management

Do you know what drives your business?

For the past few months, we’ve been working on driver-based analysis and planning for our different business units at Spreadshirt. The effort reminded me of why so many businesses do not attempt such an analysis. The main reason: lies, damn lies, and statistics. What happens is that you start at the highest level. Like most retail businesses, for us, we can start with traffic, conversion and basket size for each of our business units. Kind of feels cold, huh?

The next step for the drivers is to get to what makes each business unit special to its customers. For us:

Shop Partner. Number of selling shop partners and sales per shop is where you head next. And, once you have that, you start thinking about the different levels of shop partners used to judge sales per shop. For example, major accounts, power sellers and then the “long tail” are typical classifications. Then, what about recruiting of those different partners? Lead generation and direct advertising can be broken into impressions, click through, registration, activation, and shop set-up. What about shop traffic and customer WOW (I believe in Net Promoter for this measure)?

For each of these, you then argue more critical drivers. And, we haven’t even gotten into regions, and their maturity, which has a big impact on the drivers.

The question is where do you stop? When do the numbers matter and when do they become details that are distracting? My experience… stay at 5-7 drivers. No lie. Pick 5-7 and stick to them. Period.

Team members can focus on levers that impact these drivers, but don’t let those levers become drivers themselves. Keep the team focused on the drivers for their business, which will help you focus on the business as a whole versus get stuck on one number.

Another recommendation… be careful not to let drivers be self-referencing. For example, we could define major accounts as accounts over a certain level. The problem with this is that you don’t know if an account is major until it becomes major. You want to be able to target leads as having “major” potential. We did this at QuickBase by defining major accounts as Fortune 500, with a special emphasis on Fortune 100, as an example. While not all Fortune 100 accounts turned major, the hit rate was higher than going after accounts with “potential”, than waiting and seeing if those became major to define them as major.

What are your thoughts and experiences with driver-based analysis and planning? When have you seen business drivers used well and when not?

What am I wearing on my shirt? To bring some levity to a serious post, I’m going to turn to one of my favorite mood lighteners, Yogi Berra.

Don’t make the wrong mistake

It is easy to catch a cold, not create one: Thoughts on viral marketing

Most viral marketing ideas go something like this:

a) We’ll create something really funny (outrageous, edgy), so people forward it around

or

b) We’ll add our logo and link to the bottom of every message our customers send from our product

Both of these end with:

…and we’ll sell lots/make lots of $$

Both of these techniques can be critical components of a viral campaign. But most often they become the focus — above the message or action you want taken — and that’s why 98% of viral marketing campaigns fail.

P&G has an example going viral, but missing the messaging/action point:

P&G’s ThermaCare Heat Wraps team created a campaign that went viral, because they listened to customers. (YAY!) They were looking for a way to promote their menstrual cramp relief line. In talking to women about menstrual cramps, the team learned that top issue from women is that they wanted men to get what having cramps felt like. The team had the idea that they could use this information to create something viral… something that hit the exposed nerve they had found. So, they created, MENWITHCRAMPS, a website devoted to the (fictitious) study of male menstrual cramps.

This campaign did hit “viral” status. Lots of talk, lots of website visits. But… people didn’t have any idea what it was selling. A typical quote:

“I am not quite sure what they are selling at menwithcramps.com, but I am buying it as soon as I can.”

Nice sentiment, but if you don’t know what you are buying, it is hard to buy, and you definitely can’t tell others to buy it. So, this team “sold” the site, but not the product. And most folks, thought it was funny and shared it, but wondered why someone had made the site, as they noted how professional it was. (Note: For awhile the site didn’t even link to the ThermaCare site, as it does now.)

Dove and Live Vault each have great examples of ads that became viral and got their message across:

Dove’s Evolution video hits both the emotion of how people feel, and goes to the core value of Dove’s message… real beauty. Even if it hadn’t gone viral, it would still be an awesome ad that got across their message, which has to be the foundation of your campaign.

Live Vault’s John Cleese video (requires registration) shows you can be funny and get across your message. They used Cleese as a doctor at the Back-Up Trauma Clinic. Every IT manager (their target) relates to this and it gets across the message of the pain that’s associated with “out-of-date, tape-based back-ups”.

So here’s my 3-step recipe for making something going for viral without wasting $$:

    1. Talk to prospective customers to find out:
      1. What is important to them about your product? E.g., ThermaCare’s [missing message] “relief”, Dove’s “real beauty”, Live Vault’s “easy, up-to-date recovery”
      2. Is there an emotional trigger for them around your product? E.g., ThermaCare’s “men understanding”, Dove’s “fake beauty”, Live Vault’s “out-of-date back-ups”)
    2. Make a campaign that you know nails what is important to prospective customers about your product.
    3. See if you can come up with a simple, unexpected, and concrete story around the emotional trigger. (For those of you that haven’t had a chance to read Chip and Dan Heath’s book Made to Stick, these qualifiers, including emotional, come from that book. This is the clearest set of qualifiers I’ve seen for viral yet.)

And if this doesn’t work, you can always attend the Viral Learning Center. (Thanks to the Church of the Customer blog for that one!)

So, what’s on my shirt? Well, I have an idea for small business marketing that may or may not be viral. It gets across a key message that many small businesses want to get across to their customers and it brings up a funny childhood emotion:

I know something you don’t know

See most small business owners start their business because they have an expertise that they want to share/live… something they are passionate about. I believe, if they created fewer logo shirts, and instead wore a shirt like this, they would be better marketers. This shirt would spark the conversations that they want to have… telling people about their passion.

I’ll tell you how it works! I’m going to be wearing this one at the South Beach Wine & Food Festival this weekend. Evan got me this trip as a Christmas gift (we are foodies), but we will also be talking to the chefs about working with us on culinary cruises for SureCruise.

Other shirts we’ll be wearing this weekend say:

Ask me about sea + food

Sea the world
Eat the world

Of course, I’ll also be sharing that Spreadshirt is what enabled me to get these targeted messages across simply, unexpectedly, concretely. See… I have several of the points going for viral on this idea! 🙂

Knowing when to stop

I’m someone who craves quick and thoughtful decisions. (We called this “think smart, move fast” at Intuit.) Balanced with that, I’ve always been a believer in stopping meetings and conversations that are not moving forward; sometimes you just need the break to change the way something is progressing. Lately, the number of meetings and conversations I’ve stopped for this reason is more than I want. (Not an extreme, just more than the “rarely” that I like.)

My general guideline for knowing when to stop is if I find myself repeating the same thing in a different way a fourth time, it is time. The key point is “in a different way”. Make sure you are listening to understand the other party well enough to change your response to answer their objections, or clarify your position. You should also listen to hear the differences in their explanations. Overall, if you are both just repeating yourself, then you likely won’t move forward at all.

So that’s how I approach it… do you have any rules that you use for when something isn’t moving forward and how you solve that?

For what’s on my shirt, I have a line that is appropriate for this story, but actually happened to me a week or so ago. I was paying for parking at an automated machine. I swiped my credit card, and on the screen it said:

Waiting for an answer

Here I sit now waiting for your answer… and looking forward to the conversations this t-shirt starts when I wear it. 🙂

Experience: The good, the bad, the ugly

Experience is a hot topic around Spreadshirt. Over the past few years, Lukasz, Michael, and Matthias have built a terrific team that exemplifies the Gen Y workforce described by Jay Adelson in Business Week’s “Digg This: Talking to Gen Y”. A few weeks after I joined, I wrote to Harry Nellis, “our” partner at Accel, and told him that I could feel at Spreadshirt what Adelson describes as the ideal for Gen Y:

“…create an excitement about the company’s achievements, but more important, help employees recognize their role in accomplishing that mission.”

I love seeing and feeling this at the company. So, what’s the hot point? Well, Gen Y also means younger, which means fewer years of experience. Since we have a great, motivated team… why do we need experience? Our discussions have led me to these thoughts:

We know the good:

Experience brings us the possibility of learning… from mistakes, from success… mostly from mistakes. Mistakes can give us that “hand on a hot stove” imprint in our brains… you remember not to do it again from the OUCH. The important thing is that you step back to learn from your experiences, and [Alert: hard part here] do your best to — without bias — understand why something failed. It is only then that you can actually apply your experience… and not be doomed to repeat history.

We know the bad:

A fun example of the curse of knowledge is given by Stanford professor Chip Heath in Made to Stick (which gets an A++ rating from me… I’ve followed Chip’s work for a few years and am a believer). In a Stanford study, participants were assigned either a “tapper” or “listener” role. The tapper would tap out a very well-known song and the listener would have to guess the tune. Before the answer was revealed the tapper had to say whether the person would guess the song or not. The tappers said that the listener would get it right 50% of the time… reality… the listeners got it 2.5% of the time. The reason: The tappers had the curse of knowledge; they heard the full song in their head with complete accompaniment, while the listener heard some form of Morse code. When you are applying your experience, remember that you are hearing the full symphony, while others could likely be hearing you tap on the table… or it gets bad.

I’ve recently discovered the ugly:

Closely related to the good and the bad is my recent discovery of the ugly. With the Spreadshirt exec team, you are rarely lacking in critical analysis, which is awesome 95% of the time. The ugly is the 5% of the time when you just can’t explain why something is wrong. But, you have seen it so many times in so many different ways that you know what will happen — and, you don’t want to stick your hand on that stove or see others go through it. Ugh. While your gut (which, IMHO, is your inner self expressing your experience) tells you it is wrong, you can’t justify why. And, the arguments contrary to your gut are compelling. When this happens for me, I try to get to what experience is driving my gut. When that doesn’t work… call it ugly, decide whether you can live with the decision either way, make your case, and move on.

Along with my intro story, another story goes well with what’s on my shirt today. Harry recruited me for this position. As I talked to him more about the opportunity, I admit to being surprised when I realized that they were recruiting me as the gray hair for the org. I did think that I had a couple more positions (not just a couple of years, but a couple of positions!!) before I was the gray hair. But, alas… here I sit as a:

gen X geezer

Before it is tooting my own horn…

First things first…

HAPPY NEW YEAR!

I had a terrific holiday in Santa Fe and hope your holidays were just as wonderful.

The shirt presents were hits; I got to see first hand how many smiles they can generate. I didn’t think I would get Richard out of his “I’m the decider” shirt. Thanks to the team for great execution on these presents!!!

Speaking of the team, I wanted to write a note about our customer service team before it would be considered tooting my own horn.

Before I joined Spreadshirt, I placed some orders to understand the full Spreadshirt offering. When I talked to our US Service Director, Denise, during the interview process, I shared my positive experience with her team on one order that had an issue. She thanked me, then proceeded to tell me about what had happened. What’s surprising here? She took initiative to investigate whether I had placed any orders before talking to me. I hadn’t told the Spreadshirt folks that I had placed the orders, but she checked. Since I’ve joined, I see that Denise runs her team this way, they investigate problems, and that provides differentiated service.

Research, investigation… whatever you want to call it… makes a difference, and it’s something I live by. It takes time, but even if you’ve gone down the wrong path, it works. It shows people — customers, partners, employees, colleagues, press, analysts — that you care enough to think through their situation. The key, it must be real, not mechanical. This is the quality that Denise brings out in her team, and it makes for rave reviews… and not just from me! My Google Watch on our name is regularly bringing up praise for our service team, which I happily forward along.

As a manager, how do you ensure a customer service team that holds this as a key goal?

  1. Hire people that are curious.
  2. Hire people that naturally show they care.
  3. Hire people that don’t get stuck on one theory to the exclusion of others.

The good news is that these are fairly clear qualities to get to during an interview. So, what’s on my shirt today? It is a bit long, but speaks to the essence of all three points:

In science, the most exciting phrase is not “Eureka!”, but “Hmm… that’s funny…” — Asimov

Thanks to a customer service team that I’m proud to represent!

Blame me… maybe that wasn't a good idea

Whenever I’ve moved on from a job, I’ve always told the team I was leaving to blame me for the wrongs when I was gone to move past the blame game quickly, and focus on solving the issue. A piece of an awesome Fast company article on Toyota’s continuous process improvement way of life made me think that’s not such a good idea… because it let’s people continue the idea that blame (or shame) is a natural part of a work environment. Here’s the story in brief:

Jim Wiseman joins Toyota in community relations. In his first presentation to the plant manager, he spoke about how well things were going. When Jim finished, the manager, Fujio Cho, now chairman of Toyota worldwide, said, “Jim-san. We all know you are a good manager, otherwise we would not have hired you. But please talk to us about your problems so we can all work on them together.”

This reminded me of one of my absolute favorite work environments, when I was working for Lorrie Norrington at Intuit. She was SVP of Small Business and Personal Finance at the time, and was one of the three board members, who directed the Innovation Lab I ran. What was remarkable to me about working for Lorrie was that in any meeting, she focused on what was wrong. But, not in a negative “what did you do wrong” way, rather in a moving forward way. She was focused on solving together piece, and never made you feel like she was stepping in because you couldn’t handle it. I have a feeling this is what the folks at Toyota feel like… and it feels productive!

I need some techniques for setting that environment up correctly, because, as recently as this week, I’ve unintentionally put people on the defensive about what was done when I wanted the focus to be on moving forward. It wasn’t productive. Have you worked in an environment where the focus was deeply focused on the problems, but it wasn’t about blame or shame? If so, how did you, your manager, or your team set the tone for this?

I think what would go on my shirt for this:

Learn from history, but don’t relive it

I need to learn from you and your experiences here, as it is core to the way I want to run my businesses, and it is one where I don’t have a “doing business as Jana” way of doing things that I’m comfortabe with. So, what is your “doing business as you” on this topic? Or what are the experiences you’ve had?

Drucker rocks

Andreas, who runs our brand evangelism, gave me The Starfish and the Spider to read. I agree with him that the book isn’t a big WOW, but has some nice points. My favorite in brief…

Peter Drucker consulted with General Motors in his early days. He suggested to the GM management that they:

Ask customers what worked for them and what didn’t; and incorporate that feedback into corporate strategy.

Note, Drucker didn’t say, “incorporate that into the product design“, but rather, “incorporate that into corporate strategy.” So, while many companies aren’t even doing the former still today, Drucker understood the power of the latter… oh so many years ago.

And, after his thoughts were rejected at GM, he took these and more thoughts to Japan. He said they embraced this theory:

Top management is a function and a responsibility, rather than a rank and privilege.

Think about this to drive understanding and actions from management-to-employees and employees-to-management.

Why are these my favs? The simplicity in both statements. Do you have any other Drucker-isms you live by? I might add it to my shirt, which on the front would say…

Drucker rocks!

P.S. If you want to read a great book with new business ideas, get Mavericks at Work by Bill Taylor and Polly LaBarre.