Excelling at Customer Service

Customer services

Customer services (Photo credit: gordon2208)

“Excellence is not a skill. It is an attitude.”

Ralph Marston (1907 –  ) Professional Football Player in 1929

“If you want to give a great customer experience you have to align your culture and the way you reward staff. None of our customer facing staff has sales targets or sales bonuses — their rewards and bonuses are based purely on their customer satisfaction scores.”

Anthony Thomson, Chairman, Metro Bank

Quote courtesy of Institute of customer service

Life has a way of taking everything in its stride and I am often compelled to go through the related emotions. Sometimes, I marvel at the way life turns corners and obviously as human beings, we all have this uncanny ability to learn from mistakes and move on by not repeating those same mistakes. We learn, change and adapt.

Organisations are very similar to us (in theory) and are supposed to learn from their mistakes, change processes to reflect that and become ‘the ideal organisation.’ So, I have to ask myself then, ‘Why in today’s day and age, are we still dealing with organisations’ that are failing its customers, in terms of customer service?’

Obviously, during my life, I have had many good experiences of customer services and some pretty dire ones. The reason for writing this blog is that recently, I dealt with three organisations that should have excelled at customer service but in reality, they failed in their promise to provide even the basic levels of customer service. I have debated whether to play the ‘name and shame’ game but that just wouldn’t be me. So, instead, I have decided to write about how to provide excellent customer service.

According to a survey conducted in the U.S. and eleven other countries in 2010, by American Express Global Customer Service Barometer, Americans Will Spend 9% More with Companies That Provide Excellent Service

Although only a little more than a third of Americans (37%) believe that companies have increased their focus on providing quality service:

  • 27% feel businesses have not changed their attitude toward customer service.
  • 28% say that companies are now paying less attention to good service.

So, where do I start?

Let’s start with:

  1. Culture

According to Catherine Lovering, “Make the goal of providing excellent customer service a company-wide commitment. Put a customer-service policy in writing, and post it in a prominent place. Translate customer-service objectives into specific actions for employees to follow, such as: deliver prompt service, offer a polite demeanour, and make product information readily available.”

Inc.com says, “Start by hanging on the wall a set of core values, 10 or fewer principles that include customer service ideals, suggests Susan McCartney, Maggiotto’s colleague at the Buffalo SBDC. “Share them during the training, have employees sign them, and evaluate employees based on the values,” she says. “But don’t call them rules.”

Employee training on customer service precepts should be intensive: written materials, verbal instruction, mentors, and on-the-job demonstrations all ought to be part of the coursework, says McCartney.”

This theme continues in 10 Examples of Shockingly-Excellent Customer Service and  12 ways to dazzle your customers.

  1. Staff morale and motivation

Catherine Lovering says, “Treat your employees well, so they in turn will treat customers well. Employees will bring enthusiasm and a positive attitude to their job when they know they’re appreciated and respected. Recognize employees who continually provide good customer service and praise the entire staff for their efforts. Customer-service work can be emotionally draining unless the company involved is supportive and gains the loyalty of its employees.”

Inc.com says, “Companies renowned for their customer service — the online shoe retailer Zappos, for example — treat employees as they would have their employees treat their customers. “Employees take on more responsibility because they know they are appreciated and an important part of the team,” says the University of Missouri’s Proffer. “People who don’t feel like they’re part of the bigger picture, who feel like a small cog in a big machine, are not willing to go the extra mile.”

Not every business can afford to shower staff with generous pay and benefits, but not every business has to. Small companies, says McCartney, can show “intense interest” in employees, in their welfare, their families, and their future — what McCartney calls the family model. It’s also important to recognize an employee — publicly — for a job well done. Some companies also offer incentives for exceptional customer service, but if you can’t spare the cash, you might throw an office party or offer another token of appreciation. When he was a manager at cable provider Tele-Communications Inc., for instance, Proffer personally washed the cars of notable employees.”

  1. Knowledgeable staff

Staff need to know their products and services and that can only be achieved by a comprehensive induction and training programme for staff that not only includes products and services but also includes an initiation with an organisation’s processes and knowledge of the internal and external network of people who can help resolve issues and problems. A ‘can do attitude’ needs to be instilled in staff right at the outset while empowering customer service staff to engage in activities that resolve the problem while highlighting to management any processes that hinder resolution. That way employees are highlighting processes that hinder the delivery of excellent customer service while improving customer service delivery at the same time.

Inc.com says, “The best salespeople spend 80 percent of their time listening, not talking,” says Marc Willson, a retail and restaurant consultant for the Virginia SBDC network. Ask open-ended questions to elicit a customer’s needs and wants. ”

Further in the article, Proffer offers the The Five A’s. method, “It’s helpful to think of resolving a dispute as a five-step process called the Five A’s: Acknowledge the problem. Apologize, even if you think you’re right. Accept responsibility. Adjust the situation with a negotiation to fix the problem. Assure the customer that you will follow through.”

  1. Well trained staff

Training is paramount and well trained staff needs to help customers resolve their problems regardless of how much time they have spent resolving it (within reason). Many organisations tend to operate their measuring metrics for customer services advisors’ on calls closed rather than calls resolved. Well trained staff will have the ability to resolve calls and close them better than ill trained staff. Staff training should be reviewed periodically and refresher courses offered based around lessons learnt, processes improved and latest innovations in delivering better customer service.

Catherine Lovering in her article on customer service said, “Teach the staff stress-reduction methods and techniques in conflict resolution. Train staff to use language that promotes good customer service. Phrases such as “How can I help,” “I don’t know, but I will find out,” and “I will keep you updated” let customers know that their needs will be met. It also will demonstrate a willingness to find a solution to any problem and a commitment to communicate with the customer. This dedication will go a long way toward defusing dissatisfaction among clientele.”

She further adds, “Train staff to accept responsibility for errors and to apologize to upset customers. Good customer-service representatives must refrain from arguing with an upset customer and instead ask the customer what they can do to solve the problem. Advise employees to speak calmly to customers and to assure them that they’ll do what they can to help. Follow up with a clear resolution to the complaint.”

  1. Empowered staff

Catherine Lovering says, “Empower these staff members to not only deal well with upset customers on an emotional level but also to provide tangible benefits. For example, “Entrepreneur” magazine recommends giving employees the authority to give any dissatisfied customer a 10-percent discount.”

The emphasis should be on, “What can we do that will make the situation better for you? Add the wow factorFor example, one winner of The WOW! Awards is a restaurant in Leeds called Gueller’s. They keep a range of prescription spectacles, just in case customers forget their own and are having difficulty reading the menu.”

Give them something that will make them feel valuable. That could be a freebie, the ability to resolve their problem, following up the matter on their behalf and make them feel that their concerns have been heard and addressed (or will be addressed)

  1. Customer service, IT systems and process review – Capture, monitor and report

IT systems need to be setup according to effective measurement metrics. For example, it is not good enough to measure “How many calls did an agent take/close today?” An effective metric would be, “How many calls did an agent close today that was satisfactorily resolved for the customer?” Each call should also be followed up by the completion of customer satisfaction surveys and that opportunity utilised for creating other effective metrics and for highlighting process improvements.

Information Technology Infrastructure Library (ITIL) is used extensively within the IT industry and it can be modified to deliver excellent customer service. Karen Francis of Macanta consulting says, “My opinion is that we shouldn’t be too precious about what we use as long as it works for us. If an organisation is already using ITIL for the IT department and finds that it can be adapted for the non-IT departments, then why not do it.

ITIL may not cover things such as sales and marketing and HR, but if you already have effective and efficient processes for managing faults, problems, changes, inventory, capacity, business continuity, service levels and so on, why not use them for non-IT if they translate well?”

As a fan of Deming, I would like to add Danielle J Baker’s thoughts, “ITIL’s iterative approach and focus on continuous improvement is the basis of IT Service Management as defined by the ITIL set of best practices.

The following needs to be done prior to the installation of any IT system for customer service.

  1. Do we know what processes we have captured in existing systems?
  2. How do we go about capturing processes that are not captured by our existing systems?
  3. What processes can we improve, prior to using IT?

Use new innovative tools for interacting with customers, such as Desk.com (Or similar tool). According to Desk.com website, “Connect to your customers on Facebook and Twitter as easily as on traditional support channels like email, phone and web. Desk.com organizes all of your support in one place so you can respond efficiently wherever your customers reach out.”

One of their client’s, Bonobos said, “I was excited by the look and feel of Desk.com when I saw it. By lunchtime the next day we had switched over entirely.”

  1. Benchmark

As a big fan of benchmarking, I highly recommend benchmarking and covered this in my blog post, IT benchmarking

Catherine Lovering said, “Create customer service benchmarks for employees to meet, and reward the workers who meet and exceed them.”

  1. Customer service and relationship management

Catherine Lovering said, “Communicate with customers so you know what they want. Distribute surveys, request feedback, and make it easy for customers to let you know how they feel about their shopping experience. Add a personal touch to customer communication by answering comment letters with a note of thanks. Keep an eye on the competition to see how they implement customer-service policies, especially if it appears that those services are well-received by customers.”

Inc.com says, “The cost of acquiring a new customer is five times that of retaining an existing one.”

Contact with the organisation should be easy and should include an element of ‘self service’ via social media and an organisation’s own website. That could include, for example, a knowledge base or frequently asked questions (FAQ). This could be done by keeping track of the most common type of service desk requests and enabling access to them via these methods.

In her excellent article, 4 Steps to Overcome Being a Pain in the Ass Call Center that I would recommend reading (All 3 parts), Dr. Jodie Monger says, “According to W. Edwards Deming, the father of the quality evolution, “workforces are only responsible for 15% of mistakes, where the system desired by management is responsible for 85% of the unintended consequences. [1]”  In other words, 85% of a worker’s effectiveness is entirely out of his or her control!   It’s rather unfortunate that it is the 15% that is under workers’ control that call centers tend to focus on through quality monitoring efforts, Voice of the Customer programs, mystery shopping and the like.

A well-designed, well-executed quality program will provide a holistic view of your organization’s strengths and opportunities by answering ALL four of the vital questions:

  1. How are we—as an organization—doing at representing our company to its customers?
  2. What can we—as an organization—do to improve?
  3. How are you—as an individual agent—doing at representing our company to its customers?
  4. What can we—as a management team—do to help you improve?

Note that in accordance with Deming’s philosophy of systems and process management, only one of the four vital questions focuses on the activities of the worker.

What would your answers be?”

On that thought provoking question by Dr Judie Monger, I would like to end this blog and hope that this blog post contributes to even better customer service!

References and further Information:

10 Examples of Shockingly-Excellent Customer Service

12 ways to dazzle your customers

Why is Customer Service Still So Lousy?

Customer service frustration leads to lawsuit

Americans Will Spend 9% More With Companies That Provide Excellent Service

The high price of bad customer service

American Express – A story of customer service gone bad

Create a culture of excellent customer service

Institute of customer service

7 Secrets to Providing Excellent Customer Service

Providing Excellent Customer Service

Tips for excellent customer service

How to provide excellent customer service

How to deliver great customer service

How to provide excellent customer service

Salesforce.com Revolutionizes Customer Service for a Social and Mobile World with Desk.com

desk.com

Using ITIL for Non-IT Purposes

How ITIL Help Desk can help SMBs?

ITIL and Deming

Are you a Pain in the Ass Call Centre?

The Deming Centre for Quality, Productivity, and Competitiveness at Columbia Business School

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CIOs and the ideal management style

Chief Information Officer United States Army logo

Image via Wikipedia

“Great things are not done by impulse, but by a series of small things brought together.”

Vincent van Gogh (1853-1890) Dutch painter

Today’s article is the seventh in a series of articles (1st Steve Jobs, 2nd Michael Dell, 3rd Warren Buffet, 4th Bill Gates, 5th Larry Ellison, 6th Eric Schmidt), analysing current and past leaders to ascertain how Chief Information Officer’s (CIOs) can learn better management by applying the management practices of leadership, practiced by these leaders.

These blogposts have been informational for me and my readers and I have certainly learnt a lot from all the different management styles of these ‘new age’ leaders. It was fascinating to read that while they all had common aspects, they were also very different indeed.

As a result of these blogposts, books that I read, academic and vocational qualifications and my own experience, I decided to outline my thoughts on the qualities that are needed to become a successful CIO.

1. The start of a CIO’s career within a new organisation:

There is a general assumption within IT that a CIO’s career starts once the interview process is over. This is one of the worst assumptions to be made by a prospective CIO. The aspiring CIO needs to understand the prospective organisation that he/she wants to work with and ensure that it is a good fit for his/hers skills and that the ‘culture’ of the organisation supports change and is quite open to ‘challenging the status quo.’ I would suggest that the CIO has done his/her research on the organisation prior to the interview to establish that it is an organisation that they want to work with and assist to achieve the business benefits that the organisation perceives will be achieved once the CIO joins. The CIO MUST ask the right questions at the interview and ensure that there is indeed a ‘strategic fit’ for both the CIO and the employing organisation.

Read the job specification well and look for indicators that may lead to problems or that highlight that ‘strategic fit.’ Try and define (fine tune) the role to establish, for example, How will IT success be defined and measured?

2. The job begins:

As soon as you join/start an organisation as a CIO, make a list of strengths and weaknesses of yourself and your organisation on a piece of paper as that will enable you to plan effectively and to ‘hit’ the problem areas first. Go into the job well prepared, as by that stage, you had ample opportunity to look at the job specification, research the organisation and the interview gave you ‘key’ information to utilise. Start building your credibility by establishing some areas for ‘quick wins’ and be careful to strike a fine balance between ‘moving too fast or slow.’ For example, trying to impress your boss by moving too quickly to make something happen that results in an awkward explanation to him/her has to be avoided at all cost. Take decisive action, as moving slow can also adversely affect your credibility.

3. Communication and establishing relationships:

Listen, learn and communicate. As soon as you are comfortable, conduct a business/IT review. I am not going to give this consideration as a separate bullet point because I believe that it has to be done by establishing relationships. These relationships will be ‘key in analysing the business and IT and will provide the information that the CIO seeks. This communication and relationship building cycle has to take precedent as the CIO casts a wide ‘networking’ net across the organisation. Talk to senior executives’, gatekeepers, junior staff and all the people who use IT to do their everyday jobs. These are the people who will inform you where IT is delivering value, where business fails and how to strike the right balance.

Conduct ‘one to one’ interviews, inform people within your organisation your goals and communicate to your team your leadership style. Be honest and transparent with people as everyone hates the ‘new smart ass guy/gal.’

4. Lead and innovate:

Always follow your instincts and look for ideas to nurture. Encourage innovation and ask your team to set aside at least 10-20% of their time for projects that they want to do (during business hours). Google and 3M have done this very successfully and if they can do it, so can you. Look for opportunities while constantly analysing every aspect of IT and your team, looking for improvements.

Be visionary and ensure that you present a vision to your team that is representative of where the business wants to be or is heading towards. Create a culture of change and nurture the ‘right’ talent within your team and if hiring externally ensure that ‘action oriented employees’ are selected.

Finally, ensure appropriate metrics and scorecards are used to chart your progress (key success factors and key performance indicators) from just ‘keeping the lights on’ to actually ‘driving business transformation.’

———————————————————————————————————————————————

Related Information:

Who is a CIO?

A CIO is a leader who has an excellent overview of IT, business and how people interact with each other. He can then apply that knowledge to understand where a business is going (Business Vision) and ensure that IT systems and procedures are developed to realise that vision and along the way, if he/she can realise financial savings/contribute to the bottom line (actually utilise IT to earn revenue), he/she become indispensable and should head for stardom. For example, Tesco’s Ex IT Director became their CEO – http://www.thisismoney.co.uk/news/article.html?in_article_id=505864&in_page_id=2

Why hire a CIO?

To ensure that the above actually happens and that the IT systems are actually working towards creating value for the business and are delivering the business vision with assistance from the IT systems.

Why a CIO is important in an organisation?

A CIO is important as without a board level director (CIO), IT manager’s cannot represent IT effectively to the business. Read my blogpost: Leveraging IT for Competitive Advantage – Myth or Reality? – http://wp.me/pw27T-4S

Roles and Responsibilities of a CIO

Deliver the business vision
Create the ‘buy in’ from internal and external relationships to deliver that vision
Develop effective and reliable IT systems to deliver that vision
Empower IT teams to make good decisions
Effective and brilliant leadership

Criteria for Becoming a CIO

Leadership skills, inspirational capability, tenacity, ability to make good educated calculations of where both business and IT are heading towards (especially the IT capability, for example, In House systems vs. Cloud), Excellent networker and people person, team player and good communication skills, especially the ability ‘to listen.’

For More Info:

Master of Information Leadership (MIL) for aspiring CIOs delivered by City University, London

First 100 Days as CIO

Top 10 guidance tips for new CIOs and IT leaders

London School of Business puts whole MBA course on Facebook

Eric Schmidt (Ex CEO and current Chairman – Google) management style and CIO

Image representing Eric Schmidt as depicted in...

Image via CrunchBase

“If you’re not making mistakes, then you’re not doing anything.”

John Wooden (1910 – 2010) Hall of Fame basketball coach of UCLA

Eric Schmidt (1955 – ) Google CEO and Chairman from 4th April 2011 onwards

Today’s article is the sixth in a series of articles (1st Steve Jobs, 2nd Michael Dell, 3rd Warren Buffet, 4th Bill Gates, 5th Larry Ellison), analysing current and past leaders to ascertain how Chief Information Officer’s (CIOs) can learn better management by applying the management practices of leadership, practiced by these leaders.

This article also follows my previous articles on Google, Microsoft Googles Apple in 2011, Google Apps – The myth, hype and reality, Weather bulletin – Google Cloud and icy Microsoft downpour and Used iphone under a palm tree where I met android and formed a symbian relationship with a blackberry

Eric Schmidt arrived at Google to help Google’s inexperienced founders; Sergey Brin and Larry Page. He has led Google to become a globally recognised company with approx 24000 employees. Recently, he has stepped down to become the chairman and to pass the leadership to Larry Page (on 4th April 2011). Over the years, he has mentored the young founders and believes that the time is now right for them to take the helm. For his efforts, he leaves with a golden shake of $100 million in equity and shares worth 9.1% of Google stock.

“As a CEO, Schmidt is more inclined to provoke than proclaim. “Google is run by its culture and not by me”, said Schmidt in 2009. In Google, when a key executive decision is reached, all interested parties are invited to the decision making process and are encouraged to share their opinions. Schmidt’s job is to oversee the whole procedure and make timely decisions. This bottoms-up way of decision making usually leads to a better buy in and a better decision.  Google allows employees to spend 20% of time on self-directed projects. To closely connect to Google’s frontline innovators, each week Schmidt and his senior associates spend up to six hours in dialogue with team members from across Google, who believe their projects have great potential. This unique management style has hatched a series of great products like Gmail and Google News.” Courtesy Vivian’s Tech Blog

PS: CIO is a generic term and other analogous titles are Head of IT, IT Director, Director of IT etc.

The Management Style

What can CIOs learn from Eric Schmidt’s management style? Let’s investigate while allowing you to decide.  (In no particular order and a few other sources utilised):

1. How do you run this company? – ES “It’s run in a strange way. We have a normal hierarchical structure. The company is organized ‘bottoms up’ from the standpoint of product creativity and ‘tops down’ from running the quarter and the financials and so forth. We encourage dissent, we encourage large group conversation, we encourage there to be somebody who’s opposed to the decision, and we work very, very hard to be not hierarchical in the way that decisions are made. Often if we can get a decision, we get the best decision if we have two decision makers, not once. We never make decisions in private; we always do them right in front of everybody.” Courtesy Marketplace

2. When the going gets tough, investment in people always pays: ES – “Getting the most out of knowledge workers will be the key to business success for the next quarter century. Here’s how we do it at Google.

At Google, we think business guru Peter Drucker well understood how to manage the new breed of “knowledge workers.” After all, Drucker invented the term in 1959. He says knowledge workers believe they are paid to be effective, not to work 9 to 5, and that smart businesses will “strip away everything that gets in their knowledge workers’ way.” Those that succeed will attract the best performers, securing “the single biggest factor for competitive advantage in the next 25 years.

At Google, we seek that advantage. The ongoing debate about whether big corporations are mismanaging knowledge workers is one we take very seriously, because those who don’t get it right will be gone. We’ve drawn on good ideas we’ve seen elsewhere and come up with a few of our own. What follows are ten key principles we use to make knowledge workers most effective. As in most technology companies, many of our employees are engineers, so we will focus on that particular group, but many of the policies apply to all sorts of knowledge workers.” – Courtesy 1000 Ventures

For more, read – Google’s ten golden rules for getting the most out of knowledge workers.

When Eric joined Novell, the company’s future was very much in doubt. He correctly recognized a culture of fear that pervaded the organization. Bright engineers with revolutionary ideas were reluctant to voice them for fear of being fired. The engineers however, complained vociferously amongst themselves leading to a culture of corporate cynicism. Recognizing this pervasive bellyaching, Eric asked two engineers he met on the company shuttle, to give him the names of the smartest
people they knew in the company. Eric met with each of them, and asked them in turn to identify the 10 smartest people they knew. In a few weeks, Eric had a list of 100 engineers he considered critical to Novell’s future. He met with each of them personally, encouraging them to take chances and follow their instincts. He removed the possibility of reprisals by their managers for voicing their opinions. This inspired the engineers and focused their efforts, resulting in innovative and improved products. These changes helped Novell transform itself from a loss of $78
million to a gain of $102 million”. – Courtesy Scribd.com

One person alone cannot handle everything. The secret is to surround yourself with employees that are smarter than yourself. These smart people will challenge organisations and force them to think differently. I covered this, under mobility of management when I covered; can IT Management failure be caused by a deadly disease? Part II. CIOs need to understand the importance of retaining and investing in people as one of the business’s most important assets is yet again confirmed by another business leader.

3. Business/IT Strategy: “At Google, Eric has stated the company’s goal as “…Organizing the world’s information making it universally accessible and useful”. An engineer working to index billions of web pages can easily identify with this laudable goal. As a practical matter the goal of making information universally accessible is a more
meaningful goal for the engineer, interested in making his mark on society, rather than a mundane goal of increasing Google’s revenues by $300 million dollars. Eric considers this transfer of ownership to be so important that while at Novell he created a quarterly in-house radio show modeled after NPR’s “Car Talk”. He even made tapes available for in-car listening.” – Courtesy Scribd.com

Sometimes it’s best to follow your instincts and to believe in yourself to do the right thing. Paralysis by analysis is often the cause that many organisations cannot do well. It’s as Nike says, Just do it!

4. Rating of employees’ performance: – In the past, I have reviewed many CEO’s management style but Eric Schmidt’s style is the closest fit to Deming’s ‘Annual rate of performance’ that I have yet come across.

“Eric management style is to let the team’s progress be reviewed by individuals the team respects. In most companies there exist a few individuals that are universally respected or at least more respected than everyone else.
These individuals have a way of articulating principles and have very good memories. Since they are considered impartial, teams are more open to receive feedback or decisions even if the decision goes against them. – Courtesy Scribd.com

5. Earn respect by ‘listening’: – ES “Listening to each other is core to our culture, and we don’t listen to each other just because we’re all so smart. We listen because everyone has good ideas, and because it’s a great way to show respect. And any company, at any point in its history, can start listening more.” Courtesy Andrew McAfee

6. Competitive advantage: This is an area of great interest, as currently, Google is the undisputed king of search but Microsoft’sa Bing is knocking on its doors. So, for the moment Google is able to keep its competitive advantage. The worry for Google has been the defection of key employees (who view Facebook as ‘cool and the place to be’) to companies such as Facebook. Social Media is an area where Google doesn’t really have a strong foothold and that is worrying for them while in the mobile arena, Android is not a huge money earner (albeit, earnings are approx $6 per user per year) when compared to Apple IOS. Google is in a battle with Apple, Microsoft and Facebook and it is ambiguous which markets Google ultimately wants to compete within.

CIOs need to ask themselves how they can help the business through leveraging IT to create competitive advantage. I covered this in my post, Leveraging IT for Competitive Advantage – Myth or Reality?

7. Talent acquisition – Hire ‘Action’ oriented employees: “I might have been mistaken, actually. Having your name and picture up on that big screen at End of Quarter may not be the biggest incentive. The thing that drives the right behavior at Google, more than anything else, more than all the other things combined, is gratitude. You can’t help but want to do your absolute best for Google; you feel like you owe it to them for taking such incredibly good care of you.” Source unknown, courtesy Oliver Thylmann

Google actively recruits recent Ph.D.’s and Ph.D. candidates. All 1,900 Google employees are researchers and developers in addition to their regular duties. Where other companies will keep their research departments and core businesses separate, Google places all their Ph.D.’s in the rank and file of the company. Workers at Google enjoy a company devoted to benefits (Stross, 2004). They also enjoy an informal company culture where employees have access to gyms, massages, pool and ping-pong tables, well stocked snack rooms and other recreational amenities (Google Culture, 2009). Courtesy Marty Andrade

A CIO needs to trust their gut instinct, as one can only learn a certain amount in an interview. I think, the strategic fit, is a very good measure. How will a new hire fit into the culture of the company? Will they enjoy it here? Have they worked in a similar culture before? The danger is that the culture could be so alien to the new hire, that they find it difficult to adjust.

Eric Schmidt has hired the smartest people who can ‘get the job done.’ Hire your friends and past colleagues, as they will have loyalty to you and as you know them personally, an informed decision can be made on whether they have what it takes to realise your ‘vision.’

8. Spotting opportunities and innovation: LE –  “innovation is the key to Google’s success, everything Schmidt does revolves around creating more innovation. Without it, Schmidt believes there is nothing to prevent another company from overtaking Google as the king of digital information.  Innovation is systematically encouraged at Google at all levels throughout the organization, including management. At Google, management follows the “70/20/10″ rule where seventy percent of their time is spent on core business projects, twenty percent is spent on projects related to the core business and ten percent is spent on projects unrelated to the core business (Battelle, 2005). Schmidt, in order to remain true to the 70/20/10 rule, actually divides these projects into different rooms and tracks his time spent in each of the rooms.” Courtesy Marty Andrade

For More Info:

The Daily Telegraph’s articles on Eric Schmidt

Google’s greatest innovation may be its management practice

Android OS is profitable, might generate $10 billion per year

Google CEO, Eric Schmidt: “We don’t have a 5 year plan.”

The New York Times: Eric E Schmidt

Google CEO, Eric Schmidt, will not talk about “Private conversations” with Apple about becoming CEO

Warren Buffet’s (World’s most successful investor) management style and CIOs

Warren Buffett speaking to a group of students...

Image via Wikipedia

“You are neither right nor wrong because the crowd disagrees with you. You are right because your data and reasoning are right.”

Warren Buffet (1930 – ) World’s most successful investor

Today’s article is the third in a series of articles (First was written on Steve Job’s – Apple CIO followed by Michael Dell (CEO Dell) analysing current and past leaders to ascertain how Chief Information Officer’s (CIOs) can learn better management by applying the management practices of leadership, practiced by these leaders.

PS: CIO is a generic term and other analogous titles are Head of IT, IT Director, Director of IT etc.

The Management Style

Warren Buffet is one of the world’s richest men and a very successful investor.  For today’s blog post I have selected a truly unique individual. He works from his office that lacks a computer and surprisingly his desk is bereft of research on stocks and shares.

Before we go any further, one particular event caught my attention that captures a facet of Warren Buffet’s management style. So, I have decided to share it with everyone. According to BusinessWeek, ‘We arrive late to Paris, touching down in a freakish, near-gale-force windstorm that both thrills and alarms our pilot. In four cars, we race as fast as rush-hour Paris traffic allows from Le Bourget to Dassault Aviation Group’s magnificent 19th century chateau–familiarly known as Le Rond Point–on the Champs Elysees. EJA is the largest commercial customer of Dassault Aviation, Europe’s leading manufacturer of business jets. Serge Dassault, the company’s chairman, is hosting tonight’s gala reception and dinner in Buffett’s honor. By the time we arrive, the reception is in full swing. But Buffett takes a few steps into the foyer and hustles up a flight of stairs. It will be a good 35 minutes until he descends and joins the party.

Downstairs, the guest of honor’s whereabouts is Topic A among Dassault’s distinguished guests. It might puzzle them to learn that Buffett is on a transatlantic call to one of his employees. The matter he is discussing with Ajit Jain this evening is not urgent. But it is Buffett’s custom to speak with Jain every evening. If that means keeping 200 of France’s richest people waiting, then c’est la vie.’

What can CIOs learn from Warren Buffet’s management style? Let’s investigate while allowing you to decide.  (In no particular order and a few other sources utilised):

1. Business assessment: When looking to invest, Warren Buffet looks to satisfy ‘five’ essential criteria, equally CIOs can apply similar criteria when looking to invest their expertise towards business assessment. Buffet – ‘Never invest in a business you cannot understand.’

Warren Buffet investment criteria CIO ‘business’ assessment criteria
1 Is the company simple and understandable? Is the business model, simple and understandable?
2 Does it have a consistent operating history? Has IT consistently assisted the growth or well being of the company?
3 Does it have favourable, and predictable, long- term prospects? Is IT viewed favourably within the company and can IT predict how it can help the company’s long-term prospects?
4 Is the management competent and honest? Is the IT management team competent and aligned to the business vision?
5 Is the underlying business undervalued? Is IT undervalued? How can IT deliver ‘more’ value from existing resources?

2. Ownership: In the 2010 Berkshire Hathaway (BRKA) annual report, Buffett wrote of his holding company: “We tend to let our many subsidiaries operate on their own, without our supervising and monitoring them to any degree. Most managers use the independence we grant them magnificently, by maintaining an owner-oriented attitude.” Buffett wants Berkshire Hathway’s managers to think like owners. Their rewards are tied exclusively to the achievements of their own businesses, not those of Berkshire Hathaway – a principle to which Buffett holds very strongly. “We delegate to the point of abdication,” Buffett says in Berkshire’s Owner’s Manual. CIOs need to instil their teams with similar beliefs. Every individual within the CIOs team needs to think as if they were the ‘owner’s’ of the business, especially the CIOs main management team.

3. Risk assessment and crisis management: Buffet – ‘If there is any significant bad news, let me know early’. The team need to have confidence in the CIO, in order that ‘bad news’ events/issues/problems can be resolved prior to them mothballing to the ‘point of no return.’ ‘An investor needs to do very few things right as long as he or she avoids big mistakes.’

4. Succession: Buffet – ‘send me a letter updating your recommendations as to who should take over tomorrow if you became incapacitated tonight. Anything you send me will be confidential’. CIOs need to have succession planning in order that the business has continuity in the unfortunate event of a CIO not being able to provide management.

5. Business reputation: Buffet – ‘Look at the business you run as if it were the only asset of your family, one that must be operated for the next 50 years and can never be sold’. He adds that ‘We can afford to lose money – even a lot of money. We cannot afford to lose reputation – even a shred of reputation.’ CIOs need to understand that IT systems can enhance and taint a company’s reputation. The recent BP oil spill crisis reflects that as it had a devastating effect on BP’s reputation, wiped millions off its share price, cost billions to settle claims and control the oil spill. Additionally, the irrecoverable loss of both human and marine life, coupled with the environmental damage leaves the oil giant in shambles.

6. Quality management: ”What I must understand is why someone will continue to get out of bed in the morning once they have all the money they could want,” Buffett says. ”Do they love the business, or do they love the money?” CIOs need to have a team that enjoys working within IT and associated line of business.

7. Competitive advantage: Warren Buffett was once asked what is the most important thing he looks for when evaluating a company to invest in. Without hesitation, he replied, “Sustainable competitive advantage.” CIOs need to ask themselves how they can help the business through leveraging IT to create competitive advantage? I covered this a few months ago, in my post, Leveraging IT for Competitive Advantage – Myth or Reality? Companies with a sustainable economic advantage need honest, capable and hardworking leaders to retain their lead. Berkshire-Hathaway’s managers have one instruction: Widen the moat. That keeps the castle valuable.

8. Use numbers to season the points you serve — they’re not the main dish: (Points 8,9,10,11 courtesy of the Harvard Business Review blog) Buffett doesn’t just report on the underwriting gains of their insurance businesses and let the numbers stand for themselves; he explains the terminology, what the numbers mean, and how he and Charlie Munger, his business partner, view them. Case in point: “Our $58.5 billion of insurance “float” — money that doesn’t belong to us but that we hold and invest for our own benefit — cost us less than zero. In fact, we were paid $2.8 billion to hold our float during 2008. Charlie and I find this enjoyable.”

9. Use analogies and metaphors. A great example is Buffett’s description of how many of us felt after the economic collapse in 2008: “By year end, investors of all stripes were bloodied and confused, much as if they were small birds that had strayed into a badminton game.” And he goes on to describe the government’s response: “In poker terms, the Treasury and the Fed have gone ‘all in.’ Economic medicine that was previously meted out by the cupful has recently been dispensed by the barrel.” These metaphors do more to explain his points than paragraphs of technical jargon ever could.

10. Be honest and transparent. Buffett follows-up a recap of 2008 successes with the following revelation: “During 2008 I did some dumb things in investments. I made at least one major mistake of commission and several lesser ones that also hurt. I will tell you more about these later. Furthermore, I made some errors of omission, sucking my thumb when new facts came in that should have caused me to re-examine my thinking and promptly take action.” Instead of deflating his credibility, this kind of refreshing candidness makes the audience more trusting of whatever else he might say: after all, he’s clearly not hiding anything. ‘It is more important to say “no” to an opportunity, than to say “yes”.’

11. Use facts to put things in realistic context. After explaining how bad the economic situation was in 2008, Buffett gave a fact-based context for how to view these realities. “Amid this bad news, however, never forget that our country has faced far worse travails in the past. In the 20th Century alone, we dealt with two great wars (one of which we initially appeared to be losing); a dozen or so panics and recessions; virulent inflation that led to a 21 1/2% prime rate in 1980; and the Great Depression of the 1930s, when unemployment ranged between 15% and 25% for many years. America has had no shortage of challenges. Without fail, however, we’ve overcome them. Compare the record of this period with the dozens of centuries during which humans secured only tiny gains, if any, in how they lived. Though the path has not been smooth, our economic system has worked extraordinarily well over time.”

12. Follow your instinct: Buffet – ‘Do not follow the crowd. Ignore the market, the crowd, and its fashions.’‘It is not necessary to do extraordinary things to get extraordinary results.’

13. Research: Buffet – ‘Do not rely on outside analysis. Do your own research – and do it thoroughly.’ Do not often act on a hunch. Always have sound, well-argued, well-researched reasons for your investments.’

14. Trustworthiness and integrity: Developing characteristics such as trustworthiness and integrity, Buffett believes, is a matter of forming the right habits. “The chains of habit are too light to be noticed until they are too heavy to be broken,” he says. People who stray from these values often show up on Wall Street; they may initially even shine; but eventually they self-destruct. “That is sad, because it does not need to happen,” says Buffett. “You need integrity, intelligence and energy to succeed. Integrity is totally a matter of choice — and it is habit-forming.”

15. Buy at the right price: Purchases must be made at the right price if they are to pay off.

No less an authority, John F. Welch, CEO of General Electric Co., considers Buffett a superb judge of managerial talent. Buffett and Welch have gotten to know each other over the years as golf partners and as rivals in auto insurance and other businesses. ”Take 20 people you know quite well but Warren has just met casually,” Welch says. ”If you ask Warren his opinion about them, he’ll have each one nailed. He’s a masterful evaluator of people, and that’s the biggest job there is in running a company.”

Asked why he has not retired despite his phenomenal wealth, Buffett said the reason is that he has more fun doing what he does than anything else. “The fundamental thing is that the process should be fun,” he said. “I had just as much fun when I had $10,000 to invest as I do now. It’s crazy to do things for your resume. It’s like saving up sex for your old age. You should do what you enjoy as you go along, and work with people you admire. I look forward every day to the next day. I’m wired for this game.”

For the long haul, Warren Buffett’s way must be best. As an associate says, ‘somehow Warren has been able to keep a diverse cast of characters working harder for him than they did for themselves. I see it every day – and I still don’t know how he does it’. Having read all the above, though, you will have a good idea of the maestro’s magic methods. Use them.

Benchmarking IT

‘It is not the strongest of the species that survives, nor the most intelligent, but the one that is most responsive to change.’ Charles Darwin

Benchmarking is the process of comparing one’s business processes and performance metrics to industry bests and/or best practices from other industries. Benchmarking involves management identifying the best firms in their industry, or any other industry where similar processes exist, and comparing the results and processes of those studied (the “targets”) to one’s own results and processes to learn how well the targets perform and, more importantly, how they do it.

I have been reading, The Real business of IT – How CIOs create and communicate value and as I was reading chapter 3, Show value for money, I thought to myself that I had the title for my next post. The chapter discusses, well, value for money and the importance of benchmarks, especially for CIOs who have just joined or are thinking of joining/moving to pastures anew.

Benchmarking an organisation’s IT is important whether conducted internally or externally. As the cost is quite high for conducting benchmarking via the established players, such as Gartner, many smaller organisations may initially decide to do it internally. Benchmarking has evolved now to the extent that even universities have started to run benchmarking courses, such as Stanford university’s IT benchmarking certificate, aimed at, yep, CIOs!

As quoted by CIO.com; ‘in today’s business environment, says Bechtel CIO Geir Ramleth, IT needs to benchmark itself against a new set of peers: successful technology companies that built their IT systems in the Internet era. Doing so is a painful exercise for the ego. “Corporate IT is trying to break the sound barrier, and the Googles and Amazons are NOT supersonic. They’re hypersonic,” says Howard Rubin.’

My research has shown that Gartner has created a niche in IT benchmarking, as Gartner currently holds one of the largest global IT Trends and Benchmark Database. Dr Howard Rubin, created this global database and is a world authority on IT benchmarking and he offers the following thoughts and advice (Courtesy of Computer Aid Inc – CAI):

‘CAI: How do organizations interested in benchmarking best determine what they should be measuring and how they should be measuring?

Howard Rubin: I think the key thing for organizations is bi-directionality. That means your approach to benchmarking must come from both the top and from the bottom. From the top, you really have to understand your technology costs- the costs of your technology goods and services- almost as if you were a manufacturing company. You have to understand the cost structure of technology, what its impact is on your margin and what the impact of your technology investment is on growth, shrinkage and market share. And you have to integrate your understanding of the cost structure and performance structure of technology directly into the company’s financials.

You also have to figure out who you want to be looking at, in terms of comparisons. Is it direct peers or is it organizations that have a business performance structure that you aspire to meet? Another point I should make about the choice of measurements from the top is that there is this thing called the balance scorecard, in which people look at their finance measures, customer related measures, profit measures and organizational measures; but these are just static measures. That means that if a company’s strategic objective is to be the number one player within a given market, or to have the most comprehensive view of the customer, the balance scorecard isn’t going to cut it.

It is directional measures, as opposed to static measures, which will tell you where you are moving versus where you would like to be and what your corresponding rate of change is. And there are basically three kinds of directional measures: positional measures, directional measures, and velocity measures. In short, you need to be benchmarking where you are, where your targets are, how fast your organization is moving and how fast the world is changing. And all of this must be done within the context of strategy.

Approaching things from the bottom, you really have to understand a lot about technologies and about the technology organization itself. That means much more than just knowing how long it takes to develop an application, or the quality of your software, or the customer service component of your technology.

It means you need to look at technology as a commodity, at the unit costs. You need to be able to understand, almost like having a technology catalogue in front of you, what all of the technology components of your business consist of. What are your volumes? What are your unit costs? What are the costs to your competitors? What other alternatives are available out on the street in the open market?

And there are some other aspects, too. If you are a CFO, for instance, you really ought to understand where technology hits your P&L, where it impacts your salaries, your expense, and your depreciation. It is very important to understand how fixed or how variable your technology costs are.

Finally, there is a kind of ethereal dimension that sits on top of all of this, one which involves how well you are using technology to innovate and change your business, as compared to your competitors.

In the end, what companies really need is a full navigational system. Something that will give them the instrumentation to get them where they want to go, as well as the external calibration to see if someone is going to get there first, second, better, cheaper, or faster.

CAI: What are some of the major challenges that most organizations encounter when they first get started with measurements and benchmarking? What are some of the most common mistakes made? Do you have any caveats for organizations that are undertaking this for the first time?

Howard Rubin: When you first get started with benchmarking, and you haven’t done it before, you are basically going to be comparing data that you have internally with external data. Consequently, people will get their internal numbers and then they will get their external numbers and try to compare the two things right away. They will be looking for insights and conclusions and hypotheses. However, after the first round of benchmarking, you should really be making an effort not to look for insights and conclusions. You should be focused on rationalization. First time starters need to understand that rationalization is part of the benchmarking process. It is not a precursor to the process.

The other issue with first timers is the availability of data. It is very important to overcome the fact that you may not have a complete set of data available internally. This is always going to be an issue. Consequently, my recommendation is to look at your benchmark program as if it were a step function program: take a small core, build out, step up, sort of ratchet, take the key questions needed to answer the first, and have the benchmarking provider map your structure. You don’t need to do everything at once. You can build things up throughout the process.

A final caveat involves management by numbers. For example, you will find many large organizations that have gone through multiple mergers and that haven’t shed any of their redundant systems or redundant technologies. Certainly they can do better. But the path upwards is not going to be visible just by looking at the numbers. There may be a whole lot of other things that have to happen first. This is especially true if you are using benchmarking for internal target setting.

My brother is a really fine physician and he always advises his students not to look at the numbers but rather, to look at the patient. That’s an important caveat in benchmarking, too. The numbers will give you calibration. They will help you understand what side of the benchmark you may be on. But the goal is not to be better or worse than the benchmark. On either side of the benchmark, you can be learning how to improve your position.

CAI: You are known, among other things, for having collected and organized data into one of the world’s largest information technology databases. Could you give us more information about this repository? For example, what kinds of metrics get tracked? How broad is the technological and geographical representation?

Howard Rubin: The Worldwide IT Trend and Benchmark Database was really formalized in 1994. It was a project, as I mentioned before, which started out within the Canadian government. They were trying at the time to develop a global view of technology utilization in business.

In its current form, the Worldwide Benchmark Database maintains data on more than 10,000 large companies, each typically over 500 million dollars in revenue. It covers companies that are based across 100 countries, so it has a really massive geographic spread. There is also a large diversity of data, everything from basic business and IT spending data, to detailed data on technology platforms, programming languages, application development productivity, application quality, size and number of personnel, compensation, practices and processes, and process maturity. You will even find customer service related data.

The database is also updated continuously. We use internet based surveys for this as well as data collection mechanisms that originate from within our own consulting engagements. Consequently, we are able to keep the data fresh, on a daily basis, and we are able to update major trend levels on a quarterly basis. What that means is that if we see a major business or political change, we can sample thousands of companies within a 24 hour period to see if there is any movement. I don’t think anyone else in the world right now has the capability to determine, within 24 hours, the effect on business decision-making and technology that a world event may have.

You originally asked me about how benchmarking has changed over time. Traditionally, benchmarking has been used to compare current data to historical data. What we are seeing now with the worldwide benchmarking database, however, is the comparing of current data with current data. That’s an important development in my opinion because data is kind of like produce: it gets rotten after a very short period of time’.

An article in CIO.co.uk, said: ‘Two decades of research by Howard Rubin, president at Rubin Systems, reveals two key concepts that can enable CIOs to see whether their IT investments are really adding up. He found that measuring IT spend against two factors – operating expense and net revenue – is a more accurate gauge of IT effectiveness than the metric of measuring solely against net revenue.

In addition, Rubin discovered that enterprises spending slightly more than their peers tend to have better business results. But after a certain point, that extra spending does no good. Rubin calls the sweet spot of extra but not exorbitant spending “optimal IT intensity.” He calculates IT intensity by comparing the IT spend to both the operating expense and net revenue, and has developed IT intensity curves that help CIOs see if they are under-investing, investing an optimal amount or over-investing.’ Another good article, I recently read was Using Benchmarking Metrics to Uncover Best Practices and is worth reading if you want to embark on benchmarking your IT.

I would like to conclude with a quote from The Real business of IT – How CIOs create and communicate value – Randy Spratt, CIO, McKesson: ‘We opened up our finances and made them transparent. In mid 2006, we delivered a one line allocation to the business. Now we deliver a complete invoice. Between transparency, benchmarking, and competitive bid efforts, we have strengthened the view that our finances are under control, we’re driving to continual improvement on a per unit cost basis, and we hold ourselves accountable for delivering to service levels. “We don’t hear, ‘Why does IT cost so much?’ now. Do we still have expense level conversations? Yes, but they’re more about how we can jointly reduce costs.”

Further resources:

NCC IT Department Accreditation

NCC Benchmark Surveys

Benchmarking IT services

CIO Infrastructure Benchmark Assessment Tool

FREE IT Infrastructure Benchmark

Get a free instant benchmark of your SAP system

IT Benchmark Blog

Metricsboard.com Blog

Organisations “Don’t get” social media

Social Media: Changing Business

Image by Intersection Consulting via Flickr

POST UPDATED 09.12.11

In general most organisations still don’t understand or don’t want to understand the impact, benefits and competitive advantage that social media can, in many cases, still provide. The problem lies in the half hearted way many organisations introduce social media within the organisation. Brian Glick, in his ComputerWeekly column said that (In summary) organisations in general still thought that employees, if given the option, would spend their time on social media sites instead of working are missing the important point. Organisations could reap significant benefits and it was in the interests of organisations to improve collaboration and communication with ‘customers, suppliers and partners.’ One of the reasons for not adopting social media is that social media is at the stage where email and the Internet were 15-20 years ago. I remember that at the time many organisations used to view email/Internet access in the same way. Now, email and Internet access forms the fabric of most organisations. For those organisations that just ‘don’t get’ social media, I will provide a simple three step process to ‘get you there.’

Step One – The social media policy

This does not have to be a completely new policy; this can be an addendum to the existing computer usage or Acceptable Use Policy (AUP) of an organisation. This should include acceptable/unacceptable behaviour for employees on social media such as blogging, social media sites such as LinkedIn, Facebook and Twitter etc. The secret is to embrace social media, get your employees involved and make them your ambassadors in the new world of social media. Tony Redshaw, Aviva CIO captures the essence well, “If you want people to use it, you have to tolerate them using it and not always in the way you expect.” To get you started, here are a few links:

Step two – Internal and external Social Media adoption

Harnessing the power of social media will provide you with two key benefits:

  1. Collaboration and knowledge sharing becomes easier. Organisations of all sizes have struggled for years to capture the expertise of their knowledge experts without much success. Internal Social media platforms make that process simple and employees are encouraged to create ‘expert’ content. Expertise becomes easier to access, as Aviva’s example (QUICK STATS – £350 Billion assets, £50 billion sales, 54000 staff, and currently 120 wikis with potential for 600 more) demonstrates. For example, in Aviva’s case, Tony Redshaw, Aviva CIO said, “One of our people in the Melbourne office was having a complex issue. Someone in our York (England) office saw their online post. Within 24 hours they had related their experience and suggested a way of fixing it, and…problem solved. There was no way before for the two to hook up and for that information exchange to happen.”
  2. The younger generation leaving schools and universities is social media literate. They already have social media profiles on Facebook, MySpace and Bebo etc. Organisations are finding it hard to recruit and retain youngsters where social media equivalents are not available internally and where social media access generally is restrained. The primary reason is that these younger people utilise these technologies to communicate and interact with the world at large. Embracing the younger generation through social media adoption can bring benefits that may not have been anticipated. They will utilise these platforms in innovative ways, providing competitive advantage and adding to the bottom line.

Step three – Setup and monitoring Social Media

Organisations’ spend tremendous amounts of their finances on marketing and advertising but tend to spend no money on correct setup, creating the correct social media culture and actually monitoring social media. For the past month, I have been researching an organisation that thinks that it ‘gets’ social media. The way they have decided to setup their social media, I am sure, in their opinion is correct. Let me just explain how they have setup their social media. They have a blog but only their wholesalers can access it and oh, by the way, they would have to register to read the blog articles. They have setup a social media account with one of the main social media platforms. End customers are not allowed to become members of that group, as it is aimed at the wholesalers only. Customers have been wandering the web looking for information about their products but cannot easily access information about their products or have anywhere or anyone to go to for further information; even product enhancements have been discussed by customers. An independent site talks about the chemical products in their products as naturally occurring and their website fails to display that information. Ok, so why am I telling you all this and why is it important?

Let me explain. Social media is not a tool where the success can be measured in a given time frame/short term. Relationships are developed and nurtured utilising various social media platforms over both short/long term. It is a tool that allows us to interact with each other and our customers. The need is to, ‘engage and interact.’ This particular organisation has not done that. In actual fact, it has unconsciously created all sorts of barriers stopping its very customers reaching and interacting with it. I couldn’t find any evidence of anyone utilising social media to have any conversations anywhere with its customers. Social media is not being monitored and so this organisation has no way of knowing if anyone is posting any comments (positive or negative) anywhere on social media.

For example, I did come across some negative comments that could have been countered by simply informing the customer on where to find the information. Another example covered in my blog post a few weeks ago showed that if , Toyota had monitored social media, it would have become aware much earlier that its customers were unhappy and that it could impact Toyota’s reputation. Here are a few links to get you started:

More SM Tools:

Hootsuite , Tweetdeck , Yoono , Wefollow , Listorious , Twellow , Twellowhood , Klout , Visibli , Quora, Instagr.am , Pitchengine , Addictomatic , Tubemogul , Untweeps, Twitalyzer , Topsy , Ping.fm , Friendfeed , Google Alerts , Postrank , Storify , Backtype , Big-boards/ , Getclicky , Twitterfeed , Twitter Search , Onlywire , Hashtracking , Socialmention , Seesmic.com/ , Flock , Pingdom.com/ , Hubspot , Diaspora , Monitter.com/

Top Commercial Tools for large organisations (Cost more, probably not affordable by small business or for personal use):

Top 20 Social Media monitoring vendors for business

Radian 6 , Lithium , Attensity 360 , Alterian , Spiral 16 , Buzz Logic, Cymfony , Cision , Trackur

In summary:

  • Ensure that you have appropriate policies/guidelines to help employees navigate social media.
  • Adopt social media in a way that benefits your organisation and interact with a wide audience.
  • Monitor social media and use it to interact with your customers, suppliers and partners.
  • The objective internally is to create an environment of collaboration that allows the open exchange of ideas.
  • The objective externally is to create a ‘buzz’ and awareness about your product and organisation, in addition to PR.

Globalisation and management

Updated 9.12.12

Globalisation is an interesting word for me as being British, I spell it with an ‘S’ and Americans spell it with a ‘Z’. Proof that even languages, such as English (currently, the global language for business) have become affected by globalisation. I also find it fascinating that in the land of my fore fathers (historically known as the Indo/Pak sub continent –currently, India, Pakistan and Bangladesh), the word, ‘anyway’ is always spoken as, ‘anyways’. These permutations of language also affect how we trade, live and interact as a global society.

Globalization or globalisation as we know it was termed, in 1983, by Theodore Levitt, a former Harvard Business Review editor who used the term for an article about the emergence of standardised, low- priced consumer products. Globalisation has been fuelled within the last 10-15 years by IT. That includes hardware (HW), software (SW), connectivity (falling costs of HW, SW, ever larger pipes globally and VOIP solutions), cheaper travelling costs and a truly global workforce. As a result, CEOs and boards have used successful globalisation case studies to convince their businesses that it would lead to profitability and competitive advantage. For example, a software problem submitted at close of play (COP) today could be solved by the time America wakes up the following day (arguably saving costs and solving problems while sleeping).

The decisions that need to be explored in great detail are the reasons for deciding to go beyond your own border with a view of going global. I would categorise the reasons as one of the following:

  1. International opportunity
  2. Saving costs
  3. Skills shortage
  4. Legislative requirements
  5. Social and Corporate responsibility (CSR)
  6. IT Challenges

1. International opportunity:

This decision is usually taken when management realise that there is a demand for their product in another part of the world or that a demand for their product can be created. There are many examples of this such as Coca Cola. Coke as it is also known as is a trendsetter as it firstly; created a demand for their product (Did our grandparents know they needed to drink Coke?). This was followed by then satisfying the international demand. Recent success stories are led by Apple and the iPhone.

2. Saving costs:

Arguably, many would argue that this is an opportunity. I will discuss this later but for now let’s take it as it is. I would term this as ‘cost savings’ that can be realised through leveraging access to cheaper materials, labour or anything else that costs less than the local equivalent within a business’s own borders. Again, there are many examples of this such as Nike and Primark who outsource manufacturing facilities to countries such as India, Pakistan and South Africa etc.

3. Skills shortage:

Many businesses need to take this step and it is particularly true for IT led businesses, such as, software. Sometimes due to, for example, a skills shortage  a business may be forced to go beyond its borders. In my Indian software example (Para 2 above), it is recognised that another reason/advantage to outsource was the time difference.

4. Legislative requirements:

Countries allow international trade but will, for example, place a restriction on the amount of a product that can be imported by legislating import tariffs etc. For example, Toyota got around that problem in the early eighties by opening manufacturing plants in the US.

A business that wants to take advantage of this global reach has to consider the social and corporate responsibilities of globalisation and the IT challenges.

5. Social and corporate responsibility:

Anita Roddick of the body shop set the standard for being one of the first to prove that ethical business could be done globally. She pioneered the ‘green movement’ as we know it today by including only natural ingredients in her products, sourced globally at fair trade prices while protecting the local workforce, both at Littlehampton where she was born and bred and internationally where her products were used, sourced and produced. Businesses also need to ensure that a balance is struck between moving jobs abroad just to save costs against investing in the local workforce. Arguably, all businesses need to save costs and the rule to apply in these situations is that if a business is commercially profitable (for example, in millions of dollars) is to appreciate the effect of moving jobs abroad (in many cases referred to as outsourcing) against training workforces locally and producing a skilled workforce for the future.

In the short term that may translate to fewer profits but in the long term the business will benefit from a truly dedicated workforce and an investment in people that transcends the short term skills shortage. Globalisation should not be at the expense of a lack of investment in local people and infrastructure. Short term competitive advantage ( in a situation where saving costs is the primary driver) is usually lost to the outsourced country in the long term.

6. IT Challenges:

Connectivity costs within IT are falling daily and newer areas of the globe are becoming easier to connect. IT challenges still remain and businesses need to involve Chief Information Officers (CIOs) in the decision making process when they start to think globally. The earlier the business involves the CIO, the quicker the eventual deployment of IT enabled business becomes. In an earlier post on competitive advantage, I have emphasised the importance of the direct connection between the CEO and the CIO and that has to continue when businesses have global aspirations.

Providing IT internationally always has challenges and I would suggest that for globalisation to be successful, the CIO needs to be a visionary, businessman and a leader. The CIO will have to deal with issues where the IT capability may have to be imported, sourced locally (as importing IT may be too costly), have to deal with poor infrastructure, connectivity (in many parts of Africa) and have to deal with local legislation. Successful global CIOs will be the ones that can provide ‘out of the box’ solutions, have created great teams locally and globally, stay connected with their global staff, understand the different cultural variations and their impact to the business and have a network of advisors within and outside the business. CIOs have a great overview of how IT works and how it can assist the business but CIOs will never know everything, so they need to have access to peers, other CIOs and a network they can turn to and learn from without reinventing the wheel. If a CIO doesn’t have global exposure prior to a business going global it can sometimes be an advantage as it’s a clean slate and the CIO can utilise their own experience gained in various other industries.

To conclude, as the Coke slogan says, “Think globally, act locally?” Do you agree?

Microsoft and Apple Tablets, pens and swords

It doesn’t really matter whether I take a look at Microsoft’s (MS) Courier dual screen booklet/tablet or Apple’s itablet; I quickly arrive at the same conclusion. I will explain as I go through this article. Obviously, an official statement has not been made by either camp and nor have the names for both products been released as yet.

It was in 2001 when I enthusiastically unwrapped my Windows tablet complete with stylus. I was enthused as I had imagined my world to be free of paper and totally digital. The price I paid for the tablet was probably equivalent to 2500 paper notebooks but I didn’t really care as I was too tunnel visioned by the allure of the future promised by this technology and the MS marketing hype.

I spent some time mastering the stylus functionality and went to my first board meeting. This was the first time I felt a misfit. It suddenly dawned on me that I was the only one in the room with a tablet. The meeting started while I was being scanned by all these eyes that seemed to be under a trance by the tablet. It was just great, I was writing notes and didn’t have to retype them either as the handwriting to type function would quickly create a document for me when I needed it. Then it happened. The tablet crashed. The meeting continued and as I started taking notes on my paper notebook, I realised the trance had been broken, replaced by bewilderment. The tablet rebooted but it was too late, I decided to continue to write on paper.

Well, why am I sharing this with you? I am not at all convinced that these new technologies will be as successful as the iphone or can convince people to part with our love for writing on paper. That said, I would love to be proven wrong as there is a big part of me that wants to use a digital equivalent, if it is indeed practical enough.

Here is my list of reasons why I think these technologies can’t replace our love for paper and why the pen will remain mightier than the tablet and sword: 

  1. I don’t need to start the pen and paper.
  2. If I drop the pen/paper, it doesn’t break or stop working.
  3. Paper does not need to be rebooted.
  4. It is considerably cheaper.
  5. The next version of paper is always the same.
  6. The next version of paper does not require retraining.
  7. Nobody wants to steal my paper notebook.
  8. I know how to locate my information contained within my paper notebook.
  9. I don’t need to migrate my entries in the paper notebook to the next version.
  10. My paper notebook seems at home in any boardroom (for now, anyway).

I could probably go on but you get the picture.

Would you like to add to my list or defend the new technology? Feel free to add your comments; I do look forward to reading them.

David vs Goliath clash on web communication technologies

The Internet continues to expand, evolve and develop. Born as a technology out of a military requirement, Arpanet, the ubiquitous nature of the Internet has meant that mankind has developed all kinds of uses for this communication medium. I sometimes think what would happen, if one day we woke up and found that the Internet was gone. The Internet has managed to permeate and touch our lives unlike no other technology. We are increasingly becoming more and more reliant on it to satisfy our insatiable urge for knowledge and entertainment. We can now, even watch our favourite television programmes across the Internet and stream our favourite programmes across continents ourselves using technologies, such as the Slingbox.

For this blog, as with most of my articles, I won’t reinvent the wheel, and as always will use existing web related resources, wherever, possible. In today’s blog, I am aiming to:

  1. De-mystify web conferencing, webinars, teleconferencing and video conferencing.
  2. Provide a list of web conferencing/webinar solutions/teleconferencing/video conferencing for small to medium enterprises (SMEs) and larger businesses.
  3. Provide further resources/reviews for informed decision making.
  4. Explain the difference between web conferencing/webinars and teleconferencing.
  5. Explain the benefits and features of online meeting software.

One of the problems that bloggers like me and indeed the general public/businesses are facing these days is the old adage, big fish, eat small fish. The IT solution arena, faced with global competition and diminishing returns, a desire by the big players to have monopolies etc has led to the IT market undergoing significant reshuffle and consolidation. This has led to a great deal of confusion on who owns who, especially if you are not actively following the IT industry. For the uninitiated and for the benefit of everyone, the Internet infrastructure is already largely managed by Cisco routers. To provide Cisco with competition in this arena and to strengthen its other networking products, last week HP purchased 3Com.

Let’s stick with the theme in the previous paragraph. Within the web conferencing, webinar, teleconferencing and video conferencing solutions, the demarcation of what now signifies a particular solution is becoming blurred as they all seem to be morphing together, so in the not too distant future, what this morphed technology will become and be called, is open to speculation. This thought is further strengthened by the acquisition of WebEx by Cisco in 2007 and the recent offer in October, this year, of video conferencing solution provider, Tandberg ( UPDATE – This offer, incidentally, has been upped again in November). Within the video conferencing arena, telepresence, has been touted as the next killer application, although while gaining some ground within larger corporates, it hasn’t really taken off. That may change with Polycom’s new telepresence solution. Polycom has created a clever alliance with Microsoft by licensing its technology, thereby protecting its position. As Tandberg bites the dust, in this David vs Goliath battle, so far the Goliath’s seem to have the upper hand as these solutions move into the lucrative world of Smartphones.

Best solutions for SMEs

Dimdim (Recently acquired by Salesforce – 2011) is free for up to twenty users as a hosted solution and free for upto 50 users if a business hosts it on its own servers. I was quite impressed with their clever use of YouTube for their tutorial videos. One site that I visited levied some criticism of its features and I was quite pleasantly surprised to view the first comment submitted was by one of their employees informing the reviewer that his criticism had been submitted to the developers for further investigation. I predict that Dimdim is the web conferencing platform to watch for and should very soon be giving the big players a run for their money.

Yugma is my next free solution and is free for up to 20 people as well. Again, Dimdim and Yugma are the rising stars of the web conferencing world and both offer Pro versions for businesses.

For teleconferencing, I haven’t been able to find many solutions (I admit, I was researching web conference solutions in more detail) but having used BT MeetMe in the past, I believe it is available cost effectively for SMEs. Skype, does allow for upto 25 users to have a teleconferencing call across the Internet FREE but be wary of the possible loss of quality on calls. Skype Video conferencing (requires a web camera) and is currently limited to a one to one session.

Best solutions for larger businesses

It is worth reading Gartner’s Magic Quadrant for web conferencing 2009 2011, prior to making any decisions as it is a great in depth report and to view a comparison of the top ten (In their view). For other reviews, please click on the following: Review 1, Review 2.

For larger businesses the names that are most recognised are (in no particular order), WebEx MeetMeNow, Microsoft’s Office Live Meeting, Citrix GoToMeeting, Adobe Acrobat Connect Pro, Fuze Meeting, Intercall, iLinc, MegaMeeting, Glance, WiredRed e/pop, Zoho Meeting, Elluminate Live, IBM Lotus Sametime, Unyte Meeting, PGi Netspoke webconferencing, and others.

Challenges facing CIOs at the UK’s leading companies

If you enjoy my blog, please recommend my blog for the Computerweekly IT Blog Awards 2009 in the CIO/IT Director category at:

http://www.computerweekly.com/nominate

Recently, Jeremy Oates, – Managing Director for Accenture systems integration & technology did an interview for Computing magazine – 10/8/09 and was asked about the challenges facing CIOs at the UK’s leading companies.

I enjoyed that interview and have responded by providing additional answers to Jeremy’s thoughts, as below:

What is the biggest problem for FTSE 100 CIOs?

I just wanted to discuss the Green IT issue in a bit more depth. CIOs need to recognise that the Green issue will be climbing higher and higher up the CIOs agenda. Addressing this is not just good business but a necessity. We are increasingly living in a world that faces an energy crisis and a pollution bombshell. Anything that we do that can lower our carbon footprint will be good PR, good business, provide a good ROI (For example, reducing travel expenses by video conferencing) and value for money. It is the duty of any corporate citizen to ensure that we leave a sustainable world for future generations.

How can these problems be solved?

In addition to your thoughts, there are once again, at a corporate level many initiatives that can be introduced that can address the problems that we now face. Every CIO should have a team looking after innovation and ensuring that it is horizon scanning to ascertain the technology that could be the next killer application or IT, ‘must have’.

Businesses’ need to ensure that they actively promote IT graduate placements (Discussed in my blog – The future graduate and the IT and computing skills shortage –http://tinyurl.com/skillshortage) and women are encouraged to not only become IT graduates but to work within the IT arena.

Businesses also need to look at mobile workforces and how best to equip them (Phones vs Smartphones), how best to use social networking (bearing in mind the next generation knows no other way to communicate) and how to leverage Cloud Computing. In addition, ERP systems need to be utilised more efficiently as well.

The above will generate new ideas and solutions for new world problems.

What are the challenges for enterprises considering cloud-based services?

As outlined before, innovation and horizon scanning should mean that businesses start to research cloud computing and what it can do for businesses (Discussed in my blog – What is Cloud Computing? Its Pros/Cons and making it work – http://tiny.cc/mXOJA). The challenge will be whether businesses are prepared to take the same applications into a ‘test cloud environment’. The issue of security and enterprise data can then be tested. The risk here is that this is a double edged sword, whether to operate in the cloud or not!

£70 billion dollars is being pumped into global broadband infrastructures, so the question is not if but when!

What is the biggest compliance issue facing FTSE 100 firms and how to prevent data loss and security breaches?

I agree it is Security and in my view the one single reason for data loss is human error. Technology, for example can encrypt data but cannot stop an employee from leaving a physical paper file on the train or stop onlookers looking at sensitive data on the screen of a laptop. Business cultures need to change through education and understanding. Businesses should take the UK government’s view  – http://www.nationalschool.gov.uk/news_events/stories/PI.asp and ensure all employees handling information undertake appropriate exams/certifications.

What is Accenture’s view on Digital Britain, particularly the next-generation optical-fibre rollout? Is 2Mbit/s as a universal service commitment (USC) good enough?

To enable the UK to be a market leader for the next generation of product/services that will enter the market as a result of universal broadband coverage, we must be at the forefront of this technology. For example, Australia is spending $33 billion for broadband speeds of 100Mbit/s and the UK is enabling only 2Mbit/s. The statistics prove that the UK is equipped with better connectivity, or we risk being outperformed by countries that are investing  heavily in the telecoms infrastructure now rather than tomorrow.