Month: March 2011

This is just the normal process, we should stop being surprised with it

The personal computer in the early 1980’s, email and browsers in the early 1990’s, Linux in the mid 1990’s, SMS and Social Technologies in early 2000’s. All technologies that would “never” be adopted by the enterprise. The alleged reason? “Security”

All those technologies eventually found their way into business and the enterprise.

The real reason the enterprise doesn’t adopt technology? Control. It is natural to try to keep control when you think it is not about people, it is about processes. See, I am not against control. In one of my earlier lives, I developed a Change and Configuration management system for enterprise data centers.

But at some point, people will need to do work and they will use tools that help them to get work done. If the enterprise doesn’t offer those tools, they will bring in the tools they are already using in their personal lives. Skype accounts of 2010 are the AOL email accounts of 1990.

Last night I had a discussion on that with my friend Prem Kumar (@prem_k). We were talking about Skype. I said Skype was been adopted from the bottom-up and that one day we would wake up and realize that everybody is using it (instead of Webex, GoToMeeting, telephone, MS Communicator, etc, etc).

At work, I use Skype all the time. To chat, to talk, to share my desktop. No need to set anything in advance, just connect ad hoc. My brother (a lawyer) uses Skype. My sister-in-law uses Skype. The mother of my sister-in-law, who lives in the deep countryside of Brazil and doesn’t use ATM machines, uses Skype.

Prem and I have a bet. Dinner. My side of the bet is that Skype becomes the quasi-standard real-time communication tool in 3 years.

This is not the first time I make bets like that. I always lose, because the enterprise is slow and change always take longer and eventually Microsoft will create a Skype-client “for the enterprise”.

Yes, IT departments will block Skype the same way the did with email in 1990 and with Twitter in 2010. But my bet is that when customers start demanding Skype communication, sales will have no choice but comply.

But don’t be surprised when you wake up one day sometime in the future and everyone is using Skype. Because you already are and everyone will.

On Tuesday morning, Ray Wang (@rwang0) from the Constellation Research Group posted in Twitter:

Hoping someone will write a post titled, “Is Crowsourcing Just The New Stone Soup?

I first became interested on the subject in the early 90’s in the beginnings of the “Open Source” movement. I got very involved in community development later and, for a couple of years, the maintainer of the official production Linux kernel was a member of my team. How can a young developer single-handedly merge contributions of tens of thousands of people scattered around the world using only basic Internet collaboration tools? I still don’t understand that.

It was natural for Internet software developers to be the first community to leverage the Internet medium to show that a large number of people without central coordination, direct financial compensation, or structured organizational support can tackle very complex problems and reach results that are, if not better, at least comparable to professional organizations.

Since then, many examples beyond GNU/Linux flourished and gained broad commercial application. First in the software domain (databases, web servers, etc), then in media (Wikipedia, News, etc), and we see it now spreading into other areas.

The term “crowdsourcing”was first coined (according to Wikipedia) by Jeff Howe in a June 2006 Wired magazine article “The Rise of Crowdsourcing”. I credit the earlier book “The Wisdom of the Crowds” (2004) by James Surowiecki with the expression of the concept.

The general argument is that, once we have the team collaboration technologies capable of aggregating the collective intelligence of a large group of people, we no longer need to depend on “experts” that dedicate a lifetime to accumulate knowledge about a very narrow domain of knowledge to resolve complex problems.

So is Crowdsourcing applicable to any of the problems we want to solve?

The short answer is no. Don’t assume that just any problem can be solved by unstructured communities. In fact, with our current technology and ability to collaborate, only a small number of very specific problems can be successfully crowdsourced.

For Crowdsourcing to work you need:

• Critical Mass – The knowledge of an expert cannot match the aggregation of knowledge of a crowd of 100,000 people. But it can easily beat a crowd of 10. So if you have 10 customers, don’t expect a customer forum to be able to design your future products without the coordination of a product manager and expert designers. If you are looking for the solution to a horizontal problem that affects a large number of people (e.g. designing a good operating system or database), then it may be a viable alternative.
• Emotional Engagement. In the absence of direct financial incentives, the participants in a crowdsourcing effort will need something that let them overcome the imperfections of communication tools and the friction of collaboration. Having a common cause, or enemy, or ideology, or pursuit of glory, or artistic expression is an important factor in crowdsourcing initiatives.

Thomas Friedman famously declared: “The World is Flat“, meaning that the global marketplace is becoming a level playing field, where all have similar access to information, knowledge and opportunity.

We have been certainly moving in that direction, particularly when it comes to gaining access to knowledge (see article by @fredmcclimans on Commoditization of Knowledge).

What does that mean for us in the Professional Services community?

When pondering questions like that, I find it useful to look at the extremes.

On one hand, an economist once told me, “In a perfect market, we don’t need corporations to structure efforts to solve complex problems. In such scenarios people exchange expertise and skills directly in the open marketplace”. Everyone works under a professional services model (i.e. not a permanent employee of the consumers of services).

On the other hand, when we hire professional services today, it is because a company needs infrequent, technical or unique expertise not available in-house. If knowledge is an easily available commodity, does that mean professional services are going to shift from consulting and advice to execution outsourcing?

The rationale for the theme “Commoditization of Knowledge: What is your product?” is provoking thoughts about the core value of professional service offerings and how that will evolve in the future.

Please join hosts Fred McClimans (@fredmcclimans), Kelly Craft (@krcraft) and Alan Berkson (@berkson0) for the bi-weekly Professional Services Chat (#profserv) thisThursday, Mar 17th at 7PM PST/10 PM EST.

Possible questions we can debate:

Q1 – Is it true that knowledge available through Social Media is becoming a commodity?

Q2 – Is the “expert” value of professional services being diluted?

Q3 – How does professional service adapt to and take advantage of  the increased access to knowledge and expertise offered by digital media?

The funnel is no longer in your CRM database: it moved to Social Media

Adoption of Social Technologies and the shift of the media mix towards Social Media is changing the way we look at the marketing funnel and customer relationships. What used to be a list in our business database system is now a list of brand followers, likers and fans in outside communities. We don’t own or control those contacts, but we need to know their Social-ID and keep track of our conversations with them across all channels.

This post discusses how marketers can deal with that change.

The Marketing Funnel

Classical methods of lead generation are modeled as a “funnel”: among all potential buyers in the market (“suspects”), companies needs to move (or “nurture”) them from awareness (know it exists) to consideration (think of it as viable supplier) to preference (consider it the most adequate) to action (decision to buy) to loyalty (experience value and remain a long-term customer).

In that model, Marketing’s mission is to manage that funnel and deliver sales leads ready for a transactional action with a sales person.

Nurturing the funnel typically consists of periodic message push followed by listening for responses (click-throughs, submission of a web-form, phone call). The implicit reliance on serendipity (hitting “suspects” at the exact time when they  are sensitive to the message and ready to engage in a sales conversation) annoys the audience, but it is really the most efficient method if your media choices are restricted to print, broadcast and e-mail.

The Buying Process has always been social

People buy from people they trust. Buyers need to trust the brand or, at least, the person interacting with them in that “last mile” of the sales process. The majority of purchases are based on recommendation. Buyers tend to buy what their peers recommend.

Two of the promises of Social Media that are relevant to marketers in this context:

• Because the media is participative, it allows direct influence between happy customers and prospects, harnessing the social character of the buying process and let the funnel “self-nurture”. Rather than depending on glossy case studies, the marketer focus on amplifying that peer influence.

• By enabling continuous and less intrusive bi-directional engagement, Social Media allows for less reliance on serendipity. Rather than shoot in every direction and hoping to hit people at the right time, prospects themselves will let you know when they are ready for a sales discussion.

In Social Marketing the goal of the marketing process goes beyond Loyalty. You have reached fully realized relationship with a customer when it becomes a Brand Advocate.

The New Marketing Funnel is in Social Media

The “Funnel” metaphor implies control and tossing suspects that are not ready out of the marketing process, and might no longer be the best way to describe our relationship with potential customers.

In Social Media circles, we talk about “communities”, which includes not only prospective customers, but also existing customers, partners, influencers and even competitors.

Today, you manage you contact lists using spreadsheets or tools provided by some type of CRM system. The Social Marketing Funnel is now the union of contacts in the customer database, and followers, likers and fans in the places where your customers congregate (which may or may not be places you control).

How to manage the Social Marketing Funnel?

The natural impulse is to re-gain control. Build a better CRM database. Build a proprietary online community. Create company-controlled forums.

But the pendulum of control has shifted towards customers and is not swinging back anytime soon. We need to adapt to that new reality.

We need a new generation of tools and technology that can help us to manage our relationship with stakeholders, independent of them being in a venue that is under our control. We need to know their identity (their “Social-ID“) and track the total interaction with them as a company.

• Communication – Learn to listen, communicate more openly and transparently. Adopt a relationship platform that enables you to communicate with the audience across all the available channels.
• Embrace Social – Customers no longer rely on you as the primary source of information about your product or anything else. They will talk to their peers. Focus on amplifying the voice of your happy customers.
• Share Control – Customers control the buying process. You need to be able to track your interactions with them, but influence is mutual. Let them tell you when they are ready.
• Management – Marketers still need to segment, push a message, convert. But those functions don’t necessarily reside in your local system or database. Customers segment themselves by, for example, making their profiles available or using hash tags. Tools and methods you use need to be able to reach outside your systems.

Trust is more important than Control

Are the market stakeholders justified in worrying about Apple’s future success being dependent on the health of its leader Steve Jobs?

Whether or not a company can continue its winning trajectory after the retirement of a strong leader depends on, among other things, whether or not his/her leadership has become organic in the organizational culture.

This post look at leadership in the context of the organizational evolution towards more social business models, when customers, employees and other stakeholders are empowered by information and have more influence in the direction of successful companies.

Classical leadership and its limitations

Leaders use analytical skills to build the strategy hierarchy and can leverage control and power derived from the fact that compensation of employees are directly or indirectly connected with their personal goals. Classical Leadership is about Analysis and Management.

But most of us have experienced this: Breaking complex problems into independent, self-contained smaller tasks is not easy. The stronger the accountability system, the least incentive to collaborate across functional lines. It is easier to reach partial goals and blame other for team failure than to pursue the joint mission and risking not reaching partial metrics.

Classical business execution pursues the efficiency of specialization but ignores creativity and the synergy of collaboration, which makes it inefficient in any activity that requires any more than mechanical execution.

Open Leadership and Organizational Culture

Author Charlene Li wrote that Open Leadership is taking advantage of the upside of giving up control. She argues that, not only giving up control is inevitable (because of the generational and technological changes in progress), but the future of leadership is bright if we can leverage technology and manage that transition well.

The new leader needs to cultivate transparency as a tool and trust as the currency of influence and power. He/She leverages social technologies to have a bi-directional, less hierarchical and segmented conversation with the organization.

Rather than being able to project a vision and a set of goals based on input originating from external research, the leader needs to be able to capture and express the collective intelligence inside the organization.

The vision and market insight for success comes not through the leader to the organization, but through the organization to the person expressing that leadership. New leadership is about Synthesis and Expression.

Has anything has changed?

Of course the components of Command/Control and Trust/Expression have been always present in effective leadership. The fact that new technologies are enabling better real-time collaboration doesn’t change basic principles of business.

But that contrast between Classical and New leadership is useful to move our level of awareness and help us reach a new equilibrium. The pendulum is moving towards reliance on trust, transparency, collaboration and inspiration. There will be less reliance on organizational charts and compensation plans and more on social interaction tools and right-brain inspiration.

The future of Apple

I agree with most who think the success of Apple is a direct result of Steve Jobs leadership. But I don’t think Jobs has created the products out of his genius mind and driven execution by micromanaging everyone. That is not what great leaders do.

Jobs has created an organizational culture that strives for innovation and user experience. His genius is in being able to cultivate and express that culture. That is how, hopefully, it became organic to the organization.

While we all want Jobs to come back, I think Apple has to find someone who can continue to resonate with that culture and express its core values.

Apple will be fine.

“Social” is different, but how to map it into  what I already know?

While thinking of changes as a revolution is useful to create awareness, changes in business typically happen over time. And the basic principles of marketing or any other business discipline don’t get thrown off the window overnight.

If you are in a small or medium-sized B2B company, hear a lot from Social Media experts about the need to “listen” and “engage” and “set a Facebook page”, but very little advice on how to bridge and integrate traditional marketing and social media marketing campaigns, this post is written for you.

This post leverages what you already know about marketing campaigns to help understand how marketing campaigns happen in Social Media as compared to Traditional Media.

Not just another media

The core difference between Social Media and Classical Media is that the latter is uni-directional. Print, radio TV, and e-mail enable inexpensive broadcast of messages to a large audience, but did not offer the channels for customer participation and for audience peer-to-peer interaction.

Social Media, however, can support more engagement between all participants. The media mix is moving towards dynamic web and Social Media. The shift is gradual but, because the new media is fundamentally different, it has effects that go beyond a simple change of channels.

Segmenting to reach you target audience

Before running a marketing campaign, we need to find an effective way to reach our audience.

Traditionally, segmentation is provided by media companies. If I want to target women considering purchases related to wedding planning, I would advertise or run a joint campaign with a vertical publication, say, “New Bride Magazine”.

No change. Social Media knows a lot about the members of the Social Networks it supports. Facebook and Google can help you to segment through targeted advertising or by letting you peek into the demographics or behavioral patters of web users. But the audience also self-segment themselves by congregating around LinkedIn discussion groups, making their personal profiles available, or using Twitter hash tags, for example.

Publishing content and promoting it

Like in traditional marketing, a social campaign usually starts with content “push” from the company. In Social Media, you cannot really “push” so the message is less self-centered and the content must be more open and interesting to the audience to attract attention.

That could be a blog followed by promotion in Twitter, for example. Or a social media advertisement campaign involving a video in YouTube. The goal is to get the audience to react and interact with you. When they do, they let you know of their interest and become part of your Social Marketing Funnel (which moves from your proprietary database to Social Media).

Engaging and Converting

Traditionally, “lead conversion” happened when the “suspect” provided their identity by calling the company, replying to an e-mail, or filling a form on the website. The company interprets that as a license to engage in a sales conversation.

Social Media allows for a more gradual engagement. Users can visit social media properties and “follow”, which implies interest but not necessarily a signal of readiness to buy. A brand advocate might not be a potential source of new business, but might help you to influence many other prospects by recommending your product or service publicly.

Social Marketing needs to be capable and ready to acknowledge and reciprocate those more subtle levels of engagement with market participants.

Nurturing a prospect into a customer

While the monthly e-mail newsletter may still be applicable in some cases, Social Media create new possibilities of soft engagement that can be less intrusive and more sensitive to customer interest.

Customers can follow the company Twitter channel, or comment in the company blog or download a white paper. The nurturing process is less of a monthly pool and more of a continuous engagement.

After a first transaction, the work of marketing was to pursue Customer Loyalty. In the Social Business era, companies need to strive to turn happy customers in Brand Advocates and cultivate the direct channels to let them influence others. Rather than publishing glossy Case Studies, you can directly connect your happy customers to your prospects in much more authentic and transparent interaction.