“The Channel” to Nowhere

Posted on Thursday, 10 November 2011 9:00 am by markpilip

Why do you sell through distributors, resellers, VARs, or in other words, “the channel?” Is it worth your time building lots of infrastructure to manage the rules around distributing your product, dealing with channel conflict, commissions, “owning the customer” and so on?

In other words, is it worth your time tying your brand to organizations that are only in it for the money?

Perhaps so, if your product is a long-tail undifferentiated thing that you want to sell at low margin to as many people as possible.  But all those mass-market customers could buy your thing or the other thing, depending on the price and how hard “the channel” wants to try.  And the effort the channel puts into it is usually a function of how much you want to pay them to do so, in either dollars or rights to your IP.

Or is it worth your time to craft the products and services that customers who believe as you believe really need and want?

In the former case, you can be HP and spend your time building distribution networks and the infrastructure to mass distribute serviceable and capable product.  And earn so-so margins and no loyalty by selling them to whoever needs a beige box of mediocrity.  And deal with channel conflict, constantly.  In the second case you can be like Apple and spend time getting rid of your distributors and deal with everything yourself, selling products to people who believe as you believe and earn fanaticism, margins and market capitalization.

What do you choose?

Posted in Customer Care, Organization, Product Development | Tagged , , , , | 3 Comments

Stock Quotes on Home Pages

Posted on Tuesday, 8 November 2011 5:08 am by markpilip

What does it say about a company which prominently puts their stock quote on the home page of their website?  The guys who really own your stock–the institutional investors, hedge funds, and so on–don’t get their quotes from your website.  They’ve got a Bloomberg terminal on their desks.

I think it says the company is a little bit clueless.

Posted in Philosophy | Tagged , , | Comments Off on Stock Quotes on Home Pages

No Press Didn’t Kill Your Product

Posted on Monday, 7 November 2011 5:01 am by markpilip

Products fail in the marketplace all the time.  There’s a couple of main reasons why, but I’ll tell you why they didn’t fail:

  1. Marketing
  2. Corporate Communications

All the marketing in the world can’t make a crummy product work.  Look at the RIM Playbook.  All the PR and media hits in the world can’t turn a flawed product into a success, as Iridium learned a number of years back.

I subscribe to Kevin Hartley’s theory that the 94% of products that fail in the marketplace are due to two reasons:

  1. The product launched.  The customer didn’t care.
  2. By the time the product launched, the cool idea had been rounded off.

In the first case, you just missed the mark.  The Zune was launched aggressively by Microsoft and didn’t get so much as a yawn from the marketplace.  The product didn’t do anything for the target customer and all the marketing dollars in the world couldn’t save the Zune.  And don’t think “Apple had first-mover with iPod” either.  Bunk.  Diamond Rio, NOMAD, Archos, etc. had plenty of lead time over Apple.  They just sucked. 

In the second case, the internal process doomed it.  One more feature, three more buttons, some legal copy (just to be safe, mind you) and you’ve churned out one more generic beige box of mediocrity.

I’ve been tasked to try to sell stuff that nobody cared about. The post-mortem “but if marketing and PR did their job….” crying drives me nuts.  Yes, strong marketing and PR will help maximize sales and profit and it’s a critical part of your product launch. But nobody will publish stories on crummy products, nor will people view the ads and buy the thing. Sorry.

Takeaway:  Want to sell more stuff?  Stop blaming marketing and communications.  Make stuff people want.

Posted in Branding, Marketing, Product Development, Rants | Tagged , , | 8 Comments

Steve Jobs Sets Back Leadership 20 Years

Posted on Friday, 4 November 2011 7:50 am by markpilip

Steve Jobs is one of my heroes and a man who achieved his objective of “putting a dent in the universe.”

I enjoyed reading Walter Isaacson’s biography “Steve Jobs” because it gave me insight into the motivation behind the man who changed my world and was the Henry Ford/Thomas Edison of our time.

But this book is a biography, not a leadership book.

The problem is a lot of managers–forgetting that they are not Steve Jobs–will read this as a leadership how-to.  Almost every technique that Steve used is the exact opposite of what we should be doing.

Steve’s reality distortion field extends beyond the grave.

While reading the book I often found myself thinking, “Yeah, that’s a great idea–when I get back to work on Monday, I’ll starting doing…..”   Twenty minutes later while wandering around the house, I’d say “What?  That’s the dumbest thing ever because it violates my core beliefs and leadership principles.”

Those ideas came to me from Steve, funneled through Isaacson and read in my living room on my iPad.  Putting a unique spin on reality from the afterlife is something only Jobs could pull off.

Think of this book as the Guaranteed Employment act for Organizational Development teams, executive coaches and leadership trainers.

What I hear in my head now is the sound of less self-aware leaders firing up Steve’s “hero-shithead rollercoaster” and preparing to execute Steve Jobs in their workplace.  My prediction is that damage will be inflicted on organizations by managers misreading this book, and it’ll take five years or more to undo.

My take:  The book is a compelling read of a great, but flawed, visionary.  Read it as a biography and enjoy it.  Then do (mostly) the opposite.

Chunka Mui has a terrific take: “Five Dangerous Lessons to Learn From Steve Jobs.”  Recommended reading.

Posted in Leadership, Philosophy, Predictions | Tagged , , | Comments Off on Steve Jobs Sets Back Leadership 20 Years

Problems With Good Ideas

Posted on Monday, 31 October 2011 8:08 am by markpilip

Good ideas have two major problems.

  1. They spread.
  2. They divert attention from bad ideas.

Let’s look at the first problem with this image as the illustration.  Regardless of what you think about the Occupy movement, you’ll have to agree that it’s definitely spread.  During a recent visit to Utica College I picked up the flyer on the right.

What’s interesting about Occupy Utica (and the other Occupy events) is that it didn’t require a long series of alignment meetings.  No top-down executive mandates.  No brand advertising campaigns.  None of the things, in fact, that one normally thinks are needed to get people to adopt an idea or buy a product.  I’m pretty sure there’s nobody actually in charge of all this, nor do they have any marketing dollars.

The Occupy movement is spreading because it’s a good idea.  People like it and they are willing to make the emotional investment in the idea and take their beliefs to the streets.

The second problem with good ideas is diversion of attention.  Last month, I wrote that I believed that good ideas plus attention creates the opportunity for leadership.  When good ideas come up and begin to spread, you have two choices.  Ignore the idea and continue on doing what you were doing, or pay attention to the new thing.

If you ignore the new idea, you may miss the train.  But if you pay attention to the new idea, you are going to have to make time for it and something else must suffer.

So what’s the problem with good ideas?

Simple.  If your idea is bad, or even just not as good as the other competing ideas out there, something better is going to get attention and resources. That competing idea will collect a better team faster than the alternatives and will grow more quickly.  Your idea–even if an OK idea–will die in the face of better options.

So if you find your idea flagging and not getting the attention you believe it deserves, maybe there’s something better out there.  And you’ve got a decision.  You can adjust your idea to make it more compelling.  Or you can can put your idea aside and join one of the better ones.

In either case, you’ve got to decide.  The quicker you take action, the overall quality of all ideas will go up.  The world needs better ideas and more people supporting good ideas.  Don’t wait around!

Posted in Leadership, Organization | Tagged , , | Comments Off on Problems With Good Ideas

Two Types of People

Posted on Wednesday, 26 October 2011 7:58 am by markpilip

There are two types of people in the corporate world.

  1. Those that ship product.
  2. Those that explain how they’re planning to get a team together to build the requirements to gain the approval to get the funding to hire the consultant to choose the vendors to tell them how many headcount to build the deck to get the executive buy-in to get the mandate to ship the product.   (Which they’ll do at their next job.  Right.)

Be the former.  Ship. Interact with the market. Win.

Posted in Career, Leadership, Philosophy, Rants | Tagged , , | Comments Off on Two Types of People

Why There’s No iPhone 5

Posted on Thursday, 6 October 2011 5:45 am by markpilip

Now I know why Tim Cook didn’t introduce the iPhone 5.

I believe that Steve Jobs, ever the thinker and ever the showman, is playing out his final and best script. And while doing so, he completes the smooth transition of Apple to Tim Cook.

Once we finish mourning Jobs, at some appropriate time, Cook appears from the shadow of Steve with “one more thing…”. The iPhone 5 raises the bar, the Cook age truly begins and Apple moves on.

Brilliant move by Steve. RIP. We won’t see another like him for some time.

Posted in Uncategorized | Tagged , , | Comments Off on Why There’s No iPhone 5

Crack Open an Academic, Find an Entrepreneur

Posted on Tuesday, 4 October 2011 5:09 am by markpilip

At PWC’s Diamond Exchange yesterday, where I am the dumbest person in the room and loving it, I heard an interesting assertion by Justin Hall-Tipping.

He said that “all university professors are fundamentally entrepreneurs.”  After all, where else can you find people that are perfectly OK with new ideas which have 99.99% chance of failure?  Further, where else but at universities can you find people that are dedicated to creating new knowledge and capturing the elusive lightning and bottling it?  And this is done by hard work lasting years and years by people who are also willing to admit the idea wasn’t workable and can move on to the next thing.

In the business world we’re saddled with the average stock being held for just 7 months and corporate cultures where failure–of any kind–is often met with career death.  Is it any wonder that we’re great at creating wonderful exotic financial products that Wall Street can bet on and make billions of dollars quickly, yet thousands of children will die today for lack of a clean drink of water?

What could you do?  Work with some academics on hard problems.  Give them the time to test some theories and do the hard science.  Let them fail and win.

 

 

Posted in Philosophy | Tagged , , | Comments Off on Crack Open an Academic, Find an Entrepreneur

Lessons From Saguaro

Posted on Monday, 3 October 2011 5:01 am by markpilip

I spent part of Sunday on a nature hike in Catalina State Park, outside Tucson.  Like many visitors, I was in awe of the giant saguaro cacti that formed, in certain locations, a veritable cacti forest.

Our guide was extremely knowledgable about the flora and fauna of the Sonoran desert and regaled us with information about the saguaro.  One interesting story emerged that is relevant to us beyond botany.

Beginning with the late 30s and early 40s, researchers started noticing that many saguaro had a bacterial infection and were dying.  By the mid-60s the problem got bad enough that some were theorizing that the saguaro would be completely lost by the turn of the century.

Beginning in the 40s the war against bacteria was underway, with infected cacti being chopped down, sprayed with pesticides and so forth. Except those efforts were doing no good, nor could they.

You see, the root cause of the problem wasn’t the bacteria.  The root cause was the freeze of 1937 that damaged the cacti.  That damage enabled the bacterium to take hold and finish the job.

The problem with saguaro is that focusing on a 30 year window is short-term thinking.  Saguaro can live for 150 years or more.  It can take 50 to 75 years for one to start developing one of the side arms.  Things that happened a long time ago–like a freeze–can impact the saguaro far into the future.  More challenging is that if you don’t have a longitudinal view of the entire ecosystem–short term changes as well as longer cycle impacts, like droughts–you have trouble figuring out the root cause.

Sounds a lot like business, no?  Think of businesses that focused on short-term profits (Enron) and ones that refused to acknowledge long term trends (Kodak).  Sure, a little financial engineering wizardry worked for a number of quarters at Enron.  And thinking that digital cameras were too expensive or the quality too poor, didn’t hurt Kodak for a long time.

But eventually it all caught up with Enron, Kodak and others–too quickly to do much about it.  As I write, it appears as though Kodak has started the final death spiral.

So what did I learn from my hot walk in the desert?  First, that as a businessperson you have to be aware of the entire ecosystem if you want to have a chance at recognizing the root cause of macro changes.  Second, that one must consider a longer time horizon–both forward and backward–if we want to understand what actions to take.

Hard to do, but so necessary.  The benefits of being well-fit to the environment and taking a long, patient view?  A better chance of success.

Oh, and the saguaro?  It’s doing fine for now.  I’m pretty sure it will outlast us!

Posted in Philosophy, Travel | Tagged , , | Comments Off on Lessons From Saguaro

Someone’s Going to Sum You Up One Day

Posted on Friday, 23 September 2011 7:45 am by markpilip

I originally wrote this on October 2, 2009 on my Facebook account.  I just found it through Facebook’s new Timeline feature and thought I’d republish it here.

——————————————

Great opinion piece from Peggy Noonan in the Journal today. It’s about the need for the next generation of Cronkites and Murrows in the media, but worth a read for the very end:

“And they’ll have obits someday too. Their careers will be captured in eulogies, leaving their children proud, or not. In a way you’re writing your own obit every day. You’re making the lead paragraph positive and constructive, or not.

Someone’s going to sum you up one day. You want to live your professional life in a way that they can write good things.”

Someone’s going to sum you up one day, indeed. The summation won’t be about the quality of that PowerPoint presentation you’re working on today, nor how cleverly you slipped in that indemnification clause in a consulting agreement. They won’t publish the rate of return you secured on your investments, nor the brand of clothing hanging in your closet.

What did you build? Who did you teach? Who did you help? How many others will be able to stand on your shoulders to achieve even greater things?

Try summing up your life now. Like what you see? If not, start changing it today to create the source material for that summation. There’s no guarantee that you can start working on it tomorrow.

Posted in Philosophy | Tagged | Comments Off on Someone’s Going to Sum You Up One Day