Competitive Lens

12 Most Basic Strategies to Know Your Competition

[Originally posted on 12Most.com] We live in a world where competition is part of the fabric of life. Survival of the fittest, and all that stuff. The business world is no different. Being about to not only know your competition, but to outsmart them, is just another aspect of the game.

Here are some relatively basic steps you can take to win the competition game. Are they a bit difficult to pull off? Some of them. But if you can get your hands around even a few, you’ll find yourself in a better competitive position:

1. Know yourself better than anybody else
If you really want to evaluate your competition, you have to first understand what YOU have to offer. This will help you define WHO your competition is. If you do this right — and look at your core competencies, you might find that your ultimate competition isn’t exactly who you think it is.

2. Execute your business first
Going back to point 1, if your business isn’t being executed to its fullest, you may like to think that you are competing against top-tier companies, but the reality is that you may be competing against the middle of the pack, and trying to best “the best” is simply never going to work.

3. Listen to their financial calls
You’d be amazed at the information that comes out of financial calls from public companies. And no, you don’t need to be a financial analyst to participate. Sure, you can read about their call the next day, but short of being in the room with them, listening can give you a sense of excitement or tension that you might not get in print.

4. Read voraciously
From public SEC filings to blogs to articles (and even support forums), the amount of information out there that can prove valuable is immense. How are they perceived? What are their customers openly complaining about? Where is YOUR opportunity?

5. Talk to their customers
If you are not talking to your competition’s customers, you might as well pretend you’re in a business that has no competition. Not only can you gain a good bit of information about your competition, but also about their sales cycles, new products that have been promised — even who their sales reps are (rep churn is very valuable information). Who knows, you may even land a customer yourself.

6. Follow their customers on social media
Customers say the most amazing things on social media. Sure, some of it may be slightly anonymous, or a bit questionable. But when you see a trend of #FAIL hashtags at the end of messages about a competitor’s new product, it’s probably worth looking into. And please, don’t just stop there. Some clever searching can reveal a great bit of information about former customers as well (and open up new prospects at the same time).

7. Talk to (or follow) their suppliers
By our very nature, we tend to look forward — to be customer focused. But what about the people supplying product to your competitors? Did they have a good quarter? Did they have a bad quarter? Could it be that their shipment levels (or margins) are tied to your competitor? Absolutely.

8. Follow their employees on social media
Gaining insight into customer sentiment is incredibly valuable. But gaining insight in employee sentiment is even better. When a social media user’s profile states “I work for XYZ Corp, but my posts are my own”, remember that is usually not the case. People talk, and they talk about work. How busy they are, how late they had to stay at work, how high/low their job satisfaction level is… get my point?

9. Visit Q&A sites
With sites like Focus.com, Quora.com, G+ (no, not the Google version) and LinkedIn Answers, it is becoming increasingly easy to find out what questions users are asking about your competitors products, and the type of responses they are getting to their questions. Are they asking about how to configure a product (perhaps a sign of poor technical support)? Are they asking for alternative products (displeasure with their existing product)? Or are they asking the best places to buy a competitor’s product (a sign of positive sentiment)?

10. Listen to their corporate or customer support social feeds
You’d be surprised how much information you can gather my monitoring a company’s “support” feed on Twitter or Facebook (and soon Google+). Sure, they try to move the customer support issues offline as quickly as possible, but there is still enough activity to gain some insight (and social media is fast becoming a way to quickly spot trends in advance of mainstream awareness).

11. Understand their/your market
In a world where change is now measured in days or months, not years or decades, keeping apace of emerging market trends is just as important as understanding your competition and their products/services. Learn to anticipate what changes will disrupt their (or potentially your) business and be aggressive/proactive. Don’t let them dictate your move, rather seek to influence theirs!

12. Buy one of their products
Unless you are talking about a product made from unobtainium (or a service), it is probably worth getting your hands on one of their products. Buy it used. Buy it damaged. Just get it, and figure out how it works and what it is really capable of performing. You’d be surprised how often that slick-looking data sheet doesn’t quite match up to the real deal. And even if the product is a year old, it can still yield some interesting insights into their design process. To be fair, I’m not advocating you break or even bend any laws or copy any intellectual property (be very careful here – designers should be locked in a different room!). But nothing beats actually having something in front of you to figure out how it works and how you can sell against it.

So there you have it — just a few ways that you can get a leg up on your competition. But remember, it all starts with items 1 and 2 — getting your house in order first.


Featured image courtesy of claudiaveja via Creative Commons.

peoples_oil

Why being frictionless is good business

Being social takes work. Communicating across any social network brings with it a level of overhead, both in terms of time and learning. It doesn’t matter if that social network involves flying across the country to meet with somebody or sending out an “I’ve arrived” ping on FourSquare when you land half a world away. They all have overhead. You need to learn how to use the medium efficiently. And you need to learn how to deal with the increased number of social contacts that increased “efficiency” will bring with it.

While social communications channels can greatly expand our ability to reach an ever-increasing number of people, they can also, through their added overhead, bring with them the wrong type of friction and limit the number of networks that we can actually leverage to our advantage. In fact, it can become a very limiting factor in the number of social communications channels that we participate in at any given time.

OVERHEAD EQUALS FRICTION

Consider this. If I use a single social channel to regularly interact with 5 people (assuming they don’t know each other), the level of “channel” overhead is relatively low. I learn how to use the channel and I communicate.

But if those 5 people are all on different communications channels, I have to learn – and keep up with – 5 different channels to keep up with them. That’s overhead – especially if each of those 5 different communications channels has their own social conventions, unique “media-rich” value or medium-based communications limitations.

At the end of the day, the more social communications channels that I utilize (and I’ll toss in email, SMS, my mobile phone and even that occasional hand-written letter – yes, I still write those), the fewer true intimate and personal relationships I can maintain. Overhead equates to unwanted friction.

FRICTION CAN BECOME MORE FRICTIONLESS

As social communications channels grow in number and user adoption (yes, I know, I’m avoiding using the phrase “social media” because this isn’t about “social media”), my ability to reach an ever-expanding number of diverse people increases. And I consider this a good thing.

With reduced friction, I can reach out more fluidly

to a larger number of people

But to make it a great thing, I must overcome the learning curve of a new communications channel and decrease its overhead. Less overhead means the channel becomes increasingly frictionless. With reduced friction, I can reach out more fluidly to a larger number of people. Reducing friction requires one of two things: a user experience that is fundamentally intuitive (with an equally compelling/intuitive use case) or time to figure out how a system works. I prefer the former, but usually settle for the latter. I’m willing to do that because the more I can make a communications channel frictionless, the more likely I am to use it to explore the worlds around me.

FRICTIONLESS COMMUNICATIONS OPENS NEW WORLDS

As I reach out to a larger number of people, the number of diverse perspectives I have access to is amazing. With each perspective comes a unique experience and story. And with each unique story comes a new world of ideas and concepts upon which I can build, and expand, my own world. Over time, my world begins to look a lot less like my world, and a lot more like a melding of those that I touch. In return, the worlds that I touch begin to look a bit like me.

Every world that I look into won’t necessarily fit my perspective, or the rules which define it. There are many that don’t. But for each world that doesn’t mesh, I still learn a bit, and there are an almost endless (well, 7B and counting) number of perspectives that I can look at. And many of those will mesh, or connect, in some way with mine.

“The less friction there is to a communications channel into these worlds,

the greater the exchange of ideas”

The melding of perspectives, experiences, stories and ideas from these worlds is mutually beneficial. The less friction there is to a communications channel into these worlds, the greater the exchange of ideas. In fact, some of my best conversations are not only frictionless within a communications channel, they transcend multiple channels in a single conversation.

It’s not uncommon for a conversation to start with a text message, move to a call on my mobile, shift to a video session (with a few other people tossed in for fun), then shift from a continuous form of communications to a discontinuous form (such as email) only to revive up again on yet another channel. I often respond to a text message with a Skype message, which is frequently responded to by a Direct Message on Twitter which leads to a shared post on Facebook.

THE VALUE OF FRICTIONLESS

Let’s shift our perspective here just a bit. Nothing today is truly frictionless. Friction and overhead still exist, and there is, in fact, value in a certain amount of friction as a filtering mechanism. But friction caused by overhead is usually a negative. Now, let’s apply that to you, your business, your professional life. Have you eliminated unnecessary friction in your communications? Do you even have a strategy to become as close to a frictionless state as possible? Some key steps to consider:

  • Don’t be afraid to use a variety of social channels to meet new people or new customers. You can’t afford to ignore the chance to at least sample what new social channels have to offer.
  • Not only seek out channels with inherently low friction (overhead), but take the time to learn about, and respect, new communications channels, and find ways to deal with their overhead/friction. If the overhead friction is too high, take a step back and move on. If the friction doesn’t decrease on its own, it probably won’t be a viable channel for others either.
  • Open your world to others, in exchange for a view into their world. Remember to accept their ideas and needs as readily as you are willing to push your ideas and products to them – being frictionless in your sharing and communications is a two-way street.
  • Be willing to take the conversation, be it collaboration, sales or customer support, from one social channel to another, as your mutual relationship grows, or your need to communicate changes, and
  • Be willing to take the effort to move from relationships to friendships, from customers to trusted clients.

While we always need a bit of good friction in our lives, seeking to eliminate bad friction, and being as frictionless as possible – especially in our social communications – can be very rewarding.

Image “Peoples Special Motor Oil” by Steve Snodgrass, Licensed under Creative Commons

CopenhagenPlatform

Social Media: The community IS the platform

I’m going to get right to the point. Platforms don’t define communities, communities define platforms. And when platforms try to define a community, they almost always alienate the community, which, in turn, finds another venue on which to communicate. Simple? Yes. But, unfortunately, most social media “platforms” have yet to grasp this concept.

SOCIAL MEDIA PLATFORMS AREN’T REALLY PLATFORMS

My colleague, Alan Berkson, recently wrote an excellent piece about Twitter and their disconnected view of themselves as a platform, questioning whether they really know what business there are in. He speculated that they don’t, and I tend to agree.

Twitter doesn’t understand the value of their own business. To paraphrase what Alan Berkson said in his post:

Sipping from the stream can be both enlightening and refreshing. But Twitter doesn’t have to own the entire stream.”

Rather than realize that they are an enabler at the epicenter of one of the greatest ecosystems ever (See Nigel Cameron’s 10 Amazing Facts about Twitter), Twitter has instead focused on dominating and owning the ecosystem that made them what they are today. In doing so, they’ve limited the choices of their user community and consistently restricted the availability/utility of some amazing 3rd party “interface” and “partner” applications – a move that may be beneficial in the short-term, but will prove to be limiting in the long-term.

If I’m a member of Twitter’s ecosystem, I’m seriously rethinking my reliance on Twitter for my bread-and-butter money.

YOU DON’T OWN COMMUNITIES… THEY MERELY RENT YOUR SPACE

What many social media businesses haven’t yet grasped is that it isn’t about their venue, it’s about the communities that support them. I live in many different social venues, covering a wide range of topics, such as global events, business trends, government and law, science and technology and social advocacy. These, and many other collective communities, not only define the platforms they exist on, they ultimately become the basis for applications and value to exist.

Social media is like a buffet. People don’t want to see the same food at every station.”

More importantly, communities often cross traditional “platforms” with ease. I belong to many groups who regularly communicate via multiple mediums, based on the type of discussions that are taking place. Part of the discussion may be held on Twitter, while other parts of it may take place on Facebook, Skype or Google Hangouts.  Each venue has its own value proposition, and none of them can emulate all others and still add targeted value.

DICTATE YOUR PLATFORM AND COMMUNITIES WILL MOVE ON

The beauty of social media is the variety it places in front of us. It can be a phenomenal research and discover tool, as well as a tremendous outreach, mobilization and engagement tool. But we always need to remember:

  • No single venue can offer a one-stop package (and I wouldn’t want there to ever be just one choice),
  • The best social media venues are those that recognize the value of the community, and match the technology to the community’s needs in a unique fashion, and
  • If you really want me to use your social venue, you need to demonstrate to me that you value the ecosystem around the venue you have built – after all, individuals users are just as much a part of that ecosystem as corporate partners. If you disrespect your partners, or are unwilling to accept their value, what does that say about the ecosystem role you are offering to me, and the members of my various communities?

Image (Kongelundsfortet Platform) courtesy of EuroMagic, licensed under Creative Commons

demrepDonkeyHotey

Have we created an online VETO button?

Obamacare, SCOTUS and the Online Veto Button: We all know the power of the “veto” – the ability to simply over-rule all others and say “no” to a particular situation. We see it in many aspects of our lives, from the United Nations Security Council (where it is often used as a political tool) to our own households (where it is often used as a parenting tool). Increasingly, however, we are witnessing a new form of veto in the online/social space, a result of two trends: the Proliferation of Pervasive Communications (#PervasiveComms) and the Rise of Online Activism.

POLITICS AS UNUSUAL

In early 2012, my colleague Alan Berkson and I wrote about the online anti-SOPA/PIPA protests (Stop Online Privacy Act & Protect Online IP bills). In that case, we witnessed a well orchestrated “grass roots” online campaign to stop (preemptively veto?) two pieces of legislation in the US Congress – legislation that very few in Congress had actually read (ironically, the overwhelming majority of the online protestors had not read the legislation either – they were following the lead of a few that they trusted, and ultimately the lead of the movement itself).

I had the opportunity again to dig into an online campaign issue, this time in the form of participating in a Huffington Post Live discussion addressing President Obama’s Affordable Care Act (affectionately known as Obamacare) and the pending decision by the US Supreme Court (SCOTUS) on the Act’s constitutionality (primarily with regard to Interstate Commerce regulations and the Act’s individual health-insurance mandate).  While much of the debate about this issue is playing out in traditional media, a series of increasingly vocal debates and online communities have emerged to “rally the troops” in favor of, or against, the Act (side note, both political campaigns have “digital czars” in place).

Here’s the video:

What we are presently witnessing is the development of a massive series of online awareness campaigns designed to coalesce networks of online activists. The main difference today, in contrast to the SOPA/PIPA protests, is that it is two equally strong forces (Republican backers/Democratic backers) who are leading the charge.

While I believe that their ultimate goal is to shape the post-SCOTUS debate (leading up to the election), their message today is one of rallying people to shape the opinions of politicians (likely), the broader public (extremely likely) and the Court itself (incredibly unlikely).

THE VETO IN THE BUSINESS WORLD

In the business world, we’ve seen similar events, the issue of “Net-Neutrality” (that continues to play out in both the public forum and political back offices) being a good example of corporations trying to harness the power of the Web to rally support for their side of the argument.

We’ve also seen individual companies, such as Facebook, Google and BP, become the target of online activist/awareness campaigns – something increasingly being used to shape how, and where, a company does business, from the board-room to Wall Street and beyond.

Toss all this together, with an increasingly sophisticated understanding of how to “mobilize” an online community and leverage the power of “conformity“, and you have the perfect recipe for a crowdsourced online VETO button. The power of the “social” masses to now change the course of politics and business is greater than it has ever been (and will only increase as both politics and business continue to shift from brick-and-mortar/in-person activities to online engagement).

Looking back at HP, and their turmoil over the past year, I can easily see how many of their investors, distributors and consumers would have delighted in the ability to activate an online veto button over the actions of HP’s Board of Directors.

ARE THESE THE RIGHT QUESTIONS?

Some questions to consider:

  • Have we actually reached the state of an online VETO button? Is this a good or a bad thing?
  • Is it possible to tell the difference between a “manipulated” and “grass roots” information campaign? 
  • Should politicians and businesses be swayed by online campaigns that may be more “manipulated” than “grass roots”?
  • How can misinformation campaigns (that may attempt to influence by false or misleading, but seemingly true, information) be countered?

There are some serious issues that we face as we integrate our digital, online, lives deeper into our offline lives, and there are no easy answers to the questions above (are we even asking the right questions here?). More importantly, does online activism risk getting diluted by non-authentic conformity and a false sense of anonymity?

Image courtesy of DonkeyHotey Licensed via Creative Commons

Fred McClimans #140MTL State of Now Montreal Quebec

Pervasive Communications & Biological Big Data

I recently had the pleasure of speaking at the #140MTL State of Now conference, on May 15th, 2012, in Montreal, Quebec. It was a fantastic event, with some great speakers and wonderful attendees.

As part of the event, I had the opportunity to discuss a few concepts that are helping to shape global events and trends, and how we interpret them, including Pervasive Communications (see a great write up by Alan Berkson), Biological Big Data, and the value of ad hoc social interactions and the information they can reveal about each person’s unique, and contextual, perspective.

I hope some of these points resonate with you, and welcome your feedback and comments. This discussion is far from over.

starlings murmuration

Crowds, Individuals and Conformity

I’ve always been fascinated by crowds — how they form, why they form, what influences them, and what, in turn, they have the ability to influence. I’ve also always tried to differentiate between crowds and communities, the latter being a more “refined” version of a crowd. Communities have purpose, and common bonds that bind the individuals together. So when I came across a couple of choice documentaries recently, that explored the nature, and science, of crowd/community behavior (and what it means as an individual within a crowd or community) the questions started flying. Fast.

STARLINGS and MURMURATIONS

I came across a brilliant documentary by Marcus du Sautoy, part of the BBC’s “The Code” series, in which he mathematically explains the amazing”Black Sun” murmurations that starlings form every year on their annual migration. Watching tens of thousands, perhaps a hundred thousand or more, fly in seemingly random, yet fluid, ever-changing pattern was both amazing to watch, but it also begged the question “how”? It turns out, as Marcus, explains, that you can mathematically recreate a murmuration of starlings with three basic rules: all birds should fly at approximately the same speed, they should stay close to their neighbors, and they should avoid predators (danger).


If you follow these three simple rules, it turns out that each starling need only keep track of (be influenced by) their seven closest neighbors. And those seven neighbors are constantly changing as the murmuration morphs in flight.

Might not the same basic rules apply to human behavior and individuals within a community or crowd?

INDIVIDUALS and CONFORMITY

After watching the BBC documentary, I stumbled across a great show on the Discovery Channel – Head Games. In this particular episode, they were delving into the nature of human conformity – could they make people conform to a belief or behavior that they inherently knew was wrong or incorrect?

During their experiments, they were able to convince a group of individuals that a snake was sitting high up in a tree — so much so that these individuals went on to convince others that there was indeed a snake in the tree. They described its shape, its color, its movements. But there was no snake.

During a second test, they were able to get a group of people to follow a red line through a museum — even though the red line took them away from the main exhibits (at one point having them actually walk in a circle around a pole).

After digging a bit deeper, I came across a study referenced in Science Daily that demonstrated an innate predisposition in humans to need to conform, as well as a predisposition in certain people (based on the size of certain regions of the brain) to have a higher-than-normal tendency to need to conform. To belong. To be safe. In other words, to not stand out or put themselves at risk.

THE QUESTIONS

After viewing the videos, digging deeper into the “conformity predisposition” and tossing the ideas about, a series of questions began to take shape…

  • At what point, if ever, does a group of individuals become a crowd (with collective influence and behavior)?
  • Can a group influence you in the same way that an individual does? (Can they be one of your “7”)?
  • At what point does conformity override our individual opinions and actions?
  • At what point does a crowd attain the characteristics, and influence, of an individual (if ever)?
  • Does conformity result in a faster shift in our opinions? Or do we still focus on our closest friends to define our behavior?

If you have any answers, I’d love to hear them. Let’s compare some notes. I’m far from done with this subject.

Werner Heisenberg

Mr. Heisenberg meets #BigData?

1927 was a very good year for Werner Heisenberg, and, in an odd twist, those wrestling with Big Data and the identification of global events and trends that are shaping our future, a mere 85 years later.

Heisenberg was a brilliant physicist, yet his work on Quantum Theory and the Uncertainty Principle may help us shape how we look at many of the issues that we face today in the non-Brilliant-Scientist realm.

“One can never know with perfect accuracy both of those two important factors which determine the movement of one of the smallest particles—its position and its velocity. It is impossible to determine accurately both the position and the direction and speed of a particle at the same instant.” ~ Werner Heisenberg

Heisenberg’s statement has been quoted, mis-quoted, adapted and modified to suit any number of ideas over the decades, so excuse me if I twist it myself to make a point.

In 1926 and 1927, when Heisenberg was laying the foundation for, and publishing, the Uncertainty Principle, we were in a world where Big Data didn’t exist as we know it today. We were also far from being globally hyper-connected, and the idea of Pervasive Communications was a dream of the future.

TAKE A QUANTUM LEAP

I was recently having an interesting, and ongoing, Twitter discussion about Big Data and the value of Curation with some friends (Alan Berkson, Colin Hope-Murray, Peter Bordes and Robert Moore). In response to a question about the value of too much data, or data that was too old, I tweeted “old info doesn’t die, it reveals long-term trends”.

As I looked at what I had written, Heisenberg (oddly, also part of the ongoing discussion) kept coming to mind, ultimately prompting the question “How do we determine the long-term value of an event or data point, and ultimately the value of a trend if it lacks the right context?” This question became all the more important as the different perspectives that frame “context” began to come to light. No two people see the same particle or event from exactly the same personal perspective.

THE RIGHT STUFF

It became increasingly apparent that our discussion of “too much” Big Data was really about having the “right data”. But how do you determine the right data? In many cases, you can’t. We’ve plugged ourselves into this giant fire-hose of Social Media and can’t digest it all.

In the end, most of us can only “sample” off the feed. But in sampling, we get a very accurate description of what is happening at that particular moment, but we can’t tell where what we are sampling fits into the bigger picture. Is this data “byte” the beginning of a trend? Is it supporting a trend that already exists? Or is it perhaps signaling the evolution, or end, of a trend? Is it possible that we can’t answer these questions unless we are continuously sampling from the buffet that is available courtesy of Pervasive Communications and our always-on data feed?

THE MEANING OF LIFE

As we talked a bit about this issue offline (if you consider a couple of hours on a Skype video call “offline”), I came back around to the tweet about the value of old data revealing trends. Perhaps we’re looking at Big Data and the online fire-hose in the wrong way. Too often we think we already know the questions, or we already know the trends, and we look at data points as a way to support our pre-existing notions (numerologists often have a particular knack for this – you can find anything if you look hard enough in the wrong direction).

So rather than always trying to consume information to answer questions, what if we just taste the data, and let it help us form the right questions, regardless of the sector, the market or even what the data was originally supposed to represent? Why not let information from the Transportation sector be co-mingled with information from Politics, or Economics, or Energy. By doing so, we’re helping to erase preconceived notions about the value of the data, and the answers we expect to get.

Ultimately, that’s what it’s all about, isn’t it? As Alan pointed out in his recent post Big Data: Is The Answer 42?, answers are meaningless if you don’t understand the question, and with today’s glut of data, events and trends, figuring out the right question, and understanding why it’s the right question, is more difficult than ever.

FINDING THE INFLUENCE OF UNCERTAINTY

Heisenberg talked about particles, their position and their velocity. I’m talking about events, their impact and their influence (their ability to form trends). In either case, the more certain we are of something, the less certain we are of something else. To me, that raises the question of value in being uncertain, to an extent.

Knowing the present state of an event or data-point is extremely valuable, as is knowing the direction it is heading. But equally important is the value of knowing why it is where it is at a particular moment and why it is heading in a particular direction (what influenced it, what shaped it). Following that lead, it’s also important to know where it is heading and what it is going to hit (how will it influence something else).

“Why a trend exists is just as important a question as asking what impact will result from the trend. It’s all about context.”

As the data reveals more potential trends, so too does it raise more interesting questions:

  • What value do individual events have, either as singular events or as part of a larger data set?
  • How important are multiple layers of context and different perspectives?
  • How do you anticipate when or how trends may collide or intersect?

The next time you sift through the data, as you swim through the stream, try squinting your eyes a bit. Don’t focus so much on what you see, but rather let some uncertainty creep in, and see what patterns emerge when you see things just a bit “fuzzy”.

In the end, you might be surprised at what you do see, and the questions you start to ask.

ZeroKlout2

Klout, Big Data and the Meaning of “Opt Out”

Is it possible to have a Klout Score of Zero (K = 0)?

Why, you might ask, would anybody want to have such a score in the gamified realm of influence measurement, where higher scores indicate a higher level of perceived online influence?

The answer may lie in the way that Klout profiles you, branding you a Specialist, an Observer, or a Broadcaster. The answer may also lie in how people relate to Big Data, vaguely defined ranking algorithms, and the increased tendency of offline organizations to make some big, and potentially misleading, assumptions about the role of online influence in an offline world.

“Klout calculates billions of data points across over 100 million influencers every day.” ~ Klout.com

Whatever the reason, there are people who simply want out.  But opting out, and driving your score to a meaningless Zero, is apparently a bit more difficult in the Klout dimension than one might imagine.

I PRESENT TO YOU MR. SAM FIORELLA

Mr. Fiorella was recently referenced in a Wired.com article (What your Klout Score really means) that delved into an experience he had a while back with a potential employer, who eliminated Sam (and possibly others) from the list of candidates based on his perceived “sub-par” Klout Score. As listed on the Klout.com website…

It’s not the first time something in the online world has impacted a decision in the offline world, and it definitely won’t be the last (see Jeremiah Owyang’s post “How ‘Social Profiling’ Will Work In The Real World“).

Sam ultimately did improve his Klout Score (into the 70’s) but was never happy with the idea of being ranked (or branded) by an algorithm for online OR offline purposes. So when Klout offered an “opt out” option at the beginning of November, 2011, he promptly did just that. He opted out and initiated the deletion of his Klout profile, per the language on the Klout site:

Klout Opt Out

As far as Sam was concerned, he was satisfied that after opting out nobody would be able to view his Klout Score moving forward and that only trace data would remain in the system (for 180 days, after which it would be removed).

He also understood that Klout would continue track his activities on the public broadcast social site Twitter. 

Note: I wouldn’t be surprised if Klout NEEDS to track Sam privately in order to accurately determine the Klout Scores of others within his Twitter social graph. In essence, influencers who are not tracked become dark matter, or invisible thought leaders. They mess with what we perceive by influencing behavior in unseen ways. 

But there was also a level of expectation that the information gathered on Twitter (and his resulting private Klout Score) would to be kept private and OFF the Klout.com site.

Unfortunately, it didn’t work out that way.

I PRESENT TO YOU MR. SAM FIORELLA’S GHOST

In the name of full disclosure, I know Sam personally and I am a registered Klout user. I was also aware when he, and others, opted out of Klout last year. So when I read the Wired article, and the various other articles and posts that it spawned, the analyst in me was just a bit curious to see if Sam had in fact been removed from the site. So I search Klout.com and found no public profile or information on him.

But I did come across the profile of a friend of mine, and attached to that profile, in their Influencers list, was the smiling face of Sam Fiorella. On the site, exactly where it should not have been.

Apparently, the phrase “you will be removed from Klout.com within 24-48 hours” – as mentioned in the Klout opt out statement – may not mean what you think it means.

Sam opted out from Klout almost 6 months ago. Could this possibly be the “trace data” mentioned in the Klout “opt out” statement?  I don’t believe so, as his current Twitter avatar is on display along with an assumingly current Klout Score of 52 (which sounds plausible since Klout appears to be pulling his data only from Twitter, not the complete list of social sites that Sam previously had linked to his Klout account, and it increased to 53 last night).

But wait, there’s more (thank you Ron Popeil). While I did pass on the option to invite Sam back to Klout (he wouldn’t have accepted anyway), I couldn’t resist the chance to test the software and see if it would allow me to give him a +K in Blogging. It did:

I’m not sure the +K stuck (even though it does now show me a greyed out +K button for Sam and Blogging, it apparently didn’t decrement my +K counter).

But the mere fact that it allowed me to go through the action, give me a success notification and offer the option to Tweet the +K out, was more than just a bit interesting – it was a challenge to figure out what had gone wrong, how it might be corrected and to think strategically a bit about some of the larger (beyond Klout) implications it might have.

FOR YOUR CONSIDERATION

From a social perspective, you cannot deny that influence exists – marketing, advertising and sales people have been trying to identify and target influential consumers for years. Nor can we deny that our online and offline lives are colliding extremely fast, and influence in one medium can, and will, transcend to another.

From an online influence measurement perspective, there is a defined need to look for insights in online behavior (served by Klout and other firms such as PeerIndex, Twitalyzer, TweetLevel, etc.), and the people at Klout have been very honest and open with me, and others, about how and why they are undertaking this task. 

But there is a disconnect when a phrase like “removed” appears to mean “erased a bit” – not quite how I would interpret it.

CAN WE ACHIEVE ZERO?

When Sam opted out of Klout, he assumed that he would still have a Klout Score, but that his information would no longer be shared or visible to others – in essence giving him a public null Klout Score (K = 0) that he sought. While the data would still exist, and be interpreted by Klout, they would not share their interpretations with others.

So why is Sam Fiorella still appearing on Klout? Perhaps there is an issue that weaves around Klout’s interpretation of words, and the managing of expectations from a contractual Terms of Service (TOS) perspective. Or perhaps it has to do with the massive amounts of Big Data that we are crunching on an ongoing basis, with technology evolving at such a rapid pace that glitches and ghosts, while unacceptable, are going to occur. Either way, there is a flaw somewhere in the system, and Mr. Fiorella has become its poster child.

PRIVACY AND PERVASIVE COMMUNICATIONS

Sam’s issue with Klout is bigger than either Sam or Klout. Not to diminish what Sam is going through, neither Sam nor Klout are alone in facing issues regarding personal data, big data, privacy or changing technology. If anything, his dilemma is indicative of a much larger series of questions and issues that we face.

We live in an age of technology-enabled Pervasive Communications. Our ability to communicate with almost anyone, anywhere at any time, over a multitude of communications channels, is allowing us to unleash our DNA-driven need to create, share and consume content and information with others.

As we do this, our public actions are increasingly tracked, tagged, shared and mined by people and companies that we’ve never met. They’re sifting through piles of Big Data looking for patterns, for trends, for clues regarding what influences our decisions, and how our decisions influence – if at all – the decisions of others. This isn’t necessarily a bad thing, but when this activity lacks true transparency of both intent and use, the user is increasingly, and unknowingly, giving away far more than they are receiving in return.

“There is nothing in the dark that isn’t there when the lights are on.”

~ Rod Serling

The data is out there and it’s not going away. It may lose some of its relevance, but it will still be out there and is increasingly being linked with other data to create “new” data. The questions of who really owns our data (both pre and post-processing), how and when it can be shared and reused, and how much light (transparency) should be shined upon it, will likely be argued (and should be) for many years to come.

While many individuals may argue that they want their data out there (in an effort to achieve a richer, more engaging online experience), I do believe that there are different times and places for private and public, and, as individuals, businesses and governments, we need to continually ask ourselves:

  • What should the ground-rules be for how Terms of Service and ownership of data are defined?
  • How will we let these definitions and rules evolve and adapt to technology and human behavior patterns that don’t yet exist or have yet to be defined?
  • How can we provide true transparency (in simple terms) to online users regarding their data and its linkages with other data (there’s a business out there if you can create that infograph, BTW)? And,
  • How we are going play together in an ever shrinking sandbox where transparency has become a buzz-word and personal privacy continues to become increasingly elusive?

I also believe that when an “opt out” option is offered, as it was with Klout, it should be just that – a way for you to take yourself, and your data, OUT of the system. If not for your actions, the data wouldn’t exist in the first place.

 Note: Images adapted from Klout.com

Disruption and (non) Innovation, Part II

Explosive Hits Disruption and InnovationThe words “Disruption” and “Innovation” have become lexicons of our current business vocabulary. But while they are closely linked, they are (as mentioned in my post Disruption and Innovation, Part I) two very different beasts.

Not surprisingly, I increasingly hear people speak of their organizations as being disruptive in a market, of having a disruptive strategy (that is often further described as being “innovative”).  

Granted, there are some strategies that are, in and of themselves, true innovations that lead to the disruption of existing markets and the creation of new markets. For example, Ron Popeil’s televised take on the “But wait, there’s more!” product marketing strategy was arguably an innovation that created new markets, created market value that previously didn’t exist, and was ultimately disruptive to others.

Disruption creates chaos. Chaos cannot be controlled.

By definition, a strategy is not the same as an innovation. But a strategy can be innovative, and it can also be disruptive, and there are no shortage of organizations out there today that love to talk about their disruptive strategies.

But is being disruptive in a market, or towards a competitor, a viable strategy? Is it sustainable? Or is it merely something that is best used in an opportunistic manner?

Chaos cannot be controlled, but it can be leveraged.

Personally, while I almost always caution clients against relying upon disrupting their competition, or a market, as a business strategy, there is a part of me that understands the value of leveraging an opportunity to disrupt the flow of a competitor.

THE SEVEN DISRUPTIVE SINS

How an organization attempts to disrupt its competition is often tempered by the depth of their pockets, the desperate nature of their situation or their willingness to push (or even outright cross) the lines of the law. But, putting aside graft and corruption, most organizations tend to gravitate to the same Seven Disruptive Sins when it comes to disrupting their competition.

I call them sins, for while they may have their virtues or desired effect, they may also come back to bite you. Hard

To every action there is always an equal and opposite reaction.

~ Sir Isaac Newton

So let’s take a look at the most common strategies I see used, misused and abused by organizations to disrupt their competition…

1. Talent Acquisition: pulling key personnel away from a competitor, in an attempt to limit their competitiveness.

Pro: Acquiring great talent in any area of your business is always a good idea (top sales reps, developers, executives, support staff, etc.). And when pulled from your competitor, can limit, or at least disrupt their footing for a period of time.

Con: Pulling top staff from a competitor usually means offering a sweeter, more costly deal. It also opens the door for your competitor to potentially find a new, more creative or hungrier, replacement. Add in non-compete agreements (especially where customers or IP are concerned) and ultimately you may have just overpaid for talent AND given your competitor an opportunity to lower their own operating costs.

2. IP Acquisition: buying patents, or even entire companies, in an effort to keep (or take) the technology away from competitors. For example, during the dot-com boom, larger firms were buying up smaller firms left and right – not just because they needed the technology but to take it out of the market (a great example today would be the recent sell off of Nortel patents, or the likely interest a sell-off of RIM patents would generate).

Pro: By locking up a piece of technology that your competitor may rely upon or leverage in the future (a good example would be buying a smaller firm that resells product through a competitor), you can take away portions of their product/services portfolio.

Con: Buying anything costs money. And who isn’t to say that your competition will, as a result of your action, be forced to rethink their product/service strategy and develop a new one that isn’t more in touch with customer demand? More importantly, companies need to be nimble in today’s market. Technologies change fast, and you don’t want to be left holding outdated product.

3. Flooding the Market: selling products or services well below market price in an effort to take away customers and revenue from your competition (something we see often at the international trade level). Interestingly (thanks to Alan Berkson for this example), we see this all the time in the Cable TV and Mobile sectors, where vendors undercut their competition (through special contract pricing) to win customers that they know they will lose after their 12/24 month contract is up.

Pro: You can’t argue with the value of taking away market share from your competition.

Con: Every time you underprice your product, or give away an extra service, you are taking profit out of your pocket – something that few firms can afford to sustain for any period of time.

4. Supplier Acquisition: controlling the supply of parts, either through exclusive deals or acquisition, to restrict competitor’s access. If everybody in a market relies upon Company X for certain technology, bringing that supplier under your umbrella can force competitors to shift their own strategies (note: this is not the same as developing your own in-house alternatives to parts/components that are universally used within a market, such as Apple building their own chip fabrication facility).

Pro: Controlling the supply of commonly used products in a market can certainly be a competitive strength (imagine if Apple bought Intel…). It can provide (after the cost of acquisition is recouped) lower cost of goods sold.

Con: You buy it, you’re stuck with it. Take something away from somebody and they’ll find a way to engineer something better. Just as nature abhors a vacuum, so do markets. Pull a key component out of a market and somebody will find a way to replace it (with something faster, better, cheaper). Lesson: don’t force your competition to become innovative.

5. Distribution Acquisition: controlling the distribution channels for your product – a great example being the exclusivity agreements that restricted food chains from selling both Coke and Pepsi products.

Pro: If you can prevent your competitor’s product from ever appearing on the shelf, you’ve clearly got an advantage.

Con: Linking yourself to a particular distribution channel is great, until that distribution channel falls to deliver, or has competitive challenges of their own (think McDonalds/Burger King and Coke vs Pepsi).

6. Legislation/Regulation: pushing the enactment of laws and regulations that favor you, or restrict your competition is a practice as old a government and provides for a thriving lobby economy at the state and federal level. A similar example is the tactic that government contractors employ to “shape” government procurements in such a way that the specifications of the requirement can only be met by their product or service.

Pro: If you can control the playing field, you can control the game. By enacting legislation (or bid specifications) in such a way as to preclude your competition, you’ve given yourself home-field advantage.

Con: Putting aside the issues of potential corruption, laws and regulations are usually enacted in a particular context to address a specific requirement. But laws and regulations rarely go off the books, and all too often they are applied in ways totally unintended. For a great example, check out Wickard v. Filburn and the Agricultural Adjustment Act of 1938 which was intended to stabilize US wheat prices but is now being used to restrict a variety of activities, including the personal growth of medicinal marijuana in states where such use is allowed.

7. Creative Marketing: taking a bit of poetic license when talking about a competitor’s product. In politics, we’d call this a smear campaign.

Pro: Highlighting weaknesses, or shortcomings – especially when documented by others – can be a great way to position your competitor’s product in a dim light.

Con: Nobody likes to be misled or fed partial information, and while spreading Fear, Uncertainty and Doubt is a mainstay part of both business and political culture, in the age of Pervasive Communications, fact checking is available 247. Even if your data about a competitor is true, ultimately, the continued use of this approach will be viewed as “dirty politics” and reflect poorly on you, not your competition.

SOME THOUGHTS

Disruption is a part of nature, and it is no surprise that we see it often in markets. But intentionally trying to create a disruptive strategy carries its share of risk and can take away from the value proposition of a company’s own product and services. In the end, if a company doesn’t focus on their own products and services first, disrupting a competitor won’t add any value as they won’t be in a position to leverage the (often temporary) disruption to their advantage.


Photo of EMI Album by Hans Thijs, Licensed under Creative Commons

brokenbulb2

Disruption and Innovation, Part I

Over the years, as an analyst, advisor and even as an entrepreneur, I’ve heard the phrase “Our strategy is to disrupt ” far too often. It’s a bit disheartening at times, because what I really want to hear is how your strategy is going to “innovate” rather than disrupt.

Why? I’ve always believed that the fastest way to success is to avoid trying to knock somebody off the ladder and, instead, build your own ladder. You control your future. You shape the market. You let the people on the other ladder pursue their evolutionary strategies while you quietly create a revolutionary strategy.

THE RELATIONSHIP BETWEEN DISRUPTION AND INNOVATION

To be clear, there is a definite relationship between “disruption” and “innovation” not to be confused with Clay Christensen’s “Disruptive Innovation”. Often, they feed off of each other – one leading to the other (or at least providing an opportunity for the other to take hold).

Innovations within a market can ultimately lead to the disruption (or devastation) of an existing or adjacent (but different) market (example: iPhone’s App store devastating video games, wrist watches, cameras). Note that true innovations don’t just offer better versions of existing products, but offer better alternatives to existing products – they ultimately replace them.

Similarly, disruptions within a market (or a vendor if they dominate that market) can often provide an enhanced opportunity for new and innovative vendors and products. The more disruptive a market has become, the greater the opportunity for innovation to create a new, better alternative market. But there are differences.

And far from being singular events, disruptions and innovations can often be associated with long-term evolutionary trends, rather than singular events (Pervasive Communications is a great example of two trends (technology and human behavior) leading to a disruption of both social structures, technologies and global markets (check out Alan Berkson’s framing of Pervasive Communications and a video chat with Brian Reich on the global implications of Pervasive Communications).

DISRUPTION

Disruption, like the stuff that hits the fans, often just happens. It can be caused by any number of different conditions. Disruptions to supply chains. Technological advances. Corporate mismanagement. Natural disasters. All can result in a market (and its vendors) being disrupted. In the extreme, the disruption devolves into a state of chaos – and chaos (while it may offer opportunity for those able to restore order) is usually not a characteristic of a market you want to enter.

To this last point, the notion of “disrupting” a market of a vendor to gain a competitive advantage is more often than not simply the wrong approach (a great example being the often asked question in the analytical/advisory space: “Why hasn’t anybody been able to disrupt Gartner’s business model”). To disrupt an entrenched vendor’s business model means to disrupt their market, which may be extremely difficult/impossible to achieve without disrupting your own chances of stepping in to take advantage of the opportunity (an issue we’ll discuss in Part II).

INNOVATION

Innovation, on the other hand, is more often the result of a “spark” or idea that transcends the products, services and strategies of an existing vendor or market. It creates something new: its own ladder. Rather than competing head to head against an existing market or vendor, it offers an alternative that, if done correctly, is often unnoticed by other vendors. It doesn’t (initially) compete for the same budget, nor does it require a “magic quadrant” or an “us vs them” comparison.

A true innovation stands alone – it is its own product and market replacing the need for existing products and markets. It obsoletes prior structures (an issue we’ll discuss in Part III) and represents – in both the short- and long-term – a new market opportunity.

While a new innovation may ultimately compete for overall corporate/consumer dollars, it is often differentiated enough that it can initially sit along-side existing products and simply blend into the landscape. In fact, the best innovations are the ones that existing market players don’t deem as viable – very different from a product evolution that may be considered cannibalistic if they were to implement it themselves.

Taking it deeper, a true innovation will ultimately replace the need for existing products, vendors and even markets. All though not common, the “existing products” *may* not actually exist (although the need for them may – the case of the impractical market), or if they do exist, they *may* under-perform or not currently meet market demand (something that may not be obvious or intuitive to either consumers or vendors).

Take, for example, the iPhone (introduced only five years ago in 2007). In and of itself, it wasn’t a true innovative product, but rather an evolutionary extension of existing multi-media phones (like the Blackberry). But the Apple App Store – when combined with the iPhone (in 2008) – was a true innovation. It created a new market, obsoleted others and forever changed the way that hundreds of different products (as applications) were brought to market.

MOVING FORWARD

In the next few posts we’ll discuss the different types of disruptions and innovations that commonly occur, and the risks and rewards that accompany each (here’s a thought to ponder: most disruptions – especially man-made – offer more risk than reward, while most innovations offer tremendous reward with very little risk).

Have a different perspective? Toss it out. There are plenty of opinions on this subject and I’m looking forward to the debate.

“Oops!” Broken Lightbulb photo courtesy of Kyle May licensed under Creative Commons

Note: Post updated to highlight and clarify distinction between “disruption and innovation” and “Disruptive Innovation”

analysis – innovation – execution