Adieu Simply Partnership

On Saturday, September 24, my friend and and former Sage colleague of mine, Rob Johnson, delivered the closing luncheon keynote at the last Simply Partnership Conference at the Bellagio Hotel in Las Vegas.

imageJennifer Warawa, the newly minted vice president of partner programs and channel sales for Sage Small Business Solutions, and her team, in conjunction with Kimberly Dorony and the fabulous Sage Events team, did their usually outstanding jobs in putting on a great event.

In addition to our keynote (slides below), Rob and I performed our version of Wear Sunscreen as a commencement address. Here is the text of the speech:

Rob: Ladies and Gentlemen of the class of 2011:

Ed: If we could offer you only one tip for the future, backing up your data would be it. The long term benefits of backing up have been proved by technologists everywhere whereas the rest of our advice has no basis more reliable than our own meandering experiences… We will dispense this advice now.

Rob: Don’t worry about the future; or worry, but know that worrying is as effective as trying to solve a network connectivity issue by using bubble gum. The real troubles in your life are apt to be things that never crossed your worried mind; the kind that blindside you in your office at 4pm on some idle Tuesday.

Ed: Do one thing every day that scares you.

Rob: Sing.

Ed: Don’t be reckless with your customer’s emotions, and don’t put up with customers who are reckless with yours.

Rob: Floss.

Ed: Don’t waste your time on being jealous of other Sage partners; sometimes you’re ahead, sometimes you’re behind…the race is long, and in the end, it’s only with yourself.

Rob: Always accept a mint if offered to you.

Ed: Remember the compliments you receive, forget the insults; if you succeed in doing this; tell us how.

Rob: Stretch.

Ed: Keep your old customers thank you notes but, throw away your old manuals.

Rob: Get plenty of calcium. Be kind to your knees, you’ll miss them when they’re gone.

Ed: Enjoy your mind, use it every way you can…don’t be afraid of it, it’s the greatest instrument you’ll ever own.

Rob: Maybe you’ll marry, maybe you won’t, maybe you’ll have children, maybe you won’t, maybe you’ll divorce at 40, maybe you’ll dance the funky chicken on your 75th wedding anniversary…whatever you do, don’t congratulate yourself too much or berate yourself either – your choices are half chance, so are everybody else’s.

Ed: Dance…even if you have nowhere to do it but in your own living room.

Rob: Read the directions, even if, like me, you don’t intend follow them.

Ed: Spend more time with your parents; you never know when they’ll be gone for good.

Rob: Be nice to your siblings; they are the best link to your past and the people most likely to stick with you in the future.

Ed: Understand that friends come and go, but for the precious few that you should hold on to, work hard to bridge the gaps in geography and lifestyle because the older you get, the more you need the people you knew when you were young.

Rob: Travel.

Ed: Spend some time in New York City once, but leave before it makes you hard; spend some time in Northern California once, but leave before it makes you soft.

Rob: Respect your elders.

Ed: Accept certain inalienable truths, prices will rise, politicians will philander, you too will get old, and when you do you’ll fantasize that when you were young prices were reasonable, politicians were noble and children respected their elders.

Rob: Don’t expect anyone else to support you. Maybe you have a triple A customer, maybe you have a wealthy spouse; but you never know when either one might run out.

Ed: Be careful whose advice you buy, but, be patient with those who supply it. Advice is a form of nostalgia, dispensing it is a way of fishing the past from the disposal, wiping it off, painting over the ugly parts and recycling it for more than it’s worth.

Rob: But trust us on backing up.

ET HORA LIBELLUM DELENDA EST

On My Tour of Zappos

Last Thursday, I had the privilege to tour the headquarters of Zappos in Henderson, NV just outside of Las Vegas with my friend and Sage partner Judy Thornell of Baytek. (Thanks, Judy for arranging the tour!) Without question Zappos is an amazing organization. If you ever have the chance to go on the tour, I highly recommend it to a friend/colleague. (A little NPS humor there.)

imageAs soon as you walk in you notice, the place is loud. The lobby/reception area is like no other in that it bustles like a Las Vegas Strip street corner with friends (more later) walking through, talking and high-fiving. What is more this is clearly not an accident, the location was chosen precisely because it is busy. The Zappos culture is on display. It was further demonstrated by this pillow made from a tee-shirt that was on the couch in the reception area.

IMG_0506Jerry (in the red shirt at left) was the ringmaster. He greeted everyone warmly (and loudly) and peppered us with a series of one-liners throughout our wait. At one point, one of the tourists asked about where the men’s room was. Jerry replied without hesitation, “We just use the bushes out front.”

Our tour guide was the effervescent Rocco (on the megaphone above – I told you it was loud) whose title on his card is, I kid you not, Culture Magician. Throughout the tour he referred to his co-workers as “friends in department name” or “my fellow Zapponians.” The use of friends was genuine and did not sound odd, except the first time he said it.

The first and largest department we visited was the CLT – Customer Loyalty Team. This 24-hour a day team is talking on the phones, replying to email and conversing via chat. Chat is the newest part of the team which has increased from 11 people to 55 in the last year. Their mantra which they shouted to us as we walked by is, “Once you go chat, you’ll never go back.” Too funny!

IMG_0507

Every new hire regardless of their position with the company does four weeks of CLT training (that is what they called it). This serves two purposes: 1) it instills the Zappos values and 2) it serves as a backup for their busy Christmas season. Since everyone has done time at CLT they can all pitch in rather than hire temporary workers who do not understand the culture. Brilliant idea!

If the new hire is on the CLT, they then serve an additional three weeks of what is called “incubation: before they are fully on the team.

Every six months the CLT undergoes what is called a “shift bid.” This is where the teams reshuffle and through a bidding process people move from shift to shift or from subteams (like email) to subteam (like chat) in the CLT.

We then met the gal who holds the record for the longest call – 8 hours and 25 minutes. Someone on the tour asked if she took a bathroom break. “One,” she replied. They are currently producing a video about it, but in the meantime you can view this one about the previous record holder, Jennifer S. Her call was a mere four hours!

One of the coolest employee program that Rocco mentioned was the  concierge service for all employees. They can drop off their dry cleaning, get their cars detailed, or even, have a gift purchased for a loved one. Now this is not a free service, the employee pays a fee, plus the price of the purchase, but again, it is a stellar idea.

Next up where the friend on the legal team. For privacy purposes they are the only team that has offices and even they are decorated with big red awnings that are too big for the narrow hallway. CEO Tony Hsieh has a cubical on what is called Monkey Row because it is decorated like a jungle. “Don’t worry, the fire department has approved,” we were told by Rocco.

On the subject of the CEO, we introduced next to the FACE team (they have lots of acronyms, but they are very self effacing about them). FACE stands for Folks that answer CEO email!

Near the end of the tour we were given the opportunity to set in their Royalty Chair. This area is a restaging of a room we saw on the tour previously where friends go to work through and personal goals with a coach. When they achieve their goals they get to sit in the chair. Below is my picture in the chair which they posted on Twitter.

IMG_0509

 

After the tour Judy and I stayed for a brief round of Q&A with Rocco and Renea another tour guide. Perhaps the best answer was in response to a question on following process. “You don’t have to follow our procedures just get the job done,” Rocco responded.

PS – I learned about the Zappos app on iPhone during the tour. Mind you, it is unlikely that I personally will buy anything on it. This is not a reflection of the app, but the fact that my wife Christine is in charge of any and all wardrobe purchases. What is significant is that I showed it to my sister-in-law who initially poo-pooed it saying, “I like to go into shoe stores so I can see and touch and smell the leather.” Well, after five minutes of playing with the app, she said, “I am smelling the leather!”

On Benchmarking and Elvis

Unemployment numbers notwithstanding, the US economy has picked up ever so slightly in the past few months based on the anecdotal “evidence” from people I talk to. With that there has come a bit of a resurgence of the concept of benchmarking.  Notice no one benchmarks in a down economy.

The problem as I see it, is that benchmarking promotes what Jonas Ridderstróale and Kjell A. Nordstróm call Karaoke Capitalism – a propensity to imitate rather than innovate. Their message is essentially, “Look, no matter how drunk the audience (prospects and customers) gets, you are still not Elvis (Apple).” Benchmarking kills innovation and this is a death knell for most companies. Do think Apple benchmarks?

In the past, I was a disciple of this kind of thinking and attended dozens of benchmarking sessions at business conferences until I noticed one of two universal reactions in both myself and the other participants.

  1. If my company outperformed the average, I thought, “Well, I guess I am OK there. There is no reason to make any serious adjustments. After all, we are better than average.” The result – inaction on my part.
  2. If my company underachieved when compared to the mean, I thought, “Hmmm, I think there might be something wrong about this data.” I would begin to ask questions, not about how I could improve, but rather about the data set. “How many companies including were under X number of people? How many companies also did software development? How many did not have a training center?” The result – inaction on my part.

Now that I have seen the light (thanks mostly to Ron Baker) I have been a constant bane to the existence of those that attend these session. I share my story and ask the participants as they exit the room, “What specifically are you going to change about your company now that you know this information?” The usual response is stuttering followed by an expression of either or both of my observations noted above.

I want to be clear, I do not think action should be taken based on this data in the first place. Why? Because ultimately we (myself and those attending the sessions) were right about this data – it is not scientific! In many cases the data is not even a valid statistical sample set from the pool of companies that is attempting to be benchmarked. Comparing ourselves with a mean means nothing. On average every person on the planet has one developed set of mammary glands and one testicle. So what! Who cares?

Lastly, also almost all benchmarking data is based on numbers available from the financial system, which by definition are accounting for what happened in the past. None of these numbers is a indicator or predictor of future success.

Instead of filling out forms and attending benchmarking sessions, I suggest thinking about how to innovate and create value for your customers today and in the future!

ET HORA LIBELLUM DELENDA EST

The Diamond Planet

A recent cosmological discovery got me thinking once again about the what George Gilder and others term the materialist fallacy. From a Reuters report from last Thursday:

An exotic planet that seems to be made of diamond racing around a tiny star in our galactic backyard in an undated image courtesy of Swinburne University of Technology in Melbourne. REUTERS/HandoutAstronomers have spotted an exotic planet that seems to be made of diamond racing around a tiny star in our galactic backyard.

The new planet is far denser than any other known so far and consists largely of carbon. Because it is so dense, scientists calculate the carbon must be crystalline, so a large part of this strange world will effectively be diamond.

Materialists, including many of my Libertarian friends who favor a return to the gold standard, will have to conclude:

  • This planet is more wealthy than we are. After all it is a diamond with the mass Jupiter.
  • We would be better off if this heavenly body were to break free of its orbit and be sent on a path to impact (or maybe just orbit) the Earth. Perhaps T. Boone Pickens and DeBeers can concoct a plan to (as they say in the Beltway) “effort” this.
  • The really good news is that there are likely more of these throughout the galaxy and universe for it is only recently that we as a species have been able to detect these orbs.

This is materialist wealth creation at its finest!

Side note and bonus material:

I am not sure why, but my brain was reminded of this classic Bugs and Daffy cartoon. Enjoy!

ET HORA LIBELLUM DELENDA EST

On Hauser’s Law and Soaking the Rich

Whenever the subject of the deficit comes up, many well-intentioned people make the suggestion that we should repeal all or some of the Bush tax cuts and that this will go a long way to at least beginning to fix the problem.

Often times this graph (or one like it) is used in support of this notion.

First, let’s keep in mind that this is the deficit, the annual shortage when one compares money spent to money collected. This is different from the national debt which measures the sum total of the deficits.

On its face, it would seem that raising taxes (or eliminating the Bush tax cuts as some prefer to say) would be a reasonable approach. The problem is that the blue line above assumes that all taxpayers would leave their behavior unchanged. This is demonstrably false through what I have come to find out is called Hauser’s Law.

What this graph clearly shows is that raising taxes actually has little to no effect on money collected as compared to GDP. Why? Because taxpayers do change their behavior. The wealthy will shift money using tax sheltering or even move it out of the country.

What is worse is that which is unseen – The slowdown of the economy that would result from this activity. So what is to be done?

There is only one viable answer – reduce the size of government.

ET HORA LIBELLUM DELENDA EST!

Thinking Differently

At a recent conference one of the speakers presented the following syllogism:

  • What drives a company –> sales
  • What drives sales –> marketing
  • What drives marketing –> data

The implication is clear, ultimately data drives a company. Unfortunately, this thinking is all too prevalent in the business world (perhaps, just the world, leave business out of it).

It is also wrong. Actually, it is not just wrong, it is confusing cause with effect. Data is not the cause of company activity, it is the effect of it.

Instead, I would like to posit the following syllogism:

  • What drives a company –> profit
  • What drives profit –> creating value for customers
  • What drives value for customers –> innovation
  • What drives innovation –> knowledge
  • What drives knowledge –> relationships (conversations)

In my chain it is relationships that ultimately drive a company.

Thoughts?

My Sessions at Summit 2011

With registration going live for Sage’s partner and customer conference Summit 2011, I thought it would be helpful for those who might be attending to have a list of my sessions.

In the table below, session codes beginning with P are for Partners and those beginning with C are for customers. Sessions that are repeated for both partners and customers have two codes and two day, time combinations.

Code Session Title Day, Time
P-CHN15 Ed Kless’ Session on Advanced Consulting (or Beethoven’s Night Out) Sunday, 1pm

P-CHN10

Advanced Topics on Setting Price (with Ron Baker) Monday, 11am

P-CHN08

Creating a Great Scope Document Tuesday, 8:45am

P-CHN12

Killing the Timesheet: Yes It Can Be Done (panel moderator) Tuesday, 2pm

C-CHN02

Creating Shared Vision in the Small Business Wednesday, 8:30am

C-CHN03

Creating Strategy in the Small Business Wednesday, 10:15am

C-CHN04

Project Initiation: How to properly initiation a project in a small business (with John Shaver) Thursday, 1:15pm

C-CHN10

In Defense of Business

Thursday, 3pm

 

In addition, here are some other sessions that are being presented by friends and colleagues, that if I were you, I would attend.

Code Session Title Day and Time
P-CHN14 and        C-CHN07 Will, Skill, and Drill: How to Sell More Than You Ever Thought Possible (Rob Johnson) Monday, 11am and Thursday, 10:15am

P-CHN09

Baker’s Dozen: The 12 Business Books You Must Read and Why (Ron Baker) Monday, 2:15pm

P-CHN11 and        C-CHN11

Understanding Emotional Triangles: A New Leadership Mental Model (Howard Hansen and Steve Geske) Monday, 4pm and Wednesday, 1:30pm

P-GEN12

Putting Sage Consulting Academy to Work in Your Organization (John Shaver) Tuesday, 10am

P-CHN13

Selling in a Competitive Environment: A Primer (Rob Johnson) Tuesday, 2pm

C-CHN05

Basics of Selling (Rob Johnson) Wednesday, 8:30am

C-CHN09

Turning Your Customers’ Experience Into a Competitive Advantage (Dennis Frahmann) Thursday, 10:15am

C-CHN06

Customer Panel: Developing an Internal ROI Document Thursday, 4:30pm

Customer Service Transparency

MAS 90 Guru, Wayne Schulz told me about a cool customer service feedback mechanism that 37signals uses. 37signals are the creators of TypePad, MoveableType and other blogging solutions Basecamp, Highrise, Backpack, and Campfire, all web-based collaboration software solutions.

imageWhat they do is post, for all the world to see, the rating of there most recent 100 interactions with customers on a simple three point scale: great, just OK, and not so good. They tally the ratings and post them on a real time basis.

This is brilliant. It is simple, easy to understand, and I would think relatively easy to do.

How about doing them one better and posting it on your home page?

Forget Being Effective, Be Efficacious

Most of you, I am sure, are familiar with the scene in the classic movie Spinal Tap, in which Christopher Guest as Nigel Tufnel utters the immortal words, “These go to 11” about his beloved Marshall Amp.

“It’s one louder,” he intones.

 

As foolish as Nigel appears, he is making an important philosophical point. He is seeking the maximum total benefit from his amp and for his fans in the audience. In short, he is striving to be efficacious. This desire, to seek the maximum total benefit for a customer, supersedes in my view our desire to be effective – seeking to produce a benefit or result for a customer.

The problem is that if you are focusing on just being effective (seeking a benefit/result), there could be a perception on the part of a customer and temptation on the part of a consultant to see fixed price agreements as a way to maximize your profit and not on your customer’s profit. Focusing on efficacy (seeking maximum total benefit) removes this perception and temptation.

As an aside to those of you still mired in the efficiency v. effectiveness debate: you are now behind by two generations in thinking!

I am sure that there are those of you who believe I am taking this debate of semantics to the nth degree. I am, but I am just being efficacious.

How is your product/service/knowledge efficacious?

Cool New Tool – tungle.me

imageMy thanks to Sage partner Wayne Schulz at Schulz Consulting for turning me on to tungle.me. This free (there is a paid premium edition as well) web service allows you to publish your calendar to the tungle.me site where your customers can see what your available time is and propose scheduled meetings.

In addition, you can add a widget to your web sites, see mine at the top right of this page.

Effective immediately, if you would like to have a conversation with me, please click on the widget and enter the information as instructed. You must propose at least two possible times to connect.