Category / Business Strategy

by jcuene

Innovation Framework From Doblin

It seems like there are just as many ways to talk and think about innovation as there are reasons to innovate. To get the conversations started with clients, i’ve always liked to use a framework to jumpstart the thinking.

I’ve mostly relied on simple 2×2’s or some variant of the incremental/disruptive comparison. Mainly because they’re simple to understand and most leaders can immediately apply the framework to their situation.

But, after reading a bunch of thinking from Doblin Group, i’ve come to really like their framework. It takes some work to fully understand all the dimensions, but that depth makes it versatile and forces the conversation beyond the obvious topics. Especially for folks like me who are deep in “digital”, a framework like this gets the conversation away from the basic stuff – technology, digital advertising, content – and should force a conversation about more potentially transformative options: business models, partnerships, etc.

 

by jcuene

CEO’s & CMO’s: 2017 Strategic Planning Questions for Your Digital Team

While the rest of us are enjoying the fall weather, football and the changing seasons, most CMO’s and CEO’s and their leadership teams are elbow deep in 2017 planning and budgeting. In addition to all the normal business challenges, most leadership teams are probably spending a significant amount of time talking – one away or another – about digital and/or their digital transformation. Maybe its a question of how to allocate the capital budget for digital capabilities, or it could be a culture question (“How do we get more digital talent?”). Or, more urgently, it could be an existential question (“how do we compete against X and the disruption they are causing”).

Eventually, those boardroom conversations and plans will make their way down to strategic planning discussions with the VP’s of Digital Marketing, the Chief Digital Officer, Head of Digital, or Directors of Digital. Here’s what we hope those lucky leaders are getting asked in those strategic conversations:

  • What’s our strategy to use data to develop a competitive advantage? We see a lot of C-level leaders who are missing the strategic opportunity to plan for, collect and analyze data in unique ways (not just the obvious stuff) to give themselves a competitive advantage. We know of one company that bought a couple large Instagram handles from their owners, just so they could get the day to day data on likes and use the comments section to gain unique consumer insights that their competitors wouldn’t have
  • How are we using digital to create a unified experience over the whole  customer journey? Smart companies are moving on from digitizing their functions (Sales, Service, PR, brand Management)  to looking for ways to integrate and unify the whole consumer experience. They are going from good/great execution at the functional level to managing the whole customer journey in a holistic, integrated way even though there’s not an immediate ROI and dramatic changes in short term results are rare. Not only is it better for consumers, it positions companies to collect unique, potentially proprietary data along the way. It’s an easy concept to grasp, but it’s incredibly hard to execute internally unless there is a multi-year commitment from the top to keep investing ahead of results.
  • What capital investments and resource allocations do we need to make to get better data across the customer journey? See above. A dramatically improved customer experience will generate incredibly valuable data
  • What must we do to invest enough in both incremental and transformation innovation? No good leader says “no” to opportunities to invest in innovation, but few leadership teams are disciplined enough to balance short-term, functional innovation (i.e. incremental) with the willingness to pursue transformational opportunities.or instance, we know of one company that is generating a surprising amount of revenue from advertising on their digital platform; enough revenue to pay for a larger, more advanced digital team. It’s almost guaranteed that the directors and managers and coordinators on the digital team have ideas for both, but they may not be getting the support to pursue both due to a heavy prioritization of short term results.
  • How do we need to evolve our brand position and actions to be even more relevant to our customers? All leaders should by now understand how digital is transforming consumer expectations of brands. But even after years of watching brands like Dove drive great results by moving the brand to a higher, more aspirational space (and creating amazing digital content that’s getting shared all over the place), too many leaders are still(!) focused on the result (“get me something that goes viral”) instead of the characteristics of a soap brand that millions and millions want to connect with. In other words, you have to do the work to elevate your brand and your company in order to be relatable, digitally.
  • What do we need to do culturally to create the conditions for more agility and innovation in our marketing? Most good business leaders have read up on Agile, Lean Startup, and “working like a startup”. It’s thrilling to see courageous leaders try to change their companies actions. But, smart C-level folks will listen to the digital teams about what needs to change culturally to create the conditions for more flexibility, agility and innovation in their marketing model (or their business, overall). The behaviors are one thing, but the attitudes and beliefs and values and incentives are another. Most importantly, CMO’s and CEO’s should be asking: Have I created the right incentives to unlock true innovation (or  will my team still get penalized for taking risks)?
  • Are we being aggressive in looking at business model or product innovation opportunities? This is something that any sufficiently paranoid organization should be asking itself every six months: “what would a potential disruptor do to come take our business away?” Or, put another way, “how do we not get Blockbustered?” And, as part of the same exercise, CEO’s should be asking their digital team “what opportunities are we missing to use digital for  new revenue, new products, or serving our customers more effectively”? It’s easy to get a false sense of security that “we’re on it!”.
  • What do we need to do to help our employees work at the pace and speed of our customers? As the proliferation of tools and technology accelerates, it’s imperative for customer-focused companies to enable their front line people – the sales folks, the community managers, customer service – to work with the same tools and platforms that their customers are using. So, whether it’s instagram or Snapchat messaging, chatbots or Kik, CMO/CEO’s will make the hard policy changes to stay connected with their consumers

If you’re the VP or Sr Director of Digital, the Head of Digital or the Digital Transformation leader and these questions aren’t coming up in the annual operating plan discussions, you should set up time with your CMO and CEO and push these issues forward. It’s your chance to lead “up” and push the thinking of your organization and, ultimately, position your team to drive even greater impact in the organization. And, to make life a little better for your customers in 2017.

by jcuene

BitTorrent wants to change the way the web is built | The Verge

In this vision, web publishers could publish, distribute, and update an entire website through the BitTorrent protocol, and others visiting the page would automatically help share the site’s content, just as anyone downloading a file over BitTorrent would also start sharing the file with other peers.

via BitTorrent wants to change the way the web is built | The Verge.

by jcuene

From “Labs” to “Core”: Transitioning from Digital Experiment to Core Business

It’s pretty clear by now that smart CMO’s are seeking ways to accelerate growth by looking at digital products and platforms to energize their product mix and boost their marketing. As they ask their team to explore faster, both CMO’s and CTO’s need to be ready for the bumps ahead as the innovations go from “experiments” to “core business”.

Often, the leaders who are being asked to lead innovation are explicitly tasked with finding new ways to work in addition to defining new product/service offerings. They might be leading Innovation, New Products, New Ventures or Business Development. So, they are expected to explore new tools, new technology, new partners or new methods for working with a goal of injecting innovation into the organization while defining new revenue streams.

But, while there is a growing set of best practices on how to invent and launch new products inside the enterprise, there aren’t as many best practices for the transition period when those products go from “innovation” into “run the core business”. Worse, few innovation leaders have a clear plan for enlisting the support of the functional leaders (IT, Product management, sales, etc.) who have to maintain and manage an innovative product once it’s launched and proven.

As a result, one of the biggest threats to capturing the benefit from innovation activities is the slow death that comes when the original strategic intent is second guessed, re-thought, and challenged by the core business.

For example, imagine a scenario where the VP of Innovation for Enormicon Inc saw a legitimate market opportunity for a new product with a different business model. Over the course of a year, his “Enormicom Labs” team moved quickly, working like an agile startup to create the first iteration of the product including customer growth, market traction, press awareness and lots of insights into how the product could succeed. But, to scale the product, Enormicon would have to move the product from the “Labs” team into the core business.

As the product moves from the “Labs” team to the mainline business, the strategic intent of the innovation project will probably clash with the functional strategies that support the business. The tech choices that were made to enable speed and quality in the “innovation” phase will probably run counter to tech strategies that guide the main business (i.e. repeatability, cost reduction, leverage core technologies, scale efficiencies). The marketing approach used to quickly gain new customers for the innovative product will probably not be supportable by the “core” marketing team’s strategies.

To successfully grow businesses via innovation, Enormicon will need support in launching innovative products, but also in re-integrating those products into the business once the new product is proven.

Innovation leaders will need strong support as they think through the start up process AND the phase of introducing their new products and services into the main business. Change leaders will need to develop stronger support for:

  • Tech Strategy – Choosing tech (the software, the programming language, the development methodology, the support model) that will work for both the start up phase (agile, fast, easy and cheap to build and support) and the re-entry phase (software that’s scaleable, supportable by the corporation, bullet-proof and fits into the rest of the company’s architecture)
  • Maintaining Strategic Support – Building the strategic rationale and the  business case for doing things differently, so functional leaders will invest the extra effort and time and money to support the experimental efforts (tech, marketing, etc.
by jcuene

Transformation is Everyone’s Job, not Just the CMO: “Will 2015 Be The Year Of Digital Transformation?”

CMO magazine predicts 2015 will be the year of “digital” transformation for most orgs. They asked a bunch of CMO/Marketing leaders to offer some predictions for the year.

These days digital transformation is top-of-mind for CMOs, and it reaches all corners of marketing. That includes devising new strategies to meet the expectations of omnichannel customers, capitalizing on what new technologies now enable (geotargeting, personalization, and automation, to name just a few), and changing the makeup of the modern-day marketing team to ensure the right skill set.

If you’re a CMO and you’re just getting to this, it might already be too late.

The real challenge to a “digital transformation” is that the CMO will only be a cheerleader (worst case) or one key leader in the executive suite (best case). The real transformation has to happen in organizations the CMO doesn’t always control.

Business Units – Short and long term incentives, promotional criteria and budget allocation all need to change. For example, digital transformation requires a ton of experimentation. Experimentation equals risk. Most good marketers have incentives that do not align with risk and change. Transformation requires, by definition, change.

IT – Systems, tools, incentives and budgeting will have to be changed. For instance, most capital budgeting requires some sort of ROI estimate. Most of the “digital transformation” investments will have, at best, a hazy ROI horizin. Yet, the investments need to be made to enable the transformation.

HR – The way organizations hire, develop, train and evaluate teams will have to change and the CMO rarely has direct influence over the group. For example, organizations will need to promote teams that have a high confidence in ambiguity, can lead through change, are resilient. Most importantly, business functions will need to reward true creativity.

I love the discussion of driving transformation. There’s a ton that’s needed. But, it’s not just the CMO’s job. It’s everybody’s job.

by jcuene

(Updated) Um, Facebook, This isn’t Great

Engagement with brand content is evidently dropping  pretty dramatically. As a guy that went all in on Facebook when i was in a seat to influence a lot of media spend, this is concerning. For brands, it’s obviously bad. For consumers, it’s probably a win of sorts.

These numbers are even more striking when you consider engagement is significantly down even though brands are almost certainly spending more money to promote their posts to combat plummeting organic reach. Facebook’s ad revenue reached $2.27 billion in Q1 2014, up 82 percent from Q1 2013.For brands on Facebook, these are dark days. They can choose to spend more money to reach fans they had already accumulated in the past, but Facebook will likely decrease branded reach even further.

But, this also speaks to challenges in the FB ad model from the brand perspective. It seems like Facebook is  resorting to limiting organic impression supply (by tweaking the algorythm to lessen brand reach), making it more important for brands to pay to get the exposure.  The main reason i believed Facebook was a great platform was the  combination of organic and efficient paid reach. With the constant tweaks to the organic reach black box, that mix (of organic and paid) gets less attractive and FB becomes just another paid ad platform.

UPDATE 6/18/14: I think i buried the lede here. The point i was REALLY trying to make is that it looks like Facebook is losing one of the aspects that made it so attractive in the first place: It enable brands to build deeper relationships (that’s good) while also building a more modern media mix, one that delivered a beneficial combination of owned and earned media and paid. The less organic reach a brand can generate, the more they have to pay to get the reach, the less attractive the original value proposition is.

via New Report Reveals Just How Drastically Brand Engagement is Plummeting on Facebook | The Content Strategist, by Contently.

by jcuene

The BlockChain is the Beauty Inside Bitcoin

I need to come back and write up a clear article on this, but i’ve been digging deep into Bitcoin. Not the cryptocurrency part, but the actual protocol behind it. The think i’m curious about: What else could we apply the blockchain concept to. That is, what kind of decentralization can happen when there is a secure, transparent, open, scriptable, public ledger holding the system together.

Lots more to think about,  but here’s a couple important articles for my own future reference:

 

by jcuene

Lessons For Marketers in the NYT’s Leaked Innovation Report

The New York Times 2014 Innovation Report is an extraordinary document. Extraordinary in that it  exists at all, for one thing. But, also extraordinary for the honesty and candor in the analysis provided by the authors.

We’ve all watched the news business getting transformed over the years by blogs, the web, Google, etc. Now we can read the report from inside a pre-eminent news organization, written by a handpicked group of leaders given the mandate to tell the truth to power (well, their bosses).

But, at the same time, it’s an exceptionally useful document for marketing leaders who are struggling to thrive in a time of rapid, seismic changes. Digital, however you want to define it, is creating almost unlimited opportunities to create new growth, reach new audiences, and work in different ways. Call it creative destruction, transformational innovation, or just reinvention; we’re all going to have to deal with it. The news business is at the front of many of these changes, but eventually all business, from cars to cereal will have to deal with them. So, we can learn a lot about what to do (and what NOT to do) by reading this report carefully.

While it was unfortunate that this document was leaked, we nonetheless have it as a story of a great organization at the mid-point of a life-or-death struggle. Here are just a few lessons  brand builders can take away.

Be Honest With Yourself, First – One of the more remarkable things about this document is that it doesn’t seem to hold many punches. It calls out specific projects, departments, etc. Its a seemingly honest assessment of what’s working and not working. Not self-flagellating, but also not overly optimistic about what’s really going on. Marketing leaders should take on this kind of assessment every other year, at least. A hard look, done by trusted mid-level leaders, those with enough understanding of how things really work on the execution level but also have a broader strategic sense about what the organization can be and needs to get there.

Understanding how Disruption Works is the First Step to Disrupting Yourself – With everyone talking about innovation all the time, you’d assume everyone understands what “Innovation” really is. But, wisely, the writers spend a couple pages outlining Clay Christensen’s Disruptive Innovation process. And, they even provide a cheat sheet for their new competitors. As leaders, we should understand that disruptive innovation actually is kind of predictable and it will hit every industry at some point. Get your teams to understand this, and it’s the first step to creating the kind of innovations that disrupt the business on your terms vs. waiting for someone else to do it to you.

Reconsider What You’ve Always Taken For Granted – The report advocates a recommitment to audience development strategy, to re-examine how they are getting the news in front of people.  For generations, the Times could assume an audience existed, was reachable in a predictable way, and cared about the product. But, that audience is easily swayed, distractible, and, in the end, not so easy to reach. Now, the Times has to re-learn how to reach it’s audience, weaving a news set of skill into the newsroom. All leaders should be rethinking the parts of the model they’ve always taken for granted.

Digital First is Much More than a Buzzphrase – For the times, it’s a flip from “a newspaper that also produces a rich and impressive digital product” to “A digital publication that also produces a rich and impressive newspaper”. That’s over-simplified, but that mental model flip is one that most marketing organizations need to make if they haven’t already made. A mobile, digital way of building the brand that is amplified at scale by traditional media is  “digital first” for most marketers.

Culture Change is a Mofo – This is really a document describing wrenching culture change in slow motion. The capabilities, the technology, the tools will all be relatively easy to update. But, the talent, the leadership, the skills, the mindset needed to thrive in a digital-first world at the Times will be incredibly difficult to weave into the organization. The leaders will have to remake their culture from the inside without losing the best of what got them there.

Finally, the real story here is that the leaders of this organization recognized they were out of synch with their times and they turned to 8 trusted insiders to figure it out. That’s courage. We can all learn from them.

There are dozens and dozens of smaller nuggets in the document. It’s so rare for a business leader to get a peek into another organizations’ strategy development process that i imagine this will be a document i go back to and re-read multiple times.

Here are a couple other great writeups:

by jcuene

Managing Startups: Best Blog Posts of 2013 | Platforms and Networks

Managing Startups: Best Blog Posts of 2013 | Platforms and Networks.

This is about everything you need toread for the next couple weeks. Tremendous resource for anyone thinking about working in a “lean”, “agile”, “fast”, “iterative” or whatever mode.

Meta comment: Eisenmann’s blog is a great, living reminder of the power of blogs. With all the focus on shorter, faster, more ephemeral media (i’m looking at you Snapchat, instagram, Twitter), it’s very worthwhile to reflect on the core idea behind blogs, blogging, great posts and the whole concept of publishing for an audience.

 

by jcuene

Why Didn’t Honeywell Invent Nest? The Value of Purpose

Evidently, Nest is worth a couple billion dollars in the minds of investors. That company didn’t really exist a couple years ago, but investors see the potential and Nest is a good example of how a purpose-lead company can spark new growth by reimagining old businesses.

But there are higher risks, of course, with hardware-focused products like Nest, compared to software-only investments, due to the more costly ramp up for such products. But said one investor, “This is a company that could change how we live our everyday lives,” noting the tight integration with mobile phones was a key step in the evolution of such devices.

via Nest Raising Huge New Round From DST, Valuing Smart Home Startup at Upwards of $2 Billion | Re/code.

Why didn’t Honeywell invent Nest? There is no doubt the halls of Honeywell are filled with incredible technologists. They have installs in god knows how many homes in the US and around the globe. Is it because their business model is so heavily focused on resellers and contractors? Is it because they forgot what business they are really in (e.g. “we’re in the comfort business” vs. “we’re in the thermostat and electronics business”). Is it because the actual product would have cannibalized the rest of the line? Perhaps the actual Nest product wouldn’t have been a big enough opportunity for a 72Billion dollar company. Finally, perhaps the leaders at Honeywell have a really healthy and profitable thermostat business already in place and didn’t see a chance for a significant change in their growth curve from real innovation from their core products.

Here’s a clue,  from Nests “about us” page that reveals how purpose guides their approach: 

About_us___Nest

Simple. Beautiful. Thoughtful. They’re focused on “unloved” things. They know no one loves their thermostat.  But, their purpose is to make things you’ll reconsider and then fall in love with. It’s a design approach and a laser focus on the consumer mindset. They are an end user oriented company that has empathy as their core lens. Tech, coding, sales, marketing and everything else come afterwards. Rethinking old problems to help consumers is core to their culture.

Now, check out Honeywell’s “About us” page (actually, there are a number of Honeywell “About us” pages. This one is for their consumer products):

About_Us_-_yourhome.honeywell.com

While it’s great that they are customer focused, it’s pretty clear that their customers are NOT consumers. They’re focused on resellers, builders, etc. They are designing products they know their real customers will buy, not products consumers are going to fall in love with.

Business school students will be reading case studies about Nest for years to come. It’s going to be interesting watching Honeywell’s response. Not only do they have a product challenge, but they are going to have a business culture problem, as well. They can compete on technology, but will they be able to get over the internal cultural barriers that will make it difficult to truly put the consumer needs first? Will they be able to reconnect with their core purpose as a way to re-orient their product and marketing efforts?