Book Review: Crossing the Chasm

I've heard people make references to Geoffrey A. Moore's Crossing the CHASM book for several years now but had't read it until this past week.

Moore's book is a must-read for any IT company trying to launch a new product.  Although the concepts in the book are not novel (so admit's Moore) the book brings a vocabulary and metaphoric dictionary to the readers allowing marketing groups, investors, and techies alike to communicate about the playing field in a proactive manner.

Moore discusses the importance of delivering continuous innovation, instead if discontinuous innovation.  Our new innovations need to help people do what they are already doing better, and not force them to abruptly change something that kinda works for something that they are not sure about that may possibly work better.

Moore introduces the Technology Adoption LifeCycle, complete with five categories of market segments.  He discusses how to market in succession to each group:


  1. Innovators

  2. Early Adopters

  3. Early Majority

  4. Late Majority

  5. Laggards


Finally, Moore introduces some business concepts you may have heard of by now, like the bowling alley, the tornado, and the fault line.

If you haven't heard of these, then you need to get reading!

Mi Berry
www.RedRockResearch.com

Book Review: The Book of Five Rings

Recently, while attending the '09 Agile Roots conference in Salt Lake City, UT, Alistair Cockburn--the keynote speaker--referenced Miyamoto Musashi's 16th-century book called The Book of Five Rings.

I like Asian philosophy (and swords and such) so I picked up the book and read it.  The book was written in 1643 by an undefeated Japanese samurai master who was so effective he was rumoured to have spent the latter part of his career entering sword-fights purposely without a weapon.  Although meant as a battlefield manual, the book has gained popularity as a handbook for conducting business in the 21st century.

The book was translated into English by Thomas Cleary at some point and the edition I read was published in 2005.   Improperly named "The Book of Five Rings," the book is actually a compilation of five scrolls.

The Earth Scroll: Musashi talks about how a straight path levels the contours of the Earth and how various occupations provide life-improving principles.  He talks about observing patterns and learning from them.  Certainly a great primer for any business trying to get across the chasm.

The Water Scroll: Here Musashi talks about how water conforms to the shape of its container.  He suggests a separation of one's inward mind against it's outward posture, maintaining that one's control over one's mind must not be relinquished to outward circumstances.  He translates these philosophies into about 80 pages of sword fighting techniques.  An interesting modern parallel is found in Jim Collins book, Good to Great, where he talks about how the most successful companies are able to say 'No' and not be influenced by immediate but non-strategic opportunities.

The Fire Scroll: As with any book written by a 16th century samurai master, you'd expect a core discussion on combat strategy.   The fire scroll is full of combat strategies, positioning, and pre-emptive theory.  Very interesting.  Did anyone notice how Apple's announcement of the latest iPhone came about 1 day after the Palm Pre phone was officially launched--killing it's market blitz?  No coincidence there.

The Wind Scroll: The wind scroll contains a directive to study and be aware of your opponents techniques.  Translated into business speak, this means one should always study ones competitors.  Be aware of new offerings, partnerships, markets, etc. that they persue.  Emphasis is placed on observing rhythms and strategically harmonizing, or dis-harmonizing with them as appropriate.

Finally, The Emptiness Scroll:  This scroll discusses the value of escaping personal biases.  Emphasis is placed on not lingering on past situations and being able to adjust quickly to new scenarios.

Overall I found this book 'enlightening' to read.  If you like metaphors and inferences, or sword-fighting, then you will enjoy this book.

Mike J. Ber />www.RedRockResearch.com

Anti-Values

I was sitting in a KFC eating lunch, reading the slogans muraled on the wall.  This particular KFC is supposedly the first KFC in America.  Yes, it's in Utah.  Along with some chicken legs and a drink, you can enjoy a small exhibit showing Colonel Sander's original briefcase, white suite, shoes, etc.

One mural read, "Somehow we'll do it, by the principles of thrift, honor, integrity, and charity."

I thought for a moment.  Some of the financial service companies I've worked with would fail if they valued charity.  Then I thought about how trust is a wonderful interpersonal dynamic, but the companies I've worked with in the medical field allow no latitude for trust.  Everything must be written down and authorized by a credentialed physician.  Walk into a pharmacy and you'll need a signature on piece of paper to get a prescription filled.

Hmmm, just like charity is an anti-value in the financial services industry, trust is an anti-value in the medical industry.

I spent the day thinking about this new concept.  I owe the title of 'Anti-Value' to the Discovery-Channel documentary about Anti-Matter I was watching the night before.  I  guess I'm coining the phrase here, but it makes a lot of sense to me.  Normally, a value is something our society charish's, yet in a particular situation, or line of business--it becomes the wrong thing to do.

I started seeing how this concept can be applied all over to help clarify the decision making process.

I remembered taking third place instead of second in a Maryland school-district programming competition in high school because I let the guy from our rival high school cut in line in front of me to turn in his test.  When the results were announced we had both scored the same grade, but because he handed his paper in first, he won second place and I won third. (I beat him in the State programming competition the following month.)

I've never forgotten this experience, and actually now that I think about it, offering your competitor any leeway is an anti-value.

Some business meetings I've been involved in are a collage of participants cutting other participants off mid-sentence to make their point known.  Rude? Yes.  But, in fact, politeness may be considered an anti-value in these types of situations.

I think the concept is fascinating.  Just as a good value system should be in place to help an organization, department, team, or individual govern their decisions, an anti-value system can compliment a value-system by providing additional clarity for the decision making process.

One example of this is the U.S. government's policy on dealing with terrorists.  The government values having a "no negotiating with terrorists" policy.  As a disincentive to future terrorism, they have an additional policy to provide or produce exactly the opposite of what the terrorists are demanding.  The notion--to give them what they want--really becomes an anti-value, and is an additional input to the decision-making process.  So, in fact, their policy is set by values, and anti-values.

I hope you find this concept as fascinating as I do.  It was the best $7.79 I've spent on lunch in a while.

Mike J. Berry www.RedRockResearch.com

Three Dimensional Value Systems

What is a value system?

As of late, corporations have discovered that mission-statements are only somewhat helpful in providing direction to a company.  Being strategic in nature, they don't provide enough detail to govern tactical decisions made by the corporate employees on a daily basis.

To answer this need, value-statements, and value-systems have come into vogue.  Many companies have value-statements to underscore their mission statements.

Just as some mission statements are more effective than others, some value-systems are more effective than others.

The simple approach to establishing corporate, department, or team values is to get everyone together in a room and have them suggest values the team should adopt.  Voting happens, and the group committs to their agree-upon values.

After one of these sessions, the group might come up with a list like:


  • respect

  • trust

  • excellance

  • high performance


This list is a start, but only representative of a one-dimentional value system.  These values, by themselves, realy don't project any context or weight.

A more effective approach would be a two-dimensional value system.  A two dimensional value-system provides a greater context fabric.  For example, you could say your group values:


  • respect over cynicism

  • trust over hope

  • excellence over heroics

  • high-performance over sub-optimization


These comparison value statements proved direction and context.  This represents a two-dimensional value system, and is more effective that a simple list of values.

A three-dimensional value system is a prioritized list of these comparison statements.  For example, you could say your group values these statements in this order:


  1. trust over hope

  2. excellence over heroics

  3. high-performance over sub-optimization

  4. respect over cynicism


This list shows that trust is the highest factor in inter-departmental dynamics.  It shows that excellence is more important than high-performance (so no cutting corners!), and that the group values trust, excellence, and high-performance more than respect.

Every group will have their own values and differences in priorioties, but putting a three-dimensional value-system in place with your team is a great step forward in building functional team cohesion.

Once in place, a reward-systems can be built around your value system to promote it' ectivness.

Mike J Berry
www.RedRockResearch.com

Great Mission Statements

Jack Welch, in his book, Winning, talks about how to create great mission statements.

He says most mission statements are dull, uninspired, and even unhelpful.  Most groups write their mission statement to describe only what they are in business to do.  While this is not wrong, it creates a whole bunch of mission statements that all look the same among competitors, and are not really valuable.

Welch suggests that a good mission statement not only describes what the company is in business to do, but how they are going to succeed at it.

For example, "We are going to sell lots of chickens," is not as effective as "we are going to sell lots of chickens by growing the largest free-range chickens and advertising their value to the industry."

Following his logic, I did some research and found some interesting comparisons:

Ford Motor Company in Europe's mission statement (couldn't find the U.S. mission statement anywhere online) is:

"Our Mission: we are a global, diverse family with a proud heritage, passionately committed to providing outstanding products and services."

OK, so Ford's mission is noble, but there is no explanation as to how they will succeed at their mission.  Compare this to Toyota's mission statement:

"To sustain profitable growth by providing the best customer experience and dealer support."

Toyota's mission statement expresses their intention to make money by providing the best customer experience and dealer support.

Indeed, their mission statement tells what they are doing and how they will succeed.  This is an example of an effective mission statement.

There is a business principle at hand here:  Ambiguity is the enemy to progress.  It's nice Ford wants to provide outstanding products and services, but there is no formula or direction given in their mission statement as to how they plan to do this.

Toyota states it will succeed by providing the best customer experience and dealer support.   Are they succeeding at this?

In 2007, Toyota became the largest seller of cars in America.  As customers, we vote with our money.  It seems then,  that they are providing the best customer experience, and are fulfilling their mission statement.

On a lighter note, Enron's mission statement is/was:

"Respect, Integrity, Communication and Excellence."

Mike J y
www.RedRockResearch.com

Book Review: Reinventing Strategy

I just finished reading Willie Pietersen's book, Reinventing Strategy: Using Strategic Learning to Create and Sustain Breakthrough Performance.

Pietersen first sets the stage for the rest of the book by underscoring the need for organizations to be adaptable.  He paraphrases Charles Darwin, concluding that is it not the largest, the strongest, or even the most intelligent of species that survive, but the most adaptable to change.  He explains that corporations need to start thinking beyond doing things right, to thinking about doing the right things.

He explains that vision is different from insight.  Vision is what the leader has in mind for the group.  Insight is what the group learns about their customers needs, through studying their customers.

Pietersen describes a four-step process he calls the "Strategic Learning Process:"


  1. Situation Analysis (Learn)

  2. Strategic Choices (Focus)

  3. Align the Organization (Align)

  4. Implement and Experiment (Execute)


This process provides the basic toolset for gaining insight, and turning that into vision.  Continuous learning is essential, Pietersen says, and he quotes Arie de Geus's observation that a company's "ability to learn faster than competitors may be the only sustainable competitive advantage" they have.

He continues, "Nature, in effect, suffers from two massive learning disabilities.  When nature fails, it doesn't know why; and when it succeeds, it doesn't know why...therefore strategic learning is at the heart of successful adaptation"

Pieterson's goes on to offer a formula for initiating change.  His formula is:

D x V x P > C

D = Dissatisfaction with Current State
V = Clear Vision for Change
P = Process for Getting it Done
C = Cost of Change

His formula suggests that if D,V, or P are not strong enough to collectively overcome C, change will not occur.

Pieterson concludes his book by suggesting Strategic Learning can be applied to our personal lives to enable personal growth.  Appling it to such topics as Emotional Intelligence, and Personal Renewal, the Strategic Learning process can help us throughtout our life.

Mike J Berry www.RedRockResearch.com

3 Dimensional Value Systems

What is a value system?

As of late, corporations have discovered that mission-statements are only somewhat helpful in providing direction to a company.  Being strategic in nature, they don't provide enough detail to govern tactical decisions made by the corporate employees on a daily basis.

To answer this need, value-statements, and value-systems have come into vogue.  Many companies have value-statements to underscore their mission statements.

Just as some mission statements are more effective than others, some value-systems are more effective than others.

The simple approach to establishing corporate, department, or team values is to get everyone together in a room and have them suggest values the team should adopt.  Voting happens, and the group committs to their agree-upon values.

After one of these sessions, the group might come up with a list like:


  • respect

  • trust

  • excellance

  • high performance


This list is a start, but only representative of a one-dimentional value system.  These values, by themselves, realy don't project any context or weight.

A more effective approach would be a two-dimensional value system.  A two dimensional value-system provides a greater context fabric.  For example, you could say your group values:


  • respect over cynicism

  • trust over hope

  • excellence over heroics

  • high-performance over sub-optimization


These comparison value statements proved direction and context.  This represents a two-dimensional value system, and is more effective that a simple list of values.

A three-dimensional value system is a prioritized list of these comparison statements.  For example, you could say your group values these statements in this order:


  1. trust over hope

  2. excellence over heroics

  3. high-performance over sub-optimization

  4. respect over cynicism


This list shows that trust is the highest factor in inter-departmental dynamics.  It shows that excellence is more important than high-performance (so no cutting corners!), and that the group values trust, excellence, and high-performance more than respect.

Every group will have their own values and differences in priorioties, but putting a three-dimensional value-system in place with your team is a great step forward in building functional team cohesion.

Once in place, a reward-systems can be built around your value system to promote it' ectivness.

Mike J Berry
www.RedRockResearch.com

Corporate Strategy Planning Simplified

What is Corporate Strategy and how do we deconstruct it?  Corporate Strategy can be simplified into two drivers:  Top-line and Bottom-line.  Top line is your gross revenue, and bottom line is what it costs you to obtain that gross revenue. Think about these as numerator and denominator drivers.  Together they make a formula that looks something like:

Yield(Investment)  x Market Opportunity x Accessibility
---------------------------------------------------------------------
Cost of (Development x Support x Sales & Marketing x Admin)

So, the basic idea, for a software company, is that if you have frequent software enhancements and new products that match a ripe market opportunity, and you let your customers know about it, then you can collect a lot of top-line revenue.  The trick is to do this while spending the least amount on the bottom line. What's interesting about this process is that bottom-line cost is somewhat predictable and standardized.  Meaning, it costs your company probably the same amount of money to hire a development manager and to get a building to put people in as it does the company across the street. 

In order to shave expenses from the bottom line, you need to understand every competitive advantage your competitors have and newer industry trends in technology and implement them yourself as much as possible. The numerator factors are really what's unique about your products or services that set you apart from the competition. The more relevant these are to the existing market appetite, and the more your customers know about them, the faster your top-line will grow.

Now, wasn't that simple?

Mike J Berry www.RedRockResearch.com

Why should Development care about Corporate Strategy?

We code, right!? We code, and play Warcraft. Why should we know or care about corporate strategy? Well, the answer is that most programmers probably don't really know what their organization's corporate strategy is. If you do, you likely have an outstanding manager who has learned that part of their responsibility as a manager is to communicate executive directives back to Development. A company that performs good 'Strategy Management' will do two things:

  1. They will broadcast their corporate strategy to all employees so that everyone can be on the same page.
  2. They will establish measurable metrics throughout the organization to determine how close everyone's efforts are to the decided strategy.

When this happens, an effective plan is for the Development department to adopt their own 'Department Strategy' that supports the Corporate Strategy. Then look for ways to measure how effective they are at pursuing that strategy.

For example, if your team has to report total hours for the week, reporting could be enhanced to include how many hours each programmer spends on each project. Then each project can be placed into separate 'strategy categories.' Then, time can be measured for each project worked on during the week, and a summary comparison can be presented to upper management showing that the Development department is 'following corporate strategic goals' by spending a proportional amount of time on projects that are aligned with various corporate strategies. If you are a manager and do this before you are asked to, you may even earn yourself a few stripes. Kapish?

Mike J Berry www.RedRockResearch.com