How to destroy a company, by Leo Apothek


How to destroy a company, by Leo Apotheker http://on.wsj.com/nMheVn

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Introducing today’s CMO, starring Rodney Dangerfield


Marketing.  Now there’s one of the most misunderstood business functions out there.  Are you one of those folk who, like Rodney, feel at times like “I don’t get no respect around here?”.  The CMO today lives in very sharkey waters, as the Aussies say.

Nice to carry that “C” on your resume or business card, but when things go wrong, marketing is most often the first to blame. When things go right…well…some of you marketers may confront a harsh perception that needs correcting.  After all, sales people sell things.  Product and engineering people build things.  Financial people keep score.  Marketing people?  Ask people in other functions to define what you do, and you’ll get a host of answers.  Make sure you have the right answer yourself, build your career around it, and perhaps you’ll avoid the fate of the average CMO whose job tenure at under two years!  Rodney never got any respect.  CMO’s should, but they need to earn it and deserve it.  Let’s start with a role definition.

For some, marketing is about brand, with a lower case “b”.  It’s about fluffier stuff under the umbrella of marketing communications…advertising, PR, website development, social media, collateral, lead generation, and maybe field marketing under the rubric of sales enablement.  This is part of the equation to be sure…the executional part…and works well when marketing is asked to provide a service function.  However, this isn’t seen as a serious content role, and it doesn’t buy you a seat at the executive table.  Rightly so.

For others, marketing encompasses brand and marketing communications plus…business strategy and planning catalyst, partner and channel marketing, competitive intelligence, database marketing, product marketing, product roadmap direction setting, pricing, industry and financial analyst relations, executive sponsorship roles for key clients, internal communications, and culture catalyst.  This is a serious role…a capital M Marketing role…a role equal to if not greater in importance to the success of the business than other peer functions around the executive table.  If marketing is about Brand, that B is a promise of value that is infused in everything your company (and ecosystem) does that touches a customer….which is just about everything.

After all, what is a business about.  Customers.  How do you get them?  Through an outside-in, market-centric perspective rooted in knowing who buys, what they buy, why they buy, when they buy, where they buy, what their alternatives are, what the buy is really worth to them, what will keep them coming back for more, what would they like to see in future products, what drives them to recommend and advocate…you get the idea.  All the various marketing roles described above come together through the connective tissue of customers.  That’s the business of the business, and it should direct everything your company does.  Marketing is rational and emotional. It is measurable.  It is accountable.  It is tangible, and yes, it is creative, artistic, insightful and innovative.  It is indeed art and science to the very best practitioners, and not everyone possesses that combination of left and right brain skills to be the best.

The CMO today faces more pressures than most in not only having to master all these skills, but the skill sets in demand are in a state of constant evolution.  Remember marketing ROI and accountability?  OK, now that is (hopefully) table stakes.  How about digital marketing?  Got that down? Social media? Know what it is, what it isn’t, and more importantly, where it is going?  Up on the latest tools and techniques for customer engagement?  Understand how to not only drive innovation but how to execute to business materiality?  Truly collaborating in your flattened organization and expanding ecosystem?  Getting to customer advocacy?  Achieving authenticity at a time when marketing = shill and proxy?

Whether you run marketing for a team of two or 2,000, this is what the role is all about.  Do it well, inspire, educate, maintain a sense of humor and perspective, and you will earn that respect.

 

Facebook vs Google: Paradigm Shift?


My, how the world of technology flies.  Was a time when Microsoft, Cisco, and Intel ruled the world.  Then some kid came up with the Mozilla browser, prompting a war with Internet Explorer.  The some other bright kids came up with a search engine named Yahoo!, only to be one-upped by some other sharp kids at Google.  Now Google is king in search, fighting the browser wars with Chrome, owns YouTube, and plays in eCommerce, mobile via the Android O/S, business apps software, et al.  But what about Facebook?

Here’s a private company that one-upped the mySpace gang with social networking and has grown to 750 Million active users, 70% of whom are outside the US, 50% of whom log in every day, with 2.5 Million websites integrated into the platform.  What’s happening here?

There is a paradigm shift in how people communicate.  Collaboration and networking are the drivers of personal and business interactions.  One to many and many to many interactions jibe with the ecosystems we all live within today.  Collaborative business networks are being erected to support our hyperconnected, hypertransparent world.

Google knows this…hence the advent of Google+.  Is Google equipped to kill off Facebook as Microsoft killed off Netscape?  Probably not.

Networking and interactivity are core to Facebook, as search is core to Google.  Facebook is better positioned to leverage its strengths in personal networking.  It may be able to win the business market with enterprise versions of Facebook, though a company down in Mountain Viewhas a keen eye on this market as well…Linked In.

Should be fun to watch.  Google is a great, highly entrepreneurial company not to be counted out of any battle today. The success of Android in overtaking the Apple O/S with an open, free platform attests to this.  Facebook is best poised to seize the opportunities in a collaborative model, and with estimated valuations of $150-300 Billion in an eventual IPO, the cash will be there.

What do you think?

MIddle Management: The New Center of Power


Where does work really get done in business today?  The execs at the top plan strategy, decide on M&A, manage Wall Street expectations, set the cultural tone, handle the senior exec to senior exec interactions, keep score, and do a fair amount of approving and vetoing.  The people at the bottom are learners and doers.  But the notion of top, middle, and bottom doesn’t jibe with where the center of powert really resides.  Middle management is therefore a misnomer.  Middle is quickly becoming top in how work gets done and success is achieved in  today’s business ecosystems.

 

Hyper-connected organizations demand flattened organizations, and need the support of new collaborative business networks. Decisions affecting business success and failure are happening in ecosystems, where peer and group interactions in real time dictate what gets done.  Traditional IT systems of record, while still useful as data archives, are giving way in importance to more dynamic collaborative systems that are finally beginning to take root in supporting how business really gets done.  This consumerization of IT portends the advent of enterprise YouTube, enterprise Twitter, enterprise Facebook, and the like in forms that meet enterprise requirements….with functionality that aligns with today’s middle management communication modalities.

In flat organizations, everyone is expected to think and act like a leader irrespective of increasingly anachronistic hierarchies.  Middle management “owns” the discrete products, services and solutions that are made and sold and supported in networks, and thus determines business outcomes.  Collaboration as a workstyle, so familiar to today’s teens and Millenials, underscores the fact that information is the currency of business and the free flow of information across networks drives what and how things get done.  Controlling information…a prerogative of senior management in many traditionally organized companies today…is a death nell strategy.  Similarly, holding approval and veto power at the top constrains decision making and speed while disempowered middle management. Platitudes from the top, such as “people are our most important asset” won’t cut it when supreme power is closely guarded  at the top.  While a select few decisions will still reside at the top, the vast majority of decisions belong in the middle underpinned by collaborative business systems as enablers.

As companies embrace the new realities, it is clear that the future of power resides in middle management.  Today’s forward thinking companies get it…others living in command and control hierarchies better get it soon.

Why Shared Values Are Your Key Business Differentiator


As Thomas Friedman articulated as early as 2005 in his book, The World is Flat”, we live in a hyperconnected, hypertransparent world that has fundamentally changed the nature of communications and commerce.  Information now flows freely…without boundaries…in real time with direct implications for how businesses are structured and how the people within those companies work.  The 20th century command and control structures that once served many businesses well are increasingly anachronistic, and people driven by rules and motivated by self interest and financial rewards are giving way to new models that unleash the power of people.

Businesses that are thriving today are embracing these new realities.   People are no longer assets to be treated as chattel or interchangeable parts.  They are individuals who are increasingly motivated by values and principles, and are seeking journeys of significance before financial rewards.  Gone are the days when WHAT a business provides serves as its source of sustainable differentiation, as today’s innovations are quickly copied and improved upon with lightning speed across the globe.

In a hypertransparent, hyperconnected world, principled behavior based on a common vision and shared values has taken center stage.  Customers expect companies to treat them as people, with service at a premium and a new source of competitive differentiation.  Service is about people treating people as people.  It demands that employees and their partners inherently want to do the right thing in the best interests of their customers, and are encouraged to make fast decisions often in gray areas where personally held principles rather than rules serve as their source of guidance.

Vertically integrated companies that dictate terms to a limited set of suppliers have given way to horizontally aligned ecosystems of individuals and companies.  Teams are becoming more project and task oriented given the need for diverse skills and rapid execution.  Such teams are quickly formed and disbanded, and under such conditions, productivity and goal achievement depends on behavior driven by a new moral and ethical code.

It begins with trust and a willingness to grant trust to others one barely knows…a situation fraught with risk and uncertainty at the outset.  Such trust lays the foundation for taking risks, and risk taking is a precursor to attaining that evry company seeks to achieve today…continuous innovation.  When there is trust and the encouragement of risk taking in business, people are able to innovate through inspiration and the pursuit of significance at both the individual and team level, and in such fashion, genuine progress can be realized.

Principled behavior in business now demands that we focus on HOW we do WHAT we do.  When we are driven by our values rather than rules, we are free to do the right thing.  We trust each other based on a shared mission and shared values.  We do what we inherently know should be done in any situation, because we are motivated by our ethics over blind obedience to systems and rules that are not our own.  Our principles define who we are, as individuals and as teams, and guide us as pursue journeys of significance benefit businesses and inspire its people.

When the people within companies exhibit principled behavior, their values serve as a basis for self governance and a driver of leadership behavior based on contributions rather than hierarchy.  This ultimately benefits customers who vote with not only their wallets but with voices that can escalate  and reach around the world with lightning speed.  We have all had to personally endure calls into customer service centers where we are confronted by an endless set of automated voice prompts, only to finally get a representative on the line who works off a script and follows a set of prescribed rules that invariably fail to meet our personal needs. How many times have you had to ask for a supervisor to “be heard”, and how terrific do you feel when that supervisor voluntarily does the right thing to meet your needs.

The principled company focused on HOW customers are served. Its people listen.  They are genuinely concerned about others.  They take a personal interest in solving problems in a principled way.  They operate on the basis of doing the right thing.  And they eliminate the need to escalate up to a supervisor…improving productivity, reducing costs, and earning customer loyalty and advocacy.

Examples abound today of companies who have clung to outdated business models, trusting that WHAT thy provide is enough to command and defend a market leadership position.  By focusing single-mindedly on WHAT they provide, they fail to encourage the principled behavior that defines HOW they compete and suffer the consequences.  Examples abound of the importance of working openly and collaboratively in an environment of trust and respect.  In the world of technology, the advent of open source systems based on crowdsourcing and collective efforts fueled by the pursuit of significance have unleashed a torrent of creativity and innovation that has threatened or toppled closed, proprietary systems.  Businesses that were able to compete based on asserting power and killing off rivals are giving way to those who value teamwork, partnership, enlisting the support of customers and partners, and operating on the principle of what one should do in any situation. Principles and ethics matter, and strong arm tactics do not serve a business well.

When issues arise that can have a bearing on a company’s reputation, principled behavior means  acting with integrity, owning and correcting problems because it is the right thing to do even when seemingly unprofitable.  The nature of PR has been fundamentally changed from corporate spin and attempts to paper over problems to the enlistment to customer support through honesty and corrective actions.  Today, authenticity is the new currency of business, and when a business fails to do the right thing in efforts to protect profits, our new world of transparency reveals any and all transgressions with swift and lasting punishment to those who try to deceive

The bar has been reset for companies across the world in HOW its people behave, and the need to exhibit the highest level of ethics and moral responsibility has cascaded into a genuine concern for the environment. Sustainability and the green movement have put the spotlight on the need for principled behavior.  As consumers have embraced recycling and energy conservation to protect the environment for generations to come, they have also translated these values into their shopping habits.  Start up companies such as Method used only recycled packaging for its US household products and won a huge instant following that has helped change the game in packaging.  Concerns about carbon emissions changed similarly changed the game in global logistics and supply chains, and ecosystems of companies that work together to produce and distribute products are operating based on principles held dearly by both their employees and their customers.  Cisco has been an early champion and pioneer in developing a green supply chain, and many others have followed suit driven by a set of shared values rather than rules-based cap and trade restrictions.

In summary, being principled in today’s flat, hyperconnected, and hypertransparent world is no longer optional.  While the pursuit of profit remains a core driver for businesses, HOW that profit is earned is taking center stage as the source of competitive differentiation.  Acting on the basis of a common vision and shared values as an ethical member of a larger ecosystem is increasingly becoming the standard for companies worldwide.  And creating environments where people work together as inspired teams on a mission of significance is determining which business will thrive today and tomorrow.

Back from the Dead


Burroughs-Sperry Rand and Honeywell.  Kodak and Polaroid.  DEC and Wang.  GM, Ford, and Chrysler. Eastern and Northwest Airlines.  Borders, Barnes and Noble, Businessweek and Newsweek. Blockbuster. Companies that were once dominant market leaders who are no longer.  Companies that once operated in cyclical growth markets, where markets are established and mature, and both customers and the categories remain the same.  Power shuffles back and forth among vendors in cyclical markets.

But the pace of change is merciless today, driving secular markets.  In secular markets,  a one time only market expansion occurs when a new category or new class of customers arises.  Usually fueled by technology, these changes require a new set of skills and metrics, and a whole new approach to planning.  Operationally driven planning approaches that look back at last year’s plan, set quotas for the coming year, ask for bottoms up input and reconciliations to form the basis of next year’s plan may work in cyclical markets, but are doomed to failure in secular markets.

The game changers indeed change the game…fast!  Apple, Facebook, and Google are obvious examples of secular market growth.  But what of today’s cyclical growth heroes?

24/7 Wall Street predicts 10 brands that will disappear in 2012.  They are: Nokia, Soap Opera Digest, mySpace, Corn Pops, Sony Ericsson, Sears, American Apparel, Saab, A&W, and Sony Pictures.  Yes, these companies are in trouble.  But are they all doomed, or back they be brought back from the media-pronounced dead?

Many can!  Think back to Cisco and Sybase, Agilent and Cognizant, Autodesk and Synopsis, Rackspace, Adobe, and Qualcomm to name a few.  Rather than doing the same old same old operationally-driven planning, these companies looked outside in.  They aligned around a common vision that meant something to people other than themselves.  They committed to a strategy aligned with a vision.  And they allocated resources in assymetrical ways to create customer success and drive out competitors.

Taking an outside in, market centric perspective, those who will come back from the dead will profile trends and opportunities that can create net new sources of wealth.  They will leverage the 5 hierarchies of power that Geoffrey Moore espouses:  category power, company power, market power, offer power, and execution power.

The most powerful of these is category power, which reflects demand for a class of products/services vs. other classes.  Think smart phones and cloud computing in contrast to desktop computers, email, and wireline phone services. Apple is on a prolonged tear by playing in high growth categories like smart phones, digital music distribution, and tablets.  Could Motorola have developed an iPod-like phone as a follow up to the Razr when it had the technology and know how to do so…well ahead of the iPhone?  Why did HP miss the Internet?  These are great companies with very smart, hard-working people and potentially powerful ecosystems.  Indeed the ties of the past, and doing the same old same old are comfortable but quite perilous pathways in secular markets.

I will talk more of the hierarchy of powers in upcoming blogs but for now, let me posit this.  You can can come back from the dead.  The fate of the “10 brands that will disappear in 2012” is not sealed.  It will take great leadership and some disciplined strategic planning from an outside-in, market-driven perspective, as well as a willingness to focus investments on innovations likely already in development…making big assymetrical bets.  I was there at Kodak in 1994 when digital imaging was an emerging area but 95% of the profits were coming from film, paper, and chemicals.  Did they bet the farm on digital, or dabble?  History can be a harsh teacher.