February 09, 2008
There are many ways that effective leaders make things happen. And leaders aren't always executives. Leaders are people who have a vision, who get things done, and are able to get people to follow them.
Sometimes you need to get your CEO to follow you. Believe it or not, your CEO wants to follow you. She can't possibly come up with all the ideas on her own.
Here's seven ways to get your CEO to follow you.
Just Do It
I know of an employee who wanted to start a blog. This employee presented the idea to the executive. The executive turned the idea down. A day later, the executive asked the employee why the employee didn't just execute the idea, guide it to success, then ask for forgiveness? The executive couldn't possibly authorize the idea, but could have potentially saved the idea if it had been implemented and become successful without the knowledge of the executive.
Seasoned employees, those trusted by leadership, have a longer leash than those who are new to a company. Sometimes the idea needs to be implemented in order for leadership to understand the potential of the idea. The seasoned employee gains much by learning how to read the tea leaves.
Profit And Loss
Two employees have an idea. One has a beautiful powerpoint presentation, chocked full of facts and figures and market research. The other employee has a simple presentation, but presents two profit and loss statements --- one illustrating minimal risk, one showing a reasonable expectation of potential.
Over time, the latter presentation has more potential for success than the glitzy powerpoint presentation. Know your facts, but also know the profit and loss implications of your idea.
Budgets And Timing
Ideas are more likely to succeed at the start of a fiscal year, and at the end of a fiscal year. Your CEO has a budget for projects. At the start of the year, that budget is full of money. At the end of the year, especially if your company had a good year, there may be money left in the budget that can be spent. Time your presentations around the rhythm of your fiscal year accounting cycle.
Evangelize The Idea
Back in 2002, I was the VP of Direct Marketing at Nordstrom Direct, the catalog/online channel at Nordstrom. Our employees were divided. Some liked catalogs, and believed that catalogs were the reason the website was so successful. Others loved the online channel, and thought the catalog folks represented a fossilized group of old-timers.
I took a presentation "on the road". I scheduled meetings with every department at Nordstrom Direct, illustrating to every employee how the combined efforts of all team members contributed to a happy customer, reminding each employee that Nordstrom was about pleasing customers, not about in-fighting over which channel was most important.
Sometimes, you sell your idea to the masses, not to leadership. When the masses align on a concept, leadership falls in place.
Be Humble And Confident
Leaders listen to humble, confident employees. Leaders are turned off by arrogant employees.
Align With Leadership Objectives
Ideas that foot with leadership objectives have a far better chance of succeeding than ideas that do not, on the surface, help leaders accomplish their objectives. Your CEO wants to be successful, and will do what it takes to keep her job. Help her succeed, and you succeed in the process.
Is your idea really important to you? Instead of fighting a battle you can't win, find a company that believes in your idea, and become a happier employee in the process.
September 30, 2007
The vendor community and blogosphere are beating companies up over "silo" based approaches to leadership, blaming business-to-consumer companies for shortcomings (in some instances, vendors are publicly blasting the very companies that pay their freight --- I saw this happen just last week --- not a great way for a vendor to endear themselves to a client).
It is my opinion, having worked in leadership roles in some of the biggest companies in America, that org structure and silos have very little to do with coordinated marketing activities or brilliant execution of projects.
Nope, whether things get done or not have everything to do with how people work together.
Explain to me why Brett Favre, given a motley crew of rookies and one of the worst running games in history, has led his team to a 4-0 record and an average of 26 points a game?
Strong leaders are able to motivate people. They align people along common goals and objectives, and demonstrate to all how everybody benefits. They motivate people to accomplish great things. They give credit to others.
And regardless of org structure, they get things done.
Catalog Marketing, E-Mail Marketing, Search Marketing, Online Marketing, Multichannel Marketing ... all would benefit from the process of developing leaders. We need fewer folks leading contentious environments. We need more leaders.
What do you look for in a leader?
June 28, 2007
For eight weeks, from 9:00am to 11:30am, 1:00pm to 4:30pm, and 6:00pm to 8:30pm, four days a week (closing down at 5:00pm on Friday), I was partnered with a young lady. It was our job to corral anywhere between ten and forty youngsters, ages five to maybe sixteen. We had to plan activities that weren't too advanced for the five year olds, weren't too childish for the sixteen year olds.
There wasn't a better management lab than playground supervision. Some kids were needy, some were mean, some were sick, some were shy, some were outgoing. We earned $4.00 per hour, considered a good summer wage at the time, trying to balance the needs of three dozen kids.
We had maybe eight or nine playgrounds across the city of Manitowoc. Attendance at each park was directly tied to the environment created by the playground leadership team. Some parks had a half dozen or dozen kids during each session. Other parks had between thirty-five and fifty kids attending each session. All it took was effort, activities and kindness to bring the kids in.
I recall there being a sixteen year old who liked to stir up trouble. Overall, this kid had a good soul. But from time to time, he liked to pick on various people. Each Friday morning, we spent several hours at the municipal pool. His job was to drown me. My job was to let him drown me. Our management team thought it was good for the kids to try to torment us in the pool. At times, I'd have six or seven teenage boys trying to drown me. Those were heady times. Imagine what a lawyer would think of that in the year 2007?
After a few weeks of incessant horseplay, I became frustrated. It became my mission to find a way to "get even" with this kid.
My opportunity came during a game of dodgeball. This young man was standing all by himself, no more than fifteen yards away from me. I had a perfectly-sized playground ball in my right hand. Seeing the opportunity to toss this ball at a high velocity toward the teen's belly, I reached back, and with all the strength I could muster, catapulted the ball toward the bully.
The young man was quite agile. Realizing this whistling weapon would cause undue damage to his abdomen, he dove to the ground, his face full of fear.
As the teen hit the ground, I saw a young boy, five years old, standing maybe ten yards behind the teen. This young boy was not watching the epic struggle between sixteen and twenty-one year old. No, this boy was probably daydreaming about strawberries or frogs or Max Headroom.
No sooner than I could yell "Watch Out Harold!", the projectile struck the innocent youth flush in the left cheek, pushing Harold's head back at the velocity of the playground ball. The force of the impact lifted Harold's tiny little feet airborne, much like a teeter-totter. The back of Harold's wee-little head hit the pavement first, followed by his hands, buttocks, and finally, his previously airborne feet.
Lord knows how Harold felt. I know how I felt. I realized that I may have killed Harold!
Five seconds later, air returned to Harold's lungs, and he began to cry at decibel levels reserved for jet airliners. At that moment, forty children, a mortified playground leader, and a laughing sixteen year old bully stared at me like I was the anti-Christ.
No amount of apology solves a problem of this magnitude. I remember Harold wiping the tears off of his little face, a face that was half pale, half bright red, swollen slightly out of proportion. He quietly sobbed as he walked to his bike, mounted the vehicle, and peddled home.
Harold never came back to the playground.
As leaders, how often do we inadvertently do harm to the employees placed in our care? How often do our petty battles and problems with various leaders cause situations that spill over and impact folks like Harold? Worse, how often do we not notice the damage we do?
April 29, 2007
Have you ever evaluated the language you use, when speaking with Senior Management?
Database Marketers are in a challenging situation, when it comes to communication. You cannot share the technical aspects of your work with anybody outside of your company, because your work is proprietary to your organization.
In some instances, you can use "coded" language to speak with peers. I recall attending what used to be called the "catalog conference", back in 2001. Two of my managers and I were to meet with the executive and two managers of a competitor of ours. Our list management vendor organized the meeting. We had six of us from our two companies, and ten individuals from at least three list vendors, sixteen folks in total. In a small hotel room. One bed. Maybe five chairs. One hour. A small assortment of Diet Coke and Seven-Up.
I wouldn't share the true state of our business (we were missing plan by high double-digits), my peer from across the hotel room wouldn't share the true state of her business. I recall saying that "business was close to meeting our re-forecasted expectations, and that we were optimistic about some of the changes were were implementing". That's "coded" language, alright! It's not easy to say that the internet is destroying our business model, and that we'll be lucky to have three of the sixteen folks in the room still in their jobs in five years.
So we use "coded" language when talking with folks outside of our company.
Within our company, we get a small number of opportunities to dazzle Senior Management. These are the two or three times a year we are requested to share business findings with the leaders of the company.
Unless the political climate stifles candor, this is our one chance to "rock somebody's world". So we craft a spectacular Powerpoint presentation. We try to cram facts, useful metrics, sage-like insight and strategic direction into the document, slide, or presentation. We share the slide with our co-workers. Everybody offers their opinion. A font should be larger. Cones should be red, not pink. One axis should be labeled, the other not because it is in the legend. Numbers should be listed above the cones, so that Senior Management can see the relationships, or read the actual numbers. An appendix is included, with all of the detail. We're ready!
We dress up for our meeting. We wear extra deodorant. We might spend $75 coloring our hair. Appearance matters!! We arrive to work early. We kibitz about the meeting with co-workers. We chew on a few mints. And then we're called into the boardroom.
Inside are thirteen stressed, semi-pleasant individuals. Some give us a half-hearted smile. Our Vice President introduces our team, and invites us to share our findings.
We present our carefully constructed slide, and after six minutes of explanation, everything goes sideways. One member of Senior Management wants to know the difference between DMPC, Dollar-Per-Book, RFM, Click-Thru Rates and Shopping Cart Abandonment. Another is busy using her thumbs to type a text message to a member of the information technology team via her Blackberry. The gruff individual at the end of the table just received a written message on a pink piece of paper from his administrative assistant about a labor dispute at the distribution center.
We spend another three minutes desperately trying to save the presentation. We answer a few pointed questions, we perceive that the entire Executive Team completely misinterpreted our work, we cringe when they decide to do the exact opposite of what we recommend.
And then the worst part of the meeting happens. The CEO looks directly at us, and tells us that next time we are to avoid using "geek-speak", to "stop using so many numbers". "Just tell me what I should do." are the words we're left with as we leave the board room. We're convinced that "management doesn't get it".
In my new role, I see this happen repeatedly. Well-meaning Database Marketers, Web Analysts, Catalog Circulation Experts and Online Marketers use the language of their peers, their niche, to dazzle Senior Management. Senior Management just gets crabby, in response.
When business is good, our language, our "lingo" is tolerated. When business is bad, we're just 'geeky twits'. Our credibility is hurt.
It can be tough to be in our profession. We can't share much with our peers, folks at other companies who would understand us. Our leaders don't understand our jargon, our communication style.
In my final months at Nordstrom, I recommended we talk like "we were talking to Oprah". Sometimes, it has to be simplified to that level --- simplified so that Oprah's entire audience can understand it. This at least gives your Executive team a fighting chance!
The art of storytelling has never been more important in Database Marketing. Business models are being transformed, and Executives don't know how to interpret what they are seeing. Find everyday language that is culturally appropriate, and create a niche for yourself (or a co-worker of yours) as the "translator" ... the person who takes technical information and converts it into everyday language that an Executive can understand.
April 09, 2007
"But, as one statistician to another. Are you not in danger of making unfounded generalisations about blogging based upon a hugely inadequate number of observations."
The answer to Graham's question is "YES"! I'm absolutely in danger of doing this! Graham's comment is insightful and correct.
Early in my career, when it was my job to be a statistician, it was my job to be "right". I made sure that my work was perfect, that my conclusions were rock-solid and air-tight. I was given months to complete a project. Those were good times.
In 1998, I became Director of Circulation at Eddie Bauer. I was member of the "Catalog Business Team", a group of Directors and VPs responsible for meeting or exceeding budgeted sales and profit goals for the Catalog/Online division at Eddie Bauer.
We met as a team every Wednesday morning.
Questions would come up, questions that required rapid answers. For instance, the Merchandise executive might say "We're killing this business by running Mens merchandise in the first twenty pages of the catalog. Let's stop this practice, and run best-selling Womens merchandise in the first twenty pages."
Maybe we ran Mens merchandise in the front of the past two catalogs, and maybe those two catalogs were ten percent below our expectations, whereas the prior five or six catalogs met expectations. On the surface, the merchandising executive seemed to have a point.
As a statistician, you'd like to run a series of experiments, and prove that Mens merchandise was killing the performance of the book. However, these experiments required many folks in print production and creative to create various versions of the catalog. Once created, it would be close to two months before the print production process was completed, resulting in catalogs being mailed to customers. Another month needed to go by before a proper statistical analysis was completed.
So, sitting in this meeting, my choices were to recommend a three month process to test the hypothesis in just one catalog, or to quickly review as a team the past eight catalogs in an ad-hoc, unscientific manner, and make a decision as a team before leaving the room.
It requires a lot of patience to learn the balance between making ad-hoc, gut-feel decisions and doing a thorough, accurate statistical analysis. You never really perfect the balance, you make mistakes, and you make the right decisions.
The key factor in this is that you "make decisions". Decisions, positive or negative, move a business forward, increase accountability, and reduce red-tape.
I once met with my marketing Vice President, when I was a statistician. I wanted a lot of time to do an analysis "the right way". He told me that he'd rather make five decisions with 80% accuracy than make one decision with 100% accuracy, because at the end of the day, you'd make four correct and one incorrect decision, whereas the "right" approach yielded only one correct decision. He preferred to make four right and one wrong decision each day than making one right decision.
I've tried to balance his viewpoint with my statistical heritage of "being right". I've always admired the leader who is decisive, makes four right and one wrong decision, and takes accountability for the wrong decision.
April 01, 2007
If you have profit and loss responsibility, your year is at an interesting inflection point. Most of the folks working in our multichannel businesses don't get to see the interplay between executives, especially when sales levels are not meeting expectations.
The merchandise executive feels a lot of pressure. Her merchandise is not selling, and there could be many reasons for this. Maybe the database marketing executive didn't mail the right customers. Maybe the online marketing executive isn't attracting the right traffic to the site. Maybe the brand marketing/creative leader is depicting the merchandise in an unflattering manner. She needs help understanding what is happening in the relationship between her customers, and her merchandise. No focus group of nine individuals, no survey of 3,000 loyal purchasers will provide the insight she needs to make decisions today.
Working with merchants who take accountability for sub-par business results is an absolute blessing.
The inventory executive feels a lot of pressure. He is bonused on outstanding fulfillment, great gross margins, and rapid inventory turn. When the business goes south, he needs to liquidate merchandise quickly. He'll demand additional clearance catalog mailings, increased e-mail frequency, free shipping, 20% off your order, whatever it takes to sell out from under the pile of unwanted garbage the merchants bought. The customer experience becomes secondary to moving merchandise at any cost.
The database marketing executive feels a lot of pressure. She is often the first person to be blamed for sub-par business results. It is so easy to assume that the wrong customers were mailed catalogs, that the e-mail campaigns were not actually delivered to the customer, that the post office forgot to deliver 200,000 catalogs, that the techno-geeks who forecast sales made big mistakes. It is hard for executives to accept the fact that customers didn't want to purchase our merchandise. This is the time of year that the database marketing executive starts trying to craft a story about customer behavior --- a story that doesn't offend folks, but adequately gets her off the accountability hook.
The finance executive feels a lot of pressure. He knows that additional mailings, online advertising, price reductions, shipping promotions and any of a number of additional incentives will cause expenses to not leverage well against sales. He'll demand that the database marketing executive re-forecast the customer file, and re-forecast sales for the remainder of the year. The board/owner will need to know the expected profit impact of the sales implosion. The finance executive will take more heat from the board/owner than is deserved.
The brand marketing/creative executive feels a lot of pressure. She is trying so hard to provide an outstanding experience for the customer. She reads a dozen blogs that preach the critical importance of "managing the brand". She reads another dozen blogs that constantly harp on how brands fail to treat customers well, marketing blogs that take repeated potshots at companies for failing to meet customer expectations. Then she looks at her business peers, who are about to trample the customer experience to move merchandise at any cost.
How does she convince them that this is bad for the business?
Worse, how does she provide a viable alternative for clearing $10,000,000 of overstocked merchandise, one that doesn't trample the customer experience? Do any of the marketing bloggers have a credible, creative solution to this problem? How about the vendor community?
This is a key element of profit and loss responsibility that vendors, bloggers and pundits fail to appreciate. There is tremendous pressure to bail out the profit and loss statement, tremendous pressure to get out from under yesterday's poor merchandising decisions today, tremendous pressure to save one's job. Few of the options (discounts, promotions, price cuts, free shipping, additional mailings, additional e-mail contacts, you name it) are good for the long-term customer experience or are good for "the brand". Comments like 'the brand should have offered great merchandise that the customers wanted to buy in the first place' fail to solve the problems the executive has to navigate through today.
Without viable alternatives, the brand marketing/creative executive is in a no-win situation. You can see why the average Chief Marketing Officer lasts 23 months --- no viable short-term solutions to move overstocked product, no way to protect the customer from the impending onslaught of advertising of crappy merchandise, no way to truly succeed in her job.
The operations executive is nervous, because a continued downturn in business results in staffing cuts in the phone center and distribution center. Who wants to go through that experience?
The human resources executive deals with secondary issues created by stress. Employees begin snipping at each other. Some employees quit, heading instead for the lucrative surroundings of a successful business. HR is not a fun place to be during a downturn.
The information technology executive is nervous, because the executive team is demanding that website improvements be completed now, to improve business. The executive team also is demanding business intelligence solutions from information technology folks --- the executives want to know why customers aren't purchasing, and cannot articulate questions in a way that an information technology executive can effectively program into a report.
Profit and loss responsibility changes the way one thinks about a business.
When business exceeds expectations, it is easy to think about theoretical issues like return on customer, providing an exceptional customer experience, enhancing the "brand", developing new business opportunities, figuring out how to grow to three billion dollars in sales, giving customers a say in advertising, developing a CEO blog, you name it.
But when the business fails to meet expectations, all that fun stuff goes out the window. One bad year costs the executive her bonus. Two bad years costs the executive her job. Short-term decisions are made to save the profit and loss statement, to buy another six months of time to acquire new merchandise that the customer might want to purchase.
And when the company is publicly traded, all of these issues are magnified by shareholders demanding a return on investment today. Most of you reading this blog are indirect shareholders --- you have 401k accounts, and you're not patient when your 401k account loses value, are you? You indirectly contribute to the problems you openly grumble about.
One can see how special visionary leaders are --- the rare individual who can keep an eye on strategic, visionary issues, while navigating choppy waters every-other or every-third year.
Today's online marketing executives have not gone through a lot of these business cycles. The online channel has pointed straight up for a decade. It's only a matter of time before the pressures all executives feel are thrust upon our new generation of online marketing executives.
March 29, 2007
First, how well do you retain your customers?
- If you retain more than sixty percent of last year's customers (in other words, more than sixty percent of last year's customers purchase again this year), you are in Retention Mode.
- If you retain between forty and sixty percent of last year's customers, you are in Hybrid Mode.
- If you retain less than forty percent of last year's customers, you are in Acquisition Mode.
- Do they only purchase your products, brands or channels (called Isolation Mode)?
- Do they like to try out other products, brands or channels (called Equilibrium Mode)?
- Do they switch to other products, brands or channels (called Transfer Mode)?
- Do they switch back and forth between products, brands or channels (called Oscillation Mode)?
Let's evaluate Circuit City, as an example. It is well documented that customers shop Circuit City via the online channel, then either purchase merchandise in-store, or purchase online and pick up product in the store.
Retail executives manage channels that have very different dynamics:
- The retail channel frequently operates in Retention/Isolation Mode. In other words, last year's store customers purchase in-store again this year, and are not likely to shop other channels.
- The online channel frequently operates in Acquisition/Transfer Mode. In other words, last year's online customers are unlikely to purchase online this year --- instead, the customer shifts purchasing to the store channel.
The leader of the online channel should be collaborative, one who does what is best for the total business. Her bonus structure should be based on her ability to facilitate customer purchases within any channel, not just her channel. The strategic development of her channel should be crafted around the natural behavior of her customer --- to shop in stores in the future.
The leader of the retail channel can be a different individual. Teamwork skills and collaboration may not be as important, because this individual has customers who are not likely to switch to the online channel --- and if the customer does switch, it is only to get information about retail merchandise.
Multichannel retailing is all about exploiting the strengths of each channel. It is not about "sameness", not about replicating the customer experience the same way in every channel.
This holds true for the leaders of each product, brand or channel.
In the Circuit City example, it may make sense to have a very experienced leader manage the online channel. This leader should be well versed at collaboration, consensus, humility, leading through others. This leader should be comfortable with not getting credit for all the good she does to make other leaders look good.
Conversely, it may make sense to have newer executives work in products, brands or channels that are in "isolation mode". In these instances, the leader has control over things, and has fewer moving parts to worry about.
All too often, we assign new leaders to smaller business units, business units with the least "risk". In reality, we should think about putting our most talented leaders in the most challenging roles. Those roles tend to happen in "equilibrium" or "transfer" mode.
February 19, 2007
I spent seventeen of my nineteen professional years working for companies that sold at least a billion dollars of merchandise on an annual basis. As a result, I am probably a 'big company guy'.
Back in 2000, I spent ten months working at an internet advertising startup called 'Avenue A' (now called aQuantive). Within two week of being hired, I worked on a small team of four people. We created a product that we took to market just six weeks later. No red tape, no approvals, just a small company allowing a small group of individuals to use their experience and best judgement.
Compare that experience to things that happen in large companies.
During my time at Eddie Bauer, I was Director of Circulation. This meant I was theoretically responsible for determining the best way to determine how to mail customers catalogs. My job was to maximize sales and profit by determining an optimal catalog contact strategy.
In 1998, I wanted to add a catalog to our contact strategy. I determined who the target audience would be in this additional catalog mailing. I determined how many pages should be in the catalog. I determined the merchandise composition of the catalog. I determined the in-home date for the catalog. I calculated the expected net sales, profit, and ROI of this endeavor.
To get this decision approved, I had to do the following:
- My boss, the Divisional Vice President of Marketing, had to approve of my idea. He could alter the page count, merchandise composition, or in-home date. He could approve, alter or kill the idea.
- If approved, the Sr. Vice President of Marketing had to approve of my idea. He could alter the page count, merchandise composition, or in-home date. He could approve, alter or kill the idea.
- If approved, the Executive Vice President of Global Brand Direction had to approve of my idea. He could alter page count, merchandise composition, in-home date, and suggested creative presentation. He could approve, alter or kill the idea.
- If approved, I had to pass the idea past the Director of Inventory Management. She had to support the sales plan by making sure that merchandise would be available. She could alter page count, merchandise composition and page count. She could alter or kill the idea.
- If approved, I had to pass the idea past a team that I participated on, a team that focused on maximizing the catalog strategy. Our internet marketing leader, finance leader, operations leader, creative leader, and inventory leader could all alter the page count, merchandise composition, page count, in-home date, or creative execution. This team could approve, alter or kill the idea.
- If approved, I had to pass the idea past the Executive Management team --- a team of Executive Vice Presidents, and our President/CEO. This team could alter page count, merchandise composition, in-home date, and suggested creative presentation. This team could approve, alter or kill the idea.
Policy meant that many employees learned this idea was likely to happen. If powerful employees were opposed to the idea, they could lob the project back to any of a number of executives, who could begin the approval discussion process anew.
This process of iteration either resulted in a final decision, or resulted in the death of the project. Occasionally, there was not enough time to implement the idea, resulting in the death of the project.
Many big companies have better decision making processes than this. Many big companies have sub-standard decision making processes.
We wonder how big companies like JetBlue can completely ruin seven spotless years of brand equity with one day of bad mistakes. We wonder how Microsoft fails to compete with Google, or Apple, or a myriad of competitors. We wonder how Ford and Chevy implode when faced with foreign competition. We question why Dell plunders its brand heritage at a time when it needs to consider a viable online strategy amid significant competition. We wonder why record labels are busy destroying the music industry.
I have yet to work for a company led by 'dumb people'. It seems that problems occur when a bunch of smart, strong business leaders experience conflict, and are required to maintain sales and profit growth.
The self-organizing processes that occur when decisions need to be made become part of the culture of a large organization. Eventually, the culture becomes inflexible. The business struggles to be able to right itself, and focus on the change needed to survive.
I cringe when a pundit suggests that companies don't have the guts to ask questions. I have yet to work for a business that didn't have the guts to ask tough questions, or to make changes. That being said, every big company struggles to overcome a culture that formed over a long series of good decisions that led to successful business results.
Do you work at a large company, or a small company? Have you experienced the challenges I described in this article? What have you done to overcome these challenges?
February 13, 2007
I figured I could make magic happen, simply because I had a fancy title that demanded respect.
Within days, the cold reality of the business world humbled me. It would take a lot more than a fancy title to get things done.
Twelve thousand hours of work and maybe more than seven thousand hours of meetings later, I have learned how leadership and communication are forever dependent upon each other.
Here's an example of the importance of communication. Consider the following two statements.
Statement #1: We will be installing new campaign management software in April. Consultants will be here in March to learn everything about your job. These individuals will help us figure out how to be more efficient by using the new software in our day-to-day jobs. We expect some job responsibilities to change. Thank you for your patience as we work through this transition.
Statement #2: I have spoken with many of you about your job responsibilities. I have heard your concerns, and have observed the long hours you are working. In spite of repeated requests, management chose not to add staff to our department. Given management's point of view, I decided to purchase campaign management software, software that should make our jobs easier. Because each of you are so overworked right now, I am hiring consultants to help us identify ways to best use the software. It is my sincere desire to have the consultants work with us in March, to install the software in April, begin using the software in May, and have a more manageable workload in June. If this transition goes well, I expect there to be enough surplus time for some of you to begin tackling strategic projects early this summer. I'm glad you spoke up and asked for a change. What questions do you have that I might be able to answer for you?
If you listen closely to each statement as the statement is read, you are likely to develop a mental picture of what you think is happening.
The first statement is relatively vague. As a result, the employee will fill in the blanks for herself. If her questions are not answered by what is said, she is likely to make assumptions about the pieces of information that are missing.
The second statement, while not perfect, paints a picture that is different. There is more information. There is less room for the employee to feel doubt.
If there is anything I have learned over the past six-plus years, it is the importance of telling as much as you can to your employees about what is happening, why it is happening, and how the employee benefits (or avoids trouble) by following the direction of the executive. Communication must be followed up with actions consistent with the communication.
Failure to communicate leads to uncertainty, doubt, gossip, and even bad feelings. Failure to act in a manner consistent with your communication destroys trust. Failure to do both is simply not a fair way to treat your employees.
Are there examples of individuals you have worked with, individuals who are great communicators? What lessons did you learn from the communication style of these leaders, or co-workers?
February 06, 2007
Toward the end of the survey, the person asking questions queried me regarding what the first thing is that I would purchase if I had an additional $100,000.
I told her, "A Highly Talented Analyst". Her response to my proclamation was "That's what every respondent says."
Somewhere between the strategy our leaders ask us to implement, and all the tactics we employ to drive sales and profit, we have a gaping pothole on the multichannel marketing turnpike that needs to be filled with an immediate infusion of talent.
We give Google responsibility for driving fifteen percent of our online business. In the process, we give all the intelligence of knowing why our business works to Google. We hire internal staff and vendors to be subject matter experts at manipulating Google.
Half of UK businesses fail to adequately measure the performance of their e-mail campaigns.
Maybe it's ok that we don't measure the ROI of e-mail campaigns, given that the performance of e-mail continues to free fall. As mentioned yesterday, we celebrate a medium where we sell something to one customer in five hundred. My father sold vacuum cleaners door-to-door in the 1960s. Do you think he would have celebrated one sale in five hundred visits?
In the past ten years, I observed at least three trends that resulted in a dearth of talent.
- Demographics: There are far fewer thirty to forty year old employees than there were ten years ago, as Gen-X moves into their prime earning years.
- Algorithms: We learned how to manage computers, or we learned how to manage businesses that managed technology. We spent less time understanding why our businesses worked. We spent more time managing the technology that made our businesses work. Now, we're a slave to technology. We need to be slaves to understanding why customers purchase from our businesses.
- Strategy vs. Tactics: The time we spend on tactics, especially those tactics that allow us to manage algorithms, takes away from the time we need to spend developing strategies. Take an honest look at the company you work for. Can you identify the three strategies your company is working on in 2007 --- and do you know which tactics you can use to make your strategy happen?
We need to spend time developing humans (not algorithms), teaching the skills humans need to be effective in a world dominated by real-time algorithms.
Where you can, spend more money developing your employees, and spend less money outsourcing your key functions to vendors. Obviously, there is a balance to be achieved in outsourcing key functions. Where possible, invest in your own people.
Use today to develop tomorrow's leaders.
January 28, 2007
Within a year, we had individuals focusing on internet marketing. If I remember correctly, we called the channel 'I-Media'.
Our Vice President of Marketing would kid our 'I-Media' person. "How many orders did we get yesterday, six or seven?" he would joke. The 'I-Media' person would just plug along, doing work that none of us really understood.
Six or seven orders a day became an annual total of $65,000,000 three years later. Vice Presidents paid attention to that number. These sales appeared to be largely 'free'. We didn't have to spend $10,000,000 marketing to the customer to get these sales ... at least on the surface, it didn't appear that way.
In 1999, I was Director of Circulation for a $500,000,000 catalog business that was stumbling along. Sales were no longer increasing, in fact, catalog demand was decreasing year-over-year, on a comp basis. But we had $65,000,000 of 'I-Media' demand. What's not to love about that? The P&L looked great. We earned nice bonuses.
By late 1999, the 'I-Media' channel was garnering attention at Eddie Bauer. The E-Mail and 'I-Media' folks were moved to another building, to focus on growing sales in the online channel. The rest of us were sequestered in our building, trying to figure out why we couldn't grow sales in the catalog channel anymore, in spite of the fact that 'customers buying from multiple channels are the best customers'. If those customers are the best customers, why do they keep spending less and less in catalog? Today, we know why. Back then, it was a bit of a mystery.
I don't know if these trends happened at other companies. What I do know is that, in many cases, the internet marketers and e-mail marketers developed their analytical tools, marketing strategies, and a network of co-workers/friends outside of the regular processes within our businesses.
While the rest of us tried to maintain a robust profit and loss statement by cutting costs, circulation and pages --- by shifting management of customer acquisition to businesses like Abacus, the online marketing folks were frequently off in their own world, building relationships with CheetahMail, Google, AOL, Yahoo! and MSN. They literally built their own businesses, independent of the core business.
Over the past five years, there has been an enormous focus on integrating the internet channel into the rest of the business, across all of our multichannel businesses. Our failure to integrate the business sooner caused us to spend too much time developing skills in our specific niche. We didn't build enough skills across functions or channels. Couple this fact with an ever-decreasing number of 30-40 year olds in our businesses, and we're now heading for talent trouble.
The only folks who tried, in some way, to integrate business units were merchandisers. Customers liked buying merchandise online, in catalogs, or in stores. The merchandising folks, keenly aware of the importance of growing sales, probably did the best job of understanding how merchandise sold across channels. They didn't understand how the channels worked together, but they did get to see how merchandise sold across channels.
The rest of us were busy tackling unique issues that caused us to not have the skills necessary to lead a business in the year 2007.
Catalog folks focused their energies on a dying business model, trying every technique possible to improve efficiency and profitability, becoming more and more like a fossil in the process.
Retail folks feared that the online channel would cannibalize their sales, and viewed the internet as an enemy, never understanding that so many of their customers were researching merchandise online before coming into the store.
Online marketing folks, never knowing the pain of having the distraction of managing a downturn in business, integrated their businesses with Google, to a point where they depend on the search channel for between ten and forty percent of their sales. More on that in a future post.
Like everything else in the first decade of the 21st century, we fragmented ourselves into targeted niches. Not enough of us built General Management skills to manage a fragmented, multichannel business, in the year 2007.
The result is an utter lack of General Management talent in the multichannel retailing industry. There simply aren't enough people who know the entire business. There are plenty of people who know one specific aspect of the business.
A decade of focusing on keywords yielded thousands of talented individuals who know exactly how to work with Google. These folks have not been given the experiences to manage anything outside of a relationship with Google.
A decade of writing copy that is search friendly yielded thousands of talented individuals who know exactly how to write copy that is appealing to Google. These folks were never given an opportunity to write copy that romanced a customer.
A decade of writing catalog copy that romances the customer yielded thousands of talented individuals who know nothing about writing copy that is appealing to Google. These folks were cut off from the future of the business, and failed to acquire necessary skills for the future, through no fault of their own.
A decade of reducing catalog expenses yielded thousands of talented individuals who know how to communicate to Abacus what type of model they want built for catalog customer acquisition. These folks don't have the tools necessary to understand what type of customer they are acquiring with their catalog mailings. They are giving up management skills, in exchange for the skillset of working with Abacus.
A decade of managing open rates, click through rates, and conversion rates yielded thousands of talented individuals who know how to send an e-mail that converts a customer to a sale today. These folks were never given an opportunity to build something that lasts, something that customers save --- as evidenced by the fact that 75% of people don't even bother to open a marketing e-mail.
Because merchandisers had to sell product across all channels, we now focus our leadership opportunities on these folks. Leadership jobs in the multichannel industry are likely to go to merchandisers over the next five years.
Our businesses must do a better job of cross-training our highly talented online marketing individuals, so that they can assume leadership positions in our multichannel organizations.
If we don't do this, we simply yield more control of our business to algorithms, Darwinian-style evolution of merchandising strategy, Abacus, and Google. At some point, we must grow our talented online marketers, giving them broad cross-functional opportunities to become leaders. If we don't do this, we're subject to a world where merchandisers tell us to tell Abacus and Google what to do. We won't be left with a meaty, meaningful job.
Multichannel marketing is moving ever-closer to an algorithm-driven business that lacks warmth, humanity, and gut instinct. We need to begin adapting to this trend now, and need to begin developing marketing leaders capable of doing more than working with Google and Abacus.
January 18, 2007
The 1/3, 1/3, 1/3 Rule: You'll find that your co-workers fall into three camps. About a third will support you through anything. About a third could take or leave you. Another third are generally against you. Your job is to do outstanding work, with integrity, so that the middle third sides with you, silencing the last third.
Save Your Pennies: For most, the ride eventually ends. So save your pennies.
Don't Listen To Them: Even if you do a good job, that silent third will tell you all the reasons why your ideas are bad. If you're doing an average job, or you are threatening the status quo, the remaining third becomes vocal --- very vocal. Don't listen to them. They will criticize anything you do.
Everybody Is Fighting A Great Battle: You can see this in the eyes of your employees. Somebody had a child who spent the entire evening throwing up. Another employee's mother just passed away. Yet another employee spilled a latte on his slacks. Everybody has problems that superceed work. To them, these problems are epic, mighty battles. Recognize this, and manage to it.
At Some Point, You Have To Choose Between People And Money: This is probably the biggest decision you'll have to make. Somewhere along your journey, you will be asked to drag your staff through mud in order for the business to make more money. If you want to go to Heaven, choose your staff. If you want to be a superstar, side with Money. If you figure out how to effectively deal with this tension, please let me know how to do it!
If You Are Working More Than Fifty Hours A Week, You Are Failing: Contrary to popular belief, the burned-out executive lifestyle is not all it is cracked-up to be. If you are working longer than 7-5 or 8-6 or 9-7, you are failing. Either your staff is not ready to take on more work, or you have failed to hire the right number of people to do the work, or you have failed to effectively say "NO" to projects. Every hour over fifty is one hour you will never get back with your spouse, children and hobbies.
Bad Behavior Is Your Fault: You need to set expectations in the first few days of your new assignment. The longer you let certain behaviors fester, the harder it gets to change them.
Honesty > Politics: You can make a choice to be honest with your folks, or you can be political and choose not to share non-confidential issues with them. Side with honesty. If you aren't honest and trustworthy, your folks will paint their own canvass. That leads to gossip. Gossip kills productivity, and gossip kills relationships between employees.
If You Did A Great Job In A Forest, And Nobody Saw You Do It, Did The Great Job Really Happen? At some point, you have to figure out, within your culture, how to effectively market you and your team. In many cases, the marketing of you and your team is more important than the outcome of the work you actually do.
Support Your Boss, Or Leave The Company: Some of my biggest mistakes happened when I did not support my boss. If something unethical is happening, tell somebody, and then consider leaving. If you have a difference of opinion, make the choice to support your boss and move on, or leave. Arguing gets you nowhere.
Know The Profit And Loss Statement Inside Out: Those who know the p&l know how to cost-justify projects and initiatives. Not surprisingly , these folks get things done.
If You Want To Be Appreciated, Lead When Sales Are Increasing: Ever notice how quick folks are to hire those who have worked at successful companies? You can do outstanding work at a failing company. But if your goal is to be an upwardly mobile executive, align yourself with the updraft. A whole generation of online marketers and search experts are doing this as we speak. You don't hear a lot of "He did a spectacular job of keeping CD sales flat at Tower Records", do you?
Do Not Fall In Love Your Company: The blogosphere is filled with marketing experts promoting the myriad benefits of 'brands', with an adoration seldom paralleled in society. We focus a disproportionate amount of energy on the magical power of Apple, or Nike, or Starbucks, thinking any company or any idea can result in the success Apple, Nike or Starbucks experienced. Build the brand!!! We offer advice for every brand (improve your customer service, clean up your stores, give me a free phone, listen to your customers, do these things and we'll love you). When is the last time a 'brand' loved a person? When is the last time a company was there for a person when something awful happened to the person? Leaders can be there for people. Co-workers are usually there for people. The Human Resources department is there for people. Brands are never there for people. The purpose of a brand is to facilitate the transfer of wealth from customers to shareholders. When this transfer of money is not happening as efficiently as it should happen, your job is in jeopardy. The 'brand' will chew you up and spit you out in a heartbeat if the 'brand' thinks you are in some way impeding the re-distribution of wealth. Fall in love with your company, and your feelings will inevitably be hurt when your brand turns on you.
Celebrate The Victories: There are untold victories in everyday work life. Appreciate and recognize people for making these things happen. I can certainly improve my skills on this one.
Give Credit: Your people are responsible for everything that happens. You may think your vision is legendary, even bordering on brilliant. Your vision doesn't happen without your people --- people who put aside their dreams to make your dreams come true.
Please add to this list, offer your contributions based on what you've learned.