Distinct or … Extinct

Tom Peters Seminar2000 LESSONS IN LEADERSHIP

Detroit

29 September 2000

Summer 2000 …

KOA wires up!

N.W.O./Auto Mirror per Gentex: Portal for Wireless, Internet, Navigation, Etc.

Cell phones, Voice mail, email, Internet access

Mike Charles. Stanford history prof.

Whirlpool fridge.

Out of 2% milk.

Tap keypad on door. Webvan delivers in hours.

Next, he

sends his washer an email …

Source: Business Week (09.00)

Pentium III 800MHz: $42,893.00/# Hermes Scarf: $1,964.29

Saving Private Ryan on DVD: $874.75

Mercedes-Benz: $18.98

Hot-rolled steel: $0.19

Source: Fortune (3.20.00)

“The period 2000-2002 will bring the single greatest change in worldwide economic and business conditions

since we came down from the trees.”

David Schneider & Grady Means,

MetaCapitalism

“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 (08.00)

“We are in a

brawl with no rules.”

Paul Allaire

S.A.V.

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!)

“It used to be that the big ate the small.

Now the fast eat the slow.”

Geoff Yang, IVP/ (Institutional Venture Partners)

Progressive “We don’t sell insurance anymore.

We sell speed.”

– Peter Lewis Digital cameras, wireless Net links, etc.:

SOME CLAIMS PAID WITHIN 20 MINUTES!

Source: Business Week (09.00)

“Strategy meetings held once or twice a year” to

“Strategy meetings needed several times a week”

Source: New York Times on Meg Whitman/eBay

John Roth’s “Rules” [Nortel] 1. Our strategies must be tied to

leading-edge customers on the attack.

2. Time cannot be sacrificed

for better quality, lower cost, or even better decisions.

3.

It doesn’t matter whether you develop or acquire leading technology. Our job is to

provide the technology and products our customers need.

4. Success is achieved by

leading change, not waiting for it.

5. We are

paranoid about our leadership

– willing to cannibalize our own products to maintain our edge.

Source: Abridged from The Wall Street Journal (07.25.00)

No Wiggle Room!

“Incrementalism is innovation’s

worst

enemy.”

Nicholas Negroponte

Tom Peters Seminar2000 Brand Everything : Distinct or Extinct!

Structure

Part I: Brand Inside Part II: Brand Outside Part III: Brand Leadership

Part I: Brand Inside

Part II: Brand Outside Part III: Brand Leadership

Forces @ Work I

The Destruction Imperative!

Forget > Learn

“The problem is never how to get new, innovative thoughts into your mind,

but how to get old ones out.”

Dee Hock

“It is generally much easier to

kill an organization

than change it substantially.”

Kevin Kelly, Out of Control

“When asked to name just one big merger that had lived up to expectations, Leon Cooperman, former cochairman of Goldman Sachs’ Investment Policy Committee, answered:

I’m sure there are success stories out there, but at this moment I draw a blank.”

Mark Sirower, The Synergy Trap

“Acquisitions are about buying market share.

Our challenge is to create markets.

There is a big difference.” Peter Job, CEO, Reuters

“Our ideal acquisition is a small startup that has a great technology product on the drawing board that is going to come out in six to twelve months.

We buy the engineers and the next generation product. …”

John Chambers, Cisco

Pentium III 800MHz: $42,893.00/#

Cisco Engineer: $19,000.00

Hermes Scarf: $1,964.29

Saving Private Ryan on DVD: $874.75

Mercedes-Benz: $18.98

Hot-rolled steel: $0.19

Source: Fortune (3.20.00)

The [New] G

e

Way

DYB.com

The Gales of Creative Destruction +29M = -44M + 73M +4M = +4M - 0M

Paradox Redux Atlanta: +113,600 = #1 metro area Layoffs [major]: BellSouth, Lockheed, Coca-Cola

Brand Inside Brand Org:

Lean, Linked, Electronic & Malleable

Headline: “Bank of America to Cut … 10,000 Jobs” “Middle-level and senior

managers

are expected to be the principal targets of the job cutbacks.” Source: The New York Times (07.29.2000)

Qwest Announces 11,000 Layoffs “The cuts will be

concentrated among management employees.”

Source: AOL 09.07.2000

White Collar Revolution!

108 X 5

vs.

8 X 1*

* 540 vs. 8

The Pincer 5 “Destructive” entrepreneurs/ Global Competition “White Collar Robots” THE INTERNET!

[E.g.: GM + Ford + DaimlerChrysler] Global Outsourcing [E.g.: India, Mexico] Speed!!

“A bureaucrat is an expensive microchip.”

Dan Sullivan, consultant and executive coach

Automation+ 75% of what we do: 40 “expert” decision rules!

“Assetless

Company”

John Bryan, CEO, on selling all Sara Lee’s manufacturing

“Don’t own nothin’ if you can help it. If you can, rent your shoes.” F.G.

Cisco, Dell = Brand-owning companies who sell Customer Satisfaction Source: David Schneider & Grady Means,

MetaCapitalism

RR on “Assetless” [J.B.] Sara Lee

“The most profitable businesses in the future will act as knowledge brokers,

linking insights into what’s available with insights into the customer’s individual needs and preferences.”

Cemex and FDX!

Pervasive “Risk Markets” “For a dollar a month, an Ohio insurance company will rent you a GPS receiver to install in your car. As part of your policy, it signals how often, when, and which highways you drive and into which neighborhoods you go. The premium you pay reflects your actual driving risk.” Stan Davis & Christopher Meyer,

futureWEALTH

Advance Paradigm Data on

165,000,000

prescriptions per year; docs and insurers have access to records Reduces med errors; saves $2.88 per scrip [prescribing errors]; docs save $14,000 per year in review time Rev in ’99: $2B; $477M in ’98 Source: Business Week (09.00)

Brand Inside Brand Work:

The Professional Service Firm Model & The WOW Project

So what will be the

Basic Building

Block of the

New Org?

Answer: PSF!

[Professional Service Firm]

Department Head to …

Managing Partner, HR [IS, etc.] Inc.

New Orleans April 2000: NAPM

You

are the …

Rock Stars of the B2B Age!

Chicago November 1999: HRMAC

“support function” / “cost center” / “bureaucratic drag”

or …

Are you “Rock Stars of the Age of Talent”

Every job done in W.C.W. is also done “outside” … for profit!

Credo

“WORK WORTH PAYING FOR”

C.I.O.

to C.E.F.R.N.S.*

* C hief E vangelist F or R eally N eat S tuff

The Raw Material …

The WOW Project!

“Reward excellent failures. Punish mediocre successes.”

Phil Daniels, Sydney exec

Measures

–

WOW!

–

Beauty!

–

Raving Fans!

–

Impact!

T.T.D.s

The next slide is the first of many “T.T.D.” activities. I.e.: Things To Do, shorthand forms of training exercises I use.

Also: Many of these T.T.D. slides, as well as most of the “Stuff That Matters” section, have accompanying Notes. (Use Normal View to access.)

Tom Peters

T.T.D.: Now!

–

List all projects

–

Carefully describe a “WOW Outcome” for you and the Client

–

Score (!) all projects on WOW, Beauty, Impact, Raving Fan-hood

–

Pick one project with a high combined score

–

Draft a one-page New Description that emphasizes WOW, Beauty, etc.

–

Circulate and edit … for three days

–

Reduce to 5 bullet points

Brand Inside Brand You:

Distinct … or Extinct

2010 “Demographics”:

By 2010, full-time workers will be in the minority

Source: MIT study (28August2000)

DISTINCT … OR EXTINCT!

“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

Minimum New Work SurvivalSkillsKit2000

Mastery

Rolodex Obsession

Finishing Skills

Entrepreneurial Instinct

CEO/Leader/Businessperson

Mistress of Improv

Sense of Humor

Intense Appetite for Technology

Groveling Before the Young

Embracing “Marketing”

Passion for Renewal

Minimum New Work SurvivalSkillsKit2000 Sense of Humor = N0.1 Mastery

Rolodex Obsession

Finishing Skills

Entrepreneurial Instinct

CEO/Leader/Businessperson

Mistress of Improv

Intense Appetite for Technology

Groveling Before the Young

Embracing “Marketing”

Passion for Renewal

T.T.D./Assignment Construct a 1/8-page or 1/4-page ad for Brand You … for the

Yellow Pages

R.D.A.

Rate: 15%?, 25%?

Therefore: Formal “Investment Strategy”/

R.I.P.

T.T.D./Your R.I.P.

IS IT … FORMAL? IS IT ... WOW!?

“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

T.T.D./R.I.P.

Use by yourself.

Use with your mates.

Use [quantitatively?] as a measure of departmental/ P.S.F. renewal.

Use in formal eval process.

America[ns] The … Beautiful Re-inventors Ben F.

Ralph W.E.

Dale C.

N.V.P. Werner E./est “Tony R.”/“Coals Dude” Stephen

Seminar Y2K/Brand Inside

Message: Distinct … or Extinct!

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

Some people enjoy the corporate life.

Then again, some people enjoy nipple clamps.

Source: Ad tag line, FreeAgent.com

Bill Parcells’ World/ Brand You World!

BLAME NOBODY!

EXPECT NOTHING!

DO SOMETHING!

NY Post (9/99)

Brand Inside Brand Talent:

The Great War for Talent

The Case

“When land was the scarce resource, nations battled over it. The same is happening now for talented people.” Stan Davis & Christopher Meyer,

futureWEALTH

“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

The Talent Ten

Obsession! Greatness! Performance!

Pay!

Youth!

Diversity!

Women!

Weird!

Opportunity!

Leading Genius!

There is no “talent shortage” …

if

… you are a

GPTW*

*Great Place To Work

1. Obsession P.O.T.* = All Consuming *Pursuit of Talent

From “1, 2 or 3” [JW] to …

“Best talent in each industry segment to build best proprietary intangibles” [EM]

Source: Ed Michaels, War for Talent (05.17.00)

2. Greatness Only The Best!

Home Depot: 7 new growth initiatives ($20B to $100B in 5-7 years) Arthur Blank:

BEST PERSON IN THE WORLD TO HEAD EACH INITIATIVE

E.g.: COO of IKEA to head international expansion Ed Michaels, War for Talent (05.17.00)

3. Performance Up or out!

“We believe companies can increase their market cap 50 percent in 3 years. Steve Macadam at Georgia Pacific

changed 20 of his 40 box plant managers to put more talented, higher paid managers in charge.

He increased profitability from $25 million to $80 million in 2 years.” Ed Michaels, War for Talent (05.17.00)

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!

“This is the Age of Ageism: The real innovator’s dilemma isn’t ‘disruptive technologies;’ it’s the relentless rise of the quasi adolescents who wield them.” Michael Schrage

“A good plant engineer in a paper mill may create $100K to $300K in value per year. An outstanding software product developer may create a product worth $1M to $300M.

Talented people are less likely to wait their turn. We used to view young people as trainees; now they are authorities.

Arguably this is the first time the older generation can – and must – leverage the younger generation very early in their careers.” Ed Michaels, War for Talent (05.17.00)

“Talent” and a

$2T

enterprise??????

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 mix-and-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

7. Women Born to Lead!

Women and new economy management …

The New Economy … Shout goodbye to “command and control”!

Shout goodbye to hierarchy!

Shout goodbye to “knowing one’s place”!

Women’s Stuff = New Economy Match Improv skills Relationship-centric Less “rank consciousness” Self determined Trust sensitive Intuitive Natural “empowerment freaks” [less threatened by strong people] Intrinsic [motivation] > Extrinsic

“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

“Boys are trained in a way that will make them irrelevant.”

Phil Slater

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)

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

Axiom: Never hire anyone without an aberration in their background.

(Find the One Ton Cookie Man!)

9. Opportunity Make It an Adventure!

“H.R.” to “H.E.D.” ???

H uman E nablement D epartment

“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”

“The challenge for IBM, AT&T and other mainstream companies is to re-instill a

sense of adventure

in recruits.” Burke Stinson, AT&T

10. Leading Genius It’s All Theater All the Time!

The Creative Arts: Acquisition & Development of Talent = All Ballet Symphony Theater Sports Combat

Employee retention and satisfaction: Overwhelmingly, based on their

immediate manager!

Source: Marcus Buckingham & Curt Coffman,

First, Break All the Rules: What the World’s Greatest Managers Do Differently

44 Players = 44 Projects = 44 different success measures = 44 different styles (of you) One [if lucky] “1 in 10 years” [Scout: Great career = 1 sleeper find]

Exec: Can we really use individualized

evaluations for everyone?

TP:

We do routinely for “Top 25,” so why not? Few supervisors have more than 10 folks directly reporting to them. True, there’d have to be some bounds. I guess. But why not a $60,000 housekeeper who sets the character of a full floor of a $150,000,000 hotel property?

Insights from 80,000 managers: “People don’t change much.

“Don’t waste time trying to put in what was left out.

“Try to draw out what was left in.

“That is hard enough.” Source: Marcus Buckingham & Curt Coffman,

First, Break All the Rules: What the World’s Greatest Managers Do Differently

Mantra2000

Talent = Brand

Brand Inside Brand Action:

Getting Started … a Personal Perspective

Topic:

Boss-free

Implementation of

STM

/Stuff That MATTERS!

“

This is all I ‘know’ in the world!”

Tom Peters

I. THE IDEA

“4Fs”:

F

ind a

F

ellow

F

reak

F

araway

World’s Biggest Waste …

Selling “Up”

Axiom: Never waste compelling evidence on people who don’t agree with you, especially bosses.

The principal purpose of such evidence is to inflame people who already agree with you – to the point that they will take hard action.

Heart of the Matter

F2F!*

*Freak to Freak … or K2K [Kook to Kook]

Create a Personal

University of Weird!*

*AP to TP: “Make your own McKinsey.”

II. THE NUGGET Do

Something.

Do

Anything.

Get

Going.

Now.

Opportunity ALWAYS Knocks

VFCJ*

“Strategy”

*Volunteer For Crappy Jobs

Is It … “The Oh-Shit-I-Wish-It-Were Over Memorial Day picnic” or

“The First Annual S eriously K ewl C elebration of Our Incredible Staff”

Is It … Wrestle the damn Safety Manual into line with the ridiculous new OSHA Regs?

Or … A stealth opportunity to address the War

for Talent

via …

a thoroughgoing review of how safety and environmental issues contribute to making this a Great Place to Work?

Is It … Fix these bloody customer problems that have cropped up with the new 2783B?

Or … A chance to work with a hotshot, young division GM on …

using the Internet/Internet Speed to revisit the entire process of how we get customer input – before and during the fact – into the heart of the Product Design Process?

Reframers’ Rules: Rule 1:

Never accept an assignment as given! (Please.)

Rule 2: You’re never so powerful as when you are “powerless”!

Rule 3: Every “small” project contains the entire enterprise DNA!

III. THE TOOL Prototyping

Mania!

Culture of Prototyping “Effective prototyping may be

the most valuable core competence

an innovative organization can hope to have.” Michael Schrage

“Success is the ability to go from failure to failure without losing your enthusiasm.”

Winston Churchill (as quoted by John Peterman)

IV. THE SOFT STUFF Show Up!

Connect!

Infect!

Message:

It’s Community Organizing, stupid!

See: Saul Alinsky’s

Rules for Radicals

V. BOTTOM LINE The Enemy!

Epitaph from Hell … Joe T. Jones 1942 - 2000 HE WOULDA DONE SOME REALLY COOL STUFF BUT … HIS BOSS WOULDN’T LET HIM!

Characteristics of the “Also Rans” “minimize risk” “respect the chain of command” “support the boss” “make budget” Source:

Fortune on “most admired

global corporations” (10/26/98)

Consider: Are any of these four attributes characteristic of those who “made the history books”?

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

Reprise: Brand Inside

The White Collar Revolution & The Web

[Destruction Rules!]

PSF as Building Block

[Work Worth Paying For]

Work Worth Paying For = WOW Projects!

Brand You

[Everybody!]

The Great War for Talent!

Boss-free Implementation of STM! [F2F]

• • • • • • • • •

N.W.O.: Was-Is Pine-paneled Office Address: 1 Big Man Plaza

•

Secretary

• •

Suit Formal Rank conscious Pretense (“Failures are for fools.”) I love “Yes men”

• • • •

Self-contained

• •

Seat 9B, AA233 Address: [email protected]

Typing: 60 WPM Casual M-F Approachable We are a HOT Team Screwing up is as normal as breathing I love Misfits!

I love partners

Part I: Brand Inside

Part II: Brand Outside

Part III: Brand Leadership

Forces @ Work II

The Commodity Trap

Quality Not Enough!

“Quality as defined by few defects is becoming the price of entry for automotive marketers rather than a competitive advantage.” J.D. Power

Quality Not Enough!

“While everything may be better,

it is also increasingly the same.”

Paul Goldberger on retail, “The Sameness of Things,” The New York Times

“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, working in

similar

jobs, coming up with

similar

ideas, producing

similar

things, with

similar

prices and

similar

quality.” Kjell Nordstrom and Jonas Ridderstrale,

Funky Business

The “10X/10X Phenomenon”

10 Times Better/ 10 Times Less Different

“When we did it ‘right’ it was still pretty ordinary.” Barry Gibbons on

“Nightmare No. 1”

Funky Business

: “To succeed we must stop being so goddamn normal. In a winner-takes-all world,

normal = nothing .”

Brand Outside Strategy 1 :

Lead

the Customer!

“If you worship at the throne of the voice of the customer, you’ll get only

incremental advances.”

Joseph Morone, President, Bentley College

“Our strategies must be tied to leading edge customers on the attack.

If we focus on the defensive customers, we will also become defensive.” John Roth, CEO, Nortel

Lucent Stumbles!

Cause(s):

(1) Listening to BIGGEST, SLUGGISH customers.

(2) Failing to exploit the Web internally or externally Source: Business Week (08.07.00)

Message … Biggest is

not

always [often?] most beautiful!

F2F Rules: How’s your “freaks” portfolio?

Brand Outside Strategy

2

:

Use E-Commerce to

Re-invent Everything!

OVERVIEW

Dateline … Johannesburg, 1221AM EDT, 30 August 2000

www.cyveillance.com

08.30.2000/1221AM:

2,461,940,629

www.cyveillance.com

09.29.2000/0553AM:

2,683,461,885

30 days, 5 hours, 32 minutes …

+221,521,256

Tomorrow Today: Cisco!

90%

of $20B

(=$50M/day) 75%

mfg. outsourced;

50%

of orders routed to supplier who ships direct Gross margin: 65%; Net margin: 28% Savings in service and support from

customer self-management: $550M

Oracle: Service Call Center

$300.00

per transaction to

$1.50

Savings:

$550,000,000

Source: Ralph Seferian, Oracle [part of O’s $1B saving – on a rev. base of $9B; $1B additional this year]

Enron:

$400B in annual

on-line trading transactions. [50% total bus.] Much stimulated by the Web per se.

Schwab:

$25B per week

in asset transactions [80% of trades] [Transition to e.Schwab: Rev. fell, then quickly doubled]

W.W. Grainger*

2X

phone/fax

*$220B “MRO” market (per Business 2.0/02-00)

COMMUNITY SERVICES!/ CUSTOMER CONTROL!

Tomorrow Today: Cisco! 90% of $20B; save $550M

C.Sat e >> C.Sat H Customer Engineer Chat Rooms/Collaborative Design ($1B “free” consulting) (45,000 customer problems a week solved via customer collaboration)

Cisco’s Secret

Trust

(Openness to partners!!!!!)

B2C Success “Genuine brand strength”

“Build community”

Source: Geoffrey Moore

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!

Anne Busquet/ American Express Not : “Age of the Internet” Is:

“Age of Customer Control”

“The moral is that in an imperfect world of customer service,

most customers prefer to cut to the chase and help themselves.”

Adrian Slywotzky & David Morrison, Mercer Consulting

SWA

Simple!!!!!!!!!!!!

(customers call because the process is so easy they can’t believe they’re done) 30% of revenues directly from site (vs. 6% for others) Source: Business Week (09.00)

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 Nordstrom and Jonas Ridderstrale,

Funky Business

“In the network economy, the Website becomes the company’s primary interface to the customer. The user interface becomes the marketing materials, store front, store interior, sales staff and post sales support all rolled into one.” Jakob Nielsen,

Designing Web Usability

Shop in your Underwear

Source: SM’d logo for www.ae.com

ae = American Eagle Outfitters

RADICAL STRATEGIES REQUIRED

“Where does the Internet rank in priority?

It’s No. 1, 2, 3, and 4.”

Jack Welch

“One cannot be tentative about this.

Excuses like ‘channel conflict’ or ‘marketing and sales aren’t ready’ cannot be allowed. Delay and you risk being cut out of your own market, perhaps not by traditional competitors but by companies you never heard of 24 months ago.” Jack Welch [07.00/Forbes.com]

ACT NOW, ACT FAST, KEEP ACTING

“It’s better to be first with less than last with more. Success on the Web isn’t just about time to market, it’s also about

‘time to learning.’ ”

Jeff Levy, eHatchery

SUMMARY I: REINVENT EVERYTHING

WebWorld = Everything

Web

as a way to run your business’ innards

Web

as connector for your entire supply-demand chain

Web

as “spider’s web” which re-conceives the industry

Web Web

/B2B as ultimate wake-up call to “commodity producers” as the scourge of slack, inefficiency, sloth, bureaucracy, poor customer data

Web Web

as an Encompassing Way of Life = 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

“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. And Joe Employee, business partners and customers don’t have to be in the office. They can log on from their own cell phone, Palm Pilot, pager or home office system.” Red Herring (09.2000)

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, bottlenecked communication, six-layer organization.

SUMMARY II: A DREAMER’S MEDIUM!

“There is 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 imagined before!

“Banking is necessary.

Banks are not.”

Dick Kovacevich, Norwest/ Wells

Brand Outside Strategy

3

:

Fighting Back via

Systems Integration!

THE CASE

B2B 1999 – 2004:

50X

2004: $7.4

T

Source: GartnerGroup (per Reuters 1-26-00)

GM/Ford/DaimlerChrysler (02-27)

Covisint $240B (+$500B)

Solectron, IBM, Nortel, Matsushita, Seagate, Etc.

E2Open.com

$700

B

Goal?

Drive profits to zero!*

*Remember AMR and “dynamic pricing.”

“Net Nips Real Estate Sales Fees”

Headline, p.1B, USAToday 07.05.00* *Homebytes.com, eHomes.com, YourHomeDirect.com, etc.

Message:

“BOX” SELLERS LOSE!

THE RESPONSE

Message:

Racing up the V.A. Ladder. Doing More & More … & More & More & More … for/with the Customer and the Supply-Demand Chain!

09.11.2000: HP bids

$18,000,000,000

for PricewaterhouseCoopers Consulting bus!

(31,000 bods)

“These days, building the best server isn’t enough. That’s the price of entry.” Ann Livermore, Hewlett Packard

“We want to be the air traffic controllers of electrons.”

Bob Nardelli, GE Power Systems

Defense-Offense: Systems Integration/HVA Delphi, Dana United Technologies, Corning, GE, Sun, Carpet One, Bud …

[Anybody in their right mind!]

E.g. …

UTC/Otis + Carrier:

boxes to “integrated building systems”

Brand Outside Strategy 4 :

Design

Matters!

And Tomorrow … “Fifteen years ago companies competed on price. Now it’s quality.

Tomorrow it’s design.”

Robert Hayes

All Equal Except … “At Sony we assume that all products of our competitors have basically the same technology, price, performance and features.

Design is the only thing that differentiates one product from another in the marketplace.”

Norio Ohga

Drop-dead Charm!

“The new Beetle fails at most categories. The only thing it doesn’t fail in is

drop dead charm.”

Jerry Hirshberg, Nissan Design International

“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 meaning of design.

Design is the fundamental soul

of a man made creation.” Steve Jobs

Message:

“Great Cool Stuff” Matters. Great & Cool Trumps Not-So-Great & Ho Hum!

DESIGN

transforms the perception of what’s possible.

E.g.: Plate-glass windows. Apple II.

Message Beetle & iMac:

“Great Stuff” Takes Guts!!

The I.D. [International Design] Forty* Airstream … Alfred A. Knopf … Apple Computer …

Amazon.com

…

Bloomberg Disney

… … Caterpillar …

FedEx CNN

… … Gillette … IBM …

Martha Stewart

… New Balance …

Nickelodeon

… Patagonia …

York Yankees The New

… 3M … Etc. * List No. 1, 1999

Unconventional [Design] Messages

Not

about ... “Lumpy Objects”!

Not about ... $79,000 objects

TARGET … “the champion of America’s new design democracy” (Time)

Message: “Services” are Not Intangible!

You “give off” hundreds of design cues … daily!

YOU

ARE

A DESIGNER!

T.T.D./“Beauty Contest!” 1. Pick one form/ document: invoice, airbill, sick leave policy, returns claim form.

2. Rate it on a 1 to 10 scale (1 = Awful; 10 = Scintillating) on three dimensions:

Beauty, Grace, Clarity

.

3. Repeat … every 15 days.

T.T.D./Design “Awareness”!

STEP No. 1:

NOTEBOOK!

[Start recording the awesome and the awful.]

T.T.D./Design “Awareness”!

STEP No. 1:

NOTEBOOK!

[Start recording the awesome and the awful.]

Design “is” … WHAT & WHY I LOVE.

LOVE.

I

LOVE

my ZYLISS Garlic Peeler!

Design is

never

neutral.

Design “is” … WHY I GET MAD.

MAD.

“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

Wanted: Dead

[preferably]

or Alive: THE DESIGNER OF MY RADIO SHACK PHONE. Major Reward!

Users …

STOP BLAMING YOURSELVES!

(Don Norman)

Hypothesis:

DESIGN

is the principal difference between love and hate.

Web =

PURE DESIGN MEDIUM

Brand Outside Strategy 5 :

It’s the

Experience!

“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

“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

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

To 1940: Cake from flour, sugar (extraction economy): $1.00

1955: Cake from Cake mix (goods economy): $2.00

1970: Bakery-made cake (service economy): $10.00

1985+: Party @ Chuck E. Cheese (

experience

economy)

$100.00

LAN Installation Co.

to Geek Squad (2% to 30%/Minn.)

Step #1

WHAT’S THE

[your]

PLOT?

“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

Plot Williams Sonoma = 7 [was 10] Crate & Barrel = 8 Sharper Image = 9+ Smith & Hawken = 8+ Garnet Hill = 9 L.L. Bean = 5 [was 9+] Land’s End = 7+

Colonial Williamsburg = ?

Brand Outside Strategy 6 :

Women

Rule!

?????????

Home Furnishings … 94% Vacations … 92% Houses … 91% Bank Account … 89% Health Care … 75% Etc.

48% working wives > 50% 80% checks 61% bills 53% stock (mutual fund boom) 43% > $500K 95% financial decisions/ 29% single handed

Women … 50+%

(!!!)

of Web users; 6 of 10 new users; 83%

of wired women are primary decision makers for family healthcare, finances, education.

Source: Business Week; Jupiter Communications

$4.8T > Japan 9/27.5/3.6T > Germany

New golfers … 37% Basketball … 13.5M

1 in 27 (’70) … 1 in 3 (’96)

1874?

1874 … Jock Strap 1977 … Jogbra 1977 ... 25K 1996 … 42 M

Yeowl!

1970 … 1%

2002 …

50%

OPPORTUNITY NO. 1!*

[* No shit!]

Carol Gilligan/ In a Different Voice Men: Get away from authority, family Women: Connect Men: Self-oriented Women: Other-oriented Men: Rights Women: Responsibilities

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!)]

Women and Healthcare Women are … more dissatisfied, frustrated by the way they are treated

and spoken down to

by physicians, seek more information, are more pressed for time … and make 75% of health care decisions and control 2/3 of health care $$$$ [and constitute 2/3 of health care employees].

Source: Patricia Braus, Marketing Healthcare to Women

Women and Financial Advisors Women want listened to, … a plan, to be to be taken seriously , to read about it, to think about it.

Women do not want … an in-your-face sales pitch Source: Kathleen Boyle, Wheat Boyle Butcher Singer

“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)

Marketing to Women:

Help Them Save Time!

80% … work 86% … cook 58% … run errands with kids 38% … take child to school 21% … go to the gym 21% … take outside classes

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

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

Weight Watchers International “Model” “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

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. is being serviced properly.

Trust

that her car

Respect

intelligence and ability.” for her

EVEolution

Not!!

“Year of the Woman”

Enterprise Reinvention!

Recruiting Hiring/Rewarding/ Promoting Structure Processes Measurement Strategy Culture Vision Leadership

THE BRAND ITSELF!

“What kind of car does Mommy want?”

“I didn’t know [company] were giving company cars to secretaries.” Source: UK financial services CEO, 12/99

Psssst! Wanna

see my “porn” collection?

27 March 2000: email to TP from Shelley Rae Norbeck “I make 1/3 rd 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

THIS JUST MIGHT BE THE BIGGEST “THING” IN THIS SEMINAR.

[PLEASE: THINK ABOUT IT!]

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 are marketing to women entrepreneurs because it is a huge opportunity.” Cherie Piebes

Speaking of Enormous [Missed] [Huge] Opportunities ...

Subject: Marketers & Stupidity

It’s 18-44, stupid!

Subject: Marketers & Stupidity

Or is it: 18-44 is stupid, stupid!

2000-2010 Stats

18-44: -1% 55+:

+21%

(55-64: +47%)

74/55 “At each stage of their lives, the needs and desires of the baby boomers have become the dominant concerns of American business and popular culture. If you can anticipate the movement of the baby-boom generation’s life-span migration, you can see the future.” Ken Dychtwald, Age Wave

Aging/“Elderly”

$$$$$$$$$$$$ “I’m in charge!”

Priorities: Aging/“Elderly” Experiences … Convenience … Comfort … Access …

Respect!

Brand Outside Strategy 7 :

Embracing an

Age of Self-Determination

“We are in a

brawl with no rules.”

Paul Allaire

SO … WE’VE GOTTA MAKE OUR OWN RULES!

Emerson’s Back

… with a vengeance! It’s scary! It’s cool!

The Individual

DISTINCT … OR EXTINCT!

“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

“You are the storyteller of your own life, and you can create your own legend or not.” Isabel Allende

The Work

Enter …

The WOW Project!*

*The Project50

Ann Richards’ Dogma

Show up! Know your story!

Put yourself at risk every day!

The Organization: Seller’s [Talent] Market

“A good plant engineer in a paper mill may create $100K to $300K in value per year. An outstanding software product developer may create a product worth $1M to $300M.

Talented people are less likely to wait their turn. We used to view young people as trainees; now they are authorities. Arguably this is the first time the older generation can – and must – leverage the younger generation very early in their careers”

Ed Michaels, War for Talent (05.17.00)

The Market: Fighting Sameness with Distinction

“The ‘surplus society’ has a surplus of

similar

companies, employing

similar

people, with

similar

educational backgrounds, coming up with

similar

ideas, producing

similar similar

prices and things, with

similar

quality.” Kjell Nordstrom and Jonas Ridderstrale,

Funky Business

Web World: POWER TO THE PEOPLE

Anne Busquet/ American Express Not : “Age of the Internet” Is: “Age of Customer Control”

Women Get Respect … and Take Charge

$4.8T > Japan 9/27.5/3.6T > Germany

The Elderly Get Respect … and Take Charge

Aging/“Elderly”

2X growth rate $$$$$$$$$$$$

“I’m in charge!”

Good source: Ken Dychtwald,

Age Wave

Our Biggest Industry: The Patient Gets Respect … and Takes Charge

“Partner for Good Health” vs.

“Savior for the Sick” Source: NPR/VPR 08.15.00

“Online Medical Records Seen Empowering Patients”

Source: Headline, Boston Globe, 07.31.2000, re 1K docs and 700K patients @ CareGroup

1965 : “ ‘Doctor’ will see you now. ‘Doctor’ will take care of you.” YES, NURSE. ME GOOD PUPPY DOG.

1995 : “HMO will take care of you.” BULLSHIT.

2005: “I will take care of me.

expert help.” I’d like your

The Poor Get Respect

Grameen Bank/Bangladesh “It’s not people who aren’t credit-

worthy. It’s banks that aren’t people worthy.”

$2.3B to 2.3M [typical 1 st loan:

$15.

] 98% recovery rate

[94% to women!]

1/3 rd out of poverty; 1/3 rd up to non poverty threshold Muhammad Yunus, Banker to the Poor

“The Grameen loan is not simply cash. It becomes a kind of ticket to self-discovery and self exploration.” Muhammad Yunus

Etc.

Self-Determination Redux Micropower (fuel cells) … Microgrids … “Virtual Utilities” Source: The Economist (08.2000)

Sooooo … Is your strategy centered around customer-client empowerment & self determination?

Hint: This means letting go of traditional sources of power!

Brand Outside Strategy 8 & Summary:

BRAND

POWER!

Brand It!

Now, More Than Ever!

“The increasing difficulty in differentiating between products and the speed with which competitors take up innovations will assist in the

rise and rise of the brand.”

Gillian Law and Nick Grant, Management [New Zealand]

Scott Bedbury/ Nike, Starbucks “A Great Brand taps into emotions. Emotions drive most, if not all, of our decisions. A brand reaches out with a powerful connecting experience. It’s an

emotional connecting point

that transcends the product.

“A Great Brand is a story that’s never completely told. A brand is a metaphorical story that

connects with something very deep - a fundamental appreciation of mythology

.

Stories create the emotional context people need to locate themselves in a larger experience.”

“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 to how we work with others.

Companies will thrive on the basis of their stories and myths.

Companies will need to understand that their products are less important than their stories.” Rolf Jensen, Copenhagen Institute for Future Studies

“In the funky village, real competition no longer revolves around marketshare. We are competing for attention –

mindshare and heartshare.”

Kjell Nordstrom and Jonas Ridderstrale,

Funky Business

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

Brand = Special = Passion = Plot Compelling = Mythology = Cause = Connection = Heart

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)

T.T.D.: “How can I know what I think till I see what I say”* Exercise : Write copy for a bookmark! (Etc.) *Graham Wallas, The Art of Thought

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

“Salt is salt is salt. Right? Not when it comes in a

blue box

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

Brand Outside

Reprise

S1: Lead the Customer!

S2: Re-invent with E-Commerce!

S3: Fighting Back via Systems integration!

S4: Design Matters! S5 : It’s the Experience!

S6: Women Rule! (and the elderly) S7: Embracing an Age of Self Determination!

S8: Brand Power & Summary!

Lead the Customer: Why Tough

Guts!

Failures!

Re-invention via ecommerce: Why Tough Total commitment to total enterprise [and supply chain] reinvention!

Systems Integration: Why Tough Completely new view of what a “product” is.

Design: Why Tough True-believer-dom-ship Encompassing/Cultural

Ing-ing/Experience: Why Tough

Total Reorientation

Women’s Market: Why Tough

Encompassing Attitude CULTURAL!

Self-Determination: Why Tough

Cede Control

Brand Power: Why Tough Way of Life Forever!

Passion Rules!

Touches Everything!

It Am Me [Personal!]

Message :

Not for the Faint of Heart!*

*Weenies need not apply

Part I: Brand Inside Part II: Brand Outside

Part III: Brand Leadership

Brand Leadership

Passion Rules!

“Leadership is a performance.

You have to be conscious of your behavior, because everybody else is.” Carly Fiorina

“It is necessary for the President to be the nation’s No. 1 actor.”

FDR

Brand Leadership!

“A key – perhaps the key – to leadership is

the effective communication of a story.”

Howard Gardner

Leading Minds: An Anatomy of Leadership

“Create a Cause, not a ‘business.’ ”

Gary Hamel, Fortune (06.00), on re inventing a company (Exemplar #1: Charles Schwab)

Brand Leadership: ENTHUSIASM RULES!

“I am a dispenser of enthusiasm.”/ Ben Zander

“A leader is a dealer in hope.”

Napoleon

“If things seem under control, you’re just not going fast enough.”

Mario Andretti