Innovate or else…

Under the dubious title of Companies Are Erecting In-House Social Networks Verne Kopytoff of The New York Times writes:

It’s one more instance of how consumer technology trends, like the use of tablet computers, are crossing into office life. Because of Facebook, most people are already comfortable with the idea of “following” their colleagues. But in the business world, the connections are between colleagues, not personal friends or family, and the communications are meant to be about work matters — like team projects, production flaws and other routine business issues.”

The article goes on to explain the challenges of corporate social networks.  The usual suspects are drummed up: Security, Compliance, Clients…  And of course, who wants to know about the leftover pie in the kitchen.  Again.

Unfortunately, in my view, what’s missing is the most important thing that a corporate social network brings to the table:  A way to foster, harvest, and manage innovation.

Client after client ask us about ways to do exactly that:  How do we encourage innovation? How do we promote conversation.  How do new ideas bubble-up through the rigid organizational frameworks?  Almost all have a way:  From “ideation days” to “innovation rooms” to “revolution committees” etc.  Some are more successful than others as so much depends on the culture of the organization, the management’s temperament, and the ability to channel all the new ideas that come up.  Which ones are worth it?  Which ones to discard?  Who evaluates?  How do you test?  How do you fund?  And so on.

Innovation is serious business.  As a matter of fact, it’s life-and-death business.  It has been studied exhaustively by scholars far wiser than me, and their works are required reading, especially in this environment.  Run, do not walk, to the Harvard Business Publishing offerings and stock up.  It will be some of the best investments you ever made.  That’s my first recommendation.

My second is to install and promote a corporate social network as soon as possible.  Issues of governance, security, and access will immediately be suggested as barriers to doing this. Don’t let them be.  Where there is a will, there is a way.  Now, once installed, promote your social network as the place for idea generation.  The place for uncensored, public, dialogue across all fronts.  Create threads of topics – from Human Resources to Operations to Innovation.  Stay active.  Engage with your people.  Tell them “I’ll see you on the net!”  Then harvest the “likes!” It will be one of the most crucial barometers of your people’s thinking– their contribution and how their peers think of them and their idea.  Dozens and dozens “like” Mary’s idea?  I’d pay attention!  Nobody cares about Tom’s? You’re probably safe to skip.

Innovation is not an exercise for a committee.  I like to think of innovation and the ideas behind it as a spark.  A spark that can set things ablaze! To do that it needs fuel.  People are the fuel.  Your people!  Your job is to make sure they operate in a fertile ground, with the right tools, and with your total support and commitment.

Like?

 

 

 

Dreaming of True North

I was having a conversation with a client who, like many of us, is fighting a war on two fronts.

First, he is fighting a war of business survival.  Day in, day out, he needs to figure out how to position his business for tomorrow; he must try to predict what the markets will do, what will they demand of him and his team, what the competition will do, and what new competitors may do to surprise him.

And, day in and day out he has to make sure that those inside his “castle” are fed, are safe, can continue to produce, and are ready to adapt to the next challenge.

Like everyone in a leadership role today, he is being pulled by two opposing demands:  The demand to be forward thinking, innovative, and strategic and the demand to be grounded in today’s reality, manage tight resources, be tactical and constantly execute.  Sound familiar?

You might think that the last thing in his mind is IT.  After all, his business is not in technology or interactive.  But Information Technology is at the center of his thinking.  Not a day goes by that he doesn’t challenge himself and those around him on what technology can do for his business, or how it can give him an operational edge.

I remember telling him how much I appreciated his abilities and focus on IT.  He just looked at me dumbfounded.  “What do you mean?” he asked, “Doesn’t everyone?  How can you possibly survive, much less thrive, unless you know how to navigate these shifting waters?”  I tried to explain that executives do try to navigate but they either tend to be too strategic or to operational when it comes to the integration of technology into their business.  That’s when he came up with a great line.  He said, “That’s impossible, if you really think about it.  When we’re talking about IT we’re really talking about a magnet.  No matter how much you cut it in two, you always have two poles: north and south.  You can’t just have one, but you can recognize that what you’re holding is a compass. It always points you to true north.”

The last thing I remember was feeling so lucky that we have clients like him.  Clients that push us to think strategically and clients that expect us to squeeze every drop out of their IT investments.  Clients that understand technology limits, but push against them anyway.  Clients that are not afraid to admit what they don’t know, but use it as an excuse to learn.  Clients that will accept nothing less.

Then my alarm clock went off!

The good news is that we do, in fact, have clients like the one in my dream. Only they’re not very common.  I figure we all head north eventually.  The only thing we need is a good compass.

Heavy Clouds But No Rain

I was torn about the title of this entry.  Should it be Sting’s “Heavy Clouds But No Rain” or should it be Peter Allen’s and Carole Bayer Sager’s “Everything Old Is New Again?”  I settled on the former.  But either would work, as we’ll see!

The New York Times published no less than three very well written pieces on Cloud Computing from April 14th to April 18th!  So, everyone knows that something is up in the world of cloud computing.  But is there?  What exactly is going on? The Times articles point out that traditional business models are threatened, and that companies “have concerns” about moving to the cloud, while new innovating startups jump on it immediately.

All true.  So, let’s get a grip on the cloud, shall we?

First of all, what we need to do is define what this cloud thing really is:  It currently is three things:  Infrastructure-as-a-service, Platform-as-a-service, and Software-as-a-service.

Infrastructure-as-a-service is designed to eliminate the need for you to have and maintain data centers.

Platform-as-a-service is designed to provide you with a “place” to develop and run your own applications.

Software-as-a-service is designed to provide you with access to applications that are developed and run on the vendor’s data centers.

Wait a minute! Didn’t we already have all this?  Absolutely.  We called it mainframes, and time-sharing bureaus (service bureaus).  Back in the day before internet (yes, little Timmy, there was a world before Internet) computing was centralized in large data centers.  Clients would use computing resources and pay accordingly.  Similarly, there would be service bureaus that would develop and run applications for specific industries, for example accounting or fulfillment applications.  You would rent the use of this application, send your data over, and get back your reports.  Ahh… those heady days of magnetic tape and printouts.

Hence, Everything Old Is New Again.  So, what’s the big deal?

The difference here is how we are getting back to where we started.  In the beginning, shortly after the “Let there be light” computers were slow, expensive, and difficult to maintain.  Computing had no choice but be centralized.  Then, just as the oceans settled down, the computer evolved and shrunk.  Before you knew it those silicon chips were crawling all over your desk.  Computing became cheap and easily accessible.  No need for centralized data centers and the like.  Evolution killed them.  And, just as you were feeling safe to go back in the water, the Internet connected all those chips.  Having them crawl all over the place became… bothersome.  How about we use the internet and send all the chips to the cloud and have them talk to us from there?  Great thinking!  Off with their clamshells.

Now, no one said that evolution will be easy.  For one, you have the clients that rightfully are paranoid about this clouds availability, reliability, and security.  They are right.  Vendor claims have not always been shall we say “entirely accurate.”  On one hand they’ll sell 99% uptime, and on the other there will be internal memos saying that they’ll staff to 90% uptime because its cheaper to pay the penalty than to actually deliver to the promised service level agreement.  Yeah.  I’d be concerned too!

Then you have the software vendors themselves.  The major players will license you software for a nice seven-digit-number, and then milk you for 20% annual maintenance fees.  Plus, a whole army of implementers and integrators are there to leach off this transaction.  They help you install, customize, train, etc., etc.  Do you for one moment think that these constituencies are jumping up-and-down to move you to some cloud for $19.95 per user?  Think again.  When they do, you can be sure that the number will be substantially larger and that the aforementioned armies will have a special place in the cloud ecosystem.

And I don’t even need to tell you how all these nice people that actually build and sell servers and data centers feel about the cloud, do I?  Good.

Where does this leave you? In the near term, and if you can accept the associated risk, compromises, and vendor growing pains, then move as many non-mission-critical applications to the cloud as possible.  It will save you money and reduce your headache.   In the longer term, start planning for a wholesale migration to the appropriate combination of services for your business.  You still have to accept compromises, but those may be good for you.  Especially if they start saving you those seven digits we talked about earlier.

Now, that’s rain!

 

T.A.N.S.T.A.A.F.L!

That and “grok” are two of Robert A. Heinlein’s many contributions into the modern lexicon. The first, an acronym for “There Ain’t No Such Thing As A Free Lunch.” The second, grok, means to understand something completely, entirely.

Which brings us to a question:

What do the media industry and (some) consumers not grok about TANSTAAFL?

And another:

Why even bother resurrecting this old and beaten down theme?

Because, just like in any bad horror movie, this monster just won’t die. It’s been a couple of weeks when (finally) the much anticipated pay wall for The New York Times was officially announced in all its glory and detail.

Again, help me understand here… Which part of TANSTAAFL is so hard to grok? I believe that The Times hasn’t raised the pay wall as high as their journalistic bar is. I may betray my age, but it seems to me that the model that has worked for time immemorial still should apply: Walk up to any newsstand, and the experience unfolds: You see the newspaper stacked in its place. You read the headlines (free). You are fascinated/intrigued by the headlines (the high journalistic bar part). You pick the paper up, reach into your pocket, and pay the person behind the counter. That would be the pay part. If you try to abscond without paying, then the nice policeman at the corner would like to have a word or two with you.

Very simple to grok, really. Does it have value? Then it is not free.

Now, how hard was that? And, doesn’t it amaze you in its simplicity and beauty? Works for all sorts of “media.” Same with magazines. Same with books. What on earth makes anyone think that once this content is digital somehow all this goes out the window?

I refuse to go down the “on-line is different” rabbit hole, or “the genie is out of the bottle” argument. There is NO GENIE! There is intellectual property of value. Your choice is to consume it, or not. Your choice is to sponsor it, or not.

And that’s the proverbial pink elephant in the room. This is the fear that’s gripping everyone in Media. That their content is just not good enough, and thank God for those foolish advertisers that keep paying! We’ll just keep delivering traffic (any which way) and problem solved! Seriously? You really, really, think that advertisers are that stupid? Or that the consumers are dumb enough not to be able to distinguish between aggregated junk, crowdsourced “opinions” and high quality content?

The reverse is true. Advertisers are some of the brightest most quantitative minds in the business. For advertisers this has been equivalent to hitting the motherload! Metrics, metrics, metrics! Hardly there before, now they are drowning in them. Already they can tell where the highest return on their investment is down to the penny, and let me assure you, it’s not Bob’s blog straight from his bathroom. Today, advertisers have great choices. And they are exercising them, along with their audience. Choices, choices, choices…

But here is the only choice that no one has: To demand top tier, highest quality content, for free.

Even a 12-year-old groks that!

“Why can’t I get e-mail when e-mail is down?”

IT called the users that the email server was down. What came next was the question above from the CEO of the company to his CIO. Nope. I am not making it up. No emphasis added. Real question. Real CEO.

What’s sad about this is that this executive is not alone. Testimonials of this sort abound. Ask any IT professional, and she’ll give you more examples than are fit to print. And, just as I pointed out in my previous entry “It’s the Technology, Stupid” integrating technology thinking into the daily life of today’s c-suite is not just nice-to-have. It’s a must have. Managing IT will make the difference between prosperous and successful companies, and those that will be made into case studies of “what-could-we-have-done-better?” and “where-did-all-the-money-go?”

Which begs a few practical questions: For instance, exactly how much IT knowledge does a C-level executive need? How much IT expertise is necessary? What constitutes minimum core competency in IT? And, how does one go about mastering this essential skill? Especially since the world of IT is in constant flux.

I like to use the car as an example. I find surprising parallels between the car and IT. For example, they are both inconspicuous in our everyday life. At this point we can’t imagine a world without them. Both are essential. Both take you to your destination. And if you are not careful with either, you can get into very serious trouble.

So, how much do you need to know about your car? I think we can all agree that you need to master a few things: How to select one, start it, stop it, navigate with it, be safe in it, put fuel in it, know when to maintain it, and effect some repairs on it. You don’t need to be a mechanic, but you do need to know how to change tires, and top off the fluids. Also, I’m sure we agree that drinking and driving are a very bad idea, too! I call this the minimum core competency needed to operate and co-exist with this tool: The car.

I propose you treat IT exactly the same way. No more. No less. You only need to master a few things. You don’t need to be a mechanic – that’s why you have a whole IT department. But, you do need to know enough to be able to decide what kind of IT you want, and what to do with it when you have it. Even effect some repairs! It’s not as hard as you think. As a matter of fact, in upcoming blog entries I’ll walk you through the essential IT skills you must have to succeed in your leadership role. And, how to never end up as road kill on the information highway!

Now, please fasten your seatbelts!

It’s the Technology, Stupid!

Just as the words of President Clinton still echo their fundamental truth in our country’s politics, I submit a new rallying cry to corporate America: “It’s the Technology, Stupid!”

Consider this: In January of this year, Hugo Sarrazin and Andy West wrote in McKinsey Quarterly an insightful paper on “Understanding the strategic value of IT in M&A.” (You can get the paper here: http://www.mckinseyquarterly.com/Understanding_the_strategic_value_of_IT_in_MA_2709 ).

In it they wisely point out that many mergers fail to live up to expectations because of poor integration planning. And the key component of that plan is IT. Unfortunately, it is even worse than that.

The M&A issues that the paper identifies mask an even deeper problem: Poor integration of IT thinking inside the C-suite, and by extension, throughout the company. You would think that this is a thing of the past, especially now with CIOs, CTOs, CDOs, and all sorts of C-x-O’s roaming around board rooms. But the reality is different.

Our work has exposed us to an ugly truth: Although many CEOs pay lip service to the importance of IT in their strategic thinking, and may even assert as proof their shinny C-level IT executive, their day to day actions betray their ignorance on most things digital. All too frequently they are seduced by a revenue muse here, an acquisition there, or be immersed into their most recent “critical” project du jour, totally ignoring both strategic and operational IT implications. Unfortunately, these implications are ignored at the CEO’s (and ultimately the company’s) peril.

This is more than a matter of IT literacy at the C-suite (That will be a topic of a whole other blog entry, Don’t get me started!) This is about integrating technology thinking directly into the company’s leadership DNA. We can no longer point the finger to the C-technologist as the one responsible for this. She is not! Time to wake up and smell the silicon!

The responsibility starts with the CEO, and flows downhill from there. He or she must accept responsibility for their own IT literacy and not be afraid to let their strategy, management, and operational skills be placed under an IT lens. They should welcome this. Invite it. When done right, the results are astonishing.

Examples abound: Think about the transformative power of mobile technologies. How well is that thinking integrated into the C-suite? How about tablets and new media? Or, the opportunities to re-shape the company through cloud computing and shared workspaces?

Do these things sound foreign and scary? Then, you have a problem! And, isn’t your strength as a leader to solve problems? For that matter, isn’t it your responsibility to solve these problems?

I’m glad we agree!

Now, you can take the first step by truly spending the time with your C-tech, get to know each other, and get to move past understanding of each other’s worlds. It’s time to merge them into one.

The opportunity is too big to waste. And the penalty is too steep to pay.

Managing Complexity

Since 2004 IBM has been tracking through surveys the top (external) factors that contribute to a company’s management challenges. (You can download the survey here: http://www.ibm.com/services/us/ceo/ceostudy2010/)

Consistently on top was “Market Factors” but significantly, its importance in the ranking has been waning.  In 2004, for example, it was ranked number #1 with 84% of respondents.  In 2010, still ranked #1, it only got 56% of the responses.  Perspectives change.  And so do threats and opportunities.

Technological factors, on the other hand, went from sixth place in 2004 with 33% of the votes, to second place in 2010 with 39%.   And, the previous two years of the survey 2006 and 2008, Technology factors were ranked third.

What does this all mean to you?

From vision to strategy and from plan to action, nothing has had a more profoundly disruptive effect than technology.  Even the most talented executive teams have found this to be a difficult, occluded, and complex exercise.  Somehow, the jagged intersection between business and technology needs to be made clear.

That is exactly what we will be doing at CEO-to-CEO.  This is a place where you will get answers to today’s business challenges, which are inextricably tied to Information and Interactive Technologies.

What do you, a C-level executive, need to know to run your business?  What is important?  What is “noise?”  How can you tell the difference?  What’s new and exciting, and what’s a fad to ignore?  What can give you the edge, and what can push you over it?

Here, at CEO-to-CEO we will deliver practical knowledge in a way that’s approachable, provocative, and pragmatic.

The goal, in short, is to make sure you have all it takes to succeed.

So, fasten your seatbelts, move your trays to the upright and locked position, and get ready to see the business landscape from a whole new altitude and with a whole new attitude!

Welcome aboard!