Wednesday, February 28, 2007

The 7 customer rules are for B2C, too

In our new book, Achieve Sales Excellence, Howard Stevens, the CEO of The HR Chally Group, and I describe the 7 customer-defined rules that govern sales excellence in the B2B environment. Buddy LaForge and Larry Chonko, marketing professors at the University of Louisville and Baylor University respectively, as well the Academic Forum columnists for Direct Selling News, just took Howard's rules a step further by applying them to direct sales in the B2C world. It's great that the rules make sense for direct sellers too and that LaForge has adopted the book in his Advanced Professional Relationship Selling class. My mom, however, might have something to say about my new name. Theodore Zinn?

Tuesday, February 27, 2007

The bad news about job satisfaction

Last Friday, The Conference Board released its latest findings on job satisfaction. It reported that less than half of us are satisfied with our jobs. Unsurprisingly, the numbers drop lower among workers under 25, those earning under $15,000/yr, and those who work where I grew up -- the congested, expensive, and stressful NY, NJ, PA tri-state area.

What is surprising is that 61% of us, substantially more of us than today, were satisfied with our jobs 20 years ago. That was 1987, which, by the way, wasn't all that great a year. As I recall it, the real estate and stock market bubbles were bursting, the industrial heartland was still rusting, and we were flirting with recession. It was a lot like today actually.

What is different is that we have been subjected to a barrage of empowerment, teamwork, recognition, and my personal favorite, 'fun at work' schemes since 1987. I've seen a library's worth of books on these topics and I've contributed to their dissemination, too. Nevertheless, job satisfaction is dropping, not rising.

That suggests a couple of possibilities: Maybe employers are just paying lip service to all these ideas for making work fulfilling or maybe all that stuff just doesn't matter much in the real world. It sounds like a coin flip to me.

Monday, February 26, 2007

Corporate communiques #1: Howard Schultz

I've been collecting memos, open letters, and other corporate communiques. I know, it's not as exciting a hobby as rock climbing or cave diving, but I'm thinking that I'd like to build a book around them. Messages -- good, bad, and sometimes just silly -- that changed people, companies, industries, even history. Messages like Alfred Sloan's "Product Policy Letter of 1921" that laid out his innovative plan to create cars for every market segment and Robert Wood Johnson's "Industrial Credo" that became the basis for Johnson & Johnson's ethics policy and Bill Gates' whiny "Open Letter to Hobbyists" that said sharing software was stealing and Sherron Watkins' anonymous memo to Ken Lay that became a smoking gun at Enron.

I just added Starbucks chairman Howard Schultz's 'commoditization' memo of Feb 14th to my collection. Somebody leaked it to the Starbucks Gossip blog. Great tagline there: "Monitoring America's favorite drug dealer." Anyway, I like the memo 'cause Schultz questions how and where the company has been drawing the line between cost effectiveness and customer experience and with what results. It's a great question that speaks directly to my experiences with the company as a customer.

Living in a small town, I was late to the whole Starbucks thing. You could get Starbucks coffee on the William and Mary campus, but the company didn't open a real store here until a couple of years ago -- long after we had a half dozen other independent and franchised coffee shops. Maybe that's why I've never really understood why people were crazy for Starbucks. It has never seemed any different than any of the other java stops in town -- same line, same choices, same taste, same price. So I stop at Starbucks when it's convenient and stop at the other places when I'm closer to them.

That's exactly the commoditization problem that Schultz is pointing out: why will people bother to get their coffee at Starbucks when it's just another coffee shop?

Sunday, February 25, 2007

Get an agent

After the self-publishing question (which I answered a couple of weeks ago), the next most common query I get from wannabe business authors is whether they need to hire a literary agent to get published. Strictly speaking, the answer is no. You can pitch and sell your own manuscript and/or proposal. (It's especially easy if your book is good, by which I mean it's clear that the book will sell a lot of copies.) But get a good agent anyway. Here's why:

One, agents provide authors with a critical early take on a book's potential in the marketplace. Better an agent tells you your book is a waste of paper than a publisher. You've lost nothing -- agents don't acquire books. Better yet, ask why and you may get valuable advice about how to make your book more marketable.

Two, publishers see agents as early indicators of a book's potential. Publishers know that agents earn commissions on advances and royalties. They also know that it doesn't makes sense for agents to invest time in authors and books that won't produce commissions. Ergo, if an agent is pitching a book, at least someone besides the author thinks there is some value in it.

Three, it's highly likely that publishers will pay more for your book if an agent is pitching it. Agents know all the publishers worth knowing and can get to them; you probably can't. Agents know who's buying and who's not in the constantly shifting marketplace; you probably don't. Agents know the going rates and when a publisher is undervaluing a book; you probably don't. Agents can aggressively negotiate without jeopardizing the deal or the ongoing author-publisher relationship; you probably can't.

Four, agents know book contracts. Most publishing contracts are filled with clauses that serve the publisher at the author's expense -- unpaid options on your next book, copyrights in the publisher's name, lousy royalty rates, collateralization clauses (in which some publishers will try to satisfy the advance on your previous books with your future books), etc, etc. All publishers call their contracts "standard" and act as if they are written in stone. Agents know what is and what isn't written in stone; you probably don't.

There are more reasons to get an agent, but that's enough for now. We'll take up how to get a good agent in a future post.

Friday, February 23, 2007

Patent management for fun and profit

The big news of the day is Anna Nicole Smith's final resting place, of course, but yesterday's $1.52 billion judgement against Microsoft, a record-setting award for a patent infringement case, is also of some note. Alcatel-Lucent picked up this tidy piece of change for two patents that were filed when Bell Labs was developing MP3, the now ubiquitous digital music format, almost 20 years ago.

Microsoft thought it had licensed all the rights it needed to use the format from Bell's partner in the original MP3 research consortium, Germany's Fraunhofer Institute. Unhappily for them, it turns out that Bell had a couple of earlier, related patents stashed in its back pocket and somebody who was really on the ball figured out that Alcatel-Lucent now owned them. Now, everyone else who is making MP3 players -- surprise, Apple -- may also have to pay homage.

One person this story won't surprise is M. Henry Heines, whose new book with its oddly arresting cover art, Patents for Business, was just published by Praeger. Heines, a partner in the San Francisco law firm Townsend, Townsend, and Crew, wrote the primer specifically for managers because:

Regardless of the nature of one's business, a strong patent portfolio gives a business entity a value that far exceeds the entity's net book worth. A strong patent portfolio also provides leverage and a strong bargaining position in negotiating joint ventures and strategic alliances, generating licensing revenue, and attracting investors. These transactions and the decisions that control and direct them are made by management, not patent attorneys.

Thursday, February 22, 2007

The not-so-big story on email

The spate of recent stories which have referenced new research into the pitfalls of communicating via email conducted by Syracuse University's Whitman School of Management asst professor Kristin Byron made me curious enough to take a peek behind the press release. It turns out her research is a theoretical model derived from her study of “computer-mediated and nonverbal communication, emotion, and perception literature.” It’s titled Carrying Too Heavy a Load? and will be published by the Academy of Management in January ’08.

The gist of the study is a set of theoretical propositions derived from Byron’s review of the literature. She proposes:

  • That we read email thru a lens, darkly -- messages intended to be positive are likely to appear neutral and messages are likely to appear more negative than intended;

  • That this effect is magnified when the messages come from males, senders of high status (like your boss), or people with whom you don’t have well-established relationships;

  • That this effect varies by the age (young people read more negative emotion; old people read positive as neutral) and the mood of the reader (bad moods means negative interpretations);

  • That message rules and emoticons can dampen the effect by creating a shared context.

There’s no proof here, but I’ve had enough run-ins over misread emails that I'm not surprised by Byron’s conclusions. The big question in my mind is what can you do to minimize the likelihood of your own emails being misread.

Unfortunately, Bryon doesn’t offer many answers. First, she says, “recognize the possibility that, as the model suggests, we are fallible as both email senders and receivers.” Then, “use established, shared cues to communicate emotion” and "[seek] clarity by repeating important information or by asking for feedback [to] more accurately express emotions.”

Wednesday, February 21, 2007

Don't like it? Don't do it.

Marcus Buckingham’s new book, Go Put Your Strengths To Work (Free Press), arrived the other day. I interviewed him for an article in Selling Power about this time last year, as he was driving his kids to the San Diego Zoo. I wanted his advice on how to sustain peak performance. He said:

If you want to experience and sustain levels of personal best, then you have got to find out what you don’t like doing and have the discipline to cut that out of your life. The funny thing about success, initial success, is that it brings with it more opportunities, more complexities, more choices. Some of those are going to play to your strengths, but many of them won’t. And if you are not quite careful, you may well end up spending a disproportionate amount of your time doing things you really don’t like to do. So the trick is to have the insight, first of all, to identify which things grate on you or frustrate you or drain you and then, have the creativity and the discipline to cut them out of your life.

Buckingham’s new book offers a process for achieving that insight and discipline. It’s something of a multimedia extravaganza; each copy includes a personal code for an online Strengths Engagement Track assessment and access to downloadable, filmed versions of the first two chapters of the book. Buckingham’s process is also the subject of a one-hour PBS special airing in March.

Monday, February 19, 2007

A rhetoric primer worth reading

In researching a book round-up article on communication effectiveness for Harvard Management Update, I got a chance to consider Alan Axelrod's newest book. Alan is a prolific business author. I'm a great admirer of his energy and his practical, accessible style. In fact, we borrowed the lessons format he put to such good use in books like Patton on Leadership for our book on Douglas MacArthur (which he graciously endorsed, nevertheless).

I didn't know that Alan was formerly an English professor who taught classical rhetoric until I read the cover copy on Getting Your Way Every Day. I'm just a couple chapters into the book, but it's already clear that the art and science of persuasion didn't start with Gerry Spence.

It's also clear that in addition to thoroughly understanding the great rhetorical thinkers, Alan has successfully translated their ideas into modern terms. For instance, if you had asked me what exordium, narratio, confirmatio, refutatio, and peroratio meant yesterday, I would have suggested it was a spell for curing a bad hangover. Turns out it's the Roman prescription, based on Aristole, for building a compelling argument, which Alan translates into: take a bow; give 'em the facts; confirm this; refute that; and, wrap it all up.

If you've ever struggled through the classics, a task I periodically and fruitlessly attempt in the vain hope of bettering myself, you'll probably find this a welcome addition to your reference bookshelf, too. (Sample chapter here.)

Sunday, February 18, 2007

Dinner with His Excellency

Choosing to move to Williamsburg a decade ago is a decision that we've never had great cause to regret. We live within the city limits, walking distance from the College of William and Mary (great library and fitness center) and Colonial Williamsburg (great no-car zone and just $10 for the annual resident's pass).

Our neighbors are friendly; the taxes are astonishingly low; the climate is moderate, except for a month or so of cold and another month or so of hot-house humidity. And where else would we regularly run into Thomas Jefferson -- yea, that Jefferson -- coming out of the post office?

Last night, we had dinner with George Washington -- yea, that Washington -- at Christiana Campbell's Tavern, our first president's favorite place to dine in town. He seems to tolerate the position of chief executive well, but he complained about the rigors of serving in New York City, where he gets an overwhelming number of invitations to social events. It seems his wife Martha prefers the quiet life.

Washington also mentioned that he has had his fill of sitting for portraits. His favorite portrait, by the way, is this one by William Joseph Williams. A Masonic Lodge asked him to sit for it and he agreed only on the condition that it be as fully honest an image as the artist could make. Apparently, overly-aggressive retouching is a real problem among portrait painters.

During the course of the evening, I got a chance to ask Washington what qualities he thought were important in those who would succeed him as head of our government. He said the most important was the ability and willingness to listen to the counsel of others before coming to a major decision, particularly when that counsel was disagreeable. Towards that end, he is in the process of appointing secretaries who will advise him on the specialized issues of the day. He hopes Jefferson will accept the position of secretary of state. I wonder if that means we won't be running into Tom around town for a while?

Saturday, February 17, 2007

Scavenging at the SEC

I know that reading 10-Ks and Qs and all the other forms that the SEC requires public companies to file can be deadly boring, but they are also a rich and free source of story leads and investment info. For the raw materials, just click over to Edgar Online, the SEC's database of filings, enter your corporate target's name, and start downloading.

Interpreting the filings is labor intensive, so it pays to get a little education first. If you are a business writer, visit the National Center for Business Journalism and check out their free workshops and online seminars. The week-long, online 'Boot Camp' seminar taught by Chris Roush, asst professor of journalism at UNC Chapel Hill, is a great intro to ferreting through corporate filings.

If you aren't a journalist, get one of the many books on reading corporate financial reports. Michelle Leder's Financial Fine Print is a readable and uncomplicated place to start. And to get a better idea of why it pays to know how to read SEC filings, you also might want to start reading Leder's blog You'll be surprised at the stuff she digs up.

Friday, February 16, 2007

More on economic hit men

John Perkins' Confessions of an Economic Hit Man was a disturbing and intimate view of the true intent and tragic consequences of the 'aid' we offer emerging nations. If you haven't read the book, which was on the NYT's bestseller list for over a year, you should. If you don't have the time, check out this wonderfully caustic summary -- it'll only take a minute.

The sales of Perkins' confession (over a half-million copies) ensured that we would be hearing more on this subject. And so we are. Perkin's publisher Berrett-Koehler just released a follow-up titled A Game as Old as Empire, a collection of a dozen more examples of the impact of political and corporate scheming on already-struggling nations edited by Steven Hiatt.

Perkins contributed the introduction to B-K's new book, but soon will be competing with his former publisher -- the only one he could find willing to take on Confessions. His second book, The Secret History of American Empire: Economic Hit Men, Jackals, and the Truth about Global Corruption, is due out this summer from Dutton.

Thursday, February 15, 2007

Struggling to maintain the Toyota Way

The last time that American auto makers were in this much trouble, their managers flocked to Japan to learn the quality secrets of Toyota. Oddly, instead of raising the drawbridge before the invading horde, the Japanese opened their plant doors wide and showed their competitors exactly how they were able to produce high quality vehicles at reasonable prices.

Why were the Japanese so obliging? I think it's because they realized that successfully copying the Toyota Production System required fundamental cultural and behavioral changes that the American car companies and their employees might never accept.

This morning, Toyota is the subject of a very interesting article in the New York Times. The company is now the second largest car maker in the world and is threatening to overtake GM. It is a corporate giant with plants around world...and guess what? Now, it's having problems transplanting its own system in some of the countries in which it operates.

The Times article suggests that this is because the "Toyota Way" has only recently been codified. Now, NYT reports, Toyota is writing it up and teaching it in its corporate university in order to ensure that its managers and workers around the world learn it. (In fact, that's not really accurate -- the tenets and methods of the Toyota system are well known and have been available to anyone who wants to learn them for going on 20 years. Check out titles originally published in Japan and translated by Productivity Press, like this one.)

I think the shoe is now on the other foot. The challenge that Toyota is confronting, just like our auto makers did in the late 80s and early 90s, is one of changing the mindsets and behaviors of the people -- execs, managers, workers, suppliers -- who make up their global production system.

Monday, February 12, 2007

Leaders: Beware your inner Dombey

Inspired by a Ron Rosenbaum article reprinted in his massive collection, The Secret Parts of Fortune, I am 700-odd pages into Charles Dickens’ Dombey and Son and particularly engrossed with Mr. Dombey himself, the very chilly patriarch of the troubled and fast-dwindling family. In fact, except for a sycophantic sister, Dombey is pretty much on his own these days. His first wife and young son are dead; his daughter and second wife have fled his house.

Dombey, the head of prosperous London counting house, is a man consumed by his own power, position, and wealth. Here’s how Dickens has Carker, Dombey’s second-in-command and the novel’s chief villain, describe him:

“You did not know how exacting and how proud he is, or how he is, if I may say so, the slave of his own greatness, and goes yoked to his own triumphal car like a beast of burden, with no idea on earth but that it is behind him and is to be drawn, over everything and through everything.”
There’s a depiction of a major source of executive hubris that is as applicable today as it was in London 160 years ago.

Sunday, February 11, 2007

E-reading has arrived…finally

I didn’t pay much attention when the new generation of e-book readers began arriving. I thought they would quickly join all of the other gizmos, which tried to wean me off real books over the past decade, in the Mausoleum of Digital Junk. Then Sony sent me their PRS-500 Portable Reader System for a test drive.

The Reader is small, about the size of a thin paperback. It weighs about 9 oz – nice heft, but not uncomfortable to hold for long periods. The standard cover is great; the optional $149 Dooney & Bourke leather cover is just silly. The lasting power of the rechargeable battery is incredible; the power indicator has moved down one bar after a week of reading sessions. It took a couple of hours to charge when it arrived and Sony says it will last 7500 pages turns before needing another.

The E Ink screen is a wonder, especially in comparison to the screens on all the now-extinct readers. It’s readable in all kinds of light and at any angle. I haven’t gotten any eyestrain from it at all. Based on technology developed in the MIT Media Lab, these screens are a big reason why the new generation of readers might actually start replacing books. The Sony has a six-inch screen, which works all right. If I had a choice, I’d prefer a larger screen. In fact, I wouldn’t mind a reader about the height and length of a hardcover.

The controls are simple and adequate. My technical aptitude is average at best and I had it mostly figured out without reading the manual. Sadly, you can’t search or highlight or enter notes (or delete a file without having to connect Reader to your computer), but you can navigate a book fairly quickly and the bookmark button can get you back to an important passage.

There is enough memory to store about 80 books, according to Sony. You can add a memory card, but I wouldn’t bother because navigating a huge library on Reader would get cumbersome. I’d keep a stack of books on the Reader and the rest of the library on my computer.

The Reader itself is a pleasure to use, but filling it with everything you might want to read is where things get more difficult. If you download all your reading from Sony’s CONNECT ebooks site, everything comes formatted to order (and at a price). But, to me, a major selling point for this reader is its ability to display a variety of document formats.

The problem is that this takes more expertise. For instance, since I was reading Dickens’s Dombey and Sons when the Reader arrived, I figured I would download it and compare the reading experience. But when I downloaded the book from Project Gutenberg to the Reader (via by my desktop), the formatting did not transfer properly. Every sentence had a hard return at the end. It seems that I could have reformatted the file myself using MS Word, but happily, I found (an essential community if you are considering joining the ranks of e-readers) instead. A forum post there directed me to, which allowed me to download books in variety of formats, including Sony’s. The new file read perfectly.

Reading PDF files, which is the second most important use of the Reader for me, is more problematic. I downloaded Counterinsurgency, the new manual from the U.S. Army, but couldn’t enlarge the text enough to read it. Apparently there are ways that users can reformat these files themselves and I’d have to learn how to do that. Hopefully, Sony will address the problem for me.

The Reader, by the way, can also play MP3 audio and display photographs, although I’d rather Sony had eschewed these functions and redirected the extra effort to the reading experience or to reducing the price. In fact, I’d run out and buy a Reader right now…except for the price.

Retailers are selling the Reader for about $350 and I’m cheap. Yeah, I’d eventually make it up in book purchases. I paid $9 for Dombey and Son in trade paper and got the e-book for free, but my wallet clamps up at this price tag. I would jump at $199 and wait outside for the store to open at $149.

The bottom line: Sony done good. I like using the Reader and would use it whenever I could I get what I want to read into it. Since that leaves price as the only major barrier to becoming an e-reader left for me (or preferably some smart electronics company) to overcome, I’d say e-reading has actually arrived this time.

Saturday, February 10, 2007

An inquiry into hot spots

Lynda Gratton's application of the concept of a "hot spot" to corporations is an intriguing explanation for how ordinary organizations sometimes produce extraordinary results. A Hot Spot is a confluence of people and conditions that the London Business School professor introduces like this:

You always know when you are in a Hot Spot. You feel energized and vibrantly alive. Your brain is buzzing with ideas, and the people around you share your joy and excitement. These are times when what you and others have always known becomes clearer, when adding value becomes more possible. Times when the ideas and insights from others miraculously combine with your own in a process of synthesis from which spring novelty, new ideas, and innovation...
This sounds lovely, if rather oblique in terms of management. However, Gratton does ground her thinking in research and cases, including BP, Nokia, OgilvyOne, Linux and the open source movement, and DEC. She also shows why it is in a leader's interest to foster the creation of such spots. Hot Spots, it turns out, are "marvelous creators of value."

Unfortunately, you can't simply solve whatever challenge you currently face by ordering up a Hot Spot. Instead, you have to create an environment in which a Hot Spot can emerge. Gratton offers a formula for this:

Hot Spots = (Cooperative Mindset x Boundary Spanning x Igniting Purpose) x Productive Capacity
I'm particularly interested in the book because it may help explain the success of the Apollo space program in the 1960s. Certainly, all of the conditions in Gratton's formula were in place and when you read the memoirs and oral histories of the people involved, they often describe their work in the same terms that she uses to describe being inside a Hot Spot. You can read Chapter One of Hot Spots here.

Thursday, February 8, 2007

The case against self-publishing

I got another self-published book that somebody sent in hopes of a review. On my way to the discard pile (that's where about 99 percent of the self-published books I receive end up), I noticed an obvious typo in the subtitle on the cover. Yikes.

I understand why self-publishing seems like a viable option to so many business writers. They've heard the horror stories about publishers -- crappy contracts, marketing, sales, cover art, titling, editing, proofreading, yada, yada, yada. They've heard a story or two about a very successful self-published book. They want more control over a publishing process that will yield a finished book faster. I get it, but I still think self-publishing a business book only makes sense if your book has been rejected by every mainstream publisher in the country.

The primary reason I say that is because self-published books lack credibility. It is difficult to get the business press and reviewers to pay attention to a self-published book. They are being bombarded with books from 'real' publishers and they know that the odds of getting high-quality content in a self-published book are not very good. (Witness my discard pile.) Further, many business readers feel the same way.

Another reason is cost. Sure, a self-published author can make more money on book sales (...if the book sells). But there are lots of 'ancillary' fees associated with self-publishing, like editing, proofreading, layout, storage, etc., etc. In terms of net profit or loss, a business book author is almost always better off negotiating a reasonable advance, royalty rate, and author pricing with a trade publisher.

And finally there is distribution. Unless you feel like getting a part-time job, you really don't want to distribute your own book. Some self-publishing outfits will help authors distribute their books, but there will be more fees for those services. A conventional publisher already has a distribution pipeline. In fact, that's what they really do well because that's how they make money -- pushing product through the pipeline.

So, get a conventional publisher and, like every other author since Gutenberg invented the printing press, complain about it. There's no reason to mess with tradition...yet.

Wednesday, February 7, 2007

No such thing as bad PR?

Remember Swanson's Unwritten Rules of Management? That's the pamphlet of practical business advice that Raytheon CEO William Swanson and his ghostly editorial minions created a couple of years ago. It became a must-read on the heels of a cover story in Business 2.0 and then, it was revealed that roughly half of Swanson's rules were plagiarized. Scandal ensued, Raytheon was suitably embarrassed, and its Board docked Swanson about $1 million in his next review.

Currency, the business imprint at Doubleday, just sent me a review copy of the 63-year old book that was the actual source of Swanson's wisdom. The Unwritten Laws of Business is a revised edition of W.J. King's The Unwritten Laws of Engineering, a slim volume that has been available for decades to members of The American Society of Mechanical Engineers and anyone else who could be bothered to track it down.

It's a decent book and its basic, simple homilies are not outdated, but the cover copy and the PR accompanying the new edition make the reason it warranted Currency's attention very clear. The front flap opens with the scandal and the headline on rear jacket reads: "The bestselling business classic that Raytheon CEO William H. Swanson made famous." The 14-page press release devotes only a few paragraphs to the book at hand; the rest is a detailed recounting of the plagiarism supported by documentation. Swanson must be thrilled.

Tuesday, February 6, 2007

I'm not cheap, you're a lousy marketer

Being a dinosaur in terms of technological adoption, I just got a DVR last month. The thing is amazing and the TV moguls and advertisers are right to be frightened of it – I haven’t watched a commercial in weeks. The question is what took me so long to get it?

You might say I’m cheap (it's actually a deep-seated aversion to having my pocket picked on a monthly basis), but I prefer HBS marketing prof John Gourville’s explanation for why I waited years to buy a DVR. In an interview for a story on pricing I wrote for Harvard Management Update a couple of years back, he called it the “TiVo Problem” and said:

TiVo is the kind of thing that if you don’t have it, you don’t understand what the excitement is all about. It’s a difficult value proposition for people to understand until they actually experience the product. You have to have it in your home and experience what it is like and suddenly it changes the way you think about television and entertainment. Once you get it, you can’t imagine living without it.

People are very bad at evaluating things in an absolute sense. So, for instance, there is satellite radio. Many people would think of it as a pretty innovative new product, but what are people going to use as the benchmark? They are going to think about their old AM/FM radio and in their minds, they say, ‘Jeez, radio is free. Why should I pay a subscription to get satellite radio?’ Whatever it happens to be, no matter how new the product, people are going look for some sort of a benchmark.

That is the hurdle that a company has to overcome. It’s the job of the firm, the developers, to communicate what exactly is the value. Why should we be spending $10 a month for satellite radio when AM/FM radio is free? I think what happens with product developers is they often fail to understand the benchmark people are going to use to evaluate the new product.

Gourville, along with Rotman School of Management marketing prof Dilip Soman, also wrote a very interesting research paper on overchoice, which explains why companies can lose sales if they offer customers too much variety.

Monday, February 5, 2007

Failure to fit in

Wal-Mart is in the midst of a messy divorce with Julie Roehm, the Marketing SVP it hired to lively up the brand and after a fast 10 months on the job, unceremoniously fired. Wal-Mart claims Roehm was canned for violations of company policy; Roehm claims that she was a change agent who got chewed up and spit out.

Either way, it's really just another case of Mohammad and the mountain. A successful, high-profile exec takes a job at a new company. Is it incumbent on the exec to adjust his or her style and learn to work effectively within the company or is the company supposed to change to accommodate the exec? If you have any trouble answering that question, try this one: who pays who?

It looks like the courts will end up affixing the damages in the case of Roehm vs. Wal-Mart. But, no matter what corporate craziness occurred along the road (and you can be sure there was some given Wal-Mart's skill at shooting itself in the foot) or what the final decision, it was Roehm who failed to fit in and, like many execs before her, she will bear the brunt of the loss.

By the way, it's not like fitting in at a new company requires a secret handshake that nobody will teach you. There are a couple of great books on the subject. The classic is John Gabarro's The Dynamics of Taking Charge and the other one that I like is Right from the Start by Dan Ciampa and Michael Watkins.

Friday, February 2, 2007

Faith at work

It used to be that devout atheists, a distinct minority in this country, could get some relief at work. Religions, even the Jehovah's Witnesses to whom no doorbell is off limits, practiced a hands-off policy when it came to company time -- giving rise to the so-called Sunday-Monday Gap. Increasingly however, people of faith, particularly Evangelical Christians, are demanding that gap be bridged.

David Miller, the Executive Director of the Yale Center for Faith & Culture, plumbs this demand in his new book. (Chapter One is online here.) He says there are so many people who want to be allowed to openly express and practice their religious beliefs, including proselytizing, at work that it qualifies as a social movement.

I got a chance to interview Dr. Miller for an article on the subject back in 2003. I also got a chance to talk with managers and executives in major U.S. companies, who are encouraging it. People like Tom Muccio, who was running the P&G's Wal-Mart Global Customer Team. He said 80 percent of the several hundred employees in his group participated in religious affinity groups and that P&G's intranet also hosted a Christian e-mail network that encouraged its members to pray for the leadership of the company in their dealing with business and social issues.

"There are a number of Bible studies and/or prayer groups in our office pretty much any day of the week," Muccio told me. "Nobody's pushing it. It's just a group of individuals saying, ‘Hey, do you want to do a Bible study?' That is something that 10 years ago just wouldn't happen in other than Christian companies."

Whether it should be happening now is a question that company leaders are going to have to carefully consider.

Thursday, February 1, 2007

Why weird names work

I interviewed Steve Manning, co-founder of naming firm Igor International (check out their blog), for the article mentioned here yesterday, and he offered this rationale for choosing a name like “Egg” or “Monday” for your business:

"It seems that a good 90 percent of names are based on something that is descriptive of the goods and services, named for the founders, or something that’s a synonym found in a thesaurus. When you make a strategic decision to choose a descriptive name, you are then asking the name to do only one thing for you and that one thing is to communicate the business that you are in.

The problem with that is manifold. One, it puts you in with the other 90 percent of people in your business who are attempting the same strategy and it makes it very difficult for people to distinguish or remember you. Also, I would argue that the descriptive naming strategy rarely even succeeds at the one job you are asking it to do. It still bears further explanation, even something like General Motors. A motor is an electrical device, it’s not even an engine. It could be a lot of things. And thirdly, I would argue that the descriptive naming strategy is completely unnecessary because it’s based on an assumption that somehow people will experience your name without explanatory context, without support. And that is a universe that doesn’t exist.

The logic always is ‘we’ll save money because our name will communicate to people what it is we do.’ The problem is then you have to spend more money trying to get people to remember your name because it is, at that point, very difficult because people are inundated with hundreds of names in your sector that sound very similar. From a branding and marketing perspective, you’ve chosen to put yourself in a hole with everybody else.

A corporation’s tendency would be to go with a name like TransAtlantic Air rather than Virgin because in their minds TransAtlantic Air sounds like a serious player in the airline business. They are appealing to what people have already heard before, which is obviously part of the problem because if you’ve heard it 1,000 times, what is the likelihood of remembering it or thinking that it’s different. As soon as you choose a name like TransAtlantic Air you are setting yourself up for the task of explaining to the world how you are really different than the others even though you immediately pigeon-holed yourself as the same as the others.

When you choose a name like Virgin or Igor or Apple, you don’t have to explain that there is something different going on here. You are demonstrating it. Job done."