Tom Peters
Making Money
… for Our
Customers
Seagate/08.08.2001
<1000A.D.: paradigm shift: 1000s of years
1000: 100 years for paradigm shift
1800s: > prior 900 years
1900s: 1st 20 years > 1800s
2000: 10 years for paradigm shift
21st century: 1000X tech change than 20th
century (“the ‘Singularity,’ a merger
between humans and computers that is so
rapid and profound it represents a rupture
in the fabric of human history”)
Ray Kurzweil, talk april2001
Forbes100 from 1917 to 1987: 39 members of the
Class of ’17 were alive in ’87; 18 are in ’87 F100; the
18 F100 “survivors” underperformed the market by
20%; just 2 (2%), GE & Kodak, outperformed the
market from 1917 to 1987.
S&P 500 from 1957 to 1997: 74 members of the
Class of ’57 were alive in ’97; 12 (2.4%) of 500
outperformed the market from 1957 to 1997.
Source: Dick Foster & Sarah Kaplan, Creative Destruction:
Why Companies That Are Built to Last Underperform the
Market
Are all CEOs
bozos? Was Darwin a
Message*:
genius, or what? So,
Boss
Man, whadda you say
about “risk taking” now?
*And “all that” (2 of 100; 12 of 500) was in relatively placid times.
Part I: Brand Inside
Part 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 the old
ones out.”
Dee Hock
“Good management was the most powerful
reason [leading firms] failed to stay atop
their industries. Precisely because these firms
listened to their customers, invested aggressively
in technologies that would provide their
customers more and better products of the sort
they wanted, and because they carefully studied
market trends and systematically allocated
investment capital to innovations that promised
the best returns, they lost their positions of
leadership.”
Clayton Christensen, The Innovator’s Dilemma
The [New] Ge Way
DYB.com
The Gales of Creative Destruction
+29M = -44M + 73M
+4M = +4M - 0M
Success Secret #1
No: “Eternal vigilance”
Yes: “Eternal
skepticism”/
“Honor the assassins”
Brand Inside
Brand Org:
Lean, Linked,
Internet-driven, Virtual
White
Collar
Revolution!
108 X 5
vs.
8X1
= 540 vs. 8 (-98.5%)
Success Secret #2
Embrace the
enormity of the
change.
Brand Inside
Brand Work: The
Professional Service
Firm Model
So what will be the
Basic Building
Block of the
New Org?
Answer: PSF!
[Professional Service Firm]
Department Head
to …
Managing Partner,
HR [IS, etc.] Inc.
“P.S.F.”: Summary
H.V.A. Projects (100%)
Pioneer Clients
WOW Work (see below)
Hot “Talent” (see below)
“Adventurous” “culture”
Success Secret #3
All-groups-as-HVAplayers. No “hangers
on”.
Brand Inside
The Heart of the Value
Creation Revolution:
PSF Unbound!
11 September 2000
09.11.2000:
HP bids
$18,000,000,000
for PricewaterhouseCoopers
Consulting business!
[“These days, building
the best server isn’t
enough. That’s the
price of entry.”
Ann Livermore, Hewlett-Packard]
HP … Sun … GE … IBM
… UPS … UTC …
General Mills … Springs
… Anheuser-Busch …
Carpet One … Delphi …
Etc. … Etc.
“We want to be the
air traffic
controllers of
electrons.”
Bob Nardelli,
GE Power Systems
“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
“UPS wants to take over the
sweet spot in the endless loop
of goods, information and
capital that all the packages
[it moves] represent.”
ecompany.com/06.01 (E.g., UPS Logistics
manages the logistics of 4.5M Ford vehicles,
from 21 mfg. Sites to 6,000 NA dealers)
Springs
Collections.
Flexible sourcing.
Packaging.
Merchandising.
Promotion.
Design.
Systems & Site mgt.
= Turnkey.
Success Secret #4
Winners will be full-scale
strategic partners in
designing & executing
CRSs/Customer
Revolution Strategies.
Brand Inside
Brand You:
Distinct …
or
Extinct
Brand You, Big Time!
I AM AN
ARMY OF
ONE
Success Secret #5
[empower
themselves to] be fullWinners will
scale strategic partners in
designing & executing
CRSs/Customer Revolution
Strategies.
Bill Parcells’ World/
Brand You World!
BLAME NOBODY!
EXPECT NOTHING!
DO SOMETHING!
Brand Inside
Redefining the Work
The WOW
Project
Itself:
“Reward excellent
failures. Punish
mediocre
successes.”
Phil Daniels, Sydney exec
WOW! Insanely
great! BHAG (Big Hairy
Audacious Goal). Make
Something Great.
Astonish Me. Make It
Immortal.
Words:
“Learn not to
be careful.”
Photographer Diane Arbus
to her students (Careful = The sidelines,
per Harriet Rubin in The Princessa)
Joe J. Jones
1942 – 2001
HE WOULDA DONE SOME
REALLY COOL STUFF
BUT …
HIS BOSS WOULDN’T
HIM!
LET
Characteristics of the “Also rans”*
“Minimize risk”
“Respect the chain of
command”
“Support the boss”
“Make budget”
*Fortune, article on
“Most Admired Global Corporations”
The greatest danger
for most of us
is not that our aim is
too high
and we miss it,
but that it is
too low
and we reach it.
Michelangelo
Success Secret #6. Remember …
The greatest danger
for most of us
is not that our aim is
too high
and we miss it,
but that it is
too low
and we reach it.
Michelangelo
Success Secret #6A
If you can’t say “big
hairy audacious
goal” with a straight
face, then do Seagate
a favor and resign.
Brand Inside
Brand Talent: The
Great War for Talent
“We have
transitioned from an
asset-based strategy
to a talent-based
strategy.”
Jeff Skilling, CEO, Enron
From “1, 2 or you’re out” [JW]
to …
“Best Talent in each
industry segment to build
best proprietary
intangibles” [EM]
Source: Ed Michaels, War for Talent (05.17.00)
Message: Some
people are
better than other
people. Some people
are a helluva lot
better than other
people.
“AS LEADERS, WOMEN
RULE: New Studies find
that female managers
outshine their male
counterparts in almost
every measure”
Title, Special Report, Business Week, 11.20.00
Women’s Stuff =
New Economy Match
Improv skills
Relationship-centric
Less “rank consciousness”
Self determined
Trust sensitive
Intuitive
Natural “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
Enron
COO: Louise Kitchen,
F, 29; created
EnronOnline as
“Skunkworks”
The Cracked Ones Let in the Light
“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
enough
weird people in
“Are there
the lab these days?”
V. Chmn., pharmaceutical house, to a lab director (06.01)
Talent Leadership Model 24/7:
Sports
Franchise GM
33 Division Titles. 26
League Pennants. 14
World Series: Earl Weaver—0.
Tom Kelly—0. Jim Leyland—0.
Walter Alston—1AB. Tony
LaRussa—132 games, 6 seasons.
Tommy Lasorda—P ,26 games.
Sparky Anderson—1 season.
Why Don’t Most Biz Mgrs.
Think This Way?
“Coaching is winning
players over.” *
Phil Jackson
*Not: “planning,” “implementing,” “clear
communication,” “getting the org chart right.”
FindDevelop-Mentor
Goal of the Year No. 1*:
ONE Extraordinary
Person.
*CEO, large financial advisory firm, April 2001
Success Secret #7
Talent scouting &
development are special
skills. Honor them.
Reward them. Obsess on
them.
Brand Inside
Reprise:
THINK WEIRD: The
High Standard
Deviation Enterprise
Saviors-in-Waiting
Disgruntled Customers
Fringe Competitors
Rogue Employees
Edge Suppliers
Wayne Burkan, Wide Angle Vision: Beat the
Competition by Focusing on Fringe Competitors,
Lost Customers, and Rogue Employees
“The highest performing companies have
well-developed systems for killing ideas
their customers don’t want. As a result,
these companies find it very difficult to
invest adequate resources in disruptive
technologies—lower margin opportunities
that their customers don’t want—until they
want them. And by then it’s too late.”
Clayton Christensen, The Innovator’s Dilemma
Success Secret #8
Think weird. Partner
with weird. Lunch
with weird. [Hint: These
are weird times.]
Part I: Brand Inside
Part II: Brand Outside
Part III: Brand Leadership
Forces @ Work II
The Sameness Trap
“The ‘surplus society’ has a surplus of
similar companies, employing
similar people, with similar
educational backgrounds, working in
similar jobs, coming up with similar
ideas, producing similar things, with
similar prices and similar quality.”
Kjell Nordstrom and Jonas Ridderstrale,
Funky Business
“We make over three new
product announcements a
day. Can you remember
them?
Our customers can’t!”
Carly Fiorina
Success Secret #9
Beware six-sigma
parity!
Brand Outside
Strategy 1:
Use E-Commerce to
Re-invent Everything!
Enron eWorld: “Price a structured
trade,” per John Arnold, 26: Early
1999: 30 times a day. Late 2000: 30
times per … minute.
Long-term gas contract. 1989: 9
months, 400+ deals. Late 90s:
2 weeks, 2 per week. Late 2000:
5 such deals per day
Source: www.ecompany.com (1/2001)
A DREAMER’S
MEDIUM!
“There’s no use trying,” said Alice.
“One can’t believe impossible things.”
“I daresay 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
I’net …
allows you to
dream dreams
you could never
have dreamed
before!
…
“Ebusiness is about rebuilding
the organization from the
ground up. Most companies today
are not built to exploit the Internet.
Their business processes, their
approvals, their hierarchies, the
number of people they employ … all of
that is wrong for running an
ebusiness.”
Ray Lane, Kleiner Perkins
Success Secret #10
Think
humongous.
Think big.
Brand Outside
Strategy 2:
It’s the Experience!
“Experiences are as
distinct from services
as services are from
goods.”
Joseph Pine & James Gilmore, The
Experience Economy: Work Is Theatre
& 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
The “Experience Ladder”
Experiences
Services
Goods
Raw Materials
1940: Cake from flour, sugar (raw
materials economy): $1.00
1955: Cake from Cake mix (goods
economy): $2.00
1970: Bakery-made cake (service
economy): $10.00
1990: Party @ Chuck E. Cheese
(experience economy) $100.00
Message:
“Experience” is the
“Last 80%”
“Experience” applies to
all work!
HP Revisited
PWC Consultants lead Business
Re-invention Process (“Experience
Economy”)
Fabulous Customer Service (“Service
Economy”)
Terrific Servers (“Goods Economy”)
“Experience”: Home
to [tomorrow’s]
Market Cap!
Success Secret #11
Think
“experience.”
Think big. Think
humongous.
Brand Outside
Strategy 2A:
A Case in Point: The
Four Seasons
Why I Stay at the
Four Seasons Chicago
Comfort.
good to be home.”)
(“It’s
Why I Stay at the
Four Seasons Chicago
The doorman. (Recognizes
me.)
“The two most
powerful things I know
in existence:
a kind word and a
thoughtful gesture.”
Ken Langone, CEO, Invemed Associates
Why I Stay at the
Four Seasons Chicago
access to
technology is
The
excellent. (I’ve trained them in this!)
Why I Stay at the
Four Seasons Chicago
Chalone
chardonnay they leave
The bottle of
for me. (They “remember.”)
Why I Stay at the
Four Seasons Chicago
The fact that the GM
always puts his desk
chair in my room when
I’m in town.
Why I Stay at the
Four Seasons Chicago
The fact that I feel
okay arriving in shorts
and a baseball cap. (Even
though they serve princes & sheiks.)
Why I Stay at the
Four Seasons Chicago
No hairs in the
bathtub. (Operational
excellence.)
Why I Stay at the
Four Seasons Chicago
The Brand.
(I trust Izzy.)
Why I Stay at the Four
Seasons Chicago: Payback!
It ain’t free.
Success Secret #12
This “technology stuff” is very
But don’t
forget the “human
stuff.” [It rules in the
cool.
end???!!!!]
Brand Outside
Strategy 3:
BRAND POWER!
“WHO ARE
YOU [these days] ?”
TP to Client
“Most companies tend to equate branding with the
company’s marketing. Design a new marketing
campaign and, voila, you’re on course. They are
wrong. The task is much bigger. It is about fulfilling our
potential … not about a new logo, no matter how
clever. WHAT IS MY MISSION IN LIFE? WHAT
DO I WANT TO CONVEY TO PEOPLE? HOW DO
I MAKE SURE THAT WHAT I HAVE TO OFFER
THE WORLD IS ACTUALLY UNIQUE? The brand
has to give of itself, the company has to give of
itself, the management has to give of itself. To
put it bluntly, it is a matter of whether – or not –
you want to be … UNIQUE … NOW.”
Jesper Kunde, A Unique Moment
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
“A great company
is defined by the
fact that it
is not compared
to its peers.”
Phil Purcell, Morgan Stanley
“You do not merely want to
be the best of the best. You
want to be considered
the only ones who do
what you do.”
Jerry Garcia
“Brand Promise” Exercise: (1) Who
Are WE? (poem/novella/song, then 25 words.)
(2) List three ways in which we are
UNIQUE … to our Clients. (3) Who
are THEY (competitors)? (ID, 25 words.)
(4) List 3 distinct “us”/”them”
differences. (5) Try “results” on
your teammates. (6) Try ’em on a
friendly Client. (7) Big Enchilada:
Try ’em on a skeptical Client!
1st Law Mktg Physics: OVERT BENEFIT
(Focus: 1 or 2 > 3 or 4/“One Great Thing.”
Source #1: Personal Passion)
2ND Law: REAL REASON TO BELIEVE
(Stand & Deliver!)
3RD Law: DRAMATIC DIFFERENCE
(“Dramatic” = DRAMATIC. Q.E.D.)
Source: Jump Start Your Business Brain, Doug Hall
Success Secret #13
Are you very/absurdly clear
as to the
…
“DRAMATIC
DIFFERENCE”?
Part I: Brand Inside
Part II: Brand Outside
Part III: Brand Leadership
Brand Leadership
Passion Rules!
Message: Leadership is
all about love! [Passion,
Enthusiasms, Appetite for Life,
Engagement, Commitment, Great
Causes & Determination to Make a
Damn Difference, Shared Adventures,
Bizarre Failures, Growth, Insatiable
Appetite for Change.] [Otherwise, why bother?
Just read Dilbert. TP’s final words: CYNICISM SUCKS.]
“You must be
the change
you wish to see
in the world.”
Gandhi
“A leader
is a dealer
in hope.”
Napoleon
Ben Zander:
“I am a
dispenser of
enthusiasm.”
“Create a
Cause, not
a ‘business.’ ”
Gary Hamel, Fortune (06.00), on re-inventing a
company (Exemplar #1: Charles Schwab)
“Let’s make a
dent in the
universe.”
Steve Jobs
Have you
changed
civilization
today?
Source: HP banner ad
Sales2001
The Sales25: Great Salespeople …
1. Know the product. (Find cool mentors, and use them.)
2. Know the company.
3. Know the customer. (Including the customer’s
consultants.) (And especially the “corporate culture.”)
4. Love internal politics at home and abroad.
5. Religiously respect competitors. (No badmouthing, no
matter how provoked.)
6. Wire the customer’s org. (Relationships at all levels &
functions.)
7. Wire the home team’s org. and vendors’ orgs.
(INVEST Big Time time in relationships at all levels & functions.)
(Take junior people in all functions to client meetings.)
Great Salespeople …
8. Never overpromise. (Even if it costs you your job.)
9. Sell only by solving problems-creating profitable
opportunities. (“Our product solves these problems, creates
these unimagined INCREDIBLE opportunities, and will make you
a ton of money—here’s exactly how.”) (IS THIS A “PRODUCT
SALE” OR A WOW-ORIGINAL SOLUTION YOU’LL BE DINING OFF
5 YEARS FROM NOW? THAT WILL BE WRITTEN UP IN THE
TRADE PRESS?)
10. Will involve anybody—including mortal enemies—if
it enhances the scope of the problem we can solve and
increases the scope of the opportunity we can
encompass.
11. Know the Brand Story cold; live the Brand Story. (If
not, leave.)
Great Salespeople …
12. Think “Turnkey.” (It’s always your problem!)
13. Act as “orchestra conductor”: You are responsible
for making the whole-damn-network respond. (PERIOD.)
14. Help the customer get to know the vendor’s
organization & build up their Rolodex.
15. Walk away from bad business. (Even if it gets you fired.)
16. Understand the idea of a “good loss.” (A bold effort
that’s sometimes better than a lousy win.)
17. Think those who regularly say “It’s all a price issue”
suffer from rampant immaturity & shrunken imagination.
18. Will not give away the store to get a foot in the door.
19. Are wary & respectful of upstarts—the real enemy.
20. Seek several “cool customers”—who’ll drag you into
Tomorrowland.
Great Salespeople …
21. Use the word “partnership” obsessively, even
though it is way overused. (“Partnership” includes folks at
all levels throughout the supply chain.)
22. Send thank you notes by the truckload. (NOT ENOTES.) (Most are for “little things.”) (50% of those notes are
sent to those in our company!) Remember birthdays. Use
the word “we.”
23. When you look across the table at the customer,
think religiously to yourself: “HOW CAN I MAKE THIS
DUDE RICH & FAMOUS & GET HIM-HER PROMOTED?”
24. Great salespeople in great technology companies
can affirmatively respond to the query in an HP banner
ad: HAVE YOU CHANGED CIVILIZATION TODAY?
25. Keep your bloody PowerPoint slides simple!
Success Secret #14
“Let’s make a
dent in the
universe.”