LESSONS FROM A CHANGE AGENT

Instigating change to make a substantive impact on a company’s growth trajectory can be an exhilarating experience.  But going from inspiration to material reality is a process rife with opportunity and threat.  These are tough and potentially treacherous waters to navigate, from the politics to the fiefdoms to entrenched thinking and the all too human resistance to change.  If you are a catalyst for change, or seeking to become one, help is on the way. 

My career as a global CMO and a strategic advisor at Chasm Group has taken me to places like Kodak during the 1994-96 transition from traditional to digital photography.  Compaq during the acquisitions of DEC and Tandem, and the turmoil around the HP deal.  Siebel Systems during its meteoric rise to CRM greatness, and its subsequent fall.  IRI, a private equity-backed firm seeking to move from data to decision support systems outside its traditional MRD stronghold.  And many companies seeking to reinvent themselves. I have seen this movie and thought I’d share 10 useful tidbits.  Hope you will share yours.

Don’t use the term “change agent”.  It casts others as veterans who are part of the problem and suggests they’ve been sitting on their thumbs…even if it’s true.

Understand the hunger for change.  If there is no burning platform, you can’t create one operating as a team of one.

Speak about “us”.  Take the Japanese approach of uniting against a common enemy.  And check your ego at the door.  Lavish genuine praise on others, sometimes giving credit where it’s not due.

Find like-minded people.  You will need to enlist the support of others across all levels and departments.  Remember, this is a “we” mission you are embarking on. 

Make sure you understand what win-win means.  It seems obvious that buy-in requires win-win scenarios.  Anyone who will be affected by the changes you are catalyzing must see the personal benefits to them.  WIIFM.

Network like crazy.  Self explanatory.  You need a lot of friends.

Gather all the data and intelligence you can.  Make sure you know the facts and can make a rational, empirically based argument.  You cannot fly at 50,000 feet, and expect to land the plane.

The divine is in the details.  You may know where you want to go, but you’d better know how to get there.

Listen to the philosophy of Bugs Bunny.  You need to laugh when it hurts, and not take things personally.  “pick yourself up, dust yourself off, start all over again”.

Always finish what you start.  If you are embarking on a journey of change, see it through.  This is not something you dabble in.

Go Big or Go Home

Where are all the inspired, brave souls who dare to think big?  In so many large enterprises, the way forward has been to place a lot of small bets, spreading the food to too many seedlings, and praying that something takes root.  It’s like a kid in a candy store…put 12 different candies on the table and ask a kid to pick 4.  They invariably find all of some appeal and try to grab all 12 but cannot eat them all.  Whether lack of doing the proper homework, lack of conviction, short term thinking, poor tradeoff analyses, or risk aversion, the result is always the same…mediocity…or worse.

When I worked for Tom Siebel, the mantra was “go big or go home”.  Do a few things exceptionally well based on the best knowledge at hand, invest the required people and resources, and leap ahead of the pack. Siebel put everything into its partnership with IBM and voila…into the tornado of hyper-growth.  Soon after, Accenture, Cap Gemini, and Deloitte came calling for the same deal.  In this discussion, Apple of course comes to mind. They create a finite set of hot categories, invest aggressively, and offer arguably the best products like iPads and the app store underpinned by iTunes.  Of course, everyone runs to be a part of the winner and a de facto industry standard is born.

In contrast, so many miss the boat sometimes through sheer lack of vision but more often because they fail to go big.  Why Xerox PARC failed to rule the world shows what lack of investment can do.

Geoffrey Moore founder of The Chasm Group speaks of placing a few assymetrical bets among the myriad of potential hits. Companies cannot afford to chase every promising idea, especially when established divisions grab all the resources to sustain mature businesses.  But great leaders make the best educated bets on a very finite set of ideas, pick the horses to back, and invest aggressively.  They go big.  They lead. They inspire. They focus.

Go big or go home.  Good words to live by.

Strategic Planning: Beware Think and Doo-Fus

It continues to amaze me that companies keeping doing the same things in the same way and expect to get better results.  Doing without thinking is easy to fall into where regimented processes lead to regimented thinking.

Take strategic planning.  More often than not, the process starts with the CFO who provides this year’s sales targets and last years’s data to the troops, then asks for a bottom up review of everyone’s resource needs to meet targets, followed by a back and forth tug of war.  Inevitably, the ingoing targets for the new year do not change and the troops who have to meet them are disgruntled and usually fail to make the numbers given inadequate resources in people and money.  Wrong process!

Before getting to operational planning in the guise of strategic planning, one needs to do genuine strategic planning from an outside in perspective.  Start with what categories are we in, and are they growing-flat-declining.  What are the fast growth categories and can we leverage our own capabilities to enter those markets, or buy our way in?  Category Power reflects what’s hot and what’s not.  Don’t invest in what’s not under the guise of fair share allocations.  Market Power reflects your share of a target segment.  Are you in Tier 1 with the winners and seeking to grow there?  Are you in Tier 2 with products that make money but aren’t among the elite?  If so, you need a breakout plan to win your Tier before you compete against the Tier 1 players, as you don’t simply jump tiers.  If you are in Tier 3 which many OEMs are, invest appropriately.  Offer Power asks if you have a breakout advantage with your current product.  For your potential hits, have you differentiated enough?  For  proven hits, have you neutralized your reference competitors’ innovations sufficiently sustain our established differentiation?  And for your product line fillers, have you optimized these to the maximum for gains in resource utilization and cost reduction?

Thinking prior to operational planning is imperative to ensure you are putting precious resources in the right places.  Understanding where the next hits will come from and making assymetrical bets on them with a longer term view may be the correct way to go.  Think and Doo-Fus…don’t let this happen to you.

Back from the Dead

Burroughs-Sperry Rand and Honeywell.  Kodak and Polaroid.  DEC and Wang.  GM, Ford, and Chrysler. Eastern and Northwest Airlines.  Borders, Barnes and Noble, Businessweek and Newsweek. Blockbuster. Companies that were once dominant market leaders who are no longer.  Companies that once operated in cyclical growth markets, where markets are established and mature, and both customers and the categories remain the same.  Power shuffles back and forth among vendors in cyclical markets.

But the pace of change is merciless today, driving secular markets.  In secular markets,  a one time only market expansion occurs when a new category or new class of customers arises.  Usually fueled by technology, these changes require a new set of skills and metrics, and a whole new approach to planning.  Operationally driven planning approaches that look back at last year’s plan, set quotas for the coming year, ask for bottoms up input and reconciliations to form the basis of next year’s plan may work in cyclical markets, but are doomed to failure in secular markets.

The game changers indeed change the game…fast!  Apple, Facebook, and Google are obvious examples of secular market growth.  But what of today’s cyclical growth heroes?

24/7 Wall Street predicts 10 brands that will disappear in 2012.  They are: Nokia, Soap Opera Digest, mySpace, Corn Pops, Sony Ericsson, Sears, American Apparel, Saab, A&W, and Sony Pictures.  Yes, these companies are in trouble.  But are they all doomed, or back they be brought back from the media-pronounced dead?

Many can!  Think back to Cisco and Sybase, Agilent and Cognizant, Autodesk and Synopsis, Rackspace, Adobe, and Qualcomm to name a few.  Rather than doing the same old same old operationally-driven planning, these companies looked outside in.  They aligned around a common vision that meant something to people other than themselves.  They committed to a strategy aligned with a vision.  And they allocated resources in assymetrical ways to create customer success and drive out competitors.

Taking an outside in, market centric perspective, those who will come back from the dead will profile trends and opportunities that can create net new sources of wealth.  They will leverage the 5 hierarchies of power that Geoffrey Moore espouses:  category power, company power, market power, offer power, and execution power.

The most powerful of these is category power, which reflects demand for a class of products/services vs. other classes.  Think smart phones and cloud computing in contrast to desktop computers, email, and wireline phone services. Apple is on a prolonged tear by playing in high growth categories like smart phones, digital music distribution, and tablets.  Could Motorola have developed an iPod-like phone as a follow up to the Razr when it had the technology and know how to do so…well ahead of the iPhone?  Why did HP miss the Internet?  These are great companies with very smart, hard-working people and potentially powerful ecosystems.  Indeed the ties of the past, and doing the same old same old are comfortable but quite perilous pathways in secular markets.

I will talk more of the hierarchy of powers in upcoming blogs but for now, let me posit this.  You can can come back from the dead.  The fate of the “10 brands that will disappear in 2012″ is not sealed.  It will take great leadership and some disciplined strategic planning from an outside-in, market-driven perspective, as well as a willingness to focus investments on innovations likely already in development…making big assymetrical bets.  I was there at Kodak in 1994 when digital imaging was an emerging area but 95% of the profits were coming from film, paper, and chemicals.  Did they bet the farm on digital, or dabble?  History can be a harsh teacher.

Introducing today’s CMO, starring Rodney Dangerfield

Marketing.  Now there’s one of the most misunderstood business functions out there.  Are you one of those folk who, like Rodney, feel at times like “I don’t get no respect around here?”.  The CMO today lives in very sharkey waters, as the Aussies say.

Nice to carry that “C” on your resume or business card, but when things go wrong, marketing is most often the first to blame. When things go right…well…some of you marketers may confront a harsh perception that needs correcting.  After all, sales people sell things.  Product and engineering people build things.  Financial people keep score.  Marketing people?  Ask people in other functions to define what you do, and you’ll get a host of answers.  Make sure you have the right answer yourself, build your career around it, and perhaps you’ll avoid the fate of the average CMO whose job tenure at under two years!  Rodney never got any respect.  CMO’s should, but they need to earn it and deserve it.  Let’s start with a role definition.

For some, marketing is about brand, with a lower case “b”.  It’s about fluffier stuff under the umbrella of marketing communications…advertising, PR, website development, social media, collateral, lead generation, and maybe field marketing under the rubric of sales enablement.  This is part of the equation to be sure…the executional part…and works well when marketing is asked to provide a service function.  However, this isn’t seen as a serious content role, and it doesn’t buy you a seat at the executive table.  Rightly so.

For others, marketing encompasses brand and marketing communications plus…business strategy and planning catalyst, partner and channel marketing, competitive intelligence, database marketing, product marketing, product roadmap direction setting, pricing, industry and financial analyst relations, executive sponsorship roles for key clients, internal communications, and culture catalyst.  This is a serious role…a capital M Marketing role…a role equal to if not greater in importance to the success of the business than other peer functions around the executive table.  If marketing is about Brand, that B is a promise of value that is infused in everything your company (and ecosystem) does that touches a customer….which is just about everything.

After all, what is a business about.  Customers.  How do you get them?  Through an outside-in, market-centric perspective rooted in knowing who buys, what they buy, why they buy, when they buy, where they buy, what their alternatives are, what the buy is really worth to them, what will keep them coming back for more, what would they like to see in future products, what drives them to recommend and advocate…you get the idea.  All the various marketing roles described above come together through the connective tissue of customers.  That’s the business of the business, and it should direct everything your company does.  Marketing is rational and emotional. It is measurable.  It is accountable.  It is tangible, and yes, it is creative, artistic, insightful and innovative.  It is indeed art and science to the very best practitioners, and not everyone possesses that combination of left and right brain skills to be the best.

The CMO today faces more pressures than most in not only having to master all these skills, but the skill sets in demand are in a state of constant evolution.  Remember marketing ROI and accountability?  OK, now that is (hopefully) table stakes.  How about digital marketing?  Got that down? Social media? Know what it is, what it isn’t, and more importantly, where it is going?  Up on the latest tools and techniques for customer engagement?  Understand how to not only drive innovation but how to execute to business materiality?  Truly collaborating in your flattened organization and expanding ecosystem?  Getting to customer advocacy?  Achieving authenticity at a time when marketing = shill and proxy?

Whether you run marketing for a team of two or 2,000, this is what the role is all about.  Do it well, inspire, educate, maintain a sense of humor and perspective, and you will earn that respect.