Story-Telling: What Every Good Marketer Knows…

Posted on May 13, 2008
Filed Under Gregg Gallagher, Marketing | Leave a Comment

Seth Godin has reposted a list of insights and best marketing practices on his blog. I suggest you read (and save) his entire post as it is a manifesto on what 21st Century marketing should be.

Four of his points relate to the importance of story-telling in marketing:

Beyond’s Seth’s own observations, there is an emerging awareness within the business community of the power that story-telling holds in effective communications. Two books on this subject which I can highly recommend are The Story Factor by Annette Simmons and The Elements of Persuasion by Richard Maxwell and Robert Dickman.

At Quantum Leaders, we ascribe to the notion that story-telling is a powerful vehicle for not only effective communications, ethical persuasion and influence; but also as a means of shaping and realizing the meaningful purpose of the 21st Century organization.

Have you given thought as to what the story of your own organization is? Not just it’s past and present, but more importantly, its’ future? Have you communicated that story to your people? To your customers?

Marketing ROI?….Picking Up The Gauntlet

Posted on April 22, 2008
Filed Under Gregg Gallagher, Leadership, Management, Marketing | Leave a Comment

In his last post on The Challenge of Investing in People, Norm likened the current skepticism of many business leaders re “people investment” to that of the view of marketing 20+ years ago. He went on to state:

And still today no one has yet come up with a way of tying marketing dollars into actual growth in revenues. There are a lot of attempts at proxy metrics (number of placements times expected impressions per placement yields so many leads generated, etc). But I have not met a CEO of late that does not recognize the need to invest in marketing, even though they cannot determine the return on their investment in any other fashion that anecdotal (perhaps that will change with Web 2.0 but we will see).

While I agree that there are still remaining challenges in effectively tracking & tying specific revenue increases to specific marketing programs in many contexts (e.g., print advertising in a B-to-B environment with long sales cycles), I do believe that the marketing discipline is getting much more adept at tracking results, both within the context of the web (via enabling tracking technologies and the ability to complete the purchase within the e-commerce context) as well as via more traditional vehicles such as print and broadcast advertising.

All too often, in my experience, the lack of establishing even rudimentary measures of ROI on marketing expenditures stems not so much from structural limitations as it does from the inertia and sometimes outright resistance of the marketing professionals involved. Marketing programs that can track and report such metrics are often more complex, time-consuming and costly to design, implement and manage. Since very few marketing executives have the luxury of a surplus of resources (people and $s), the natural inclination is for them to squeeze one more ad placement or trade show event into the plan in lieu of implementing ROI tracking mechanisms.

Another dynamic is the resistance of many marketing professionals - particularly in small to medium-sized firms - to allow such transparency into their efforts. We (after all, I am a marketeer) have had a tendency to obfuscate and try to romanticize our profession, positioning it more as an art, than the science it actually can be. Measurement also means accountability, and although we might be loathe to admit it, there is a natural human reluctance to be held accountable (often exacerbated by the tactics of some managers to use “accountability” as a means of manipulation and punishment, rather than as the motivational and learning tool it should be.)

So, when an executive hears from her marketing lead that he can’t measure ROI on marketing dollars, she can and should push back. At the very least, proxy metrics and objectives should be defined, agreed upon and tracked.

Don’t take “We can’t know” for an answer…..

The Challenge of Investing in People

Posted on April 6, 2008
Filed Under Governance, Leadership, Management, Norman Wolfe, Organization & Culture, Strategy Execution | Leave a Comment

Have you ever heard a board member, or perhaps even a CEO say, “The Company sure invests a lot in trainings, meetings, and “feel good” stuff, and I wonder if more of those resources and energy went into focus on results whether we would be better off?”  When we ask the CEO to focus on results, which I firmly believe is what the board should hold the CEO accountable for, we have to understand what the drivers to producing results are.  

 In every business, at the end of the day it is the people who produce results (I have yet to see a machine or a process produce anything without people).   While it is easy to see expenditures in the “feel good stuff” as wasting resources, the real challenge lies in the difficulty to determine if the investment will produce the result.   The proof is in the results, but how do I know that my investments will in the end improve results.

  No one will argue that making an investment to improve the organization’s ability to perform better is wasting valuable corporate resources.  In fact most will argue that if you don’t invest for improved performance you are not doing your job as CEO. 

 In the “machine” aspect of an organization it is relatively easy to determine the value of the investment.  When I install a new piece of equipment, upgrade a piece of equipment or do maintenance work on a piece of equipment, I can see the results of the investment pretty quickly and very concretely.  So both from an observational framework and a time frame I can “measure” my success very easily.  The same can be said for re-engineering a process, there are fairly concrete observational data in a time frame within which I can correlate results to investment.

  When I am dealing with the “organic” aspect of an organization, human development, there is a lag time between investment and results.  And this is the real issue.  It is because we cannot see the results in a definitive pattern from investment to results that we easily question the value of the investment.  And the lag time is a function of the type of investment.  Some skill development is visible and measurable (teaching someone to type) and even the time frame for translation into results can be determined relatively easily using benchmark data (I expect someone to improve form 40 WPM to 80WPM within 3 months).

  But what about development issues that are much less tangible, like investments in gaining alignment and commitment.  These are extremely difficult to determine the impact of the investment, not only because of the lag time but also because of the multitude of variables that can impact success of the investment.

To make the point another way let’s take a look at an investment in hiring a business development person one of our CEO clients recently experienced.   It took a couple of years for the new business development person to start producing payback for his time “schmoozing with the brass”.  And now a good portion of their current growth is directly attributable to this investment.  Yet there were many people, including some on the board and the executive team, who was pressing the CEO to save the expenses and cut the position since this person wasn’t brining in any current period revenue.

  I often look at the challenge we are facing of “investing in people” as the same challenge that investing in marketing underwent 20 - 30 years ago.  I often heard back then that investing in marketing was wasting valuable resources for we can’t really tell the return on our marketing dollars.  And still today no one has yet come up with a way of tying marketing dollars into actual growth in revenues.  There are a lot of attempts at proxy metrics (number of placements times expected impressions per placement yields so many leads generated, etc).  But I have not met a CEO of late that does not recognize the need to invest in marketing, even though they cannot determine the return on their investment in any other fashion that anecdotal (perhaps that will change with Web 2.0 but we will see).

  What has changed over the years regarding marketing investments is that the mindset of the CEO and the executive team which has come to appreciate the value of marketing, and that resources must be devoted to it.  And though I still have yet to hear a CEO say they can concretely determine the return on their marketing expenditure, they readily make the investments.

  And like marketing, people development activity has gained much from years of studying and research around this very question.  And though there isn’t, and I dare say likely will never be, a concrete set of metrics, there are best practices on what are effective investments in people development is and what is wasting dollars.

  I think the challenge for boards, CEOs and their executive teams is to not summarily dismiss these investments as wasted expenditures but to begin to learn what is effective investment and what is wasting corporate resources and how will we know the difference in the context of their company.  Norman WolfePresident/CEOQuantum Leaders, Inc 

Big Teams - Barriers to Innovation?

Posted on March 25, 2008
Filed Under Gregg Gallagher, Innovation, Organization & Culture, Uncategorized | Leave a Comment

In his recent post “Is Design a Team Sports?”, Idris Mootee discusses the role of the individual designer versus a design team. During that discussion he broaches the question as to whether large teams are barriers to innovation. I think that there is a semantic trap in the question, becuase it potentially blurs the distinction between ideation, invention and innovation. Mootee and others often confine their definitions of innovation to the contexts of ideation and invention, which is often best pursued in a solitary - or at best, a small team - context. (e.g., how many great symphonies were written by committee?) An alternative definition of innovation which I prefer to use is that Innovation is the creation of customer value via invention (where invention is the instantiation of an idea or concept.)

In this conceptual framework, the instantiation/implementation of the idea via invention can require a large group effort, as well as the realization of customer value by implementing the operational and logistical infrastructures required to deliver a product or service to customers.

I don’t think it’s axiomatic that large teams are always barriers to innovation. Rather it’s in what contexts is teaming (large or small) optimal, and where is it potentially a barrier.

What have been your experiences with teams (large and small) as it relates to the innovation process?

Is Stage-Gate a Barrier to Innovation?

Posted on March 17, 2008
Filed Under Gregg Gallagher, Innovation, Strategy | 1 Comment

 In a recent, thought-provoking posting on his excellent Innovation Playground blog, Idris Mootee posits that the traditional product development stage-gate framework is a barrier to innovation.

The following is my comment posted to his blog:

Idris:

When I first read the title of this post, the “old school product manager” in me reacted viscerally. Then when I read through the post itself, I came to the realization that our thinking was, in fact, in alignment.

Stage-gate by itself does not promote the ideation/invention aspects of innovation. Where it can play a role is in the implementation aspects of innovation. (In my framework, innovation stems from creativity/ideation that is instantiated via invention and that creates customer value.)

Mere invention which does not create real customer value via implementation is not innovation.

As you noted, stage-gate typically does not do well in contexts that are forward-looking (market-driving) as compared to extrapolating from past experience (market-driven).
However, I do believe that stage-gate can and should incorporate the service design component by defining the appropriate design frameworks and methodologies into the appropriate stages.

However, where stage-gate does not fare well by itself is in the connection to the overall strategy of the organization. It is here where a robust and flexible opportunity portfolio management framework needs to be in place. Not only to prioritize across all the various opportunities, but to also bring them into alignment with the overall strategy of the organization.

What I believe is needed is a separate framework for the early stages of the product/experience innovation process that dramatically shrinks the decision loop time in the early stages of innovation versus that afforded by traditional stage-gate.

So who is responsible for innovating the innovation process? This speaks to the question of what is the product/service management model of an organization. Some models have PM being an inwardly-focused role, aligned with development and heavily focused on writing specs and a project management role. Outward-facing models (”market-driven”) have the product marketing function totally focused on determining customer needs and the marketing of the product once it is released.

In my opinion, the strongest model has the product management function driving innovation by playing a central role in the overall orchestration of the innovation effort, both inward and outward facing. In this model, product management would be responsible for the ongoing innovation of the innovation process.

Leadership in the public eye

Posted on March 11, 2008
Filed Under Leadership, Norman Wolfe | Leave a Comment

I can’t help but comment on the recent news about Elliot Spitzer, Governor of NY and former prosecutor of such high profile cases as Dick Grasso, former CEO of the New York k Stock Exchange.  Mr. Spitzer had promoted himself as the protector of the small guy against those corrupt corporate executives.  His whole public image was one of righteous indignation against the human failings of others.

There is a saying that what goes around, comes around, and many people are gloating over Mr. Spitzer’s fall this morning.  I am not one of them.  Yes what goes around comes around, but not in the sense many people are talking about in the papers today. 

When we act from righteous indignation towards others, something will come along in our lives where we are brought to our knees humbled by a discovery of our shortcomings.  Whether it is Elliott Spitzer or Ken Lay or bill Clinton, arrogance, is followed by humiliation.  This is what Mr. Spitzer is experiencing as we speak.  While he is doing this on the screen of public scrutiny, it is a lesson I had to experience in my life as well.  Fortunately my arrogance and righteous indignation did not require my humiliation phase to be paraded in front of the public in the New York Times and Wall Street Journal.  I was able to learn its lessons in a more private way.

What we tend to forget about our leaders is that they are, first and foremost, human beings. 

Not one of us is perfect and we all have our shortcomings, and our leaders are no different.  Perhaps it is our failing that we expect our leaders to be perfect.  There is a Buddhist saying that the disciple has advanced when he accepts the fallibility of his Guru.   Even the founders of our country understood that all people were fallible and so designed our system of government to have the checks and balances that protect the society overall. 

Perhaps the real lesson in scandals of failed leadership is for the followers to better understand the role of a leader, a role that is far less than an all knowing “God”. 

But let me not end here for there is an equally important lesson for leaders – stop pretending you are the all knowing “God”.  Accept your own humanness and more importantly accept the humanness of those you lead.  This ability to know yourself as human and others as human is to know compassion and compassion brings about humility; humility engenders authenticity which in turns brings about the trust a leader needs to truly lead.

Norman Wolfe

 President/CEO Quantum Leaders, Inc  

The evolution of the organization – Part 3

Posted on March 1, 2008
Filed Under Leadership, Management, Norman Wolfe, Organization & Culture | Leave a Comment

The third phase began to emerge in the literature around the late 80s and early 90s and is now becoming more recognized in the life of corporations.  I have called this stage the Spiritual stage, not because of its relationship to religion or any specific spiritual path, but because it has all the elements found in spiritual literature.

This phase calls for organizations to operate with a sense of purpose and meaning.  It is also integrative and holistic.  Holistic in that there is now a recognition that an organization is comprised of many sub entities that must operate as a single integrative unit.  All the parts must collaborate or coordinate for the whole to be effective.  The key to bringing the organization together is its deeper purpose, it very reason for existing.  It also calls for organizations to be constantly seeking new knowledge on which to grow and build and this is the third attribute of a Spiritual organization, questioning and learning.  And finally the fourth attribute is compassion and humility.  Even the greatest of organizations are toppled when they believe they are better than another.  But with humility we recognize that no matter how great we become we are still connected to every other organization in the world in a massive ecosystem.  And what hurts one organization in the end hurts us all.

Lest people think this is all well and good but how does it help me achieve the performance required, how does this make any difference to the bottom line.

To answer that we must first look at the failings of the first two stages.  The machine stage is great at refining the processes on which the organization depends and when it comes to improving efficiencies there is now better set of attributes to use to guide our decisions.  But the best tuned engine will go nowhere without high grade fuel to drive it.  The fuel in and organization is the energy of the people and so the second stage emerged guiding leaders to empower the people.  Yet as I pointed out in the previous post, the OD efforts are often stymied because it is in competition with making the machine work better.  Besides since the machine stage is driven mostly by metrics that are relatively easy to define, it dominates the rational thinking business is predicated on.

So we can fine tune the machine or we can improve the quality of the fuel (the engaged and energized workforce) but the problem is that it is either / or.  What is required is to integrate the two with the AND condition improve the machine AND increase the energy and engagement of the workforce, which is the very essence of the third stage.

 Norman Wolfe President/CEO  Quantum Leaders, Inc

Leadership: The Philosopher’s Stone of Innovation…? (Part 2)

Posted on February 26, 2008
Filed Under Gregg Gallagher, Innovation, Leadership, Management, Strategy, Strategy Execution | Leave a Comment

Philosopher’s StoneThe other end of the spectrum re strategic decision-making is where it is totally driven by the leadership of the company. This is very often the case with start-up, early-stage and founder-run, privately held firms. The potential advantages are somewhat obvious: strategy is driven by a focused vision, factors which may not be effectively quantifiable can be considered in the decision, and the encumbrances and delays of “process” can be bypassed.

Of course, the potential downsides of a purely personal leadership-driven approach are also obvious: Key success factors may not be sufficiently considered or outright ignored, an imprudent balance of risk might result within the portfolio of opportunities (both too much or too little), and the development of a cadre of leaders within the firm that can create and manage innovation may be stinted (i.e., everyone waits for the guy/gal at the top to make these hard decisions.)

AndThe answer is that it’s not an either/or trade-off - it’s all about the AND!  Strategy and decision-making in the context of innovation should both be both process and metric driven, as well as allow for the spark of creativity, insight and intuition that only personal leadership can provide. The key challenge for leadership is to know when and where the balance between the two must be adapted to the circumstances. Sometimes you let your management team work all the issues through the process…at other times you have to step in - whether it be to breakthrough an impasse, or to course correct when you “just know” that path they have chosen is not the right one for your company.

While he is not widely recognized to be an expert in innovation project management, the observation of Kenny Rogers still applies: “You got to know when to hold em, know when to fold em, know when to walk away and know when to run.”

Leadership: The Philosopher’s Stone of Innovation…? (Part 1)

Posted on February 22, 2008
Filed Under Gregg Gallagher, Innovation, Leadership, Strategy, Strategy Execution | 1 Comment

Alchemist’s Stone

I had the opportunity to speak before the Association for Strategic Planning this week on the topic of Innovation - an inherently rather broad and deep subject, so my approach was one of surveying the various paradigms of innovation (creativity/ideation, invention, implementation, value-creation, etc.), and that all of these conceptual frameworks for understanding innovation are valid and need to be considered in the context of business innovation, which should have customer value creation as it’s central focus.

Following the talk, Stan Marcus of Capital Business Credit engaged me in a discussion surrounding the key role of strategy in the identification and creation of customer value. He identified one of the key challenges facing executive leadership regarding innovation strategy is that of choice - the identification of the one or few key products, opportunities or other initiatives that the organization should focus on executing, selected from what is most often a seeming abundance of riches - i.e., a large number of identified options, all with uncertain, indeterminate paybacks.

So how is the choice made? Some authors urge metric-driven, opportunity portfolio management processes which apply rather rigid, theoretically “objective” evaluative criteria across a number of dimensions (strategic fit, ROI, level of risk, etc.). The process becomes a rather deterministic black box in which you feed the data in on the left, and the prioritization decisions re product/service innovation are spewed out on the right.

Such approaches are intellectually attractive from the standpoint that the organization can apply agreed-upon metrics and processes to generate decisions that would otherwise be driven by subjective and sometimes highly idiosyncratic sources.

Others would argue that very often the assumptions upon which such metric-based approaches are based are themselves highly subjective, albeit cloaked in a veneer of legitimacy provided by their Excel-based delivery.

To quote Bill O’reilly: “What say you?”

The evolution of the organizations – Part 2

Posted on February 15, 2008
Filed Under Leadership, Management, Norman Wolfe, Organization & Culture | Leave a Comment

The second major stage of organization model started to emerge around the middle of the 20th century.   It was heralded by the work of the humanist psychologist like Carl Rogers, Abraham Maslow and applied to organization life by people like McGregor and Herzberg.

This movement, if one wants to call it that, added another component to how we viewed and led organizations.  If you recall the first stage was to view the organization as a machine and to improve its performance we had to fine tune the way the machine operated. Most of the focus was on the structure and flow of work through the system.  In this worldview the people were recognized as providing the energy that made the machine work, but they were viewed as just another part of the machine.  Each individual carried the same amount of energy and hence one person was just as good as another.

The second stage, what I call the Humanist or Organic stage began to recognize that each person did not provide the same quanta of energy and that there were ways to increase the energy component of the “fuel”.   And so a whole industry grew up around helping organizations and the leaders that ran them improve the energy output of the people (often referred to as increasing motivation and engagement).  And the Organization Development consultants became very popular.

What is interesting about this stage is that rather than seeing the two frameworks, and their contribution to improve performance, as complimentary they were viewed as competing approaches.  There were those who argued that at the end of the day it is all about the bottom-line, that the people side is just about making people feel good.  For them the real power for improving performance is to improve the system and the rest will take care of itself.  Even Deming, the great leader of the quality movement once said that organization improvement is 85% system and 15% people.

Of course the OD side would argue that the real power in improving performance comes from the people, that a highly motivated workforce will outperform the best organized system.  And that an investment in improving the environment, the leadership, the culture is what is really needed.

Even today this battle wages on between the two paradigms, which is really a sad situation.  If you step back and think about it the argument would be like arguing that the engine, transmission and drive shaft are more important than the fuel, or that the fuel is more important than the car mechanics. 

In reality you need to understand the contribution of both and know which attributes to apply in which situation.

This is part of what is opening the door to the next stage in how we view organization what I call the Integrative or Spiritual phase.  But more on this in my next post.

Norman WolfePresident/CEOQuantum Leaders, Inc

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