Subba’s Serendipitous moments

April 26, 2010

The push and pull models – Not business models, but a mindset!

Filed under: Business,Innovation,Perspective — Subbaraman Iyer @ 6:08 pm
Tags: , , , , , ,

 

A good friend of mine who is a regular reader of my blog and keeps asking me what’s serendipity got to do with what I write sent me the blog post which published extracts of the new book by John Seely Brown and John Hagel III titled The Power of Pull. The extract mentions the role of serendipity in creating new paradigms;which was one of the reasons why the blog post was sent to me.

I have been mulling over the push and pull models for several years. Apart from what is mentioned in the blog post, I reckon the following:

A push based thinking is at best an eclectic  mix of intellectual sloth and arrogance. It starts with the premise that the “pusher” knows what it is in the best interest for the recipient. Push further accentuates the efficiency syndrome and believes that the right mechanisms and triggers will ensure success. It invariably tends to replicate the past, making just minor tweaks to current environment. The more different the reality, the greater is the research and more diligent is the design of the mechanisms and “push” messages. The arrogance of the past success ensures that they remain in continuous denial about the new world and push outmoded things with greater vigor. The perpetuation of the past is sadly created by the elite at the top who often believe that they are the sole owners and arbiters of the reality. The role of conceiving and creating new offerings gets considerably devalued over time. Tactical thinking gains ascendancy often at the cost of strategic thinking and innovative approaches. Such thinking has led to a slow but sure decline and eventual death unless a radical thinking ensues.

A pull based thinking on the other hand forces people to be humble as they necessarily have to be clued to the environment and listen constantly. A pull based thinking essentially harnesses the power of many different entities and creates possibilities and scenarios that were not conceivable in the first place. It does create chaos and confusion, but slowly there’s a defining fluidity which lends itself to constant learning and innovation. Further a force of serendipity acts as a regular glue helping people make connections and improvisation. It is an open mindset that constantly calibrates itself.

Tell me a successful innovation or a major breakthrough and I can demonstrate how pull based thinking contributed to the phenomenon.

Sharing has becoming second nature (thanks to social networking and Facebook) in the world that we live in. Facebook’s open graph in fact is perhaps the biggest opportunity for pull based thinkers and marketers as they can participate in the conversation. It will force people to conceive not just value propositions but every attractive value propositions as they compete for attention in a rapidly attention deficit mental state. The digital native should have had a natural advantage here. Yet most digital natives are content with pulling data and information from the Web and not creating value out of them. Worse still, many impose their own pull based thinking into this push based environment and are none the wiser.

Hence I am tempted to conclude that notwithstanding the environment it is one’s thinking model that needs examination and scrutiny.

While the sort of pull based thinking described above is externally directed, there is an internally directed pull based thinking that is equally potent. It transforms passive observers and learners into performers. I have often noticed that pull based thinkers are natural performers as they constantly attempt to pull new information, concepts and thinking into something meaningful to them. All that is needed is persistence, the willingness to experiment and occasionally fail and constantly call upon themselves to be curious and seek out new things.

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October 2, 2009

Cisco’s brilliant acquisition of Tandberg

Recent acquisitions by Dell and Xerox have something in common. Both acquired companies which are far away from their core competencies in an effort to find stable growth. They acquired predominantly U.S. centric IT services firms. I explained my disappointment with Dell’s acquisition of Perot Systems here. Xerox recent acquisition of ACS also evoked a similar thinking in me. It is very difficult for a pure play product / technology organization to blend well with a pure play services organization. The organizational DNA are too different, growth trajectories are quite different, organizational processes lend itself to little synergy. In short, I am not very high on such acquisition moves.

Cisco is different.

Cisco announced an all- cash offer to acquire Tandberg for $ 3 billion. Tandberg — a Norwegian company sells smaller and less priced video conferencing systems. This is a perfect fit for Cisco’s more expensive TelePresence systems which has been a great success. I think this is a brilliant acquisition since Tandberg’s gross margins is 66% and has clients in US and Europe. This acquisition would enable Cisco to sell the Tandberg products to companies which cannot afford the TelePresence. With this acquisition, Cisco would dominate the video conferencing systems for some time. More importantly the acquisition came in quite cheap since Cisco just paid 11% premium over Tandberg’s closing price.

Cisco has always acquired companies that in some way or the other generated more Internet traffic creating in turn demand for its core business — the networking hardware business. The way it is going to unleash its Unified Computing strategy will of course be interesting and one has to wait and see how it provides the synergy to the networking hardware business. Cisco’s ability to shake off entrenched players in fairly established market segments will also be evident in a couple of years.

Over the last 5 years Cisco has acquired 40 companies — both big and small and they have helped Cisco plug the gaps in the technology and product roadmaps admirably well. They also have had little problems integrating them into the Cisco model.

Cisco has $35 billion in cash which means further acquisitions are on the way. I only hope they don’t go with the flavor of the month and acquire another U.S. based IT services firms !

September 30, 2009

Vodafone takes the battle to the mobile phone vendors

A few months back one of analyst friends asked me whether it is possible for the mobile service provider to create their own App Stores and be successful. My opinion to him was they can do it or rather they should do it, else they have not even joined the battle for customer loyalty. The talk turned to Singtel which is one of the largest operator based out of Singapore and it has a global presence due to its joint ventures and acquisitions in many countries. I remember telling him that it should be one of the large operators who will have the reason to do it.

Now Vodafone has done it. Vodafone 360 is a mobile web service that provides music downloads, integration with Facebook and Twitter, and supports several handsets. In a way it is competing with Apple’s App Store, Nokia’s Ovi and other App Stores created by the mobile phone vendors.

Now Vodafone’s Telco 2.0 model (called efficient pipes) is nothing new. A lot of mobile service providers thought about that but shied away from taking the plunge. Now Vodaphone which has over 300 million consumers in over 30 countries has taken the challenge.

As Apple and Nokia increase their emphasis on the App Store and have made a success of it (Apple’s App Store’s success is chronicled here), the mobile service providers can’t afford to be silent spectators.

But whether the service providers with their current competencies would have the ability to build an App store and an application eco-system is a big question.

September 23, 2009

Netflix’s “crowdsourcing” approach is a success

I have been following Netflix unique experiment to improve its Web site’s movie recommendation system. This week Netflix announced the winner of a three year contest with the winner BellKore comprising of statisticians, computer scientists, data mining experts netting a cool million dollars.

The rules of the competition was fairly straightforward. The qualification for the prize was that the winning team has to improve by at least 10% the prediction of what movies customers would like as measured against the actual ratings. The teams were grappling with a huge data set of more than 100 million movie ratings.

Over the past three years there have been 44,014 entries from 5,169 teams in 186 countries vying for the top prize

I think with this experiment and with Google’s experiment with crowdsourcing described here, there will be a significant shift towards innovation management. The fact that there exists more intelligence and wisdom and the collective effort outside the company’s eco-system has gained credibility. I expect many such organizations embarking on the contest mode to solve intractable problems.

There are a number of lessons that this contest brings about.

First, it indicates that there can be a marketplace for innovation where companies could post their product development challenges and for an interesting contest, the best brains are willing to compete. It sharpens their own abilities.

Second as the BellKore team and other teams demonstrated there is a willingness for disparate people to actively collaborate. While cooperation and collaboration within many organizations has been challenging, I wonder how such disparate people could come together and collaborate easily for a bigger goal.

Third, for people who believed in having an inhouse R&D and saw that as a competitive advantage, this experiment seeks to blow that myth away.

Note: Netflix Prize 2 would challenge competitors to recommend movies based on demographic and behavioral data.

September 20, 2009

How to find meaning?

Last week as I was involved in a deep discussion with a good friend of mine, (I also happened to coach him in a difficult professional transition) I had an epiphany. He asked me whether I found the meaning of life.

The question was sudden without any preamble and as he looked deeply in my eyes, I discovered that I have been in a similar quest perhaps all my life. I only don’t know whether I have finished finding the meaning of my own existence.

Meaning is not something that you find as you normally try to find a location in a map. It is not something that you look for as you would for an item in a supermarket.

It is something that one has to build in one’s life. The elements to build it is already there in one’s consciousness. It is built out of one’s own past, out of one’s own talent and aspirations for oneself. It is based on the values that one has developed and what one stand for. It is based on the things that one believes in and out of the things that one cares about in a deep sense.

Now, each of us have to take the elements and combine that into a unique pattern that will resonate with oneself. The discovery of that unique pattern could take years. Once discovered, it becomes precious.

Meaning guides a person and sometimes becomes the raison d’être for one’s existence. It is nourishing and provides the dignity to one’s life.

I also discovered a strange connection between the outcomes of events and the meaning of life. A material success which doesn’t resonate with the meaning in one’s life seems hollow, superficial and doesn’t give much joy. A success that’s congruent with one’s meaning in life gives fulfillment.

Has anyone else found meaning of life? How did you all find it?

I would be curious to know.

September 10, 2009

Steve Jobs with a new liver and astounding numbers.

Steve is back with a new liver. He’s back and his unexpected presence at the Apple event got him a long standing ovation. He mentioned that he now had the liver of a person in their mid-20s who died in a car crash. He talked about the significance of organ donation. He ended by telling everyone to think about organ donation, as it saved his life.

That’s wonderful Steve. But would you create a charity organization for organ failures, do something to encourage more organ donation and set an example. When can we see Steve the philanthropist?

That way Steve you would have put your wealth, creativity, charisma and presence to a great cause.

Steve went on to mention Apple’s great successes:

iPhone:

30 million iPhone have now been sold worldwide in a little over 2 years.

There are now over 75,000 apps in the App Store

There have now been some 1.8 billion App Store downloads

The 3.1 update for iPhone and iPod touch will launch today.

iTunes:

     iTunes is now the #1 music retailer in the world

     8.5 billion songs have been downloaded from iTunes

  There are now 100 M accounts on iTunes, making it one of the largest stores on the web

     iTunes 9 is launching today, with a revamped look and feel

     An easier way to organize apps on the iPhone and iPod touch

     iTunes LPs (this is the “Cocktail” feature)

iPod:

     Apple has sold over 220 million iPods to date

     It’s one of the most successful products in history

     In the U.S., the iPod has 73.8% market share

     The next biggest MP3 player is “other” with 18%

     “Microsoft pulling in the rear with just about 1%”

     There have been over 20 million iPod touches sold.

     So combined that’s 50 million iPhones and iPod touches.

     21,178 games and entertainment titles in the App Store now

     Compare that to 3,680 on the Nintendo DS and 607 on the Sony PSP

Amazing mind blowing results and again Steve at this best !

September 1, 2009

At Telstra you get a bonus for delayed IT projects

Welcome to the Telstra’s compensation model.

Greg Winn, the Sol Trujillo-appointed chief operating officer of Telstra until February 2009, was paid a bonus of $2.2 million for outcomes related to the delivery of the carrier’s IT transformation, which has since been revealed to be running $200 million over budget. Read the details here.

What’s interesting is that despite it running over $200 million over budget ( the project was supposed to save $100 million a year in IT expenses), the CIO feels satisfied that many of the objectives of the five year transformation was achieved.

David Thodey — the Telstra’s CEO believes a $200 million overspend should be considered a good result, considering the awful experiences other industries have had attempting an IT transformation.

“I do not know of a better IT transformation,” he said. “I’ve never seen a transformation come in that well.”

I am wondering if this is Telstra’s compensation policy and if I can get a job there. I am also curious to study Telstra’s goal setting methods, budgeting process and their compensation model.

Last year, I was advising a IT services firm on the strategy approach to managing a business transformation program for one of their clients. Knowing the risk of such a program and the various dependencies, there was a discussion of how the compensation structure for the team should be built. While I didn’t have a hand at making the final recommendation, the consensus was that the bonus scheme should be weighted in favor of the benefits realization proposition. Benefits in this case was actual cost savings and hence the cost savings need to be computed, independently verified, communicated to the client who has to accept it. Only then could the bonuses be paid.

Ironically, the IT services firm has Telstra as one of their large accounts. I hope they don’t adopt the Telstra model.

August 20, 2009

How to build a successful innovation team?

Recently I delivered a talk on business innovation. My main thesis was why that offers a competitive advantage and offers the best barrier to entry. There were interesting questions, but the question that flummoxed me was asked by a young MBA student and it went as follows: How to build a successful innovation team?

Not having worked in R&D or an innovation team, I had to admit my ignorance. I promised that I will think about it and revert. I asked several HR managers, consultants and even some innovation experts. I was not satisfied with most of the responses because they talked about examining past track records, achievements and so on. That doesn’t say much and I don’t necessarily agree with experience being a true predictor.. So here’s what I have come up with:

  • Hire someone who doesn’t care much for stability, hierarchy, order and predictability. Every problem is unique and will need a different thinking approach.
  • Find someone who appreciates and thrives on ambiguity. Ambiguity often has negative connotations, but to me to be able to appreciate the grey area and to live in the mental conflict zone is key to finding the breakthrough.
  • A deep competency is good, but the person should be genuinely interested in other things. It is when you are looking at something else with genuine interest, a serendipity play converts the competency to a breakthrough.
  • Have the ability to “abstractize” a practical problem and see a practical problem and hence an opportunity in an abstract thought. This calls for people who can have their feet on the ground and the head in the cloud and span the space between them.
  • Finally and I think this is the most important: The last thing a team needs is finding another clone. Stop looking for something similar to what you already have. You need to fill gaps that are in your team and complement the competency and hence the more of the same doesn’t always make it successful.

(I am assuming that there exists some amount of passion, enthusiasm, respect for people and inter-personal communication strengths.)

It would be difficult to expect all this in an individual. However collectively the team should have these qualities. Whether they become successful or not is a different question. It depends on the mindset and a whole range of factors. But at least you know that we have a good capable team of cracking a problem.

Does anyone have a competency model to build innovation teams?

August 3, 2009

Be yourself

“Tension is who you think you should be. Relaxation is who you are.” — Chinese proverb.

I can’t think of a more simple, yet a deep truth. I was discussing my earlier blog post with 2 of my friends. Both believed that to be successful one should adapt, which means constantly changing oneself to circumstances. And if one has to change, one has to let go one’s true self. I will write my response to their observations in a separate post, but for now, I just want to do a follow up post which hopefully should clarify my stance.

I think most of us have a tendency to sell ourselves in situations even when we faintly perceive that we are being evaluated or judged. We worry too much about who we think we should be, instead of just being who we are. We over-value what we aren’t and undervalue what we are.

Regardless of where, when, or why of any situation, we should always be ourselves. I am specifically referring to a staying true to one’s principles and faith. The challenging part of this that there will be times when we need to challenge ourselves from a personality standpoint. We cannot just say, “Well, that’s the way, I am”. We all have such opportunities to challenge ourselves in matters of ability, growth, mental models and even beliefs. I say this with a smirk because I can tell from experience that it isn’t easy, though it may sound so.

People miss the amazing leverage that can come into play when they do buy into their vision for their own life and determining what’s preventing themselves from achieving it.

Death isn’t the greatest loss in life. The greatest loss is what dies inside of us while we live.

August 2, 2009

Underdogs can win

Underdogs win more times than we think, but is there a set approach that characterizes their win? I have always been intrigued by their winning approaches and the tipping points that gives them the decisive competitive advantage.

Having delved into business strategy research and practice for a while, I still couldn’t come across any clear framework that advises underdogs of how to take the battle against the more powerful opponent.

Malcom Gladwell (author of The Tipping Point, Blink and the more recent Outliers) writes a brilliant piece on how David can beat Goliath. The article is a bit long, but it makes compelling and instructive reading. It has several brilliant anecdotes written in the typical Malcolm style. What is amazing is how Vivek Ranadive uses the principles of real time information processing and the way he built TIBCO — a hugely successful software company, to coach his daughter’s school basketball team for the National Junior Basketball championship. Vivek never played basketball, nor was he a coach, yet his astute assessment of the game’s dynamics and mapping out to the real time information processing and how TIBCO became successful shows what a smart mind can do given a challenge. Vivek is also the author of the bestseller: “The Power of Now: How winning companies sense and respond to change using real-time technology”

Malcolm also draws from various other examples in sports, conventional wars to illustrate the following principles:

  1. First acknowledge your weakness and then choose an unconventional strategy.
  2. Choose not to play by Goliath’s rules.
  3. Be bold and do what could be even termed as “socially horrifying”— challenge the conventions about how battles are supposed to be fought.
  4. Do not be scared of being disapproved by the insider.
  5. Believe in the fact that a defender’s dilemma is very often the attacker’s advantage.


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