Walter Adamson

What Best Buy could learn from David Bowie

On the 10th of January 2012 The Next Web noted how "David Bowie’s 2002 predictions about the future of music were pretty close". Bowie predicted, in 2002, that "The absolute transformation of everything that we ever thought about music will take place within 10 years, and nothing is going to be able to stop it".

Furthermore, as he rounded out his predictions he said something which really struck me, just as powerful as the predictions themselves:

"But on the other hand it doesn’t matter if you think it’s exciting or not; it’s what’s going to happen".

The day before, in Forbes, Larry Downes wrote about Best Buy (The People vs. Best Buy, Round Two) where he described the reaction to his first article Why Best Buy is Going out of Business...Gradually.

The responses to my article could, in the hands of the right senior executives, form the playbook for a compelling new strategy for Best Buy, one that could do far more than simply preserve the company’s existing market share. But rather than drink in all that free advice, the company’s responses simply wish it away. It’s more denial, now tinged with a dose of anger. According to Dr. Elisabeth Kübler-Ross’s classic psychiatric study, for a patient with a terminal diagnosis those are the first and second stages of grief.

In many years (OK, many, many years) as an entrepreneur, investor, and consultant working with Fortune 500 companies, I’ve found there are two kinds of senior executives. There are those who see mistakes as an opportunity to improve their business and those who waste their energy explaining away real problems.

Downes outlines reason after reason why best Buy needs to change, and how nothing they can do can change the progressions which are happening, for example:

• Online competitors are certainly part of Best Buy’s problem, but not for the reasons it thinks. What’s really going on is more basic. Best Buy just doesn’t understand its customers’ point of view.
• What I meant was that consumers easily adapt to alternative retail channels.  Before the Internet, there was catalog shopping and home shopping from television. For consumers, buying online was just the next step in an obvious progression of more convenient ways to buy.
• For brick-and-mortar retailers, however, the shift was jarring.  Moving online required new thinking, new management structures, and new strategies.
• To compete successfully against new online retailers, traditional retailers would also need to find ways to transform the expensive liabilities of physical locations with limited hours and high labor and inventory costs into assets that complemented rather than competed with the online experience.

Best Buy's leadership team's reaction, from what we see, is to create PR "crisis management" scripts for its staff, respond in rote, dig in, and deny. Nothing usual I suppose.

What is unusual is that David Bowie saw beyond his entire livelihood, his total current world view, and was able to articulate and to acknowledge its demise:

"Music itself is going to become like running water or electricity. So it’s like, just take advantage of these last few years because none of this is ever going to happen again".

Astounding really. Best Buy need David Bowie's help, don't you think?

Let's run over that quote from David Bowie once again:

"But on the other hand it doesn’t matter if you think it’s exciting or not; it’s what’s going to happen".

How do you break strong leadership teams out of their mindsets?

How do you demonstrate the "reality" which they cannot see?

What are the keys to action and follow-through and not just acknowledgement?

Please comment below.

Walter @adamson
http://xeeme.com/walter

Unparalleled cloud opportunity in Australia - Parallels

The Parallels Australia SMB Cloud Insights survey caught my attention. It's released as a pre-conference marketing promotion but it still contains some useful unbiased results.

The fact that it's benchmarked to similar surveys across the developed world is what makes it most relevant and interesting. It turns out that Australia is a poor cousin when it comes to cloud adoption, particularly in SMBs with 20 to 250 employees. For example, In other developed countries 49% of those report using hosted servers, whereas in Australia the figure is 22%. For smaller Australian businesses the uptake is about 60-70% of the other developed countries.

Of course "hosted servers" aren't really "cloud" - but managing hosted servers is what Parallels sells. The figures can be taken as indicative of the general attitude toward broader cloud services, with hosted servers being used as an example.

I wanted to post a question on the Parallels' blog, but what grabbed my attention was this, which I've never seen before:

WOW! Nifty.I've never seen that before. It helps both parties SEO-wise, to get the cross links, and I think it encourages a response (like mine!).

My questions

1. Parallels concludes that the strongest growth opportunity among Australian SMBs is targeting small businesses with less than 50 employees. What are the signals that would tell a service provider that such a business is getting ready to buy?
   I don't mean cold calling asking the direct question. But what, for example, would be the indirect question and signals - would it be mobile adoption or an application upgrade for example?
2. The larger, up to 250 employee, businesses were the real laggards compared to the rest of the world. They have bigger budgets, but the implied inhibitor is their own IT staff. What are the key inhibitions of the IT staff and how should they be addressed? Knowing that would open up a much bigger set of opportunities.

Is Australia lagging everywhere?

At the same time as Parallels noted Australia lagging in cloud adoption, I saw this report Security Risks Lead To A Third Of Australian Employers Banning Social Media. The biggest trends of our time, which will dramatically effect how business is done, are cloud, social and mobile. So our businesses are behind in cloud and banning social media!

Next we only need employers to come out with a survey saying "Employers declare iPhone a work menace!" and we'd have to start shedding tears. But wait - Australian employers “paralysed” in the face of consumerisation of IT - oh NO!

Unisys Asia Pacific vice president and general manager of IT outsourcing, Lee Ward, said employers were "paralysed" by the BYOT challenge, "over the last 12 months, employers have moved from "blissful ignorance" to "paralysed awareness" in the face of consumerisation of IT", she said.

What does this spell out? Opportunity!

Opportunity opportunity opportunity

For those who understand the business shifts and gains from cloud, mobile and social this spells out an "unparralleled" opportunity to get well ahead of the pack.

I'll be interested to see more details of the final Parallels Australian report, which they are releasing at their APAC Summit.

Where do you think the best opportunities lie, in the less than or more than 50 employee SMBs?

Where do you see the best business opportunities at the convergence of cloud, social and mobile?

See my question on Quora.

Please comment below.

Walter @adamson
http://xeeme.com/walter

Social media strategic, but no social media strategy - report

A recent HBR / SAS survey of how organisations are using social media is worth reading. Its analysis is biased towards SAS's interests in analytics and monitoring, but the data is interesting in itself.

For example:

• 75% of companies said that they don't know where their customers are talking about them - they're missing both the advocates and the detractors;
• 79% said they are using (58%) or planning to use (21%) social media, yet only 1/3 of those had a social media strategy in place;
• 42% said social media is integral to their overall goals and strategies; and,
• 32% said social media has been designated as a high priority by their organisation's executives.

There's a lack of alignment in those statistics between the perceived strategic value of social media and the lack of a strategy. Perhaps this is an opportunity?

Where do they see this "strategic value"?

This is the $64 question, because the respondents to this survey indicated that:

1. their social media efforts were directed by marketing (69%) followed by communications, PR and the web team; and,
2. the highest ranking challenge for organisations was understanding the potential of social media to make a difference to their business.

To me, this explains why these such factors as "fully utilising social media across the organisation" and "leveraging social media insights across the organisation" were ranked quite low as the "most pressing challenges", that is not too pressing at all.

If you don't fully understand the potential impact on the organisation, and the thought leadership is limited to marketing, then those other issues would not yet have been fully considered or appreciated.

Fully utilising social media and leveraging its insights across an organisation is a very challenging aspect of developing a social business.

Perhaps that will come to the fore in future surveys, as the experience with current activities grows.

What are your key take-aways from the survey?

How would social media efforts best expand from marketing to the broader organisation?

What is your interpretation of the mis-alignment of the strategic intent and the practice?

 

Walter @adamson

Social business beyond customer service

When I asked in a recent post "Is social business just better customer service?" I was being rhetorical.

There wasn't a rush of naysayers, so perhaps people agreed, or perhaps that post just dropped like a leaf in the Amazon?

Social business enhances many parts of a business beyond customer service:

• product cocreation
• organisational transformation
• customer led-sales
• project management
• business growth rates
• product launches
• attracting talent
• working through partners.

Social business is described by IBM this way:

Social business focuses on business outcomes, business models, and management related to the use of social media technologies.

Product Cocreation

That's obviously a definition which goes far beyond just customer service. And in fact IBM is a classic case of a company that is using social business in many ways beyond customer service, for example in collaborative new product develop. IBM sMash is a great example of product cocreation, with even the brand name coming from the community collaboration.

Transforming to a more innovative organisation

Kraft Food is a great example of transforming a large complex organisation to be more innovative with social business at the core.

Customer feedback accelerating sales

DELL facilitated customers serving themselves by putting a rating review system on its user forums and achieved a 138% increase in "intention to purchase". Perhaps this could be classified as "customer service" but I think it extends beyond the usual boundary. It's facilitation of customer conversations, combined with good analytics and measurement.

Project Management

Companies can improve project management through an integrated approach to social business. With regard to classic project dimensions of scope requirements, and change communication. Wendy Soucie has a really good presentation Project Management, Social Media, and Productivity and there is also The Social Media Project Manager. Social media can play a strong role here in making sure that everyone is on the same page, and that changes and variations are totally understood across the team, and thus help manage risk and cost. Organisations that move towards this as an ingrained culture will inevitably outperform their less socially aware peers - assertion!

Accelerating business growth

A small business example, AJ Bombers is the Milwaukee burger bar who have rocketed to success in a year, after starting business during the GFC - countering the odds! Owner Joe Sorge just saw social media and business as the way of doing things - in fact he says "customers are becoming the business".

Sorge says "this is a business built by social media; we don't know any other way to do it". Of course customer service is part of this, but AJ Bombers is a step beyond great customer service - he's developed a "whole product" of which customer service is just one part. Social business is the glue which holds it and folds it all together.

Product launches

Cisco "shaved six figures off its launch expenses and set a new precedent for future product launches" when it embraced social media as a key launch strategy. Cisco classified the launch as one of 5 most successful in the company history to that time, here are some stats:

• 9,000 people attended the social media product launch event;
• 90 times more attendees than in the past;
• Saved 42,000 gallons of gas;
• Nearly three times as many press articles as with traditional outreach methods;
• More than 1,000 blog posts and 40 million online impressions.

Attracting Talent

While talent may always be plentiful attracting the best is always a challenge. Some firms who take this very seriously exploit social media for this purpose very seriously. Can't not be a social business if you attract this way due to mismatch of expectations.

Beyond customer relationships - partners

IBM, in an excellent paper in its Redbooks Series, notes how social businesses achieves the following benefits:

1. Ideas that improve products and services;
2. Increased loyalty throughout the ecosystem; and,
3. Excitement that spills over into a broader network of people.

This is important for businesses which rely on partners to provide critical components and services. Social business can accelerate the flow of information across these networks of people helping them work together as a team and share information, skills, and expertise to solve problems and to innovate and to sell.

Caveat - a holistic approach is needed

Interestingly, Valeria Maltoni (@ConversationAge) wrote sometime ago a post entitled "Why Customer Service in Social is not Fair" in which she pointed out that being active in social media has a downside if not matched by other customer service channels - "It sends the message that when all else fails, complaining publicly will get to a resolution, and it usually does". Social business has to embrace all interactions with the customer.

An agile social media group working within a non-agile organisation is going to cause friction-burn, for the employees and customers!

Maltoni adds, "Unless your business plans to use what it learns online as an opportunity to fix internal processes, social outposts will continue to be expensive lightning rods." The route to using "social outposts" is to have a comprehensive social business strategy in order to understand how implementation and integration of such opportunities can be executed as a "way of doing business" - culture.

So "no", social business isn't just better customer service.

Please comment if you have examples of social business which go beyond great customer service.

Where would you start with social business transformation, the top of bottom or both?

Walter @adamson

3 Reasons to put Business back into Social Business

Three reasons to get "business" back into Social Business are: to manage its risk, complexity and cost as a major project initiative; to ensure it fits with business strategy and informs it from customer strategies; and, to ensure that it is effectively operationalised.

Getting "business" right is a pre-requisite to getting the use of social media right. The notion of Social Business (in the new for-profit sense) has evolved from discussions over the last couple of years that started with social media and evolved into such things as "social business design".

Social media in business was a prosumer innovation

It should have been the other way around - from goals to objectives to plans to actions, and using appropriate methodologies and tools along the way. But social media was a prosumer innovation - bringing personal tools into corporates, as was blogging only 5 or 6 years ago.

With everybody having now taken a deep breath, it's clear that companies with good culture, customer relations, products, services and innovation will succeed without social media, but they will multiply their own positive attributes via social media. For companies that don't have their act together, social media might well make things worse, in a number of ways, or at best just be a distraction. 

Social business has grown out of the effects of social media. We're now putting "business" into social business in order to get the cart before the horse.

Moving from social media to social business is a complex process

No news here. We've learnt that moving from social media to social business is a complex process, and even more so where the enterprise doesn't start from a clear coordinated strategy and culture.

As @deswalsh recently noted:

It’s one thing for a small firm to develop and implement a social media strategy, and even on a small scale there can be challenges, such as in terms of skill sets, organizational culture, time management issues, budget and accountability. At the enterprise level the challenges can be much more daunting.

So the #1 reason to put business back into social business is to be able to manage the risk and complexity (and cost) of the undertaking. This is done by consistent methodologies and training, and recognition of the way enterprises work and like to work on these kind of initiatives, by using people who are familiar with corporate behaviour.

Shaping business strategy in unison with social and customer strategies

Umair Haque wrote in From Social Media to Social Strategy that "Social media strategy fits inside a marketing (business, corporate) strategy, and is shaped by it. Social strategy fits outside business and corporate strategies, and shapes them. Social strategies are about rewriting the logic of the industrial era entirely, shifting gears in how we think, envisioning a broader, more powerful, more challenging use of social tools."

Social Business accepts that social media strategy "sits inside" a business strategy ( you could say it is one of the strategies supporting the goals and objectives of the business). And it is also informed and shaped by "social strategies" and in particular customer strategies.

The means of shaping business strategy in unison with social and customer strategies is the #2 reason that business needs to be put back into the social business which has evolved from the social media end. This is the business ability to look across the landscape of the business, the landscape of customers, to envisage and to innovate, and to know what will work and now work within the client enterprise. It's what good business consultants do, and they work within a framework.

In 140 characters Tweet This

3 Reasons to put Business back into Social Business
Follow @adamson on Twitter for more commentary like this. Follow hashtag #sobizco

Social business as a going concern

The #3 reason to put business back into social business is that the business - as whole - needs to be running all this when the consultants leave. The whole business needs to know why, have clarity of purpose, consistency of execution, and mutual commitment to each other and each department to each other, and to gain it from the customers.

This is the operational result. This isn't achieved through campaigns or any one department "getting" social media and social business, no matter how great the result. It's achieved through hard work of the consulting team, the client's team, and the various collaborating parties. Again, the frameworks and the interfaces and the measures for these complex activities need to all become institutionalized - this is the business of project implementation and change management and technology selection and integration. Social media per se isn't driving this success.

Consolidation of social business consulting groups is accelerating

There aren't many groups in the world, yet, who can provide this kind of service - to really put the business into Social Business. There is a consolidation and I wrote about Brian Solis joining Altimeter. I'm a Cofounder of the Social Business Consulting Group #sobizco and we are also representative of the consolidation.

2011 is the year in which more groups will merge and emerge, and Social Businesses will very clearly emerge as a new competitive force. We know, from Altimeter, that most Social Strategists and their programs lack maturity, with "only 23% of Social Strategists having a formalized program with long-term direction".

These new business-oriented merged consulting groups will help corporate Social Strategists develop a proactive program that gets ahead of the demands, and operate from a strategic planning position. This will ensure that they don't "fall behind in requests from vocal customers and internal business units", thereby becoming reactive and what Altimeter calls the "Social Media Help Desk".

Bringing proper program planning, shaping business strategy in unison with social and customer strategies, and having commitment and consistent execution are all keys to successful Social Business.

What do you think are the most important forces shaping Social Business in 2011?

Do you see a future for larger business-oriented social business consulting groups?

Walter @adamson

The ABC of Cloud Security

It's clear that security ranks high if not the highest in the general concerns about companies migrating to the cloud. This is despite reputable research organisations like Aberdeen reporting "Web Security in the Cloud: More Secure! Compliant! Less Expensive!"

Drawing on the findings from multiple benchmark studies on best practices in content security and security software as a service, Aberdeen’s analysis shows that users of cloud-based web security had substantially better results than users of on-premise web security implementations in the critical areas of security, compliance, reliability and cost. Compared to companies using on premise web security solutions, users of cloud-based web security solutions had 58% fewer malware incidents over the last 12 months, 93% fewer audit deficiencies, 45% less security-related downtime, and 45% fewer incidents of data loss or data exposure.

Or from a more biased perspective, take Zach Nelson, the "flamboyant" chief executive of NetSuite, who said recently on a visit to Sydney that his company’s Australian customer base wasn’t phased by the fact that its datacentres are hosted in the US.

The executive said “more importantly” his company’s customer base of medium-sized companies recognised that NetSuite’s datacentre practices, its ability to do backup and recovery and so on, were “far more efficient and available” than customers could do themselves.

That's the party line from Netsuite, most certainly from Salesforce.com, and many others. It's also what I would tell most customers and one useful reason to consider migrating to the cloud. But it's not the whole story! The whole story is much more complicated, so I'm going to boil it down to ABC, with the following parts:

1. customers ain't customers;
2. cloud security isn't the issue; and,
3. risk management.

Customers ain't customers

Small customers tend to have bad security and would get better security in the cloud, while super large customers tend to have security which is probably as good as the cloud (and even if it is not that is not the issue, see next section!). The cloud debate swirls rapidly and sometimes rabidly, and it makes it very difficult to usefully participate unless we do some segmentation.

Let's classify customers into three groups:

1. A Group are the Absolutes. These companies focus on achieving as near as they can to absolute security while still meeting their business operational goals - cloud providers, banks etc. These companies have the right people.
2. B Group are the Becomings. These companies are always "becoming better" at security. The positive description is that they apply "fit for purpose" security, and they span a range from those keeping on top of patches and defense to those always "one patch behind". They are always wanting to become better but its a question of time, money, priorities, and having the right people.
3. C Group are the Cannots. These companies just don't have the time, inclination, people, priority, whatever to get it right. It's all too hard, although they do play at it and occasionally, after something goes wrong, they have a crack.

What's the distribution?

I don't know and I haven't any numbers but I'm willing to place my bets on the table. I say the Cannots are 66%, the Becomings are 30% and the Absolutes are 4%. These are by number of companies.

The size of a company isn't the criteria - it's their security profile which places them in each segment. That said typically SMBs fall into the Cannots, and spread up into the Becomings.

My point, cloud security is not a restraining factor for the Cannots, in fact it's probably a blessing and even adds value (as well as reducing costs). In the main it is also not a restraining factor for the Becomings, as they are just shifting their mess to the cloud and should be line ball neither better or worse. Bland and bold statement I know, but hey?! Just to note that some of the Cannots and most of the Becomings would do well to consider the role of the Cloud Review Board (if you have a set of business people governing your business systems architecture then you need a Cloud Review Board).

However, for the Absolutes, it's another story. And it's not about cloud security per se.

Cloud security isn't the issue

The Absolutes know a lot about information and information systems security. That's why they are the Absolutes. The Amazons, Microsofts, Googles, Saleforces, Rackspaces have a lot of those people, because they are Absolutes, but they don't have them all. There are lots of other companies in the Absolutes.

It's fair to say that many of the key people in the Absolutes, both vendors and "customers", all know each other or of each other, and share a lot. I'm sure that they don't all agree with each other, and that supports my point.

It supports my point because they can all build secure online environments. That's what they do. But they're all building them to align with different business objectives and risk management objectives (see next section).

They're solving different problems because they have different business Goals, Objectives, Strategies, Plans and Actions. And because they all have unique environments which are not only optimised with respect to those goals, but also with respect to their legacy. That legacy is bound to be quite a complicated one, security-wise, for the Absolutes.

So if all the Absolutes can build great security in an online world, then why don't the Absolute "customers" move into the clouds of the Absolute vendors?

It's because as you come down from the top of the Goals, Objectives, Strategies, Plans, Actions hierarchy things start to increasingly messy i.e. the rubber on the road and "how things are done around here".

Even considering, say, 2 banks, who might have some Goals and Objectives and Strategies which seem remarkably undifferentiated, will be moving apart in their Plans and Actions. And we're still a ways up yet!

As we move down towards Standard Operating Procedures, and then Work Instructions, and then throw in Policies and Standards, and then how all those interact in normal times and in times of breach or threat.

That's when worlds move apart between the Absolutes. And that's why security per se isn't the issue, the issue is how to make all the moving parts mesh together in any migration to cloud.

And by the way it's also why "we're 27001 certified" etc from a cloud vendor doesn't mean much! It means something - that you're the same as all the other Absolutes in this respect. But it doesn't mean that an Absolute customer (or any other customer) can mesh with the vendor in the risk management sense, as below.

Risk management

The Absolutes will all have their risk management processes in place. For example it will be crystal clear how information flows and who does what under what circumstances and in what timeframe.

That risk management process would have been built up over time, it would be very expensive and extensive, it is not something that an Absolute wants to subject to perturbations without due cause.

Which leads to the burning question. What an Absolute most wants to know about the cloud is how can I optimally mesh my current risk management processes with the cloud provider processes in order to take advantage of cloud? Can I even get access to the information flow, the people, and produce the necessary outcomes, through the interfaces which the cloud provider is willing to provide?

To work through that process for core Absolute systems will take years. It's not technical and it's not about cloud security per se, it's organisational and it's risk management. It's going to require change on both sides, and the cloud vendors will have to come to the party or miss out.

That's for the Absolutes. For the Becomings and Cannots it's time now to start the process of mapping how to take advantage of what cloud offers today. It still takes planning, but it's a different world to the Absolutes.

What do you think is the biggest show-stopper for the Becomings and Cannots moving to the cloud - are they different?

What's the timeframe for the Becomings and Cannots - different?

How are the service provider opportunities different for each segment?

Reposted from my original at the NewLeaseG2M blog.

Related Articles

• Cloud misconceptions: security tops the list (accmanpro.com)
• The Crux of Pervasive Cloud Security (blogs.cisco.com)
• Gartner in private cloud security warning (v3.co.uk)

Why creativity is dangerous for business innovation

I don't have much time for the BS of what I call the "innovation industry", although I do certainly admire their ability to create wealth for themselves by selling this BS. But I resent the fact that I have to ultimately pay for it in services I buy e.g. I have to pay for the "Innovation Department" at the ANZ bank in my bank fees. When the banks award themselves prizes for their "innovation" it's always astounding how the "innovation" is the least of what you would expect as being an everyday part of the service.

The big banks have proven to be perfect candidates for the innovation industry, sold up the line on the need for "creativity" and brainstorming and plastering yellow sticky notes around rooms, and having performance artists jig around the room at management training. Personally I find most street performers plain dull, perhaps even stupid - I'm not their mother!

That's why creativity is dangerous for the vast majority of businesses. It diverts attention and resources from real business innovation. Let's put aside the 1 or 2% of companies that need to be and are genuinely creative, or inventive. They are a special case, not the 98% norm.

In which case the 98% norm would do a lot better, in my opinion, to follow Apple, an astoundingly uncreative company. After all the iPhone was the lowest common denominator of it's non-Apple ancestors. DoCoMo in Japan invented the "app-store" more than a decade ago, and it's still larger than the Apple app store is today. KDDI in Japan invented mobile music downloads, and their management and commercial deals with the record companies a decade ago. Sharp had the non-keyboard touch screen, and far superior camera and optics, many years before the iPhone version 1 etc etc.

BUT, Apple is the most successful. Because of their plain boring uncreative business innovation in combining, refining, and negotiating a great new ecosystem and value proposition for consumers. Street clowns and Innovation Departments not necessary!

Don't take it from me, Steven Jobs says "Good artists copy, great artists steal. And we have always been shameless about stealing great ideas."

When you get that happening as something everyone in the organization is responsible for all the time, and to the point that it happens in a casual and "unprofessional" manner because it is ingrained into every meeting and every conversation with customers and every observation of the market, then you are very likely to create real wealth. And innovation without wealth creation is not innovation.

But a mind-set change is never easy, and it is made harder by the innovation industry preaching creativity instead of the synthesis and analysis of customer and internal insights as an everyday practice.

That's why some people use different words, such as "imitation", to try to drive thinking away from the street performers. For example Oded Shenkar recently wrote in the Harvard Business Review (April 2010) that "Imitation Is More Valuable Than Innovation" and that "imitation is underappreciated". It's a good effort, but in my mind a pity that we can't use "innovation" in a business context to mean "business innovation" because it has been corrupted by "creativity".

Business innovation isn't "something from nothing" where that nothing has no context, which is how creativity seems to be often described. It may well be from a fantastic insight or synthesis of "white space" between existing services, products, thoughts or feedback, which in a sense is something from nothing but within a context.

And, counter-intuitively business innovation includes letting go of the things you once innovated yourself into and love to do. Letting go is often one of the hardest acts of business innovation, which Drucker pointed out a long time ago - his concept of "planned abandonment".

A key question that Drucker often liked to ask management was: "If we were to go into this now, knowing what we now know, would we go into it the way we are doing it now?"

There's nothing creative about that, but there is something authentic. Drucker also said, "Innovation opportunities do not come with the tempest but with the rustling of the breeze."

I say chasing creativity is destroying wealth for most businesses, that's why it is dangerous.

On the other hand, driving a culture of relentless curiosity about your own business, your customers' businesses, your competitor's businesses and markets, and knowing how to synthesis that and deliver it through your own organisation, is what I call business innovation. That's worth it's weight in gold, and it is sustainable.

Are you a "creativist" or a "sytheisist" when it comes to business innovation?

Do you think Apple just steals ideas, or what extra "secret sauce" do they add?

http://xeesm.com/walter

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Are you just social media overhead, asks Cisco Non-believer

There's a good conversation going on over at Social Media B2B where Jeffrey Cohen's post Cisco Social Media Manager Talks Facebook brought in a swift response from "Cisco non-believer":

...So you have a full-time job to maintain a facebook page? seriously? What happened to the model Cisco’s Anne Plese talked about at Blogworld where the employees engaged actively and built these capabilities in a collaborative model themselves and it did not take additional headcount and funding and was not a centralized command and control environment?"

It's a good challenge, because we then got more insight.  Although personally I take the view that a company like Cisco, and on the back of the GFC, isn't going to have any corporate positions that don't make business sense and are hard-justified. But hey the question was asked, and the conversation is great.

Autumn Truong @autumntt rose to the challenge with a very positive and open response, and explained the corporate coordination role and how "In my role, I’ve been very focused internally – working with various functional groups within my organization and across Cisco to understand how to effectively leverage social media to share information and communicate externally with our existing audience as well as a new set of influencers."

To me that makes a lot of sense. It's an overhead yes, but the price of lack of coordination could be much higher. I also believe that having someone free of the "operational" pressures allows them to spark new (often incremental) ideas which span functional groups and create real value from new social media initiatives. Without that person these opportunities fall through the cracks. 

It's all about balance

Coordination is necessary, and usually starts as a role. When the load gets big enough as in Cisco, these roles become jobs. Me being a graduate of the Social Media Academy one part of our methodology addresses the Cross Functional Corporate Social Media Framework.

This Framework, which we name the Comstar model, provides the understanding that a social media oriented corporation is actually applying a new state of mind to its culture and processes. The framework includes all departments such as sales, marketing, service & support, product management, HR, Logistics, and all other groups and its respective teams. The ComStar model suggest a social media service-team-based organization structure.

The Comstar Principle

At its core, the ComStar Model has one key principle, and it is this:

Develop a social media service team (SMST) that supports all departments in the organization The SMST members do not necessarily tweet, blog, comment themselves instead empowers others to do so. Similar to IT team, finance support or HR that services an entire company, the SMST functions the same way.

Cisco has this same idea in the cross-functional role described by Autumn Truong.

What do you think, is this "overhead" or a valuable and perhaps necessary role of cross-functional coordination in any larger firm moving towards a social business model?

http://xeesm.com/walter

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Bank cloud computing strategy unleashes new era of opportunity

Banks, the bane of our lives and the object of our derision over their lack of innovation and customer service - see mine recently - but hey! here's a decision which is business-innovative and one which will change the computing landscape in Australia from this day on, for the better.

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The Commonwealth Bank of Australia announced (at a private gathering of the Committee for the Economic Development of Australia CEDA) their new IT purchasing consortium with Deutsche Bank and Bank of America, AND their commitment to cloud computing.

So why the excitement?

Well the consortium is one thing, OK that's smart if they have common interests and can combine their purchasing power and save more than it takes them to coordinate the effort. But not transformational.

But the CBA’s group executive of enterprise services and CIO, Michael Harte, also said that they intended to decrease their current (in-house) infrastructure costs by 80% by moving to cloud computing.

The Australian IT press reacted in a perhaps predictable way - CBA attack dogs growl at computer giants - taking the plan as an attack on vendors and and IT suppliers and their businesses. Forgive me for differing but I think that Harte's decision and plan is the best thing that could happen to the Australian IT industry. More coverage.

Let's count off some points:

1. Harte has in one fell swoop knocked the "security and privacy" arguments on the head (see below);
2. He has in one fell swoop lifted the burden of education from cloud service provers;
3. He has in one fell swoop opened up avenues for massive innovation in the offering of cloud enterprise services;
4. He has in one fell swoop forced the IT industry to face up to where things were headed anyway, saving most the death of a thousand cuts.

While the IT industry is always keen to push change onto others (the users) and often fast to blame them for not bing willing to change, I've found myself, over many decades, that the IT industry and IT managers are the most stubborn and the most resistant of all to change.

Harte has done us all a favour

I can't help it if you don't like it - just suck it in and get on with it or get out of the business. We can't say that we haven't seen it coming as Harte himself has been telegraphing this strategy for about 4 years!

He's done us a massive favour by saying that, with respect to cloud computing, the security and privacy concerns are "actually the most easily fixed". This puts the bogey to rest that is most often rolled out by company execs as the reason not to move ahead on cloud offers. Just as this held back outsourcing, these decades down the path the same old reasons not-to-act are trotted out. From now on, refer them to the CBA and DB and BoA and ask these clients if they are really so special in their privacy and security that they cannot do what these global banks can do? This is a manna from heaven to cloud service providers.

For Software as a Service (SaaS) vendors, Harte says, "While infrastructure-as-a-service is mature, software-as-a-service is catching up fast. With inevitable security and legal structuring, applications will be more widespread and the terms of trade will continue to shift in favour of the buyer."

Great. This is also good news for the SaaS providers who really understand the game. This moves the SaaS game from technology with some plugged-on customer and web-centric engagement to a customer-centric web-centric value-added offer enabled by some appropriate technology. We help SaaS companies transform themselves that way, so we're hot to trot on this shot over the bows by Harte.

Succinctly, SaaS and cloud vendors need to move their innovation up, and their costs down.

Don't do that and you become the walking dead. You have Harte to thank for putting you out of your misery sooner rather that later, and he's done the industry a great service in firing the starting gun for a new era of transformation and opportunity in IT adding value to business.

http://xeesm.com/walter

PS Computerweekly quoted an "industry source" as saying "It is hard to tell if this is just a procurement play or a broader initiative, clearly the official announcement will tell us that. It is interesting that even the biggest players appear to believe that they still need more scale than they have individually to enable themselves to negotiate with the large providers, both in terms of price and product direction." 

When you have an industry which is brain-dead then you at some point have to turn off the life support system!

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Aussie businesses fear using, fear not using social media

According to the inaugural 2010 Social Media Business Benchmarking Survey, conducted by market analyst Nielsen on behalf of specialist social network developer Community Engine, half of all Australian businesses believe they will lose touch with customers if they do not use social media.

However there is also a business risk as fear of losing control sill ranks high, as does fear of abuse directed towards the brand or service. Measuring return on investment was nominated as a key barrier by 28% of organisations polled. Achieving senior management buy-in was also still challenging – particularly in large organisations. 

But the real kicker as far as I am concerned is that half of all Australian businesses believe they will lose touch with customers if they do not use social media.

Since social media fundamentally changes the way that people interact and the way organisations do business then is there any choice if you are in a competitive market? 

The issues raised can and have been solved, and we see a survey this week for example which says that Microsoft is the most social media-savvy company in the US, with IBM, one of its rivals, ranked #49. Microsoft has achieved huge internal culture change, and robust processes, and build a whole new way to relate to not only customers but also partners.

Solving the challenges of security, senior management buy-in, brand protection, brand strategy, closed versus open communities etc are nothing new. That's not to say that we don't learn new things each day, but the fundamental processes and principles can be learnt today. For example our Social Media Academy specifically teaches business managers and consultants these processes as part of a 32 hour curriculum Social Media Academy Certified Consultant (SMCC).

Does it matter if we wait, and can it really add value? 

Well yes, it matters! If you wait you not only risk losing touch with current and potential customers, but your more social media-savvy competitors will be racing ahead. They'll very quickly know more about your customers than you do, because what you know are facts and information in your CRM system. 

What your competitors will know are the people who comprise your customers, what they are thinking, what they are saying, what's on their mind at work, and at home. And from all that they'll build a social business relationship. At that point you've lost! 

In terms of shareholder value, well, in the recent transaction where Amazon bought the online shoe retailer Zappos analysts said that about $500m of the AU$1 billion paid was goodwill entirely for the social media savvy of Zappos. That's a key to the asset and culture which Amazon bought. Zappos built that internal capability and asset from scratch, it's all gain to shareholders. 

Businesses now have the opportunity to use social media to establish a long-term strategic asset, rather than short-term marketing campaigns, being the customer relationship, loyalty, and referrer value. There's no mystery. There are business processes. It's about the will to act, and 2010 is the year to act!

http://xeesm.com/walter