Are you, or want to be, a game changer? Do you use the power of your ideas and connections to grow and change? Watch Nilofer Merchant, strategist and author,” in one minute tell Harvard how the way we do business is changing:
We don’t create value on our own but when we connect with other entities, people and ideas. People who master networking will be thriving in the social era.
The power of networks
How many networks do you belong to on and offline? Admittedly far from all networks are useful. They have to consist of people with shared interests and goals in order to produce returns and serve our needs.
Unfortunately there are plenty of networks consisting of individuals who just talk and seem to be stuck on the same treadmill forever. Such networks, needless to say, will not produce results. When it comes to networking, action definitely speaks louder than words.
Connected individuals taking over from institutions
It’s almost strange, isn’t it, that power today more and more comes from individuals connected in some way at the expense of institutions. Personally believe that’s a wonderful development. And it gets even better because because we can create value by connecting to individuals who are not working in our company. We can, for instance, hire a consultant at the other side of the world who can carry out work for us without leaving his/her home.
Let your customers have their say
Making your customers part of your innovation process is a wonderful aspect of the social era. How do you connect with your customers?
It’s also interesting that it’s mainly our values and goals that unite us in the social era. Not a company or product. It allows us to organise companies to be more fluid, work faster and increase their market share.
Isn’t it time to stop thinking in old ways and adapt to our new reality – the social era? We don’t need to work out of an office anymore. Maybe it’s time to to re-define what an organisation looks like and how it is structured? More and more individuals have their own company and successfully cooperate with other business owners as if they were one organisation. Do you agree that the amount of business owners working together along those lines will continue to increase? Are you operating that way? If so, what are your experiences?
For decades governments that dared to challenge the IMF model swiftly found themselves out of favor in Washington and other Western capitals.
Capital inflows are not always beneficial for a country, the IMF concludes.
But the financial crisis that started in 2008 prompted a new debate over free market policies and IMF ideology. So now after sixty years of zealously insisting on free market economic policies, the International Monetary Fund has traded its dogmatism for pragmatism, it seems.
IMF admits mistakes
It recently admitted that their policies for bailing out Greece has caused a lot of damage to the country. The IMF estimated that unemployment would go as high as 14% but it has now gone as high as 27%.
Capital controls cab be beneficial
The IMF has acknowledged that in some instances, developing countries might actually benefit from controlling how much foreign capital enters their economies — and how it’s used. After examining the experience of governments that have regulated capital flows, the IMF concluded that such policies helped reduce “financial fragility.
There is no surefire one-size-fits-all way to deal with the impact of potentially destabilizing short-term capital inflows. While controls can be helpful to individual countries under certain conditions, their widespread use could have deleterious effects on the efficient allocation of investment across countries, and harm prospects for global recovery and growth.
Glad to note that the IMF seems to have adapted a more flexible approach. Governments all over the world have complained to me about the inflexibility of the institution. Maybe in this respect something good came out of the global crisis? Plans are important, but we always have to be flexible about how to reach our goals. Do you think the new IMF flexibility will have a positive impact on global recovery and growth? Or is it just temporary and sooner or later they will become dogmatic again? Maybe it’s actually your opinion that all countries should stick to free market policies no matter what? Even when, as in Greece and Spain, unemployment hits 27 %? Photo: Flickr – businesspictures
Of course you would. You would actually want to read it immediately. And your customers are no different from you.
Women contemplating what different beauty products will do for them. What woman would buy a product that she believes would make her look ugly?
What’s the main interest of a customer? Or let me re-phrase the question. What’s your main interest? You know the answer. Yourself. Sounds terrible I know, but all human beings have an interest in what happens in their lives. Be honest, so do you. That doesn’t mean that you are selfish. What would your life be like today if you hadn’t taken an interest in it? No need to say more, is there.
Your customers are also interested in what happens in their lives and how you, your products and services could have a positive impact on them and their lives. Still it is sometimes overlooked.
Marketing is about what your customer wants
If you can show your customer what you can do for them you will not have to do any selling. They will buy. In fact they want to feel they made a purchase, not that you have sold them something. In other words, let the customer feel that they had the idea.
Keep that in mind when you produce you promotional material. Focusing on the customer is, and always has been, the key to successful marketing. It does not matter what you need or want to tell them since the customers priority is what they, not you, need or want. Usually there is no need to tell them bluntly what you can do, there are more subtle ways to get the message across. Ideally they will get the impression that you are sympathetic with their ideas and desires and care about them. It’s not for nothing cosmetics companies sign up beautiful celebrities to promote their products.
Customers want you to care about them
They don’t care that you are very proud about your new office or that you have launched an exciting new product. However, if you invite them to a party at the new office or give them a sample of the new product, they will be interested. Even better if you can show them how your new product will make them more attractive to the opposite sex.
Customers don’t care if your company has had the most successful year ever, unless it has a positive impact on them. You get the drift. Your customers thinks about themselves when they read your advertisement. No need to tell them all the positive aspects of your company, just focus on what impact you can have on their lives and they will be interested. Make them feel happy doing what you would like them to do i.e. lead instead of command.
If they don’t see the positive impact you can have on them and their lives, you are on the wrong track . It’s time to adjust your promotional material to make them see the advantages and purchase. Needless to say, their purchase will be a one off if your products/services don’t have the impact on them that they would like. Or to re-phrase it, if you didn’t like the article written about you, would you be happy with the newspaper that published it?
Everything and everyone is a product. A country, city, company, product, service and a person. And how the market perceives the product determines its value. It’s sounds cynic, I know. But if you want to be valued and sought for on the market you have to on a continuous basis make sure your brand is in demand and sells.
Does Chanel have a higher turnover in the developing world than in the West? Most likely. But since it’s a private company the information is not available.
Innovating and updating your brand
When a product is a success all of a sudden the brand matures, growth slows and it comes under pressure from competitors. Europe and the US at the moment are good examples. That’s the time to start innovating and spending again if you want to defend your market position. If not, don’t complain if you lose out to your competitors.
Nothing ever stays the same – not even Cornflakes
You may object that some brands, like Cornflakes, or Chanel for that matter, have been around for a long time. But what we buy today is very different from the same product 50 years ago, not least when it comes to packaging and design. If your brand is out of date you will have to make an investment and innovate yourself. How you want to be perceived depends on what market you are aiming for.
The West needs to get their attraction back
When it comes to countries and continents, Europe and the US have matured and competitors are moving in. But the West seem to take their current status for granted and are not doing enough to defend their market position. What happened to innovation and making their markets more attractive to investors, not to mention more business friendly?
The West is losing out
The market is irrevocably global. That does not mean the concept represent the best of worlds. But the West will continue to lose relative power as a result. It’s ironic isn’t it that thanks to its generosity in exporting the secrets of success, China and other emerging giants are catching up.
Developing nations are not going to cede power to the US and Europe out of gratefulness. So the West needs to face up to reality – their brand is losing out. It’s time to innovate and make it profitable for businesses again to stop them moving to other parts of the world. If not, the West will gradually trade places with the developing world.
No matter how smart we are, as entrepreneurs what we have on day one is a faith based enterprise. Devote one minute and forty two seconds to hear what Steve Blank, serial entrepreneur and Stanford consulting professor, has to say about swiftly turning your vision into a sustainable business model:
Startups are, to quote Blank, religious enterprises. Catch is 95% of the time entrepreneurial visions are hallucinations. And as we all know, entrepreneurial minds are prone to have ideas the world is not yet ready for. It’s hence of essence to make sure we are not ahead of time. Or simply have an idea the market does not want.
So how do entrepreneurs swiftly find out if they are hallucinating?
Steve Blank’s suggestion is to break down the vision into a business model. Then get out in a fairly formal way and test your hypothesis with your customers.
Why should we test our visions?
Because we are not smarter than the collective opinion of our customers, is Steve Blank’s answer. And he is definitely right about that.
If we find out that we are wrong we then make minor changes or, if necessary, a pivot, i.e. a substantial change, to one or more of the business model components. Then we keep on making minor changes or pivots until we have a sustainable business model.
The alternative is to passionately go ahead and try to make an idea that’s not sustainable succeed. Far too many entrepreneurs make that mistake. Some even go bankrupt as a result. Probably most frustration is caused by having ideas that the market isn’t yet ready for. Not least because someone else will launch it in the future. Testing your hypothesis enables you to wait until the timing is right and do something else in the meantime. Or, if possible, gradually launch your idea.
Do you agree with Steve Blank that 95% of the time entrepreneurs are hallucinating? Is it essential to go out and test your hypotheses with your customers? Have you ever tested your visions the way Blank suggests? If so, did you make changes the way he recommends and ended up with a sustainable business model? After hearing what he has to say, will you now go out and test your hypothesis and then make the changes necessary? Or are you of the opinion that the vision you believe in will succeed, provided that you work hard at it?
Empathetic leaders are in high demand in the US. In the Nordic countries however, where empathy is an aspect of leadership, the debate is instead if leaders have become too compassionate.
How empathetic should a leader be? Will future leaders be compassionate or firm?
Is the grass always greener on the other side?
It seems you can’t win. Isn’t it interesting that when empathetic leadership is the norm, it’s benefits are being questioned while in countries with less considerate leadership styles it’s considered ideal? Some Americans even go as far as stating that the era of empathy is upon us.
Empathy a handicap?
In the Nordic countries empathy has long been part of management. Leaders have had to be considerate, weather they wanted to or not. Now however, some Scandinavians argue that being considerate is a weakness because it makes it hard to be firm and take tough decisions.
The ideal US boss is empathetic
Harvard Business Review concluded that empathy is high currency for a leader as is softer and more compassionate leadership styles. When it comes to CEOs being considerate, understanding and sympathise with employees and their feelings is considered optimal.
If you google empathic leader and empathetic leadership you get about 6,500 hits. And in general they are about leaders needing to be more considerate. The author Daniel Pink in his book “A whole new mind” writes that in the future empathy will be crucial for success.
Scandinavia a step further?
So have Sweden and Norway with their generally speaking more empathetic leaders taken the debate a step further by questioning if it’s a handicap? Or is it a step back to question if leadership have become to considerate?
Some claim that considerate leaders worry too much and can even be negatively affected by their environment as a result. If so, does that handicap them as leaders?
It’s common sense that leadership is facilitated by compassion. But taking the current debate in Scandinavia into account, maybe empathy combined with an ability to take tough decisions when necessary is ideal?
Most leaders either adopt a persona that’s excessively tough or overly empathetic, or feared or loved, if you like. Obviously neither leadership style is ideal. Maybe a leader focusing on helping other people to achieve their full potential would be best? A happy medium is obviously the ultimate but how many leaders are both compassionate and tough?
Do you believe empathy is an asset or a handicap for a leader? Will we see more empathetic leaders in the future? If so, will the considerate trend then, like in Scandinavia, be questioned because such leaders worry too much which has a negative effect on their ability to manage? What lies ahead for leadership? Will it, like it always has and still is, be a mix of different kinds of leadership styles? Empathetic – to be or not to be – that’s the question leaders have to ask themselves. Or maybe the debate about the ideal leader has gone to far? The different debates going on in the US and Nordic countries certainly makes you wonder, doesn’t it? Maybe it’s time to accept that leaders are different and empathy works for some and not for others?
The professor has seen firsthand what happens when professionals jump to conclusions and rush to action.
Successful leaders frequently are into diagnostic thinking i.e. when they look at a problem they don’t go straight from problem to solution.
Three steps
Astute leaders, and all human beings for that matter, ideally diagnose before deciding on a cure. That makes it three steps; problem, diagnose and then solution. Professor Gulati is right when he says that it sounds obvious. But unfortunately it’s so common to focus on swift action nowadays many people jump the gun and rapidly implement a solution, for better or for worse.
Don’t think there is anyone reading this that has never skipped the diagnostic step. It happens to all of us because we are in a hurry or pressure is put on us to come up with something asap. The current focus on short term profits makes it inevitable that we sometimes rush. Consequently solutions that that are not well thought through are implemented.
Find looking at diagnostic thinking a good complement to Do you find time for strategic thinking? It’s another way of looking at strategic thinking or a complement, if you wish. There are people out there who consider themselves strategic thinkers that always move swiftly from problem to solution, without bothering to make a diagnosis. Hopefully this will give them food for thought?
Do you diagnose before implementing a solution? Has it happened that you swiftly implemented solution without diagnosing the problem? Would it be better if focus was on long term profits and there was time for diagnostic thinking? Or are you of the opinion that the diagnostic step only make the process take longer and should hence be avoided?
Former British Prime Minister Tony Blair was adviced by Bill Clinton to schedule time to think strategically on a regular basis. Watch this short video of him talking to Garth Saloner, Dean of Stanford Graduate School of Business, about Clinton’s advice:
What Tony Blair has to say applies to all of us, no matter what we are doing. Not least when we run our own businesses. It’s easy to devote all our time to dealing with day to day business and forget about how to reach our goals.
Have events taken over your life?
If so, you are not alone. Apparently most people in high positions spend less than 5% of their time dealing with their priorities. Above all we lose our grip on strategies when dealing with a crisis.
Did Bill Clinton give Tony Blair good advice? Do you schedule time for strategic thinking on how to succeed with your priorities? Is finding time to do so hard? Have you noticed what a difference it makes when you find time for strategic thinking? Have not done so yet, maybe it’s time you do?
Well you can. And it’s not expensive. Watch this short video of Michael Kofsky talk to Keller Rinaudo, CEO of Romotive about their smartphone robot:
Talk about innovation. Until now a robot would have cost you somewhere between $10-50k. But now all you need is a smartphone and $150.
Do you need a robot?
So the big question is do you need a robot? Do you need to increased automation on an assembly line, a drone, explore the site of a nuclear disaster, enter active volcanoes or perform completely sterile surgeries from a location far from the operating room? Maybe for your business but most likely not in your private life.
In your home a robot can actually do the housekeeping, clean the pool, iron your clothes, entertain your kids, massage you and bring coffee to your guests. Maybe the smartphone robot isn’t yet able to do that. But in the future we are bound to find cheap robots that can do all that an expensive robot can do today.
Do you believe the smartphone robot is a sign of the future of robotics? Would you like to have a robot? At home or at work? Do you like this kind of innovations? Could robots take over more of what human beings do today? Is this a good development? A bit of Catch 22, isn’t it? Am all for it, but if robots, and other technologies, take over more and more tasks human beings currently do, what will be left for us to do? Imagine if robots take over what maids and cleaners do today on a world-wide scale. A huge section of humanity would be made redundant. And how would we create other jobs for them? Or maybe robots will create jobs?
No, it’s not a joke. The Economist were debating if the economy would be better off without MBAs. Have some fun and watch, or rather read, this short video on opinions voiced in their recent debate:
The video speaks for itself and looks at both sides of the coin.
Needless to say the debate took place because MBAs are blamed for calculating financial instruments that contributed to, or caused, the financial crisis.
Do you agree with the The Economist and Bloomberg Businessweek that it’s 50-50 if an MBA makes a difference or not? Or are you of the opinion that MBAs are good for the economy? Or do they harm it? Would we have avoided the recent financial crash if MBAs had not made faulty calculations? Or would it have happened anyway? Maybe a bit later? Should companies keep a close eye on MBA students straight out of university to avoid faulty calculations? Or should they be allowed to be as innovative as possible?
