distinct or … extinct: tom peters seminar2000 cincinnati 05 june 2000
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Distinct or … Extinct: Tom Peters Seminar2000
Cincinnati05 June 2000
Defeated Before The Starter’s Gun!
“Track 4: Managing Organization Change (Helping
Tired and Overworked Professionals with Today’s
Workplace Realities)”
NAPM: “You are the
Rock Stars of the
B2B Age!”
Pentium III 800MHz: $42,893.00/#Hermes Scarf: $1,964.29
Saving Private Ryan on DVD: $874.75Mercedes-Benz: $18.98Hot-rolled steel: $0.19
Source: Fortune (3.20.00)
“Researchers say they have found a way to mate human cells with circuitry in a ‘bionic chip’ … The tiny device – smaller and thinner
than a strand of hair – combines a healthy human cell with an electronic circuitry chip.”
AP/AOL/02-00
An Age of Passion:1 Year = 1.5 Wal*Marts
03.27.99: $167B03.27.00: $555B
P.S.: Wal*Mart = #8 in 2000
No Wiggle Room!
“Incrementalism is innovation’s worst
enemy.” Nicholas Negroponte
Just Say No …
“I don’t intend to be known as the ‘King of the
Tinkerers.’ ”CEO, large financial services company
(New York, 5-99)
64/24
Goal?
Welcome to the Land of the True Believers!
“We have the ability to turn the economy upside down, to enhance lives, and to drive
civilization forward.”
Michael Saylor,MicroStrategy
“It means nothing less than the total
reinvention of this company.”
Jacques’ New New Ford
Ford + MSN CarPointFord + Yahoo!Ford + Oracle
Ford + HP/MCIWorldcomEtc.Etc.
“We are in a
brawl with no rules.”
Paul Allaire
S.A.V.
T.T.D.sThe next slide is the first of many
“T.T.D.” activities. I.e.: Things To Do. These are by and large shorthand forms of training exercises I use.
Also: Most of these T.T.D. slideshave accompanying Notes.
(See following slide.)Tom Peters
T.T.D./True or False:
“incrementalism”
VERSUS
“innovation”?
Notes Page• This is a daunting issue. There is no “right answer.”
But it merits constant, conscious debate. Consider the value of incremental change. [Kaizen, etc.] And discuss whether or not this thwarts “BIG” initiatives aimed at wholesale reinvention.
• Also: Consider … “Can we do both?” [I’m not sure.] P.S.: This crucial issue holds for Finance Departments as much as Product Divisions. And it holds for the smallest and newest of businesses! THIS DEBATE IS WORTH LOTS OF TIME! KEEP IT PRACTICAL!
Tom Peters Seminar2000
Brand Everything:Distinct or Extinct!
Part I: Brand InsidePart II: Brand Outside
Part III: Brand Leadership
Forces @ Work I
The Destruction Imperative!
Forget > Learn
“The problem is never how to get new, innovative thoughts into your mind, but how to get old ones out.”
Dee Hock
“It is generally much easier to kill an
organization than change it
substantially.” Kevin Kelly, Out of Control
“When asked to name just one big merger that had lived up to
expectations, Leon Cooperman, former cochairman of Goldman
Sachs’ Investment Policy Committee, answered: ‘I’m sure there are success stories out there, but at this moment I
draw a blank.’ ”
Mark Sirower, The Synergy Trap
“Talent” and a $2T enterprise??????
“Acquisitions are about buying market share. Our challenge is to create markets. There is a big difference.”
Peter Job, CEO, Reuters
“Our ideal acquisition is a small startup that has a great technology product on the drawing board that is going to come out in six to twelve months. We buy the engineers and the next generation product. …” John Chambers, Cisco
Enron (per Gary Hamel/Fortune/06.00)
Design an open market for ideasOffer an open market for capital
Open up the market for talentMake like a cell: Divide and divide
(“We haven’t been able tostart new businesses within existing businesses”)
Pay your innovators well – really well
Dept. Head I = Sports G.M.
Dept. Head II = V.C.
G.M. = The Recruitment and Development of Top Talent.
[Period!]
V.C. = Bets on “Talent.” Bets on Projects. [Period!]
Silicon Valley Success Secrets
“Pursuit of risk”: 4 of 20 in V.C. portfolio go bust; 6 lose money; 6
do okay; 3 do well; 1 hits the jackpot
Source: The Economist
“R & D”
Intel’s venture fund: 275 investments, $8B
Source: Fast Company , eCompany
Net World!
Act now. Analyze later.
Avram Miller
[TP to Chain Owner …
“Do 5 deals before you go home!”]
“It used to be that the big
ate the small. Now the fast eat the slow.”Geoff Yang, IVP/ (Institutional
Venture Partners)
E.g.: Craig Venter/Celera Genomics
C.E.O. to
C.D.O.
The Gales of Creative Destruction
+29M = -44M + 73M
+4M = +4M - 0M
Paradox Redux
Atlanta: +113,600 = #1 metro area
Layoffs [major]: BellSouth, Lockheed, Coca-Cola
Brand Inside
Brand Org: Lean, Mean, Linked &
Electronic
108 X 5vs.
8 X 1*
* 540 vs. 8
And Now the Equivalent …
White Collar Revolution!
Cemex and FDX!
The Pincer 5
“Destructive” entrepreneurs/ Global Competition
“White Collar Robots”
THE INTERNET! [E.g.: GM + Ford + DaimlerChrysler]
Global Outsourcing [E.g.: India, Mexico]
Speed!!
RR on “Assetless” [J.B.] Sara Lee
“The most profitable businesses in the future will act as knowledge brokers, linking insights into what’s available
with insights into the customer’s individual needs
and preferences.”
The “&-!!+#$% in the middle”*
Jim Clark on Healtheon/WebMD
* ’twixt docs, patients, insurers and providers; $275B of $400B in waste; source: Michael
Lewis, The New New Thing
[ Incidentally …
CEO Jeff ArnoldAge: 30
First Start-up: Age 24]
“This is the Age of Ageism: The real innovator’s dilemma isn’t ‘disruptive technologies;’ it’s
the relentless rise of the quasi-adolescents who wield them.”
Michael Schrage (06.00/Fortune)
“The Triumph of the Brainiac: In today’s biotech,
dot-com world, nerds rule, and it all starts in
high school”
Cover story, The New York Times Magazine (06.04.00)
“We want to be the air traffic controllers
of electrons.”Bob Nardelli,
GE Power Systems
So does Enron![et al.]
[Water2Water.com]
Buzzsaw.com
Builders, Owners, Architects, Contractors, Suppliers
$4T industry
5,300 commercial bldg. projects’ specs on-line; +70 per day
And …
e-Builder.com, BuildNet.com,
EqualFooting.com [et al.]
12/31/00 (per Newsweek 04.24.00)
75% of U.S. universities will have on-line offerings/ 5.8 million students
“Unbundling” profs’ jobs (star lecturer, facilitator)/ Repackage “content”
as multi-media “event”
AAUP is angry! (Good news!)
355 studies: Equal results! (and one teachers union study
that disagrees!)
“The e-conomy is one of re-intermediation, where new
technologies make it possible to radically increase complexity and
efficiency with the introduction of new marketplaces. In these markets, value
chains constantly reorganize as the demands of the consumer and
business change.”Thomas Koulopoulos, Delphi Group
These are …
L.A.D.T.I.R.S.*
*Life-and-death-total-industry-reinvention-struggles
T.T.D.
Does your vision involve a critical position in the
industry’s Spider’s Web?
Notes Page
• Try to depict your industry … or your department … with all its interconnections. E.g.: What if every task you perform became a “for profit” task in which you became an “industry expert”? E.g.: As an HR Dept. in the utility industry, what if you started the premier dot.com industry Talent Bank?
The Cluetrain Manifesto
Magic!
[Inter]networked Markets
meet …
[Intra]networked Workers
Source: The Cluetrain Manifesto: The End of Business as Usual
“Hyperlinks subvert hierarchy!”
The Cluetrain Manifesto
“E-business is the final nail in the coffin
for bureaucracy at GE.”
Jack Welch/GE Annual Report 2000
Corporate Resistance to “It”
“It all goes back to fear of losing control!”
The Cluetrain Manifesto
[ Words to Live By …
“Hierarchy is an organization with its face
toward the CEO and its ass toward the customer.”
Kjell Nordstrom and Jonas Ridderstrale, Funky Business]
Brand Inside
Brand Work!
So what will be the Basic Building Block of the
New Org Unit?
Why are there no books on how to create
a “Cool, Rocking, WOW-producing
Finance Department”?
You are the Rock Stars
of the B2B Age!
[NAPM Redux: Welcome to the Y2K New Orleans
Jazz and Real Cool Purchasing Dudes
Festival!]
NAPM: Not “Purchasing”!NAPM: Not “Supply Chain Mgt.”
NAPM = TE/IR!*
*Total Enterprise/Industry
Reinvention!
Message to NAPM: You are
Re-invention Evangelists!
“support function” / “cost center” / “bureaucratic
drag”
or …
“Rock Stars of the ‘Age of Talent’ ”
’tude dude!
PSF 1.0
Department Head
to …
Managing Partner, HR [IS, etc.] Inc.
Every job done in W.C.W. is also done
“outside” … for profit!
Credo
“WORK WORTH
PAYING FOR”
PSF 1.0
Professional Service Firm Conversion Kit /
Release 1.0
The “7Ps” of PSF 1.0
Projects!Passion!
Provocation!Partnership!
Politics!Professionalism!
Performance!
C.I.O. to
C.E.F.R.N.S.*
*Chief Evangelist For
Really Neat Stuff
T.T.D.
Compare: “Department Head” versus
“Managing Partner, Finance Inc.”
Notes Page
• See our book, the Professional Service Firm50, re the differences between a traditional “Dept.” and a full-fledged “PSF.” Our “The Work Matters” manifesto – at tompeters.com – also covers this.
“How long does ‘culture change’
take?”
What Do I “Do” First?
One Minute Excellence!*
*Thomas Watson
Culture Change is not “Corporate.”Culture Change is not a “Program.”
Culture change does not take “Years.”Culture Change does not start “Today.”
Culture Change starts Right Now!Culture Change
Lives in the Moment!Culture Change is
Entirely in Your Hands!
“Reward excellent failures. Punish
mediocre successes.”
Phil Daniels, Sydney exec
But Does It Matter ????
“On time, on budget … who cares?”
anon. seminar participant (4/99)
“You really got to me. So many of our information technology projects take on a life of their own, and I know they’ll never end up as more than ‘mediocre successes.’ ”
CEO, F100 financial services company (10-98)
WOW Project Anatomy
I. Create!II. Sell!
III. Implement! IV. Exit!
Create/Reframers’ Rules:
Rule 1: Never accept an assignment as given!
Rule 2: You’re never so powerful as when you are “powerless”!Rule 3: Every “small” project contains the entire enterprise
DNA!
Measures
–WOW!–Beauty!–Raving Fans!–Impact!
“Every project we take on starts with a question:
How can we do what’s never been done
before?”Stuart Hornery, CEO, Lend Lease
WOW Project “Acid Test”
Can you explain it - with zest -
to your 14-year-old?
Sell, Sell, Sell!
Master “The Pitch”!
Repeat: “I am a salesperson!”
Implement/Culture of Prototyping
“Effective prototyping may be the most valuable core
competence an innovative organization can hope to
have.”
Michael Schrage
“You can’t be a serious innovator unless and until you are ready,
willing and able to seriously play. ‘Serious play’ is not an oxymoron;
it is the essence of innovation.”
Michael Schrage, Serious Play
T.T.D./ Prototyper’s LawsDefine a small, practical test of something on a
page or less of text. Now.
Gather “found” materials … on the [very] cheap.
Find a/one partner-“customer” who’ll provide a test site.
Set a very tight deadline of about 5 days for the next concrete step.
Conduct the test! Debrief A.S.A.P.
Set the next test date. Now. [No more than 5 days hence.]
Notes Page
• The idea is to establish a “rhythm of prototyping” that defines every project.
T.T.D./ Secret No. 1: Forget “selling up”! Go horizontal: Find a (one!) “line” ally in “the Boonies”!
Secret No. 2: “Powerless” allies are Cool!Secret No. 3: Become a Prototyping
Maniac! Secret No. 4: Embrace Politics /
“Community Organizing”! Secret No. 5: Passion Rules! Get your
story in shape!
Notes Page
• Main Idea: YOU ARE NOT “POWERLESS.” Seek out allies in strange places … and get going! DO NOT WASTE TIME “SELLING UP.”
• Attitude: You are the Gandhi/King of your “mission.”
• So: IDENTIFY THE FOLKS YOU WANT TO PLAY WITH RE THAT INCREDIBLY COOL IDEA YOU HAVE!
K2K!
Pause …
Implementation 101
Mark McCormack: 5,000 miles for a 5
min. meeting.
ESP to TJP: DON’T FORGET YOUR
THANK YOU NOTES!
“It was much later that I realized Dad’s secret. He gained respect by giving it. He talked and listened to the fourth-
grade kids in Spring Valley who shined shoes the same way he talked and listened to a bishop or a college
president. He was seriously interested in who you were and what you had to
say.”
Sara Lawrence-Lightfoot, Respect
“The deepest human need is
the ... NEED TO BE APPRECIATED.”
William James
Connection!
2 folks in Hartford …
SOOOO … HOW MANY OF YOUR COLLEAGUES ARE
“BACK HOME” AT WORK ON NO-BALONEY …
WOW* PROJECTS!
* WOW = Will be remembered fondly/
bragged about 5+ years from now
Epitaph from Hell …
Joe T. Jones
1942 - 2000
HE WOULDA DONE SOME
REALLY COOL STUFF
BUT …
HIS BOSS WOULDN’T LET HIM!
Characteristics of the “Also Rans”
“minimize risk” “respect the chain of command” “support the boss” “make budget”
Source: Fortune on “most admired global corporations” (10/26/98)
The greatest dangerfor most of us
is not that our aim istoo high
and we miss it,but that it is
too lowand we reach it.
Michelangelo
T.T.D.: Now!– List all projects– Carefully describe a “WOW Outcome” for you
and the Client– Score (!) all projects on WOW, Beauty, Impact,
Raving Fan-hood– Pick one project with a high combined score– Draft a one-page New Description that
emphasizes WOW, Beauty, etc.– Circulate and edit … for three days – Reduce to 5 bullet points
Notes Page
•DO IT! •NOW!
[We are not trying to “WOW you up.”
We think you are/have WOW.
We are trying to give you permission to be WOW.]
1) Turn ignition key.2) Shift into drive.
3) Press foot firmly on the throat of mediocrity.
Source: Mercedes ad
Brand Inside
Brand You: Distinct …
or Extinct
DISTINCT … OR EXTINCT!
“If there is nothing very special about your work, no matter how hard you apply yourself, you won’t get noticed and that increasingly means you won’t get paid much, either.”
Michael Goldhaber, Wired
“If one quarter can’t make the journey, that’s the way it
has to be.”
Carly Fiorina (1-00/Forbes)
Promotion on Seniority?
Artists?Violinists?
Chefs?Ballplayers?
Personal “Brand Equity” Evaluation– I am known for [2 to 3 things]; next year at this time I’ll
also be known for [1 more thing].– My current Project is challenging me …– New things I’ve learned in the last 90 days include …– My public “recognition program”
consists of …– Additions to my Rolodex in the last 90 days include …
–My resume is discernibly different from last year’s at this time …
Resume=
Your Annual Report*
*New York Times Magazine [05.14]
Ike’s World Book Page
And Yours?
T.T.D./Assignment
Construct a 1/8-page or 1/4-page ad for
Brand You … for the Yellow Pages
Notes Page
•THIS IS A BIG DEAL. TAKE IT SERIOUSLY. [“Yellow Pages ads” are the centerpiece of our formal Brand You training programs.]
“You are the storyteller of your own life, and you
can create your own legend or not.”
Isabel Allende
[ T.T.D.: How About It?
Replace your current evaluation process with
Yellow Pages ads.]
Notes Page
• NO BULL! Some of our Clients have gone this far. And report stunning results. If you can’t do this formally, try it informally.
R.D.A.
Rate: 15%?, 25%?
Therefore: Formal “Investment
Strategy”/R.I.P.
T.T.D./Your R.I.P.
IS IT … FORMAL? IS IT ... WOW!?
Notes Page
• We think “R.I.P.s” are imperative! So … please take these two questions seriously and literally!
T.T.D./R.I.P.
Use by yourself.Use with your mates.
Use [quantitatively?] as a measure of departmental/
P.S.F. renewal.
Use in formal eval process.
Notes Page
• The whole idea is to make “R.I.P.s” a/the centerpiece – formally – of measuring unit “freshness.” E.g.: SCORE EVERYONE’S “R.I.P.” ON ITS BOLDNESS/WOW.
“You must realize that how you invest your human capital matters as much as how you
invest your financial capital. Its rate of return determines your future options. Take a job for
what it teaches you, not for what it pays. Instead of a potential employer asking, ‘Where do you see yourself in 5 years?’ you’ll ask, ‘If I invest my mental assets with you for 5 years, how
much will they appreciate? How much will my portfolio of career options grow?’ ”
Stan Davis & Christopher Meyer, futureWEALTH
Seminar Y2K/Brand Inside
Message: Distinct … or
Extinct!
“I don’t think there’s anything worse than being
ordinary.”American Beauty
When you love what you do, you’re alive.
jobs.com
Bill Parcels’ World/ Brand You World!
BLAME NOBODY!EXPECT NOTHING!DO SOMETHING!
NY Post (9/99)
Women and new-economy
management …
The New Economy …
Shout goodbye to “command and control”!
Shout goodbye to hierarchy!
Shout goodbye to “knowing one’s place”!
Women’s Stuff = New Economy Match
Improv skillsRelationship-centric
Less “rank consciousness”Self determinedTrust sensitive
IntuitiveNatural “empowerment freaks” [less
threatened by strong people]Intrinsic [motivation] > Extrinsic
“Boys are trained in a way that will make
them irrelevant.”
Phil Slater
It’s Girls, Stupid!
1996: 8.4M women, 6.7M men in college (est: 9.2 to 6.9 in 2007); more women than men in
high-level math and science courses
More girls in student govt., honor societies; girls read more books, outperform boys in artistic and musical ability, study abroad in
higher numbers
Boys do rule: crime, alcohol, drugs, failure to do homework (4:1)
Source: The Atlantic Monthly (5/2000)
[ … and women are Market Opportunity #1]
Brand Inside
Brand Talent: The Great War for Talent
Issue Y2K
The Great War for Talent!
“When land was the scarce resource, nations battled
over it. The same is happening now for talented people.”
Stan Davis & Christopher Meyer, futureWEALTH
“The market’s being divided up right now. We’re in a
tough competition [with the U.S. and the U.K.] for
the best brains.”Gerhard Schroeder, on Germany’s new
tech immigration policy[Frankfurter Allgemeine/06.02.00]
Tomorrow’s Headlines
“Molecular biologists are up 3 points, economists
down 1/4 , in moderate trading”futureWEALTH, Stan Davis and
Christopher Meyer
TALENT AGENT: Babe! Babe! You’re not hearing me. My guy is not stepping foot into your greenroom until
we have a deal, including restructured profit participation on the video and Internet rights.
DEPARTMENT HEAD: Look, Sid, your boy’s not our only option. There’s also Schwartz, Taylor, Wycoff …
TALENT AGENT: Sorry, babe, I rep them too! This summer I locked up your whole department.
DEPARTMENT HEAD: My whole math department?TALENT AGENT: You want to talk package? I can go
there!
Source: Gary Trudeau/Doonesbury
There is no “talent shortage” …
if …
you are a GPTW*
*Great Place To Work
Talent war, Web-speed!
Every resume or employment question that comes to Lucent via
the Web gets answered in 30 minutes or less. [24/7.]
Red Herring [06.00], on Lucent Director of
Recruitment Jim Baughman
“The leaders of Great Groups love talent and know where to find it. They revel in the talent of others.” Warren Bennis & Patricia Ward Biederman
Alan Kay on PARC’s Bob Taylor
“He was a connoisseur of
talent.”
“Our business needs a massive transfusion of talent. And talent, I believe, is most likely to be found among non-conformists, dissenters and rebels.” David Ogilvy
Axiom: Never hire anyone without an aberration in their
background. (Find the One Ton Cookie Man!)
“He grew his hair long, played guitar in a rock band, chased
girls, got into trouble. At age 17 he was flogged by his house
master, who described him as ‘the most difficult boy I’ve ever
had to deal with.’ ”
Solution?
Ritalin [“a chemical virtually identical to cocaine”/Reason
magazine]
Or …
Elect Him Prime Minister
Tony Blair*
*talk/May 2000
“Whoever is the most impertinent
has the best chance.”
W.A. Mozart
“Conformity is the enemy of freedom
and the jailer of growth.”
J.F.K.
H.R. to H.E.D. ???
HumanEnablement Department
“Firms will not ‘manage the careers’ of their employees. They
will provide opportunities to enable the employee to develop
identity and adaptability and
thus be in charge of his or her own career.”
Tim Hall et al., “The New Protean Career Contract”
Yes!
Director of Bringing in the Really Cool People
All You Need to Know?
Chief Evangelist For Really Neat Stuff
Director Of Bringing In The Really Cool People
T.T.D.
STEAL THESE TWO JOB TITLES!
“Every school I visited was participating in the systematic suppression of creative genius.”
“From cradle to grave the pressure is on: BE NORMAL!”
Gordon MacKenzie
“The school system is absolutely not designed for creativity. Quietness, going along with the flow, keeping order – this is what’s encouraged.”
Tom Yamokoski
Talent = Brand
Brand Outside=
Brand Inside
Brand inside
A BIAS FOR ACTION = No. 1
S.A.V.
Net World!
Act now. Analyze later.
Avram Miller
[TP to Chain Owner …
“Do 5 deals before you go home!”]
Fail. Forward.
Fast.
High-tech exec
Ready.Fire!Aim.
Ross Perot, Wayne Calloway, Harry Quadracci, et al.
“Steve Ross had a wonderful philosophy: People get fired for
not making mistakes.”Bob Pittman
He who has the quickest O.O.D.A. Loops* wins!
*Observe. Orient. Decide. Act. / Col. John Boyd
Culture of Prototyping
“Effective prototyping may be the most valuable core
competence an innovative organization can hope to
have.”
Michael Schrage
“You can’t be a serious innovator unless and until you are ready,
willing and able to seriously play. ‘Serious play’ is not an oxymoron;
it is the essence of innovation.”
Michael Schrage, Serious Play
ABfA [A Bias for Action]
RFA [Ready.Fire!Aim.]
SAV [Screw Around Vigorously]
FFF [Fail Forward Fast]
OODA [Observe.Orient.Decide.Act.]
Bottom Line:The new
metabolism!
Forces @ Work II
The Commodity Trap
In the Beginning …
“The audit has become a commodity.”
Big 5 audit partner to TP
Quality Not Enough!
“Quality as defined by few defects is becoming the price of entry for automotive marketers rather than
a competitive advantage.”
J.D. Power
Quality Not Enough!
“While everything may be better, it is also increasingly
the same.”
Paul Goldberger on retail, “The Sameness of Things,” The New York Times
What’s Special?
“Customers will try ‘low cost providers’ because the Majors have not given them any clear
reason not to.”
Leading Insurance Industry
Analyst (10-98)
“We make over three new product announcements a
day. Can you remember them?
Our customers can’t!”Carly Fiorina
“The ‘surplus society’ has a surplus of similar companies, employing similar
people, with similar educational backgrounds, coming up with similar ideas, producing similar things, with similar prices and similar quality.”
Kjell Nordstrom and Jonas Ridderstrale, Funky Business
The “10X/10X Phenomenon”
10 Times Better/
10 Times Less Different
“When we did it ‘right’ it was still pretty
ordinary.”
Barry Gibbons on
“Nightmare No. 1”
Aarrgh!
“Quality is conformance to requirements, not
goodness.”
Phil Crosby
Pretzel Crumb-less-ness Plus …
“The Ritz Carlton Experience enlivens the senses, instills
well-being and fulfills even the unexpressed wishes and needs of
the guest.”
from the Ritz Carlton Credo
“You do not merely want to be the best of the best. You
want to be considered the only ones who do
what you do.”
Jerry Garcia
What Jerry Should Have Said???
“You do not merely want to be the best of the best, you want to be considered in conformance with
requirements.”
Nirvana!
- Nordstrom- Four Seasons
- Adirondack Guide Boat- OXO Good Grips
- Ziplocs- Power Point
Why?
Cool!/Surprising!Reliable!
Friendly!/Comfortable!Aesthetically pleasing!
Consider …
What words and emotions do you use to
describe the things you love?
Context: “No” to “inevitable commoditization”
S1: Lead the Customer!S2: Master E-Commerce!
S3: Women Rule! (and the elderly)
S4: Design Rules! (too)
S5: It’s the Experience!Net: Glorious Age of the BRAND!
Context: “No” to “inevitable commoditization”
S1: Lead the Customer!S2: Master E-Commerce!
S3: Women Rule! (and the elderly)
S4: Design Rules! (too)
S5: It’s the Experience!Net: Glorious Age of the BRAND!
Brand Outside
Strategy 1:
Lead the Customer!
“The customer is a rear view mirror, not a guide to the future.”
George Colony, Forrester Research
“If you worship at the throne of the voice of the customer, you’ll get only
incremental advances.”Joseph Morone, President, Bentley College
Early Customer Rejection
Post-Its [12 years!]Chrysler Minivans
VCRsFax machines
FedExCNN
Heart-assist pumpsEtc.
Source: Fortune
Good = Bad/ 1 of 30,000
“We are crazy. We should do something when people say it is
‘crazy.’ If people say something is ‘good’, it
means someone else is already doing it.”
Hajime Mitarai, Canon
“Wealth in this new regime flows directly from innovation, not
optimization. That is, wealth is not gained by perfecting the known,
but by imperfectly seizing the unknown.”
Kevin Kelly, New Rules for the New Economy
“Lead” customers!
K2K redux!
T.T.D.: Do You K2K?
Are you working with [numerous] weird, far out customers? [As
opposed to “biggest” customers?]
Notes Page
• Trust me! You will be as Cool as your Coolest Clients. Cool Clients co-invent the future with us. Soooo … WHAT’S YOUR COOL CLIENT PORTFOLIO LOOK LIKE? [Hint: “Biggest” are rarely “coolest.”]
T.T.D./Sooooo…
Are you pushing your customers? [Internal or
external.] ARE YOU ENGAGING THEM IN A
JOINT VENTURE-JOURNEY INTO TOMORROWLAND?
Notes Page
• No bull: Evaluate EVERY Client Relationship. Is EVERY CP/Client Project a “test”? That is, an effort to explore Uncomfortable-But-Important-Stuff?
Amen!
“The Age of the Never Satisfied
Customer”Regis McKenna
Context: “No” to “inevitable commoditization”
S1: Lead the Customer!
S2: Master E-Commerce!S3: Think Global!
S4: Women Rule! (and the elderly)
S5: Design Rules! (too)
S6: It’s the Experience!Net: Glorious Age of the BRAND!
Brand Outside
Strategy 2:
Use E-Commerce
to Re-invent the Business!
2X = 100 days (Internet traffic)
2X = 9 months (network capacity)
Source: Red Herring (1-00)
Web World/05.00
1B pages/7B hotlinks/+1M per day
“For the first time in history, people everywhere have access to the
thoughts, products and writings of a large and growing percentage of
earth’s population.”
The New Yorker/05.29.00
Tomorrow Today: Cisco!
90% of $14.4BSave $500M (service and tech
support)
C.Sat e >> C.Sat HCustomer Engineer Chat Rooms ($1B?)
B2B
1999 – 2004: 50X
2004: $7.4Source: GartnerGroup (per Reuters 1-26-00)
T
GM/Ford/DaimlerChrysler (02-27)
Covisint$240B (+$500B)
I.P.O.
B2B = No.1
CarStation (auto-body shops), ChemConnect (chemicals),
Collabria (commercial printing), DigitalThink (corporate training), E-Steel (steel), Medibuy (medical
supplies), Portera (knowledge workers), Etc., Etc., Etc., Etc.
Goal?
Drive profits to zero!*
*Remember AMR and “dynamic pricing.”
W.W. Grainger*
2X phone/fax
*$220B “MRO” market (per Business 2.0/02-00)
[Pervasive “Risk Markets”
“For a dollar a month, an Ohio insurance company will rent you a GPS receiver to
install in your car. As part of your policy, it signals how often, when, and which highways you drive and into which
neighborhoods you go. The premium you pay reflects your actual driving risk.”
Stan Davis & Christopher Meyer, futureWEALTH]
Welcome to
D.I.Y. Nation!“Changes in business processes will emphasize self service. Your costs as
a business go down and
perceived service goes up because customers are conducting it
themselves.” Ray Lane, Oracle
Shop in your Underwear
Source: SM’d logo for www.ae.comae = American Eagle Outfitters
Psych 101: Strongest Force on Earth?
My need to be in perceived control of
my universe!
Anne Busquet/ American Express
Not: “Age of the Internet”
Is: “Age of Customer Control”
The Supply Side …
The Age of the ChoiceboardThe War of the Choiceboards
Source: Adrian Slywotzky, HBR 1-2/2000 [<1%]
“In the network economy, the Website becomes the company’s primary interface to the customer.
The user interface becomes the marketing materials, store front,
store interior, sales staff and post-sales support all rolled into one.”
Jakob Nielsen, Designing Web Usability
“Most companies would do more business on the Internet if they
fired their entire marketing department and replaced it with
people who could produce interactive content that actually made it easier for users to buy.”
Jakob Nielsen, Nielsen Norman Group
Red Herring (01/00)
75% of online shoppers don’t complete their
purchase!
Nielsen/Designing Web Usability
All Web projects are customer-interface projects! Simplicity rules!
Make it easy for customers to perform useful tasks!
Less “cool,” more useful!Speed rules!
“Even if executives of established businesses grasp the impact of new
technologies … they still face a massive competitive disadvantage precisely
because they are incumbents. … They do complex financial calculations and get
bogged down in internal political debates. Insurgents have no such
inhibitions.”
Philip Evans & Thomas Wurster, Blown to Bits
“ … if they set up a completely independent organization and let that organization attack the
parent.”
Clayton Christensen, The Innovator’s Dilemma
“Where does the Internet rank in priority?
It’s No. 1, 2, 3, and 4.” Jack Welch
There are 2 Kinds of …
Defense*
vs.
Offense**
*Fend off upstarts.**Reinvent our marketspace!
“Banking is
necessary. Banks are not.”
Dick Kovacevich, Norwest/ Wells
No Room for “Competent”* Sorts
Beer WholesalersPersonal Trainers [FitLinxx]
Financial PlannersCar Dealers
* LVA, “M”VA … vs. HVA [Web-enhanced]
Web Strategy: GE Power Systems
“Launch and Learn”(4 sites in 30 days)
“It’s better to be first with less than last with more. Success on
the Web isn’t just about time to market, it’s also about
‘time to learning.’ ”
Jeff Levy, eHatchery
Jargon Bath!
Bureaucracy free …Systemically integrated …
Internet intense …Knowledge based …
Time and location free …“Instantly” responsive …
Customer centric …Mass customization enabled.
Translation …
Bureaucracy free = Flat org, no B.S.Systemically integrated = Whole supply chain
tightly wired/ friction freeInternet intense = Do it all via the Web
Knowledge based = Open accessTime and location free = Whenever, wherever
“Instantly” responsive = Speed demonsCustomer centric = Customer calls the shotsMass customization enabled = Every product
and service rapidly tailored to client requirements
Context: “No” to “inevitable commoditization”
S1: Lead the Customer!S2: Master E-Commerce!
S3: Women Rule! (and the elderly)
S4: Design Rules! (too)
S5: It’s the Experience!Net: Glorious Age of the BRAND!
Brand Outside
Strategy 3:
Women Rule!
?????????
Home Furnishings … 94%Vacations … 92%
Houses … 91%Bank Account … 89%
Health Care … 75%Etc.
$3.3T + $1.5T = $4.8T*
* Larger than Japan!
Most Under-reported story!
9M*/28M(1 of 4)/$3.6T [> Germany]
* 400K in ’72; 132% since ’92
Sources: NFWBO, Cognetics, Business Wire (030600)
48% working wives > 50%80% checks
61% bills53% stock (mutual fund boom)
43% > $500K95% financial decisions/
29% single handed
Women … 49% of Web users; 6 of 10 new users; 83% of wired women are primary decision makers for family healthcare,
finances, education.
Source: Business Week (11-99)
New golfers … 37%Basketball … 13.5M
1 in 27 (’70) … 1 in 3 (’96)
1874?
1874 … Jock Strap1977 … Jogbra
1977 ... 25K
1996 … 42M
Yeow!
1970 … 1%
2000 … 50%
OPPORTUNITY
NO. 1!*
[* No shit!]
Carol Gilligan/ In a Different Voice
Men: Get away from authority, familyWomen: Connect
Men: Self-orientedWomen: Other-oriented
Men: RightsWomen: Responsibilities
FemaleThink/ Popcorn
“Men and women don’t think the same way, don’t communicate the same
way, don’t buy for the same reasons.
“He simply wants the transaction to take place. She’s interested in creating a relationship. Every place women go,
they make connections.”
Women and Healthcare
Women are … more dissatisfied, frustrated by the way they are treated
and spoken down to by physicians, seek more information, are more pressed for time … and make 75% of health care decisions and control 2/3 of health care $
$$$ [and constitute 2/3 of health care employees].
Source: Patricia Braus, Marketing Healthcare to Women
Women and Financial Advisors
Women want … a plan, to be listened to, to be taken seriously, to read about it, to think about it.
Women do not want … an in-your-face sales pitch
Source: Kathleen Boyle, Wheat Boyle Butcher Singer
E.g.: Quicken.com: gender-neutralTheStreet.com: male-ish (“aggressive,
we-tell-you-what-to-think”)MotleyFool.com: female-ish
(“inquisitive, open, supportive”)WFN and MsMoney.com: female (e.g.:
emphasize parenting and divorce issues)
Source: Red Herring, Kathleen Morris of WFN
How Many Gigs You Got, Man?
“Hard to believe … Different criteria”
“Every research study we’ve done indicates that women really care about the relationship with their
vendor.”
Robin Sternbergh/ IBM
Q: Why do guys like pagers?
A1: Sense of importance [Pager Dude]
A2: Cubicle Slaves’ replacement for “real guys” tool belts
Q: Why do women like pagers?
A: Get the news A.S.A.P. if her child is in the Nurse’s Office
Q:Why do women hate pagers?
A: They find nothing romantic about wearing a Stetson wrench or Stanley hammer attached to their waist! [Note
the pager’s clip-on device … guys ]
[ It’s Simple …
Women are more thoughtful and more deliberate
than men!]
Not!!
“Year of the Woman”
Enterprise Reinvention!
RecruitingHiring/Rewarding/ Promoting
Structure Processes
MeasurementStrategyCulture Vision
Leadership
THE BRAND ITSELF!
“What kind of car does Mommy want?”
“I didn’t know [company] were giving
company cars to secretaries.”
Source: UK financial services CEO, 12/99
27 March 2000: email to TP from Shelley Rae Norbeck
“I make 1/3rd more money than my husband does. I have as much financial
‘pull’ in the relationship as he does. I’d say this is also true of most of my women
friends. Someone should wake up, smell the coffee and kiss our asses long enough
to sell us something! We have money to
spend and nobody wants it!”
Not a Morality Play!
“It is critical that we all understand that IBM is not marketing to women
entrepreneurs because it is the thing to do, or even the right thing to do.
We are marketing to women entrepreneurs because it is a huge
opportunity.”
Cherie Piebes
Wanna see my “porn”
collection?
THIS JUST MIGHT BE THE BIGGEST “THING” IN THIS
SEMINAR. PLEASE: THINK ABOUT IT!
“If we are single, they say we couldn’t catch a man. If we are
married, they say we are neglecting him. If we are divorced,
they say we couldn’t keep him. If we are widowed, they say we
killed him.”
Kathleen Brown, on the joys of female political candidacy
Speaking of Enormous
[Missed] [Huge] Opportunities ...
74/55
“At each stage of their lives, the needs and desires of the baby
boomers have become the dominant concerns of American business and popular culture. If you can anticipate
the movement of the baby-boom generation’s life-span migration, you
can see the future.”Ken Dychtwald, Age Wave
Aging/“Elderly”
2X growth rate$$$$$$$$$$$$
“I’m in charge!”
Good source: Ken Dychtwald, Age Wave
Priorities: Aging/“Elderly”
Experiences … Convenience … Comfort
… Access … Respect!
Context: “No” to “inevitable commoditization”
S1: Lead the Customer!S2: Master E-Commerce!
S3: Women Rule! (and the elderly)
S4: Design Rules! (too)
S5: It’s the Experience!Net: Glorious Age of the BRAND!
Brand Outside
Strategy 4:
Design Rules!
And Tomorrow …
“Fifteen years ago companies competed on price. Now It’s
quality. Tomorrow it’s design.”Robert Hayes
All Equal Except …
“At Sony we assume that all products of our competitors have basically the same
technology, price, performance and
features. Design is the only thing that differentiates one product
from another in the marketplace.”
Norio Ohga
“Design is treated like a religion at BMW.”
Fortune (10/98)
Drop-dead Charm!
“The new Beetle fails at most categories. The only
thing it doesn’t fail in is drop-dead charm.”
Jerry Hirshberg, Nissan Design International
Object of Desire!
“Every now and then, a design comes along that radically changes the way we think about a particular object. Case in
point: the iMac. Suddenly, a computer is no longer an anonymous box. It is a
sculpture, an object of desire, something that you look at.”
Katherine McCoy, Michael McCoy, Illinois Institute of Technology
Design as Soul
“We don’t have a good language to talk about this kind of thing. In most people’s
vocabularies, design means veneer. … But to me, nothing could be further from the
meaning of design. Design is the fundamental soul of a
man-made creation.”Steve Jobs
Check Out the Language:
“Tomorrow it’s design …”“Design is the only thing …”
“Design is … religion ...”“Drop-dead charm …”“Object of desire …”
“Fundamental soul …”
Think Back …
New Beetle, iMac = Radical, “Bet the
Company”
Right?
The I.D. [International Design] Forty*
Airstream … Alfred A. Knopf … Apple Computer … Amazon.com …
Bloomberg … Caterpillar … CNN … Disney … FedEx … Gillette … IBM … Martha Stewart … New Balance …
Nickelodeon … Patagonia … The New York Yankees … 3M … Etc.
* List No. 1, 1999
Unconventional [Design] Messages
Not about ... “Lumpy Objects”!
Not about ... $79,000 objects
“Car designers need to create a story. Every car provides an
opportunity to create an adventure. …“The Prowler makes you smile. Why? Because it’s focused. It has a plot, a
reason for being, a passion.”
Freeman Thomas, co-designer VW Beetle; designer Audi TT
Hmmmm(?): “Only” Words …
StoryAdventure
Smile FocusPlot
Passion
T.T.D./Message:Services are Not Intangible!
You “give off” hundreds of design cues … daily!
YOU ARE A DESIGNER!
Notes Page
• List 100 [!] “design cues” that you give off! [Okay, start with 25.]
Graceful language!
T.T.D./“Beauty Contest!”
1. Pick one form/ document: invoice, airbill, sick leave policy, returns claim
form.2. Rate it on a 1 to 10 scale
(1 = Awful; 10 = Scintillating) on three dimensions: Beauty, Grace, Clarity.
3. Repeat … every 15 days.
Notes Page
• DO THIS! USE MY TERMS! [Beauty … Grace … Clarity.] Be quantitative. [PLEASE.]
Design =
SIMPLICITY … HONESTY … ACCESSIBILITY …
ENJOYMENTJonathan Ive (iMac)
Design =
“There are three basic principles behind any well-
designed product: truth, humanity, and
simplicity.”Sohrab Vossoughi,
Ziba Design
Words (Again!)
Drop-dead Charm … Object of Desire … Truth … Humanity … Simplicity … Focus … Honesty … Accessibility … Enjoyment
… Story … Adventure … Plot … Passion
“My favorite word is grace – whether it’s amazing grace,
saving grace, grace under fire, Grace Kelly. How we live
contributes to beauty – whether it’s how we treat other people or
the environment.”
Celeste Cooper, designer
Grace.
T.T.D./Design “Awareness”!
STEP No. 1: NOTEBOOK![Start recording the awesome
and the awful.]
Notes Page
• THIS IS MY “SECRET.” I am not “artistic.” But … I did teach myself to be … CONSTANTLY AWARE. The Key: My [simple] notebook! [I’VE NOW BEEN “RECORDING” FOR ALMOST TEN YEARS!]
Context: “No” to “inevitable commoditization”
S1: Lead the Customer!S2: Master E-Commerce!
S3: Women Rule! (and the elderly)
S4: Design Rules! (too)
S5: It’s the Experience!Net: Glorious Age of the BRAND!
Brand Outside
Strategy 5:
It’s the Experience!
“Experiences are as distinct from services as services are from
goods.”Joseph Pine & James Gilmore, The
Experience Economy: Work Is Theater & Every Business a Stage
“The [Starbucks] Fix” Is on …
“We have identified a ‘third place.’ And I really believe that sets us apart. The third place is
that place that’s not work or home. It’s the place our
customers come for refuge.”Nancy Orsolini, District Manager
Experience: “Rebel Lifestyle!”
“What we sell is the ability for a 43-year-old accountant to dress in black leather, ride through small towns and have people be afraid
of him.”
Harley exec, quoted in Results-based Leadership
Mantra: “Any good can be ing-ed”
the driving experiencethe pumping experience
the sitting experiencethe reading experiencethe washing experiencethe cooking experience
Joseph Pine & James Gilmore, The Experience Economy: Work Is Theater & Every Business a Stage
[NAPM: Think …
Supply Chain-ingB2B-ing]
“This is the end of the pure product era. For instance, car
makers are beginning to understand that the car is a
platform for delivering services that drive the customer
experience.”Carly Fiorina, HP @ Comdex ’99
And Now For A Nod To 1/7th of Our Economy!
“Medicine looks likely to change more in the next 20 years than it has in
the last 200.”
British Medical Journal (11-11-99)
Health Care Tsunami
Prevention/Wellness/FitnessProactive Engineering/Gene
“stuff”[Blockbuster-Bazooka to Specific-Sniper’s Rifle]
Holistic/Homeopathic/Non-traditionalPatient-centric/Web-led
No waste [Healtheon/WebMD et al.]Etc.
TP 03.26.00: AMA Riff
Are You Fighting Yesterday’s War?Docs don’t know it all.
There are a lotta bad docs. There are a lotta bad medical decisions.
“Hospitals” kill far too many people. (Bad decisions, bad execution.)
Systemic waste is stratospheric. (Still.)
Patients are getting (much) smarter.Patients have had it with HMOs. (And Docs with the
“white-coat syndrome.”) You are not smarter than I am. (I am your partner.)
You are not busier than I am. (!!!!!)Patients want more data. (And can readily get it.)
Boomers will control their lives. Period. Medicine is about to be overwhelmed with a tsunami!
Confusing Message*
Traditional indemnity: 37% to 11% [’94-’99; 77% in ’88]
HMO: 23% to 30%
PPO: 25% to 43%
*Cut the waste & provide choice
Alternative Medicine
More visits than to physicians
Same $$$ expenditure [approx $27B]
Stanford study: 2/3 use alt therapies
“This is the first time in Western medical history that we have had a movement that is consumer
driven.”/Dr. Woody Merrell, Center for Health and Healing, Beth Israel Hospital, Manhattan.
[Merrell: Process = Partnership.]
Source: Barron’s/05.15
SoftWatch (MS)“Manage relationships across the
healthcare continuum”/ Amir Kishon
Establish e-relationships with customers/retain customers/collect data
Patients record info + receive feedback/ Online access to nurses
Community with others with MS
Etc.Source: Start-Up
1965: “ ‘Doctor’ will see you now. ‘Doctor’ will take care of you.”
YES, NURSE. ME GOOD PUPPY DOG.
1995: “HMO will take care of you.”
BULLSHIT.
2005: “I will take care of me. I’d like your expert help.”* [*P.S.: THE VIAGRA, ETC.] I
ORDERED ON LINE IS GREAT.]
Patient-centric* Health Care
Wellness (Fix to prevent.)
Partnership (“Tour guide” model.)
RESPECT! (Mutual.)
WOMEN RULE!
*Not: HMO-centric, Employer-centric, Insurer-centric, Doc-centric
AMA: Push “Patient
Partnership” Model????
Context: “No” to “inevitable commoditization”
S1: Lead the Customer!S2: Master e-commerce!
S3: Women Rule! (and the elderly)
S4: Design Rules! (too)
S5: It’s the Experience!Net: Glorious Age of the BRAND!
Brand Outside
BRAND POWER!
Brand It! Now, More Than Ever!
“The increasing difficulty in differentiating between products and
the speed with which competitors take
up innovations will assist in the rise and rise of the brand.”
Gillian Law and Nick Grant, Management [New Zealand]
No Room for Brands?
NikeSaturnCNN
America OnlineCharles Schwab
StarbucksThe Gap
IntelEtc.
Brand = Trust!
“Most buyers do not have a clue whether anybody else makes a better microprocessor, but ‘Intel Inside’ has become a ‘trust mark’ - a trademark that consumers put their faith in.”
The Economist
What Can [Can’t] Be Branded?“Branding is not a problem if you have the right mentality. You go to your team and
you pin up a $200 Swiss Army Watch. Competing in the ridiculously crowded
sub-$200 watch market, they made it into a brand name, named after the most
irrelevant and useless thing in history [the Swiss Army]. And you say, ‘Gang, if they
can do it, we can do it.’ ”
Barry Gibbons
“Salt is salt is salt. Right? Not when it
comes in a blue box with a picture of a little girl carrying an umbrella. Morton International continues to dominate the U.S. salt market even though it charges more for a product that is demonstrably
the same as many other products on the shelf.”
Tom Asaker, Humanfactor Marketing
“Consumers don’t simply buy products, they buy attitudes as well. When confronted with proliferation and
diversity, choices become increasingly informed by belief. [Consumers] want to
know who is behind the products that they buy. They want to know the
company. They want to know what you think.”
Jesper Kunde, Corporate Religion
T.T.D./Calling the Corporate Shrink!
“Organizational Psychotherapy”/
WHO WE ARE!
Notes Page
• This is The Big Enchilada:
SPEND – lotsa – TIME ON IT!
Brand = You Must Care!
“Success means never letting the competition define you. Instead you have to define
yourself based on a point of view you care deeply about.”
Tom Chappell, Tom’s of Maine
“We are in the twilight of a society based on data. As information and intelligence become the domain of computers, society will place more value on the one human ability that cannot be automated: emotion.
Imagination, myth, ritual - the language of emotion - will affect everything from our purchasing decisions
to how we work with others. Companies will thrive on the basis of their stories and
myths. Companies will need to understand that their products are less important than their stories.”
Rolf Jensen, Copenhagen Institute for Future Studies
“In the funky village, real competition no longer revolves
around marketshare. We are competing for attention –
mindshare and heartshare.”Kjell Nordstrom and Jonas Ridderstrale,
Funky Business
T.T.D./Assignment Y2K
Write an essay on “Who we are.”*
* Jesper Kunde, Corporate Religion
Notes Page
•DO IT! 500 words.
•[And then: 10 words.]
Context: “No” to “inevitable commoditization”
S1: Lead the Customer!S2: Master E-Commerce!
S3: Women Rule! (and the elderly)
S4: Design Rules! (too)
S5: It’s the Experience!Net: Glorious Age of the BRAND!
Brand Outside
Reprise
[“Incrementalism is innovation’s worst enemy.”
Nicholas Negroponte]
Lead the Customer: Why Tough
Guts!Failures!
Re-invention via ecommerce: Why Tough
Total commitment to total enterprise [and supply
chain] reinvention!
Yo, C.D.O.!!!!!!!!
Women’s Market: Why Tough
EncompassingAttitude
CULTURAL!
Design: Why Tough
True-believer-dom-shipEncompassing/Cultural
Ing-ing/Experience: Why Tough
Total Reorientation
Brand Power: Why Tough
Way of LifeForever!
Passion Rules!Touches Everything!It Am Me [Personal!]
Message :
Not for the Faint of Heart!*
*Weenies need not apply
Brand Leadership
Passion Rules!
Brand Leadership!
“A key – perhaps the key – to leadership is the effective
communication of a story.”
Howard Gardner Leading Minds: An Anatomy of Leadership
“The challenge for IBM, AT&T and other mainstream companies is to re-instill a sense of adventure in
recruits.”
Burke Stinson, AT&T
“Create a Cause, not a ‘business.’”
Gary Hamel, Fortune (06.00), on re-inventing a company (Exemplar #1:
Charles Schwab)
“Leadership is a performance. You have to be
conscious of your behavior, because everybody else is.”
Carly Fiorina
Brand Leadership:ENTHUSIASM RULES!
“I am a dispenser of enthusiasm.”/ Ben
Zander
Talent “War,” Marketplace “War”
“The successful company has to create an environment that imbues
its employees with a sense of passion.”
Joe Nocera, eCompany, on David Pottruck
Ann Richards’ Dogma
Show up!
Know your message!
PUT YOURSELF AT RISK EVERY DAY!
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