Naughties, teenies and millennials

When someone says “in the roaring 1920′s” we can immediately relate to the era of speakeasies, dancing the Charleston and silent movies. My question is though: what was the decade before that called? I ask because we will soon be at the end of the same decade in this century and it needs a label. Not just “roaring” moniker for the decade of 9/11, 7/7, Iraq, Afghanistan, Wall Street crash, Saville Report, Bhutto and the thousands of other events that have shaped this decade but what do we call the decade of 1901 to 1910 and 2001 to 2010? In the absence of anyone stepping up I’ve picked “naught-ies”. I tried the “oughts” and “zeroes” but they didn’t seem right to me.

And what has been happening quietly in the “naughties”? In September 2000 a generation of young people entered their secondary education: that same group graduated from university this spring. In 2003 MySpace entered their world, 2004 Facebook, 2005 Bebo, 2006 Twitter, iPhone 2007: this generation of young people, the “millennials”, have integrated into the fabric of their world a digital 7 by 24 experience that extends their presence across the globe and connects them to everything in real-time. For them this is not magic, not technology, not new, it is not even cool any more: it just is. It just is what it has always been for them.

These young entrepreneurs, scientists, engineers, farmers, doctors, artists, philosophers, teachers, athletes, politicians, designers, technologists, historians, geographers fundamentally see the world as an integrated whole free from borders and restrictions. They expect to be able to answer any question in seconds from the palm of their hands. They don’t need to know anything: they just need to Google. They expect things to work together, they expect technology to be free, they adopt technology easily, they are not loyal to any brand, they are socially responsible, they get the work/life balance and they play World of Warcraft every week with their friends.

And they are your new labour-force. They do not see you are their employer: they see you as their collaborator. They are working for you to find an outlet for their creativity, a place where they can problem solve, somewhere they can express themselves and be innovative. They do not accept anything as a fundamental rule, all rules are meant to be tested and then bent, twisted and even broken if it means doing something better. They fail frequently and they enjoy failing for the lessons it teaches. They learn fast and adopt the latest ideas and technologies even though they know they are not always ready and reliable. Speed is essential to them, documentation is not. Delivering something that works for most people quick is better than delivering a perfect solution months from now. They’d rather be late delivering something cool rather than something business-like and on time. They do not settle for good enough: they want to delight. They love change. They revel in challenges.

So how do you exploit them? You embrace them. You create a culture that allows people to do lots of “R” in search of the “D” in R&D. You encourage them to experiment and if they fail you congratulate them on eliminating one more bad idea and encourage them to learn from the experience and try again. You make it clear that it is OK to challenge long held beliefs and you make it clear that you reserve the right to make the final decisions. You learn to say “OK let’s try that” and never say “That won’t work because …”.

As we move into the next decade, which I’ve dubbed to the “teenies”, the millennial labour-force is ready to change everything in your business. Are you ready allow them to take you to the next level and start Empowering Change in them?

July 23, 2010 at 8:32 pm | Business and Technology | 1 comment

Observe, Orient, Decide, Act

Colonel John Boyd, USAF, left us with two interesting legacies. He was the most successful combat pilot in history and yet never shot anyone down. And he developed the OODA Loop theory for air-to-air combat which fundamentally describes how modern businesses must survive.

Known as “40 second Boyd” because he could shoot down any opponent in under 40 seconds when starting from a tactically disadvantaged position. He learned his skills by watching hundreds of hours of film from the gun-cameras mounted in Korean war era MiGs and F-86 Sabres. He created the OODA loop as a tactical approach to winning air battles based on the idea that the pilot that reacted fastest, indeed the pilot that continued to react the fastest, would always win.

The OODA loop, observe, orient, decide, and act, says that combat, and sport, and business requires that we are constantly trying to take advantage of the ever changing situation before the opponent does.

• Observe: use your senses and systems to collect data
• Orient: analyze the data and form an opinion
• Decide: what to do based on your opinion
• Act: and implement your plan

And then do it all again, and again. As you act you immediately change the situation so now you must observe, orient, decide and act on the new circumstances. What this means is that while your competitor is reacting to your changed tactics you are already planning and executing your next one, and the one after that. Maintaining this continual OODA cadence is very difficult but it is the key difference between companies that compete successfully and win markets and those that merely compete.

Following an OODA approach to competing demands that you have the senses and the systems to collect the data you need to make the right business decisions. You started your business because your gut told you that this would be a profitable, fun and worthwhile enterprise. Do not ignore your gut: it got you where you are and you need to keep checking in with it. However the speed of business demands that we have empirical data to support our instincts. Just as we know we are driving at 30 mph because our senses tell us we still check the speedometer when we see a police car to be sure. In the same way when we run our business we instinctively know what we need to do but when a competitive threat looms we need data to tell us what the effect the threat is having and what effect our response is making.

When we look at the computer systems we invest in for our business we, invariably, focus on systems to run the business. I want to encourage you to think about this: how many speeding tickets would you get if you didn’t have a speedometer and relied soley on your instinct for speed? Have you ever speeded up to 30 mph when you pass a police car? I didn’t think so.

A business priority must be to put in place mechanisms to report on Key Performance Indicators (KPI’s) that give you immediate feedback on how your business is faring. And we are not talking about feedback once a year from the auditor or once a month from the bookkeeper but feedback at least once a day that shows you exactly where you stand. For example you might have a DSO (Days Sales Outstanding – the average number of days before you are paid) of 30. If you could see that on a daily basis you could tell if it is drifting to 35, 45, 60 and do something about it rather than find yourself in a cash-flow crunch. And while you are stepping up your collection process, getting the money you need to advertise and invest, your competitors are still oblivious to the fact that their customers are becoming tardy payers.

So as you think about what you need for your business consider that real-time insight to how the business is performing may be just as important as a new fork-lift or a new lathe or new premises. And may be more so. Data is the essential ingredient to Empowering Change.

July 16, 2010 at 10:49 am | Business and Technology | No comment

Working in the margin

For more than six decades now we have been using technology, specifically computer-based technology, to drive costs out of the business. Quaint hardly describes those now sepia pictures of serried hoards of clerks, stamping, signing and sorting multi-part documents in vast open-plan offices. Typewriters on every desk but phones only on the manager’s. And over the last 60 years we have slowly replaced those jobs with technology solutions and those people have moved their skills into different fields. Maybe you are one of them.

Today there is not much automation that is left to be done. Indeed most people in the computer business spend their time trying to replace the systems they put in 10 or 20 years ago  and we are even replacing systems we put in only one or two years ago. And we are doing this now because we are desperately trying to drive cost out of IT.

With the way the economy has been for the past 10 years everyone is completely focused on cost containment.

But that is not the only way to keep increasing the margins in your business. Mr. Micawber once reflected; “Annual income £20, annual expenditure £19 19s 6d, result happiness. Annual income £20, annual expenditure £20 0s 6d, result misery.” Profit is the difference between income and expenditure. We have already driven out all the significant and unnecessary expenditure we can: the pips are squeaking, there is no more juice in the lemon!

Businesses that can turn technology to their commercial advantage will be the Glaxo’s, the BP’s, the British Airways, the Sainsbury’s of the future. It used to be, in 1935, that if you made it to the Fortune list of top companies you’d be on that list for 90 years. Today companies on the list last only 15 years there on average.

Look at FaceBook, Microsoft bought by a 1.5% stake for $250mn, or Amazon, worth over $50bn, these are companies that could not exist without technology to create markets,  create products and deliver revenues.

So what does this mean for your business? Look to turn technology into a way of creating new revenue.

Maybe you can deliver your product and services to your customers through technology that gets it there faster, cheaper, safer. Do kids want to go shopping in the High Street? No, they want to surf the web, from their iPhone and get a package on their doorstep the next day. And kids have a lot of money these days.

Can technology help you understand your customers better? Help you with detecting trends, buying behavior? Can technology help you discover why customers don’t buy from you? Or why they start to buy and then stop.

Is the customer experience with your company better because of technology or worse? What can you do to make your customers become your best sales team because your technology makes them love doing business with you? What can you do to make your competitors look un-cool, out of date, not in tune with the customer?

If you have an idea for changing your business model does your technology allow you make those changes? Or does it hold back and force you to do things the old way? Can you model what effect your ideas might have if you implement them? Or do you have jump and hope?

How do you know that you are being successful? Does your technology tell you, give you feedback on how you are running your business? Does your technology monitor your competitors?

There are as many ways of turning technology into a competitive advantage as there are business people with ideas.

In this series of postings I want to explore ideas on how we start to use technology to drive sales, how we enable business owners to run their businesses proactively and how we Empower Change that increases the margins in your business.

Tell me how you turn technology into a competitive advantage.

July 9, 2010 at 11:47 pm | Business and Technology | 5 comments