Lessons in Leadership:Tom Peters Seminar2001

Rollercoaster Days: Learning to … Rock & Roll!

Ft Lauderdale/05.22.2001

More at … tompeters.comSlides from this seminar;

Master Presentation, for in-depth; annotated Special Presentations

[Women Rule!, Design!, etc.].“Cool Friends” (referenced in seminar).

Discussions re this stuff.Calendar of events.

Lavender text in this file is a link.

“There will be more confusion in the business world in the next decade than in any decade in history.

And the current pace of change will only accelerate.”

Steve Case

“In 25 years, you’ll probably be able to get the

sum total of all human knowledge on a personal

device.”Greg Blonder, VC [was Chief Technical

Adviser for Corporate Strategy @ AT&T] [Barron’s 11.13.2000]

<1000A.D.: paradigm shift: 1000s of years1000: 100 years for paradigm shift

1800s: > prior 900 years1900s: 1st 20 years > 1800s

2000: 10 years for paradigm shift 21st century: 1000X tech change than 20th

century (“the ‘Singularity,’ a merger between humans and computers that is so rapid and profound it represents a rupture

in the fabric of human history”)

Ray Kurzweil, talk april2001

“The corporation as we know it, which is now 120 years old, is

not likely to survive the next 25 years. Legally and

financially, yes, but not structurally and economically.”

Peter Drucker, Business 2.0 (08.00)

“We are in a

brawl with no rules.”

Paul Allaire

S.A.V.

The Kotler Doctrine:

1965-1980: R.A.F.(Ready.Aim.Fire.)

1980-1995: R.F.A.(Ready.Fire!Aim.)

1995-????: F.F.F.(Fire!Fire!Fire!)

John Roth’s “Rules” [Nortel]

1. Our strategies must be tied to leading-edge customers on the attack.

2. Time cannot be sacrificed for better quality, lower cost, or even better decisions.

3. It doesn’t matter whether you develop or acquire leading technology. Our job is to provide the technology

and products our customers need.4. Success is achieved by leading change,

not waiting for it.5. We are paranoid about our leadership – willing to cannibalize our own products to maintain our edge.

Source: Abridged from The Wall Street Journal (07.25.00)

“Our strategies must be tied to leading edge

customers on the attack. If we focus on the defensive

customers, we will also become defensive.”

John Roth, CEO, Nortel

Read It Closely: “We don’t sell insurance

anymore. We sell speed.”

Peter Lewis, Progressive

I Believe …

1. Change will accelerate. DRAMATICALLY.2. We will RE-INVENT THE WORLD IN THE NEXT TWO GENERATIONS. (Business … Health Care … Politics … Fundamentals of Human Interaction.)

3. OPPORTUNITIES are matchless. 4. You are either … ON THE BUS … or … OFF THE BUS.5. THIS IS ALL GREAT FUN! I WANT TO PLAY! AND YOU?

Structure

Part I: Brand InsidePart II: Brand Outside

Part III: Brand Leadership

Part I: Brand InsidePart II: Brand Outside

Part III: Brand Leadership

Forces @ Work I

The Destruction Imperative!

Forget>“Learn”

“The problem is never how to get new, innovative

thoughts into your mind,

but how to get the old ones out.”

Dee Hock

“When asked to name just one big merger that had lived up to expectations, Leon

Cooperman, former cochairman of Goldman Sachs’ Investment Policy

Committee, answered: I’m sure there are success stories

out there, but at this moment I draw a blank.”

Mark Sirower, The Synergy Trap

“Acquisitions are about buying market share.

Our challenge is to create markets. There is a big difference.”

Peter Job, CEO, Reuters

“Our ideal acquisition is a small startup that has a great technology product on the drawing board that is going to come out in six to twelve months.

We buy the engineers and the next generation product. …”

John Chambers, Cisco

Lessons from the Bees!

“Since merger mania is now the rage, what lessons can the bees teach us? A simple one: Merging is not in

nature. [Nature’s] process is the exact opposite: one of growth, fragmentation and dispersal. There is no

megalomania, no merging for merging’s sake. The point is that unlike corporations, which just get bigger, bee colonies know when the time has come to split up into

smaller colonies which can grow value faster. What the bees are telling us is that the corporate

world has got it all wrong.”David Lascelles, Co-director of The Centre for the

Study of Financial Innovation [UK]

The [New] Ge Way

DYB.com

The Gales of Creative Destruction

+29M = -44M + 73M

+4M = +4M - 0M

Forbes100 from 1917 to 1987: 39 members of the Class of ’17 were alive in ’87; 18 are in ’87 F100; the 18 F100 “survivors” underperformed the market by

20%; just 2 (2%), GE & Kodak, outperformed the market from 1917 to 1987.

S&P 500 from 1957 to 1997: 74 members of the

Class of ’57 were alive in ’97; 12 (2.4%) of 500 outperformed the market from 1957 to 1997.

Source: Dick Foster & Sarah Kaplan, Creative Destruction: Why Companies That Are Built to Last Underperform the

Market

Brand Inside

Brand Org: Lean, Linked,

Electronic & Malleable

Headline: “Bank of America to Cut … 10,000 Jobs”

“Middle-level and senior managers are expected to be

the principal targets of the job cutbacks.”

Source: The New York Times (07.29.2000)

White Collar

Revolution!

108 X 5vs.

8 X 1** 540 vs. 8 (-98.5%)

The Pincer 5

“Destructive” entrepreneurs/ Global Competition

“White Collar Robots”

THE INTERNET! [E.g.: GM + Ford + DaimlerChrysler]

Global Outsourcing [E.g.: India, Mexico]

Speed!!

“A bureaucrat is an expensive

microchip.”Dan Sullivan, consultant and

executive coach

Automation+

75% of what we do: 40 “expert” decision rules!

IBM’s Project Eliza!

80,000?

“Assetless Company”

John Bryan, CEO, on selling all Sara Lee’s manufacturing

“Don’t own nothin’ if you can help it. If you can, rent your

shoes.”F.G.

Cisco, Dell =

Brand-owning companies who sell Customer

Satisfaction

Source: David Schneider & Grady Means, MetaCapitalism [e.g.: Cisco owns 2 of 38

assembly plants]

Brand Inside

Brand Work: The Professional Service

Firm Model & The WOW Project

So what will be the Basic Building

Block of the New Org?

Every job done in W.C.W. is

also done “outside”

…for profit!

Answer: PSF![Professional Service Firm]

Department Head

to …

Managing Partner, HR [IS, etc.] Inc.

New OrleansApril 2000:

NAPM

You are the …

Rock Stars of the

B2B Age!

“P.S.F.”: Summary

H.V.A. Projects (100%)Pioneer Clients

WOW Work (see below)Hot “Talent” (see below)“Adventurous” “culture”

Proprietary Point of View (Methodology)W.W.P.F. (100%)/Outside Clients (25%++)

When: Now!

11 September 2000

09.11.2000: HP bids

$18,000,000,000for

PricewaterhouseCoopersConsulting business!

[“These days, building the best server isn’t enough. That’s the

price of entry.”

Ann Livermore, Hewlett-Packard]

% Rev From Service:

GE (80%) … IBM (80%) … HP … Sun????

Mystery Co.

Turnkey.Collections.

Flexible sourcing.Packaging.

Merchandising.Promotion.

Design.Systems & Site mgt.

Maybe one [or more] of your “PSFs”

becomes the tail that wags the dog????? [E.g.: engineering, IS-logistics-

customer service]

The Raw Material …

The WOW Project!

“Reward excellent failures. Punish

mediocre successes.”

Phil Daniels, Sydney exec

Your Current Project?

1. Another day’s work/Pays the rent.4. Of value.7. Pretty Damn Cool/Definitely subversive.10. WE AIM TO CHANGE THE WORLD. (Insane!/Insanely Great!/WOW!)

“Learn not to be careful.”

Photographer Diane Arbus to her students (Careful = The sidelines,

per Harriet Rubin in The Princessa)

Brand Inside

Brand You: Distinct …

or Extinct

“New Economy changes how

firms treat layoffs”

Headline, USA Today (03.19.2001)

New World of Work

< 1 in 10 F500#1: Manpower Inc.

Freelancers/I.C.: 16M-25MTemps: 3M (incl. CEOs & lawyers)

Microbusinesses: 12M-27MTotal: 31M-55M

Source: Daniel Pink, Free Agent Nation

“If there is nothing very special about your work, no matter how hard you apply

yourself, you won’t get noticed, and that

increasingly means you won’t get paid much either.”

Michael Goldhaber, Wired

Minimum New Work SurvivalSkillsKit2001

MasteryRolodex Obsession (vert. to horiz. “loyalty”)

Entrepreneurial InstinctCEO/Leader/Businessperson/Closer

Mistress of ImprovSense of Humor

Intense Appetite for TechnologyGroveling Before the Young

Embracing “Marketing”Passion for Renewal

“You must realize that how you invest your human capital matters as much as how you

invest your financial capital. Its rate of return determines your future options. Take a job for what it teaches you, not for what it pays. Instead of a potential employer asking, ‘Where do you see yourself in 5 years?’

you’ll ask, ‘If I invest my mental assets with you for 5 years, how much will they

appreciate? How much will my portfolio of career options grow?’ ”

Stan Davis & Christopher Meyer, futureWEALTH

Invent. Reinvent. Repeat.

Source: HP banner ad

Brand Inside

Brand Talent: The Great War for Talent

The Case

“When land was the productive asset, nations

battled over it. The same is happening now for talented people.”

Stan Davis & Christopher Meyer, futureWEALTH

“We have transitioned from an asset-based strategy

to a talent-based strategy.”

Jeff Skilling, CEO, Enron

The Talent Ten

1. Obsession

P.O.T.* = All Consuming

*Pursuit of Talent

From “1, 2 or you’re out” [JW] to …

“Best Talent in each industry segment to build

best proprietary intangibles” [EM]

Source: Ed Michaels, War for Talent (05.17.00)

2. Greatness

Only The Best!

Home Depot: 7 new growth initiatives ($20B to $100B in 5-7 years)

Arthur Blank: BEST PERSON IN THE WORLD TO HEAD

EACH INITIATIVEE.g.: COO of IKEA to head

international expansion

Ed Michaels, War for Talent (05.17.00)

3. Performance

Up or out!

“We believe companies can increase their market cap 50 percent in 3 years. Steve

Macadam at Georgia-Pacific changed 20 of his 40 box plant managers to put

more talented, higher paid managers in charge. He increased

profitability from $25 million to $80 million in 2 years.”

Ed Michaels, War for Talent (05.17.00)

Message: Some people are better than other

people. Some people are a helluva lot better than other

people.

4. Pay

Fork Over!

“Top performing companies are two to four times more likely

than the rest to pay what it takes to prevent losing

top performers.”

Ed Michaels, War for Talent (05.17.00)

So-so plant manager, $1M per year. Pay: $110,000 plus $60,000. Top plant manager,

$3-4M per year. Pay: $135,000 plus $90,000. Net:

$2-3M for $50K.

Source: Ed Michaels et al., The War for Talent, re Georgia-Pacific

What gets measured gets done. What gets

paid for gets done more. What gets paid

a lot for gets done a lot more.

5. Youth

Grovel Before the Young!

“Why focus on these late teens and twenty-somethings? Because they are the first

young who are both in a position to change the world, and are actually doing so. … For the first time in history, children are more comfortable, knowledgeable and literate than their parents about an innovation central to society. … The Internet has

triggered the first industrial revolution in history to be led by the young.”

The Economist [12/2000]

6. Diversity

Mess Rules!

“Where do good new ideas come from? That’s simple! From

differences. Creativity comes from unlikely juxtapositions.

The best way to maximize differences is to mix ages, cultures and

disciplines.”

Nicholas Negroponte

“Diversity defines the health and wealth of nations in a new century.

Mighty is the mongrel. … The hybrid is hip. The impure, the mélange, the adulterated, the

blemished, the rough, the black-and-blue, the mix-and-match – these people are inheriting

the earth. Mixing is the new norm. Mixing trumps isolation. It spawns creativity,

nourishes the human spirit, spurs economic growth

and empowers nations.”

G. Pascal Zachary, The Global Me: New Cosmopolitans and the Competitive Edge

7. Women

Born to Lead!

“AS LEADERS, WOMEN RULE: New Studies find that female managers

outshine their male counterparts in almost

every measure”Title, Special Report, Business Week, 11.20.00

The New Economy …

Shout goodbye to “command and control”!

Shout goodbye to hierarchy!

Shout goodbye to “knowing one’s place”!

Women’s Stuff = New Economy Match

Improv skillsRelationship-centric

Less “rank consciousness”Self determinedTrust sensitive

IntuitiveNatural “empowerment freaks” [less

threatened by strong people]Intrinsic [motivation] > Extrinsic

“TAKE THIS QUICK QUIZ: Who manages more things at once? Who puts more effort into their appearance? Who usually takes care of the details? Who finds it

easier to meet new people? Who asks more questions in a conversation? Who is a better

listener? Who has more interest in communication skills? Who is more inclined to get involved?

Who encourages harmony and agreement? Who has better intuition? Who works with a longer ‘to do’ list? Who enjoys a recap to the day’s events? Who is

better at keeping in touch with others?”

Source: Selling Is a Woman’s Game: 15 Powerful Reasons Why Women Can Outsell Men, Nicki Joy &

Susan Kane-Benson

“Investors are looking more and more for a relationship with their

financial advisers. They want someone they can trust, someone who listens. In my experience, in general, women may be better at these relationship-building skills

than are men.”

Hardwick Simmons, CEO, Prudential Securities

“Boys are trained in a way that will make

them irrelevant.”

Phil Slater

It’s Girls, Stupid!

1996: 8.4M women, 6.7M men in college (est: 9.2 to 6.9 in 2007); more women than men in

high-level math and science courses

More girls in student govt., honor societies; girls read more books, outperform boys in artistic and musical ability, study abroad in

higher numbers

Boys do rule: crime, alcohol, drugs, failure to do homework (4:1)

Source: The Atlantic Monthly (May2000)

Read This!

“Winning the Talent War for Women: Sometimes It

Takes a Revolution”Douglas McCracken, HBR [11-12/2000]

“Deloitte was doing a great job of hiring high-performing women; in fact, women often earned

higher performance ratings than men in their first years with the firm. Yet the percentage of women

decreased with step up the career ladder. … Most women weren’t leaving to raise families; they had weighed their options in Deloitte’s male-dominated culture and found them wanting.

Many, dissatisfied with a culture they perceived as endemic to professional service firms, switched

professions.”

Douglas McCracken, “Winning the Talent War for Women” [HBR]

“The process of assigning plum accounts was largely unexamined. …

Male partners made assumptions: ‘I wouldn’t put her on that kind of

company because it’s a tough manufacturing environment.’ ‘That

client is difficult to deal with.’ ‘Travel puts too much pressure on women.’ ”

Douglas McCracken, “Winning the Talent War for Women” [HBR]

Okay, you think I’ve gone tooooo far.

How about this: DO ANY OF YOU SUFFER

FROM TOO MUCH TALENT?

63 of 2,500 top earners in F500

8% Big 5 partners

14% partners at top 250 law firms

43% new med students; 26% med

faculty; 7% deans

Source: Susan Estrich, Sex and Power

8. Weird

The Cracked Ones Let in the Light!

The Cracked Ones Let in the Light

“Our business needs a massive transfusion of talent, and talent, I believe, is most likely to be found

among non-conformists, dissenters and rebels.”

David Ogilvy

Axiom: Never hire anyone without an aberration in their

background!

“Andrew Higgins , who built landing craft in WWII, refused to hire graduates of engineering schools. He believed that they

only teach you what you can’t do in engineering school. He started off with 20 employees, and by the middle of the war

had 30,000 working for him. He turned out 20,000 landing craft. D.D. Eisenhower told me, ‘Andrew Higgins won the war for us.

He did it without engineers.’ ”

Stephen Ambrose/Fast Company

9. Opportunity

Make It an Adventure!

“Firms will not ‘manage the careers’ of their employees. They

will provide opportunities to enable the employee to develop

identity and adaptability and

thus be in charge of his or her own career.”

Tim Hall et al., “The New Protean Career Contract”

“H.R.” to “H.E.D.” ???

Human

Enablement

Department

10. Leading Genius

We are all unique!

Beware Lurking HR Types … One size

NEVER fits all. One size fits one. Period.

48 Players = 48 Projects =

48 different success measures

Goal of the Year No. 1*: Find-Develop-Mentor

ONE Extraordinary Person.

*CEO, large financial advisory firm, April 2001

MantraM3

Talent = Brand

What’s your company’s …

EVP?Employee Value Proposition, per Ed Michaels et al., The War for Talent

EVP = Challenge, professional growth, respect, satisfaction, opportunity, reward

Source: Ed Michaels et al., The War for Talent

HR Folks: YOU – not

“marketing” - “OWN” THE “BRAND PROMISE”!

(If you wish.)

Brand Inside

Brand Action:Getting Started … a

Personal Perspective

The following slide begins the “Boss-Free Implementation of

Stuff That Matters” Section. The slides in this section are heavily

annotated.

Use Normal or Notes Page View to access the notes.

Topic: Boss-free

Implementation of STM /Stuff That

MATTERS!

THE IDEA

“4Fs”: Find a

Fellow Freak

Faraway

World’s Biggest Waste …

Selling “Up”

Heart of the Matter

F2F!/K2K!/1@T/R.F.A.*

*Freak to Freak/Kook to Kook/One at a Time/ Ready.Fire!Aim.

THE NUGGET

Do Something. Do Anything.

Get Going.Now.

Opportunity ALWAYS Knocks

VFCJ* “Strategy”

*Volunteer For Crappy Jobs

Is It …

“The Oh-Hell-I-Wish-It-Were-Over Memorial Day picnic”

or

“The First Annual Seriously

Kewl Celebration of Our Incredible Staff”

Is It …

Wrestle the damn Safety Manual into line with the ridiculous new OSHA Regs?

Or …

A stealth opportunity to address the War for Talent via … a thoroughgoing review

of how safety and environmental issues contribute to making this a

Great Place to Work?

Is It …

Fix these bloody customer problems that have cropped up with the new 2783B?

Or …

A chance to work with a hotshot, young division GM on …

using the Internet/Internet Speed to revisit the entire process of how we get customer input – before and during the fact – into the

heart of the Product Design Process?

Reframers’ Rules:

Rule 1: Never accept an assignment as given! (Please.)

Rule 2: You’re never so powerful as when you are “powerless”!

Rule 3: Every “small” project contains the entire

enterprise DNA!

BOTTOM LINE

The Enemy!

Joe J. Jones Joe J. Jones 1942 – 2001 1942 – 2001

HE WOULDA DONE SOME HE WOULDA DONE SOME

REALLY COOL STUFF REALLY COOL STUFF

BUT …BUT …

HIS BOSS WOULDN’T LET HIM! HIS BOSS WOULDN’T LET HIM!

Characteristics of the “Also rans”*

“Minimize risk”“Respect the chain of

command”“Support the boss”

“Make budget”

*Fortune, article on “Most Admired Global Corporations”

The greatest dangerfor most of us

is not that our aim istoo high

and we miss it,but that it is

too lowand we reach it.

Michelangelo

Brand InsideReprise:

THINK WEIRD: The High Standard

Deviation Enterprise

Saviors-in-Waiting

Disgruntled CustomersFringe CompetitorsRogue Employees

Edge SuppliersWayne Burkan, Wide Angle Vision: Beat the

Competition by Focusing on Fringe Competitors, Lost Customers, and Rogue

Employees

Message: TAKE SOMEONE NEW & WEIRD TO LUNCH

TODAY OR TOMORROW. [Inundate yourself with weird.]

Button-down Org H.S.D.E. .

• Acquire for market share• Suck up to biggest customers• Pursue “strategic vendors”• Bigger is better• Accept assignments as given• Hire 4.0s from “top schools”• Promote when they’ve “paid

their dues”• Appoint a “prestigious” board

• Hang out with my pals• R.A.F.• Be “professional” at all

times/Honor thine elders

• Acquire for innovation• Partner with cool customers• Seek out pioneering vendors• Break it up … to refresh• Reframe all tasks to innovate• Hire “intriguing,” wherever• Promote tomorrow if the work

product is weird and WOW• Appoint an interesting,

headstrong board• Take a freak to lunch today• F.F.F.• Stay loose, stay cool/The hell

with thine elders

“But don’t we need some

grout between the tiles?”

N.W.O.: Was Is Is

• Pine-paneled Office• Address: 1 Big Man Plaza• Secretary• Suit • Formal • Rank conscious• Pretense (“Failures are

for fools.”)• I love “Yes men”• Self-contained

• Seat 9B, UA233• Address: Anne@Corp.com• Typing: 60 WPM• Casual M-F• Approachable• We are a HOT Team • Screwing up is as normal

as breathing• I love Misfits!• I love partners

Part I: Brand InsidePart II: Brand Outside

Part III: Brand Leadership

Forces @ Work II

The Commodity Trap

Quality Not Enough!

“While everything may be better, it is also increasingly the

same.”Paul Goldberger on retail, “The Sameness

of Things,” The New York Times

“We make over three new product announcements a

day. Can you remember them?

Our customers can’t!”Carly Fiorina

“The ‘surplus society’ has a surplus of

similar companies, employing

similar people, with similar educational backgrounds, working in

similar jobs, coming up with similar

ideas, producing similar things, with

similar prices and similar quality.”

Kjell Nordstrom and Jonas Ridderstrale, Funky Business

“Companies have defined so much ‘best practice’

that they are now more or less identical.”

Jesper Kunde, A Unique Moment

Brand Outside

Strategy 1:Use E-Commerce to

Re-invent Everything!

OVERVIEW

Tomorrow Today: Cisco!

90% of $20B (=$50M/day)75% mfg. outsourced; 50% of orders routed to supplier who ships direct

Gross margin: 65%; Net margin: 28%

Annual savings in service and support from customer

self-management: $550M

Enron eWorld: “Price a structured trade,” per John Arnold, 26: Early

1999: 30 times a day. Late 2000: 30 times per … minute.

Long-term gas contract. 1989: 9 months, 400+ deals. Late 90s:

2 weeks, 2 per week. Late 2000: 5 such deals per day

Source: www.ecompany.com (1/2001)

GM/Ford/DaimlerChrysler/Renault/Nissan/Oracle/CommerceOne

Covisint (02.2000)$240B (+$500B)90,000 Suppliers

$2-3,000/Car42 to 12-18 MonthsSource: Business2.0 (02.2001)

“This is the first meter of a 10-kilometer race.

Eventually, all markets will come to resemble today’s foreign exchange market.”

Hamid Biglari, Head of Corporate Strategy, Citigroup, in “GIGATRENDS”, Wired 04.01

X1,000,000

TowTruckNet.com

COMMUNITY SERVICES!/ CUSTOMER CONTROL!

Tomorrow Today: Cisco!

90% of $20B; save $550M

C.Sat e >> C.Sat H

Customer Engineer Chat Rooms/Collaborative

Design ($1B “free” consulting) (45,000 customer problems a week solved via

customer collaboration)

Welcome to

D.I.Y. Nation!“Changes in business processes will emphasize self service. Your costs as

a business go down and

perceived service goes up because customers are conducting it

themselves.” Ray Lane, Oracle

Anne Busquet/ American Express

Not: “Age of the Internet”

Is: “Age of Customer Control”

Simplicity!

“Revenues on the Web

are determined almost completely by

usability.”Jakob Nielsen (The Economist 04.28.01)

SWA

Simple!!!!!!!!!!!! (customers call because the process is so easy they can’t

believe they’re done)

30% of revenues directly from site (vs. 6% for others)

Source: Business Week (09.00)

RADICAL STRATEGIES

REQUIRED

“One cannot be tentative about this. Excuses like ‘channel

conflict’ or ‘marketing and sales aren’t ready’ cannot be allowed. Delay and you risk being cut out of your own market, perhaps not by traditional competitors but by companies you

never heard of 24 months ago.”

Jack Welch [07.00/Forbes.com]

GE & the Web

Purchasing: 2000: $6B; 2001: $15B

Sales: 1999: $1B; 2000: $7B; 2001: $20B+

Source: Business 2.0 (05.01)

“E-business is the final nail in the coffin

for bureaucracy at GE.”

Jack Welch/GE Annual Report 2000

“We’ve put the word out to all of our suppliers: by the end of the year [2000] we’ll only do purchasing

over the Internet.”John Paterson, C.P.O., IBM

[$50B from 18,000 suppliers]

WebWorld = Everything

Web as a way to run your business’ innardsWeb as connector for your entire supply-demand chain Web as “spider’s web” which re-conceives the industry

Web/B2B as ultimate wake-up call to “commodity producers”

Web as the scourge of slack, inefficiency, sloth, bureaucracy, poor customer data

Web as an Encompassing Way of LifeWeb = Everything (P.D. to after-sales)

Web forces you to focus on what you do bestWeb as entrée, at any size, to World’s Best at Everything

as next door neighbor

Message: eCommerce is not a technology play! It is a

relationship, partnership, organizational and

communications play, made possible by new

technologies.

Message: There is no such thing as an effective B2B or

Internet-supply chain strategy in a low-trust,

bottlenecked-communication, six-layer

organization.

“Ebusiness is about rebuilding the organization from the

ground up. Most companies today are not built to exploit the Internet.

Their business processes, their approvals, their hierarchies, the

number of people they employ … all of that is wrong for running an

ebusiness.”

Ray Lane, Kleiner Perkins

Magic!

[Inter]networked Markets

meet …

[Intra]networked Workers

Source: The Cluetrain Manifesto: The End of Business as Usual

“Supply Chain” 2000:

“When Joe Employee at Company X launches his browser, he’s taken to Company X’s personalized

home page. He can interact with the entire scope of Company X’s world – customers, other employees, distributors, suppliers, manufacturers, consultants. The browser – that is, the portal – resembles a My

Yahoo for Company X and hooks into every network associated with Company X. The real trick is that Joe

Employee, business partners and customers don’t have to be in the office. They can log on from a cell phone, Palm Pilot, pager or home office system.”

Red Herring (09.2000)

A DREAMER’S MEDIUM!

“There is no use trying,” said Alice. “One can’t believe impossible things.”

“I daresay you haven’t had much practice,” said the Queen. “When I was

your age, I always did it for half an hour a day. Why, sometimes I’ve

believed as many as six impossible things before breakfast.”

Lewis Carroll

I’net …

… allows you to dream dreams

you could never have dreamed

before!

Message: Survivors will move all their operations

to the Web. Now. Web = Encompassing … or else.

Message 2001: Only idiots pull in their

[investment] horns during a downturn.

“Believe in the Internet … MORE

THAN EVER.”Andy Grove, Cover quote, Wired (June 2001)

Brand Outside

Strategy 1A:Healthcare et al.:

Embracing ane-Led Age of

Self-Determination

The control revolution. The potentially monumental shift in

control from institutions to individuals made possible by new technology such as the Internet.

Source: Introduction, The Control Revolution, Andrew Shapiro

“The Web enables total transparency. People with

access to relevant information are beginning to challenge any type of

authority. The stupid, loyal and humble customer, employee, patient

or citizen is dead.”

Kjell Nordstrom and Jonas Ridderstrale, Funky Business

???????

Impact #1: Healthcare

THE FUTURE: Patients Rule!

Control Over Aging! [M&F Cosmetic Surgery, Viagra] Targeted Therapies = High Expectations The Internet! [meds, expert consultation, info-

knowledge incl. outcome data & own recs, interaction with peers & docs, awareness that experts aren’t]

Alt Therapies! [more visits, some insurer recognition]Awareness [medicine as front-page news, ads]

Boomers! [#s, $$$, Ethos of self-control]Prevention/Wellness

HMO [no-choice] Revolt“Age of Talent” [Be nice, boss!]

Speed! [surgicenters, out-patient, self-admin regimens]

“Savior for the Sick”

vs.

“Partner for Good Health”

Source: NPR/VPR 08.15.00

Sooooo …

Is your strategy centered around customer-client empowerment & self-

determination? Hint: This means letting go

of traditional sources of power!

Message: We are on the

cusp of a “People’s [customer/ patient/ citizen/ etc.]

Revolution.”

Brand Outside

Strategy 2A:

Women Rule!

?????????

Home Furnishings … 94%Vacations … 92%

Houses … 91%Consumer Electronics … 51%

Cars … 60% (90%)All consumer purchases … 83%

Bank Account … 89%Health Care … 80%

????

80%

Riding Lawnmowers

48% working wives > 50%80% checks

61% bills53% stock (mutual fund boom)

43% > $500K95% financial decisions/

29% single handed

Women … 50+%(!!!) of Web users; 6 of 10 new users; 83% of wired women are primary decision makers for family

healthcare, finances, education.

Source: Business Week; Jupiter Communications

$4.8T > Japan

9M/27.5M/$3.6T > Germany

New golfers … 37%Basketball … 13.5M

1 in 27 (’70) … 1 in 3 (’96)

1874?

1874 … Jock Strap1977 … Jogbra

1977 ... 25K

1996 … 42M

Yeow!

1970 … 1%

2002 … 50%

OPPORTUNITY

NO. 1!*[* No shit!]

Carol Gilligan/ In a Different Voice

Men: Get away from authority, familyWomen: Connect

Men: Self-orientedWomen: Other-oriented

Men: RightsWomen: Responsibilities

FemaleThink/ Popcorn

“Men and women don’t think the same way, don’t communicate the same

way, don’t buy for the same reasons.”

“He simply wants the transaction to take place. She’s interested in creating a relationship. Every place women go,

they make connections.”

“Men seem like loose cannons. Men always move faster through a store’s

aisles. Men spend less time looking. They usually don’t like asking where things are.

You’ll see a man move impatiently through a store to the section he wants,

pick something up, and then, almost abruptly he’s ready to buy. … For a

man, ignoring the price tag is almost a sign of virility.”

Paco Underhill, Why We Buy* (*Buy this book!)

Women and Healthcare

Women are … more dissatisfied, frustrated by the way they are treated and spoken down to by physicians, seek more information, are more pressed for

time … and make 75% of health care decisions and control 2/3 of health care $

$$$ [and constitute 2/3 of health care employees].

Source: Patricia Braus, Marketing Healthcare to Women

Women and Financial Advisors

Women want … a plan, to be listened to, to be taken seriously, to read about it, to think about it.

Women do not want … an in-your-face sales pitch

Source: Kathleen Boyle, Wheat Boyle Butcher Singer

“Women Beat Men at Art of Investing”

Source: Miami Herald, reporting on a study by Profs. Terrance Odean and Brad Barber, UC Davis (Cause: Guys are “in and out” of

stocks more often; women choose carefully and hold on for the long term)

Value Line: Top State* Investment Clubs 2000

8 … All male19 … Coed

22 … All FEMALE

* VT & Maine not included; D.C. included

Marketing to Women: Help Them Save Time!

80% … work86% … cook

58% … run errands with kids38% … take child to school

21% … go to the gym21% … take outside classes

How Many Gigs You Got, Man?

“Hard to believe … Different criteria”

“Every research study we’ve done indicates that women really care about the relationship with their

vendor.”

Robin Sternbergh/ IBM

Read This Book …

EVEolution: The Eight Truths of Marketing to Women

Faith Popcorn & Lys Marigold

EVEolution: Truth No. 1

Connecting Your Female Consumers to Each

Other Connects Them to Your Brand

“The ‘Connection Proclivity’ in women starts early. When asked,

‘How was school today?’ a girl usually tells her mother every

detail of what happened, while a boy might grunt, ‘Fine.’ ”

EVEolution

“Women speak and hear a language of connection and intimacy, and men

speak and hear a language of status and independence. Men communicate to obtain information,establish their

status, and show independence. Women communicate to create

relationships, encourage interaction, and exchange feelings.”

Judy Rosener, America’s Competitive Secret

[“I only really understand myself, what I’m really thinking and feeling, when I’ve talked it over with my circle of female

friends. When days go by without that connection, I feel

like a radio playing in an empty room.”

Anna Quindlen]

What If …

“What if ExxonMobil or Shell dipped into their credit card database to help commuting women

interview and make a choice of car pool partners?”

“What if American Express made a concerted effort to connect up female empty-nesters

through on-line and off-line programs, geared to help women re-enter the workforce with today’s

skills?”

EVEolution

“Women don’t buy

brands. They join them.”

Faith Popcorn, EVEolution

Not!!

“Year of the Woman”

Enterprise Reinvention!

RecruitingHiring/Rewarding/Promoting

Structure Processes

MeasurementStrategyCulture Vision

Leadership

THE BRAND ITSELF!

“Honey, are you sure you have

the kind of money it takes to

be looking at a car like this?”

THIS JUST MIGHT BE THE BIGGEST

“THING” IN THIS SEMINAR.

[PLEASE: THINK ABOUT IT!]

Psssst! Wanna see my “porn” collection?

27 March 2000: email to TP from Shelley Rae Norbeck

“I make 1/3rd more money than my husband does. I have as much financial

‘pull’ in the relationship as he does. I’d say this is also true of most of my women

friends. Someone should wake up, smell the coffee and kiss our asses long enough

to sell us something! We have money to

spend and nobody wants it!”

STATEMENT OF PHILOSOPHY: I am a businessperson. An analyst. A pragmatist. The enormous social good of increased women’s

power is clear to me; but it is not my bailiwick. My “game” is haranguing business leaders

about my fact-based conviction that women’s increasing power – leadership skills

and purchasing power – is the strongest and most dynamic force at work in the American

economy today. Dare I say it as a long-time Palo Altan … THIS IS EVEN BIGGER THAN THE

INTERNET!

Tom Peters

“If we are single, they say we couldn’t catch a man. If we are

married, they say we are neglecting him. If we are divorced,

they say we couldn’t keep him. If we are widowed, they say we

killed him.”

Kathleen Brown, on the joys of female political candidacy

Ad from Furniture /Today (04.01):“MEET WITH THE EXPERTS!: How

Retailing’s Most Successful Stay that Way”

Presenting Experts: M = 16;

F = ??

0

“Amazing. A bunch of guys sitting around designing

shopping centers!”

“Men may think they buy home furnishings, but that’s because women are smart enough to appeal to their

vanity and pretend to have consulted them.”

Some Possible First Steps

Data! (market research/best practices)

Women as project managers/critical mass for many/most new product &

marketing teams

Strategic recruitment & promotion program (D&T)

“Critical Mass” of women on the Board (“rule of three”)

Brand Outside

Strategy 2B:

Welcome to “Old World”!

“ ‘Age Power’ will rule the 21st century, and we are woefully

unprepared.”Ken Dychtwald, Age Power: How the 21st

Century Will Be Ruled by the New Old

Subject: Marketers & Stupidity

“It’s 18-44, stupid!”

Subject: Marketers & Stupidity

Or is it: “18-44 is stupid,

stupid!”

2000-2010 Stats

18-44: -1%

55+: +21%(55-64: +47%)

[ Member Growth: 1987 – 1997

18 – 34: 26%35 – 49: 63%

50+: 118%Source: IHRSA]

TP to IHRSA: Look this way! I am your ideal body

type!

Aging/“Elderly”

$$$$$$$$$$$$“I’m in charge!”

50+

$7T wealth (70%)/$2T annual income50% all discretionary spending

79% own homes/40M credit card users41% new cars/48% luxury

$610B healthcare spending/74% prescription drugs

5% of advertising targetsKen Dychtwald, Age Power: How the 21st

Century Will Be Ruled by the New Old

Priorities: Aging/“Elderly”

Experiences … Convenience … Comfort

… Access … Respect!

60>20**Italy, first time in human history

Source: Ken Dychtwald, Age Power

Census Y2000

A First: Married couples with children < 25% of

households! (23.5% vs. 45% in ’60)

35-54: Up 32%, to 82M (“This age group is used to redefining” – Dan Growhoski,

True North Communications)

Brand Outside

Strategy 2C:

Welcome to “Green World”!

And #3: GREEN?????: 50% to 36%: Protect Environment >

Economic Growth.

58% to 34%: Protect Plants & Animals > Preserve Private

Property Rights.

“Of all the ways the company will be judged over the next

decade, none will be greater than our

response to the issue of climate change.”

William Clay FORD Jr.

No: “Target Marketing”

Yes: “Target Innovation” & “Target Delivery Systems”

Brand Outside

Strategy 3A:

Design Matters!

All Equal Except …

“At Sony we assume that all products of our competitors have basically the same

technology, price, performance and

features. Design is the only thing that differentiates one product from another in the

marketplace.”Norio Ohga

“What’s imperative is the creation of a style that

becomes a culture linking you to the community. You

can only do that through good design.” – Anita Roddick

Source: Design Council [UK]

“We don’t have a good language to talk about this kind of thing. In most people’s

vocabularies, design means veneer. … But to me, nothing could be further from the

meaning of design. Design is the fundamental soul

of a man-made creation.”Steve Jobs

Unconventional [Design] Messages

Not about ... “Lumpy Objects”!

Not about ... $79,000 objects

The I.D. [International Design] Forty*

Airstream … Alfred A. Knopf … Apple Computer … Amazon.com …

Bloomberg … Caterpillar … CNN … Disney … FedEx … Gillette … IBM … Martha Stewart … New Balance …

Nickelodeon … Patagonia … The New York Yankees … 3M … Etc.

* List No. 1, 1999

Design Transforms even the [Biggest] Corporations!

TARGET … “the champion of America’s new design democracy” (Time) “Marketer of the Year 2000”

(Advertising Age)

Design “is” … WHAT & WHY I LOVE.

LOVE.

I LOVE my ZYLISS Garlic Peeler!

Design “is” … WHY I

GET MAD. MAD.

Wanted: Dead [preferably] or Alive: THE DESIGNER OF MY RADIO SHACK

PHONE. Major Reward!

“I’m just going to come right out

and say it: Ericsson lost $2.3B on mobile phone

handsets last year because its products

are ugly.”Peter Martin (FT 04.24.01)

Design is never neutral.

Hypothesis: DESIGN is the principal difference

between love and hate!

THE BASE CASE: I am a design fanatic. Personally, though not “artistic,” I’m a cool-stuff guy. I love what

I love and I hate what I hate. [Openly.] But it goes [much] further, far beyond the personal. Design has

become a professional obsession. I – SIMPLY – BELIEVE THAT DESIGN PER SE IS

THE PRINCIPAL REASON FOR EMOTIONAL ATTACHMENT [or detachment] RELATIVE TO A

PRODUCT OR SERVICE OR EXPERIENCE. Design, as I see it, is arguably the #1 determinant of

whether a product-service-experience stands out … or doesn’t. Furthermore, it’s “one of those things” …

that damn few companies put – consistently – on the front burner.

Message:“Services” are Not Intangible!

You “give off” hundreds of design cues … daily!

YOU ARE A DESIGNER!

First Steps: “Beauty Contest”!

• Select one form/document: invoice, air bill, sick leave policy, customer returns-claim form

• Rate the selected doc on a scale of 1 to 10 [1 = Bureaucratica Obscuranta/ Sucks; 10 = Work of Art] on three dimensions: Beauty, Grace, Clarity

• Re-invent!• Repeat, with a new selection, every 15

working days.

Design Rules! [Literally]

Palm Beach County’s U.C.B.* [*Utterly Confusing Ballot]

Brand Outside

Strategy 3B:

It’s the Experience!

“Experiences are as distinct from services as services are from

goods.”Joseph Pine & James Gilmore, The

Experience Economy: Work Is Theatre & Every Business a Stage

“The [Starbucks] Fix” Is on …

“We have identified a ‘third place.’ And I really believe that sets us apart. The third place is

that place that’s not work or home. It’s the place our

customers come for refuge.”Nancy Orsolini, District Manager

Experience: “Rebel Lifestyle!”

“What we sell is the ability for a 43-year-old accountant to dress in black leather, ride

through small towns and have people be afraid of him.”Harley exec, quoted in Results-Based

Leadership

“Car designers need to create a story. Every car provides an

opportunity to create an adventure. …“The Prowler makes you smile. Why? Because it’s focused. It has a plot, a

reason for being, a passion.”

Freeman Thomas, co-designer VW Beetle; designer Audi TT

Hmmmm(?): “Only” Words …

StoryAdventure

Smile Focus

PlotPassion

Plot

Williams Sonoma = 5 [was 10]Crate & Barrel = 8

Sharper Image = 9+Smith & Hawken = 8+

Garnet Hill = 9L.L. Bean = 4 [was 9+]

Colonial Williamsburg = ?

The “Experience Ladder”

Experiences Services

Goods Raw Materials

1940: Cake from flour, sugar (raw materials economy): $1.00

1955: Cake from Cake mix (goods economy): $2.00

1970: Bakery-made cake (service economy): $10.00

1990: Party @ Chuck E. Cheese (experience economy) $100.00

Message: “Experience” is the

“last 80%.” “Experience” applies to

all work!

HP Revisited

PWC Consultants lead Business Re-invention Process (“Experience

Economy”)

Fabulous Customer Service (“Service Economy”)

Terrific Servers (“Goods Economy”)

Brand Outside

Strategy 4:

BRAND POWER!

“WHO ARE YOU [these days] ?”

TP to Client

“We are in the twilight of a society based on data. As information and intelligence become the domain of computers, society will place more value on the one human ability that cannot be automated: emotion.

Imagination, myth, ritual - the language of emotion - will affect everything from our purchasing decisions

to how we work with others. Companies will thrive on the basis of their stories and myths. Companies will need to understand

that their products are less important than their stories.”

Rolf Jensen, Copenhagen Institute for Future Studies

“Most companies tend to equate branding with the company’s marketing. Design a new marketing

campaign and, voila, you’re on course. They are wrong. The task is much bigger. It is about fulfilling our potential … not about a new logo, no matter how

clever. WHAT IS MY MISSION IN LIFE? WHAT DO I WANT TO CONVEY TO PEOPLE? HOW DO

I MAKE SURE THAT WHAT I HAVE TO OFFER THE WORLD IS ACTUALLY UNIQUE? The brand has to give of itself, the company has to give of itself, the management has to give of itself. To

put it bluntly, it is a matter of whether – or not – you want to be … UNIQUE … NOW.”

Jesper Kunde, A Unique Moment

Brand = You Must Care!

“Success means never letting the competition

define you. Instead you have to define yourself based on a point of view you care deeply

about.” Tom Chappell, Tom’s of Maine

Remember!

Talent = Brand*

* And don’t forget Hal R.

Vineyard Haven MA: A&P Fun in the Sun

Store

DO THE EMPLOYEES

BUY THIS ACT?

“Brand Promise” Exercise: (1) Who Are WE? (poem/novella/song, then 25

words.) (2) List three ways in which we are UNIQUE … to our Clients.

(3) Who are THEY (competitors)? (ID, 25 words.)

(4) List 3 distinct “us”/”them” differences. (5) Try “results” on your teammates. (6) Try ’em on a friendly Client. (7) Big Enchilada:

Try ’em on a skeptical Client!

1st Law Mktg Physics: OVERT BENEFIT (Focus: 1 or 2 > 3 or 4/“One Great Thing.”

Source #1: Personal Passion)

2ND Law: REAL REASON TO BELIEVE (Stand & Deliver!)

3RD Law: DRAMATIC DIFFERENCE (Execs Don’t Get It: “intent to purchase” – 100%;

“unique” – 0% to 5%)

Source: Jump Start Your Business Brain, Doug Hall

Message: REAL Branding is personal. REAL Branding is integrity. REAL

Branding is consistency & freshness. REAL Branding is the answer to WHO

ARE WE? WHY ARE WE HERE? REAL Branding is why I/you/we [all] get out of bed in the morning. REAL Branding can’t be faked. REAL Branding is a systemic, 24/7, all departments,

all hands affair.

“WHO ARE WE?”

WHAT’S OUR

STORY?

“ WHY DOES IT MATTER TO

THE CLIENT?”

“EXACTLY HOW ARE

WE DIFFERENT?”

“EXACTLY HOW DO I PASSIONATELY CONVEY THAT

DIFFERENCE TO THE CLIENT ”

Part I: Brand InsidePart II: Brand Outside

Part III: Brand Leadership

Brand Leadership

Passion Rules!

“Leadership is a performance. You have to be

conscious of your behavior, because everybody else is.”

Carly Fiorina

“You must be the change you

wish to see in the world.”

Gandhi

“Leaders achieve their

effectiveness chiefly through

the stories they relate. In addition to communicating stories, leaders embody those

stories.”Howard Gardner, Leading Minds:

An Anatomy of Leadership

“Create a Cause, not a ‘business.’

”Gary Hamel, Fortune (06.00), on re-inventing a

company (Exemplar #1: Charles Schwab)

“As Ministers of The Republic of Tea, our

not-so-covert mission is to carry out a Tea

Revolution.”Ron Rubin & Stuart Avery Gold,

success@life

“Our free and open immigration policies welcome all who wish to flee the tyranny of

coffee crazed lives and escape the frazzled fast paced race-to-stay-in-one-place existence that it fuels. In our tiny land, we have come to learn

that coffee is about speeding up and losing sight, while tea is about slowing down and

taking a look. Because tea is not just a beverage, it is a consciousness altering

substance that allows for a way of getting in touch with and taking pleasure from the beauty

and the wonder that life has to offer.”

Ron Rubin & Stuart Avery Gold, success@life

Brand Leadership: ENTHUSIASM RULES!

Ben Zander: “I am a dispenser of

enthusiasm.”

“Entusiasmatore”

Word invented by Silvio Berlusconi, meaning enthusiast-salesman

Message: Leadership is all about love! [Passion, Enthusiasms, Appetite for Life,

Engagement, Commitment, Great Causes & Determination to Make a

Damn Difference, Shared Adventures, Bizarre Failures, Growth, Insatiable

Appetite for Change.] [Otherwise, why bother? Just read Dilbert. TP’s final words: CYNICISM SUCKS.]

“Let’s make a dent in the universe.”

Steve Jobs