Category: Management

Friday, 8.24pm

Sheffield, U.K.

The artist forges himself to the others, midway between the beauty he cannot do without and the community he cannot tear himself away from. That is why true artists scorn nothing: they are obliged to understand rather than to judge. – Albert Camus

How do you react when you first see something new – a new service or a product or an idea?

Do you react with cynicism, with scepticism – perhaps a view that it will never work.

Or do you eagerly try new things, knowing that if you don’t you won’t find those gems hiding among the stones?

Fear, uncertainty and doubt are our friends – they help keep us alive.

Our brains are wired to distrust the new, the unfamiliar until we’re sure it’s not going to eat or sting or poison us.

But we’re also social creatures, evolved to live together while constantly engaging in fractious tussles for turf and power.

And we’re not very different from our ancestors in that respect – monkeys have a strong sense of social hierarchy and status – and it governs much of what they do every day.

Now, what does that tell us about the way we work together – or more importantly, the way we should work together.

Let’s take any business, for example – probably one that’s based on an individual skill.

The other day I read a LinkedIn post where a provider of a particular service was called by a prospective customer asking for prices.

Later, when the provider researched the prospect it turned out that the prospect was actually a competitor – who then advertised the same service at a slightly lower cost.

You might argue that what the competitor was doing was smart market research, or you might feel that it was unprofessional behaviour.

Regardless, what it tells you is that the competitor saw the service they were providing as a commodity, something that was interchangeable with what someone else did.

And that leads to a problem.

If you’re selling something that is no different from what a number of other people are selling then the only difference is price.

In such markets the lowest cost operator will win.

You might be able to maintain margins for some of the time – but eventually many markets end up being dominated by a large commodity trade and a small luxury trade.

Take glasses, for example – the things that you wear.

You can pay a lot of money in a shop, even more if you’re buying a brand or treat it as an item of jewellery.

But you can also buy it for not very much through online services.

But the thing about being a commodity is that it’s as much about the way you see yourself as what’s actually happening out there.

If you see yourself competing in a crowded, jostling market, selling things that anyone else could sell then you’re not going to have much fun running your business.

It will feel crowded and you’ll always be limited in what you can charge and how much you can grow.

At the other extreme you may have something unique but if it’s too different, too out of the ordinary, then you won’t have customers willing to take a chance on you.

That’s a lonely place – the kind where inventors who fall in love with their products go – when they stop listening to their markets.

A workable business, on the other hand, probably has principles of community at its core.

If you provide a service then you probably want to be in the company of other professionals who care about their subject enough to be expert at it.

More importantly, they need to have spent enough time on their craft to develop their own unique approach – one that doesn’t compete with your approach but that makes the whole field richer.

Take any industry, for example, say graphic design.

Graphic design is a field where a designer could have free rein to create amazing designs that delight customers.

Or they could turn out the same basic patterns again and again for different customers.

Or they could create pure art that no one really understands and therefore no one buys.

In that field you have people who experience business in all three ways: too crowded, too lonely and just right.

But it’s the same field.

What’s different is the approach and attitude they bring to their business.

All too often people blame the market for their lack of success.

Perhaps we should be asking ourselves what we bring to the market – what’s unique, rare, different about what we do?

Because the market, at its core, is the aggregation of lots of little decisions made by buyers and sellers.

Individual decisions.

Like the ones you make about whether to be a commodity or to be much much more.

To be part of a community.

Cheers,

Karthik Suresh

Wednesday, 9.43pm

Sheffield, U.K.

information is the primary basis of value in knowledge work, and it must flow to the right person in the right form at the right time at the lowest cost with the highest quality possible. – Matthew May

I’ve been thinking about the challenges we have as individuals and as managers in organisations when it comes to knowledge work.

Work based on knowledge has really only been a thing for a few decades or so.

And before that, you have to remember that work based on manual effort is also a relatively recent thing.

Yes, people toiled, in fields or for others or as soldiers, but modern manual work is a relatively recent thing in human history.

What makes this kind of work different is that it’s industrialised, professional and treats workers better than they were treated in the past.

That’s the kind of work a lot of people did after the Second World War, as the productivity of each worker increased massively.

Because the methods that made manual workers were so successful, they have seeped into our consciousness as the “right way” to do things.

And so we use the principles developed to do manual work better to try and manage knowledge work as well – and find that it just doesn’t seem to do the job.

Why is that and what should we be doing differently?

To answer that question a paper by Peter Drucker called Knowledge-Worker productivity: The biggest challenge is worth a read.

The first thing that’s interesting is that Drucker argues that there was a period Before Taylor and a period After Taylor.

Frederick Winslow Taylor was the guy who studied how work was done and broke it into a sequence of simple, repeatable steps and effectively put in place the foundations of all “developed” economies.

What’s slightly startling is that Drucker says that all methods since then including Deming’s work and the Toyota Production System build on the system of thinking – the principles – that Taylor put in place.

Taylor said that you should look at the task and break it down into its components.

Get rid of stuff that isn’t needed, reorder steps so that they are simple and easy to follow – create a job that can be done again and again – and then redesign your tools to make it even simpler and faster to do the job well.

Manual work is all about how to do the job – and how to do it better and faster with less effort.

So, we apply this approach to knowledge work as well – we tell programmers how to set up their frameworks, we create processes for administrators to follow.

But in knowledge work the main issues is often figuring out what the task is in the first place.

And that requires a different set of skills – it’s more about listening and exploring than about doing and organising.

When it comes to actually doing the work, manual work is about meeting standards.

If you make a cup you want each cup you make to be about the same.

If you’re making steering wheels, every one that you make has to be within a certain tolerance if you want it to fit.

With knowledge work, on the other hand, you want the best quality you can get.

You don’t want an OK surgeon – you want someone who is very good at what they do.

The same goes for teachers and programmers and managers.

Quality in manufacturing can be measured while quality in knowledge work is often only seen through the experience of the customer.

Finally, when you’re looking at manual work you see it as a cost.

Ideally, you’d like to do three times the work, with half the people being paid twice as much – because people in this situation are costs that you need to reduce.

Knowledge workers, on the other hand, produce more the more they know, and are more valuable the better they get.

Having the best professors or the best surgeons on your team lets you raise your prices and get the best customers.

The thing with manual work is that an organisation has to take responsibility for developing its workers – managers have to work on the system to help them do their best work.

With knowledge work it’s perhaps more dependent on the worker to learn and develop – the company can give them projects and training but they have to really want to become the best they can be.

Companies that support this well become places knowledge workers want to work at – and that gives those companies a competitive advantage over those who think of them in the same way as they do manual workers.

When it comes down to it knowledge is about using information to create value.

And we’re all in the business of doing that these days.

Cheers,

Karthik Suresh

Monday, 8.56pm

Sheffield, U.K.

Costs do not exist to be calculated. Costs exist to be reduced – Taiichi Ohno

I learned about something called Baumol’s cost disease recently and it got me thinking about how rare it for organisations to really understand the impact costs have on their customers.

Warren Buffet is famous for avoiding technology businesses – which is strange considering how technology businesses seem to dominate the world these days.

We are fooled, however, by thinking that because Apple, Microsoft, Google, Facebook, Amazon, Netflix appear to be doing so well that’s the way of all technology businesses.

Except these are the rarities – the ones that succeeded, for which the stars aligned.

For every one of these, thousands, perhaps tens of thousands of technology businesses have gone bust.

And that’s because they don’t understand a simple principle that Buffett articulated a long time back.

Most tech businesses come and tell you that they’re going to cut costs – they’re going to make you lean and quick and reduce the cost of doing business.

That’s almost always the sales pitch – if you use us you will save money and improve margins.

They’re right about the first part – you might save money.

But these tech businesses will sell their tech to you and to every one of your competitors – so you’ll all be able to save money.

And when you’ve got those margins someone will blink – and offer lower prices to customers – and then you’ll all have to follow suit or lose business.

So, the only people who benefit from your investment in technology are your customers – who get lower costs.

Now, it might seem like a vicious circle – one you can’t get away from.

After all, would you still be holding onto typewriters rather than buying computers for your staff?

But the important point is that the advantage of technology is actually not that much of an advantage – you don’t often lose if you want and buy later rather than being the first mover.

In fact, waiting can be an advantage, because you then buy cheaper, better tested product rather than new, untried stuff.

While tech businesses promise to cut costs other industries just seem to see costs increase without any corresponding increase in productivity.

People in public service are paid more for not doing much more than they were doing a decade ago, for example.

Salaries have to rise, apparently, to keep people who would otherwise move to better paid jobs in other sectors.

So, even though people aren’t producing more they’re paid more – which inevitably works its way through to lower margins for the business – because few industries can pass through all their increases in costs to customers without being asked some rather awkward questions.

Which means people in these roles get comfortable and happy without having to do much more.

Now, in the middle of a healthcare crisis, it’s probably wrong to question whether the public sector is doing all it can – but is it?

Is it systemically ready to do things without mistakes – to do them at the lowest cost?

It’s pretty unlikely, if only because you have a system full of highly paid, very experienced people who have spent their careers working in a system that is complex and almost certainly full of problems.

There is probably very little they can do to change things – and while they might do the best job they can – it’s probably not that different to what they were doing a decade or so ago.

It does seem that tech by itself or people by themselves don’t really add much value.

But, I also learned recently, the combination of tech and human might actually be surprisingly effective.

In my experience most people struggle with the technology they have to use.

It’s not their friend.

The example I was given was how an AI program and a doctor are much more effective working together at diagnosis than either working alone.

But if you use a computer then you’re in a similar situation – do you rail at the software you have or do you enjoy working on your computer?

People who have to use proprietary programs probably have very different views to those who use a free system like GNU/Linux.

I certainly do.

If I had to write these posts using the WordPress tools or anything from Microsoft then I probably wouldn’t create anything.

I suppose the point I’m making is this.

It’s tempting to think that because your technology cuts costs or because you work really hard that you’re adding value and are a winner.

But there are too many businesses and too many jobs that are failing the employee and the market.

The goal is to do something that challenges you – something you enjoy.

And you win if someone is willing to pay you to do it.

And that’s enough for me.

Cheers,

Karthik Suresh

Sunday, 7.37pm

Sheffield, U.K.

Hell, there are no rules here – we’re trying to accomplish something. – Thomas A. Edison

I’ve started seeing more threads on Twitter these days and they’re making me think.

A typical thread has twenty or thirty points.

Some are effectively essays as the points build on and reinforce arguments the writer is making.

Others are nuggets of information, packaged together and delivered – held together by the thread.

And then you have lists – 25 of these and 30 of that.

One of these, for example, had to do with 25 facilitation methods – the kinds of things you might do to run meetings.

Now, when you look at a group of things like that what’s missing is really how you would use them in practice.

For example, if you were a Roman soldier, you would have a set of kit – a throwing spear, a thrusting spear, a short sword, a shield – and you’d use each of these in combat at the right point.

You’d be far more effective as a soldier if you knew how to use that set of kit than if you walked around carrying a whole lot of stuff pulled together at random.

So, I thought, if I were to describe how I currently think about the way in which sales works for me what would that look like?

My focus is usually on complex sales – the kind of thing where customers don’t quite know what they need yet and need to work through that before they are ready to buy.

It’s the opposite of transactional sales where the customer knows exactly what they want and the main thing they want to do is figure out who is offering the best deal.

A complex sale means that you need to understand a complex situation – one where there is a lot going on.

If you do this properly what you will end up doing is understanding what value means in customer terms – you’ll be able to define value in words the customer would have used.

But get to this point you have to do a few things first.

You have to start by studying the situation – building a picture of what is going on through interviews and going to where the work is done.

You’ll have to see what’s going on – trying to listen to the voice of the process.

For example, if you are working with an organisation that fixes things, then value probably has something to do with getting things fixed when the customer wants them fixed – and the measure that tells you what is going in is the number of days it takes for a fix to get done – which is the voice of the process.

Now, as you listen to people you’ll start to build a picture of how they see the world and when you put this down as a model it’s called a holon – a construct that describes their particular perspective.

These three things – listening to people, trying to look at things from their point of view and taking the trouble to look at measures that let you see what is going on helps you gain an understanding of the situation.

Once you have that you can start to shape an intervention – perhaps come up with a flowchart of how to do things differently.

And to explain to others why this process works you’ll come up with stories, with presentations that seek to explain and persuade.

But because your stories are founded on a deep understanding of the situation, you’ll be able to get people to listen more closely and focus on your points rather than trying to find holes in your argument.

I find that these tools are the ones I use most of the time in my process – and what they help me do is follow the platinum rule.

The golden rule, as you are aware, is to do to others the way you would have them do unto you.

The platinum rule says do unto others as they would have you do unto them.

Now, when I think about this approach – one that works for me – I don’t see it as an unconnected set of tools or tactics.

I see them as part of a systemic approach, one where the elements work together to create a better customer development process that is focused on understanding what value looks like before trying to deliver it.

And it seems to me that however you do your process it cannot but help if you give your customer the value that they want and need.

Cheers,

Karthik Suresh

Saturday, 8.43pm

Sheffield, U.K.

If I have seen further than others, it is by standing upon the shoulders of giants. – Isaac Newton

For many Saturdays now I have taken a walk, doing a round of the charity shops close to me, accompanied by a small person and we both look for books.

Today, I stood and gazed at a shelf of books and wondered what I thought about them.

There was a selection of marketing textbooks – like a student had just dropped off four year’s worth of material.

A year ago I would have convinced myself to get pretty much everything on the shelf but today I was unconvinced – turning more to the children’s sections and books on drawing and doodling.

The reason for this, I think, is that I’m finding that theories about marketing and management are actually of very little use in day to day marketing and management.

Let me explain.

Isaac Newton’s saying that starts this post is one we all know – and clearly we have to learn from the lessons of the past if we are to avoid repeating them and if we want to build on them.

This approach works very well in the physical sciences – you don’t want to be in a position where you never learn that the earth is not flat, or the things that now are the basis of modern medicine.

But the same approach seems to run into problems when we approach the world of human society.

Science is very good at breaking down things and understanding the parts.

In doing that we come up with theories of why things are the way they are – and we use those theories to predict what else might be.

And science is so good at that it now seems that that way of thinking should be the basis of everything we do.

In marketing an early application of this way of thinking was Claude Hopkin’s famous book which was called, after all, “Scientific advertising”.

Anyone who wants to claim that their method works tries to use science – even if the scientific method has to be tortured a bit to make it seem like its producing valid results.

So you have a science of surveys and response analysis and statistics – all of which are used to come up with insights and theories such as those in the best-selling “Influence: The psychology of persuasion” by Robert Cialdini.

So, if you’re creating a new product or trying to connect with a market or sell something to a prospect – it makes sense to go out and pick up some books – the kind of books that I was looking at on that shelf perhaps.

But I’m realising that actually the scientific method is not everything – and it’s not really appropriate for everything that we do.

And actually, if we go back to before the scientific method there are ways of working we should not forget.

The first has to do with technology.

Technology is something that actually predates science – it comes before it.

We made tools and pottery and hot baths well before there was anything like a science of metals or minerals or state transition.

Nowadays technology is often based on scientific discoveries – which is why it might seem like it’s something that comes after.

But technology is fundamentally about tools used by people – and tools like the Internet and online commerce are really only a decade or a couple of decades old for much of humanity.

For example, I had to try and fix a leaking tap today – and constructing a new kitchen wasn’t really something that was a feasible option – even if it will happen in the long-term.

The tap is old, however.

But Ebay had one of the valves that I needed – and it’s on its way to me now.

And a YouTube video told me how to take the tap apart and how to search Ebay in the right way to find what I needed.

That’s technology to the rescue, not science.

Now, when you’re creating marketing for technology it seems to me that science will just get in the way.

That whole standing on the shoulders of giants things keeps you a little too far away from what matters.

What matters is what’s happening on the ground.

The people who succeed in online commerce are the ones who best understand what value looks like from the point of view of the customer.

The people who created a video that explained what I needed to do and the people who created an Ebay page where I could measure and check that what I was buying was what I needed were able to create the conditions where they delivered value and I paid a price.

And I don’t think that stack of books would have helped any of the people in that transaction do things better.

It might have even gotten in the way.

The more I think about this the more I am convinced that starting from the reality on the ground is the way when you’re trying to improve the way in which you carry out management or do marketing.

It’s coming up with approaches and strategies and tactics that are rooted in a clear understanding of the people you’re trying to serve and what value looks like from their point of view.

It’s grounded theory.

Which means, you have to get off those shoulders and get on the ground if you want to succeed here.

Which brings us to the second method.

Talk to your customers, listen to them and give them what they need.

And it might just be as simple as that.

Cheers,

Karthik Suresh