 user. If you think I am a shill for Verizon, please don't make up your mind until you read this post, or this one.)

"Underground" as an example of narrative sensemaking

2009-01-26T05:24:00.001-05:00

Over the last couple of years, I've gotten more involved with collecting and sorting through multiple narratives to help businesses understand and deal with difficult problems. (Difficult, meaning the normal tools such as numerical analysis, process mapping, etc., are insufficient to understanding the issue.) This has become a cornerstone of my professional life, and it's been a rewarding and at times thrilling undertaking.

Shawn Callahan at Anecdote introduced me to this area, and then I learned about the work of Dave Snowden at Cognitive Edge. I met Cynthia Kurtz, who was an early collaborator with Dave Snowden, and have learned a lot from her as well. To the extent that the work I do is valuable to my clients, these folks deserve much credit.

Yet one of the best teachers I have had here (and I'm still a rank beginner) is the book "Underground" by Haruki Murakami. He's one of my favorite novelists, and this is one of his few nonfiction books. I read it years ago, long before I'd learned the terms "story listening," "mass narrative capture," or "sensemaking." But when I began learning from Shawn, Dave, Cynthia and others, it immediately came to mind.

In "Underground" Murakami seeks to understand and to help readers understand one of the most terrifying episodes in recent history--the sarin gas attack on the Tokyo subway system perpetrated by members of the Aum Shinrikyo movement in 1995.

Except for a brief author's preface, the book consists of the stories of survivors of the attack. Murakami interviewed everyone he could find from the list of victims, and presented their stories, unadorned, one after the other. He then interviewed a number of members of Aum Shinrikyo, and presented their stories, as well (a decision that is aligned with goals of narrative learning to take in multiple perspectives of a situation).

The result is a chilling, relentless book, that nonetheless does what no news report, CNN story or even historical chronicle could do--shows the impact of the attack and its aftermath on the real people who were caught up in it; and illuminates the puzzling (to outsiders) behavior of the Aum Shinrikyo members. It's a fully-realized, three-dimensional picture of a disaster, and goes a long way to explaining the unexplainable. In this way it's like an extended version of John Hersey's great "Hiroshima," though shorn of the authorial voice.

When you read this book, the stories layer and layer; you see the event from a deeper and deeper perspective, till you almost feel like you're there, inside the attack, experiencing it with the victims. And then you read the Aum Shinrikyo stories, and somehow you see that their world has its own internal logic. You finish the book, and you're exhausted, but you know deeply about this terrible event, how it happened and what it did to people. Your brain is working hard throughout--you're sensemaking.

If you're interested in narrative sensemaking, or you just want to learn the full story of a human disaster, you must read "Underground."

(Here's a much earlier reference to "Underground" and the subject of story-listening.)

Customers are talking: the empathetic company

2009-01-24T17:55:00.001-05:00

The New York Times today features an interview with Dev Patnaik, a consultant specializing in helping companies to develop growth strategies and the author of a new book, "Wired to Care: How Companies Prosper When They Create Widespread Empathy," which claims that a missing ingredient in recipes for corporate success is the human train of empathy:

[Patnaik] argues in the book that it is not the lack of innovation that hampers companies, but the “empathy gap” — the chasm between employees in organizations and the people that they serve. Companies, he said, “do a good job of stamping empathy out of employees, then are surprised when employees make poor decisions or try to sell things that people don’t need.”

In a way this reflects the "bringing the outside in" concept from Kotter's "A Sense of Urgency." Patnaik gives the example of the auto managers who never experienced the car business from a customer's point of view--buying a car, financing it, servicing it, etc.--and thereby lost touch with the consumer and the marketplace.

Part of this "empathy gap" is the distancing of management from the customer and the customer experience--where dashboards and status reports have crowded out anecdotal information and real human experience. This is what the "customers are talking" initiative is attempting to do--to connect managers and leaders with the ground-level experience of their customers and by so doing to equip them to make better decisions about their products and services.

Here's an interesting observation from Patnaik about one of the big problems with marketing:

The companies are trying to get the customers to identify with their product rather than getting their own employees to identify with their customers.

In other words, companies are trying to make up for their lack of customer insight with messaging. These marketers believe that if they create a powerful, resonant message, it will draw people to their products. But if the product is not created with a deep sense of the customer in mind, the message won't work.

I'll have to pick up a copy of "Wired to Care" and see what else the book has to say about this important subject.

Related posts:
A Competitive Advantage: Employees who spend most of their time talking to customers
Time to start listening to front-line employees

3rd Annual Top 5 HBR Breakthrough ideas

2009-01-23T10:13:00.002-05:00

... in which we winnow down Harvard Business Review's yearly list of 20 breakthrough ideas to a manageable 5.

1. The Business of Biomimicry, by Janine M. Benyus and Gunter A.M. Pauli. Many of the most important new innovations we'll see in 2009 and beyond will involve borrowing and inspiration from nature's processes.

2. Institutional Memory Goes Digital, by Gurdeep Singh Pall and Rita Gunther McGrath. What will happen when every word, gesture, etc., of business interactions are recorded and stored? [I'm most interested in the subset of this involving intentionally captured and signified narrative information for knowledge sharing. The Mistake Bank is an early stab at this idea.]

3. How Social Networks Work Best, by Alex Pentland. New research shows that collaborations work best when social networks are used differently for discovery and integration activities.

4. The Ikea Factor, by Michael I. Norton. Having a hand in building a product leads to a stronger emotional connection with it. [Does this say anything about self-service gas stations and supermarkets?]

5. Forget Citibank, Borrow From Bob, by John Sviokla, and Consumer Safety For Consumer Credit, by Elizabeth Warren and Amelia Tyagi. It's inevitable that the fallout of our financial crisis will be a radical restructuring and reinvention of the financial industry. And it's about time.

Related posts:
2008 Top 5 Breakthrough Ideas
2007 Top 5 Breakthrough Ideas

Customers are talking: The Eureka Button

2009-01-21T14:14:00.001-05:00

I was talking to Cynthia Kurtz once and she mentioned, "If I were developing a piece of software I would always want to put a Eureka Button on every page."

A Eureka button is this: if while using the system a user just figured something out that others might benefit from, he/she would click the button and be presented with a page where she could enter:

What Happened?

Where does this apply?

When should people read this story?

This input and information about where they were in the system (page & data) would be uploaded to a database. The database can be searched for patterns or browsed periodically, looking for bugs or unexpected uses of the system.

It's easiest for me to think about the Eureka Button in the context of enterprise software. Having worked a lot with CRM systems for telephony, I know that these systems have hundreds of user pages, with a virtually infinite number of paths through the system.

In these environments, product managers may know in theory how people should use the system. But their knowledge is quickly overtaken by experienced users, who learn how to apply the system to their jobs, often finding tricks or shortcuts to make the system work better for them. ("Eureka! I just figured out that if I dummy out some data items, I can capture information & save information from a prospect before they decide to make a product purchase. If they call back, I can look them up by their phone # and I don't have to start all over again.")

In this situation, a Eureka Button has great value for the product manager and the users. Product managers can learn about difficulties users have and how they overcome them. The tricks can be incorporated into the product, or deficiencies addressed. Users can learn from each other--perhaps Eureka Button entries can be blogged automatically and read by other users, dispersing tips and tricks and encouraging others to share their stories.

I can't even begin to catalog how a Eureka Button could benefit consumer sites, where (especially recent) products follow an emergent, iterative development approach and patterns of usage can affect the entire purpose of the product (e.g., Twitter). There are people much better suited than I to discuss some of these implications. If you're one of them, please let us know in the comments how the Eureka button could be used with these products.

(In searching for prior references to a "Eureka Button," I discovered this NY Times article from 2004. The article mentions that "'It's amazing how many people there are who find pleasure in sharing the little discoveries they make.'" The article focuses on undocumented features in PC software and in consumer electronics. The article references a site that publishes user stories of hidden Windows features.)

Customers are talking: using reverse logistics to improve products

2009-01-20T09:56:00.001-05:00

As part of our regular Tuesday series on finding and acting on customer use stories, let's talk about reverse logistics. This is the process by which retailers and manufacturers deal with customer returns.

This article (hat tip Colin Shaw) discusses how companies can examine and make changes to their reverse logistics procedures to reduce costs and streamline the process. This is good advice as far as it goes.

But like many "customers are talking" topics, companies need to take an additional step in order to really utilize the reverse logistics process to its utmost.

Each customer return is a story. Capturing and collecting those stories, and regularly examining them for patterns, can yield important information about how the product is designed, communicated and supported. For example, consumer electronics are notorious for their returns frequency, and the reason for these returns often is that the product is difficult to use or its documentation is poorly written or inadequate (multi-language manuals introduce another set of obstacles for customers).

A company can work with its retailers, as part of the overall design of the reverse logistics process, to capture important information about why the product was returned. Ideally, the verbatim customer story is captured--which is easy to do with online returns.

The collection, of course, is the simple part of the equation. The more complex task is the sensemaking of the numerous narratives captured. This sensemaking, more of a collaborative thinking process than an analytical one, can be accomplished with training and skilled mentoring.

The potential payoff is large: marketing managers who are made of aware of why returns happen can make (often simple) changes to packaging, design, channel strategy or documentation to improve initial customer satisfaction. Not only does this reduce returns, it also increases the likelihood that more people buy the product in the first place.

A friend owns a company that manages reverse logistics for name-brand consumer electronics manufacturers. I asked him if he knew why a certain product was often returned and he said, "Yes, always." I asked him if he had a way of letting the marketing folks at his client know these reasons. And he shook his head.

Given that many companies are outsourcing their reverse logistics operations to third parties, they need to take care that they keep the channel of communication open to learn why items are returned, and what can be changed about the product, its support documentation or its point of sale in order to make more initial purchases successful ones.

Sometimes crowds aren't wise

2009-01-17T16:57:00.001-05:00

I like Surowiecki's book, a lot, and I have experienced many instances where the collective judgment of a group was far better than even an informed individual. But the "wisdom of crowds" catchphrase is dangerous--oftentimes crowds are not wise at all.

We are experiencing right now an era in which crowds are really dumb. I'm referring to the financial markets and the related economic recession. The financial markets and news affecting the financial markets have merged into a massive echo chamber, wherein bad news begets pessimism which keeps prices down which begets another cycle of bad news.

We've seen this in reverse, of course. Do you remember 1998-1999, during which time everyone was watching CNBC or checking Yahoo Finance all day long, in real time assessing the value of their stock portfolios? Oversubscribed IPOs begat good news, which kept prices high, which begat more buying, etc., until it all came crashing down.

I thought it was clear to everyone that market groupthink, which afflicts us in good times and bad, obscured the true value of securities, and therefore paying close attention to news items in order to make sense of the markets and our economy was, at best, a waste of time.

But no. Felix Salmon, in his Portfolio Market Movers blog, points to a Financial Times article introducing us to a service from Reuters that collects news items and alerts traders when news trends indicate potential market movements.

In other words, lean into the echo chamber, and listen real hard for signals you can use to make decisions. Um, it's only January, but I will bet there's not a stupider product idea introduced for the rest of 2009.

Grounded qualification corollary #1 - don't companies know why they win or lose?

2009-01-15T16:49:00.001-05:00

Yesterday's post spurred some interesting comments, including Dave Stein's observation that "80% of B2B deals are lost for one of two reasons: inadequate (or no) qualification or inadequate (or no) planning."

I wanted to elaborate on one point, which is that grounded qualification is built on a deep understanding of why a company won and lost each opportunity, both in the past and going forward.

Which begs a question: "Don't companies already know why they win or lose?"

This question has two answers: sometimes they don't know at all, and sometimes they think they know the reasons but are wrong. Let's take each of these in turn.

We don't know why we won or lost. This situation is influenced by many factors in today's working world. First, there is little time for reflection built into sales professionals' (or sales managers') days. Everyone carries long to-do lists, attends too many meetings and is measured to death. (See this post for the implications of this culture on innovation and creative thinking.) There is also a culture of looking ahead: "let's not rehash the past," especially if it the outcome was negative.

We think we know why, but we are wrong. This point gets to a cognitive bias called the "actor-observer bias." According to the Wikipedia definition, this means people "tend to attribute their own behavior to their circumstances (i.e., situation causes), but tend to attribute the behaviors of those [they] observe to their dispositions (i.e., person causes)." In sales campaigns we will attribute a successful outcome to our superior strategies or tactics (rarely luck), and blame failures on ignorant or biased prospects or factors out of our control (product was deficient, price was too high, etc.). We are so satisfied with these rote explanations that we don't probe deeply into the reasons, nor do we ask the prospects to explain their actions.

If we recognize that (1) we need to reflect on and learn from each deal we pursue, and (2) question our assumptions and dig for the deeper reasons we won or lost, we are on the way to understanding our position in the marketplace--a tool we can use to be more selective in our pursuits, address our weaknesses, and generate more business at lower sales costs.

Grounded qualification: an emergent approach to assessing sales positioning

2009-01-14T08:53:00.003-05:00

For the past eight years, I've worked with helping midsized IT companies sell their products into a maturing telecom market. This is so different from the earlier times of unbounded growth that it doesn't even feel like the same industry anymore.

In the old days (i.e., before 2000), there were so many new telecom companies sprouting up that a company did not have to be a leader to be successful. They just had to be good enough.

Today, telecom vendors circle prospects like hungry dogs around a restaurant dumpster. The biggest and strongest elbow their way to the front, and the midsize guys try to keep from starving.

Some midsize guys do survive, though. They have enough of the right kind of customers, and gain enough new customers to keep making profits. How? The only way is to be very careful in planning and deploying their limited sales resources. Which gets down to a question of qualification.

In a B2B world, companies narrow down their range of prospects by deciding which sales opportunities they wish to pursue and which they don't. This process is called qualification. Strong sales organizations that I've seen are really good at qualification, and poor ones are really bad at it. Successful midsized companies have to be good at it, because they don't have enough resources to compete on all fronts and win. Stretching out their resources by definition is a failing strategy.

Good qualification means that you deploy your sales resources on opportunities that are large enough, profitable enough and winnable enough. In a virtuous circle, deploying lots of resources on good opportunities means that you have more likelihood of winning those opportunities compared to a company that spreads its resources over both good and "bad" opportunities.

One sales qualification methodology I'm familiar with segments the process into the following categories: "is there an opportunity?" "is it worth pursuing?" "can we compete?" and "can we win?" The first two categories are based on objective data--i.e., the company size, defined project budget, identified executive sponsor, etc. The final two are almost entirely subjective--are we positioned well? are our allies powerful? etc.

The challenge for midsized companies is that the subjective answers to the final two categories can make the difference between an opportunity worth pursuing and one to no-bid. Most salespeople, in my experience, hate turning down opportunities and so have an unconscious bias toward over-rating the subjective categories, resulting in lots of weak pursuits rather than a few, well-chosen, strong pursuits.

As a different approach, is it possible to create some criteria that are more observable and objective that nonetheless help answer the "can we compete?" and "can we win?" questions?

I propose the answer is yes, and we can call these items "grounded" qualification criteria. (Grounded theory, from the Wikipedia definition, is "a systematic qualitative research methodology in the social sciences emphasizing generation of theory from data in the process of conducting research.")

What I'm trying to say is this: when a company wins an opportunity, there are reasons why--they may be emotional, logical, cultural. Similarly in a loss. The company can use grounded theory methods to gather winning and losing examples, to sort them out and generate from them several insights as to signals of potential wins and losses. Those signals can then be used as part of the qualification of new opportunities.

By way of example, a former employer of mine had a product that was functionally adequate but which was built on a technology architecture that had fallen out of fashion. It had few references. Not surprisingly, most of our sales pursuits were failures. Yet the company made several strategic sales of this product. (As a middle manager, I was surprised by these wins.) If we'd deeply examined those wins and compared them to our losses, grounded theory would have helped us understand that the company's executives were very well connected to certain telecom ventures, and those connections were vital to our winning that business. Knowing this, we could have planned and evaluated opportunities based on our executives' connections, and possibly found more strategic wins (at minimum, we could have spent less time on sure losers).

Doing a grounded theory assessment means deeply understanding why companies that bought your product did so, and why those that didn't made that decision. (See an earlier post on the value of detailed prospect loss reviews.)

It's important to point out that competitive and market positioning is a complex system (per the Cynefin Framework), and therefore a company's position and qualification rules will shift over time. The grounded evaluation is therefore something that needs to be updated continuously.

One of the benefits of grounded theory is that it can generate new and unexpected areas of opportunity and unveil hidden dangers. Midsized companies need to "rifle shoot" opportunities and put sufficient resources into the very best opportunities in order to be successful. Grounded qualification is a potentially important tool in these companies' arsenals.

(Acknowledgement to Cynthia Kurtz for first exposing me to grounded theory.)

Customers Are Talking: Reading Between The Lines

2009-01-13T05:46:00.000-05:00

One of the important insights in looking for meaningful stories in customer interactions is the following: you can't read a story by looking at metrics. That is to say, how long someone talked, what time of day it occurred, etc., has no relationship to the content itself. In my work, I listen to lots and lots of customer stories, and I have experienced this very thing. If you want to understand the story, you have to read, or listen to, the whole thing.

It's unfortunate that this is so, because the quickest way to absorb information is to read it in summary. It's also the easiest way for computers to process information. Computers are excellent at counting, measuring, etc., but terrible at reading and interpreting.

I hear you already: what about semantic analysis? Good: doable by computers. Bad: doesn't provide much insight. Here's an example: evaluate all customer service calls longer than 8 minutes and containing the word "unhappy." Let the computer pull out two sentences before and after that word. Won't that sort out all the unhappy customer calls and allow us to analyze a manageable data set? [If you think this is difficult to do, I can point you to a slew of vendors who are dying to talk to you about their products.]

The problem is, "unhappy" is context-dependent. The caller may be unhappy with the quality of her service. She may also be unhappy she forgot to pack her son's lunch that morning, Someone else may be unhappy for a completely unrelated event.

[As an experiment, I've been monitoring Tweets referring to the Blackberry Storm using the happy :) or unhappy :( emoticons--easy to do with Twitter Search. With more than 100 tweets examined, very few of the emoticons represented satisfaction or dissatisfaction with the device itself--they were related to wanting the device and not getting it, or hoping to get it, for example.]

In a recent discussion, a friend talked about word clouds as very useful summaries of social media data. I pointed out to him that the appearance of a word in a story doesn't create significance. Similarly, the absence of a word doesn't mean that word is insignificant. (What's unsaid may, in fact, be the most important words in the entire dialogue. Harold Pinter won a Nobel Prize for his mastery of this truism.)

In sum, at present, the intervention of a person close to the customer interaction at the time it occurs is the best way to determine if a communication is significant or not. If it's someone looking at it after the fact, that person will have to read the entire story, not a summary. I wish there were a shortcut, but there's not.

Are keyword searches or word clouds useless? No. If you are a cable company, searching for specific, unambiguous words like "DVR" in your customer communication is likely to be useful. Searching for context-dependent items like "unhappy" or "delighted" is not.

Learn from your predecessors--the only way, if you're a CEO or President

2009-01-12T09:49:00.000-05:00

Imagine that you have a job that's so exclusive that not only could you not find a book teaching you how to do it, you'd be hard-pressed to find anyone in your town, or state, who could give you much help.

The job of corporate CEO is like that. So is President of the United States. In each of these positions, learning on the fly seems costly. Is there an alternative?

Yes there is. If only it were used more often.

This question was taken up in two recent articles. In the January Harvard Business Review, Thomas Friel and Robert Duboff discuss "The Last Act of a Great CEO." The last act being an outgoing CEO's sharing knowledge, experience, and perspectives on the job with her successor.

And an opinion piece by Sheryl Gay Stolberg in yesterday's New York Times remarked on the rarity of gatherings like Pres-elect Obama's recent lunch with four other living presidents ("The Very Elite Club that Never Meets").

Friel and Duboff write this about new CEOs learning from their predecessors:

It is difficult to imagine a richer source of information and advice for a new CEO, even on a purely personal level. Being successful as the chief executive of a major enterprise is hardly a straightforward matter; the right combination of style, skill, and focus can vary dramatically depending on the context. One CEO we interviewed put it simply: “You can’t really understand this position until you’re in it.” At the very least, the departing executive has a unique and relevant point of view on the dynamics of the board of directors and the executive team. Often he or she has the most strategic and current understanding of the issues the company faces.

Stolberg's article hits the same theme:

“One thing historians have talked about for years is that there should be a better way for sitting presidents to use the experience of former presidents, and it doesn’t happen enough,” said the presidential historian Michael Beschloss. “The reasons are varied: sometimes personal antagonisms, shyness, the feeling that the former president is too removed from today’s politics to know very much. The result is that there is a reservoir of wisdom and experience that is not relied upon.”

I have an idea that might help. Or, rather, my wife Maura had the idea and she let me borrow it. Companies, and the executive branch, need to create narrative repositories like The Mistake Bank. A repository would be a place for presidents or CEOs to recount events. (Especially mistakes, since we learn very well from mistakes.) and what they learned from them. The repository would be available only to successors. New CEOs and presidents, or experienced ones, could dip into the repository when they had a question or issue they wanted some perspective on.

I've done this, and I know how to set them up, and how to make use of them. CEOs, Pres.-elect Obama, it's time to put this into action. You know where to reach me.

Studying what customers do, and acting on it: marketing as an "art form"

2009-01-10T16:55:00.001-05:00

There's a great op-ed piece by Judith Flanders in today's New York Times, covering the recent bankruptcy filing of Waterford Wedgwood and recounting how the company has lost its way, especially in comparison to the marketing genius of its 18th centry founder, Josiah Wedgwood.

According to the article, two innovations catapulted the pottery company from humble origins to leadership. One was a technological breakthrough, "creamware," a process that created high-quality earthenware nearly indistinguishable from porcelain.

The other was marketing acumen that would impress Steve Jobs. I love this quote, discussing Josiah's focus on learning from buyers and leveraging that knowledge to improve his product and its marketing:

In a letter to his business partner, he marveled at “how rapidly the use of [creamware] has spread” and “how universally it is liked,” and tried to balance how much this had to do with its royal “introduction” versus “its utility and beauty.”

That is the true Wedgwood. It wasn’t pleasure at past achievement, but instead determination to understand why success had come about, so he could build on it. Selling was an intellectual pleasure, an art form.

What a refreshing viewpoint, during these days when selling and marketing are portrayed (often by people in those professions) as a grind, perhaps even dishonorable.

Female guru alert

2009-01-08T07:57:00.000-05:00

The members of our list of overlooked female business gurus continue to spread their important ideas:

- Herminia Ibarra of INSEAD has published an article in the January Harvard Business Review ("Women and the Vision Thing") asserting that peers, subordinates & bosses see female leaders as equal to or superior to their male counterparts in every area except one--creating and articulating a strong vision.

- I just got in my hot little hands an advance copy of the new book by Rita Gunther McGrath (& collaborator Ian MacMillan), "Discovery-Driven Growth," which I'm very much looking forward to reading. (I've got to finish "War & Peace" soon!)

As a reminder, the rest of the list includes Amy Edmondson of Harvard Business School, Deborah Ancona of MIT, Traci Fenton of WorldBlu and Rosabeth Moss Kanter, also of HBS. Be sure to check out their work.

You can learn a lot about market psychology at the craps table

2009-01-07T11:59:00.001-05:00

You think I'm kidding, right? Let me tell you a story.

My friend Tom and I took the occasional trip to Las Vegas in our single days, and after I got tired of trying to count cards in blackjack, he convinced me to try craps.

In craps, you can bet with the shooter ("pass" and "come" bets) or against ("don't pass" and "don't come"). The same bets are possible, and the payoffs are proportional to the odds of each occurrence. In other words, it's the same game either way.

Given all that, you'd imagine that as many people would bet the don't pass and don't come as the pass and come lines. But they don't. My unscientific observation is that 90% of craps players play with the shooter, not against.

I noticed something else. When I played "don't pass" and "don't come," people gave me dirty looks. They completely forgot that the dice have no emotion; they come up seven or eleven or eight or whatever and the game pays out or takes your money accordingly. After a while, it just seemed easier to play with the shooter. I could then be part of the crowd.

I sense a similar psychology at work in the markets. Shorting stocks is more complicated than playing the "don't pass" line, but there's no significant impediment to doing so. But not only is shorting much less common than going long, there's also a stigma against doing so.

Companies whose stocks are shorted scream that the short-sellers are generating and amplifying negative news to influence the direction of prices. You'll never see even the world's most successful short-seller compared to Warren Buffett or Peter Lynch. Analysts (perhaps till recently) rarely trotted out "sell" recommendations.

This wouldn't be a problem except the goal of an efficient market is to price a security properly. This requires downward pressure when things aren't as they should be. If there aren't enough short sellers, there won't be a counterbalance to ebullient buying. Momentum kicks in, and a bubble ensues.

I don't know how much this had to do with our current problems, but I bet it was a contributor.

(For those wanting to read interesting perspectives on the financial crisis, I'd recommend Felix Salmon's blog on Portfolio, James Surowiecki's blog, and the Economist's Free Exchange blog.)

Photo by runneralan2004 via Flickr Creative Commons

Is 2009 "the end of analytic science"?

2009-01-06T16:40:00.004-05:00

Getting my head around the ideas of Mihaly Csikszentmihalyi is more difficult even than spelling his name correctly, but I think that this statement has real ramifications for the work I and others are doing in applying mass customer narrative to marketing and business issues (from edge.org via TEDBlog):

Mihaly Csikszentmihalyi predicts:

The End of Analytic Science: The idea that will change the game of knowledge is the realization that it is more important to understand events, objects, and processes in their relationship with each other than in their singular structure. Western science has achieved wonders with its analytic focus, but it is now time to take synthesis seriously.

Customers are talking: you can't listen to customers if you hate them

2009-01-06T09:49:00.000-05:00

Every Tuesday, this space will cover "Customers Are Talking... Are You Listening?"

"Customers Are Talking" builds on the work I've been doing for the last fifteen years in product management, sales & account management, & specifically on the story-listening work I've embarked upon in the past year. (I cheated a little by sneaking in two posts on this subject yesterday.)

It was great to read a recent interview with one of the quietest great thinkers I know, Cynthia Kurtz.

While discussing some things she had learned in her work helping companies and governments gather and work with stories from customers and employees, she said this:

Several times now [in these projects] I have seen people viewing their clients or customer or employees or constituents with contempt, for example equating weakness, confusion or ignorance with insignificance, low status/value/worth or even wrongdoing.

As I read this I was surprised and shocked, yet at the same time I nodded my head and said to myself, "Oh, yeah, I've seen this lots of times." No company would admit that it hates its customers, but if the leadership looks deep into their hearts they may recognize the behavior that Cynthia mentions.

And for marketers this is a big concern. Because marketers, more and more these days, need to listen to and act on customer feedback. People don't listen to those they hate. They disregard, dismiss or rationalize their statements. Even when marketing believes in its customers, if the organization's culture is a customer-hating one, the messages won't get acted on. [It may go without saying that customer-hating companies will be punished first in a difficult economic environment.]

So, if you're instituting a voice of the customer program, or if you've already got one, answer these questions first: do I think my customers have something valuable to say? Will I listen to it and try to act on it?

Because if you're one of those companies that holds their customers in contempt, asking them what they think won't do you any good.

[By way of equal time, I should probably refer to this earlier post where I talked about companies who are hated by their customers.]

Stop reacting, and start listening, to customer online feedback

2009-01-05T17:03:00.001-05:00

I generally like this post from Matt Rhodes, my fellow Futurelabber ("How to react if somebody writes about your brand online"), but I have a bone to pick with the premise.

One of the biggest mistakes marketers are making in social media now is focusing on reacting. They are taking lessons learned from political campaigns and applying them to their relationships to the public. It's a misfit. Political campaigns are adversarial. If your relationship with the public is that way, you have bigger problems than what people say about you on Twitter.

Reacting as strategy is a last, desperate attempt to deploy the marketer's favorite tool, "messaging," into a connected marketplace. As Doc Searls wrote, "There is no market for your messages."

Rather than a futile tit-for-tat, your post to my counterpost competition to establish the preeminence of a company's message in the networked marketplace, how about listening to what customers are saying, and taking it to heart? Thinking about it, perhaps? And, if warranted, a respectful, measured contribution to the dialogue? It can be done. Ask Comcast, and Dell, for starters.

Why you should listen to customers even if they're wrong

2009-01-05T16:16:00.001-05:00

Even companies who believe "the customer is always right," if there are very many of them left, don't mean it literally. They mean something like, "We try to accomodate the customer, even when they are wrong." But beyond addressing the immediate symptom (the heart of "the customer is always right" philosophy), there are valid reasons why you shouldn't dismiss (or disregard) customer stories that you don't consider accurate:

1. There is truth in their perceptions, even if the facts don't add up. Customer outcry is emotional, not logical, in nature. If they complain, they are feeling pain, and even if they can't articulate the reasons to your satisfaction, the root issue is very likely significant to you.

2. Customers have more credibility than companies. Recently, in my town, there's been a conflict between the private water provider and the town government over a proposal to raise water pressure and whether that might be causing an increase in water main breaks. In an "open letter" to customers, the regional president of the utility tried to dismiss criticism of the program. Who was more credible to town residents: the elected town representatives, or a water company regional president?

3. Being factually correct is overrated. In marketing, perception is reality. Brand is an accumulation of perceptions. Jochum Stienstra discussed in a recent post how those perceptions create a profound, cognitive reality for customers. So, in focusing on the data and dismissing the perceptions, you may be missing the point.

4. They may, in fact, be right :)

Looking ahead to 2009

2008-12-31T13:57:00.002-05:00

Like lots of others, I enter 2009 with a bit of anxiety. I have less visibility into the market for my consulting services than I have had in nearly two years.

Yet I have never been as optimistic regarding the soundness & value of the work I'm doing.

Hopefully it's not self-delusion. I don't believe it is.

Yet as I've reflected over what I've done & learned in 2008, I'm more convinced than ever that the time is ripe for what I'm doing.

Which is: working with companies to gather, sort, make sense of their customers' freeform feedback. Using, as it were, these story fragments unlocks a rich store of information unbiased by survey hypotheses and distinguished by candor.

It's a great time, too, to be working in this area. Social tools, especially Twitter, are a new and easily-searched archive of customer emotion.

In the recent Futurelab live blog session, the question was rightly asked about why I'd be interested in peering into people's minds and emotions--isn't what they do more important than what they think?

I didn't answer that question very well that day, but having had time to think about it, I'd say this: I'm not trying to read minds. I'm trying to hear what people say. People talk or write when something happens that is significant to them. If they're using a company's product and say something that's significant to them, it's significant to that company too.

One reason companies don't listen to these stories that they are loud & cacophonous and loaded with noise. They can be rude & inconsiderate. They are in the customer's language & context, not the company's.

But using sensemaking techniques informed by cognitive science & the study of complex adaptive systems (Kurtz & Snowden), the resonances, themes & values in the mass of stories can be found.

And companies can use these resonances to see where their products are generating delight and where they're creating frustration. Where their customer service is working & where it's breaking down. And why some people who call to order a product don't end up doing so, in spite of the company's best efforts. .

The current downturn will shake out companies who hate their customers, who prey on them, who profit through punitive and well-hidden fees & surcharges.

The ones that are left will value every single customer, will treat them respectfully & will really want to understand what those customers want & how they feel.

The approaches I'm working with are a vital tool in this quest. And that's why I'm optimistic for 2009, regardless of what I read in the paper.

Happy New Year!

Still thinking about the music business

2008-12-30T06:45:00.001-05:00

2008 was the year that I finally realized what was happening to the music business. Whether it was talking to Fran Ten about how his emerging band West Indian Girl was trying to succeed in spite of the business climate, or asking why it was necessary that e-content be free (the most-read post of the year--thanks David Pogue), or reading the comments to that post, many of which said, in effect, "Why the hell should we pay for music?"

I like music a lot, and I'd like to see people who make great music be able to make a living at it. I'm trying to think of a model that may work. Two articles caught my eye this weekend on that point.

One is the WSJ article on New Year's Resolutions (never did I think I would mine that for TWO blog posts)--specifically Duncan Sheik's resolution ("To create a recording studio/rehearsal space close to New York City, where my coterie of musician friends and collaborators can work on their projects irrespective of financial considerations").

The other was Jon Pareles' lament in the New York Times on the influence of music licensing for commercials.

I'm working through some ideas that I'll write about next week. Please pass on any thoughts you have, especially if you don't feel you should pay for recorded music. Where does the musician's income come from in that case?

Martha Stewart on contracts

2008-12-29T10:19:00.000-05:00

Saturday's Wall Street Journal featured New Year's Resolutions from famous people. I liked this comment from Martha Stewart (she seems to have had some experience with contracts):

I rarely make New Year's resolutions because I believe in constant evolution and change. Resolutions and contracts are very similar -- they need constant tweaking and editing to work really effectively.

Gladwell's Outliers, and teachers & quarterbacks

2008-12-16T13:42:00.003-05:00

Malcolm Gladwell has been getting some unsurprising backlash in the wake of his latest book, "Outliers." But I find myself thinking about David Leonhardt's interesting opinion in the New York Times Book Review, where "Outliers" is looked upon not as a business self-help book, but as a political essay--in other words, according to Leonhardt, Gladwell is focusing on how environment and context matter in success and excellence, and is making a pitch to society to create more situations where "outliers" can grow.

Gladwell takes up this theme again in this recent New Yorker article. Comparing the process to find great teachers (who, he says, improve learning of their students by 50% over the average) to that of locating great NFL quarterbacks, he points out the fallacies inherent in a system of university certification when teacher excellence cannot be shown other than by demonstrated competence in the position. Gladwell argues against tenure and for, instead, seeding lots of teachers into the system, winnowing them to the very best, and paying them accordingly.

Which connected with Sunday's NYT magazine article ("The Two-Tier Teacher Contract") about a similar process being tried by the new chancellor of the Washington, DC, school system.

So, perhaps "Outliers" has done its job. It's got us talking and writing about something important.

David Foster Wallace on "traditional human verities"

2008-12-15T14:53:00.004-05:00

I love David Foster Wallace's writing, and am sad that he is gone. The New York Times Magazine yesterday contained an article about Wallace's philosophy that was at once a heartfelt tribute and a window into the soul of a fascinating person. This was my favorite passage from the article:

Wallace was especially concerned that certain theoretical paradigms — the cerebral aestheticism of modernism, the clever trickery of postmodernism — too casually dispense with what he once called “the very old traditional human verities that have to do with spirituality and emotion and community.”

It didn't surprise me to learn that Wallace, in an undergraduate paper, provided a mathematical proof to refute a chilling fatalistic argument that had gained notoriety at the time. His systematic deconstruction and illumination of the phenomenon that is talk radio ("Host" from his last book, "Consider the Lobster: And Other Essays") is uncompromising and utterly engaging.

I wonder what he would be writing about these days.

philosophy, human nature

Friday randomness: 5 reasons why Johnny Marr is a genius

2008-12-12T09:30:00.005-05:00

It's a week for lists and music, so the other night when I put on Neil Finn's "7 Worlds Collide" live album it inspired thoughts about why Johnny Marr is a genius.

On the Finn album Marr plays his own "Down on the Corner," and then Neil does his best Morrissey impersonation on The Smiths' "There Is A Light That Never Goes Out."

One of the fun things about bands breaking up is that you hear the creative folks individually, and you can tease out what each member contributed. Usually your impressions of the group overvalue the contributions of the lead singer. Once I heard Morrissey's first solo album (not a bad album, mind you), it became crystal-clear what Marr had contributed to the Smiths.

In general, Marr is the great counterexample to the "singer as major contributor" mindset. He never sings (until his turn on the Johnny Marr & the Healers album). But he is sideman extraordinaire. He is without a doubt the greatest rhythm guitar player ever, and a great composer. Listen to these five songs he contributed to and let me know if you agree:

1. The Smiths, "Girlfriend in a Coma"

2. Electronic, "Get the Message"

3. Bryan Ferry, "The Right Stuff"

4. Johnny Marr & the Healers, "Down on the Corner"

5. Modest Mouse, "Dashboard"

And for those who haven't had enough Johnny Marr by the end of this post, here is a transcript of a lecture he gave recently at the University of Salford. (It does deal with innovation, so this is not just a lazy Friday post!)

best of, music, randomness

Best Albums of the Year 2008

2008-12-11T10:18:00.003-05:00

OK, OK, off topic, I know. But there was some great music out there, and with me working out of a home office most of the time, the iPod shuffle is an important part of my work environment. With no further ado, then, here are the best albums I heard this past year.

1. Nomo, "Ghost Rock." Bleepy analog synthesizers, plinky homemade instruments, killer brass section. Funky as all get out. This album sounded like nothing else I heard last year. It has remained in my car CD stack since summertime.

NOMO Live session from Svetlana legetic on Vimeo.

2. The Helio Sequence, "Keep Your Eyes Ahead." I never figured out why I rarely heard any of these songs on the radio. They rock. Plus, there's a great countrified tune and a swampy-sounding song thrown in for good measure.

3. The Gaslight Anthem, "The '59 Sound." Driving power-pop, great lyrics, allusions to Tom Petty, Miles Davis and (of course) Springsteen, this Jersey band will be around for a long time.

Old White Lincoln

4. The Cat Empire, "So Many Nights." Quieter than their prior effort, less of a party album, more serious. But still a great listen from top to bottom. This Australian band effortlessly combines genres and keeps the foot tapping.

No Longer There

5. Fleet Foxes, "Fleet Foxes." A hint of Crosby, Stills & Nash; a taste of The Beach Boys. On one track they out-My-Morning-Jacket MMJ themselves.

White Winter Hymnal from Grandchildren on Vimeo.

Honorable mentions: REM's "Accelerate" (the best thing they've done since "New Adventures in Hi-Fi"), My Morning Jacket's "Evil Urges" (wanted to like it better than the last two great ones, but simply didn't), "Secret Machines" (ditto), "Vampire Weekend" (a few really catchy pop songs, and some filler. Will look forward to their next one), "Grand Archives" (ditto).

Tags:
best of, music, 2008

Best Business Books of the Year 2008

2008-12-10T09:42:00.004-05:00

If you don't know what Christmas gift to get for that hard-to-buy-for businessperson, here's your answer. It was a great year for business books. There were five or more additional books that I'd recommend to others. Communicating via story was a theme this year (or perhaps that's what I was looking for!), as you'll see.

1. "Working With Stories," Cynthia Kurtz (free e-book). I read this book three times, cover to cover. A clearly-written, highly practical book that illuminates a new tool for companies to attack intractable problems--gathering, looking at, thinking about, and acting on the stories that customers, stakeholders and employees hold in their minds. (Photo shows my rather beat-up copy!)

2. "A Sense of Urgency," John Kotter. A timely book, full of stories, about the imperative for companies to develop a mindset to "move, and win, now" in order to effect lasting change.

3. "The Opposable Mind: How Successful Leaders Win Through Integrative Thinking," Roger Martin. Describing great innovators' ability to simultaneously hold and reconcile two conflicting ideas. Notable, among other things, for highlighting success stories outside the US--in Canada, to be precise.

4. "The Knack: How Street-Smart Entrepreneurs Learn to Handle Whatever Comes Up," Norm Brodsky & Bo Burlingham. A great book discussing how successful entrepreneurs share many common attributes--the including the ability to listen to advice and yet, when necessary, to ignore it. Full (full!) of stories.

5. "Groundswell: Winning in a World Transformed by Social Technologies," Charlene Li and Josh Bernoff. A prescient guide for companies to understand and utilize social media to reach customers and gain insight into markets.

Related Posts:
Best books of first-half 2008
Best books of 2007

Tags:
reading list, best of, business, 2008

DARPA seeks algorithms to create stories from info fragments

2008-12-09T05:17:00.000-05:00

One of the nicest aspects of blogging is when a reader points you to an interesting article you hadn't seen. I'd like to thank reader S.E. August for this reference.

Wired's Danger Zone blog reported last week that DARPA is looking to sensemake various forms of data by combining them into stories.

The Cognitive Edge training I took last week discussed (among many other topics) gathering narrative fragments into composite stories as a way to make sense of a situation and convey that information to others. Similar thus far. A possibly reality-defying assumption follows, though. According the Danger Zone post:

The author of this tale, however, would be a series of intelligent algorithms that can pull all of this information together, tease out its underlying meanings, and put it in a narrative that's easy to follow.

In the Cog Edge method the sensemaking is done by a group of humans, not a computer. The assumption is that distributed cognition of a group of people can elicit meaning where a single person, or a computer, cannot. I'm not up on the latest in artificial intelligence, but I'm doubtful that an entirely computerized approach can yield anything of use.

Perhaps a partially-computerized method, where fragments were gathered (sampled?) by machine and sensemade by humans, would work better. Or if the fragments could be human-coded as they were captured the significant or related ones might be easier to isolate. I don't know. Can any readers weigh in who are more optimistic that a totally-computerized approach might work?

A link to the DARPA RFI is here.

(Photo by cote via Flickr creative commons)

sensemaking, narrative, stories, DARPA, communication

A Personal Story

2008-12-08T09:18:00.003-05:00

I woke up early Saturday morning. As I lay in bed trying to fall back to sleep, it occurred to me that the work for my biggest client was slowing down and I wasn't sure what I could do to ensure it continued. A prospect had emailed me earlier this week with some ideas to scale back the work I had proposed to do for him. And a couple of other prospects I was hoping to close hadn't returned some emails I'd sent over the past couple of weeks.

Despite enjoying one of the busiest months since I went out on my own, I allowed that morning's sleep to be ruined by thoughts and worries over the future. Such is the life of an independent contractor, and given the current economic climate, these worries are affecting many others as well.

Thankfully, an article in the Sunday New York Times pointed out that this fear is a natural process of our brain when confronted with uncertainty and threat. "When Fear Takes Over Our Brains," by Gregory Berns of Emory University, furthermore, reminds us that "when the fear system of the brain is active, exploratory activity and risktaking are turned off."

And this is the problem with recession or whatever you want to call it--people and businesses stop exploring and taking risks. Other people read in the newspaper (every single day) about the hunkering down of these groups, become afraid, and hunker down themselves.

Berns talks about what he is doing during this time to get himself and his brain thinking again, moving past the fear. Sharing his own fears and plans is a gift and helps me focus on what I should be doing. This week, I'll be working hard on all my current projects. I'll be calling prospects back who I haven't heard from. I'l be thinking of new things I can do with may big client and proposing them. And I'll be reflecting on other actions I can start and other opportunities I can pursue.

Because I won't get paralyzed thinking about the bad things that could happen. And if we all can put the fear aside, and start exploring and taking risks--even small ones--we will begin to shape the next era, beyond this recession.

career, narrative, recession, neurology, risk, New York Times

Example of a blog attracting user stories

2008-12-04T17:58:00.001-05:00

Sorry for this somewhat awkward syntax of this post. I am composing it on my Blackberry 8830. This is significant because the post concerns David Pogue's eviscerating review of the new touchscreen Blackberry Storm mobile phone.

In response to the review, Pogue received more than 100 stories of people who also hated their newly-bought Storm. There were also dozens of defenses of the Storm and RIM, its maker. And many more comments in response to the post.

Pogue's post served as an attractor, stimulating all sorts of vibrant customer feedback. As a product manager and someone interested in innovation, this example is fascinating and illustrative of how social computing is revolutionizing market & customer intelligence.

What does all the feedback mean? Probably lots of things: the Storm has serious issues; RIM has committed, passionate users; Apple is a hard act to follow, etc.

Whatever it means, let's hope that RIM is listening, sensemaking, and acting. If they want some guidance, tell them to shoot me an email.

By the way, composing this post on the 8830's thumb keyboard & tiny screen has been agonizing. I was hoping the Storm might be my next step. Now I'm not so sure.

market research, narrative, product management, sensemaking, wireless, social media

It's time for the "Numerati" to step back

2008-12-02T03:37:00.000-05:00

I've been reading the book "Einstein's Mistakes" by Hans Ohanian and though it's been a lot different from my expectations (I was looking for mistake stories and through 150 pages haven't found many) it has proved useful in spurring some thoughts.

One such thought has been the consequences of the growth of science and logical thinking. The first part of "Einstein's Mistakes" describes the roles of Galileo, Newton, Maxwell and others in setting the stage for Einstein's relativity theories. What this brief physics history reinforced to me was the gradual rise to preeminence of logic and mathematics in the processes of human thought--at the expense of philosophy, sociology, anthropology.

Interestingly, even in these legendary clear thinkers there was the all-too-human urge to self-protect and rationalize. Notable was Galileo's effort, according to Ohanian, to fudge the numbers so that his calculations would match what he knew to be correct about the heavens.

Next on my list to read (around "War and Peace") is Stephen Baker's "The Numerati." I find I come to this book with loads of prejudgments. From the press and the jacket copy, the book celebrates the numerization of our thinking. Which I believe is mostly bad news.

This kind of number-worship has brought us financial risk mitigation that paradoxically increased risk, created AAA-rated bonds which were actually of junk status, and any number of other examples of solid financial and numerical logic that under examination simply failed the common-sense test. In other words, a hedge fund that studied human nature might have made a lot of money these last few years.

To me, "The Numerati" is behind the times. We've seen the apotheosis of the logical/mathematical revolution, and it ain't pretty.

It's time to put numbers into their context, and begin to shift more investment to understanding people, how they think, feel and relate to one another. This is where the money will be in the future, and this is what society needs now.

As Dave Snowden writes, "It's not that social computing has created some completely new form of human interaction, what it has done is to enable conversations across barriers and boundaries. We can now be a global tribe (or rather tribes), if we can make the changes that the technology permits."

Tags:
reading list, logic, thinking, social media

For deep, narrow coverage, blogs are better than mainstream media

2008-12-01T09:39:00.006-05:00

A few Philistines are still maintaining that blogging isn't a worthy medium for intelligent discussion, that it's somehow less valuable than the "professional media."

Yes, there are crappy blogs out there, just like there are crappy newspapers and magazines. The low barrier to entry of blogging means there is more crap--but, long-tail style, there is also content of tremendous value, erudition, power and influence.

I learned of one more example today. Tanta, who wrote for the Calculated Risk blog, died over the weekend.

She warranted an obituary in the New York Times and a mention from James Surowiecki (from that most professional media outlet, the New Yorker). Here's another tribute from Felix Salmon at Conde Nast Portfolio.

And it wasn't because she wrote about Britney Spears or LOLcats. According to the Times,

Thanks in large part to Tanta’s contributions, Calculated Risk became a crucial source of prescient analysis as the housing market at first faltered, then collapsed and finally spawned a full-blown credit crisis.

Blogs allow writers with deep, narrow expertise, like Tanta, to pass on their learning, share their opinions, and illuminate that which for most of us is unknown. For me, in particular, I still read general-interest media, like the Times, New Yorker, WSJ, HBR, etc. But for subjects I want to explore more deeply, blog content is far better and more valuable.

There's no way Tanta would have had a voice twenty or even ten years ago. That's a benefit to readers everywhere. Including, as her case makes clear, those from the "professional media."

Tags:
blogging, blogs, finance, obituaries, media

Thankful for...

2008-11-25T09:00:00.002-05:00

...Maura, George, Charlie, and a healthful year for all :)

...my dad, who at 84 is starting to really slow down.

...the clients I've done work for this year.

...folks who have referred me to others.

...the people I've talked to about marketing, narrative, innovation... or just life in general.

...the great blogs I've read.

...Harvard Business Review.

...free books.

...the 300+ people who joined The Mistake Bank.

...serendipity (aka luck).

...Bitstrips.

...the people who've followed me on Twitter.

...the people I've followed (even the Carnival Barkers).

...TweetDeck.

Going to put the blog for a bed for a few days while we visit family for the Thanksgiving holiday. Safe travels, all.

Public health story database needs your contributions

2008-11-24T11:22:00.003-05:00

Cognitive Edge and a nonprofit called Innovation Health are launching a narrative database focused on public health issues, including child vaccinations and obesity. It needs your stories of encounters with the medical industry.

Health care is one of the preeminent issues of our time and will be front and center in our consciousness when the financial crisis is long past. The health-care infrastructure is a complex system with lots of actors, and so narrative analysis offers a better way of evaluating it than surveys or metrics.

Please consider sharing your experiences. The link is here and the password is HEALTH.

Note the following:

By participating in the survey, you acknowledge, accept and approve the use of the information provided by Innovation Health and the Cognitive Edge practitioner network. Innovation Health will use the information to observe patterns that the stories may reveal. The Cognitive Edge practitioner network may use the information collected as a demonstration data set to illustrate the applicability of sense-making to health and wellness.

Inside the Blogroll: Andrew McAfee

2008-11-21T08:56:00.003-05:00

This is the first post in a new, occasional series, in which I profile one blog I read regularly. I have a long list of blogs in my RSS reader, and I'll talk about what's on the list and why I read it.

First up: Andrew McAfee: The Impact of IT on Businesses and their Leaders

Andrew McAfee is an associate professor at Harvard Business School, and he studies how IT investments have contributed to competitive advantage. Of particular interest is his focus on Enterprise 2.0 (a term he coined)--how social technologies akin to Facebook, Twitter, etc., could help enterprises, and what the barriers are for their adoption.

It's a great blog, with lengthy, detailed posts; lots of excellent comments; and a combination of techie-business focus that I like a lot.

Tags:
blogs, information technology, inside the blogroll

"Public relations firm took too long to change to home-based business"

2008-11-20T09:47:00.003-05:00

From The Mistake Bank:

Reporter Marcia Pledger of The Cleveland Plain Dealer has been collecting and publishing great small-business mistake stories for a while. Here's a nice one about the cost of worrying too much about what others' perceptions might be:

A manufacturing company told me that if I started a public relations firm, I had its business. My next move was to find a location. Relationships are one thing, but I needed credibility for prospects.

Starting a business from my home 22 years ago was not even a thought. Back then, home-based businesses were not considered "real" businesses, so I leased an office....

read the rest of the story at the Plain Dealer site here.

Mistake Bank, mistakes, narrative, location, perception, entrepreneurism

Shop Talk Podcast #16 - Robert Wiesheu on Selling in Different Cultures

2008-11-18T13:25:00.004-05:00

For this edition of the podcast, I'm delighted to spend some time with my friend Robert Wiesheu, one of the most interesting guys I know and someone who's spent more than a decade selling to customers in Europe, the Middle East and Africa. As such, he has a great perspective on what it takes to successfully sell even if you don't look or sound like the people you're selling to.

Podcast file (18.2 MB, 15min51sec)

Highlights:

1'25" Challenges in selling into different regions
5'00" Preparing to sell in a country for the first time
6'10" Is there bias against a foreign salesperson?
7'25" What to think about when preparing a product for worldwide sales
9'10" Working with in-country agents

Theme music: "Up the Coast" from West Indian Girl's album 4th and Wall.

Tags:
podcast, sales, culture

The value of the "ack" in personal networking

2008-11-17T08:49:00.004-05:00

My technical background is in computer networking. I spent my twenties studying network protocols, designing queueing systems, and working on security issues. It was a great experience that is still useful today, 20 years later, now that everyone uses that Internet thing.

One principle of networking protocols is the idea of guaranteed delivery versus nonguaranteed. Basically, when you send a message over the Internet, it is broken up into tiny pieces, called packets, and sent down the line, mixed up with all sorts of other packets, and finally reassembled into a message on the other end.

With nonguaranteed delivery, the message is just sent out, and the sender doesn't really know if it got there (believe it or not, there are good applications for this). With guaranteed delivery, by contrast, the receiver sends an acknowledgement (or "ack") to the sender saying, in essence, "I got your message, thanks."

The "TCP" in TCP/IP is a guaranteed delivery protocol.

I was thinking about this because I am doing less computer networking these days and more personal networking. Emailing, Twittering, spending time on the phone. And the "ack" concept works just as well here. (Another metaphor for an ack is a "handshake." I like that one.)

Email, to me, is a nonguaranteed delivery protocol. From a technical standpoint, that's nonsense--Simple Mail Transport Protocol (SMTP), of course, sends acknowledgements to your mail server when your message is delivered. But I'm talking about personal communication.

When you send an email, you don't know if someone got it unless they respond. This is the "ack." For much email, lack of acknowledgement is fine. But for others, acks can be very important to maintaining and enhancing your relationships. For example:

If someone refers a prospect to you, you should first acknowledge that you got the referral (thanking them is also good!), and you should send another ack when you get or don't get the business. The referrer is curious to know, and also wants to see if you follow through on referrals.
If you ask someone a question, and they respond via email, a short ack is good. "Thanks, that helps." They know then that you took the time to read the response and (hopefully) make use of it.
If someone asks you a question on email, and you don't have time to answer, you should acknowledge you received it and when you think you might be able to respond. That way the sender doesn't sit waiting for your response to arrive.

There are probably lots of other good times to send an ack. Please post your own ideas in the comments. Thanks, and I'll try to acknowledge all the contributions :-)

Tags:
relationships, networking, communication, email

Where are you on the Bloggers' Continuum?

2008-11-16T11:38:00.006-05:00

Tags:
blogging, blogs, weblogs

A silly but fun use of Twitter

2008-11-14T03:38:00.000-05:00

Many people say, "What on earth is Twitter good for?" and there are lots of answers. One in particular: it's really great for providing a real-time status of a bad Mexican wrestler-monster movie that you watch while you eat dinner at the bar. See below (note to those unfamiliar with Twitter: the first post is at the bottom; the last is at the top). Enjoy!

Tags:
Twitter, communication,

Getting out the stories of Burmese prisoners--an heroic feat

2008-11-13T04:32:00.000-05:00

George Packer's Interesting Times blog from The New Yorker yesterday discussed Human Rights Watch's honoring of a Burmese hero, Bo Kyi. Mr. Kyi had been held as a prisoner by the Burmese government, enduring the brutalities of that unique brand of confinement. Upon his release, Mr. Kyi moved across the border to Thailand and founded an organization, Assistance Association for Political Prisoners in Burma, the mission of which includes "report[ing] on the military regime’s oppression of political prisoners who are presently detained in various prisons."

My Kyi's remarks on accepting his award were powerful, and are excerpted in Packer's post. I found this passage particularly striking:

We have a way to communicate with the prisoners and get their stories out. I cannot tell you how we do this. I do not want the Burmese regime to find out. But I can tell you that these stories fill the pages of our reports and those of Human Rights Watch.

The media use these stories. So do political leaders around the world. Over time, the stories of these prisoners generate pressure on the international community to take a stand.

Burmese dissidents are outgunned and outmanned. But they have ideas and stories on their side. Who doubts they will win someday?

Tags:
change, dissent, leadership, protest, communication, storytelling

"Sesame Street simple" communication with a story

2008-11-12T10:25:00.007-05:00

My first reaction to this Bob Sutton post--"Sesame Street Simple: A.G. Lafley's Leadership Philosophy"--was a slight recoil. Perhaps because I thought we had tapped out on learning from A.G. Lafley (can't we let the man run his company in peace?). But also because my natural communication style is not "Sesame Street simple." Unsure of that? Read this blog for a while.

But, after letting it sit a few weeks, I'm starting to get what Sutton is saying. He's onto something important about communicating with and influencing large numbers of people:

...although executives who talk about many ideas and complex ideas will be viewed as smarter -- wiser and more effective executives pick just a few simple messages and repeat them over and over again until people throughout the organization internalize them and use them to guide action. Constantly changing messages lead to the "flavor of the month problem" where people don't act on the current message because they have learned that, if they wait a few months (or days) the message will change (managers in such organizations become very skilled at talking as if they are acting on the flavor of the month, but not actually doing the thing that senior executives are pushing at the moment.) And making things overly complicated may make the senior executives seem smart and feel smart , but if a message is too complicated to understand, it is also means that the implications for action are impossible to understand as well.

Managers "talking as if they are acting...but not actually doing" recalls the damaging "false urgency" that inflicts many companies, as John Kotter discusses in his new book.

There's a way to do "Sesame Street simple" in a way that provides powerful insight and direction. Telling a story. Stories can be understood by everyone. They can be retold and honed for a particular group ("what's our 'the consumer is boss' story?"). They can convey complex lessons and spawn deep discussions about meaning.

That's a "Sesame Street simple" approach even I can understand.

(Photo: Hokey Pokey Elmo from Toys R Us)

Related Posts:
On John Kotter's "A Sense of Urgency"
More on "A Sense of Urgency"
A.G. Lafley: "The Consumer Is Boss"

Tags:
change, innovation, leadership, management, communication, storytelling

From The Mistake Bank: Sue Pera on the downside of expansion

2008-11-11T03:32:00.002-05:00

From The Mistake Bank:

This is the first of a series of interviews with businesspeople about mistakes they've made in their careers. If you'd like to be part of this series, email me at john (at) caddellinsightgroup (dot) com.

Find more videos like this on The Mistake Bank

Sue Pera is the owner of the Cornerstone Coffeehouse in Camp Hill, PA. Visit them on the web at http://thecornerstonecoffeehouse.com. (Disclosure: I usually hang out here on Friday mornings, when the cleaners come to do my office. It's a great place; if you happen to find yourself in Camp Hill, you must stop by.)

Tags:
Mistake Bank, mistakes, narrative, customer relationships, expansion, growth, entrepreneurism

Creative Destruction? #2

2008-11-10T09:31:00.006-05:00

It's been two months or so since I visited a couple of places nearby in the midst of what Joseph Schumpeter might call "creative destruction." At the moment, they're just abandoned buildings. I'll keep visiting and see how/when these places shape up and begin contributing to the economy again.

32nd Street, Camp Hill, PA, 10 Nov 2008

Carlisle Pike, Silver Spring Township, PA, 28 Oct 2008

Related Post:
Creative Destruction?

Tags:
creative destruction, renewal, failure

Is "renting the new buying"?

2008-11-07T04:33:00.001-05:00

Hobby Princess blogs very infrequently these days (I'm guessing that a new baby in the house has something to do with that). Nonetheless, when she posts, it's essential reading. Her most recent post, "Renting Is The New Buying," theorizes how the recession might alter our consumption habits.

She writes:

Cheap things don’t feel like luxury, because luxury is not just a sensual, but also a social experience.

In the recent Sex and the City movie there is a wonderful experience of consuming luxury in a sustainable way. Carrie notices that her assistant-to-be brings a genuine Luis Vuitton handbag to the job interview and asks the young woman (Jennifer Hudson) how she can afford it. Her answer is: “I rented it”. Indeed a breed of new online services, such as borrowbagorsteal.com, froxylady.com, and fashionhire.co.uk offer designer dresses, hats, bags, sunglasses, and jewellery for hire.

We are already used to rent apartments, washing machines, paintings, bikes, laptops, phones, copy machines, badminton rackets, power tools, and even pets for short periods of time. But perhaps we should think about renting and borrowing on a broader scale, as a real alternative to owning.

John Quelch has written about the rise of the "simplifiers," who are getting rid of their stuff and downsizing. This group still invests in experiences--often "rented"--like vacations.

So, what do you say? Are we starting to simplify? And will that mean renting more and more of what we use?

Related post:
The era of cheap s--t is over

Tags:
economics, purchasing, consumption, recession, credit crisis

John Quelch on Obama's marketing triumph

2008-11-05T17:31:00.004-05:00

Harvard's John Quelch knows a thing or two about marketing and politics, having co-written the recent book Greater Good: How Good Marketing Makes for Better Democracy, a detailed examination of the similarities and differences between commercial marketing and political marketing.

In this post, he efficiently and clearly dissects the many ways in which Obama's marketing superiority contributed to his victory (while acknowledging the stacked deck McCain competed against). It's a terrific, timely analysis.

Related posts:
On "Greater Good"
Podcast with John Quelch on Marketing and Democracy

Tags:
marketing, democracy, politics

Innovation made easy... or else

2008-11-05T03:34:00.001-05:00

Many of my posts originate when two interesting ideas collide--two things I've read, possibly from very different points of view or with different objectives in mind, somehow fit together, or together illuminate something to me that's clearer than either piece on its own.

Today there are three such things. Let's call them stories of innovation made easy. First is the paper "The Ergonomics of Innovation," by Bob Sutton and Hayagreeva Rao in September's McKinsey Quarterly, which despite its awkward title is very clearly written and argued. Its central point, illustrated by the Institute for Healthcare Improvement's campaign to save 100,000 unnecessary hospital deaths, is that the best innovations are often the simplest and most basic. In other words, a partial solution that is easy to communicate and to implement may bring far more value than a more complete solution that is more complex and difficult to bring into production. Here's a synopsis of Sutton's and Rao's argument:

A basic idea from ergonomics is that physical and cognitive “affordances” can help people to think about, know, and use something more easily and to make fewer errors. The IHI campaign didn’t use the language of ergonomics but nonetheless applied its logic in hundreds of ways by designing and spreading affordances that made it easier for the staffs of the participating hospitals to change.

I've meant to write about this article for several weeks. But two more things I've read this week buttressed Sutton's and Rao's arguments. First is a report from Mark Schneck at Anecdote on a talk from this year's ActKM Conference in Australia. This simple change didn't save 100,000 lives but may have saved 100,000 hours wasted reading emails:

Jane mentioned that one of the actions from their knowledge strategy has had a big impact. This simple action was for all staff to write a clear description in the subject line of their emails. Adopting this practice has helped staff deal with information overload by being able to quickly identify emails that they need to deal with, and which ones can be simply deleted.

Finally, today Andrew McAfee blogged about an innovation at American Airlines that simply isn't sticking:

According to American, "Customers with PriorityAccess privileges will be invited to board first or board at any time through their exclusive PriorityAAccess lane, which allows them to bypass lines after general boarding has begun." The new configuration seems to be pretty uniform; I’ve seen it at every airport I’ve flown out of over the past month, which is more than a couple.

The new configuration also seems to be uniformly ignored. My fellow travelers and I have continued to line up and board just as we always do, except now we use two narrow lanes instead of one broad one. I haven’t yet seen us fliers make any effort to sort ourselves into the ‘right’ lane, and I certainly haven’t seen anyone voluntarily take themselves out of the lane reserved for the elites and rejoin the general boarding hoi polloi.

More importantly, I also haven’t seen American’s gate agents make any effort to sort us properly. I’ve heard them make announcements about the two lanes, but that’s as far as it’s gone....

It struck me at some point over the past month that I was witnessing an excellent example of why so many business improvement efforts fail: it’s not that they’re not good ideas, it’s that they're not easy enough to enforce. American’s PriorityAAccess boarding procedure is a straightforward case of what used to be called ‘business process reengineering,’ and it’s also a microcosm of why reengineering so often failed. It’s one thing for a small group of smart people to study an existing process and figure out a way to execute it better. It’s quite another to then deploy that new-and-improved process broadly -- across many business units, geographies, and/or interdependent groups.

In other words, the PriorityAAcess procedure didn't provide enough affordances to allow harried gate agents to easily deploy it. So they didn't.

This is an important lesson for me. My automatic mindset seeks out the elegant, complete solution. I don't gravitate toward the simple, dumb solution. Even though, as I'm learning, that one may be the best of all.

(Bonus: this also reminded me of the previously blogged about innovation at a Singapore hospital, where a cheap webcam helped significantly reduce wait times in the emergency room.)

Related post:
Stop studying the problem, and just try something!

Tags:
product development, product management, simplicity, innovation, ergonomics

Comparing two customer research approaches

2008-11-04T03:49:00.000-05:00

I had two remarkable experiences today.

First, I interviewed a marketing manager about some software he uses. He spent thirty-five minutes describing why the company chose the software, how he used it, how he learned to use the features over time and thereby developed proficiency in an area of marketing he hadn't known well before, how the supplier had given him very responsive support, how the user's group had helped him... and, by the way, three or four features that, if they existed, could really help him. I recorded everything and will review this and a number of other interviews with the client using narrative sensemaking approaches. In the end, they'll get a deep, detailed picture of how they're viewed by their customers. They'll know features that customers will value. And they'll know some things that bother their clients.

Later in the day, I got a survey to fill out. It looked like this:

Rate each question on a scale of 1-5, with 1 being Poor and 5 being Excellent.

* Trainer communicated in a clear, concise, and easily understood manner.

Comments:

* Demonstrated that he is knowledgeable in [...].

Comments:

* Displays pride, enthusiasm, and a positive attitude in his work.

Comments:

* Demonstrates a professional attitude and supports the [client].

Comments:

* Practice topics are clear and correct for [skill and experience].

Comments:

* Trainers were timely and approachable with problems and concerns.

Comments:

It's unfair, I know, to compare the two approaches. The first is more expensive and time-consuming. There is more at stake for the software company than for the second group, a nonprofit.

But, really, what can one possibly learn from the second approach? Isn't the interview method better in about 1,000 ways?

Tags:
market research, narrative, interviews, surveys

A salute to free thinking

2008-11-03T03:37:00.000-05:00

By free I mean it doesn't cost anything. It's also the other kind of "free," too--unconstrained and bold.

What I'm talking about is the insight and information available today on blogs. It's absolutely remarkable what is on the net, as close as your browser or RSS reader. By any measure, it's tenfold or onehundredfold what the most curious reader had access to ten years ago.

I haven't canceled my newspapers yet, but not one of them (not even the Times) can provide a list of contributors this strong. Here is who I read every day, whose insights I cherish and who make me think new things:

Bob Sutton
Fred Wilson
Dave Stein
Andrew McAfee
James Surowiecki
George Packer
Doc Searls
Rita Gunther McGrath
Jill Konrath
Tim Berry
John Quelch
Nancy Baym
Andrew Meyer
John Jantsch
Ford Harding
Ulla-Maaria Engeström (Hobby Princess)
Dave Snowden
Cognitive Edge guest blog
Harvard Business School Working Knowledge
Garr Reynolds

So... who am I missing? Who else should be on my RSS feed list?

The voices say: time to read "War and Peace"

2008-11-02T16:01:00.004-05:00

Sometimes something tiny can influence us, such as a Tweet--this one:

Increasingly amazed (and worried) at the number of people I know and respect who do not read novels.

Then today I read this blog post: "Tolstoi's Guide to Complexity," about "War and Peace." The post's author, Jochum Stienstra, writes eloquently about how the book has influenced his thinking since he read it fourteen years ago.

Okay, I said. This is a message to me. Time to put aside the stack of unread business books and spend a little sabbatical reading an old classic. I've picked up and put down "War and Peace" perhaps ten times. Never read it.

Now it's time. I dug my old Signet Classic edition out of the box and cracked it open. Again.

complexity, narrative, novels

Your voices needed to help a worthy project

2008-10-30T10:10:00.006-04:00

Can the sharing of stories bring a community together?

It worked in the olden days, but has become a lost art in the age of television, internet, and videogames. Robert Putnam's book "Bowling Alone" described a society where isolation reigns and communities are frayed.

My friend and colleague Cynthia Kurtz has applied for a Knight News Challenge grant to develop web2.0 software precisely to facilitate the gathering, sharing and passing on of stories that used to go on around the campfire or village square. The Knight folks want the public (that means you) to review and comment on the applications. It would be doing a great service if you would visit the site here and weigh in on Cynthia's application.

Here's how she describes the project:

Long ago, story caretakers tended the diverse stories of the community: eliciting, understanding, maintaining. But those traditions have declined as commercial storytelling rose and community coherence fell. The physical-digital split means that today older people tell stories in community centers while younger people tell them on Facebook. People still tell stories, but no one is bringing all of the stories together into community-wide patterns, making sense of those patterns, and helping the stories get to where they need to be in times of need. We are building a free and open source software package called Rakontu ("tell a story" in Esperanto) that will help communities share and work with raw stories of personal experience for mutual understanding, conflict resolution and decision support. By supporting and bridging online and offline storytelling, Rakontu will help communities regenerate the sustaining functions of story caretakers so that they can take better care of their stories again.

An important part of the project is how this would bring benefit to communities. Cynthia explains it this way:

Rakontu will help communities tell, annotate and connect stories; discover insight-creating patterns in them; and use stories to resolve conflicts and make decisions together. This degree of support is only available today through the help of experienced narrative practitioners. Rakontu will embody understandings about narrative in communities so that people will not have to know anything about narrative to benefit from its use. Some possible outcomes are better understandings of opposing perspectives, a greater diversity of voices being heard, better consensus on tough choices, more problems dealt with before they get worse, safer streets, fewer footholds for extremism and paranoia, and greater common strength in times of crisis.

I've written in this blog, over and over, about the use of stories for knowledge sharing, learning, and creating insight. You're probably tired of reading about it. But think about this: we should be using every tool at our disposal to help bring our communities together, to combat the "bowling alone" syndrome, and make our neighborhoods a better place to live. That's what Rakontu can do, and I hope you'll visit the Knight News Challenge site and support Cynthia's application.

(Disclosure: I have worked with Cynthia on this grant and will be conducting community trials of the software if the grant is awarded. Therefore I have a vested interest in getting the grant approved.)

Tags:
community, narrative, virtual communities, sensemaking, storytelling

A good review of books on visual thinking

2008-10-29T15:43:00.002-04:00

Direct link to the Strategy+Business article here.

Books mentioned in the article:

Tags:
communication, comics, visual, graphics

"What Was Privacy?" Indeed!

2008-10-28T09:56:00.006-04:00

Compare these two quotes:

I have a date there with Samer Takriti, a Syrian-born mathematician. He heads up a team that's piecing together mathematical models of 50,000 of IBM's tech consultants. The idea is to pile up inventories of all of their skills and then to calculate, mathematically, how best to deploy them....

Takriti, a slim 40-year-old with wide, languid eyes, opens the door of his small office. He wears a rugby shirt tucked tightly into blue jeans. I tell him that being modeled doesn't sound like much fun. I picture an all-knowing boss anticipating my every move, perhaps sending me an e-mail with the simple message, "No!" before I even get up my nerve to ask for a raise. But Takriti focuses on the positive. Imagine that your boss finally recognizes your strengths, he says—maybe ones that are hidden even to you. Then he "puts you into situations where you will thrive."

Still, Takriti confesses that he's nervous.... With time, he and his team hope to build detailed models for each worker, each one complete with a person's quirks, daily commute, and allies, perhaps even enemies. These models might one day include whether the workers eat beef or pork, how seriously they take the Sabbath, whether a bee sting or a peanut sauce could lay them low.
(from "The Numerati," by Stephen Baker, excerpted in Business Week, 28 Aug 2008)

-and this-

Harriet Pearson is IBM’s chief privacy officer, a role she assumed in 2000, when Lou Gerstner was CEO. Gerstner was “convinced that as the Web emerged as a business platform, companies—particularly one such as IBM—had to lead on privacy,” Pearson says. “We were at an inflection point with respect to the pervasiveness of technology in business processes, and he correctly judged that IBM needed to use its leadership on that issue to support our initiatives on e-commerce.”... In 2005, under Chairman and CEO Sam Palmisano’s leadership, IBM adopted a forward-looking global policy that forswore the use of employees’ genetic profiles in making decisions about hiring or access to health insurance and other benefits. Pearson credits IBM’s own “DNA” in issues of employee privacy and nondiscrimination for the logic behind its policy on genetic profiling. “There’s a direct line that I can draw back to our history in the 1950s and 1960s that is consistent with who we are as a company,” she says. (In May 2008 George Bush signed into law the Genetic Information Nondiscrimination Act. IBM’s early support facilitated its passage.) IBM’s manifold adventures in new technology—including systems for accelerating genomic research and pharmacological innovation—enable it to foresee developments that have implications for privacy. Pearson says it’s part of her job to scan company and industry horizons for potentially gnarly situations: “My business needs make me as likely, in one day, to be looking at genetics and RFID, and what they mean for privacy issues, as at data privacy and security issues associated with global business processes and the emergence of what’s being called ‘cloud computing.’” (from "What Was Privacy?" by Lew McCreary, Harvard Business Review, October 2008)

Both quotes concern IBM. And so, are you as confused as I am?

A company that characterizes itself as a privacy pioneer is mathematically modeling its consultants? This is what happens when cognitive bias embeds itself in a bureaucracy. IBM's people consider themselves privacy pioneers, yet at the same time they install procedures that to an outside observer are clear invasions of their employees' privacy.

Let me relate a little privacy story. A few years ago, I was involved in a dispute with my employer over an employment contract. While this dispute was ongoing, I still worked at the company. One day, I looked at my laptop, and thought of the servers and networks that carried my emails, web searches, etc., to the internet. The company could have been capturing all this information, scrutinizing it, and twisting it into evidence to support their case.

I felt a chill. What had I searched for? What emails had I sent? What personal information would they have access to? At that moment, I didn't have trust in the company's good will. Quite the opposite.

God forbid they would have had a "mathematical model" of me.

It's clear that people ascribe good motives to their own actions, while in others those same actions would seem questionable or downright wrong (see "I'm OK, You're Biased" by Dan Gilbert). The question is, who can blow the whistle at a large corporation? Who, at IBM, could say, "This is just wrong. We shouldn't be doing it," and be listened to?

UPDATE: Please read Harriet Pearson's comment below. She points to this blog post as an elaboration of IBM's views.

(Thanks to Cognitive Edge for the pointer to the Business Week excerpt.)

(Photo from bretwalda via stock.xchng)

Tags:
privacy, information technology, organizational behavior

How to ask your clients uncomfortable questions

2008-10-27T10:47:00.004-04:00

We know when selling that we need to probe our clients' needs, ask sensitive questions, or, on occasion, ask for favors. To some people, this comes naturally. The rest of us can rely on this advice from Ford Harding about how to pose some of these tricky questions to clients--questions that can be uncomfortable to ask, but essential to expanding a network and growing a business.

A teaser:

Purpose: To be seated next to possible client at party
Words: I have wanted to get to know [name] for a long time. Would you consider seating us near each other at dinner?

Read Ford's entire post.

Tags:
sales, networking, communication, questions

B2B buyers--please tell the losers why they lost

2008-10-24T10:10:00.006-04:00

I've worked on a lot of sales proposals over the years. It works this way: a company needing to buy supplies, services or products invites a number of companies to bid on the business. Frequently, they'll develop Requests for Proposal laying out all their needs, criteria, etc. Companies submit their proposals, and over several iterations, the buyer selects.

It's, as succinctly described by Harvard's John Quelch, a winner-takes-all contest.

Problem is, there are many losers in that contest. Depending on the industry, perhaps only one out of ten proposals results in a sale. It's a terribly opaque process for the bidders (which opacity benefits the buyer). Not surprisingly, sellers view "the RFP process" as undesirable and frequently unfair.

There are countless systems for increasing your company's odds of winning proposals. Identifying the power base, deploying flanking strategies, etc. Dave Stein at ES Research can help you sort through who offers these services, if that's your aim.

I'm interested in something else. How to extract value out of a losing proposal. And it'll take some behavior changes on the buyer's side. Ready?

I've been working more on the consumer-marketing side recently, and I am amazed by the following: companies really want to know how customers use products and why they buy the way they do, and customers, by and large, are willing to tell them.

On the B2B side, it couldn't be more different. Losing bidders are frequently afraid to ask or eager to look forward to new opportunities. Buyers don't want to dwell on the process after it's done, nor do they want to spend time with a bunch of bidders asking questions or, worse, trying to rescue a losing sale.

It's got to change, and here are two reasons why: (1) a failed proposal effort is expensive for the seller, and (2) lousy proposals are costly for buyers. The process needs to be mined for all the value possible. Insight is the most valuable mineral in a failed proposal effort. Why did I lose? What did I do wrong? What did I misinterpret? How do you view our product/service against our competitors? What was most important to you? What was less so?

The answers to these questions are the B2B equivalent of consumer market research. It's not enough to ask those who selected you why they did (though that's rarely done, either). It's even worse to make assumptions, but that's what I've experienced, or committed, most. "The product was insufficient." "They didn't like our terms." etc. are only meaningful if they reflect the true thoughts of the client.

So: buyers need to have after-sales reviews with each losing bidder, explaining (without violating confidentiality provisions) why they chose the way they did, and what the bidder could do differently to improve its chances next time.

Losing sellers need to listen with open ears, seek clarification and elaboration, not challenge the decision nor try to reopen the process. (It might be less threatening if disinterested parties attended these sessions, not the lead salesperson.)

Putting this simple protocol in place will help buyers make better decisions, and sellers create better products, services, and proposals.

Please weigh in with your thoughts. Email me (john at caddellinsightgroup dot com) or twitter me (@jmcaddell) if you'd like to discuss this idea more.

sales, B2B, proposals, postmortem

AG Lafley on P&G's innovation culture: "The consumer is boss"

2008-10-23T09:57:00.003-04:00

In the newest issue of Booz & Co's "Strategy + Business," A.G. Lafley describes the innovation culture at his company, Procter & Gamble.

Hearing insights from Lafley and P&G about innovation is becoming a cliche, but this quote struck me as apt:

So we expanded our mission to include the idea that “the consumer is boss.” In other words, the people who buy and use P&G products are valued not just for their money, but as a rich source of information and direction. If we can develop better ways of learning from them — by listening to them, observing them in their daily lives, and even living with them — then our mission is more likely to succeed.

This what I'm thinking about much of the time now. How to help companies listen to, and learn from, "the bosses."

narrative, sensemaking, innovation, product management

Gathering customer product insight using Twitter

2008-10-23T04:21:00.000-04:00

Gathering and sorting through customer feedback is an overlooked part of the product manager's toolbox. Currently-used methods are inadequate to the task: surveys are limiting and misleading (one man's 4 is another man's 3, and so forth). Focus groups are biased and prone to takeover by assertive voices.

Fine-grained, freeform feedback, such as is gathered in customer service calls (or, as I'm doing with one client, in open-ended interviews), provides a wide range of opinions from a diverse group, relatively untainted by outside influences, measurement bias and company hypotheses.

The new social applications offer a new and promising way to gather feedback cheaply and in real time. Twitter is one such application being put to use.

Dell and Comcast, for instance, troll Twitter looking for references to their products and services. If people are struggling, their Twitter users will reach out and try to solve the problem, or point them in the right direction to get help. It's as if a call to tech support was being worked on in public. It's highly responsive, and the users who get this kind of attention appreciate it, usually announcing their satisfaction in a Tweet.

Other times, Dell in particular responds quickly to critiques of their products (see an earlier post and a Dell comment). It's done well--not pushing back on the commenters, but certainly getting the company message out in that forum. In other words, comments on Dell products are always responded to.

Both the above examples have obvious PR benefits and bring the Comcast and Dell folks who engage in these conversations closer to the real customer experience. All good.

What I'm talking about, in addition to that, is collecting dozens or hundreds of tweets on a particular product and looking at them all together. What do they say about the product? Are these issues that seem to crop up continually? Are people using the product in unexpected ways? Is something about the product really, really annoying people?

Note that gathering the data is easy. Sorting it out is the hard part, but using narrative analysis techniques can separate the wheat from the chaff and give you real, useable insights.

(Here's an example of the Twitter conversation around the new Ford Flex. I hope Ford's product marketers are listening! Here's another conversation on the Flip video camera)

There are other ways to gather freeform customer feedback. Customer reviews on Amazon, for example. Blog posts. Companies should use all of them. Particularly as these technologies become more embedded, and more people start talking in these forums, the stories customers tell will be more and more vital to innovation and the product creation process.

(If you'd like a comprehensive look at how businesses can use social technologies to engage with the outside, read Groundswell by Charlene Li and Josh Bernoff)

Related posts:
Dell's web2.0 efforts pay off
Is Google listening to the stories around Knol?
On "Groundswell"

Tags:
narrative, sensemaking, innovation, product management

"What if your whole company acts like an a--hole?"

2008-10-22T08:22:00.003-04:00

I was talking to my friend this morning about Bob Sutton's "The No Asshole Rule" and its corollary, "if you can't escape working for an asshole, you need to learn how to be indifferent, now not to care too much."

My friend's question: "What if your whole company acts like an asshole?"

He elaborated. "I went to a retirement party for a friend of mine who worked for the phone company. They've been downsizing forever. There are guys who have been there 25-30 years, and they're trapped. They hate it there, but they have nowhere else to go. So they go through the motions. It's filled with people like that."

Me: "Economists keep telling us that economies of scale mean big companies have advantages."

Him: "Scale economies must mean a lot if those companies still make money, while they're full of people who don't care anymore."

Disclosure: I've worked for very large companies and very small companies in my career. As you can probably guess, I liked working at the smaller companies better.

Related posts:
The Value of Not Caring in the Workplace

Tags:
indifference, equanimity, narrative, organizational behavior

The era of cheap s--t is over

2008-10-20T03:26:00.001-04:00

Our kids' piano teacher lets our kids choose a little prize after their lessons, if they've tried hard and been attentive. The other day, my wife said, after tripping over one of these dollar toys for the millionth time, "I may have to tell her to start bringing candy, instead of these little toys. I can't keep up with all the crap."

Help is on the way. Last Thursday, on NPR's All Things Considered, reporter Louisa Lim tells us that many Chinese factories who supplied the world with cheap trinkets are going out of business, victims of rising commodity prices and slack demand from the West. Chinese government action may also be a cause, according to the ATC story:

Harley Seyedin, the president of the American Chamber of Commerce in South China, says this slowdown was the result of deliberate action by the government.

"The majority of this happened because of changes in regulations last year deliberately decided by the Chinese government in order to slow down the economy and to move away from reprocessing [and those] labor intensive, environmentally unfriendly and energy-intensive kind of companies," Seyedin says. "And certainly some companies have suffered as a result of that. Those types of companies needed to go anyway."

Hallelujah. One of the byproducts of the economic slowdown will be a ratcheting down in our acquisitiveness, and a reduction in the easy credit that's allowed us to buy more crap, cheap or otherwise. To me, there's good news in that.

Tags:
economics, manufacturing, recession, credit crisis

More on "NOMO Concert"

2008-10-15T17:32:00.003-04:00

If today's earlier post made you curious about the group NOMO, here is a cool live video of a few songs. Now you can see why I was bummed I had to leave the concert so soon!

NOMO Live session from Svetlana legetic on Vimeo.

You can learn even more about NOMO at their Myspace page here.

Blog Action Day: On Poverty--A story about homelessness

2008-10-15T11:10:00.002-04:00

The roots of homelessness are complex, and whatever the precise mathematical relationship between homelessness and poverty is, people who have money typically are not homeless.

With that, here's a story.

Last January, my church took its turn as part of a coalition of churches that provide winter shelter to those in Harrisburg without homes of their own. Volunteers were solicited to work at the shelter, and on Sunday, January 20, I took a turn helping out. It was a bitterly cold night, one of the coldest of the winter. The folks, ninety percent men, began arriving in the church basement at 6pm. They took pallets to sleep on, ate a simple meal, and around 9pm began retiring. The basement was packed.

A few men huddled around a radio in one corner. I went to join them. The New York Giants were playing the Green Bay Packers for the right to go to the Super Bowl and face certain defeat against the unbeaten New England Patriots. I had begun following the Giants in 1969, when my dad took me to their training camp a few miles from our house.

It was even colder in Green Bay than it was in Harrisburg. Most of our crowd was rooting for the Giants. One guy kept predicting what would happen, then regardless of the outcome of the prediction, would say, "Just like I told you."

Well, the game ended with an overtime interception of Brett Favre and winning field goal by the Giants. They were, improbably, headed to the big game. The predictor-guy said, "Just like I told you. They were gonna win. And you know what? They are going to win against the Patriots."

Then we all went to bed. At 5am people started to get up for work. I got two guys' lunches out of the locked fridge. We made coffee and set out pastries. By 7:30 everyone had left. We straightened up, then went back to our own lives.

The predictor-guy was right, after all. The Giants won the Super Bowl. And even though it's been many months since that night in the church basement, my mind returns there from time to time, and I wonder where those folks are right now, if they're healthy, if perhaps they have a roof over their heads.

NOMO Concert: a plan too complex to succeed

2008-10-15T10:00:00.006-04:00

From The Mistake Bank:

(click on comic to enlarge)

See the original on Bitstrips here.

Tags:
comics, mistake s, mistake bank, narrative, contingency planning

Is there redeeming value in online ranting?

2008-10-14T10:09:00.000-04:00

I don't visit the online reader forums of my local paper, The Patriot-News, that often. But when I do, I'm always shocked, sometimes appalled, and occasionally depressed by the venom and anger that reside there.

Recently, a flood of comments accompanied the news that Anita Smith, the CEO of local insurer Capital Blue Cross for the last several years, and the star of its TV ad campaign, had resigned. A brief sample of the comments that readers posted (you can read the entire list at the link above):

I've always heard she's a complete and total witch who would step on her own mother's back to get what she wants!

I'm not sure how she got the job in the first place with a Bachelor's Degree from St. Joe's??????????
I really couldn't believe it when I discovered that fact! UNREAL

Thank goodness we won't be subjected to those awful commercials of hers anymore!! I had to mute the TV and look away every time I saw her smug mug dancing around on my TV. Seeing them in HD made it even more difficult to suppress the gag reflex.

It's about time she got canned. She should have never had the job in the first place.... and sure they could have picked a worse picture of her. There are some out there..really bad ones.. from before she spent lots of premium payers dollars getting herself a complete makeover.

Now, if only Mary Sammons would follow suit, maybe Rite Aid could get out of the toilet.

It's difficult to find redeeming value in this name-calling, envy, schadenfreude and misogyny. My first reaction was to ask, "Can't we be a bit more civilized? Can't the editors do something to elevate the dialogue?" But as I've thought more about it, I think we should leave the forums just as they are.

While forum entries are frequently presumptions, value judgments or downright fabrications, even the most objectionable ones are essentially true.

What I mean is this: they are true to the teller. The writer of a forum item believes what he or she is writing, believes it enough to sit down at a computer and type it and hit "enter." Given that, of what use is censorship? Removing the item or preventing its telling in the first place will not change the opinion of those who would write about it in the first place. There are themes, moreover, within the comments, that are important to appreciate: that there is great anger at people who lead our companies, that many don't accept women in executive roles, that people are hurting in general.

In other words, the forum entries show us the world as it is, as opposed to the world as we would wish it to be.

And, even among the vitriol and hate displayed in the forum, legitimate questions were raised, such as: how much did Capital Blue Cross spend in advertising, and how much should a non-profit insurer spend for image advertising? Those questions spawned off some interesting reporting in the Patriot-News.

These posts must have been painful for Anita Smith and her family and friends, if they paid any attention to them (hopefully they ignored them). But that's the price of prominence: you will be treated unfairly by people who don't know you at all. When people feel threatened, uncertain, or at risk (like now), they will lash out at those who caused (or who've sidestepped) their difficulties.

And I'd rather know what people are really thinking than be able to pretend that we as a society have grown past those thoughts, even if they're unpleasant.

(Disclosure: this blog is available as part of the Patriot-News' pennlive.com)

Tags:
social media, newspapers, Patriot-News

Giving myself the "Getting Things Done" treatment

2008-10-13T10:07:00.004-04:00

I knew I had to improve my organizing skills early in the summer when I missed two scheduled conference calls in the period of a month. In the moment, I blamed the meeting organizers, who had not attached reminders to the meeting requests, so my Blackberry didn't buzz 15 minutes in advance. After reflection, I realized it wasn't the responsibility of the meeting organizers to account for my time-management peculiarities. I also realized that making a habit of missing conference calls I had committed to attend was bad business.

Around the same time, I listened to a podcast interviewing David Allen, author of Getting Things Done. I liked what he had to say, and a few mouse clicks later I had ordered his book, determined to give myself the GTD treatment.

It wasn't painless, and it took quite a while, but I've been more or less successful at organizing my work and home commitments. I feel like I'm getting more done, and the stress level has decreased because I have all my commitments (work & personal) documented in the same list, and I review that list regularly (though the review could be more regular and more thorough).

First, a look at Allen's key prescriptions:

Collecting all items that need to be looked at in your inbox
Emptying the inbox frequently
Deciding what to do with an inbox item immediately (acting on it if it can be done in 2 minutes or less, disposing of it if no action required, scheduling action or adding to task list otherwise)--i.e., no returning items to the inbox!
Filing inbox items where they can be easily retrieved
Organizing task lists by context (computer, phone call, errand, on-line, reading, waiting-for)
Reviewing your calendar and task lists regularly

There's a lot more, obviously, that you can find in the book, but those are the highlights.

In my experience implementing GTD, here's what I found:

Collecting all my stuff and processing it took a long time--upwards of two weeks. I had to-do's written on note cards in my bedroom, written on my white board, in notebooks, on existing task lists, and in the inbox already. I had piles of unread books in several places, and articles I wanted to read scattered in my computer directories. At the end, the collection pile measured more than one foot high in my inbox and another three feet or so on the floor beside it.
Filing was easier than I thought. Allen recommends one alphabetically-arranged filing cabinet, rather than files organized by some subject (like home, work, finance, etc.). This works for me, although I keep my finance files in a separate accordion file. All the others are in one cabinet.
I ended up with a large task list (probably 75-80 items), and it hasn't gone down much if at all. Some people find such a large list intimidating (God, what a lot I have to do!). For me, it was a relief to know that I had everything on paper, and didn't need to carry it in my head--a key benefit that Allen cites for his system.
Personal organizer systems don't deal with the Allen approach very well. I tried both the Macintosh iCal system, which didn't allow for even a first-level categorization, and Microsoft Entourage. Entourage allowed two levels of categorization with manageable sorting problems, but couldn't handle three at all... and I wanted three for my list. I was able to work around the problems, but it would be nice to have an automated application that could sync with a mobile device and handle the entire GTD system.
Like many people, I don't review the lists enough. I schedule a brief review every day, and a more comprehensive review on Friday. I usually get through the every-day review, but the Friday review is frequently no more substantial than the dailies. I need to work on that.

Like any major change in habits, GTD takes a lot of commitment, time and persistence. For me, at least, it was worth it. I feel more in control of my life and prepared to take on more work than I was a few months ago.

Would anyone out there like to comment on their GTD experiences?

Getting Things Done, productivity, organization

From The Mistake Bank: Surprised by a large customer defection

2008-10-09T13:32:00.003-04:00

From The Mistake Bank:

The following story is excerpted from "The Knack: How Street-Smart Entrepreneurs Learn To Handle Whatever Comes Up," by Norm Brodsky and Bo Burlingham. This is a terrific book with great storytelling throughout. Brodsky uses so many examples from his storage company, CitiStorage, that by the end of the book you feel like you know that industry. To learn more about the book, visit the web site. I highly recommend it.

I still remember the moment, many years ago, when I found out we’d lost one of our biggest customers…. One of my salesmen called me in my car and told me we’d just received a fax from the customer, a major law firm, announcing its intention to move its boxes out of our facility when the contract expired three months later.

Now you have to understand that, in this business, moving your boxes is a big deal.... So it’s a real loud message when a customer leaves, and this one came completely out of the blue. I was stunned. “What are you talking about?” I said. “Man, how could we lose this account? What happened?”

The salesman didn’t have an answer, and we couldn’t get one from the customer. The people in charge at the law firm wouldn’t see us or talk to us on the telephone. Our urgent messages brought perfunctory replies: “The decision has been made, and it is final.”

Obviously, we had screwed up. The guy who had closed the account had left us five years before, and we hadn’t stayed as close to the customer as we should have been. A week or so after receiving the fax, I came up with a proposal that finally got us a meeting with the firm’s managing partner—to no avail. The situation was too far gone. We could offer good financial terms, but we couldn’t fix problems that had been festering for years. Our competitor matched the terms and got the account.

So I called my managers and salespeople together and said, “What did we learn from this? What do we have to do differently in the future?” The real lesson, I knew, was not that we had made mistakes. You always make mistakes. We failed because we’d waited too long to find out about them. We decided that, from then on, we’d go to each customer eighteen months before the end of the contract and offer to negotiate a new one. If the customer hesitated, we’d know right away that we had a problem—while there was still time to fix it.

As soon as we began implementing the new policy, we made a very important discovery. We had unhappy customers and didn’t know it. One customer was upset about our system for providing information; we fixed it. Another customer felt it deserved a lower rate because its volume had increased dramatically; the customer was right, and we made amends. A third customer didn’t like a particular aspect of our inventory system; we changed it. A fourth customer was miffed that we hadn’t been sending regular monthly reports; we started sending them.

So, in four months with the new policy, we made four improvements, pleased four customers, and locked up four accounts, and all these benefits came from one failure. In the long run, that failure proved to be one of the best things that ever happened to the company.

(c) 2008 Norm Brodsky and Bo Burlingham. Used by permission

Tags:
Mistake Bank, mistakes, narrative, customer relationships, defection, renewal, entrepreneurism

Shop Talk Podcast #15 - Scilla Andreen on the changing indie film business

2008-10-08T11:31:00.000-04:00

The latest podcast features a discussion with Scilla Andreen, co-founder and CEO of Indieflix, about the current state and future prospects of the independent film business.

Here's Scilla's official bio:

Scilla Andreen (Filmmaker, CEO & Co-Founder IndieFlix) producer, director and Emmy nominated costume designer Scilla has deep roots in the entertainment industry and is a popular speaker and tireless champion of independent film. Scilla along with producing partner Carlo Scandiuzzi created IndieFlix, an independent film distribution and discovery site founded on the principles of community, promotion, syndication and transparency. They also created indie-fest.com and are launching the Filmmaker First Initiative. IndieFlix believes Independent films can and will be profitable. You can find IndieFlix on the web at http://www.indieflix.com.

It was a great chat. You can download it here.

Highlights:

(00:50) About the US indie market

(02:20) Options to get indie films to their audiences

(06:20) Where does a filmmaker's advance go?

(09:13) What Indieflix does

(12:03) The many ways people access films and videos today

(13:00) About the "Bridge to Everywhere"

(15:35) What is a "hit" film for Indieflix?

(19:08) Promoting the filmmaker and the story behind the film

(19:33) Making meaningful recommendations for films members might like

(21:06) "If your film is worth stealing, it must be worth something"

(22:39) Looking ahead: the future of filmmaking and film distribution

(Theme music: "Nova" by Nomo, from its album Ghost Rock)

Scilla mentioned the challenge that exists for filmmakers to get clearances to use the music they choose for the film. Today's Wall Street Journal had an interesting article about this very subject: the settlement of a lawsuit between Yoko Ono and a documentary filmmaker over the use of 15 seconds of "Imagine."

Tags:
content, distribution, filesharing, film, movies, podcast, entrepreneurism

In search of Postal Buddy - the power of the negative story

2008-10-07T14:15:00.005-04:00

Once at EDS, way back when, I worked on a really big proposal. It was one of those that got you to Hawaii if you were successful, and we were, and so I spent a memorable week in Maui.

When we were working on the proposal, my boss would tell us, "Be careful. We don't want this to end up like Postal Buddy." He said it over and over again, though I had to admit I didn't really know what Postal Buddy was. It apparently was a deal in which EDS had taken on a bunch of risk that ended up badly. That much I knew.

Postal Buddy stuck in my brain all these years. Finally, in an effort to satisfy my curiosity, I called my old boss a few months ago. My goal was to get him to tell me the Postal Buddy story once and for all. "Oh, yeah," he said when I called him. "Postal Buddy....hmm... I remember the name but can't remember the story at all."

I was dumbfounded. Postal Buddy had become a fossil, the name the only remnant of the full experience (which, for people dealing with its aftermath, must have been excruciating). But it still retained its potency.

Many times since I heard the story, even though I don't know a single detail, when confronted with a risky scenario, I would think to myself, "Don't do a Postal Buddy here," and I would take a second, or third, look before making a decision.

So, the lesson: a story, even shorn of all its ornamentation, only a title and a memory, still carries emotion and resonance.

Postscript: I used a tool with better recall than me or my old boss, Google, to research Postal Buddy. There's nothing about the EDS experience, but you can find the overall story here (go to page 3).

Tags:
narrative, storytelling, failure

"Blocking and tackling"--the mother of all sports metaphors

2008-10-06T15:06:00.014-04:00

From Merriam-Webster's Collegiate Dictionary:

block verb - 1e: to interfere usually legitimately with (as an opponent) in various games or sports

tackle verb - 2 a: to seize, take hold of, or grapple with especially with the intention of stopping or subduing b: to seize and throw down or stop (an opposing player with the ball) in football.

Long-time readers of this blog will recognize my affinity with sports analogies and metaphors. So, recently, during the summer lull, I embarked upon a non-scientific study of the frequency of certain sports metaphors in business writing. And one popped up far more often than any other: "blocking and tackling."

For those unacquainted with American football, blocking and tackling are two of the most basic skills of the game--necessary (but not sufficient) ingredients for winning. Teams that can't block or tackle are doomed. For executives, blocking and tackling represent work that's not glamorous but is important.

Here are some examples:

WSJ.com Marketbeat What’ll it take to fix Yahoo isn’t a mystery, and isn’t a magic bullet, Henry Blodget writes at Silicon Alley Insider. “It’s just blocking and tackling. And it will take time.”

Innosight blog Burberry has spent more than $100 million to improve its ability to ensure that the right products get to the right stores at the right time. These challenges of course require a fair amount of blocking and tackling, but there's also ample room for fresh, innovative thinking.

NeuStar Q2 2008 Earnings conference call (COO Lisa Hook speaking): However, I asked to be on this call as a six month check-in, to assure that I am focused on delivering the basic, blocking and tackling necessary to meet our targets for growth and profitability.

This phrase was a recurring theme in executives' earnings calls (here, here and here, for example). Of course, given the recent news in the financial markets, perhaps there was better blocking and tackling they could have done.

Other metaphors I looked for that were much rarer: "home run," "unforced error" (which was popular in political writing), "icing the puck," "letting off the hook."

Did I miss any? What favorite sports metaphors do you have?

Related post:
Welcome to Sports Analogy week

Tags:
finance, sports, metaphor, management, leadership

Why doesn't the New York Times take advantage of the web's most basic feature?

2008-10-03T09:24:00.003-04:00

I read the New York Times website regularly. But I have one significant complaint. Articles on the website do not hyperlink to anything outside the Times archive. As such, the articles don't have the value and impact they could.

Here's an example. In today's Times, I read this article about the McCain campaign. I was intrigued by the following paragraph:

He has been searching for a message and a way to make a case against Mr. Obama, and often publicly venting his frustration at the way the campaign is going, as he did this week in a contentious meeting with the editorial board of The Des Moines Register.

A contentious meeting with the Des Moines Register? I was intrigued. Where was my link to more information? There was none. To find out about it, I needed to do a Google search to find this explanation (with lots of external links, by the way).

This may sound like a trivial complaint, but hyperlinking within a document to other sources is one of the primary features of Tim Berners-Lee's design for the web (described at length in his great book Weaving the Web). And it's one of the main reasons a web site is richer and more vibrant than a newspaper or a book.

So why doesn't the Times use it? Out of a misguided notion that a web site needs to keep people inside by constantly referring to itself. Every web site does that to an extent (this one does, as well), but internal references need to be leavened with numerous external links... especially when there's not an internal elaboration available (as was the case with the Des Moines Register reference).

Even if you're the Times.

Tags:
New York Times, websites, hyperlinking

Why company story-listening is democratic

2008-10-01T11:08:00.004-04:00

I'm beginning to spend a lot of time listening to stories within companies, and between companies and their customers. Listening to and understanding these stories can help companies adapt to changing markets and competitors, and help their employees work together better.

It's democratic, too. What does that mean? you may be wondering. Traci Fenton, head of WorldBlu and the leader of the corporate-democracy movement, asked me the same question a few months ago. I was trying to explain to her the connection between my work helping companies gather and act on stories and her work promoting the creation of democratic processes and institutions within companies.

To me, it makes all the sense in the world.

To be a participant in a democratic venture, you need to be informed. Lots of information, from different viewpoints, even if it can be contradictory or confusing, is essential to you doing your job, which is to participate in your own governance and direction.

You must also have a voice. Sometimes that voice is a statement at the voting booth. Other times, it is the ability to stand up at the borough council meeting and tell the council they need to approve the school-building project once and for all.

Gathering stories from employees and customers gives them a voice. Sharing them throughout the company provides critical information for employees to act on. Training folks to make sense out of them can root out complacency and provide a platform for action.

If you're a corporate leader who wants your company to be democratic, you better institutionalize the gathering and sharing of stories. From the inside and the outside.

[If you're interested in corporate democracy, you should consider attending WorldBlu Live this month in New York.]

Related Posts:
A Sense of Urgency
Corporate Change Series
Competitive Advantage: Customer-facing Employees

Tags:
narrative, learning, democracy, knowledge

Once in a lifetime... more on the financial crisis

2008-09-29T11:50:00.005-04:00

I'd love to write about innovation, growing new markets, etc., but for the moment I'm preoccupied, like many others, with the financial crisis, especially a feeling that I can only express in the words of David Byrne from "Once In A Lifetime":

How did we get here?

To that end, Harvard University held a panel discussion last week, nicely summarized at the Working Knowledge web site, that helps to illuminate the situation. Lots of wisdom and perspective here, including this sobering (but perhaps welcome) observation, from another summary of the conference by Andrew O'Connell of the HBR Editors' Blog (the post at Editors' blog also contains a link to a video of the entire event.):

As management professor Robert Kaplan pointed out early in the discussion, Americans' ability to tap into their home equity had for years masked a fundamental deterioration in their ability to pay for goods and services with their wages. And as we all can see too clearly now, what's under that mask isn't a pretty sight.

I imagine many bankers feel like the besieged, buffeted, sweating, stunned character Byrne plays in the video. Do they say to themselves, "My God, what have I done?"

finance, credit crisis, leverage, equity, banking, mortgages

A lucid description and debate on the current banking crisis and proposed intervention

2008-09-26T10:25:00.003-04:00

You may be burned out reading about the banking crisis and the prolonged efforts at agreeing on a "rescue" or "bailout" package (depending on your viewpoint). But this post and the comments at A VC blog do a great job of looking at the plan from an investor's viewpoint.

And that, after all, is what all we taxpayers will be if the package goes through. We will be the proud owners of hundreds of billions of dollars of lousy mortgages. If we pay little enough, it could be a good investment. If we pay too much, it'll cost us big time.

Corporate change #5 - role of consultants in "bringing the outside in"

2008-09-25T09:57:00.000-04:00

In earlier segments of this thread, we discussed how "bringing the outside in" is imperative for companies to keep aware and humble enough to avoid complacency and drive their organizations forward successfully. By contrast, companies in which the context inside the company drowns out voices from the outside tend to attribute their successes to their internal competencies, blame their failures on outside entities, and stagnate their way to failure.

I was talking to an old customer earlier in the month about working to help companies learn about the world outside. "Exactly!" he said. "Companies need people like you to come in and help them learn about what customers think."

To a point, yes. Having an outside perspective that is less invested in the company's culture or politics is valuable. But not at the expense of a broad, internal effort to understand and make sense of the outside world.

Referring to the business complexity literature we've touched on a few times in this blog, the world outside is a complex, messy place. It's constantly changing. So old information, and limited sources, are not very useful. To gain the best, most supple understanding of the outside, a company needs lots of eyes and ears, a diverse group gathering and interpreting information, and creating stories about it. Consultants should be among that group, but not the only or the most credible source for outside information.

Management's job is to enable that story-creation, create systems for capturing and making sense of it, and above all to honor and use it to create strategy, spur innovation, and otherwise enable Kotter's "sense of urgency."

That's a job that even McKinsey might hesitate to take on.

Prior posts in this series:
Part 1 Part 2 Part 3 Part 4

Reading list:
Gary Hamel, "The Future of Management"
John Kotter, "A Sense of Urgency"
Charlene Li & Josh Bernoff, "Groundswell"
Dave Snowden & Mary Boone, "A Leader's Guide to Decisionmaking," Harvard Business Review, November 2007.

Related post:
Complex business problems need diagnosis

Tags:
change, innovation, leadership, management, communication

Boards CAN give the CEO a proper performance appraisal

2008-09-24T11:26:00.003-04:00

The CEO is an island. His/her boss, the board, meets infrequently, has many unrelated obligations, and possesses a fraction of the corporate knowledge the CEO has. The result is CEOs who operate with little oversight--until things go horribly wrong. After which the bluntest performance appraisal is applied: "You are fired."

There is an alternative. In the October Harvard Business Review (link), Stephen Kaufman, former CEO of Arrow Industries, describes the effort his company made to create a review process that was more like the one applied to his direct reports. It involved numerous board members interviewing executives throughout the company and was intended to provide a window into Kaufman's needed development areas--and to complement the financial and business objectives he was judged on.

I wonder how other CEOs would view this type of process. Would they see it as an intrusion into their space? Or as a yearly checkup that could prevent the root canal of a surprise firing?

Customer complaints as a source of business insight

2008-09-22T11:28:00.004-04:00

We're taking a brief detour from the corporate change series to discuss customer complaints (every businessperson's favorite subject) though in truth it is very much in sync with the "letting the outside in" philosophy we've been discussing in those other posts. The Wall Street Journal's occasional Business Insight section prompted the thoughts with today's article, "Making the Most Of Customer Complaints," by Stefan Michel and David Bowen of the Thunderbird School of Global Management and Robert Johnston of Warwick Business School.

"Making the Most..." focuses on the relationship between the customer, the front-line rep, and service management, and correctly describes how to manage a complaint to minimize damage to customer satisfaction without "giving away the store," and to incent behaviors that will result in customers leaving the interactions feeling good (or at least not badly) about their vendor. It's particularly insightful when describing the conflicts the front-line reps feel when trying to deal with a difficult customer situation:

These workers have the difficult task of dealing with customers who hold them responsible even when the failures in question are completely out of their control. The attitudes of customer-service workers, positive and negative, spill over onto customers.

Yet companies do surprisingly little to support them.

To be successful, these workers need to feel that management is providing the means to deliver successful service recovery on a continuing basis. Alternatively, when employees believe management doesn't support them, they tend to feel they are being unfairly treated and so treat customers unfairly. They display passive, maladaptive behaviors and can even sabotage service.

This alienation is compounded when the workers believe that management is not improving the service-delivery process, which keeps employees in recurring failure situations. Even though complaining customers represent an opportunity to fix problems and improve satisfaction, alienated employees often see them as the enemy.

In addition to the sound advice to repair the processes, provide appropriate guidance to employees and management, and incent customer-delighting behaviors, there's a broader value that I see to studying these interactions.

Customer complaints are a window into the customer's use of the product and perception of the company. Virtually all satisfied customers are silent. Many dissatisfied customers are silent as well--calling customer service is time-consuming and frustrating. The fact that many problems aren't resolved compounds people's feeling that engaging with the company is simply not worth the trouble.

This means that any customer complaint reported to the company is a very important piece of data. Taken together, complaints can illuminate patterns pointing to product over-complexity, poor usability, underservicing, poor expectation-setting. The patterns might tell you that the customer-service approach you are so proud of is not working as well as it should. Or that customers are using a product differently from how you expected them to. The patterns serve as marching orders to product management, marketing and customer service for important value-adding projects.

But... you have to collect and sort through the data. It can't be resigned to the bit bucket because it's unpleasant or tells you things you'd prefer not to hear. I have started to work with clients to learn from customer-service interactions--the raw material, not just the statistics. And, not surprisingly, we are always surprised by what we learn.

Related posts:
Time to start listening to front-line employees

Tags:
narrative, learning, customer relationships, customer service, knowledge

Corporate Change #4 - don't leave engaging with the outside to marketing/PR

2008-09-19T12:01:00.006-04:00

In the prior post in this series, I talked about galvanizing the will to change through "bringing the outside in"--learning what customers, the press, influencers--really anyone--thinks about the company, its products, its marketplace, industry, etc.

To which a reasonable person might ask: "Isn't that my marketing department's job?" Especially with newer tools like blogs, wikis, Twitter, etc., marketing is taking the lead in engaging with the "groundswell."

While marketing has a significant role to play, they cannot own this function, any more than finance can own any decision that has to do with dollars and cents--it's too big, too comprehensive and too important to be limited to one group. Here are several reasons why:

Marketing is obsessed with brands & messages. Brands and messages are relentlessly positive--who buys a negative message? But learning comes from both positive and negative stories. There are threats as well as opportunities. Marketing is asked to convey messages, not to understand the world in all its messiness and complexity.

PR is asked to get positive stories out there, and to counter negative perceptions--not to learn or to inform the company. True dialogue involves listening--even when the conversation is negative or you don't agree with it--and trying to find lessons in that. Perception is reality, and PR tries to change perception--what we're talking about here is, by contrast, understanding reality.

The view of both is too limited. Different parts of the organization have different things to learn from the outside. Operations needs to learn new ways of working. Product management needs to understand how customers actually use products. HR needs to know how the workforce is evolving. Groupthink is also less likely when a diverse group of people is examining the world--with more likelihood that sound actions, and commitment to achieve them, will result.

Comcast's experiment with Twitter-based customer service (see example here of "Groundswell" co-author Charlene Li Tweeting for help and Comcast responding) works because the Comcast guy is trying to solve a customer problem, not deliver a message. If Charlene ends up feeling better about Comcast, it is a side effect, not the intent, of the action. The tech is also in a position to learn deeply about this customer situation and, I'm certain, to disseminate the learning to colleagues.

Imagine this fictional Twitter dialogue if Charlene had to engage with marketing instead of with a real tech (I've reversed it for readability. In real Twitter, the newest message is on top):

charleneli: @comcastmktg My connection keeps going in and out, happens every few months. Comcast Cust service has no idea why. Any way to escalate?

comcastmktg: @charleneli That's hard to believe. Comcast has the highest network reliability in the industry.

charleneli: @comcastmktg Yeah, fine. Can you help me with my question?

comcastmktg @charleneli Of course. One more thing. Did you know we have twice as many HD channels as DirecTV?

charleneli: @comcastmktg What? Who are you? Can you get me to someone who can help me?

comcastmktg @charleneli Right away. Please email help@comcast.com and you'll get a response within 24-48 hours. Have you heard about our community service initiatives?

charleneli: @comcastmktg Aaargh!

Coming next: what is the role of consultants (written by an actual consultant!) in bringing the outside in?

Prior posts in this series:
Part 1 Part 2 Part 3 Part 5
Reading list:
Gary Hamel, "The Future of Management"
John Kotter, "A Sense of Urgency"
Charlene Li & Josh Bernoff, "Groundswell"

Tags:
change, innovation, leadership, management, communication, social media

Corporate Change #3 - Bringing the outside in, for real

2008-09-18T09:33:00.006-04:00

OK, so you've read my prior two posts on the subject of corporate change, and recognized your need to greatly enhance the information you get from the outside world. Now what?

You'll need to embrace a few basic principles (it won't be easy!):

Enable employees:

Reward curiosity and information sharing
Make time and space for employees to engage with the outside world--wall-to-wall meetings are a no-no
Tap existing conduits to the outside (sales force, retail clerks, customer service reps, marketing, investor relations)
Ensure your information systems and policies don't get in the way

Listen hard:

Don't tune out bad news
Try to assemble information from many constituencies (customers, competitors, employees)
Embrace raw/inarticulate/emotional input
Honor dissent

Create systems and methods to gather and utilize information:

Deploy information "commons" where information can be posted, commented on, and passed across and up to aid in decisionmaking
Systematically gather information relevant to your business and add it to the commons
Regularly gather and sensemake commons-generated information
Use the information to inform strategy, planning, organization, etc.
Demonstrate to the employees that the information is used, to encourage ongoing contributions

Most companies are not ready for this. Some are. Those that aren't: start getting ready. If you think implementing the above is a lot of work, think how hard it is to navigate out of a crisis--an avoidable crisis, if only you paid attention to and utilized what was going on all around you.

In the next few posts, we'll dig into some specific high-value areas of bringing the outside in.

Prior posts in this series:
Part 1 Part 2 Part 4 Part 5

Reading List:
Gary Hamel, "The Future of Management"
John Kotter, "A Sense of Urgency"

Tags:
change, innovation, leadership, management, communication

Corporate Change #2 - Why are companies so inwardly focused?

2008-09-17T10:34:00.009-04:00

In part 1 of this series, we discussed one key reason companies fail to change even though it's vital: the inability to, using John Kotter's term, "bring the outside in." In other words, companies don't choose to look outside their walls to see what's happening around them, assess the implications, and absorb that into their strategies, products and operations.

Why is this so?

Reason #1 - The Community Effect
A company, as it expands from one person, to ten, to one hundred, to a thousand and beyond, takes on the identity of a community. The employees usually work in an office or plant together. They get information from the same sources--the company newsletter, intranet, staff meetings (more on that later). They spend more time with other employees than with anyone else other than family. A culture develops that inspires curiosity about what's happening inside and reduces it about what's happening outside.

Reason #2 - Leadership Arrogance
I talked to a former client last week and told him about some work I'm doing mining insights from customer-service calls. He told me, "Our CEO thinks he's just like our customers." Since this CEO sees himself as a perfect proxy, there's no reason to dig deeply into customers' feelings.

Reason #3 - Information Flows Top-Down
Leadership serves on outside boards, goes to conferences, talks with consultants. They are tasked with creating strategy, which requires some curiosity and information about the world outside the corporate walls. They process that information into strategy documents, brand images, mission statements, etc., and send it down the line.

Leadership likes orderly information, not the messiness that real engagement with the outside world creates. Most leaders believe that employees don't want that much engagement (in some cases they may be right). Employees realize that the highly-packaged, spun information that they receive is bland and biased. I recently re-encountered a saying familiar from my early working days: "We workers are like mushrooms. Leadership keeps us in the dark and feeds us s--t." I heard that expression countless times till I became a senior leader--interestingly, I never heard it after that.

Combine reasons 1, 2 & 3 and you have an inwardly-focused, uncurious company. Information is either packaged pablum from above, or internal gossip. Conduits to the outside--front-line customer service reps, retail clerks, B2B sales people--are drowned out by the inside talk. Marketing communications staffs engage with the external but are dedicated to sending out messages or countering negative news.

What we've created here is company-as-fortress. Suspicious of the outside, comfortable with colleagues, uncurious. Information is routinized and bleached of content and contrast. Clearly, there's a lot to be done to realize Kotter's prescription to bring the outside in. We'll begin discussing how in the next post.

Other posts in this series:
Part 1 Part 3 Part 4 Part 5

Related posts:
A competitive advantage: employees who spend their day talking to people
Time to start listening to front-line employees

Reading List:
Gary Hamel, "The Future of Management"
John Kotter, "A Sense of Urgency"

Tags:
change, innovation, leadership, management, communication