“It wasn’t the strategy that failed…its execution was flawed”

The role of “fair process” in product and service launches


All management is a process of continuing negotiation, leadership and channelling disagreement. I’ve long had difficulties with the idea of consensus management, since in my experience, managers who claim to operate with consensus are frequently bullying tyrants with whom everyone agrees – that’s consensus. Of course, there are benevolent tyrants as well as malevolent ones, but the tyrannical approach, whatever it is, tends to blame and scapegoat others since it’s unable to accommodate human difference.

What took me here this morning was thinking about strategy and that well-worn dictum, “It wasn’t the strategy that failed. Its execution was flawed”. And that’s usually about your people and how they’re managed.

If people don’t understand change then they may fear or resist it, no matter how sound your strategy is. It’s an issue for us since frequently we’re involved in strategic change but not the day-to-day management of its implementation. Major product and service launches need everyone’s buy-in.

An idea we like that comes from an old favourite of ours, Blue Ocean Strategy, is that of "fair process". Fair process is based on the idea that people care as much about the process through which an outcome is achieved as they do about the outcome itself. It also recognises, unlike some consensus ideas, that difference is healthy and that difference can build improvement.

In the Blue Ocean world, it’s called the three E Principles of Fair Process where the Es stand for Engagement, Explanation and clarity of Expectations.

Disagreement is very healthy. “Engagement means involving everyone in the strategic decisions that affect them by asking them for their ideas and allowing them to refute the merits of one another’s ideas and assumptions. Engagement communicates management’s respect for individuals and their ideas…(it) sharpens everyone’s thinking and builds better collective wisdom. Engagement results in better strategic decisions by management and greater commitment from all involved to execute those decisions”.¹

It’s a funny thing about these blog posts but sometimes I question why I write about the subjects I do. Then like a self-fulfilling prophecy I walk straight into a client situation where the issues apply. It’s as if I see them coming. We rarely get introduced to situations that are green fields, usually there’s some underlying difficulty and recently I encountered a communications issue around a new service launch. Everyone was thinking and acting in different directions. Everyone was also very committed to the company’s success but day to day pressures meant they were all acting according to their own perceptions of operational priorities in their own business areas (aka “silos”). Suffice to say they were not making progress towards their new goals fast. They’d planned to hold a strategy development workshop but the strategy looked clear to us even if it still needed work on the detail. We changed that workshop to “vision-sharing” that hopefully will unite the team around the vision rather than encourage individual interpretations and actions based on what they perceive the strategy might mean for them.

…which leads us on to Explanations. I know it’s obvious but too often the obvious is the thing most frequently taken for granted and therefore overlooked. Explanations are about developing a common understanding as to why decisions are made the way they are. It also provides important feedback that enhances learning and development. For the manager, the key factor is making the explanation with their ears wide open! Taking the time to explain the rationale is both involving for the employee and demonstrates that the decisions have been taken impartially in the best interests of the company.

Finally, in a point that’s closely linked to the situation we found ourselves in recently, there’s Expectation clarity. To achieve fair process, it matters less about what the goals, targets and responsibilities are and more that they are clearly understood by people in terms of what the development means for them. When people clearly understand what is expected of them, far less time is spent in political jockeying, clearing the way to make rapid progress with the new launch project.

This process is fundamental to change. It’s also a cornerstone of managing product and service launches. The three E Principles must be applied together. It’s no good encouraging engagement in the belief that explanation and clarifying expectations will follow naturally. They won’t. Fair process is important in shaping people’s attitudes and behaviour. It provides people with the intellectual and emotional value that sustains them. It recognises that people deserve to be treated with respect and dignity wherever they work in the organisation, and it builds trust. I’d rate that a whole lot healthier than achieving blind “consensus”, wouldn’t you?

¹ Blue Ocean Strategy by W Chan Kim and Renee Mauborgne, Harvard Business Press 2005, pages 175-176

A serious outbreak of Return-On-Investmentitis - Making the case for live events

What strange things humans are. We’ve been amused, perplexed and ultimately stimulated into writing this blog in response to a newish trend of making the financial case for live events/communications. Okay, so we know we’re in an era of austerity and that we must all make every penny count but that does not mean that spending on a conference is wayward, rash and irresponsible.

As dozens of live event agencies rush to make the business case for live communication – there’s a whole lot of ROI calculations out on the Internet; designed, presumably to appease or persuade “procurement” that “doing this live event is a good thing and yes, we really can show a return on investment”.

How do you measure value?

But we’re left wondering “how do you measure the ROI on a company conference, a press and public launch or an AGM?

We’ve created only a few events in our lives out of thousands where we can genuinely attest to a measurable ROI. The most memorable was a large-scale analyst meeting for a major tech company on the east coast of the United States, where we outlined the company’s roadmap, staged a host of live demos, showed presentations that had been editorially scrutinised for almost a month and where the most onerous Q&As had been thought through and exercised. The net result after this one day analyst event was a share price which closed at $19:53 cents (it had begun that day at $11.65) on the back of the huge number of “buy” reports from the analysts attending our event. Our client was delighted as several billion dollars were added to their capitalisation. Now that’s what we call ROI!

Our point is that these types of live events are rare where true measurable results can be obtained at the time or in advance as a cost justification. No one could have forecast the market response from our prize analyst event.

Of course, we create exceptional value and massive benefits but how does one calculate the financial value of persuasion, motivation, inspiration, influence, enthusiasm for your business and its products and a real press and analyst buzz? Value can only be demonstrated by what follows from the event , how the audience acts as a result, not by attempting the impossible – calculating ROI for the event itself.

So don’t be persuaded into nonsensical thinking.

Of course, you should define your Critical Success Factors with a clear mind, make sure you know what you want to spend and what you want to spend it on; plan early and execute in a compelling fashion. But when you come to think about live, face-to-face communications, remember that humans love to meet other humans, that they love to see and experience new things and learn and yes, they even will do more business with you if your event is done right.

Next time I’ll be writing about “partner power” in live communication.

Marc Balhetchet

Is Your Corporate Culture Ready for Social Media?

A Rocket Fuel colleague and I were involved in our own strategic discussions on our business earlier today about, in particular, where we stand on social media marketing. My own view is informed by two major corporate communications’ assignments with large clients. Both were failing organisations; failing to the extent that their operations put public lives at risk. One recovered far more quickly than the other. It’s not possible, nor would it be ethical to relate their difficulties but they were significant. Both suffered major disaffection of the workforce. In one case, the communications function was almost redundant since its demoralised employees fed the media bad news stories every day. Every day we faced a rearguard action having been slammed by the media on the day before: newspapers, television and radio.

Here we managed to bring communications back into equilibrium by seizing the initiative and improving relationships with journalists and at the same time ramping up internal communications and employee engagement.

Ironically, the second organisation, which was in a far worse state, made more rapid improvements. It had a new, very competent CEO who understood the power of his people, the press and the public. He engaged with communications directly. He agreed to the appointment of an excellent PR whose sole job was to address employee communications and involvement. She did an amazing job. We and Fred (not his real name), the new CEO, opened up channels of communications including company forums with the senior team, a fortnightly newsletter, a CEO same day response service, “Ask Fred”, a reinvigorated intranet site, open access to information, valuing feedback and other engagement initiatives. Fred faced up to all the issues, both internally and externally and did whatever he had to do in order to address them. He was an inspiring leader who took time out to be visible to all his employees. Fred and our two-person communications’ team transformed the culture. We did it quickly too, in a matter of a few months.

In Fred’s operation, we also set up customer focus groups and worked directly with customers on how we should improve and what they saw as our key priorities. We acted on their views involving them every step of the way. It worked like magic. Interestingly, we never got the bad press that we probably deserved as everyone was working on the same side to build, improve and empower the business and its employees.

In the first organisation, we recommended customer focus groups too, although none were set up due to management difficulties. Also we had to close down intranet chat facilities that were being abused by those with a disruptive political agenda. Customer issues also went unheard and unheeded. Eventually, the entire senior management team was replaced. Change continued at a slow pace. These two organisations that faced identical threatening challenges responded in different ways with markedly different results. Fred’s business with its empowered and involved employees will no doubt go on to be one of the finest of its type in the UK. We’re completely convinced.

So let’s be clear about the difference here. It wasn’t only about Fred, the excellent leader, but his understanding that employees are central to everything. Employees are the brand, the corporate values and the customer experience. They stand for the business and what it means to its customers. Our buying experience from a business is qualitatively differentiated by its corporate culture and its people.

Coming back to social media - corporate culture, style and collaboration are likely to be fundamental in determining whether or not social media implementations succeed or fail. It would have been foolhardy in the extreme for us to have promoted a social media initiative in either of these clients' organisations, no matter how involving it might have been. Any attempt to implement social media in organisations with difficult or dysfunctional corporate cultures will invariably fail. The implementation of a social media programme involving customer dialogue is a not a means of driving corporate culture improvements.

The development of a healthy corporate culture requires management commitment, healthy internal communications and a notion of fair process that builds execution into strategy. These are all required to build trust, collaboration and buy-in to change.

In a later post, we’ll say more about fair process and what that means to a business and all of its employees. Fair process to us is the cornerstone of building execution into strategy.

Geoffrey Wilkins

Reports of Marketing’s Death Have Been Greatly Exaggerated

The web is awash with pundits proclaiming the death of marketing so we set off to find out what these claims are about, who was making them and why. Besides, we hadn’t noticed any signs that marketing was in demise. Marketing is our business and despite recessionary pressures, it’s alive, well and thriving.

We made some important discoveries. We made a brief call to Harvard and London Business Schools to see what they were teaching on their marketing courses. No change there; it was marketing as we knew it and understood it to be.

So who are the mourners at marketing’s graveside? Unsurprisingly, many of them came from the ailing worlds of traditional promotions, old-style PR and advertising.

PR and advertising are not marketing. Digital content and social media are not marketing either. It’s simply media, no matter how well and how skilfully it’s written and developed.

Historically, PR and advertising formed the major part of the marketing budget. They were two ways of getting the message out to markets and as it transpired, they were often ineffective.

Joe Wanamaker, a father of modern advertising quipped wittily, “Half the money I spend on advertising is wasted, the trouble is I don’t know which half.”

Traditional advertising and PR are the old way of marketing. The world has changed, but the some of the same people are still making the same mistakes albeit via a different medium. For them marketing is the media, not the message.

A focus on promotion is tactical. Tactics removed from strategy don’t work. It’s what some of the old-style advertising and PR guys sold and frankly, they failed.

Real marketing starts before the product development process. It doesn’t start with a sales lead.

Frequently, the new riders of web promotions misquote Drucker often in an attempt to focus their clients away from strategy towards tactical promotions. Here’s a favourite, Drucker said, “…the aim of marketing is to make selling superfluous.” What Drucker was talking about was not marketing replacing sales, but that the product itself should come from a point of true understanding of the customer, their problems, interests, behaviours and needs. Marketing begins at the point of product conception. Product conception, for Drucker, is about innovation, about finding new ways to deliver value to satisfy the customer and the market.

The marketing doomsayers often claim that product development is not the role of the marketer, but that of the engineer. The notion that engineers and R&D develop products is a false and dangerous premise. Engineers and developers are problem solvers. They love a technical challenge. It’s why they do what they do. The role of marketing is to provide engineers with a problem to solve; a problem based on real market and customer issues, not just a technical challenge.

So what’s real marketing?

Real marketing is the conception of unique product value based on a deep understanding of customer values. It’s about listening to and understanding customers. It’s doing research and testing ideas. It’s about understanding the mass market and the price levels it will support.

If we’ve done our research well, then positioning the product to market is the easy part, as is promotion, since we can talk to people about their problem, issue or interest and tell them how we can address it.

Marketing is about selecting channels to market that have the coverage, reach and motivation to sell our products. It’s about understanding the competition and not trying to beat them at their own game, but doing something better. It’s also about distribution and mode of supply. Innovation may mean changing the business model to reach customers in a way that others have overlooked and finding new ways to reach non-customers. There’s branding, developing brand personality and a customer-centric culture…

That’s a little, but not all, of what real marketing is about.

Sure enough marketing has changed and continues to evolve. Harvard Business School says it well, “The current economic crisis is changing consumers' current and future purchase and consumption patterns. Search engines have changed the way consumers obtain information and make decisions and they are also dramatically changing the advertising industry. Social networks and user-generated content have opened a new way for consumers to engage with each other as well as with brands and companies. There are significant changes in the attitudes of consumers and companies about social issues (including the environment). Consumer preferences and choice of products are increasingly influenced by social factors.”

Finally, there’s an acid test for buying marketing services – see if your prospective supplier puts customer research high on their service list. If they don’t, then walk away no matter what they say about social media and engaging in customer dialogue. Customer engagement is imperative: dialogue is only meaningful when you can talk on your customer’s own terms. If the marketer doesn’t relate to customer issues before the conversation, the chances are that they don’t believe in dialogue at all.

Marketing is alive and well. Traditional promotions, whatever the medium, are dying on the vine. Promotions are one small part of tactical marketing implementation. Without clear and well-articulated strategic intent, positioning, strong messaging, and compelling, meaningful, consistent branding, promotions are like a football team without a goal at which to aim.

Marketing is evolving as are advertising and PR. They are being transformed by the world of the Internet, the redistribution of global economic power, the informed and empowered consumer, and an unpredictable economy. Its best practitioners and there are many of them, some brilliant, are reinventing themselves, us included. The new marketing reaches out beyond the material and tangible world…from the rational and the functional towards emotions, values and behaviours…to how one feels about a company, its brand and a product, rather than the intrinsic nature of the entity itself. There’s a significant growing body of research that shows that cognitive decisions are based primarily on emotions qualified by an act of post-rationalisation. Emotions become the key differentiator in a world that offers increasingly convergent product identities and functionality. Emotions are the reaction to the brand and quality is the subjective evaluation of its customer and the audience. That’s important. Quality and value are not something you build into products, that’s reliability. Quality and value are what you feel about the product or brand and it’s entirely subjective.

Finally, I’ll lighten up and let someone else do the talking. It’s Rory Sutherland, Vice Chairman of the Ogilvy and Mather Group, a brilliant advertiser, who’s becoming an equally brilliant pioneer of the “new marketing”. Here he talks about perception and intangible value. It’s engaging and entertaining to watch and contains some big lessons presented in a very amusing way. It’s worth your time.



Geoffrey Wilkins