Distinct or … Extinct Tom Peters Teleconference2000 Arlington Texas 16 August 2000

Distinct or … Extinct

Tom Peters

Teleconference2000

Arlington Texas16 August 2000

Defeated Before The Starter’s Gun!

“Track 4: Managing Organization Change (Helping

Tired and Overworked Professionals with Today’s

Workplace Realities)”

NAPM: “You are the

Rock Stars of the

B2B Age!”

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

No Wiggle Room!

“Incrementalism is innovation’s worst enemy.”

Nicholas Negroponte

Just Say No …

“I don’t intend to be known as the ‘King of

the Tinkerers.’ ”CEO, large financial services company

(New York, 5-99)

“There’s going to be a fundamental change in the

global economy unlike anything we have had since

the cavemen began bartering.”

Arnold Baker, Chief Economist, Sandia National Laboratories

“There is probably going to be more confusion in

the business world in the next decade than there has been in any decade

in history.”Steve Case (2-00)

NOW THAT’S B-I-G!

“The period 2000-2002 will bring the single greatest change in

worldwide economic and business conditions since we came down from the trees.”

David Schneider & Grady Means, MetaCapitalism

“The corporation as we know it, which is now 120 years old, is

not likely to survive the next 25 years. Legally and financially,

yes, but not structurally and economically.”

Peter Drucker, Business 2.0 (08.00)

“We are in a

brawl with no rules.”

Paul Allaire

S.A.V.

John Roth’s Dogma [Nortel]

1. Our strategies must be tied to leading-edge customers on the attack.

2. Time cannot be sacrificed for better quality, lower cost, or even better decisions.

3. It doesn’t matter whether you develop or acquire leading technology. Our job is to provide the technology

and products our customers need.4. Success is achieved by leading change,

not waiting for it.5. We are paranoid about our leadership – willing to cannibalize our own products to maintain our edge.

Source: Abridged from The Wall Street Journal (07.25.00)

“It used to be that the big

ate the small. Now the fast eat the slow.”Geoff Yang, IVP/ (Institutional

Venture Partners)

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

“When asked to name just one big merger that had lived up to

expectations, Leon Cooperman, former cochairman of Goldman

Sachs’ Investment Policy Committee, answered: ‘I’m sure there are

success stories out there, but at this moment I draw a blank.’ ”

Mark Sirower, The Synergy Trap

“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)

C.E.O. to

C.D.O.

The [New] Ge Way

DYB.com

The Gales of Creative Destruction

+29M = -44M + 73M

+4M = +4M - 0M

Paradox Redux

Atlanta: +113,600 = #1 metro area

Layoffs [major]: BellSouth, Lockheed, Coca-Cola

Brand Inside

Brand Org: Lean, Linked,

Electronic & Malleable

108 X 5vs.

8 X 1*

* 540 vs. 8

Headline: “Bank of America to Cut … 10,000 Jobs”

“Middle-level and senior managers are expected to be

the principal targets of the job cutbacks.”

Source: The New York Times (07.29.2000)

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!!

“A bureaucrat is an expensive

microchip.”Dan Sullivan, consultant and

executive coach

Cadence Network = Whatever

“Business process outsourcer”

Electric, gas, telecom, waste disposal “stuff”

E.g.: Winn Dixie, Blockbuster, Limited, Papa John’s

Source: Forbes.com [07.00]

“Assetless Company”

J.B.

[“Don’t own nothin’ if you can help it. If you can, rent your shoes.”

F.G.]

Cisco, Dell =

Brand-owning companies who sell Customer

Satisfaction

Source: David Schneider & Grady Means, MetaCapitalism

“More and more companies these days want to be like Cisco. They

want to focus on their core business and outsource all the superfluous stuff, like human resources, procurement and

accounting.”

Forbes.com, 07.17.00, on ASPs

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.”

Brand Inside

Brand Work: The Professional Service

Firm Model & The WOW Project

So what will be the Basic Building

Block of the New Org?

Why are there no books on how to create

a “Cool, Rocking, WOW-producing

Finance Department”?

New OrleansApril 2000:

Jazz Festival + NAPM

You are the … Rock Stars

of the B2B Age!

Welcome to the Y2K New Orleans Jazz

and Real Cool Purchasing Dudes

Festival!

Message: You are Re-invention Evangelists!

ChicagoNovember 1999:

HRMAC

Message: You are Rock Stars of the “Age of Talent”

Every job done in W.C.W. is also done

“outside” … for profit!

Credo

“WORK WORTH

PAYING FOR”

PSF 1.0

Department Head

to …

Managing Partner, HR [IS, etc.] Inc.

C.I.O. to

C.E.F.R.N.S.*

*Chief Evangelist For

Really Neat Stuff

Enter …

The WOW Project!*

*The Project50

“Reward excellent failures. Punish

mediocre successes.”

Phil Daniels, Sydney exec

“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)

Measures

–WOW!–Beauty!–Raving Fans!–Impact!

“Every project we take on starts with a question:

How can we do what’s never been done

before?”Stuart Hornery, CEO, Lend Lease

SOOOO … HOW MANY OF YOUR COLLEAGUES ARE

“BACK HOME” AT WORK ON NO-BALONEY …

WOW* PROJECTS!

* WOW = Will be remembered fondly/

bragged about 5+ years from now

G: How’d that herringbone pattern for the hearth come out?

T: Great! But the tile guy’d like to get his hands on you; it was a royal pain.G: But it looks good, right?

T: Fabulous.G: That’s what matters. I tell my guys, “It may be a lot of work, but think about it this way:

Would you bring your kid back, 10 years from now, to see the job?”

Characteristics of the “Also Rans”

“minimize risk” “respect the chain of command” “support the boss” “make budget”

Source: Fortune on “most admired global corporations” (10/26/98)

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

Minimum New Work SurvivalSkillsKit2000

MasteryRolodex Obsession

Finishing SkillsEntrepreneurial Instinct

Mistress of ImprovSense of Humor

Intense Appetite for TechnologyGroveling Before the Young

Embracing “Marketing”Passion for Renewal

T.T.D.sThe next slide is the first of several

“T.T.D.” activities. I.e.: Things To Do, shorthand versions of training

exercises I use. Also: These T.T.D. (black-background)

slides and the section titled Boss-Free Implementation have

accompanying Notes.(Use normal view to access.)

Tom Peters

T.T.D./Assignment

Construct a 1/8-page or 1/4-page ad for

Brand You … for the Yellow Pages

“You are the storyteller of your own life, and you

can create your own legend or not.”

Isabel Allende

R.D.A.

Rate: 15%?, 25%?

Therefore: Formal “Investment

Strategy”/R.I.P.

T.T.D./Your R.I.P.

IS IT … FORMAL? IS IT ... WOW!?

“You must realize that how you invest your human capital matters as much as how you

invest your financial capital. Its rate of return determines your future options. Take a job for what it teaches you, not for what it pays. Instead of a potential employer asking, ‘Where do you see yourself in 5 years?’

you’ll ask, ‘If I invest my mental assets with you for 5 years, how much will they

appreciate? How much will my portfolio of career options grow?’ ”

Stan Davis & Christopher Meyer, futureWEALTH

Seminar Y2K/Brand Inside

Message: Distinct … or

Extinct!

THE I work for a company called

Me STREET JOURNAL

Adventures in Capitalism

THE rise up and flee your cubicle STREET JOURNAL

Adventures in Capitalism

New World, New Words, New Images

www.guru.com: Power for the Independent Professional [Links

indep. professionals and projects] [“Official uniform of Guru Nation”: the bathrobe!]

www.freeagent.com: A Brave New Workforce

Bill Parcells’ World/ Brand You World!

BLAME NOBODY!EXPECT NOTHING!DO SOMETHING!

NY Post (9/99)

Brand Inside

Brand Talent: 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

Winner Take All!

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

industry segment to build best proprietary intangibles” [EM]

Source: 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)

“We believe companies can increase their market cap 50 percent in 3 years.

Steve MacAdam at Georgia Pacific changed 20 of his 40 box plant managers to put more talented, higher paid managers in charge. He increased profitability from $25 million to $80 million in 2 years.”


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

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

takes to prevent losing top performers.”


“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

“The Triumph of the Brainiac: In today’s biotech,

dot-com world, nerds rule, and it all starts in

high school”

Cover story, The New York Times Magazine (06.04.00)

“Where do good new ideas come from? ...

That’s simple! From differences. Creativity comes from unlikely juxtapositions. The best way to

maximize differences is to mix ages, cultures and disciplines.”

Nicholas Negroponte

“Diversity defines the health and wealth of nations in a new century. Mighty is the

mongrel. … The hybrid is hip. The impure, the mélange, the adulterated, the blemished, the

rough, the black-and-blue, the mix-and-match – these people are inheriting the earth. Mixing is the new norm. Mixing trumps

isolation. It spawns creativity, nourishes the human spirit, spurs economic growth

and empowers nations.”

G. Pascal Zachary, The Global Me: New Cosmopolitans and the Competitive Edge

“Capitalism and the conditions for creating wealth have changed in ways that play to the strengths of hybrid

individuals, organizations and nations. And those that wish to profit from changing economic conditions must view hybridity as their first and best option. This bold

claim warrants an explanation. The ability to apply knowledge to new situations is the most valued

currency in today’s economy. Highly creative people … are misfits on some level. They tend to question

accepted views and consider contradictory ones. This appreciation defines the mongrel mentality. Strangers

instinctively question things that natives take for granted. Many things strike them as odd or stupid. …”

G. Pascal Zachary, The Global Me

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

Axiom: Never hire anyone without an aberration in their

background. (Find the One Ton Cookie Man!)

“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

Yes!

Director of Bringing in the Really Cool People

All You Need to Know?

Chief Evangelist For Really Neat Stuff

Director Of Bringing In The Really Cool People

T.T.D.

STEAL THESE TWO JOB TITLES!

Talent = Brand

Women and new-economy

management …

The New Economy …

Shout goodbye to “command and control”!

Shout goodbye to hierarchy!

Shout goodbye to “knowing one’s place”!

Women’s Stuff = New Economy Match

Improv skillsRelationship-centric

Less “rank consciousness”Self determinedTrust sensitive

IntuitiveNatural “empowerment freaks” [less

threatened by strong people]Intrinsic [motivation] > Extrinsic

“TAKE THIS QUICK QUIZ: Who manages more things at once? Who puts more effort into their appearance? Who usually takes care of the details? Who finds it

easier to meet new people? Who asks more questions in a conversation? Who is a better

listener? Who has more interest in communication skills? Who is more inclined to get involved?

Who encourages harmony and agreement? Who has better intuition? Who works with a longer ‘to do’ list? Who enjoys a recap to the day’s events? Who is

better at keeping in touch with others?”

Source: Selling Is a Woman’s Game: 15 Powerful Reasons Why Women Can Outsell Men, Nicki Joy &

Susan Kane-Benson

It’s Girls, Stupid!

1996: 8.4M women, 6.7M men in college (est: 9.2 to 6.9 in 2007); more women than men in

high-level math and science courses

More girls in student govt., honor societies; girls read more books, outperform boys in artistic and musical ability, study abroad in

higher numbers

Boys do rule: crime, alcohol, drugs, failure to do homework (4:1)

Source: The Atlantic Monthly (May2000)

“Boys are trained in a way that will make

them irrelevant.”

Phil Slater

Brand Outside=

Brand Inside

Reprise: Brand Inside

The White Collar Revolution & The Web [90% poleaxed, CDO, Healtheon/WebMD, Buzzsaw.com]

PSF as Building Block [Work Worth Paying For, Real Cool Purchasing Dudes]

Work Worth Paying For = WOW Projects!

Brand You [Everybody!]

The Great War for Talent! [Lookin’ for Dudes with ’tude]

Brand Inside

Brand Action:Getting Started … a

Personal Perspective

Topic: Boss-free

Implementation of STM /Stuff That

MATTERS!

I. THE IDEA

“4Fs”: Find a

Fellow Freak

Faraway

World’s Biggest Waste …

Selling “Up”

Heart of the Matter

K2K!*

*Kook to Kook

“Lead” customers!

K2K redux!

And for the 6-Person Group??

Send one “Cool Dude/Dudette” out

to Find Something Cool, work with a Cool Customer, etc. [The “Micro-Skunkworks Strategy”]

II. THE NUGGET

Do Something. Do Anything.

Get Going.Now.

Opportunity ALWAYS Knocks

VFCJ* “Strategy”

*Volunteer For Crappy Jobs

Is It …

“The Oh-Shit-I-Wish-It-Were-Over Memorial Day picnic”

or

“The First Annual Seriously

Kewl Celebration of Our Incredible Staff”

Is It …

Wrestle the damn Safety Manual into line with the ridiculous new OSHA Regs?

Or …

A stealth opportunity to address the War for Talent via … a thoroughgoing review

of how safety and environmental issues contribute to making this a

GPTW/Great Place To Work?

Is It …

Fix these bloody customer problems that have cropped up with the new 2783B?

Or …

A chance to work with a hotshot, young division GM on …

using the Internet/Internet Speed to revisit the entire process of how we get customer input – before and during the fact – into the

heart of the Product Creation Process?

Reframers’ Rules:

Rule 1: Never accept an assignment as given! (Please.)

Rule 2: You’re never so powerful as when you are “powerless”!

Rule 3: Every “small” project contains the entire

enterprise DNA!

Bottom Line …

ANYTHING CAN BE THE RAW

MEAT FOR YOUR CRUSADE!

III. THE TOOL

Prototyping Mania!

Culture of Prototyping

“Effective prototyping may be

the most valuable core competence an innovative organization can

hope to have.”

Michael Schrage

Think about It!?

Innovation = Reaction to the Prototype

Michael Schrage

“You can’t be a serious innovator unless and until you are ready,

willing and able to seriously play. ‘Serious play’ is not an oxymoron;

it is the essence of innovation.”

Michael Schrage, Serious Play

Secret:

Creating the …

Rhythm of Prototyping

IV. THE SOFT STUFF 1

Show Up!Connect!

Message: It’s Community

Organizing, stupid!

See: Saul Alinsky’s Rules for Radicals

Are You a …

Viral Enthusiast?

P.S. …

Mark McCormack: 5,000 miles for a 5

min. meeting.

“It was much later that I realized Dad’s secret. He gained respect by giving it. He

talked and listened to the fourth-grade kids in Spring Valley who shined shoes the same way he talked and listened to a

bishop or a college president. He was seriously interested in who you were and what you had to say.”

Sara Lawrence-Lightfoot, Respect

Epitaph from Hell … Epitaph from Hell …

Joe T. Jones Joe T. Jones

1942 - 20001942 - 2000

HE WOULDA DONE SOME HE WOULDA DONE SOME

REALLY COOL STUFF REALLY COOL STUFF

BUT …BUT …

HIS BOSS WOULDN’T LET HIM! HIS BOSS WOULDN’T LET HIM!



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

Quality Not Enough!

“While everything may be better, it is also

increasingly the same.”Paul Goldberger on retail, “The Sameness

of Things,” The New York Times

What’s Special?

“Customers will try ‘low cost providers’ because the Majors have not given them any clear

reason not to.”

Leading Insurance Industry

Analyst (10-98)

“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

The “10X/10X Phenomenon”

10 Times Better/

10 Times Less Different

“When we did it ‘right’ it was still pretty

ordinary.”

Barry Gibbons on

“Nightmare No. 1”

Context: “No” to “inevitable commoditization”

S1: Lead the Customer!S2: Re-invent with E-Commerce!

S2A: Systems Integration: Fighting Back!S3: Design Matters!

S4: It’s the Experience!S5: Women Rule! (and the elderly)Net: Glorious Age of the BRAND!





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

“Our strategies must be tied to leading edge

customers on the attack. If we focus on the defensive

customers, we will also become defensive.”

John Roth, CEO, Nortel

Lucent Tanks!

Cause(s): (1) Listening to BIGGEST, SLUGGISH

customers. (2) Failing to exploit the Web internally or externally

Source: Business Week (08.07.00)

“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 Everything!

OVERVIEW

www.cyveillance.com

08.12.2000/0509AM:

2,337,711,647

www.cyveillance.com

08.16.2000/0516AM:

2,366,786,869

96 Hours, 07 Minutes …

+29,075,222

Tomorrow Today: Cisco!

87% of $20B*(Cisco Connection ONLINE)

Save $500M(service and tech support)

* = $48,000,000 … per DAY

And Larry?

Oracle ’99 – ’00

Everything [In & Out] via Internet

$1B in ’99-’00[on a cost base of $6B]

$1B in ’00-’01

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]

GE Power Systems/GEPartsEdge

Was: 2 weeks to analyze a major generator problem

Is: 1 hour

Enron: $400B in annual on-line trading transactions. [50% total bus.] Much stimulated by the

Web per se.

Schwab: $25B per week in asset transactions [80% of trades]

[Transition to e.Schwab: Rev. fell, then quickly doubled]

W.W. Grainger*

2X phone/fax

*$220B “MRO” market (per Business 2.0/02-00)

COMMUNITY!/ COMMUNITY SERVICES!

Tomorrow Today: Cisco!

87% of $20B(Cisco Connection ONLINE)

Save $500M(service and tech support)

C.Sat e >> C.Sat HCustomer Engineer

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

Cherry PickingVertical Markets

Plasticsnet.com: $370B; sellers pay $5K to $8K for

“storefront”; 5% to 10% cut

Hook: community services (database, catalogs, forums,

industry job bank, etc.)

B2C Success

“Genuine brand strength”

“Build community”Source: Geoffrey Moore

Community …

Somewhat mediated, segmented chat rooms (must be “managed”/ seeded)User-friendly technical/ professional info

Industry “intelligence”Some very timely stuff/ attractors

Hotlinks by the gazillion (to professional and unrelated stuff)

Expert/ advisor opinions (info, chats, etc.)Opportunity for users to build

own Web page & create own communities

B2B

B2B

1999 – 2004: 50X

2004: $7.4Source: GartnerGroup (per Reuters 1-26-00)

T

GM/Ford/DaimlerChrysler (02-27)

Covisint

$240B (+$500B)I.P.O.

Solectron, IBM, Nortel, Matsushita, Seagate, Etc.

E2Open.com

$700B

Goal?

Drive profits to zero!*

*Remember AMR and “dynamic pricing.”

“Net Nips Real Estate Sales Fees”

Headline, p.1B, USAToday 07.05.00*

*Homebytes.com, eHomes.com, YourHomeDirect.com, etc.

CUSTOMER PERSPECTIVE:

D.I.Y./ CONTROL

Welcome to

D.I.Y. Nation!“Changes in business processes will emphasize self service. Your costs as

a business go down and

perceived service goes up because customers are conducting it

themselves.” Ray Lane, Oracle

Shop in your Underwear

Source: SM’d logo for www.ae.comae = American Eagle Outfitters

Anne Busquet/ American Express

Not: “Age of the Internet”

Is: “Age of Customer Control”

Amen!

“The Age of the Never Satisfied

Customer”Regis McKenna

“In the network economy, the Website becomes the company’s primary interface to the customer.

The user interface becomes the marketing materials, store front,

store interior, sales staff and post-sales support all rolled into one.”

Jakob Nielsen, Designing Web Usability

“Most companies would do more business on the Internet if they

fired their entire marketing department and replaced it with

people who could produce interactive content that actually made it easier for users to buy.”

Jakob Nielsen, Nielsen Norman Group

Red Herring (01/00)

75% of online shoppers don’t complete their

purchase!

RADICAL STRATEGIES

REQUIRED

“Where does the Internet rank in priority?

It’s No. 1, 2, 3, and 4.” Jack Welch

There are 2 Kinds of …

Defense*

vs.

Offense**

*Fend off upstarts.**Reinvent our marketspace!

“One cannot be tentative about this. Excuses like ‘channel

conflict’ or ‘marketing and sales aren’t ready’ cannot be allowed. Delay and you risk being cut out of your own market, perhaps not by traditional competitors but by companies you

never heard of 24 months ago.”

Jack Welch [07.00/Forbes.com]

“There is no use trying,” said Alice. “One can’t believe impossible things.”

“I dare say you haven’t had much practice,” said the Queen. “When I was

your age, I always did it for half an hour a day. Why, sometimes I’ve

believed as many as six impossible things before breakfast.”

Lewis Carroll

ACT NOW, ACT FAST,

KEEP ACTING

Web Strategy: GE Power Systems

“Launch and Learn”(4 sites in 30 days)

“It’s better to be first with less than last with more. Success on

the Web isn’t just about time to market, it’s also about

‘time to learning.’ ”

Jeff Levy, eHatchery

SUMMARY: REINVENT

EVERYTHING

WebWorld = Everything

Web as a way to run your business’ innardsWeb as connector for your entire supply-demand chain Web as “spider’s web” which re-conceives the industry

Web/B2B as ultimate wake-up call to “commodity producers”

Web as the scourge of slack, inefficiency, sloth, bureaucracy, poor customer data

Web as an Encompassing Way of LifeWeb = Everything (P.D. to after-sales)

Web forces you to focus on what you do bestWeb as entrée, at any size, to World’s Best at Everything

as next door neighbor



S2A: Systems Integration: Fighting Back!

S3: Design Matters! S4: It’s the Experience!

S5: Women Rule! (and the elderly)Net: Glorious Age of the BRAND!

Brand Outside

Strategy 2A: Fighting Back via

Systems Integration!

“We want to be the air traffic

controllers of electrons.”

Bob Nardelli, GE Power Systems

“Systems Integrators” Unite [And Conquer]

Cisco’s winning strategy

[USAToday 07.11]: “Become the ‘Go-to’ Systems

Provider”

“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

Defense-Offense: Systems Integration/HVA

Delphi, DanaUnited Technologies,

Corning, GE, Sun, Carpet One, Bud …

[Anybody in their right mind!]

E.g. …

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

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

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

Service-Systems Paradox: Cut & Grow

Automate 75% of “commodity” service activities

and/but

Add value via people-intensive “strategic/systems-integration

activities” (E.g.: Could Sun’s service/sysint business be 60% of revenues?) (Hiring from PWC, etc.)

“A few years ago a consulting contract might have involved installing an inventory

management system or designing a corporate Website. Today, it might include handling

everything from creating a business model and hooking up servers for a dot-com to revamping a Fortune 50 company’s supply chain, marketing

plan or ebusiness strategy.”

Business 2.0, special report on consultants (08.2000); e.g.: Andersen $9B;

McKinsey $3B; IBM Global Services $32B.

“The e-conomy is one of re-intermediation, where new

technologies make it possible to radically increase complexity and

efficiency with the introduction of new marketplaces. In these markets, value

chains constantly reorganize as the demands of the consumer and

business change.”Thomas Koulopoulos, Delphi Group



S2A: Systems Integration: Fighting Back!S3: Design Matters! S4: It’s the Experience!

S5: Women Rule! (and the elderly)Net: Glorious Age of the BRAND!

Brand Outside

Strategy 3:

Design Matters!

And Tomorrow …

“Fifteen years ago companies competed on price. Now it’s

quality. Tomorrow it’s design.”Robert Hayes

All Equal Except …

“At Sony we assume that all products of our competitors have basically the same

technology, price, performance and

features. Design is the only thing that differentiates one product from another in the

marketplace.”Norio Ogha

“Design is treated like a religion at BMW.”

Fortune (10/98)

Drop-dead Charm!

“The new Beetle fails at most categories. The only

thing it doesn’t fail in is drop-dead charm.”

Jerry Hirshberg, Nissan Design International

Design as Soul

“We don’t have a good language to talk about this kind of thing. In most people’s

vocabularies, design means veneer. … But to me, nothing could be further from the

meaning of design. Design is the fundamental soul of a

man-made creation.”Steve Jobs

Message: “Great - Cool Stuff” Matters.

Great & Cool Trumps Not-So-Great &

Ho Hum!

Message Beetle & iMac: “Great Stuff”

Takes Guts!!

The I.D. [International Design] Forty*

Airstream … Alfred A. Knopf … Apple Computer … Amazon.com …

Bloomberg … Caterpillar … CNN … Disney … FedEx … Gillette … IBM … Martha Stewart … New Balance …

Nickelodeon … Patagonia … The New York Yankees … 3M … Etc.

* List No. 1, 1999

Unconventional [Design] Messages

Not about ... “Lumpy Objects”!

Not about ... $79,000 objects

T.T.D./Message:Services are Not Intangible!

You “give off” hundreds of design cues … daily!

YOU ARE A DESIGNER!

T.T.D./“Beauty Contest!”

1. Pick one form/ document: invoice, airbill, sick leave policy, returns claim

form.2. Rate it on a 1 to 10 scale

(1 = Awful; 10 = Scintillating) on three dimensions: Beauty, Grace, Clarity.

3. Repeat … every 15 days.

T.T.D./Design “Awareness”!

STEP No. 1: NOTEBOOK![Start recording the awesome

and the awful.]

“Sometimes I have episodes of wild fury in rental cars. It’s not road

rage. It’s more like design rage.”

Susan Casey, www.ecompany.com

Most Recent Entry/06.22.00

The “manual …

HP LaserJet 1100





Brand Outside

Strategy 4:

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

PlotWilliams Sonoma = 6 [was 10]

Crate & Barrel = 8Sharper Image = 9+

Smith & Hawken = 8+Vermont Country Store = 8+

Garnet Hill = 9L.L. Bean = 5 [was 9+]

Land’s End = 7+Colonial Williamsburg = ?

[NAPM: Think …

Supply Chain-ingB2B-ing]

“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




S4: It’s the Experience!S5: Women Rule! (and the elderly)

Net: Glorious Age of the BRAND!

Brand Outside

Strategy 5:

Women Rule!

?????????

Home Furnishings … 94%Vacations … 92%

Houses … 91%Bank Account … 89%

Health Care … 75%Etc.

$4.8T > Japan

9/27.5/3.6T > Germany

48% working wives > 50%80% checks

61% bills53% stock (mutual fund boom)

43% > $500K95% financial decisions/

29% single handed

Women … 51% of Web users; 6 of 10 new users; 83% of wired women are primary decision makers for family healthcare,

finances, education.Sources: Business Week 11.99;

Jupiter Communications 08.00

New golfers … 37%Basketball … 13.5M

1 in 27 (’70) … 1 in 3 (’96)

1874?

1874 … Jock Strap1977 … Jogbra

1977 ... 25K

1996 … 42M

Yeow!

1970 … 1%

2002 … 50%

OPPORTUNITY

NO. 1!*

[* No shit!]

Carol Gilligan/ In a Different Voice

Men: Get away from authority, familyWomen: Connect

Men: Self-orientedWomen: Other-oriented

Men: RightsWomen: Responsibilities

FemaleThink/ Popcorn

“Men and women don’t think the same way, don’t communicate the same

way, don’t buy for the same reasons.

“He simply wants the transaction to take place. She’s interested in creating a relationship. Every place women go,

they make connections.”

Women and Healthcare

Women are … more dissatisfied, frustrated by the way they are treated

and spoken down to by physicians, seek more information, are more pressed for time … and make 75% of health care decisions and control 2/3 of health care $

$$$ [and constitute 2/3 of health care employees].

Source: Patricia Braus, Marketing Healthcare to Women

Women and Financial Advisors

Women want … a plan, to be listened to, to be taken seriously, to read about it, to think about it.

Women do not want … an in-your-face sales pitch

Source: Kathleen Boyle, Wheat Boyle Butcher Singer

“Women Beat Men at Art of Investing”

Source: Miami Herald, reporting on a study by Profs. Terrance Odean and Brad Barber, UC Davis (Cause: Guys are “in and out” of

stocks more often; women choose carefully and hold on for the long term)

Marketing to Women: Help Them Save Time!

80% … work86% … cook

58% … run errands with kids38% … take child to school

21% … go to the gym21% … take outside classes

How Many Gigs You Got, Man?

“Hard to believe … Different criteria”

“Every research study we’ve done indicates that women really care about the relationship with their

vendor.”

Robin Sternbergh/ IBM

“Women and men use the Web differently. Women are more

pressed for time. For them, the Internet is really a productivity

tool. … Men tend to spend more time on line just playing around.”

Source: Media Metrics/Jupiter Communications

Read This Book …

EVEolution: The Eight Truths of Marketing to Women

Faith Popcorn & Lys Marigold

EVEolution: Truth No. 1

Connecting Your Female Consumers to Each

Other Connects Them to Your Brand

“The ‘Connection Proclivity’ in women starts early. When asked,

‘How was school today?’ a girl usually tells her mother every

detail of what happened, while a boy might grunt, ‘Fine.’ ”

EVEolution

Weight Watchers International “Model”

“What if ExxonMobil or Shell dipped into their credit card database to help commuting women

interview and make a choice of car pool partners?”

“What if American Express made a concerted effort to connect up female empty-nesters

through on-line and off-line programs, geared to help women re-enter the workforce with today’s

skills?”

EVEolution

The New New Jiffy Lube

“In the male mold, Jiffy Lube was going all out to deliver quick, efficient service. But, in the

female mold, women were being turned off by the ‘let’s get it fixed fast, no conversation

required’ experience.”

New JL: “Control over her environment. Comfort in the service setting. Trust that her car

is being serviced properly. Respect for her intelligence and ability.”

EVEolution

“I got a message from the chairman of a multi, multi-billion dollar global company.

I know him really well. He said, ‘Dear Faith, I distributed EVEolution to my female

executives. Thank you.’ I wrote him, ‘Dear X, this book is not about marketing FOR women, it’s about marketing TO women.’

He wrote back about how ungrateful I was; he’d bought 14 copies at full price! Can

you believe it?”

Faith Popcorn, “Cool Friends” interview, tompeters.com

Psssst! Wanna see my “porn”

collection?

“What kind of car does Mommy want?”

“I didn’t know [company] were giving

company cars to secretaries.”

Source: UK financial services CEO, 12/99

27 March 2000: email to TP from Shelley Rae Norbeck

“I make 1/3rd more money than my husband does. I have as much financial

‘pull’ in the relationship as he does. I’d say this is also true of most of my women

friends. Someone should wake up, smell the coffee and kiss our asses long enough

to sell us something! We have money to

spend and nobody wants it!”

Not a Morality Play!

“It is critical that we all understand that IBM is not marketing to women

entrepreneurs because it is the thing to do, or even the right thing to do.

We are marketing to women entrepreneurs because it is a huge

opportunity.”

Cherie Piebes

“If we are single, they say we couldn’t catch a man. If we are

married, they say we are neglecting him. If we are divorced,

they say we couldn’t keep him. If we are widowed, they say we

killed him.”

Kathleen Brown, on the joys of female political candidacy

THIS JUST MIGHT BE THE BIGGEST “THING” IN THIS

SEMINAR. PLEASE: THINK ABOUT IT!

Speaking of Enormous

[Missed] [Huge] Opportunities ...

74/55

“At each stage of their lives, the needs and desires of the baby

boomers have become the dominant concerns of American business and popular culture. If you can anticipate

the movement of the baby-boom generation’s life-span migration, you

can see the future.”Ken Dychtwald, Age Wave

Aging/“Elderly”

2X growth rate$$$$$$$$$$$$

“I’m in charge!”

Good source: Ken Dychtwald, Age Wave

Priorities: Aging/“Elderly”

Experiences … Convenience … Comfort

… Access … Respect!

And Now For A Nod To 1/7th of Our Economy!

“Medicine looks likely to change more in the next 20 years than it has in

the last 200.”

British Medical Journal (11-11-99)

Health Care Tsunami

Prevention/Wellness/Fitness/Holistic/Homeopathic/Non-traditional/

Patient-centric/Web-led

Proactive Engineering/Gene “stuff”[Blockbuster-Bazooka to

Specific-Sniper’s Rifle]

No waste [Healtheon/WebMD et al.]

Alternative Medicine

More visits than to physicians

Same $$$ expenditure [approx $27B]

Stanford study: 2/3 use alt therapies

“This is the first time in Western medical history that we have had a movement that is consumer

driven.”/Dr. Woody Merrell, Center for Health and Healing, Beth Israel Hospital, Manhattan.

[Merrell: Process = Partnership.]

Source: Barron’s/05.15

“Partner for Good Health”

vs.

“Savior for the Sick”

Source: NPR/VPR 08.15.00

SoftWatch (MS)“Manage relationships across the

healthcare continuum”/ Amir Kishon

Establish e-relationships with customers/retain customers/collect data

Patients record info + receive feedback/ online access to nurses

Community with others with MS

Etc.Source: Start-Up

“Online Medical Records Seen Empowering

Patients”

Source: Headline, Boston Globe, 07.31.2000, re 1K docs and 700K

patients @ CareGroup

1965: “ ‘Doctor’ will see you now. ‘Doctor’ will take care of you.”

YES, NURSE. ME GOOD PUPPY DOG.

1995: “HMO will take care of you.”

BULLSHIT.

2005: “I will take care of me. I’d like your expert help.”

Patient-centric* Health Care

Wellness (Fix to prevent.)

Partnership (“Tour guide” model.)

Web (Info and support group availability

RESPECT! (Mutual.)

WOMEN RULE!*Not: HMO-centric, Employer-centric, Insurer-

centric, Doc-centric

Reprise: Dawn of an Age of Self-Determination?

Brand You /end of corporate paternalism

D.I.Y. Everything/ the Internet

Boomers & Health/ “I’m in charge here!”

And speaking of self-determination …

Grameen Bank/Bangladesh

“It’s not people who aren’t credit-worthy. It’s banks that aren’t

people worthy.”$2.3B to 2.3M [typical 1st loan: $15.]

98% recovery rate [94% to women]

1/3rd out of poverty; 1/3rd up to non-poverty threshold

Muhammad Yunus, Banker to the Poor

Grameen Bank: “Borrowing Group”

Self-formed; 5 members; Oral test Group approves all loan requests, but individual liability

(8 Groups to a “Center”) Weekly payment, 1-year loan (5% to Group Fund; if

one defaults, no more loans to Group) No legal instrument

1st loan about $15 (housing loan after 3 successful 1-year loans; property to wife’s name)

Lend to two, then six weeks later two more, Chairperson last

Process aims to exclude non-resilient people

“The Grameen loan is not simply cash. It

becomes a kind of ticket to self-discovery and

self-exploration.”

Muhammad Yunus

Reprise of Reprise: Dawn of …

The Age of Self-Determination!

[ Self-Determination Redux

Micropower (fuel cells) …Microgrids …

“Virtual Utilities”

Source: The Economist (08.2000)]








S4: It’s the Experience!S5: Women Rule! (and the elderly)

S6: Think Global!Net: Glorious Age of the BRAND!

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]

No Room for Brands?

NikeSaturnCNN

America OnlineCharles Schwab

StarbucksThe Gap

IntelEtc.

Brand = Trust!

“Most buyers do not have a clue whether anybody else makes a better microprocessor, but ‘Intel Inside’ has become a ‘trust mark’ - a trademark that consumers put their faith in.”

The Economist

What Can [Can’t] Be Branded?“Branding is not a problem if you have the right mentality. You go to your team and

you pin up a $200 Swiss Army Watch. Competing in the ridiculously crowded

sub-$200 watch market, they made it into a brand name, named after the most

irrelevant and useless thing in history [the Swiss Army]. And you say, ‘Gang, if they

can do it, we can do it.’ ”

Barry Gibbons

“Salt is salt is salt. Right? Not when it

comes in a blue box with a picture of a little girl carrying an umbrella. Morton International continues to dominate the U.S. salt market even though it charges more for a product that is demonstrably

the same as many other products on the shelf.”

Tom Asaker, Humanfactor Marketing

T.T.D./Calling the Corporate Shrink!

“Organizational Psychotherapy”/

WHO WE ARE!

“Corporate Religion is a completely new way of thinking about companies. Today, the product is still the main communication

highway in the company. When companies make the shift to selling solutions, brands and attitudes … communicating the company’s

attitudes and values becomes the decisive parameter for success. It

demands that you find out who you are as a company.”

Jesper Kunde, Corporate Religion

Scott Bedbury/ Nike, Starbucks

“A Great Brand taps into emotions. Emotions drive most, if not all, of our decisions. A brand reaches out with a powerful connecting experience. It’s an

emotional connecting point that transcends the product.

“A Great Brand is a story that’s never completely told. A brand is a metaphorical story that

connects with something very deep - a fundamental appreciation of mythology.

Stories create the emotional context people need to locate themselves in a larger experience.”

Brand = You Must Care!

“Success means never letting the competition define you. Instead you have to define

yourself based on a point of view you care deeply about.”

Tom Chappell, Tom’s of Maine

“In the funky village, real competition no longer revolves

around marketshare. We are competing for attention –

mindshare and heartshare.”Kjell Nordstrom and Jonas Ridderstrale,

Funky Business

“We are in the twilight of a society based on data. As information and intelligence become the domain of computers, society will place more value on the one human ability that cannot be automated: emotion.

Imagination, myth, ritual - the language of emotion - will affect everything from our purchasing decisions

to how we work with others. Companies will thrive on the basis of their stories and

myths. Companies will need to understand that their products are less important than their stories.”

Rolf Jensen, Copenhagen Institute for Future Studies

Brand = Special = Passion = Plot =

Compelling Mythology = Cause = Connection = Heart

Brand Outside

Reprise

Lead the Customer: Why Tough

Guts!Failures!

Re-invention via ecommerce: Why Tough

Total commitment to total enterprise [and supply

chain] reinvention!

Yo, C.D.O.!!!!!!!!

Design: Why Tough

True-believer-dom-shipEncompassing/Cultural

Ing-ing/Experience: Why Tough

Total Reorientation

Women’s Market: Why Tough

EncompassingAttitude

CULTURAL!

Brand Power: Why Tough

Way of LifeForever!

Passion Rules!Touches Everything!It Am Me [Personal!]

Message :

Not for the Faint of Heart!*

*Weenies need not apply



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

“Create a Cause, not a ‘business.’ ”

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

Charles Schwab)

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

recruits.”

Burke Stinson, AT&T

“Leadership is a performance. You have to be

conscious of your behavior, because everybody else is.”

Carly Fiorina

“It is necessary for the President to be the

nation’s No. 1 actor.”FDR

Brand Leadership:ENTHUSIASM RULES!

“I am a dispenser of enthusiasm.”/ Ben

Zander

“A leader is a dealer in hope.”

Napoleon

How sweet it is!

“If things seem under control, you’re just

not going fast enough.”

Mario Andretti

Documents

Distinct or … Extinct Tom Peters Teleconference2000 Arlington Texas 16 August 2000