thingamy

attraction and seduction

This is a mail exchange with my marketing friend John that turned into a co-blog-post about marketing, in particular about my incessant protesting anything "push":

In essence it all boils down to what Hugh would have termed - "Having a totally fucking amazing product is Job One" - that's the start and the end.

To which John rightly goes - "once you have created this totally amazing thing you can't just sit back and wait for the pull to happen, you have to ensure that the pullers become aware of it  and that must involve an element of pushing."

But how to nudge? Can the nudging be pull or push too?

Being a lazy bloke I obviously love being seduced by war paint, deep cut front, high heels... etc. but:

• Seduction could lead to mutterings of "oh shit!" the next morning... I've heard.
• Seduction is "push".
• Seduction seldom leads to marriage.
• Attraction is "pull".
• Attraction takes more time.
• Being attracted is enjoyable too, but lasts longer.
• Attraction is best path to a long lasting relationship.
• Seduction requires much lip gloss, deep cut fronts, high heels...
• Attraction requires transparency, allow all to be seen - warts too.

But, as John puts it, even attracting means that you have to be there, nothing happens if you hide in a corner!

Seduction (if done right) is quick and cheap, attraction takes time... guess that's why tinkering with enterprise software is harder than doing web 2.0 flashy stuff. Ah, the lack of natural curves and lip gloss... sigh.

more on marketing, segmentation and SAP

In my last post my good friends hailing from the marketing "camp" of business rightly defended some aspects of marketing, so guys, sharpen your pencils while I naively do some market segmentation on behalf of SAP no less:

When at Sapphire we heard much about the SME products - A1S, B1, All-in-one - and almost every presentation included some segmentation of the market:
Small, medium, large.
Upper mid, lower mid, small.
I was almost waiting for lower, lower, mid upper SME market...

Then go read Brian Sommer's post discussing the "typical SAP customer" which pinpointed the obvious, they have the conservative types cornered.

Way back in August 05 I did a post on my very own market segmentation, so allow me to suggest an add on to SAP's...

...size segmentation pyramid:

The attitude upside-down segmentation pyramid:

Basically, here I give a hoot about size, or even thinking "firm". Only individuals in corporations. Theoretically OK unless your acquisition costs per customer is high, then of course many seats per customer is important.

My question would be, why should not acquisition cost per customer be the same for small and large? (Not talking implementation cost here, that's a variable and billable.)

You talk to one person. You lunch with one purchaser. You present for one or more, same Powerpoint. Why the difference? It's all about people and a person is singular, always.

And definitely so if you switch from push to pull, then there is no acquisition cost difference.

What now if the market, i.e. the people influencing new software installs, are drifting towards the more radical and risk willing attitude; wanting more flexibility and the possibility to stick their heads out trying new ways and differentiate themselves and their firm.

If that's only partly right the segmentation along the lines of "attitude" would trash the "size" segmentation. The latter only relevant for "acquisition cost" purposes, and not for "influence" issues.

I would obviously not suggest SAP ditching their current core market or go-to-market strategies, I would rather suggest they have a huge opportunity to increase their market through "targeting" (hear that guys?) the not-so-conservative population of business world wide with new very different products.
Not only tweaking the good-old for smaller buyers but actually do something crazy and radical on the side.
Coupled with "pull" (market-come instead of go-to-market) of course, keeping acquisition costs equal for big and small.

I'll bet that they even will find not-so-conservative influencers in very large organisations. I have met many of them, they're there, believe me. Go get'em now, even some large companies uses non-SAP products!

After all, the car industry knows well that a family of five might not only end up with a boring minivan. Dad might want a Porsche too... and one day he'll buy one if possible!

Three Schools of Marketing

I have enjoyed many discussions about products and marketing lately, and yesterday on a Skype call with Charlie, Dennis and David I said, "hang on, marketing is a mixed bag". Now I owe them an explanation, so here's a simplified take on three different schools of marketing:

1) The MBA

Aka. The Long and Incomprehensible paragraph approach - "Identify a subset of account in each vertical will be proactively covered and controlled by us".

"Go to market" is the rallying cry, market research, statistics and many meetings the tools. Design to avoid offending anybody, set clear goals like "37.8% of this subset of that segment using that channel in precisely 18.7 months".

Usual results: Exceedingly bland products, wrong target as nobody really understood questions asked by market research, but sometimes nice cup holders if applied to the automotive industry. And of course channel stuffing and similar to pretend the budgets had any value at all.

Example: Take a field trip to Detroit.

2) The Circus Act

Aka. This is A Cool Product, bugger the nay-sayers and let's have some fun.

"Wow" is the rallying cry, public stunts, good stories and extremely "cute" and confusing brochures the tools. Design so 90% hates you because then for sure 10% will love you, and that's better than 100% shrugging their shoulder. Budgets are for wimps.

Usual results: No usual results. Interesting products, some fly, some don't, and we the consumers are richer for it while some investors chew off their arms while others pop Champagne corks. And even burn-and-crash is entertaining to see, so the users win whatever the outcome.

Example: Renault when launching the first Twingo. Read any biography of Sir Richard Branson.

3) The conversation

Aka. I know my Cluetrain / Hughtrain or I'm blessed with absolutely no marketing theory whatever.

"Hello?" is the rallying cry, wikis, blogs, twitter, parties and anything social are the tools. Design with the users, spend much time in blind alleys but get there if you have enough time, funds and never used glue when building product.

Usual results: Like DIY projects; some I use all the time, some I liked to tinker with but never use. Successes and failures, but no crowd pleasing crash-and-burns as early pull-the-plug is easy.

Example: Take a field trip with your browser.

Big question - which is the best?

I think I would choose a hybrid of 2 and 3 - an "Interactive Circus Act", an "inspire and include" approach.

Which is your choice?

SAP Sapphire slightly longer note

Now with it all behind us, what is my take, what did I read between the lines, what not-so-humble summaries can be made?

Attitude to the world is first class. Self confidence is relaxed.
When discussing with the SAPpies sometimes you could hear, "let that be off record", no fuzz, no big rules, no preparation in what to do, say or not. And even board members (see the plural here) were straight shooters with no handlers being intrusive.

As in all companies, there was a distinct difference between "marketing"- and "engineering"-oriented folks, even as seen from the outside.
In one five minutes presentation I counted 14 "go to markets" between the "multichannel in each segment" and a mind blowing powerpoint point: "Identify a subset of account in each vertical will be proactively covered and controlled by us". Yep, definitely Dilbert that.

As in few companies, it seems that the "engineering" is still in the driver's seat.
After the (only one it was) distinctly marketing theory driven presentation I suggested that one should draw a parallel to the car industry - BMW and Porsche are engineer driven, GM is purely marketing DNA. Then you know the rest...
Yep, SAP seems to be an engineering and product (tangible) driven firm, while... you know who... seems to acquire and drive forward for more marketing oriented reasons.

Many products and initiatives over last few years now having been sorted out and focus now is to deliver and make it work.
Good or less, perfect or less, just get it done and do your best - a commendable attitude.

SME market is again in the crosshairs, three products has survived the effort internally that I suspect had more stuff in development that did not cut it.
Not an easy task, suddenly SAP will have to struggle with a large and diverse mass, perhaps that is the reason why "marketing" is a bit in the driver's seat in this area? Plan, target and push.
As can be expected, not what I would agree to as the best approach. At least for the S part of that market. Better would be to accept the power of the market, reread Cluetrain and throw it out there - the brand is well known, capability and quality not doubted, why not trust the new "smaller" products instead of making big plans for the exact numbers that will be delivered in x and y months? Design for flexibility and just do it I say.

At last "differentiation" (for the customers) has become important. Even Business Model Innovation was highlighted, that warmed my heart!
So I can stop bitching about "best practices" and how that often can result in copy of competitor's processes and thus no differentiation at all. But still the new attitude clashes a tad with A1S as that seems to be rather rigid for many good reasons.
When I see that dichotomy I cannot but conclude that A1S will be a stepping stone towards something more customisable - from SaaS to SaaCS would be a natural future step.

The theme of Sapphire was "Business At The Speed Of Change".
We bloggers might be too creative, or even quarrelsome, but that sentence was mangled and rearranged over and over again to much laughter without any of us really understanding what it means! Any suggestions out there?

SAP Sapphire short notes #5

One of my fellow bloggers at Sapphire, Michael Krigsman, is observant:

"The media setup at Sapphire in Vienna is interesting.

For the analysts and traditional media, there are rows of tables and chairs facing toward the front of a large room. This is a pretty formal setup, with lots of reporters and analysts doing their own thing.

On the other hand, the “blogger’s corner” is arranged quite differently. We are in another room, with tables set up two-deep in a single row. The bloggers sit on either side of this long table, facing each other, with power strips and network connections in the middle"

Thanks to Mike and Stacey (who organised it all), that really worked even if only Michael actually noticed!

And it's really true, the banter over the table was constant, ideas were exchanged, good quotes twittered, ideas spurred - blogging as conversation already at conception!

And I suspect that even non-bloggers who came over felt at home at the table, hey, a party!

[Bonus: Read Michael's Custom Code Over My Dead Body also when there!]

[Double Bonus: Live, now recorded, table ambiance here!

SAP Sapphire short notes #4

I am back to good old Côte d'Azur after three days at SAP Sapphire in Vienna.

What can I say, three days with nothing but software and business philosophy discussions, any better way to spend three days? Thanks again Stacey and Mike and all other SAP people who gave us time!

Very smart, utterly fun and enjoyable folks - excellent!

I'm even slightly "smarter" after it all, but above all, I've become a good friend of the house of SAP.

Won't even mention what a hoot it is to spend time with people like Dennis, Prashant, David, Thomas, Maggie, Bruno, James, Craig, Manoj, Charlie, Axel... wish I could tell all the good stories and describe all the laughs we had, but some stories will have to remain unbloggable I'm afraid ;-)

SAP Sapphire short notes #3

"Claus E. Heinrich has been a member of the Executive Board of SAP AG since 1996. He is responsible for the areas of quality management, internal SAP IT, and the management of all SAP Labs worldwide."

Thus the man to give us a background on SAP's globalisation - the why, what etc.

Claus' definition of a global firm - "seen as local, locally".

On why - "because Germany was too small, a long time ago".

On biggest issue - "many does not understand that globalisation is an opportunity".

On why New York being the Global Marketing head quarter - "New York is the best place for marketing".

(To which I must admit, perhaps when marketing was all about advertising, not so much in an emerging Cluetrain / Hughtrain era...)

On why Paris which houses many very central people and functions - "because some likes to live there".

Fair enough, and certainly a clue that globalisation at SAP is a distinct human process!

SAP Sapphire short notes #2

Being a guest of SAP is a taxing, but nevertheless an excellent experience.

Wall to wall meetings, keynotes, discussions and as a perfect cap, a party in one of Vienna's beautiful palaces, eh, museums.

Keynotes are of course slick, entertaining and helicopter view as should be. Smaller presentations gives more to put teeth into, but best are definitely one-on-ones or small groups. That's when you can ask the silly questions and really get under the skin of this company.

In the department of new products, the SME products, in particular the A1S was interesting. That would be their new SaaS offer for medium sized, sweet spot said to be 50 employees or over, companies.
And it seems to deliver all you need, and in a very user friendly manner. The website is see-try-buy oriented, me liked that a lot.

To meet price and efficiency requirement the offer is rather rigid, set what you need and off you go, not much you can customise thereafter.

In a sense this clashes a bit in the muddled brain of your's truly as Henning stressed the drift towards differentiation for their customers, obviously, as mentioned yesterday, an important requirement for having a strategy at all.

But, I suspect the A1S will evolve into some SaaCS one day! SaaCS being Software as a Customisable Service...

SAP Sapphire short notes #1

SAP Sapphire short notes #1 Monday started off with a keynote by Henning Kagermann. Good to sit back and listen to a real engineer / philosopher, not a word about "going to market" or "market segmentation".

(Wall Street Journal, take note, these guys are engineers - now go and compare Porsche/BMW with GM and we who's better, the engineer driven or the marketing driven ones!)

All about the stuff, stuff, stuff, and why and how.

Being here as a freely roaming silly questioner a couple of things stuck during the keynote - the things that got me "hmmm...ing".

Henning talked about the clear trend among users to go towards "differentiation", no more standard ways. Well, I like Porter's definition of Strategy - "What value are you to deliver to which customers and how are you going to be different?"

Thus, if not different, no strategy. And lo and behold that is more often the case than not. So upon time standards and "copy the others" is to be replaced with "differentiation". Good, good.

Duet was also demoed, quite convincing, a "change supplier" ad-hoc process was built on the fly for interaction with the core SAP system.

What hit me was, hang on a sec, "finding a new supplier" is first step in any real procurement process is it not? And then a sub process that you have to revisit time and again of course. So why ad-hoc then? Second part of that, ad-hoc is fine and dandy, and next time it'll be a bit different (being ad-hoc built), and third time...

Not to talk about the process not being able to be refined over time nor captured thus masses of knowledge and learning being lost, intellectual capital loss that is.
Obviously Duet is a top layer to the core systems, and addresses what I termed Practices earlier - but should not Practices be as important as the core processes? Much time and resources are used there, suspect most of your daily work time in fact. Think this should be captured better...

Off I go to next meeting, having fun as you can see. I do appreciate the initiative by SAP, letting us roam freely and ask silly questions!

organisational hierarchies in practice

Last few days have seen me in a practical mode, change of mobile supplier, flipping a three year car lease into a new one and then some more.

Admitting to having the car sales chap go through a few more loops than need be, but hey, he's been to Sales Boot Camp and used "Sir" in every damned sentence so what would you expect?
Long story short, close to closing I came to my senses, did not really want the car and mailed politely a no thank you.

Of course he called within a minute, sounding desperate, to which I said he had done a grand job but we really needed something else, please do not take it personally.

His response? "What shall I say to my boss??" in an increasingly desperate tone. Duh I say.

Then, mobile phones; after 15 support calls and five registered letters last three days, I gave up and walked over to a competing supplier.

[Note: My number is now +33 6 8887 9944]

Keen on new business, my request for five lines and phones was well received. All well until the seller found that he could not supply more than three, the next two had to wait until they've seen me performing payment-wise for a month or two.

I suggested giving him a check for 500 € so they could sleep well, but no, rule's a rule. And of course, all of the local suppliers follow the same rule, aka "Best Practices".

"Centralising decentralisation", another term for "Best Practices".

Of course the bosses in the hierarchies need this, how could they ever justify their positions if underlings actually took decisions all by themselves?

Of course this is inherent in the hierarchies, sometimes very rigid, sometimes not, but always lurking.

With some important results:
1) Inefficiency.
2) I'm left with the idea that the company (read "Brand") is "Stupid".
3) Boss fear is more important than pleasing a customer.

Now I'm just waiting for the first one to start hacking away at their organisational hierarchy, when I'll be their customer faster than they can spell profit.

Ten chaps (and girls) in a room, all knowing what all do, all doing what they're best at, no funny rules needed, no titles needed.
Then extended to thousands of employees...

That's why I tinker with thingamy. To enable the ten chaps-in-a-room modus operandi to be extended to thousands.

Bugger applications and software ROI and efficiency gains, nope, it's about making organisational hierarchies less important and making customers like me happy and car sales men productive and mobile phone services acceptable.

For the millionth time, awast ye scurvy hierarchies!

[UPDATE: Dennis reminded me that my mobile phone supplier actually has a service, that you have to pay for of course, where you have one number who can circumvent the stupid hierarchy and get things done!

Some Credit Card suppliers have something of the same for Gold or Black cards and so forth…

Default service is to punch my nose repeatedly, then have me pay to end the abuse and then calling that a real customer centric service… cheeky or what?]