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“It’s a Cash Cow”

26 February, 2010

“Cash cow” is a term I usually hear used somewhat sarcastically in reference to a high margin product. The expression itself is probably pretty old, but it’s adoption into business is about 40 years old and comes from a matrix produced by Boston Consulting Group in 1968.

It’s a 2 by 2 matrix, perhaps one of the first to be popularised by consultants, with decreasing market share on the x axis and increasing growth on the y axis, the four quadrants are then categorised as shown below.

matrix

Matrix showing the categorisation of products according to market share and growth

A star is a product with high growth and high market share, this is likely to be a new product. A company should invest in further development and marketing of this product.

A question mark indicates that a product has high growth but hasn’t really gained a sizable market share, it may be a new product. There is a risk that such a product could turn out to be a fad, or may be vulnerable to competition. A company must watch the question marks carefully and judge investment carefully as the product could evolve into a star, or fall into a dog.

A cow, often termed a cash cow, has high market share and and low growth. It’s likely to be a mature product in a mature market. A company should exploit the revenues from the products in the cow quadrant to finance the investments in the stars.

The dog is in the fourth quadrant, and refers to products that have low market share and low growth, they may be products that have reached the end of their life-cycle. Companies should not invest in these products directly unless there is an opportunity to re-invent the product and relaunch it. In general companies should cease production of products categorised as dogs as they will quickly become unprofitable.

Of course this is a simplification but it does

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Blog by phone

22 February, 2010

Making a podcast has never been easier, it’s now only a phone call away with ipadio. I was interviewed via ipadio in the lead-up to speaking at a conference earlier this month. It was easy for me all I had to do was pick up the phone! The podcasts are recorded and presented in their own little player, which includes an embed code which I can’t get to work in wordpress – but it looks like this.

The ipadio player

The ipadio player

Mark Smith, the CEO of ipadio was also a speaker at the conference and he had some great stories of how his clients are using ipadio, he spoke about the use made by Oxfam to broadcast updates on the role.

I got to talk to Mark in one of the breaks, and was really interested to hear how companies are using ipadio for business goals; Virgin media have used it to deliver mass interactive communication for their 20,000 employees, Melcrum used it to preview their speakers. But perhaps the most unexpected use was “one to none”, using ipadio with the automatic conversion to text notes so that field workers such as district nurses could “dictate” their case notes following a visit and get a text draft back saving them a lot of time.

it's good to talk

it's good to talk

We’ve avoided podcasts for the most part because good recordings and playing/streaming on our systems is tricky. But this takes all the headaches out of that. With a lot of change coming up this year this could be a great tool for us.

I’m pondering how we can use this; as Mark Smith said in his blog “One phone call is sometimes all it takes… It’s good to talk!”

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Drive

16 February, 2010

Book Review

Drive; The surprising truth about what motivates us

Daniel Pink

It’s not money.

Or rather above a fair wage paying more won’t get more creativity or better “right brained” work out of us, in fact our performance may go down.

This wasn’t entirely surprising, I’ve known for a long time that what motivates me to go to work and try harder is not the salary but the opportunities to learn, to make things better, and to solve problems. I’m sure other people have a similar pattern of motivation, and yet our whole management system is based on the idea of paying for performance.

Pink draws on a lot of behaviourial research and concludes that not only does increasing the reward have no effect on our motivation, it can decrease the performance. Rewards work when they’re connected to routine or mechanical work, but as soon as the work has an element of cognitive skill rewards destroy performance. There is, it seems, a mismatch between what science knows and what business does.

So what does motivate people in the creative and cognitive realms?

  • Mastery; gaining skill or knowledge, “the desire to get better and better at something that matters”
  • Autonomy; being in control how we work, “the freedom to great work is valuable”
  • Purpose; working towards a larger goal or wider good, “those who work in the service of some greater objective can achieve even more

Pink finishes the book by offering 9 strategies for individuals to get into “Drive” motivation from asking yourself “Was I better today than yesterday?” to taking a year long sabbatical to recharge and learn. He also offers 9 strategies to take your team or organisation into “Drive”, including using “now that” rather than “if then” rewards so that your team gets a reward as a celebration for achieving something, rather than holding out a reward on condition of something being achieved.

It’s a good read, full of ideas and humour, thought-provoking, practical and well written. He’s also a good speaker, and talked about some of the ideas behind “Drive” at TED, here’s the clip.

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Numbers Game

3 February, 2010

Pick a number

How many friends do you have?

According to Professor Dunbar the number must be 150 or less. His research apparently shows we can’t maintain more relationships or friends than that in real life, and our online behaviour reflects that. I don’t think anyone things that Ashton Kutcher has a deep relationship with his 4,400,000 Twitter followers, or that Kim Kardashian’s 720,000 Facebook friends are all that close. But 150 seems way low.

It turns out that the number is derived by watching other primates and correlating their social network size to the volume of the neocortex region of their brain, and extrapolating that for humans. The number arrived at was 148, or anything between 100 and 230. He then looked at the size of villages over history and contemporary networks and seem to observe a natural limit in that range.

It’s interesting from an organisational point of view, I have worked in organisations of very different sizes and know something Mintzberg’s theory on organisational design. I’ve seen how as organisations grow they tend to hit some sort of natural limit at around 200 people. One company I worked for at as it hit 280 staff found that suddenly policies  and processes were needed where informal structures used to work.

Another company I know of has structured their formation documents so that they will be forced to split once they get above 150, their company culture is so important to what they do and they know it would be so hard to maintain it above that number.

Company culture does link to size and organisational structure, and maintaining it – or surviving a transition – is vitial.

But there could be a lower limit, I spoke to a guy last week who works in an “adhocracy“, their company is growing raising concerns about maintaining the company culture as they grow; to twelve colleagues.

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Follow a Museum

1 February, 2010

Or rather #followamuseum. Today is Follow a Museum Day started by Museum Marketing.

A surprising number of museums are using twitter, certainly more than when I last looked into this for a presentation I gave in October, so today I created a twitter list of Dutch Museums so I can keep up with them. If you’re trying to find museums who tweet near you then followamuseum.com is the place to go.

It seems to have been a success, some museums made special offers for their new followers for example the Willet Holthuysen Museum, other museums (many!) thanked and welcomed their new followers, while the Afrika Museum thanked their followers and reported on the growth in their number of followers.

But there were some fails as well; not all museums reacted to the day, the fail whale for the Rijksmuseum. They’ve got 119 followers, but no tweets – not even one to thank those who started following them today.

A fail whale for the Rijksmuseum

Why start an account? If there is no strategy and no resources don’t go there.

Postscript: Thanks to @NickMoyes who pointed me to this tweet from Peter Gorgels who is the web manager at the Rijksmuseum. It seems their twitter account was hacked and it took around two months to get the account back – which they seem to have achieved on 29 January – although there are still no tweets on the account.

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The unchanging nature of leadership

1 February, 2010
A long line of leaders

A long line of leaders

“A leader is best when people barely know he exists, when his work is done, his aim fulfilled, they will say: we did it ourselves. “
Lao Tzu

“Reason and judgement are the qualities of a leader” – Tacitus

Lao Tzu, a Chinese philosopher, lived in the sixth century BCE, and Tacitus was a member of the senate in Rome in the first century CE. But both quotes still reflect our understanding of leadership. A number of the historical ideas come through in the modern (well, 1970s) concept of servant leadership.

But all of that was pre-internet, surely it’s all changed with the new tools that we use now? Watch what Tom Peters has to say on the subject.

more about “Leadership – In Theory”, posted with vodpod

image from wikimedia commons

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iPad; great innovation, bad name.

27 January, 2010

twitter trendy topics

So the iPad was finally announced after a run of rumours over the last month or two. It won’t be launched until March/April, but there’s already a fever of anticipation on twitter, with about 1000 tweets per minute.

As far as I can tell from the launch video the iPad = kindle + iTouch – iTunes wrapped up in Apple’s high design ethic.

There are already big theories about what it will do, including making higher education irrelevant. The scenario described is more or less using iPad as a tool for eLearning – but eLearning is already used in masses of university and executive education that I don’t see having a new tool as an obvious game changer. If Apple can get enough of the educational material online then perhaps it will transform educational publishing – that is not the same thing as higher education.

So what will it transform? It’s finally a competitor for Amazon’s best selling Kindle, and it’s priced to compete with Kindle, sort of. Kindle is at 259USD and the iPad starts at 499USD, there’s a quality difference and then there is the usual “apple premium”. So although Kindle has already developed a market share, and developed agreements with publishers to ensure a steady stream of new content, they might be pushed to improve the reading experience.

I suspect the transformation will hit the publishing industry and the web/design industries. Both will push the boundaries of current web design to create content – including video and apps – that will be worthy of the iPad – because it is a thing of beauty. The flow of content might follow the example I wrote about earlier this month regarding Digital Magazines.

There are issues, lots of them; some, like the lack of Flash and limited browser, can change relatively easily. But the biggest we-are-all-12-years-old-again issue is the name, calling this iPad just shows they have too many boys in their marketing department. Women immediately connect the name to menstrual pads (see list of twitter trending topics above). Ignominious start for something billed as “the best web surfing experience”.

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History via Twitter

27 January, 2010

The Guttenberg Tweet, from HistoricalTweets.com

There are lots of games or humour memes on twitter, my current favourite is “Historical Tweets“, and the above is one of my favourites of the favourites.

The basic premise is to encapsulate a historic moment in twitter’s 140 character limit, most, like this one, use the contrast of the historic moment and the modern technology to raise a laugh.

You can follow them on twitter, and you can submit your own attempt at a historical tweet.

Oh and there’s a book coming – but not until April 2010.

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Does Twittering Make You Happy?

21 January, 2010

The theme for tonight’s Social Media Club Amsterdam was “the influence of social networking on your level of happiness”.

The presentation came from Philip de Wulf of Het Leefritme Kenniscentrum (The Life-Rhythm Knowledge Centre – it does sound better in Dutch) who have researched this question.

They’ve come to some interesting conclusions; people who are happiest are either very involved in social media, or not at all involved. They haven’t yet researched why this might be, but one suggestion from the audience was that since happiness seems to come easiest to people who have control or autonomy in their lives perhaps these two groups show that – one by committing to social media, one by opting out.

There was an interesting discussion around the meaning of the word friend, which came about because “unfriend” was word of the year for 2009. The consensus seemed to be that this could only be the word of the year because social media has, in a sense, devalued the value of “friend”, and most people were clear that they would never “unfriend” a real friend in real life.

But almost everyone in the room saw real value in virtual friendships, with a couple of people commenting that at some point you may feel the drive to meet these real friends. I agree with both statements; last year I contributed to a wedding of a virtual friend who was stuck between visa limits, no job and no close family – I may never meet her. I also flew to Prague to meet up with 3 virtual friends.

Social Dimensions

Like all good consultants they have come up with a two-by-two matrix that neatly divides the world into four types – something like the graph at right.

Focused relators aren’t necessary lonely according the Philip de Wulf, just they focus on a smaller group of contacts. The virtual connectors are highly active online, but less visible as social at real world events. Traditional socials are active at real events, but not so active online. The group under discussion is the “new open socials” which was about 25% of the research subjects but about 90% of the audience.

The question was posed “will new open socials encounter a culture shock in the workplace?”. I’m not sure, even my company – a rather conservative financial services company – is trying to find ways to make work more 2.0, and for many roles I would see “new open socials” has having an advantage in new ways of hiring and working.

I think I’m probably in the group “new open socials” so I might be biased, but I find the social media tools fun to use in themselves and it has help me maintain and build relationships – sometimes across the world, through it I will see photos of my nephew when he arrives in summer, because of it I get to share the ideas on communication with quirky experts. So for me social media does contribute to my happiness.

So does twittering make you happy?

The third Social Media Club Amsterdam Meeting will take place on 17 February and registration is already open for it.

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Eat your own dog food

15 January, 2010
Lorne Greene advertising Alpo dog food

one of the original adverstisements

“We’ve got to eat our own dog food”

I’m not sure that I would eat dog food, even if I worked for a dog food company, so I find this saying a bit odd.

Apparently it comes from 1980’s ads when Lorne Greene made testimonial style ads (as shown on the right) although he never said that he ate the dog food himself. The source usually cited is the Microsoft email sent in 1988 entitled “Eating our own Dogfood” indicating that Microsoft should also use its own products.

It’s a good philosophy, for a start you gain experience of your own product from a client perspective – this should help you resolve bugs/service issues faster. It should also be a more cost effective choice over choosing an external supplier. The third reason, and the one generally meant by the phrase, is that you are proving your belief in your own products so it should be a reputation builder.

But dog food?

I think part of the reason this expression has gained ground is what I like to call the “gross out factor”. The idea of eating dog food is pretty off-putting so anyone that does so is really showing dedication.