If leadership is like gardening, is Jeff Bezos is the supreme gardener?

If leadership is like gardening, is Jeff Bezos is the supreme gardener?

Jul 8, 2019 | Strategy

Gardening may be an unusual metaphor for business building, but it works on a number of levels.

My grandfather was a keen, and hugely knowledgeable gardener, with a marvellous array of plants, edible, original, and decorative, coming together in a display that Henri Matisse would have been proud of, all year round.

As a young boy, drafted into digging some of his evil smelling concoctions into  the gardens with the spade he kept just for me,  he used to tell me he had only three jobs in the garden:

  1. Shape the environment in which the gardens (front and back were distinctly different) lived to best serve the plants he might want
  2. Plant the seeds at the right time, in the right numbers, in the best spots possible
  3. Nurture the shoots, giving them every opportunity and assistance to grow, but being prepared to dig them out when they failed to thrive, or a better use for the ground emerged.

This sounds very like what Bezos is doing with Amazon, the business, exemplified by the creation of Amazon Spheres, the gardens, at the Seattle headquarters. 

 

Long term planning is dead, long live long term thinking

Long term planning is dead, long live long term thinking

Jul 3, 2019 | Change, Governance, Strategy

 

Planning for the long term is a game for losers.

In a world where we have difficulty planning what will happen next month, locking yourself into a long term plan, which allocates resources, and makes binding decisions about the required capabilities, and how to build and deploy them, is crazy.
By contrast, long term thinking, retaining your perspective for the longer term, but being able to be agile in the shorter term, makes way more sense.

The makeup of the top 100 companies has changed dramatically in the past 10 years, and is unrecognisable from the top 100 of 1990. This should give us a clue.

Corporations of the 20th century grew by building scale, marketing, operational, geographic and financial. In the quest for scale they also built silos, bureaucracies, and cultures of  personal safety, risk aversity, and dependence on what worked in the past to  continue to work into the future.

Successful corporations now must be much more agile and responsive to change, even when they  are huge. The necessary process of devolving both authority and responsibility down the tree to where the interaction with operations really happens, makes them look more like a collection of smaller businesses than a corporate monolith.

The new model works. Perhaps the greatest example of this management about-face, while not of a commercial corporation, is the change in the US military retold  in Stanley McCrystal’s great book Team of Teams .

It is unstated, but the current political argument in Australia about the tax cuts legislation is an example of the failure of long term thinking. It substitutes a flimsy long term plan for intelligent long term thinking. Even worse, it is long term planning with an objective that is political, rather than economic or responsible. It is a wedge job on the opposition, and is a great example of why we do not trust politicians, and politics. We know such a long term plan, legislating for something as fundamentally important as a tax framework is nonsense. However, we accept the value of long term thinking, recognising the need to consider the manner in which tax rates make us competitive with other economies, at the same time as raising the revenue to deliver the community outcomes we all demand.

 

 

 

What price experience?

What price experience?

Jul 1, 2019 | Branding, Governance, Strategy

It seems to me that the development of robust, lasting, measureable and implementable strategy and marketing has gone to the dogs.

We are infested with short term rubbish that reflects the lack of experience of those doing the developing, and lack of understanding of those doing the commissioning, obsessed as they are with the short term.

Last week, Bloomberg revealed that the software in the Boeing 737 Max was outsourced to a bunch of recent graduates in India. Unfortunately, we all know the result of that exercise.

Not only were hundreds killed in the two crashes that followed, but the brand ‘Boeing’ took a dive with them.

How is that for the ROI on a few bob saved on experience!

You cannot put an old head on a young dog, all they do is yap.

Where does the ‘essential essence’ of marketing hide?

Where does the ‘essential essence’ of marketing hide?

Jun 21, 2019 | Branding, Marketing, Strategy

 

Great marketing is never entirely rational.

If it was we would call it economics, and be bored to death by its recitation.

‘Rational’ relies on precision, mathematics, and repeatability, not characteristics often seen in the behaviour of human beings.  We are driven by automatic things buried deep in our brains that have evolved to enable our relatively physically weak species, to become the dominant species on earth.

Individually our ancestors could not beat off a sabre toothed tiger, but together we saw them disappear while we prospered. We are disproportionally attuned to detect danger before we detect happiness, a foe before a friend, and are initially suspicious of anyone from outside the ‘tribe,’ and anything we do not understand.

Great marketing is the opposite to rational. It demands attention because it is different, it creates curiosity, because it is unexpected,  and interest because it is of value.

Creativity is the core of great marketing, as without creativity, every marketing strategy would be the same.  All marketers have access to the same data, can apply the same logic to a challenge, use the same models,  have the same distribution, so if logic reined, all would be the same for the same sort of product.

Instead, we have a cornucopia of strategies and tactical implementations, driven by some level of creativity. These days, sadly, most of the creativity has been squeezed out by the algorithms and demands of the rationalists running enterprises,  which is why there is so much poor marketing and advertising around.

If you want to be seen, be different, cause a stir in the bushes, build curiosity, be creative!

It will not always work as you expect, as creativity is about being first, which is usually bold and risky, it will not always win hearts and minds in the corner office, but as a marketer, it is your duty!

 

Header cartoon from the great Hugh McLeod at www.gapingvoid.com

 

 

Blowing up 5 myths about strategy

Blowing up 5 myths about strategy

Jun 13, 2019 | Strategy

Strategy sessions are often seen as an annual, 3 day bonding session at a nice spot away from the usual distractions, with little application to the daily business.

Nothing could be further from the truth.

Strategy is not just about the long term.

A robust and effective strategy is cascaded into a series of increasingly detailed plans with actions and accountabilities attached. A ‘waffly’ strategy stuck on the foyer wall will do nothing, but a strategy that works will not just drive everything down to the daily level, it will perhaps more importantly, tell everyone why they are doing the things they are doing, and what their role is in delivering success. This contributes to a culture of collaboration and performance.

Sustainable competitive advantage is a dead idea.

 Nonsense! Identifying your competitive advantage and doubling down on it is more important than ever, simply because the pace of competition is so much quicker, and your actions are transparent to those who choose to watch. This makes it critical that you have an advantage, but that you also continue to enable its evolution at a pace quicker than the competition.  The key is the cycle time of innovation in the orbit of your competitive advantage.

Agility trumps strategy.

Strategic clarity enables quick decisions about where, when and how to be agile. Agility by itself may look nice, but is useless unless used to deliver value. Strategy is all about delivering long term value, being agile is a component of a robust strategy. It is a capability that enables you to move quickly within the established strategic framework towards an explicit goal.  

A Digital strategy is essential.

Digital capability is increasingly critical to commercial success, but digital capability is not a strategy, it is a contributing factor to a sustainable strategy. Do you have a telephone strategy? Business would not be able to be done without a phone, how about an electricity strategy? No? you may have a renewable energy component in your strategy because energy costs are important, and managing the technology a make or break capability, but in itself is a part of the larger strategy.

Strategy cannot accommodate disruption.

Disruption has become almost a cliché, an excuse for just about every failure around. Strategy is all about building a framework that will enable sustainable commercial success, and if that is  not about anticipating and leveraging disruption, amongst the other factors that drive long term success, I am not sure what is. The challenge is that disruption has suddenly emerged as the executioners block for those who fail to change at the radically increased rate over that required just a generation ago.  Pick any disruption you like, and you will see elements of it that  were both predictable and within the capability of the legacy businesses to leverage, if they had the foresight and capability to disrupt themselves. Being the big incumbents, arguably they are the best resourced to be the disruptors, but almost never do so. The bigger the ship, the harder it is to change direction. It is not disruption that leads to failure,  but the strategic failure to anticipate, lead, and leverage the disruption that leads to the failure.

 

My antidote to all this is to be continuously discussing and refreshing strategy by having it on the agenda at all times. Ditch the notion that it is set in an annual 3 day gabfest, and make strategic thinking a crucial part of your standard operating procedures throughout the enterprise. Strategic thinking should be on every agenda in an enterprise, and a general responsibility, not one reserved for the few senior managers.

Need some outside assistance, which most do, give me a call.

 

Photo credit: wiki commons.

 

 

What is the value of habit?

What is the value of habit?

Jun 11, 2019 | Customers, Strategy

Yesterday I filled my car with petrol. There are a number of petrol stations near me, but I tend to use the same one, by habit, without any real form of comparative pricing with other stations in the area.

It is convenient, is in a backstreet, the bloke who swipes my card is pleasant, it is an independent, so I just assume the price is OK without checking. None of that stupid discount applied if you have a supermarket loyalty card, where you know the price is inflated to accommodate the discount, a practice I find is as irritating as it is immoral, so avoid them like the plague.

I wonder how many of his customers just use the place habitually, without checking prices as I do?

Consider the implications of pricing on the profitability of the station.

I will not try and do the maths, as I do not know the costs or the volumes involved, but two questions are relevant:

  • How many of the customers are regulars, like me, who do not check prices?
  • At what point do regulars, like me, check prices, weigh up the other factors that influence our behaviour, and move elsewhere?

Would it be worth knowing the answer to these questions, and managing price accordingly?.

At some point, you will lose the price checkers, those who  chase the cheapest price on the day, and seem to be prepared to drive around looking for the cheapest petrol.

How many added cents/litre will motivate a habitual user, like me, to actually check the comparative prices, and move to a less convenient station?

If I was running this petrol station, I might consider putting in a system that in some way recorded the regulars, those who seemed always to use the station, and those who just used it occasionally, and then experiment with the price elasticity of the regulars, assuming that the price checkers will never come in unless you are the cheapest  on the day

An added cent to the price would probably not be noticed by the regulars, not drive any of them away (poor pun there) but would drop straight to the bottom line. If the regulars were 60% of your sales, it might well be a great strategy. It gets rid of the lines at the pump, increases the chances for interaction at the cash register, and that extra sale from the grocery and confectionery lines, which is after all, where a lot of the profit hides. 

Every business, no matter what it is, should consider deeply the drivers of profitability in their business, and pricing strategies should be number one on the list of considerations.