Post on 03-Jan-2016
description
TOM PETERS’ LESSONS IN
LEADERSHIP2000
1 FEBRUARY ALBUQUERQUE
ALL SLIDES ARE AVAILABLE AT
tompeters.com
Seminar Y2K
Brand Everything:Distinct or Extinct
Microsoft = R.O.W.
Microsoft > GM + Ford + Boeing + Lockheed Martin + Deere + Caterpillar + USX + Weyerhauser + Union Pacific + Kodak + Sears + Marriott + Safeway + KelloggSource: Business Week data through 5-99
Microsoft = R.O.W. (II)
Microsoft > GM + Ford + Boeing + Lockheed
Martin + Deere + Caterpillar + USX + Weyerhauser + Union Pacific + Kodak + Sears + Marriott + Safeway + Kellogg +
McDonald’s + Bank One + General Mills + American Airlines + United Airlines + + Delta Air Lines + US Airways + Quaker Oats
Source: Yastrow Marketing (through 11-23-99)
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)
Forces at Work
The Destruction Imperative!
64/24
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
Q: What do you do when you are a big,
dopey company and out of ideas?
A: You merge with another big,
dopey company that doesn’t
have any ideas either.
R: An incredibly big, incredibly dopey company
… going nowhere.
“When asked to name just one big merger that had lived up to
expectations, Leon Cooperman, former co-chairman 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
“I feel betrayed. I bought stock in a company that was going to change the world. I didn’t buy a big, fat, stupid conglomerate. And now
I’ve got one.”Alan Towers, consultant, quoted in Business Week
[BW: “The irony is that AOL Time Warner is a vertically integrated conglomerate. Not exactly the sort of nimble
competitor that will thrive in cyberspace.”]
“Acquisitions are about buying market share. Our challenge is to create markets. There is a big difference.”
— Peter Job, CEO, Reuters
“We chose not to do a discounted cash flow analysis of their future earnings. We wanted their talent and we wanted their intellectual property.”
Art Reidel, CEO, Pharsight
“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 Systems
Dept. Head = Sports GM
Dept. Head = V.C.
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, $3.5B
Source: Fast Company (12-99)
EcoNets/Internet Zaibatsus
“The model is about partial acquisitions and ownerships that then form a whole. Each part has to have value separately, be able to raise capital separately, and
motivate employees separately. Corporations of the past never had that.”
Flip Filipowski, divine interVentures (Red Herring)
“The brick and mortars will die, no matter what. … So you have to take
your best employees and best businesses and spin them off and just own 40 percent of everything
that’s left. Do that and you survive.”
Flip Filipowski, divine interVentures (Red Herring)
DYB.com*
*DestroyYourBusiness.com (GE)
“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]
The Gales of Creative Destruction
+29M = -44M + 73M
+4M = +4M - 0M
“But what if [former head of strategic planner at Royal Dutch Shell] Arie de Geus is wrong in
suggesting, in The Living Company, that firms should aspire to live forever? Greatness is
fleeting and, for corporations, it will become ever more fleeting. The ultimate aim of a
business organization, an artist, an athlete or a stockbroker may be to explode in a dramatic
frenzy of value creation during a short space of time, rather than to live forever.”
Kjell Nordstrom and Jonas Ridderstrale, Funky Business
“ALL OF THESE ‘CONVERSATIONS’ TODAY ABOUT ‘THE WEB’ WILL APPEAR SO BLOODY DAMN SILLY AND PEDESTRIAN TEN … FIVE? … THREE? … YEARS FROM NOW.”
Tom Peters (11-99)
P.S.: Read Ray Kurzweil’s The Age of Spiritual Machines: When Computers Exceed Human Intelligence
BW: “human brain has only a short time left as the smartest thing on earth”/ “subjugate
humanity by 2050”
Health Forum Journal: “In one generation or less, every element of health care, every
assumption, will be changed or gone.”/ “We are not aging gracefully.”
Dr. George Poste, SKB: 500 molecular targets in ’95 to 70,000 in ’99/
35 compounds per year to2M
Wired [Feb 2000]
“Cyborg 1.0: Kevin Warwick Outlines His Plan
to Become One with His Computer”
“Medicine looks likely to change more in the next 20 years than it has in the last
200.”
British Medical Journal (11-11-99)
[ TTTTTurbulent Times!
Top 3 Americans > 48 poorest nations
Source: Newsweek 12-99]
Brand Inside
PSF 1:Brand Org!
108 X 5vs.
8 X 1*
* 540 vs. 8
ERP, ECM, Web, Etc.
IT’S THE GIANT SUCKING SOUND
OF SLACK BEING EXTRACTED FROM
THE GLOBAL ECONOMY!
“The coefficient of friction associated with the grunge
of business is amazing!”
Michael Schrage
Cemex and FDX!
CCC Information Services!
“Assetless Company”
J.B.
RR on 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.”
“We want to be the air traffic controllers
of electrons.”Bob Nardelli,
GE Power Systems
The “&-!!+#$% in the middle”*
Jim Clark on Healtheon
* ’twixt docs, patients and providers; $250B in waste; source: Michael Lewis,
The New New Thing
“Don’t own nothin’ if you can help it. If you can, rent your shoes.”
F.G.
R&D Outsourcing/ Big Pharma
3:1+ (70% now; 5% in 5 years)
1:2+ (5% now; 20% in 5 years)
Source: IN VIVO
PSF 1.0
Professional Service Firm Conversion Kit /
Release 1.0
White Collar Revolution(Finally!!)
90% … in 10 years!PSFs ….. All!
Brand Yous … All!WOW Projects … All!
PSF 1.0
Department Head
to …
Managing Partner, HR [IS, etc.] Inc.
Credo
“WORK WORTH
PAYING FOR”
“support function” / “cost center” / “bureaucratic
drag”
or …
“Rock Stars of the ‘Age of Talent’ ”
Why are there no books on how to create
a “Cool, Rocking, WOW-producing
Finance Department”?
“Real” PSF …–Think Inc. (Mindset = Step No.1!)–Clients rule! –Engage Clients in deep dialog/ “Join
us in an Adventure”/ Fire duds!–Work = WOW Projects (100%)–Practice serial monogamy –Think impact!/ Embrace politics!–Master “the economics”!
“Real” PSF …– WE HELP PEOPLE!
– Co-habit with the Client!
– Create a Culture of Urgency!
– Love thy Support Staff!
– You need a Methodology!
– Obsess on R&D!
– BECOME A “CONNOISSEUR OF TALENT”!
Real PSF …
WE OWN THIS PLACE!THIS IS COOL STUFF!
WE ARE THE WORLD!*
*Why no books on “Cool Finance Depts.”?
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
[ 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
PSF 2:Brand Work!
“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!
I. Create!
Reframe! THERE ARE NO “SMALL” PROJECTS!
Observe & Record!!Head for the trenches!
You gotta love it!
Measure: WOW!, Beauty, Raving Fans, Impact!
Build a no-baloney Business PlanCreate community. Now!
Obsess on … the End User. Now!
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!
E.g.: WOW Scale
1. … Dull as dishwater.
5. … Gets the job done.
7. … “Good work!”.
10. … A serious “Braggable”!
Kaiser: 4.15.29
Liberty Ship
2 years
240 days
9 hours
4 days, 15 hours, 29 minutes
“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?
The “Alumni Meeting” Test!
II. Sell!
Master “The Pitch”!Build Buzz. Consciously.
Network maniacally!Preach to the choir!
Forget your enemies. [Surround and marginalize!]Money kills!
SELL, SELL, SELL!
III. Implement!
- Live, eat, sleep … Quick Prototype-Play!
- Keep on recruiting! (Sell!)- Obsess on the End User Community! (Sell!)
- Become a Milestone Maniac! / a Timeline Tyrant! / a List Freak! / find Ms. Last 2%!
- Appoint a Marketing Director!- Keep the “WOW” front and center!
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
“I view models and prototypes as the
battleground for thoughts and behaviors.”
Michael Schrage
Think about It!?
Innovation = Reaction to the Prototype
Michael Schrage
Prototyper’s Laws
Define 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.]
Secret No. 1: Go horizontal: Find a (one!) “line” ally in “the Boonies”
Secret No. 2: “Powerless” allies are Cool!
Secret No. 3: Passion Rules!Secret No. 4: Become a Prototyping
Maniac! Secret No. 5: Embrace Politics /
“Community Organizing”!
K2K
IV. Exit!
“Sell out!” / Embrace “The Suits”!Recruit a passionate
Ms./Mr. Follow-up!Seed your freaks into the
mainstream!Celebrate!
Exit!
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!
T.T.D.: Now!– List all your 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.
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
Characteristics of the “Also Rans”
–“minimize risk”–“respect the chain of command”–“support the boss”–“make budget”
Source: Fortune on “most admired global corporations”
[We are not trying to “WOW you up.”
We think you are/have WOW.
We are trying to give you permission to be WOW.]
Seminar Y2K
MESSAGE: THE WORK MATTERS!
1) Turn ignition key.2) Shift into drive.
3) Press foot firmly on the throat of mediocrity.
Source: Mercedes ad
Brand Inside
PSF 3:Brand You!
“The fundamental unit of the new economy is not the corporation, but the individual. Tasks aren’t assigned and controlled through a stable chain of command but are carried out autonomously by
independent contractors - e-lancers - who join together in fluid and temporary networks to sell goods and services. When the job is done, the network dissolves and its members become independent again, circulating through the economy, seeking the next assignment.”
Thomas Malone and Robert Laubacher
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)
Personal “Brand Equity” Eval
– My current Project is challenging me …– New things I’ve learned in the last 90 days
include …– My public “recognition program”
consists of …– I am known for …– Additions to my Rolodex include …– My resume is discernibly different from last
year’s at this time …
Icon Woman …–Totally turned on by her work!
–“It” matters / a WOW Project!
–“It” is … COOL!
–“It” is … BEAUTIFUL!
–She is … in your face!
–She is an … adventurer!
–She is … CEO of her own life!
Icon Woman …
– She is … at least … a little funky!– Her curiosity is … insatiable!– She thinks screwups are …
as normal as breathing!– She hangs out with some …
seriously rad Dudes!– She is not God. She is not Bionic
Woman. She is … determined to make a damned difference!
“Well-behaved women rarely make history.” Anita Borg,Institute for Women and Technology
Icon Woman Meets the Web …– submits resume on the Web– recruited on the Web– hired on the Web– trained on the Web– creates and conducts projects with
virtual teams on the Web– manages project and client
follow-up on the Web– manages career/reputation-building
on the Web
“The Brand Called URL”/Nathan Shedroff, Vivid Studios
“24 X 7 storefront devoted exclusively to The Brand Called You.”
NS
“Personal publicity represents the next big paradigm shift on the Web.”
Jerry Yang, Yahoo!
R.D.A.Rate: 15%?, 25%?
Formal “Investment Strategy”/
R.I.P.
R.I.P.
IS IT ... WOW!?
“There is an internal and an external pressure to keep doing the same thing. People liked it.
You got rewarded. So do it again! The same only different. So it
becomes something you have to fight.”
Michael Crichton
R.I.P.10 … Major job change [new area of
concentration]; major offsite educational investment; extensive
sabbatical [oddball learning experience of > 2 months];
exceptional community project [presidency of fundraising drive, run
for school board].
R.I.P.
5 ... Extensive course work in oddball area of passionate interest; major off-
the-job activity [community involvement, learn to play the cello,
study Chinese].
1 … Company training, as directed.
R.I.P./Practical Step No. 1
Go some place totally different for vacation!
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.
[ Training Y2K
Anytime, anywhere!
Whatever!
Concocted by the employee/
“Training Account”]
Assignment!
Construct a 1/8-page or 1/4-page ad for
Brand You … for the Yellow Pages
[ How About It?
Replace your current evaluation process with
Yellow Pages ads.]
Bill Parcells’ World/ Brand You World!
BLAME NOBODY!EXPECT NOTHING!DO SOMETHING!
Source: NY Post
It’s Attitude, Baby!
9-10, 4.23
10-1, 1.28
Seminar Y2K
Message:
Distinct … or Extinct!
“Everything can be taken from man but one thing: the last of human freedoms - to choose
one’s own attitude in any set of circumstances, to choose
one’s own way.”Victor Frankl, Auschwitz survivor
2 folks in Hartford …
MY ONLY GOAL - AS YOUR BOSS - IS TO HELP YOU DECIDE WHAT TO MAKE OF
YOUR LIFE!
There comes a time in everyone’s life when they realize
they work for a dead guy.
FreeAgent.com [ad]
Brand Inside
PSF 4:Brand Talent!
Issue Y2K
The Great War for Talent!
“Develop people quickly and effectively” … 5%
“Truly know who our strongest and weakest performers are” … 17%
Source: War for Talent research/ McKinsey & Co.
“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.”
A Connoisseur of Talent …
– Spends time on Talent!
– Becomes a student of Talent! – Puts Talent “on the agenda”!– Practices D.I.Y.– Uses Plain English! (If you want “sunny” … ask
for “sunny”!)– Creates Workspaces that foster energy,
entrepreneurship and creativity!– Recruits from oddball places! /
Recruits Oddballs!
“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!)
A Connoisseur of Talent …– Recruits M.I. (Gardner: Logical-mathematical,
linguistic, artistic, musical, bodily-kinesthetic, intrapersonal-self, intrapersonal-others)
–Recruits arts!– Becomes de facto C.D.O. (Chief Diversity Officer)– Turns the pay scale upside down! / Pays Talent!– Rewards & Promotes all on Talent
Development Skills!– Spouts the Gospel of Renewal! (R.D.A./ R.I.P.)
“Every school I visited was participating in the systematic suppression of creative genius.”
Gordon MacKenzie
“Where do good new ideas come from? ...
That’s simple! From differences. Creativity comes from unlikely juxtapositions. The best way to
maximize differences is to mix ages, cultures and disciplines.”
Nicholas Negroponte
Attributes of Those Who “Made” the 10th Grade History Book
–Committed!–Determined to make a difference!–Focused!–Passionate! –Irrational about their life’s project!–Ahead of their time/ Paradigm
busters!–Impatient/ Action Obsessed!
Attributes of Those Who “Made” the
10th Grade History Book –Made lots of people mad!–Flouted the chain of command!–Creative / Quirky / Peculiar!–Rebels!–Irreverent!–Masters of improv / Thrive on chaos/
Exploit chaos!
Attributes of Those Who “Made” the 10th Grade History Book
–Forgiveness > Permission
–Bone honest!
–Flawed as the dickens!
– “In touch” with their followers’ aspirations
–Damn good at what they do!
“Conformity is the enemy of freedom
and the jailer of growth.”
J.F.K.
Just Say “No” to “Grout”!
Participant: “Don’t you need ‘grout’ between the tiles?”
TP: “No!” [med staff, NFL Special Teams,waiters,
PFCs, cymbals player, bit parts, waiters]
[ TP’s Ideal Job:
Head of Housekeeping!]
“The boundaries for acceptable weirdness have
dramatically expanded.”
Michael Schrage
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]
Talent War Y2K!
–All out!/ Time consuming!–Never ending!/ Unwinnable!–Includes everybody!/ Everybody’s
game! (“We’re all in sales.”)–Expensive!–Cool!/ WOW!/ Fun!/ Creative!–Strategic!/ Core competence!
Talent = Brand
Brand Outside=
Brand Inside
“Emotional values are replacing physical attributes as the fundamental
market influence.”
“Only with a strong spirit at its foundation can a company achieve
strong market position.”
Jesper Kunde, Corporate Religion
PSF Y2K Final Exam– Are you working with awesome/freaky peers?– Are you working with cool/pioneering Clients?– Are you a “player”?– Are you pushing the envelope and putting yourself at risk on
every project?– Are you doing WOW work? – Are you having fun?– Are a lotta “theys” mad at you?– Will you look back on “all this” as “the time of your life”?
Brand Outside
Context:
No “Commodities”!
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, HP
“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, similar warranties and
similar quality.”
Kjell Nordstrom and Jonas Ridderstrale, Funky Business
The “10X/10X” Phenomenon
10 Times Better/
10 Times Less Different
TP’s Campaign Y2K
Just say [shout]
“No!” to the “inevitable
commoditization” of anything.
“When we did it ‘right’ it was still pretty
ordinary.”Barry Gibbons on
“Nightmare No. 1”
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
“We want to create waves of lust for our product.”
Andy Grove (on the Pentium Processor)
“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
Lust Hierarchy
Satisfy … Conform to Requirements … Exceed
Expectations …Delight! … WOW! … Lust! …
ONLY ONES WHO DO WHAT WE DO!
New Customer Offering at Virgin Must Be:
… of the best quality… innovative
… provide good value for money… challenge existing alternatives
… add a sense of fun or cheekiness
Source: Kjell Nordstrom and Jonas Ridderstrale, Funky Business
“customer satisfaction” to
“customer success”
Source: GE Power Systems
“We’re getting better at [Six Sigma] every day. But we really
need to think about the customer’s profitability. Are customers’
bottom lines really benefiting from what we provide them?”
Bob Nardelli, GE Power Systems
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!Bottom Line: 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!Bottom Line: 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
“The numbers [declining market share] don’t lie. Detroit’s single
biggest failure has been its unwillingness to innovate. It is less
risky to simply develop a new version of an existing product than to pioneer
a new category.”
Alex Taylor (Fortune)
[ Again:
BRAND OUT = BRAND IN
HIRE DULL … GET DULL!]
Benchmarking, Perils of …
“The best swordsman in the world doesn’t need to fear the second best swordsman in the world; no, the person for him to be afraid of is some ignorant antagonist who has never had a
sword in his hand before; he doesn’t do the thing he ought to do, and so the expert isn’t prepared for him; he does the thing he ought not to do and often it catches the expert out
and ends him on the spot.”
Mark Twain
Lead customers!
K2K redux!
Amen!
“The Age of the Never Satisfied
Customer”Regis McKenna
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!Bottom Line: Glorious Age of the
BRAND!
Brand Outside
Strategy 2:Master
E-Commerce!
$30,000,000. = ???
Dell’s Web sales … daily
350,000 = ?????
New items going on sale at eBay …
daily (12-99)
2X = 100 days (Internet traffic)
2X = 9 months (network capacity)
Source: Red Herring (1-00)
Tomorrow Today: Cisco!
$7B of $10BSave $500M (service and tech
support)
C.Sat e >> C.Sat HCustomer Engineer Chat
Rooms ($1B?)
And Larry?
Business 2.0: “20 Industries About To Be Fossilized by The Net” (3-99)
Travel Agents ($2B now, $30B in 2003); Apparel (1-21); Autos (4-213);
Home Electronics (1-21); Paper and Office Supplies (1-65); Food (<1-54); Utilities (7-170); Computing (20-400);
Newspapers ($5B of $19B classifieds)
Cherry PickingVertical Markets
Plasticsnet.com: $370B; sellers pay $5K to $8K for
“storefront”; 5% to 10% cut
Hook: community services (database, catalogs, forums, industry job bank,
etc.)
W.W. Grainger*
2X phone/fax
*$220B “MRO” market (per Business 2.0/02-00)
B2B
1999 – 2004: 50X
2004: $7.4Source: GartnerGroup (per Reuters 1-26-00)
T
Consumer [Health Care] Sovereignty!* E.g.:
“Empowered consumers influenced by medical advertising and educated by
information on the Internet are driving demand for new vision correction
options.”
Start Up (10-99)
* “Take your White Coat and … ”
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
“Autoweb. Take the Wheel.” Advertising Age
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”
“IT enables total transparency. People with
access to relevant information are beginning to challenge any type of
authority. The stupid, loyal and humble customer, patient, employee
or citizen is dead.”
Kjell Nordstrom and Jonas Ridderstrale, Funky Business
Patricia Seybold’s “Basics”:The E-Customer Bill of Rights
Don’t waste my time!Remember who I am!
Make it easy for me to order and procure service!
Customize your products and services for me!
Source: customers.com
“Welcome back, Tommy!”
“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
Read This. No: INGEST This!
Jakob NielsenDesigning Web Usability:
The Practice of Simplicity*
*www.useit.com
“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!
Link … madly!
Nielsen/ Continued
Must work … on a small screen!Must work … w/o graphics loading!
“Scannability” rules! [Users pick out key words.]
Navigation page: No scrolling!
Remember: 25% to 50% “successful use”
“When you click on Yahoo! today you get the same
simple, nearly graphics-free home page you would have seen had you clicked three
years ago.”Fortune, on Zod Nazem,
Yahoo! CTO
“Where does the Internet rank in priority?
It’s No. 1, 2, 3, and 4.” Jack Welch
Web Strategy: GE Power Systems
“Launch and Learn”/4 sites in 30 days
Goodhome.com / 10 weeks!
Change … Or Die!
“Most of the brick and mortars look at the Internet as an add-on business … until they get a major scare. Then they either
change or die. … You have to put all your heart and soul in that direction, the way
Charles Schwab and Dell did.”
Flip Filipowski, divine interVentures (Red Herring)
“I have this chance for … changing the world.”
Marco Boerries, Sun, re StarOffice (Business 2.0, 2-00)
There are 2 Kinds of …
Defense*
vs.
Offense**
*Fend off upstarts.**Reinvent our marketspace!
Mags
Advertising AgeBusiness 2.0
Fast CompanyRed Herring
Scientific American Wired
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!Bottom Line: 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.
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)
$3.3T + $1.5T = $4.8T*
* Larger than Japan!
Most Under-reported story!
9M*/20M+/$4T [> Germany]
* 400K in ’72; 132% since ’92;source: NFWBO, Cognetics
New golfers … 37%Basketball … 13.5M
1 in 27 (’70) … 1 in 3 (’96)
1874?
1874 … Jock Strap1977 … Jogbra
1977 ... 25K
1996 … 42M
Yikes? Ho-hum?
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.”
“Men seem like loose cannons. Men always move faster through a store’s
aisles. Men spend less time looking. They usually don’t like asking where things are.
You’ll see a man move impatiently through a store to the section he wants,
pick something up, and then, almost abruptly he’s ready to buy. … For a man,
ignoring the price tag is almost a sign of virility.”
Paco Underhill, Why We Buy* [*Buy this book!]
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
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
Marketing to Women: Help Them Save Time!
80% … work86% … cook
58% … run errands with kids38% … take child to school
21% … go to the gym21% … take outside classes
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 Sternberg/ IBM
[“The Net hasn’t lived up to its hype. It’s a distant, cold, alien,
threatening world called ‘cyberspace.’ The challenge is to
make the Net into something intimate, warm, friendly, useful,
personal.”Carly Fiorina, CEO, HP @ Comdex ’99]
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
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
Top 25 Cos. For Executive Women/Working Woman/1Y2K
Avon … Chas. Schwab … Scholastic … Fannie Mae … Dayton Hudson … Knight Ridder … Pitney Bowes …
Advantica … Gap … Nordstrom … Sallie Mae … Gannett … Golden West … Aetna … Mattel … IBM … SBC Comm. …
Merck … State Street Corp. … Sara Lee … Prudential … Baxter … P&G …
WellPoint … Xerox
Speaking of Enormous
[Missed] [Huge] Opportunities ...
74M/ Front Edge: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!”“Experiences” vs. Products
Design revolution!
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!Bottom Line: 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
that ends up expressing itself in successive outer layers of the product or
service.”Steve Jobs]
Check Out the Language:
“Tomorrow it’s design …”“Design is the only thing …”
“Design is … religion ...”“Drop-dead charm …”“Object of desire …”
“Soul …”
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
One-sixth Second per Item!
“During the 30 minutes you spend on an average trip to the supermarket,
about 30,000 products vie to win your attention and ultimately to make you
believe in their promise.”
Thomas Hine, The Total Package
[ Design Moments!
Shopping cart =
2X heavy items
Source: Wall Street Journal (11-24-99) ]
“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
Message:Services are Not Intangible!
You “give off” hundreds of design cues … daily!
YOU ARE A DESIGNER!
Graceful language!
Susan Sargent Designs:
PLEASE COMPLAIN!Thanks for your order!
We dearly want everything to go p-e-r-f-e-c-t-l-y!
If the order was late. Or wrong.Or if any of the goods are damaged in the
slightest.Or if you’re just having a lousy day and
want to unload on someone …
Call our Customer Care Hotline!
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.
WEB Words: TP
NO CLUTTER!
No Clutter! CNNSI.com developed an increasingly common
problem. In the midst of adding material, its design went bad. CNNSI became so packed with links, new sections and graphics that it actually became hard
to find something as basic as the score of last night’s ballgame. Then it got worse. The team tried
to make new graphic elements eye-catching enough to stand out from the site’s clutter. But the surfers
ignored them, thinking they were ads.”Business Week [9-99]
Huge Opportunities [ That Damn Few Are Pursuing! ]
Women!The rapidly aging population!
Design!
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!Bottom Line: 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
“What’s the plot?”
Freeman Thomas, designer
“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
Safe, On Time and …
“We defined personality as a market niche. We seek to
amuse, to surprise, to entertain.”
Herb Kelleher, Main Man, LUV Airlines
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
“Cars are not simply to get you from place to place. They ought to be entertainment. We are sort of in
the entertainment business.”
J Mays, Ford
“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
[Experiencing:#1 Oxymoron:
Respect … from an Airline!
I can cope with delays. I cannot cope with lies … especially Sins of
Omission.
IT IS DISRESPECTFUL TO ME AS A HUMAN BEING!!]
Marketing Aesthetics
“managing aesthetics experiences” … “aesthetics strategy” … “marketing of
sensory experiences that contribute to the organization’s or brand’s identity” … “mapping strategic vision to sensory
stimuli”
Source: Marketing Aesthetics, Bernd Schmitt & Alexander Simonson
Look + Feel + Taste + Touch + Sound + Smell +
Texture + Color + Typeface + Etc. = EXPERIENCE*
* Bernd Schmitt & Alexander Simonson, Marketing Aesthetics
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!Bottom Line: Glorious Age of the
BRAND!
Brand Outside
BRAND POWER!
Brand?
DistinctionExcellence
Emotional “Signature”Trustworthiness
ConsistencyShorthand
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
“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
Calling the Corporate Shrink!
“Organizational Psychotherapy”/
WHO WE ARE!
Scott Bedbury/ Nike, Starbucks
“A Great Brand taps into emotions. Emotions drive most, if not all, of our decisions. A brand reaches out with a powerful connecting experience. It’s
an emotional connecting point that transcends the product.
“A Great Brand is a story that’s never completely told. A brand is a metaphorical story that’s evolving all the
time. This connects with something very deep - a fundamental appreciation of mythology. Stories
create the emotional context people need to locate themselves in a larger experience.”
“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
“Corporate Religion is a completely new way of thinking about companies. Today, the product is still the main communication
highway in the company. When companies make the shift to selling solutions, brands and attitudes … communicating the company’s
attitudes and values becomes the decisive parameter for success. It
demands that you find out who you are as a company.”
Jesper Kunde, Corporate Religion
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
[“Dare to be different. Make people notice. The world is
brimming with new competitors and look-alike products. How do
you stand out?”
James Daly, Editor, Business 2.0]
Brand = Special = Passion =
Connection = Caring*
* (Way) beyond “market research”
“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
The Ten Rules of Radical Marketing
CEO must “own” the marketing function!Hyper-lean Mktg. Dept. (No filters!)
CEO hangs out with customers!Love + Respect your customers!
Just Say No … to market research!Hire only passionate missionaries!
Create a Community of users-customers!Emphasize one-to-one marketing tools!
Celebrate craziness!Be insanely True to the Brand!
Sam Hill & Glenn Rifkin, Radical Marketing (e.g., Harley, Virgin, The Dead, HBS, NBA)
P.S.: All this applies to the Finance Department*
*Now: Finance Inc.
T.T.D. #1: “How can I know what I
think until I see what I say”*
Exercise : Write copy for a bookmark! (Etc.)
*Graham Wallas, The Art of Thought
Brand Leadership
Lead Out Loud!
Live the Brand!
ENTHUSIASM RULES!*
“I am a dispenser of enthusiasm.”
Ben Zander*TP on Bob Nardelli/GE Power Systems
“Astonish me!” S.D.
“Build something great!” H.Y.
“Immortal!” D.O.
“Leadership is a performance. You have to be
conscious of your behavior, because everybody else is.”
Carly Fiorina
“If you want to be persuasive, you have to generate a high level of energy. It’s energy that makes you visible, that gives you
presence. I call it ‘performance energy,’ and it’s the basis of dynamic leadership.
There is nothing artificial about it. Performance energy is an authentic part of who you are. You
just have to access it.”
Martha Burgess, Theater Techniques for Business People
Ann R.’s Gospel– Show up!– Know your message!
–Put yourself at risk!
BE ASHAMED TO DIE UNTIL YOU HAVE
WON SOME VICTORY FOR HUMANITY!
Horace Mann, founder, Antioch College
“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
“If you ask me what I have come to do in this world, I
who am an artist, I will reply, I am here to live my
life out loud.”Emile Zola
“I’d rather regret the things I have done than the things I have not.”
Lucille Ball
“If things seem under control, you’re just
not going fast enough.”
Mario Andretti
THE END