Let's Change the Business Model

Ever thought about reinventing your business ? I don't mean providing new services or expanding the offering, I mean fundamentally changing he economic model of how you make money.

Let me offer an example. Let say you make zippers (invented in Canada btw... look it up). Your zipper business has traditional pressures, manufacturing material cost increases and pressure from offshore competitors with lower labour costs. The price you're able to command in the marketplace is under pressure too as your product risks commoditization. Normal stuff in a business sense and not dramatically changed I might suggest (except in scope) in the last 10 years.

Historically you have sold zippers on a unit basis and discounted based on bulk purchases, which mapped to some degree to large manufacturing bulk order efficiencies. But. And here is where is gets interesting. What if you examined the value created by the zipper of those that bought it, and instead of selling it, you elected to rent it, or charged per hour that it was used. Now my example is a tad extreme here I’ll admit, as a zipper doesn’t constitute a large percentage of the cost of say, a pair of trousers, but the theory here holds. Placing a small sensor device within the materials to understand (and have relayed) when it was zipped (vs not) would enable you to gather usage profiles and put together a pretty clear picture of the nature of your offering’s use. Instead of selling it, perhaps you might charge per zip-up (or zip-down dependant on the market segment). We don’t think much of the value of a zipper normally – except when we really need it, and it becomes an indispensible part of the overall product. Ever thrown away a pair of pants due to a broken zipper, or perhaps a jacket or a tent that’s not kept out bugs ? I have. Now let’s extend this a little further. What if I offered hot swaps – replacement zippers so the users wouldn’t experience downtime (sorry) or have to throw out the whole greater package. Interesting yes, but it doesn’t make sense, does it…zippers are very very inexpensive and easily replaced. OK, let’s talk jet engines instead with the same situation imposed. Hmm.

As we look at our businesses, often the age-old pressures and tasks of pushing down our sourcing and creation costs and trying to fight for share in our old-world approach to buying & selling traps us.

Open up your creative side, and imagine how your customer uses whatever you do, and then creatively try to address that need – with a win for them in mind. That may see you radically reviewing how you collect their money.

Fire in the Middle East

Is this unexpected ?

No really, should the idea of a repressed group of people fighting back and being very angry surprise anyone..?

I was reading a little from Reza Asian (the author of No god but God) and learned the following today.."Seventy-five percent of the population of the Middle East is under the age of 35; fifty percent is under the age of 25. In Egypt, the median age is 24. In Algeria it is 27. In Jordan it is 21. In Yemen it is an astonishing 18! According to Reza Aslan, it is this restive, socially conscious, politically active, and globalized youth bulge that is changing the face of modern Islam." With unemployment reaching up to 40% in some parts of the region, is it any wonder that these people are restless, frustrated and angry..?

If you combine that with leadership that has been thrust upon them, supported by (suspect in their view) western governments and an almost complete lack of freedoms that we take for granted here...well it's only needed an ignition point. That came from the Tunisian student who set himself alight and captured the feelings of the generation, that it was too much to bear.

The youth in the middle east aren't very different from youth anywhere else. They believe themselves infallible and have enough knowledge to identify what they don't like. They don't have all the solutions (As is obvious from the streets of Cairo these days), but in reality what very young person does..? The vacuum here is wisdom and calm leadership from a voice that is respected by them - one that will be listened to. Historically, as in the west, that came from the religious leaders, but they appear to have been compromised by their own manipulations of power and perceived alignment with these autocratic regimes.

So what will happen - will they buy into the "I'll be nicer in future" comments the leaders in Egypt and other countries are making ? (I promise not to run again in future). Or will they take their cue from the Who - "Won't get fooled again". No one knows, and that includes the various deeply interested local parties that are very invested in the potential outcomes.

Can we help, should we help, if we did want to, who would we help ? All valid questions and all have varying answers. If I have learned anything it's that the values I hold dear, and define my way of living are my own - they shouldn't be forced onto anyone else, so to preach that this solution, or that direction is best for them reeks of hypocrisy and a blatant mis-read of the sentiments flowing across the region. My hope is that a voice of reason trusted across the age-divide emerges, and helps calm an extremely combustible situation.

Right now we have a wild-fire, and like a real fire, it will consume all in it's path until it reaches a natural or man-made obstacle. It will keep burning unless extraordinary measures are taken to put it out. Or it will die out naturally once it's passion dies. Ether way, it'll leave behind a charred landscape that will take time to prosper again.

Feeding Your Relationships

A good friendship, a strong one - it can withstand a period of inactivity. Weak ones can't. Even the strongest ties wither over the long term though, and years of no interactions erode the very idea of the friendship.

The death of a friendship isn't loud or clear or something we perceive at the same time, rather it is insidiously creeping in the background. It's the unspoken birthday greeting, or the lack of awareness of some major happening in the others life. Beyond when you stop speaking, it happens when you no longer think of one another. And then one day you just know it's gone.

It's not hard to keep it alive though either. The occasional discussion or the Christmas card holds it status quo for long periods. But like any living thing, you can only abuse a friendship through neglect for so long.

The death of a friendship isn't something we actively contemplate, so your task for today is to think about some old friends and make a conscious decision on whether a little investment there is worthwhile. In the end with any friendships, we should all acknowledge that no decision to act is a decision in itself.

The Killer App

As a fan for a long time of what they do and unabashedly showing some national pride RIM lately makes me very sad. You see they guessed wrong and are now on a downward slide.

Their products are still top notch and they still do corporate email connections that are the most robust and resilient. But it's not enough and these days it's not even the right card to be playing.

Phones morphed - if this is news to anyone the next point may be too freaky to consider. They moved from devices where our communication has broadened from push to pull. Talk to someone on my phone ? Well sure it's possible if you don't want to video conf or announce your proximity seamlessly or browse or play games. (did you know the #1 game platform isn't Xbox or Playstation or Wii, rather it's the iPod Touch).

RIM and the Blackberry suite of devices have been all about the email connection and for a long time as society's comfort level with non-voice uses of phones were developing, we all saw email as the killler app. That served them well, becoming one of the worlds largest five smart phone firms. But as their emergent role seemed firmly in place, other players (Apple, Google) saw fit to change the focus and pushed "apps". Better screens, resolutions and processers and user interfaces made this possible. With limited success at first, this app focus did eventually take off and while RIM has seen this and started to embrace it, in reality they are too late as they didn't move away from their QWERTY email centric devices fast enough. Sure there's a pad in the works, just like a hundred other companies. Sure they have an app store - but it's not a fully functional ecosystem the way the Android or iPhone one is. It's an afterthought to develop for RIM.

Moving forward what's the best path for them ? License out their software approach (for corporate email servers) like Palm did. But where is Palm now ? Continue to push away like Motorola ? (but admittedly that company went way downmarket and RIM may not have the stomach to be a price competitor having focused on value creation until now).

RIM is a victim to a trend that has moved on. So save your Blackberry as a museum piece. You can position it alongside your electronic calendar organizer with that cool stylus pen.

Sublime

Perhaps it was the early hour, dawn scratching through the cold air at ground level.

Perhaps it was every nerve fiber being accelerated, or the stability and luxury I was ensconced in. Maybe it was the beauty of the landscape, one of those frost-tipped-trees mornings where forests are painted an intricate white.

Hurtling along at 200kph and watching the rearview in case a 'fast' car came along, I moved with the effortlessness of a bird up and over hills and curves.

It was relaxing and exhilarating, beautiful and blurred all at once.

What a great way to start a day. Unforgettable.

Change for the Peak

This past week saw the culmination of a few months work with multiple clients. They were intertwined in dates, locations and approach. Both presented challenges, some complimentary and some contradictory. I was fortunate to have worked with some excellent other people in both cases and I knew I was never alone. Nonetheless it was a mildly grueling push to the top, with the nature of the work relfecting life - the hardest effort was required to get to the summit.

I was heartened in both cases and pleased with both my own personal results and the overall achievements. Importantly, the customer(s) seemed genuinely thrilled and looked to engage further to help their own people acquire pace in the changes they undertook. This sounds like nose on your face obvious stuff but you would be amazed in a corporate sense how little many care about the creation of success and change. The kicker is the latter, and many of us are afraid of change and even more potently frightened of creating or sponsoring change within their own work. It's risky and it may affect the very job you hold. It rocks the boat and may well be a CLM. That's a commonly held bad thing hence we see the idea of change "talked" but not "walked".

At work, when we get into those situations it's difficult as we want to help the customer discover the upsides of what is possible and at the same time help them bridge their fears. It seems very far off-task when this happens and it's disheartening to see strong efforts go to waste if it turns out the change champion was one-dimensional.

This idea of change affects all businesses as the idea of having a customer buy your offering in whatever form its in, means they are adapting their behaviors to use it. So the issues and challenges surrounding change management are something we should all be aware of and I mean that in a self-aware sense and how my customer behaves as well. It's not limited to the commercial world either. Teachers must change students understanding of a topic to create applicable knowledge. Doctors change our physical being in some way that requires adjusted behaviors - a new diet, walking with a cane, or a drug regimen.

Change is all around us and we all look for it in others regardless of what we do. Look inside first though as it's hypocrisy to prescribe that which you aren't prepared to take inboard yourself. The peak beckons those willing to embrace it.

Inner Peace

I think I've got me some of that recently. Perhaps it's a vacation hangover (the good kind), but lately, I'm able to easily able to see the positive, and calm myself in times of stress. It's as if there's an inner happy place that I'm able to visit at will.

I really like that image, as it seems empowering, scalable and repeatable, though perhaps I'm tricking myself. Much like balance in our lives which I think is a temporary condition we're lucky enough to enjoy periodically. In my head balance = riding a bicycle, invariably moving from side to side a little - never without some motion.

I wish I knew the magic key to this feeling, this 'condition', as it's quite a nice state of mind to be in. My job hasn't changed, but is busier, and my personal life hasn't changed materially except perhaps I'm a little closer to achieving some personal goals I'd set for myself. I haven't won the lottery - notably though I've also stopped trying.

Whatever the reasons, and whether it lasts another hour, day or year - I'm grateful for it. It's a little piece of pleasantness in life that has too few of these (not mine, life in general).

So as my belated new years wish, may all of you enjoy feeling contented at a job well done, and awake with a smile, for there are days when indeed life is good.