Wednesday, June 29, 2005


Podcasting started as a rage some months back (its less than a year) and is becoming a rage and coming mainstream fast.

Think about it. From blogs we have moved so fast to get audio content into people's computers and iPods (that's where the name has come from).

The great thing is Apple has realised that this is something which they should capture and have released their latest version of iTunes, the 4.9 version which has podcast listening built it. As from Apple, it has made it easier to search, find, subscribe and add your podcast. Wow!

The entire podcasting ecosystem has been created. They now have 3000+ podcasts and new ones have started getting added.

You can check out PodFinder from Adam Curry where he introduces to new podcasts. Radio Channels have started podcasting from ABC News, CBC News and many others. Then you have ameaturs like The Graduates. You have GM on Cars and the Gilmore gang.

I think this is an amazing new medium. It does require lots of bandwidth, more HDD space and lots of new time unless you have a iPod where you can carry it along on those bus rides or exercise times.

Are the marketing guys looking at this new medium?

Sidenote :

I am moving furniture to my new home tomorrow. I need to a pooja (traditional Indian ceremony) before I get the furniture in. Something like housewarming.

Sadly, I will be the only person attending it. Anyways, will blog about it and post some pictures. It sure sounds exciting.

I also ordered for my ADSL2 Internet connection. Adam Internet in Adelaide provides speeds upto 22 mbps (that's right guys, MBPS). Most of them get 10 mbps - 15 mbps. Its still good.

So waiting for it come in and then I can do a lot more things with my iBook. Ya, if I can earn the cash to upgrade its RAM from a measly 256 MB to 789 MB.

What is Profit?

I have been having these MBA style discussions with one my peers, Sarah. Sarah is bright young lady from Qatar. You can see the spark in her eyes when you talk about Qatar and what you can do to make things better in Qatar.

We discuss a lot of politics, religion and other stuff which are not suitable for this weblog however we do once in a while discuss our course too!

In working through the Introduction to strategy in our course (CMP) we have been constantly coming back to two topics - Competitors and Profit.

One of the problems that I see with the way we are taught is that there is a heavy emphasis on Competitors in most strategy models and ideas.

In the world that we live in it is surely the case that we cannot implement any strategy without dealing with competitors. I think that is a given. However, due to the over-emphasis on this particular idea a lot of the students only talk about Competitors as strategy.

From my point of view Strategy is about creating the future of your organization. It is about implementing the vision/mission. It is about realising the dreams that the organization has created itself for.

In the course of doing this we do encounted a lot of competitors and other players in the society. These players could be enhancing or disturbing your vision. This is when you learn to start dealing with them.

For example, the famed Porter's five forces model talks about how various market players will decrease the profits of an org. Porter also misses to add other factors like marketing & advertising. The biggest factor he misses is government. In a lot of cases all around the world the Government shapes the structure of the market.

This could be in terms of regulation (alcohol etc) or licensing (telecom, radio) or tariffs (import and export tariffs) or trade support (subsidies, anti-dumping policies) to shape the structure of the market.

Another important insight which he missed was that the various players in a market are not always going to decrease an org. profits. They can enhance them too. This is what Nalebuff and Brandengerger prove in their book Co-Opetition or what they call Value Net.

As I was discussing these various ideas I started to think about how and why strategy can be used in not-for-profits?

But, why have some org. labelled themselves not-for-profits?

Is it because of the obvious reason that being profitable is not connected to making a difference to the society. Do you have to be unprofitable to make a difference to the society? I cannot understand that.

For me I believe that business is a force for good. Not all businesses. But definately some of them are good. But why did profit come in the way?

What is a business?

Individual businesses are established in order to perform economic activities. With some exceptions (such as cooperatives, non-profit organizations and generally, institutions of government), businesses exist to produce profit. In other words, the owners and operators of a business have as one of their main objectives the receipt or generation of a financial return in exchange for expending time, effort and capital.

What is a non-profit organization?

A non-profit organization (often called "non-profit org" or simply "non-profit" or "not-for-profit") is an organization whose primary objective is something other than the generation of profit.

Wikipedia defines profit as :

Profit is defined as the residual value gained from business operations.

refers to the amount of profit received relative to the amount invested, often measured by a rate of profit or rate of return on investment.

Economists and accountants measure profit in slightly different ways, profit will only be the same when all the factors of production have been credited their full opportunity cost.

Economists usually define profits as revenues less the opportunity costs of labor, capital, and materials. Furthermore, profits are divided into two types:

  • Normal profits are the salaries paid to executives in exchange for their entrepreneurial skills.
  • Economic profits are what remain after normal profits are subtracted. It is the economic profit that economists see as the incentive for firms to enter or leave a market.

In the accounting sense of the term, net profit (before tax) is the residual after deduction of all money costs such as; wages, rent, fuel, raw materials, interest on loans and depreciation.

What we have see is the traditional definition. All organizations can be classified into what can be called a black-white classification. Org. whose goal is to make a profit and Org. whose goal is not profits.

Getting the entire world (we are a societies of organizations now) into just two categories is not only silly it is downright stupid.

What is or better what should be the goal of a business?

Drucker provides us the definition :

Three roles of Management
Drucker teaches us three roles of management. The first role is to accomplish the function that is specific to each organization; in other words, to contribute to society through its business. If it is a newspaper company, it is to publish the best paper. If it is a greengrocery store, it is to supply the best vegetables. It is only a monastery deep in the mountains that does not have to contribute to society directly. It is only a gangster connection that does not have any intention to contribute to society. All other organizations must contribute to society, because they are allowed to exist, occupy, and hire the most valuable in society.

The second role is to make work productive and people achieving. Man as a social existence seeks to exert his ability fully, to fulfill his potential, and contribute to society. Especially from now on, we will enter an age when people will leave an organization that cannot make work productive, and satisfy them in achieving through their strengths.

The third role is not to give any negative impact on society, and to contribute society in solving its problems. This is so-called the social responsibilities of the organization.

If this is true, then what is profit and why has it become the main cause of an existence for a business.

Drucker says profit is, first and foremost, a cost for today and tomorrow. Fortunately, it fulfills the role as a measurement to know how the organization functions well. According to Drucker, it is dubious that a desire called profit motivation exists. It is only an assumption of classical economics that could not explain the cause of economic activities.

In psychology, there are materialistic, sexual and other desires, but no profit desire. Running a business for profit motivation would end up as running a business for greed. Moreover the word profit motivation causes needless misunderstanding and antipathy against business activities. Sadly, even though a top executive himself is not working for the purpose of moneymaking, he uses the word without giving it much thought.
There you go : "It is only an assumption of classical economics that could not explain the cause of economic activities." This is the main reason profit has been understood wrongly. It has been ingrained in the minds of executives around the world that we have forgotten to ask the definition itself.

It is important for us to know the reason for the existence of profit so that we then design our organizations and implement our strategies without the burden to "maximize a firm's profits" as expounded by the classical economists.

Thursday, June 23, 2005

Reflecting on CMP

One of the ideas that I have seen and the patterns that I have observed in both CMP and Leadership Dynamics is the rejection of one-size-fits-all and the embracing of situational ideas.

In Strategy, the various schools are made into a single process and each style used for a specific situation.

In a similar fashion, in Leadership Dynamics, the first Reading is about using different leadership styles at different times depending on the situation.

The hint which I need to understand here is that there is a need to understand the various techniques and tools and develop and the knowledge and wisdom necessary to use them at the right time. That is the crucial challenge.

The University can only provide us with guidance, with structure and direction, it can provide an environment and resources to study, it can and will provide ideas and authors relevant to the course and it can teach what can be taught. In fact it will concentrate mostly on what can be taught in a university (atleast one in the present form of organization).

What is left for students is to understand various ideas, learn tools and techniques, develop some skills but always swing back to experience, reflection and writing as the way to develop understanding. Through time and thought we can develop Wisdom.

This in a way is the understanding of the Uni in the bigger scheme of things for a student.

The discussion with bryan has provided some similar conclusions about marketing. The University can concentrate and provide some quantitative skills which can be easily taught (comparitively) however, it is upto the student to understand the needs and select the electives which he can mostly learn in a Uni and others which he can learn himself and in the job.

Wednesday, June 22, 2005

An Examples of Disguise as Marketing

In Disguise as Marketing I have been debating about how a company needs to put up a disguise as its customers which will help it to provide better services.

In a stimulating discussion on SlashDot on Google vs Yahoo apart from some great stuff on innovation and innovative practices I noticed this. (emphasis mine)

And don't forget the customer satisfaction angle. I suspect that what really turns the crank of people at Google is that they can come up with projects that will eventually be used by thousands, potentially millions, of people worldwide. They're thinking like customers, and in fact they are customers themselves... and Google's audience is so large in general that I suspect it means that there will always be a group of customers who can identify and enjoy a given skunk works project. And then the audience gets bigger... it's a bit self-perpetuating.

Google is in a special case here where its employees are its customers too but the main point is that there are people in the company who are thinking like customers and figuring out what these people would require. This could be a niche area to start with but in a course of time they will be can develop a large following.

Thursday, June 16, 2005

Top Marketing Blogs for 2005

Marketing Sherpa has announced the Top Marketing Blogs of 2005.

Seth Godin wins the best individual blog. I think that is absolutely on the dot. Seth is the best in the business. gets a special mentions (which basically means the next best blog). I never read that. Need to check that out.

Ducktapemarketing has been good for small business owners. However, I used to follow that before, but have stopped following it for now.

Small Business trends
gets a special mention. Great going Anita.

Best group blog goes for Marketing Vox. I check this once in a while.

Check out the rest of the blogs at the site.

As I am now moving onto my next term, I will be taking "Creative and Accountable Marketing" and "leadership dynamics" as my two courses for thr term.

I am planning to update my Bloglines Folder on Marketing before that. Also, I am zeroing onto taking "marketing" as my specialization. And it seems that UniSA is famous for its marketing courses.

However, I find it strange that they do not have all the Seth Godin books???

Disguise as Marketing

Rupert Murdoch in one of the most amazing speeches a newspaperman can say about his industry. A acknowledgement of how the industry is changing and getting transformed due to the disruptive force of the Internet.

He said :

We may never become true digital natives, but we can and we must begin to assimilate to their culture and way of thinking.

In the movie, Never been Kissed, Drew Barrymore plays the role of a 25 yr old copy writer in the Chicago-Sun times who is given a opportunity to do her first story as a reporter by being a undercover high school student.

In one of the literature classes, the teacher is talking about shakespeare. He lectures on the specific statement by Shakespeare of "All the world's a stage and we are only actors in it".

The teacher in the movie interprets that as actors our disguises play a large part. And here the story becomes interesting as to how if we are in a different disguise we start doing different things. he says we get a new sense of freedom and start to do new things which we never thought possible.

Like a high school student who would wear his football costume and then start pushing people, pressing other guys bums and generally kick-ass.

The point was that it is normal, since he was in a specific football disguise.

Now, this goes back to the words of Rupert Murdoch that "we, the digital migrants need to understand the digital natives if we have any chance to succeed with the disruptive force of the internet".

All of us in the running of organizations, be it businesses, not-for-profits, those in the govt. everybody needs to start putting up their disguises and understand their customers. the best way for that would be to spend time with them, be like them, think like them and act like them.

Going back to the movie, never been kissed, Drew barrymore tries very hard to be accepted by the "popular kids". You can see the change in her - the dressing changes, the walk changes, the talk changes, the places she goes to changes...what she is trying to do is be like them.

How many of us in the marketing world do that?

Do we try to be like our "popular customers" or do we just try to understand them. And can understanding come without experiencing?

Wednesday, June 08, 2005

Towards strategic flexibility

Trever Cook links to the Association Blog which writes about Strategic flexibility.

“strategic planning, an approach grounded in the command-and-control management model, fails to produce the requisite creativity and dynamism necessary for associations to succeed strategically in the years ahead.”

The point here, I think, is not that strategy is bad or unnecessary, rather that just doing a strategy and faithfully implementing it free of any meaningful interaction with the world is absurd. So:

“in successful companies, tactics drive strategy as much or more than strategy drives tactics. These companies do something and learn from it. It changes their thinking ... Sometimes, the very first tactic you execute changes your plan.

Amen! If you want to get from A to Z, first you must do A. And once you do, guess what -- B changes. You realize B isn't what you thought B was. Or you realize you can skip ahead to D. Or you realize that A didn't work out and you need to start from scratch. Or you realize you didn't really want to get to Z in the first place.”
In reality, of course, great strategists have always adapted quickly to a changing environment and have used their strategic capabilities to quickly assess and respond to opportunities and threats as they arise. The challenge is not to faithfully implement some dusty document, but to be so deeply immersed in the ‘action’, while also seeing that action from a broader perspective, that you can make the strategy a lived reality. We could call this approach to strategy ‘action informed by thought’ rather than ‘action for the sake of doing something’.
But back to command and control:

Old-school association strategic plans lock organizations into mindsets that are outdated before the laserprinter is done spitting them out. They stifle innovation and create a "pass-the-buck" mentality among staff, who are rewarded for following the rules rather than introducing innovation -- and who can easily blame the plan (and by extension, the association's leaders/members) when ideas that sounded good eight months ago in a boardroom fail miserably in the field.

Every one of us has the capacity to be a strategist.  In fact, the capacity to set goals and to think backwards and forwards through time and to conceptualise (think in generalities) – all the skills we associate with strategy and planning – are some of the essential differences between ourselves and other species.
Too often strategies have failed, and got a bad reputation with employees, because they are designed and used as a means of control – the modern version of Taylorism. Instead, we should see ‘strategic thinking’ as a way of making employees more creative, innovative and productive by engaging them fully in the strategy process as a way of life (‘thinking about what we do’) not as a dusty manual.

Thing Big Act Small

Another book from Good to Great style of research. Good to Great is a different kind of book. Rather than having some theories in mind and finding data which fit that jim Collins takes a very different view of strategy and companies.

He went about searching about companies in America which live up to a specific list of data parameters and he found out the "good to great" companies.

Jack Covert from 800-CEO reviews a new book called "Think Big Act Small" by Jason Jennings where he goes about searching 100000 companies in America with the specific data parameter of "increased revenue and profits by ten percent or more for ten consecutive years".

What Jennings' and his research team did was to look at 100,000 American companies and found nine companies that have increased revenue and profits by ten percent or more for ten consecutive years. The nine companies range from retailers like Petco and Cabela's, manufactures like Medline Industries, service companies like Sonic Drive-In, private education companies like Strayer and industrial giants like Koch Industries. Rounding out the nine are SAS, the software company, O'Reilly Automotive and DOT Foods. 
What do all these companies have in common? You guessed it: they all "Think big and act small."

In the book, each chapter focuses on a company and how that company handles one of the ten "Building Blocks." The building blocks are:

1. Down to earth
2. Keep your hands dirty
3. Make short term goals and long term horizons
4. Let go
5. Have everyone think and act like an owner
6. Invent new businesses
7. Create win-win solutions
8. Choose your competition
9. Build communities
10. Grow future leaders.

The book is loaded with insight and easily applicable ideas for anybody interested in improving themselves and their company. I especially like the conclusion:

"We live in interesting times. Complexity causes people to yearn for simple, profound ideas that can be readily related to diverse situations. People gravitate to confidence, decisiveness, and clear, powerful messages, searching for the ultimate metaphysical reference point. So we end as we begin, with this message: to guild an organization with balanced focus, camaraderie, and the ability to prosper over the long term...think big, act small."

Wednesday, June 01, 2005

Systems Mapping of Yuan, Again

In the past I wrote about my course - CMP - where the first part of the course concentrated on this model of thinking called "systems thinking".

In order to get to understand the concepts better I had created a "map of the yuan peg" showing the direction of change and the effect it was having on many factors.

However, the map created using MS Word was not satisfactory.

I found this wonderful application today called the "CMAP Tools". This provides an easy way to create a concept map and it can be used as well of systems thinking. The tools helps you create easy to understand maps easily.

Systems Mapping of Yuan_IM

Click here for a larger version of the map.

I am sure that this map makes better sense than before. Do let me know your thoughts on this.