I caught this one yesterday on Medium: Culture Eats Strategy for Breakfast. It’s by Dare Obasanjo on Hacker Daily (great title, by the way). It’s a well-thought-out discussion of how Google and Facebook culture achieved a substantial shift of strategy in a way that others (Blockbuster facing Netflix, and Blackberry facing iPhone) couldn’t. Here’s the summary.
“when your strategy changes then your entire organizational culture will have to change as well. Your organizational culture is defined by what positive behaviors you encourage and what negative behaviors you tolerate. Blackberry couldn’t compete with Apple when teams were still motivated & rewarded for keeping corporate CIOs happy and there was no way Blockbuster could compete with Netflix when they fundamentally saw themselves as a classic retail video rental store and ignored the power of online experiences.”
That’s a good read. Dare collected details and presents them very well. There are some stories of interest there.
And it challenges an assumption that I’ve made for decades now, which is that large businesses are doomed to fail eventually because they become like big ships, unable to turn quickly, unable to react. I’ve seen IBM fall from the “Big Blue” industry giant of the 1970s, 1980s, and 1990s to another also-ran today (no offense, IBM). I’ve seen Microsoft fall from the king of the world in the middle-to-late 1990s to struggling to keep up today.
It seems so hard for big tech companies to sustain growth rates when sales run into the billions. Although this post argues against it, I would have thought that Google, Apple, and Facebook will eventually slow down because they are so big. But maybe not.
I’ve never been an employee of a big (thousands of employees, maybe tens of thousands) company but I’ve deal with them as consulting clients. What I thought I saw was that as they grew, middle managers and office politics took over, regardless of what top management wanted. Decision making slowed to a crawl, and the friction through the chains of management became impossible. The culture changed in ways top management couldn’t prevent. Go to an exciting startup and people are working at all hours. Go to a big company and they left at five. Or so it seemed to me.
Can Google, Apple, or Facebook buck that history? Are big tech companies doomed to decline. Live by tech, die by tech? Do they become too big not to fail?
I think it was inevitable. First, the web, then blogs. Content is king. Then Facebook, and then Twitter, and social media is real. Long live the king. The king is dead. We’re gagging on all the content. We need curation. We need to gather and collect — call that curate — our favorite content. The new collection of content is content.
Damn, I don’t need another social media platform. I love Twitter, tolerate Facebook, dabble with Google+, keep up with LinkedIn. I like the ones that let me sign in with Twitter or Facebook. But who needs another one?
But those are all so last year. Now it’s the curation and collection functions driving content. Collect all those tweets, those updates, the links you like, the pictures you like. You put them up on your new curated content site.
Small wonder that Tumblr, Pinterest, Paper.li and others like them are taking off like crazy. For now and 2012, we’re generating so much content everywhere that we’re driving ourselves crazy. I don’t want to estimate how much of my time I spend clipping and linking and gathering and collecting. And everybody’s doing it. Collect and post.
2012’s going to be the year of content collection, and curating.
I liked the phrase social entrepreneurship instantly when I first heard it. It’s doing well by doing good, I assumed, building businesses that help people. A business doesn’t have to not make a profit to do good, so the idea of social entrepreneurship makes sense. Teach kids to read, help people stay healthy, clean the environment, fight discrimination, and make a fair profit doing it. The world will be better for it.
But wait: Don’t all businesses have to make the world better, and solve problems, just to survive over a long term? A business can poison people or the Earth, or cheat people, for a while, maybe … but eventually that business will die. Won’t it?
So doesn’t all new business have to be social enterprise? Or is it not so much doing good as just simply not doing harm? That’s a tough question.
What’s hard, though, is working some of this into real life. If social enterprises solve “society’s most pressing problems,” then damn, that rules out a lot of very good and very well intentioned business that I would have called social enterprise. Does a restaurant serving healthy, local, organic food qualify? How about a business selling all-natural no-animal-testing cosmetics? What about a business selling electric cars? Chevrolet and Nissan (the Bolt and the Leaf) are social enterprises now? And if you start to expand, then what about AT&T (communication) and Exxon (energy)? Are they social enterprises? Maybe they trip up on the “innovative” qualifier, as in “innovative solutions to society’s most pressing problems.”
I’m still confused. I will say, though, that in my lifetime I’ve seen a gradual but steady increase in the general consumers’ concern for social and environmental considerations. Frustratingly slow, perhaps, but it’s there. And it also seems like we’re in a new age of transparency, whether the big behemoth companies like it or not; bad businesses have trouble keeping their badness secret for very long.
The underlying story of a business, the people behind it, and its values, these all matter more now than they used to.
People ask me often what kind of business to start. Usually I say something like “look in the mirror,” continuing with how the best business for you has to reflect who you are and how you’re different. But here’s a new thought for you: choose the market you’re going to disrupt.
This isn’t for the sandwich shop, graphic arts business, dry cleaner, or new restaurant. It’s for the rarified air of the big bang startup. What market doesn’t work? What market can you radically change?
If your new business blows up an old market, then you really matter. Think of Netflix, amazon.com, Google, Hulu.com, and other big winners. ZipCar. Expedia. Twitter. Facebook.
In every one of those cases, somebody applied a new way of thinking to an annoying old way of doing something.
I heard it yesterday from one of the smartest and most successful people I know, my son Paul, CTO of Huffington Media Group:
“I’ve seen the way smart investors work. If it’s a team they believe in, and they focus on a market to disrupt, it’s going to work. They’re going to get going, change it often, and make it work.”
Remember that dream we all had together, not so long ago, where a well-thought-out startup with a good understanding of the Web could grow on merit alone? Isn’t that sort of what Google did? And many others? I fear that’s not happening anymore.
The problem is that content on the Internet is growing exponentially and the vast majority of this content is spam. This is created by unscrupulous companies that know how to manipulate Google’s page-ranking systems to get their websites listed at the top of your search results … Content creation is big business, and there are big players involved. For example, Associated Content, which produces 10,000 new articles per month, was purchased by Yahoo! for $100 million, in 2010. Demand Media has 8,000 writers who produce 180,000 new articles each month … This content is what ends up as the landfill in the garbage websites that you find all over the Web. And these are the first links that show up in your Google search results
Don’t think for a minute that Google isn’t working on it. In another January post, Google search quality czar Matt Cutts wrote a blog post promising a major effort to revise Google search to deal better with spam. And that’s been happening. Google is in fact shaking things up, which is good news for the long term, but, well, Google is shaking things up. The Los Angeles Times’ reported recently…
Google won plaudits for promoting original research and analysis and banishing pages littered with second-rate content or overloaded with advertising. But the revision to its secret mathematical formula that determines the best answers to a searcher’s query also caused an uproar as hundreds of sites complained to Google that they had been unfairly lumped in with “content farms,” which churn out articles with little useful information to drive more traffic to their sites.
Google seems to be doing everything it can to improve its algorithms so that the best content rises to the top (the recent “panda” update seems to be a step forward). But there are many billions of dollars and tens of thousands of people working to game SEO. And for now, at least, high-quality content seems to be losing. Until that changes, startups – who generally have small teams, small budgets, and the scruples to avoid black-hat tactics – should no longer consider SEO a viable marketing strategy.
Tim Cohn posted The SEO is Dead Debate the following day. He doesn’t reference Chris Dixon specifically, but he has an eloquently short post, saying that SEO isn’t dead because ….
… the SEO is Dead author never offers an equal let alone superior alternative.
That one bothers me. Since when does nothing die without offering a superior alternative?
I was browsing the NYTimes online yesterday when I discovered Search Optimization and Its Dirty Little Secrets. I couldn’t stop reading. Author David Segal investigates the dark side of search engine optimization in a story that blends mystery and suspense while it gives good background of something that affects most everyone who owns a business.
Segal starts by setting the story:
PRETEND for a moment that you are Google’s search engine. Someone types the word “dresses” and hits enter. What will be the very first result?
And from there, introduces the mystery of JC Penney’s seemingly inexplicable search-engine success:
The company bested millions of sites — and not just in searches for dresses, bedding and area rugs. For months, it was consistently at or near the top in searches for “skinny jeans,” “home decor,” “comforter sets,” “furniture” and dozens of other words and phrases, from the blandly generic (“tablecloths”) to the strangely specific (“grommet top curtains”).
What happened? That makes for great reading — about search engine black arts, cheating the algorithms, manipulating links, fly-by-night stealth sites, and big business. And it seems like good investigative journalism as well. The Times paid a search engine expert to drill down into JC Penney’s success, and what he comes up with was surprising to me. Especially when I thought about how much is implied but not actually said.
And it includes a lot of background that’s good to know. Most businesses depend on search engines and search engine placement. And some of this is scary.
Quick thought for the day: business landscapes change. Giants fall. Startups become giants.
The giant, the big power, that everybody fears, and by whom everybody wants to be acquired … it’s Google these days. It used to be Microsoft. Are you familiar with Lotus 1-2-3? There was a time when Lotus was the giant of software. And Vision? Look it up: it was the world’s largest personal computer software company in 1983.
Giants are hated and feared.
In January 1985 Apple released the now-famous 1984 commercial that pitted the high-tech newbie against the industry giant (here’s a link to it on (ironically) Google video) … and although it’s hard to believe now, back then that was all about IBM and everybody knew that instantly. Today it’s total anachronism. But IBM was the giant of the industry for about 20 years. It was hated and feared. They called it Big Blue.
So now it’s Google. What do you think: For how long? Who’s next?
I predict accountability is going to be an increasingly important issue as we head into this new decade. The old-fashioned tools of accountability, mainly physical presence, as in hours in the office, or days on the road, are fading. If for no other reasons, it’s because the world can’t continue to support needless commuting, an average of 51 minutes per day in the United States, and way worse in some of the larger cities in the developing world.
So what’s going to happen? We’re going to look increasingly for accountability as part of our real-world business planning process. The plan establishes the metric, and the regular plan review and tracking establish progress towards the metric.
It’s not just sales, costs, and expenses. It’s more metrics for more people, including lines of code, calls, blog posts, tweets, unique visitors, page views, minutes per call, presentations, proposals, emails processed, and so on.
Our tools will give us ever increasing metrics to use. I’m very biased about Email Center Pro, I admit, but if you’re curious you should look into the wealth of metrics it provides on team-managed emails and email addresses, like the [email protected] or [email protected] And everybody knows about Google and Web analytics, paid search, etc. And telephones and miles are completely trackable.
All of this becomes the concrete specific portion of the business plan, and it is then managed as part of the business planning process. That means that the plan lasts barely a month before results are reviewed. Managing the metrics is a multiple win when there’s regular review, because all the members of the team can easily look on together and see where things have to change. And why.
The trouble is that by the time it’s obvious, in terms of ideas and opportunities, it’s usually too late. The winners are already entrenched.
The reef metaphor is a good one, but usually you have to be early on the reef to reserve your spot. Only the big creatures, sharks and all, can cruise in late and get traction.
Coral reefs are ecosystems. Creatures and more creatures develop. Technology is too. We’ve seen technology worlds develop around personal computers, the Web, mobile phones, and lots of others.
One of the smartest people I know, a technology wizard, tipped me off to Robert Scoble’s The Google Reef post last week. That post linked to David Winer’s 2007 Twitter as coral reef post. Way before the rest of us caught on, he saw Twitter coming. Here’s his reef description:
Scattered throughout tropical seas are coral reefs that started when a ship sank and sea creatures made it their home. Then the predators of those creatures started hanging out, and their predators, all the way up the food chain. Eventually, if the ocean climate was right, a coral reef would appear, much larger than the wrecked ship that started it all.
Does it have to be a sinking ship? Reefs develop on their own too, right? I could try to stretch the idea to say personal computers developed over the wrecks of their bigger predecessors, and the Web over the wrecks of the early bulletin boards; but that’s pressing the metaphor too far. What Scoble was talking about was the development of markets around Google.
You have to see it early to win with it. We see here Dave Winer caught on to Twitter earlier than most of us. But then he also caught on to outliners, scripting, and some other things earlier than most of us. Some think of him as the original blogger, and he was there as an early RSS pioneer too. I first met him in the early 1980s, as the man behind the More outliner (and ThinkTank, and others).
Notice the timing: Twitter about three years ago. I think it does us all very little good to be onto some of these trends (Twitter, mobile apps, ebook readers, tablet computers and all) now. Now it’s obvious. If you want to really win, figure out what’s going to be big in 2013 or 2014.
And don’t guess wrong, because that can be expensive. We all assume first in the market is a great advantage, but not when it means you’re there too early. Maybe tablet computers are going to be big when Apple gets there, but they’ve disappointed most of the entrepreneurs who started earlier with them.
What delicious irony. The champion of the little guy has become big brother.
Remember the groundbreaking first Macintosh television commercial, in 1984, with the young woman throwing a hammer into the giant video screen on an evil big brother, smashing it into bits? There’s a role reversal going on.
Apple Computer has taken the establishment role in the booming new iPhone application market. First the iPhone, then well-publicized stories of trivial iPhone apps making thousands of dollars daily, and then the application review process got swamped. And now there’s Apple Computer, the gatekeeper, protector of the establishment, standing between all those developers with stars in their eyes, on one had, and admission into the app store, on the other.
The original idea of review was a combination of protecting the software from crashing, and protecting the Apple store from embarrassment. Ever since the stories of iPhone application fortunes first broke — I fear it was with a fart app making $10,000 a day — the software developers are flocking to iPhone apps. Of course I have no special knowledge, but from the outside looking in, it would seem like the crush of applicants makes long waits, unfair rejections, and inconsistencies inevitable. I’m guessing Apple’s private-sector resources to manage the tidal wave are completely overwhelmed. Mobclix, which tracks iPhone applications with analytics, is reporting that there are more than 85,000 applications approved by Apple so far, and the wait has gone from days to weeks, and is rising.
On a Mobclix blog about the iPhone applications market, iPhone app developer Max Zamkow says:
iPhone developers live in constant fear of receiving an email from Apple with what can only be termed the ‘Death Sentence’: “We’ve reviewed your application and we have determined that this application…will not be appropriate for the App Store.”
He’s developed an app called FruitShoot Lite that lets unhappy iPhone developers (or anybody else) vent their anger by mock shooting at mock apples on their iPhones. But the default fruit target is a banana. And it passed the review.
It’s a couple of months ago now that Jason Calacanis, celebrity entrepreneur and blogger with a known taste for controversy, lashed out against Apple in The Case Against Apple–in Five Parts, in which he complained not just about the “draconian policies” of the iPhone app review, but also four other sins including “anti-competitive” practices with MP3 players, “monopolistic” dealings with telecommunications (a reference to AT&T’s lock on the US iPhone), “hypocrisy” of blocking competing browsers on the iPhone, and blocking Google voice on the iPhone.
Let me just get this straight: A hilarious satirical app made by the Someecards guys cannot get approved because it contains cards that, for example, mock Hitler. But an upskirt app is just fine? That is so ridiculous.
Yes, ironic indeed. On first glance, I look at the rising tide of complaints and I think they’re all delusional: Apple is a business, not a public service, and it owns the iTunes store, so it can do what it likes. Developers waiting weeks to get into the market, living in fear of rejection after all that work? It’s Apple’s clubhouse, so Apple can admit whoever it wants. However, as the whole thing starts to sink in, I have to add that Apple Computer has made this bed for itself, so it deserves to lie in it.
Not that I don’t like Apple. I’ve been a serious Mac user twice, first for about 10 years from the beginning in 1984 until the middle 90s, and again for the last two years. I like the Mac, love the iPhone, love Apple’s products in general. However, I’ve never quite accepted the odd phenomenon of Macintosh and Apple as crusade. The whole phenomenon of some connection between operating systems and good (Apple) or evil (Windows) has always seemed a bit creepy to me. After all, they’re just products for sale. Apple, IBM, Microsoft … they are all big companies.
Apple Computer, however, has actively catered to this odd canonization of brand throughout its history. It wasn’t for nothing that the Macintosh anti-big-brother image is part of our cultural heritage. It wasn’t for nothing that IBM became “big blue” and Microsoft “the dark side” … Apple spent a lot of thinking time, effort, and money on building that anti-establishment tinge to its brand. And it’s not totally crazy to suggest that Apple managed to change brand to aura, or halo.
Live by the anti-establishment brand, die by the anti-establishment brand. What we’re seeing, I think, with the rising protest of developers against Apple, is something akin to a jilted lover, or the famous Shakespeare epithet about a woman scorned. It seems like the backlash is whipped to a frenzy with Apple in a way that it might not be if it were some other big company, or, say, the US Patent and Trademark Office. Companies move slowly, government agencies move slowly, but not Apple Computer. The woman with the hammer in that 1984 commercial, crashing big brother and all. Say it isn’t so. Disillusion.