http://newroadstorevenue.comQuick Blogcasthttp://newroadstorevenue.com/2010/02/26/the-hierarchy-of-powers-a-conversation-with-geoffrey-moore.aspx?ref=rssNotes from our HBS N. California Strategy & Growth Roundtable By: Adrian C. Ott In late January, I had the opportunity to co-host a fireside chat with Geoffrey Moore, a Silicon Valley thought leader and author of five business books including the classic, Crossing the Chasm. Geoffrey gave us a preview of his upcoming book and laid out his newest model which he calls the Hierarchy of Powers - a framework to organize the strategic conversation and decisions across organizations. Myself (L), Geoffrey Moore (C), and Stacy McCarthy (R) President of ASP, N. Calif.In his presentation, Geoffrey shared five levels in his Hierarchies of Power (in descending order): Category Power, Company Power, Market Power, Offer Power, and Program Power. He further discusses 3 Horizons for portfolio renewal: Horizon 1: 0 - 12 months, Current businesses, generates cash flow today Horizon 2: 12 - 36 months, High growth Businesses, needs resources Horizon 3: 36 - 72 months, Future high growth businesses Following are highlights from my Q&A with Geoffrey: Adrian: There are so many products on the market that are moving to a free pricing model and what you described in Horizon 1 and Horizon 2 implies that there are returns on investment. How does this model work from a free perspective? Geoffrey: Free works as a vehicle but not as an economic return so let’s just be clear. But the most obvious place it’s showing up was in the sort of the web models and so what the model said was, what chasm? We’re Facebook. We’ve got 230 million users...and what chasm? There was never any chasm. And the answer was no when you make a product free, you actually remove the adoption chasm or you can remove the adoption chasm but you haven’t removed the monetization chasm. So you’ve deferred the monetization problem so the reason why the chasm was there originally was monetization was never detached from the offer. Adrian: You say that Horizon 2 is challenged because it lacks the luster of Horizon 3 and doesn’t meet the cash contribution metrics for Horizon 1. What are some examples of successes in Horizon 2? Geoffrey: Look at what Apple did with the iPod. Pretty amazing because the category, the mp3 category, was really stagnant. Napster looked like there was some desire for digital distribution for free. There was some objections to that and so Steve was able to drive that through because he just championed it and drove it through. The telepresence one is one from Cisco which again was a very visionary thing. You had to make a room. It had to have all the stuff and how could you ever ...TechnologyStrategyInnovationGrowthAdrian Ott2010-02-27T23:04:00Zhttp://newroadstorevenue.com/2009/10/12/the-cofounder-of-netapp-speaks-on-business-growth-and-risk.aspx?ref=rssNotes from our Strategy & Growth Roundtable with Dave HitzBy: Adrian C. OttI had the opportunity to interview Dave Hitz, co-founder and Executive VP of NetApp recently for the Harvard Business School Association of Northern California's Strategy Roundtable. Dave is one of the few people on the planet that can say that he started and grew a business from zero to more than $3 billion today - quite an accomplishment. In addition, NetApp is an extraordinary company as it was rated at the #1 Best Company to Work for by Fortune Magazine in 2009. Dave provided incredible insights about his experience as an entrepreneur and the risks that come along with starting a business. Here are some the highlights of our conversation.When asked about taking risks to start a company, he advised:The risk of the upside failing is actually not that bad, it's the risk of the bad things on the downside that people should focus on instead. He gave an example of his decision to start NetApp instead of pursuing his MBA. His rationale was that to get an MBA you remove yourself from the workforce for two years and pay a lot of money to a school. After two years, you graduate and get a job; about the same upside you would get if you stayed in the workforce. (not a huge upside.)On the other hand, starting NetApp would also take him out of a paid position but the upside was huge. He surmised that if it didn't fly, the worst thing that could happen was that he would have lost some income and time out of a paid job. He could still return to a paying job. "But I would have learned a lot." Key point: the downside risk was not that bad, and the upside was huge. For anyone person thinking about or starting a business during a downturn, he said:"I have three words of advice that I think should be the guiding principle for somebody trying to get into business and the three words are: 'good enough considering'. I think a lot of customers out there, whatever it is they were thinking they would do, their plans are different and they are going to choose something that is 'good enough considering' instead of whatever they were going to choose." On hyper-growth, Dave said:"One of the things we learned in hyper-growth, it is next to impossible to install any kind of business process, business system, IT solution that was likely to last for 3 years and the reason for that was that most IT solutions are not designed to scale by a factor of ten. The difference between a ten million dollar company's processes, structure, business and a hundred million ...StrategyGrowthAdrian Ott2009-10-13T00:16:00Zhttp://newroadstorevenue.com/2009/08/08/how-microsoft-approaches-innovation.aspx?ref=rssNotes from our Strategy & Growth Roundtable with MicrosoftBy Adrian C. OttThe business phrase, “Build, Buy or Partner” has been an industry standard for decades, referring to the decision on how to strategically grow business. But as change is inevitable, the underlying interpretation of this phrase has also changed.Today, many large organizations say instead, “Build, Buy AND Partner.” Large organizations of today manage a portfolio of products and services that they acquire and organically build over time. And as such, a set of strategic partners and start-ups form a funnel of innovation opportunities into the organization. In the pharmaceutical industry, it is very common for companies to create partnerships, and then to ultimately acquire and enhance them; hence incorporating each of the build, buy and partner components of growth. How does an organization optimize their business portfolio and opportunities to ensure that they’re fuelling the innovation pipeline? Let’s take a closer look into the innovation of one of the world’s largest, and most recognized organizations: Microsoft. A Microsoft View On InnovationDan’l Lewin, Corporate Vice President for Strategic and Emerging Business Development with Microsoft, shared with us his perspective on the concept of the innovation pipeline and how it affects growth. (This session was hosted at Microsoft's campus in Mountain View California which Dan'l is also responsible for managing.) The necessary pace at which innovation must occur is accelerating. Things within the open innovation funnel of an organization must move more quickly, and with more flexibility than in recent years. The primary challenge within Microsoft’s early history was innovating industries or markets which were merging into larger markets. For example, word processing did not stand alone as a market in the end, but eventually evolved into an office automation suite. Dan’l cites another example within his organizations’ evolution being spell check. Spell check was originally offered as a stand-alone product, but today it is natural to be integrated into most of their office suite programs. The tech industry has rebuilt itself over time to fit this type of evolution. Ideas must evolve; there must be new innovations and there must be the ongoing dissolution of prior ideas in order to create room for advancements. “Microsoft has excelled at this process and has embraced this global challenge, leading the way for innovation within the industry,” states Lewin. Does IT Matter Anymore?Dan’l observed that IT has seen dramatic changes over the past several decades, and it seems as though the speed of change has increased in parallel. But, the question posed by recent press queries, ‘does IT matter anymore?’ has sparked interesting debates amongst industry professionals. As technology continues to advance, how has the functionality of the more traditional IT departments changed? Dan’l described a fundamental belief within the Microsoft organization that while either creating a new market or dissolving an old market to create a new market, that IT is the essential underlying ...Best PracticesOpportunitiesStrategyInnovationTechnologyGrowthAdrian Ott2009-08-09T01:13:00Zhttp://newroadstorevenue.com/2009/07/24/how-cisco-approaches-innovation.aspx?ref=rssNotes from our Strategy & Growth Roundtable with CiscoBy Adrian C. OttAt one of our recent Strategy & Growth Roundtables, Steve Steinhilber, Vice President of Cisco, shared his perspectives on how Cisco fuels their innovation pipeline and how it impacts growth. According to Steinhilber, one thing which is clear is that innovation is going to be the only long-term method of creating and sustaining value for organizations. He continued, suggesting that innovation is the engine that drives Cisco’s growth, supported and encouraged by the corporation’s culture. The corporate culture at Cisco shifted several years ago to place focus on innovation. To explain this shift, Steinhilber asked, “What does this mean other than putting it on a badge”? He responds by suggesting that, “for Cisco, a culture of innovation means: · We recognize and reward innovation. · We are willing to take risks and we don’t punish people for making mistakes. · We bring in outside ideas. One of the most important things we can do is to create a culture within an organization that fosters and encourages innovation.”The Many Dimensions of InnovationInnovation can occur anywhere within the value chain of your organization. And, it can cut across business divisions and departments. Steinhilber offers an example of how one innovation idea can impact an entire organization. Cisco’s Network Academies, formed several years ago, offered one of the best ROIs the company has ever seen. These academies established around the world have created a series of jobs and have extracted targeted expertise from worldwide partners. Cisco offers the process for setting them up, empowering people to do what they are capable of doing. What have these academies meant for Cisco? These academies have created a pool of expertise around the world that will continue to fuel the growth, development and innovation the organization needs to remain competitive. Innovation can also occur in business process. Innovation within Cisco also occurs through the following processes and examples: · New Business Model-Linksys · New Product or Service - Storage Networking · New Process Business Councils · New Education Engine-Networking Academies · New Market Unified Communications · New Customer Experience-Network Advanced Services · New Technology-CRS-1/IOX · New Channel E-Commerce As you look across the Cisco value chain, you will see that people can create innovative ideas within any ...Best PracticesTechnologyStrategyInnovationOpportunitiesAdrian Ott2009-07-24T20:51:00Zhttp://newroadstorevenue.com/2009/06/19/is-customer-loyalty-a-generational-term.aspx?ref=rssBy Adrian C. OttWhile attending a recent presentation on customer loyalty, a question from a member of the audience sparked my imagination. "Do Millennials care at all about loyalty? Does loyalty to products and brands still exist?" When I looked around the room, there seemed to be a mood of skepticism about the topic of customer loyalty. Another woman responded, "It is hard to be loyal because there are so many options out there today. There are always new products that seem interesting."Are they correct? I remember my parents unquestioningly buying Ford automobiles, or insisting on filling up at "Herb's" corner gas station. Are loyal customers an endangered species in the business world - soon to join the fate of the dinosaur? or the typewriter? Are executives and marketers deluding themselves?Only 2.5% of Consumers are LoyalNo doubt, our relationships with brands have significantly changed. The Financial Times cites a two year analysis of 685 brands using data from 32 million consumers that in 2008 the average brand lost a third of its most highly loyal customers. These customers were lost to price and promotions from other brands - something brand marketers considered improbable in the past.B-to-B executives constantly complain about pricing pressures and reverse auctions as vendors are deemed as replaceable. Even products and services that were considered fortresses of differentiation reach commodity status at a record pace.The CMO Council and Pointer Media Network study further reveals that 80 percent of brand sales are attributed to only 2.5 percent of shoppers - not 80/20 as previously thought. Searching for traditional brand loyal customers is like looking for a needle in a haystack. These figures suggest that such customers could be considered as endangered species.Tilting at Windmills of Unwavering Customer AllegianceAccording to Merriam-Webster's Online Dictionary, "loyalty" is an act of unswerving allegiance. Synonyms are: faithfulness & fidelity. These terms connote an unquestioning devotion - an effect on our emotions that drive our actions. Analogous to a marriage where using competing products constitutes a terrible act of adultery - something to be avoided at all costs.Consider the products and services you use personally and for business. How many of those items truly stand out for you? How many would you drop if something better, (or cheaper with equivalent quality), came along? Rather than tilting at windmills in pursuit of unwavering allegiance, a more pragmatic and fresh approach is needed. Let's stop focusing on diminishing returns of 2.5% of customers and think about the rest of the 97.5% of customers out there. Don't they have money to spend?Customer engagement today is different because there is a greater risk of distraction. Time is limited. We multitask as we juggle different types of technology. The Internet and globalization have enabled a plethora of products and services that vie for our time and attention. We can buy products and services from across the globe. Consider a teen ...MarketingStrategyCustomerCustomer BehaviorAdrian Ott2009-06-24T18:05:00Zhttp://newroadstorevenue.com/2009/04/21/us-companies-need-to-cowboy-up-on-innovation.aspx?ref=rssBy Adrian C. Ott Not far from my home are the grounds to a large western rodeo. Dusty pick-up trucks drive around town sporting bumper stickers that say, "Cowboy up!" "Cowboy Up!" means that when you fall off the horse you have to get back up, dust yourself off, and keep trying. It is a shift in attitude from "can't" to a positive "can-do" with confidence. It is a non-complaining spirit that becomes contagious. Indeed, the economy is rough right now. If we are not hurting personally, we have family and friends that are experiencing pain. We are suffering the consequences of lost jobs, lost income and lost opportunities. Businesses are suffering as well.Employees and the media whine about why things don't work...and then we wonder why they don't. Have you ever heard of a situation being solved by whining? During tough times, it is far easier to lay low, burrow into deep trenches and say "No" rather than having the courage to say, "Yes, let's try to make this work.' But we have the power to change all of that. The U.S. is the most entrepreneurial country in the world today. The Silicon Valley specifically is renown for fast-paced innovation. Gains are not made by abiding by rote learning, and hard and fast rules. Winners thrive on change and flexibility to act. When a start-up, or new technology or new market doesn't work, we learn from it and move on. We should not let fear of the economy keep us from pursuing risks in penetrating new markets, and higher-potential opportunities. Risk-taking is a wild ride even in good times. Let's not hobble our employees, entrepreneurs and venture capitalists with more rules, more taxes, and more reasons not to contribute. Take a look at your product and service portfolio for your business. Is it comprised entirely of safe bets and low reward product extensions? Or do you have a portion of your new offering pipeline invested in a few high risk, high reward opportunities? Now is the time to "Cowboy Up!" on innovative market opportunities, lest we stay on "safe" ground and get kicked in the head by our competitors.(c) 2009 Exponential Edge Inc. All Rights Reserved ...Adrian Ott2009-04-21T14:59:00Zhttp://newroadstorevenue.com/2009/04/08/share-of-customer-time-and-the-social-media-shakeout.aspx?ref=rssby Adrian C. OttI hate to do things twice. Re-work, system crashes and "do overs" are very frustrating. Why? Because they take precious time that could be spent elsewhere. We all want to do things once and move on. With the proliferation of social media platforms we are hitting a saturation point - Facebook, Ning, Twitter, LinkedIn, MySpace, Biznik, Plurk, corporate networks, industry communities and others . My head is spinning. My colleagues and clients are telling me this as well. How many communities can we participate in and still have a life? In 2007, we predicted in Fast-Forward 2010: Social Media Shake-out that people will make decisions as to where they will spend their precious time. Once social media is understood, customers will avoid duplicating efforts. Customers will strive to be more efficient with their time by consolidating their regular social media interactions to a number of favorite communities. Customers will gravitate toward communities that give them the biggest return and highest value for their time. Critical mass (or what economists call "network effects") plays a key role because the value of social networking lies in locations where others congregate. If we need to reach John, do we need three social networking sites to link, friend or follow John? One will do nicely thank you. This scenario is beginning to play out as customers are flocking to sites like Facebook and Twitter. Mark Zuckerberg of Facebook recently stated that they have more than 200 million users. If Facebook were a country it would be the fifth largest in the world. Indeed, a few mega-communities will dominate, however I don't envision a one-size-fits-all. We have different dimensions to our lives and sometimes we like to keep things separate (e.g. work and personal). What I foresee is:Customers will belong to one to three mega communities. These will house our master profiles. For example, Facebook for friends. LinkedIn for business. Customers want to manage a limited set of profiles. This is why we see many sites with system generated user pictures in the members list. Most people don't want to bother setting these up multiple times. Customers will belong to a limited number of niche communities: Customers will focus on a few communities that offer unique value-add to their life and interests. For example, a professional industry community, a personal hobby community, a civic service community etc.. Certainly everyone has niche preferences, that's what makes us all different and special. We expect that most people will participate somewhere in the range of 2 - 10 niche social media communities. Note: This is not in the hundreds or thousands, therefore not every company will be able to build an active community. Let's not confuse customer service with an emotional customer attachment. Certain niche communities will reside inside a mega community: This enables companies to ...Customer BehaviorOpportunitiesCommunitiesSocial MediaAdrian Ott2009-04-08T17:47:00Zhttp://newroadstorevenue.com/2009/03/30/entry-for-march-30-2009.aspx?ref=rssby Adrian C. Ott I recently moderated the 2009 Silicon Valley Chief Alliance Officer Roundtable that was hosted by Cisco. This was my second year moderating this annual event that was organized by the ASAP Silicon Valley Chapter. Twenty-seven VP and C-level senior executives responsible for alliances and channels from firms such as Intuit, Adobe, HP, Microsoft, EBay/PayPal, IBM, SAP, Oracle, Cisco, Seagate, LinkedIn, Salesforce.com, Capgemini and others attended this meeting. The executives represented an excellent view of trends and best practices shaping the technology and alliance landscape. "The companies represented today, contribute $464 billion to the U.S. Economy. With a total combined market cap of $859 billion, these companies not only shape Silicon Valley's economy but also the world's high-technology landscape," welcomed Jim Chow, President of ASAP Silicon Valley.According to Steve Steinhilber, VP of Strategic Alliances at Cisco, "As we have seen in the last few months, markets can change overnight. Sharing ideas and best practices in meetings like this is vital to staying on top of today's fast-paced environment." The topline findings are: A majority of executives view strategic alliances as more important in a downturn, but several challenges to growth such as regaining momemtum after cost reduction, and overcoming business risk confidence issues impede forward progress. Executives are continuing to invest in disruptive technologies (e.g. Cloud Computing/Software as a Service (SaaS)) and new market penetration opportunities. New business models such as SaaS are changing the role of channel partners. This will result in new compensation and services models for the channel in line with these new models. Most companies are re-evaluating their alliance portfolios but also changing the measures by which they value and resource the relationships. For example, evaluating the financial viability of even the largest partners and customers has become a necessity. The need for new partner evaluation criteria is surfacing as new partner models such as talent-swapping emerge. Partner metrics beyond revenue are evolving that are increasingly tied to profitability and "Forensic Accounting." Internally communicating the value the partner organization remains a key priority in light of downsizing and cost reduction. Current macro-economic shifts in wealth distribution in the U.S. and abroad are expected to impact the partner portfolio mix. As best summarized by Erna Arnesen, VP of Global Services Channels and Alliances at Cisco, "What we are seeing right now in this time of economic crisis is a more engaged and frank dialogue across the strategic alliances community....This will put all of us in a unique position to increase our focus on joint revenue, contribution, and investment returns." To access our white paper with complete findings and our analysis of this event: http://www.exponentialedge.com/sv_chief_alliance_summit.html ...Best PracticesAlliances and ChannelsStrategyInnovationOpportunitiesAdrian Ott2009-03-31T03:13:00Zhttp://newroadstorevenue.com/2008/10/24/five-ways-to-thrive-in-a-market-downturn.aspx?ref=rssBy Adrian C. OttThe recent credit market crisis causes us all to reflect about how we approach our businesses. We’ve undoubtedly encountered staff reductions and realized evaporating sales opportunities as companies and consumers retrench their spending. Worst of all, many of us have realized losses to our personal investment portfolios, Although painful, the bright side is that these changes offer an upside for businesses seeking growth – to take advantage of this, we need to reset our thinking to visualize opportunities in this new landscape. Below are five approaches that help you to not just survive, but thrive in an economic downturn: As markets dissipate, new industries emerge. Although spending is curtailed, businesses and consumers still need to purchase goods and services. What has changed is that they are spending differently. Adapting to new markets that emerge during these times is pivotal to success in this new market climate. Although real estate mortgages are imploding, foreclosure, and credit counseling services are booming. Print and media advertising is declining, but internet advertising is growing – Google’s recent strong financial results are a testament to this transition. Alternatively, offering products and services that help companies to downsize or reduce costs could be a vital new revenue source. Rather than further entrenching into your existing market that is going nowhere, consider new market green fields. Are you shifting investments in your offerings and marketing campaigns to reflect the realities of economic down cycles? Consider shifting your offerings to reflect buyer realities. Assisting companies to outsource software as a service instead of implementing in-house creates a lower entry point, fewer staffing requirements, and less stress on capital budgets. Can you offer services that help customers achieve greater ROI on existing assets rather than buying new equipment? Can you help them make existing employees more productive? Can you reduce organizational disruption to reduce stress on remaining employees. Can you make your offerings less financially stressful and easier to digest for your customers? Avoid peanut butter budget cuts. Rather than cutting expenses by 10% across the board, use this as an opportunity to “prune the tree” by eliminating less desirable programs in order to focus growth and energy on a few key areas. Use this as an opportunity to rethink what you are doing. Your competitors are also cutting back…and are distracted. Markets that seem impossible to penetrate during strong economies present opportunities as competitors curtail efforts. This may evoke a strong entry opportunity that can take hold when markets turn upward. The key is to be poised to take advantage of it. If you can execute a focused strategy quickly while your competitors are consumed by organizational changes and loss of employees to execute, you will achieve the upper hand. Start Executing. Although we often want to lick our wounds with corporate change, getting ...Best PracticesMarketingStrategyGrowthOpportunitiesCustomer BehaviorAdrian Ott2008-10-24T17:06:00Zhttp://newroadstorevenue.com/2008/09/29/my-lecture-at-university-of-california-extension.aspx?ref=rssLast week I was invited to lecture at U.C. Extension by my respected colleague, Gary Katz, CEO of MO Partners www.mopartners.com. I enjoy these opportunities because I am able to test some of my latest ideas. Most students at U.C. extension are college graduates who work full-time in Bay Area businesses. They are continuing their studies to remain current with the latest trends in their field. Sharing ideas with the students not only enables the class to explore intriguing new ideas, but provides a terrific real-world perspective outside of my client network. A Student Question on Product Porfolios: After the class a student e-mailed me: Thank you for your presentation last night. You mentioned that when the engineering group presents 120 products to the marketing group, the marketing group needs to sort out the product category and marketing priority. In my experience, the engineering group's goal is to provide the product that meets the functional requirement provided by the marketing group based upon the market inputs. Therefore, the marketing group shall have known about the marketing priority of the products and have guided the product production forecast and new design requirement. It seems to be contradictory to your example. Would you please explain? My Response: To answer your question on product priorities, many large companies have more than 100 products and services in their portfolio. Although marketing may define the requirements for each product or service upfront, the entire offering portfolio must be prioritized in relation to market priorities. These priorities may have shifted from the time that the original requirements are created and by how engineering executes the offering based on the market information.Product releases may include: minor releases (e.g. a 2.01.01 bug fix and features) a major upgrade (from 1.0 to 2.0 version) brand new products Marketing needs to differentiate the marketing investment between these different types of releases. For example, product launch investments may be categorized as "A", "B" or "C" priorities. The market investments associated with each varies. An "A" launch may be at a big event with all hands on deck. A "C" launch may only include an announcement on the website and combination with other "C" launches into an installed base e-mail communication.Several companies that I work with differentiate these priorities not only by the type of release but also by whether the offering is an extension to an existing market or penetration into a new market. An acquisition complicates such priorities. Product and services in the new company must be prioritized in terms of markets and products relative to existing products so marketing knows what types of campaigns to launch and how much to spend. Marketing cannot afford to execute 100 campaigns and needs to define relative priorities. We've helped client with models to determine these priorities. Prioritizing the Product Portfolio is Important Prioritizing ...Best PracticesStrategyExecutionGrowthAdrian Ott2008-09-29T15:48:00Zhttp://newroadstorevenue.com/2008/02/24/live-from-association-of-strategic-planning-annual-conference.aspx?ref=rssBy Adrian C. OttI was invited to speak at this year's Strategic Planning Annual Conference in Marina Del Rey, California.While attending the conference, I had the opportunity to sit in and listen to presentations by other strategic thought leaders. Although I was unable to attend every session, key topics in this year's conference were:1) How to increase the pace and quality of decision making2) How value chain analysis can result in better customer understanding3) The role of the Chief Strategy Officer4) How technology innovation is more predictable than you might think.I will write about these topics and my thoughts on implications in subsequent postings. In addition, I will share information about my presentation on Customer BehaviorNets. You will hear more about this in the coming months. ...Best PracticesStrategyOpportunitiesCustomer BehaviorAdrian Ott2008-02-24T16:08:00Zhttp://newroadstorevenue.com/2008/02/10/silicon-valley-senior-executives-speak-on-trends.aspx?ref=rssby: Adrian C. OttOn January 16, I was invited to moderate a Chief Alliance Officer meeting of twenty-one senior executives of some of the largest firms in the Silicon Valley. Participants included Senior VP, VP and Sr. Director Representatives from firms such as IBM, Paypal, Cisco, BEA, BMC, Symantec, Cognos, Philips Electronics, Oracle, Symantec, Borland, Informatica, Intel, and others. This annual event was sponsored by the Association of Strategic Alliance Professionals (ASAP) Silicon Valley Chapter. This was an open dialogue between the executives to share the latest trends and best practices.Below are a few insights we uncovered: Silicon Valley Alliance Executives see major change ahead caused by enterprise software industry consolidation and new business models such as Software as a Service (SaaS) and IPTV. 80% of the attendees characterized the level of change occuring in their alliance ecosystem to be "significant" over the next three years. 20% see "moderate change." None of the executives saw "no change." Business Ecosystems Are Becoming More Diverse Making Strategic Bets More Difficult SaaS (Software As A Service) Dis-Intermediates Existing Business Models and Creates New Paradigms Technologies such as e-communication and behavioral targeting offer promise to managing increasingly complex global partner ecosystems Approximately 30% of alliance and partner organizations are adopting some form of social media and community technologies like blogging and virtual tradeshows, but most are "wait and see." For our free white paper that shares more detail on trends, best practices and our assessment of the implications, please click here: http://www.exponentialedge.com/autopub/siliconvalleychief.html ...StrategyAlliances and ChannelsOpportunitiesBest PracticesCustomer BehaviorTechnologyCommunitiesSocial MediaAdrian Ott2008-02-10T17:09:00Zhttp://newroadstorevenue.com/2008/01/27/ten-trends-and-opportunities-to-watch-2008.aspx?ref=rssOur senior strategy team at Exponential Edge had the opportunity to collaborate on what we see as salient trends and opportunities for our clients and community in the coming year. Here are the ten (not in order): New Platforms Take Hold Customer Behavior Trumps Traditional Market Approaches Digital Demographics Become Increasingly Important for All Industries Privacy is the New Black Marketing and Sales Redefine Themselves to Adapt to Dramatically Changing Customer Relationships Remote Monitoring and Testing Proliferates Business Ecosystems Become Increasingly Diverse Selecting Technology to be Incorporated into Offerings is more than an IT Vendor Decision Strategic Planning is Becoming More Frequent and Intensive Mining the Internet If you would like a Free White Paper that describes these trends and opportunities in more detail, please click here www.exponentialedge.com/toptentrends.html to download a copy. ...Digital MarketingInnovationStrategyGrowthOpportunitiesCustomer BehaviorAdrian Ott2008-01-27T15:01:00Zhttp://newroadstorevenue.com/2008/01/12/hbs-centennial-gala-sf-bay-area.aspx?ref=rssBy Adrian C. OttThis week I attended the Harvard Business School (HBS) Centennial Gala at the Computer History Museum in Mountain View. About 400 Bay Area HBS alums attended. Many of whom are notable VC's, and senior executives. It was great to catch up with old colleagues and classmates.Dean Light gave an interesting presentation on the future of HBS. He spoke about setting direction for the school's research for the next 50 - 100 years. Key directions he cited were: More research on the Health Industry. This is an industry that clearly needs help with business models More research in Science Industries. Innovation is a key theme for selecting this area. Teaming with the Kennedy School of Government on Green and Social Enterprise He also articulated that although the research content will change, many processes such as the case method and teaching classes in Boston (vs. remotely) will remain the same. Indeed, the school has the enviable position of taking a long term (50 year) view on its strategic direction and processes. This is a result of its strong worldwide reputation (brand) and limited perceived competition. Very few businesses I know can do the same. Industry disruption is causing businesses to hold strategic reviews more often. This results in frequent course corrections to process and business models. ...StrategyGrowthAdrian Ott2008-01-13T00:18:00Zhttp://newroadstorevenue.com/2008/01/04/the-automobile-a-mobile-pc-platform-with-wheels.aspx?ref=rssBy Adrian C. OttThe WSJ recently wrote about the role of automobiles as digtal devices. For the first time, automobile manufacturers will be participating in a major way at this month's CES show with a hall dedicated to advancements in this area.Microsoft and Ford SYNC (tm)What is clear is that the automobile is becoming a mobile platform on its own. With the addition of safety and communication devices such as GM Onstar, mobile TV, GPS devices, and internet access, the automobile is transforming from a consumer product to an intelligent mobile platform. As a captive audience, customers must spend time in their car. Whether they realize it or not, the automakers own a Share of Customer Time (tm); the automakers have a strategic opportunity to capitalize on their existence as a gatekeeper to the customer. To capitalize on Share of Customer Time (tm), the auto manufacturers are building their own Customer Behavior Networks (tm) (CBNs) to serve passengers with digital innovations such as GM Onstar. These provide an opportunity to extend their relationship with the customer and thus monetize the opportunity. As the car designer, they have an opportunity to take the role as Leader in this Customer Behavior Network (tm). Consequently, they have the power to determine what companies play and what companies don't play in their cars.It is apparent that Microsoft sees this opportunity as they recently signed a deal with Ford to embed Microsoft Auto Software in Ford vehicles named Ford SYNC (tm). I will write more about Ford SYNC tm in a future post.Strategically, how will the automakers approach the development of their Customer Behavior Networks (tm) in the future? Who will the auto manufacturers partner with in the technology industry? Will these relationships become proprietary and exclusive? or will they open their automobiles to serve as a platform to encourage as many players as possible in the Customer Value Network? Will the automakers learn and adapt from the computer hardware and software industry? How about the communications carriers that enable access without revenue benefit by Google and others? Will the automakers make the same mistakes? As Leaders of this CVN platform, will the automakers monetize such relationships? Unlike the communications carriers who historically were limited by regulations, the auto companies do not have such precedents over content and pipes. For example: Mobile promotions and advertising as the vehicle gets in close proximity to restaurants and gas stations. How will the revenue from such relationships evolve? Will they allow Google or Microsoft to take all of the revenue from searches? or will there be a revenue split based on the ability to gain access to their customers? Will the auto companies create proprietary content? Will communities evolve such as messaging, games or interaction for people traveling in a caravan? How ...Digital MarketingStrategyCustomer BehaviorInnovationOpportunitiesCommunitiesAdrian Ott2008-01-04T14:13:00Zhttp://newroadstorevenue.com/2007/12/15/customers-have-changed-are-you-keeping-pace.aspx?ref=rssBy Adrian C. OttA CEO of a public Silicon Valley firm said to me last week, "Customers don't want to buy the drill anymore. They want to buy the hole." Although simply stated, this comment was very insightful. Customers have changed. Consider how busy our lives are today. Do you get innundated with information? Do you try to multi-task in order to accomplish more each day?Below are our observations as to how customer behavior has changed: Customers want the problem solved. They are not interested in the how. They want it to work, right out of the box...with as little explanation as possible. When I received my first iPod it was very easy to get up and running. Prior to that, I had an MP3 player that never made it out of the box; I didn't have time to figure it out. Customers are digitally savvy. Consider your cell phone and internet usage. Did you have these in the early 1990's? Almost everyone these days is connected in some way. We even see images in major magazines of camel drivers and cowboys chatting on their cell phones. Customers are mobile. Once the domain of the upper-class, cell phones, notebooks and digital devices are pervasive. Wireless technologies are a reality. Most airports, hotels and coffee shops enable connection. Customers are more educated on what they buy. With the advent of the internet, never before in the history of markets has so much information been available to buyers. Customers want a two-way dialogue on product and services that matter to them. The rise of blogs and communities enable discussions that were not been possible before. Customers want to save time. Anything that saves time has high value. As one of my colleagues say, "Their hair is on fire," particularly around the holidays. Plus, one thing that hasn't changed: Customers want to save money. This is more than just making more advertising noise. In fact a recent study indicated that roughly 60% of early adopters are "sick of advertising." What stands out, will be those offerings that fit better into a customer's hectic day. As with any change, opportunities to innovate new product and service concepts abound. They simply need to be found. Businesses need to change their mindset to Share of Customer Time(TM) in order to manage in today's landscape. Although utilizing customer behavior is not new, the need to understand the context of customer lives is more salient in today's connected economy than ever before. Stories make sense out of our crazy lives. They put our products and services in context. They place everything into a topic that we can digest.Is your organization responding to these ...TechnologyDigital MarketingStrategyExecutionOpportunitiesCustomer BehaviorGrowthAdrian Ott2007-12-15T11:58:00Zhttp://newroadstorevenue.com/2007/11/15/meeting-with-dan-nye-ceo-of-linkedin.aspx?ref=rssby Adrian C. Ott/images/99184-91919/logo.gif" width=129 border=0>Yesterday I had the opportunity to attend a meeting with Dan Nye, CEO of Linkedin. Also presenting was Allen Blue, one of the founders and currently VP of Product Strategy.According to Dan, the key benefit of their community is their demographic namely:White collar ProfessionalsAverage age: 4178% college graduates Avg. Household income $106,065With over sixteen million members today, Dan indicated that they are growing at 1 million members per month. Indeed the demographics of this community are impressive. After listening to this presentation, what is also clear to me is that the strategic moves they make inthe next year will be a key to their survival. Here's why: Linkedin's professional demographic presents an opportunity and a challenge. Professionals are ADHD. Between work and family, professionals have the most demands on their time. College and High School students don't necessarily have such constraints. Professionals shift their attention and energy to a community only if they see significant return.Today, Linkedin enjoys limited Share of Customer Time (tm). Although sixteen million professionals are listed, it is just that. Dan referred to it as "Resume 2.0." This is an accurate term. Most people I know are too busy to go beyond that, many users tend to be passive "It is a handy backup if I need to find a contact," stated one of my colleagues. The attraction factor for key communities are: Linkedin - Professionals seeking new jobs or sales relationships FaceBook - Dating, Social MySpace - Dating Social, Small business Plaxo - Address bookFacebook and MySpace hold higher Share of Customer Time (tm) because there is an emotional tie to meet with friends. It keeps bringing people back. The average time spent per day on these sites is incredible.Professional image is everything on Linkedin. Everything is arms-length. Why? Potential employers arethere. Executives with the ability to promote are there. Key question is whether Linkedin can move its audience up the participation ladder while maintaining trust that hopes, fears and weaknesses shared among friends and colleagues won't be shared with potential employers. It is not clear if the two can successfully mix. Bottom Line: Linkedin needs a killer application that creates higher Share of Customer Time (tm). Linkedin should explore different kinds of applications to attract professionals and differentiate their offering.I am not talking about stock quotes, calendars and clocks. It must be bigger than that to hold such an ADHD audience.Most promising is that Dan indicated that they are partnering with companies like SalesForce.com andthe Wall Street Journal. They may be developing Customer Value ...Alliances and ChannelsStrategyCustomer BehaviorCommunitiesSocial MediaAdrian Ott2007-11-15T15:35:00Zhttp://newroadstorevenue.com/2007/11/09/brand-platforms-what-works-and-what-doesnt.aspx?ref=rssBy Adrian C. OttThere is an article this week in the Wall Street Journal about brand partnering and brand platforms. WSJ: Like our Sunglasses? Try Our Vodka It provides branding licensing examples such as Ralph Lauren's foray into into items such as paint and candles. /images/99184-91919/PJ_AL282_pjFASH_20071107191446.jpg" width=150 border=0>The question arises: When does a brand go too far? How do you know when a license is a fit?My Key Observations: Customer activity and lifestyle are key. Ralph Lauren and Calvin Klein are successful because their brands are about lifestyles rather than a particular point product line. They strive for Share of Customer Day (TM). As long as the offering fits within the lifestyle and activities of the customer segment. it works. If you like Ralph Lauren's design style, it is natural that you would want to extend it to your home. Paint makes sense when you view it in that way. Point product brands have a harder time breaking out of that paradigm. Merchandise must support the brand. Pierre Cardin failed primarily because his firm licensed to shoddy merchandise that detracted from the luxury brand. The firm diluted the brand. Brand context must be considered. The new offering must fit the context for which the brand is known. Would you ever see Disney licensing their characters out of the context of families? Pirates of the Caribbean shaving cream. Never! Disney clearly understands the lifestyle and activities of its customers. Point to Ponder: Is your brand about customer lifestyles and activities? or is it about your point products? Do you have a brand platform that leads to you new markets? Or will fail when a point product declines? ...Alliances and ChannelsInnovationStrategyCustomer BehaviorGrowthCommunitiesAdrian Ott2007-11-09T14:06:00Zhttp://newroadstorevenue.com/2007/11/05/my-interview-with-smartmoney.aspx?ref=rssby Adrian C. Ott /images/99184-91919/smLogo.gif" width=170 border=0> In October, I was quoted in SmartMoney about how smaller companies can partner with larger companies to grow their business. Here is a link to the article: SmartMoney: How Small Businesses Can Land Big Contracts ...Alliances and ChannelsSmall BusinessGrowthOpportunitiesAdrian Ott2007-11-05T16:39:00Zhttp://newroadstorevenue.com/2007/10/29/winning-in-social-media.aspx?ref=rssby Adrian C. OttAs described in my prior post Fast-Forward 2010: Social Media Shake-Out, the corporate gold rush to capitalize on social media will result in too many communities and blogs that overwhelm customers and provide insufficient value to sustain them. A lot of money will be wasted as businesses attempt to go it alone or approach social media haphazardly. The number of sites will peak by 2010 and then decline into a stable number of communities as corporations demand ROI on their efforts. Many corporations will consider joining forces with others to create greater value and ROI.How do we manage given this scenario? Below are thoughts on how to win in this environment: Winners approach community building strategically and place bets accordingly. They develop community maps across all their customers. These maps profile customer activity to corporate offerings that achieve maximum ROI. It is an integrated and strategic approach against objectives. Dedicated communities will not be possible for all. Winners will seek to leverage communities with other companies or business units to create more compelling value for the community. They will build around customer activities instead of a point product. Winners will ensure ROI for their communities. They will seek ways to monetize communities or provide significant input to corporate decisions thus justifying the investment. Winners will leverage industry communities such as industry associations and dedicated communities such as Linked-in to gain broader reach. A significant and continuous value proposition is key to community building. Although we could talk all day about our products, would customers do the same? Linking to customer activity and pain points is imperative. If you would like to discuss developing a strategy for winning in this environment, please contact us. ...TechnologyStrategyOpportunitiesCommunitiesSocial MediaAdrian Ott2007-10-29T14:30:00Z