I mean in a good way. Not manipulation. Their ability to drive powerful emotions in you is part of the magic of being a parent. There are the 2 obvious ones, but a 3rd surprising one:
When your child is performing on stage, comes back with a string of A+ results, is on the winning team, is singled out for their support of others.
You see it coming, but can’t stop them taking a massive fall – both physically (climbing, skiing, wakeboarding) or in terms of relationships with friends.
But one came out of left field today. First you need the context:
The next big thing: The launch of Q9 Elements has been the talk of the dinner table as I work through the details and prepare for the March 18th launch. Q9E is taking everything we learnt in Nimbus over the 15 years, delivered through the cloud, offered at a fraction of the cost and then extended to offer “low-code” workflow automation. I am very excited as we are “getting the Band back together” – the Nimbus executive team. We worked well together and delivered results; over the life of Nimbus we generated over $100 million of revenue. And there is clearly a strong unmet need and we still have great relationships back in the BPM market. So I am feeling confident that this could work. Unlike the last one!!
The last one: On a high of having built Nimbus and then sold it, we looked at the market and launched ZenAlpha. Surely everything we touched would turn to gold. There was a huge market (events) and clear need (better internal planning and management of events) but once we had built the product we discovered there was no demand. Sadly we needed a product to prove that. Luckily it was just our own money we invested and didn’t burn any VCs. Elizabeth Gilbert, author of Eat, Pray, Love put it well, and I summarise. “How do you follow a success? Your next thing is always going to fall short. So get on with it and get through it.” To hear her put it far more eloquently, watch this excellent TED video.
So what was that other emotion that kids drive in you?
Inspiration: I came downstairs and found a signed document on my laptop. It was a request to buy shares in Q9 Elements from Max, my son aged 13. He has the confidence to put a lot of his savings into Q9 Elements. He watched ZenAlpha fail. He has weighed up the pros and cons. He is clear on the risks and is negotiating hard to make sure that he is in at the very beginning with a low valuation. Suddenly I have a very important investor that I cannot disappoint.
He has, in that one simple act, summarised why entrepreneurs need to get back up after failure and try again. We need to have a childlike confidence that it will work. We need to ignore the inner voice replaying all the past failures. And despite the crisis in confidence that we have constantly, those who know us best trust us. And it makes me realise I need to get back to where I was when we launched Nimbus. We had no idea how hard, how scary, how stressful, how motivating and ultimately how rewarding the 15 year journey would be. In one sentence we need to be:
Ignorance on fire, not knowledge on ice
Designed with “user in mind”
The AK47 assault rifle was designed with an intimate knowledge of the potential “user”. It was designed for an army made up of “average grunts who are scared, incompetent, untrained and have limited natural talent”. Increasingly the average age in conflicts is dropping with children armed with AK47s. What happens when they are scared and come under fire? They grab the rifle and hit the fire selector and pull the trigger.
Logical is not always best
The logical sequent for the fire selector is SAFE -> SEMI AUTO -> FULL AUTO. But understanding that the typical user in 99% of the cases would panic and ram the selector all the way home, onto FULL AUTO, means that they would end up emptying the whole magazine on the first unaimed burst. Within a few seconds they have an empty magazine. Not an ideal a situation when joining a firefight.
So instead they designed the AK47 with the selector that goes SAFE -> FULL AUTO -> SEMI AUTO. Not linear. Not logical. But it means SEMI AUTO is the default and FULL AUTO is a deliberate decision.
What are the real requirements?
Next they realised that the AK47 would get virtually no care and maintenance. So they made it so reliable that they have dug up AK47s that have been buried for years with woodworm that has eaten the stock…. and they still fired just fine.
Finally, they know that the average grunt couldn’t hit anything further than a couple of hundred feet away. So why spend any effort designing in accuracy. That again sounds counter intuitive. A rifle where accuracy is not on the list of requirements!! But the AK47 is a close quarters weapon. In the streets, in the jungle, across a river.
So the design brief was; foolproof & reliable. Accuracy doesn’t even make the list.
How does your user ACTUALLY use your product?
Once you have built your MVP, then you need to observe how your users are using your product. You may be surprised. Or even horrified. But that cycle of build, observe, modify when iterated rapidly is at the heart of the MVP and LeanStartup principles. It helps you zone in on your market before you have committed too much to development. And wasted effort on development has 3 dimensions. And often the cost and impact of 2 of the 3 dimensions are overlooked:
- time and money is wasted on building the wrong functionality, when that effort could be used to build the more important features
- nothing saps the morale and destroys productivity in the engineering team than pouring heart and soul into building unused features
- finally, the product is being complicated and cluttered up with functionality that is not needed, which makes it less intuitive and viral.
Product management has a huge responsibility
Product managers need to get out and meet customers and watch them using your product – ideally in person – but at least virtually. Cloud apps enable you to observe behaviour, provide you have built in the instrumentation. But product managers also need to have an open mind and not look for data to support their expectations of product use. Instead they should be curious, question, analyse and finally test ideas before they launch into specs and development.
Here is yet another example of the power of the current free marketing tools and channels in the hands of bright, innovative and passionate people. Combine this with the viral power of social media and you have a marketing reach which eclipses the marketing departments of corporates staffed with their good to average marketers.
This example is targeting Pepsico and Doritos and was made by SumOfUs who are campaigning against Pepsico’s destruction of rain forests due to the palm oil used to make Doritos.
“That sound when you bite down on Doritos? That’s the sound of rainforests being “crunched” to make way for massive palm oil plantations in Southeast Asia. Workers, and even children, are trapped in modern slavery on the plantations. Forests and peatlands are burned to the ground, driving endangered species like orangutans to extinction and polluting the Earth’s atmosphere with gigatons of greenhouse gases — all to make palm oil.
Doritos’ parent company, PepsiCo, could put a stop to the deforestation. But instead of leading the charge, PepsiCo is hanging back, issuing middling policies with gaps so big a parade of endangered pygmy elephants could fit through them.
Tell PepsiCo to be bold and help save the rainforest.”
A lovely video from GE talking about the importance of giving ideas the understanding and love that they need to grow and produce amazing things. This is a tribute to those of us who face the ridicule, laughter and disdain as we try and bring new ideas to market. It gets ugly. It gets messy. It gets expensive. And whilst many attempts fail, some become fantastic successes, which make all the heartache, anguish and sleepless nights worthwhile.
I raise a glass to all those “idea nurturers”.
LIving in Silicon Valley you get inundated with announcements by sites like Crunchbase, AngelList of another technology company that is launching a product or service which seems pointless. Perhaps that is harsh, but let’s say that the business benefits of these companies are slightly difficult to grasp. Not that it seems to stop investors!
However, 3D printing does seem to offer some real potential to change the world. The ability to create components, parts or complete products from a file is transformational. No need to wait days for a part to be delivered. Instead, send a file via email, or download it and then print in situ. And distance is not an issue; San Francisco, Stuttgart or space.
As it explained in this BBC News article, NASA has emailed a spanner to the astronauts in the space station.
Today’s technology challenge: I bought something and I hope I can get home before it is obsolete. Comedian, Robin Ince reflects on why we should spend more time appreciating what we have rather than wanting more.
Just recently Q9 wrote a suitably dour article on why the CIO hates Christmas – Bah humbug. It all hinges around BYOD and the power of the consumer as an employee. So in the cheery spirit of Christmas, I thought I’d turn my attention to the COO or Operations Director. The one who keeps the wheels turning, no matter how much grit is thrown into the innermost workings.
So why do COOs hate Christmas? It all revolves around two things – more work and fewer people – with an artificial, yet unmovable deadline set some 2000 years ago in a stable. Here are 10 reasons that the COO hates Christmas.
Reason #1: Staff illness:
With colds, flu and coughs going around, often germinated at school and brought home, the run up to Christmas is the time when staff illness is least welcome. When I was IT Director at a major UK Government Department I was stunned when I was told by a member of staff that she was planning to take the following Thursday off as sick leave to go Christmas shopping because “she hadn’t taken the full 11 days sick leave that year”.
Reason #2: Staff vacation:
Staff are forced to take remaining vacation; following on from the previous point, vacation policies often force staff to take unused days by the end of the year.
Reason #3: Xmas period shutdowns
Depending where Christmas falls anything from 3 to 10 days are lost, and often little is achieved in the week before Christmas
Reason #4: Offices closed due to weather
Winters are starting to be more extreme and whilst we don’t suffer the power cuts I remember as a child, snow often closes offices and schools, disrupts public transport and makes roads dangerous.
Reason #5: Year end sales peak
If you are of the B2B world you are trying to close deals and deliver projects in a month which is often half the length of other months. This is made worse by clients who have a December year end and hold off making purchases so that they get a last minute discount. If you are B2C then you probably have an increased volume of work which again is compressed into a shorter working month.
Reason #6: Year end discounts
B2B clients know that you have targets to hit and savvy procurement teams will wait to extract the best deal possible. They know that by hanging on to the last few days of the month they can get huge discounts, which will be given. I know one software sales guy from a major international company who sells 85% of his target in the last 2 weeks of December.
Reason #7: Xmas opening hours
Retailers are forced to stay open for longer in the run up to Christmas that means additional staff need to be recruited, trained and paid. Poorly trained staff are more likely to make mistakes, give unnecessary discounts, damage customer reputation and raise risk of credit card fraud.
Reason #8: Xmas rush delivery logistics
For those retailers who are online the pressure is put on the logistics and courier companies to deliver on time, often with a backdrop of appalling weather conditions. If they don’t, then the retailer’s reputation, fairly or unfairly, will suffer.
Post- Xmas products are returned or warranty claims are made. This is pure cost for the retailer, but if managed efficiently can improve customer satisfaction dramatically.
Reason #10: Post-Xmas morale blues
If December gives the highs, then January is the lows. Expect staff absenteeism.
Not a lot to be cheery about, I am sure you will agree. Especially, if the company is kept alive day-in day-out by the heroics of the staff. If there were more a process-led culture you might find a very different picture. Fewer mistakes to be cleared up which means fewer surprises and a calmer, more pleasant working environment.
What can you do right now?
- First review your core processes; Order to Cash, to make sure staff are up to speed and it is as easily understood and efficient as possible
- Do you need to change/uprate your credit card processing at a time when there is increased fraud?
- What about your Recruit to Retire for the seasonal / part time workers. You want them recruited and up to speed and integrated into the company culture as soon as they join.
- Equally the exit process needs to clear and fair. You can have them leaving with an armful of laptops, just because you have no track of them.
BTW All those who love the buzz of constant firefighting and the feeling that they are important have probably checked out by now.
Cloud, social, mobile and big data are enabling new entrants in virtually every industry to disrupt the incumbents. “Being Ubered” was the popular term, but based on Uber’s recent behaviour, “being Ubered” is starting to mean something entirely different!! Gartner has called it the Nexus of Forces. Forrester calls it Digital Disruption. IDC calls it the 3rd platform (the 1st being the mainframe, 2nd was client-server). Whatever you call it, it is coming to an industry near you. If you are in the music, film or print industry it has already hit you. But no industry is safe.
Company after company in industry after industry is struggling to respond to the competition from small agile startups who do not have the baggage of legacy infrastructure, organisation and supply chains. And their customers do not seem to mind giving (some of) their business to an unheard startup who can offer a great customer experience at a compelling price point. And as many startups are geared to be able to scale quickly – because the heart of their business is digital – they are able to take more and more business away from the market leaders as they prove themselves in the market.
Customer experience #fail
If the existing companies were delivering exceptional customer service then the startups would not have a chance. But they are not. The incumbents are difficult to do business with and are slow to embrace the new digital world. This is not because they don’t recognised the new demands or know what needs to be done to change. It is just that they don’t want to change. They are hooked on their current profitable model. So why go through the pain and anguish that transformative change requires? And more importantly, when is the time when they REALLY need to change. Things aren’t that bad. In fact things are still going well. So when is the tipping point? This is beautifully described by Charles Handy in his Sigmoid Curve. This is described in this blog.
Companies are being disrupted. Their vendors are being disrupted. But there is another group of far smaller companies that are also being disrupted. The partners of the vendors; in the world of tech that is the ISVs, resellers and implementation consultants. Their world is being turned upside down. They are the bridge between the customer and vendors, both of whom are trying to make sense of this new world.
Partners – a critical resource or collateral damage?
But partners are looking to their vendor’s partner programs for help. Currently the partner programs are lagging behind the change curve – for all the Sigmoid Curve reasons. But for many (most?) vendors, partners are a critical resource for revenue and delivery. So a high priority MUST be to rethink and reengineer their partner program; What sort of partners are required? How can the partner program help them be successful? How do you do all this at scale?
This was the subject of a long discussion I facilitated at the IDC Channels Summit. It was attended by the leaders of channel and partner programs from the largest IT vendors in the world. It was a very uncomfortable afternoon for some. Many had their heads in their hands at some point. Revolution, not evolution is required. You cannot evolve across an discontinuity. Evolution is not a step change. And this is what is required for most of their programs. And their partners are bleeding to death- it is just that some of them don’t realize yet. They don’t have the cash flow or reserves to do this alone. They desperately need help.
Microsoft’s 7 years of pain
Interestingly, I was on Microsoft’s WorldWide Partner Advisory Council from 2007-2011 for their cloud strategy. It was a very painful time. Transforming Microsoft’s 70,000 employees and 600,000 partners to embrace and exploit the cloud was, and still is, incredibly hard. In fact Microsoft has taken a lot of flak by the press and analysts for their mis-steps over the last 7 years. But they have kept at it and have emerged with a great set of cloud offerings and one of the best partner programs in the industry. It has taken 7 years and a pile of cash. Which is pretty scary for some vendors who are ONLY JUST starting to invest in it seriously.
Back in 2008 I was on stage at Microsoft’s World Partner Conference. My key message from the keynote was “The (cloud) train is leaving. You need to be on it”. It seems that none of the attendees of last week’s IDC Summit were in the 12,000 person audience. They know they need to get on the train, but there will need to be a lot of running to catch it. Better get going.
The late and great Douglas Adams, author of the The Ultimate Hitchhiker’s Guide said:
“The quality of any advice anybody has to offer has to be judged against the quality of life they actually lead.”
Our world seems to be too full of analysts and consultants offering advice based on theory and supposition, rather than hard won experience. It is interesting that there are several companies springing up who are tapping into the true experts and linking them up with their clients who need proven, practical advice. This is either in bite sized insights of less than 3 minutes or as a one-to-one on the phone in less than an hour.
I have flattered to have been asked to provide my insights, alongside a number of experts such as Guy Kawasaki, Joel Comm, Tom Peters. It was great fun sitting in the recording studio, but was also a good discipline to keep each insight tight and focused in under 2-3 minutes. The insights will be published in a mobile application that is launching in the new year. It is currently in stealth, so my lips are sealed.
But just recently I have also been asked to give advice, analyst-style, in one-on-ones on the phone. What is most interesting, apart from the discussions with clients, is how slick and automated the process is; from initial enquiry about the engagement through to a check hitting my mailbox. Suddenly the company can manage 1,000s of experts and connect them with clients – at scale.
Which leads me to the “longer form advice”; management consulting. It is not dead. In fact as more companies are having their industries disrupted by cloud, social, mobile and big data they are having to rethink their entire business models. And that is where a consulting firm can help give an external perspective. But clients do not want a fresh-faced MBA in an expensive suit.The classic consultants joke is that “they know a 1000 ways to make love but don’t have a girlfriend.”
Clients demand both strong business skills and an understanding of the potential of cloud, social, mobile and big data when applied to their situation. That is a rare combination – the gray hairs of a 50 year old with a 20 year old’s grasp of technology and entrepreneurial energy.
The challenge for all of us – analysts, advisors and companies – is the same. Staying relevant.
Honda have produced a fantastic video riffing off the line “the impossible made possible”. Great thought and effort went into this one, but also very clever. and it is getting results. 5.5 million views to date.
Equally clever, from a different perspective (sic) here is the group OK Go who are famous for their videos, rather than their music. But their videos drive music sales. The video below has had 12m views. Their first video on treadmills now has had 23 million views.
READ TIME: 2 mins
Tattoo decisions. We don’t make many of them in life of business. But when we do make them we need to make sure that they are right. Because any reversing the changes are very painful. Here is a very funny spoof advert for Turlingtons Tattoo Removal Cream.
In business there are relatively few tattoo decisions. These involve a key decision, and then telling lots of people about it (like that Tramp Stamp tattoo):
- company name
- strategic direction (Fortune recent article The Greatest Business Decisions of All Time) companies that made
- product name
- strategic partnership
- office location
Pretty much everything else you can reverse or change; choice of CEO, product pricing, product functionality, distribution partnerships, website design, company branding.
Interestingly in life there are even fewer tattoo decisions – except of course – actually getting a tattoo. Even getting married is probably not a tattoo decision any more. Probably the biggest tattoo decision is having children, or robbing a bank (and getting caught). Just thought of another one – getting a turtle as a pet. They live to 60 years old. Max, my son, has 2 of them and if they survive time at college with him they will outlive me.
Every other decision (that is legal) is not a tattoo decision; where to live, which school to send your kids to, which course to take, what job to accept, what hobby to take up, what car to buy.
So why do people procrastinate about make all these decisions? They are putting their life on hold whilst they try and decide. So, make a decision and then work to make the best of that decision.
Interesting side note. There is a genre of tattoos I heard about today: science tattoos. Here is an Pinterest feed of science tattoos. Quite remarkable.
READ TIME: 2 mins
HINT: Pivoting is not a business strategy, but a tactic.
HINT: Constantly pivoting is called a “death spiral”
Pivot is not a business strategy
Nowadays the trendy way to mask a failure is to successfully pivot – before the cash runs out – and then become successful. But for every one of these successful pivots there are hundreds, if not thousands, of technology companies that have crashed and burned. Sadly, they ran out of funding before they discovered their perfect market. Or they are limping along barely breaking even each month.
Words like “pivot” and the related “iterate” have been used in and around Silicon Valley for several years, generally to describe “failing gracefully”.
But their use has picked up significantly in recently amid the broader public’s fascination with the entrepreneurs behind high-profile start-ups, some of whom were able to get funding from investors despite significant changes in their original business plans.
Ben Horowitz of venture-capital firm Andreessen Horowitz used the word “pivot” three times in a nearly 800-word blog post to discuss the firm’s investments in businesses such as Burbn.
Never heard of Burbn? I am not surprised. Burbn attempted to put a new spin on the idea of virtually checking in at various locations via smartphones, then broadcasting that visit to one’s social network. It enabled people to leave messages via their phones that could be retrieved by others visiting the same location. The idea evolved, and turned into a mobile app that would allow people to take photos, alter them visually and share them. That app was called Instagram which was sold to Facebook for $1 billion.
“Pivot to me is not a four-letter word,” says Tony Conrad, a partner in the early-stage venture capital firm True Ventures. “It represents some of the best methodology that the Valley has invented. Starting something, determining it’s not working, and then leveraging aspects of [that] technology is extremely powerful.”
Investors say the founders who are not afraid to pivot are generally more experienced—and less fearful of failure—than past generations of tech entrepreneurs. The founders who change solutions and markets between one and three times raise more money than those who don’t, according to Startup Genome Compass, which tracks more than 13,000 Internet start-ups. In fact, they raised roughly 2½ times more capital than founders who changed solutions and markets either four or more times or not at all.
However revolutionary this seems, there is a fundamental point.
No matter how many pivots you make and how understanding your investors – eventually you need to find a market that works. That is why we wrote IMPACT (download free abridged copy). But to give you all hope, inspiration and amusement I have listed a few of the most successful pivots.
Then: It started as ThePoint.com, a site launched in November 2007 that lets you start a campaign asking people to give money or do something as a group – but only once a “tipping-point” of people agree to participate.
Now: Groupon is the group-buying site that helps people save money all over the country through targeted offers.
Then: The founders had built a location-based service called Burbn, most comparable to Foursquare. You could check into locations, earn points for hanging out with their friends, and share pictures inside of the app.
Now: Instagram is a hugely popular app for adding artsy filters to your photos and sharing them over Facebook and Twitter.
Exit: Sold to Facebook for $1billion
Then: It was Game Neverending, a massively multiplayer online roleplaying game that ran from 2002-2004.
Now: Flickr is one of the go-to sites for sharing photos online, popular among amateur and professional photographers.
Exit: Sold to Yahoo in 2007 for $40 million.
Then: It was Facemash, a site comparable to HotOrNot.com, putting two pictures of people next to each other and asking the user to identify which one was “hotter.”
Now: It’s Facebook. If you don’t have an account and use it actively, you’ve at least heard of it.
Then: It was Odeo, a service that revolved around personal podcasting and sharing audio content.
Now: It’s Twitter. People use it to share thoughts and updates in 140-character bursts.
Then: It started as Confinity, a cryptography company designed for exchanging money over Palm Pilots. It didn’t work well, but they did identify the lucrative market space of enabling people to take credit card payments.
Now: PayPal is the brand-name way to pay for items online.
Exit: Acquired by eBay in 2002 for $1.5 billion.
Then: Started as supply-chain management optimization for high-tech manufacturers.
Now: Shifted to dynamic ad price optimization for online media companies.
Exit: They were bought by Microsoft for undisclosed price.
Then: It was a video online dating site
Now: YouTube is the go-to location for internet video.
Exit: It was acquired by Google for $1.65 billion in stock.
Then: Their first product was Glitch, a Flash-based massively multiplayer online game.
Now: Tiny Speck launched Slack in August 2013 and they have just raised an additional $120m taking the total to $180m.
IMAGE: Pivot Digital Strategies