Sue your way to a better Gartner MQ position

dollar's flow in black hole

NetScout has just filed a lawsuit against Gartner because they were ranked a “Challenger” claiming it was punishment for not spending enough with Gartner. David Carr examines this issue in an article in Information Week.  But is it the only way?

If you are a multi-million dollar vendor then perhaps you can spend your way into the MQ. I couldn’t possibly comment. But if you are a smaller,  innovative and growing software vendor, that is not an option. But if you are going to accelerate growth without piling on expensive sales guy and make it easier for the large corporates to find you and get comfortable placing big orders with you, then you need to create relationships with the analyst community.

Analysts are important

Analysts have the ear of people with the purse strings. When they speak, the C-Suite listens. When a company goes out to tender for a third party product invariably an analyst will be involved in the decision making process, whether directly as a result of a consultation or indirectly through a research paper. They are able to influence not only potential customers, but they also coach and advise your potential acquirer on their product strategy including which vendors to buy.

Being included in an analyst research note is worth more than 100 blog posts, column inches in the FT/ WSJ or exhibiting at the next xyz conference. You need the analysts, whether you like it or not, to survive in both the short-term and thrive in the long term because their word carries weight. If a customer refers to an analyst for a product shortlist and you’ve never engaged with the analyst you can guarantee you’ll never make that list no matter how mind-blowingly awesome your product is.

Analyst Relations (AR) can deliver far greater short term and long term tangible benefits than any PR campaigns. Yet many vendors start engaging PR before they even consider AR.

It’s never too early

It takes time to build a relationship with the right analysts that cover your product’s area. Let’s not confuse a relationship with meeting the analyst once or twice and fire-hosing them with your product pitch. You are aiming for a relationship of mutual respect, and that takes time to develop which is why engaging as early as possible is critical for survival for a startup. Done well it can position a vendor ahead of the short list in product selections and gain the attention of the leaders of industry, the media, and the competition. Poor (or no) analyst relations can result in your product being ignored by potential clients and it may limit your penetration in your existing clients

Being spotted by an analyst early on is major kudos for a small company but also for the analyst because they love to be the one who discovered a cool new vendors and write about them. And it’s also their opportunity to help you out and form part of your success. Analysts are no different from anyone else, they love being part of the action and have an ego to fuel. And again, it can’t be stressed enough, if they don’t know you neither will their clients when they ask about the market.

But they are expensive and we don’t have the time!

Certainly there are costs with engaging with analysts. Most charge an annual fee to be a client and have access to the analysts and research. But don’t think that you can buy your way to the top of a Magic Quadrant or Wave, or into the minds of the analysts. Or that paying for one or two consulting engagements with the analysts will do it. Think relationship, not prostitution.

Often it is the amount of money that vendors perceive they have to spend which stops them building a relationship with the analysts. The issue is most vendors spend too much money in the wrong places. It doesn’t have to be that way.

And apart from the hefty fees they ask you to sign up for there’s also the potential overhead of someone in an Analyst Relations role. Traditionally this is a new, fairly junior hire or it is outsourced to a PR/AR agency. Both of these lead to the wrong relationship being developed with the analysts, but it is a very common mistake.

Analysts need to be briefed on product functionality, but they are far more interested in customer stories. However, meeting or calls with analysts, understanding their needs and providing the information they need in the format that they want can be time consuming. They often feel like they are more difficult to deal with than clients. But they can afford to be as their influence and value is so much greater than even your best client.

What is required is a carefully crafted strategy and deep understanding of what drives analysts and how they operate. It also needs someone who has the ability and gravitas to engage them as peers and forge that professional relationship your company and product deserves. It’s not about booking appointments or grovelling for time. It is the role of a senior exec or founder who inevitably has other priorities – company operation, client sales or product strategy.

So how do I make this work?

Few senior executives have engaged with analysts or developed an effective analyst strategy. And with conflicting priorities they do not have the time or luxury to learn. But companies readily hire a Non Exec Director to add an external perspective, exercising their ancient Rolodex and to sit on a board. Their brief is often financial or governance and they offer pithy advice like “if you sell more and spend less”.

A more cost effective approach is to hire a Non-Exec Director or Advisor who understands Analyst Relations and can help shape the analyst strategy, coach the senior team on the best way to engage with analysts, and act as a sounding board for decisions. They will add more value to the business as your go to market plans are meaningless without the visibility in the market that strong analyst relationships will bring.

For the price of a junior in your AR/PR firm you can bag a NED or Advisor who knows how to tango with the analysts.

In summary: Brains, not budget. And leverage the skills of others.

This post was co-authored with Theo Priestley  He has written analysis on the industry and tech space in general since 2007 which isn’t long to get the notoriety and recognition he has earned. He has collaborated with and advised the large and the small, from stealth startups to industry established players, introducing new ideas and connections, adding value, industry insight, analyst relations and marketing analysis for those who ask for it.  As an independent business transformation consultant of over ten years he is closer to the real enterprise issues that keep the execs up at night and what they’re looking for to solve them.

#BPM is dead. Nothing to see here. Move along

Process

Like the frog in water being steadily heated that it doesn’t notice the change until it boils to death, “BPM” (vendors, analysts, bloggers) have not recognised the gradual shift. But, the signs of BPM death are all around. Sorry to sounds so negative, a but pessimist is what an optimist calls a realist.

No one is buying BPM. Customers are buying “increase sales effectiveness”, “more engaged customer experience”, “more responsive support”, “regulatory compliance”, “better shared services”…… All these require BPM techniques, methodologies and technologies.

Which leads me to – BPM is embedded in specific applications such as CRM, Support, Call Centre, Compliance.

So the role of generic BPM is dead. It is everything and nothing.

Case in point. Cordys, who has “a next generation Business Process Management Suite” was recently bought by OpenText for $33m. Cordys has had $180m of investment. And then compare it with the explosive growth in vendors selling BPM wrapped up as customer service, or support, or even managing expenses etc etc.

Robin Williams (RIP) – upstaging #TED conference

BuzJMJ2CEAERlaq

Robin was such a talented actor but had such a quick and brilliant mind that he set the standard for improv around the world. The world will be a less special place without him. RIP

Here is classic Robin Williams. During technical difficulties at a TED conference in London he gets up and improvises. Brilliant for the audience, but it probably left the TED speaker backstage who were due to go on feeling woefully inadequate.

Why internal BPM projects fail

drivers_education

We have just completed a 12 week project where I have been the Program Manager for a critical business transformation project for a multi-national company that delivers major ($1-10 billion) projects for clients. The first phase, which has just finished, was a proof of concept. The objective was to develop a hierarchical process map for their Deliver Project process. But as it is so huge – 90% of the employees are delivering projects – we were asked to only map down a few levels. In fact is many places we went down much further. Down far enough to prove that the approach would work, to build a business case for roll-out and develop implementation plans.

Therefore my Q9 team facilitated the workshops and developed the process maps. The client staff were the subject matter experts in the workshops; engaged but innocent bystanders.

For the next phase the client has only just decided that they want to pick up where we have left off. They want us to train a couple of their team to use the mapping tool and they will take it from there. But I can see that this could be high risk approach. They have been involved in some workshops and mapping. They have not been exposed to what is the most important part; thinking about how to personalize and present the content to the end users so that they actually want to use it, and then encouraging or driving adoption.

Don’t get me wrong. I have absolutely no interest in spending the next year away from home working at the client. So my comments are not a way to generate follow on work for me or the team. But the client doesn’t know what they don’t know. The initial project had no element of skills transfer as it was not scoped or planned that way by the client as it was expected that this would be in a second phase. Plus my team are so polished at facilitating the workshops, they have made it look easy. The client doesn’t really appreciate what is “going on behind what is going on”; the preparation before the workshop, the facilitation techniques, the years of experience of capturing complex processes and making them intelligible.

Sure we have developed a detailed set of implementation recommendations that include the cost benefit case, implementation plans and technical implementation guidelines. But only when you start implementing the processes into a live project will you start uncovering the issues that need to be resolved. That will require a deep knowledge of BPM and experience of implementing process-centric programs.

Learning to drive is a lovely analogy.

To date the client has been sitting in the back seat and we have driven down a relatively straight road. The drivers (my team) are so skilled that gear changes and avoiding the odd pothole have been imperceptible from the back of the car. The ride has seemed beautifully calm and easy.

So running a product training course will teach the client how the car works. And we have given them a destination and roadmap; the implementation recommendations. But it will not prepare them for the issues on the open road; other road users, pedestrians stepping out, the driving rain or the odd patch of ice, whilst trying to remember how to change gear. Dealing with those without crashing is built up of years of experience on the road, and the inevitable near misses.

The client is considering asking us to spend a little time supporting them as they get going. That is analogous to sitting in the passenger seat whilst they learn to drive. As any driving instructor or parent of teenage children will tell you is a very scary experience. Fighting the urge to grab the wheel. Some of you may remember the fantastic Bob Newhart sketch, “The Driving Instructor”.

Implementing a process-driven approach, changing engrained working approaches and getting engagement across hundreds of projects spread around the world makes learning to drive look like “Driving with Miss Daisy”.

So why is does the client want to do it themselves? It is not because they are unhappy with our work, as they have told us several times how impressed they are with my team. They run huge, complex projects so perhaps they believe, having watched us that they understand what to do.

Or maybe it is the normal issue: cost. The value of external BPM consultancy is always questioned, particularly in construction firms who are notoriously tight-fisted. They probably think we are expensive, but we are not nearly as expensive as ignorance. And the cost of ignorance is not “getting it wrong”, but it is about “not getting it right”. We have conservatively identified $4m of savings per project which means $150k per day for the company if it was rolled out to just the major projects around the world. And they are running hundreds of projects around the world concurrently. Implementing successfully in all those projects will have a material affect on the company bottom line.

We have spent 12 weeks understanding their project processes.  I have run some large projects in my time, but that doesn’t mean I could do what they do after just 12 weeks. So why would they think that they could do what we can do?  Perhaps that is why BPM projects fail. It doesn’t look that hard.

I hope it ends well as the client has been the best we have worked with in the last 15 years. Open minded, engaged and super organized. For their long term profitability, growth and success, they desperately need this to work. And they know it.

Why AR comes before PR. Just look in the dictionary

gears in skull

You’re an innovative and growing software vendor, I get that. You’ve got a fab new product that’s going drive dramatic benefits for enterprise customers, I get that.You’ve even got a blog to push out great customer stories now and then, I get that too.

But how do you accelerate growth without piling on expensive sales guys? And how do you make it easier for the large corporates to find you and get comfortable placing big orders with you?

ANSWER: You create relationships with the analyst community. And here’s why.

Analysts are important

Analysts have the ear of people with the purse strings. When they speak, the C-Suite listens. When a company goes out to tender for a third party product invariably an analyst will be involved in the decision making process, whether directly as a result of a consultation or indirectly through a research paper. They are able to influence not only potential customers, but they also coach and advise your potential acquirer on their product strategy including which vendors to buy.

Being included in an analyst research note is worth more than 100 blog posts, column inches in the FT/ WSJ or exhibiting at the next xyz conference. You need the analysts, whether you like it or not, to survive in both the short-term and thrive in the long term because their word carries weight. If a customer refers to an analyst for a product shortlist and you’ve never engaged with the analyst you can guarantee you’ll never make that list no matter how mind-blowingly awesome your product is.

Analyst Relations (AR) can deliver far greater short term and long term tangible benefits than any PR campaigns. Yet many vendors start engaging PR before they even consider AR.

It’s never too early

It takes time to build a relationship with the right analysts that cover your product’s area. Let’s not confuse a relationship with meeting the analyst once or twice and fire-hosing them with your product pitch. You are aiming for a relationship of mutual respect, and that takes time to develop which is why engaging as early as possible is critical for survival for a startup. Done well it can position a vendor ahead of the short list in product selections and gain the attention of the leaders of industry, the media, and the competition. Poor (or no) analyst relations can result in your product being ignored by potential clients and it may limit your penetration in your existing clients

Being spotted by an analyst early on is major kudos for a small company but also for the analyst because they love to be the one who discovered a cool new vendors and write about them. And it’s also their opportunity to help you out and form part of your success. Analysts are no different from anyone else, they love being part of the action and have an ego to fuel. And again, it can’t be stressed enough, if they don’t know you neither will their clients when they ask about the market.

But they are expensive and we don’t have the time!

Certainly there are costs with engaging with analysts. Most charge an annual fee to be a client and have access to the analysts and research. But don’t think that you can buy your way to the top of a Magic Quadrant or Wave, or into the minds of the analysts. Or that paying for one or two consulting engagements with the analysts will do it. Think relationship, not prostitution.

Often it is the amount of money that vendors perceive they have to spend which stops them building a relationship with the analysts. The issue is most vendors spend too much money in the wrong places. It doesn’t have to be that way.

And apart from the hefty fees they ask you to sign up for there’s also the potential overhead of someone in an Analyst Relations role. Traditionally this is a new, fairly junior hire or it is outsourced to a PR/AR agency. Both of these lead to the wrong relationship being developed with the analysts, but it is a very common mistake.

Analysts need to be briefed on product functionality, but they are far more interested in customer stories. However, meeting or calls with analysts, understanding their needs and providing the information they need in the format that they want can be time consuming. They often feel like they are more difficult to deal with than clients. But they can afford to be as their influence and value is so much greater than even your best client.

What is required is a carefully crafted strategy and deep understanding of what drives analysts and how they operate. It also needs someone who has the ability and gravitas to engage them as peers and forge that professional relationship your company and product deserves. It’s not about booking appointments or grovelling for time. It is the role of a senior exec or founder who inevitably has other priorities – company operation, client sales or product strategy.

So how do I make this work?

Few senior executives have engaged with analysts or developed an effective analyst strategy. And with conflicting priorities they do not have the time or luxury to learn. But companies readily hire a Non Exec Director to add an external perspective, exercising their ancient Rolodex and to sit on a board. Their brief is often financial or governance and they offer pithy advice like “if you sell more and spend less”.

A more cost effective approach is to hire a Non-Exec Director or Advisor who understands Analyst Relations and can help shape the analyst strategy, coach the senior team on the best way to engage with analysts, and act as a sounding board for decisions. They will add more value to the business as your go to market plans are meaningless without the visibility in the market that strong analyst relationships will bring.

For the price of a junior in your AR/PR firm you can bag a NED or Advisor who knows how to tango with the analysts.

In summary: Brains, not budget. And leverage the skills of others.

Corporates: pay your bills on time

bullying2

Payment terms of 30, 45 and 60 days are not unknown. But the time it takes big companies to pay their little suppliers can be as much as 120 days, and it is getting worse with the average now 58.5 days according to a report by D&B. This is not only tantamount to corporate bullying, but also BAD FOR BUSINESS.

Paying bills on time, whether you are a large corporate, an SME or a consumer has a dramatic effect on the money supply. And this has a positive impact on US businesses.

Not convinced?

If a large corporate pays its invoice to a smaller supplier after 15 days instead of 45  several things happen:

-  the supplier can pay its suppliers for products purchased, often on a credit card with 30 days terms, and its employees, who are paid monthly, WITHOUT driving up its working capital requirements

- this means that there is no need to burn up time with the banks trying to agree a working capital loan, and eliminates the set up fees, interest payments and lawyers fees

- it means that supplies can grow more easily and therefore employ more people and pay more taxes

- time is not spent by supplier’s admin staff chasing the large corporates and listening to their ‘standard Accounts Payable lies‘  –   “it will be in the next payment run”, “you just missed the cutoff for this month”, “the person who has to approve it is not in this week”., “we can’t find it so can you resend it” and so on.

- most small business, which have great products, dedicated staff and huge potential are killed by cash flow problems.

So why do we as companies or even as consumers fail to pay our bills on time?

There are number of reasons

There is the view that we will somehow benefit from hanging onto the money. But this is no longer true with interest rates hovering around 0%.

Companies think hanging onto the money will make their balance sheet look good, but this is not true because the unpaid invoice appears on the balance sheet as a liability.

Companies of every size, even large companies, have customers who are delaying paying their bills- all the way down the supply chain   ie shit flows downhill

Many suppliers do not make it easy to be paid. Their invoices are inaccurate so matching invoice to Purchase Order and goods receipt note is difficult. But also then need to make it easy to pay bills electronically.

And finally, many large corporates are just plain inefficient.  Their Procure2Pay processes are shocking often supported by multiple disconnected IT systems.  Staggeringly, in the US many large corporates are still paying invoices by cheque (check). When working in our San Francisco office I would often open up the morning post and find checks for $50,000, $100,000, $150,000 or more.

So what can be done about this?

  1. CFO’s of companies at every level need to realise the huge damage that their late payment approach is doing to the entire supply chain. If one of their key suppliers goes under because of cash flow problems that stem from late payments, they they are hurting themselves.
  2. The endemic ‘pay late’ culture needs to be broken and this has to be lead from the top. And it is the leaders of the countries largest companies who need to initiate it.  BUT THEY ARE NOT.  Payment terms of 60 days in contracts are common place. And you can guarantee that they will string it out payment way longer than that.
  3. The Government, rather than beating up banks to lend more, should instead focus on big corporates and their own Government finance departments to encourage them to pay more quickly.  BTW the Late Payment Directive has no teeth and is largely ignored
  4. Suppliers need to get more professional and diligent about their invoicing
  5. Companies need to review, simplify and drive out non value added activities from their Procure2 Pay processes.

I am happy to help facilitate the process mapping.  But the payment terms are ‘cash up front’.

Are you a radiator or a drain?

Screen Shot 2014-07-15 at 10.25.22

Oprah Winfrey, was asked what she wished she’d learned earlier in life said “I wish I’d known how to distinguish radiators from drains”.

Radiators are people who give out warmth, kindness, love, honesty, positivity, energy, enthusiasm and all the good things which people need and respond to.  Drains are people who are negative, downbeat, suck the energy out of others  and don’t like themselves.

So life’s too short to work with drains …………… unless of course you’re Dynorod.

So how does this work in practice?  Sir Clive Woodward, coach of world cup winning England Rugby team in 2003 inherited a set of players.  For a number of matches he was selecting on their match playing abilities – on their rugby skills.  But a training camp with the Royal Marines made him change his mind about team selection.  The Marine’s words were ringing in his ears “It’s not about skills. It’s about attitude and the effect on the team. One wrong team player can sap all the energy from the group.”

The ultimate test is going into battle, ie the Royal Marines. You’re in the helicopter with 8 of your team going into a firefight. Looking around those 8 individuals you need to be very clear that they are the right people – energisers, not energy sappers. So with sport the results are  very visible. There is no place to hide.  Win or lose.

So does this work in businesses?    It is totally true but decisions that could and should have been made about staffing are fudged and avoided.  There appears to be less at stake in business compared with sport.

So what are you….  And if you are a drain can you change?   Here are 3 steps

1. Recognise if you are drain (or have drain-like moments)
2. Catch yourself once a day about to say something drain-like, turn it around and look for the bright side
3. Do this every day for 21 days and you will be staggered by the results

My latest brilliant idea. www.monkeygirlfriend.com

can-you-get-you-ex-girlfriend-back

Based on the success, measured by column inches, of MonkeyParking I have decided to launch MonkeyGirlfriend. And possibly a sister site MonkeyExWife.

For those of you not up to speed on the latest app, MonkeyParking, it has hit on the brilliant idea of allowing someone to be paid to tell others that they are about to leave a parking space. It has caused a huge uproar as some have deemed that a person is selling a public parking space. The MonkeyParking CEO is refuting this, and is in a battle of words with the San Francisco City Attorney Dennis Herrera who has asked him to stop trading.  Herrera has just issued a cease-and-desist demand today to Monkey Parking, an iOS app that lets users bid for other people’s parking spaces. The letter cites San Francisco Police Code section 63(c) that states: “It shall be unlawful for any person, firm or corporation to enter into a lease, rental agreement or contract of any kind, written or oral, with or without compensation, for the use of any street or sidewalk.”

MonkeyParking is claiming that the app is not selling a public parking space, but the convenience of knowing that a space is about to become free.

Brilliant, just brilliant

Which is where the brilliance of MonkeyGirlfriend lies.  How many times do you see a girl you fancy, but find that she is in a relationship? But you know at some point that she will split up with him and be available. But you don’t know when that will be.  How much would you pay to know that she has just, or is about to, break up with her boyfriend?  Knowing that you can be perfectly positioned to become her new boyfriend, with the added benefit that your timing is perfect to catch her on the rebound. Thereby improving your chances of scoring. Brilliant.

 

 

What if I was wrong all these years?

swimlanes

As founder and CEO of Nimbus I spent 14 years evangelizing the importance of processes as a way of driving improved operational performance. I don’t think anyone in the BPM community would have issue with that.

Since Nimbus was acquired by TIBCO over 2 years ago, I had very little to do with processes and clients directly. In December was then asked by an ex-Nimbus client to support him as the Program Manager on a major transformation at the company where he had joined as SVP. The company, a major global engineering and construction firm desperately needed to drive some standardization, risk management and accountability into the way it delivers major projects.

So I am now back in the thick of process mapping, running a great team, which is fun as we see the client’s excitement build in the live workshops. The hierarchical mapping approach is so powerful in helping them understand what they (should) do, from the high level “Deliver Project”, the hand-offs between departments and the critical stage gates that can help reduce risk.

Which got me thinking. Have I been wrong all this time?

Are the principles, that we, and our clients, have lived and breathed for over a decade, correct? The guiding principles can be described simply as: easily understood process diagrams that fit on a single sheet, even for large cross functional processes

  • simple mapping approach with boxes and lines; not swimlanes, flowcharts or BPMN diagram notation
  • diagrams organised as a hierarchy; not single diagrams
  • deployment to the masses is the aim; not analysis for the few or just a per-cursor to workflow
  • making the process content consumable by a wide range of stakeholders; end users, risk & audit and IT
  • role-specific guided walk-throughs overlaid on the process diagrams

So, if the hierarchical mapping approach (which has its origins in IDEF0  ) seems to work so well, why are we surrounded by business people drawing single level process diagrams using Visio Powerpoint and even Excel in swimlanes? Once they see the hierarchical mapping approach they are instantly converted, but are we expected to be evangelists forever?

I remember the saying “Eat shit – 100 billion flies can’t be wrong!” So all the millions of people drawing swimlanes – are they right or are they simply waiting to discover the power of hierarchical mapping and swimlanes are the default because that is what Visio does? Also, consider the new web-based, and very elegant, diagramming tools that have emerged that only draw single level diagrams and swimlanes, like gluu.biz and the free http://www.draw.io. Are they responding to a need or simply chose to develop a less complex application to code? As Steve Jobs famously said “It’s really hard to design products by focus groups. A lot of times, people don’t know what they want until you show it to them.” Henry Ford (allegedly) said that if he had asked his customers they would have said they wanted faster horses.

Hierarchical process maps  or single diagram swimlanes? Which is best?

So, finally with no axe to grind I am genuinely interested in the answer.

Get inside the mind of the very very best speakers

Screen Shot 2014-05-25 at 22.32.21

In the pecking order of presenters, stand up comedians are at the very top. Sadly most business people are near the bottom just above the best man at a wedding.  But for those who really want to stretch and improve ourselves (myself included) it is fascinating to understand “what is going on behind what is going on” by hearing the thinking, philosophy, the drivers and approach of the very best stand up comedians in the world.

Here are four of them – Jerry Seinfield, Chris Rock, Louis C.K. and Ricky Gervais talk very candidly about how they think about their work, how they prepare, and other stuff.

Pure gold dust

 

Big data is (very) old news for sportsmen

nz haka2

As the momentum grows for big data in businesses, it is sometimes useful to look outside to other markets to get a sense of what is happening or where the future lies. Sports is often held up as a useful metaphor for business as the results are very visible and therefore the players and coaches have nowhere to hide.

The most obvious examples are Formula1 where the cars stream gigabytes of data every race. More recently the power of big data came to the America’s Cup to both measure the performance of the boats but also to make is easier for spectators to understand what the hell was going on. With complex machinery – Formula1 cars and America’s Cup yachts – you can understand how big data can make a difference and why it has grown in the last year or two.

So it is slightly surprising to learn that sports with just a team of players on the pitch are able to reap the benefits of big data. As the video below shows, the ability to keep the team performing at peak levels during training is amazing. And what they have discovered is that the players gain from the immediate feedback. They have a better understanding of what is expected of them so they can self-train – in the moment.

What is most surprising is that this video was shot in 2010 – over 3 years ago.   Businesses are nowhere near this use of big data. The idea of measuring individuals’ performance real time and helping them improve and perform at their best, or monitoring customer behaviour and adjusting a website dynamically, is a pipe dream. Big data for business has a long way to go, and sports can lead the way.

Happiness has a Return on Investment

I have written a number of posts about the importance of happy staff.  One of the favorites was Happy Staff. I run a business not a bloody holiday camp.  We all spend too much time at work vs doing what we want and being who we want to be with. My pet saying is “Life is not a dress rehearsal”. You get one go at life, so make the most of every day. Find magic in every moment.

That doesn’t mean be a clown or silly. I have fun but can still be professional and get the job done. But my “happier” way means I have a better time, and so do the people around me. At Nimbus we built a great company with fantastic growth, delighted clients and an awesome culture.

Here is another company who is doing even better. And they believe happiness is the new ROI. Here is their CEO, Shawn Riegsecker, speaking at TechWeek in Chicago. And this is NOT just words.  If you take a look at the company reviews on GlassDoor.  Now, if you dare, take a look at your company.

 

 

I am not loyal to my airlines. Why should I be?

For years I have collected miles with a few different airlines, but have managed to fly only twice using my miles. Here, in one sentence, you have the problem with airline loyalty programs, but also my loyalty strategy.

Airlines want you to fly with only them and collect miles. But they really don’t want you to use the miles to fly – or so it would seem from the way the programs are structured. It is a “game” and you need to understand how to play in order to win. In fact, modern loyalty programs are morphing based on gamification techniques. More on this later.

Flawed Loyalty Strategy

Having been treated to a Loyalty101 class by an American colleague, I’ve discovered I’m doing it wrong. First, you need to fly with just one carrier, no matter how inconvenient it may be in terms of routing, to make sure that you are at the highest level in the loyalty program. These high levels are the only place you get real benefits. My loyalty mentor has over 1 million miles on United and gets access to lounges, automatic upgrades, and priority access to seats. And on every upgraded flight, she collects miles at a higher rate – like compound interest. So she will happily take United flights which include a change rather than take a direct flight with an alternative carrier.

I probably have earned as many miles as her collectively and had 100,000s expire. But I am only Silver on British Airways, Silver on Virgin and nothing on United. And this is a flawed strategy on my part. Years of choosing based on price and route rather than being single-mindedly loyal has hurt me significantly.

Perhaps if they all merged, I would be able to consolidate my miles. However, there is more chance of me getting my own jet than Virgin merging with British Airways!

Let me use my miles. Reward me.

A case in point is a recent flight from Washington DC to London. I was in Premium Economy on an overnight flight with a busy day ahead of me when I landed. I have a load of miles I would have happily traded for an upgrade and a flat bed. I even had the right class of seat that could be upgraded, but the only Business Class seats that were eligible for miles were booked by tourists probably 6 months earlier. I defy anyone to book a flight using miles less than 6 months ahead of the flight. But my work schedule does not allow me that level of planning. The few miles-related seats go instantly. British Airways is not alone in this either.

Back to my Washington DC – Heathrow flight. How galling was it to walk through Business Class and discover it was half empty. A truly proactive loyalty program would have offered me an upgrade which would have achieved 3 things:

  • used up my balance of miles without costing British Airways anything, as the seats were empty and once the plane took off would never be full
  • given me a taste  of Business Class potentially getting me to upgrade with money next time
  • made me feel that the British Airways loyalty program was working for me, encouraging me to spend more time on British Airways

Instead, it was a negative experience full of wasted opportunity.

The technology is available to generate proactive decisions either at check-in or during boarding, but it seems that airline program has not moved on in the last 20 years. While all around them retailers have embraced gamification and created innovative programs which make the airlines look even more like luddites.

The Future, Now: The North Face

Look no further than The North Face, where the VIPeak program rewrites the way customers are engaged around their passions and not just their purchases. The North Face knew that staying competitive in the tough world of retailing required a new look at the customer and what creates a more enjoyable and meaningful experience. This was ultimately the only way to create a greater lifetime customer value for the brand.

As consumers experience programs like that of The North Face, the novelty of simply earning points based on purchases goes away. New and innovative programs are opening the customers’ eyes and setting new expectations. Loyalty is the new field of competition.

This means loyalty has become something much more dynamic than in the past. It has to evolve with the consumer and the competition. It stops being a hard-coded application, implemented and changed with teams of technology people, and becomes a platform that faces the business—flexible, nimble and cloud-based.

People, Process, Technology

Reinventing loyalty means more than a clever program. It requires changes to virtually all customer-facing processes and also some back-office processes. This also means many people in the organization will have their jobs tweaked or dramatically changed. Suprisingly, the easy bit is the technology. There are applications focused on loyalty such as Loyalty Lab which was recently acquired by TIBCO.

As part of that acquisition, TIBCO gained a team of consultants who have lived and breathed loyalty for years. If you want to gain insights into the changing world of loyalty, they have recorded a webinar called Customer Loyalty Management: Marrying the Art and Science of Loyalty. http://forms.loyaltylab.com/webinar_clm_access to listen to the recording.

Practical Ideas

I have promised to give some practical ideas in my articles rather than just rant. Some of the benefits of the higher tiers of airline programs are when you are on the ground, but make a difference to your experience in the air: priority booking seats, buying seats with leg room, using the airport lounge, using the fast track security and immigration channel. I would happily use my miles to buy an upgrade from Red/Blue to Silver or Gold. The cost, or lost revenue, to the airline is minimal. It is easy to implement. And it will drive up loyalty – which is what the loyalty program is meant to do. There is a clue in the name.

Finally, a Master Class in Loyalty from Ferrari

Ferrari has just released their latest supercar, the oddly named LaFerrari, at the Geneva motorshow. It is an arms race between them, Maclaren, Porsche and Lamborghini. LaFerrari has 963 bhp, approximately 4 times the power of your Golf GTi . But forget the stupid performance statistics. Instead ,lets examine the inspired sales strategy. There are some clever loyalty principles at play when you understand their strategy.

At a price of 1 mllion Euros and only 499 available it guarantees exclusivity and drives up demand. 350 have already been bought. But to buy one you have to have at least 5 Ferraris in your garageat the moment which means it is only being sold to collectors, not speculators, so there won’t be used models or pre-ordered cars hitting the second-hand market which hurts brand reputation. Inspired.