But We’ve Always…

It’s December. For those of us who make our living in any form of consumer business, that usually means two things:

  • We have made it through Black Friday and Cyber Monday, with our projections now being evaluated against actuals.
  • In less than a month it will be a new year, where we can either make the same mistakes again or invent new ones.

That leads to two takeaways I would like you to consider before the year ends:

  • Customer behavior tells us almost everything we need to know to be successful in business, particularly when we study data and benchmark assumptions against metrics.
  • We ignore the realities of customer behavior at our own peril, but darn it all if we don’t come up with really good reasons to flagrantly repeat our mistakes with passion and conviction.

How does our eye come off the ball precisely when it is crossing the plate and our bat is in swinging position?

It all begins with three wretched words:

BUT WE’VE ALWAYS.

Perhaps you’ve heard a few of these pronouncements before:

I know our customers complain when we send them too many emails, but we’ve always sent them at least four offers on Thanksgiving Day.

I know our customers don’t trust our pricing, but we’ve always jacked up our regular prices in the weeks before Christmas so we can mark them “50% off.”

I know it’s irrational to cover the cost of free expedited shipping and lose money on every sale, but we’ve always managed to convince our boss that losing money is the only way we can compete with Amazon.

I know our brand promise is what matters most to our company, but we’ve always managed to slip in a few low-quality products with our best inventory to even out our margins.

I know we believe our customers are loyal and have a lifetime value, but we’ve always cut our customer service costs to force our bottom line into compliance with our budget.

Yep, we know what we are doing is wrong, but we’ve always found a way to justify our shortcomings, weak logic, or poor decision-making because we’re out of time, out of patience, or out of energy to argue for doing what’s right.

Earlier this year I attended the third-annual ShopTalk conference in Las Vegas. It had grown 50% over 2017 with more than 8400 attendees. Ecommerce remains an escalating magic buzz word. There were two types of presentations:

  • “People may think our proud, established, vastly well capitalized legacy brand can’t adapt to new technology, but we’ve always been a customer favorite and there’s no reason anyone should bet against us.”
  • “We’re a new brand and will lose our jobs if we don’t succeed, but our investors are betting that if we brainstorm new experiments and focus on customer behavior, the results will tell us what works and what doesn’t.”

Which bet would you place with your own money?

Let me restate the choice:

  • “We’ve been around more than fifty years, we know exactly what we’re doing having coined a business model for hard-won success, we’re a household name, and we’ll still be a household name fifty years from now.”
  • “We have no idea if we’re going to be around in two years, but we’ll take whatever runway we have to figure out how to do what’s never worked successfully before.”

Don’t bother answeringit’s a trick question. The truth is you need some of both to win the long game, some of the newbies and some of the dinosaurs. Yet too many people convince themselves there’s little downside to a buy-and-hold strategy with “forever” companies like GE or GM. They won’t invest in a risky start-up with a funny name and an unproven business model like Amazon or Apple until it’s a fully valued blue chip.

No one knows what companies are going to win in the future, whether cemented or emerging. They all have unpredictable choices to make. It’s supposed to be that way. It’s how new companies are born and old companies die, or old companies are reborn through reinvention. It’s called creative destruction.

My point has nothing to do with improving your stock portfolio. My point has everything to do with recognizing the death knell of an established brand and bringing life or invigoration to a challenger brand.

It can be a fair fight. An established brand can be a challenger brand when it acts like an underdogwhen it stomps out the status quo and humbly looks to customers for confirmation or rejection of any working thesis.

I am willing to bet few employees at Amazon or Apple wander the halls uttering the words “but we’ve always” as a response to why they aren’t trying something new. Who knows, maybe I’m wrong, maybe they are becoming slow, cynical, and comfortable that they know what they are doing. I doubt it, but if they are, an opportunity for a challenger brand is out there for the taking.

I’ll bet they said “but we’ve always” a lot at Sears.

I’ll bet they said “but we’ve always” a lot at Toys ‘R’ Us.

When was the last time you said it? Still feeling good about that?

This year’s holiday shopping strategy is already behind us. There’s nothing we can do with history except study and learn from it.

The new year awaits all big ideas, particularly those focused on truly delighting customers with a sustainable business model and a resonating brand promise.

My advice going forward in whatever you are doing?

Eliminate the phrase BUT WE’VE ALWAYS from your company’s vocabulary before it eliminates you.

Erase those three words entirely from all conversation.

BUT WE’VE ALWAYS is defensive, uninspiring, and telling.

Try something instead that hasn’t worked, something that you think might work because you have reason to believe in a thesis. Measure the results. If there’s promise, hone it with precision. If it starts to work, stay humble. Stay inquisitive. Question the potential interpretation of every collected data point. Remember that every successful idea has a life cycle, and a bad idea yesterday might be reformed under changing market forces as a good idea tomorrow.

When an idea works dependably and someone questions it in a future review, just don’t say BUT WE’VE ALWAYS done it that way. You haven’t always done it that way. It had a beginning. It can have an end. What can’t end is innovation.

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Image: Pixabay

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More Fallout from the Zuckerberg Files

Should the unintended consequences that emerge in the course of a company’s evolution be a primary concern of management?

Is the exponential creation of shareholder value still the overriding force when a wildly successful company grows even faster than its own outsized vision?

Are the naive philosophical aspirations of under-experienced entrepreneurs a get-out-of-jail-free card from the ramifications of otherwise noble intentions?

In answering these and similar questions, is Facebook somehow a different animal?

These are some of the issues examined by a new Frontline documentary recently aired on PBS that frames a deeply damning critique of Facebook and its leadership team. While purposefully steering past the warm-and-fuzzy aspects of Facebook’s innocent exchanges of family photos and recipes, The Facebook Dilemma dives into Facebook’s structural roots.

The critique presented is strident but not unfair: Why didn’t Facebook as an enterprise heed the many early warnings of the pervasiveness of its influence and more strongly consider mitigation strategies, and now that the political chaos has been unleashed, is there any possibility of getting the bad genie back in its bottle?

When Facebook launched, founder Mark Zuckerberg braved a bold and curious global community manifesto:

“Our mission is to make the world more open and connected.”

That sounds good on the surface, and it sounded so good to so many of Facebook’s early employees that they rallied around the life-affirming purpose. They believed they were building a platform toward the betterment of humanity.

Simultaneously, the size of the audience embracing the platform created a media opportunity unlike any other in history. No company has ever thought about achieving monetization of a billion (heck, now two billion) individuals. To make sure no money was left on the table, Zuckerberg hired Sheryl Sandberg from Google to build that side of the equation.

The inherent conflicts soon became apparent. Facebook claimed to be a technology company, not a media company, even though its business model was selling advertising, which is what a media company does. To be the most valuable media company it could be, it needed two things: the world’s most in-depth data warehouse, and a rule set of utilizing that data with the fewest possible restrictions.

As a business, this all made sense. As you can see every day in the public company’s enterprise value, it worked beyond all expectations. The problem remains, it was initially fueled by another slogan:

“Move fast and break things.”

This ethos is not unique to Facebook. One of the tenets of Silicon Valley is to drive value from what is called an MVP, a minimum viable product. The point is to get a functional offering in the market quickly, find where it is successful, worry little about its failings, and start to iterate while building cash flow. Success is defined first by penetration (audience reach) and second by monetization (lifetime customer value). When things go sour, startups try to fix them, but because success is winner take all, most teams unapologetically expect there will be a lot of sourness to sweeten.

The question Facebook has encountered is unsettling: Is its very business model antithetical to fixing the byproducts of its success?

The Frontline documentary illustrates many of the ways Facebook has gone sour. Arab Spring. Fake news penetration in the 2016 U.S. presidential election. Russian intervention in media buying in the same election and outrageous exploitation of privacy by Cambridge Analytica. Violence in Myanmar.

Even Roger McNamee, a celebrated early investor in Facebook, took it upon himself to act counter to his own financial interests and ask Facebook management to step back and rethink the implications of its mindset. They did not heed his warnings. They were either too optimistic, too idealistic, too hooked on winning, too greedy, too ambitious, too arrogant, too busy to see the light of day, or a combination of all of those.

Facebook management has been reactive on all these fronts and done what it can to play whack-a-mole as crises emerge. Executives and managers there admit repeatedly they have been “too slow” to address the ramifications of their global viral adoption. The “too slow” apology parrots Zuckerberg’s appearance before Congress. It was a well-played chess move. It reveals no ethos of a fundamental commitment to a proactive playbook of innovative solutions. It’s a cost center, not a profit center.

Traditional media companies work under the direction of a qualified, responsible editor. When a journalist makes a mistake, the media brand runs a retraction. Facebook doesn’t want to be a media company, and it doesn’t want to be an editor, but any way you slice it, the algorithm that sits under News Feed is a robotic editor more likely to show you what it thinks you want to see than what is true or real. Then a perfectly targeted ad is inserted. That is how the game has been won at Facebook. It’s a winning formula. Any risk to changing that is far riskier to the company’s stock price than a few incidents of political unrest.

The real question remains: If Facebook’s mission requires that the company remove most obstacles to the free flow of information, the result of which is to facilitate unfiltered speech, the result of which is chaos, can it both stay true to its values and smooth over the chaos? And if the company is selling some of the most valuable ads in the world because the vast archive of privacy data is what makes those ads click, how can it impose limits on the interests of its ownership?

It’s a greater good question, one that capitalism believes is best left to the free market to solve, but in this case, it’s almost impossible to see how that gap is bridged.

Zuckerberg likes to say that Facebook is an “idealistic and optimistic” company. He said it when we was hauled before Congress to address the breach of privacy trust. When he was a younger man, it was a quaint proclamation I could have believed were it not for the true origin of Facebook as a college hook-up site. When he says it today, it sounds cynical. People who work for him might still be drinking the Kool-Aid. He’s selling advertising, justifying it, and trying to dodge regulation. To wit, he’s doing his day job as CEO.

Part of the problem might be social media itself. Its greatest strength is its greatest weakness. While pure democracy of publishing without a filter is liberating, audiences can easily be misled and mislead each other in chaotic exchanges of raw opinion. Add in bad actors buying access for covert agendas and the danger can become uncontainable.

Shortly before Zuckerberg testified earlier this year, I wrote a post entitled Is Facebook the Next AOL? At that time I wasn’t sure. Now I am. The byproducts of Facebook are so pernicious and likely unresolvable, I do think at some point the vast audience will abandon the platform. The cost of trading one’s privacy for family photos and recipes is too high. I don’t know when that will happen, and Facebook has a ton of cash so it can last a long time, but I expect the devoted masses will eventually exit their loyal addiction in self-defense. I don’t think this invention can adequately address the inherent conflict of interest it has created to thrive. Creative destruction will replace it with a better, more respectful product.

A brand is a promise. When trust is eroded, a brand dies.

I remain active on Facebook, but the broad notion that the world would be better as an open and connected place has always troubled me. Maybe it’s because I grew up as a kid learning of Nixon’s enemies list. Privacy to me always seemed to matter. Today’s political climate almost makes the Nixon era seem welcoming.

I’ve long subscribed to the notion that technology is advancing much faster than our ability to understand its implications. I saw that in my early career with the addictive nature of computer games. We see it all around us with people’s attention glued to mobile screens as they bump into each other and fall into fountains. We don’t really know what this stuff is doing to us. We buy it and use it and another tech company goes public.

Silicon Valley moves fast and breaks things because it’s good for business. Collateral damage is expected and as long as a company survives and grows few real tears are shed. Expecting it will change is unrealistic. It’s a form of realpolitik. Expediency wins over ideology because of the vast money at stake.

Since you’re probably staying on the social media playing field indefinitely, protect yourself. No one else will.

_______________

This article originally appeared on The Good Men Project.

Image: Pixabay

It’s a Hard Rock Life

From Nothing by Ken Goldstein
From Nothing, my third and most personal novel, has moved from my ownership to yours. I hope it will mean something to you. It certainly has been an odyssey for me. The book is rock and roll, the process of performing it no less so.

As I write these words, I am preparing a number of public book talks, thinking about what I want to say about this story beyond letting it speak for itself. That’s always hard, and particularly difficult this time because I did choose each word in the book carefully. My dear editor and publisher at The Story Plant might say I deliberated on them too carefully, which is why this one took so long, but hey, that’s who I am. Spontaneity for me is a highly composed orchestration that only sounds top of mind when recited.

Since the majority of my readers won’t hear me speak on this book, I wanted to share some of those thoughts with you. I also want to be extremely careful not to give away any spoilers, which is quite a task when I want to tell you everything. I will do my best to restrain myself.

I have an eclectic process I use to write a novel. It begins years before I write a single line of expository or dialogue. I usually have a protagonist identified and a very rough roadmap of a plot that will deliver that character’s arc, but even before I begin the detailed process of outlining, I start a page of ideas I call “collecting.” That can take a decade, or in the case of this book, several decades, because this book began as a long abandoned screenplay treatment I wrote in my 20s.

I share with you here some of the ideas and concepts I wanted to explore that landed over the years on that collecting page. Some of these have been transcribed directly from the many scraps of paper that got stuffed into my project folder.

It all started with the notion of the soundtrack of our livesto be fully confessional, the soundtrack of my life. I believe our music carries us through the bad times and encodes the good times. Each of us has a unique soundtrack depending on our years alive, but most of them overlap. I wanted to build a story sitting atop that premise.

That became the conflicted tale of Victor Selo, a onetime cover band guitarist become corporate refugee become cover band artist anew with remarkably higher stakes. Music both holds him together and tears him apart. His flight from the big bucks technology arena is meant to be an escape, where songs of the classic rock generation guide along the plot like a jukebox musical, but his personal history looms forever large. He trades one stage for another, large to small to ascending, not better, mostly different, equally pernicious.

I began framing his quest with a number of lyrical quotes, from The Beatles and The Who, and one special song from another band which would be a spoiler so I’ll have to let you discover that. The book’s title already hints at a giveaway. I wanted these lyrics to punch through the chapters, which you’ll discover are not chapters at all, but tracks from a concept album. Oops, another spoiler. I better quit while I’m ahead, or very soon thereafter.

I wanted to explore how we find the courage to do the right thing, especially when the choices are not clear, and the most obvious choice could easily have the most deleterious repercussions. We want what we think we want. We want what we think we deserve. We are usually wrong about both. We are not alone in enduring the consequences of what we bring on ourselves.

I wanted to explore the necessity of constantly starting over in life as a creative process. This might seem a bit counter-intuitive when applied to the building blocks of one’s personal growth, but it’s not really. We think a career is about piling one success upon another and hiding away the failures. Once you reach a certain age, you realize how wrong you were to think that’s how things work. Back to The Who in Quadrophenia (1973):

You were under the impression
That when you were walking forward
That you’d end up further onward
But things ain’t quite that simple.

When we begin from an empty palettefrom a hollow toolbox and an arsenal of absencewe have the unblemished opportunity to reassert our individuality and purpose. We sing the song of ourselves. We embrace the courage to risk exposure. We realize the comfort zone of complacency is the strangling curse of the zombie. We slay the zombie in ourselves before it forces us to wander the earth in purgatory sameness.

Good people can be corrupted under stealth compliance when they prioritize the essence of survival over the illusive ideal of needing to thrive. We all do it. We have to do it. There are hidden crossroads in our lives we can only see in hindsight. We have to choose at the fork in the road with the clock ticking, but we seldom see there is a real choice until after we have chosen. That’s when fate throws a party and the booze is bad.

I wanted to explore the full magilla of a Tyson-like knockout. You know Iron Mike’s saying, “Everyone has a plan until they get punched in the mouth.” When you’re lying on the mat looking up at the referee counting you out in a fog, how do you come back? How do you fight a different way?

It all circles back to creative destruction. We are dying to be reborn. It’s nearly impossible to figure out how until crisis strikes like a demon tornado on the bountiful plains.

If you peak too early, you can fall pretty far, pretty fast, and never find the net below the trapeze. When your dreams die, what do you do next?

While we’re at it, how do we combat the forces of mediocrity, the entrenched entitled protecting themselves from sharing the spotlight with a new voice? Can we courageously take on the sins of self-propelling governance, the greed and avarice of short-term thinking, the material byproducts of genuine innovation that create conflict where instead there should be celebration?

I wanted to wrap all that in the conceit of a song cycle, a hard rock concept album that holds together on theme. I wanted to pick an argument with eternity, crawling toward faith where it hides in our sorrowful fears.

In the end for a storyteller there is only relevance and irrelevance. Anne Lamott explained it in the simplest of all statements: “No once cares if you write, so you have to care.”

I care a lot. I hope you see that in this unusual trek through multiple backdrops and the obstacles we overcome in the search for ourselves. If you want to read a more detailed synopsis or a few brief excerpts from the text you can link to that here.

I’ll see you at the after-party. I’m told the top shelf will be pouring in the green room. I’ll be tuning Victor’s guitaror maybe carrying his practice amp to a late night no-cover lounge in Vegas.

My Third Book: From Nothing

Writers by affliction are an idiosyncratic lot. Other than a willingness to spend an enormous amount of time alone and a preternatural love of language construction, we don’t have all that much in common. We write about different things, from the historic lives of dead people to the ponderous calculations of romance that could never live up to its description. Some of us have enviable discipline in reserving hours for our craft day in and day out. Others are beasts of procrastination who binge occasionally in overnight typing sessions while devoting daylight hours to cleaning out pencil-stuffed drawers and ceiling fan lint. An author on tour may enjoy speaking publicly, while another cowers at facing readership in the form of human flesh.

We may share a passion for literary achievement, but we are in few ways the same. One bit of sameness has occurred to me exactly three times, each when I’ve finished one of my novels. When the final copy-edit has put the book to bed and readied it for your consumption, I’ve invariably asked myself the same simple question:

“Why did I do that?”

The existential query is unavoidable. Why does a writer remain dedicated to the challenge of completing a book? I am guessing I am not alone in that meditation. It is impossible to think that most of my colleagues and the legions of our predecessors have not asked themselves the same thing. It’s a heck of an endeavor, for most not particularly lucrative. It disarms the writer to a battalion of transparent critics, and the incomplete satisfaction is resolved only in the reborn commitment to attempt it yet again.

So I ask you, as you are likely to ask me: Why bother?

To say that we are without choice in the matter may sound glib, but I am afraid that is the only reasonable answer I can muster. We do it because we can’t not do it. We do it because there is something inside of us that needs to ferment and emerge, to escape the confines of a sole mind and become part of a shared consciousness. If we could avoid or redirect this need many of us would, but we cannot, and so we sit, ruminate, draft, and revise. Somehow the new book becomes complete and we are ready to share it, with the best of intentions. For me, happily that time is now, and I hope the new work resonates with some of you the way its voice called out to me.

I am glad it is done. I am honored to share it with you.

It has been a fragile three years in the making. It was delayed partly by life’s interruptions and partly by my need to pick each word at least a dozen times. I may not have the discipline to write in predetermined sections of each day, but I do have the discipline to embrace each of my sentences before I toss them to you. It’s nerve-wracking. It’s time-consuming. It’s exhausting. I know of no other way to do it with pride.

From Nothing. That’s the title, and sort of where it came from — out of nowhere, yet grounded in a collection of moments I have known or expanded in scope. Should you choose to read it, you’ll discover in more detail why I called it that.

It’s the story of why a life becomes a story, how that story is guided concretely and through alchemy, and why some stories are better than others, even if they didn’t set out to be something more than assembled emotions wrapped around an evocative philosophy.

Weird stuff, huh? The problem remains that it’s difficult for an originator to talk about the plot and characters in a book without giving away any spoilers or making light of one’s own intentions. Allow me instead to dance around a few of the book’s themes.

Technology: Yes, it’s me again, come to take you inside the empirical land where I earn most of my living. This is the universe of creative destruction, where bad things have to happen to otherwise good people for progress to have its way with all of us. At the same time, bad people have a way of making these spoils the treasury of their own private club, and the best most of us can hope to do is stay out of the way of the greedy stampede when it targets our cubicle. Change comes with ugly intervention and nasty byproducts. We then quickly abandon the carnage, cash in whatever chips are left on the table, and reinvent ourselves in our evolving world.

Bar Music: I hope you like piercing lyrics and backbeat as much as I do. Sound is at the heart of this novel. We’re still digesting the baby boom, the soundtrack of our lives, the guitar-hero worship that came and went as fast as any other craze but lingers in the possibility of ephemeral ambition. I spend a lot of time thinking about music, and in this tale I devote a lot of pages to unwrapping composition. The songs connect the dots, even when the dots don’t want to be connected and would rather fade into the Milky Way. I have my favorites and they may not be yours, but our immersion in star-quality memories holds us together. That makes for songs that matter.

Redemption: This book has been a strangely spiritual journey for me, more unmasking than I have attempted previously and certainly more uncomfortable than I intended. The protagonist, Victor Selo, has a troubled life that he finds ways to overcome on the surface, yet he can neither come to terms with success nor adequately interpret loss. He makes a lot of mistakes, stumbles through a litany of lifetime accidents, and where he learns from some misdoings, the ultimate assessment of moral right and material wrong forever confounds and eludes him. Theology and philosophy are a tight couplet in our curious canon. I know I have done no better a job of answering the unanswerable than any before me, but perhaps I can open a different door for you to the unquenchable struggle.

So there you have it, a new book is born and with my deepest hope on its way to your hearts. Reserve a copy, read it when time allows, and let me know where we are and aren’t on the same page. With any luck I’ll be back again in a few years with another adventurous yarn, asking myself why I once again committed to the improbable. Much of that will always be up to you, more than you will likely ever know.

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Publication date is June 12, 2018. If you would like to review an advance reading copy please contact my publisher, The Story Plant, or via email: thestoryplant@thestoryplant.com.

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A Brief Excerpt from Track 2

When Victor awoke it was dark. He looked around and the parking lot was filled. He recognized a third of the cars from the office parking lot. Full Stack Max’s mustard yellow minivan, dents on three sides. Code Machine Clarence’s jacked up Escalade with the shotgun bucket seat usually toting that new kid, QA Juan. Admin Darcy’s prized lime green Prius gleaming under security lights as if she had driven through the car wash on the way there. The familiarity was comforting. At least some of them had come. He was head to toe in perspiration but relieved in the dashboard’s digital transmission that it was after 7:30. People inside would be singing. There would be friendly faces. Inside Providence it would be safe.

Victor had slept in the car almost six hours. That was odd. He really was drained, more than he had thought. As he mustered the courage to open the car door, a tap came on the half-open window. The face beyond the glass was unfamiliar to him.

“You okay?” It was the voice of a man perhaps a decade older than him. Victor looked at the stranger, his plain grey T-shirt, blue-black lumberjack flannel overshirt, vintage khakis, stubble beard, untrimmed mustache and mutton chops. It was a programmer look, but Victor knew all the programmers at Global Harmonics and they were the only programmers who came to Providence. Who was this guy?

“I’m fine,” replied Victor, not yet finding the energy to move.

“Come on inside, you look like you could use a drink,” said Mean Master Muttonchops.

“Yeah, I’m coming. Do I know you?”

“You don’t. My name is Thomas Katem. I’m an investment banker.” He handed Victor his business card through the open window slot. “You’re Victor Selo, right?”

Victor eyed the card for familiarity and put it in his damp chest pocket. “Have we met before?”

“It’s possible, the circles we travel overlap. Unfortunately your meeting at Global Harmonics was over before I got there. Late to the slaughter, the way I heard it.”

“Your loss, we put on a good show. You don’t dress like an investment banker.”

“It’s afterhours. I carry a change in the car. Doesn’t everyone around here?”

“You think I need to clean up before we go in?”

“Nah, come on, I’ll buy you a drink. I’ll bet you have friends inside.”

“We’ll find out.” Victor opened the door and got out of the car. Strangely, the asphalt felt comforting under his feet.

As Victor walked through the doors beside Katem, Providence was in full swing. In all the day’s drama, he had forgotten this was Friday, Live Band Karaoke Night. A warm fall weekend was getting under way. Tonight people wouldn’t sing with a machine, they would front a cover band. It was what made Fridays special, particularly for anyone who had abandoned a long-ago dream.

At the mic was possibly the worst Elvis impersonator of all time, a grey ponytailer doing his best to belt out “Viva Las Vegas” with more stage drama than musicality. He wasn’t an awful singer, he could work his way through a tune with credible intonation. He just didn’t sound anything like the King. He didn’t look like him either, beyond the tattered white sequined jumpsuit. Elvis recognized Victor from across the room and raised the mic stand to him as he entered. Victor waved briefly, then crossed toward the bar with Katem a half step behind. Elvis found the segue to a low pitch baritone interpretation of “Love Me Tender.”

“You know Elvis?” asked Katem.

“His name is Johnny Olano. He lives for this. Friday is his day. Three Elvis tunes, five shots of tequila, and he never goes home alone.”

“He must be seventy, maybe seventy-five,” observed Katem. “How does he pull off that trick?”

“Welcome to Providence.” Victor motioned the bartender with two fingers and was handed a pair of Coronas. Few of his colleagues in the bar were making eye contact with him. A few nodded slightly his way, but his usual warm embrace wasn’t to be found.

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The Many Lessons of Andy Grove

Time 1997We lost a great business leader earlier this year. His name was Andrew S. Grove, known to many as Andy Grove.

He survived Nazi-occupied Hungary as a child, then Soviet-controlled Hungary, immigrating to the United States at the age of 20 in 1956.

He received a Ph.D. in chemical engineering from U.C. Berkeley and became a star engineer at Fairchild Semiconductor.

He left the stability of Fairchild Semiconductor with Silicon Valley legends Robert Noyce and Gordon Moore when they co-founded Intel. Together they later entirely reinvented Intel from a manufacturer of memory chips to the dominant producer of microprocessors.

He was Intel’s CEO from 1987 to 1998, the famous “Intel Inside” years when personal computing exploded from the hobby to the consumer market.

He wrote the legendary book Only the Paranoid Survive, published in 1996 and still a must-read for anyone who wants to understand innovation and the power of creative destruction.

For many years he co-taught a course in strategy with my dear friend Robert Burgelman at the Stanford Graduate School of Business.

If you think everyday people always had the internet, email, streaming video, and smart phones, you have a loose grasp on current events, let alone history. Andy’s leadership at Intel took us from the 8086 to the Pentium chip, from monochrome to color displays, from floppy to CD disks, from no hard drive to software that could be installed.  If you didn’t live through the transformation of the universe from analog to digital, from buying hardware and software at Computerland and Electronics Boutique to Best Buy and Costco, it’s hard to explain the magnitude of this growth cycle. Andy is one of those guys who really changed the world.

Okay, you get the point, about 0.001% of mortal beings have a resume close to his. You can read his full bio on Wikipedia. I want to share something more personal about him, the key takeaways from the few times I met him in person during roadmap briefings at Intel in the 1990s. Among the many lessons I learned from Andy Grove, here are five that continue to guide me daily:

  1. Creative Destruction Is Real – Whatever product you ship today is already obsolete, no matter how well it is selling. If you are not working on the replacement for it, someone else is. That is why you have to be paranoid. You will always be correct if you presume you are about to be outperformed in the marketplace of goods and service. Never get comfortable, never rest on your laurels, or you will be gone in a heartbeat, wiped off the map while you are collecting your awards for last year’s success. I learned from Andy that almost every startup that presumes it is built to last is almost certainly on a crash course with obsolescence, that the vast majority of even robust corporations today last about half as long as a human life. Companies don’t reinvent themselves, they are reinvented by courageous, visionary people.
  2. Beware the Strategic Inflection Point – By the time a market has fully morphed at scale, it’s way too late to react. You can’t see a strategic inflection point coming, you can only acknowledge it in hindsight while confessing your memoirs. Sorry, Monsieur Business Plan, the landscape changes in real time! Because you have learned to be paranoid, you are going to figure out one dreary morning that something you are doing in your company is hugely wrong. Some product you are readying for release is going to tank no matter how much you spend on marketing. Remember when Bill Gates discovered the internet? Remember when Mark Zuckerberg discovered mobile? Those were Intel-inspired moments. They turned their companies on a dime the same way Andy helped turn Intel on a dime when they realized the market for memory chips had commoditized and microprocessors were the way forward. I learned from Andy to always remain nimble, that sunk cost is always sunk cost, eat it and move on. Achieving competitive advantage before others see it coming is where your investments must be all the time.
  3. Science Is Inescapable – No matter what your market cap might be, you can’t fake math. Pithy slogans don’t make better computers, engineers do. For Moore’s Law to work (roughly twice the computing power will be available every 12 to 24 months for the same cost) staggering volumes of calculations have to take place on a tiny silicon chip without the transistors melting down. If you want to win at the engineering game, it takes the boldest and brightest team of advanced engineers you can assemble. They need the time to do the math, which is why Intel was already designing the 486 chip while shipping the 286. You can’t predict when the equations will be solved, you can only form a thesis and test your working models until they clear quality assurance. I learned from Andy that there are no sustainable shortcuts in quantifiable outcomes, the minimum viable product be damned! If you try to cheap your way through a poorly constructed algorithm, science will have its way with you and the result won’t be a proud moment.
  4. Constructive Confrontation Works – A lot of people who didn’t grow up in the Intel culture found it an impossible place to survive. Intel was a place where undisciplined, random conversation was never the norm. Almost anything anyone said could be challenged directly and aggressively by anyone in the hierarchy. Even when you were visiting Intel as a channel partner, anything you said could get shoved down your throat as instantly as you said it. Was this nice? It wasn’t meant to be nice. It was meant to improve products, driving ceaselessly toward unattainable perfection. That was how Intel maintained design and manufacturing leadership for a generation, by always challenging assumptions, never accepting compromise or forging an unholy consensus simply to move on. It isn’t the right culture for everyone, but at Intel, you bought into it or got your walking papers. I learned from Andy that in constructive confrontation, it’s always the idea that gets attacked and never the person. You might feel that you are being attacked, but you aren’t. Your ideas are being made better or mercifully eviscerated.
  5. Resilience Is a Mandate – Imagine a guy who made it from the Holocaust to the highest level of American thought leadership—all the obstacles, all the challenges, all the knock-downs, all the reinvention. To embrace the example of Andy Grove is to embrace the notion of resilience as the single greatest motivator available to anyone at any stage of emergence. You don’t give up, you don’t give in, you don’t quit. You always expect more from yourself. You learn from your mistakes, you study your failures, you learn from your adversaries. Want to survive? Want to triumph? Want to leave a legacy? There is no other way. I learned from Andy that you stay in the game, you look forward at opportunity, and you try again—only harder. Resilience isn’t a nice-to-have. Resilience is fuel for the soul.

Andy was a living example of realizing possibility through discipline. It is extremely rare to find an innovator with startup DNA who can personally evolve into the CEO of a multinational corporation. It is equally rare to find a top-notch engineer who embraces consumer marketing as a key strategic initiative. Andy championed the “Intel Inside” campaign as a branding mechanism that made an otherwise invisible component a necessity for personal computer manufactures to tout. When the consumer press seized upon an obscure failing in a sample of Intel microprocessors, Andy accepted the criticism as a byproduct of his brand promise. He insisted his team correct the deficiency with renewed quality assurance rather than defend the company’s position with arguments the consumer would never understand. He was book smart, business smart, and street smart all at the same time. He gave back way more than he ever took off the table in every way imaginable.

If you ever worked on one of my teams, I probably bought you a copy of Only the Paranoid Survive and quizzed you on it a week later. Andy’s words, thoughts, and ideas remain that important to me. He was an industry icon and a human being impossible for me to forget. I hope none of us ever forgets Andy. He remains a truly one-of-a-kind inspiration.

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This article originally appeared on The Good Men Project.

Photo: Time Inc.

Stop Dropping the Ball

MittBallI get called frequently to help companies with their brands. Usually this involves helping identify the competitive advantages in products and services, articulating the unique selling proposition around innovations that constitute a customer promise, and then devising a sustainable communications strategy around that promise. That’s the hard part.

There is also an easy part. At the potential obviating of substantial advisory services going forward, here is an exceptionally simple way to solve half your problems. Ready? This applies equally to your personal life and your professional life. Copy and paste the following two words on the palms of your hands so you can see them every hour of every day:

Follow through.

Yes, it is that easy. A brand is a promise. There are three potential paths that follow a promise: (1) you fulfill the promise, wherein you satisfy and keep a customer, at least until someone leapfrogs you; (2) you exceed the promise, wherein you create an evangelist who markets for you; or (3) you violate the promise, wherein you create nasty noise in the marketplace that speaks ill of your offering at every possible turn.

When you break a business promise, you undermine the brand. When you break a personal promise, you undermine your own credibility. This is not negotiable. This is as hard-core real and irreversible as it gets. You need to follow through.

Here are several recent examples of broken brand promises:

  • My wife left her mobile phone on a plane. We went to baggage services. They couldn’t find it. They said they would call us the next day. They didn’t.
  • I went to pay my health insurance bill online as I do every month (I’m told recurring billing is for some reason not available on my plan). This time the system was broken. After on hour on the phone, I got a customer service representative who said she saw the problem in their system, that it would be fixed in 24 hours, and she would call me back. She didn’t call me back, and it wasn’t fixed. A week later I called again and began the process anew. This time another rep gave me entirely different instructions and said he had no idea why the previous rep had instructed me as she did.
  • We hired a contractor to do some work at the house. He didn’t show up. He didn’t call. When we rescheduled and he did show up the next time four hours late, my wife asked why he missed the previous appointment and was now four hours late. He said, “Well, I’m here.”
  • I filled out a time sensitive form online with a state agency. About a week later, I received a personalized letter via snail mail acknowledging my inquiry, conveying that the signer of the letter would get back to me promptly with an action plan. I never heard from him again.
  • A journalist for a high-profile financial periodical contacted me by email to conduct an interview about my book. I agreed and suggested a time. She asked if I could change that to a time that was more convenient for her and I agreed to that time. I gave her my mobile number. She did not call me at the appointed time. After 15 minutes I emailed her and asked if we were still on. Two hours later she emailed and apologized for missing the call because of an emergency. She asked if she could email me the questions. I said yes and she said she would send them. She never did.
  • A producer from a media company emailed me an inquiry to help his company launch a new venture. I said I would be happy to talk about it and suggested some times. I never heard from him again.

Yes, I know, everyone is busy. It’s completely normal to leave loose ends open in our fragmented, email overloaded lives. It can happen to anyone. It’s perfectly acceptable to leave people hanging if you have a good excuse. They will forgive you as soon as the words “I’m sorry” cross your lips.

Baloney! You’re living in a fantasy world if this is what you’ve convinced yourself, no matter if you are a rookie or a veteran. And you’re not as good as you think you are. Not even close. Otherwise you wouldn’t have left me blowing in the wind to be picked off by a competitor.

Winners say what they are going to do and then do it. I don’t care if you have to make lists of your lists. If you aren’t going to do something, don’t tell someone that you areand you’re scot-free off the hook. If you say you are going to do something and then you don’t do it, you lied. Yes, you lied. Or your company representative lied. And by transitive logic, your company lied. To a customer. That is the customer’s perception.

Think you can buy a big bubbly bag of advertising to win back the trust of that customer? Have fun calculating the ROI.

Think you can apologize and win back my trust? You can’t.

Maybe I have choices at the moment, maybe I don’t. If I don’t have choices now, I will soon. That’s what creative destruction is all about, old failed systems being replaced by better ones. Constraints on distribution are lifted from entrenchment every day. No matter what you have to offer, no matter how good you are at what you do, if you don’t show up as promised, you will be replaced. No one will feel sorry for you. No one will bat an eye when you crumble under your own incompetence or arrogance.

This really isn’t hard. In fact it’s as easy as it can possibly get. Make a promise, keep a promise. Follow through all the time. Do that and call me for the other half of your brand problems.

Public Service Made Customer Service

Earlier this year on The Daily Show, Jon Stewart asked Nancy Pelosi a rather awkward question: In effect, can our government still do big things? She never really answered the question, which was also kind of awkward. I don’t think she saw it coming. He was really probing into the nature of government competence and our ability to trust elected, appointed, and civil service employees to be great at their jobs and exceed our expectations. It was not meant to be a partisan question, but somehow that’s where it went, which sort of ducked the broader concern, which sort of reinforced his critique.

Like I said, it was awkward, and it got me thinking, why should the output of government services–or public service–not be subject to the same expectations of for-profit customer service? I have been chewing on this for weeks, and I can’t come up with a decent response. I serve in a volunteer role in local government, so I guess that makes me part of the problem, but it also drives me to be part of the solution.

The obvious retort will be that absent the free market and competition, any single point option will more than likely descend into mediocrity as a result of monopoly and entrenchment. I don’t think it’s that simple, because for-profit and non-profit enterprises are both constantly under attack by creative destruction, which when ignored is an equally powerful remedy to mediocrity. Improved methods will obviate the obsolete; it is only a matter of time and catalyst.

Global EntryThis past month I experienced a pleasantly opposite case, where public service did exceed my expectations–with expedience, practicality, and cordial handling. I applied for Global Entry, the Trusted Traveler Network administered by the U.S. Customs and Border Protection Agency. I went to their website, filled out the form in less than half an hour, was promptly notified online of conditional approval, and asked to sign up for an in-person interview at LAX. I quickly discovered there was a three-month wait for an interview, but the site suggested I check back frequently online for a cancellation. I got one within 48 hours for an appointment the same month, went to the interview, was promptly welcomed upon arrival (I was early and they took me when I got there), and ten minutes later I was fingerprinted and done. I was approved online that afternoon. Perfect.

This was exemplary customer service in action. It was almost as if Border Patrol had set out to prove that customer service was still possible within our government where there is an expressed commitment to make it so. They have my applause. I don’t know if I can award them my future business or ongoing loyalty given their scope of offerings, but just like writing a positive restaurant review on Yelp, I am giving them the loudest shout-out I can in as public a forum as I can, which is how the customer service game pays back winners with referrals.

I couldn’t help but compare and contrast that with several other recent observations of public service that simply haven’t embraced that ethos:

HealthCare.Gov – I usually focus on the broader issues of healthcare, which matter more to me than a broken website, but like Jon Stewart in the Nancy Pelosi interview, let’s focus for a moment on the website fiasco. Not only didn’t it work, not only was it impossible to navigate even when it did work, those in charge of deploying it allowed themselves to get fleeced by private-sector contractors. When you run a business with customer service in mind, you are compelled to keep your costs low and be a subject-matter expert before you offer service paid for by your customers. We are the customers of HealthCare.gov. We overpaid and we got a poor experience. Not good customer service.

Jury Duty – It makes us shiver, but it should make us proud. Anyone who gets the notice in the mail immediately starts to hedge, not because they don’t want to perform public service, but because our historic experience of this form of public service is that it is wildly inefficient. How long ago was this antiquated system designed, where you sit in a room all day doing nothing, waiting to be called or released? Yes, it has improved modestly with online registration and log-in, but when I recently spent a full day in a room of 125 people doing nothing of value, and fewer than two dozen of us were used at all, I wondered how it was possible to justify the lost productivity of 100 people times 8 hours, or 800 person-hours gone up in smoke in just the room I sat. It’s so wrong that no sustainable business could ever tolerate it, nor pay for it. If you want me to provide public service, start by seeing me as your customer and commit to process engineering so that my participation is truly of value.

Governor Christie’s Off-the Ranch-Staff – There’s a reason the obscene obstruction of a New Jersey bridge continues to ride the headlines, and it’s not just politics as usual. I use the word obscene purposefully, because using any position of public authority to harm rather than help a constituency goes against everything our democracy represents. When a public servant forgets that his or her salary is paid by the people and not the political party, all bets are off. Maybe there should be a slightly tweaked Hippocratic Oath in government: “First do no malfeasance.” If you go to work with full acknowledgment that you are in public service and your job is to provide customer service to those forking over the dollars for your gig, you couldn’t pull the trigger on anything like this, look yourself in the mirror, and say. “I did what I was supposed to do today.” When you do harm for personal gain, you add no value. You make a mockery of the privilege of serving those who trusted you.

When I was kicking around some of the themes for this post on my Facebook page as I often do before writing a new article, someone posted on my news-feed that it was a silly use of my time to write about stuff like this, because it never changes. Private-sector contractors will fleece the government, no one in the court system cares if they waste our time, and politicians will always use their power to reinforce their authority. I don’t think that’s true, and my experience with Global Entry is proof that we can do better if we make it a goal.

If we refocus the orientation of public service to be around customer service, it de facto has to improve. Perhaps more importantly, if we don’t keep tabs on the kinds of small to medium items called out here, how can we possibly have faith in the really big stuff entrusted to government: national security, fiscal solvency, social justice, and the like. There has to be a service model underlying all these tasks, subject to scrutiny, objective benchmarking, and listening to the customer. No, we’re not going to vote on what constitutes a valid TSA safety post or police DUI checkpoint, but we should always expect to be treated with courtesy when authority is surrendered for the greater good. Authority should be enacted with reason, humility, and respect so that it wins our buy-in and loyalty. Our aim should be to inspire all contributors to do their finest work all the time, to demand it of themselves as an absolute, to seek constant improvement of systems, teams, and individuals.

Think about it: virtually every customer-facing business now asks you to rate every experience you have with them, and the smart ones deploy this feedback almost in real-time to win competitive advantage. Start rating your experiences with public-service agencies, whether they request it or not, and not just at election time. Demand better and we will get it, maybe not in real-time, but sooner or later creative destruction does its job and washes away the ancient with one flavor or another of much celebrated reform.

And don’t forget to say Thank You when you catch someone doing something right. Everyone likes to get a thumbs up when it’s earned!