Distinct or … Extinct Tom Peters Seminar2000 Corning Quality Milestone 2000 29 June 2000

Distinct or … ExtinctTom Peters Seminar2000

CorningQuality Milestone 2000

29 June 2000

Pentium III 800MHz: $42,893.00/#Hermes Scarf: $1,964.29

Saving Private Ryan on DVD: $874.75Mercedes-Benz: $18.98Hot-rolled steel: $0.19

Source: Fortune (3.20.00)

An Age of Passion:1 Year = 1.5 Wal*Marts

03.27.99: $167B03.27.00: $555B

P.S.: Wal*Mart = #8 in 2000

Part I: Brand InsidePart II: Brand Outside

Part III: Brand Leadership

Forces @ Work I

The Destruction Imperative!

Forget > Learn

“The problem is never how to get new, innovative thoughts into your mind, but how to get old ones out.”

Dee Hock

Headlines 06.15.00: Your Call!

Bell Atlantic-GTE

vs.

Lucent

“Acquisitions are about buying market share. Our challenge is to create markets. There is a big difference.”

Peter Job, CEO, Reuters

“Our ideal acquisition is a small startup that has a great technology product on the drawing board that is going to come out in six to twelve months.

We buy the engineers and the next generation product. …”

John Chambers, Cisco

Pentium III 800MHz: $42,893.00/#

Cisco Engineer: $19,000.00Hermes Scarf: $1,964.29

Saving Private Ryan on DVD: $874.75Mercedes-Benz: $18.98Hot-rolled steel: $0.19

Source: Fortune (3.20.00)

Expected “Batting Average”?

Intel’s venture fund: 275 investments, $8B

Source: Fast Company , eCompany

C.E.O. to

C.D.O.

The Gales of Creative Destruction

+29M = -44M + 73M

+4M = +4M - 0M

Brand Inside

Brand Org: Lean, Linked,

Electronic & Malleable

108 X 5vs.

8 X 1*

* 540 vs. 8

And Now the Equivalent …

White Collar Revolution!

The Pincer 5

“Destructive” entrepreneurs/ Global Competition

“White Collar Robots”

THE INTERNET! [E.g.: GM + Ford + DaimlerChrysler]

Global Outsourcing [E.g.: India, Mexico]

Speed!!

RR on “Assetless” [J.B.] Sara Lee

“The most profitable businesses in the future will act as knowledge brokers, linking insights into what’s available

with insights into the customer’s individual needs

and preferences.”

The “&-!!+#$% in the middle”*

Jim Clark on Healtheon/WebMD

* ’twixt docs, patients, insurers and providers; $275B of $400B in waste; source: Michael

Lewis, The New New Thing

[ Incidentally …

CEO Jeff ArnoldAge: 30

First Start-up: Age 24]

“This is the Age of Ageism: The real innovator’s dilemma isn’t ‘disruptive technologies;’ it’s

the relentless rise of the quasi-adolescents who wield them.”

Michael Schrage

“A good plant engineer in a paper mill may create $100K to $300K in value per year. An

outstanding software product developer may create a product worth $1M to $300M. Talented people are less likely to wait their turn. We

used to view young people as trainees; now they are authorities. Arguably this is the first time the older generation can –

and must – leverage the younger generation very early in their careers”

Ed Michaels, War for Talent (05.17.00)

“We want to be the air traffic controllers

of electrons.”Bob Nardelli,

GE Power Systems

So does Enron![et al.]

Brand Inside

Brand Work!

So what will be the Basic Building

Block of the New Org?

New OrleansApril 2000:

Jazz Festival + NAPM

Welcome to the Y2K New Orleans Jazz

and Real Cool Purchasing Dudes

Festival!

You are the Rock Stars

of the B2B Age!

ChicagoNovember 1999:

SHRM

“support function” / “cost center” / “bureaucratic

drag”

or …

“Rock Stars of the ‘Age of Talent’ ”

Enter …

The WOW Project!*

*The Project50

“Reward excellent failures. Punish

mediocre successes.”

Phil Daniels, Sydney exec

But Does It Matter ????

“On time, on budget … who cares?”

anon. seminar participant (4/99)

“You really got to me. So many of our information technology projects take on a life of their own, and I know they’ll never end up as more than ‘mediocre successes.’ ”

CEO, F100 financial services company (10-98)

The greatest dangerfor most of us

is not that our aim istoo high

and we miss it,but that it is

too lowand we reach it.

Michelangelo

Brand Inside

Brand You: Distinct …

or Extinct

DISTINCT … OR EXTINCT!

“If there is nothing very special about your work, no matter how hard you apply yourself, you won’t get noticed and that increasingly means you won’t get paid much, either.”

Michael Goldhaber, Wired

Brand Inside

Brand Talent: The Great War for Talent

Issue Y2K

The Great War for Talent!

“When land was the scarce resource, nations battled

over it. The same is happening now for talented people.”

Stan Davis & Christopher Meyer, futureWEALTH

“The market’s being divided up right now. We’re in a

tough competition [with the U.S. and the U.K.] for

the best brains.”Gerhard Schroeder, on Germany’s new

tech immigration policy[Frankfurter Allgemeine/06.02.00]

Winner Take All!

From “1, 2 or 3” [JW] to “Best talent in each industry segment

to build better models and proprietary

intangibles” [EM]Ed Michaels, War for Talent (05.17.00)

Home Depot Goes Long!

7 new growth initiatives ($20B to $100B in 5-7 years)

Arthur Blank: BEST PERSON IN THE WORLD TO HEAD EACH

INITIATIVE

E.g.: COO of IKEA to head international expansion

Ed Michaels, War for Talent (05.17.00)

There is no “talent shortage” …

if …

you are a GPTW*

*Great Place To Work

“The leaders of Great Groups love talent and know where to find it. They revel in the talent of others.” Warren Bennis & Patricia Ward Biederman

“The Silent Battlefield”

50% of middle mgrs. in big corps. report “moderate to high” chance they’ll change

companies within 3 years

More loyalty to geography than companies

Most companies: don’t know how many 25-40 year olds they’re losing, have no special

retention programs

Ed Michaels, War for Talent (05.17.00)

“Top performing companies are two to four times more likely than the rest to pay what it

takes to prevent losing top performers.”

Ed Michaels, War for Talent (05.17.00)

Dudes With ’Tude“Our business needs a massive transfusion of talent. And talent, I believe, is most likely to be found

among non-conformists, dissenters and rebels.” David Ogilvy

“He grew his hair long, played guitar in a rock band, chased

girls, got into trouble. At age 17 he was flogged by his house

master, who described him as ‘the most difficult boy I’ve ever

had to deal with.’ ”

Solution?

Slip Ritalin into his food …

Or …

Elect Him Prime Minister

Tony Blair*

*talk/May 2000

Talent War Y2K!

–All out!/ Time consuming!–Never ending!/ Unwinnable!–Includes everybody!/ Everybody’s

game! (“We’re all in sales.”)–Expensive!–Cool!/ WOW!/ Fun!/ Creative!–Strategic!/ Core competence!

Talent = Brand

Part I: Brand InsidePart II: Brand Outside

Part III: Brand Leadership

Forces @ Work II

The Commodity Trap

Quality Not Enough!

“Quality as defined by few defects is becoming the

price of entry for automotive marketers

rather than a competitive advantage.”

J.D. Power

“We make over three new product announcements a

day. Can you remember them?

Our customers can’t!”Carly Fiorina

“The ‘surplus society’ has a surplus of similar companies, employing similar

people, with similar educational backgrounds, coming up with similar ideas, producing similar things, with similar prices and similar quality.”

Kjell Nordstrom and Jonas Ridderstrale, Funky Business

“Customer Satisfaction” to “Customer Success”

“We’re getting better at [Six Sigma] every day. But we really

need to think about the customer’s profitability. Are customers’

bottom lines really benefiting from what we provide them?”

Bob Nardelli, GE Power Systems

GE’s New Six Sigma Approach

Old view: Out of service 9 days. 4 days are transport, which is client

responsibility.

New view: ALL 9 DAYS ARE OUR RESPONSIBILITY! Why? 9 days =

Client’s World.Source: Steve Kerr, VP, GE

Brand Outside

Strategy 1:

Lead the Customer!

“These days, you can’t succeed as a company if you’re consumer led –

because in a world so full of so much constant change, consumers can’t

anticipate the next big thing.

Companies should be idea-led and consumer-

informed.”Doug Atkin, partner,Merkley Newman Harty

“Wealth in this new regime flows directly from innovation, not

optimization. That is, wealth is not gained by perfecting the known,

but by imperfectly seizing the unknown.”

Kevin Kelly, New Rules for the New Economy

Brand Outside

Strategy 2:

Use E-Commerce

to Re-invent the Business!

Tomorrow Today: Cisco!

90% of $14.4B(Cisco Connection ONLINE)

Save $500M(service and tech support)

C.Sat e >> C.Sat HCustomer Engineer

Chat Rooms/Collaborative Design ($1B “free” consulting)

And Larry?

Service Call Center

$300.00 per transaction to $1.50

Savings: $550,000,000.00

Source: Ralph Seferian, Oracle [part of O’s $1B saving – on a rev. base of $9B; $1B addnl this year]

GM/Ford/DaimlerChrysler (02-27)

Covisint$240B (+$500B)

I.P.O.

Goal?

Drive profits to zero!*

*Remember AMR and “dynamic pricing.”

No Room for “Competent”* Sorts

Beer WholesalersPersonal Trainers [FitLinxx]

Financial PlannersCar Dealers

* LVA, “M”VA … vs. HVA [Web-enhanced]

Defense-Offense: Systems Integration/HVA

United TechnologiesGE

Delphi

E.g. …

GE: boxes [transformers, etc.] to “air traffic controllers of electrons”

UTC/Otis + Carrier: boxes to “integrated building systems-

solutions”; P&W, etc.: boxes to major aircraft subsystems

“Where does the Internet rank in priority?

It’s No. 1, 2, 3, and 4.” Jack Welch

Brand Outside

Strategy 3:

It’s the Experience!

“Experiences are as distinct from services as services are from

goods.”Joseph Pine & James Gilmore, The

Experience Economy: Work Is Theater & Every Business a Stage

“The [Starbucks] Fix” Is on …

“We have identified a ‘third place.’ And I really believe that sets us apart. The third place is

that place that’s not work or home. It’s the place our

customers come for refuge.”Nancy Orsolini, District Manager

Experience: “Rebel Lifestyle!”

“What we sell is the ability for a 43-year-old accountant to dress in black leather, ride

through small towns and have people be afraid of him.”Harley exec, quoted in Results-based

Leadership

“Car designers need to create a story. Every car provides an

opportunity to create an adventure. …“The Prowler makes you smile. Why? Because it’s focused. It has a plot, a

reason for being, a passion.”

Freeman Thomas, co-designer VW Beetle; designer Audi TT

Hmmmm(?): “Only” Words …

StoryAdventure

Smile Focus

PlotPassion

“This is the end of the pure product era. For instance, car

makers are beginning to understand that the car is a

platform for delivering services that drive the customer

experience.”Carly Fiorina, HP @ Comdex ’99

Brand Outside

BRAND POWER!

Brand It! Now, More Than Ever!

“The increasing difficulty in differentiating between products and

the speed with which competitors take

up innovations will assist in the rise and rise of the brand.”

Gillian Law and Nick Grant, Management [New Zealand]

“Create a Cause, not a ‘business.’ ”

Gary Hamel, Fortune (06.00), on re-inventing a company (Exemplar #1:

Charles Schwab)

Part I: Brand InsidePart II: Brand Outside

Part III: Brand Leadership

Brand Leadership

Passion Rules!

Brand Leadership!

“A key – perhaps the key – to leadership is the effective

communication of a story.”

Howard Gardner Leading Minds: An Anatomy of Leadership

“The challenge for IBM, AT&T and other mainstream companies is to re-instill a sense of adventure in

recruits.”

Burke Stinson, AT&T

Brand Leadership:ENTHUSIASM RULES!

“I am a dispenser of enthusiasm.”/ Ben

Zander

“If things seem under control, you’re just

not going fast enough.”

Mario Andretti

Main Messages …

War for Talent![pay, early responsibility, recruit rebels]

Value Added Through Systems Integration [commodity “boxes” to “air

traffic controllers for electrons”]

Run All on the Internet [Oracle model]

Brand Power! [for a “Tech Company”]