Will regulators ever catch up with innovators?

Will regulators ever catch up with innovators?

Nov 3, 2017 | Change, Governance, Leadership

 

Following on from the rant about the dominance of Gooface a short while ago, comes this ‘explanatory‘ note from Facebook about a test being carried out in several countries that smacks of changes being made to the newsfeed that will remove completely organic posts from a company you might follow.

In other words, if a company wants to communicate with you, the current squeeze that applies is insufficient, there is a revenue opportunity available to Facebook by removing completely the currently thin chance their posts will get into your feed.

Josh Bernoff explains it clearly, in this post  along with his usual dose of cynical amusement at the arrogance of Facebook.

If there was ever evidence needed that marketers have no option than to build, over time, their own digital presence, based on digital properties they own,  it is this move to eliminate the organic reach that gave the social platforms their start, in the chase for revenue.

In this country (Australia) we have been beset by an ongoing debate about the rules governing the ownership of media. Back in the 80’s, rules were imposed and adjusted over time, that prevented ownership in one regional (in Australia) market summarised as ‘no more than 2 out of three and  75% reach’.   They were designed to ensure the diversity of ownership and therefore points of view being expressed by the few who had the wherewithal to own a media outlet. It finally dawned on the geniuses in Canberra that by stealth, while they were not watching, Gooface and their ilk had changed the face of media, and the rules were the equivalent of banning the shooting of dinosaurs.

Righteous,  but a little redundant.

Now everybody can own a media outlet, everyone can be a publisher, for a few dollars.

I suspect the answer to the question in the headline of this post is a definitive ‘No’ and we all know the problems that emerge when you are doing nothing but playing catch-up in an environment where your domain knowledge is limited to non-existent. You get the  sort of reactionary decision making and half-baked ideas that make you look stupid.

It strikes me that this is the core of the lack of confidence slowly eroding the respect and confidence we have in our institutions, and the only true antidote to that sickness is a solid dose of leadership.

I am not holding my breath.

 

Message to the new CEO.

Message to the new CEO.

Nov 1, 2017 | Change, Governance, Leadership

It is a scary place, no matter how much you have worked  and trained for it, suddenly you are the man (or woman) everyone is looking to for the cues they will use that drives behaviour and ultimately results.

No person can do everything, but every leader needs to tell those around them what is important, and in every business, there are always 5 things worth putting on the table as your priorities.

Cash flow.

Cash is the lifeblood of every business, without it, the business is dead. Too often I see little or no attention paid to the cash that flows into and out of  a business, the leader relying on the monthly P&L for the financial feedback. Cash flow and the P&L are different, they give a different picture of the health of the business. Both are essential, but neither gives a full picture of performance without the other. However, failing to actively manage your cash is akin to going swimming in the Alligator river.

Hire the best people you can find.

The mark of a great leader is to find engage and motivate people who are better than they are, even in their areas of strength. Delegate the things you do not like to do to someone who not only does it well, but who you can trust to give honest and considered feedback.

Focus.

Focus relentlessly on the manner in which the organisation delivers value to customers, and secondly on the development and deployment of the capabilities necessary to ensure that value is sustainable because it is able to evolve faster than the surrounding competitive environment.

Build a management rhythm.

Every business has a rhythm that dictates the order  and importance of jobs to be done. In my experience, starting with the macro, and working progressively to more detailed reporting and task allocation ensuring extensive feedback and adjustment loops along the way  is the most productive and efficient way.

Embody the culture you want to build.

The only person who can really change the shape of the culture in a business is the person at the top, so it pays to be very explicit about the culture you want to build. You need to talk the talk, while walking the walk, and be able to do  both without faltering, and with absolute consistency, in even the tiniest detail. We have all heard the quote  ‘Culture eats strategy for breakfast’ by Peter Drucker.  It remains absolutely true, and do not forget it.

Good luck, and have fun and build lasting personal relationships with those around you, after all, you only get one life.

 

The getting of wisdom

The getting of wisdom

Oct 16, 2017 | Governance, Leadership, Management, Strategy

As I get older, the world seems smaller, more complicated, but smaller. This is not just the technology we all now have that has shrunk all the boundaries of our world over the last 20 years, putting the all the  information anyone has ever had at our fingertips, that is different.

It is one thing to have all  the information, it is quite another to be able to make sense of it.

There has been a progression from data to information, to knowledge that has been recognised and widely leveraged, but now there is another level to the cake, wisdom.

We all have access to the same information, can find those who have the knowledge to use it, but it is wisdom, born of experience and breadth of thinking that delivers the wisdom now so rare, but so sorely needed.

I like very much the philosophy of Charlie Munger who talks about mental models, ways of assembling knowledge and sifting through it, reorganising it to be seen from different perspectives that offer a different view. The more mental models you can bring to bear on a topic and body of knowledge, the greater the chance that there will be some insight that emerges unexpected from the model.

Charlie speaks of his mental models, and their source often, a man of few words, leaving most of them to his mate of 50 years Warren Buffet. However, in 1994 he wrote what has become a staple of business thinking , his ‘Worldly wisdom’ speech.

As a kid, we learnt stuff by experience, and using mnemonics,  devices to assist us to remember things. Rhymes, associations, colours can all play a role. Wisdom seems to me to be the opposite end of the mnemonic, the ability to see connections between seemingly unconnected pieces of information, and it is our mental models that enable these connections to be made.

By contrast what we have often these days are unrelated facts presented as a cause and effect, or a set of actions that worked in one place being expected to work in another, which may seem similar, but at a deeper level are not sufficiency similar to enable the actions to deliver the same outcomes.

We tend to be a society that believes, or wants to believe  in miracles, perhaps cargo cults, because it is easier than doing the hard thinking yards.

As someone who gives advice for a living, it is incumbent on me to have a clear framework from which to distil the information to have into advice that is tailored to the needs of those being advised. As often as not, the advice is not heeded, or taken in parts which sometimes hurts, as it reflects poorly on the end result, but it is the reality of making real change.

To be able to deliver the unwelcome news with confidence that it will hold, I need to have a range of mental models, models that come from the work done over 45 years in marketing, sales, operations, leadership, logistics and accounting, and be able to filter the information in front of me through the range of models in a routine and organised manner. Each model gives a slightly different interpretation of the facts, a different slant that requires consideration, so that each outcome is slightly different to the past, but best fitted to the situation to hand.

When you need a bit of wisdom, give me a call, perhaps I can help.

For context, vital in the consideration of Wisdom, the blurry photo is of a group of islanders in the Pacific at the end of the war. People on remote islands had become used to planes going overhead and dropping supplies to the troops. When the war ended, so did the dropping of supplies, an outcome not anticipated or understood by islanders. Physicist Richard Feynman gave it the name we all know: ‘Cargo Cult ‘in a speech in 1948. 

 

Googles 5 foundations for a successful team.

Googles 5 foundations for a successful team.

Sep 25, 2017 | Collaboration, Leadership

Teamwork, collaboration, and all sorts of clichés relate to the workings of teams.

Over the last 25 years they have invaded and become pervasive in our workplaces, but most often they do not deliver the hoped for outcomes.

On Saturday night, those of us who watch Rugby League saw a display of teamwork we should remember. A busted, down on personnel Cowboys team coming from an unwinnable position on the seasons table, beat the favourites who were full of enthusiasm, confidence and with a full playing roster, to get a shot at the title.

How does that happen?

We all mumble about ‘team culture’ without knowing really what it is, and where it comes from, while working to find it for our teams.

Google uses teams as the core of their operational and development processes, they have not become one of the most successful companies in history by getting it wrong. However, like the rest of us, they did not really know what made a team successful, so set out to find out by deploying their formidable skills and resources to answer the question.

The answer they came up with surprised them, although it should not have, as once seeing it written, it is pretty obvious.

  • Psychological safety: Can we take risks on this team without feeling insecure or embarrassed?
  • Dependability: Can we count on each other to do high quality work on time?
  • Structure & clarity: Are goals, roles, and execution plans on our team clear?
  • Meaning of work: Are we working on something that is personally important for each of us?
  • Impact of work: Do we fundamentally believe that the work we’re doing matters?

For someone like me who has worked with teams for a very long time, the response on seeing this list, reproduced in summary above, is ‘of course’. However, when constructing teams, how often do we take the easy way, grab who is available, allocate a superstar and expect them to carry the load. Meantime we do not make sure the dynamics of the group are the focus of the construction, give insufficient consideration to the mix of skills and personalities, and then be less than specific about the outcomes required, the plans to get there, available resources for the team to use, and the time frames required.

I am not even a great fan of Rugby League, but the quality of the Cowboys team on Saturday night would indicate that a test along the lines of Googles 5 headline requirements would return a very high score.

It will be fascinating to watch the grand final next week against the Melbourne Storm, a team that has made the culture of the place a core of its success since entering the league in 1998.

 

Photo credit: AAP Dan Himbrechts

 

Don’t believe everything you think

Don’t believe everything you think

Sep 22, 2017 | Change, Leadership

 

Leaders who are unable to see another point of view, listen to others, and absorb and engage with diversity are destined to make mistakes.

Good leaders have a point of view, but they allow others to put theirs, see when their ideas can be improved, and sometimes utter those amazingly strong leadership  words ‘I did not know that’

Your beliefs, powered by experiences are powerful barriers and filters to the way you see the world, they reinforce the status quo for you.

Have you ever made a mistake, seen a better way with the benefit of hindsight that should have been obvious with a little more information, thought, time and effort?

Yes, most of us have.

If you answered no, seek counselling, quickly, before you do  any more damage.

Cartoon Credit: Hugh McLeod at gapingvoid.com

 

11 growth strategies for small businesses

11 growth strategies for small businesses

Aug 23, 2017 | Leadership, Management, Small business

The last 23 years of working with, reconstructing, and observing small businesses in all sorts of situations has resulted in a pile of insights on many areas of business. A common fact or is the desire to grow, even when in the darkest times, almost all businesses aspire to grow. This is not ego, or self-delusion, it is simply a general acknowledgement that to stand still is to be overtaken.

Grow or get trampled.

The common factor of those that have successfully grown is that they do not follow any recipe, there is no guaranteed growth map, but it is clear that they have all combined some common elements in different ways to succeed.

Be different.

Every successful business I have seen has done something different to those around them, with whom they compete on a day to day basis. Being part of the crowd results at best, at being on the top of the ‘average’ range. Differentiation in the manner that they deliver value to their customers is perhaps  the most common element of success I have seen. It need not be a major thing at first glance, but combined with some of the following elements, differentiation becomes a powerful driver of growth.

Great product.

As the old advertising  saying goes, ‘The customer is not stupid, she is your wife’ . There is no situation where an average product can sustain above average performance. All the clichés and PR gloss in the world will not do any more than get a first sale, after that the product has to deliver value greater than available alternatives. It is the form of that value that differs dramatically, and value does not always mean technical quality, it means fit for purpose.

Growth is a relentless master.

Growth never happens in isolation of focus, effort and commitment. Every sustainable growth business I have seen, or read about, has somewhere in its DNA, a focus on growth, in a way that seizes opportunity, makes it work, learns from what does not work, and goes again. It can apply this focus while ensuring that the every-day operations, the ones that pay the bills today, are well taken care of.

Marketing is shaped by the need.

Too often marketing is seen as a formulaic process that just requires the appropriate level of investment and capability to be successful. Wrong. Every situation requires a differing mix of marketing elements, and there are no two situations where the template will just ‘work’. Just ‘doing marketing’ will not lead to growth, the marketing has to be connected to the intended customers viscerally or it just becomes another of the millions of messages to which we are all subjected every day.

Find a niche and own it.

Whether you are the corner store of Apple, you cannot be all things to all people, in one way or another, you need to focus on those to whom you can deliver superior value. The evaluation of your target niche, the motivations of those at the bottom of the niche who are likely to be your best, stickiest, long term customers, then delivering value to them, is a key to growth. Once you have consolidated your niche, widen it a bit, seek adjacencies, look for novel uses of your capabilities in other niches, but never forget the niche.

Growth is long term.

Nothing useful happens overnight. Growth happens as a result of patience, commitment, and an ability to remain focussed on the goals, even when the short term stuff looks dark, or there is some compelling distraction. While it is fine to experiment, sustainable growth comes from building smaller success over time, not from frequent changes in direction. When looked at in hindsight, successful growth always has some elements of compounding small success present. Remember the fable of  the wise adviser who wanted nothing but compounding grains of rice on his chessboard, each square having double the grains of rice of the previous.

Seek leverage.

Identifying the means by which you can apply leverage to the assets you can deploy always pays dividends. Often this means combining your marketing with the behaviour  drivers of those in your niche to deliver some unique value, bit just as often is means ensuring that the basic processes that deliver the cash every day are robust, and repeatable. Having Standard Operating Procedures that are a part of  the operational DNA saves huge amounts of time and energy better applied to activities outside the mundane . Successful growth engines always have their core processes working well, and those growth activities seeking the points of greatest leverage.

Insights not data.

These days we run the risk of being overwhelmed with data, unlike when I started in business, when quality data was a rare beast, hard won. Today there is just so much data that the real skill is sorting it out and finding the hidden gems that offer insights you can leverage.  Data guru Avinash Kaushik calls it ‘data puking’ which is in my view a fine description. The metaphor I use is going into a library, without any idea what you might be looking for. You end up overwhelmed by the choice, with little chance of finding the right book.

Recognise your ecosystem.

What makes successful businesses successful is an ability to mix and match the best options for  their target customers, in ways that best deliver leverage for both parties. Growth is a two way street, no business can be sustainably successful unless their customers and suppliers are also successful. The task is to make the pie bigger so everyone benefits, not to take a bigger share of a static pie.

No silver bullets.

Growth comes from hard work, focus, determination, commitment, and not from luck or circumstances. My old dad used to say, the harder I work  the luckier I get. And that has been echoed by every successful person I have ever come across. It is never left to chance, it is a managed, deliberate process of making choices between alternative applications of limited available resources, being proved right more often than not, and learning from the times when you are wrong.

Clarity.

Finally, and perhaps most importantly, is clarity. We are in a world that is intensively competitive for the attention of those we may be able to serve. It does not matter if you are the corner store, or a multinational, your marketing challenge is to gain, then hold attention of those we can best serve, while we relate to them the reasons their best interests are best served, their challenges overcome, by working with you. The first test is to ask a few of your employees, close friends, and current customers what problem you solve, looking for a consistent and clear response. In its absence you have some work to do.

A lot of this is common sense, an increasingly rare thing in a complex world.