I give keynotes, - Purdue Krannert · •Changed distribution costs ... their American and European...
Transcript of I give keynotes, - Purdue Krannert · •Changed distribution costs ... their American and European...
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Slides are ©Essential Ideas, Inc.Photographs are copyright by their
ownersAll Rights Reserved
Educational Use OnlyMay not be reproduced
I give keynotes, innovations sessions
and after dinner speeches
contact Keppler Speakers
CutCosts!
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“Never, ever, think outside the box!”
Consumer Empowerment
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16
.COMmunist?Revolutionize businessMake the old worldobsolete...overnight
• Travelocity changed an industry• Over 60% of travel is booked
online today• Online travel will grow to
almost $150 billion by 2010• Travel is larger than the next
four categories of eCommerce combined!
Growth/Change Putting travel online changed...•Changed how the product was priced•Changed how the product was distributed•Changed distribution costs•Changed market share
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• 34 million members• 1200 employees• Public company • Profitable .com• $3.3 billion in bookings
$10 billion today
Our IPO
Just how fresh are these Insights?
carto
onba
nk.c
om
• Security• Search• Vertical search• Advertising• Access• Travel• Accommodations• Venture capital• Expert Witness• Consulting
Been busy...
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Over 500 .com’s dead in 2 years
100,000 jobs created then DESTROYED
The tendency of STUPID IDEAS toseem smarter when they come
at you rapidly!
Many were taken in by The Dopeler Effect
They failed for many reasons
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They didn’t learn how to take this type of relationship,
to this one
2007
2008
2009
2010
2011
$172.00
$191.00
$210.00
$220.00
$250.00
eCommerce bigger than ever
$155.00
Technique
Technologyfollows Alexander Graham Bell thought the
telephone would be a tool for the Deaf
Thomas Edison thought the Phonograph
would be a Dictation Machine
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The invention of the long rifle
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Byline: Bill Husted
About 1,300 of EarthLink's 3,300 employees learned Tuesday they will lose their jobs by late March in a dramatic work force reduction by the Atlanta-based Internet provider.
The 39 percent work force reduction comes as EarthLink closes call centers across the country. Those centers handle customer service and technical support calls from EarthLink subscribers -- duties that will be shifted almost entirely to outside companies, located both in the United States and overseas.
!"#$%&'()&($*+,-)('./+)0&1&,&1+)
EarthLink to Cut Jobs by 39 Percent.
Wednesday, January 7, 2004
!"#$%&'()&($*+,-)('./+)0&1&,&1+)
By SARITHA RAIPublished: October 12, 2005
BANGALORE, India, Oct. 11 - India's two largest outsourcing companies, Tata Consultancy Services and Infosys Technologies, announced healthy growth in quarterly profits on Tuesday, indicating that Western corporations continued to vigorously outsource technology and back office operations.
India's $17.2 billion outsourcing industry is flourishing as companies hire skilled yet inexpensive English-speaking programmers and call center workers to carry out technology projects and provide customer support for their American and European clients.
Wednesday, October 12, 2005
Western Outsourcing Lifts Profits at Two Indian Companies
Martin Cooper
He had no idea
255 million phones in the U.S.
2.1 trillion minutes
Found cell reception 3 miles offshoreCheck market prices via SMSChoose port based on priceGain market power!
Kenyan Fisherman
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80% of all home buyers search online1/3 of stocks are sold online
44% of online American’s bank online150 million travelers search online
Now, we are getting the technique
“Technology Is Whatever Didn’t Exist When You
Were Born”-Alan Kay
Born at the keyboard81%of Teens use the Internet-Pew Internet Trust
21 hours per week!
20% of 6-11 Year OldsHave Cell Phones!
98% of college students have purchased online!
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Sales projected to decrease 40% in next 4
years!
You won’t get him with this... 73% of college students online daily!
The New Readers
©New York Times
Today’s graduates are tomorrow’s employees…& internet key totheir relationships
We are wired
We have little time
We want to click and goWe buy food at the gas station
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We take pictures with telephones We eat meals in the car
We buy lettuce in a bag We bank in Grocery Stores
Even Windex multi-tasks
75% of laptop ownerstake them on VACATION!
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47% of US shoppers have shopped in pajamas
We live a world driven by speed and convenience
It is a wired worldUS Population
27% offline
73% online
-Internet World Stats78% of those 18-39
Choice happens instantly Location, Location, Location? Not heree...Wherever your competitor is…
he’s only1/8 of a second away
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Death of distance World is your Market
World is your Competitor
Transparency
Information
Information
Information has found
FREEDOM
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Information everywhereBuyer experiences are shared
“the shower is filthy”
Balance of Power
Sellers BuyersSellers
Buyers
Power to the customer
• Geographic barriers eliminated• Price information everywhere• Buyer experiences shared
Gartner
“If you don’t like change, you’re going to like
irrelevance even less.”-General Eric Shinseki,
Former Army Chief of StaffSecretary Veterans Administration
SHORT CIRCUITS
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Traditional Conversation
Travel Agent Airline
CustomerCustomer
18,000Agencies
gone
Short Circuit Traditional Conversation
Record Store
CustomerCustomer
Record Company
Sales down 25% last year
Short Circuit
SHORT CIRCUIT REWIRED
CustomerCustomer
Dealer Manufacturer
Customer
REWIRED
“Somewhere out there is abullet with your name on it.
Shot by a competitor, unknownand unborn, who will renderyour BUSINESS obsolete!”
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“Somewhere out there is abullet with your name on it.
Shot by a competitor, unknownand unborn, who will renderyour BUSINESS MODEL
obsolete!”
Bookstore
Record Store
Movie Theatre
NewspaperClassifieds
Yellow Pages
Encyclopedia
TraditionalBarnes & Noble
Best Buy
Megaplex
-Competing
Books
Encarta
Selection &Price
Amazon
CD Now
Netflicks
Ebay
Big Yellow
Encarta O/L
OnLineKindle
Ipod
You Tube
Craig’s List
Angie’s List
Wikipedia
Speed &Convenience
UserGenerated
New opportunity lies where old models are crumbling
Successful leaders must recognize that, customers are…
Internet Empowered and Tech Savvy Time Starved Information Rich
Face To Face No Longer Enough The phone is no longer enough
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Build digital relationships Innovation!
SUCCESS
What’s behind success?
Invention
VS
Innovation
Invention• “A new device, method, or process developed
from study and experimentation”!Wikipedia
Innovation“Introduction into the marketplace of something new"
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They probably understand the size of the opportunity
Some will get it no matter how hard
Some can’t figure it outSome are afraid to go for it!
So, if you want successA few ideas
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Where Does Innovation Start?At The Top?
Top Had The Information! Big innovation from the top
Anywhere on the pyramid
Everyone has information
From the bottom
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Bozone Layer
Stops bright ideas from moving upwards
Employees
Biz Partners
Customers
Consultants
Internal R&D
10% 20% 30% 40% 50%
Sources of ideas
Forrester
“Don’t worry about people stealing your idea. If its
original you’ll have to cram it down their throat!”
-Howard Allen
Create a culture of innovation
Nurture the flame
This is NOT the Olympics
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This is BASEBALL
“Success isn’t permanent and failure isn’t fatal ”
-Mike Ditka
You’ve got to experiment
Writer Editor
35% More
A/B/C/D Testing!
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Experiment Fail Fast!
Don’t wait for the train wreck
Keep Tweaking
Auctions Stores
Play To Your Strengths
A community of book lovers
Decided to sell used books!
• Don’t have to acquire the book
• Store the book
• Pick, pack and ship the book
• Margins are almost equal to new!
Don’t punish...learn
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CD RomEarly on we built a CD Rom based travel product
Spent $1 million dollars
Lost $1 million dollars
“What did you learn?”
Everyone needs a coach
“Successful innovation...pitilessly rejects bad ideas when their
promise is exhausted”Jason Pontin,
Editor, MIT Technology Review
Allow failure
Goffee & Jones HBR
When Genetech’s Research Review Committee kills a project…•No one is fired• They are asked what
they’d like to do next!
“We allow failure...and harvest learning”
Scott Cook,Founder, Intuit
“We encourage our employees to go down blind alleys and
experiment”Jeff Bezos
Amazon.com
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It’s all about the team This New World requires Old World knowledge mixed with youthful exuberance
Earrings & Orange HairThis Industry is brokenOnly we can fix itMessianic ZealNo Industry KnowledgeNo Industry Contacts
.com .corp.corpse
Staffing
SuitsIndustry Is FineDoesn’t Need FixingSlow PaceDomain Expertise
A Balance of views
• Old Dogs - New Tricks
• New Dogs – Old Tricks
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People who don’t fit in?
“The world wants Geniuses. It just wants them to behave like
other people!”-Gordon Moore
- Martin Sorrell, CEO WPP
They don’t want to be led
“If you want them to turn right, tell them to turn left!”
Keep teams small
One Persistent Guy Beat Us
Doubled Their Sales!
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Listen!
In A New Way
Listen To Your Customers!
• The Phone Booth Is A Symbol• Every person in every job
required to listen to two customer calls per month
• Must discuss root cause at staff meeting
Paul English, CTO Kayak.com
“Look Beyond What Is Immediately Apparent” E-Tickets
• “Our Customers Want Tickets”
• “What Will They Do For Receipts?”
• “They Will Never Accept This Idea”
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Oh Yea?
• 99% Etickets Last Month
A Self Service World
Innovation of crowds
“There is more than one right answer”
-Dewitt Jones
180 Degree Camera
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NewInnovative
“..the big prizes are found when you ask a question that
challenges the corporate orthodoxy..”
-Andrew Cosslettintercontinental hotels
Who reviews ideas?
• People in the department?
•Not in the department?
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•
Break the mold!
““ We bask in the coziness of our unimplemented insights!”
Remember....put it to work!
How To Create A Small Business Inside A Large One?
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It Isn’t Easy
StartupMentality
StartupMoney
Drag OnEarnings
ChallengeStatus Quo
You Can Succeed!
BIGthe good of
• You don’t need Venture Capitalists
• You don’t need their money
• You don’t require the types of returns they will demand
• You can draw on a large pool of employees for many skills
• It’s easy to get offices, computers, phones
• You can use their big name to open doors
BIGthe bad of
• You don’t get Venture Capitalists to help you!
• The corporate money comes at a price…
Endless
Numbing
Enveloping
Choking
Bureaucracy!
So what
to do?
Organization
Building a Startup in a Large Corporation
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To Do’s
What todo with
theInternet?
PresidentMarketing I.T. Manufacturing
PresidentMarketing I.T. Manufacturing
InternetCommittee!
To Do’s
What todo with
theInternet?
PresidentMarketing I.T. Manufacturing
PresidentMarketing I.T. Manufacturing
SeparateOrganization
PresidentMarketing I.T. Manufacturing
PresidentMarketing I.T. Manufacturing
InternetInternet
Team Culture
Reported to CEO
•C.E.O. Provided Substantial Air Cover
•Many Wanted Our Money
•Few Wanted to Help
•His Clout Was Necessary
•Supported Risk Taking and Failure
Leader (me)•Reported to C.E.O.
•Long Time Divisional Leader
•Had Sufficient Networking Relationship and Divisional Clout
Organization Location
•Moved to a Bankrupt Media Department Building that No One Wanted
•People Worked in Darkrooms and Sound Studios
• Took Almost One Year to Get the IT Guys to Move in as Well
•Had Spectacular Results
“Think outside the building!”
-Rosabeth Moss Kantor
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• Place engineers with customers
• Live in customers homes!
“Think outside the building!”
-Rosabeth Moss Kantor
• Find unsolved problems
Organization Location
Staffing
“We’ve found in companies that make good decisions, debate is real.”
- Jim Collins Built to Last
A Balance of viewsSome will leave
“Failure not an option”
Organization Location
Staffing Funding Funding•Budget Decided with CEO
•Little Debate Permitted
•Much Grumbling
•Later Actually Had Debate on Continuing
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Organization Location
Staffing FundingAir Cover
Great to have them help
• Their name opened doors
• Their buying power could help
• We stole great people
We hid behind themwhen we got in
trouble
Escape when it hurts
• Purchasing too slow and adversarial
• IT too expensive and risk averse
• Advertising didn’t know B2C
• Hiring only from insidemade us uncompetitive
•
When we askedfor stock options?
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EventuallyWe sorta ran away
• We didn’t user their
• PR, Advertising
• HR Systems
• Accounting Systems
• Dress Code
But I...
• Attended staff meetings
• Board meetings
• Beat our drum, beat them off with a stick, and sucked up when it was useful!
Sylvania LED Lighting Division
“I needed someone who wasa bit of a dreamer who could
navigate our system”-Geoff Hunt Sylvania
Organization
Turned the organizationon its side
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Do MORE with less
Consumers were getting
smarter
First they would search
Then go direct to buy
.com .com
Meta Search
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versus• 3000 People
•Growth Through Traditional Advertising
• Customer Service
• Travel Agent Model
• Supplier = or - !
• Profitable
• 100 People
•Growth Through search
•NO customer Service
• Search Model
• Supplier Support
•Highly Profitable
FUTURE?
What’s the number 2 search engine?
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Viral Advertising
Now they look like this
Cell phone parking?
1,000,000 Downloads
Behavior just like the desktop!
Social Media“Word of mouth at the speed of light”
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“Just sitting here waiting for Facebook to go away”
Blogging?
“I had my own blog for a while, but I decided to go back to just pointless,
incessant barking.”
Marketing used to
be a ONE WAY
Now it’s TWO WAY
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They’re involved and
engaged
Blogs, Wikis, p
odcasts, Reviews, Social
Networks, Bluetooth Boards, Shared Video
B 2 CBrand
Customer
B 2 We!
Brand
Customer Community
Kelly Moony
The Ants Have Megaphones!
“You can’t Control what people say about you on the web.
You can be a good Listener!”Advertising Age
“It’s not about a better mousetrap. It’s about more
pathways!”Carl WilgusPoconos
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A story about change
$300,000
These kids never met!The game was built
entirely online and through Internet Messenger and Chat
A Virtual Company
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Lessonslearned Technique
Technologyfollows
It’s a different world
It’s wired Where information has found freedom
Buyers have more power than ever
before
A world driven by...
Speed Simplicity Convenience
Create a culture of innovation
Culture Bozone Layer
Experiment
Experiment Measure
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Don’t punish - LearnFail Fast
Don’t Punish
Small TeamsBalance of Views
It is all about the team
Look/Listen
Look BeyondWhat’s Apparent
Play toyour strengths Organization Location
Staffing Funding
Air Cover
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“When we come to the edge of the known
world...we’re standing on the shores of the infinite.”
-Ronald Reagan
The way to avoid being marginalized
Is to draw your own margins
“The Future Is A Foreign Country.
They Do ThingsDifferently There”
Arthur C. Clarke
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21st Century M
arketing
Leadership in a wired world
Building an electronic
Distribution stra
tegy
Terrell Jones
Terrell B. Jones
Business of Innovation
terrellbjones