May 31, 2001
My 5 year old's Powerpoint is better than yours
As you prepare that presentation for your meeting next week, remember: A 5th grader can create as good a PowerPoint presentation as you. Put the slides on paper, leave the laptop on your desk, and say what you came to say. It's never more difficult, or effective, that that. People matter, but when it comes to PowerPoint, technology rarely helps.
May 28, 2001
7-11 and real-time analytics
The story of 7-11 in Japan (part of The Economist's e-commerce case study series) is really a story about business intelligence and the power of real-time analytics. According to the article, new technology that 7-11 adopted in the mid 1990's provided four benefits:
The first was in monitoring customer needs, which were changing as deregulation made shoppers more demanding...
...Second, Seven-Eleven uses sales data and software to improve quality control, pricing and product development. Thanks to its systems, the company can collect sales information from all its stores three times a day, and analyse it in roughly 20 minutes....
...Third, technology has helped to predict daily trends. As customers become more fickle, product cycles are shortening. Fashions in boxed lunches, riceballs and sandwiches, which make up almost half of a convenience store’s daily sales, are especially short-term. Most last about seven weeks, but they can be even shorter...
Finally, Seven-Eleven’s electronic investment has also improved the efficiency of its supply chain. Orders flow quickly.
Interestingly, only the fourth benefit actually relates to e-commerce. The rest are about using data more efficiently to make effective business decisions.
One of the most innovative parts of the system is not the technology used, but a unique way of putting disparate data together to come up with something completely new:
Seven-Eleven says it can keep abreast of these partly by keeping an eye on the weather. Five reports a day arrive electronically at its stores from hundreds of private weather centres, each covering a radius of 20km (13 miles). This is useful in Japan, where temperatures between towns 40km apart can vary by as much as 5°C. The reports also compare today’s temperature with yesterday’s. “The same 10°C can feel very different depending on whether it was 1°C or 20°C the day before. This is critical for predicting food purchases,” points out Mr Usui.
May 24, 2001
Waiting in line
The Wall Street Journal talks about waiting in line today. Did you know that it costs money for airlines to staff check-in counters, but your waiting in line is absolutely free? Or that if you didn't wait in line at the car rental desk, the agents would loose the opportunity to upsell you on add-on services? Does the success of these practices argue against a strategy of focusing on customer value? Do these practices even demonstrate a lack of focus on customer value? I'm tentatively saying no and no, and provide the following counter arguments:
- Value has many components, each with related costs. Successful businesses focus on the net value obtained by the customer. Most people give a higher value to low cost rather than service when it comes to flying. The lower cost of fewer ticket agents and longer lines allows the airline to provide greater overall value through more discount fares.
- Customer should not be confused with consumer. Consumers are the universe of customers. But not all consumers are customers of a business, and it is impossible for a business to focus on all consumers ("focus on everything" doesn't really make sense, does it?). In the case of car rental agencies - their customers are the frequent renters, and the companies do focus on providing value to this consumer segment. If anything, the infrequent casual renter is a distraction in the mission of a car rental company to provide value to its real customer.
The key element to success through a focus on customer value can be found from answering two questions: "Who is/should be my customer?" and "How can I maximize the value to him/her of what my business offers?"
Not to turn this into GE News, but GE has this reverse mentoring program going on where younger workers experienced in the ways of the Web are mentoring older executives on making it through a virtual meeting. At the same time, the kids get to grill the grownups about survival and success in the corporate world. Great idea, even though it demonstrates that you don't really need us consultants
May 22, 2001
Redesigning the code v. redesigning the user
In this month's MIT Technology Review Simson Garfinkel provides a commentary on redesigning the code v. redesigning the user. He makes some excellent points. I'm reading the article and agreeing all the way. But at the end, I thought of my Handspring and the Palm OS Grafitti language for entering data. Obviously, there are some points at which people are very willing to learn a new way of doing something in order to take advantage of a technology. The trick is to provide enough value so that there's something left over after the expense of adopting the technology. The best way to do this is through an adaptive approach. If you still can't get the value equation to work, then you have to change the technology.
May 16, 2001
Novelty and Value
It seems that I've been seeing a lot of articles lately about using human faces for interaction on the web. A recent puff piece claims that virtual faces will cure the problem of people not clicking that final "order" button. I doubt it, though. Most people still connect via slow dial-up connections. And those people (yes, most people) don't want to wait for an animated face to load in their browser when they're trying to buy pants. Putting a human face on web interaction is an intriguing idea, but for the foreseeable future, it provides little true value beyond novelty appeal.
May 10, 2001
Managing supplier relationships is your job, not someone else's
Managing relationships with suppliers is another entry on the topic of "what companies are supposed to do". The active buzzwords/TLAs for this are B2B and SCM (supply chain management). The key is using the web to serve rather than compete with existing markets and recognizing that managing supplier relationships is your job, not someone else's.
May 9, 2001
May 8, 2001
Time Warner Books' e-book strategy
At first glance, a report in the Boston Globe on Time Warner Books' e-book strategy (iPublish) looked intriguing to me. It talks about TWB doing more than just adding e-books to their product mix. It talked about adding services for writers and developing a community where peers can critique each other's work and identify solid candiates for distribution by TWB. But I saw that the article was written by someone named "Globe Staff". Then I took notice of an unattributed quoted phrase: ''a fully integrated, end-to-end publishing business and writing community open to the public.'' Anytime someone says "end-to-end" or "fully integrated", question anything else you hear from them (I should know, I'm a consultant, and I use those words all the time).
Time Warner claims to be "re-inventing publishing" with this iPublish gimmick. If you look closely, though, you see that their focus isn't to provide a service to writers or readers. The focus is on streamlining their own "supply chain" - to help them churn through more manuscripts without hiring more readers or editors. There doesn't appear to be any new value provided for writers (back when I wanted to write the great american novel in the late eighties, I remember participating in such an on-line writer community on Compuserve). There doesn't appear to be any new value provided for readers. There doesn't seem to be any there there. I don't think they're going to accomplish what they want with this effort.
May 4, 2001
Brokers are people
Barabara Corcoran, Chairman of the Corcoran Group - a high end real-estate brokerage in New York City - interviewed in the Wall Street Journal:
This is a lesson I've learned: that the Web is a means to an end. So now I clearly understand that the Web produces customers for my business. For a while there, when I built up my technology department enormously, I really believed that the Web was a business in itself. It's not.and
I thought the hard charge initially was getting a Web site so that it was user friendly ... then chockfull [of information]. The hardest part was: Answer the e-mail. Once [the site] was up, it was easy; we were getting leads galore. But the brokers never opened their e-mail.
The challenge isn't technological - it's human.
May 3, 2001
Convenience and technology
An article in today's Wall Street Journal about text messaging lingo includes this scene:
Within seconds, Josephine's phone beeps with a message from Richard, her boyfriend. "WAN2CAPIC?" reads the small screen. "He wants to see a movie," she explains. They agree to see "TRFC" at a theater near Piccadilly Circus. But she's still fuming at Sophie for standing her up, so she taps in a "screaming face" ":-@!" to express her displeasure. Why not just telephone her? "This is easier," she says.
How can reading a tiny screen and writing using tiny keys be easier than talking on a phone? Well, the mechanics themselves are not easier. Easier may be the wrong word. Convenient is more like it. See, making a call, you have to wait for the other person to answer. You also have to pay attention to what the person says right there and then, in real time, as they speak. With text messaging you decide when to pay attention. You can comprehend at your own pace. You can initiate and finish a communication without having to wait for the other person to "pick up the phone". People will find a way to use technology that makes things easier for them. It's not that a device's interface is easier, but that a task or objective is easier to accomplish with technology (even, sometimes, if the technology is difficult to use).
Just scanned a thread on Slashdot where someone asked for advise on software/coding solutions for creating formatted reports of several hundred pages. The answer is simple: don't do it. No one reads reports that long in either digital or paper form. People do ask for reports that long. People who feel a need to prove that they have important things to do, like reading several hundred page reports, ask for such reports. Of course, no one knows what they do after plowing through several hundred pages of data, except to ask for more reports (perhaps to validate what they read in the first report?). There are some people in some organizations who would provide value (perhaps tremendous value) from plowing though such massive reports. If plowing through that much data would provide value, however, wouldn't it make more sense to give the person a way to wade through the data directly themselves, rather than pay (in time or money) a developer to create a system for generating canned reports? If you are sucking tons of data out of a computer and putting it on paper so someone can look at it, both you and the person who wants to look at the data that way are doing something very, very, wrong. You're not creating value, you're only spending money.