Tom Peters’
Re-Imagine!
Business Excellence
in a Disruptive Age
01.11.2004
Slides at …
tompeters.com
It is the foremost task—
and responsibility—
of our generation to
re-imagine our
enterprises, private
and public. —from the
Foreword, Re-imagine
“Uncertainty is the only
thing to be sure of.” —Anthony Muh,
head of investment in Asia, Citigroup Asset Management
“If you don’t like change,
you’re going to like
irrelevance even less.” —General Eric
Shinseki, Chief of Staff,
U. S. Army
“September 11 amounts to
World War III—the third
great totalitarian challenge
to open societies in the last
100 years.” —Thomas
Friedman/NYT/01.08.2004
“The world’s new dimension
(computers, Internet, globalization,
instantaneous communication, widely
available instruments of mass
destruction and so on) amounts to a
new metaphysics that, by empowering
individual zealots or agitated tribes
with unappeasable grievances, makes
the world unstable and dangerous in
radically new ways.” —Lance Morrow/Evil
“The World Must
Learn to Live with
a Wide-awake
China”
—Headline/FT/11.03
“Save the date.” Dennis
Kozlowski and Mark Swartz.
Martha Stewart. Scott Sullivan.
John Rigas. Walter Forbes and
Kirk Shelton. Frank Quattrone.
Richard Scrushy. Miscl. Enronnies
Source: Headline/Business Day/NYT/01.08.2004
“Behind Surging
Productivity: The Service
Sector Delivers. Firms Once
Thought Immune to
Boosting Worker Output Are
Now Big Part of the Trend” —
Headline/WSJ/11.03
“As Economy
Gains,
Outsourcing
Surges”
—Headline/Boston Globe/11.03
“14 MILLION
service jobs are in
danger of being
shipped overseas” —
The Dobbs Report/USN&WR/11.03/re new UCB
study
“WHAT ARE PEOPLE
GOING TO DO WITH
THEMSELVES?” —Headline/
Fortune/ 11.03 (“We should finally admit that we do not
and cannot know, and regard that fact with serenity
rather than anxiety.”)
“One Singaporean worker
costs as much as …
3 … in Malaysia
8 … in Thailand
13 … in China
18 … in India.”
Source: The Straits Times/08.18.03
“The proper role of a healthily
functioning economy is to destroy
jobs and to put labor to use
elsewhere. Despite this truth,
layoffs and firings will always
sting, as if the invisible hand of
free enterprise has slapped
workers in the face.” —Joseph Schumpeter
--79% of U.S. jobs in “structurally changed
professions” (“permanently eliminated jobs”)
(40K of 160K U.S. IBM)
--”As we trade we release more labor from the
service sector because our highly skilled and
highly paid workers lose their competitive
advantage. So we go to the next big thing. We
specialize in innovation. We develop new
products and start new industries.” (Erica
Groshen, labor economist Fed of NY)
Source: CNN/Money/01.07.2004
“There is no job
that is America’s
God-given right
anymore.”
—Carly Fiorina/ HP/
01.08.2004
“The world has arrived at a rare
strategic inflection point where
nearly half its population—living in
China, India and Russia—have been
integrated into the global market
economy, many of them highly
educated workers, who can do
just about any job in the world.
We’re talking about three billion
people.” —Craig Barrett/Intel/01.08.2004
+/The Boston Club:
Corporate Salute
(10.28.03)
“Either we modernize or
we will be modernized by
the unremitting force of
the markets.” —Gerhard Schroeder
You must become an ignorant man again
And see the sun again with an ignorant eye
And see it clearly in the idea of it.
--Wallace Stevens/“Notes Toward a Supreme Fiction”
“A California biotechnology
company has put the entire
sequence of the human genome
on a single chip, allowing
researchers to conduct on the
complex relationships between
the 30,000 genes that make up a
human being in a single
experiment.” —Page 1, Financial Times/10.03.2003
Sequenom/David Ewing Duncan/Wired11.02
“Sequenom has industrialized the SNP [single
nucleotide polymorphisms] identification
process.” “This, I’m told, is the first time a
healthy human has ever been screened for the
full gamut of genetic-disease markers.” “On the
horizon: multi-disease gene kits, available at
Wal*Mart, as easy to use as home-pregnancy
tests.” “You can’t look at humanity separate from
machines; we’re so intertwined we’re almost the
same species, and the difference is getting
smaller.”
“Help! There’s nobody in the
cockpit. In the future, will the
airlines no longer need pilots?”
Grumman Global Hawk/
24 hours/ Edwards to South
Australia
Source: The Economist/12.21.2002
“There will be more
confusion in the
business world in the next
decade than in any decade in
history. And the current pace of
change will only accelerate.”
Steve Case
“IT MAY SOMEDAY BE SAID THAT THE 21ST
CENTURY BEGAN ON SEPTEMBER 11, 2001. …
“Al-Qaeda represents a new and
profoundly dangerous kind of
organization—one that might be called
a ‘virtual state.’ On September 11 a virtual
state proved that modern societies are
vulnerable as never before.”—Time/09.09.2002
“The deadliest strength of America’s new adversaries
is their very fluidity, Defense Secretary Donald
Rumsfeld believes. Terrorist networks, unburdened by
fixed borders, headquarters or conventional forces, are
free to study the way this nation responds to threats
and adapt themselves to prepare for what Mr. Rumsfeld
is certain will be another attack. …
“ ‘Business as usual won’t do it,’ he said. His
answer is to develop swifter, more lethal ways to
fight. ‘Big institutions aren’t swift on their feet in
adapting but rather ponderous and clumsy and
slow.’ ”—The New York Times/09.04.2002
From:
To:
Weapon v.
Weapon
Org structure v.
Org structure
“Our military structure
today is essentially one
developed and
designed by
Napoleon.”
Admiral Bill Owens, former Vice Chairman, Joint Chiefs of Staff
“The organizations we created have
become tyrants. They have taken
control, holding us fettered, creating
barriers that hinder rather than help
our businesses. The lines that we
drew on our neat organizational
diagrams have turned into walls
that no one can scale or penetrate
or even peer over.” —Frank Lekanne Deprez &
René Tissen, Zero Space: Moving Beyond Organizational Limits.
“In an era when terrorists use satellite
US
gatekeepers stand armed
against them with pencils
and paperwork, and archaic
computer systems that don’t
talk to each other.”
phones and encrypted email,
Boston Globe (09.30.2001)
“Dawn Meyerreicks, CTO of the Defense Information Systems Agency, made
one of the most fateful military calls of the 21st century. After 9/11 … her office
quickly leased all the available transponders covering Central Asia. The
implications should change everything about U.S. military thinking in the
years ahead.
“The U.S. Air Force had kicked off its fight against the Taliban with an
ineffective bombing campaign, and Washington was anguishing over whether
to send in a few Army divisions. Donald Rumsfeld told Gen. Tommy Franks to
give the initiative to 250 Special Forces already on the ground. They used
satellite phones, Predator surveillance drones, and GPS- and laser-based
targeting systems to make the air strikes brutally effective.
“In effect, they ‘Napsterized’ the battlefield by cutting out the middlemen
(much of the military’s command and control) and working directly with the
real players. … The data came in so fast that HQ revised operating procedures
to allow intelligence analysts and attack planners to work directly together.
Their favorite tool, incidentally, was instant messaging over a secure
network.”—Ned Desmond/“Broadband’s New Killer App”/Business 2.0/
OCT2002
“The mechanical speed of
combat vehicles has not
increased since Rommel’s day,
so the difference is all in the
operational speed, faster
communications and faster
decisions.” —Edward Luttwak, on the
unprecedented pace of the move toward Baghdad
“Our entire facility is digital. No paper, no film, no
medical records. Nothing. And it’s all integrated—from
the lab to X-ray to records to physician order entry.
Patients don’t have to wait for anything. The
information from the physician’s office is in
registration and vice versa. The referring physician is
immediately sent an email telling him his patient has
shown up. … It’s wireless in-house. We have 800
notebook computers that are wireless. Physicians can
walk around with a computer that’s pre-programmed. If
the physician wants, we’ll go out and wire their house
so they can sit on the couch and connect to the
network. They can review a chart from 100 miles
away.”—David Veillette, CEO, Indiana Heart Hospital
(HealthLeaders/12.2002)
“If early soldiers idealized Napoleon or
Patton, network-centric warriors
admire Wal*Mart, where point-of-sale
scanners share information on a near realtime basis with suppliers and also produce
data that is mined to help leaders develop
new strategic or tactical plans. Wal*Mart is
an example of translating information into
competitive advantage.”—Tom Stewart,
Business 2.0
The New Infantry Battalion/
New York Times/12.01.2002
“Pentagon’s Urgent Search for
Speed.” 270 soldiers (1/3rd normal
complement); 140 robotic off-road
armored trucks. “Every soldier is a
sensor.” “Revolutionary capabilities.”
Find-to-hit: 45 minutes to 15 minutes
… in just one year.
“Armies are like plants, immobile,
firm-rooted, nourished through
long stems to the head” …
guerillas: “might be a vapour;”
fighting guerillas “like eating soup
with a knife”
Source: T.E. Lawrence
Eric’s Army
Flat.
Fast.
Agile.
Adaptable.
Light … But Lethal.
Talent/ “I Am an Army of One.”
Info-intense.
Network-centric.
“Float like a
butterfly.
Sting like a
bee.” —Ali
“To fight terrorism with
an army is like trying to
shoot a cloud of
mosquitoes with a
machine gun.”
—Review of Terror in the Name
of God/NYT/11.2003
“Rather than have massive armies
that people can go along and
inspect, it is now about having
rapidly deployable expediency
forces that can be dropped by
land, sea or air and with full
support.” —MoD official, on Defense Secretary Geoff
Hoon’s defense white paper (12.2003)
“We must not only transform our armed forces
but the Defense Department that serves them—
by encouraging a culture of creativity and
intelligent risktaking. We must promote a more
entrepreneurial approach: one that encourages
people to be proactive, not reactive, and to
behave less like bureaucrats and more like
venture capitalists; one that does not wait for
threats to emerge and be ‘validated,’ but rather
anticipates them before they appear and
develops new capabilities to dissuade them and
deter them.” —Donald Rumsfeld, Foreign Affairs
Eglin Flag: “100% AGAINST
ZERO DEFECTS”
“General, if you’re not having
accidents, your training program is
not what it should be. … You need
to kill some pilots.”
BOYD: The Fighter Pilot Who Changed
the Art of War (Robert Coram)
“Perfection is achieved only
by institutions on the point of
collapse.”
— C. Northcote Parkinson
OODA Loop/Boyd Cycle
“Unraveling the competition”/ Quick
Transients/ Quick Tempo (NOT JUST
SPEED!)/ Agility/ “So quick it is
disconcerting” (adversary over-reacts or
under-reacts)/ “Winners used tactics that
caused the enemy to unravel before the
fight” (NEVER HEAD TO HEAD)
BOYD: The Fighter Pilot Who Changed
the Art of War (Robert Coram)
“Fast Transients”
“Buttonhook turn” (YF16:
“could flick from one maneuver to
another faster than any aircraft”)
BOYD: The Fighter Pilot Who Changed
the Art of War (Robert Coram)
“Blitzkrieg is far more than lightning
thrusts that most people think of
when they hear the term; rather it was
all about high operational tempo
and the rapid exploitation of
opportunity.”/ “Arrange the mind of
the enemy.”—T.E. Lawrence/
“Float like a butterfly, sting like a
bee.”—Ali
BOYD: The Fighter Pilot Who Changed
the Art of War (Robert Coram)
F86 vs. MiG/Korea/10:1
Bubble canopy (360 degree view)
Full hydraulic controls (“The F86
driver could go from one maneuver to
another faster than the MiG driver”)
MiG: “faster in raw acceleration and
turning ability”; F86: “quicker in
changing maneuvers”
BOYD: The Fighter Pilot Who Changed the Art of War (Robert Coram)
“Maneuverists”
BOYD: The Fighter Pilot Who
Changed the Art of War (Robert Coram)
Thunder Run/3rd Infantry
Division/04.07.2004/”We wanted to
create as much chaos as
possible.”—COL David
Perkins/“Disorient and
demoralize”—DHR
I Believe …
1. Change will accelerate. DRAMATICALLY.
2. We will RE-INVENT THE WORLD IN THE
NEXT TWO GENERATIONS. (Business …
Health Care … Politics … War …
Education … Fundamentals of Human
Interaction.)
3. OPPORTUNITIES are matchless.
4. You are either … ON THE BUS …
or … OFF THE BUS.
5. I WANT TO PLAY! AND YOU?
“How we feel about the evolving future tells us who we
are as individuals and as a civilization: Do we search
for stasis—a regulated, engineered world? Or do we
embrace dynamism—a world of constant creation,
discovery and competition? Do we value stability and
control or evolution and learning? Do we think that
progress requires a central blueprint, or do we see it
as a decentralized, evolutionary process?? Do we see
mistakes as permanent disasters, or the correctable
byproducts of experimentation? Do we crave
predictability or relish surprise? These two poles,
stasis and dynamism, increasingly define our political,
intellectual and cultural landscape.” —Virginia Postrel,
The Future and Its Enemies
Successful Businesses’ Dozen Truths: TP’s 30-Year Perspective
1. Insanely Great & Quirky Talent.
2. Disrespect for Tradition.
3. Totally Passionate (to the Point of Irrationality) Belief in What
We Are Here to Do.
4. Utter Disbelief at the Bullshit that Marks “Normal Industry Behavior.”
5. A Maniacal Bias for Execution … and Utter Contempt
for Those Who Don’t “Get It.”
6. Speed Demons.
7. Up or Out. (Meritocracy Is Thy Name. Sycophancy Is Thy Scourge.)
8. Passionate Hatred of Bureaucracy.
9. Willingness to Lead the Customer … and Take the Heat Associated
Therewith. (Mantra: Satan Invented Focus Groups to Derail True
Believers.)
10. “Reward Excellent Failures. Punish Mediocre Successes.”
11. Courage to Stand Alone on One’s Record of Accomplishment
Against All the Forces of Conventional Wisdom.
12. A Crystal Clear Understanding of Brand Power.
I. NEW
BUSINESS.
NEW
CONTEXT.
The Leadership11
1. Talent Management
2. Metabolic Management
3. Technology Management
4. Barrier Management
5. Forgetful Management
6. Metaphysical Management
7. Opportunity Management
8. Portfolio Management
9. Failure Management
10. Cause Management
11. Passion Management
“Sir Richard’s Rules:
“Follow your passions.
“Keep it simple.
“Get the best people to help you.
Re-create yourself.
“Play.”
Source: Fortune/10.03
1. All Bets
Are Off.
<1000A.D.: paradigm shift: 1000s of years
1000: 100 years for paradigm shift
1800s: > prior 900 years
1900s: 1st 20 years > 1800s
2000: 10 years for paradigm shift
21st century:
1000X
tech
change than 20th century (“the ‘Singularity,’ a merger between
humans and computers that is so rapid and profound it
represents a rupture in the fabric of human history”)
Ray Kurzweil
“Asia’s rise is the economic event
of our age. Should it proceed as it
has over the last few decades, it
will bring the two centuries of
global domination by Europe and,
subsequently, its giant North
American offshoot to an end.”
—Financial Times (09.22.2003)
Vernor Vinge/Mr. Singularity
“The transition time from human
history to post-human singularity
time, Vinge thinks, will be
astonishingly short—maybe one
hundred hours from the first
moment of computer selfawareness to computer world
conquest.”—Esquire/12.2002
“We are at a pivotal point in
history. … We are at one of a
half dozen turning points that
have fundamentally changed
the way societies are organized
for governance.” —Philip Bobbitt, The Shield
of Achilles: War, Peace, and the Course of History
“There’s going to be a
fundamental change in the
global economy unlike
anything we have had since
the cavemen began bartering.”
Arnold Baker, Chief Economist,
Sandia National Laboratories
“In 25 years, you’ll
probably be able to get the
sum total of all human
knowledge on a personal
device.”
Greg Blonder, VC [was Chief Technical
Adviser for Corporate Strategy @ AT&T]
[Barron’s 11.13.2000]
“I genuinely believe we
are living through the
greatest intellectual
moment in history.”
Matt Ridley, Genome
“We are in a
brawl with no
rules.”
Paul Allaire
“Strategy meetings held once
or twice a year” to “Strategy
meetings needed several
times a week”
Source: New York Times on Meg Whitman/eBay
The Breaking of Nations:
Order and Chaos in the
Twenty-first Century
Robert Cooper (as interpreted by Tom Peters)
“This is a dangerous world and
it is going to become more
dangerous.”
“We may not be interested in
chaos but chaos is interested
in us.”
Source: Robert Cooper, The Breaking of Nations:
Order and Chaos in the Twenty-first Century
“What happened after 1945
was not so much a radically
new system as the
concentration and culmination
of the old one.” —Robert Cooper, on the Cold
War, from The Breaking of Nations: Order and Chaos in the
Twenty-first Century
“What has been emerging into the
daylight since 1989 is not a
rearrangement of the old system
but a new system. Behind this lies
a new form of statehood, or at
least states that are behaving in a
radically different way from the
past.” —Robert Cooper, The Breaking of Nations: Order
and Chaos in the Twenty-first Century
“The image of peace and order through a
single hegemonic power center [is
wrong]. … It was not the empires but the
small states that proved to be a dynamic
force in the world. Empires are illdesigned for promoting change. Holding
an empire together requires an
authoritarian political style; innovation
leads to instability.” —Robert Cooper, The
Breaking of Nations: Order and Chaos in the Twenty-first
Century
Read
This!
“The new century risks being overrun by both anarchy and technology. The
two great destroyers of history may reinforce each other. Both the spread of
terrorism and that of weapons of mass destruction point to a world in which
Western governments are losing control. The spread of the technology of
mass destruction represents a potentially massive redistribution of power
away from the advanced industrial (and democratic) states and toward
smaller states that may be less stable and have less of a stake in an orderly
world; or more dramatically still, it may represent a redistribution of power
away from the state itself and towards individuals, that is to say terrorists or
criminals. In the past to be damaging, an ideological movement had to be
widespread to recruit enough support to take on authority. Henceforth,
comparatively small groups will be able to do the sort of damage which before
only state armies or major revolutionary movements could achieve. A few
fanatics with a ‘dirty bomb’ or biological weapons will be able to cause death
on a scale not previously envisaged. … Emancipation, diversity, global
communication—all of the things that promise an age of riches and
creativity—could also bring a nightmare in which states lose control of the
means of violence and people lose control of their futures.”—Robert Cooper,
The Breaking of Nations: Order and Chaos in the Twenty-first Century
Reflect.
“The two systems—the
modern based on balance
and the post-modern based
on openness—do not coexist well together.” —Robert Cooper,
The Breaking of Nations: Order and Chaos in the Twenty-first
Century
“Before we can talk about the
security requirements for today
and tomorrow, we have to
forget the security rules
of yesterday.”
—Robert Cooper, The
Breaking of Nations: Order and Chaos in the Twenty-first
Century
China
Roars!
TomPeters/01.01.2004
“China has become a manufacturing hub for the rest
of the world in low-end labor-intensive goods—and
the rest of the world is becoming a manufacturing
hub for China in high-end, capital-intensive goods. …
China may be a threat to certain parts of the global
supply chain that rely on low-cost labor, but it
represents an even greater opportunity via
production-efficiency gains, economic welfare gains
and long-term dynamic potential. Its booming exports
are more than matched by booming industrial imports
and foreign investment opportunities. It has become
the new engine of global growth.”
Source: Glen Hodgson & Mark Worrall/Export Development Canada, in “China Takes
Off”, David Hale & Lyric Hughes Hale/Foreign Affairs/Nov-Dec2003
1990-2003: Exports 8X
($380B); 6% global exports
2003 vs. 3.9% 2000; 16% of
Total Global Growth in 2002.
Source: “China Takes Off”, David Hale & Lyric Hughes Hale/Foreign
Affairs/Nov-Dec2003
1998-2003: 45,000,000 layoffs in
state sector; offset by $450B in
foreign investment; foreign
companies account for 50+%
of exports vs. 31% in Mexico,
15% in Korea.
Source: “China Takes Off”, David Hale & Lyric Hughes Hale/Foreign
Affairs/Nov-Dec2003
50% of output from private
firms, 37% from state-owned
firms; 80% of workforce
(incl. rural) now in private
employ.
Source: “China Takes Off”, David Hale & Lyric Hughes
Hale/Foreign Affairs/Nov-Dec2003
Population growth = 1%;
two-thirds of housing
privately owned, 90% of
urban Chinese own a home
(vs. 61% in Japan)
Source: “China Takes Off”, David Hale & Lyric Hughes Hale/Foreign
Affairs/Nov-Dec2003
200 cities with
>1,000,000
population.
Source: “China Takes Off”, David Hale & Lyric Hughes
Hale/Foreign Affairs/Nov-Dec2003
200,000,000 unemployed; must
create 20,000,000 jobs per year
to offset layoffs; 400,000,000
elderly Chinese by 2030
(currently no pension funds).
Source: “China Takes Off”, David Hale & Lyric Hughes
Hale/Foreign Affairs/Nov-Dec2003
397,000,000 fixed phone
lines =
90X since 1989.
Source: “China Takes Off”, David Hale & Lyric Hughes Hale/Foreign
Affairs/Nov-Dec2003
2003: China-Hong Kong leading
producer in 8 of 12 key consumer
electronic product areas (>50%:
DVDs, digital cameras; >33.33%:
DVD-ROM drives, personal
desktop and notebook computers;
>25% mobile phones, color TVs,
PDAs, car stereos).
Source: “China Takes Off”, David Hale & Lyric Hughes
Hale/Foreign Affairs/Nov-Dec2003
“When the Chinese
Consumer Is King:
America’s mass market
is second to none.
Someday it will just be
second.”
—Headline, New York Times/12.14.2003
World economic
output: U.S.A., 21%;
EU, 16%; China, 13%
(2X since1991)
Source: New York Times/12.14.2003
“America, like everyone else, must get
used to being a loser as well as a gainer
in the global economy. In the end, the
21st century is unlikely to be the American
Century.” —”When the Chinese Consumer Is King”/New
York Times/12.14.2003.
“The notion that God
intended Americans to be permanently
wealthier than the rest of the world,
that gets less and less likely as time
goes on.” —Robert Solow, Nobel laureate in
economics/New York Times/12.14.2003
2. The
Destruction
Imperative.
“It is generally much
easier to kill an
organization than
change it
substantially.”
Kevin Kelly, Out of Control
C.E.O.
to
C.D.O.
“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
“Analysts said we don’t care about revenue,
just give us the bottom line. They preferred
cost cutting, as long as they could see 2 or
3 years of EPS growth. I preached revenue
and the analysts’ eyes would glaze over.
Now revenue is ‘in’ because so many got
caught, and earnings went to hell. They
said, ‘Oh my gosh, you need revenues
to grow earnings over time.’
Well, Duh!”
Dick Kovacevich, Wells Fargo (in ABA Banking Journal)
Forbes100 from 1917 to 1987: 39
members of the Class of ’17 were alive
in ’87; 18 in ’87 F100; 18 F100
“survivors” underperformed the market
by 20%; just 2 (2%), GE & Kodak,
outperformed the market 1917 to 1987.
S&P 500 from 1957 to 1997: 74 members of the Class of ’57 were
alive in ’97; 12 (2.4%) of 500 outperformed the market from 1957
to 1997.
Source: Dick Foster & Sarah Kaplan, Creative Destruction: Why
Companies That Are Built to Last Underperform the Market
“Mr. Foster and his McKinsey
colleagues collected detailed
performance data stretching back 40
years for 1,000 U.S. companies. They
found that none of the long-term
survivors managed to outperform the
market. Worse, the longer companies
had been in the database, the worse
they did.”—Financial Times/11.28.2002
Survivors
underperform.”
“It’s just a fact:
—Dick Foster
Rate of Leaving F500
1970-1990:
Source: The Company, John Micklethwait & Adrian
Wooldridge (1974-200: One-half biggest 100 disappear)
“Far from being a
source of comfort,
bigness became a code
for inflexibility.”
—John Micklethwait
& Adrian Wooldridge, The Company
“Good management was the
most powerful reason [leading
firms] failed to stay atop their
industries. Precisely because these firms
listened to their customers, invested aggressively in
technologies that would provide their customers more
and better products of the sort they wanted, and
because they carefully studied market trends and
systematically allocated investment capital to
innovations that promised the best returns, they lost
their positions of leadership.”
Clayton Christensen, The Innovator’s Dilemma
Forget>“Learn”
“The problem is never how
to get new, innovative
thoughts into your mind,
but how to get the old
ones out.”
Dee Hock
Success Kills!
“The more successful a
company, the flatter its
forgetting curve.”
— Gary Hamel and C.K. Prahalad
“When asked to name just one big merger
that had lived up to expectations, Leon
Cooperman, former cochairman of
Goldman Sachs’ Investment Policy
I’m sure
there are success stories
out there, but at this
moment I draw a blank.”
Committee, answered:
Mark Sirower, The Synergy Trap
“Conglomerates
don’t work.” —James
Surowiecki, The New Yorker (07.01,2002)
“MERGERS: Why Most Big
Deals Don’t Pay Off. A
BusinessWeek analysis
shows that 61% of buyers
destroyed shareholder
wealth.” —BusinessWeek/10.14.2002
Market Share, Anyone?
— 240 industries; Market-share leader
is ROA leader 29% of the time
— profit / ROA leaders: “aggressively
weed out customers who generate
low returns”
Source: Donald V. Potter, Wall Street Journal (15 June 1998)
“Acquisitions are about
buying market share.
Our challenge is to
create markets. There
is a big difference.”
Peter Job, CEO, Reuters
“Active mutators in placid
times tend to die off. They
are selected against.
Reluctant mutators in
quickly changing times are
also selected against.”
Carl Sagan & Ann Druyan,
Shadows of Forgotten Ancestors
“Survival of the Fittest Not the Fattest”/John Kay/FT03.27.2003
“I have heard it from people who make pharmaceuticals and from people who make
defense equipment. From executives in utilities and executives in advertising. Among
banks and law firms. .. They all expect their industry to develop the way the car
industry has. In an increasingly globalized marketplace, maturing industries will
become steadily more concentrated. Only a small number of big companies will
survive.
“There is one problem with these analogies. What is said about the motor industry is
not true.The peak of concentration in the automobile industry was reached in the
early 1950s and since then there has been a substantial decline. However you look at
it, small carmakers have been steadily gaining market share at the expense of large
ones. Back in the 1960s, the 10 largest carmakers had a market share of 85 percent;
today it is about 75 percent. Concentration has fallen, even though weak firms have
been repeatedly absorbed through mergers.
“As markets evolve, differentiation becomes steadily more important. Success in the
motor industry comes not from size or scale, but from developing competitive
advantages in operations and marketing those advantages internationally. The same
is true in pharmaceuticals and defense equipment, utilities and banking,
telecommunications and media.”
Lessons from the Bees!
“Since merger mania is now the rage, what lessons can
the bees teach us? A simple one: Merging is not in
nature. [Nature’s] process is the exact opposite: one of
growth, fragmentation and dispersal. There is no
megalomania, no merging for merging’s sake. The
point is that unlike corporations, which just get bigger,
bee colonies know when the time has come to split up
into smaller colonies which can grow value faster.
What the bees are telling us is that the
corporate world has got it all wrong.”
David Lascelles, Co-director of The Centre for the
Study of Financial Innovation [UK]
“The Industrial Revolution was about scale: vast
factory complexes, skyscrapers and railway
grids concentrating power in the hands of rulers
of large territories: not only responsible rulers
such as Bismarck and Disraeli, but Hitler and
Stalin too. But the post-Industrial Revolution
empowers any one with a cellular phone and a
bag of explosives. America’s military superiority
guarantees that such new adversaries will not
fight according to our notions of fairness: they
will come at us by surprise, asymmetrically, at
our weakest points.” —Robert Kaplan, Warrior Politics
TP on Acquisitions
1. Big + Big = Disaster. (Statistically.)
(There are exceptions; e.g., Citigroup.)
2. Big (GE, Cisco, Omnicom) acquires small/specialist = Good
… if you can retain Top Talent.
3. Odds on achieving “projected synergies” among Mixed
Big “cultures”: 10%.
4. Max Scale Advantages are achieved at a smaller size than
imagined.
5. Attacked by Big, Mediocre Medium marries Mediocre
Medium to “bulk up.” Result: Big Mediocrity … or worse.
6. Any size—if Great & Focused—can win, locally or globally.
7. Increasingly, Alliances deliver more value than mergers
—and clearly abet flexibility.
A Baker’s Dozen Merger Messages: Private Sector & DHS/BTSD
1. Attitude Rules: Opportunity or Pain in …
2. Unique time for Deep Re-assessment. (WE MUST RE-INVENT THE
ESSENTIAL IDEA OF HOMELAND SECURITY.)
3. THIS SORT OF THING ONLY HAPPENS ONCE EVERY SEVERAL
DECADES! (I.E.: Don’t blow the Main Chance!)
4. Avoid getting totally caught up in (necessary) details. (KEEP YOUR EYE
ON THE B-I-G OPPORTUNITY.)
5. Let’s assume you only hold this job for the next few months. MAKE A
DAMN DIFFERENCE EVERY DAMN DAY.
6. What happens in the next few months is the principal basis by which your
entire professional career will be judged.
7. How well (IMAGINATIVELY!!!) you do this matters to 280,000,000 Americans.
8. Every morning, say quietly to yourself, “GROW UP.” Forget Age Old Turf
Disputes. (TURF WARFARE IS OSAMA’s-TERRORISM’s NO. 1 OPPORTUNITY.)
9. Inclusiveness matters. Be incredibly careful about Respect & Involvement.
10. Score some Quick Wins. (Rudy’s Rule.) Needed: New Behaviors. Focus
on the Positives. (Bob’s Rule.)
11. BE INSANELY LAVISH IN PRAISE OF SMALL ACTS OF COOPERATION. (Be
publicly brutal to the smallest act of turf warfare.)
12. “GOOD” DECISIONS MADE TODAY BEAT “GREAT” DECISIONS DELAYED FOR
MONTHS. MOMENTUM & MORALE MATTER. DELAY = CANCER.
13. VISIBILITY RULES!
The [New] Ge Way
DYB.com
Top-performing Companies
“Extremely contentious
boards that regard
dissent as an obligation
and that treat no subject
as undiscussable”
—Jeffrey
Sonnenfeld, Yale School of Management
“Change the
rules before
somebody else
does.”
—Ralph Seferian, VP, Oracle
“Most of our
predictions are based
on very linear thinking.
That’s why they will
most likely be wrong.”
Vinod Khosla, in “GIGATRENDS,” Wired 04.01
The Gales of Creative Destruction
+29M = -44M + 73M
+4M = +4M - 0M
“The secret of fast
progress is
inefficiency, fast and
furious and numerous
failures.”
Kevin Kelly
RM: “A lot of companies in the
Valley fail.”
RN: “Maybe not enough fail.”
RM: “What do you mean by that?”
RN: “Whenever you fail, it means
you’re trying new things.”
Source: Fast Company
“The Silicon Valley of
today is built less atop
the spires of earlier
triumphs than upon the
rubble of earlier
debacles.”—Newsweek/ Paul Saffo (03.02)
“... natural selection is death. ... Without
huge amounts of death, organisms do not
change over time. ... Death is the mother of
structure. ... It took four billion years of
death ... To invent the human mind ...”
— The Cobra Event
Silicon Valley Success
[Failure?] 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
Axiom (Hypothesis): We have
been screwed by Benchmarking
… Best Practice … C.I./Kaizen.
Axiom (Hypothesis): We need
Masters of Discontinuity/
Masters of Ambiguity … in
discontinuous/ambiguous
times.
“Organize” for …
performance & customer
satisfaction.
“Disorganize” for …
renewal & innovation.
“Rose gardeners face a choice every spring: how to prune our roses. The
long-term fate of a rose garden depends on this decision. If you want to have
the largest and most glorious roses of the neighborhood, you will prune
hard. You will reduce each rose plant to a maximum of three stems. This
represents a policy of low tolerance and tight control. You force the plant to
make the maximum use of its available resources, by putting them into the
the rose’s ‘core business.’ However, if this is an unlucky year [late frost, deer,
green-fly invasion], you may lose the main stems or the whole plant! Pruning
hard is a dangerous policy in an unpredictable environment. Thus, if you are
in a spot where you know nature may play tricks on you, you may opt for a
policy of high tolerance. You will leave more stems on the plant. You will
never have the biggest roses, but you have a much-enhanced chance of
having roses every year. You will achieve a gradual renewal of the plant. In
short, tolerant pruning achieves two ends: (1) It makes it easier to cope with
unexpected environmental changes. (2) It leads to a continuous restructuring
of the plant. The policy of tolerance admittedly wastes resources—the extra
buds drain away nutrients from the main stem. But in an unpredictable
environment, this policy of tolerance makes the rose healthier. Tolerance of
internal weakness, ironically, allows the rose to be stronger in the long
run.”—Arie De Geus, The Living Company
Japan’s Science Gap *
Rice farming culture: uniqueness suppressed.
Gov’t control of R & D. Promotion based on
seniority. Consensus vs. debate. (U.S.: friends
can be mortal enemies.) Bias for C.I. vs. “bold
leaps.” Lack of competition and critical
evaluation (peer review). Syukuro Manabe:
“What we need to create is job insecurity rather
than security to make people compete more.”
*Hideki Shirakawa, Nobel laureate, chemistry
December 2000: Swiss House
for Advanced Research &
Education. Cambridge,
Massachusetts. Xavier
Comtesse: “You never hear a
Swiss say, ‘I want to change the
world.’ We need to take more
risks.”
“The Word(s)” on Vitality:
Gary Hamel
“Sell By” [jettison old crap]
Spin Out [support entrepreneurs]
Spin In [buy young firms]
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
2A. Yo, Jim .
Or:
The Case for …
Technicolor!
“intrepid, unprincipled,
reckless, predatory, with
boundless ambition,
civilized in externals but
a savage at heart.”
Herman Melville on JPJ:
“intrepid, unprincipled,
reckless, predatory, with
boundless ambition,
civilized in externals but a
savage at heart.” —from Evan
Thomas, John Paul Jones: Sailor, Hero, Father
of the American Navy
Huh?
“Humility: The Surprise Factor in
Leadership … bosses with Gungho Qualities and Charisma May Be
Out of Fashion” —Headline/FT/
re JCollins/10.03
Jim & Tom.
Joined at the
hip.
Not.
I. Good to Great
II. Built to Last
III. Quiet, Humble Leaders
I. Good to Great
II. Built to Last
III. Quiet, Humble Leaders
Good to Great: Fannie Mae …
Kroger … Walgreens … Philip
Morris … Pitney Bowes … Abbott
… Kimberly-Clark … Wells Fargo
Good to Great: Fannie Mae …
Kroger … Walgreens … Philip
Morris … Pitney Bowes … Abbott
… Kimberly-Clark … Wells Fargo
Good to Great: “Fannie Mae and
Freddie Mac receive as much as
$164 billion in implicit federal
subsidies but have done little to
increase home ownership or
reduce the cost of home loans,
according to a draft study by the
Federal Reserve.” —New York Times/12.23.03
(Average rate reduction is 7 basis points, or .07%)
SET
THE AGENDA.
Great Companies …
(Period.)
AGENDA SETTERS: “Set the Table”/
Pioneers/ Questors/ Adventurers
US Steel … Ford … Macy’s … Sears …
Litton Industries … ITT … The Gap …
Limited … Wal*Mart … P&G … 3M …
Intel … IBM … Apple … Nokia … Cisco
… Dell … MCI … Sun … Oracle …
Microsoft … Enron … Schwab … GE …
Southwest … Laker …People Express
… Ogilvy … Chiat/Day … Virgin … eBay
… Amazon … Sony … BMW … CNN …
T & B: Atari, DEC, WANG?
J vs. T: HP/Carly F?
I. Good to Great
II. Built to Last
III. Quiet, Humble Leaders
Built to Last v. Built to Flip
“The problem with Built to Last is that it’s a
romantic notion. Large companies are
incapable of ongoing innovation, of
ongoing flexibility.”
“Increasingly, successful businesses will
be ephemeral. They will be built to yield
something of value – and once that value
has been exhausted, they will vanish.”
Fast Company
Warren Bennis & Patricia Ward Biederman/
Great
Groups Don’t
Last Very Long!
Organizing Genius:
W.A. Mozart
1756 – 1791
HE CHANGED THE WORLD
AND
ENRICHED HUMANITY
“We are in a
brawl with no
rules.”
Paul Allaire
Forbes100 from 1917 to 1987: 39
members of the Class of ’17 were alive
in ’87; 18 in ’87 F100; 18 F100
“survivors” underperformed the market
by 20%; just 2 (2%), GE & Kodak,
outperformed the market 1917 to 1987.
S&P 500 from 1957 to 1997: 74 members of the Class of ’57 were
alive in ’97; 12 (2.4%) of 500 outperformed the market from 1957
to 1997.
Source: Dick Foster & Sarah Kaplan, Creative Destruction: Why
Companies That Are Built to Last Underperform the Market
“The difficulties … arise from the inherent conflict
between the need to control existing operations and
the need to create the kind of environment that will
permit new ideas to flourish—and old ones to die a
timely death. … We believe that most
corporations will find it impossible to
match or outperform the market without
abandoning the assumption of continuity.
… The current apocalypse—the transition from a state
of continuity to state of discontinuity—has the same
suddenness [as the trauma that beset civilization in
1000 A.D.]”
Richard Foster & Sarah Kaplan, “Creative Destruction” (The McKinsey Quarterly)
“The corporation as we know it,
which is now 120 years old, is
not likely to survive the
next 25 years. Legally and
financially, yes, but not
structurally and economically.”
Peter Drucker, Business 2.0
“But what if [former head of strategic planning
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 Nordström and Jonas Ridderstråle,
Funky Business
Jane Jacobs:
Exuberant
Variety vs. the Great Blight of Dullness.
F.A. Hayek: Spontaneous
Discovery Process.
Joseph Schumpeter: the Gales of
Creative Destruction.
I. Good to Great
II. Built to Last
III. Quiet, Humble Leaders
Huh?
“Quiet, workmanlike, stoic
leaders bring about the big
transformations.”--JC
Huh?
“Humility: The Surprise Factor in
Leadership … bosses with Gungho Qualities and Charisma May Be
Out of Fashion” —Headline/FT/
re JCollins/10.03 (TP: scribble: “Nelson, Wellington,
Montgomery, Disraeli, Churchill, Thatcher”)
Wellington
Nelson
Disraeli
Churchill
Montgomery
Thatcher
“Humble” Pastels?
T. Paine/P. Henry/A. Hamilton/T. Jefferson/B. Franklin
A. Lincoln/U.S. Grant/W.T. Sherman
TR/FDR/LBJ/RR/JFK
Patton/Monty/Halsey
M.L. King/C. de Gaulle/M. Gandhi/W. Churchill
Picasso/Mozart/Copernicus/Newton/Einstein/Djarassi/Watson
H. Clinton/G. Steinem/I. Gandhi/G. Mieir/M. Thatcher
E. Shockley/A. Grove/J. Welch/L. Gerstner/L. Ellison/B. Gates/
S. Jobs/S. McNealy/T. Turner/R. Murdoch/W. Wriston
A. Carnegie/J.P. Morgan/H. Ford/S. Honda/J.D. Rockefeller/
T.A. Edison
Rummy/Norm/Henry/Wolfie
Elizabeth Cady Stanton/Susan B. Anthony/Martha Cary
Thomas/Carrie Chapman Catt/Alice Paul/Anna Elizabeth
Dickinson/Arabella Babb Mansfield/Margaret Sanger
“You can’t behave in a calm,
rational manner. You’ve got to
be out there on the lunatic
fringe.” — Jack Welch,
on GE’s quality program
“Roosevelt’s duplicity, Churchill’s
self-absorption” … “We are all
worms. But I do believe that I am a
glow-worm.” (WSC) … “Imperial
and bold” [WSC and TR] …
“arrogance and instability” …
“rough, sarcastic, bullying”
Source: Jon Meacham, Franklin and Winston, et al.
“a vainglorious selfpromoter spoiling for
a fight”
—Arthur Koestler on Galileo
Herman Melville on JPJ:
“intrepid, unprincipled,
reckless, predatory, with
boundless ambition,
civilized in externals but a
savage at heart.” —from Evan
Thomas, John Paul Jones: Sailor, Hero, Father
of the American Navy
Audie Murphy was the most
decorated soldier in WW2.
He won every medal we had
to offer, plus 5 presented by
Belgium and France. There
was one common medal he
never won …
… the Good
Conduct medal.
“Men with no vices
have very few
virtues.” —A. Lincoln
Jim Collins vs. Michael Maccoby
“quiet, workmanlike, stoic”
vs.
“larger-than-life leaders”/ “egoists,
charmers, risk-takers with big
visions”: Carnegie, Rockefeller,
Edison, Ford, Welch, Jobs, Gates
“In Tom’s world it’s always
better to try a swan
dive and deliver a
colossal belly flop than to
step timidly off the
board while holding your
nose.” —Fast Company /October2003
The Re-imagineer’s Credo … or,
Pity the Poor Brown*
Technicolor Times demand …
Technicolor Leaders and Boards who recruit …
Technicolor People who are sent on …
Technicolor Quests to execute …
Technicolor (WOW!) Projects in partnership with …
Technicolor Customers and …
Technicolor Suppliers all of whom are in pursuit of …
Technicolor Goals and Aspirations fit for …
Technicolor Times.
*WSC
“In Italy for 30 years under the Borgias
they had warfare, terror, murder,
bloodshed—and produced
Michelangelo, da Vinci and the
Renaissance. In Switzerland they had
brotherly love, 500 years of democracy
and peace, and what did they
produce—the cuckoo clock.”
Orson Welles, as Harry Lime, in “The Third Man”
II. NEW
BUSINESS.
NEW TECH.
3. The White
Collar Revolution
& the Death of
Bureaucracy.
108 X 5
vs.
8X1
= 540 vs. 8 (-98.5%)
Steel: 75,000,000 tons in
’82 to 102,000,000 tons in
’02. 289, 000 steelworkers
in ’82 to 74,000
steelworkers in ’02.
Source: Fortune/11.24.03
“The coefficient of
friction associated with
the grunge of business
is amazing!”
Michael Schrage
“A bureaucrat is an
expensive
microchip.”
Dan Sullivan, consultant and
executive coach
IBM’s Project
eLiza!*
* “Self-bootstrapping”/ “Artilects”
“Don’t own nothin’
if you can help it.
If you can, rent
your shoes.”
F.G.
“P&G Hires Out
Employee Services to
IBM” —Burlington Free Press/09.10.03/
on IBM’s 10-year, $400M contract with P&G
(P&G farmed out IT to HP in May, Facilities to
Jones Lang LaSalle in June)
“WHERE IS YOUR JOB GOING”:
writing software, designing chips,
reading MRIs, processing mortgages,
preparing tax returns, managing
computer networks (etc: GE Capital’s
15,000 in Delhi), preparing PP slides
for McKinsey (350 in Chennai), equity
analysis of U.S. companies (Morgan
Stanley) …
Source: Fortune/11.24.03
“Know we know what all
that fiber-optic cable is
good for: BROADBAND’S
KILLER APP, IT TURNS
OUT, IS INDIA” —Fortune/11.24.03
“Organizations will still be
critically important in the world,
but as ‘organizers,’ not
‘employers’!” — Charles Handy
“The virtual corporation is
research, development, design,
marketing, financing, legal, and
other headquarters functions with
few or no manufacturing
capabilities – a company with
a head but no body.”
Richard Rosecrance, The Rise of the
Virtual State
Ford: “Vehicle
brand
owner” (“design, engineer, and
market, but not actually make”)
Source: The Company, John Micklethwait & Adrian Wooldridge
“UPS used to be a
trucking company with
technology. Now it’s a
technology company
with trucks.”
—Forbes, upon naming UPS
“Company of the Year” in Y2000
Deep Blue Redux*: 2,240
EKGs
… 1,120 heart attacks.
Hans Ohlin
: 620.
Lars Edenbrandt’s
software: 738.
(50 yr old chief of coronary care, Univ of
Lund/SW)
*Only this time it matters!
“Most physicians believe that
diagnosis can’t be reduced to a set of
generalizations—to a ‘cookbook.’ …
How often does my intuition lead me
astray? The radical implication of the
Swedish study is that the
individualized, intuitive approach that
lies at the center of modern medicine
is flawed—it causes more mistakes
than it prevents.” —Atul Gawande, Complications
Probable parole violations: Simple model
(age, # of previous offenses, type of crime)
beats M.D. shrinks.
100 studies: Statistical formulas > Human
“In virtually all
cases, statistical thinking
equaled or surpassed
human judgment.”—Atul Gawande,
judgment.
Complications
“Unless mankind redesigns
itself by changing our DNA
through altering our genetic
makeup, computergenerated robots will take
over the world.” – Stephen
Hawking, in the German magazine Focus
Vernor Vinge/Mr. Singularity
“The transition time from human
history to post-human singularity
time, Vinge thinks, will be
astonishingly short—maybe one
hundred hours from the first
moment of computer selfawareness to computer world
conquest.”—Esquire/12.2002
E.g. …
Jeff Immelt: 75% of “admin, back
room, finance” “digitalized” in
years.
Source: BW (01.28.02)
BW Cover/02.2003
“IS YOUR JOB NEXT? A
New Round of GLOBALIZATION Is
Sending Upscale Jobs Offshore.
They Include Chip Design, Basic
Research—even Financial
Analysis. Can America Lose These
Jobs and Still Prosper?”
Everybody’s Doin’ It!
“The leading Indian
outsourcers reckon that the
key to their long-term
prosperity is bagging ever
larger deals and moving
ever higher up the value
chain.” —The Economist/01.11.2003
“GE is a champion of India’s scientists,
technicians, business analysts and
graduates, thousands of whom work at
the U.S. conglomerate’s offshore service
centers in India. They are the low-cost,
high capability vanguard of GE’s
outsourcing to India. Along the way, GE
has transformed its cost structure,
enhanced its ability to provide technology
services and incubated a rare world-class
industry in India.” —FT/06.03.03
“One Singaporean worker
costs as much as …
3 … in Malaysia
8 … in Thailand
13 … in China
18 … in India.”
Source: The Straits Times/08.18.03
“Outsourcing Trend Called ‘Threat’
to Middle-class Workforce” —USA
Today/08.05.03 (Mgt jobs moving:
2000: 0; 2005: 37,000)
“Loss of Factory Jobs May Have a
Long Fall to Bottom” —Boston Globe/08.10.03
(75,000 per month during last 18 months)
“The New Job Reality” —Cover/USN&WR/08.11.03
(“The dearth of jobs stems from factors signaling a sea change…”)
!!!!!!!!!
ebookers PLC
Predicted U.S. High-wage Job Losses
2005
Managers
Life sciences
Design
Architecture
Bus Ops
Computer
Office support
37,000
3,700
6,000
32,000
61,000
109,000
295,000
2015
288,000
37,000
30,000
184,000
348,000
473,000
1,700,000
Source: Forrester Research (BusinessWeek/08.25.03)
4. IS/ IT/
Web … “On the
Bus” or “Off the
Bus.”
“E-commerce is happening the way all
the hype said it would. Internet
deployment is happening. Broadband
is happening. Everything we ever said
about the Internet is happening. And it
is very, very early. We can’t even
glimpse IT’s potential in changing the
way people work and live.” —Andy Grove
(BusinessWeek/August 2003)
e-piphany
epicurious.com
square feet
Dell’s OptiPlex Facility
Big Job: 6
to 8 hours.
(80,000 per day)
Parts Inventory:
square feet.
“Invisible Supplier Has
Penney’s Shirts All Buttoned
Up: From Hong Kong, It
Tracks Sales, Restocks
Shelves, Ships Right to the
Store.” —Headline, Wall Street Journal (09.11.03)
“Our entire facility is digital. No paper, no film, no
medical records. Nothing. And it’s all integrated—from the lab to
X-ray to records to physician order entry. Patients don’t have to
wait for anything. The information from the physician’s office is
in registration and vice versa. The referring physician is
immediately sent an email telling him his patient has shown up.
… It’s wireless in-house. We have 800 notebook computers that
are wireless. Physicians can walk around with a computer that’s
pre-programmed. If the physician wants, we’ll go out and wire
their house so they can sit on the couch and connect to the
network. They can review a chart from 100 miles away.” —David
Veillette, CEO, Indiana Heart Hospital (HealthLeaders/12.2002)
“Dawn Meyerreicks, CTO of the Defense Information Systems Agency, made
one of the most fateful military calls of the 21st century. After 9/11 … her office
quickly leased all the available transponders covering Central Asia. The
implications should change everything about U.S. military thinking in the
years ahead.
“The U.S. Air Force had kicked off its fight against the Taliban with an
ineffective bombing campaign, and Washington was anguishing over whether
to send in a few Army divisions. Donald Rumsfeld told Gen. Tommy Franks to
give the initiative to 250 Special Forces already on the ground. They used
satellite phones, Predator surveillance drones, and GPS- and laser-based
targeting systems to make the air strikes brutally effective.
“In effect, they ‘Napsterized’ the battlefield by cutting out the middlemen
(much of the military’s command and control) and working directly with the
real players. … The data came in so fast that HQ revised operating procedures
to allow intelligence analysts and attack planners to work directly together.
Their favorite tool, incidentally, was instant messaging over a secure
network.”—Ned Desmond/“Broadband’s New Killer App”/Business 2.0/
OCT2002
“The mechanical speed of
combat vehicles has not
increased since Rommel’s day,
so the difference is all in the
operational speed, faster
communications and faster
decisions.” —Edward Luttwak, on the
unprecedented pace of the move toward Baghdad
“Supply Chain” 2000:
“When Joe Employee at Company X launches his
browser, he’s taken to Company X’s personalized
home page. He can interact with the entire scope of
Company X’s world – customers, other employees,
distributors, suppliers, manufacturers, consultants.
The browser – that is, the portal – resembles a My
Yahoo for Company X and hooks into every network
associated with Company X. The real trick is that Joe
Employee, business partners and customers don’t
have to be in the office. They can log on from a cell
phone, Palm Pilot, pager or home office system.”
Red Herring (09.2000)
The Real “News”: X1,000,000
TowTruckNet.com
eRevolution
40,000,000 Americans
(1 of 2 singles/40% of American
adults) went to an online
matchmaking site last month
(USN&WR/09.29.03)
“flash mobs” (!)
“Q: What will happen when
a national party can fit on
a laptop?
“A: See below.”
Source: Headline/Washington
Post/OUTLOOK/12.14.2003
“Open source is doing for mass
innovation what the assembly line
did for mass production. Get ready
for the era when collaboration
replaces the corporation.” —Thomas
Goetz/ Wired/11.2003 (“Current methods are not fast enough,
not ambitious enough, or don’t take advantage of our collective
creative potential.”)
Impact No. 1/ Logistics &
Wal*Mart …
Dell … Amazon.com …
Autobytel.com …
FedEx … UPS … Ryder
… Cisco … Etc. … Etc.
… Ad Infinitum.
Distribution:
$400.
Wal*Mart: 13%.
Autobytel:
Source: BW(05.13.2002)
“If early soldiers idealized Napoleon or
Patton, network-centric warriors
admire Wal*Mart, where point-of-sale
scanners share information on a near realtime basis with suppliers and also produce
data that is mined to help leaders develop
new strategic or tactical plans. Wal*Mart is
an example of translating information into
competitive advantage.”—Tom Stewart,
Business 2.0
Supply-chain
Optimization
From:
Design-chain
Optimization
To:
Source: Cadence Design Systems
“A Big Electronics
Show, the Buzz Is All
About Connections” —
headline, New York Times/
01.13.2003/ Consumer Electronics
Show
m-“On” or Out of the Loop
“Managers in Finland always keep
their phones on. Customers expect
fast reactions. And if you can’t reach a
superior, you make many decisions
yourself. Managers who want to
influence decisions of subordinates
must keep their phones open.” —Risto
Linturi, Finnish m-guru, in Howard Rheingold’s Smart
Mobs
WebWorld = Everything
Web as a way to run your business’s innards
Web as connector for your entire supply-demand chain
Web as “spider’s web” which re-conceives the industry
Web/B2B as ultimate wake-up call to
“commodity producers”
Web as the scourge of slack, inefficiency, sloth,
bureaucracy, poor customer data
Web as an Encompassing Way of Life
Web = Everything (P.D. to after-sales)
Web forces you to focus on what you do best
Web as entrée, at any size, to World’s Best at Everything
as next door neighbor
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-free
Internet intense = Do it all via the Web
Knowledge based = Open access
Time and location free = Whenever, wherever
“Instantly” responsive = Speed demons
Customer centric = Customer calls the shots
Mass customization enabled = Every product
and service rapidly tailored to client
requirements
Message: eCommerce
is not a
technology play! It is a
relationship, partnership,
organizational and
communications play, made
possible by new
technologies.
Message: There
is no such
thing as an effective B2B or
Internet-supply chain
strategy in a low-trust,
bottleneckedcommunication, six-layer
organization.
“Ebusiness is about rebuilding
the organization from the
ground up. Most companies today
are not built to exploit the Internet.
Their business processes, their
approvals, their hierarchies, the
number of people they employ … all of
that is wrong for running an
ebusiness.”
Ray Lane, Kleiner Perkins
Read It Closely: “We
don’t sell
We
sell speed.”
insurance anymore.
Peter Lewis, Progressive
The New Infantry Battalion/
New York Times/12.01.2002
“Pentagon’s Urgent Search for
Speed.” 270 soldiers (1/3rd normal
complement); 140 robotic off-road
armored trucks. “Every soldier is a
sensor.” “Revolutionary capabilities.”
Find-to-hit: 45 minutes to 15 minutes
… in just one year.
“There’s no use trying,” said Alice.
“One can’t believe impossible things.”
“I daresay you haven’t had much
practice,” said the Queen. “When I was
your age, I always did it for half an
hour a day. Why, sometimes I’ve
believed as many as six impossible
things before breakfast.”
Lewis Carroll
I’net …
allows you to
dream dreams
you could never
have dreamed
before!
…
“Don’t rebuild.
Reimagine.”
The New York Times Magazine on the future of
the WTC space in Lower Manhattan/09.08.2002
“Suppose—just suppose—that the Web is a new world
we’re just beginning to inhabit. We’re like the earlier
European settlers in the United States, living on the
edge of the forest. We don’t know what’s there and we
don’t know exactly what we need to do to find out: Do
we pack mountain climbing gear, desert wear, canoes,
or all three? Of course while the settlers may not have
known what the geography of the New World was
going to be, they at least knew that there was a
geography. The Web, on the other hand, has no
geography, no landscape. It has no distance. It has
nothing natural in it. It has few rules of behavior and
fewer lines of authority. Common sense doesn’t hold
here, and uncommon sense hasn’t yet emerged.”
David Weinberger, Small Pieces Loosely Joined
“Hyperlinks subvert
hierarchy!”
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]
Case:
CRM
Anne Busquet/ American Express
Not: “Age of the Internet”
“Age of
Customer
Control”
Is:
Amen!
“The Age of the
Never Satisfied
Customer”
Regis McKenna
“The Web enables total
transparency. People with
access to relevant information are
beginning to challenge any type of
authority. The stupid, loyal and
humble customer, employee, patient
or citizen is dead.”
Kjell Nordström and Jonas Ridderstråle,
Funky Business
“Parents, doctors, stockbrokers,
even military leaders are starting to
lose the authority they once had.
There are all these roles premised on
access to privileged information. …
What we are witnessing is a
collapse of that advantage,
prestige and authority.”
Michael Lewis, next
“A seismic shift is underway in
healthcare. The Internet is
delivering vast knowledge and new
choices to consumers—raising their
expectations and, in many cases,
handing them the controls.
[Healthcare] consumers are driving
radical, fundamental change.”
Deloitte Research, “Winning the Loyalty
of the eHealth Consumer”
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
Psych 101:
Strongest Force on Earth?
My need to be in
perceived control
of my universe!
“CRM has, almost
universally, failed
to live up to
expectations.”
Butler Group (UK)
FT: “The aim [of
CRM] is to make customers
feel as they did in the preelectronic age when service
was more personal.”
No! No! No!
One Person’s Opinion
TP to reporter:
“Service is
MUCH better! Would you go
back to bank tellers and phone
operators? Value that I place on
a “smile”: 3 on a scale of 10. Value
I place on fast & accurate “digital”
response: 11 on a scale of 10!!
CGE&Y (Paul Cole): “Pleasant
“Systemic
Opportunity.” “Better job
of what we do today” vs. “Rethink overall
enterprise strategy.”
Transaction” vs.
Here We Go Again: Except It’s Real This Time!
Bank online: 24.3M (10.2002); 2X Y2000.
Wells Fargo: 1/3rd; 3.3M; 50%
lower
attrition rate; 50% higher growth in
balances than off-line; more likely to
cross-purchase; “happier and stay
with the bank much longer.”
Source: The Wall Street Journal/10.21.2002
III. NEW
BUSINESS. NEW
VALUE
PROPOSITION.
5. The “PSF
Solution”:
The Professional
Service Firm Model.
“ Daddy,
what do you do?”
Sarah:
“I’m a ‘cost
center.’ ”
Daddy:
So what will be the
Basic Building
Block of the
New Org?
Every job done
in W.C.W. is also
done “outside”
…for profit!
Answer: PSF!
[Professional Service Firm]
Department Head
to …
Managing Partner,
HR [IS, etc.] Inc.
TP to NAPM:
You are the …
Rock Stars
of the
B2B Age!
Message: You are
Re-invention
Evangelists!
TP to HRMAC:
You are the …
Rock Stars
of the Age of
Talent!
DD$21M
Talent
Department
“P.S.F.”: Summary
H.V.A. Projects (100%)
Pioneer Clients
WOW Work (see below)
Hot “Talent” (see below)
“Adventurous” “culture”
Proprietary Point of View (Methodology)
W.W.P.F. (100%)/Outside Clients (25%++)
When: Now!
BMW’s
Designworks/USA:
>50% from outside
work
G.M. = The Recruitment and
Development of Top Talent.
[Period!]
V.C. = Bets on “Talent.” Bets
on Projects. [Period!]
Dept. Head I = Sports G.M.
Dept. Head II = V.C.
eHR*/PCC**
*All HR on the Web
**Productivity Consulting Center
Source: E-HR: A Walk through a 21st Century HR
Department, John Sullivan, IHRIM
Is There a There There: The Ericsson Case
1. 50+% Mfg to Solectron/Flextronics
2. Substantial R&D to India
3. Division for licensing technology
4. JV with Sony on “crown jewel” handsets
5. Net: “a wireless specialist that
depends on services more than
manufacturing, on knowledge more
than metal”
Source: BW/11.04.02
Model PSF …
(1) Translate ALL departmental
activities into discrete
W.W.P.F. “Products.”
(2) 100% go on the Web.
(3) Non-awesome are
outsourced (75%??).
(4) Remaining “Centers of
Excellence” are retained &
leveraged to the hilt!
“Typically in a mortgage company or
financial services company, ‘risk
management’ is an overhead, not a revenue
center. We’ve become more than that.
We pay for ourselves, and
we actually make money
for the company.”
—Frank Eichorn,
Director of Credit Risk Data Management Group, Wells Fargo
Home Mortgage (Source: sas.com)
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
Culture Change
Now!
Lives in the Moment!
Culture Change is
Entirely in Your Hands!
6. The Heart of the Value
Added Revolution:
PSFs Unbound/ The
“Solutions
Imperative.”
Base Case: The
Sameness Trap
“Companies have defined
so much ‘best practice’
that they are now more or
less identical.”
Jesper Kunde, A Unique Moment
“While everything may
it is also
increasingly
the same.”
be better,
Paul Goldberger on retail, “The Sameness of Things,”
The New York Times
“When we did it
‘right’ it was
still pretty
ordinary.”
Barry Gibbons on
“Nightmare No. 1”
“When McDonald’s first started
exporting its formula of quality,
cleanliness and service, it was
something of a novelty. … These
days, quality, cleanliness and
service are a given—and people
are becoming more interested in
what they are eating.” —FT/12.21.2002
“Customers will try ‘low cost
providers’ … because
the
Majors have not
given them any clear
reason not to.”
Leading Insurance Industry Analyst
“This is a dying business. Everybody’s
going after the same writers, the same
concepts, the same audience.”
— Network TV exec, to Fortune (12 January 1998)
Getting Beyond Lip Service!
“No longer are we only an
insurance provider. Today, we
also offer our customers the products
and services that help them achieve
their dreams, whether it’s financial
security, buying a car, paying for home
repairs, or even taking a dream
vacation.”—Martin Feinstein, CEO, Farmers Group
“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 Nordström and Jonas Ridderstråle, Funky Business
Funky Business: “To succeed we
must stop being so goddamn
normal. In a winner-takes-all world,
normal =
nothing.”
“MIT Everywhere: EVERY
LECTURE, EVERY LECTURE,
EVERY QUIZ, ALL ONLINE, FOR
FREE. MEET THE GLOBAL GEEKS
GETTING AN MIT EDUCATION,
OPEN SOURCE-STYLE.” —
Headline/Wired/09.03
“The Internet is the most effective profitkiller on earth … it stimulates a TRUE
FREE MARKET; and a real free market is
the most dangerous of marketplaces for
companies selling the SAME OLD STUFF.
To those with COURAGE, free markets are
great—they help kill off the deadwood
competitors who don’t have the courage
to change—making way for them to
LEVERAGE their DRAMATIC DIFFERENCE
into profitable growth.”—Doug Hall
Fight ’til Death!
“I thought, ‘What a dreadful mission I have in life.’
I’d love to get six-thousand restaurants up to
spec, but when I do it’s ‘Ho-hum.’ It’s bugged me
ever since. It’s one of the great paradoxes of
modern business. We all know distinction is key,
and yet in the last twenty years we have created a
plethora of ho-hum products and services. Just
go fly in an airplane. It could be such an
enlightening experience. Ho-hum. We swim in an
ocean of ho-hum, and I’m going to fight it. I’m
going to die fighting it.”
— Barry Gibbons
The
Day!
09.11.2000: HP bids
$18,000,000,000
for
PricewaterhouseCoopers
consulting business!
“These days, building
the best server isn’t
enough. That’s the
price of entry.”
Ann Livermore, Hewlett-Packard
Systems
Integrator of
choice. Global Services:
Gerstner’s IBM:
$35B. Pledge/’99: Business
Partner Charter. 72 strategic partners,
aim for 200. Drop many in-house
programs/products. (BW/12.01).
“You are headed
for commodity
hell if you don’t
have services.”—Lou
Gerstner on IBM’s coming
revolution (1997)
AT&T: President David Dorman:
Back to long distance … but with
“bundles of lucrative corporate
services” for the likes of Merrill
Lynch, MasterCard, Hyatt.
Consumer: Dump 25M subscribers
(50%)—hold on to high enders.
Source: BW/05.20.2002
Is There a There There: The Ericsson Case
1. 50+% Mfg to Solectron/Flextronics
2. Substantial R&D to India
3. Division for licensing technology
4. JV with Sony on “crown jewel” handsets
5. Net: “a wireless specialist that
depends on services more than
manufacturing, on knowledge more
than metal”
Source: BW/11.04.02
Everybody’s Doin’ It!
“The leading Indian
outsourcers reckon that the
key to their long-term
prosperity is bagging ever
larger deals and moving
ever higher up the value
chain.” —The Economist/01.11.2003
“We want to be the
air traffic
controllers of
electrons.”
Bob Nardelli, GE Power Systems
“Customer Satisfaction” to
“Customer Success”
“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
Keep In Mind:
Customer
Satisfaction
versus
Customer
Success
Was: “Big
Iron”
Transformer Dudes
Division.
Is: Air
Traffic Controllers
of Electrons.
Was: Bunch
of Guys Who
Make Circuit Breakers
Division.
Is: GE
Industrial Systems.
GE’s New Six Sigma Approach
Old view: Out of service 9 days. 4
days are transport, which is client
responsibility.
New view: ALL 9 DAYS ARE OUR
RESPONSIBILITY! Why? 9 days =
Client’s World.
Source: Steve Kerr, VP, GE
E.g. …
UTC/Otis + Carrier:
boxes to “integrated
building systems”
Units of
“Coolth”
Leased AC:
Nardelli’s goal ($50B to $100B by 2005):
“… move Home Depot beyond selling
‘goods’ to selling ‘home services.’ …
He wants to capture home
improvement dollars wherever and
however they are spent.”
E.g.: “house calls” (At-Home Service: $10B by ’05?) …
“pros shops” (Pro Set) … “home project management”
(Project Management System … “a deeper selling
relationship”).
Source: USA Today/06.14.2002
Staples
New CEO Ron Sargent:
2X to $40B, in face of
Wal*Mart (et al.) via
delivery and other
services
Source: BusinessWeek/08.03
John Deere
Landscapes:
“This is our
future.”
“A little-known fact: Siemens is
now the world’s largest application
service provider* to the health
business. Digitally stored X rays,
recordkeeping, the cameras that
guide surgeons in the operating
theater—all run on Siemens
software” —Forbes/09.16.2002
*E.g.: “Siemens is giving Health South an all-digital ‘hospital of the future.’ ”
“UPS wants to take over the
sweet spot in the endless loop
of goods, information and
capital that all the packages
[it moves] represent.”
ecompany.com/06.01 (E.g., UPS Logistics
manages the logistics of 4.5M Ford vehicles,
from 21 mfg. sites to 6,000 NA dealers)
“UPS used to be a
trucking company with
technology. Now it’s a
technology company
with trucks.”
—Forbes, upon naming UPS
“Company of the Year” in Y2000
“No longer are we only an
insurance provider. Today,
we also offer our customers the
products and services that help them
achieve their dreams, whether it’s
financial security, buying a car, paying
for home repairs, or even taking a
dream vacation.”—Martin Feinstein, CEO,
Farmers Group
“VISIONS OF A BRAND-NAME
OFFICE EMPIRE. Sam Zell is not a man
plagued by self doubt. Mr. Zell controls public
companies that own nearly 700 office buildings
in the United States. … Now Mr. Zell says he will
transform the real estate market by turning
those REITs into national brands. … Mr. Zell
believes [clients] will start to view those offices
as something more than a commodity chosen
chiefly by price and location.” –New York Times
(12.16.2001)
“ ‘Architecture’ is
becoming a commodity.
Winners will be ‘Turnkey
Facilities Management’
providers.”
SMPS Exec
“We are a ‘real estate
facilities consulting’
organization, not just
an ‘interior design’
firm.”
Jean Bellas, founder, SPACE (from SMPS Marketer)
Omnicom:
57%
(of
$6B) from marketing services
And the Winners Are …
Televisions –12%
Cable TV service +5%
Toys -10%
Child care +5%
Photo equipment -7%
Photographer’s fees +3%
Sports Equipment -2%
Admission to sporting event +3%
New car -2%
Car repair +3%
Dishes & flatware -1%
Eating out +2%
Gardening supplies -0.1%
Gardening services +2%
Source: WSJ/05.16.03
IBM/Q3/10.15.03/Rev: +5%
Services/Consulting: +11%
Software: +5%
Hardware: -5%
PCs: -2%
Technology/Chips: -33%
FEES! FEES! FEES!
—Cover Story, BW/09.29.03
Turnkey Nation
HP … Sun … Farmers Group …
Northwestern Mutual Financial Network …
IBM … AT&T … Ericsson … GE Power
Systems … GE Industrial Systems …
Ford … Siemens … Home Depot …
Deere … UTC Otis … UTC Carrier …
UPS … Springs Industries … RCI …
Equity Office Properties … Omnicom …
India … Etc.
(1) 108X5 to
8X1/ eLiza/ 100sf. (2)
Dept. to PSF/ WWPF. (3)
V.A. via PSFs Unbound/
“Solutions”/ “Customer
Success.”
Core Logic:
Model2002/3/4/5/??
Dell* + IBM** =
Magic
*Cut (ALL) the bullshit
**Add (LOTSA) “soft”/“integrative”/“experiences” value
7. The …
Solutions25.*
*NO MORE “SILOS.” NO MORE
“STOVEPIPES.” (DAMN IT.)
1. It’s the (OUR!) organization, stupid!
2. Friction free!
3. No STOVEPIPES!
4. “Stovepiping” is a F.O.—Firing Offense.
5. ALL on the web! (ALL = ALL.)
6. Open access!
6. Project Managers rule! (E.g.: Control the purse
strings and evals.)
7. VALUE-ADDED RULES! (Services Rule.)
(Experiences Rule.) (Brand Rules.)
8. SOLUTIONS RULE! (We sell SOLUTIONS.
Period. We sell PRODUCTIVITY &
PROFITABILITY. Period.)
9. Solutions = “Our ‘culture.’ ”
10. Partner with B.I.C. (Best-In-Class). Period.
“The organizations we created have
become tyrants. They have taken
control, holding us fettered, creating
barriers that hinder rather than help
our businesses. The lines that we
drew on our neat organizational
diagrams have turned into walls
that no one can scale or penetrate
or even peer over.” —Frank Lekanne Deprez &
René Tissen, Zero Space: Moving Beyond Organizational Limits.
“Once devised in Riyadh, the tasking order took hours
to get to the Navy’s six aircraft carriers—because the
Navy had failed years earlier to procure the proper
communications gear that would have connected the
Navy with its Air Force counterparts. … To
compensate for the lack of communications capability,
the Navy was forced to fly a daily cargo mission from
the Persian Gulf and Red Sea to Riyadh in order to
pick up a computer printout of the air mission tasking
order, then fly back to the carriers, run photocopy
machines at full tilt, and distribute the documents to
the air wing squadrons that were planning the next
strike.” –Bill Owens, Lifting the Fog of War
Duh???*: “We’ve come up with a solution.
… We’ve begun to create a form of
communications that is much better than
we had before, and that’s allowed us to
gather better data. We’ve finally realized
that we have an interplay with other
hospitals and with pre-hospital.”—Dr. Ben
Honigman, ER, U. Colorado Hospital, on “diverts” (Denver
Post/05.05.02)
*Internet + Data + Open data exchange + Barrier busting
12. All functions contribute equally—IS, HR, Finance,
Purchasing, Engineering, Logistics, Sales, Etc.
13. Project Management can come from any function.
14. WE ARE ALL IN SALES. PERIOD.
15. We all invest in “wiring” the customer
organization.
16. WE ALL “LIVE THE BRAND.” (Brand = Solutions.
That MAKE MONEY FOR OUR CUSTOMERPARTNER.)
17. We use the word “PARTNER” until we all want to
barf!
18. We NEVER BLAME other parts of our organization
for screw-ups.
19. WE AIM TO REINVENT THIS INDUSTRY!
20. We hate the word-idea “COMMODITY.”
21. We believe in “High tech, High touch.”
22. We are DREAMERS.
23. We deliver . (PROFITS.) (CUSTOMER SUCCESS.)
24. If we play the “SOLUTIONS GAME” brilliantly, no
one can touch us!
25. Our TEAM needs 100% I.C.s (Imaginative
Contributors). This is the ULTIMATE “All Hands”
affair!
KEY WORDS: Partners with our
Customers in creating
Memorable, Value-added
Solutions/ Successes/
Experiences.
WHICH REQUIRES: Total
Enterprise Responsiveness …
beyond functional walls.
“Supply Chain” 2000:
“When Joe Employee at Company X launches his
browser, he’s taken to Company X’s personalized
home page. He can interact with the entire scope of
Company X’s world – customers, other employees,
distributors, suppliers, manufacturers, consultants.
The browser – that is, the portal – resembles a My
Yahoo for Company X and hooks into every network
associated with Company X. The real trick is that Joe
Employee, business partners and customers don’t
have to be in the office. They can log on from a cell
phone, Palm Pilot, pager or home office system.”
Red Herring (09.2000)
IV. NEW
BUSINESS. NEW
BRAND.
8. A World of
Scintillating/
Awesome/ WOW
“Experiences.”
“Experiences are as
distinct from services
as services are from
goods.”
Joseph Pine & James Gilmore, The Experience Economy:
Work Is Theatre & Every Business a Stage
“Club Med
is more
than just a ‘resort’; it’s a
means of rediscovering
oneself, of inventing an
entirely new ‘me.’ ”
Source: Jean-Marie Dru, Disruption
“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
“Guinness as a brand
is all about community.
It’s about bringing people
together and sharing
stories.”—Ralph Ardill, Imagination, in re
Guinness Storehouse
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
WHAT CAN BROWN DO FOR YOU?
From “Service’ to “Cause”
7X. 730A800P. F12A.*
*Plus: WOW Department’” “Kill a Stupid Rule” contests,
etc. 2001R: 34%; P: 29%; ’90-’00: 2,048%. Commerce
Bank/NJ ($10B). Source: FC05.02.
The “Experience Ladder”
Experiences
Services
Goods
Raw Materials
1940: Cake from flour, sugar (raw
materials economy): $1.00
1955: Cake from Cake mix (goods
economy): $2.00
1970: Bakery-made cake (service
economy): $10.00
1990: Party @ Chuck E. Cheese
(experience economy) $100.00
Message:
“Experience” is the
“Last 80%”
P.S.: “Experience” applies to all work!
1940: Cake from flour, sugar (raw materials
economy): $1.00
1955: Cake from Cake mix (goods economy):
$2.00
1970: Bakery-made cake (service
economy):
$10.00
1990: Party @ Chuck E. Cheese
(experience economy)
$100.00
“I see us as being in
the art business. Art,
entertainment and mobile
sculpture, which,
coincidentally, also
happens to provide
transportation.”
Bob Lutz:
Source: NYT 10.19.01
Experience It!
“Living Room, To Go: Cars of
the future will be sanctuaries,
with mood lighting, aroma
therapy and massage seats. For
long drives: movies and
popcorn” —headline,
Newsweek/11.25.2002
“Lexus sells its cars as
containers for our
sound systems. It’s
marvelous.”—Sidney Harman/
Harman International
“When Pete Rozelle ran
the league, it was a
football business and a
good one. Now it’s truly
an entertainment
business.” —Paul Much,
Investment Advisor
“Music Worth Paying For:
Paul McCartney, rapper
Jay-Z and other acts beat
the digital pirates by
cashing in on concerts”
—Forbes cover/07.07.03
It’s All About EXPERIENCES: “Trapper” to
“Wildlife Damage-control Professional”
Trapper: <$20 per beaver pelt.
WDCP: $150/“problem beaver”;
$750-$1,000 for flood-control
piping … so that beavers
can stay.
Source: WSJ/05.21.2002
Moving Companies
WSJ/08.2003: “In Texas, They’ll fill
your empty fridge with brie and
wine. An outfit in New York
promises quick high-speed Internet
hookup. And when Allied Van Lines
finishes unloading your couch,
they’ll have a feng shui expert
figure out the right spot. …”
Duet … Whirlpool … “washing machine” to
“fabric care system” … white goods: “a sea of
undifferentiated boxes” … $400 to $1,300 …
“the Ferrari of washing machines” …
consumer: “They are our little mechanical
buddies. They have personality. When they are
running efficiently, our lives are running
efficiently. They are part of my family.” …
“machine as aesthetic showpiece” … “laundry
room” to “family studio” / “designer laundry
room” (complements Sub-Zero refrigerator and
home-theater center).
Source: New York Times Magazine/01.11.2004
“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 …
Story
Adventure
Smile
Focus
Plot
Passion
“It’s a question of how to marshal our resources. I’d
like us to be
really great in four or five
areas. We have to make some hard choices.
we’ve got to get a
story about science that’s
completely understandable. To get
“The big challenge is,
money in wholesale amounts, you’ve got to sell
concepts.”
Larry Small, Smithsonian Institution
Plot It!
Williams Sonoma … 5
Crate & Barrel … 7+
Smith & Hawken … 8
Sharper Image … 9
LL Bean … 3
LAN Installation Co.
to
Geek Squad (2% to 30%/Minn.)
Hire a
theater director, as
a consultant or
FTE!
First Step (?!):
Experience …
Cirque du Soleil
DO YOU MEASURE UP?*
*If not, why not?
Words!
— Magician of Magical Moments
— Maestro of Moments of Truth
— Recruiter of Raving Fans
— Impresario of First Impressions
— Wizard of WOW
— Captain of Brilliant Comebacks
— Director of Electronic Customer Experiences
— Conductor of Customer Intimacy
— King of Customer Community
— Queen of Customer Retention
— CEO of Ownership Experience
— Managing Director of After-sales Experience
“Quality Service”
“... Superb, graceful,
beautiful, divine,
wonderful, an aesthetic
gesture”
— James Hillman, Kinds of Power
“Most executives have no
idea how to add value to a
market in the metaphysical
world. But that is what the market
will cry out for in the future. There
is no lack of ‘physical’ products to
choose between.”
Jesper Kunde, A Unique Moment [on the
excellence of Nokia, Nike, Lego, Virgin et al.]
The SAU/Straight Academic Underpinning
“That people in an advanced economy
spend more on weightless intangibles than
on three-dimensional objects causes some
folks of literal bent to feel vaguely
uncomfortable, but the trend should be of
no concern. The greater value, and more
eager expenditure, comes in the
psychological domain.” —Robert Reich
Extraction & Goods:
Male dominance
Services &
Experiences: Female
dominance
“Women don’t buy
They
join them.”
brands.
EVEolution
The “Experience Ladder”
Experiences
Services
Goods
Raw Materials
Ladder Position
Measure
Solutions
Success
(Experiences)
Services
Satisfaction
Goods
Six-sigma
<TGW
vs.
>TGR
Furniture Store with
design services
vs.
Home Transformation
Center with home
furnishing products
9. Experiences+:
Embracing the
“Dream
Business.”
“A shipping clerk earning $25,000 a year treats herself to silk
pajamas at Victoria’s Secret. A dual-income couple earning
$125,000 orders a $4,000 Viking range for their townhouse even
though the developer offered to throw in a perfectly serviceable
generic range at no extra charge. These purchases reflect an
important worldwide behavioral shift. Consumers today are
willing to pay a significant premium for goods and services
that are emotionally important to them and that deliver the
perceived values of quality, performance and engagement.
But in other categories that aren’t emotionally important, they
become bargain hunters: a passionate Mercedes driver will
shop at Target every weekend; a construction worker who
splurges on a $3,000 set of Callaway golf clubs will buy store
brand groceries.” —Trading Up: The New American Luxury/Michael
Silverstein & Neil Fiske
DREAM: “A dream is a complete
moment in the life of a client.
Important experiences that tempt
the client to commit substantial
resources. The essence of the
desires of the consumer. The
opportunity to help clients become
what they want to be.” —Gian Luigi
Longinotti-Buitoni
Common Products
“Dream” Products
Maxwell House
BVD
Payless
Hyundai
Suzuki
Atlantic City
New Jersey
Carter
Conners
CNN
Starbucks
Victoria’s Secret
Ferragamo
Ferrari
Harley-Davidson
Acapulco
California
Kennedy
Pele
Millionaire
Source: Gian Luigi Longinotti-Buitoni
Building the Creative Organization
Choose a creator: The cultural leader who gives the
company an aesthetic point of view.
Hire eclectically: Hire collaborators with different
cultures and past histories in order to balance rigor
with emotion.
Prepare vertically: Develop a rigorous understanding
of the product and the client.
Develop horizontally: Promote curiosity in unrelated
disciplines.
Lead emotionally: Engender passionate dedication
through vision and freedom.
Build for the long haul: Creativity requires a lifetime
commitment.
Source: Gian Luigi Longinotti-Buitoni
Emotional Design that Interprets Dreams
“Zero defects”: Only the starting
point.
Love at first sight.
Design for the five senses.
Develop to expand the Main Dream.
Design so as to seduce through the
peripheral senses.
Source: Gian Luigi Longinotti-Buitoni
The marketing of Dreams (Dreamketing)
Dreamketing: Touching the clients’
dreams.
Dreamketing: The art of telling stories and
entertaining.
Dreamketing: Promote the dream, not the
product.
Dreamketing: Build the brand around the
main dream.
Dreamketing: Build the “buzz,” the
“hype,” the “cult.”
Source: Gian Luigi Longinotti-Buitoni
Constantly Magnify Perceived Value
Maximize your value-added by fulfilling the
dreams of your clients.
Only invest in what is valuable for your client.
Don’t let the short-term results weaken the
long-term value of your brand.
Balance rigorous control of the financial endeavor
with the emotional management of your brand.
Build a financial structure that allows risk-taking:
NO RISKS—NO DREAMS.
Establish long-term “price power” in order to avoid
the trap of the commodity product.
Source: Gian Luigi Longinotti-Buitoni
(Revised) Experience Ladder
Dreams Come True
Awesome Experiences
Solutions
Services
Goods
Raw Materials
Safe, On-time and ...
“We defined personality as a
market niche. We seek to
amaze, surprise, entertain.”
— Herb Kelleher, SWA / LUV
Furniture vs. Dreams
“We do not sell ‘furniture’ at Domain. We
sell dreams. This is accomplished by
addressing the half-formed needs in our
customers’ heads. By uncovering these
needs, we, in essence, fill in the blanks. We
convert ‘needs’ into ‘dreams.’ Sales are the
inevitable result.”
— Judy George, Domain Home Fashions
HORCHOW.COM
Furniture. Accessories. Dreams.
Pretzel Crumb-less-ness Plus ...
“The Ritz-Carlton experience enlivens the
senses, instills well-being, and fulfills even
the unexpressed wishes and needs of our
guests.”
— from the Ritz-Carlton Credo
Credo Update (P.C. Version)
“The Ritz Carlton experience ... conforms to
requirements.”
“The sun is setting on the Information Society—even before we
have fully adjusted to its demands as individuals and as
companies. We have lived as hunters and as farmers, we have
worked in factories and now we live in an information-based
society whose icon is the computer. We stand facing the fifth
kind of society: the Dream Society. … The Dream Society is
emerging this very instant—the shape of the future is visible
today. Right now is the time for decisions—before the major
portion of consumer purchases are made for emotional,
nonmaterialistic reasons. Future products will have to appeal to
our hearts, not to our heads. Now is the time to add emotional
value to products and services.” —Rolf Jensen/The Dream Society:How the
Coming Shift from Information to Imagination Will Transform Your Business
“We found that the pace of development
from one societal type to another is
accelerating. The agricultural society
originated 10,000 years ago, the industrial
society between 200 and 100 years ago, the
information-based society 20 years ago.” —
Rolf Jensen/The Dream Society: How the Coming Shift from Information to
Imagination Will Transform Your Business
“In Denmark, eggs from free-range hens have
conquered over 50 percent of the market. Consumers
do not want hens to live their lives in small, confining
cages. They are willing to pay 15 percent to 20 percent
more for the story about animal ethics. This is classic
Dream Society logic. Both kind of eggs are similar in
quality, but consumers prefer eggs with the better
story. After we debated the issue and stockpiled 50
other examples, the conclusion became evident:
Stories and tales speak directly to the heart rather than
the brain. After a century where society was marked by
science and rationalism, the stories and values are
returning to the scene.” —Rolf Jensen/The Dream Society: How the
Coming Shift from Information to Imagination Will Transform Your Business
“Person 1 is the rational, planning being, and
Person 2 is the emotional and story-buying
entity. The last century disowned and repressed
Person 2—a rejection that is not surprising in a
technological era. Now Person 2 is back in
town—in the shops, on the Internet, in the
companies, in politics, in economics, even
science.” —Rolf Jensen/The Dream Society: How the Coming Shift from
Information to Imagination Will Transform Your Business
Six Market Profiles
1. Adventures for Sale
2. The Market for Togetherness, Friendship
and Love
3. The Market for Care
4. The Who-Am-I Market
5. The Market for Peace of Mind
6. The Market for Cnvictions
Rolf Jensen/The Dream Society: How the Coming Shift from
Information to Imagination Will Transform Your Business
??????
OUT: Branding
IN: Story-ing/
Storytelling
New Market Realities
Selling Dreams: How to Make Any Product
Irresistible, Gian Luigi Longinotti-Buitoni
The Dream Society: How the Coming Shift from
Information to Imagination Will Transform Your
Business, Rolf Jensen
Trading Up: The New American Luxury, Michael
Silverstein & Neil Fiske
10. The
“Soul”
of “Experiences”:
[Mostly Ignored]
Design Rules!
Design Myths.
Unconventional
[Design] Messages
Not about ... “Lumpy Objects”!
Not about ... $79,000 objects
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
Design Transforms even the
[Biggest] Corporations!
TARGET … “the champion of
America’s new design democracy”
(Time) “Marketer of the Year 2000”
(Advertising Age)
Lady Sensor, Mach3, and …
$70M on developing the
OralB CrossAction toothbrush
23 patents, including 6 for the
packaging
Source: www.ecompany.com [06.00]
Design2002
LISTERINE’s …
PocketPaks
Westin’s …
Heavenly
Bed
Design’s place in
the universe.
And Tomorrow …
“Fifteen years ago companies
competed on price. Now it’s
Tomorrow
it’s design.”
quality.
Robert Hayes
All Equal Except …
“At Sony we assume that all products of
our competitors have basically the same
technology, price, performance and
Design is the only
thing that differentiates one
product from another in the
marketplace.”
features.
Norio Ohga
“Design is treated
like a religion at
BMW.”
Fortune
“The new Beetle fails at
most categories. The only
thing it doesn’t fail in is
drop-dead charm.”
Jerry Hirshberg, Nissan Design International
Auto Designers at Milan Fashion Shows!
“Welcome to the world of the
celebrity car designer, a new
breed increasingly responsible
for the fortunes of the world’s
big car companies. We live in a
designer world, and the car
designers are at its heart.” —The
Economist/12.21.2002
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
“The good 10 percent of
American product design comes
out of big-idea companies that
don’t believe in talking to the
customer. They're run by
passionate maniacs who make
everybody’s life miserable until
they get what they want.”
Bran Ferren, Applied Minds/Wired 1-2001
“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
Design is
the fundamental soul
meaning of design.
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 …”
“Passionate maniacs …”
“Fundamental soul …”
Bottom Line.
Design “is” … WHAT &
WHY I LOVE.
LOVE.
I
LOVE
my ZYLISS
Garlic Peeler!
All Time
No.1 (TP)
Ziplocs
Design “is” … WHY I
GET MAD.
MAD.
Wanted: THE
DESIGNER OF MY
RADIO SHACK
PHONE. Major
Reward!
Design is never
neutral.
DESIGN is the
principal difference
between love and
hate!
Hypothesis:
THE BASE CASE: I am a design fanatic. Though not
“artistic,” I love “cool stuff.” But it goes [much]
further, far beyond the personal. Design has become
a professional obsession. I SIMPLY BELIEVE THAT
DESIGN PER SE IS THE PRINCIPAL REASON
FOR EMOTIONAL ATTACHMENT [or detachment]
RELATIVE TO A PRODUCT OR SERVICE OR
EXPERIENCE. Design, as I see it, is arguably the
#1 DETERMINANT
of whether a productservice-experience stands out … or doesn’t.
Furthermore, it’s another “one of those things”
that damn few companies put – consistently – on the
front burner.
Message (?????): Men
cannot design for women’s
needs.
“Perhaps the macho look
can be interesting … if you
want to fight dinosaurs. But
now to survive you need
intelligence, not power and
aggression. Modern intelligence
means intuition—it’s female.”
Source: Philippe Starck, Harvard Design Magazine (Summer 1998)
Step No. 1:
NOTEBOOK
POWER!
[Start recording the awesome & the
awful]
User …
STOP
BLAMING
YOURSELF!
(Don
Norman/Design of Everyday Things)
The Designer’s Ring
“For years I thought that Dante should have
established a ‘designer’s ring’ in his Hell. If any
designer’s product raised a blister, caused a
bruise, ripped a stocking, or caused any of the
thousand things that frustrate us with the
products we use, that designer would be assigned
the designer’s ring in Hell and forced to use that
product for all of eternity.” — James Pirki, designer
and
professor, Syracuse University
“Sometimes I have
episodes of wild fury in
rental cars. It’s not road
rage. It’s more like design
rage.”
Susan Casey, www.ecompany.com
Design Case I …
Thomas Hine: The Total
Package: The Secret History
and Hidden Meanings of
Boxes, Bottles, Cans, and
Other Persuasive Containers
“Packages have
personality. They create
confidence and trust.
They spark fantasies.
They move the goods!”
—Thomas Hine/The Total Package
“The most fundamental difference
between a traditional market and
the places through which you push
your cart is that in modern retailing
all the selling is done without
people. It replaces people with
packages.” —Thomas Hine/The Total Package
Oatmeal/1870: “horses and a few
stray Scots”
Oatmeal/1890/Quaker: “a delicacy
for the epicure, a nutritious dainty
for thr invalid, a delight to the
children”
Difference: Packaging!
Thomas Hine/The Total Package
“During the thirty minutes you spend on
an average trip to the supermarket, about
thirty thousand different products vie to
win your attention and ultimately to make
you believe in their promise. When the
door opens, you enter an arena where your
emotions are in play—and a walk down the
aisles is an exercise in self-definition. Few
experiences in life offer the visual intensity
of a Safeway, a Krogers. …”—Thomas
Hine/The Total Package
Research: customers aware of
11,000 packages in 1,800 seconds
walking the aisles.
th
Opportunity = 1/6
second!
Source: Thomas Hine/The Total Package
“Packaging strives at once to offer excitement
and reassurance. It promises something newer
and better, but not necessarily different. When
we talk about a tourist destination, or even a
presidential contender, being packaged that’s
not really a metaphor. The same projection of
intensified ordinariness, the same combination
of titillation and reassurance, are used for
laundry detergents, theme parks and candidates
alike.”—Thomas Hine/The Total Package
“What’s important to
recognize is that fast-food
and motel chains are not
like packages, but that they
are packages—packaged
places and experiences.” —
Thomas Hine/The Total Package
“One, consumers really do not
distinguish between a product and
its package. Two, consumers
relate emotionally not to the facts
(the realities) of the
product/packages they are
involved with, but rather to their
perceived realities.” —Walter Stern in
Thomas Hine/The Total Package
15 “Leading” Biz Schools
Design/Core: 0
Design/Elective: 1
Creativity/Core: 0
Creativity/Elective: 4
Innovation/Core: 0
Innovation/Elective: 6
Source: DMI/Summer 2002
11. Design+ =
“Beautiful”
Systems.
Fred S.’s “mediocre”
thesis. Herb K.’s
napkin.
Great design =
One-page
business plan (Jim
Horan)
The One-page Proposal:
How to Get Your Business
Pitch onto One Persuasive
Page —Patrick Riley (“Why not one and a
half? Why not two? Sorry, it’s one or nothing.
Once the proposal extends past the first page,
the battle is lost.”)
There Are Lawyers … and Then There Are
Lawyers: John De Laney/ICM
ANYTHING TRULY
IMPORTANT CAN BE
BOILED DOWN TO
RD
1/3 PAGE.
K.I.S.S.:
Gordon Bell (VAX
500/50.
daddy):
Chas.
Wang (CA): Behind schedule?
Cut least
productive 25%.
have. Must
hate. / Must
design. Must undesign.
Systems: Must
Mgt. Team
includes … EVP
(S.O.U.B.)
Executive Vice President, Stomping Out Unnecessary Bullshit
“Ninety percent of what
we call ‘management’
consists of making it
difficult for people to
get things done.” – P.D.
First Steps: “Beauty Contest”!
1. Select one form/document: invoice, air bill,
sick leave policy, customer returns-claim form.
2. Rate the selected doc on a scale of 1 to 10 [1 =
Bureaucratica Obscuranta/ Sucks; 10 = Work
of Art] on four dimensions: Beauty.
Grace. Clarity. Simplicity.
3. Re-invent!
4. Repeat, with a new selection, every 15 working
days.
Beautiful
Aesthetic Triumph
Breathtaking
Was
“Deposits may be made by a minor and
withdrawals thereof may be made by a
minor without the consent of a parent or
guardian, neither of whom, in that
capacity, shall have any right to attach or
interfere in any manner with such
deposits or withdrawals.”
Is
“Minors may make deposits and
withdrawals from their accounts without the
consent or interference of a parent or
guardian.”
Was
“This Grievance Procedure must be used if the nature of the complaint
deals with the quality of services given to the Member, including
complaints about waiting times, physician demeanor and behavior, or
adequacy of facilities (as opposed to whether or not a particular
service is a Covered service and what amount, if any, should be paid).
Also, this Grievance Procedure will be applied under all circumstances
to any Universal Healthcare supplemental products which the Member
may have bought independently from this SeniorPlus plan. If the
nature of the Member’s complaint deals with a Covered Service stated
in this SeniorPlus or the level of payment associated with this plan,
please refer to the Medicare Appeals procedure, stated in Section X.”
Source: Siegel & Gale
Is
“If you have a complaint about quality of service received,
waiting times, physician behavior, or the adequacy of
medical facilities, please use our grievance process.
“lf you have a complaint about coverage or payment,
please use the Medicare Appeals procedure (see Section
X).”
Source: Siegel & Gale
12. “It” all adds up
to … THE
BRAND.
The Heart of
Branding …
“WHO ARE
WE?”
“Most companies tend to equate branding with the
company’s marketing. Design a new marketing
campaign and, voilà, you’re on course. They are
wrong. The task is much bigger. It is about fulfilling our
potential … not about a new logo, no matter how
clever. WHAT IS MY MISSION IN LIFE? WHAT
DO I WANT TO CONVEY TO PEOPLE? HOW DO
I MAKE SURE THAT WHAT I HAVE TO OFFER
THE WORLD IS ACTUALLY UNIQUE? The brand
has to give of itself, the company has to give of
itself, the management has to give of itself. To
put it bluntly, it is a matter of whether – or not –
you want to be … UNIQUE … NOW.”
Jesper Kunde, A Unique Moment
“WHAT’S
OUR
STORY?”
“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
Companies will
thrive on the basis of their stories
and myths. Companies will need to understand
to how we work with others.
that their products are less important than
their stories.”
Rolf Jensen, Copenhagen Institute for Future Studies
“Apple opposes, IBM solves,
Nike exhorts, Virgin enlightens,
Sony dreams, Benetton
protests.
… Brands are
not nouns but verbs.”
Source: Jean-Marie Dru, Disruption
ALL
‘BUSINESS MODELS’
ARE IN FACT …
BRAND
STATEMENTS!
Message:
DO THE
HOUSEKEEPERS
& CLERKS “BUY
IT”?
[ARE YOU V-E-R-Y SURE?]
“EXACTLY
HOW ARE WE
DRAMATICALLY
DIFFERENT?”
1st Law Mktg Physics: OVERT BENEFIT (Focus: 1 or
2 > 3 or 4/“One Great Thing.”
Source #1: Personal Passion)
2ND Law: REAL REASON TO BELIEVE (Stand &
Deliver!)
RD
3
Law: DRAMATIC
DIFFERENCE (Execs Don’t Get It:
See the next slide.)
Source: Jump Start Your Business Brain, Doug Hall
2 Questions:
“How likely are you to
purchase this new product or
service?” (95% to 100% weighting by execs)
“How unique is this new
product or service?” (0% to 5%*)
*No exceptions in 20 years – Doug Hall,
Jump Start Your Business Brain
“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
“A great company
is defined by the
fact that it
is not compared
to its peers.”
Phil Purcell, Morgan Stanley
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’re not going to be driven
by where we think a funding
agency would like to see us go.
We’re going to build our case …
and then find an organization
that agrees with us.”
Stephen Spongberg, Polly Hill Arboretum
“WHY DOES IT
MATTER TO
THE CLIENT?”
“EXACTLY HOW DO I
PASSIONATELY
CONVEY THAT
DRAMATIC
DIFFERENCE TO THE
CLIENT ?”
“Brand Promise” Exercise: (1) Who
Are WE? (poem/novella/song, then 25 words.)
(2) List three ways in which we are
UNIQUE … to our Clients. (3) Who
are THEY (competitors)? (ID, 25 words.)
(4) List 3 distinct “us”/“them”
differences. (5) Try “results” on
your teammates. (6) Try ’em on a
friendly Client. (7) Try ’em on a
skeptical Client!
Message: REAL Branding is personal.
REAL Branding is integrity. REAL
Branding is consistency & freshness.
REAL Branding is the answer to WHO
ARE WE? WHY ARE WE HERE? REAL
Branding is why I/you/we [all] get out of
bed in the morning. REAL Branding
can’t be faked. REAL Branding is
a systemic, 24/7, all departments,
all hands affair.
Rules of “Radical Marketing”
Love + Respect Your Customers!
Hire only Passionate Missionaries!
Create a Community of Customers!
Celebrate Craziness!
Be insanely True to the Brand!
Sam Hill & Glenn Rifkin, Radical Marketing
(e.g., Harley, Virgin, The Dead, HBS, NBA)
Branding: Is-Is Not “Table”
TNT is not:
TNT is:
TNT is not:
Juvenile
Contemporary
Mindless
Meaningful
Elitist
Predictable
Suspenseful
Dull
Frivolous
Exciting
Superficial
Powerful
Old-fashioned
Slow
Self-important
Message …
Is Not >> Is
“Salt is salt is salt. Right? Not when it
blue box
comes in a
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
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
V. NEW
BUSINESS.
NEW
MARKETS.
13. Trends I:
Women
Roar.
Women & the
Marketspace.
?????????
Home Furnishings … 94%
Vacations … 92% (Adventure Travel … 70%/ $55B travel
equipment)
Houses … 91%
D.I.Y. (“home projects”) … 80%
Consumer Electronics … 51%
Cars … 60% (90%)
All consumer purchases … 83%
Bank Account … 89%
Health Care … 80%
????
Riding Lawnmowers
2/3rds working women/
50+% working wives > 50%
80% checks
61% bills
53% stock (mutual fund boom)
43% > $500K
95% financial decisions/
29% single handed
1970-1998
Men’s median income: +0.6%
Women’s median income: + 63%
Source: Martha Barletta, Marketing to Women
$5+T > Japan
10M/28M/$3.6T
> Germany
Business Purchasing Power
Purchasing mgrs. & agents: 51%
HR: >>50%
Admin officers: >50%
Source: Martha Barletta, Marketing to Women
Women-owned Bus.
U.S. employees > F500
employees worldwide
Source: Martha Barletta, Marketing to Women
New golfers … 37%
Basketball … 13.5M
1 in 27 (’70) … 1 in 3 (’96)
1874 … Jock Strap
1977 … Jogbra
1977 ... 25K
1996 … 42
M
Yeow!
1970 … 1%
2002 …
50%
OPPORTUNITY
NO.
1!*
[* No shit!]
91% women:
ADVERTISERS DON’T
UNDERSTAND US.
(58% “ANNOYED.”)
Source: Greenfield Online for Arnold’s Women’s Insight Team
(Martha Barletta, Marketing to Women)
Carol Gilligan/ In a Different Voice
Men: Get away from authority, family
Women: Connect
Men: Self-oriented
Women: Other-oriented
Men: Rights
Women: Responsibilities
Men: Individual perspective. “Core
unit is ‘me.’ ”
Pride in self-reliance.
Women: Group perspective. “Core
unit is ‘we.’ ” Pride in team
accomplishment.
Source: Martha Barletta, Marketing to Women
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!)
“Shopping: A Guy’s Nightmare or a
Girl’s Dream Come True?”
“Buy it and be gone”
vs.
“Hang out and enjoy the
experience”
Source: The Charleston [WV] Gazette/06.22.2002
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
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’re marketing to
women entrepreneurs because it is
a huge opportunity.” — Cherie Piebes
Women's View of Male
Salespeople
Technically knowledgeable;
assertive; get to the point; pushy;
condescending; insensitive to
women’s needs.
Source: Judith Tingley, How to Sell to the Opposite Sex
(Martha Barletta, Marketing to Women)
Women as Healthcare Decision Makers
— read vociferously
— want choices
— value convenience
— look for small signs of sensitivity
(gowns that close)
Source: Cheryl Stone, Rynne Marketing Group
Women and Healthcare
— Women are more dissatisfied
— Women are frustrated by the way they
are treated and spoken to
by physicians
— Women seek more information
— Women are more pressed for time
— Women make most healthcare decisions
and purchases
Source: Patricia Braus, Marketing Health Care to Women
Women and Financial Advisors
Women want ...
— a plan
— to be listened to
— to read about it and think about it
Women do not want ...
— a high-pressure sales pitch
Source: Kathleen Boyd, SVP, Wheat First Butcher Singer (now part of Wachovia
Securities)
Read This: Barbara & Allan Pease’s
Why Men Don’t
Listen & Women
Can’t Read Maps
“It is obvious to a woman when
another woman is upset, while a man
generally has to physically witness
tears or a temper tantrum or be
slapped in the face before he even has
a clue that anything is going on. Like
most female mammals, women are
equipped with far more finely tuned
sensory skills than men.”
Barbara & Allan Pease, Why Men Don’t Listen & Women Can’t Read Maps
“Resting” State: 30%, 90%: “A
woman knows her children’s
friends, hopes, dreams, romances,
secret fears, what they are
thinking, how they are feeling. Men
are vaguely aware of some short
people also living in the house.”
Barbara & Allan Pease, Why Men Don’t Listen & Women Can’t Read Maps
“As a hunter, a man needed vision that
would allow him to zero in on targets in the
distance … whereas a woman needed eyes
to allow a wide arc of vision so that she
could monitor any predators sneaking up
on the nest. This is why modern men can
find their way effortlessly to a distant pub,
but can never find things in fridges,
cupboards or drawers.”
Barbara & Allan Pease, Why Men Don’t Listen & Women Can’t Read Maps
“Female hearing advantage
contributes significantly to what is
called ‘women’s intuition’ and is one
of the reasons why a woman can read
between the lines of what people say.
Men, however, shouldn’t despair.
They are excellent at imitating
animal sounds.”
Barbara & Allan Pease, Why Men Don’t Listen & Women Can’t Read Maps
Senses
Vision: Men, focused; Women,
peripheral.
Hearing: Women’s discomfort
level I/2 men’s.
Smell: Women >> Men.
Touch: Most sensitive man <
Least sensitive women.
Source: Martha Barletta, Marketing to Women
Sensitivity to differences: Twice as
many card stacks.
More “contextual,” “holistic.”
“People powered”: Age 3 days, baby
girls 2X eye contact.
Source: Martha Barletta, Marketing to Women
Barbara & Allan Pease, Why Men Don’t Listen &
Women Can’t Read Maps: Women love to
talk. Men talk silently to themselves.
Women think aloud. Women talk, men
feel nagged. Women multitask. Women are
indirect. Men are direct. Women talk
emotively, men are literal. Men listen like
statues. Boys like things, girls like
people. Boys compete, girls cooperate.
Men hate to be wrong. Men hide
their emotions.
“When a woman is upset,
she talks emotionally to
her friends; but an upset
man rebuilds a motor or
fixes a leaking tap.”
Barbara & Allan Pease, Why Men Don’t Listen &
Women Can’t Read Maps
Stress* **
Men: Fight or flee
Women: Seek the company of
friends
*Source: UCLA, “Female Response to Stress: Tend and
Befriend, Not Fight or Flight”/Psychological Review
**90% of stress research: men
We Really … Don’t Get It!
Review of “Unfaithful”: “ … the
latest entry in the category of
male directors’ clueless
fantasies concerning what
women fantasize about in their
nonexistent free time.”
Source: Julie Iovine, NYT (05.19.2002)
Men & Women on Thelma & Louise.
MEN: Sundance Kid; women who
get angry, swear, go to bars, leave
their mate. WOMEN: women
controlled by the men in their lives,
who would rather be dead than
oppressed.
Source: Judy Rosener,
America’s Competitive Secret
[“The Hollywood scripts that
men write tend to be direct and
linear, while women’s
compositions have many
conflicts, many climaxes, and
many endings.”
Helen Fisher, The First Sex: The Natural
Talents of Women and How They Are
Changing the World]
“Women speak and hear a language of
connection and intimacy, and men
speak and hear a language of status
and independence. Men communicate
to obtain information, establish their
status, and show independence.
Women communicate to create
relationships, encourage interaction,
and exchange feelings.”
Judy Rosener, America’s Competitive Secret
“I only really understand
myself, what I’m really thinking
and feeling, when I’ve talked it
over with my circle of female
friends. When days go by
without that connection, I feel
like a radio playing in an empty
room.”
Anna Quindlen
“Women are more
comfortable talking or
thinking about people and
relationships, while men
prefer to contemplate
things.” —research reported in the New York
Times (08.10.2003)
Editorial/Men: Tables, rankings.*
Editorial/Women: Narratives that
cohere.*
*Redwood (UK)
Initiate Purchase
Men: Study “facts & features.”
Women: Ask lots of people for
input.
Source: Martha Barletta, Marketing to Women
“Where the Girls Are:
They’re Online, Solving
Puzzles and Making Up
Characters in Narrativedriven Games” —Headline/WSJ/10.28
Storytelling: Men start
with the headline.
Women start with the
context.
Source: Martha Barletta, Marketing to Women
Cents & Sensibility
“Our advisory sessions [with
women] changed from a purely
analytical, male approach to
something that starts with the heart
and ends with the figures.”
Tomboy Tools. E.g.:
smaller, lighter in weight.
Tupperware “party” model.
“Darcy Winslow is a leading
figure in Nike Goddess, a
companywide grassroots team
whose goal is a once-and-for-all
shift in how a high-testosterone
outfit sells to, designs for, and
communicates with women.” —Fast
Company/08.2002
“Women weren’t comfortable in
our stores. So I figured out where
they would be comfortable—most
likely their own homes. The [first
Nike Goddess] store has more of a
residential feel. I wanted it to have
furniture, not fixtures. Above all, I
didn’t want it to be girlie.” —John Hoke,
designer, Nike
Read This Book …
EVEolution:
The Eight Truths of
Marketing to Women
Faith Popcorn & Lys Marigold
EVEolution: Truth No. 1
Connecting Your Female
Consumers to Each
Other Connects Them to
Your Brand
“The ‘Connection Proclivity’ in
women starts early. When asked,
‘How was school today?’ a girl
usually tells her mother every
detail of what happened, while a
boy might grunt, ‘Fine.’ ”
EVEolution
What If …
“What if ExxonMobil or Shell dipped into their
credit card database to help commuting women
interview and make a choice of car pool
partners?”
“What if American Express made a concerted
effort to connect up female empty-nesters
through on-line and off-line programs, geared to
help women re-enter the workforce with today’s
skills?”
EVEolution
2.6
vs.
The New New Jiffy Lube
“In the male mold, Jiffy Lube was going all out
to deliver quick, efficient service. But, in the
female mold, women were being turned off by
the ‘let’s get it fixed fast, no conversation
required’ experience.”
New JL: “Control over her environment.
Comfort in the service setting. Trust that her car
is being serviced properly. Respect for her
intelligence and ability.”
EVEolution
Lowe’s …
Gets it.
1989:
13%/“lumber shop” … 2002: >50%
“War has broken out over
your home-improvement
dollar, and Lowe’s has
superpower Home Depot on
the defensive. It’s not-so-
secret ploy: Lure
women.” —Forbes.com
“Home Depot is still very much a guy’s
chain. But women, according to Lowe’s
research, initiate 80 percent of all homeimprovement purchase decisions,
especially the big ticket orders like kitchen
cabinets, flooring and bathrooms. ‘We
focused on a customer nobody in home
improvement has focused on. Don’t get me
wrong, but women are far more
discriminating than men,’ says CEO Robert
Tillman, 59, a Lowe’s lifer.” —Forbes.com
“Women’s Work: Do-ityourself has become do-itherself, and toolmakers are
taking notice” —Headline/San Francisco
Chronicle/08.03
Yes!: “Crest Spinoff Targets
Women”—cover story,
Ad Age/06.03.02
Crest Rejuvenating Effects.
“Chicks in charge” team.
$50M launch. Packaging.
Taste. Features.
“Mattel Sees Untapped Market for
Blocks: Little Girls”—Headline,
WSJ/04.06.02
“Last year more than 90% of Lego sets
purchased were for boys. Mattel says
Ello—with interconnecting plastic
squares, balls, triangles, squiggles,
flowers and sticks, in pastel colors and
with rounded corners—will go beyond
Lego’s linear play patterns.”
“Volvo Teams Up to Build
What Women Want:
Concept Car Goes for
Great Storage, Easy
Maintenance” —headline/USA
Today/12.16.2003/140-person team;80%
women
“Women don’t buy
They
join them.”
brands.
EVEolution
Purchasing Patterns
Women: Harder to convince; more
loyal once convinced.
Men: Snap decision; fickle.
Source: Martha Barletta, Marketing to Women
Not
!
“Year of the
Woman”
Enterprise Reinvention!
Recruiting
Hiring/Rewarding/Promoting
Structure
Processes
Measurement
Strategy
Culture
Vision
Leadership
THE BRAND ITSELF!
“Honey, are you
sure you have the
kind of money it
takes to be
looking at a car
like this?”
STATEMENT OF PHILOSOPHY: I am a
businessperson. An analyst. A pragmatist. The
enormous social good of increased women’s
power is clear to me; but it is not my bailiwick.
My “game” is haranguing business leaders
about my fact-based conviction that women’s
increasing power – leadership skills
and purchasing power – is the strongest and
most dynamic force at work in the American
economy today. Dare I say it as a long-time Palo
Alto resident … THIS IS EVEN BIGGER THAN
THE INTERNET!
Tom Peters
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!”
“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
Psssst! Wanna
see my “porn”
collection?
Norwegian Law: Boards must have
at least
women.
Duh!
“We want our associate population to mirror our
customer population at every level, from the executive
suite all the way to the retail floor. In the marketplace,
basically what I want to do is draw a concentric circle
around every one of our 2,300 stores, and I want the
assortment in that store to match the ethnicity of the
neighborhood it’s in. Some neighborhoods are all
Hispanic, so we can put in a full Hispanic format. That’s
what Super Saver is. All the signage is in both
languages. There’s a 100 percent Spanish-speaking
staff in the store.”—Larry Johnston, CEO, Albertson’s
Ass Of The Year2002: Maurice Greenberg, A.I.G.,
on the Company’s New (All Male) Leadership Team
“In a lot of countries of the world, it
would be very difficult for a woman to
be a good CEO. … I have a
responsibility to do the best we can for
shareholders.” * **
*Source: New York Times/05.05.02
**Wouldn’t you love to watch him tell that … face-toface … to Margaret Thatcher or Carly Fiorina? (I would.)
Ad from Furniture /Today (04.01):
“MEET WITH THE EXPERTS!: How
Retailing’s Most Successful Stay that Way”
Presenting Experts: M =
F=
??
16;
(94% = 272)
“Each time a ‘women’s movie’ is
a success [e.g., First Wives
Club] everybody is surprised all
over again. But if any action
movie is a hit, it instantly
spawns a dozen knockoffs.” —
Exec [F], major Hollywood studio
Stupid!
Stupid: “Amazing, now that I
think about it. A bunch of
guys --developers, architects,
contractors, engineers,
bankers--sitting around
designing shopping centers.
And the ‘end users’ will be
overwhelmingly women!”
Instructions: 1. Purchase ticket to
symphony … 7:30 p.m. show. 2.
Drink three large bottles of water
between 3 p.m. and 7 p.m.
3. X-dress. 4. Wait in queue at
Ladies at Intermission. 5. Realize
what total wretches you are.
6. Seize a microphone and
apologize publicly to every woman
in the hall.
“Customer is King”:
4,440
“Customer is Queen”:
29
Source: Steve Farber/Google search/04.2002
“Women Beat Men
at Art of Investing”
Source: Miami Herald, reporting on a study by
Profs. Terrance Odean and Brad Barber, UC
Davis (Cause: Guys are “in and out” of
stocks more often; women choose
carefully and hold on for the long term)
Investment Club Returns
Women-only clubs 1997 … 17.9%
Mixed … 17.3%
Men-only … 15.6%
Source: National Assoc. Investors
Value Line: Top State* Investment
Clubs 2000
8 … All male
19 … Coed
22 … All FEMALE
* VT & Maine not included; D.C. included
JBQ: Stop Treating Women Investors Like Idiots!
“Why all this focus on women and our lack of
investment guts? A far greater problem, it seems to
me, is trigger-happy speculation, mostly by men.
The kind of guys whose family savings went south
with the dot-coms. Imagine a list of their money
mistakes: Shoot from the hip. Overtrade their
accounts. Believe they’re smarter than the market.
Think with their mouse rather than their brain.
Praise their own genius when stocks go up. Hide
their mistakes from their wives.”
Source: Newsweek 01.08.01
Notes to the CEO
--Women are not a “niche”; so get this out of
the “Specialty Markets” group.
--The competition is starting to catch on.
(E.g.: Nike, Nokia, Wachovia, Ford, Harley-Davidson, Jiffy Lube,
Charles Schwab, Citigroup, Aetna.)
--If you “dip your toes in the water,” what makes
you think you’ll get splashy results?
--Bust through the walls of the corporate silos.
--Once you get her, don’t let her slip away.
--Women ARE the long run!
Source: Martha Barletta, Marketing to Women
1. Men and women are different.
2. Very different.
3. VERY, VERY DIFFERENT.
4. Women & Men have a-b-s-o-l-u-t-e-l-y
nothing in common.
5. Women buy lotsa stuff.
6. WOMEN BUY A-L-L THE STUFF.
7. Women’s Market = Opportunity No. 1.
8. Men are (STILL) in charge.
9. MEN ARE … TOTALLY, HOPELESSLY
CLUELESS ABOUT WOMEN.
10. Women’s Market = Opportunity No. 1.
14. Trends II:
Boomer
Bonanza/
Godzilla Geezer.
Subject: Marketers & Stupidity
“It’s 18-44,
stupid!”
Subject: Marketers & Stupidity
“18-44 is
stupid,
stupid!”
Or is it:
2000-2010 Stats
18-44: -1%
55+: +21%
(55-64: +47%)
Aging/“Elderly”
$$$$$$$$$$$$
“I’m in charge!”
“NOT ACTING THEIR
AGE: As Baby Boomers
Zoom into Retirement,
Will America Ever Be the
Same?”
USN&WR Cover/06.01
“Sixty Is the
New Thirty”
—Cover/AARP/11.03
Member Growth: 1987 – 1997
18 – 34: 26%
35 – 49: 63%
50+: 118%
Source: IHRSA
50+
$7T wealth (70%)/$2T annual income
50% all discretionary spending
79% own homes/40M credit card users
41% new cars/48% luxury cars
$610B healthcare spending/
74% prescription drugs
5% of advertising targets
Ken Dychtwald, Age Power: How the 21st
Century Will Be Ruled by the New Old
“Advertisers pay more to reach the kid
because they think that once someone hits
middle age he’s too set in his ways to be
susceptible to advertising. … In fact,
this notion of impressionable kids
and hidebound geezers is little
more than a fairy tale, a Madison
Avenue gloss on Hollywood’s cult
of youth.”—James Surowiecki (The New
Yorker/04.01.2002)
Read This!
Carol Morgan &
Doran Levy,
Marketing to the
Mindset of Boomers
and Their Elders
“Marketers attempts at
reaching those over 50 have
been miserably
unsuccessful. No market’s
motivations and needs are
so poorly understood.”—Peter
Francese, founding publisher, American Demographics
“Households headed by someone
40 or older enjoy 91% ($9.7T) of
our population’s net worth. … The
mature market is the dominant
market in the U.S. economy,
making the majority of
expenditures in virtually every
category.” —Carol Morgan & Doran Levy, Marketing to
the Mindset of Boomers and Their Elders
“The mature market
cannot be dismissed
as entrenched in its
brand loyalties.”
—Carol Morgan &
Doran Levy, Marketing to the Mindset of Boomers and Their
Elders
“Focused on assessing the
marketplace based on lifetime
value (LTV), marketers may
dismiss the mature market as
headed to its grave. The reality is
that at 60 a person in the U.S. may
enjoy 20 or 30 years of life.” —Carol
Morgan & Doran Levy, Marketing to the Mindset of Boomers and
Their Elders
“While the average American age
12 or older watched at least five
movies per year in a theater, those
40 and older were the most
frequent moviegoers, viewing 12
or more a year.”—Carol Morgan & Doran Levy,
Marketing to the Mindset of Boomers and Their Elders
“Women 65 and older spent $14.7
billion on apparel in 1999, almost as
much as that spent by 25- to 34-yearolds. While spending by the older
women increased by 12% from the
previous year, that of the younger
group increased by only 0.1%. But
who in the fashion industry is
currently pursuing this market?” —Carol
Morgan & Doran Levy, Marketing to the Mindset of Boomers and
Their Elders
“Take the Road Less
Traveled”—Advertising Age
headline re Sony, upon
targeting “Zoomers,” the
neglected 34% of
its customers who are
age 50+
“ ‘Age Power’ will
st
21
rule the
century,
and we are woefully
unprepared.”
Ken Dychtwald, Age Power: How the 21st
Century Will Be Ruled by the New Old
No: “Target Marketing”
Yes:
“Target
Innovation” & “Target
Delivery Systems”
“Elderly”
— Purchase “experiences” more than
just “things”
— Convenience / Comfort / Access /
Need to be
appreciated = Top Priorities
Source: Ken Dychtwald, Age Wave
“The baby-boom
generation is the
first wellness
generation.”
—Paul Zane Pilzer/
The Wellness Revolution: The Next Trillion Dollar Industry
Wellness = $$$$$$$$
Currently $200B,
$1T by 2013
(Source: Paul Zane
Pilzer, The Wellness Revolution: The Next Trillion Dollar
Industry)
The Growing Wellness Obsession
Sprint/Overland Park KS:
slow elevators, distant
parking lots, long way to
food court
Source: NYT/10.12.03
Hispanics:
38.5%
growth, 1990-2000, vs. 9.3%
overall*
*Source: Communispace/2003
“BofA Is Betting Its Future on the
Hispanic Market” *
“We expect to get no less than
80 % of our future growth in
retail banking from the Hispanic
market.” —Ken Lewis, CEO, BofA
*Fortune/04.2003
“Relative to the
demand, the success
stories are pitifully
few” —Andrew Nuttney, Research Director, The
Research & Advisory Group; on marketing effectively
to Hispanics
VI. NEW
BUSINESS. NEW
WORK.
15. Toward Work
that Matters: The
WOW Project.
“Reward excellent
failures. Punish
mediocre
successes.”
Phil Daniels, Sydney exec
Language
matters! Wow!
BHAG! “Takes
your breath
away!”
“Let’s make a
dent in the
universe.”
Steve Jobs
Your Current Project?
1. Another day’s work/Pays the
rent.
4. Of value.
7. Pretty Damn Cool/Definitely
subversive.
10. WE AIM TO CHANGE THE
WORLD. (Insane!/Insanely
Great!/WOW!)
Measures
–WOW!
–Beauty!
–Raving Fans!
–Impact!
Language
matters!
“We shape our
buildings. Thereafter
they shape us.”—WSC
“We shape our
words. Thereafter
they shape
us.”—TJP
“Astonish me!” / S.D.
“Build something great!” /
H.Y.
“Immortal!” / D.O.
Legacy
TP: “Your ‘signature’ is not
‘I work for Dow.’ It’s, ‘’I
accomplished [INCREDIBLY
COOL PROJECT] while I
was associated with Dow.’”*
*Terms: Signature. Portfolio. Projects. Braggables.
Herman Edwards: “I picked up one of
those Jets books and I told them, ‘What
you do as a football team is your legacy.
When you’re 80 years old, what you’ve
done will be in this book and no one can
take that away from you. Your grandkids,
your kids after that, they will know what
you did. It’s about leaving your name in
stone.”
Source: The New York Times (12.31.02)
NEW WORK
… NEW
SPACES
“The fact is, a person is so far
formed by his surroundings,
that his state of harmony
depends entirely on his
harmony with his
surroundings.” —Christopher
Alexander, The Timeless Way of Building
“What the dot-com boom made
vivid was that a significant portion
of the workforce was
disenchanted with the
conventional office landscape and
was looking for a viable alternative
to the cubicle.” —Lise Anne Couture,
designer/Metropolis/“Reimagining Work”/11.2002
“I think it’s a chicken and egg
proposition: do furniture
manufacturers make cubes
because of the demand, or is the
demand there because it’s
artificially created by the absence
of any real alternatives?” —Lise Anne
Couture, designer/Metropolis/“Reimagining
Work”/11.2002
Why Not?
“My ideal office wouldn’t
have a chair. You would do
two things there: stand up
or lie down. These are the
body’s most natural
positions.” —Niels Diffrient, designer and
F500 consultant/Metropolis/“Reimagining
Work”/11.2002
16. WOW
Projects for the
“Powerless”: A
Surefire Recipe.
Topic: Boss-free
Implementation of
STM /Stuff That
MATTERS!
World’s Biggest Waste …
Selling “Up”
THE IDEA:
Model F4
Find a Fellow
Freak Faraway
F2F!/K2K!/
[email protected]/R.F!A.*
*Freak to Freak/ Kook to Kook/ One at a Time/ Ready.Fire!Aim.
And …
K2KK*
S2SS**
*Kook to Kooky Kustomer
**Skunk to Scintillating Supplier
BOTTOM LINE
The Enemy!
Joe J. Jones
1942 – 2003
HE WOULDA DONE SOME
REALLY COOL STUFF
BUT …
HIS BOSS WOULDN’T
HIM!
LET
Characteristics of the “Also rans”*
“Minimize risk”
“Respect the chain of
command”
“Support the boss”
“Make budget”
*Fortune, article on “Most Admired Global Corporations”
Kurt Carlson to
young Marilyn
Carlson: “If you don’t
like Sunday School,
change it!” (She did.)
“Nobody gives you
power. You just
take it.”—Roseanne
“ ‘Obeying the rules’ is
obeying their rules.
[Women] can never be
powerful as long as they try
to be in charge in the same
way men take charge.”
Harriet Rubin,
The Princessa: Machiavelli for Women
“Conformity is the
jailer of freedom and
the enemy of
growth.”
— J.F.K.
The greatest danger
for most of us
is not that our aim is
too high
and we miss it,
but that it is
too low
and we reach it.
Michelangelo
Epitaphs
from
Hell
Joe J. Jones
1942 – 2002
HE WOULDA DONE SOME
REALLY COOL STUFF
BUT …
HIS BOSS WOULDN’T
LET HIM!
Joe J. Jones
1942 – 2002
HE MADE BUDGET!
(AGAIN & AGAIN.)
Joe J. Jones
1942 – 2002
HIS NET WORTH WAS
$11,000,000.
Joe J. Jones
1942 – 2002
HE HIT QUARTERLY
EARNINGS TARGETS 44
TIMES IN A ROW.
WHO WILL GO TO
STOCKHOLM? (Damn it.)
If you are not
prepared to be
fired over your
beliefs … you are
working on the
wrong project - TP
“To Be
somebody or to
Do something”
BOYD: The Fighter Pilot Who Changed
the Art of War (Robert Coram)
IMPLEMENTATION
SECRETS. Credibility. Demos
& End Runs & Being There. Mr.
OSHA Maine. Find three COs. Seek
determined alumnae. Go to
Bangkok. (Forget: “How do I
erase the old?” Supplant rather
than change the regnant
heirarchs.)
It’s politics,
stupid!
(Play or sit on the sidelines.)
17. Bringing WOW
Work to Fruition:
The Sales
25.
The Sales25: Great Salespeople …
1. Know the product. (Find cool mentors, and use them.)
2. Know the company.
3. Know the customer. (Including the customer’s
consultants.) (And especially the “corporate culture.”)
4. Love internal politics at home and abroad.
5. Religiously respect competitors. (No badmouthing, no
matter how provoked.)
6. Wire the customer’s org. (Relationships at all levels &
functions.)
7. Wire the home team’s org. and vendors’ orgs.
(INVEST Big Time time in relationships at all levels & functions.)
(Take junior people in all functions to client meetings.)
It’s politics,
stupid!
(Play or sit on the sidelines.)
Great Salespeople …
8. Never overpromise. (Even if it costs you your job.)
9. Sell only by solving problems-creating profitable
opportunities. (“Our product solves these problems, creates
these unimagined INCREDIBLE opportunities, and will make you
a ton of money—here’s exactly how.”) (IS THIS A “PRODUCT
SALE” OR A WOW-ORIGINAL SOLUTION YOU’LL BE DINING OFF
5 YEARS FROM NOW? THAT WILL BE WRITTEN UP IN THE
TRADE PRESS?)
10. Will involve anybody—including mortal enemies—if
it enhances the scope of the problem we can solve and
increases the scope of the opportunity we can
encompass.
11. Know the Brand Story cold; live the Brand Story. (If
not, leave.)
Great Salespeople …
12. Think “Turnkey.” (It’s always your problem!)
13. Act as “orchestra conductor”: You are responsible
for making the whole-damn-network respond. (PERIOD.)
14. Help the customer get to know the vendor’s
organization & build up their Rolodex.
15. Walk away from bad business. (Even if it gets you fired.)
16. Understand the idea of a “good loss.” (A bold effort
that’s sometimes better than a lousy win.)
17. Think those who regularly say “It’s all a price issue”
suffer from rampant immaturity & shrunken imagination.
18. Will not give away the store to get a foot in the door.
19. Are wary & respectful of upstarts—the real enemy.
20. Seek several “cool customers”—who’ll drag you into
Tomorrowland.
Great Salespeople …
21. Use the word “partnership” obsessively, even
though it is way overused. (“Partnership” includes folks at
all levels throughout the supply chain.)
22. Send thank you notes by the truckload. (NOT ENOTES.) (Most are for “little things.”) (50% of those notes are
sent to those in our company!) Remember birthdays. Use
the word “we.”
23. When you look across the table at the customer,
think religiously to yourself: “HOW CAN I MAKE THIS
DUDE RICH & FAMOUS & GET HIM-HER PROMOTED?”
24. Great salespeople can affirmatively respond to the
query in an HP banner ad: HAVE YOU CHANGED
CIVILIZATION TODAY?
25. Keep your bloody PowerPoint slides simple!
18. Boss Work:
Demos, Heroes,
Stories … Or: Starting
a WOW Projects
Epidemic.
“Ordering”
Systemic Change
is a Stupid Waste
of Time!
Premise:
Demos!
Heroes!
Stories!
“Lead
Frogs”
Leapfrog Group:
Demo = Story
“A key – perhaps the key –
to leadership is the
effective communication
of a story.”
Howard Gardner, Leading Minds: An Anatomy of Leadership
MB
A!*
*Managing By Story-ing Around/David Armstrong
Culture of Prototyping
“Effective prototyping may be
the most valuable
core competence an
innovative organization can
hope to have.”
Michael Schrage
Think about It!?
Innovation = Reaction to
the Prototype
Michael Schrage
He who has the
quickest O.O.D.A.
Loops* wins!
*Observe. Orient. Decide. Act. /
Col. John Boyd
“Find something small
that you can turn
around. If you’re on a 9game losing streak, you
need to start with one
great inning.”—Rudy
REAL Org Change: Demos & Models (“Model
Installations,” “ReGo Labs”)/ Heroes (mostly extant: “burned
to reinvent gov’t”)/ Stories & Storytellers (Props!)/
Chroniclers (Writers, Videographers, Pamphleteers, Etc.)/
Cheerleaders & Recognition (Pos>>Neg, Volume)/
New Language (Hot/Emotional/WOW)/ Seekers
(networking mania)/ Protectors/ Support Groups/
End Runs—“Pull Strategy” (weird alliances, weird
customers, weird suppliers, weird alumnae-JKC)/ Field
“Real People” Focus (3 COs) (long way away)/
Speed (O.O.D.A. Loops—act before the “bad guys” can react)
C.f., Bob Stone, Lessons from an Uncivil Servant
JKC
1. Scour for renegades;
wine & dine.
2. Go outside for funds.
“Some people look for
things that went wrong and
I look for
things that went right
and try to build on
them.”
try to fix them.
—Bob Stone/ Mr.Rego/ Lessons from an
Uncivil Servant
Stories … Paint me a picture …
Story “infrastructure” … Demos …
Quick prototypes … Experiments
… Heroes … Renegades …
Leadfrogs … Skunkworks …
Demo Funds … V.C. … G.M. …
Roster … Portfolio … Stone’s
Rules … JKC’s Rules
GSK Mimics Biotechs
Licensing folded into R & D (deals at 2X
rate of nearest rival)
Six Centers of Excellence: SWAT Teams of
280 to 450 people
10 to 15 human test candidates to 25 to 30;
GSK: 62 candidates in Phase I or II trials
(Pfizer 26, Novartis 24)
Source: Forbes
Upheaval in Big Pharma
$45B R & D (2X 1993); but
launches down from 52 to 31
50 targets with 100 references to
200 targets with 8 refs (genomics)
Source: Forbes
Shell
Game Changer
10% of technical budget “set aside
and used to fund promising but
nontraditional ideas through a
staged funding process similar to
that used by venture capitalists”
Source: Financial Times/08.2003
VII. NEW
BUSINESS. NEW
YOU.
19. Re-inventing the
Individual: Welcome
to a Brand You World
“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
“What strategic motto will dominate this
transition from nation-state to marketstate? If the slogan that animated the
liberal, parliamentary nation-states was
‘make the world safe for democracy,’ what
will the forthcoming motto be? Perhaps
‘making the world available,’ which is to
say creating new worlds of choice and
protecting the autonomy of persons to
choose.” —Philip Bobbitt, The Shield of Achilles:
War, Peace, and the Course of History
“better material
welfare” vs. “maximize
the opportunity of its
people”
—Philip Bobbitt, The Shield of Achilles:
War, Peace, and the Course of History
“In a global economy, the
government cannot give
anybody a guaranteed success
story, but you can give people
the tools to make the most of
their own lives.” —WJC, from Philip Bobbitt,
The Shield of Achilles: War, Peace, and the Course of History
Country
Guarantee No One Is in Need
U.S.A.
Germany
France
UK
Italy
35%
58%
61%
61%
65%
Source: Economist/11.08.2003
Provide Freedom to Pursue Goals
58%
38%
36%
35%
22%
New World of Work
< 1 in 10 F500
#1: Manpower Inc.
Freelancers/I.C.: 16M-25M
Temps: 3M (incl. CEOs & lawyers)
Microbusinesses: 12M-27M
Total: 31M-55M
Source: Daniel Pink, Free Agent Nation
“JUST GOT LAID
OFF? HIRE
YOURSELF!”—Cover
story, Forbes, 12 May 2003
Minimum New Work SurvivalSkillsKit2003
Mastery
Rolodex Obsession (vert. to horiz. “loyalty”)
Entrepreneurial Instinct
CEO/Leader/Businessperson/Closer
Mistress of Improv
Sense of Humor
Intense Appetite for Technology
Groveling Before the Young
Embracing “Marketing”
Passion for Renewal
Sam’s
Secret #1!
Minimum New Work SurvivalSkillsKit2003
Mastery
Rolodex Obsession (vert. to horiz. “loyalty”)
Entrepreneurial Instinct
CEO/Leader/Businessperson/Closer
Mistress of Improv
Sense of Humor
Intense Appetite for Technology
Groveling Before the Young
Embracing “Marketing”
Passion for Renewal
“My ancestors were printers in
Amsterdam from 1510 or so until
1750, and
during that
entire time they didn’t
have to learn anything
new.”
Peter Drucker, Business 2.0 (08.22.00)
“Knowledge becomes obsolete
incredibly fast. The
continuing professional
education of adults is the
No. 1 industry in the next 30
years … mostly on line.”
Peter Drucker,
Business 2.0 (22August2000)
3 Weeks in May
“Training” & Prep: 187
“Work”: 41
(“Other”: 17)
USN&WR/What traits do successful
activists share?
“They
have hope, and
they imbue others
with hope.”
Studs Terkel, age 91:
Prep: 1 hour per 1 minute (WSC)
“Forget ‘practice makes perfect.’
Substitute ‘perfect practice makes
perfect.’ ” (TT) “Major difference
between ‘best’ and ‘average’?
‘Best’ get as much pleasure from
practice as performance.” —Ben Zander
1%
vs.
367%
Divas do it. Violinists do it.
Sprinters do it. Golfers do it.
Pilots do it. Soldiers do it.
Surgeons do it. Cops do it.
Astronauts do it. Why don’t
businesspeople do it?
Edward Jones’ Training Machine*
146 hours/employee/year
New hires: 4X avg.
3.8% of payroll
* #1, “The 100 Best Companies To Work
For”/Fortune/01.2003
R.D.A.
Rate: 15%?, 25%?
Therefore: Formal “Investment
Strategy”/R.I.P.
Invent. Reinvent. Repeat.
Source: HP banner ad
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 …
T.T.D./Assignment
Construct a 1/8-page or
1/4-page ad for
Brand You … for the
Yellow Pages
The Rule of Positioning
“If you can’t describe your
position in eight words or less,
you don’t have a position.”
— Jay Levinson and Seth Godin, Get What You
Deserve!
“You are the storyteller
of your own life, and you
can create your own
legend or not.”
Isabel Allende
“Our deepest fear is that we are powerful beyond
measure. It is our light not our darkness that
frightens us most. We ask ourselves who am I to
be brilliant, gorgeous, talented, fabulous?
Actually who are you not to be? You are a child
of the Earth. Your playing small does not serve
the world. … We are all meant to shine as
children do. And as we shine we unconsciously
give other people permission to do the same. As
we are liberated from our own fear, our presence
automatically liberates others.” —Marianne Williamson
“My education was a
prolonged and concerted
attack on my
individuality.”
—Neil Crofts, Authentic
“Thinking about standing up and telling the world what
you stand for is daunting. Actually doing it is
frightening, but the rewards are incredible. The whole
of my previous career, perhaps the whole of my life I
realize I have held back from being honest about my
beliefs. I have held back for fear of ridicule.You know
the sort of playground ridicule that comes from
standing up in any small way. Most of us seem to
be coerced into conformity from a very early age
by the dragon of normality. I call it a dragon not
because it breathes fire or even because it is
particularly nasty but because it is entirely fictitious.
There is no normal. There is no right that is more right
than your right.” —Neil Crofts, Authentic
“Carpenters bend wood;
fletchers bend arrows; wise
men fashion themselves.”
— Buddha
“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
Thriving in 24/7 (Sally Helgesen)
START AT THE CORE. Nimbleness only possible if we
“locate our inner voice,” take regular inventory of
where we are.
LEARN TO ZIGZAG. Think “gigs.” Think lifelong
learning. Forget “old loyalty.” Work on optimism.
CREATE OUR OWN WORK. Articulate your value.
Integrate your passions. I.D. your market. Run your
own business.
WEAVE A STRONG WEB OF INCLUSION. Build your
own support network. Master the art of “looking
people up.”
THE I work for a
company called Me
STREET JOURNAL
Adventures in Capitalism
THE rise up and flee
your cubicle STREET
JOURNAL
Adventures in Capitalism
Bill Parcells’ World/
Brand You World!
BLAME NOBODY!
EXPECT NOTHING!
DO SOMETHING!
NY Post (9/99)
In Store: International Equality, Intranational Inequality
“The new organization of society implied by the triumph
of individual autonomy and the true equalization of
opportunity based upon merit will lead to very great
rewards for merit and great individual autonomy. This
will leave individuals far more responsible for
themselves than they have been accustomed to being
during the industrial period. It will also reduce the
unearned advantage in living standards that has been
enjoyed by residents of advanced industrial societies
throughout the 20th century.”
James Davidson & William Rees-Mogg,The Sovereign Individual
Emerson
“For Marx, the path to social betterment was
through collective resistance of the proletariat to
the economic injustices of the capitalist system
that produced such misshapenness and
fragmentation. For Emerson, the key was to jolt
individuals into realizing the untapped power of
energy, knowledge and creativity of which all
people, at least in principle, are capable. He too
hated all systems of human oppression; but his
central project, and the basis of his legacy, was
to unchain individual minds.” —Lawrence Buell, Emerson
“ ‘The idea of eloquence’ is ‘to alter in a pair of hours,
perhaps in a half hour’s discourse, the convictions and
habits of years.’ Not that this often actually happens,
but such is always the hope. … ‘There is for every man
a statement possible, so broad and so pungent that he
cannot get away from it, but must either bend to it or
die of it.’ For this to work, the speaker’s mind must be
‘inflamed by the contemplation of the whole’ so that
sentences ‘fall from him as unregarded parts of that
terrible whole which he sees and which he means that
you shall see.’ … Nothing less than the perfection of
humankind was eloquence’s ultimate goal.” —Lawrence Buell,
Emerson
“In all my lectures, I have
taught one doctrine, the
infinitude of the private
man.”
—R. W. Emerson
“Though everyone falls
short of self-realization
much of the time, everyone
has self-transformative
capacity.” —Lawrence Buell, Emerson
“Emerson presupposes a state of of timid,
unhappy conformity. By adulthood, people are
conditioned to look through other people’s
eyes. … So the first move is to disengage
yourself fom the influence of others’ opinions.
Emerson biographer Robert Richardson calls
this ‘ground won back from dependency.’ …
The second step involves trusting instinct more
and reasoned judgment less, because at the
level of laborious formal argument you’re liable
to become mastered by forces alien to
yourself.” —Lawrence Buell, Emerson
“Emerson clearly believes that
individual acts of principled
repudiation of conformity by
individuals will have ripple
effects.” —Lawrence Buell, Emerson
“Self-reliance never comes ‘naturally’ to
adults because they have been so
conditioned to think non-authentically that
it feels wrenching to do otherwise. … Self
Reliance is a last resort to which a person
is driven in desperation only when he or
she realizes ‘that imitation is suicide, that
he must take himself for better, for worse,
as his portion.’ ” —Lawrence Buell, Emerson
“Every actual State is
corrupt. Good men must
must not obey the laws too
well.” —R. W. Emerson
20. Boss Job One:
The Talent
Obsession.
“When land was the scarce
resource, nations battled
over it. The same is
happening now for
talented people.”
Stan Davis & Christopher Meyer, futureWEALTH
“Historically, smart
people have always
turned to where the
money was. Today,
money is turning to
where the smart people
are.” —FT/06.03.03
“In a curious reversal, instead of
people moving to jobs, I was
finding that companies were
moving to or forming in places
that had skilled people.” —Richard
Florida, The Rise of the Creative Class
“The Creative Class derives its
identity from its members’ roles as
purveyors of creativity. Because
creativity is the driving force of
economic growth, in terms of
influence the Creative Class has
become the dominant class in
society.” —Richard Florida, The Rise of the Creative
Class (38M, 30%)
“Seller’s Market”: Tomorrow’s Headline*
“Molecular biologists are
up 3 points, economists
down 1/4, in
moderate trading”
*futureWEALTH, Stan Davis and
Christopher Meyer
AFTER A JOBLEES
RECOVERY, A WAR
FOR TALENT
—Headline, BW/09.29.03
Age of Agriculture
Industrial Age
Age of Information Intensification
Age of Creation Intensification
Source: Murikami Teruyasu, Nomura Research Institute
Brand =
Talent.
Talent!
Tina Brown: “The
first thing
to do is to hire enough
talent that a critical mass
of excitement starts to
grow.”
Source: Business2.0/12.2002-01.2003
“Ivy Envy: If you want to make
yourself the world’s first global
university in the world’s first global
city—and New York University
does—start with your economics
department and try a Yankees-like
acquisition of talent” —Headline/New York
Times Magazine/06.03
The Talent Ten
1. Obsession
P.O.T.* = All
Consuming
*Pursuit of Talent
Model
25/8/53
Sports Franchise GM*
*48 = $500M
“In most companies, the Talent Review
Process is a farce. At GE, Jack Welch and
his two top HR people visit each division
for a day. They review the top 20 to 50
people by name. They talk about Talent
Pool strengthening issues. The Talent
Review Process is a contact sport at GE; it
has the intensity and the importance of the
budget process at most companies.”—Ed
Michaels
“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,
Organizing Genius
PARC’s Bob Taylor:
“Connoisseur
of Talent”
Les Wexner: From
sweaters to people!
Talent (Not) on His Mind
Norman Pearlstine, Editor-in-Chief,
Time Inc. asked a magazine’s
managing editor to name 10
people outside Time that the
magazine should pursue: “He
said, I can’t think of any.’ ”
Source: New York Times/05.12.2003
Visibly energetic/ Passionate/ Enthusiastic … about
everything.
Engaging/ Inspires others. (Inspires the
interviewer!)
Loves messes & pressure.
Impatient/ Action fanatic.
A finisher.
Exhibits: Fat “WOW Project” Portfolio. (Loves to talk about
her work.)
Smart.
Curious/ Eclectic interests/ A little (or more) weird.
Well-developed sense of humor/ Fun to be around.
******
No. 1 re bosses: Exceptional talent selection & development
record. (Former co-workers: “Did you visibly grow while
working with X?” / “How has the department/team grown
on a ‘world-class’ scale during X’s tenure?”)
2. Greatness
Only The Best!
From “1, 2 or you’re out” [JW]
to …
“Best Talent in each
industry segment to build
best proprietary
intangibles” [EM]
Source: Ed Michaels, War for Talent
“Differentiation is all about being
extreme, rewarding the best and
weeding out the ineffective. … You
build strong teams by treating
individuals differently. Just look at
the way baseball teams pay 20game winning pitchers and 40-plus
homerun hitters.”—Jack Welch
3. Performance
Up or out!
“We believe companies can increase their
market cap 50 percent in 3 years. Steve
changed 20 of
his 40 box plant managers to put
more talented, higher paid
managers in charge. He increased
Macadam at Georgia-Pacific
profitability from $25 million to $80 million
in 2 years.”
Ed Michaels, War for Talent
Message: Some
people are
better than other
people. Some people
are a helluva lot
better than other
people.
4. Pay
Fork Over!
“Top performing companies are
two to four times more likely
than the rest to pay
what
it takes to prevent losing
top performers.”
Ed Michaels, War for Talent (05.17.00)
5. Youth
Grovel Before
the Young!
“Why focus on these late teens and twentysomethings? Because they are the first
young who are both in a position to
change the world, and are actually
doing so. … For the first time in history,
children are more comfortable, knowledgeable
and literate than their parents about an
innovation central to society. … The Internet has
triggered the first industrial revolution in history
to be led by the young.”
The Economist [12/2000]
8 Minutes*
—Dr. Sugata Mira, NIIT/ New Delhi/
1999**
*Ignorance to Surfing
**And then there’s oya yubi sedai, the “thumb generation”
6. Diversity
Mess Rules!
“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
“Diversity defines the health
and wealth of nations in a new
century. Mighty is the mongrel. The hybrid is hip.
The impure, the mélange, the adulterated, the
blemished, the rough, the black-and-blue, the mixand-match – these people are inheriting the earth.
Mixing is the new norm. Mixing trumps isolation. It
spawns creativity, nourishes the human spirit, spurs
economic growth and empowers nations.”
G. Pascal Zachary, The Global Me:
New Cosmopolitans and the Competitive Edge
CM Prof Richard Florida on
“Creative Capital”: “You cannot
get a technologically
innovative place unless it’s
open to weirdness,
eccentricity and difference.”
Source: New York Times/06.01.2002
Duh!
“We want our associate population to mirror our
customer population at every level, from the executive
suite all the way to the retail floor. In the marketplace,
basically what I want to do is draw a concentric circle
around every one of our 2,300 stores, and I want the
assortment in that store to match the ethnicity of the
neighborhood it’s in. Some neighborhoods are all
Hispanic, so we can put in a full Hispanic format. That’s
what Super Saver is. All the signage is in both
languages. There’s a 100 percent Spanish-speaking
staff in the store.”—Larry Johnston, CEO, Albertson’s
“Expose yourself to the best
things humans have done and
then try to bring those things
into what you are doing.”
Steve Jobs, on the eclectic nature of the
teams he concocts; people of
“extraordinary tastes” with “intriguing
backgrounds”
7. Women
Born to Lead!
“AS LEADERS, WOMEN
RULE: New Studies find
that female managers
outshine their male
counterparts in almost
every measure”
Title, Special Report, BusinessWeek, 11.20.00
8. Weird
The Cracked Ones
Let in the Light!
The Cracked Ones Let in the Light
“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
enough
weird people in
“Are there
the lab these days?”
V. Chmn., pharmaceutical house, to a lab director (06.01)
“Deviance tells
the story of every mass
market ever created. What
Deviants, Inc.
starts out weird and dangerous
becomes America’s next big corporate
payday. So are you looking for the next
mass market idea? It’s out there … way
out there.”
Source: Ryan Matthews & Watts Wacker, Fast Company (03.02)
“Get me some poets
as managers.”
—Sidney
Harman/Harman International
“When ‘the guys’ leave, the
conversation gets creative.
And it’s not about nails and
kids!”
—(V)Senior Exec, Consumer Goods Behemoth (F)
“The Bottleneck is at the
Top of the Bottle”
“Where are you likely to find people
with the least diversity of experience,
the largest investment in the past, and
the greatest reverence for industry
dogma?
At the top!”
— Gary Hamel, “Strategy or Revolution/
Harvard Business Review
9. Opportunity
Make It an
Adventure!
“H.R.” to “H.E.D.” ???
Human
Enablement
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”
Leaders-Teachers Do Not “Transform People”!
Instead leaders-mentors-teachers (1) provide a
context which is marked by (2) access to a luxuriant
portfolio of meaningful opportunities (projects) which
(3) allow people to fully (and safely, mostly—caveat: “they”
don’t engage unless they’re “mad about something”) express
their innate curiosity and (4) engage in a vigorous
discovery voyage (alone and in small teams, assisted by an
extensive self-constructed network) by which those people
(5) go to-create places they (and their mentors-teachersleaders) had never dreamed existed—and then the
leaders-mentors-teachers (6) applaud like hell, stage
“photo-ops,” and ring the church bells
100 times to commemorate the bravery of their
“followers’ ” explorations!
Talent
Department
People Department
Center for Talent Excellence
Seriously Cool People Who Recruit
& Develop Seriously Cool People
Etc.
10. Leading Genius
We are all unique!
Beware Lurking HR Types …
One size
NEVER fits all.
One size fits
one. Period.
48 Players =
48 Projects =
48 different success
measures.
100% IMAGINATION!*
The Ritz Cookie Lady
PPSI
*Damn it.
MantraM3
Talent = Brand
What’s your company’s …
EVP?
Employee Value Proposition, per Ed
Michaels et al., The War for Talent;
IBP/Internal Brand Promise per TP
EVP = Challenge,
professional growth,
respect, satisfaction,
opportunity, reward
Source: Ed Michaels et al., The War for Talent
Our Mission
To develop and manage talent;
to apply that talent,
throughout the world,
for the benefit of clients;
to do so in partnership;
to do so with profit.
WPP
Talent’s “Big Two” Rules
GREAT Finance Dept. =
GREAT Football Team
DIFFERENCES Among Cello
Players = DIFFERENCES
Among Hotel GMs
“Risk Work”
Job 1: TALENT
ACQUISITION!
The Top 5 “Revelations”
Better talent wins.
Talent management is my job as leader.
Talented leaders are looking for the moon
and stars.
Over-deliver on people’s dreams – they are
volunteers.
Pump talent in at all levels, from all
conceivable sources, all the time.
Source: Ed Michaels et al., The War for Talent
ADDENDA: Tom Peters’
The
Talent50
The Talent50
1. People first!
2. Soft is Hard.
3. FUNDAMENTAL PREMISE: We are in an Age
of Talent/ Creativity/ Intellectual-capital
Added.
4. Talent “excellence” in every part of the
organization.
5. P.O.T./Pursuit Of Talent = Obsession.
6. HR sits at The Head Table.
7. HR is “cool.”
The Talent50
8. Re-name “HR.” (Talent Department, Center of Talent
Excellence)
9. There’s an HR Strategy
10. There is a FORMAL Recruitment Strategy.
11. There is a FORMAL Leadership Development
Strategy.
12. There is a “world class” Leadership Development
Center.
13. There is a FORMAL-STRATEGIC HR Review
Process.
14. The “Top100,” and every unit’s Top10, are
consciously managed.
The Talent50
15. “People/Talent Reviews” are the FIRST reviews.
16. HR Strategy = Business Strategy.
17. Make it a Cause Worth Signing Up For..
18. Set Sky High Standards.
19. Enlist everyone in
Challenge Century21.
20. Pursue the Best!
21. Up or Out.
22. Ensure that the Review Process has INTEGRITY.
23. Pay!
The Talent50
24. Training I: Train! Train! Train!
25. TII: 100% “business people.”
26. TIII: 100% Leaders.
27. TIV: Boss as Trainer-in-Chief.
28. Open Communication I: NO BARRIERS.
29. Open Communication II: Share Information.
(ALL!)
30. Respect!
31. INTEGRITY!
32. Treat the Whole Individual.
The Talent50
33. Places of “grace.”
34. MBWA: The “Rudy Rule.”
35. Thank You!
36. Promote for “people skills.”
(ALL ELSE IS SECONDARY.)
37. Honor youth.
38. Early leadership assignments.
39. Fast Tracking is the norm.
40. Create a System of Mentoring.
The Talent50
41. Diversity!
42. Diversity starts on the Board of
Directors.
43. WOMEN RULE.
44. Weird Wins.
45. We are all unique.
46. Bosses “win people over.”
47. GOAL: Adventures of Mutual
Discovery.
48. Foster Independence.
49. Enthusiasm!
The Talent50
50.
Talent =
Brand.
21. Meet the New Boss:
Women Rule!
“AS LEADERS, WOMEN
RULE: New Studies find
that female managers
outshine their male
counterparts in almost
every measure”
Title, Special Report, BusinessWeek, 11.20.00
Lawrence A. Pfaff & Assoc.
— 2 Years, 941 mgrs (672M, 269F); 360º
feedback
— Women: 20 of 20; 15 of 20 with statistical
significance, incl. decisiveness, planning,
setting stds.)
— “Men are not rated significantly higher by
any of the raters in any of the areas
measured.” (LP)
The New Economy …
Shout goodbye to
“command and control”!
Shout goodbye to hierarchy!
Shout goodbye to “knowing
one’s place”!
“Guys want to put everybody
in their hierarchical place.
Like, should I have more
respect for you, or are you
somebody that’s south
of me?”
Paul Biondi, Mercer Consultants [from It’s Not
Business, It’s Personal, Ronna Lichtenberg]
“Society is based on male
standards with women seen
as anomalies deviating from
the male norm.” — Bi Puvaneu, Institute
for Future Studies (Stockholm)
Women’s Strengths Match New Economy
Imperatives: Link [rather than rank] workers;
favor interactive-collaborative leadership style
[empowerment beats top-down decision making];
sustain fruitful collaborations; comfortable with
sharing information; see redistribution of power
as victory, not surrender; favor multi-dimensional
feedback; value technical & interpersonal skills,
individual & group contributions equally; readily
accept ambiguity; honor intuition as well as pure
“rationality”; inherently flexible; appreciate
cultural diversity.
Source: Judy B. Rosener, America’s Competitive Secret: Women Managers
“On average, women and men
possess a number of different innate
skills. And current trends suggest
that many sectors of the twentyfirst-century economic community
are going to need the natural
talents of women.”
Helen Fisher, The First Sex: The Natural Talents of
Women and How They Are Changing the World
“American women possess leadership
abilities that are particularly effective in
today’s organizations, yet their abilities
remain undervalued and underutilized.
In the future, what will distinguish one
organization and one country from
another will be its use of human
resources. Today human resource
utilization is not only a matter of social
justice but a bottom-line issue.”
Judy Rosener, America’s Competitive Secret
“TAKE THIS QUICK QUIZ: Who manages more things
at once? Who puts more effort into their appearance?
Who usually takes care of the details? Who finds it
easier to meet new people? Who asks more
questions in a conversation? Who is a better
listener? Who has more interest in communication
skills? Who is more inclined to get involved?
Who encourages harmony and agreement? Who
has better intuition? Who works with a longer ‘to do’
list? Who enjoys a recap to the day’s events?
Who is better at keeping in touch with others?”
Source: Selling Is a Woman’s Game: 15 Powerful Reasons Why
Women Can Outsell Men, Nicki Joy & Susan Kane-Benson
“Investors are looking more and more
for a relationship with their financial
advisers. They
want someone
they can trust, someone who
listens. In my experience, in general,
women may be better at these
relationship-building skills than are
men.”
Hardwick Simmons, CEO, Prudential Securities
Work’s Rewards
F: Relationships, respect, self-realization.
M: Title, salary, power. (“In all my research
with men, I’ve never once heard a mention
about the importance of relationships.”)
Source: Susan Rice, former Director of Communications,
BBDO Europe (from “A Dignified Woman”)
“Thank you”
17 Men: 8
4 Women: 19
Ass Of The Year2002 (?): Maurice Greenberg, A.I.G., on
the Company’s New (All Male) Leadership Team
“In a lot of countries of the world, it
would be very difficult for a woman to
be a good CEO. … I have a
responsibility to do the best we can for
shareholders.” * **
*Source: New York Times/05.05.02
**Wouldn’t you love to watch him tell that … face-toface … to Margaret Thatcher or Carly Fiorina? (I would.)
Okay, you think I’ve gone tooooo far.
DO ANY
OF YOU SUFFER
FROM TOO
MUCH TALENT?
How about this:
63 of 2,500 top earners in F500
8% Big 5 partners
14% partners at top 250 law firms
43% new med students; 26% med
faculty; 7% deans
Source: Susan Estrich, Sex and Power
“It’s time for U.S. organizations
to act. No other country in the
world has a comparable supply
of professional women waiting
to be called into action. This is
America’s competitive secret.”
Judy B. Rosener, America’s Competitive Secret
Opportunity!
U.S.
M.Mgt.
41%
T.Mgt.
4%
Peak Partic. Age 45
% Coll. Stud.
52%
G.B. E.U. Ja.
29% 18% 6%
3%
2%
<1%
22
27
19
50% 48% 26%
Source: Judy Rosener, America’s Competitive Secret
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 (May2000)
M-F GPAs: All: 2.92M vs. 3.07F;
Arts: 3.08M, 3.13F; Bus: 2.79M,
2.96F; Science/Math: 2.98M, 3.18F;
Eng/CompSci: 2.96M, 3.17F.
% Professional Degrees: F ’77:
19%; F ’94: 41% (45% Ph.D.s)
“THE NEW GENDER
GAP: From kindergarten
to grad school, boys are
becoming the second
sex”—Cover story,
BusinessWeek/26 May 2003
Girls lead: Student gov’t, music &
performing arts, yearbook &
newspaper, academic clubs.
Boys lead: Sports, learning
disabilities, diagnosed with
emotional disturbances
Source: The New Gender Gap/BusWeek/05.26.03
Degree Gap*
Wom:Men/Bachelor’s … 2000: 133;
2010: 142
Wom:Men/Master’s … 2000: 138;
2010: 151
* Whites, Blacks, Hispanics, Asians, Native Americans
Source: The New Gender Gap/BusWeek/05.26.2003
Workforce participation rate:
Women … soaring; men …
declining.
Voter participation rate: Men …
plummeting; women … declining
Source: The New Gender Gap/BusWeek/05.26.2003
“Are men
obsolete?”
—Headline,
USN&WR/06.03.03
“Boys are trained in
a way that will make
them irrelevant.”
Phil Slater
Read This!
“Winning the Talent War
for Women: Sometimes It
Takes a Revolution”
Douglas McCracken, HBR [11-12/2000]
“Deloitte was doing a great job of hiring highperforming women; in fact, women often earned
higher performance ratings than men in their first
years with the firm. Yet the percentage of women
decreased with step up the career ladder. … Most
women weren’t leaving to raise families; they
had weighed their options in Deloitte’s maledominated culture and found them wanting.
Many, dissatisfied with a culture they perceived as
endemic to professional service firms, switched
professions.”
Douglas McCracken, “Winning the Talent War for Women” [HBR]
“The process of assigning plum
accounts was largely unexamined. …
Male partners made assumptions:
‘I wouldn’t put her on that kind of
company because it’s a tough
manufacturing environment.’ ‘That
client is difficult to deal with.’ ‘Travel
puts too much pressure on women.’ ”
Douglas McCracken, “Winning the Talent War for
Women” [HBR]
!!!!!!!!!!!!!!!
14 to 168*
*Leadership Positions/D&T/1992-2002/WIAR
“Would Congress [the
Boardroom] be a different
place if half the members
were women?”
From Sex and Power, Susan Estrich
“We need to redefine
power? Do we need to
follow the boys’
scorecard” —Ann Fudge, CEO, Young
& Rubicam
“[Women] see power in
terms of influence, not
rank.” —Fortune/10.13.2003
“The dirty little secret is that
women demand a lot more
satisfaction in their lives
than men do.” —Jamie Gorelick
“I’m on the lunatic fringe of
optimism.” —Shelley Lazarus, CEO,
Ogilvy & Mather, on women eventually
occupying 50% of F500 CEO slots (vs. 8/1.6% in
2003)
Norwegian Law: Boards must have
at least
women.
Women Rule
Match market power
Attributes fit N.O.W. (New Org World)
10M biz owners
22. Brand Talent+:
Addressing the
Education
Fiasco
“At the ultimate stage, competition
among nations will be competition
among educational systems, for
the most productive and richest
countries will be those with the
best education and training.”
Richard Rosecrance,
The Rise of the Virtual State
Losing the War
to Bismarck
(and Rockefeller)
J. D. Rockefeller’s General Education Board
(1906):
“In our dreams people
yield themselves with
perfect docility to our
molding hands. … The task is
simple. We will organize children and teach
them in a perfect way the things their fathers
and mothers are doing in an imperfect way.”
John Taylor Gatto, A Different Kind of Teacher
“My wife and I went to a [kindergarten] parent-teacher
conference and were informed that our budding
refrigerator artist, Christopher, would be receiving a
grade of Unsatisfactory in art. We were shocked. How
could any child—let alone our child—receive a poor
His teacher
informed us that he had refused to
color within the lines, which was a
state requirement for
demonstrating ‘grade-level motor
skills.’ ”
grade in art at such a young age?
Jordan Ayan, AHA!
“How many artists are there in the room? Would you please raise
your hands. FIRST GRADE: En masse the children leapt from
their seats, arms waving. Every child was an artist. SECOND
GRADE: About half the kids raised their hands, shoulder high, no
higher. The hands were still. THIRD GRADE: At best, 10 kids out
of 30 would raise a hand, tentatively, self-consciously. By the
time I reached SIXTH GRADE, no more than one or two kids
raised their hands, and then ever so slightly, betraying a fear of
being identified by the group as a ‘closet artist.’ The point is:
Every school I visited was participating
in the suppression of creative genius.”
Gordon MacKenzie, Orbiting the Giant Hairball: A Corporate Fool’s Guide to Surviving with Grace
An Unnatural
Way to
“Learn”
Schools’ “Kafka-like rituals”: “enforce sensory
deprivation on classes of children held in
featureless rooms … sort children into rigid
categories by the use of fantastic measures such as
age-grading, or standardized test scores … train
children to drop whatever they are occupied with
and to move as a body from room to room at the
sound of a bell, buzzer, horn, or klaxon … keep
children under constant surveillance, depriving
them of private time and space …
John Taylor Gatto, A Different Kind of Teacher
Kafka-like rituals (cont.): “assign children
numbers constantly, feigning the ability to
discriminate qualities quantitatively … insist
that every moment of time be filled with lowlevel abstractions … forbid children their own
discoveries, pretending to possess some vital
secret to which children must surrender their
active learning time to acquire.”
John Taylor Gatto, A Different Kind of Teacher
Doing Stuff
that Matters!
“What actually correlates with success are not
grades but ‘engagement’—genuine involvement
in courses and campus activities. Engagement
leads to ‘deep learning.’ That’s very different
from just memorizing stuff for an exam. As Russ
Edgerton of the Pew Forum on Undergraduate
Learning notes, ‘What counts is what students
do in college, not who they are or where they
go to college, or what their grades are.’” —John
Merrow/USA Today/02.2003
“During the first years of
life, youngsters all over
the world master a
breathtaking array of
competences with little
formal tutelage.”
Howard Gardner, The Unschooled Mind
“Children should be taught in
an active way by doing things
and playing games. It’s very
different to what is taught in
schools which involves sitting
back and absorbing
information.” —Edward de Bono/The
Independent/10.28.2002
The Learner’s Manifesto
The brain is always learning.
Learning does not require coercion.
Learning must be meaningful.
Learning is incidental.
Learning is collaborative.
The consequences of worthwhile learning
are obvious.
Learning always involves feelings.
Learning must be free of risk.
Frank Smith, Insult to Intelligence
“Really bright
kids who just
needed to get
excited” —teacher, Oakley
School
Tom’s Edu3M
Manifesto*
*Manifesto for Education in the 3rd Millennium
Education3M
Learning is a normal state.
Children are learnavores.
Prodigious feats of learning are common as dirt.
[Watch an H.S. QB studying game film.]
We learn at different rates.
We learn in different ways.
Boys and girls learn [very] differently.
In a class of 25, there are 25 different trajectories.
Learning in 40-minutes blocks is bullshit.
Learning for tests is utterly insane.
There are numerous rigorous evaluation schemes,
of which testing is but one—and abnormal, by “real
world” standards.
Education3M
We learn most/fastest/most completely when we
are passionate about what we are learning and it
matters to us. [Salience rules!]
Think EBI/LBI: Education by Interest/
Learning by Internship.
Classrooms are abnormal places.
We need changes of pace. [Japanese recesses after each
class.]
International test scores are not correlated with
hours-per-year in class.
Big classes are slightly problematic. Big schools
suck. Period.
Education3M
We learn most/fastest/most completely when we
are passionate about what we are learning and it
matters to us. [Salience rules!]
Think EBI/LBI: Education by Interest/
Learning by Internship.
Classrooms are abnormal places.
We need changes of pace. [Japanese recesses after each
class.]
International test scores are not correlated with
hours-per-year in class.
Big classes are slightly problematic. Big schools
suck. Period.
Education3M
“All this”—the right stuff—fits the NWW/New World
of Work hand-in-glove. [NWW = Age of Creativity.]
U.S. schools circa 2001 are a vestige of the
Prussian-Fordist model, more interested in shaping
behavior than stoking the fires of lifelong learning.
Cutting art-music budgets is truly dumb.
Learning is a matter of Intensity of Engagement, not
elapsed time. [Aargh: 11 minutes on the Battle of Gettysburg.]
Teachers need enough space-time-flexibility to get
to know kids as individuals.
Scientific discovery processes and the teaching of
science are utterly at odds. [Exploration vs. spoon-feeding.]
Education3M
Our toughest “learning achievement”—
mastering our native language—does not
require schools, or even competent parents. [It
does require a desperate need-to-know.]
Great teachers are great learners, not impartersof-knowledge.
Great teachers ask great questions—that launch
kids on lifelong quests.
The world is not about “right” & “wrong”
answers; it is about the pursuit of increasingly
sophisticated questions—just ask a ski
instructor or neurosurgeon.
Education3M
Most schools spend most of their time setting
up contexts in which kids learn not to like
particular subjects. [Evidence shows that such antilearning sticks!]
Vigorous exploration is normal … until you are
incarcerated in a school.
“Bite size” education-learning is neither
education nor learning.
Learning takes place rapidly on the cheerleading
squad, the football team, the school newspaper,
the drama club, at the after-class job--just not in
the hyper-structured classroom.
Education3M
The “school reform” “movement” is a giant step …
backwards … embracing the Prussian-Fordist
paradigm with renewed vigor—at exactly the
wrong time.
There are large numbers of superb schools, superb
principals, superb teachers; sadly, they not only fail
to infect the [largely timid] rest, but are ordinarily
supplanted by wusses & wimps.
Alas, the teaching profession does not ordinarily
attract “cool dudes & dudettes.”
Schools of “education” should by and large have
their charters revoked.
Education3M
Stability is dead; “education” must
therefore “educate” for an unknowable,
ambiguous, changing future; thence,
learning to learn & change is far more
important than mastery of a static
body of “facts.”
“Education” must “develop in youth the
capabilities for engaging in intense concentrated
involvement in an activity.” [James Coleman, 1974.]
[Hint: It doesn’t.] [Hint: Understatement.]
“The boys who made the
best ‘Grotties’ usually
turned out to be nonentities
later; boys who hated
Groton did much better.”
FDR biographer John Gunther (quoted in Whoever Makes the
Most Mistakes Wins, Richard Farson & Ralph Keyes)
Ye gads: “Thomas Stanley has not only found no
correlation between success in school and an
ability to accumulate wealth, he’s actually found
a negative correlation. ‘It seems that schoolrelated evaluations are poor predictors of
economic success,’ Stanley concluded. What did
predict success was a willingness to take risks.
Yet the success-failure standards of most
schools penalized risk takers. Most educational
systems reward those who play it safe. As a
result, those who do well in school find it hard to
take risks later on.”
Richard Farson & Ralph Keyes, Whoever Makes the Most Mistakes Wins
The NAESP …
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
–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!
Roy Sunada/John Marshall
Fundamental Secondary School
Pass APs: 37 to 87 (’97-’02)
Enrolled APs: 33%
Attend college: 57% to 88%
College Board 2003 Inspiration
Award: 1 of 3
VIII. NEW
BUSINESS: (NEW)
BRAND INSIDE
RULES
2003 …
Message
BI > BO
Brand Inside Rules!
“I came to see in my time
at IBM that culture isn’t
just one aspect of the
game—it is the game” —Lou
Gerstner, Who Says Elephants Can’t Dance?
Brand Inside Rules!
“If I could have chosen not to tackle
the IBM culture head-on, I probably
wouldn’t have. My bias coming in was
toward strategy, analysis and
measurement. In comparison,
changing the attitude and behaviors of
hundreds of thousands of people is
very, very hard.” —Lou Gerstner, Who Says
Elephants Can’t Dance?
23. THINK
WEIRD … the HVA/
High Value Added
Bedrock.
The
High Standard
Deviation
Enterprise.
THINK WEIRD:
Saviors-in-Waiting
Disgruntled Customers
Off-the-Scope Competitors
Rogue Employees
Fringe Suppliers
Wayne Burkan, Wide Angle Vision: Beat the Competition by Focusing on
Fringe Competitors, Lost Customers, and Rogue Employees
CUSTOMERS: “Futuredefining customers may
account for only 2% to 3%
of your total, but they
represent a crucial
window on the future.”
Adrian Slywotzky, Mercer Consultants
“If you worship at the
throne of the voice of the
customer, you’ll get only
incremental advances.”
Joseph Morone, President,
Bentley College
“These days, you can’t succeed as a
company if you’re consumer led –
because in a world so full of so much
constant change, consumers can’t
anticipate the next big thing.
Companies should be idealed and consumerinformed.”
Doug Atkin, partner, Merkley Newman Harty
“The future has
already happened. It’s
just not evenly
distributed.”
Adrian Slywotzky
“Generally, disruptive technologies
underperform established
established products in
mainstream markets. But they have
other features that a few fringe
(and generally new) customers
value.”
Clayton Christensen, The Innovator’s Dilemma
W.I.W?
20 of 26
7 of top 10*
*P&G: Declining domestic sales
in 20 of 26 categories; 7 of top 10
(The “billiondollar” problem.)
categories.
Source: Advertising Age 01.21.2002/BofA Securities
Primary Obstacles to “Marketing-driven Change”
1. Fear of “cannibalism.”
2. “Excessive cult of the
consumer”/ “customer driven”/
“slavery to demographics, market
research and focus groups.”
3.Creating “sustainable
advantage.”
Source: John-Marie Dru, Disruption
Account planning
has become “focus
group balloting.”
—Lee
Clow
“Chivalry is dead. The new code of conduct is
an active strategy of disrupting the status quo
to create an unsustainable series of competitive
advantages. This is not an age of defensive
castles, moats and armor. It is rather an age of
cunning, speed and surprise. It may be hard for
some to hang up the chain mail of ‘sustainable
advantage’ after so many battles. But
hypercompetition, a state in which sustainable
advantages are no longer possible, is now the
only level of competition.”
Rich D’Aveni, Hypercompetition: Managing the Dynamics of
Strategic Maneuvering
Ways to Raise a Purple Cow
Think small. One vestige of the TVindustrial complex is a need to think
mass. If it doesn’t appeal to everyone,
the thinking goes, it’s not worth it.
Think of the smallest conceivable
market—and describe a product that
overwhelms it with remarkability. Go
from there.
Source: Seth Godin, Fast Company (02.2003)
“HAVE MBAs KILLED OFF MARKETING?
Prof
Rajeev Batra says: ‘What these times call for is more creative
and breakthrough reengineering of product and service benefits,
but we don’t train people to think like that.’ The way marketing is
taught across business schools is far too analytical and datadriven. ‘We’ve taken away the emphasis on creativity and big
ideas that characterize real marketing breakthroughs.’ In India
there is an added problem: most senior marketing jobs have
been traditionally dominated by MBAs. Santosh Desai, vice
president, McCann Erickson, an MBA himself, believes in India
engineer-MBAs, armed with this Lego-like approach, tend to
reduce marketing into neat components. ‘This reductionist
thinking runs counter to the idea that great brands must have a
core, unifying idea.’ ”—Businessworld/04Nov2002/“Why Is
Marketing Not Working?”
Great “Merchants” * I have known:
Sam (Walton)
Les (Wexner)
Mickey (Drexler)
*The fingertips of a safecracker.
The Fatal Assumption: “Analysis
Produces Synthesis”
“Planning by its very nature defines and
preserves categories. Creativity, by its very
nature, creates categories or rearranges
established ones ... The key is integration
rather than de-composition, based on
holistic images rather than linear words.”
— Henry Mintzberg,
The Rise and Fall of Strategic Planning
“BIG DRUG MAKERS TRY TO POSTPONE
CUSTOM REGIMENS. Most drugs don’t work
well for about half the patients for whom they are
prescribed, and experts believe genetic
differences are part of the reason. The
technology for genetic testing is now in use. But
the technique threatens to be so disruptive to the
business of big drug companies – it could limit
the market for some of their blockbuster
products – that many of them are resisting its
widespread use.”
The Wall Street Journal (06.18.2001)
COMPETITORS: “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
“To grow, companies need
to break out of a vicious
cycle of competitive
benchmarking, imitation and
pursuit.” —W. Chan Kim & Renee Mauborgne,
“”Think for Yourself —Stop Copying a Rival,” Financial
Times/08.11.03
“Aiming to beat the competition has
the opposite effect to the one
intended. It keeps companies focused
on the competition. When asked to
build competitive advantage,
managers typically rate themselves
against competitors, assess what they
do and try to do it better.” —W. Chan Kim &
Renee Mauborgne, “Think for Yourself—Stop copying a
Rival”/FT/08.03
“The short road to ruin is to
emulate the methods of your
adversary.”
— Winston Churchill
Employees: “Are there
enough weird
people in the lab these
days?”
V. Chmn., pharmaceutical house, to a lab director (06.01)
Suppliers: “There
is an ominous
downside to strategic supplier
relationships. An SSR supplier is not
likely to function as any more than a mirror
to your organization. Fringe suppliers that
offer innovative business practices need
not apply.”
Wayne Burkan, Wide Angle Vision: Beat the Competition by Focusing on
Fringe Competitors, Lost Customers, and Rogue Employees
Boards: “Extremely contentious
boards that regard dissent as an
obligation and that treat no
subject as undiscussable” —Jeffrey
Sonnenfeld, Yale School of Management
“The Bottleneck is at the
Top of the Bottle”
“Where are you likely to find people
with the least diversity of experience,
the largest investment in the past, and
the greatest reverence for industry
dogma?
At the top!”
— Gary Hamel, “Strategy or Revolution/
Harvard Business Review
“Enormous sums of money are invested to
reduce cycle time, improve quality,
reengineer … Much of this money is simply
wasted. The waste is due to companies’
inability to develop wide-angle vision and
tap into the … power of the edge.”
Wayne Burkan, Wide Angle Vision: Beat the
Competition by Focusing on Fringe Competitors,
Lost Customers, and Rogue Employees
“Corporate consciousness is
predictably centered around the
mainstream. The best customers,
biggest competitors, and model
employees are almost invariably the
focus of attention.”
Wayne Burkan, Wide Angle Vision: Beat the
Competition by Focusing on Fringe Competitors,
Lost Customers, and Rogue Employees
We become
who we hang
out with!
Message: TAKE
SOMEONE NEW &
WEIRD TO LUNCH
TODAY OR TOMORROW.
[Inundate yourself with weird.]
WEIRD IDEAS THAT WORK: (1) Hire slow learners (of the
organizational code). (1.5) Hire people who make you
uncomfortable, even those you dislike. (2) Hire people you
(probably) don’t need. (3) Use job interviews to get ideas, not
to screen candidates. (4) Encourage people to ignore and defy
superiors and peers. (5) Find some happy people and get them
to fight. (6) Reward success and failure, punish inaction.
(7) Decide to do something that will probably fail, then convince
yourself and everyone else that success is certain. (8) Think of
some ridiculous, impractical things to do, then do them.
(9) Avoid, distract, and bore customers, critics, and anyone who
just wants to talk about money. (10) Don’t try to learn anything
from people who seem to have solved the problems you face.
(11) Forget the past, particularly your company’s success.
Bob Sutton, Weird Ideas That Work: 11½ Ideas for Promoting,
Managing, and Sustaining Innovation
Kevin Roberts’ Credo
1. Ready. Fire! Aim.
2. If it ain’t broke ... Break it!
3. Hire crazies.
4. Ask dumb questions.
5. Pursue failure.
6. Lead, follow ... or get out of the way!
7. Spread confusion.
8. Ditch your office.
9. Read odd stuff.
10. Avoid moderation!
Advice to Corporate Leaders: “Consider the
metaphor of the windmill: You can harness raw
power but you can’t control it. … Hire artists,
clowns, or other disrupters to come in and
challenge your corporate environment. … Hire a
corporate anthropologist to analyze how tolerant
your organization is of deviants and other
innovators. … Once the anthropologist
leaves, hire a shaman to drive out the
evil spirits of conformity. …”
Source: Ryan Matthews & Watts Wacker, Fast Company (03.02)
“Deviance tells
the story of every mass
market ever created. What
Deviants, Inc.
starts out weird and dangerous
becomes America’s next big corporate
payday. So are you looking for the next
mass market idea? It’s out there … way
out there.”
Source: Ryan Matthews & Watts Wacker, Fast Company (03.02)
“ ‘Giant’ projects contain within them the
almost certain seeds of mediocrity. The
very fact of their size causes constant
scrutiny and thence ‘political’ interference.
Such ‘oversight’ drains the passion of the
champions and risks—to the point of
certainty—fatal ‘dumbing down’ and
thence loss of the very distinction and
quirkiness sought in the first place.”—
Exec, Hollywood
Innovation Source No. 1*:
PPPs/Personally Pissed-off
People
“Branson started Virgin Atlantic
because flying other airlines was
so dreadful.” —Fortune/05.13.2002
*And there is no No. 2!
Renewal = The Weird 10 =
The “High S.D.” Enterprise/Individual
Pioneer [Weird] Acquisitions
Pioneer Customers & Alliance Partners [Measure the Portfolio’s S.D.]
Divide & Conquer/“Sell-by” [Lessons from the Bees, Sir Richard, Gary H.]
Pioneer Assignments/Pioneer Projects [F2F & K2K]
Hire Weird [Diversity]/Train Weird/Promote Weird/Pay Gobs &
Promote Fast & Cherish “Six Sigma” Talent/Appoint a Weird Board
Weed Un-weird [“One Sigma” “Talent,” etc.]
Hang out with Weird [Univ. of Weird]/Lunch with Weird/
Read & Surf Weird/Vacate Weird
R.A.F. to R.F.A. to F.F.F. [O.O.D.A. Loops/Prototyping Mania]
Sense of Humor [Rhapsodize Over Thine Failures]
Re-enforce a “Culture of Disrespect”/Piracy
Big Idea/s
V.C.
GM
Portfolio
Roster
Innovation Index: How
many of your Top 5
Strategic Initiatives score
7 or higher (out of 10) on
a “Weirdness/Profundity
Scale”?
“This is an essay about what it takes to create and sell
something remarkable. It is a plea for originality, passion, guts
and daring. You can’t be remarkable by following someone else
who’s remarkable. One way to figure out a theory is to look at
what’s working in the real world and determine what the
successes have in common. But what could the Four Seasons
and Motel 6 possibly have in common? Or Neiman-Marcus and
Wal*Mart? Or Nokia (bringing out new hardware every 30 days
or so) and Nintendo (marketing the same Gameboy 14 years in
a row)? It’s like trying to drive looking in the rearview mirror.
The thing that all these companies have in common is that they
have nothing in common. They are outliers. They’re on the
fringes. Superfast or superslow. Very exclusive or very cheap.
Extremely big or extremely small. The reason its so hard to
follow the leader is this: The leader is the leader precisely
because he did something remarkable. And that remarkable
thing is now taken—so it’s no longer remarkable when you
decide to do it.” —Seth Godin, Fast Company/02.2003
IX. NEW BUSINESS.
NEW LEADERSHIP.
24. The Passion
Imperative:
Leadership
The
The Basic
Premise.
1. Leadership Is a …
Mutual
Discovery
Process.
Leaders-Teachers Do Not “Transform People”!
Instead leaders-mentors-teachers (1) provide a
context which is marked by (2) access to a luxuriant
portfolio of meaningful opportunities (projects) which
(3) allow people to fully (and safely, mostly—caveat: “they”
don’t engage unless they’re “mad about something”) express
their innate curiosity and (4) engage in a vigorous
discovery voyage (alone and in small teams, assisted by an
extensive self-constructed network) by which those people
(5) go to-create places they (and their mentors-teachersleaders) had never dreamed existed—and then the
leaders-mentors-teachers (6) applaud like hell, stage
“photo-ops,” and ring the church bells
100 times to commemorate the bravery of their
“followers’ ” explorations!
Quests!
Organizing Genius / Warren Bennis and Patricia
Ward Biederman
“Groups become great only when
everyone in them, leaders and
members alike, is free to do his or her
absolute best.”
“The best thing a leader can do for a
Great Group is to allow its members to
discover their greatness.”
“I don’t
know.”
“Ninety percent of what
we call ‘management’
consists of making it
difficult for people to get
things done.” – P.D.
“Firms will not ...
“ ‘manage’ employees’ careers ...
“[They] will provide opportunities and
resources ... to enable the employee to
develop identity and adaptability and thus
be in charge of his or her own career.”
Source: Douglas T. Hall and Jonathan Moss,
“The New Protean Career Contract” (Organizational Dynamics)
The
Leadership
Types.
2. Great Leaders on Snorting
Steeds Are Important – but
Great Talent
Developers (Type I
Leadership) are the Bedrock
of Organizations that Perform Over
the Long Haul.
25/8/53*
(*Damn it!)
Whoops: Jack
didn’t have a vision!
T.A.:
3. But Then Again, There
Are Times When This
“Cult of Personality”
(Type II Leadership) Stuff
Actually Works!
“A leader is a
dealer in
hope.”
Napoleon
(+TP’s writing room pics)
USN&WR/What traits do successful
activists share?
“They
have hope, and
they imbue others
with hope.”
Studs Terkel, age 91:
“Policy you
calculate.
Leadership comes
by instinct.”
—Tony Blair (09.30.2003)
4. Find the
“Businesspeople”!
(Type III Leadership)
I.P.M.
(Inspired Profit
Mechanic)
5. All Organizations
Need the Golden
Leadership
Triangle.
The Golden Leadership
Triangle: (1) CreatorVisionary … (2) Talent
Fanatic-Mentor-V.C. … (3)
Inspired Profit Mechanic.
The Essential Tension
— Keeper of the Flame of Creation
(Brahma = Creator)
— Keeper of the Flame of Preservation
(Vishnu = Preserver)
— Keeper of the Flame of Destruction
(Shiva = Destroyer)
6. Leadership Mantra
#1: IT
ALL
DEPENDS!
Renaissance Men
are … a snare, a
myth, a delusion!
7. The Leader Is
Rarely/Never the
Best Performer.
33 Division Titles. 26
League Pennants. 14
World Series: Earl Weaver—0.
Tom Kelly—0. Jim Leyland—0.
Walter Alston—1AB. Tony
LaRussa—132 games, 6 seasons.
Tommy Lasorda—P, 26 games.
Sparky Anderson—1 season.
The
Leadership
Dance.
8. Leaders …
SHOW UP!
“The first and greatest
imperative of command
is to be present in
person. Those who
impose risk must be
seen to share it.” —John
Keegan, The Mask of Command
“A body can pretend
to care, but they
can’t pretend to be
there.”
— Texas Bix Bender
P.S. …
5,000
miles for a 5
min. meeting!
Mark McCormack:
9. Leaders …
LOVE the
MESS!
“I’m not comfortable
unless
I’m uncomfortable.”
—Jay
Chiat
“If things seem
under control,
you’re just not
going
fast enough.”
Mario Andretti
10. Leaders
The Kotler Doctrine:
1965-1980: R.A.F.
(Ready.Aim.Fire.)
1980-1995: R.F.A.
(Ready.Fire!Aim.)
1995-????: F.F.F.
(Fire!Fire!Fire!)
“We have a
‘strategic’ plan.
It’s called doing
things.”
— Herb Kelleher
“You miss 100 percent
of the shots you don’t
take.”
— Wayne Gretsky
11. Leaders
Re
-do.
“If Microsoft is good at anything, it’s
avoiding the trap of worrying about
criticism. Microsoft fails constantly.
They’re eviscerated in public for lousy
products. Yet they persist, through
version after version, until they get
something good enough. Then they
leverage the power they’ve gained in
other markets to enforce their standard.”
Seth Godin, Zooming
“The lesson is the importance of
relentless readjustment. At
Microsoft they never get it right,
but they’re constantly, relentlessly
adjusting. And somehow, through
constant readjustment practice
over time, they gradually weave
their way to the right place.” —George
Colony, Forrester Research
“Sony Electronics has a wellearned reputation for persistence.
The company’s first entry into a
new field often isn’t very good. But,
as it has shown in laptops, Sony
will keep trying until it gets
it right.”
BusinessWeek (5/01)
“If it works,
it’s obsolete.”
—Marshall McLuhan
12. BUT … Leaders
Know When to
Wait.
Tex Schramm:
The
“too hard”
box!
13. Leaders Are …
Optimists.
Hackneyed but none the less
LEADERS SEE
CUPS AS “HALF
FULL.”
true:
“[Ronald
Reagan] radiated an
almost transcendent
happiness.”
Half-full Cups:
Lou Cannon, George (08.2000)
14. Leaders …
DELIVER!
“Leaders don’t
‘want to’ win.
Leaders ‘need
to’ win.”
#49
“If it ever becomes ‘just
another game,’ I’ll quit
the next day. Every game
th
is the 7 game of the
playoffs. ‘Ordinary,’
‘regular season’ game—
forget that.” — NBA coach
“It is no use saying ‘We
are doing our best.’You
have got to succeed in
doing what is
necessary.” —WSC
“When assessing candidates, the first
thing I looked for was energy and
enthusiasm for execution. Does she
talk about the thrill of getting things
done, the obstacles overcome, the role
her people played—or does she keep
wandering back to strategy or
philosophy?” —Larry Bossidy,
Honeywell/AlliedSignal, in Execution
15. BUT …
Leaders Are
Realists/Leaders
Win Through
LOGISTICS!
The “Gus
Imperative”!
16. Leaders
FOCUS!
“To
Don’t ”
List
It’s T-H-R-E-E, Stupid!
“I used to have a rule for myself that at any
point in time I wanted to have in mind — as
it so happens, also in writing, on a little card
I carried around with me — the three big
things I was trying to get done. Three. Not
two. Not four. Not five. Not ten. Three.”
— Richard Haass, The Power to Persuade
17. Leaders …
Set CLEAR
DESIGN SPECS.
Danger:
S.I.O.
(Strategic
Initiative Overload)
[email protected]: (1) Neutron
JackWorld/
Jack. (Banish bureaucracy.) (2) “1, 2
or out” Jack. (Lead or leave.) (3)
“Workout” Jack. (Empowerment,
GE style.) (4) 6-Sigma Jack. (5)
Internet Jack. (Throughout)
TALENT JACK!
18. Leaders …
Send V-E-R-Y
Clear Signals About
Design Specs!
Ridin’ with Roger: “What
have
you done to
DRAMATICALLY
IMPROVE quality in the
last 90 days?”
If It Ain’t Broke
… Break It.
19. Leaders …
FORGET!/
Leaders …
DESTROY!
Forget>“Learn”
“The problem is never how
to get new, innovative
thoughts into your mind,
but how to get the old
ones out.”
Dee Hock
Forbes100 from 1917 to 1987: 39
members of the Class of ’17 were alive
in ’87; 18 in ’87 F100; 18 F100
“survivors” underperformed the market
by 20%; just 2 (2%), GE & Kodak,
outperformed the market 1917 to 1987.
S&P 500 from 1957 to 1997: 74 members of the Class of ’57 were
alive in ’97; 12 (2.4%) of 500 outperformed the market from 1957
to 1997.
Source: Dick Foster & Sarah Kaplan, Creative Destruction: Why
Companies That Are Built to Last Underperform the Market
Cortez!
Leaders “dump
the
ones who brung
’em” —Nokia, HP, 3M,
PerkinElmer, Corning, etc.
20. BUT … Leaders
Have to Deliver, So They
Worry About “Throwing
the Baby Out with the
Bathwater.”
“Damned If You
Do, Damned If You
Don’t, Just Plain
Damned.”
Subtitle in the chapter, “Own Up to the Great Paradox: Success
Is the Product of Deep Grooves/ Deep Grooves Destroy
Adaptivity,” Liberation Management (1992)
21. Leaders …
HONOR THE
USURPERS.
Saviors-in-Waiting
Disgruntled Customers
Upstart Competitors
Rogue Employees
Fringe Suppliers
Wayne Burkan, Wide Angle Vision
WE
BECOME WHO
WE HANG
WITH!
Leaders know …
22. Leaders Make
[Lotsa] Mistakes
– and MAKE NO
BONES ABOUT IT!
DG to TP: “Sam
is not afraid
to fail.” *
*NASA failing #1, from the shuttle disaster report (July 2003):
“fear of retribution by lower-level employees.”
“Fail faster.
Succeed
sooner.”
David Kelley/IDEO
Fail.
Forward.
Fast.
–High-tech Exec
“No matter. Try
again. Fail
again. Fail
better.” —Samuel Beckett
“Success is the ability
to go from failure to
failure without losing
your enthusiasm.”
Winston Churchill
(as quoted by John Peterman)
“The Silicon Valley of
today is built less atop
the spires of earlier
triumphs than upon the
rubble of earlier
debacles.”—Newsweek/ Paul Saffo (03.02)
23. Leaders Make …
BIG MISTAKES!
“Reward
excellent
failures. Punish
mediocre successes.”
Phil Daniels, Sydney exec (and, de facto, Jack)
Silicon Valley Success
[Failure?] 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
Create.
24. Leaders Know that
THERE’S MORE TO LIFE
THAN “LINE EXTENSIONS.”
Leaders Love to CREATE NEW
MARKETS.
“Acquisitions are about
buying market share. Our
challenge is to
create markets.
There is a big difference.”
Peter Job, CEO, Reuters
No one ever made it
into the Business Hall
of Fame on a record of
“line extensions.”
25. Leaders … Make
Their Mark /
Leaders … Do Stuff
That Matters
“I never, ever thought of myself
I was
interested in creating
things I would be
proud of.” —Richard Branson
as a businessman.
“In 1933, Thomas J.
Watson Sr. gave a speech
at the World’s Fair, ‘World
Peace through World
Trade.’ We stood for
something, right?” —Sam
Palmisiano
1st Law Mktg Physics: OVERT BENEFIT (Focus: 1 or 2 > 3 or
4/“One Great Thing.”
Source #1: Personal Passion)
2ND Law: REAL REASON TO BELIEVE (Stand & Deliver!)
3RD Law: DRAMATIC
DIFFERENCE (Execs Don’t Get It:
“intent to purchase” – 100%; “unique” – 0% to
5%)
Source: Jump Start Your Business Brain, Doug Hall
Legacy!
CEO Assignment2002 (Bermuda):
“Please leap forward to 2007, 2012, or
2022, and write a business history of
What will have
been said about your
company during your
tenure?”
Bermuda.
Ah, kids: “What is your vision for
the future?” “What have you
accomplished since your first
book?” “Close your eyes and
imagine me immediately doing
something about what you’ve
just said. What would it be?”
“Do you feel you have an
obligation to ‘Make the world a
better place’?”
No Small Thing!
“Hey, I know I’ll
have something to
tell my Grandkids
about.” —dot.com refugee
Herman Edwards: “I picked up one of
those Jets books and I told them, ‘What
you do as a football team is your legacy.
When you’re 80 years old, what you’ve
done will be in this book and no one can
take that away from you. Your grandkids,
your kids after that, they will know what
you did. It’s about leaving your name in
stone.”
Source: The New York Times (12.31.02)
“Management has a lot to do
with answers. Leadership is a
function of questions. And the
first question for a leader
always is: ‘Who do we intend
to be?’ Not ‘What are we going
to do?’ but ‘Who do we intend to
be?’” —Max DePree, Herman Miller
26. Leaders Push Their
W-a-y Up the
Value-added/
Intellectual Capital
Chain
Organizations
09.11.2000: HP bids
$18,000,000,000
for
PricewaterhouseCoopers
Consulting business!
27. Leaders
LOVE the
New Technology!
square feet
28. Needed? Type IV
Leadership:
Technology
Dreamer-True
Believer
The Golden Leadership
Quadrangle: (1) CreatorVisionary … (2) Talent
Fanatic-Mentor-V.C. … (3)
Inspired Profit Mechanic. (4)
Technology Dreamer-True
Believer
Talent.
29. When It Comes to
TALENT …
Leaders Always Swing
for the Fences!
Talent’s Rules
1. Talent = 25/8/53
2. Some people are better than
other people. Some people are a
helluva lot better than other
people
3. Think “Roster”
4. Think “V.C.”
5. Talent = Brand
6. Talent is what leaders do.
30. Leaders Don’t
Create “Followers”:
THEY CREATE
LEADERS!
“I start with the
premise that the
function of leadership
is to produce more
leaders, not more
followers.”—Ralph Nader
Brand You, Big Time!
I AM AN
ARMY OF
ONE
31. Leaders “Win
Followers Over”
WHAT AN IDIOT: “Instead
of employees being in the driver’s
seat, now we’re in the driver’s
seat.”
“Coaching
is winning
players over.”
PJ:
“I didn’t have a ‘mission statement’ at
Burger King. I had a dream. Very
simple. It was something like, ‘Burger
King is 250,000 people, every one of
whom gives a shit.’ Every one.
Accounting. Systems. Not just the
drive through. Everyone is ‘in the
brand.’ That’s what we’re talking
about, nothing less.”
— Barry Gibbons
Passion.
32. Leaders …
Out Their
PASSION!
“Create a
‘cause,’ not a
‘business.’ ”
G.H.:
“Vision is a love
affair with an
idea.”
—Boyd Clarke & Ron
Crossland, The Leader’s Voice
“Coca-Cola was Roberto Goizueta’s
painting. It was never finished, and he
was never totally satisfied with it. But
he had the Sistine Chapel in his head,
and he was always working on it.”
— Warren Buffett
33. Leaders Know:
ENTHUSIASM
BEGETS
ENTHUSIASM!
BZ: “I am a …
Dispenser of
Enthusiasm!”
“Until there is commitment there is hesitancy,
the chance to draw back. Concerning all acts of
initiative and creation, there is one elementary
truth, the ignorance of which kills countless
ideas and splendid plans: that the moment one
definitely commits oneself, then providence
moves too. All sorts of things occur to help one
that would never otherwise have occurred.
Whatever you can do or dream you can, begin it.
Boldness has genius, power and magic in it.
Begin it now!” —Johann Wolfgang von Goethe
“I overcame every single one of my
personal shortcomings by the sheer
passion I brought to my work.”
“Don’t become too predictable.”
“Swim upstream. Go the other way.
Ignore conventional wisdom.”
Source: Sam Walton
Hint: All this gets much harder as you become bigger.
“You can’t behave in a calm,
rational manner. You’ve got to
be out there on the lunatic
fringe.” — Jack Welch,
on GE’s quality program
“I’m looking for
insane
commitment. I’m
no less strict with
myself.”
—Twyla Tharp, The Creative Habit
“… a powerful and
madly exuberant
work” —LA Times on Frank Gehry’s
Walt Disney Concert Hall (10.03)
34. Leaders Are …
in a Hurry
The Urgency
Factor: LEADERS
… have a distorted
sense of time. (E.g.:
Rummy thinks he asked months ago … it was
the day before yesterday.)
35. Leaders
Focus on the
SOFT STUFF!
“Soft” Is
“Hard”
- ISOE
Message: Leadership is
all about love! [Passion,
Enthusiasms, Appetite for Life,
Engagement, Commitment, Great
Causes & Determination to Make a
Damn Difference, Shared Adventures,
Bizarre Failures, Growth, Insatiable
Appetite for Change.] [Otherwise, why bother?
Just read Dilbert. TP’s final words: CYNICISM SUCKS.]
“Ph.D. in leadership. Short course: Make a
short list of all things done to you that you
abhorred. Don’t do them to others. Ever.
Make another list of things done to you that
you loved. Do them to others. Always.”
— Dee Hock
The “Job” of
Leading.
36.
Leaders Know It’s
ALL SALES ALL
THE TIME.
“Everybody lives by
selling something.”
— Robert Louis Stevenson
If you don’t LOVE
SALES … find
another life. (Don’t pretend
TP:
you’re a “leader.”) (See TP’s
The Project50.)
37. Leaders
LOVE
“POLITICS.”
If you don’t LOVE
POLITICS … find
another life. (Don’t pretend
TP:
you’re a “leader.”)
38.
But … Leaders Also
Break a Lot of
China
If you’re not
pissing people off,
you’re not making
a difference!
39. Leaders
Give …
RESPECT!
“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
Mr. Sam’s Rules
Commit.
Share.
Motivate.
Communicate.
Appreciate.
Celebrate.
Listen.
Exceed expectations.
Control expenses.
Swim upstream.
Trust
“ ‘Empowerment has become the biggest gap
between walk and talk in America. I hear
CEOs stand at podiums and say, ‘How do we
get rid of five thousand more?’ We should
forget the word empowerment and go back to
plain English. Empowerment is nothing more
than a fancy word for trust.”
— Barry Gibbons
Amen!
“What creates trust, in the
end, is the leader’s
manifest respect for the
followers.” — Jim O’Toole, Leading Change
Trust: Delegated Ability to Fail
“ ‘Trust’ is the delegated ability to fail ... the
ability for me or the security guy or the janitor
to go out there and make a difference and add
value to the level that they can fail. It’s not
natural to ‘captains of industry,’ and until we
fix it we’ll never have empowerment that
means anything.”— Barry Gibbons
“ubuntu” (SA) … to
dehumanize another person
dehumanizes me; “agape”
(GR) … respect for the
humanity of the “other,” in
spite of who he was
Source: James Joseph/Duke
“The material of a strong, ethical base includes
honoring the people who do the work, respecting the
letter and the spirit of the law, and believing that a
company’s responsibility does not stop at the
community’s edge. Such a base has been my moral
compass. It guides me away from the sleek, the cut
corner, and the easy path. The foment about corporate
conduct has often come close to arguing that it is
wrong because it has been discovered. In truth, it is
wrong because it violates the most critical fundamental
of business. One behaves honestly because it is right,
because you ‘do unto others’—because you are
responsible for your life and, in your business, for the
lives of others. There is no option—no alternative.”
—Sidney Harman/Harman International
40. Leaders Say
“Thank
You.”
“The two most powerful things
a kind
word and a
thoughtful
gesture.”
in existence:
Ken Langone, CEO, Invemed Associates [from Ronna
Lichtenberg, It’s Not Business, It’s Personal]
“The deepest human
need to
be appreciated.”
need is the
William James
“We look for ...
“... listening, caring,
smiling, saying ‘Thank
you,’ being warm.”
— Colleen Barrett, President, Southwest Airlines
41. Leaders
Are …
Curious.
The Three Most
Important Letters …
TP/08.2001:
42. Leadership
Is a …
Performance.
“It is necessary for the
President to be the
No. 1
actor.”
nation’s
FDR
“You can’t lead a
cavalry charge if
you think you
look funny on a
horse.” —John Peers, President, Logical
Machine Corporation
Seven Seconds to Make an Impression
— Amp up your attitude [It’s energy,
stupid!]
— Recognize “face value” [no “poker face”]
— Give your message a mission [don’t
forget your agenda]
Source: Roger Alles, CEO, Fox News, Fast Company
43.
Leaders …
Are
The Brand
The BRAND lives (OR
DIES) in the “minutiae”
of the leader’s momentto-moment actions.
“You must be
the change you
wish to see in the
world.”
Gandhi
44. Leaders …
GREAT
STORY!
Have a
“A key – perhaps the key –
to leadership is
the effective
communication
of a story.”
Howard Gardner
Leading Minds: An Anatomy of Leadership
“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
Companies will
thrive on the basis of their stories
and myths. Companies will need to understand
to how we work with others.
that their products are less important than their
stories.”
Rolf Jensen, Copenhagen Institute for Future Studies
Leaders don’t just make products
and make decisions.
Leaders make
meaning.
– John Seely Brown
Stories … Paint me a picture …
Story “infrastructure” … Demos …
Quick prototypes … Experiments
… Heroes … Renegades …
Leadfrogs … Skunkworks …
Demo Funds … V.C. … G.M. …
Roster … Portfolio … Stone’s
Rules … JKC’s Rules
Introspection.
45. Leaders …
Enjoy Leading.
“Warren, I know you
want to ‘be’
president. But do
you want to ‘do’
president?”
“[Bertelsmann’s Reinhard]
Mohn wasn’t a creative type.
What got him juiced was the
art of running an
organization and motivating
the people who work there.”
—Fortune/05.27.2002
46. Leaders …
KNOW
THEMSELVES.
Individuals (would-be leaders)
cannot engage in a
liberating mutual discovery
process unless they are
comfortable with their
own skin. (“Leaders” who are not
comfortable with themselves become petty
control freaks.)
47. But … Leaders
have
MENTORS.
Upon
having the Leadership
Mantle placed upon thine
head, thou shalt never
hear the unvarnished
truth again!*
The Gospel According to TP:
(*Therefore, thy needs one faithful
compatriot to lay it on with no jelly.)
48. Leaders …
Take Breaks.
Zombie!
Zombie!
Zombie!
Zombie!
The End
Game.
49. Leaders
???:
“Leadership is the
PROCESS of
ENGAGING PEOPLE in
CREATING a LEGACY
of EXCELLENCE.”
“ ‘It’s only business,
not personal’ … IT
ALWAYS IS
PERSONAL.”
“Hire smart – go
bonkers – have grace –
make mistakes – love
technology – start all
over again.”
“LEADERS NEED TO
BE THE ROCK OF
GIBRALTAR ON
ROLLER BLADES”
50. Leaders Know
WHEN TO
LEAVE!
X. NEW
BUSINESS. NEW
RULES.
25. Tom’s
60TIBs*
*TIB = This I Believe
1. TECHNICOLOR RULES! (Passion
Moves Mountains!)
2. Audacity Matters!
3. Revolution Now!
4. Question Authority! (& Hire
Disrespectful People.)
5. Disorganization Wins! (LOVE THE
MESS!)
6. Think 3M: Markets Matter Most. ONLY EXTREME
COMPETITION STAVES OFF STALENESS. (You can
take the boy out of Silicon Valley, but you can’t take
Silicon Valley out of the boy!)
7. Three Hearty Cheers for Weirdos. (Bill Gates, Steve
Jobs, Larry Ellison, Scott McNealy, Craig Venter
et al.)
8. Message 2003: Technology Change (Info-sciences,
Biosciences) Is in Its Infancy! (WE AIN’T SEEN
NOTHIN’ YET!)
9. Everything Is Up For Grabs! Volatility Is Thy Name!
(Forever & Ever. Amen.) RE-INVENT … OR DIE!
10. Big Sucks. (Mostly.) (VERY Mostly.)
11. “Permanence” Is a Snare & a Delusion.
(Forget “Built to Last.” It’s Yesterday’s
Idea.)
12. Kaizen” (Continuous Improvement) Is …
Dangerous.
13. DESTRUCTION RULES!
14. Forget It! (“Learning” = Easy. “Forgetting” =
Nigh on Impossible.)
15. Innovation Is Easy: Hang Out with Freaks.
(Employees, Board Members, Customers,
Suppliers, Alliance Partners, Consultants.)
16. Boring Begets Boring. (Cool Begets Cool.)
17. Think “Portfolio.” (We’re All V.C.s.)
18. Perception Is All There Is. (“Insiders” …
ALWAYS … overestimate the Radicalism of
What They’re Up To.)
19. Action … ALWAYS … Takes Precedence.
Think: R.F!A./Ready. Fire! Aim. (REWARD
SUCCESS. REWARD FAILURE. PUNISH …
INACTION.)
20. He Who Makes & Tests the Quickest &
Coolest Prototypes Reigns!
21. Haste Makes Waste. (SO GO WASTE!)
22. Screw-ups are … the … Mark of Excellence.
(“Do It Right the First Time” Is a Very Stupid
Idea.)
23. Play Hard! Play Now! (Cherish Play!)
24. TALENT TIME! (He/She Who Has the Best
“Roster” Rules!)
25. Re-do Education. Totally. (FOSTER
CREATIVITY … NOT UNIFORMITY.) (THE
NOISIEST CLASSROOM WINS.)
26. Diversity’s Hour Is Now!
27. SHE … Is the Best Leader!
28. MARKETING MANTRA: Embrace the “BIG THREE”
Demographics. (1) SHE … is the Customer. (For
everything.) (2) Rapidly Aging Boomers Have …
ALL THE MONEY. (3) Green … Matters.
(TRILLIONS OF $$$$$ Are at Stake.) (NOBODY …
Gets It.) (Mere “Programs” Will Not Suffice.)
29. Re-boot Healthcare. (UNDERSTATEMENT.)
30. WHAT ARE WE SELLING? “Experiences” &
“Solutions” > “Quality” & “Satisfaction.” (The
Traditional Value-added Equation Is Being Set on
Its Ear.)
31. DESIGN = New Seat of the Soul.
32. Branding Is for … EVERYONE. He Who Has
the … BEST STORY … Takes Home the
Marbles.
33. DRAMATIC DIFFERENCE = Only Difference.
34. WORDS/Language Matters … a Lot. (E.g.:
Three Hearty Cheers for “Wow”!)
35. WHAT MATTERS IS STUFF THAT MATTERS.
(Query #1: “Are You Proud of It?”)
36. eALL. (IS/IT: Half-way = No Way.)
37. DREAM … Big! DREAM … Enormous.
DREAM … Gargantuan. (These Are XXXL
Times.)
38. THINK MIKE! (Michelangelo: “The greatest
danger for most of us is not that our aim is
too high and we miss it, but that it is too low
and we reach it.”)
39. There Is Only … ONE BIG ISSUE. Crossfunctional Communication.
40. Stop Doing Dumb Shit. (SYSTEMATIZE THE
PROCESS OF “UN-DUMBING.”)
41. Beautiful Systems Are … BEAUTIFUL.
42. The … WHITE-COLLAR REVOLUTION … Will
Devour Everything in Its Path.
43. Take Charge of Your Destiny! BrandYou
Moment! DISTINCT … OR EXTINCT!
44. “Powerlessness” Is a State of Mind! Think:
King. Gandhi. DeGaulle.
45. Pursue Adventure … in Every Task.
46. EXCELLENCE … Is a State of Mind.
(Excellence Takes a Minute.) (No Bull.)
47. SHOW UP! (If You Care, You’re There.)
48. YOUR CALENDAR KNOWS ALL. (You =
Calendar.) (Mind Your “TO DON’T” List.)
49. LIFE IS SALES. (The Rest Is Details.)
50. Boss Mantra #1: “I DON’T KNOW.” (“I Don’t
Know” = Permission to Explore.)
51. Management Role 1: GET OUT OF THE WAY.
(Clear the Way.) (“Manager” = Hurdle
Removal Professional.)
52. Epitaph from Hell: “He Woulda Done Some
Truly Cool Stuff … But His Boss Wouldn’t
Let Him.”
53. Change Takes However Long You Think It
Takes. (Eschew … “Incrementalism.”)
54. Respect! (Rule 1: Don’t Belittle!)
55. “Thank You” Trumps All!
56. Integrity Matters! Integrity = Credibility.
(Dennis K. Is a Jerk.)
57. SOFT IS HARD. HARD IS SOFT. (Numbers
Are Soft. People Are Not.)
58. Try Sunny! (Sunny Begets Sunny.
Gloomy Begets Gloomy.)
59. DISPENSE ENTHUSIASM!
60. FUN …Is Not a 4-Letter Word. So, too …
JOY. (And … GRACE.)
Successful Businesses’ Dozen Truths: TP’s 30-Year Perspective
1. Insanely Great & Quirky Talent.
2. Disrespect for Tradition.
3. Totally Passionate (to the Point of Irrationality) Belief in What
We Are Here to Do.
4. Utter Disbelief at the Bullshit that Marks “Normal Industry Behavior.”
5. A Maniacal Bias for Execution … and Utter Contempt
for Those Who Don’t “Get It.”
6. Speed Demons.
7. Up or Out. (Meritocracy Is Thy Name. Sycophancy Is Thy Scourge.)
8. Passionate Hatred of Bureaucracy.
9. Willingness to Lead the Customer … and Take the Heat Associated
Therewith. (Mantra: Satan Invented Focus Groups to Derail True
Believers.)
10. “Reward Excellent Failures. Punish Mediocre Successes.”
11. Courage to Stand Alone on One’s Record of Accomplishment
Against All the Forces of Conventional Wisdom.
12. A Crystal Clear Understanding of Brand Power.
Have you
changed
civilization
today?
Source: HP banner ad
“Dream as if
you’ll live forever.
Live as if you’ll
die today.”
—James Dean
T. J. Peters
1942 – 2--HE WOULDA DONE SOME
REALLY COOL STUFF
BUT …
HIS BOSS WOULDN’T
LET HIM!
T. J. Peters
1942 – 2---
HE WAS A PLAYER!
“May you live
all the days of
your life.”
— Jonathan Swift
“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.”
— Émile Zola
It is the foremost task—
and responsibility—
of our generation to
re-imagine our
enterprises, private
and public. —from the Foreword,
Re-imagine: Business Excellence in a Disruptive Age
The Re-imagineer’s Credo … or,
Pity the Poor Brown*
Technicolor Times demand …
Technicolor Leaders and Boards who recruit …
Technicolor People who are sent on …
Technicolor Quests to execute …
Technicolor (WOW!) Projects in partnership with …
Technicolor Customers and …
Technicolor Suppliers all of whom are in pursuit of …
Technicolor Goals and Aspirations fit for …
Technicolor Times.
*WSC
Technicolor
Action
Failure
Forget
Destroy
Weird
Passion
Enthusiasm
Quest
Audacity
Grace
Appreciation
Portfolio/Roster
“In Tom’s world it’s always
better to try a swan dive and
deliver a colossal belly flop
than to step timidly off the
board while holding your
nose.”—Fast Company /October2003
Thank You
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Issue Y2K The Great War for Talent!