Business Insight Zone

Here are the top five posts, ranked by page views, that appeared on this blog in April.

1. Silicon Valley, the IPO drought, and the culture of innovation.
2. Needed: EVPs of Common Sense.
3. My definition for Clutter.
4. The Sun-Oracle puzzler.
5. I just wanted to buy a stamp.

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Image by woodley wonderworks, used under Creative Commons license.

Many thoughts from yesterday at the Inbound Marketing Summit, which I’ll come back to later and flesh out more. Meanwhile, bullet points, for the people:

• In his keynote, David Meerman Scott closed by saying we should “stop making excuses” for not creating World Wide Raves around our products.
• Has Twitter obviated the need for Q&A? The talks and panels at IMS come in super rapid fire. Some of the sessions leave time for Q&A, some don’t.
• John Kembel of HiveLive: “Any community takes calories.”
• People WANT to share, IF nothing’s in their way.
• “Systems silo, humans don’t silo.”
• Vis-a-vis the purpose of community platforms: information on its own is just the start of things — the real kicker is when people take action on it.
• Charlene Li says she’s a “binge blogger and binge twitterer.” She’s always had very specific goals for using both of these.
• My good friend Aaron Strout offers five steps for business use of social media: listen, join (existing communities), ask, engage, build (your own community).
• Aaron again: think lifestyle, not product.
• Aaron’s parting thought: building community is not a campaign — it’s a philosophy that takes time to come to fruition.
• Advertising isn’t dying, BAD advertising is dying. The bad stuff has no continuity, no relevance. Thus saith Darren Guarnaccia of SiteCore.
• Marketers beware: People want to segment themSELVES, not just to be labeled as a persona.
• Brian Halligan of HubSpot: The past 50 years of marketing were about interrupting your way into people’s wallets; the next 50 will be about being found (via search, blogs, social networks).
• Halligan again: most Web sites are broken in function. They should (1) attract visitors and (2) convert them to action.
• Common theme through the day: go where your audience already is.
• A good line from from my friend Amber Naslund: “Social media did not invent criticism.”
• I like Phillip Ocampo’s point: social media listening doesn’t have to be a time-suck if you’re getting value from it.
• Another good point from Amber: why wouldn’t you harvest all the information that’s out there in the social media?
• “Meaning is what matters.” (Not sure which speaker said this.) Context is key.
• Mike Troiano: “Listen systematically but engage individually.”

Many thoughts running through my mind — not least because I’m finishing this partway through Day 2 of IMS, after my own presentation (which seemed to go well) and the feedback I’ve gotten on it.

My humble contribution to the Cluetrain Plus 10 project . . .

The Cluetrain Manifesto contains 95 theses intended to challenge old ways of thinking about how companies relate to their audiences. The thesis in the title comes in this context:

36. Companies must ask themselves where their corporate cultures end.
37. If their cultures end before the community begins, they will have no market.
38. Human communities are based on discourse—on human speech about human concerns.
39. The community of discourse is the market.
40. Companies that do not belong to a community of discourse will die.

We’ve come through a long period when MASS was everything in marketing. Marketers have concerned themselves with exposing their products to the most viewers, the most households, or the most eyeballs, often with limited regard — or limited ability — to target that exposure very well.

The Cluetrain invites us to get past eyeballs . . . and past “targeting.” If I have something to offer you, I’m going to talk with you about it — emphasis upon both TALK and WITH.

Look at the picture of the vegetable souk above. People, food, a marketplace. “How fresh are these melons?” “Can you get oranges this month?” “How’s your sister’s baby?” It’s easy to understand why, say, Coca-Cola has taken a different approach for 100 years . . . but that doesn’t mean it’s the ideal approach, or the ideal approach for every product, or the ideal approach for your company/product/cause.

If what you’re offering is a good thing, people will want to talk about it. They should talk about it. You should talk about it. Sure, some people won’t get what you’re doing, or they’ll reveal that they’re soreheads in general. No doubt the vegetable vendor runs into that, too. But the vendor — the old-fashioned face-to-face merchant — also knows that you can’t ignore the conversations going on around your offerings. So embrace those conversations.

One more thing: the explosion of the social media in the past few years means that it’s easier and cheaper and better to do this sort of talking — more so than the Cluetrain authors could have known ten years ago. (That said, they did a pretty good job of foreseeing the future.) Today more than ever, you can identify your market niche, the people who want to talk about and buy your vegetables, be they ever so far-flung around the world.

Those people talking about your wares — they are your market. Find them and talk with them.

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Photo by Verity Cridland, used under a Creative Commons license.

Lawrence is funny — he’s showing us his whole preso (simple, visual, elegant) in slide-sorter format. Don’t think he’s doing it as a dig against Hinchcliffe, but it does highlight the difference between the two decks.

“20 practical ways (to use social software) to drive profitability”

The people in this room live on “Social Island” (gorgeous tropical island picture).

The rest of the company lives on “Anti-social Island” (dismal cube farm picture) — big laugh.

The key is to get past the point where the rest of the company looks at social media and says “That’s a cute purse.” Implies we have to get beyond our inside-baseball jargon.

(He’s really funny.)

How do you become conscious again? So much of what we do in business is done unconsciously — we just do it by rote. We’ve got to wake up from this.

If you’re in management, you have to do three things:

1. Choose where you want to work. — not “knob-and-dial,” business-as-usual efficiency, but centered on effectiveness.
2. Create different. — Stop copying each other. (Examples: Starbucks, TiVo, iPhone, crossover vehicles.)
3. Get the big picture. — “Get off the island and speak native tongue.”
4. Reconnect your knights. — We’ve become the un-Knights of the Round Table — we’ve got to get back in touch across corporate silos.
5. Decide. — Make faster decisions — more action.
6. Build what people want. — Go find out what they want by talking to them.
7. Release faster. — Get products out faster.
8. Go from use-cases to using cases. — Go back and see how people are really using what you’re selling. Don’t write a brief.

Sales

• Feed the pipe.
• Shorten sales cycle. — how much does it cost? and how long does it take?
• Sell more. — Engagement with customers means they BUY MORE from you.

HR

• Shorten the ramp — How long does it take to get a new employee up to speed?
• Unpack your bags — entertain people.
• Pack your bags.
  • fire people who suck
  • make the don’t-sucks better
  • let the rock stars promote

Support

• Prevent defections
• goose satisfaction
• minimize interactions
• reuse, feed product managers
• control support costs

• SEOh-yeah.
• Materially better — Save yourself from crappy marketing: “open source” it.
• Stop eating jellybeans at focus groups
• Research costs a ton
  From months to hours

  Stop the flash-in-the-pans.
  –one-time stuff costs too much.
  create perpetual value
  revenue through virtual pavilions.

Never go small.

• Be different.
• Commit.
• Prepare to Go Big.

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This is an experiment, folks — gonna try live-blogging Dion Hinchcliffe’s opening keynote at Interactive Austin ‘09, which is just getting underway at the Norris Conference Center in north-central Austin.

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Our MC today is Dara Quackenbush. Hashtag for this session is #ia09.

Today’s theme: “How Social Media Can Enhance Enterprise Profitability.” The goal is to give a “state of the union” of what’s happening in the commercial use of social media, and to give a lot of specific examples. He views a lot of these not as nice-to-haves, but as “imperatives.”

Hinchcliffe will make slides from today available — just e-mail him.

New ways of doing old things: old business models replaced by new models, which implies economic, social, financial changes.

He presents a slide (pretty colors, but *very* busy visually) with four categories for change relating to social media:

• Innovation
• Growth (tough to do, but Amazon is doing it)
• Transformation
• Cost reduction

Fundamental shifts:

• Who creates value — companies are vastly outnumbered by customers, so we should turn to them to create value for us.
• How much control we have over our businesses.
• How intellectual property works.
• Increased transparency.
• Open supply chains, community-based processes & relationships.

Avoiding “cargo cults” — people imitate without understanding.

Cheaper / better / innovative — this is what DH is looking for.

Cultural “chasms” — especially around command & control. (This is a very good point: many business leaders are simply uncomfortable with the flattening brought by social media.)

[missed some stuff here]

Proven benefits
Repeatability

Now in the “early majority” stage of social-media adoption — we’re past early adoption. [missed some stuff] One-third of all businesses using social media, and only e-mail & search drive more traffic today.

Candidate areas for improvement — everything from IT/back-office through customer service, sales, marketing, and product development.

By incorporating customers into businesses processes, companies are lowering costs WHILE satisfying customers better.

“No small system can withstand sustained contact with a much larger system without being fundamentally changed.”

(I’m sitting next to my friend Stephanie Pfeffer: she makes the point that DH is doing a fair bit of talking about what he’s going to talk about . . . rather than just talking about it.)

Motive forces of 21st-century economics:

• network effects
• peer production
• self-service
• open business models
• new social power structures

(Oooh — he misused “literally.” Grrr . . . )

Talking more about network effects — where the value increases as more people use it. Example: Documentum vs. wikis within big organizations.

(Don’t get me wrong — DH is making lots of good points, but he’s stepping on a few flowers as he heads down the path.)

Interesting talk about the Web 1.0 era versus now — not just in terms of Web technology, but in terms of business models & product development.

• W1.0 means we push the product to you, we listen to you very little & only when we want to, we do everything ourselves.
• W2.0 means we open things up to you (in a controlled way), bring the power of the network into the enterprise, open up to more variety & volume.

Example: how broadcast is being undermined/revolutionized by YouTube (and, I would add, other channels).

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Social Media within Businesses (a.k.a. Enterprise 2.0)

Modern social computing: Enterprise 2.0 — cites Andrew McAfee of Harvard Business School. (By all means, read McAfee’s blog — super-smart guy.)

“Emergent, freeform, social applications”

“Globally visible, persistent collaboration”

Enterprise 2.0 systems adapt to the environment, rather than requiring (or attempting to require) the environment to adapt to it.

Perceived benefits of E2.0

• increased knowledge retention
• more adoption & use of knowledge mgmt tools
• emergent structure & processes
• increased transparency
• less duplication of work
• higher level of productivity

Why is E2.0 different?

• maturing techniques to leverage work better
• power of emergent over pre-defined solutions
• barriers to use = nearly zero
• low cost
• driven by network effects

E2.0 checklist [sorry -- missed this]

Richer outcomes
–not just slight increases, and no time lag

Compares the old top-down way to Soviet 5-year plans.

E2.0 as non-interruptive (?) and leveragable. (I would point out that for them to be non-interruptive, you have to have the right social behaviors within your organization.)

Challenges:

The enterprise is not the Web. Simple tools designed for consumers don’t just port directly. (This is a very bad slide for a preso — I’m sure it will be great when I see the deck up close and can read the eye-chart text.)

Enterprise 2.0 Ecosystems (gonna need to see the chart to make sense of this one — sorry).

(He’s still talking about what’s coming later — unclear to me if he means in the remaining 20 mins of his talk, or in the sessions later today.)

(Gonna have to think harder about what he’s saying about the industrial & information revolutions in the 20th century.)

Now summarizing E2.0 benefits

Majority of Global 2000 firms are now buying Web 2.0 tools. Small employers mostly not doing this — yet.

E2.0 bottom line:

• Repeatable
• Medium risk
• Proven benefit
• Rapid ROI

Fascinating chart showing traffic to Amazon.com (et al.) versus Amazon Web Services.

(This is LOTS of information / thoughts / text / stuff-to-digest. That has big pluses and minuses for the audience. Hard to keep up with what he’s saying.)

Eliciting participation on the network

• social media
• online community
• collective intelligence

Business / community / technology — DH cites Jeremiah Owyang’s Venn diagram for this.

(A couple of folks on Twitter have pointed out that DH is using examples of massive enterprises to an audience of pros from small and medium businesses.)

Customer engagement as going beyond products & marketing. “It’s a meaningful emotional connection . . .”

(He’s machine-gunning through text-heavy slides here — bad cognitive practice that ill serves the audience.)

What do online communities do? — Word-of-mouth, etc.

(Sort of an abrupt wrap-up.)

(Whew!)

~ ~ ~

Chuck Salter wrote a typically smart take on some of the technological advances in American medicine in this article:

The Doctor of the Future

It’s recommended reading if you care about health care. I’ve met Chuck and admired his work for years, so don’t take what I’m about to say as a criticism of him or his article.

He first points out some of the key problems with medical care in the United States: “Although we have the world’s most expensive health-care system, 24 countries have a longer life expectancy and 34 have a lower infant-mortality rate.” Then he explains how new generations of both doctors and technology are helping to address those problems, and how the “ability to expand and harness knowledge . . . makes cutting-edge information technology such a powerful driver of the emerging health-care revolution.” The article is interesting and well-reported, and it’s not Chuck’s job to go into every aspect of the health care equation in this country — which, you may have noticed, is complicated.

But as you and I think about addressing problems, we ought to be leery of putting too much emphasis on new technology to get us out of old problems. This applies just as well to great big problems like health care and climate change as it does to smaller ones like, oh, declining cash flows or increasing employee turnover in your own business.

Mind you, I like my high tech, and indeed I spent several enjoyable years covering it for Hoover’s, but it’s a trap to focus on technological solutions to the exclusion of behavioral ones.

Here’s what I mean: the advances that Chuck is writing about — things like social media-enabled telemedicine and robot-assisted surgery — clearly can do wonderful things for American medicine. But it wasn’t the absence of these things that led to the problems we face. We’re not 35th in infant mortality because we lack technology or money; we’re 35th because we haven’t behaved as smartly as (at least some of) the 34 countries ahead of us.

If you’re umpteenth in your industry, it’s probably not strictly because your technology is poor. It comes from a thousand little and big things that have compounded together over the years to render the whole less than the sum of its parts — just like the American health-care system.

Now, set aside your pipe dreams of technological fixes. How can you BEHAVE differently this week to put yourself in a better position?

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Photo by kokopinto, used under a Creative Commons license.

It’s Friday, which means it’s FollowFriday on Twitter. Explanations follow . . .

• What: You recommend people whom others might like to follow on Twitter.
• Why: To publicize good (helpful, funny, informative, etc.) folks on Twitter, and to help Twitter newcomers find good people to follow.
• How: Typically, a tweet like this: “Good #followfriday folks: @JohnSmith @JaneDoe @RichardRoe @JoeBlow @BethJones @DaveJohnson @JillDavis”

As the made-up example attests, the downside to the typical FollowFriday method is a lack of context. I may tell you that John and Jane and Richard and the rest are great to follow, but how helpful is that if I don’t tell you why, and if their names come in a string with half a dozen other folks?

Less-than-optimally-helpful, as I came to think after I realized I was simply tuning out most of these tweets, even from good friends of mine. So, here are examples of the FollowFriday tweets I’ve started doing:

• “If you live in Austin and crave excellent coffee talk, your wrecking crew starts with @chris_bailey & @productjustin. #FollowFriday”
• “An old Twitter friend (and faithful blog reader) I had the pleasure of sitting with at SXSW: @KeithBurtis #followfriday”
• “Consistently engaging & a great promoter of others’ work: @delwilliams #followfriday”

You get the idea: not just a listing of people I like to follow, but a specific endorsement for the good qualities of a person or two. From my perspective, at least three benefits accrue to this method:

1. You get a sense of why I enjoy following these people, and thereby why you might want to follow them as well.
2. It gets away from the numbers game and emphasizes relationships, which I think is a much better use of Twitter. Rather than throw big numbers of recommendations at you, I’m offering to expand the circle of your acquaintance by one valuable person. I hope this works something like making a personal introduction at a dinner party.
3. It doesn’t slight anyone by omission. When you list 20 or 30 people, it’s possible that some lovely folks you don’t list will feel slighted. (”Hey, I thought we were pretty good friends . . .”) When you describe one person, it’s clear — or should be — that you’re calling out someone worthy, not omitting anyone purposefully.

I hope more people will take this approach, which is hardly unique to me.

What do you think?

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Photo by Clinton & Charles Robertson, used under a CC-Share Alike license.

Between the annual meetings of the Special Libraries Association that Hoover’s attends and business functions around Austin, I’ve gotten to know April Kessler, a business librarian who’s a long-time user of Hoover’s. April was kind enough to field some questions about how she and the students she works with use Hoover’s.

~ ~ ~

Tell us a little about yourself: what’s your professional background, and how long have you been at UT?

Actually I didn’t start out in libraries. I have my MBA and worked in advertising and marketing for 12 years before getting my Master’s in Information Studies in 2004. Since then I’ve done business research in corporate and academic libraries and I’ve been the Business Librarian here at UT for 2 years now.

How do you use Hoover’s in your professional role?

As the library liaison to the McCombs School of Business I work with students and faculty to fill their information needs. Since we are often looking for competitive intelligence Hoover’s is one of our favorite resources. With one search, we can link to competitors, financials, executives — it’s perfect for finding the fundamentals.

How has Hoover’s helped McCombs students land internships or other jobs? What sort of feedback have the students given you?

Working  closely with the McCombs Career Services Department I help students create lists of companies in a specific industry and also direct students to Hoover’s for background information on a particular company to help them prepare for interviews. Students are always surprised by what Hoover’s can do for them and how easy it is to use. These are pretty motivated and competitive students, so any extra edge is appreciated.

What’s your favorite aspect of Hoover’s?

Other databases let you create lists of companies, but one of the features in the Hoover’s Build A List function is that you can search executive bios by keyword. So much of business is about networking and finding a connection to someone. Being able to search via an alma mater can be the ice breaker someone needs to get in the door.

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Given that Hoover’s has been headquartered in Austin from the beginning, you can guess that many of the folks on staff here are UT alums, and we’re happy to have an informal pipeline of McCombs graduates into our ranks. Thanks to April for taking the time to field these questions — and for continuing to be one of Hoover’s biggest fans.

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Photo by ydhsu, used under a CC-Share Alike license.

“Fix everything two ways.”

That’s an excellent piece of advice from Joel Spolsky (from an article I’ve quoted before). The first way is to fix the problem of the moment; the second way is to solve and settle the underlying issue.

This matches the wisdom embodied in the Toyota Production System that you should stop to fix problems the first time. (It’s worked out pretty well for Toyota.)

Simple, huh? Plug the leak, sure — but take the time to figure out why the leak happened in the first place, how you can keep it from happening again, and what you need to do to rebuild that part of the system so it’s leakproof.

You do have time to get it right. Fix everything two ways. No more excuses.

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Photo by Greg Younger, used under a CC-Share Alike license.

Here comes the Sun . . . but why?

Yesterday I spent a good chunk of time talking to two of my Hoover’s colleagues — Josh Lower, who has covered Sun Microsystems throughout this decade, and Seth Shafer, who has done the same for Oracle.

Unless you spent the day sequestered in jury duty or something, you’ll know we were talking about Oracle’s proposed acquisition of Sun, which has been all over the business headlines.

Several parts of the deal’s logic seem clear:

• Oracle adds Java and Solaris to its software stable. Check.
• Databases! Get yer databases here! Check.
• Oracle has been great at integrating big acquisitions, as another colleague, Jeff Dorsch, pointed out earlier. Check.
• This moves Oracle beyond “mere” competition with SAP, and puts it right in the data-center wheelhouse of Hewlett-Packard and IBM. Check.

The lingering question for all three of us:

What makes Oracle so sure it can integrate Sun’s hardware units into its own software business?

All of us have been watching the tech sector long enough to understand that “Larry Ellison’s ego” could be a sufficient answer to this question. Still, that would be a pretty scary answer, considering the size of the acquisition.

Seth raised the point that Oracle could come out looking pretty good regardless of what happens with Sun’s hardware units. If they never fit, Oracle can blame the economy — or say that the Sun units were in worse shape than anyone realized, or that Oracle realized they could get more value out of them by selling them to other hardware companies. But if the integration does work, then Ellison looks like a wizard for pulling off something that no one else even imagined.

Or maybe there’s a reason no one else ever imagined it.

Your thoughts?

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Photo by cat’s_101, used under a Creative Commons license.