Tuesday, 23rd January 2018

UserTesting.com Offers Pre-launch Sanity Check

Posted on 06. Sep, 2012 by in Blogs


How do you know if people will like the way your mobile app or Website works? UserTesting.com offers an easy way to identify design problems pre- and post- launch. That’s right. You can find out if you’re going to have usability-related adoption issues prior to product launch. The company can facilitate feedback in as little as an hour.

Founded five years ago by Dave Garr and Darrell Benatar, UserTesting.com offers crowdsourced usability testing by people in the demographic profiles you specify. For a fee of $39 each, you’ll receive a video from each tester (approximately 15 minutes in length) that identifies both red flags and positive attributes. Near real-time feedback enables you to implement a nimble, iterative redesign process.

Of course, it helps to engage a UX expert at the beginning of your project to avoid a false start. Even so, there’s nothing like putting your app in the hands of end users. It makes sense to run the sanity check to:

  1. Validate you’ve developed an exceptional product
  2. Identify tweaks that would make your app a home run right out of the gate
  3. Determine if you need to go back to the drawing board

For the people who leave design to the last stage of product development, you can catch yourself before launching a substandard product that people will ignore in the marketplace. The level of effort needed to rework a product developed under conditions that underestimate the value of design takes serious commitments of time and money. (If this sound familiar, perhaps it’s time to rethink the product design process for the next time.)

UserTesting.com has priced its service reasonably enough that companies can run their apps or Websites through the process a few times if needed. You may as well take the user testing plunge. It costs a lot more to miss the market opportunity because you didn’t have a reasonable way to obtain customer feedback.

As an added benefit, using UserTesting.com may pre-seed the market with your app by putting it into the hands of technologically savvy people who fall right in your sweet spot.

Navigating the Future

Posted on 19. Jun, 2012 by in Blogs


An admiring biographer once claimed that proof of how far-sighted Russian revolutionary Leon Trotsky was could be found in the fact that none of his predictions had yet come true.

An aptitude for seeing well into the future is essential for CEOs and for the long-term success of the companies they lead.  However, there is a fine line between vision and dreaming, and reality is the final arbiter of where that line lies.  I’ve known too many CEOs who stray well beyond that line and stay there way too long.  For some, that mistake is an innocent miscalculation driven by passion and emotion.  For others, it’s a willful or semi-conscious escape (and abdication) from the problems of the present.  Either way, these CEOs squander years of real-world progress and untold money before belatedly stumbling their way back to a more realistic view of the future.

It’s impossible to know exactly where the line between far-sighted vision and dreamland lies, but if you never forget that there is a line and never stop looking for it, you’re more likely to get close.  And he or she who comes closest to it, wins.

Women Owned Startups Get 70% Less Investment

Posted on 07. Jun, 2012 by in Blogs


Yesterday a disappointing statistic drifted through my Twitter stream. Marie Johns, Deputy Administrator of the SBA, told members of Springboard Enterprises that gender makes a difference when it comes to raising capital. Women who lead high tech companies raise 70% less than men.

Curious as to whether that stat stemmed from the fact that there are far fewer women in high tech startups (and therefore get a smaller piece of the total venture capital pie) or if the difference were based on gender itself, I went looking for more detail. An article in Inc. shows that both factors come into play.

In 2010, Y Combinator funded 14 women-led startups out of a total of 208 investments. That speaks to the ratio question. More importantly, women owned companies actually receive less money when funded. And yet, women founders outperform their male counterparts. According to Inc., women:

  • Bootstrap more effectively
  • Have a higher success rate
  • Generate greater long-term profitability

We’ve seen the same outcomes when it comes to putting women on the board. Companies with gender diversity in the boardroom generate 48% better return on equity. This differential is attributed to higher collective, or group, intelligence.

Thomas Malone, MIT management professor, tested the impact of gender diversity by giving teams IQ tests. He proved that teams with the greatest number of women outperformed the teams with the highest collective IQs. “The standard argument is that diversity is good and you should have both men and women in a group,” he told the Harvard Business Review in June 2011. “But so far, the data show, the more women, the better.”

Neuroscience underlies the gender difference in a number of ways. Let’s stick with information processing for now. When presented with new information, men get the gist and women get the detail. This may be a critical success factor when it comes to the startup environment. Extreme resource constraints translate to a wider span of responsibility than people have in more mature, functionally structured organizations. Attention to detail helps get things done and improves quality. The ability to execute effectively enables companies to survive their early years.

I wonder if venture capitalists are paying attention to the improved success rates and financial outcomes women bring to the table. Perhaps a gender clause should become an element of the term sheet. Of course, it’s not that easy. Even if more VCs started promoting gender diversity, people are not interchangeable. You still have to get the right mix of people in order to establish high performing teams. Let’s remember that the positive effect of diversity doesn’t stop at gender.

Elegant Design Turns Mundane Into Must-have

Posted on 22. May, 2012 by in Blogs


The heat of competition rose quickly this spring when Honeywell filed suit against Nest for patent infringement over a smart home thermostat. Looking at the recap reported by techdirt, it appears as if Honeywell has little basis for its claims. It does, however, have cause for concern.

Why would a Fortune 100 company with $36.5B in annual revenue spanning industries as diverse as aerospace, oil refining, and smart grid technologies care about a startup like Nest? If the business principles underlying The Innovator’s Dilemma hold true, Honeywell will not be capable of combating disruptive technologies with innovation of their own. Their only recourse is to use the legal system to slow market share erosion.

By now you might be asking what is so compelling about a new thermostat for your home. It’s beautiful and very simple to use. So is Nest’s website. Tony Fadell, creator of the iPod, applied the Apple philosophy when designing the thermostat. The device learns your behaviors and applies its knowledge to effectively manage energy consumption and the comfort level in your home.

When you get down to it, smart companies begin product and service design with the end user in mind. Sure, using a smart thermostat will help save up to 50% on your home energy bill. Just seeing the device makes you want to install one today.

And that’s the lesson companies must learn in order to compete effectively in a connected consumer world. Deliver a compelling user experience at every touch point. Enough companies have shown what great design can do that being ‘good enough’ simply isn’t good enough any more.

If you struggle with how to begin designing with the customer in mind, you can start by reading the Customer Development Manifesto by Steve Blank. For more detailed guidance, you can follow the customer development model described in The Startup Owner’s Manual.

Startup America

Posted on 01. May, 2012 by in LIFESTYLE


During January of last year, President Obama issued a call to action by launching a White House initiative designed to celebrate, inspire, and accelerate entrepreneurship. The Startup America Partnership is an intentional economic reboot to improve startups’ success rate and accelerate job creation.

Some of our area’s heaviest hitters have accepted the challenge to develop a public/ private program to fulfill the President’s vision. The program’s initiatives include improving access to capital, expanding education and mentorship programs for entrepreneurs, commercializing federally funded research and development initiatives, identifying and eliminating impediments to growth, and facilitating collaboration between large and small companies Combined, these programs provide the resources needed to amplify a startup’s potential at optimal points in its lifecycle.

Last year Startup America Partnership’s Chairman, Steve Case (co-founder of AOL) and Chief Executive Officer, Scott Case (co-founder of Priceline) worked with key members of their team to thoroughly understand the challenges faced by small companies across the nation. Th is research led to tightly defined target markets and value propositions. Subsequently, the Startup America Partnership team built an infrastructure to match resources with needs and establish business connections that small companies could not make for themselves. According to Donna Harris, Managing Director, Startup Regions, the United States has not previously captured key performance metrics for young, growing companies. The Startup America Partnership will begin filling in much needed data to help the U.S.

deliberately improve its economic condition. Th e primary objective for 2012 is to attract 100,000 member companies. So far, 6,000 companies have been qualified. To be eligible for membership, a company must be for profit and have either a founding date of 2006 or later and at least two founders or employees, or a founding date of 2001 or later and at least six founders or employees.

Why are the White House and the Startup America Partnership so interested in supporting this particular business demographic? Small businesses have created 40 million jobs since the early 80s.

In fact, research shows that young, high– growth companies have accounted for all net employment gains over the past 30 years. Alarmingly, the new startup rate has dropped by 23% since 2007. Th e Startup America Partnership is geared toward reenergizing this vital economic engine.

Per Harris, 50% of small businesses fail within the first five years. It follows that the strategies used to accelerate job growth would diff er from those that would improve the success rates of earlier stage companies. Resources have been developed to support three distinct inflection points in an early stage company’s lifecycle: Startup, rampup and speedup.

While entrepreneurs at the idea stage do not qualify for membership, they can search the Startup America Partnership directory to fi nd service providers, events and other information that will help them pre-launch. Narrowing the scope of the problems solved to a very specific target markets helps ensure that program resources are applied as intended.


Harris views the Startup America Partnership as a vehicle to democratize the startup environment. She describes an infrastructure that supports rapidly growing businesses regardless of where they’re located. It’s not uncommon for D.C. area startups to seek West Coast funding. Specifically, Silicon Valley has established a reputation for its vibrant, entrepreneur-friendly ecosystem. Th at practice drains valuable resources from our local economy.

As a result, the Startup America Partnership plans to deliberately create entrepreneur-friendly infrastructure and networks in every state of the union. In fact, a grassroots movement led by local business leaders that supplements the Startup America Partnership has already begun. Startup Virginia and Startup DC kicked off their programs on January 31, 2012 to coincide with Startup America’s first anniversary. Th e Startup MD launch followed on March 30.

Mike Binko, President and CEO of kloudtrack®, and one of the Organizing Board members for Startup Maryland, notes that there are subtle diff erences between the regions. For example, Maryland has a greater variety of business categories and a high density of accelerators and incubators.

The Startup Maryland Board held town hall meetings to understand the regional nuances and designed a program to address local entrepreneurs’ most pressing challenges. Th e Startup Maryland launched with the four key initiatives: 1) resource mapping, 2) capital acquisition, 3) corporate and customer connectedness, and 4) awareness.

Yet the power of the Startup America Partnership comes from inclusion that spans state lines. Startup Maryland is interested in making connections with programs in Pennsylvania, West Virginia, and Delaware as those states’ programs come online. Closer to home, the interstate connections have been made by using FounderCorps as a connective tissue that binds Virginia, Maryland, and the District of Columbia.

FounderCorps was a natural place to start a cross-jurisdictional grassroots movement. Led by Jonathan Aberman, FounderCorps is an established network of seasoned entrepreneurs from Maryland, the District of Columbia and Virginia that “promotes entrepreneurial development by actively partnering with existing organizations to create a supportive infrastructure for high growth entrepreneurship.” Aberman recruited Evan Burfield, Chairman and Founder of Synteractive™ Corporation, to spearhead Startup DC.

A discussion with Jonathan Aberman and Evan Burfield provides insight into the attributes that make the FounderCorps’ connection with the Startup America Partnership so valuable to the Metro DC area. Conversation flows easily as the two men talked about regional challenges and opportunities.

Aberman: “[FounderCorps is] in a position to basically provide the connective tissue so that the efforts work together.” Burfield: “Despite a bad economy, the region has done fairly well based on countercyclical spending by the Federal government. But the train is coming down the tracks. . . There’s going to be a lot of net job loss.”

Aberman: “I work with George Mason University on a program called the Mason Entrepreneurship Initiative. We’ve been working on strategically revamping the tech transfer office there. The leadership at the university sees the same thing. We’ve been very, very fortunate with our [local] economy without having planned what’s next. The idea is to provide as many paths as we can so that when the leaders in our community ask, ‘What should we do?’ there are a number of solution paths in front of them.”

Burfield: “The goal is not to count the number of startups and say, ‘oh good, there’s more.’ For me, what’s exciting about this is creating a system change. Right now you have pockets of vibrant communities doing their own thing and thinking that they’re not connected together. [This degree of disconnectedness means] they’re not working toward maximum efficiency for job growth in the region.”

Burfield is also quick to point out that the startup designation does not automatically signify technology. “It’s important to note that it’s Startup DC, not tech DC. There’s a great DC tech community that’s connecting people just doing tech. . . Our message is certainly technology has to be a part of [the equation] given the mix of talent in the region, but it isn’t about tech. [The Startup America Partnership] is about entrepreneurship, innovation.”


The system changes Burfield references entail a number of significant shifts in the way we approach technology commercialization, funding, and relationships between large and small businesses.

For example, the Metro DC business community holds the greatest brain trust in the country. The people who work at university and government labs have tremendous amounts of expertise with cutting edge R&D projects. Currently, that expertise remains trapped in organizational silos. Aberman is particularly excited by the opportunity to break through those silos. He believes that commercialization of advanced science and world-class technologies developed through federally funded initiatives can lead the way to significant job growth and economic revitalization. His aspiration to embed tech transfer as a natural part of the entrepreneurial ecosystem falls squarely in line with President Obama’s vision.

Successful tech transfer will generate a heightened merger and acquisition rate, which in turn will attract more venture capital to the area. Perhaps the system change will also create a new type of investor. Ten of the 15 wealthiest counties in the U.S. are located in Northern Virginia and Maryland. The outflow of technology from the public to the private sector and crowd sourcing platforms give the region’s affluent opportunities to invest in entrepreneurial ventures they may not have otherwise considered.

Another key ingredient to economic growth includes the formation of relationships between large business and small business. Burfield states, “For me, the major goal is when we have not just the attention of the large corporations in the region, but the active engagement and behavior changes to work more effectively with the startup community. That works to everyone’s benefit. We’re not going out and asking for handouts. The point is the startup community in this region can be tremendously beneficial, not just to the government but to all major industries that are based in the D.C. region.”

Just as mentor/protégé programs benefit both individuals, collaboration between large and small companies offer value to all participants. Buying locally from small businesses will generate much needed revenue for growth. Interacting with entrepreneurs will enable corporate America to view their businesses in a new light. Some of the greatest value will stem from the cross-pollination of ideas that build on the strengths, ingenuity, and creativity of each participating company.

Dan Johnson, attorney, state lobbyist, and entrepreneur had the following to say about his company’s membership in the program. “Startup America is not only a community, it’s a community supported by the President of the United States. It has been a nice psychological boost knowing that the President is rooting for me and that it’s important to the country.”

At the end of the day, whether your company is five days old or five years old, it’s time to get involved. Community involvement helps small business owners find the resources and support they need to achieve far greater results than trying to wing it on their own.

Customer Rage

Posted on 30. Apr, 2012 by in OPERATIONS


Are companies any better at handling customer complaints than they were 35 years ago? A 2011 study indicates that no, they are definitely not.

During 1974, Special Advisor to President Nixon and Director of the U.S. Office of Consumer Affairs, Virginia Knauer, commissioned a landmark study that investigated how companies handle customer complaints. The main focus of this research was a national probability survey of 2513 households (the White House Study) conducted in 1976. This survey profiled the problems American households experienced with products/services and examined, in depth, customer complaint handling behavior.

During the 1970’s before the White House Study was conducted, business generally viewed complaint handling departments as cost centers. For this reason, relatively few corporate resources were allocated for handling customer complaints. Findings from the White House Study, however, changed this point of view significantly. Although the study found that most complaints were not being satisfactorily resolved, it also concluded that satisfactorily handled complaints could produce quite meaningful marketing benefits (continued brand loyalty, positive word of mouth communications, high ROI’s, etc.).


Therefore, during the 1980’s and 90’s American companies began to view corporate complaint handling programs as potential profit centers. This re-evaluation of the worth of complaint handling practices lead corporate America to invest hundreds of millions of additional dollars in this area. The assumption was that this money would be spent on improving complaint handling policies.

The Follow-up
In 2011, Customer Care Measurement and Consulting (CCMC), an Alexandria, VA management consulting and survey research firm, conducted a follow-up study of 1000 U.S. households to determine if the promise of upgraded corporate complaint handling practices suggested by the White House Study had actually been fulfilled.

The 2011 survey replicated the core questions from the original 1976 study and explored such additional issues as customer rage and the fulfillment of complainant expectations. Both studies focused on the most serious customer problem experienced during the past year. The 2011 survey produced a little good news and a whole lot of bad news.

2011 Study Findings
Problem experience. Forty-five percent of the respondents reported experiencing problems with products/services during the past year as compared to the 32% problem rate in the White House Study. The reason for this increase is not poor product quality because, by all measures, product quality is significantly better today than in the 1970’s. Four other reasons, however, probably account for this increased incidence of problems.

Sensationalized stories about customer rage (e.g., both flight attendants and passengers losing control on airplanes) are reported by the media on a regular basis. Just how pervasive, however, is that phenomenon? Sixty percent of the respondents experienced rage (“extremely” or “very upset”) in connection with their most serious problem. For the majority of customers, then, rage has become a significant issue in the new millennium.

Lost Money and Time
The two principal types of damages reported concern lost money and time. When compared to 1976, there was a 22 percentage point drop in lost money damages (from 62% to 40%). On the other hand, lost time increased 51 percentage points (from 14% to 65%.

One cause for this increase in lost time is the nature of the most serious problems reported in 2011. Nineteen percent of today’s most serious problems are related to cable/ satellite TV. Here, waiting for repair service can be a major time sink. Th is product was not a meaningful cause of customer problems in the 1970’s.

For many households, lost time is a more serious issue than lost money. Not surprisingly, lost time is directly associated with customer rage.

The White House Study reported that 69% of the households experiencing problems complained to the company that caused the problem. By 2011, the percent of complaints had increased to 82%. Th is is not surprising given the adoption by American companies of aggressive complaint solicitation policies (800 number call centers, printing company contact information on product packaging, etc.).

Bupkis and double-bupkis
The Yiddish expression “bupkis,” means less than nothing. Unfortunately, “bupkis” characterizes the 47% of the 2011 study complainants who felt that they received nothing as a result of complaining. Not only did they suffer because of their problems, but also they had to waste time in the futile efforts to revolve their complaints. The table below illustrates the “doublebupkis” received by the remaining 53% of the complainants. This table compares what these complainants wanted with what they got. While it might be expected that refunds would not always be offered, non-monetary remedies such as apologies or dignified treatment were likewise in short supply. Here the bad news is that business has spent a fortune establishing supposedly upgraded complaint handling programs only to give their customers “bupkis” when they complain.

Satisfaction with Action Taken
The real bad news, and the biggest surprise of this study, is that aft er spending hundreds of millions of dollars over the last 30 plus years to improve corporate complaint handling programs, satisfaction with the action taken to resolve problems has actually decreased. Today complainant satisfaction has dropped to 21% as compared to 23% in 1976.

CCMC estimates that the revenue at risk as a result of not satisfying complainants’ most serious problems in 2011 exceeds $58 billion. Companies are spending millions to lose billions in future sales.

The marketing advantage of effective complaint handling policies. The only GOOD news reported by this study is that, as in the White House Study, the 2011 data document a significant marketing advantage associated with effective complaint-handling practices. While only 5% of dissatisfied complaints remain brand loyal, 58% of those who are satisfied intend to buy again. This 53 percentage point loyalty advantage should, in most cases, more than off set the cost of satisfying complainants.

Poor Execution of Right Policies
During the last three decades, much of corporate America has adopted a “check off the box” mentality toward complaint handling. Most companies have adopted the right practices but have not executed them effectively. They have not verified whether these polices are working and have, thereby, misled themselves into believing that simply taking action equates with effective policy. The irony is that in many instances spending less money (e.g., increasing first contact resolution) would actually improve performance.

The findings of this study produced both good and bad news. The good news is that satisfactorily handled complaints are still associated with high levels of brand loyalty. This supports the conclusion of the White House Study that effective complaint handling practices can lead to increased profitability. Industry leaders have validated this finding by realizing high ROI’s from their properly executed complaint handling initiatives. In such instances, adoption of “best practices” has had a positive impact on the bottom line. The BAD news, however, is that corporate complaint handling can be a double-edged sword. Ineffective policies lead to decreased levels of brand loyalty and negative ROI’s. Unfortunately, this study finds that, from a macro-standpoint, complaint handling practices have proven ineffective. Levels of complainant satisfaction are lower today than in the mid-1970’s when complaint handling departments were generally viewed as corporate backwaters.

Today, most companies have adopted many of the correct polices but have failed in the execution of these practices. Further, the upgraded investment in corporate complaint handling departments has evidently NOT kept up with customers’ expectations. The challenge in the 1970’s was to convince senior management to invest adequate resources in corporate complaint handling programs. Th is challenge was successfully met, due in large measure to the findings from the White House Study. The 2011 study, however, suggests that this was a Pyrrhic victory.

The challenge for the new millennium, then, is to take the substantial investment made by companies in upgraded complaint handling and actually make these policies work. The overall message for today is the same as it was 35 years ago…

“Do it right, or don’t do it at all.”

What SoLoMo is Missing

Posted on 30. Apr, 2012 by in MARKETING


It’s a New Era in media and marketing, but many companies are missing the mark when it comes to targeting what is perhaps the internet’s most important demographic–that is, the “Wo”

In Max Gladwell’s January 23, 2012, Huffington Post article titled, “The SoLoMo Manifesto: A New Era in Media and Marketing,” he writes, “Social. Local. Mobile [SoLoMo]. These are the sweeping trends in marketing today and for the foreseeable future. In terms of media consumption, they’ve come to dominate consumer attention.” This led me to the question: who exactly are the consumers?

SoLoMo Defined
Before we discuss the consumers, I would like to do a quick rundown of SoLoMo. In very simplistic terms, the place (local) is the physical place/location where we check in with our smart phone (mobile), and our smart phone then connects us to the social world of Facebook (as one leading example), which broadcasts to all of our friends where we are located through an app (social) like Foursquare (as one example). This is where we get those posts on our Facebook status updates like: “Beth just checked in at ____.”

Gladwell writes: “The brand that occupies the place is more fleeting, yet equally important to defining it. The brand is how we know a place. The lat/long or geocode is how computers know a place, and this is where the virtual world comes into play.” In marketing terms, the brand might be the most important aspect of the whole concept because how do we, as marketers, get consumers to “check in” at our space? We must build a brand identity that attracts consumers.

Missing The Mark

This leads back to the earlier question: who are the consumers? As a woman and as an editor at a small, start-up literary magazine where I wear many hats, and as one of them dabbling in the marketing sphere, I started to wonder, “Why did I have no idea what SoLoMo was?” It turns out that I am not just behind the tech revolution, but that many of the articles written about the SoLoMo concept are technical documents full of technical jargon written by men and for men. This last one is the “SoLoMo Manifesto,” written by Rob Reed and has the tagline: “Just About Everything Marketers Need to Know About the Convergence of Social, Local, and Mobile (SoLoMo)” and while it is very informative indeed from a technical standpoint, from a brand marketing standpoint, it is completely gender neutral.

I understand that these writers have a specific audience and tone, and I’m not giving them flack for this. However, there seems to be a key phrase that the creators of SoLoMo are missing: the female consumer.

This is odd if you consider the following data compiled by Aileen Lee in her March 20, 2011, TechCrunch post, “Why Women Rule the Internet.” In it, she states, “Comscore, Nielsen, MediaMetrix and Quantcast studies all show women are the driving force of the most important net trend of the decade − the social web. Comscore says women are the majority of users of social networking sites and spend 30% more time on these sites than men; mobile social network usage is 55% female according to Nielsen.” Women are not only outnumbering men in social media usage, but they are spending more time on the social sites that they visit.


This is important information for businesses, especially if you take into account the social nature of women and how they go about trying new products. According to a different Nielson study, “Women of Tomorrow,” posted June 28, 2011: “Across 22 forms of advertising ‘recommendations from people you know’ is by far the most trustworthy advertising source for women.” Also consider the following statistic about one of the most popular networking sites, Facebook: a Pew Research Study, titled “Social Networking Sites and our lives,” posted June 16, 2011, found the following, “The average adult Facebook user reports that they have 229 Facebook friends.”

Combine the knowledge of female influence on their social network with the 55% female mobile social network user statistic, add in the Pew data that the average Facebook user has 229 friends, and your end result is clear: women have the capacity to be social media behemoths.

The Female Consumer
If the SoLoMo concept relies on social networking, women should be aggressively targeted, especially considering Lee’s following facts about female spending power: “In e-commerce, female purchasing power is also pretty clear. Sites like Zappos (>$1 billion in revenue last year), Groupon ($760m last year), Gilt Groupe ($500m projected revenue this year), Etsy (over $300m in GMV last year), and Diapers ($300m estimated revenue last year) are all driven by a majority of female customers. According to Gilt Groupe, women are 70% of the customer base and they drive 74% of revenue. And 77% of Groupon’s customers are female according to their site.”

If females are consuming and socializing and using their mobile devices more than ever, shouldn’t they BE the target consumer group of this SoLoMo revolution? And females should not only be targeted as consumers, but should be integral in the creation of these SoLoMo marketing campaigns. Women know how other women think, what women want and how to target women.

Creating a marketing plan that will draw women to you (local) in order to generate that integral relationship called brand loyalty with women who will want to share their experience (social) by picking up their smart phones (mobile) to potentially generate a social media force behind your company makes sense. We have seen that women have money to spend and they oft en rely on friends for recommendations, so the next experience that they share with their 229 Facebook friends could be about your company. Being gender neutral is not an option.

The Fallacy of First Mover Advantage

Posted on 25. Apr, 2012 by in Blogs


You work for a startup. Product development has taken twice as long as expected. Market conditions have shifted and you’re certain someone else is working on a similar idea. You feel a sense of urgency to get the product out the door before first mover advantage slips through your fingers.

Sound familiar? If so, perhaps you should take a deep breath and reconsider your haste—64% of first movers fail entirely.

That must mean that just over 1/3 of companies do gain an advantage by shipping first. Or does it? I’d suggest that an ability to execute contributes more to a company’s achievement than the day a successful first mover releases its product.

People tell entrepreneurs they don’t need to develop business plans. After all, your model is going to change anyway, so why waste the effort?

I tend to disagree. While it’s true that you will very likely pivot when testing your ideas about customer need, market size, demand, and other critical success factors, a plan gives you the ability to articulate hypotheses and a structure for testing them. Include soft elements like core values and you have means to assess cultural fit from the time you begin to attract talent.

Unlike the business plans you may have learned to write while earning an MBA, startup plans are not voluminous. They facilitate execution by establishing guidelines, expected performance, and red flag moments. Reach a red flag without achieving expected outcomes and it’s time reassess your assumptions to ensure time doesn’t continue to slip by unnoticed. Reflection on why things aren’t working as expected enables smart pivots in shorter time frames.

When used appropriately, a plan will help the company focus on how to scale earlier rather than later. Consistent, planned growth in all stages prevents wide revenue swings and helps keep the company in the black. Managing growth is an important form of discipline.

Success rarely happens by accident. The idea that being first to market gives a company an advantage is an illusion. Too many other factors contribute to an organization’s ability to win in the marketplace. You can, however, stack the deck in your favor.

Read Great by Choice by Jim Collins and Morten T. Hansen to learn more proven techniques used to build great companies from the ground up.

Lessons Learned from eBay

Posted on 09. Mar, 2012 by in Blogs


This week’s CEO Briefing highlights 8 lessons learned by eBay’s CEO, John Donahoe. You’ve heard most of them before including, “Enduring companies have a strong corporate culture and values.” The lesson that really stood apart from the rest: “Winning is important, but how you win is equally as important.”

Dig a little deeper and you’ll discover that Donahoe has serious courage. He did a turnaround while eBay still delivered strong financial results. Yet, key indicators were trending down because the company had not stepped up to meet significant new demands in the marketplace. eBay would not be the powerhouse we know today without Donahoe’s intervention.

Along the way, Donahoe introduced an interesting core metric called the Net Promoter Score (NPS)*. The company uses a scale of 1 – 10 to measure customer satisfaction. A score of 8 or higher identifies a promoter; 5 or less marks a detractor. Here’s the kicker. eBay ties 10% of senior management’s compensation to NPS improvements.

To take a closer look at how Donahoe turned eBay around, please read the story on ChiefExecutive.

*The idea for NPS originally came from Bain & Company consultant, Fred Reichheld.

The Dashboard Group Aligns Companies For High Performance

Posted on 13. Oct, 2011 by in Blogs


How do you create a high performing organization? It’s a question leaders face day-in and day-out, and all too frequently fall short when it comes to execution. Dave Ramos, Founder and CEO of The Dashboard Group, believes lack of alignment frequently lies at the core of underperformance. While the concept of alignment may seem simple, achieving it is not.

“You have to deal with the elephant in the room,” observes Ramos. “Even in organizations that recognize there’s a problem, fixing it can be painful. For example, it might require you to deal with long-standing dysfunctional interpersonal relationships that have penetrated the organizational culture.”

Misalignment stems from systemic problems that cut across functions, divisions or systems. For example, the CEO says employees are the company’s most valuable resource… but the organization lacks systems to grow talent or reward outstanding performance. Or perhaps the sales, marketing, and product development teams view the world differently and strive to achieve excellence—but not from the same context.

A few seemingly innocuous factors can cause a company to go out of alignment. We may not even notice when they occur, but we do notice that performance plateaus. Consider this. A company has entered a new phase of its lifecycle, yet adheres to its old strategy. Or maybe the founder, who excelled in the exploratory, ‘drill for oil‘ phase, struggles to lead during what Ramos calls the ‘real enterprise phase.’

Another common mistake—particularly for companies struggling just to survive the early years—is lack of focus and resource dilution.

“Companies tend to underestimate what is required to succeed in a new market,” states Ramos. “They tend to overestimate what it takes to do new things and and therefore often pursue too many opportunities at the same time. As a result, they under invest in all of their strategic initiatives. Dabbling is an absolute recipe for destruction.”

So, how does The Dashboard Group help clients kick start their companies to become high performers? They view the organization as an ecosystem, conduct a comprehensive diagnostic, and develop integrated solutions that cut across artificial boundaries. They do not believe you can simply apply a patch here or a patch there and expect the bandaids to resolve larger problems.

The Dashboard Group also helps clients narrow their scope and intensely focus on a core market. It may require the company to prune away underperforming markets or employees and unprofitable customers. Resources made available from pruning are then reinvested in a few new initiatives or doubled down on the client’s best performing products or markets.

The softer side of business also plays a key role in Ramos’ approach. Vision, mission and values supply the foundation for high performance. According to Ramos it’s like building a house. The foundation doesn’t get any credit, but without it, the house crumbles.

High performing companies use the self-awareness established by mission, vision, and values to attract and retain employees that fit the corporate culture. By having a strong sense of self these companies interview for a combination of chemistry and talent. Employees need both to help the organization achieve excellence. The same can be said for finding the right consultant. You must have chemistry and agree with their worldview for the relationship to work well.