Transcript The Challenge: To Create More Value in All Negotiations

Tom Peters’
RE-IMAGINE.
EXCELLENCE.
INNOVATE. NOW.
OR PERISH.
2014 PAI Market Partner Conference
05 December/Punta Cana
(slides at tompeters.com; also see excellencenow.com)
Meet Your
Next Surgeon:
Dr. Robot
“Meet Your
Next Surgeon:
Dr. Robot”
Source: Feature/Fortune/15 JAN 2013/on Intuitive Surgical’s
da Vinci
/multiple bypass heart-surgery robot
(“Almost all health care people get is going to be done by
algorithms within a decade or two.” —Michael Vassar/MetaMed)
“The combination of new
market rules and new
technology was turning the
stock market into, in effect,
a war of
robots.”
—Michael Lewis,
“Goldman’s Geek Tragedy,” Vanity Fair, 09.13
“Automation has become so sophisticated
that on a typical passenger flight, a human
pilot holds the controls for a grand total of
…
3
minutes
.
Pilots have become, it’s not much of an
exaggeration to say, computer operators
[c.f., AF447!].” —Nicholas Carr, The Atlantic, 11.13
Let’s Welcome Our Newest [Official]
“Just like other
members of the board, the
Board Member:
algorithm
gets to vote
on whether the firm
makes an investment in a
specific company or not.
[VITAL]
The program is the sixth
member of DKV's board.”
—Business Insider, 13 May 2014:
“A Hong Kong VC fund has just appointed an algorithm to its board.”
“The next frontier is a wireless
technology called
v2x
,
which companies in America, Europe and Japan
are developing. It encapsulates vehicle-to-
vehicle and vehicle-to-infrastructure
communications. Special modems allow
v2x-equipped cars to talk to each other and
to the world around them.”
—Mary Barra, CEO, GM, in the Economist, December 2014
“Proteus Digital
Health
SENSOR PILLS:
is one of several pioneers in sensor-based health
technology. They make a silicon chip the size of a grain of sand that is embedded
When the chip mixes with
stomach acids, the processor is powered by the body’s
electricity and transmits data to a patch worn on the skin.
That patch, in turn, transmits data via Bluetooth to a
mobile app, which then transmits the data to a central
database where a health technician can verify if a patient
has taken her or his medications.
into a safely digested pill that is swallowed.
“This is a bigger deal than it may seem. In 2012, it was estimated that people not
$258 billion in emergency room visits,
hospitalization, and doctor visits. An average of 130,000 Americans die
taking their prescribed medications cost
each year because they don’t follow their prescription regimens closely enough..”
[The FDA approved placebo testing in April 2012; sensor pills are ticketed to come to
market in 2015 or 2016.]
Source: Robert Scoble and Shel Israel, Age of Context: Mobile, Sensors, Data and the Future of Privacy
Walmart SV =
1,500
“What’s really interesting is
NEXT
FIVE YEARS
that over the
we’re going to see every industry exposed to
reinvention of how people put products and
services together, how work is done, what kind
of jobs and skills are needed, what can be
handled by technology.” —John Sculley
“Software is
eating the
world.”
—Marc Andreessen
-1/+1/2
S&P 500
-1/+1*
*Every …
!
2 weeks
Source: Richard Foster (via Rita McGrath/HBR/12.26.13
Enter the
Mittelstanders:
Middle-sized
Niche/Micro-niche
Dominators!
THE RED
CARPET
STORE
(Joel Resnick/Flemington NJ)
•*Basement Systems Inc.
(Larry Janesky/Seymour CT)
*Dry Basement Science
(100,000++ copies!)
*1990: $0; 2003: $13M;
2010: $80,000,000
The Magicians of Motueka & the Mittelstand Trifecta
W.A. Coppins Ltd.*
(Coppins Sea Anchors/
PSA/para sea anchors)
*Textiles, 1898; thrive on
“wicked problems”
—e.g., U.S. Navy STLVAST (Small To Large Vehicle At Sea Transfer);
W. Wiggins Ltd./Wellington
(specialty nylon, “Dyneema,” from DSM/Netherlands)
custom fabric from
JUNGLE JIM’S INTERNATIONAL MARKET, FAIRFIELD, OH:
“An adventure in
‘shoppertainment,’ begins in the parking lot
and goes on to
1,600
cheeses and
1,400
varieties of hot sauce—not to mention 12,000 wines priced from
$8-$8,000
4,000
a bottle; all this is brought to you by
vendors. Customers from every corner of the globe.”
BRONNER’S CHRISTMAS WONDERLAND, FRANKENMUTH, MI
98,000-square-foot “shop” features
ornaments,
50,000
6,000
Christmas
trims, and anything else you can
name pertaining to Christmas. …”
From: Retail Superstars: Inside the 25 Best Independent Stores in America, George Whalin
“BE THE BEST.
IT’S THE ONLY
MARKET THAT’S
NOT CROWDED.”
From: Retail Superstars: Inside the 25 Best
Independent Stores in America, George Whalin
Going “Social”: Location and Size Independent
“Today, despite the fact that we’re just a little swimming
pool company in Virginia, we have the most trafficked
swimming pool website in the world. Five years ago, if
you’d asked me and my business partners what we do, the
answer would have been simple, ‘We build in-ground
‘We
are the best teachers
… in the world … on the
fiberglass swimming pools.’ Now we say,
subject of fiberglass swimming pools,
and we also happen to build them.’”
—Jay Baer, Youtility: Why Smart Marketing Is About Help, Not Hype
Michael Raynor and Mumtaz Ahmed’: THE THREE RULES:
How Exceptional Companies Think*:
1. Better before cheaper.
2. Revenue before cost.
3. There are no other
rules.
(*From a database of over 25,000 companies from hundreds of industries covering 45 years,
the authors uncovered 344 companies that qualified as statistically “exceptional.”)
Innovate
or Perish/
Extreme Times
DEMAND
Extreme Solutions
“Insanely great”
(Steve Jobs)
“Radically thrilling”
(BMW)
“Astonish me!”
(Sergei Diaghilev, to a lead dancer)
“Build something great!”
(Hiroshi Yamauchi, CEO, Nintendo, to a senior game designer)
“Make it immortal!”
(David Ogilvy, to a copywriter).
“You can’t behave in
a calm, rational
manner. You’ve got
to be out there on
the lunatic fringe.”
— Jack Welch
/48
1/48/1966-2014
WTTMSW
WHOEVER
TRIES
THE
MOST
STUFF
WINS
In Search of Excellence: Bedrock “Eight Basics”
1.
2.
3.
4.
5.
6.
7.
8.
A Bias for Action
Close to the Customer
Autonomy and Entrepreneurship
Productivity Through People
Hands On, Value-Driven
Stick to the Knitting
Simple Form, Lean Staff
Simultaneous Loose-Tight
Properties
READY.
FIRE!
AIM.
—H. Ross Perot (vs “Aim! Aim! Aim!” /EDS vs GM/1985)
“We made mistakes, of course. Most of them were
omissions we didn’t think of when we initially wrote the
We fixed them by doing it
over and over, again and again. We do
software.
the same today. While our competitors are still sucking
their thumbs trying to make the design perfect, we’re
already on prototype version
# 5.
By the time our
rivals are ready with wires and screws, we are on version
#10. It gets back to planning
versus acting: We act from day
one; others plan how to plan
—for months.” —Bloomberg by Bloomberg
“EXPERIMENT
FEARLESSLY”
—BusinessWeek, “Type A Organization Strategies: How to Hit a Moving Target”—Tactic
#1
“RELENTLESS TRIAL
AND ERROR”
Source: Wall Street Journal, “cornerstone” of effective approach to “rebalancing” company
portfolios in the face of changing and uncertain global economic conditions
“You can’t be a serious
innovator unless and until
you are ready, willing and
able to seriously play.
‘Serious play’
is
not an oxymoron; it is
the essence of innovation.”
—Michael Schrage, Serious Play
FAIL.
FORWARD.
FAST.
“FAIL. FORWARD. FAST.”
—High Tech CEO, Pennsylvania
“FAIL FASTER.
SUCCEED SOONER.”
—David Kelley/IDEO
“MOVE FAST.
BREAK THINGS.”
—Facebook
“REWARD
excellent failures.
PUNISH mediocre
successes.”
—Phil Daniels, Sydney exec
“In business, you REWARD people
WHEN IT
DOESN’T WORK
OUT YOU
PROMOTE THEM -
for taking RISKS.
BECAUSE THEY WERE WILLING
TO TRY NEW THINGS. If people tell
me they skied all day and never fell
down, I tell them to try a different
mountain.” —Michael Bloomberg
WTTMSASTMSUW
WHOEVER
TRIES
THE
MOST
STUFF
AND
SCREWS
THE
MOST
STUFF
UP
WINS
Tempo/
Temperament
“If things seem under
control, you’re just not
going fast enough.”
—Mario Andretti, race driver
“I’m not comfortable unless
I’m uncomfortable.”
—Jay Chiat
“If it works, it’s obsolete.”
—Marshall McLuhan
“At the heart of Boyd’s thinking is an idea labeled ‘OODA Loops.’ OODA
In short,
the player with the quickest
OODA Loops disorients
the enemy to an extreme
degree.
stands for the Observe-Orient-Decide-Act cycle.
In the world of aerial combat, for example, the
confused adversary subjected to an opponent with short OODA cycles
often flies into the ground rather than becoming the victim of machine
gun fire or a missile. Boyd is careful to distinguish between raw speed
and maneuverability. In aerial dogfighting in Korea (Boyd’s incubator),
Soviet MiGs flown by Chinese pilots were faster and could climb higher,
but our F-86 had “faster transients”—it could change direction more
quickly; hence our technically inferior craft (by conventional design
standards) achieved a 10:1 kill ratio.”
—Robert Coram, BOYD: The Fighter Pilot Who Changed the Art of War
WTTMSASTMSUTFW
WHOEVER
TRIES
THE
MOST
STUFF
AND
SCREWS
THE
MOST
STUFF
UP
THE
FASTEST
WINS
WHOEVER
TRIES
THE
MOST
STUFF
AND
SCREWS
THE
MOST
STUFF
UP
THE
FASTEST
WINS
“Ideas Economy:
CAN YOUR
BUSINESS FAIL
FAST ENOUGH TO
SUCCEED?”
Source: ad for Economist
Conference/0328.13/Berkeley CA (caps are Economist)
Value Added I:
ADDING A
STRATEGIC
SERVICES
COMPONENT
“Rolls-Royce now earns
more from tasks such
as managing clients’ overall
procurement strategies and
maintaining aerospace
engines it sells than it does
from making them.”
—Economist
M
IBM
IB
to
PS
UPS
U
to
Value Added II:
DESIGN
PRIMACY
Design
#1
APPLE market
capitalization
> Exxon Mobil*
*August 2011
Hypothesis: Men
CANNOT
design for women’s
!!??
needs
Value Added III:
Women BUY
[Everything]
!
“Forget CHINA,
INDIA and the
INTERNET: Economic
Growth Is Driven by
WOMEN.”
Source: Headline, Economist
W>
2X (C + I)*
*“Women now drive the global economy. Globally, they control about $20
trillion in consumer spending, and that figure could climb as high as
$28 trillion
in the next five years. Their
$13 trillion in total yearly earnings could reach $18 trillion in the same
period. In aggregate, women represent a growth market bigger than China and India combined—more than
twice as big in fact. Given those numbers, it would be foolish to ignore or underestimate the female consumer. And
yet many companies do just that—even ones that are confidant that they have a winning strategy when it comes to
women. Consider Dell’s …”
Source: Michael Silverstein and Kate Sayre, “The Female Economy,” HBR, 09.09
“Women are
THE majority
market”
—Fara Warner/The Power of the Purse
MOST
SIGNIFICANT
VARIABLE in EVERY
“The
sales situation is the
GENDER
of the buyer, and
more importantly, how the
salesperson communicates to
the buyer’s gender.”
—Jeffery Tobias Halter, Selling to Men, Selling to Women
The Perfect Answer
Jill and Jack buy
slacks in black…
“Research suggests that
to succeed, start by
promoting women.”
—Nicholas Kristof, “Twitter, Women, and Power,” NYTimes
“In my experience,
women make much
better executives than
men.”
—Kip Tindell, CEO, Container Store
Value Added IV:
EXPERIENCE DESIGN & THE
“AGE OF
TGRs”*
*Things Gone
RIGHT
Conveyance: Kingfisher Air
Location: Approach to New Delhi
“May I clean
your glasses,
sir?”
“Experiences
are as distinct
from services
as services are
from goods.”
—Joe Pine & Jim Gilmore, The Experience Economy:
Work Is Theatre & Every Business a Stage
“I would rather engage in a Twitter
conversation with a single
customer than see our company
attempt to attract the attention of
millions in a coveted Super Bowl
commercial. Why? Because having people discuss your
brand directly with you, actually connecting one-to-one, is far more
valuable—not to mention far cheaper! …
“Consumers want to discuss what they like, the companies they
support, and the organizations and leaders they resent. They want a
community. They want to be heard. …
“[I]f we engage employees, customers, and prospective customers in
meaningful dialogue about their lives, challenges, interests, and
concerns, we can build a community of trust, loyalty, and—possibly over
time—help them become advocates and champions for the brand.”
—Peter Aceto, CEO,
Tangerine (from the Foreword to A World Gone
Social: How Companies Must Adapt to Survive, by Ted Coine & Mark Babbit)
Value Added V:
LBTs*
*Little
BIG Things
Big carts =
Source: Walmart
2X: “When Friedman
slightly
curved
the right angle of an
entrance corridor to one property, he
was ‘amazed at the magnitude of
change in pedestrians’ behavior’—the
percentage who entered increased from
one-third to nearly two-thirds.”
—Natasha Dow Schull, Addiction By Design: Machine Gambling in Las Vegas
“Flash When I work with experimental digital gadgets, I am always
reminded of how small changes in the details of a digital design can have
profound unforeseen effects on the experiences of the people who are
playing with it. The slightest change in something as seemingly trivial as
the ease of use of a button can sometimes alter behavior patterns. For
instance, Stanford University researcher Jeremy Bailinson has
changing the height
of one’s avatars in immersive
virtual reality transforms
self-esteem and social
self-perception.
demonstrated that …
Technologies are extensions of
ourselves, and, like the avatars in Jeremy’s lab, our identities can be
shifted by the quirks of gadgets. It is impossible to work with information
technology without also engaging in social engineering.”
—Jaron Lanier, You Are Not a Gadget
“You get a sense of the scale and
intricacy of the task by considering the
sound effects alone: The game contains
54,000 pieces of audio and 40,000 lines of
There are 2,700
different noises for
footsteps alone
depending on whose
foot is stepping on
what.”
dialogue.
—Sam Leith on Halo 3, from Jane McGonigal,
Reality Is Broken: Why Games Make Us Better and How They Can Change the World
BEDROCK:
MATCHLESS
TALENT
“Business has to
give people
enriching,
rewarding lives …
1/4,096: excellencenow.com
“Business has to give people enriching,
or it's
simply not
worth doing.”
rewarding lives …
—Richard Branson
"If you want staff to
give great service,
give great service to
staff."
—Ari Weinzweig, Zingerman's
EXCELLENT
customer experience
depends … entirely …
on EXCELLENT
employee experience!
If you want to WOW your
FIRST
customers,
you
must WOW those who
WOW the customers!
“It may sound radical, unconventional, and
bordering on being a crazy business idea.
However— as ridiculous as it sounds—joy is the
core belief of our workplace.
Joy
is the reason my company,
Menlo Innovations, a customer software design
and development firm in Ann Arbor, Michigan,
exists. It defines what we do and how we do it.
It is the single shared belief of our entire team.”
Joy, Inc.:
How We Built a Workplace People Love
—Richard Sheridan,
Your principal
moral obligation as a leader is to
develop the skillset, “soft” and
“hard,” of every one of the people
in your charge (temporary as well
as semi-permanent) to the
maximum extent of your abilities.
The good news: This is also the
#1 mid- to long-term …
profit maximization strategy!
CORPORATE MANDATE #1 2014:
Kevin Roberts’ Credo
1. Ready. Fire! Aim.
2.
3.
4.
5.
6.
7.
8.
9.
If it ain’t broke ... Break it!
Hire crazies.
Ask dumb questions.
Pursue failure.
Lead, follow ... or get out of the way!
Spread confusion.
Ditch your office.
Read odd stuff.
10.
AVOID MODERATION!