Customer World

Emerging Technology trends that will shape business and economic growth - McKinsey's perspective

Carleen Hawn has drawn-up a nice summary of McKinsey's article.

Technology alone is rarely the key to unlocking economic value: companies create real wealth when they combine technology with new ways of doing business. … we have identified eight technology-enabled trends that will help shape businesses and the economy in coming years. These trends fall within three broad areas of business activity: managing relationships, managing capital and assets, and leveraging information in new ways.

A. Managing relationships

1. Distributing cocreation

The Internet and related technologies … allow companies to delegate substantial control to outsiders—cocreation—in essence by outsourcing innovation to business partners that work together in networks. By distributing innovation through the value chain, companies may reduce their costs and usher new products to market faster by eliminating the bottlenecks that come with total control.

The Caution:
Companies pursuing this trend will have less control over innovation and the intellectual property that goes with it, however. They will also have to compete for the attention and time of the best and most capable contributors.

2. Using consumers as innovators

Consumers also cocreate with companies; the online encyclopedia Wikipedia, for instance… Companies that involve customers in design, testing, marketing (such as viral marketing), and the after-sales process get better insights into customer needs and behavior and may be able to cut the cost of acquiring customers, engender greater loyalty, and speed up development cycles.

The Caution:
But a company open to allowing customers to help it innovate must ensure that it isn’t unduly influenced by information gleaned from a vocal minority. It must also be wary of focusing on the immediate rather than longer-range needs of customers and be careful to avoid raising and then failing to meet their expectations.

3. Tapping into a world of talent

… Much as technology permits [companies] to decentralize innovation through networks or customers, it also allows them to parcel out more work to specialists, free agents, and talent networks…new talent-deployment models could emerge [and] changes in the nature of labor relationships could lead to new pricing models that would shift payment schemes from time and materials to compensation for results.

The Caution:
This trend should gather steam in sectors such as software, health care delivery, professional services, and real estate, where companies can easily segment work into discrete tasks for independent contractors and then reaggregate it … Competitive advantage will shift to companies that can master the art of breaking down and recomposing tasks.

4. Extracting more value from interactions

Companies have been automating or offshoring an increasing proportion of their production and manufacturing (transformational) activities and their clerical or simple rule-based (transactional) activities. As a result, a growing proportion of the labor force in developed economies engages primarily in work that involves negotiations and conversations, knowledge, judgment, and ad hoc collaboration—tacit interactions, as we call them. By 2015 we expect employment in jobs primarily involving such interactions to account for about 44 percent of total US employment, up from 40 percent today.

The Caution:
Tere is still substantial room for automating transactional activities, and the payoff can typically be realized much more quickly and measured much more clearly than the payoff from investments to make tacit work more effective. Creating the business case for investing in interactions will be challenging—but critical—for managers.

B. Managing capital and assets

5. Expanding automation

Companies, governments, and other organizations have put in place systems to automate tasks and processes [like] forecasting and supply chain technologies…. Now these systems are becoming interconnected through common standards for exchanging data and … this information can be combined in new ways to automate an increasing array of broader activities, from inventory management to customer service.

The Caution:
Automation is a good investment if it not only lowers costs but also helps users to get what they want more quickly and easily, though it may not be a good idea if it gives them unpleasant experiences. The trick is to strike the right balance between raising margins and making customers happy.

6. Unbundling production from delivery

Technology helps companies to utilize fixed assets more efficiently… Information and communications technologies handle the tracking and metering critical to the new models and make it possible to have effective allocation and capacity-planning systems. Amazon.com [has] expanded its business model to let other retailers use its logistics and distribution services [and] independent software developers … buy processing power on its IT infrastructure so that they don’t have to buy their own. Mobile virtual-network operators, another example of this trend, provide wireless services without investing in a network infrastructure.

The Caution:
Companies that make their assets available for internal and external use will need to manage conflicts if demand exceeds supply. A competitive advantage through scale may be hard to maintain when many players, large and small, have equal access to resources at low marginal costs.

C. Leveraging information

7. Putting more science into management

Technology is helping managers exploit ever-greater amounts of data to make smarter decisions and develop the insights that create competitive advantages and new business models. From “ideagoras” (eBay-like marketplaces for ideas) to predictive markets to performance-management approaches… Leading players are exploiting this information explosion with a diverse set of management techniques. Google fosters innovation through an internal market: employees submit ideas, and other employees decide if an idea is worth pursuing or if they would be willing to work on it full-time.

The Caution:
Leaders should get out ahead of this trend to ensure that information makes organizations more rather than less effective. Information is often power; broadening access and increasing transparency will inevitably influence organizational politics and power structures. Environments that celebrate making choices on a factual basis must beware of analysis paralysis.

8. Making businesses from information

Accumulated pools of data captured in a number of systems within large organizations or pulled together from many points of origin on the Web are the raw material for new information-based business opportunities… market imperfections include[ing] information asymmetries and the frequent inability of decision makers to get all the relevant data … allow middlemen and players with more and better information to extract higher [prices] by aggregating and creating businesses around it.

The Caution:
But that sword can cut both ways; today’s aggregators, for instance, may themselves be aggregated tomorrow. Companies relying on information-based market imperfections need to assess the impact of the new transparency levels that are continually opening up in today’s information economy.

Secrets to building a customer-centric organization - #4

When it comes to building a team in an organization that thinks and breathes customers & selling best-in-class offerings, the process of recruiting the right 'fit' people rather than just the right people is important. What does this mean? It means that you might have identified the most qualified and the most experienced person for the job but they might not fit the culture, values, motivation, passion and environment that you may have in your company. The right fit is as much important as the right people. NY Times has an interesting article on 3 ingredients of success which provides more insights when you want to evaluate people and understand why they do what they do:

• After interviewing 200 people worldwide “who have made a difference in their fields,” three authors conclude that “success in the long run has less to do with finding the best idea or business model than it does with discovering what matters to us as individuals.”

• “When success just means wealth, fame and power it doesn’t last and it isn’t satisfying.”

• ...builders find lasting success when three essential elements come into alignment in their lives and work.

1. The first element is meaning. “What you do must matter deeply to you,”
2. The second is a “highly developed sense of accountability, audacity, passion and responsible optimism.”
3. Successful people “find effective ways to take action.”

Check the people who you want to recruit against this backdrop because you want to have in your team winners and not losers. Believe me, the difference will show and your customers will see it.

Secrets to building a customer-centric organization - # 3

Every customer-centric organization has to create a culture of organizational authenticity.

There is an interesting discussion around this topic in Fast Company. I have taken a few of the discussion points and posted them here.

What is organizational authenticity? Organizational authenticity means what is felt and thought concerning the mission and purpose aligns with what is said and done on a regular basis. - Paul S Markle

Transformational leadership transcends the one or few individuals and instills a sense of purpose and vision in the entire organization. The power play role of leadership is more focused with their position in their 'world' than organizational authenticity / integrity . - Donna  Karlin

How does a company ensure they attract authentic leaders for sustainability and growth and to promote a culture that is based on integrity?

"I believe there has to be a two way accountability pact or structure where both staff and leadership can ask and answer the question (in the affirmative) "Am I where I need to be to reach my level of excellence?" and "I am inspiring all those around me to reach for their level of excellence?" And can all include "...and live in alignment with my personal values and ethics?" If the people care about each other enough to ask, then they'll care enough to be authentic." - Donn Karlin

Here, you can take a organizational authenticity quiz. Go on and take the test!

Secrets to building a customer-centric organization - # 2

When it's Disney, you know there is more passion behind the company than just some products, characters or merchandize! No wonder, it shows in the customer experience.

Read some Disney quotes and understand the passion behind the man and his ideas:

“Disneyland is a work of love. We didn’t go into Disneyland just with the idea of making money.”

“When we opened Disneyland, a lot of people got the impression that it was a get-rich thing, but they didn’t realize that behind Disneyland was this great organization that I built here at the Studio, and they all got into it and we were doing it because we loved to do it.”

“Disneyland is like a piece of clay, if there is something I don’t like, I’m not stuck with it. I can reshape and revamp.”

“The idea of Disneyland is a simple one. It will be a place for people to find happiness and knowledge. It will be a place for parents and children to share pleasant times in one another’s company; a place for teachers and pupils to discover greater ways of understanding and education. Here the older generation can recapture the nostalgia of days gone by, and the younger generation can savor the challenge of the future.

“To make the dreams of Disneyland come true took the combined skills and talents of hundreds of artisans, carpenters, engineers, scientists and craftsmen. The dream that they built now become your heritage. It is you who will make Disneyland truly a magic kingdom and a happy place for millions of guests who will visit us now and in the future.”

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Leadership scarcity

It's easy for organizations to be wanting to be customer-centric but the challenge is the need for a leader who can set the agenda, pursue the agenda relentlessly, be steadfast about the results, be ruthless about execution across various departments in the organization etc.. But, according to Jeffrey Phillips that's the area where there is a huge gap. Company boards need to find such leaders and there seems to be scarcity for such souls:

....there are few true leaders in most businesses, since it is impossible to pursue more than a handful of "visions" or strategies in any business without complete chaos.  Most senior executives in businesses are "managers" - that is, they understand the vision and attempt to implement it to the best of their understanding.  They don't create the vision, and in most cases don't fully back it or understand it, but are doing their best to implement the vision.  In any context, in any organization, there can be a maximum of one leader in this regard, however, in most firms there aren't any real leaders.  Most CEOs are pragmatists, guided by Wall Street and expected earning and returns.  Some leaders, like Jack Welch for instance, became recognized because he had a vision and pleased the street.  Some leaders, like Steve Jobs, have been recognized for their vision but have had up and down experiences - most likely because they could not communicate their vision effectively to a solid management team below them.  In many other firms, however, it is difficult to identify who is responsible for creating a vision and encouraging people to follow his or her vision.

....The best place today to find true leaders in businesses is in smaller, private firms.

How to get employees engaged?

I have already written in the past about the need to motivate employees to build customer-centric organizations. Technology can only do so much. We can have all the technology in the world but without engaged employees all these investments go down the drain. What are the building blocks of getting started on this? 

Nick Smith has some good suggestions:

• Know where you are coming from.
  It's probably wise, before stepping up to the leadership plate, to examine our own motivations because 'where we are coming from' speaks far louder than anything we might say or do.
• Make conversation a first class citizen.
  Conversation is the way we have got things done since Adam and Eve decided to walk out of the Garden of Eden.  The process flow is always the same:
  Ideas ----> Conversation ---- > Agreement ----> Action.
• Start slow to go quick.
  It's in wandering around, kicking the tires and sharing our frustrations that we come to discover a place we can call our own within a team.. something we can contribute and feel good about.. some role that we can fill (or learn to) that is personally meaningful to us.
• Get comfortable with blindness.
  Helping people find their own inspiration can be tricky.  Many times we don't consciously know what we want ourselves, but it comes disguised as a rant.  After all, we never get angry about the things we don't care about.
• Let go of the concept of 'failure'.
  Going out on a limb is messy.  It's all new to us, like learning to walk all over again.  We trip, we fall down, we pick ourselves up and then we do it all over again.  If we've got someone looking over our shoulder ready to snatch back control when we mess up, then we give up trying.
• Use consent rather than consensus as a framework for decision making.
  Many of us talk about Enterprise 2.0 as the democratisation of the workplace.  But seriously, is democracy that good a model?  As far I can see there are two big problems with it.  First, the bigger and the more diverse the group, the longer it takes to get a consensus of opinion.  Secondly, debate has a way of killing the brightest ideas.
• Be mindful of unexpected good stuff.
  This is about staying open and receptive to  what can never be planned.  The really magic stuff that comes out of great groups is the stuff that comes out of the blue.  It's not east to describe but when it comes it sneaks up on us and hits us up the side of the head.. and  we know.
• Be disruptive.
  Most people think of good leadership as maintaining order and keeping everything running smoothly.  What we are talking about here is the exact opposite.  Instead of being a good 'motivator' you can be a master disrupter - rearranging things to allow us to do what naturally moves us, and getting the other stuff out of the way.
• Be the keeper of the sacred scrolls.
  Just kidding!.. or maybe not.  It's part of the human condition to forget what is most important to us.  We get stuck in the inertia of those two old, tired ideas - 'work' and 'effort'... and then forget that  the real magic happens when we just enjoy our Selves.

21st Century CEOs - The emerging specialist CEO

BusinessWeek has an interesting article on the challenges of finding the right CEOs for corporations. The article goes on to mention that it will soon be the age of specialist CEOs. Take a look:

James M. Citrin, corporate kingmaker, has long had a close-up view of the leadership demands of the world's most dynamic companies. As founder of Spencer Stuart's technology, communications, and media practice, the executive recruiter has placed 165 chief executives, chief financial officers, and directors since 1994.

Citrin expects five specialist CEO types to be in the greatest demand:

• THE BRAIN
  Whether they're algorithm geniuses, coding prodigies, or merely credentialed scientists or designers, CEOs in touch with their inner geeks will be a sought-after breed. As global competition intensifies the pressure for top-line growth, innovators-in-chief will be more clued in to the next breakthrough business. ARCHETYPE: Arthur D. Levinson, the CEO of Genentech. (DNA ) Levinson has a PhD in biochemistry and is known for sending out late night e-mails to his researchers on details in scientific papers.
• THE AMBASSADOR
  A two-year stint in London may have counted as enough international experience in the past, but that won't be the case much longer. "More and more of our CEO specs are calling for explicit business experience in emerging markets," Citrin says. Boards are looking for CEOs with passports showing frequent visits to China and India, along with Russia, Brazil, and Dubai.ARCHETYPE: Citrin points to News Corp. (NWS ) CEO Rupert Murdoch, who has long wooed Beijing officials and launched alliances with local companies. Another example, he says, is PepsiCo CEO Indra K. Nooyi, who was born in Chennai, India.
• THE DEALMAKER
  Citrin believes dealmaking specialists—those able to both sell off noncore assets and go toe-to-toe with private equity players on big acquisitions—will be in heavy demand.ARCHETYPE: Retired AT&T (T ) CEO Edward E. Whitacre Jr., who turned SBC Communications (T ), once the smallest of the regional Bells, into a powerhouse with a market value of $242 billion.
• THE CONDUCTOR
  Corporations' walls are only going to get more permeable, as companies form alliances with outsiders and turn to networks of innovators for ideas to put into practice.ARCHETYPE: A.G. Lafley, who says half of all new Procter & Gamble (PG ) products should come from outside its R&D labs.
• THE CASTING AGENT
  If you think "people are our greatest asset" is an overused bromide today, just wait. The talent war is only expected to worsen as boomers begin retiring en masse and emerging-markets managers remain scarce.ARCHETYPE: Xerox (XRX ) CEO Anne M. Mulcahy, who named operating chief and heir apparent Ursula M. Burns to the president's role in April.

To me the most interesting point from this article is that company boards need to decide what kind of leadership do they need for their companies at the moment and well into future - say next 3 -5 years.There might well be good and brilliant CEO prospects to choose from but they might not fit the specific need keeping in mind the company's current plans and objectives in the near future. Therefore, it needs careful planning, thinking and then selection.

Attn: CEO - Great marketing + Great Technology is the only way forward

George F.Colony CEO, Forrester, has written a brilliant paper on how technology has broken down the barriers that existed between companies and customers. In an era where the 30-sec TV Spot and newspaper ads are dying, over the last couple of years, I too have come to firmly believe that marketing and technology departments in companies have to come together and work closely, if companies want to build truly tangible value for their customers. 

George goes on to explain how CEOs need to pay attention to this increasingly:

• Marketing and technology in your company must work together to design and implement your Web 2.0 strategy. And you, and only you, can get the dogs and cats to interbreed. It's an unnatural act, but one that must occur before your company can become an opportunist, rather than a victim, in the world of Web 2.0.
• You may try to restrict your digital content through laws, rules, digital rights management, and/or security systems. The cold reality remains that customers, citizens, consumers want what they want, regardless of how you may try to restrict them. They see the power of digital and its inherent flexibility.
• You've got to earn the respect and allegiance of your customers every day — both of which can wither with unparalleled speed (see Dell and the flaming batteries, circa 2006).
• Get your marketers to throw out those 30-question customer surveys and focus on one question: "Would you recommend this product or service to a friend or colleague?"
• After eight years of evaluating more than 1,000 large corporate Web sites, Forrester found only 3% with passing grades. The vast majority are hard to use, confusing, poorly designed, and cast an unfavorable shadow over the brand.
• It's now a two-way conversation. Listen, respond, and talk intelligently. Stop dictating to customers. It's your customers, not you, that have the power.

Lovely stuff and worth putting into action rightaway!

Getting into next gear

Sometime early last week, I announced my decision to quit iContract, one of India's leading one-to-one agencies.

It was a job that I had really loved to do for the entire part of the last 14 years of my working life -  building and growing iContract. iContract is a one-to-one division of Contract Advertising ( a subsidiary of JWT in India and also a part of WPP Group).

Over the years at iContract,there are a lot of people who made this happen. I must admit this is not an individual effort but it was a team effort. It was just people who made a big difference to iContract without whom this would not have been possible. The most important of them include Bimal Nair(Currently Executive Vice President, Rediffusion DY&R), Samir Shanbhag(Currently Group Account Director, BrandCom Middle East), Leroy Alvares(Currently Country Head, Tribal DDB), Harsh Grandhe( Currently Vice President, Rediffusion DY&R), Allwin, Vineet Kumar, Parag Sen and Nishad Ramachandran. They have been great colleagues, friends, evangelists and advisors for me at various points of time during my years there. Each of them gave more than 100% commitment when needed, carried the organization and its agenda as if it were their own and it was  great fun working with them. 

I am now in the midst of setting-up my own venture. Will let you know how things progress at my end.

Know the value of your customers

Geoffery Colvin has written a book Angel Customers and Demon Customers. He has some nice point of view on these kinds of customers:

In our experience across a wide range of industries, companies typically find that the best 20 percent of their customers account for 150 percent of total profits! The worst 20 percent typically lose money equal to 75 percent of profits, while the remaining 60 percent of customers account for the rest. Knowing which customers are angels and which are demons presents an enormous opportunity.

Once you know the true profitability of your customers, you can figure out the reasons behind the numbers. For your unprofitable customers, you'll have to face the reality that you're not offering them a compelling value proposition - a way of meeting their needs so well that they'll reward you with handsome profitability. You'll have to devise new, better, value propositions for them, which our experience shows you can probably do. As a result, you'll start to turn those unprofitable customers into profitable ones, which typically creates a substantial swing in the business's overall profitability.

In the end, you may find that a small percentage of customers just cannot be made profitable. By the time you've figured out who they are, you'll understand very well why they probably aren't worth keeping.”

Have you found yours?

Thro' Brand Autopsy

Toxic employees and customer management

Seth Godin provides an interesting perspective on toxic employees and how they manage customers:

Toxic employees are the ones that have difficulty with their co-workers, or worse, far worse, with your customers.They make two big confusions:

• They confuse "How can I help this prospect/customer?" with "How can I get rid of this person and get back to work?"
• They confuse, "How can I have a better day by treating this person with a great deal of respect?" with "Why isn't this person treating me with the respect I deserve?"

Managers can hire the non-toxic, re-assign the toxic and be really clear with themselves that they're willing to pay almost any price to keep toxic employees away from everyone else. And if toxic employees appears to be a pattern, my bet is that it's your fault, not the employees.

Learning innovation from Apple

Economist has a fantastic article on learning innovation principles from Apple. Here are some tips from the article:

Not invented here and very welcome here

The first is that innovation can come from without as well as within.In fact, its real skill lies in stitching together its own ideas with technologies from outside and then wrapping the results in elegant software and stylish design. The idea for the iPod, for example, was originally dreamt up by a consultant whom Apple hired to run the project. It was assembled by combining off-the-shelf parts with in-house ingredients such as its distinctive, easily used system of controls. And it was designed to work closely with Apple's iTunes jukebox software, which was also bought in and then overhauled and improved. Apple is, in short, an orchestrator and integrator of technologies, unafraid to bring in ideas from outside but always adding its own twists.This approach, known as “network innovation”, is not limited to electronics.

Designing new products around the needs of the user, not the demands of the technology

Too many technology firms think that clever innards are enough to sell their products, resulting in gizmos designed by engineers for engineers. Apple has consistently combined clever technology with simplicity and ease of use.

Stay hungry. Stay foolish

Listening to customers is generally a good idea, but it is not the whole story. For all the talk of “user-centric innovation” and allowing feedback from customers to dictate new product designs, a third lesson from Apple is that smart companies should sometimes ignore what the market says it wants today.

Fail wisely

The Macintosh was born from the wreckage of the Lisa, an earlier product that flopped; the iPhone is a response to the failure of Apple's original music phone, produced in conjunction with Motorola. Both times, Apple learned from its mistakes and tried again.

Living life in the edge

I have been reading a lot articles on disruption,crisis management in corporations, rapid cultural changes in society, changing media habits of consumers due to new techonologies etc. I have always wondered how does one keep pace with such sweeping changes and how, me as a leader, keep the edge without jumping off the edge? Here are some interesting tips from Fast Company on what some leaders do:

Many leaders say that pushing the limits outside the office gives them the experience of being in the moment, especially in times of crisis and keeps them focused, ready to take action. They say it helps them become comfortable with pressure and embrace risk.

• Continue moving…inaction leads to stagnation.
• Read…anything.
• Talk to people…constantly.
• Ask for feedback and be open to what you hear.
• Try something that seems counterintuitive.
• Don't let others in your organization do all the dirty work.
• Go work "on the line or in the trenches".
• Do a 360 on yourself.

Try This

Make a list of all the things that inspire you about other leaders. Compare them to your skill sets. What are you missing that they have? This is a great place to start understanding what you need to do to go to the next level. Then start learning those skills and practicing them. Start now, even if it's scary. You don't have to jump out of a plane to get your heart pumping; sometimes it is as simple as looking in the mirror and telling yourself the truth about something you should be doing and then taking the steps to do it.

'Physical Size Does Not Guarantee Success; What Matters Is Mental Size'

Subroto Bagchi, COO of Mindtree Consulting makes some lovely points on what it takes to build an organization. Frankly in my view, it's the 'soul of the enterprise' that makes all the difference.Everything else is replacable. Business  will follow if you cultivate the right culture. Ask yourself this question- Does your enterprise have a soul? Surely, your customers will know it, everytime your employees interact with them. May be you can start by asking them first. Be ready for a lot of suprises!

If you then want to go back to the drawing board, you can start thinking with Subroto's advice:

• Being big is not about size, but about mindset - Let us imagine that you want to someday build a skyscraper. You have to pre-think what plumbing must go into the skyscraper. It cannot be an afterthought.So you have to pretend that, "I am a skyscraper." The inlet and outlet for the skyscraper is going to be very different. So pretending [or imagining] is a very, very important thing.
• Countries like Singapore, or Israel, or Finland, are world leaders in many ways. These are developed countries. These countries are at the top-end of GDP. But they are so tiny. They're microscopic when you compare them to countries like India or Pakistan. Many of the African countries are significantly larger. In today's world, physical size does not guarantee success. What is important is mental size. Nokia was created out of Finland. Singapore's GDP is way bigger than the GDP of India, and ... the population of Singapore is half the population of Bangalore.
• Process to Empathy Ratio(PE Ratio)- Process is not a substitute for building an emotionally rich organization. Process without emotion can quickly bring you down to the lowest common denominator.
• Inventive Thinking -When you look at building an organization, yes, the first idea is important, but an organization is built only as an idea of ideas. Sometimes people fail because they don't take a long view of time. Sometimes they fail because they do not adapt. I think adaptability is very important.
• Create the right organization infrastructure - An organization, an enterprise, is about infrastructure.We have to continuously build infrastructure.Many companies do a good job of building the physical infrastructure. Some companies even do a good job of building the intellectual infrastructure. But above these two layers is what I call the emotional infrastructure. This is the most difficult - the most difficult to build and the most difficult to sustain.In a hyper-competitive world, it is easiest to demolish a company at the physical layer. It's less easy to demolish a company at the intellectual layer. But it is the most difficult to break a company apart at the emotional layer.
• Have the right balance - Look at your enterprise as a three-legged stool. One is the employee, one is the customer and the third is the investor. The three have to be balanced at all times. If you try to deliver to the investor at the cost of the employee, or at the cost of the customer, this three-legged stool topples over. So we need to be careful.

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Understanding what makes a leader

Wired has an open debate - Do leaders teach? or Do teachers lead? - between Bill George, Professor at Harvard Business School and Wendy Kopp, President, Teach for America. In the quest of building customer-centric organizations, I feel it is important that there are enough leaders at every level in every organization who have a mission in mind and work towards that purpose relentlessly. This article has some interesting points on leadership which resonated with my thoughts a lot. Hence, I felt it will be a good read for you:

• In my studies of leaders who have failed, these leaders fell prey to the pressures and seductions they faced. It wasn't that they lacked leadership skills, style or power, but that the extrinsic rewards of leadership (money, fame, glory and power) went to their heads.
• Their egos, their greed, their craving for public adulation, and their fear of loss of power overwhelmed their responsibility to build their institutions.
• In contrast, authentic leaders understand that leading is not about advancing themselves and their personal interests, but serving others and bringing them together around a common cause. In the end they create great organizations because people are inspired to step up and lead.
• Perhaps leaders are more likely to stay on course when they're pursuing their passions.
• "Why is it so hard to lead yourself"? The answer lies in differences between your idealized self--how you see yourself, and how you want to be seen-- and your real self--how others actually experience you. The key to being able to develop yourself as a leader is to narrow that gap between your idealized self and your real self by developing a deep self-awareness that only comes from straight feedback and honest exploration of yourself, followed by a concerted effort to make changes.
• Teaching successfully is an act of leadership, and I often hear our corps members and alumni describe the moment they broke through as a teacher as the moment they realized that this work is not about them, but rather about their students.

I think the article really provides insights into how we should plan, prepare, practice and evaluate ourselves honestly, if we have to become great leaders.

Adding soul to contact centres

Olga Botero writes:

I came home one night from work, and my 15-year-old daughter told me, "Mommy, a robot called you to confirm our reservations to go to Peru during Easter break." I could not help laughing. I laughed so much she got upset. She said, "I am serious. It was not a person. It was really a robot." And she started imitating the voice. It was a contact center agent reading a script.

Last week, when my daughter received the call from the "robot," no one asked her why we were traveling. Nobody asked her if we were a family on vacation. No one asked her if we were vegetarian or liked aisle seats or windows. What a great opportunity that agent missed!

"Marketing in the future will be self-selecting, said Jason Mittelstaedt, vice president of marketing for RightNow Technologies, speaking at Gartner's 2006 CRM Summit in London. Mittelstaedt noted that Time magazine's "person of the year" for 2006 was the typical consumer, and yet, many organizations still don't understand how fast their customers are changing. According to Mittelstaedt, 65 percent of customers stop doing business with companies because of bad experiences with a product or service, and 27 percent never return. And yes, this includes contact centers.

Two magic words are all it takes to turn the contact center into the magical place it's meant to be: LISTEN and ASK. Robots do not listen and ask. But humans, even with lots of technology to make their life more efficient, do.

Subliminal impressions drive our thinking

Ever wondered what goes behind people who come-up with great ideas? And do you want to know how their minds work?

It's the subliminal impressions that you pick-up everyday that makes a difference to your thinking. You may never realize what caught your attention but it's there right at the back of your mind. So, train your mind to catch its attention on simple but unusual things that you see around you. Being inquisitive and perceptive, can make a huge difference.

You can't afford to get brain dead, you got to be 'brain agile' every minute, if you want to come-up with some great ideas!

Read more to believe it! Little John helped me learn this today!

Derren Brown is a mind master when it comes to suggesting, influencing, planting and hypnotizing.Our brains are pulling directly from everyday experiences that we aren't even remembering. Our bus ride to work, the lunch line, etc. So, pay a bit more attention to that boring stuff around you.

Home or work - Rules are the same!

Read an extremely good article in ET friday last. Written by Verne Harnish, he says:

What is the underlying handful of fundamentals that drive everything else that’s important in business? What is still fundamental today in building a successful firm that hasn’t changed for over a hundred years? Tom Meredith, former CFO of Dell Computer, and I were discussing how the fundamentals that create a great business are the same as those for parenting great kids.

Anyone with children will recognise the fundamentals as:

• Have a handful of rules
• Repeat yourself a lot
• Act consistent with those rules (which is why you better have only a few rules)

Further, he also quotes from Rockefeller’s leadership and management principles:

Priorities - Does the organisation have objective Top five priorities for the year and the quarter (the month, if growing over 100% annually) and a clear Top one priority along with an appropriate theme? Does everyone in the organisation have their own handful of priorities that align with the company’s priorities?

Data - Does the organisation have sufficient data on a daily and weekly basis to provide insight into how the organisation is running and what the market is demanding? Does everyone in the organisation have at least one key daily or weekly metric driving his or her performance?

Rhythm - Does the organisation have an effective rhythm of daily, weekly, monthly, quarterly, and annual meetings to maintain alignment and drive accountability? Are the meetings well run and useful?

Only if all bosses were so honest and every employee responsive

Read a nice little piece from Seth's blog about a note from boss to his employees. As we talk about collaborative and empowered organizations being the future, this note sets the tone to start the culture today:

1. I am sometimes under enormous pressure from upper management; pressure that you seldom see. Anything that you can do to make my job easier will be greatly appreciated.
2. Your interests are important, but please remember that I also have to juggle the concerns and feelings of a bunch of other people, including individuals outside of the department.
3. I may not have been given a huge amount of training before being named to a supervisory position. As a result, I’ve had to learn through trial and error. That's not always bad. Many of my responsibilities can only be learned through practice.
4. If you are a former co-worker of mine, please recognize that supervising former peers is one of the toughest jobs any supervisor faces. The support that you give me is crucial.
5. I will make mistakes. Please give me the same understanding that you’d like me to give you when you blunder.
6. If I do something dumb or am on the verge of doing so, please tell me. Don’t hint. Tell me.
7. I don’t like unpleasant surprises. Let me in on bad news as soon as possible. (Things that you believe are obvious may not be that clear to me. On the other hand, you'd be surprised at how quickly the latest gossip reaches my ears.)
8. I expect you to take initiative. If you keep bouncing things to me, I’m going to wonder why I have you around.
9. You should ask questions if you don’t know what to do. On the other hand, you should not have to be taught the same thing over and over again.
10. Let’s respect each other’s time. We each have a job to do and the more we can reduce unnecessary interruptions, the happier we'll each be.
11. Don't let all of my talk about meeting goals and producing results lead you into unethical behavior. You always have my permission to be ethical.
12. If either of us has a problem with the other's performance, let's talk about it.

What does it take to be customer-centric?

Many a times, it is easy for companies to talk about being customer-centric, customer-focussed etc. But, it needs the right attitude and mindset in people who work for the organization, to make it happen on the ground.  Here's a set of rules from a book called Exceeding Customer Expectations and I found them to be an extremely useful list to remember and practice everyday.

I also feel this is an important checklist against which you could rate the people who you would like to recruit. Check out what they feel about these rules and some examples of where they have practiced it in their eariler jobs! Without wasting anymore time, here's the list:

1. A passion for taking care of customers.
2. A willingness to be flexible.
3. A work ethic based on dedication to the company and its mission.
4. An eagerness to learn a new business and work their way up.
5. Self-motivation and goal-orientation.
6. Persuasive sales skills.
7. Excellent communication skills.
8. Leadership ability.

Smashing the clock!

On-demand customers are changing the way companies are transforming the workplace. Business Week has an interesting article on how Best Buy is responding to this challenge:

The nation's leading electronics retailer has embarked on a radical--if risky--experiment to transform a culture once known for killer hours and herd-riding bosses. The endeavor, called ROWE, for "results-only work environment," seeks to demolish decades-old business dogma that equates physical presence with productivity. The goal at Best Buy is to judge performance on output instead of hours.

Another thing about this experiment: It wasn't imposed from the top down. It began as a covert guerrilla action that spread virally and eventually became a revolution. So secret was the operation that Chief Executive Brad Anderson only learned the details two years after it began transforming his company. Such bottom-up, stealth innovation is exactly the kind of thing Anderson encourages. The Best Buy chief aims to keep innovating even when something is ostensibly working. "ROWE was an idea born and nurtured by a handful of passionate employees," he says. "It wasn't created as the result of some edict."

So bullish are Anderson and his team on the idea that they have formed a subsidiary called CultureRx, set up to help other companies go clockless. CultureRx expects to sign up at least one large client in the coming months.

Then again, the new work structure's proponents say it's helping Best Buy overcome challenges. And thanks to early successes, some of the program's harshest critics have become true believers. With gross margins on electronics under pressure, and Wal-Mart Stores Inc. (WMT ) and Target Corp. (TGT ) shouldering into Best Buy territory, the company has been moving into services, including its Geek Squad and "customer centricity" program in which salespeople act as technology counselors. But Best Buy was afflicted by stress, burnout, and high turnover. The hope was that ROWE, by freeing employees to make their own work-life decisions, could boost morale and productivity and keep the service initiative on track.

It seems to be working. Since the program's implementation, average voluntary turnover has fallen drastically, CultureRx says. Meanwhile, Best Buy notes that productivity is up an average 35% in departments that have switched to ROWE. Employee engagement, which measures employee satisfaction and is often a barometer for retention, is way up too, according to the Gallup Organization, which audits corporate cultures.

A Presumption of Imperfection

If you want to build a truly customer-centric company, there is a thing or two to learn from Toyota. Kevin Meyer writes about Toyota's philsophy of ' A presumption of imperfection':

Although their sales, profits, and market share are increasing at the same time GM and the rest of the big three are in a tailspin, there is reason for them to be concerned.  Over the past ten years they have reduced the average number of hours it takes to build a car from 21.6 to 21.3 while GM has reduced from well over 30 to about 23.  Rapid global growth has led to design flaws leading to quality problems.  An internal study a couple years ago found that Toyota paid more for almost half its parts than other car companies, a conclusion that Mr. Watanabe found "outright humiliating" and "unacceptably mediocre."

You can get a sense for how much they worry when they are willing to question - and change - even the most fundamental reasons for their success:

Within the company , he [CEO Katsuaki Watanabe] has even questioned a core tenet of Toyota's corporate culture - kaizen, the relentless focus on incremental improvement.

Mr. Watanabe wants kakushin, or revolutionary change.  He wants to cut the number of components in a car by half and create a new generation of fast and flexible factories to build these cars.  Just think about that challenge for a moment... cutting the number of components by half.

At Toyota there is a presumption of imperfection.

No one at Toyota Georgetown can talk about his work without explaining how it has just changed, or is about to change. Simply working at Toyota transforms even your home life.  Consider Howard Artrip...

The way he does his work is so compelling it has become part of his personal life. "When I'm mowing the grass, I'm thinking about the best way to do it. I'm trying different turns to see if I can do it faster," he says. He has analyzed his morning routine. "I do the same standardized work in the shower every morning. I have to get here at 6 a.m., and I know it takes 19 minutes, including walking into the plant." He smiles. "I've maximized my sleep time."

Inspiring stuff!

Customer-Centric Companies and customer management blues!

I often wonder how to get my organization aligned to customers and get all employees to have shared goals. I realize that it is far easier said than done. Getting an alignment across the entire organization is what I have to come believe is the key difference between the best customer-centric companies and the worst ones. We read a lot about Starbucks, Whole Foods etc. but  what make them the companies that they are?

Transparency amongst employees  is what I feel is the most critical.  The other one is having a fair compensation across various levels in the organization. The US companies seem to have lost the plot on this. John Mackey, CEO of Whole Foods has an excellent post on compensation. He writes:

The second part of today's announcement has to do with my own compensation. While it has become necessary to raise the salary cap at Whole Foods to help ensure the retention of our key leadership, this is not true in my case. The tremendous success of Whole Foods Market has provided me with far more money than I ever dreamed I'd have and far more than is necessary for either my financial security or personal happiness. I continue to work for Whole Foods not because of the money I can make but because of the pleasure I get from leading such a great company, and the ongoing passion I have to help make the world a better place, which Whole Foods is continuing to do. I am now 53 years old and I have reached a place in my life where I no longer want to work for money, but simply for the joy of the work itself and to better answer the call to service that I feel so clearly in my own heart.

As you can see from the following chart, the average CEO received 431 times as much as their average employee received in 2004, while the Whole Foods Market CEO (me) received only 14 times the average employee pay in cash compensation.

Most large companies also pay their executives large amounts of stock options in addition to large salaries and cash bonuses. However, this is not the case at Whole Foods Market. As the chart below indicates, the average large corporation in the United States distributes 75% of their total stock options to only 5 top executives with the remaining 25% going to everyone else in the company (actually most of the remaining 25% goes to the next level of executives below the top 5). At Whole Foods, the exact opposite is true: the top 16 executives have received 7% of all the options granted while the other 93% of the options have been distributed throughout the entire company with all Team Members eligible for a grant after 6,000 hours of service to the company

When you have such values and belief in the business that you lead and are willing to share this transparently with your employees, it  definitely shows in the way they treat their customers!

Have you made a mistake lately?

I often see people in a state of intertia and inaction because they are afraid to make mistakes. They don't want to look stupid and ignorant. I don't see anything wrong if one makes a mistake. Organizations suffer from poor customer interactions because of such people. They neither take action nor learn from others. Hence, they leave a lot of customers dissatisifed.  Jeffery Philips has an interesting post on the same:

When you are right no one remembers, and when you are wrong no one forgets.  There is so much fear in many organizations about being wrong - on the wrong side of a decision, backing the wrong manager, making a big mistake - that often any action that does happen happens either automatically (transactional stuff) or because we've back ourselves into a wall from a time or budget standpoint and just have to make a decision.

Some of this thinking springs from the mythos that really smart people don't make mistakes.  I think that's wrong.  I think really smart people make mistakes, they just learn and adapt a lot more quickly than others do, and they find ways to mitigate the outcomes of those mistakes.  It has been frequently said that Edison knew 1000 ways not to make a lightbulb.  Edison didn't invent the bulb, or the electric light.  He actually dramatically improved the longevity of the bulb and how the bulb and the electrical socket (and eventually electrical distribution) would work.  But only after trying thousands of combinations of filaments and bulbs.  This record of experimentation and failure gave him a great base of knowledge and helped increase the odds of success.  What's not so well known is that Edison championed direct current (DC) power rather than alternating current (AC) and so lost the advantage to others in the long run on electricity distribution.

Being wrong isn't the problem.  Being wrong consistently is a problem....

Enjoying what you do

There is an interview with Bruce Smith, Chairman and Chief Executive of Tesoro Corporation in NY Times. He makes an interesting point about work and to me this is so true what makes successful people and great coporations:

"One thing I tell my sons today — I now have five sons — is, do something you enjoy and you’ll never work a day in your life. I believe that when it stops being fun you have to look for something else."

When do companies take passion out of their employees?

Customers will see them through first ( eg. not keeping-up their word, treat their request as obligation, hear a lot of excuses!!!) before the bosses know what happened! Read more

The 43-Hour Day!

Global families today are harnessing pervasive technology and media to help them manage busy households and achieve more balanced, satisfying lives, according to research released today by global Internet company Yahoo! Inc. and OMD, a worldwide media communications specialist.

The Yahoo!/OMD study shows the power of multi-tasking in extending the typical day's activities beyond 24 hours. In the U.S., respondents listed, on average, a total of more than 43 hours of daily activities, including time spent sleeping, working, commuting, as well as technology/media-based activities such as emailing, using an MP3 player, text messaging, and watching TV.

The research project combined results from polling more than 4,500 online families in 16 countries with in-home interviews and scrapbooks tracking media and technology usage by families in seven countries. Consistent themes include a resurgence in traditional values, and recognition that the "always on" nature of technology highlights the need to also focus on low-tech activities such as playing board games and dining together

• Nearly three quarters (73 percent) of families with children said it is important to eat dinner together each day.
• Eight out of 10 adults said they "enjoy spending time with their family." This number increases to nine out of 10 among those married with children.
• Average global family owns 11 technological devices (12 devices in the U.S.), creating concerns about information overload while enabling better communications
• 70 percent of global survey respondents agreed that technology allows them to stay in touch with family
• 29 percent of parents said that they use mobile phones to keep in touch with children throughout the day
• 25 percent of parents said instant messaging has helped improve relationships with their children.
• Only a third (31%) of U.S. parents believe their children fail to spend enough time outdoors or playing sports -- compared to 41% of parents in Taiwan, South Korea and India, and almost two thirds (63%) of parents in China.

Family 2.0

"Family 2.0 isn't the Cleavers of the 1950s or the futuristic Jetsons. Today's men cook, women work, and kids often are very tech-savvy," said Michele Madansky, vice president of sales research, Yahoo!. "Father doesn't always know best. He may not have a clue about what MP3 player is the best value, but daughter can be the expert because she has spent time online comparison shopping prices and features."

Corporates have a new playbook

	New Rules	vs.	Old Rules
1	Agile is best; being big can bite you.		Big dogs own the street.
2	Find a niche, create something new.		Be No. 1 or No. 2 in your market.
3	The customer is king.		Shareholders rule.
4	Look out, not in.		Be lean and mean.
5	Hire passionate people.		Rank your players; go with the A's.
6	Hire a courageous CEO.		Hire a charismatic CEO.
7	Admire my soul.		Admire my might.

Read more

Nike's principles

1. Our business is change
2. We are on offense. All the time
3. Perfect results count. Not a perfect process. Break the rules. Fight the law
4. This is as much about battle as about business
5. Assume Nothing - Make sure people keep up their promises, Push yourself; Push others, Strech the possible, Expect success - always
6. Live off the land
7. Job isn't done until the job is done
8. Dangers - Bureaucracy, Personal ambition, Energy takers vs Energy givers, Knowing your weakness, Don't get too many things on a platter
9. It won't be pretty
10. If we do the right things, we'll make money damn near automatic

             Thanks - Henry Lambert

    

How do you recruit tech geeks?

Only a challenge will get them excited. Only a project can  keep them motivated. Pose them a problem and they will get into action immediately. Also, the best of the geeks thrive by competing.

So, calling for interviews thro' recruitment ads may not be the best way to recruit. That's an old world model. You will get tons and tons of resumes but the best ones may not apply. The best way is get them to do some coding. Challenge them within a group. Pick the best out of the lot and get them to work for you.

This is exactly the way Google is doing it in India.  It's called The India CodeJam.

Here's the prize money if they participate and win!

Competitor(s)	Prize
First Prize	Rs. 122,000
2nd - 5th Place	Rs. 56,000
6th – 10th	Rs. 44,200
11th – 20th	Rs. 33,200
21st – 25th	Rs. 22,200
26th – 50th	Rs. 18,000
* Winner must be present at the onsite round to receive prize.

There are many of them already participating. See for yourself.

Learning from great leaders - HOW I WORK

Fortune has a great piece on how great leaders work - How I work.

Sure, each one of us can pick-up a tip or two from each one of them.

How to be smarter at work. Slack off

Very nice article from CNN Money. It's important to focus, spend time on a problem, have some freedom and space to work smarter.

Here are some excerpts:

In a world of too much work and too much multitasking, the best way to beat the competition may be to do less.

But it's really, really hard, if not impossible, for the human brain to come up with fresh new ideas when its owner is overworked, overtired, and stressed out.

Sooner or later, companies' performance has to reflect that, Capelli says. "On the organizational level, what you get is, everyone is so focused on running flat-out to meet current goals that the whole company is unable to step back and think."

Indeed, "the notion that busyness is the essence of business can only do us long-term harm," writes consultant Tom DeMarco in a book called Slack: Getting Past Burnout, Busywork, and the Myth of Total Efficiency.

"Companies need to respect the time it takes to do strategic thinking," he says. "Task-oriented thinking is important too, of course. But bigger thinking is slow."

The late Peter Drucker agreed. He wrote in The Effective Executive (an eerily prescient 40 years ago), "All one can think and do in a short time is to think what one already knows and to do as one has always done." Gulp.

What scienti