A few minutes ago my cousin’s wife updated her Facebook status looking for updates on the explosion this morning in Bozeman. They live in Livingston, MT. Their radio and TV stations did not have anything.
I did like many others and went right to Twitter Search to get the update. Found a Livingston radio call-in show and am listening live now. It’s amazing how once again the people are way ahead of the media. I hope that the current status of no injuries or fatalities stays that way.
I have recently done work for a couple of IT services firms. One in NY and the other in Cambridge, MA. As a guy who has primarily been involved in product organizations over the years, the marketing challenges of services businesses were harder than I expected. Really – products are way easier to market than services.
The explanation is fairly simple – competition and differentiation
First, the competition for services is way more intense than for products. How many vendors of a specific type of technology can you find? In some product markets there are less than ten viable competitors. Like CRM or DBMS or Internet Banking – there are not that many credible vendors. Same is true for any goods you buy — be it electronics, autos, etc. But services – wow! There are hundreds of Web development shops in Greater Boston, and tens of thousands nationally. IT outsourcing may have some big names like Infosys, Accenture and Wipro. But there are several hundred firms of reasonable size outsourcing to India. Think of all of the law firms, doctors, dentists, advertising agencies and the like. So, I think you can make the point that services are, to a great extent, more competitively intense than products. That’s because it’s fundamentally easier to launch a services company. Just start signing up clients and you’re in business. Products take time to develop and bring to market. That means capital, which means fewer entrants.
The next issue is differentiation. Now, I can differentiate myself from the next guy. But when there are a hundred or thousand people in a firm with widely diverse backgrounds and capabilities, how can you differentiate them from the other companies with their merged hoards of people? Some firms, liked Goldman Sachs, are known to attract the very best and brightest. But in your average Indian outsourcing shop, how can you – the buyer – really understand how one group of people may be better for you than the next? And what about in two years when some of those people are at another shop and you’re working with new people?
That’s where you have to start thinking more like a consumer branding guru than a product person. Now you’re into the realm of true marketeers – where it’s not the feeds and speeds, features and wizbangs that get you noticed. Positioning must, by definition, be far more emotional and conceptual.
Look at Accenture – their brand is all about “performance.” Sure, you don’t have millions to put Tiger Woods into your ads, but Tiger’s just an image that goes with the positioning statement. What you don’t see them leading with is anything about their people being the smartest or most capable. In reality, they are not. Accenture has plenty of good people, but they are not on par with the tech folks at Google or the folks that worked at CTP and Sapient in their haydays.
Marketing of services is really about marketing the outcome. With Accenture the outcome is business performance. With IBM it’s innovation. With Infosys it’s about winning in the “flat world” – which means being global to win globally.
Most services companies don’t do this well. They describe what they do – not what they cause.
So many times I go to look up a company and take a run through their website to get an idea of who they are and what they do. More often than not I am thoroughly underwhelmed. It’s not for lack of effort – many of the worst sites I’ve visited were professionally produced with good design and graphics. Hey, they look like real companies. Most of the time what sucks is the content. The content is well written, in the sense of grammar and editing, but after about 2 minutes I’m practically begging for mercy. What’s my problem?
First, if I read one more absolutely worthless line like “we leverage our unique capabilities to drive strategic value for our global customers” I’m going to go break something… Really, WTF does that mean?? Your competitors say the same thing, so why not? That’s precisely the problem. They all say the same stupid, meaningless and impossible to prove crap.
Oh, but you put it in a CMS with RSS feeds and lots of flash – doesn’t that make it good? No – sucky content cannot be improved with technology or sizzle. It still sucks.
My friend recently took on a new career as a counselor at a well-known outplacement firm. He has learned more about marketing in 2 months than most marketers learn in a lifetime. Beyond helping with the transition process and giving his clients confidence to move forward, one of the first transformations he can accomplish is with their resumes. Recruiters and hiring managers don’t respond to stuff you find on most resumes. Why should your customers respond to the same level of crap on your site in in your collateral and presentations?
The problem with most resumes is that they focus on responsibilities (features) and not on accomplishments (benefits). Employers want to hire people with impact value. What was the result of your 10 years with XYZ corp? So what, you managed this function. What improvements did you make? Or, did you fail to move the business forward while it was under your care? If so – you’re not getting hired by me…
Instead of writing your site like everybody else – how about writing it like a resume? I can tell you right now that it’s very hard to do this well – but what things of value aren’t hard work?? It starts with a brief (2 sentences, max) summary of who you are. Then an exploration of your capabilities as told through your accomplishments. Let me give you an example.
I love to give my ex-employer Sybase a hard time because, well, they’re easy… Anyway, look at what they put in the image to the left This is what shows up on their home page. And actually this is better than what you find with most companies. Now, imagine if the what you saw front and center on their home page was the following:
Sybase’s iAnywhere mobile solutions helped McKesson Corporation save millions of dollars by delivering solutions that reduced calls for delivery errors by 97%, eliminated imaging costs, and reduced delivery claims by 30%. What can Sybase help you achieve?
As a buyer, CEO, business line manager or even technologist, which approach is more powerful? Which message might make you more interested?
What if all sites were written like resumes with accomplishments front and center, and perhaps a framework of capabilities to show where the successes fit in your strategy? Then, everybody could easily see that your old, features-oriented and tripe-laden site just plain sucks.
I’d love to give you examples of sites that do this really well, but I have not seen any recently. Have you? If so – let me know.
A few weeks ago I was at a meeting of NETSEA (New England Technology Sales Executives Association). The topic was on B2B sales optimization – a key topic in this time of uncertainty. At one point the conversation turned to an old and true topic — managing the mix of great, merely good, and lame sales reps that you find in most sales organizations. What was stunning to me was that this group of sales managers were rehashing a conversation that has been had over and over again. It comes down to a fairly simple proposition.
A very few reps will thoroughly thrash the rest of the team on a performance basis. In a smaller team it may be one rep – always 200% to 400% of quota, year-in/year-out. You don’t “manage” these gems. You get them whatever resources they need, when they ask, and you make sure that they get paid. You ensure that they get the recognition of the CEO and that they get lots of face time with the other leaders in the organization as needed. You only reign them in if they become disruptive to the organization and negatively impact the performance of others on the team. Otherwise, you cultivate them and give them the run they need to get the job done.
The solid performers — 90% to 150% of quota consistently — you manage (I won’t go into detail). The laggards are always there – never getting much beyond 70-80% of quota (or worse). No matter how well you recruit, somebody has to be at the bottom. They just lack the necessary sense to put the focus and effort in the right place. A big mistake many sales managers make is to put a lot of effort into moving the laggards into the middle. It can be done with some of these people, but the effort is usually pretty high for what is generally a small reward.
One person commented that when they fire an under-performing rep they often give the pipeline to the stars to qualify and close. I believe this is a mistake. Not that the stars shouldn’t get the opportunities — it’s just that most of the pipeline of your worst performers is trash. You don’t want your stars having to waste time re-qualifying deals. You don’t give the pipeline to your stars – you give them the biggest viable opportunities that really can be closed. You, or a telesales rep or some other resource needs to weed out the junk first. And don’t give your middle team the crappy pipeline either. That’s a quick way to defocus them and help them to miss their quota.
I’ll give you an example. One of the best reps I ever worked with was that good because he was brutal about where he spent his time. There were deals with a greater than 0% probability – even greater than 50% – that he outright ignored. Instead, he focused on the biggest deals with 70% or better (in his mind) close probabilities. Fewer deals in his pipeline, but bigger on average than all the other reps. Even if his total factored forecast was below other reps, he rarely didn’t beat them. It was a great example of the Law of Conservation: time spent on less important deals cannot be reclaimed, it is just transmuted into less time to spend on the better deals.
The answer was easy to see, but hard to apply. By ignoring many “good” deals and focusing solely on a few “great” deals, he was able to spend far more effort on the deals he pursued – and he won most of them.
This is hard to teach or to get most reps to do. Any deal with a pulse often gets attention, which makes it less likely that other deals will get the attention necessary to win them. We all feel we can cover lots of deals and make them work. The simple fact is that the general rule against being spread to thinly is critical to sales success, but often overlooked. Filling the pipeline with lots of crap gets your manager off your back – and it should be the opposite. A big pipeline with lots of deals, where each is a complex sales environment, should be a red flag. It’s a zero sum game because there are only so many hours in a day. Time cannot be created – it can only be applied. Applying time to crappy deals just leaves less time for better deals.
The Sales Law of Conservation: time cannot be created or destroyed, only transferred between competing priorities. Improving the quality of your pipeline by finding the best deals and working them more is preferrable to finding more deals and working them less.
Other than today’s widely hailed economic team unveiling, the press recently has been making a big deal over the “establishment” appointments being floated by the Obama transition team. The true liberals and “changents” are upset that a cast of usual suspects starring the Billory Clintons is getting the nod. For those looking for a radically different team, they will be disappointed.
Had PEBO (President-Elect Barack Obama) gone with some lesser-known but decidedly big-government liberal types, the establishment (including the financial markets en masse) may have blasted the inexperience and naivete of #44-elect and predicted the end of modern civilization as we know it.
It’s a classic Catch-22, can’t win, damned if you do… scenario.
By going with some tried and true characters – Clinton, Summers, et al – PEBO has the experience in the team to know how to get things done. By putting a pit bullish Rahm Emanuel in as COS, Obama is demonstrating that he’s going to be a driver and not a passenger (in contrast, W was asleep in the trunk most of the time while Rummy, Wolfy and the Neocons went joy-riding). Nobody knows yet how it will turn out, but I think most of the mainstream in the U.S. and abroad is happy to see some familiar faces in the Cabinet and advisors crowd during this once-in-a-lifetime crisis.
The only thing left to see is if PEBO will be successful in actively molding the presidency in his own, expanded-government conception. That will require some humilty on the part of a group not known for being humble.
Given the “no drama Obama” campaign, and Emanuel’s long whip and knowledge of how to use it, this may turn out to be time to say, in the words of Monty Python, “And now, for something completely different.”
So Jerry Yang has stepped down as CEO of Yahoo! This is no surprise. Yahoo! has been floundering for quite some time, and Jerry's much-vaunted return did not have the same results as the Steve Jobs or Michael Dell Parts Deux.
In many ways Yang had a much easier job than either Jobs or Dell, but he still punted it. Dell hasn't lit the world on fire, but you don't see him getting creamed by the press at every turn. Yang went mano a mano against a carnivorous Steve Ballmer and made just about every wrong move in the book. Now, I never really understood the MSFT/YHOO merger idea at all anyway. MSFT really should be focused on the cloud thing as the future of the platform and apps business and let the ad business swirl around them. Steve's not listening to me anyway, but my gut tells me Microsoft should extend their value proposition along the lines of strenght.
So, here's my recommendation for Yahoo! Hire someone who doesn't feel inferior about themselves. Yahoo is arguably the most undervalued property on the web because they are too focused on competitors and not focused enough on customers.
Yahoo search is okay, pouring billions into competing with Google is just stupid. Yahoo content – with their Sports, Finance and other great properties – is the crown jewel. Partner for search if needed – and just keep sucking away at whatever value proposition is left in the newspaper business. Who needs the Boston Globe if Yahoo can get better at local content.
Start with Yahoo! today, add a regional focus much like Craigslist (http://boston.yahoo.com anyone?), and hire local writers and editors to stoke the engine. Sports, money (perhaps buy the bizjournals.com businesses?), jobs, news, culture, etc.
Yahoo could pwn the Globe and all other regional properties. They could even use some technology to allow people to create their own "morning paper" that can be assembled into a PDF and printed at home (for those who like to have the paper in their hands).
Okay, Yahoo – hire me for CEO!
With the enterprise IT marketing going to hell in a hand basket, many people are asking what they can do now to keep the wheels on the bus. One way to make sure you stand out is to shift the efficiency vs. effectiveness formula in the direction of effectiveness.
That means that everything you do needs to be more about being effective than just being efficient. A horizontal sales and marketing focus is efficient. You can hit lots of companies in lots of markets with a horizontal technology message — bits, bytes, flops and all the rest. But, you can’t be very effective in any one customer segment with this approach.
Verticalizing your sales force is pretty expensive, and depending on the size of your operation, may not bring you the effectiveness you’re looking for. Before going that route, consider verticalizing your marketing. What does that mean?
Let’s look at what marketing means. In a classic sense, it’s the “four p’s” of product, pricing, placement and promotion. Let’s take each one in turn.
Product
Even a horizontal product can be given some vertical content. At Sybase we had an also-ran application server (Sybase EA Server) which had little or no chance against WebLogic, WebSphere and other app servers. In 1998 we decided to add some vertical content in the form of financial messaging – FIX, SWIFT, OFX, etc. Voila! We now had something to sell to our customers in the financial vertical. There is not a doubt in anybody’s mind who was involved with Sybase Financial Server that we had a big impact on moving the horizontal application server with this strategy.
There’s also the third-party add-ons to your product if you can find them. Sybase made a lot of money being resold inside of trading and risk management systems on Wall Street. These were database licenses that they would not have gotten otherwise.
Pricing
This one is harder. It’s not easy to charge different groups of customers different prices for the same product. In some markets it may even be illegal. Skip pricing…
Placement
For enterprise tech, this means channel. You can impact placement by recruiting vertically embedded channel partners – integrators with a focus on a key vertical such as healthcare or government. Service partners with vertical specialties are incredibly valuable in penetrating markets.
Promotion
This is really the content and promotion section.
Most horizontal technology products and services vendors have some content on their site about their markets or “industries” they specialize in. Most of it is crap. It’s a throwaway that RBS uses your security solution, or that Verizon embeds your linux in their switches. That they bought from you is no big deal. What’s often missing is anything about your specific differentiation related to a customer’s market.
For example, if your columnwise database format makes realtime risk calculations 10x faster, driving more profitable algorithmic trading – that’s relevant!! Or if your security products have been certified for standards specific to the target industry – fantastic!
The promotion side – programs such as PR, advertising, events, direct, web/emarketing, etc. – can be a big area of verticalization. While your competitors spend money fighting their way into the same 5 CRM publications, you could be getting coverage in American Banker, or Securities Information News. Instead of buying a booth at “Enterprise 2.0″ and other lame-o horizontal tech chose (ugh – LinuxWorld!), how about sponsoring a Wall Street CIO breakfast or showing up at the SIFMA conferences. Be careful though! Don’t bring your horizontal game to a vertical playing field. You need to target your message in your programs too.
Being more effective at vertical marketing is more work than most people understand – and the results are predictable for those who do this halfway. However, if you take a wholistic approach to vertical markets and do it right, perhaps you’ll establsh a leadership position in a key segment that helps you weather the downturn.
We all know that this economy really stinks (sorry John McCain, but the fundamentals are not strong). As expected, layoffs are accelerating, with Sun, Fidelity, Citi and thousands of other companies shrinking their staffs. In a booming economy, the people getting let go are often the ones with less value to add. Marginal performers, no matter how people try to spin it, are the first to go in any group. Watch the next 10 days — a lot of layoffs are going to happen before Thanksgiving. Then watch the first 2 weeks of December as more companies take headcount off the books.
When the economy falls off a cliff the cuts go deeper. Goldman Sachs is projecting unemployment at 8.5% by the end of next year – and that number under-reports the real level of unemployment because a lot of people stop looking for work and don’t get counted.
Now you’re into muscle and bone – and even great talent starts finding themselves out of work. Further, there are fewer great jobs for them to transition into. Sure, really great people can almost always find a job. But it might not be the kind of interesting, game-changing work that they had been doing previously. Think about it — a whole lot more people will lose their jobs this year, and more still again in 2009. So many of them will get frustrated in their searches and be looking for anything to keep them in the game.
This is when the creative ones start companies, or join others who are getting a new idea going. If you can live without steady income for a few quarters while you build out your new thing – perhaps contracting (good luck finding projects) and doing the start-up in the evenings and on weekends – you might find that you both enjoy it more and potentially have a big payoff when the market recovers.
If you happen to be in a company that’s still growing and looking for people – raise your standards. You no longer have to settle for someone else’s second best. This is the time to build truly great teams. In some cases you can even use the talent displacement to “upgrade” your team by letting go of the bottom tier of your company and hiring in the great ones looking for work. It may sound harsh, but if you’re running a business, division or department, you have an obligation to make your team as strong as possible. It’s getting a lot easier to make that change now and the window won’t last forever.
So, what can you do? Get behind the wheel and drive if you have the the personality. But fasten your seatbelts – it’s going to be a bumpy ride.
Last night I went to a reunion celebrating the 20th anniversary of the founding of Object Design, Inc. (now part of Progress Software). I joined ODI as an intern in 1991 while at Babson because a friend at The Weber Group (Larry Weber's PR firm from the 90's) told me I should take a job there scrubbing the toilets if I had to because it was such an amazing company. I only had to work in the mail room, (no, I'm not joking – I literally stuffed and mailed out collateral) but I got my high-tech start there and left in 1996 after product managing the launch of the ObjectStore ODBMS for Windows.
ODI, as we called it, was a rare company. The intellectual talent across the company was as good as you'll ever find (and I've yet to find since). Any one of the engineers at ODI would be the "guru" at 99.9% of other software companies out there. The stuff they did was just mind-numbingly great.
More importantly, the culture there was just as amazing. People would go out of their way to help each other be successful. The sales people and engineers and marketers all worked together to build a great business. While the management team was part of that, the culture at ODI was more from the bottom up than top down. You saw it in the hallways, when people went into their colleagues' offices (we all had offices – very few were in cubes and often just temporarily), and in the lunch room. Nobody was disrespected, and very few honest disagreements turned acrimonious.
The culture stayed that way until just after ODI was named as #1 on the INC 500 list of fastest growing private companies. Oracle offered $100M or so to buy the company, but the management team turned it down (I was not on the mgt team). We were going to crush Oracle, certainly! Oh, the arrogance. You know what happened next… we started missing our quarterly numbers. Eventually the investors took over and kicked out the old management team, cut salaries and let go a good portion of the company. The culture was gone then, but not forgotten.
Looking around last night I saw many familiar faces. Sure, we all looked a bit older, but most were still looking great after all this time. Funny how all of our stories to each other last night were about all the good times… the big early deals, the technical breakthroughs, the demos at OOPSLA, etc. A lot of people came out last night – more than I expected. One of the ODI Germany sales guys even tried to find a flight in but couldn't afford the 1,000 Euro airfare from Frankfurt.
The number one refrain I heard last night was how nobody had landed somewhere that special again in their careers. Someday I hope to be in a situation where I'm surrounded by so many awesomely talented and truly great individuals.
I guess there are two such times. Immediately after 9/11 when the country rallied, the stock market reopened, and the world realized that even attacks as big and disastrous as those perpetrated on that day would not, in the end, damage the idea that is the United States. A few years later that feeling had been replaced by bewildering shame and fear of what we had become under George W. Bush.
The time before that was in the mid-1980s. I was living in NYC less than a year out of college. The "Reagan Revolution" was well underway and America was emerging from the 14-year cave that characterized the post-Vietnam War, post-Watergate era. We were finally starting to feel good about being Americans. Say what you will about Reagan, but he did give us this.
One memory of that time stands out above all others for me. I was out with some friends at a microbrew pub called the Manhattan Brewing Company (if I recall correctly). This was a great loft-style place somewhere in or near the Village, with picnic benches and huge bowls of peanuts in the shell. It smelled of beer (naturally) and the crunch of peanut shells as people walked through the room was pretty loud.
In any event, at one point someone stood up and started singing God Bless America, loudly enough that most in this cavernous room could hear him above the hubbub of 500 half-drunk "conversationalists." By the middle of "Land, that I love…" most everybody in the room was standing. And singing – or screaming – the rest of that wonderful song. By the end of the second "home, sweet, home" most people – men and women – were crying openly. The feeling was sort of a religious rapture. Right then and there over 500 people resolved to relegate the self-hate of the 70's and early 80's to the dustbin of history.
That was how I felt at 11PM EDT last night. I, along with countless millions across this great country and around the globe, remembered how it feels to be proud of America and to be inspired to be a better person. Last night brought back the memory of that night in 1985 in NY, and relegated it to a footnote. More than 200 years after the framers of our Constitution settled on a compromise that protected the rights of Southern landowners to own slaves in order to form a single country, we have finally moved to a world where "all men are [truly] created equal" and Americans have shown that they will value the quality of a person's character above the color of their skin.
Change, indeed!
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