Yearly Archives: 2010

Collaboration and Co-Creation: Attractive Platforms for Governments and Nonprofit Organizations

Posted on by
Reply

A modicum of cynicism is healthy. So, it doesn’t surprise me one bit when marketing and innovation executives ask whether collaborative innovation is here to stay, or whether it is a mere fad; here today, gone tomorrow. Personally, I don’t like to read tealeaves, but being a betting man, I am putting my money on collaboration and co-creation having a healthy and prosperous decade ahead.

Why? Because whenever a management practice finds applications in non-traditional arenas, it augurs well for its future growth. We are all very familiar with traditional corporate examples of collaboration and co-creation:

  • Unilever co-creating Marmite XO with the brand’s fanatical lovers
  • IBM co-creating action agendas through its Jams technology – like the recently held Service Jam
  • P&G’s engagement of teen girls through beinggirl.com
  • Electrolux’s annual appliance design innovation challenges conducted through Electrolux Design Labs, etc.

However, how often do we come across case studies demonstrating collaboration and co-creation in the government and non-profit sectors? Not too often. Fortunately there are. Two interesting examples follow, one just taking off and the other already generating interesting success stories.

Collaboration and India’s 12th Five-year Plan

Bureaucracies are not known for experimenting with cutting edge thinking. But the Planning Commission of India seems serious about changing that, at least in its sphere of operation. Before the Planning Commission actually starts developing the Plan, it needs to develop what is called an Approach paper, which sets out plan priorities and targets, which subsequently guide resource allocation and later serve as performance measurement benchmarks; an activity typically performed by technocrats, bureaucrats, and politicians.

For the first time however, the Planning Commission is using the platforms of collaboration and co-creation; it is reaching out to the citizens of India to help shape the Plan’s priorities and targets. Indian citizens will get to voice their opinions and ideas before the Planning Commission, concerning the contents of the Approach Paper. The Planning Commission is inviting ideas, comments, and suggestions on important themes and topics that are relevant and cut across several sectors, such as:

  • Innovation and Enterprise – Are we creating enough innovations and enterprise for inclusive and sustainable growth? If not, how can we do so?
  • Governance and Institutions - How do Government or Public Institutions affect us in different sectors? How can we make them work better?
  • Financing the Plan – What are the financial requirements, both public
    and private of achieving our targets? Can we meet them?

Commenting on this collaborative and inclusive process, Deputy Chairman of Planning Commission, Montek Singh Ahluwalia, said a special portal will be available on the Planning Commission’s website where people can drop in their suggestions. “We plan to make the process more inclusive. We invite people to comment and post their approaches on the portal. People’s suggestions will be discussed while finalizing the 12th plan.”

This program is just taking off, so its too early to tell how the citizens, collaborators in this case, will respond. In my book on Collaboration and Co-Creation, I refer to this type of commitment as a Light-level implementation.

I call it Light for several reasons:

  1. The motivation and onus for collaborating lies with the ordinary citizen. Why should they, especially if they have no confidence or trust in the Planning Commission or its intent?
  2. There is no opportunity for the citizens to debate and discuss different points of view. The opportunity for brainstorming can significantly improve the quality of submissions.
  3. Most importantly, there is no transparency once the ideas have been submitted. To a person submitting an idea or ideas, it is not clear who will read what has been submitted, how the idea(s) will be evaluated, and whether or not they will be accepted or rejected. This will undoubtedly affect the motivation to participate.
  4. There are no rewards for participation monetary or psychological. Imagine the missed opportunity here. Even a small newspaper article or mention of winning ideas on TV, with the person’s photo, would cause a huge amount of excitement and commitment.

So, yes, the Planning Commission and the Deputy Chairman need to be applauded for their enlightened thinking. However, much more can be done to transform the inclusiveness into a major creative and innovation force.

The UK Spending Review

Across the Arabian Sea and a continent away, earlier this summer, UK Prime Minister David Cameron kicked off a collaboration and consultation program, Spending Review, focused on ways to reduce government spending. The Prime Minister recognized openly that the biggest challenge UK faces is dealing with huge debts, which means reducing public spending. He also acknowledged that reducing public spending will require innovative and challenging ideas, best developed by those working on the frontline of public services, and not just by his army of economists and policy makers.

Together with Nick Clegg, the Deputy Prime Minister, his office broadcast an appeal to Britain’s public service workers asking them to share their ideas on where to make spending cuts.

A Spending Challenge website was launched to solicit suggestions from Britain’s 6 million public sector workers. The challenge states that “Every single idea will be considered and the best ones taken forward by departments, the Treasury and the Cabinet Office.”  The invitation also described, in detail, the process by which ideas would be evaluated and analyzed. By all accounts the Spending Review was the most collaborative ever with an extended period of engagement over the summer between Government, experts, the public sector and the general public.

Response to the Spending Challenge was, as the Brits would say, bloody damn good! Over 100,000 ideas, including 63,000 from the Public Sector were submitted to shape the way Government works, cut the deficit, and eliminate waste. In addition to inviting suggestions, Ministers traveled the country to hear people’s ideas and opinions first hand. Finally, The Treasury received several thousand pieces of direct correspondence on specific areas of Government policy – such as health, housing and education – that led to several rounds of
productive meetings with experts in these fields.

Ideas dealing with low hanging fruit dealt with issues such as reducing dependence on paper and migrating to digital media for routine communications, resulting in savings of several million British Pounds. Other ideas dug deeper. A few examples follow:

  • reforming the Educational Maintenance Allowance (EMA) grant and child benefit
  • spending money more effectively by introducing a more preventative focus across public services, especially in public health services
  • building closer links across health and social care
  • minimising tax fraud, evasion and avoidance; a potential spending of £900 million to combat tax fraud, avoidance and evasion, could raise an estimated £7billion of extra tax revenue by 2014 (no need to compute an ROI on that).

Various government departments will continue to review ideas to identify and implement those that could help deliver further efficiencies. In the interests of transparency and openness, the UK Govt. intends to publish all of the original suggestions that met their moderation policy as a data set on data.gov.uk.

Nothing light about this implementation, very impressive indeed! In fact, to use another British expression, it is as close as you can get to a Full Monty; it meets all the criteria of the Listen-Engage-Respond framework discussed in my new book.  I am betting that applications are likely to grow around the world, and in the coming decade we should expect to see some of the most engaging and productive applications of collaboration and co-creation in the government, public, and nonprofit sectors.

Co-Creation and the $300 House

Posted on by
Reply

UPDATE: I’ve posted an entry on the $300 House on the Harvard Business Review site: The $300 House: The Co-creation Challenge >>

One of my professors, the late C.K. [Prahalad], used to say that “managers are so preoccupied with operating efficiently that they don’t even think about value in terms of the consumer’s experience.”

Sadly, despite all the brouhaha about customer-centricity, most companies still operate in a highly product-centric manner.   The difference between the two approaches, using C.K.’s words follows:

The traditional company-centric view says: (1) the consumer is outside the domain of the value chain; (2) the enterprise controls where, when, and how value is added in the value chain; (3) value is created in a series of activities controlled by the enterprise before the point of purchase; (4) there is a single point of exchange where value is extracted from the customer for the enterprise.

The consumer-centric view says: (1) the consumer is an integral part of the system for value creation; (2) the consumer can influence where, when, and how value is generated; (3) the consumer need not respect industry boundaries in the search for value; (4) the consumer can compete with companies for value extraction; (5) there are multiple points of exchange where the consumer and the company can co-create value.

All is not dark and bleak of course.  Several countries, cities, companies, and nonprofit oranizations are beginning to take the initiative to collaborate with their customers to co-create value in fields as diverse as healthcare innovations (Norway), improving the quality of life of 50+ year olds (Scotland), Swasthaya Chetna; Hindi for creating health awareness (Hindustan Lever), and Crashing the Super Bowl (Frito-Lay).   

In my new book, I devote an entire chapter to co-creation beyond the business world.  I share case studies of how the new platforms of customer collaboration and co-creation can be applied equally effectively beyond the business world, to drive collaborative innovation efforts in fields such as education, health care, energy, alleviation of poverty, and sustainability. The consumer-centric view is gaining momentum in non-business environments as countries, regions, and cities experiment with collaboration to co-create more promising futures for their people and the environments in which they live.

One example of a project which will be using co-creation at the bottom of the pyramid is the $300 House (disclosure: I’m an advisor).

$300 House for the Poor

The project, which came to life based on the remarkable response to a blog entry in Harvard Business Review, will take into account customer needs in various countries – from Haiti to India and the Philippines.  I don’t expect to see a single house design emerge, but rather a variety of local designs – each designed to meet local needs.

How do you engage the customer at the bottom of the pyramid?  By spending time with them, and understanding their experiences, challenges, and frustrations as they tackle everyday tasks and chores that so many of us take for granted. Or like A.G. Lafley was fond of saying – by doing your laundry in 25 countries! 

Let’s just pause for a moment to acknowledge that your company’s customer of the future may well be at the bottom of the pyramid.  You would be well advised to adopt a customer-centric mindset and develop a system of initiatives to engage her.

Hallmark’s Collaboration and Co-creation Journey: An Interview with Tom Brailsford

Posted on by
1

Thumbnail image for Thumbnail image for Tom B photo.jpgFew companies share an emotional bond with their customers as Hallmark – the 100-year old, Kansas city-based, king of personal expressions – does.  The company is more than just greeting cards and personal expressions, however.  It’s a silent companion that is always present at times of our celebrations, laughter, tears, and sorrows.  We have shared more of our lives with and through Hallmark than we can remember.



For all its pervasiveness, Hallmark operates quietly, almost as if it were shy of the spotlight.  But when it comes to adopting new and emerging management thinking and practices, Hallmark is anything but shy.  It can be very aggressive.  Consider the case of customer communities and collaborative innovation, topics that top today’s management agendas, and which are discussed in my forthcoming book on Collaboration and Co-Creation.  Not many people know that Hallmark is a pioneer in these fields.  It started experimenting with customer communities in the late 1990′s, even before legendary P&G!



Hallmark’s collaborative innovation journey with its customer communities is a classic, stuff that makes for excellent B-School case studies.  What is even more classical is Tom Brailsford’s association with this journey.  He was there on day one, when Hallmark decided to invest in customer communities, and has been with the initiative since then, growing and evolving with it.  This blog features some of Tom’s key experiences and thoughts, as he reflects on his most extraordinary and enriching association with Hallmark’s customer communities.   



Tom, can you give our readers a bird’s eye view of what the customer community landscape looked like in the late ’90s/early 2000′s, when Hallmark decided to invest in proprietary customer communities? 



Happy to.  The Internet is everywhere today.  But at that time the Internet was still relatively new, especially as a consumer phenomenon.  The prevailing wisdom at that time was that you couldn’t meaningfully engage with customers and conduct activities like marketing research on the Internet, for a host of reasons.  In addition, we had pretty heavy skepticism within our own organization.  We were told that people wouldn’t participate.  We were also told that we are an emotion-based business, and that people would find it difficult to share their emotions on the Internet.  So, it was not a very encouraging vista that we were faced with.  Fortunately, I had some visionary leadership to work with and the mandate to embrace and try new things.  So we moved forward into the headwind, and the rest, as the cliché goes, is history!



It’s been a remarkable journey.  You have been associated with the initiative for close to a decade.  What are the 3-5 things that have left a lasting impression on you?



The most remarkable impression I have to say is how much people want and value having a voice within the companies they love and patronize.  And this despite all the hurdles and roadblocks we put in their way like legal agreements, and giving up their intellectual property rights to us.  I have been startled at how honest the people in our communities have been, holding back virtually no aspect of their lives.  I have gained an abiding appreciation of the power of Trust in fostering bonds among customers, and between consumers and Hallmark.  Finally, I have come to truly appreciate the value and importance of passion; passionate people working on something they believe in, which is how we survived the stresses and strains of the early times, and eventually achieved success.



Let’s look forward.  Recently, Hallmark rebranded its communities. Discuss the implications of rebranding, and how you see the communities evolving over the next 3-5 years?



As you can imagine, during our decade plus experience with online customer communities, we have interacted with our customers in a variety of different ways.  Today the communities are an accepted and integral part of the company’s consumer insights platform.  Not surprisingly, the demand to interact with the communities has increased.  The objective of rebranding is to repurpose, clarify, and communicate a different focus; one that moves away from mere validation to exploration and co-creation. We call them Circles of Conversation today, as Hallmark has new needs that involve much closer support for its innovation efforts.  Consequently, we wanted to be more purposeful in our usage, and challenge the boundaries of what can be done using online communities.  Our goal is to reduce open-ended, in-depth explorations and increase social media activity and engagement. We also want to provide more immersion opportunities for our senior executives and company leadership. The dedicated and proprietary customer communities will continue to provide a source of deeper understanding, but social media-based listening and engagement is going to get more interesting and important.



Share one outstanding success story – an outcome that would never have happened if the communities didn’t exist.



This is a tough one for two reasons.  First, we are a private company and I am limited in what I can disclose.  Second, there is seldom any one study, technique, person, or experience that can be singled out as the cause of an outstanding success.  With that in mind, I would say that the biggest contribution our communities have made is change the language we use and the lenses through which we look at consumer behavior.  This has led us to ask traditional questions differently, and ask a whole new set of questions. Without exaggeration, the communities have helped us understand how real people talk about the issues and jobs they are trying to accomplish and have helped us become more consumer focused.  This has influenced everything from marketing to strategy.  I know this isn’t as specific as you may have wanted me to get, but it is the best I can do given the limitations.



Tom, there is a lot of cynicism out there, in terms of what’s in it for the consumer?  What has your experience been in this regard?  Do the consumers also benefit, or is it just Hallmark?



We have asked our members over and over again, “Why are you doing this?” The answer we get repeatedly is, “It is so exciting to know that a company wants to know what we think.”  Some have said, “When I walk into a Hallmark store, I feel happy, because I know that I have made a contribution; there are things in that store that I’ve had a hand in creating and bringing to life.”  Aside from that, they love the “closeness” of the walled community that has a code of conduct, so they feel safe sharing.  They truly do form close relationships and share a lot/everything with one another.  Many lasting friendships have been formed between community members.  The communities fill an important social need for the participating women, and we are grateful to provide them the opportunity.  No, its not just Hallmark that benefits; the consumers benefit as well.  I think that’s the main reason the initiative is still healthy and thriving, ten plus years after inception. 


As the lyrics of a song on Paul Simon’s Graceland album go – who am I to blow against the wind?  Well said, Tom.  Thank you for reflecting, and sharing your thoughts on a very successful journey.  For essentially selfish reasons, it was particularly gratifying to hear Tom speak of the emerging importance of Listening at Hallmark.  The Listen-Engage-Respond framework that forms the core and guts of my Collaboration and Co-Creation book is the new marketing.  The book features the Hallmark case study, and the collaborative innovation journeys of several other companies, individuals, and organizations.

The last several decades have belonged to the shouting-telling-selling brands.  The next several will belong to the listening-engaging-responding brands. 


Collaboration, Co-Creation, and Innovation Jams: An Interview with IBM’s Liam Cleaver

Posted on by
Reply

Liam Cleaver.jpg

Collaborating with customers and other key stakeholders to co-create value is a surging trend and a hot topic at most companies.  It is also the theme of my forthcoming book – Collaboration and Co-Creation: New Platforms for Marketing and Innovation.  

Most readers may be familiar with the well-publicized of examples of co-creation, such as Frito Lay’s creation of Super Bowl commercials, Dell’s involvement with  its customer community, IdeaStorm, to shape product development and customer service strategy, and how Threadless collaborates with customers to create and produce its line of T-shirts.

But what about the non-business world – are these platforms just as relevant in co-creating value in fields like education, promoting green behaviors, and healthcare, as they are in co-creating advertisements and new products?  The answer is yes.  My recent HBR blog discusses how The Clinic of Innovation, at Oslo University Hospital, uses these platforms to nurture and treat innovative ideas.

IBM and its Innovation Jams technology has an extensive track record collaborating with not-for-profit organizations like World Urban Forum, NATO, and USAID on co-creation challenges involving urban poverty, international security, and promoting cooperation with the Muslim world through entrepreneurship and education.  The blog features an interview with Liam Cleaver, one of the principal architects of the Jams platform and its many applications.

Greetings Liam, do you want to kick off the interview by providing a brief primer on the Jams platform; how Jams are conceived and implemented.


Glad to.  An IBM Jam is an on-line collaborative event, often also referred to as crowdsourcing, involving the discussion and exchange of ideas around a specific topic or a set of topics.  The audience is invited to participate in a meaningful and constructive exchange of ideas, thoughts, and opinions.  This exchange takes place over a finite time period, usually a few days.  

We took the name “Jam” from the notion of a jam session. Jazz musicians who are passionate about their music and can sit and create something amazing even if they have never met before. This is the experience we look to create in an IBM Jam, the ability to connect people who might otherwise never meet, and have them share their passion for a topic, and build on each other’s thoughts to create something remarkable. Like all events there is a backstage team helping to make connections and facilitating the exchange of ideas – trained facilitators, Jam Hosts, and experts in semantic data analytics technology from our IBM Research division, called COBRA.

What has been your overall experience with Jams? Positive, very positive, negative? Share a few key case studies to help us understand your answer.

Very positive, indeed!  We have run Jam events with participants from every walk of life. What has always impressed me is the ability of Jams to tap into people’s natural desire to want to make a difference – make a meaningful contribution or have a positive impact on their place of work or where they live. A few examples:

  • The World Urban Forum (WUF) was established by the United Nations to examine rapid urbanization and its impact on cities, economies and policies. Habitat Jam run in 2005 for the World Urban Forum was the largest brainstorming ever on urban sustainability, bringing together NGOs, politicians and academia, and slum dwellers whose lives were directly impacted by this body. Over 8,000 ideas were distilled to 70 core ideas – this core set were all presented at the WUF3 conference and adopted as its official platform.
  • Eli Lilly’s CEO, through VisionJam, engaged over half of their global population to identify practical ideas for how to realise their new strategy and vision resulting in a new framework for the company.
  • More recently, the NATO supported SecurityJam to address 21st Century security threats and CovJam for the City of Coventry in the UK, were truly impressive in terms of the range of ideas generated and quality of interaction.

Liam, in your opinion, what are some key misconceptions and misgivings people have about Jams?

There are a few misgivings.

  • First, I frequently hear that, ‘this approach doesn’t result in tangible outcomes, and it is simply a chat session and no different from how or why people use Facebook or Twitter.’ 
  • The other prevalent view is ‘people will only share their ideas in an anonymous environment.’ Jams are not anonymous by design. A sense of trust is created in the Jam seeing a person’s name associated with their comments, and certainly adds to the level of constructive (if at times critical) debate. 

A typical Jam lasts 72-hours, with people signing on around their busy daily schedules for perhaps 30 minutes, or an hour at a time. They are encouraged to return by the quality of the discussion and by their own desire to push emerging ideas forward.  The audience knows, in advance, that the Jam sponsor is committed to act on the results and outcomes of the discussion, so they are willing to roll-up their sleeves and contribute.  Jams do have the potential to be very fulfilling, as they do lead to follow-up action.  But there is a risk as well, raising the audience’s expectations with no plan for follow-though.

The biggest misconception people have is that Jams are automatic, spontaneous, and require little or no planning.  Nothing could be farther from the truth.  There is nothing spontaneous and automatic about a Jam event.  Without all the investment of time and effort up-front, during, and after, a Jam would be a non-starter and have zero value.  The best Jams are those that have unwavering focus, and unquestioned commitment to follow-through and act on the recommendations.

What would be the best example of such a Jam, one that had unwavering focus and intent from the start, and which resulted in concrete, long-lasting outcomes?

Without a doubt, that would be IBM’s InnovationJam in 2006. Before the Jam launched our Chairman, Sam Palmisano, committed $100 million in funding to ideas that utilized emerging technologies to solve existing business and societal challenges. Over 150,000 people from 104 countries participated during the 72-hour Jam generating over 40k posts that were narrowed down to 30 core ideas. The executive team selected 10 big ideas that represented first-of-a-kind new businesses within IBM; of which, over half represent IBM’s corporate-wide Smarter Planet initiative launched in 2008.  So, it can safely be said, that a significant portion of IBM, namely the Smarter Planet initiatives, came into being as a result of the Jam. 

A change in Culture and Mindset is critical for collaborative innovation to take root and become reality in any company. Does IBM Jam regularly with employees to shape its own culture and mindset? 

IBM has been ‘jamming’ with it employees since 2001. In 2003, we used the Jam solution to reexamine the company’s core values since their inception nearly 100 hundred years earlier. Through ValuesJam, IBMers came together to define the essence of the company. The result was a new set of core values – defined by IBMers for IBMers – that now shape everything we do and every choice we make on behalf of the company and our clients. Over 220,000 employees downloaded the “values manifesto” created as a result of the ValuesJam.


Thank you Liam for your time and views. I know you are bullish on Jams. What issues will challenge Jam experts like you over the next 3-5 years?

Yes, I expect to stay bullish on Jams, and yes, I expect to continue to be challenged.  Several things.

  • First, I expect more companies to use Jams to engage their employees, customers, and other key stakeholders; in my opinion “jamming” with employees is still underutilized.
  • Second, given the volume of data Jams generate, we need continued improvements in data and visual analytics to help make sense of the data in real-time and identify underlying themes, values, and sentiments.
  • Third, why just English, why not jams in other languages as well?
  • Lastly, everyday the connection between the PC and the Internet is weakening, with smart phones and other mobile devices capturing more users and accounting for more usage.  These devices will also need to be part of Jam events in the future

I can relate to Liam’s responses. Thanks to him, I was able to get a firsthand understanding of the nature, power, and limitations of Jams, by participating in the USAID Jam event held earlier this year.  It was truly a valuable learning experience, one that greatly enhanced my appreciation for the Jams innovation platform.

Collaboration and Co-Creation: New Platforms for Marketing and Innovation

Posted on by
Reply

book_medium.gifCome October, Springer will launch my new book, Collaboration and Co-Creation: New Platforms for Marketing and Innovation.  In this blog post, I’d like to briefly introduce the book – what motivated it, its structure, and essence.  I’d also like to take this opportunity to recognize and celebrate my collaborators.

It’s a rare day when some media personality or academic guru doesn’t proclaim – this is not your father/grandfather’s economy!  It isn’t. The reason it isn’t is because the ethos (defining characteristics) of today’s world is different.  Several C’s and a T; connectivity, creativity, collaboration, community, and technology, especially the Internet, best capture the ethos of the world we live, play, and work in.  At the center of this maelstrom lies a new and empowered customer that best exemplifies this ethos in motion.

Companies today are dealing with a new type of customer; one that is more educated, better connected, and infinitely more creative and resourceful than at any time in the past. Today’s customers expect to be heard; they are unwilling to be mere consumers, passive and invisible at the end of a long value chain – instead they want to be collaborators and co-producers of the products and services they consume.  They don’t want to merely watch TV reports on Haiti’s earthquake, they also want to report on it and use their social media skills to mobilize aid.  They don’t want to merely watch the Super Bowl game, they also want to win Frito Lay’s “Crash the Super Bowl Ad Contest” by creating ads for Doritos.  They don’t want to merely moan and groan about Dell’s lousy customer service – been there, done that – they also want to shape Dell’s customer service and product innovation priorities by participating in its IdeaStorm community.   

Consequently, customer collaboration and co-creation is a hot item on the strategic agenda of most companies.  They have been fired up by books like Wikinomics, Here Comes Everybody, Crowdsourcing, We-Think, etc., that applaud and celebrate the rise of the empowered customer.  They hear pundits urging them to rethink the way in which traditional firm-centric activities like marketing and innovation should be implemented to win the empowered customer’s business.

But for most companies the key question is how?  There is little out there to help them migrate from applause to implementation.  What does a company do after it gets all excited and motivated about collaborating with customers?  How does it engage them in re-shaping its marketing and innovation efforts? A few market leaders, like Unilever, IBM, Hallmark, and Audi have figured it out.  But the majority of companies are still huddled at the starting line debating how best to implement collaborative innovation programs.

About the Book

Collaboration and Co-Creation helps bridge this gap.  Using a simple and easy-to-understand framework, Listen-Engage-Respond, and numerous case studies from around the world, the book helps readers shake hands with a core set of thinking and action tools for implementing collaborative innovation programs in their own companies.  It nudges readers to view collaborative innovation as a business process that can be systematically designed and implemented, not as some spontaneous, self-organizing outburst of periodic customer benevolence.  The book was written with a show, don’t tell mindset.   Hence the emphasis on sharing, discussing, and guiding using a variety of business and non-business cases, examples, and stories, so as to make the content eminently readable and interesting.   

Collaboration and Co-creation is a compact eight-chapter book.    

  • Chapters 1 and 2 set the stage.  Using case studies like the creation of the Oxford English Dictionary, birth of mountain biking, open source software, and Hallmark, chapter 1 discusses the evolution and dissemination of collaborative innovation in contemporary businesses.  Chapter 2 presents the Listen-Engage-Respond framework and illustrates it with case studies involving the Phoenix Suns and Unilever’s Marmite.
  • Chapters 3 through 6 provide an elaboration of the Listen-Engage-Respond framework.  They discuss each of the legs of the framework, once again liberally supported with a large number of short (a few paragraphs) and regular (a few pages) case studies.  A few examples being – Barak Obama’s election campaign, International Flavors and Fragrances, Nike, Audi, Blizzard Entertainment, Nokia, P&G, Frito Lay, NASA, Ellen Degeneres, and the Susan G. Komen Race for the Cure.
  • Chapters 7 and 8 aim to end the book on an emotional high.  Chapter 7 discusses the implications of becoming more open and collaborative on traditional firm-centric activities like marketing and innovation.  Supporting examples and case studies drawing on the experience of Unilever, Crayola, IBM, Sun, and Ubuntu are provided to help support the discussion.  Chapter 8 takes the reader on an eclectic journey beyond the business world.  Using examples ranging from the country of Denmark, to a clinic of innovation in Norway, to IBM’s innovation jams, the chapter discusses how the Listen-Engage-Respond framework is just as effective and relevant in co-creating value in the fields of education, healthcare, economic growth, and global welfare, as in co-creating advertising based on UGC (user-generated content).

The book’s Foreword is by Mr. Paul Polman, CEO of Unilever.  Leading business executives and thought leaders from the academic and consulting worlds, like Vijay Govindrajan, Nicolas Mirzayantz, Jacob Buur, Vince Barabba, John Hagel III, and Steve Howe, who had a chance to review the content before it went to print, have provided their insights and frank assessment of the book’s framework and ability to foster customer-centric transformation.  We hope you will find it just as useful in leading customer-centric transformations in your own companies.

Collaborators

deanna web.jpg

Writing a book is seldom a solo endeavor; it is always a team event.  Collaboration and Co-creation is no exception.  I would like to acknowledge and celebrate Deanna Lawrence and Gabriela Head’s valuable contributions to researching the myriads of cases and examples that breathe life into the book’s content and their participation in triggering and writing various chapter drafts.  

Thumbnail image for Gabriela 2009.jpg

This collaboration has a very compelling underlying story that deserves to be shared.  Deanna lives in Michigan, Gabriela in Arizona, and I in Virginia.  I have known and worked with Deanna for several years, so working remotely with her was not a big deal.  But till today, one book and hundreds of calls later, I have yet to meet Gabriela.  And barring a two-hour meeting over a cup of coffee while in Arizona to attend a wedding, well after approximately 70% of the book was written, neither does Deanna have any previous history of working with Gabriela.  Needless to add, we are working hard to synchronize intent and calendars so we can all be in one place and toast the launch of the book in October.     

As the famous line in the classic short story – Face on the Wall – states, truth is not only stranger than fiction, but also greatly more interesting.  Yes, it is true, honest and productive work relationships can flourish, despite time and distance barriers.  They merely need a steady and constant infusion of trust and commitment.  Make no mistake, though, it is difficult, but infinitely rewarding.  I was not surprised at all therefore to learn that the latest “Richard Beckhard Memorial Prize” for the best article published in 2008-2009 was awarded by the editors of Sloan Management Review to the article  – How to Manage Virtual Teams.  Folks, if anyone is looking to do more research on this subject and needs first hand experiential data, please talk to us.  We will be happy to tell all!

In the coming weeks, I intend to feature interviews with companies and individuals who shared their stories with us and also provide more details on selected aspects of the book.  Stay tuned!

Marketing Myopia and Other Ted Levitt Classics: Paying Homage To A Prodigious Thinker

Posted on by
Reply

TedLevitt.jpg

Recently, I was in Hyderabad, India, teaching a course on Customer-Focused Marketing Strategy at the Indian School of Business.  As a pre-reading for the course, I recommended Ted Levitt’s classic article Marketing Myopia – classics do have their place, even in an age of bulimic sound bytes! 

Even though I have read Marketing Myopia several times, I favored discretion over valor and decided to read it one more time, just in case somebody was hell bent on peppering me with tough questions. 

Reading the article again was more than just a born again experience.  It was a lesson in humility.  Here was an article, first written in 1960, that had nailed several things we are still wrestling with today.  Little wonder that the late Ted Levitt is regarded as one of the most widely respected thinkers in the field of marketing and management. His work and writings have changed the way companies think about their businesses, organize for innovation and creativity, and market their products and services. 

A homage to some of Ted Levitt’s best thinking follows:


Marketing Myopia


The article that gave rise to the famous aphorism – “Customers don’t buy 1/4″ drills, they buy 1/4″ holes.”  It still provokes serious thinking.  The big idea – get companies to think of their businesses in terms of customers needs, not in terms of the physical products and services they produce.  Levitt asserted that all companies and industries were once growth industries.  If they have stopped growing it is not because markets are saturated, but because management failed to correctly grasp what business the company was in.  Invariably, companies that run into growth problems suffer from one overarching weakness; they are overly focused on physical products and services – credit cards, cell phones, mortgages, HDTV – and less on customers and their needs.

After the Sale is Over  – - -

Long before there was CRM and Relationship Marketing, Ted Levitt was discussing the importance of cultivating relationships with customers.  The big idea – a sale signals the end of courtship and the beginning of a marriage with the customer.  The quality of the marriage determines whether there will be continued or expanded business, or troubles and divorce.  Levitt considered relationships with customers as an asset.  The more complex the product and service, the more salient the customers’ needs, the more critical and valuable is this asset.  He advised companies to manage and continually invest in this asset, since over time relationships would trump all other aspects of the marketing system, including technology. 

Marketing Success Through Differentiation – of Anything

The big idea – every company should resist the push towards becoming a commodity, by attempting to differentiate not only their products and services, but by differentiating their whole business, in terms of what they offer and how they operate.  What we call reinventing business models today.    To elaborate, the basics of checking and savings accounts at Citi, Bank of America, Chase, and HSBC may be identical, but how these banks do business and the resultant customer experience may be wholly different/differentiated, and hence a non-commodity.

Moral of the story – knowing the catch phrases from the most recent NY Times best seller list may get you attention at cocktail parties.  But knowing the essence of classical marketing and business writings will get you the promotion you desire and significantly add to your bank balance!  Not a bad thing in any age, especially in today’s recessionary times.

Institutional vs. Individual Collaboration in Times of Crisis

Posted on by
Reply

luft.jpgLast month’s volcanic ash cloud over Europe disrupted air-traffic and cost the airline industry over £1bn.  But the ash cloud also revealed the serious absence of collaboration between the various European air traffic authorities.  Apparently there are 27 different air spaces across the EU, each one with its own authority and bureaucracy.

Europe's planned Functional Airspace Blocks

The BBC reports:
“There has been widespread criticism of the EU’s response, with Euro MPs
and airline officials complaining that the Commission and transport
ministers did not hold emergency talks until 19 April.”

That’s five days after planes stopped flying. What were they waiting for? An “all-clear” signal to fly to their meeting?

In times of crisis, it seems like collaboration between governments and institutions breaks down.

Lest we think that this is sort of thing doesn’t happen here in the US, one only has to look at two more examples: Katrina, and the BP oil-spill in the Gulf of Mexico.

So what is it about large institutions that makes collaboration so difficult, if not downright impossible in times of crisis?

Here are seven possibilities:

- Lack of a Shared Vision

- Absence of Trust

- Institutional Blindness

- Territorial Turf Wars

- Lack of Leadership

- Insensitivity to Customers’ Needs

- Culture of Unaccountability

And that’s just the tip of the iceberg.

Among individuals, however, we see something else entirely. 

In times of crisis, passionate individuals can come together to collaborate in ways that defy the norms of business and institutional performance.

tpop.gifIn their latest book, The Power of Pull, John Hagel, JSB, and Lang Davison describe Joi Ito‘s successful effort in distributing a script to post messages to Twitter that would make it virtually impossible for the Iranian government to monitor and stop the service during the green revolution (which we all hope is still alive). 

Overnight, Ito assembled a loosely knit team of collaborators who got created a distribution process which also could not be traced.  This is a remarkable example of how passionate individuals can come together in times of crisis and make a real impact in a space of hours.

Our institutions can’t seem to do anything resembling this sort of collaboration – particularly when the answers lie outside the institution.

Back to the European air-traffic story.

Here’s something else we learn from the BBC:

In addition to avoiding the kind of mix-up we saw last month, a more efficient air
traffic system could cut emissions by up to 12% for the average flight.

We learn that, on average, planes fly 49km (30.4 miles) longer than strictly necessary, and airport slots are allocated
independently of flight plans, causing extra costs and waste.

This is the cost of not collaborating.

C.K. Prahalad Has Passed On: A Deep Loss

Posted on by
Reply

CKPBU.jpgProf. C.K. Prahalad, Paul and Ruth McCracken Distinguished University Professor of Strategy, at the Ross School of Business, University of Michigan has passed on.  Our thoughts and prayers are with his family, as we wish his soul a peaceful onward journey.

He was a globally renowned and recognized scholar, teacher, consultant, and thinker.  I knew C.K. Prahalad, before he became C.K. Prahalad, the Business Guru.  We had the good fortune of having him as our Business Policy professor at the Indian Institute of Management, Ahmedabad, in 1975.  Even in the short span of a single trimester, it was clear that Prof. Prahalad was destined for greatness.  The crispness of this thinking and his lucid explanations continue to inspire and live in my mind after all these years.

The global business community has hailed and celebrated several of Prof. Prahalad’s ideas.  For me, two stand apart from the rest.  His work with Gary Hamel on Competing for the Future and his writings on The Fortune at the Bottom of the Pyramid.  I will be reading them again, to inspire myself, and to pay homage to C.K. Prahalad’s memory.

What they undertook to do

They brought to pass;

All things hang like a drop of dew

Upon a blade of grass.   

W.B. Yeats‘ personal thank you note to the great teachers through the ages.

Rethinking The Purpose of Modern Business

Posted on by
2

In Rethinking
Marketing: From Marketing Products to Cultivating Customers my
co-authors and I wrote about how companies must make products and
brands subservient to long-term customer relationships.  We also
made the point that for ongoing customer value innovation to become a
part of the DNA of the organization, it is important that the company
move from an internally focused concept of customer value creation, to a
more open, collaborative model of co-creating value with customers and
other key stakeholders.

In much the same way, I’m more convinced
than ever that we must rethink the purpose of modern businesses. 
As the global financial crisis has so bluntly shown us, “maximizing
shareholder value” is no longer a sustainable purpose for business. 
We doubt it ever was.  But back then, Jack Welch was preaching the
gospel and companies were lapping it up.  Interestingly, even Jack
Welch is no longer singing the “maximize shareholder value”
song. 

This is the age of consumer
capitalism and the triple
bottom line.  The new gospel is people, planet, and then profits.
 Near term thinking that just does good for the company without
consideration for the environment, or the social social systems that a
company operates in, is not a responsible option!    

So where
should we look for new role models? 

Across the border to
the north, and across the Atlantic to the sub-continent.

rtata.jpg 

Recently I read an article describing
Ratan Tata’s visit to Canada to deliver the first Thomas Bata
Lecture on Responsible Capitalism.

The late Thomas Bata and
Ratan Tata,
and their corporations have a lot in common.  They epitomize socially-conscious
leadership. 

The Tata story has been well covered in this article,
which sums up the vision as follows:

Since its
founding in 1868, Tata has operated on the premise that a company
thrives on social capital (the value created from investing in good
community and human relationships) in the same way that it relies on
hard assets for sustainable growth. With every generation, Tata’s
executives and managers say, they have nurtured and improved their
capability for “stakeholder management”: basing investments and
operating decisions on the needs and interests of all who will be
affected. For Tata, this means shareholders, employees, customers, and
the people of the countries where Tata operates — historically India,
but potentially anywhere.

These are not platitudes.
Tata has won the goodwill
of the people not by talk, but through action. Key decisions are
based on the impact on society.  The company’s humanitarian actions, for
both employees and non-employees, following the dastardly November 2008
terrorist attacks on the Taj hotel are well documented, and have won
raging applause from even the most anodized critics of business. 

People first, business second.  Both Bata and Tata teach us that
it is possible to be a global powerhouse without sacrificing one’s soul.
 It is not necessary to separate social good from business well being,
as so many companies do.

Dartmouth’s Professor Vijay Govindarajan explains the Tata Nano as a social innovation:

Through his actions in the Tata Nano project, Ratan Tata has
demonstrated that capitalism can have a soul–the profit mission and the
social mission do not conflict and can, in fact, be pursued
simultaneously. 

Increasingly, we are going to see businesses doing well by doing
good, a philosophy that guides thinking and decision making at Unilever. In a
recent discussion, Harish Manwani – President Asia, Africa,
Eastern and Central European Regions at Unilever – shared that for
Unilever value co-creation was not just collaborating with customers,
it is collaborating with the interlinked ecosystems that the company
operates in.  According to him, this passion and commitment to doing
well by doing good, is the reason why the Dow Jones Sustainability
Index has rated Unilever as the best company in its category for ten
years running. I intend featuring more of the Unilever social
responsibility story in my forthcoming blogs.

Social good and company well being can co-exist, as the examples of
Bata, Tata, and Unilever demonstrate.  They should not be divorced from
each other any longer. The people and the social systems they live in
are both customers of the company.  The paramount purpose of modern
businesses should be more than just “Do No Harm.”  Rather it must
be “Do Long Term Good for All.”

Leading Companies: The India Way

Posted on by
Reply

India’s economy and its companies have been getting a lot of attention in the past decade.  A trend map of India at the annual Davos conference will attest to this.  A decade ago, India was invisible at Davos.  Today, to the uninformed observer, Davos may well be a Bollywood party.    

indiaway.gif

The Tata Group, Mittal, Reliance, Infosys, Hindustan Computers Limited, Ranbaxy, ICICI, Hero-Honda, and Bharati Airtel are a few Indian companies that regularly garner media headlines.  The world knows a lot about these companies, and their products.  But what does the world know about the leadership of these companies?  The answer is very little.  Beyond a few names, like Naryan Murthy, Ratan Tata, Mukesh Ambani, and Laxmi Mittal, the West knows little about how Indian companies are managed.  The India Way, authored by Peter Capelli, Harbir Singh, Jitendra V. Singh, and Michael Useem intends to rectify that.  

Do Indian companies have their own way of managing and running their companies?  The answer is a most emphatic YES!  Instead of using management ideas and practices that dominate Western businesses, Indian companies are applying fresh practices of their own, to shape their strategy, leadership, talent, and organizational culture.

Here is a sampling:

  • The best Indian companies drive their performance by investing in people; motivating them, empowering them, and investing in their training
  • For them, the CEO’s office and function is not as critical as in the West.  Many of these companies don’t even have that title, and practice group decision-making at the top
  • Envisioning a path to the future, strategic thinking, and guiding change is very critical to the leadership of these companies
  • As is being inspirational, accountable, and entrepreneurial

 

Corporate Social Responsibility (CSR), is not an occasional, negotiable activity for most Indian companies.  Partly because most organizations in India tend to be surrounded by mass poverty, and partly because CSR is a reputational asset that helps negotiate deals with the government, companies are very serious about their obligations to the ecosystem they operate in.  40% of all Indian companies routinely monitor their progress on CSR goals, compared to just 17% in the U.S.  

Are these practices transferable to the West?  That all depends on the priorities of Western companies.  Consider the top priorities of Indian companies:

  • Looking beyond stockholders’ interests to public mission and national purpose
  • Drawing on improvisation, adaptation, and resilience to overcome endless hurdles
  • Identifying products and services of compelling value to customers
  • Investing in talent and building a stirring culture. 

Perhaps the experience of dealing with obstructionist bureaucracies, crumbling and antiquated infrastructure, and growing up in hardship and scarcity can’t be replicated.  But inspiration to do well by one’s employees, and build lasting legacies, around entrepreneurship and long-term success, can certainly be imported, and emulated.   

There’s always been an India Way.  Its just that its more palpable today.  Hunger can be a beautiful thing – especially the hunger of challenger companies not to be perceived as mere Xerox copies of front line Fortune 500 companies.  Let’s hope, for their own sake, Indian companies don’t forget this.  

The old adage – Fat Dogs Don’t Fetch – applies to all companies in all countries!