Nonlinear Thinking

Chaos, Boundaries and Innovation

As I am a visual thinker, I do love a good graphic.  Jeremy Gutsche, Chief Trend Hunter at TrendHunter.com, included some nice ones in his book, Exploiting Chaos last year.  At the core of his thesis, that in times of chaos, companies must learn not to create structure and stability, but rather, to adapt quickly, is this evocation of a process that is aligned with much of my thinking.  While I have nits to pick with some of his conclusions in the book, I appreciate the codification of the thinking around chaos and the opportunities that learning to manage chaos to the enterprises' (and individual's) benefit serves in creating elements of competitive advantage.

The key elements of what Gutsche refers to as the Exploiting Chaos Framework are outlined below:

Culture of Revolution

Culture is more important than strategy. Culture underlies your organization’s ability to adapt, and times of dramatic change magnify this importance. Most likely, your organization perceives the need to adapt, but uncertainty and resistance are paralyzing innovation. By creating an organizational culture of revolution, you can spark a new paradigm for creative change.

Trend Hunting

Innovation and strategic advantage hinge on your ability to anticipate trends and identify the next big thing. By using the cutting-edge framework in this book, you can filter through chaos and identify clusters of opportunity to focus your innovation.

Adaptive Innovation

Engineers, designers, and scientists have invested billions of dollars to perfect human creativity. By applying the best of their proven practices to your own field, you can think big while acting small. You can rapidly identify and evaluate new opportunities.

Infectious Messaging

The Internet has created a world cluttered with chaos, but it has also created the world’s first viral platform for ideas. Well-packaged stories travel faster than ever before. Unfortunately, most marketers are stuck in a world dominated by traditional advertising and cliché. By cultivating infection, your ideas will resonate, helping you to leapfrog ahead of the competition.

 

An expanded view of the Framework adds some color to the canvas.

The first chapter of the eBook is available for free download here and the book can also be purchased at the same location.

Ladies and Gentlemen, the Campfire Strategies Corporate Overview

Due to consulting work and other demands on my time, it took much longer than expected to complete a corporate overview presentation for my business innovation advisory project, Campfire Strategies.  But, here it is, debuting as the first generation.

Campfire Strategies Overview

View more presentations from Bill Martin.

Any and all comments, suggestions, critiques are welcome.

Compendium/Miscellanea/Almanac 01.12.2011

Stuff that I find interesting.  Maybe you will too.

• Budgets, Innovation Squarely in CMOs' Sights in 2011 (Advertising Age) 
• Clouds, big data, and smart assets: Ten tech-enabled business trends to watch  (McKinsey Quarterly) 
• How Tech Will Be Critical to Corporate Sustainability in 2011 (Greenbiz) 
• Light My Fire: The Matchbook Makes a Cultural Comeback (Fast Company) 
• How Aha! Really Happens  (Strategy + Business) 
• Swimming Against the Tide: How Technology, Media, and Telecommunications Companies Can Prosper in the New Economic Reality  (Boston Consulting Group) 
• Eric Berlow: How complexity leads to simplicity  (TED)  
• The AI Revolution Is On  (Wired)  
• The Battle for Control of Smart Cities  (Fast Company) 

Telling A Great Story = $$$

Stumbled across this interesting graphic from Market Matters in the United Kingdom.  They offer strategy workshops as part of their service portfolio to assist companies in improving their capital market valuations by successfully identifying, crafting and telling their story to their key constituencies.  In their words,

"A compelling strategy that creates a vivid picture of where you will stand in five and ten year's time is vital. With so much attention focusing on an uncertain short term, developing a corporate strategy capable of creating long-term shareholder value is increasingly important.  A clear, convincing and credible strategy appeals to investors and inspires employees."

This represents yet one more data point in the rapidly expanding universe supporting the necessity for organizations, of whatever persuasion - profit/non-profit, etc -- to craft their story and tell it to every one of their key stakeholders.

Sensing the Shifts and Taking Advantage

The analysis of trends and external drivers plays a critical role in my process for developing strategies and scenarios for industries and markets, products and services.  In a world that is moving/evolving/changing as rapidly as ours, it is fundamental to the construct of a viable and adaptable path forward that we incorporate an assessment of the potential and/or probable impacts that trends and drivers might have on our planning assumptions.

External driving forces are things/situation/events that manifest outside of the company and are by and large beyond the control of company leadership. Examples of external driving forces include changes to industry structure, revolutionary technologies, dynamic economic activity, evolving demographics, non-traditional competition, and political interference.

Trends very often emerge as the result of external drivers.  Identifying and assessing emerging trends is fundamental to establishing some understanding of new market opportunities that lead to innovation in products and services.  For a corporate strategy to remain reliable and relevant it must integrate a recognition of the company’s internal drivers and core competencies with knowledge of industry structure and the external drivers/trends that create change and opportunity.

 

McKinsey and Company have always possessed the intellectual bandwidth to identify the macro-level trends that will impact our lives, business and governments before most others see them.  They have recently identified five forces, or crucibles, where the stresses and tensions will be greatest and thus offer the richest opportunities for companies to innovate and change:

The great rebalancing. The coming decade will be the first in 200 years when emerging-market countries contribute more growth than the developed ones. This growth will not only create a wave of new middle-class consumers but also drive profound innovations in product design, market infrastructure, and value chains.

The productivity imperative. Developed-world economies will need to generate pronounced gains in productivity to power continued economic growth. The most dramatic innovations in the Western world are likely to be those that accelerate economic productivity.

The global grid. The global economy is growing ever more connected. Complex flows of capital, goods, information, and people are creating an interlinked network that spans geographies, social groups, and economies in ways that permit large-scale interactions at any moment. This expanding grid is seeding new business models and accelerating the pace of innovation. It also makes destabilizing cycles of volatility more likely.

Pricing the planet.  A collision is shaping up among the rising demand for resources, constrained supplies, and changing social attitudes toward environmental protection. The next decade will see an increased focus on resource productivity, the emergence of substantial clean-tech industries, and regulatory initiatives.

The market state. The often contradictory demands of driving economic growth and providing the necessary safety nets to maintain social stability have put governments under extraordinary pressure. Globalization applies additional heat: how will distinctly national entities govern in an increasingly globalized world?

 

57 (Marketing) Channels and Nothing On

“A message came back from the great beyond
There's fifty-seven channels and nothin' on
Fifty-seven channels and nothin' on”

Bruce Springsteen

When Bruce penned those lyrics almost 20 years ago, the not so subtle suggestion was that the expansion of cable TV choices had not resulted in a concomitant elevation in overall quality.  Now, with 600 to 700 channels, that indictment has been writ large as any number of  cable/satellite/Internet channels deliver far too little in the way of edifying content.

Ancillary to this, but perhaps much more important, the competition for “eyeballs” has driven an increasing polarity in the way individual channels position themselves.  On one end, we have the many “news” channels that “ape” each other in the pursuit of the sensationalistic stories that hold the audience rapt with anticipation for the next salacious element in the narrative.  At the other, much more plentiful end, are the hundreds of boutique/niche channels whose core mission is so narrow as to obviate any chance of delivering something unique on a 24 X 7 basis.  Copying, stealing, sharing, repeating --  to the point of extremely diminishing returns.

In the digital/social media universe, we are risking much the same type of dilution of message that has become endemic in television.  As enterprises increasingly avail themselves of every channel that might, at its endpoint, find one of their prospective customers, there exists the same risk of watering down the intent of the positioning/ messaging in which so many have invested so much.  

I am cognizant of the foundation for successful branding and positioning strategy - consistency and repetition of the message across all media.  But in the constantly expanding digital environment, where many of the channels have little or no cost to the user, might the competition for “eyeballs” devolve into an exercise that dilutes the core enterprise story and value proposition?  Alternatively, with the increasing requirement to narrowcast to reach an expanding population of niche sub-segments, doesn't the new channel strategy become incredibly more complex as individual channels are allocated to serve a single unique niche target customer group?

As we complete the transition from marketing 1.0 to marketing 2.0, the advent of marketing 3.0 challenges marketers to adapt the strategy, planning, and execution of the marketing effort to embrace this increasing complexity and work to ensure that their chosen channels are delivering a message that their target constituencies find to be clear, concise and valuable.

Don Draper's Head Explodes

I think we are long past the time for substantive debate on whether the traditional marketing model is dead.  There is NO question that we are deeply in the model that is alternatively referred to as Marketing 2.0 or Social Media Marketing or, well, you pick the cutting edge nomenclature.  individuals and organizations will be forced to adapt or will perish (quickly or slowly and painfully - their choice) as they always are when the unstoppable force that is technological innovation challenges their stasis and makes their comfort zone not nearly so comfortable.  Sort of like global warming for the world we have known as marketing 1.0.

Marketing in the traditional model has, for the most part, been a very linear process.  Market research and analysis identifies both latent and active market opportunities, strategy aligns those opportunities with organization strengths (core competencies), products and services are designed/developed, positioning and branding strategies are created, value propositions are broadcast or narrowcast to the market via communications and advertising channels, and, hopefully, customers are nurtured and cared for in an effort to retain and expand share of wallet, feeding data points back into the market research effort.  This marketing 1.0 model has been primarily a closed-loop process that engaged external constituencies (the customer, partners) generally in a controlled fashion.

Social media and the digital platforms that enable it have made marketing much more about the ad-hoc, the organic, the open-ended conversation, than traditional marketing ever could have.  This is no longer the classic linear, closed-loop process of the 20th century. In this world of the marketing 2.0 model, Don Draper's head explodes as he and the team at Sterling Cooper attempt to get their hands around what it means to no longer control the dialogue that surrounds a company's products and services.

Crowdsourcing for Innovation

One of the key challenges faced by almost every middle market enterprise is that of continuous innovation.  Whether we refer to business model innovation, product and/or service innovation, marketing/selling innovation or any other process, the ability to achieve real innovation rests on an almost insurmountable need to invest human, financial and, sometimes, structural capital that middle market enterprises generally don’t possess. But, there is a way.

The emerging process of “crowdsourcing” provides an avenue for creativity and innovation by tapping the power of the Internet and social media. According to Wikipedia, “crowdsourcing is a neologism for the act of taking tasks traditionally performed by an employee or contractor, and outsourcing them to a group of people or community, through an "open call" to a large group of people (a crowd) asking for contributions.” The community that sprang up around the development of Linux is a benchmark example of the success of crowdsourcing. The process of crowdsourcing is viable for any number and genre of tasks that might benefit from a varied and populous creative resource.  This includes developing new technologies, designing new products or analyzing huge amounts of data/information. Crowdsourcing can shorten time to market for new products, uncover ways to cut costs or improve service levels, and heighten market success for new products or enhancements.

The global economy remains challenging for businesses of all sizes, but particularly for those in the SMB market.  The notion of leveraging Web 2.0 technologies to harness the potential of tens or hundreds of thousands of talented and knowledgeable individuals in a forum for mass collaboration is the essence of crowdsourcing.  While the challenges may be local, the solutions could very well be global and make the difference for middle market firms looking for sustainable channel for competitive differentiation.

Critical to success in this emerging model is precise articulation of the objective.  Achieving that, companies can then access thousands of people possessing design, engineering, R & D and promotional skills that are simply not available to firms that are reticent to staff up in the current environment.  Crowdsourcing is not risk-free.  Participants are not employees and, thus, are not subject to enterprises’ established policies, procedures and controls.  That may be a small price to pay to access critical competencies in a cost-effective and expeditious manner.

12 Consumer Values

The 12 Consumer Values to Drive Technology-related Product and Service Innovations was created by the Washington, DC-based research and consulting firm Social Technologies.  It forms a nice pillar and touchstone for anyone launching a marketing, interactive or social media initiative i.e. is my project/deliverable going to align with some/enough of the "12"?

Here is a brief explanation of the values.

User creativity
Consumers increasingly want to create, augment, or influence design and content, and share these creations with their peers. Supporting user creativity will be increasingly important to consumer technology, and will become more mainstream in coming decades.

Personalization
Consumers will increasingly look for products and services that align with their specific personal needs and preferences—whether in the aesthetics of a product or in its functional design. More goods will be created to match individuals’ unique specifications.

Simplicity
Simplicity will have growing value for consumers confronted with information overload, time stress, and technological complexity. Simplicity’s influence is already evident in new, stripped-down devices that offer just a few functions, as well as in minimalist interfaces that conceal breathtaking complexity. The common denominator of all these efforts is that they are human-centered—and thus easy to learn and integrate into busy lives.

Assistance
As consumers are bombarded with more tasks, choices, and information, and as demographic changes such as aging reshape consumer markets, they are looking to assistive technologies for help. Consumers will seek to bolster and extend their natural abilities—with technologies ranging from pharmaceuticals that enhance mental performance to robot aides for the elderly.

Appropriateness
Products and services will need to embrace the principle of appropriateness to ensure that they are suitably designed for users with varying physical needs, resources, cultural characteristics, literacy levels, etc. Appropriateness will aid in the spread of technology products and services to new markets and to diverse user segments.

Convenience
Already well-established in mature markets, demand for convenience will rise as a technology value for consumers all over the world. Consumers will look for technological products and services that give them what they want and need on demand and that reduce effort and relieve time pressure.

Connectedness
Connectedness gives consumers what they want, when they want it, and will grow exponentially with the expanding global information infrastructure. Consumers will look for products and services that seamlessly integrate with this global network.

Efficiency
Efficiency is the ratio of output to input—or, put simply, the ability to do more with less. It will become more important to technology as consumers search for products and services that let them manage emerging resource uncertainties, rising costs, and other pressures.

Intelligence
Intelligence will be enabled by innovations that increasingly shift information and decision-making burdens from the user to the device or service. The demand for greater intelligence will come in response to factors including complexity, aging, and the desire for personalized experiences.

Protection
Protection will be sought by consumers in a world that feels increasingly insecure. Consumers will look for technology-enabled products and services that strengthen their sense of personal security and protect their families, homes, wealth, and privacy.

Health
Consumers will look to technological products and services to maintain and, increasingly, improve their health and wellness. The search for health-enabling solutions will extend beyond traditional health and medical products and services to include more of the things consumers use in their everyday lives, whether at home, work, or play.

Sustainability
Consumers will increasingly look for products and services that embrace sustainability—reducing the “human footprint” on the environment while maintaining quality of life. A variety of technologies offer ways to minimize resource use, waste, and pollution while improving human welfare.

More on the New Marketing and Media Model

The traditional marketer/client – agency – media company structure is evolving into a significantly different ecosystem that is more complex and, no surprise, increasingly digital.  As the overall media environment changes, the current marketing agenda and delivery capabilities must be re-imagined, driving unprecedented rate of change in marketing organizations, agencies and media companies.  That is the finding of Booz Allen’s “Marketing Media Ecosystem 2010 (MME 2010),” a cross-industry study that details how marketers and their agencies must change as the convergence of media and technology, combined with the fragmentation and personalization of media, changes the connection between marketers and end users.

What is clear from the study is that marketing fundamentals have not changed, but the strategies, investments and capabilities required to succeed in marketing have shifted. In the new world of marketing, the agile and flexible are more likely to become and remain successful than those enterprises tied to the old ways of connecting with the marketplace.