Pretzel Logic – Enterprise 2.0

My good friend (and fellow competitive swimmer, back in the day), Dina Mehta, wrote an insightful post based on her research work around the topic of product durability. Though she refers to her findings based on the Indian market and the changing nature of durability, locally, there’s no question that this is a global phenomena.

The central theme of the research is that consumers value product durability less and less as time goes on. It used to be that when we bought products and services, life of the product was an important consideration and products were advertised as such. In Dina’s post, Stuart Henshall provides the most well known example:

When I think durability I think of Maytag – the washing machines that go forever here. Yet today that “durable” isn’t expected to last 20 years and new features, energy efficiency etc are changing the definition

Dina provides some great local examples of how consumers look at durability today. Based on her research, she concludes:

Thinking thru current Ads on tv – only the infrastructure and paints guys seem to talk about Durability in their communication today.

As Dina points out, its obviously not the case that customers don’t want products that last; it’s just that the markets in India finally afford choice. When I grew up there, you could only by one of 2 types of cars, a handful of electronic or appliance brands or for that matter, chocolate (yes, a travesty). All that’s changed now. And with choice comes the desire and willingness to swap for newer, shiny models at a more frequent pace.

There’s plenty of parallels to be drawn in the rest of the world where choice has been standard for decades. However, the marketing approach to this was to turn up the volume when it comes to badgering the customer with more marketing emails. Or to throw in the towel and compete on price with promotions that were often loss leaders or just a way to empty out the warehouse.

Durable Relationships

The truth is that in this age of transparent and open marketing which is moving to influencer and peer to peer modes, one sustainable approach to respond to this consumer trend is to focus on building durable relationships with customers. Existing customer relationship programs and enabling technologies (CRM) often enforce a fenced-in transactive model where its about that individual sale. That needs to move to a relationship model that can outlast that single transaction. And with the proper strategic planning, create an interaction environment that results in durability. Choice is here to stay. All you can do it make the customer comfortable with the notion that your first in line when they are looking to exercise choice. And one way to do that is to preemptively help them understand exactly why and when you should be in consideration. Thats done through effective customer Networks.

From a programmatic stand point, the answer is not jut Social Media or some other over intellectual way of looking at public or consumer relationships. Social Media is part of the larger tapestry. The answer lies in reworking the process of building and sustaining relationships with customers via social and collaborative forms of engagement. That comes from revisiting the mode of engagement that extends far beyond the nominated “social media leads” but permeates the walls that today, omit interaction with traditional sales, marketing, internal and partner experts who truly have the most substantive knowledge. Anything less will come of as plastic.

In turn, from an enabling technology standpoint, that means rethinking how your Social Media, CRM and so called ‘SocialCRM" and ‘Enterprise 2.0‘ efforts come together to build and foster genuine, durable relationships.

I highly recommend you read Dina’s original and follow up post on the implications of durability taking a back seat in the context of purchasing behavior. She’s got a very passionate community of intelligent folks that have provided comment.

As some of you heard (many thanks for the notes), I’ve joined the Defrag Conference Advisory Board.

For those of you who are not familiar with the conference, Defrag is a yearly event in Denver that’s focused on emerging tools and trends in technology and its’ impact on business.

The conference is organized by Phil Becker, Brad Feld and Eric Norlin and counts Roger Ehrenberg, Paul Kedrosky, Jerry Michalski and Chris Shipley as advisors.

Here’s how I described the conference in a recent post:

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The Five Fragments That Make Up Defrag:

I’m going to spare you a diatribe on why its a great event and distill it down to five reasons, (or fragments) that make me go back and why this an awesome event for the enterprise folks out there:

• Its about debating solutions to big big business and economic value challenges that will consume us all over the next 12-24 months. That applies to the buy-side as well as the sell side.
• Its about the ramifications of eventual large scale adoption of a lot of what a serious IT executive will deem to be well, “cutesy” ideas today (e.g. Real Time Enterprise).
• A cut to the chase discussion on which consumer trends we see and use today might one day be enterprise worthy. Remember when people laughed at the concept of ‘Facebook for the Enterprise’? Yep, that probably came up at Defrag two events ago.
• Little talk-to-the-crowd panels. Everyone is deemed to be intelligent and has an equal voice. You’ll spend more time talking to the person sitting next to you than you will listening to someone on stage. Guaranteed.
• Its frightfully practical stuff. No fluff. All actionable thinking that makes you look at work differently when you leave. And makes you want to come right back the next year.

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A little about the conference in the words of Eric Norlin, the organizer:

Defrag is the first conference focused solely on the tools and technologies that are leveraging the "social" aspect of software to accelerate the "aha" moment. Defrag is not a version number. Rather it’s a gathering place for the growing community of implementers, users, builders and thinkers that are working on the next wave of software innovation.

Thanks to Eric for reaching out. Looking forward to a great event!

P.S If you’re a fan of Sons of Anarchy on FX, you’ll get what that T-Shirt is all about -)

“If I’d asked my customers what they wanted, they’d have said a faster horse."  – Henry Ford.

Somewhere there’s got to be a similar line from Steve Jobs as well.  And both have successfully belted out product after product that changed the automotive, mobile and media business, forever. All without involving the customer in a meaningful way.

So why are customer and employee led innovation programs all the rage at organizations today? Idea Management Platforms such as Bright Idea, Spigit and others are selling like hotcakes. And  Enterprise 2.0 platforms such as Jive Software and Newsgator single out this one purpose driven component and offer it as well.

Chevrons doing it, SAP’s doing it, Intuit’s doing it and lots and lots of others. And they are all involving customers, partners and employees to help them find and refine the next big idea or ways to streamline operations within organizations as a way to reduce cost and mitigate risk. And they’re saving or making millions doing so.

Come find out what the hoopla is all about at the Innovation Meetup in Mountain View this Tuesday, the 23rd of March at 6:30 pm. I’m moderating an awesome panel with Susie Wee, CTO of Client Cloud Services at HP, Tad Milbourn of Intuit and Marco ten Vaanholt, VP of SAP’s Community Network.

At Sovos, were also working on some high profile innovation programs with clients right now so it should be a lively discussion. We’re going to discuss the drivers, challenges and as important execution and follow through of successful innovation programs. Collecting ideas is one thing. Doing something about it is another. We’ll find out how the experts do it.

The event is hosted by Tatyana Kanzavelli whose now legendary in Silicon Valley for producing intimate, high quality events.

More about the event from the Meet Up website:

Innovation has been dubbed as one of the more promising purpose-driven applications of social and collaborative technology in the enterprises. Whether as a way to encourage customers or internal employees, Innovation Programs in enterprises have unlocked critical ideas at well known enterprises that has ultimately led to the conception of new product ideas, significant cost savings internally and finally, operational efficiency. Sameer Patel, founding partner at the Sovos Group will moderate a session to highlight the opportunity and challenges that organizations face as they seek to unlock critical insight coming from customers, partners and employees.

Learn more about the panelists and the event and register on the Meet Up site here. It’s $20 online and $30 at the door. Food and wine included.

Hope to see you there.

This morning my favorite business journal, the Economist, has a good article on how the recession has had an impact on productivity and the differences in fall out in the United States vs. the European Union.

First an extremely interesting and arguably polarizing difference in how productivity is defined. The economist says:

Producing more by working less is the key to rising living standards, but in the short term there is a tension between efficiency and jobs.

Whether right or wrong, I don’t believe organizations at least in the United States consider this the goal. Here, its generally about get people to cram more work per hour so we can get more out of their eight hour day. Contrast that objective with them being able to go home early and have a life. But I digress.

On to the the central theme of the article:

Analysis by the Conference Board, a research firm, shows just how different the recession was on either side of the Atlantic. America’s economy shrank by around 2.5% last year but hours worked fell at twice that rate, so productivity (GDP per hour) rose by 2.5%. The average drop in GDP in the 15 countries that made up the European Union before its expansion in 2004 was larger, at 4.2%. But hours worked fell less sharply than in America and, as a result, EU productivity fell by 1.1% (see table). Workers that held on to jobs in America and Europe had their hours cut by similar amounts. The reason total hours worked fell by more in America was that there were more job losses there: employment fell by 3.6% last year, compared with a 1.9% fall in the EU.

Productivity has generally been one of the central themes when it comes to showing benefit from social and Enterprise 2.0 concepts. Often adopted from Knowledge Management. If you’ve read this blog since its inception about 15 months ago or you’re one of my clients, you’ll know that I have a fever-invoking aversion to casting productivity as goal of Enterprise 2.0 design (as opposed to an enabler). This, IMO, results in the colossal short sell of the promise of Enterprise 2.0. Its always been about performance acceleration here, where enterprise 2.0 concepts we know of today are enablers toward established performance goals.

Sticking with the productivity benefit argument since it is used a lot in the context of Enterprise 2.0, is it the case that Europe is seeing slower adoption of Enterprise 2.0 concepts because of the sheer people capacity that still exists in organizations? In other words, the need to do more with less is not as strong in Europe as compared to what’s seen in the United States? If people are the ultimate producers and you have an abundance of labor, being productive by finding experts faster, searching for data and content less, reducing time consuming meetings and email, etc etc don’t seem to be strong, budget-shifting value propositions.

What do our European management thinkers and product vendors think about this and what are you seeing on the ground?

Moving on to a stinging conclusion that should be a wake up call for us all in the Enterprise 2.0 space, whether in the United States or Europe, the Economist says:

Much of the expected slowdown reflects changes in technology, says Mr Jorgenson. The burst of strong growth in American productivity after 1995 was spurred by advances in the semiconductor industry, which led to sharp falls in the price of computing power. The technology is still improving but at a slower pace, and productivity trends will soon reflect that. The global outlook is brighter, because the benefits of IT are far from exhausted in big emerging economies, such as China and India. But that is no longer the case in America, says Robert Gordon of Northwestern University. “We’ve already picked the low-hanging fruit,” he says.

Wow. The benefits of IT are exhausted in America? I don’t buy the conclusion that we’ve wrung all the possible value out of productivity angle in the west. But being objective, if this is what the market perceives as the state of affairs with respect to productivity, those that continue to beat the productivity drum as end value better step up their game. Alternatively, lets stop playing defense, go after those fenced in processes policed by rigid ERP systems for decades and focus on how to accelerate performance by reducing cost, driving revenue and mitigating risk.

Sovos will be presenting on Accelerating Performance via Social and Enterprise 2.0 technology at a webinar hosted by Software and Information Industry Association (SIIA) this week, Thursday.

Oliver Marks and I will both be on deck engaging with the audience on how to approach social computing in the context of organizational, customer and partner performance.

Here’s an excerpt:

This session aims to demystify Enterprise 2.0 benefits and to focus on pragmatic strategy by providing real world experience on viable tactics for budgeting, definining your value proposition and measuring your desired results.
Fresh from their presentation at the Enterprise 2.0 conference, Oliver Marks & Sameer Patel of the Sovos Group aim to help you unlock the value of these rapidly maturing and increasingly important social constructs to meet your specific business needs. And we’ll address how they can significantly augment the value you get from your current technology investments with greater employee and partner performance.

If you’d like to attend, here’s a promo code that gets you a discount: PRMSOVOS. You can register here. Hope to see you there.