How Framestretching adds clarity


scaleuseimage

This morning on Twitter @Bedtimemath posted the image above with the caption that read: “A natural distribution spotted in the wild! The wear on a weight machine reveals where people place its pin.

Though we experience life using multiple senses-sound, taste, touch,scent and sight, how much do we actually use to understand our place and actions?  Consider this two dimensional picture, the visual more than likely drives the meaning we make. Did the words add any more meaning to what you understood in looking at the picture?

Last Friday, the strategy discussion I lead monthly talked about visual thinking and I realized how readily my business training reduces most if not all of the perceptions available through my five senses down to only one or two.

At work, we use words or numbers and rarely put both together as well as this tweet and accompanying image.  This visual asks you to interpret the worn out paint or coating and recognize a normal distribution , which is a statistical explanation that adds another dimension to our understanding.

Could you plot a graph with the information you obnormal-sampleserve?  How about wear vs. weight?  That’s only two dimensions, with weight values on the x or horizontal access, and wear shown on the Y or vertical access.  It might look like the two dimensional graph on the right.

Does this representation tell you anything more than  the original image? I assigned numeric values to the different amount of chipped coating. Do you connect the current location of the weight on the machine as  170 across and  estimate as I did 20 up?

Both image and graph show, but don’t tell as much as we assume.

Where’s the context? Do you know the amount of time it took for the paint to chip or relative distance between observations, or usage of the machine itself?  We know nothing about the users of the machine, or its location and yet we do don’t we? The rust itself takes time to form and we can infer that more users choose at least 50 pounds, and the most users 90 pounds.

More than meets the eye

Next time you view a two dimensional graph–ask yourself what’s missing?  Try to voice and articulate the context that you’ve assumed. Yes even if you do it alone, as hearing your thoughts activates different processing.  When you do it in the company of others you will be surprised at the differences in your understanding.

I happened to see that DataScope analytics, a Chicago Based Data science firm had posted a request under data science on Reddit.  They asked “What data skills do you wish non-data people you worked with (e.g. managers, PMs, marketing, HR, etc.) have?  The responses on Reddit were quite fascinating.

Personally, I couldn’t help but notice how the replies typified the  constant challenge and struggle that any information or data presents to everyone.  What does the data mean, what is it’s significance?

The same themes arose in the conversation among business people exploring the challenges of visualizing data, in which we quicly recognized that few people see the appearance of data and instinctively look to explore it, versus others whose interest in data are for the sole purposes of confirming what they know.

The questions and process with which anyone approaches data obviously informs how it gets used and thus represented too.  Too often we use only one or two dimensions as suggested by the graph of the interpretation of the photograph.  I created the variable wear based on my interpretation of frequency approximated by the degree of chipped paint.

In contrast, the two dimensions suggest more than they reveal about how the world works.  Economists, for example, plot  supply and demand curves that look like a large X.  Supply being the first line that descends vertically, and demand the second line that Ascends.  The vertical access is Price and the horizontal access quantity.

What else is  assumed in this representation?  Geography? Time?  what about probability and or frequency?  Accuracy or specific observations as in the photograph are not the point of the representation.  It’s merely to create a general understanding of the relationship between price and quantity from two different perspectives.

The economists are exploring  and not predicting behavior, they are merely seeking ot make sense of the world not necessarily profit from it.

Further explorations that southt to clarify the assumptions led to the evolution of the  behavioral economists and  their additional perspective enahances general  understanding  of people’s beyond the one dimensional buyer or seller role and expanded the representation.  The inclusion of additional dimensions of probability also introduce additional complexity in exchange for greater understanding.

My own training as an analyst has led me to begin with exploration, and interrogate rather than merely to extend or convert  the representations. There’s always ore than meets the eye when it comes to understanding what we see.

 

 

 

Is it Too Late for a Web Strategy?


Old spice man

If you don't know this man, then you're missing out on one of the more popular twists in popular culture and marketing of 2010. 

This is the Old Spice campaign's man of mystery.  Intentionally I did not insert the web video, nor am I interested in chasing down the viewer stats, though sales report isn't great.  It's here because the ad reference exemplifes multi-channel linked marketing strategy and came up  in last Friday's monthly Chicago Booth Alumni Club's Discussion around  Strategic Management Practices.

Wearing my research hat, and doubling as a typical consumer, the first place I turned to find the reference was to type the key word phrase "old spice man" into my google search bar located at the top of my web browser. My search was not to purchase, engage in conversation or to gain proximity to someone with product experience –that would need  some different key words.  The campaign as well as my search process shows the evolution of the internet and the effect of its influence in our lives.  The shifting trends exhibited below in this wonderful chart  was the focus by Chris Anderson and Michael Wolff in the provocatively titled September 2010 article in Wired The Web is Dead, long live the Internet

Internet traffic trends 2010

CISCO compiled data using the Cooperative Association for Internet Data Analysis (CAIDA). The chart suggests that Video and Peer to Peer traffic is increasing while the use of the world wide web is declining.  This data is somewhat misleading and the chart's suggestions that mobile apps, and other specialized channel options, will displace the web browser  is not so clear-cut.

Is this graph a credible and reliable translation of the geek speak from  CAIDA?  A more recent  analysis than what appeared in Wired, expresses the following:

" Continuing its growth in traffic, connectivity, and complexity, the current Internet is full of applications with rapidly changing characteristics."

Overall, CAIDA has found that traffic on the internet continues to grow,  which is not adequately represented by the two- dimensional graph CISCO and WIRED depicted. Growth does accurately reflect the transition and growing emergence of traffic off the world wide web and into  alternative internet based transmission paths (e.g. mobile based and other applications that allow real time streaming).  

This same transition mimics strategies used by effective  marketers who link the brand messages and campaigns across  multiple media platforms.  Key words provide the bridge. The more consistent their use across the growing number of media platforms,  the more certain an organization's promotion efforts will  intersect key consumer touch points on or offline.   Ideally, consumers pick up these same key words  and carry them across other natural communication channels, further enhancing the brand's reputation and in theory  increasing sales.

If your business is selling Search Engine Optimization (SEO) this emphasis on key words appears  great for business. It's not however where a capable marketing strategy should invest the majority of its budget.  Not merely because there is some danger to pursuing this strategy (see the The dirty little secrets of search in last week's New York Times); but the greater, more complex objective is reputation management and not key word optimization.  

 Historically, brand owners/creators controlled media messaging and placement.  To successfully sell, you "paid" for the privilege of being placed in front of consumers walking through the yellow pages or by a billboard, listening over radio/TV  or their eyeballs scanning newspaper or specialty publications. Product packaging, placement and promotion  are often  budgeted separately and only occasionally linked for a "special" promotion (e.g. cause marketing or a contest).  The rise of the world wide web, added the category of "owned" media to the marketing mix and budgets had to cover the cost of website development, content writers and traffic analysis, including SEO.  With Social Media, a third area– "earned" warrants increasing budget and management attention to monitor the customer-created channels and chatter of your brand enthusiasts  as well as brand detractors. (see complete description in Branding in the Digital Age by David Edelman). 

 The Edelman article's case study of a TV manufacturer across one touch point within the wider consumer decision journey proves far more  instructive than my earlier reference to the Old Spice ad and its multi-channel focus. 

"A costly disruption of the journey across the category made clear that the company’s new marketing strategy had to deliver an integrated experience from consider to buy and beyond . In fact, because the problem was common to the entire category, addressing it might create competitive advantage."    

Unlike Old Spice, the manufacturer opted to shift the marketing emphasis away from paid media.  Focusing on owned and earned media seems to enhance the effectiveness of their key words and multi-channel linkages, and engage traffic where it mattered most at the buy, and enjoy, advocacy, bond  touch points. This is not a prescription for all brands, but the case is instructive in identifying the disconnects and deficiencies in common web based strategies, or even of marketing extravaganzas disconnected from the ongoing conversations that are circling your business, product and/or brand.

Whether or not you belief in Chris Anderson's prognosis about the death  of the Web or buy into David Edelman's Consumer Decision Journey research, few organizations appear to have fully leveraged these changes.  Increasingly, an ability to execute and efficiently allocate resources to address the demands presented by the growing number of communication channels  will  distinguish successful companies from their competitors.  The changes create more opportunities for strategy to take a more commanding role in managing and driving the combined efforts, either internally or with the help of outside specialty firms.

Additonal Discussion Take Aways

  • Social networks are informative, free sources of intelligence that naturally build out and generate mutual trust and benefits to buyers and sellers. 
  • The role of the marketer is merely to influence and no longer the producer/director of the brand experience.
  • The responsibility for marketing  is changing and increasingly is upending internal role limitations  and requiring participation from unlikely sources e.g. corporate governance, communication standards and guidelines.  Employees share roles with customers and the more acquainted with internal policies, strategies and planning the more they can aide and assist in  wider message consistency. 
  • Authenticity has become ever more important.
  • Fluidity and increasing knowledge of terminology around the digital communications space is a valuable skills set…not just for marketers and IT folks. 
  • As reputation management rises and people do business more and more with the people that they know,  is there anything really being created of value, and are other marketing and sales efforts as necessary?
  • How do these lessons translate or enhance B2B sales? 
  • It's not the web vs. the internet differentiation that matters, as much as recognizing how one innovation(social media)  has brought into focus an array of  deficiencies and gaps within an organization (marketing departments) as well as an industry (e.g. advertising) The challenge is how to best integrate the old with the new. 
  • In the end, the prescription to know your customer before creating your strategy remains the first and foremost lesson. Knowing what your customer wants will always be helpful but successful business requires more.
  • True differentiation in products being marketed remain beneficial but the emphasis should be toward innovation in developing products. 
  • Important to remember the shape of the adoption curves with new technology and Chris Anderson's point that new doesn't replace old. New merely creates more table space to accommodate more preferences.  The challenge is the frequency we change, resort and revisit our marketing activities and resource priorities. 
  • Both  articles confirm the importance of social media and keeping up with changing technologies.  They also call attention to the  the challenges organizations  face in trying to bring them together  to create successful communities around their products and/or brands.

 

Any added thoughts, perspectives or cases are welcome.

Added citations

Edelman makes some of the same points in this article:

Four ways to get more value from digital marketing

By David C. Edelman, McKinsey Quarterly, March 2010

https://www.mckinseyquarterly.com/Four_ways_to_get_more_value_from_digital_marketing_2556

 

Trust Agents, Using the web to build Influence    by Chris Brogan and Julien Smith

NOW Revolution, 7 shifts to make your business faster   by Jay Baer and Amber Naslund

Seeing the Iceberg, Strategic responses to Business Disruptors


  Titanic image

By the time we see the iceberg, is it always too late to change our course? Business model disruptions often blind  fast growing companies,  shareholder  darlings, and result in their precipitous decline.  The impact is rarely limited, as the wake of the disruption ripples across the globe creating  great uncertainty in the capital markets. 

Last week Borders Group Inc appears to be the latest casualty.  WSJ.com – Borders Hires Restructuring Lawyers On January 18, the WSJ  reported  management’s decision to suspend book order payments and hired restructuring lawyers.  The resignation of top c-suite executives followed.  At this point, it appears collapse is their only alternative.   But last January, on the 27th their CEO resigned and the interim CEO announced in April a turnaround plan, that in retrospect  failed to keep them afloat. Is this case a failure of strategy, leadership or execution?  A full analysis isn’t necessary to realize that the larger cause was the absence of a timely response to their industry disruptors. 

I wouldn’t have paid much attention to this story, or been that drawn into the analysis had I not sat with Chicago Booth alumni last Friday and focused exclusively on this issue of business model disruptors.  The Border’s story was coincidental, and though none of us had the facts or details, we recognized that the leadership team could not have merely been asleep or unaware that trouble was looming. 

Mckinzie happened to publish a survey on the value of corporate strategy. Their findings were not surprising and merely confirmed the experience of the Booth and Kellogg  discussion participants. 

Strategy is hard

Defining the nature of your business is also challenging. Borders was first and foremost a bookseller. Their megastore concept, in  itself an industry disruptor, enjoyed great success until someone else ushered in additional  disruptors that took the lessons of the megastore online -switching mass in store sales and square footage overhead online.  I leave the case write-up to others.  The question is whether the disruption is inevitable and what if anything can a company facing similar game-changing disruptions do?  

It was precisely this question that the monthly discussion of Chicago Booth Alumni considered last Freday.  To frame the short conversation, attendees reviewed in advance three articles with strategic advice and  listed at the end of this post. 

Unlike the predictability and regularity of a ticking mechanical clock, the future rarely repeats or duplicates the past.  Our circumstances are always shifting, some subtly, occurring  as imperceptibly  as the orbital passage of the earth around the sun.  Business disruptors are successful because they are rarely taken seriously early enough. 

A single customer may be fickle; but consumers  rarely act  enmass, abruptly taking their business to the emergent competitor. The reality is that often the best customers remain loyal and the ongoing revenue stream, masks the departure and slow growth of the exodus into a massive iceberg  whose top once visible, is dismissed as small and inconsequential.

Most successful business leaders  monitor and report business metrics and then review them with interested stakeholders , e.g. senior management, share- holders,  board of directors. Rarely do these metrics reflect the full organization’s capabilities and/or its resilience to withstand disruptive threats.  Clayton Christenson studies of corporations facing change found  them missing any focus on  changes in demand as they occur in their marketplace. Resilient companies direct their attention to insuring existing resources can successfully meet the evolving needs of their customers.  The review process is not retrospective, but rather a future focused assessment. Examining the steps necessary to propel, not impede their processes and values toward  innovation.  In a race with a motorboat, paddling faster, or cutting dead weight won’t help you win. 

Strategic suggestions

Business model disruptions are rarely welcomed or predictable.  There are several tactical strategies that make it possible to bounce back to position. 

James Ogilvy, writing for Strategy +Business, offered metaphors from philosophy to exemplify how easily management and leadership can miss critical cues .  If however they create a culture that is more resilient amidst the ever present uncertainties of our world employees  emboldened  to speak and act early can help avert the looming disasterier.  Acknowledging our inability to predict the future we must decide how to operate in the present and still plan for changes we may not understand, measure or foresee.

Markides and Oyon writing for MIT Sloan review pushes past the work Clayton Christenson, Michael Porter and others on innovation challanges by narrowing them down to five key questions.  Asking these, management can better assess the potential damage caused by a disruption to its business or industry; and correspondingly, respond to the new competitive threat.  These questions don't produce the next actions plan, but for companies who recognize their current products, services or basic business model is time limited, it's the basis by which strategy should be revisited. Once again, the restructuring and committments will require great strength to meet the management challenges and incongruencies attached to creating something new while managing existing revenue opportunities.

Finally, another article from Strategy and Business (Leinwand and Mainardi) posits  merely being the game changer requires companies execute an effective capabilities driven strategy.  Outward facing, the strategic focus starts and ends with your customers.  This piece written before the phenomenon of Facebook and direct engagement utilizing social media tools was a great prescription.  The suggestion to build a portfolio of ideas, skills and competencies that can be put together coherently and mutually reinforce the organization’s overall capabilities is long on theory but hard to execute.  [note, an older article by Christenson and Ovendov in HBR 2000, outlines how to assess and find your core capabilities.]

Closing discussion take-aways

Discussants summarized their thoughts at closing as follows:

  • Where are the lessons on how to create culture transformations?  The prescription needs more details to be meaningful or effective.
  • Organizations and their leadership are not as dumb as they seem; rather inertia may be to blame, or more specifically its absence, which inevitably rolls up into a leadership problem.
  • If you can stop the bleeding, act sooner and change the management team it may help, but critically need to change what management is and has been doing to navigate a better course.
  • “Viewing your death”, an Ogilve tip, is only as helpful as how you perceive the future and the significance of the outside possibilities painted in a future scenario.
  • Remember who your ultimate customers are, not your board, not your leadership, only the shifting nature of your customers should be the rationale and focal point for business redirection.
  • Keep track of your fundamentals, the organization capabilities.
  • Be wary of the situational leadership conundrum…their path to the top shaped how they read the signposts and drive the organization forward. 
  • Best to take a long-term look, overcome the protective instincts that may ultimately undermine your ability to move the product along a more realistic and vibrant future. 
  • CEOs are ultimately responsible for strategy and any changes have to come from the top. 

The best insurance an organization can carry is regular consideration of outsider’s perspectives,  reality checks on their planning.  In theory, this should be a board of directors comprised of individuals whose own context and operating environment is in sharp contrast to your industry and culture.  The more divergent their views of the future, the greater the value of their contribution to your survival and success. 

Source Readings

 These  articles  were the basis of the Chicago Booth Alumni Discussion January 21, 2011

 What Strategists Can Learn from Sartre
http://www.strategy-business.com/article/03405
By James Ogilvy, Strategy +Business, Winter 2003
Strategic thinking can benefit from philosophy. In this reflective piece, the author explained why in an uncertain world where competitive advantage is insecure, setting strategy must become an existential exercise.
 
How to Win by Changing the Game
http://www.strategy-business.com/article/08401
By Cesare Mainardi, Paul Leinwand, and Steffen Lauster,
Strategy +Business, Winter 2008
This was the magazine’s first major piece on capabilities-driven strategy, laying the groundwork for Leinwand and Mainardi’s book The Essential Advantage: How to Win with a Capabilities-Driven Strategy (Harvard Business Press, 2010).

What to Do Against Disruptive Business Models (When and How to Play Two Games at Once)

http://sloanreview.mit.edu/the-magazine/articles/2010/summer/51413/what-to-do-against-disruptive-business-models/
By Constantinos C. Markides and Daniel Oyon,  June 26, 2010
Fighting against a disruptive business model by rolling out a second business model is one option for companies to consider. But to make that work, you need to avoid the trap of getting stuck in the middle.