Category Archives: Innovation

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CliffsNotes as Long Form

Neal Gabler always makes me think; last week he made me think a little harder.  His op-ed piece in the New York Times on August 13, 2011 “The Elusive Big Idea” (which I added to the Corporate Intelligence Radio Library) caused me once again to reflect on our spiritual respect for the technological achievements that too commonly enter our lives without enough awe.  Thousands of years of civilization and learning have taken us through The Renaissance, The Industrial Revolution, and now Digital Transformation, putting on our desks and in our hands more MIPS (millions of instructions per second) than humanity ever could have envisioned just a half century ago, with Moore’s Law in little jeopardy of compromise anytime soon.  And the question remains: what are we doing with it?

Gabler is a prolific author and senior fellow at the Annenberg Norman Lear Center at USC who suggests in his recent essay that in this post-Enlightenment Age, we may for the first time be going backward intellectually, and that as “information narcissists,” we are allowing our brain cycles to be consumed by endless temporal factoids at the cost of more thoughtful inquiry.  I can’t do a better job of making the point than Gabler, so I invite you to read the full piece which is linked above, but his concern stems from the impact of the parade of dribbling tidbits from the internet that distract us from the harder work of digesting and discussing what were previously known to us as Big Ideas, the most recent of which were summarized in The Atlantic and didn’t seem so big to Gabler (me either!).  We store and remember these media snacks for their brief life cycles, failing to reserve more extensive internal processing power for the ambiguous and abstract.

Since I have spent almost my entire career as part of the problem and never the solution it would be hard for me to get on this bandwagon without impeaching a life’s work, but I have to say, I am sympathetic to Gabler’s critique.  I remember well our teachers’ fears when we were growing up, watching and memorizing ceaseless half hour episodes of Gilligan’s Island and The Brady Bunch, that our fragile attention spans were being decimated by the power of television.  Every sitcom with its full 22 minutes of content has a beginning, middle and end, it tells a story with resolution that is mostly satisfying and even has three laughs per script page.  Prior to that you’d need an hour of dramatic TV for story, prior to that a 2 hour movie, prior to that a 3 to 4 hour stage play, and prior to that a novel that might be as brief as Huck Finn but could be as long as Moby Dick.  Indeed, our generation was the beneficiary of staggering efficiency.  We welcomed those little yellow books then called Cliff’s Notes covering a novel with about 90% compacting — but then again, that still left a thirty or so page pamphlet that had to be read.  The second year I was in college something crawled out of cable called MTV, and that took storytelling down to just about three minutes, even more efficiency, and many of these micro video operas were created by TV commercial directors, who could tell a story in 30 seconds.  When YouTube gets the job done in under 8 seconds, I say that’s nice, but that was the easy part of the optimization, that just knocked out the last 22 seconds, the hard work of leaving Herman Melville in the dust was already diced and strained long ago.

How about that, an entire moral tale bypassing hundreds of reading pages, fully consumable in 22 minutes with two breaks for bathroom and pantry runs — O Brave New World (that’s a line from The Tempest, which is a play that was written by Shakespeare, who was a kinda like Steven Spielberg, back when Queen Elizabeth I would have had her mobile tapped if phones had been invented)!  So if our attention spans are now down to 140 characters because that’s the Twitter standard adopted from mobile texting, how do we keep “longer forms” viable and where do we get into trouble when we don’t?  I don’t have a solution anymore than Gabler does, because efficiency really is attractive for anyone who does not know what they are missing in the nuances of polysyllabic adjectives and adverbs, but I do worry about the ramifications.  Because so many stories are now reported in sound bites, those featured in stories have learned to communicate with directed outcomes in sound bites.  I am not too worried about this for entertainment purposes, if someone enjoys an 8 second tree squirrel ballet on YouTube and doesn’t wish to sit through The Mahabharata, I see it as their loss, but the sun will come out tomorrow.  Eventually all culture could be destroyed, but after a few generations no one will remember.

What I do worry about is news and government leadership.  Currently we seem satisfied to be internalizing critical issues in sound bites, and that is why we are being treated like idiots by our incumbent and aspiring leaders.  They are taking for granted that we don’t have the patience to get in the weeds, so they are feeding us unsprouted seed fragments.  They are failing at devising levels of substance because it is not required of them, we are accepting their failure, and the cycle repeats.  We must make this stop.

The first decisive media sound bite I can remember was the Ronald Reagan game winning “There you go again” to Jimmy Carter in their 1980 debate, halting then President Carter from launching back into a long form malaise of more pedantic matters.  I sense that much of Reagan’s future success was defined real-time in that smack down, and we learned to like him for style whether or not he followed through with substance.  It seemed quite unscripted and endearing, and it worked.  Today we listen to endlessly planned runs at sound bites, poor imitators of extemporaneous reduction, not even extracting them from context because they are context.  We must make this stop.

How can we obstruct the content obstructionists?  Again, Gabler is much more eloquent on the problem than I am, but I fear neither of us has a good solution.  Here is what I can tell you — gadgets and efficiencies are going to continue to accelerate, and even if we could break free of needing to interpret consequential texts and tweets and posts, our kids are in it for the short haul.  All I can suggest is that we do everything we can to teach them an appreciation for reading, help them to understand that multitasking while useful is the antithesis of focus, and lead by example by not letting any leader off the hook with a chorus of sound bites and no carefully composed libretto.  The information is there if we want to read it or hear it or debate it, more than has ever been available is now being ignored, but we have to be willing to invest the time.  Just like you won’t accept second-rate technology, stop accepting second-rate garbage in the form of info morsels where substance is required.

Feel free to still enjoy YouTube and reruns of Gilligan’s Island.  Society will survive the culture shock, but where brevity is meant to mask laziness among issues that are critical to our sustenance, that has to be called out.

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Things That Work, Things That Rot

I think I know why Apple is one of the most valuable companies in the world, if not the most valuable. Simply stated, the company’s products are elegant, and they work. They are intuitive, and they work. They are designed with vision, and they work. Most of all, they work.

Am I willing to pay a premium for that? You bet. Are a lot of other people? How do you think they amassed more cash than our Federal Government (which, incidentally, has proven of late that it does not work). Yes, people will pay a premium for elegant, intuitive, well-designed, visionary products that work. To the victor go the spoils. We get tremendously useful products. Apple gets our cash. We may grumble about the constant upgrade cycles, but we shouldn’t often grumble about the value proposition, We get what we pay for, and in my mind, it’s worth it.

My experience earlier this year buying my first iPad could not have been more pleasant. I began my research polling friends on my Facebook page for feedback on what configuration to buy, and not only got great information, but rave endorsements for the iPad2 itself. I then went to the local Apple Store and despite the fact that they were sold out of iPads, a very well-trained and nice salesperson spent a great deal of time with me going over my options, then suggested I order my iPad online (with free shipping and engraving) to get it sooner. Other customers in the store were also Apple evangelists and offered me lots of friendly tips on apps I might like. I went home, ordered it on a Monday afternoon, had it on Friday morning, and used it all that weekend without any need of a manual or user guide. To take this all the way home, on a recent business trip some of the functionality froze, but when I searched my issue on Google, there was plenty of user feedback that accurately told me how to “reboot” the iPad and unfreeze the grayed-out state I encountered. The fix from problem to resolution with community help took six minutes.

LoveCustomersCompare and contrast this experience with my recent encounter with my telecom company. Early last week, my broadband connection to the internet vaporized—gone, kaput, no warning, no connectivity—in the midst of this week’s heavy stock market trading, which made the timing even more problematic. With sweat inducing trepidation, I called the 800 service number, and after five minutes of voice assisted prompts, I got a very polite person on the phone. This person thanked me for my business, assured me I was appreciated, took my phone number in case we got disconnected, then began to ask me to plug and unplug things which I told him I had already done. Thirty seconds later he accidentally cut off the call. He never called back.

I dialed the 800 number again, went through the voice mail prompts, got another polite human being ten minutes later. This person apologized for the first person cutting me off. Then after some give and take and checking with her supervisor several times while she put me on hold, she communicated to me more than thirty minutes later that my “old” DSL modem, which they had sent me in 2005, was incompatible with a change they had made in their network “at the central station” (sadly, my neighborhood is largely stuck with ancient DSL technology, but that’s another grating story). She then congratulated me on my eligibility for a new and improved free modem upgrade, which she would order for me as soon as her supervisor approved it. I had to go to a meeting, and indeed, 45 minutes later she called and left me three voice mails to congratulate me again that the free modem had been approved and would arrive in 24 hours. It did.

Unfortunately when I connected the new modem, it did not connect to the internet, so I called the 800 number again. After the voice prompts I got another exceptionally polite employee on the line, and this person apologized for the fact that the new modem did not work, but told me a ticket was open and would be resolved by Friday. It was Wednesday. I needed to be online. The nice person said he would escalate the issue, but that a configuration change had to be made at the central station according to the notes in the file.

I lived without hard-line internet through Thursday, saved by my iPad which of course worked fine. On Friday morning I still had no internet, so I called the 800 number again, went through the voice prompts and got another wonderfully polite person who apologized again, but told me the switch at the central station had not been adjusted because of a work stoppage, asking me if I had heard or read about this. I said I had, but I wondered why they would have made a network configuration change earlier in the week, not told me, and sent me a free modem that needed to be configured at the central station when there was no one available to do that. The wonderfully polite person agreed with me that this was wrong, and said I should have been called before the change was made originally to advise me a new modem was coming before they had sent it. I asked if all this was supposed to happen without me calling and he said yes, absolutely, then apologized again for the inconvenience.

I asked when I would have my internet connection again, and he said he hoped it would be by Monday, if someone was available to make the change at the central station during business hours, since they did not work weekends, if they were working at all. I offered some less than polite words about the impact this was having on my ability to conduct business in a turbulent equities market, and suffice it to say, with a certain number of carefully worded phrases (including a promise to write this blog entry), my connectivity was restored about four hours later.

I suppose that’s one way to take a job to completion.

I write this not specifically as a celebration of Apple and an indictment of my telecom company. I offer it instead as a lesson in excellence and the loyalty a true commitment to customers will garner. What Apple does should be the norm, not the exception, but because it is the exception, they enjoy almost unreal loyalty from their customers. I believe most if not all businesses once aspired to such a level of passion, but today, not so much. Mediocrity seems to be good enough for a lot of businesses, and as customers, we are just supposed to grin and bear it. That’s one of the true costs of everyday low prices. Quality can become a coin toss.

Perhaps it is time to put a stake in the ground and demand better products and services in every capacity we consume. With all this choice, customers are supposed to be Job #1. But are we really? If we have been reduced to being consumers rather than customers, than at the very least, let us consume well—without frustration, without anger, with reasonable expectations of the value chain. I have a better idea: let’s not be consumers, let’s be customers and expect to be treated that way, with respect, forcing healthy market competition for our loyalty. We pay a lot for this stuff, honestly, we do. Quality should be a given.

Not much to ask, products and services that work—and that work well, all the time.

Then again, perhaps I might share with you another example of trying to replace a battery for a mobile device from a branded store where the device remains on sale but the batteries not so much. Nah, I’ll spare you, just scroll up and do a search and replace.

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Innovation Finds a Way

If there is one thing the history of evolution has taught us, it’s that life will not be contained. Life breaks free, expands to new territory, and crashes through barriers, painfully, maybe even dangerously.  — Dr. Ian Malcolm (Jeff Goldblum), Jurassic Park, 1993

When not engaging in polite conversation over the past few weeks that involved either unsound journalistic ethics at News Corporation or the pending apocalypse of the U.S. debt ceiling, the most popular question I tended to encounter was, “Do you think we’re in a stock bubble?”  Truth be told, that has been a raging topic all year.  The cover story in the current issue of Fortune is “Tech Bubble 2.0” with a reasonably balanced assessment of Is It or Isn’t It.   My assessment?  Got me.

Here’s what I know.

It’s sure not 2000.  The internet is real now and so are an incredible number of businesses being launched of late.  This new wave of entrepreneurial enterprises sits upon real business models either with real revenues and real profits or real revenues and reasonably predictable profits at scale.  The business models are new, unexpected, but sound.  Some are working wildly well and bringing buckets of cash to their corporate bank accounts with pleased and well served customers, employees, and shareholders.  Others hold promise to do the same, aren’t quite there yet, but don’t take a lot of imagination to understand how they will scale to profitability because their models make sense.

Corporate earnings appear for the most part to be sound, albeit with heavy cost controls in place that aren’t doing much for the unemployed.  If you are buying the major indices across the board — domestic and international, large and small, growth and value — fully diversified along with fixed income to your own level of acceptable risk, you probably aren’t having trouble sleeping at night (except, of course, when you think about resolution to the debt ceiling).  Are the markets volatile?  They are, but they always are.  Are the fundamentals and multiples reasonable?  Well, I’m not an economist or a trader, but the Dow looks pretty understandable to me.

So how about that bubble?  Major players in venture capital have issued their opinions and are easy to search on other blogs, I am hardly qualified to comment.  Is it likely that some valuations are products of hope, optimism, or hyperbole?  Tell me anytime when that’s not the case.  Have you ever heard a Realtor tell you it’s not a good time to buy a house?  It’s always a good time, if it’s the right house at the right price.  My sense is, same with equities, preferred and common, private and public.  Bubble is a broad and complicated idea, always easy to assess in hindsight, virtually impossible in the crystal ball.

That’s what I know.  Sorry if I disappointed.

Here’s one thing else I know: the innovation all around us is astounding.  I can’t remember a time when there was so much happening so quickly and so much of it actually looked like true value creation.  Here is small sampling of the mind-blowing advances all around us:

Apple — the iPhone was a game changer, the iPad is a life changer.  I think the iPad will change everything about media for a generation.

Netflix — another game changer, first movies by mail, then movies on demand, easy and affordable, changing entertainment distribution paradigms at every turn.

Zynga — will people buy virtual goods?  They will.  Can a tiny segment of your audience underwrite the ability for everyone else to play free and still create profits?  Indeed.

Pandora — here’s technology that lets you create your own radio station that not only plays the songs you already like, but introduces you to new music you probably will like.

LinkedIn — not long ago if you had your resume online you were job hunting, afraid of being caught by the boss; now you must have your resume online or you don’t exist.

Hulu — one new brand aggregator derives more advertising revenue from network created content than the total online revenue of all the suppliers combined; wow!

Groupon & Living Social — coupons used to be the least cool way in the world to shop; call them time sensitive Daily Deals and online drives consumers back to storefronts offline.

Twitter — people communicate in less than 140 characters and the world is connected through snippets of information that can alter public opinion and evangelize democracy.

Facebook — connect people with friends, redefine the verb like, open your platform, create the most display ad inventory imaginable, then enjoy the value of 750 million accounts.

Again, this is just a sample of very cool companies doing very interesting things, among them, creating jobs and creating wealth.  Each of these represents incredible creativity, brilliant execution, and deep levels of passion.  People are working hard, people are working smart, people are being rewarded.  With > 9% national unemployment still our challenge, it is inspiring to see there are paths out of the malaise.  There are lessons to be learned in the current Silicon Valley run-up, first among them, the key is innovation.

It is ironic this “Tale of Two Economies” comes at a time when so much of the nation’s economy is suffering, and so many job losses lead the gloomy headlines.  It’s also ironic that it comes just as we lose a much beloved company, Borders, which in its day reinvented our notion of what a bookstore could be.  When the first wave of internet companies changed the landscape, Borders leased their digital real estate to Amazon.  They never recovered.  I asked a former VP of mine her sense of this recently, to which she replied: “They just forget to keep innovating.”

Perhaps the former CEO of Intel, the incomparable Andy Grove, said it best and most succinctly in the title of his 1996 book: Only the Paranoid Survive.

While I will always be reticent to render an opinion on the fair market value of a company, I can give a resounding endorsement to so much outstanding work I see going on all around us, much of it disruptive, as it should be in an entrepreneurial landscape that favors creative destruction.

Given a choice to share an opinion on the bubble versus the landscape, I’ll take the landscape.  I like what I see.  I would like to see it spread.  The old jobs aren’t coming back, innovation and automation pretty much assure that, there is little point waiting.  Let’s hope the new business models work so that new jobs will replace them and all boats float with the rising tide.  Many companies will fail, but the direction seems right.

Creativity tempered by sound judgment is the currency of the new economy.  It remains largely an open playing field for anyone who wants to relearn on a daily basis everything they thought they knew.

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Product Development is Not Democratic

Following up my last post on the scarcity of successful internet brand turnarounds, I had a number of interesting discussions with colleagues in search of the answer why. While it would be impossible for me to boil that down to a single concept in a single blog post, the common theme seemed to be the extraordinary difficulty in reinventing the key products or services under a once a powerful but now fading brand, such that the new offerings were up to the standards of the original breakthrough experiences.

Digging deeper into this theme of why a brand that was created of innovation could have such a hard time finding reinvention in subsequent cycles of innovation, the culprit fueling failure often found the compass needle pointing at process. Where some form of good process once allowed staggering creativity to flourish, failure to reinvigorate good process most often led to uninspired product development, lackluster offerings to customers, and ultimately a continuation of the downward spiral where a turnaround was the hope. Called out for especially pernicious result:

1) Tepid Innovation—believing that a little idea was a big idea almost in desperation for lack of identifying a big idea. Copycat products that responded to market leaders to segment small bits of their commanding market share consumed energy where market leading ideas remained in small supply.

2) Lack of shared vision—weak leadership failed to articulate a big idea around which teams could rally, so buy-in became compelled rather than organic. Empowering strong leaders to lead is not often enough a company’s core competency, because truly creative rebels don’t want to be managed, they want to be sponsored, so that they can make change happen in cultures that prefer conformity, and conformity is not how you win market share. When the right leaders are chosen and empowered, they can build a shared vision by leading, not managing.

3) Corporate intervention—a young company acquired for its Think Different mentality and bold new ideas becomes indoctrinated in the prevailing corporate culture of the parent, and begins to see the world through the lens of the acquirer rather than for the reasons it was acquired.

4) Lack of listening—there is no longer a measurable correlation between time on the job and quality of concept. The youngest arrival in a company may just have the best ideas, but if there is no forum for real listening and discussion, the most creative voice can be too easily silenced.

5) Marketing/Engineering Wars—rather than partner, the two necessary sides of the winning formula argue for the sake of winning the argument. They forget what it means to win—that their competition works at another company.

Dynamics of Software DevelopmentMany of these themes are explored in the brilliant and surprisingly nontechnical book Dynamics of Software Development by Jim McCarthy, which I have encouraged every senior executive I have met to read as well as every staff leader I have mentored. In my experience the core issue comes down to learning how to build a consensus, understanding that consensus building is not polling or voting or majority rules. Product development is an expertise, like any other profession. Many individuals can learn to do it adequately, but few can do it extraordinarily.

Look at some of the new wave of great companies and you see the top-tier of product development pros at the helms: Mark Zuckerberg, Reed Hastings, Elon Musk, Reid Hoffman. Of course those are all CEOs of substantial, important, disruptive companies and they are not available for brand turnarounds at internet companies on the rebound, but the question remains, are the people being put in charge of turnarounds somehow similar in nature and characteristics to the great leaders of product development? Are they able to articulate a vision around which people can rally willingly and with trust? Do they listen to a multitude of opinions and then make decisions that incorporate feedback because it is critical, not because it represents a political agenda? Do they have good taste, and can they see beyond the state of today to leapfrog a competitor with perhaps something that didn’t do well in a focus test? Have they built a process in their environment where good work can shine and fast iteration can overcome mediocrity in rapid succession?

Consensus is an astonishingly complex concept; it is not at all compromise. It begins with vision, It is evangelized through leadership, It becomes stronger through group participation and feedback, but it is guided to completion by the same vision and leadership from which it emanated. Consensus goes off track when a leader feels for whatever reason that bits of all contributions most be included to create the consensus, the proverbial camel with two humps. That is wrong, because all comments and critiques will not be right if breakthrough products are your goal. Group participation is a must to achieve organic buy-in, listening is a must for a leader to bypass being feared as a despot, but for great product development to triumph, a vision must remain strong, pure, unique, original. That can never be taken for granted, and everyone on a team will not always be happy at every twist and turn. Yet if you have ever had the privilege of working on a world-class, game changing product, you know that most sins are forgiven when it all comes together through good process, and it does not look anything like the system of checks and balances we see in representative government.

Product development is driven by a different motive set, of creative destruction and inspired disruption, a high stakes arena where often winner takes all, second prize means you go home. Democracy does not work there, and democratic compromise is not workplace consensus. Show me a great product, and I know you will find iteration, but I bet you won’t find haggling.

Vision is what launches a brand. Vision will always be key to reinventing a brand. Process is the key to translating ideal vision into working reality. Consensus is the element of process that gets everyone on a team to remain part of the team, because success is owned by the team, not by its individual components. Get most of that right and product development has a fighting chance, and so might reinvention.