Kevin Rants

Kevin Hoffberg to facilitate at BAI / Mavericks in Banking Conference

For those who pay attention and care about this sort of thing, I will be one of the facilitators at the upcoming BAI / Mavericks in Banking summit.

It's a creative forum, a gathering of the financial industry's best and brightest. BAI Mavericks in Banking is specifically for innovators—those who recognize that open dialogue and passionate debate are absolutely essential. It is for leaders seeking new solutions to the fundamental business issues that impact retail financial services companies of all sizes.

 

BAI Mavericks in Banking is the place for true agents of change to roll up their sleeves and toss aside their titles—a chance to move beyond purported "best practices" and devise the industry's next practices. You'll be working with equally sharp, creative and highly motivated individuals. And you'll leave with an expanded perspective and bold approaches for directing your organization's next moves.

 

Here are the headliners . . .

 

                                                                                                                                                                                                                                                                                          

		Dick Kovacevich, Chairman of the Board of Directors, Wells Fargo Bank & Company
		Tom Brown, Chief Executive Officer, Second Curve Capital; Founder, bankstocks.com
		Bill Taylor, author of Mavericks at Work: Why the Most Original Minds in Business Win
		Lisa Heft, Founder - Opening Space
		Chris Larsen, Chief Executive Officer and Co-Founder of Prosper

 

I will also be blogging from the event with my usual eye for anything that sounds remotely related to decision making. 

kah

Blogged with the Flock Browser

Tags: BAI, Mavericks in Banking, Tom Brown, Bill Taylor, Lisa Heft, Chris Larsen, Wells Fargo, Dick Kovacevich, Prosper

Say it's not so. Motorola to leave handset business?

This bit of sad news is all over the web, but this bit from phonedog is as good as any . . .

I call "Dude, stop it," on this one.  Nomura International analyst Richard Windsor told his clients that Motorola might just be leaving the consumer handset sector entirely to focus on "enterprise and government."  Windsor's comment, published in a research note on Tuesday, was picked up by MarketWatch and Engadget, amongst others, which leads me to one important question:

Do analysts get paid more than bloggers?  If so, where do I sign up?  If I can get paid more to make stuff up entirely than to actually try to combine reporting with analysis, I'm there!  Seriously, try Googling for "Apple rumors analyst accuracy," and see what you get.  Amazing.

MOTO needs some help, but dropping entirely out of an industry they once (not so long ago) dominated is not the answer.  MOTO needs new management.  They need savvy marketing, they need better product strategy and industry vision, and they need to get past the whole, "We'll just keep making RAZRs in new colors and sell 'em for cheaper!" strategy that's defined their recent history.  But they do not need to exit the handset business, no matter what What's-His-Name-the-Analyst decided to advise his clients.

True or not, it's sad. It will surely become a case study for someone.

Way back in the day, Motorola astonished the industry with three successive releases:

The DynaTac; The world's first commercial handheld cellular phone, the Motorola DynaTAC phone, received approval from the U.S. Federal Communications Commission in 1983. The 28-ounce (794-gram) phone became available to consumers in 1984.

Next came the first truly small, clamshell phone (can't lay my hands on the picture). it was real star-trek stuff.

And of course the first "wearable phone," the StarTAC; When introduced in 1996, Motorola's StarTAC wearable cellular telephone was the world's smallest and lightest. It weighed just 3.1 ounces (88 grams).

I had all three plus, plus several of the bigger clamshell phones prior to the StarTAC and at least two more StarTACs. And then nothing. Recently I bought my wife a RaZR, but I moved on to a Treo and then a Blackberry.

If this is indeed the end of Motorola as a handset provider, it's because a great engineering company completely missed the "consumerization" of the field, let by youth in general, and Asian youth in particular.

Blogged with Flock

Tags: Motorola, StarTAC, DynaTAC, PhoneDog, decision making

Ruminations on social media after my two days at Frost and Sullivan

Assuming you're not following every post here, I've just spent the past couple of days at the 2008 Frost and Sullivan Sales and Marketing Mind Exchange where a bunch of us wandered from session to session to talk mostly about social media. My colleagues in this escapade were . . .

Cara Shockley: Internet Marketing Services Web Manager, Hewlett-Packard Company

Bill Kircos: Group Manager, Technology Public Relations Practice, Sales and Marketing Group, Intel Corporation

Lee Aase: Manager, National Media Relations, Research Communications and New Media, Mayo Clinic

Chris Heuer: Partner & Market Catalyst, The Conversation Group

Rick Short: Marcom Director, Indium Corporation

Christopher Curtin: VP Global Marketing New Media and Technologies, Walt Disney Company

At some point the sessions began to blend together so rather than comment on each, I thought I would summarize some of the big themes that jumped out at me starting with a short list of Objectives. This conversation sprung from comments Rick Short made about starting any blogging strategy with an end in mind. What follows isn't a shocking list of ideas, but it's a good starter list.

• The cost of not doing it (low "I" and high "R" . . . ROI). This may feel like a "what the hell" sort of objective, but it's not to be ignored.
• Efficiency of marketing communication. Blogging is a low cost publishing channel so it's a great way to extend whatever other communications objectives you already have in mind.
• Brand Value "we care". Objective by opposition . . . the conversations are going on out there anyway. Failing to be part of them nicely sends the signal that you don't care.
• Connecting with those who care. See the previous point.
• Personal face. This came up in connection with technically oriented offers/brands. Blogging gives you the opportunity to put a voice and a face to the bits and bytes.
• SEO. Social media and organic search go hand in hand. If you have nothing useful to say, this shouldn't be your first objective as you'll be found a fraud. But if you do . . .
• What you can learn. You don't have to author a blog to have a blogging/social media strategy. At the very least, it's a window on your world.

 

With that out of the way, here are my take-aways. Consider it a sort of Bloggers Anthem

Go to the conversations

Many of the brand holders in the various sessions were keen to talk about how to bring the conversations to them . . . either literally in the sense of hosting communities on their sites, or in attempting to manage the conversations out there. Or if they weren't interesting in doing that, they were interested in talking about those ideas. I've even been guilty of that same conceit in other businesses I've been involved with. Instead, the place to start is to go hang around in the conversations that are already going on out there (blogs, forums, etc.). Hear the voices. Read the words. Watch the videos. Once you've got the dance steps down, you'll be in a far better position to get on the floor.

Don't comment anonymously if you represent a brand (and who doesn't)

Serve the community

The real "C" word is "community," not customers. We want our needs met, true, but perhaps the biggest need of all is the desire to belong. To be an "us." It's encoded way deep into our mammalian brains. This point is nicely illuminated by Giovanni Rodriquez . . .

For the past few weeks, I have been struggling with the way people in my tribe — marketing people, PR people, communications consultants — use the word community. There appears to be a lot of interest in creating communities that serve corporate interests, but little desire — or interest, or awareness — in serving the larger community — the world at large. The latter, I believe, is the real opportunity for business leaders in the new, always-on world. Why? Because the frenzy to create corporate communities may only aggravate the problems that communities are trying to solve — the fracturing and atomization of society, information overload, and — as one consultant noted in a presentation yesterday at Community 2.0 — the universal need to “belong.” There’s an opportunity for businesses to become better citizens, not by exploiting the need to belong, but by providing services to people — not customers — in this difficult new world.

At Community 2.0, I moderated a panel with Craig Newmark, whose very presence at the conference — he stood out — helped me to understand this opportunity. Among the many business leaders that showed up to speak and mingle at this conference, Craig was one of the very few that serve Community with a capital “C.” I was reminded that craigslist does not own a community; rather, it serves the community. He may spell his company name (a little c) in lowercase, but it’s a quiet way of expressing his commitment to a very big idea.

The notion of community is central to much of what new media is all about. I think we're barely into the first inning of this game so what this means for this company or that group is still to be seen. It's not an ownable idea, any more than "open source" is an ownable way to develop software. But serving your community, however you define it, is a powerful, authentic thought.

An involved community is a source of competitive advantage

One of the group participants, I think it was someone from Eloqua, said they talked about their user community when they pitched new business . . . as in their involved user community was a source of competitive advantage. Not because the own it or control it, but simply because it's there. The presence of involved customers is surely a sign of a vibrant business. For a new or emerging business, this seems like an especially powerful way to establish credibility and authority.

The brand with the best story wins

The Cluetrain Manifesto didn't say it first, but it said it well: Markets are conversations. For so many marketers, the concept of the brand has been about static ideas about "promise of value" so that we can command price premiums and lower acquisition cost through greater customer loyalty. All good ideas. But there is a wave coming and it's churning off in all that is Web 2.0, and it sounds a lot more like story telling than it does like speech making. Or to put it another way, before we we were all interconnected, before we were our own little intact publishing companies, the brand could control the narrative, or at least act that way secure in the knowledge that the stories being told about the brand by customers wouldn't leak out beyond a couple of hundred people at worst. So in that world, the best story was the story the brand holder told with support from carefully selected spokespeople and proof sources.

Someone asked me the other day when I had my "aha moment" regarding user generated content (dumb term, but whatever). It came mid 2001 when someone sent me a copy of a slide deck called "Your's is a very bad hotel." If you don't know the story (there's that word), the short version is two guys showed up at a DoubleTree hotel late one night secure in the knowledge that they held reservations. Except that when they got there, it turns out that "Night Clerk Mike" had given their rooms to someone else. The slide deck is hilarious. What wasn't so hilarious was that before the storm had subsided, a deck that had been sent to two people had been seen by millions. DoubleTree had to spend hundreds of thousands of dollars on a retraining program. Mike lost his job. The CEO of DoubleTree's parent company had to endure countless phone calls, including some from CEOs of his competitors. The slides were discussed in business schools. It just went on and on.

And this was before anything remotely like "social media" had taken hold. This was just email. And so for a brief period of time, the DoubleTree brand story was out of control. It was being told and retold "out there" by someone else. And because there was no social media to speak of, DoubleTree had no ability to get their voice into the story.

And that's just me. And that's just one story. There are a zillion others. I have more to say on the subject of story telling but I'll save it for another time and place.

Facebook has legs

Everything follows a sign wave and the time will come when Facebook will crest, "jump the shark", or whatever term you want to use for sliding past hot to not. But that point is in the future, and in the meantime, it looks to a lot of us like it has legs. One of the many dynamics driving interest was the company's decision to open up its APIs and make it possible for anyone to build and publish applets for use inside facebook. Brilliant. This combination of tools, user generated content, and community is a potent one. It's an idea we're exploring at DecisionStreet, and one I personally think will be big in the near future. So maybe this point starts out being about a specific platform but is more broadly about content/tools/community.

The people involved in the blogosphere are your most involved customers. Empower with lnking

Big dogs can wait (maybe) but for the rest us, this is your chance

Bill Kircos of Intel made this point and I think it's a good one. It came in response to a question about being a first-mover when it came to jumping into social media. The reality is that few if any big brand holders are likely to go first. Indeed, there are entire industries that won't go first or even second (financial services comes to mind). It is that relative void that creates a terrific opportunity for second and non-tier players to jump in and own an idea (or at least try), set an agenda, participate in the conversatoin, and otherwise make themselves bigger participants than their relative size and resources would otherwise suggest.

Contests are Good

This seems like a small point but it really stood out during a conversation about demand generation. One example is called IdeaBlob which was launched by Advanta, which is a credit card company. Here's the deal.

ideablob.com is where entrepreneurs and small business owners can share and grow their business ideas – and have a chance to win $10,000 towards fulfilling them.

Great ideas are generated every day by people all across the country, and now these ideas have a place to live and grow. Eligible individuals can submit their business idea to ideablob.com, and based on votes from the ideablob.com online community – which includes other innovators as well as friends, family, colleagues, associates, teachers and mentors – one idea every month will win $10,000.

As individuals take part in ideablob.com’s growth, their business has the potential to grow right along with it.

Why ideablob.com? Advanta began in 1951 with an idea, less than $100 in seed money, and big dreams. Today, as a respected company with close to 1,000 employees and well over one million small business customers nationwide, we empathize with entrepreneurs and small businesses and support their growth.

It's not a hugely trafficed site, but it has lots of engaged users and is a great springboard for Advanta.

The second is an Intuit property called Jump up, which is targeted at new and emerging small businesses (not the venture funded kind, the real kind). The contest is called "I resign" and it's for people who quit their jobs to start a new business. As was the case with ideablob, users vote on the submissions.

Let me know what you think

Technorati Tags: Advanta, Bloggers Anthem, DecisionStreet, Frost and Sullivan, Giovanni Rodriguez, Ideablob, JumpUp, Lee Aase, Rick Short, Community 2.0

Frost and Sullivan Keynote: Karen Walker, VP marketing, HP . . . Outsmarting the Competition

Here are my notes on the speech by Karen Walker, VP marketing, HP . . . Outsmarting the Competition At HP, C is the customer word, not cost

• Fortune 14 company
• Simplifying technology experiences around teh world
• 156,000 employees
• 145,000 sales partners
• 70,000 service partners

Strategic Plan Establish HP as the world's leading information technology company HP Strategic Framework

• Invent and develop technology solutions for our customers
• Drive select industry trends. What are the experiences we're creating that are meaningful for the customer.
• Become the best-in-class in the industry

HP operating framework

Targeted growth / Efficiency / Capital Strategy

Creating experiences that customers value . . . while driving key industry trends Customer challenges > Customer experiences > Deliverables

• Always connected mobile experiences. Connecting devices to the network. Connecting users to the services they value.
• Digital imaging and printing. This is a big cost center. How to move from analog to digital. Digital content production and consumption
• Next generation data center. Automated 24x7 lights out computing

Leading with a customer centric mission: (Technology Services Group: To be the best at helping customers managed and transform their IT environment to optimize business outcomes. Commentary: Every word on a slide like this counts. Putting the customer at the front was a big deal for us. We have great brand attributes around trust and integrity. Wanted to make sure the customer got that we were in the boat with the customer. We wanted to recognize that customers were in different stages. We wanted to change the conversation from technology to business outcomes. This last bit is still hard for us. We have a ways to go. Talking customer language and tie-back to business outcomes. Accelerate business growth (from IT to business technology)

• Speed time to market
• Strengthen customer relationships
• Drive revenue and market share

Lower costs

• Reduct IT/Business cost
• Improve operational efficiency
• Improve ROI

Mitigate risks

• Minimize IT/business risk
• Improve compliance
• Improve decision making

Where customers interact with them is their choice. This was hard for us. We got flack on this.

• Customers can buy products and build own solution
• Have HP design, implement, and/or maintain
• Work with value-added partners
• Outsource

Becoming a Customer Company: From > To

• Vertical, functional > work collaboratively and horizontally
• Product and services thinking delivery fragmented > proposition and experience thinking with solutions and personalization
• Operational and transactional thinking focused on productivity and sales > Strategic relationship thinking where the purpose is to create lifetime value for customers
• Category, products, and sales management > Segment, customer and relationship management (this is hard because the funding comes through the business. They want to know what we've done to sell more of their gear)
• Functional and rigid process, structures, systems > Agile, integrated, aligned approach that enables people to work together for customers

We look at the lifetime interaction between a customer and the company. What happens at each touch-point? Lots of win/loss analysis. At every single point we capture data. What's working, what's not. What can we do better? As we do this, our relationship grows. We have metrics out the wazoo. Every sales and marketing person gets paid on TCE metrics. 25%. Total customer experience. How well we're delivering on those experiencing. Customer insight Marketing is charged with giving customer advocate with information to understand customer better than anyone else. We use teams in India and Argentina to crunch the data. Data, Knowledge, Insight.

• Data: Industry growth plans, public filings, customer business, spending, etc.
• Knowledge: Create new knowledge by answering questions, identifying new opportunities; Correlate different pieces of information.
• Insights: Suggest opportunities for TSG based on insights derived from customer knowledge. Conjectures about HP's potential marketing action required to capture those opportunities.

If we can deliver these three to sales organization, we're heroes HP Business Performance Chain

• Employee engagement (attitudes and actions) >
• Process performance (efficiency and effectiveness) >
• Customer experience / satisfaction  (customer loyalty) >
• Customer buying behavior (customer purchase and recommend) >
• Profitable growth (revenue market share)

PSG (personal)

• Employees: Customer first training; reward and recognition; experiential learning and empowerment (Voice of the Workforce; Passion for Customers)
• Op Excellence: Accountable leaders; Strong operational governance and metrics; Process excellence (Operation metrics)
• Customers; Customer data analysis; proactive customer engagements; new customer experiences (customer loyalty)
• Business: Customer experience and quality plans integrated in ASPIRE and PSG scorecard (market share, revenue, gross margin, OPEX)

Questions You mentioned that 25% of pay is tied to customer. We have various levels of surveys to measure sat. Sat; customers gained; partner experience

How do you get your partners to drink the water on this as well? It is challenging. How we select partners is different. They're not all created equally in terms of aggressiveness or delivering customer experience. New criteria but also training and tools. Our partners realize that if they have a trusted and deep relationship customers, goodness flows. So they buy in.

We're doing a linkage analysis on loyalty and outcomes. Key challenges? We knew where the business was and where we wanted it to be. We understood where everyone lined up on those challenges was the first step. Everyone in the organization said it's not us. It's marketing, or product, or sales. So getting the data from the customers was very helpful. Marketing can facilitate, but it's the voice of the customer gets people out of denial.

Some of the best customer insights are from ex customers. Couldn't agree more. From a marketing standpoint we do a win/loss. We've hired outsiders to call the customer (use one in Romania) and find out. We do internal post-mortems internally. That outside view can be harsh, but you need to understand what the customer is thinking. What metrics we use to see if marketing strategy works? We follow similar approach to what Martyn described earlier. How do you do your customer surveys? Internal. External. Blind surveys. We do multiple levels of surveys.

Blogged with Flock

Tags: KarenWalker, HP, Frost and Sullivan

Frost and Sullivan Keynote: Martyn Etherington, VP Global Marketing, Tektronix

Here are my notes on the keynote presentation from Martyn Etherington, VP Global Marketing, Tektronix. If you don't want to read it all, here are my summary thoughts:

• Build tools using Excel. Don't get caught up in the technology.
• Build a front to back model of how the customer buys and align processes and resources against that.
• Align all resources to your go-to-market. Aski: How do we get an A on our report card. Keep asking until you get to the root stuff: real needs.
• Get mathematics. Math and science to create marketing and sales insights.

Have a look at Lee Aase excellent blog on this speech as well.

Here are more detailed notes . . . A recent journal of marketing study of 167 companies concluded that "CMO's of top management teams don't have nay effect on a company's financial performance." Personally, i don't believe that. I don't' think we're communicating well enough. SO why do marketers spend such a large percentage of their time justifying their position and their budgets? I think they have a victim mentality. Why? We lack relevancy with three constituencies:  Customer, Channel, Business. Relevance and facts needed. Lesson 1: If anyone says Matrix Responsibility, run . . . Case study: Transforming the marketing function. The problem.

• Marketing spread across organization
• Over 100 Strategic objectives: 4000+ activities
• Unable to measure anything other than $ spent
• No success criteria, no accountability
• "Looking good" was more important than doing good
• No idea of business situation, order targets, YTD, Funnel size
• Little or no discussion about the most important constituency
• Chasm between sales and marketing. Separate entities no common or shared goals. Critical, skeptical, apathetic, critial and underpinned with pockets of hostility

The Get Well Plan Strategy Alignment

• 100 objectives to 20
• Simple charter
• Defined success criteria

Org Alignment

• Centralized org, budget, responsibilities
• Document roles and resp
• Required behavioral change
• Aligned with sales channels; shared goals

Operational Alignment

• Defined high performance culture
• Measurement and accountability became a mantra
• Hired marketing ops manager
• Monthly reviews

Change our philosophy: Think like a customer. Begin with an understanding of how people buy and their decision stages. Be clear about what is a marketing conversation and what is a sales conversation. Align programs to deciion points and deliver via customer-preferred media. Changed our philosophy from activity based marketing to outcome-based marketing.

1. What outcome are you trying to achieve?
2. What strategic objective doe it support?
3. How will you know when you achieved it?
4. How can you make it better?

Measurement philosophy Took an incremental change approach to measurement Effectiveness Productivity Efficiency Measurement based on peer research and our own needs. Make it more operational vs summarized

• Avoided specific IT investment. All dashboard elements using standard MS tools.
• Uses as an org communication tool to make change
• Summary in 9 box measurement areas.

The Sales Alignment Challenge (great point) What would it take for me and my team to get an "A" on our report card this year. It took 6 months to get an answer. Lots of wants but few needs. What does success look like is a hard conversation. This is why we've been successful because we've facilitated this conversation. We have a contract with sales on what we'll contribute to the business, product lines, and CEO. The lead enigma

• How many leads should marketing provide? 5 leads per AM per month based on #AMs (outcome)
• How much should a marketing lead cost. Marketing Cost per lead should be <$400 (outcome). Bounding condition. These kinds of metrics become bounding conditions for our marketing team. Change the mix to get the outcome.
• Leads outcomes must also support and be aligned to one or more of strategic objectives. Can't be a random lead. Has to link up.

Results and lessons learned Marketing costs have declined absolutely and relatively Marketing productivity has increased absolutely and relatively

• Efficiency and effectiveness
• Now responsible for repositioning and segmentation
• Now started to track customer SOW and NPS
• Measure our business contribution

Strategy / Structure / Operational Alignment must be defined

• Build an accountable marketing function
• Change is hard and will take time
• What you measure gets better; don't measure it if it isn't actionable
• Fact based decision making empowers people
• Always focus on where you are going, you can never go back
• Review and adjust

Questions Measuring lead quality: 80% of all marketing leads go untouched. Poor communications. Missed expectations. The lead aging queue was going up. We spoke to the sales people. It turned out the admins were qualifying them out as garbage so they didn't have to be accountable. So we put them through our telemarketing function. I should have spent more time setting expectations. Now we have a 24 point rating criteria. So now we pass leads when they hit 20 points.

What was the most complex element? 60 years of inertia. I'd run forward and I'd get yanked back. I had to break the rubber band.

Using any sort of application to manage leads? We have semi-automated. We have a data mart. A lot of manual intervention. Just started using SFA. We did the hard work first around process and alignment.

You said you replaced 2/3 people: It was skills and attitude. This was over 5 years. We had some cancer cells. Misfits. At one point we were the dumping ground for everyone's misfits. Now we're the recruiting ground for others.

Leads coming from India vs. 5 years ago and what kinds of adjustments are you making now that you're marketing in Asia?  The region in general vs. the west, the demographics are very different. In Asia engineers are younger and the concern is growth. In the west, older and the issue is job security. They all see themselves as problem solvers. That psychographic makes it easier. Number 1 is internet. 2 is word of mouth. 3 is content in the press. Advertising is way down on the list. Our audience is anti-marketing. Biggest area on our web is documentation.

There is a relationship between sales and marketing. How did you chisel away the wall. It's organic. We put my team on variable comp plan. Variable 20% tied to the business. Communication and relevancy in terms of going out and defining what success looks like. Made a contract. Put it on the wall. We tried to learn. Tried to be on a peer level. Not victims. Not a service bureau. It takes a long time to turn it around.

What about the other functional areas like IT?  With the CEO and CFO, the issue is what we contribute to the business. All of a sudden you get a fan. I had great air cover from the CEO. IT. I would say we have the least working relationship with IT. Everything was "two years and two million dollars." That's why we decided to do manual labor. Now they've started to come around. Now the CEO is keen to get them onside.    

 

 

Blogged with Flock

Tags: Frostand Sullivan, Tektronix, CMO, Marketing, Sales Alignment,  

More from Frost and Sullivan: Using Social Media to Drive Demand

Managing speed. The folks from TD Bank say: We’re a marketing department of a big international bank. How do we put ourselves on a big network and keep ourselves up to date. Measure it six months later and pat ourselves on the back. But it doesn’t go away.

   

Another. How do you drive creative ideas around that content. Something that’s not necessarily branded all over the place. Almost like a third party or expert writing. Sometimes we talk to ourselves. Customers don’t want to near that.

   

From Armstrong: One of the things companies struggle with is how to create content the customer cares about. You have to start with a lot of ideas. You need to have a depth of ideas to start.

   

Many people had some energy around this: You need a strategy to accept criticism and negativity and do something with it.

   

Question: How many people allows unfettered comments? Most people do. At HP: Some editing for profanity and spam. Comment from Michael from Techdirt: That seems impressive. That’s changed.

   

Question: How do you deal with the negative comments when you get them? They’re out there. Whoever owns the blog is responsible for responding. You can’t respond like you would a press release. It has to sound like a conversation. You can’t be afraid to either say you’re sorry or to disagree. From TD Bank: If it’s a customer forum, we don’t respond. It’s their forum. But we do analyze it and house it. A question about that. If a customer raises a legitimate complaint, what do you do? It’s not the place to do that. Perhaps let them know in another way?

   

How many people are tracking what’s getting said out there in the blogosphere? Less than half. Indium has indigenous language people monitoring blogs in language (a very technical product). We use RSS. Or use google or technorati. If it’s in the mainstream, we find it.

   

Izea is a pretty visible company on the internet. The CEO spends time at the beginning and end of the day commenting on what’s being said. Either thanking people or offering other insights.

   

A point: At some point you have to track this to real dollars. Specifically the issue is marketing metrics. Early on people were talking about these as

Greenfield

things. You have to be out there. Now we have to justify it.   

What about people on social networks. TD is on Facebook as is RBC. A Canadian network. All pitched to young people. The money lounge. It’s for financial literacy, coupons, people with needs. People use it for Frosh week. We’ do lots of trinkets and trash. Hosting where people can post comments about us. Half negative and half positive. Most of the problem is . . . we have several thousand people on it . . . making it a fresh. A reason to return. We have some widgets on the site. Once they’ve used that, why come back? How do we give people a reason to come back?

   

Question: Do you (TD) have a strategy to move people up to a next level of involvement. The next step is where the money is. A big discussion in the room . . . people don’t see them growing up or graduating to something else. Or to put it another way, will the millennium generation ever graduate from social interactions to brand-centric interactions. Rick Short and Lee Aase were loud on “no” (as was I).

   

For retailers like Armstrong . . . the design process might change. The customization of the product. What will change and how will we deal with that. Our mentality isn’t to let the customer be in control. We’re just not set up to do that. We wanted to do something like this on myspace. The marketing people killed it. This is a game changing thought process.

  In a break out, one of the cool ideas that Mayo Clinic is doing is podcasts which re-purpose content that they've generated on the way to creating television commercials (interviews with Docs). An idea that I'll take credit for . . . why not make it super easy for bloggers to grab and include some of Mayo's very cool calculators like this one . . . Another recommendation is to do expert blogging.  Yet another idea, and this one comes up in other connections, is the power of a non-branded microsite. Mayo is using voxant to syndicate video content. It's like youtube but it gives you much more control. Given that there are already three properties, the idea of linking off to facebook creates some anxiety. The idea of sending someone away from the patient site to talk over there isn't a no-brainer (whereas driving traffic from there to here is). Anne at Publicis Modem suggests that it's not an either/or. Some communities may prefer to talk in one place but not another . . . like facebook. It's so much easier to find people like you. From another breakout for US Bank: Leverage blogs that are out there rather than starting from scratch. Create a badge that allows people to save money towards something they want. Many people have badges for "buy me a beer." How about something more useful and maybe even sign up customers. Or how about searching for topics on blogs you like and buying ads in context. Another. They have lots of small business customers. They're already coming to the website. What other things can they do to leverage the relationship. Bring that community together. They have a lot in common. The insatiable appetite small business owners have for information. From a breakout for Pfizer. They have an advantage in that they have people who self-organize into communities and they have the leading drug (or one of). So one idea we had was non-branded sites where patients can independently recount their experiences. Make it a destination site: guest bloggers, cooking demonstrations, etc. Mine the concerns that people have about taking drugs.  The biggest difficulty here may be the aging demographic (less web centric?). If you could get doctors into community, there could be an opportunity to create pull for information vs. chasing them for a two-minute meeting. The biggest issue drug companies have right now is compliance . . . encouraging patients to keep taking their drugs. A huge opportunity (financial and health). From a breakout for Armstrong: Find a way to leverage the blogs and social networks to drive more customers to our site and adoption of the product. Dos

• Be relevant to the space you're in
• Find communities that have a common interest (like DIY)
• Provide added value: widgets, calculators, something more than just being a friend.
• Find pseudo celebrity experts. Enroll them. Let them have their own voice so that it's authentic.
• Build a database. Who these folks are and build relationship marketing upfront.
• Partner with other people in the process (like painting or furniture). We have a site called designmyroom that does this.
• Be bold

Don'ts

• Don't spend a lot of money building an application. There's tons out there.
• Don't make it harder than it needs to be.

Read Lee Aase blog post for more on this session.

Blogged with Flock

Tags: Frostand Sullivan, HP, TD Financial Group, Armstrong, Izea, Technorati, Mayo Clinic, Rick Short, Lee Aase, voxant, Publics Modem, Pfizer, US Bank, designmyroom

Selling Value. Notes from Frost and Sullivan Conference

Here are my notes on a speech I heard today at a Frost and Sullivan conference. Obviously they make more sense if you were there, but now they're here. Some good stuff here.

      

Textron: Growth, Customers, Profitability by Siisi Adu-Gyamfi

   

Companies struggle with this topic. How to grow both topline and bottom line.

   

The answer: You have to understand where your customers are. The value exchange. People try to grow at the expense of someone else. Like GM squeezing their suppliers. We have to give our customers what they need to be profitable. We give them something, they give us something. If any player breaks the cycle, you fail.

   

Everyone talks about value. What is it? Value from the latin, valere, to be worth. That which is good or desirable, or the result of owning something that is good or desirable. Doing something to help them to become more profitable. Are the products or services you give your customers helping them be more profitable?

   

Three steps to create balance of profit and growth.

   

1. You must understand the customer. On the average, companies think they know their customer. Give themselves an 8 out of 10. Most don’t.

   

Find the root need. Driven by their goal. It changes as the goals change. Purpose. If a supplier can satisfy a root need, its value is likely to be recognized. Increase Revenue, Reduce costs, or reduce investments. Only those three things.

   

Understand the customer’s industry. What is the business their in. Industry pain points. Forward-looking, proactive decision making to address customer issues. Are you in a position, nor or in the future, to assist customer issues? Is it aan attractive industry to build or maintain a presence?  Porter analysis.

   

Value System / Value Chain. Evaluate areas where value is added or not added. Find how you can help customers lower total cost.

   

Customer analysis: Financial Performance: Comparative Analysis. Trend Analysis. Five key financial ratios. Liquidity, Solvency, Asset Management, Profitability, ROI.

   

Buying Behaviors. Every customer has a buying behavior. Observable actions that describe how a customer conducts business with its suppliers. Here are the behaviors . . .

   

1. Supply Base
2. New Tech Acceptance
3. Relationship Preference
4. Order Specification
5. Buyer Loyalty
6. Decision Making Authority
7. Buying Center
8. Purchase types
9. Purchase frequency
10. Buying Decision
11. Desired Service Level

                        

Each of these behaviors has a scale: from low to high something.

Buying Factors. What they want to see. Technical (what it does and how it does it), economic (terms of purchase), and enterprise (supplier performance).

   

Put them all together to create a holistic view of customer’s current operational state

   

2. Put together an offer. If it doesn’t create value for the customer, it’s not an offer.

   

Explain how it creates value. Satisfy needs. Frame in customer’s terms. Quantified benefit.

   

Three types of benefit. Financial benefit. Relationship benefits. Process benefits.

   

Process benefits: Increase or improves customer’s business processes. On time Delivery, inventory reduction, increased throughput, etc.

Relationship benefits. Improves working partnership between customer and supplier.

   

Benefits to quantification of benefits to increased customer value. Show the math.

   

What they buy from you is the tip of the iceberg. Underneath are all the costs they pay, all the investments they have to make, all the revenue they don’t get.

   

3. Customer Discussions. Show them you have something that can help. Compares to closest alternatives. Total economic value is the reference value. All the stuff you can do that they can’t. All the stuff they can do you can’t. That gives you total reference value. Show each of the values on a waterfall chart.

   

Get them to describe how they do something. Find the metrics they care about. Conceive of a solution (level 2) or propose an entirely different way of looking at the problem (level 3)

       

Questions

   

1. Do you start with the customer or the idea or both? You can do it either way.
2. What kind of resources does it take to develop a detailed financial analysis? Walmart has smart people. It took three people four and a half months to do this type of analysis.
3. In your examples, what kind of extra costs have vs. your competitor. The overall costs were about 5% over our competitors but the margin was huge.
4. You were talking about examples of customers with pain points. What about markets where customers don’t know they have pain points. It doesn’t keep them up at night. Interesting. A lot of companies don’t think they have any pain points. They think life is good. You have to educate the customer with data. Once they start to think about it . . .
5. How do you calculate the reference value? What your nearest competitor sells for. Then look for what they can do and can’t do and plus and minus it vs. your offer.
6. One of the things we struggled with was the believability of the data. So we asked the customer to provide the data/drivers.

Here is Lee Aase excellent blog notes on this talk.

                     

Blogged with Flock

Tags: Frostand Sullivan, value, value selling

The Problem With Brilliant Men

My son sent me a link to a blog that quotes entirely an article that presumably was written in the 20s about the danger of hiring "brilliant men." I haven't bothered to trace the provenance of the article but I found it a bracing read. The section I've clipped comes from the end . . . you'll have to read the whole thing to find out the problem, here is the antidote . . .

SIR ISSAC NEWTON sat one night at dinner beside a very attractive and voluble young lady."My dear Sir Isaac," she exclaimed, "how did you ever happen to discover the law of graviation?"

"By constantly thinking about it, madam," her "dear Sir Isaac" muttered.In that blunt answer lies the substance of my experience, and what I believe to be the real secret of business achievement.

So sure am I of the soundness of this philosophy that I have five very simple rules for hiring men, which are the outgrowth of it!

1. Has he good health? Some months ago a newspaper collected from a hundred young men a list of the qualifications they would seek in the girls they hoped to marry. The list differed widely, as may be imagined. But at the top of almost every one was written the asset which I put first in men -- good health. Without it the best man in the world is likely to become pessimistic in his outlook, and to break when he is needed most. With it, even mediocrity can force itself by unusual effort into something fine and useful. Generally speaking, I would rather have a man who was born frail, and has overcome his frailty by careful living, than take one whose natural strength has never known its limits. The athlete, like the genius, frequently disappoints; while the man who has had to fight for his health knows how to value and preserve it.

2. Has he saved some money? I don't care how much, or how little, but he must have saved something. At times, this demand may seem harsh. A man will say, "I have had parents to look after," or "I have had bad luck with an investment," or, "I trusted a friend who failed me." To all such excuses I am sympathetic, but I do not relent. I answer, "That is too bad, but think what it means. You have lived twenty-five or thirty years without making a profit on your life; how can I expect that you will be a profit-maker for me?"

3. Does he talk and write effectively? This may seem a strange requirement, but it has been a very useful one. If we could unscrew the top of men's heads and look in, many of our problems would be eliminated, for we could see what sort of thinking goes on there. Lacking that privilege however, we have to judge by what comes out of the mind through the tongue and fingers. If a man writes and speaks "neatly" it is because his thinking is orderly; if his expression is forceful, the thought back of it must be forceful. But if he blunders for words, and uses phrases which express his meaning clumsily, I believe his mind is cluttered and ill-disciplined.

4. Does he finish what he starts? Geniuses almost never do. I look very critically into little things respecting the men I hire; the details of their dress, their handwriting, their record of tying up a job and leaving no loose ends. The biggest men of my acquaintance in business are "detail men" to an amazing degree. Often the president of a company is the only man in it who knows the little things about every department.

5. Finally, of course, I look for courage. General Grant was a rather slow-witted man, and a failure in middle life. But he won the Civil War; and the principle on which he proceeded was that the enemy was probably just as much scared as he was. Napoleon's motto was "When in doubt, attack." I like to throw something rather hard at a young man, and see how squarely he meets it. For with courage and the habit of going forward he can travel a long way. He will pass many men more brilliant than he is. Their active minds can always see two sides to every question; and they stand still while the debate goes on inside.

taoyue.com: Why I Never Hire Brilliant Men

Blogged with Flock

Tags: BrilliantMen

A Few Good Salesmen

My brother sent this to me. Love it all day long . . .

Sales: "You want answers?"

Finance: "I think we are entitled to them!"

Sales: "You want answers?!"

Finance: "I want the truth!"

Sales: "You can't handle the truth!!!"

"Son, we live in a world that requires revenue. And that revenue must be brought in by people with skills.

Who's going to find it? You, Mr. Finance? You, Mr. Operations? We have a greater responsibility than you can possibly fathom.

You scoff at the sales division and you curse our incentives.

You have that luxury. You have the luxury of not knowing what we know:

That while the cost of business results are excessive, it drives revenue. And my very existence, while grotesque and incomprehensible to you, Drives REVENUE! You don't want to know the truth because deep down in places you don't talk about at staff meetings ... you want me on that call. You NEED me on that call!

We use words like upgrades, another round, top-shelf, medium-rare, charge it, and foursome. We use these words as the backbone of a life spent negotiating something.

You use them as a punch line!

I have neither the time nor the inclination to explain myself to people who rise and sleep under the very blanket of revenue I provide and then question the manner in which I provide it. I would rather you just said "thank you" and went on your way.

Otherwise I suggest you pick up a phone and make some calls. Either way, I don't give a damn what you think you're entitled to!"

Finance: "Did you expense the lap dances?"

Sales: "I did the job I was hired to do."

Finance: "Did you expense the lap dances?!"

Sales: "You're goddamn right I did!!!"

Apparently this was written by one of the guys at The Philadelphia Group but i can't say for sure.

Technorati Tags: Sales, Selling

Does Sarbanes Really Need Fixing?

Ask 1000 Americans about Sarbanes-Oxley and 999 won't have the first clue what you're talking about. So with that as a backdrop, I doubt that any of the 999 could tell you on a bet who Henry Paulson is and why the misnamed Paulson Committee is highly likely to further separate the interests of the small investor from the captains of industry who look after the companies they invest in.

[nyt] Now that corruption cases like Enron and WorldCom are falling out of the news, two influential industry groups with close ties to administration officials are hoping to swing the regulatory pendulum in the opposite direction. The groups are drafting proposals to provide broad new protections to corporations and accounting firms from criminal cases brought by federal and state prosecutors as well as a stronger shield against civil lawsuits from investors.

Although the details are still being worked out, the groups’ proposals aim to limit the liability of accounting firms for the work they do on behalf of clients, to force prosecutors to target individual wrongdoers rather than entire companies, and to scale back shareholder lawsuits.

The groups hope to reduce what they see as some burdens imposed by the Sarbanes-Oxley Act, landmark post-Enron legislation adopted in 2002. The law, which placed significant new auditing and governance requirements on companies, gave broad discretion for interpretation to the Securities and Exchange Commission. The groups are also interested in rolling back rules and policies that have been on the books for decades.

And just so you don't miss it, this is the important part

To alleviate concerns that the new Congress may not adopt the proposals — regardless of which party holds power in the legislative branch next year — many are being tailored so that they could be adopted through rulemaking by the S.E.C. and enforcement policy changes at the Justice Department.

There are two blue ribbon committees looking into this vexing issue. The first was formed by the US Chamber of Commerce and headed by Robert K Steel. It probably won't surprise you to know that he was just sworn in as the new Treasury undersecretary for domestic finance. He will be the person in the department in charge of formulating the Treasury’s views on the issues being studied by the two groups.

The other group, sometimes called the Paulson Committee was formed by a couple of heavy weights whose views are already well know.

The second committee was formed by the Harvard Law professor Hal S. Scott, along with R. Glenn Hubbard, a former chairman of the Council of Economic Advisers for President Bush, and John L. Thornton, a former president of Goldman Sachs, where he worked with Treasury Secretary Henry M. Paulson Jr.

That group has colloquially become known around Washington as the Paulson Committee because the relatively new Treasury secretary issued an encouraging statement when it was formed last month. But administration officials said Friday that he was not playing a role in the group’s deliberations.

Its members include Donald L. Evans, a former commerce secretary who remains a close friend of President Bush; Samuel A. DiPiazza Jr., chief executive of PricewaterhouseCoopers, the accounting giant; Robert R. Glauber, former chairman and chief executive of the National Association of Securities Dealers, the private group that oversees the securities industry; and the chief executives of DuPont, Office Depot and the CIT Group.

If you're having a hard time finding the names of a consumer advocate or anyone without a vested interest in loosening things up around the boardroom that's because there aren't any.

Sarbanes is a big deal to be sure. In some ways its requirements are pretty onerous and there is a case to be made for adjusting it here and there. It is also one of the reasons cited as to why large flotations are increasingly showing up on the London Exchange, or even Hong Kong, vs. New York. Given a choice--and there are now choices--why list where you have SOX to contend with if you can avoid it. But there are competing interests here . . . like your's and mine. As Ben Stein points out . . .

Basically, they are going to try to get private securities cases to be virtually closed down, in favor of having cases only from the Securities and Exchange Commission [notorious for how little regulation and investigation it actually does].

Don’t get me wrong. Powerful people have studies that prove their points, and then they lobby Congress, federal regulators and state legislatures to get what they want. This is how the world works. This is called working the system, dealing with the world as it really is. But is it really right for prominent American executives, amid a host of scandals involving other executives looting their shareholders blind, to have the best and the brightest of academe and the Street lobbying for less accountability to shareholders?

Is there any higher goal at all for management than serving the stockholders openly and honestly? Is “competitiveness” even a meaningful word, compared with honesty and integrity in serving the owners of the company? What can “competitive” mean in this context? Would a hospital be more “competitive” if it didn’t have to take care not to kill its patients when it operated on them?

Global competitiveness is a good thing, but not the only thing. The one thing you can absolutely say for it is that it makes for shareholder value: either the company succeeds and makes money for its investors, or it doesn't, in which case it gets bought (hopefully making money for its investors) or goes away. It also means a constant bleeding of US jobs (big businesses in this country are net destroyers of jobs year after year), incomes, and communites. If the Bush administration is going to let big companies offload pension and health care obligations while seeking ways to insulate the captains of commerce from shareholder responsibility, what else is left?

Technorati Tags: Henry Paulson, Lou Dobbs, Sarbanes-Oxley, SOX, SEC, US Chamber of Commerce