Commercials Are for...

Last night’s Super Bowl commercials made me wonder about what commercials are for. It’s always been my thought that commercials are to make you buy something, inform you about a product, improve the image of a brand, or give you a call to action. The incredibly expensive commercials yesterday mostly made me…do nothing. I had no desire to look up information about a product, I certainly had no desire to buy anything (even the Doritos commercial didn’t make me wish we had a bag at home). I did watch the car commercial with Jerry Seinfeld and think that I wanted to catch the episodes of his old show with the Soup guy…but I don’t think that was the purpose of the spot. I did watch the Go Daddy spot and wonder where Danica was going to race this year…is it NASCAR or Indy? There were commercials that were powerful (GE) and there were commercials that were just plain silly (end of the world car commercial). There were commercials that were depressing (Clint Eastwood car commercial which reminded me that most of the problems in Detroit were as a result of bad decision-making by auto executives) and there were plenty of beer and soft drink commercials. But today, in the clear light of morning, there should also be some Boards of Directors that ask some very pointed questions of CEOs and Chief Marketing Officers about why in the world they dropped $3.5 million dollars (plus the creative cost) for those spots?

Here’s what the NY Times says about the commercials.

http://www.nytimes.com/2012/02/06/business/media/super-bowl-commercials-from-charming-to-smarmy.html

The Future Via Tech

I haven’t been blogging much of late, as I’ve really spent more time with the quicker tweets on Twitter. But, this article which I saw in Allen Kupetz’s fine blog Future of Less, was so good, that I felt compelled to post.

The Coming Tech-led Boom
http://online.wsj.com/article_email/SB10001424052970203471004577140413041646048-lMyQjAxMTAyMDMwMDEzNDAyWj.html

Three breakthroughs are poised to transform this century as much as telephony and electricity did the last.By MARK P. MILLS AND JULIO M. OTTINOIn January 1912, the United States emerged from a two-year recession. Nineteen more followed—along with a century of phenomenal economic growth. Americans in real terms are 700% wealthier today.In hindsight it seems obvious that emerging technologies circa 1912—electrification, telephony, the dawn of the automobile age, the invention of stainless steel and the radio amplifier—would foster such growth. Yet even knowledgeable contemporary observers failed to grasp their transformational power.In January 2012, we sit again on the cusp of three grand technological transformations with the potential to rival that of the past century. All find their epicenters in America: big data, smart manufacturing and the wireless revolution.Information technology has entered a big-data era. Processing power and data storage are virtually free. A hand-held device, the iPhone, has computing power that shames the 1970s-era IBM mainframe. The Internet is evolving into the "cloud"—a network of thousands of data centers any one of which makes a 1990 supercomputer look antediluvian. From social media to medical revolutions anchored in metadata analyses, wherein astronomical feats of data crunching enable heretofore unimaginable services and businesses, we are on the cusp of unimaginable new markets.The second transformation? Smart manufacturing. This is the first structural shift since Henry Ford launched the economic power of "mass production." While we see evidence already in automation and information systems applied to supply-chain management, we are just entering an era where the very fabrication of physical things is revolutionized by emerging materials science. Engineers will soon design and build from the molecular level, optimizing features and even creating new materials, radically improving quality and reducing waste.Devices and products are already appearing based on computationally engineered materials that literally did not exist a few years ago: novel metal alloys, graphene instead of silicon transistors (graphene and carbon enable a radically new class of electronic and structural materials), and meta-materials that possess properties not possible in nature; e.g., rendering an object invisible—speculation about which received understandable recent publicity.This era of new materials will be economically explosive when combined with 3-D printing, also known as direct-digital manufacturing—literally "printing" parts and devices using computational power, lasers and basic powdered metals and plastics. Already emerging are printed parts for high-value applications like patient-specific implants for hip joints or teeth, or lighter and stronger aircraft parts. Then one day, the Holy Grail: "desktop" printing of entire final products from wheels to even washing machines.The era of near-perfect computational design and production will unleash as big a change in how we make things as the agricultural revolution did in how we grew things. And it will be defined by high talent not cheap labor.Finally, there is the unfolding communications revolution where soon most humans on the planet will be connected wirelessly. Never before have a billion people—soon billions more—been able to communicate, socialize and trade in real time.The implications of the radical collapse in the cost of wireless connectivity are as big as those following the dawn of telegraphy/telephony. Coupled with the cloud, the wireless world provides cheap connectivity, information and processing power to nearly everyone, everywhere. This introduces both rapid change—e.g., the Arab Spring—and great opportunity. Again, both the launch and epicenter of this technology reside in America.Few deny that technology fuels economic growth as well as both social and lifestyle progress, the latter largely seen in health and environmental metrics. But consider three features that most define America, and that are essential for unleashing the promises of technological change: our youthful demographics, dynamic culture and diverse educational system.First, demographics. By 2020, America will be younger than both China and the euro zone, if the latter still exists. Youth brings more than a base of workers and taxpayers; it brings the ineluctable energy that propels everything. Amplified and leavened by the experience of their elders, youth and economic scale (the U.S. is still the world's largest economy) are not to be underestimated, especially in the context of the other two great forces: our culture and educational system.The American culture is particularly suited to times of tumult and challenge. Culture cannot be changed or copied overnight; it is a feature of a people that has, to use a physics term, high inertia. Ours is distinguished by incontrovertibly powerful features, namely open-mindedness, risk-taking, hard work, playfulness, and, critical for nascent new ideas, a healthy dose of anti-establishment thinking. Where else could an Apple or a Steve Jobs have emerged?Then there's our educational system, often criticized as inadequate to global challenges. But American higher education eludes simple statistical measures since its most salient features are flexibility and diversity of educational philosophies, curricula and the professoriate. There is a dizzying range of approaches in American universities and colleges. Good. One size definitely does not fit all for students or the future.

How Three Companies Tweet Without Fear

I liked the piece in today’s Wall Street Journal by Elizabeth Holmes and on how three different companies deal with Twitter. My old personal favorite was Sea World, where they had Shamu tweeting. It took a while for me to “get” Twitter, but I love the service and along with HootSuite, I find it one of the indispensible tools to keep me up-to-date on the world of business…and other things as well. For example, during football Sunday’s, I keep my iPad next to me as I watch games as I follow the former head of NFL officiating Mike Pereira (@MikePereira) as he tweets about officiating issues regarding the games and gives his followers the correct information on why calls were or were not made.

From today’s article:

This week AMR Corp.'s American Airlines found itself caught in a public spat after actor Alec Baldwin vented on Twitter after being removed from an American flight. "Flight attendant on American reamed me out 4 playing WORDS W FRIENDS," Mr. Baldwin tweeted, referring to a Scrabble-like online game.

American replied via Twitter asking for his contact information. A day later, American tweeted, "UPDATE: Facts about yesterday's removed passenger" along with a link to a statement giving a less-flattering account of the passenger's behavior without mentioning Mr. Baldwin's name. Mr. Baldwin deactivated his Twitter account after the incident and apologized to his fellow passengers.

Companies are adopting a variety of strategies for navigating Twitter's pitfalls. One of the biggest issues is how many people to trust with a company's account, known as its handle. Spread the authority too thin, and the burden can be overwhelming. Authorize too many people, and the risk of mishaps multiplies. Here's how three very different companies—Southwest Airlines Co., Whole Foods Market Inc. and Best Buy Co.—are approaching the task.

From Drucker to Zuckerberg With a Little Page For Good Measure

Over the past three months, I hadn’t gotten my Fortune magazine. Based on a combination of moving from Syracuse to Boca Raton and that my subscription expired, I hadn’t read the publication for some time. So this morning, sitting outside drinking coffee and eating Cote France’s wonderful almond croissants, I had the chance to renew my longstanding love for this magazine. The magazine (which I now also have on my iPad) gave me a chance to read stories that started with Peter Drucker and ended up with the epic battle between on going between Mark Zuckerberg and Larry Page in the Battle for the Future of the Web. My only wish is that the Fortune website would make it easier to find the articles from the print pub so I can make sure that my students and friends can read them.

I particularly liked the short piece on Francis Hesselbein, who reminded me again of one of Drucker’s five questions:

1. What is our mission?
2. Who is our customer?
3. What does the customer value?
4. What are our results?
5. What is our plan?

For Hesselbein, who used to be the CEO for the Girl Scouts of USA, the mission was “short, powerful and compelling: To help each girl reach her own highest potential.” You have to love that mission, and it isn’t something that would be spit out of the Dilbert Mission Statement generating machine.

On Dancing with the Stars, Hiring and Never-Ever Giving Up

On an overcast and rainy Sunday morning, after reading about Stanford’s amazing win on ESPN.com, some interesting things from the paper over a couple of cups of coffee:
But my first smile of the day came from seeing JR Martinez on the cover of People magazine. While most of you know JR from Dancing with the Stars, he is also a graduate of the Entrepreneurship Bootcamp for Veterans with Disabilities program…a program that I am proudly associated with...pick up that magazine and try not to smile when you read about this amazing young man. Here is a link to a story on the People magazine piece from JR’s home town Dalton Daily Citizen. Congratulations JR!

From the NY Times…while it’s much easier said than done, In a Big Company, Make Everyone an Entrepreneur. The article, a recurring weekly feature by Adam Bryant, is an interview with Lynn Blodgett. president and chief executive of ACS, an I.T. services subsidiary of Xerox.

From the article:

A. One of the ways that we do it is we drive the P.& L. as deep into the organization as we can. We have a P.& L. at a customer level, that’s mandatory. We have to be able to see how we’re doing with that customer. A lot of companies can’t do that. In our business we drive the P.& L. down to the people who are actually doing the work. So if we can make a P.& L. for a $10 million business, we’ll give that guy the P.& L. and he’ll have profit accountability, revenue accountability and customer satisfaction accountability. And as they grow, they make more money. That results in a higher performance, in my opinion.
So you give people control, hold them accountable, give them control of their resources, and then monitor what they do. And if you do that, you’re going to tap into, in our business, the highest level of drive — entrepreneurial drive. I want ACS to look like a whole bunch of sole proprietorships. Because that way, people are thinking to themselves, “If this was my money, if I was doing this, would I really spend it? Do I have to buy that computer right now or can I get by with my one that’s two years old?”
Q. What else is important to your leadership style?
A. Another is that nobody is above being moved, being touched, being influenced by a small gesture. I’ve experienced it myself. Somebody might call me or send me an e-mail to say, “Hey, I got that bonus and I just want you to know that really means a lot to me.” We have 85,000 employees, and I don’t get 85,000 e-mails. So when I get one it means a lot.
So it’s the little things. Like writing a note that says, “You did a great job,” or: “I’m sorry I got after you. You’re a super performer, and I lost my patience with you, and that’s my error, and forgive me for doing that.” We also set up phone calls when we win a deal, and we’ll get the team together and say: “Hey, tell me about that. What was the hardest thing? How did it come together?”

From the same article on hiring:

How do you hire? What questions do you ask?
A. The very first question is always “Tell me about yourself.” And not the résumé — I don’t want the résumé. Just tell me about yourself. What do you like? What do you enjoy doing? Because I think you can tell a lot from very open-ended questions.
Then I will say, “If you had the perfect job, what would you do?” And then I always ask: “Why do you want to come here? What is it about us?” Then, finally, “What do you think you could do to help us?” In the positions that I’m looking for, when you ask people what they can to do help, you often get some great answers and insights.
Q. What are the qualities you’re looking for?
A. People who are honest. That’s the No. 1 thing. I don’t have a test for that. I think that’s one where you have to go with your gut for a lot of it. And this is my prejudice because I didn’t go to college, but their intellect, their ability to think, is more important to me than any degrees they might have. And are they loyal? Will they take risks? Do they have integrity? Frankly, the technical aspects of it are way, way down on the list.

And in the Opinion section, What Tax Dollars Can’t Buy, Did you Hear the One About the Bankers and Our Unpaid, Extra Shadow Work give somewhat different perspectives on the current economic discussion.

From Dugout Phones to Netflix

I’ve been enjoying reading newspapers and magazines on my iPad, and in the last couple of days there were more than a few articles that caught my eye.

First, especially after the problems last night in the World Series with the dugout telephones, I went back and re-read the NY Times story in the Sunday paper on the use of that old relic of an instrument of communication in the dugout Ironically, Tony LaRussa was the cover photo for the story. From the article:

While landlines in homes collect dust and serve increasingly decorative functions, the attitude among baseball clubs is a familiar one in a sport tied tightly to old-fashioned ways: why change what works?

“The same old phones, the same old process,” said Derek Lilliquist, the bullpen coach of the St. Louis Cardinals. “I guess they’ve been that way forever.”
In today’s Wall Street Journal, there were a couple of articles about entrepreneurs that caught my eye; one dealing with China and the restaurant industry and the other dealing with entrepreneurial bankers.

A Secret Recipe in China details the story of an entrepreneur in the restaurant industry who did what some of the major chains couldn’t do…succeed in China. From the article:

Shanghai's hygiene bureau objected when Scott Minoie tried to build an open kitchen in his first Element Fresh restaurant nearly a decade ago, saying it would be unsightly: "too foreign."
But the Boston native persuaded officials to let him press ahead, confident that Chinese consumers, concerned with food safety, would appreciate a Western-style bistro that lets diners see their laffa-bread salads and raspberry smoothies while they're being made.
Now he has a chain of 11 restaurants. Sales are on track to hit $30 million this year, up 40% from last year, according to Element Fresh's managing partner, Frank Rasche. The chain's profit margin hovered between 10% and 15% last year, he says. They plan to open about 40 more outlets in China by 2015.


Go West, Investment Banker, tells the tale of one particular gentleman who went to KeyBank from Bank of America. From the article:

In July, though, the 42-year-old Mr. Fowler left the second-largest U.S. bank by assets, where he was a director covering private equity, and moved to Cleveland. He joined KeyCorp, a regional bank with a loan portfolio a tenth the size of Bank of America's, to do a similar job.
The deals at KeyCorp are smaller—and so is the paycheck—but becoming a big fish in the relatively small pond of regional banking has its advantages. In his new role, he can take on a larger role in the bank, while enjoying the benefits of living in the Midwest.

"It's very entrepreneurial," says Mr. Fowler. At Bank of America, he says he was one among legions of bankers focused on "elephant hunting" for billion-dollar deals that have become increasingly scarce. By contrast, at KeyCorp, "there's a real energy and excitement here," he says.

This week, I also sat in on Professor Brian Sommer’s Managing Organization class. Students did presentations on various companies, and one of them was Netflix. It was particularly interesting to hear about the problems of this company, given the press they’ve been getting lately. Today’s paper followed the problems of this company with a piece, Netflix Shares Sink 35%...never the headline you want to see for your company.

Now, back to my iPad.

HP's Interesting Move

Will HP’s move to hire Meg Whitman cause corporate CEO’s to decide not to keep strong exec’s on their boards? While I haven’t been following the last few months of HP particularly closely, I was surprised to see the way that they handled the firing of Leo Apotheker. What I find interesting now is the question of whether, if you’re a corporate CEO, would you want a strong unemployed or retired executive on your Board? Now I know that any strong CEO shouldn’t be intimidated by having strong exec’s in the boardroom, but I wonder now if many will find that tempts fate a bit too much and decide to take the safe route and have pals on their Board. After all, if you’re a young head football coach, you don’t generally have as offensive or defensive coordinators seasoned coaches who could step in and take your place the minute the owner becomes displeased. In the same manner, unless you’re a Jeff Immelt or Bob Lutz, with the notion of HP in your mind, you might want to not have your successor sitting there tempting the rest of the Board to make a move. And having a weak board is a move that will almost always hurt the company and its stockholders.