How Brands Should Evaluate Startups

May 22, 2012 by (author unknown)

Marketers are overwhelmed, but focusing on these criteria will help you see the forest for the trees when evaluating startups and new technologies.

3ders.org – Jay Leno uses 3D scanner and 3D Printer to replace old …

May 18, 2012 by (author unknown)

Jay Leno’s biggest hobby is car collection, he has a lot of old cars, the only problem is he can nowhere find a spare replacement part. But Jay and all the guys at …
www.3ders.org/…/20120514-jay-leno-uses-3d-scanner-and-3d…

App Stores = Markets; Cloud Platforms = Customer Ecosystems

May 15, 2012 by Patty Seybold

There’s clearly a stampede going on to combine app stores, digital downloads, and cloud storage/back-up as ways to create competing and coopetive ecosystems. Amazon, Apple, Facebook, Google, Microsoft (which just invested in Barnes and Noble’s Nook e-Readers) all now have such similar business models and ecosystem strategies, it’s no longer surprising when one of them makes the next move. Their goal: create a comfy “place” for us to hang out and DO everything we need to do in order to live our digitally-connected lives, from downloading music and videos and books, to chatting with our friends, to keeping our important digital assets, email and files backed up, to strutting our stuff and selling our wares.

In his Forbes article, entitled Facebook’s App Store Heats Up Convergence of Big 5, Haydn Shaughnessy writes:

“Facebook’s App Center will be a mega-shop for Apps from all operating systems, with a rating system based around engagement. Facebook will not take a cut if it directs people to iOS or Android but will be encouraging developers to do more for Facebook, where it will take 30%.

The most remarkable thing to note is the large areas of convergence. Underlying all these developments is, in fact, a converged business model: platform and ecosystems. Skimming this morning’s news reports nobody is questioning Facebook’s ability to sell apps or to replicate Apple’s success as a platform and ecosystem business. Platform and ecosystem businesses seem to be uniquely able to launch major new initiatives, with ease.

Right now the top 5 or six American companies in these respective domains [Amazon, Apple, Facebook, Google and Microsoft] are working their way towards a new corporate form, a new way of organising resources and creating wealth. It pays to take note of it. Platforms and ecosystems will rule.”

~ Haydn Shaughnessy, Forbes Contributor and co-author of
The Elastic Enterprise: The New Manifesto for Business Revolution

It’s true that there’s usually a convergence between these 5 players’ cloud platforms and their app markets. But I believe that it’s important to point out that an App Market or Store is “just” a marketplace. It’s a convenient place to go to find and buy something. That’s not unimportant, but it’s not as compelling as a customer ecosystem that is designed to help us get things done, beyond buying things. We believe that true customer ecosystems probably require cloud capabilities—so we never have to worry about losing “our stuff.” But, in order to truly win the hearts and minds of customers, customer ecosystems also need to make it easy for us to manage our stuff and to get things done. It’s not clear to me that the Facebook ecosystem is doing that yet.

The social side of strategy

May 10, 2012 by (author unknown)

Crowdsourcing your strategy may sound crazy. But a few pioneering companies are starting to do just that, boosting organizational alignment in the process. Should you join them? Read more on the McKinsey Quarterly >

Topics: Organization Strategy

Update your Quarterly feed preferences

What Does "Professional" Look Like Today?

May 9, 2012 by Allison Fine

As the online waters rose, executives at the Susan G. Komen Foundation huddled behind their fortress walls like first-class passengers on the Titanic. The AP broke the story of Komen de-funding Planned Parenthood Federation of America on Monday, January 30th. As the online world took them to task, according to marketing blogger, Kivi Leroux Miller, nearly 24 hours went by before Komen posted anything on its Facebook or Twitter accounts and three days before Nancy Brinker, Komen’s CEO, released a video statement.

Komen’s inaction contrasted with Planned Parenthood, whose facility with social media allowed the organization to respond immediately, on a variety of channels. The difference reflects Brinker’s top-down command and control management style versus Planned Parenthood’s CEO, Cecile Richards, enthusiastic embrace of social media. Richards is an avid Facebook and Twitter user and encourages staffers to do the same using their own voices. As she told me two years ago, “From day one, I said social media was here to stay and I was going to be personally involved in helping us use it.”

According to a Booz & Company/Buddy Media survey released last October of more than 100 large companies, only a third have a senior executive charged with overseeing social media. And just over a third (38%) reported social media as a CEO-level agenda item. There are nearly a billion people on Facebook — just about everyone, that is, except CEOs.

Since 2005, I have spoken to thousands of executives from corporations, government agencies and nonprofit organizations about their discomfort using social media for business purposes. The problem for them isn’t learning which button to push; if that were difficult seniors wouldn’t be the fastest growing segment on Facebook. The real problem is that using social media challenges their basic assumptions of what it means to be “professional.” The definition of professional behavior is an immutable set of behaviors developed early in one’s career.

For most people over forty it means wearing a uniform of some kind, talking in a certain language, carrying a briefcase (or more recently a Blackberry or iPhone), and perhaps, most important, keeping one’s private life private. Gen Y, or Millennials, — late teens to thirty year-olds, — have a vastly different notion of what it means to present oneself to the world wearing their business hat (so to speak.) The huge organizational chasm between Gen Y and Gen X and Boomers, is less a technological problem than a psychological one, and it manifests itself in the use of social media.

Social media’s threat to professional behavior for older generations is often expressed like this:

• We’ll be off message if our organization doesn’t speak with one institutional voice.
• I will be attacked out there by the wingnuts/trolls/nuts.
• We cannot have blog posts and Tweets go up and out with typos in it
• We cannot share plans and ideas in public before they’re fully vetted internally.

These concerns are understandable in a gotcha media world where every misstep is immediately uploaded, “liked”, and tweeted around the world. But as the Komen incident illustrates, hiding behind high walls and wide moats isn’t the answer. Charlene Li writes in Open Leadership, “The question isn’t whether you will be transparent, authentic and real, but rather, how much you will let go and be open in the face of new technologies.”

A new definition of professional behavior is developing in this social world. Here is the transition:

Social media enable people to be their best selves: honest, open, fallible, funny, and connected, but too many people and organizations are still trying their best to imitate automatons. Your organization, reputation, logo and staff are living, breathing entities that need to be out in the world to be effective.

Augmented reality and location services drive growth in MEMS

May 6, 2012 by IDG News Service

The growth of new mobile technologies such as augmented reality and location-based services is driving adoption of sensor devices that can detect environmental conditions such as speed, temperature and direction. The growth of new mobile technologies …
See all stories on this topic »

Developer Week in Review: Are APIs intellectual property?

May 4, 2012 by James Turner

Returning after a brief hiatus due to my annual spring head cold, welcome back to your weekly dose of all things programming. Last week, I was attending the Genomes, Environments and Traits conference (I’m a participant in the Personal Genome Project), when I got notified that WWDC registration had opened up. I ended up having to type in my credit card information on my iPhone while listening to the project organizers discuss what they were doing with the saliva I had sent them. The conference itself was very interesting (although I was coming down with the aforementioned cold, so I wasn’t at the top of my game). The cost to sequence a genome is plummeting — it’s approaching $1,000 a pop — and it has the potential to totally revolutionize how we think about health care.

It’s also an interesting example of big data, but not how we normally think about it. An individual genome isn’t all that big in the scheme of things (it’s about 3GB uncompressed per genome), but there are huge computational challenges involved in relating individual variations in the genome to phenotype variations (in other words, figuring out what variations are responsible for traits or diseases).

While all the West Coast developers who slept through the WWDC registration period lick their wounds, here’s the rest of the news.

APIs are copyrightable, unless they aren’t?

These days, I feel like you need to consider a minor in law to go with your computer science degree. In the latest news from the front, we have conflicting opinions regarding the status of APIs. On the one hand, the judge in the Oracle versus Google lawsuit has instructed the jury they should assume that APIs are copyrightable. As the linked article discusses, this could have ominous implications for any third-party re-implementation of a programming language or other software that is not open source.

Over in Europe, however, a new ruling has stated that programming languages and computer functionality are not copyrightable. So, depending on which side of the ocean you live on, APIs are either open season, or off limits. No word yet as to the legal status of APIs on the Falkland Islands …

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Code to make your head hurt.

For those of you who like to celebrate the perversities of life, it’s hard to beat the International Obfuscated C Competition, which just released its 2011 winners. For your viewing pleasure, we have programs that compute pi, chart histograms, and even judging programs for obfuscation, all written in a manner that will have code reviewers running to the toilet with terminal bouts of nausea.

And speaking of C …

We tend to focus a lot of attention on emerging languages, partially because many of them have novel features, and partially because the grass is always greener in a different language. It’s instructive to step back sometimes and take a look at what people are actually using. The latest TIOBE Programming Community Index, which measures how much code there is out there in each of the various languages, has a new top dog, and it’s our old friend C. In fact, when you factor in C#, C++ and Objective-C, C-related languages pretty much own the category. Java has now fallen to the second position, and you have to go all the way down to sixth place to find a scripting language, PHP.

Importantly, all the hot new languages, like Erlang and Scala, don’t even make the top 20, and you only need half-a-percentage point to get in that list. As much as we like the new darlings on the block, the old veterans still are where most of the action (and money) is.

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Related:

• The next wave of programming languages
• More Developer Week in Review coverage

Ford’s Alan Mulally on the Future of Driving

May 1, 2012 by Michael V. Copeland

NEW YORK — If you are trying to get a bead on what kind of car to buy next, you’d figure asking Alan Mulally, CEO of Ford, would be a safe bet. Should you go hybrid, plug-in-hybrid, clean diesel, high efficiency gas, or all-electric? Mulally doesn’t have an answer for you.

Ford is making bets on all those propulsion systems, because what drivers need and want, versus how global energy markets are going to shake out is far from clear even for a massive auto manufacturer. “We don’t know what is going to be the preferred long-term solution,” Mulally says. “The point of view we have is that we are all going to be paying more for energy worldwide.”

With that as a starting point, Ford is focusing on bringing better fuel efficiency and increased CO₂ reduction to its entire lineup of cars and trucks, whether it’s internal combustion or electricity moving the wheels. “It’s clear we need to invest in all of those because we don’t know which one is going to come along the fastest,” Mulally says. It’s simple economics, he adds.

How people make choices will depend a great deal on how quickly energy prices rise, and whether battery technologies in particular become economic in comparison. “Right now a battery costs $15,000 for a 100-mile range,” Mulally says. “Now, as energy goes up, you can start to make a case for the economics of all-electric. But the most important thing is finding a way to manufacture electric batteries in a cost-efficient way.”

Imagine a sensor that monitors blood sugar and can tell when you are on the verge of being in an unsafe state to drive.

While China has been cranking up its production of lithium ion chemistry batteries in particular, the Ford CEO still sees the U.S. as a potential center for battery manufacturing. “Our ability to design, create, and innovate is incredible; there’s no reason we can’t continue to compete with the best in the world,” Mulally says.

Embedding other technologies in cars is also an area of U.S. focus and Ford’s in particular. Along with efficiency, safety, and smart design, connectivity has become a key requirement of car buyers, Mulally says. Ford, through its partnership with Microsoft, is using smartphones and voice commands as the way to bring a variety of apps and services to drivers. The newest Ford SYNC-equipped vehicles, can field 10,000 voice commands and growing, everything from “directions home” to “what can I see?” and “what can I eat?” Some Ford models can tell you when you are weaving out of your lane, even parallel park your car for you.

Ford engineers are also working on bringing health- and wellness-focused apps to driving. Imagine a sensor that monitors blood sugar and can tell when you are on the verge of being in an unsafe state to drive. Or a sensor that monitors heart rate and can tell you it’s time to take a break from especially intense driving conditions. “Think of it as the end of road rage,” Mulally says.

On the subject of driverless cars, Mulally, who spent decades in the aerospace industry, is very clear on the future.

“The driver will be responsible,” he says.

If you parse that carefully, that doesn’t necessarily mean the driver’s hands will always be on the wheel. But as the aerospace industry has found no amount of automation is a substitute for an experienced pilot when it comes to anticipating and correcting for a potentially dangerous situation. “There will always be a person responsible for driving that car,” Mulally says.

What Do Consumers Really Want? Simplicity

May 1, 2012 by Karen Freeman, Patrick Spenner and Anna Bird

This post is the first in a three-part series

You’re probably familiar with the purchase funnel, invented in 1898 by the colorfully named St. Elmo Lewis: he proposed that consumers go from awareness to interest to desire to action, gradually reducing the number of options or brands they consider along the way. This has been adopted, with some changes, as the standard across industries. But the funnel model is fading. Decades ago, consumers may have methodically winnowed their choices as the funnel describes. But today’s consumers, barraged by information, are adapting their shopping habits to cope with the noise — and that has profound implications for marketers

In a survey of 7,000 consumers worldwide, we found the funnel is no longer the most common purchase path. In fact, only one third of consumers now use the funnel approach when they shop. Why the decline? The biggest reason, our research shows, is cognitive overload. Consumers are overwhelmed by the volume of choice and information they’re exposed to, and marketers’ relentless efforts to “engage” with them.

Their response to this overload has been two-fold: About 30 percent of consumers now anxiously embark on an open-ended purchase path, adding and dropping brands, caught in a loop and compelled to continue researching alternatives. Meanwhile, another 30 percent abandon the considered search altogether and simply zero in on a single brand. We call this latter path the “tunnel.” In our survey, the majority of tunnel purchasers were buying the product or service for the first time, so this wasn’t an expression of loyalty to a particular brand; rather it was a response to overload, a way to simplify what’s become a frustratingly complicated process. Either way, these 60 percent of consumers are responding to the bombardment in ways that can lead to poorly considered decisions — or no decision at all.

At first blush, the tunnel approach may seem like an efficient strategy that benefits consumers. And it may on occasion. But there’s an important downside: Have you seen the “I want an iPhone 4” video (warning, strong language)? In the animation, a customer insists she wants an iPhone even as the store clerk repeatedly tells her about better alternatives. An electronics store employee made the video to mock Apple fans’ single-minded pursuit of iPhones with no regard for the superior features and benefits of competing products. But that’s precisely the reaction consumers are having to cognitive overload in all purchase categories: self-imposed simplification of the decision process.

Brands suffer as well because tunnel purchase means tunnel vision. What do you do if your product is not the iPhone 4? Well, the fact that these changing purchase behaviors are a reaction to cognitive overload suggests a smart response. Because marketers have some control over the customer’s purchase experience, they can appeal to consumers by, simply, making it simple for them. In fact, we found that the single biggest driver of “stickiness” — customers’ likelihood of following through on a purchase, buying the product again, and recommending it — was, by far, “decision simplicity,” the ease with which consumers can gather trustworthy information about a product and confidently and efficiently navigate their purchase options.

The bottom line: These days making a purchase decision easy is what makes customers choose your brand.

Read our HBR article here to see how savvy brands are making it easy for consumers to navigate and trust information, and weigh options, on the path to purchase. That’s the winning formula for making consumers stick in today’s chaotic marketplace. Or, you can watch customers tunnel right by your product on their way to a competitor’s offering

Learn how simple — or complex — the decision journey is for your customers with this decision simplicity quiz.

Web 2.0 Is Over, All Hail the Age of Mobile

April 30, 2012 by (author unknown)

When they look back at this era, Internet historians will mark Facebook’s Instagram acquisition as the symbolic moment when the Great Shift was confirmed. Significantly, it also came soon after Steve Jobs’ death. The device that Jobs created had, within the space of five years, allowed a 551-day-old company with 14 employees to become worth $1 billion.

The Scarcest Resource at Startups is Management Bandwidth

April 28, 2012 by Mark Suster

When you work inside a startup with lots of clever and motivated staff you’re never short of good ideas that you can implement.

It’s tempting to take on new projects, new features, new geographies, new speaking opportunities, whatever. Each one incrementally sounds like a good idea, yet collectively they end up punishing undisciplined teams. I like to counsel that the best teams are often defined by what they choose not to do.

Let me explain.

As a VC I regularly meet with companies and listen to their plans. It’s a very common occurrence that a young startup with sub 20 staff and sub $2m in financing is racing around doing too many things. This level of complexity always worries me. A significant number of the companies I meet with get some form of feedback from me that:

“I’m a bit worried that you’re doing too many THINGS. You run the risk of being a mile wide and an inch deep. It’s hard enough to do X really well and succeed. I’m not sure how you do all these other things and yet I think they may end up being a distraction to X.”

I already know your response. Trust me. I hear it every week

“Yeah, but I’m just going to execute this [channel sales deal, international license of my product, new industry, new operating system, biz dev deal] and then it will pretty much run itself.”

It never does. That channel deal that you thought would take no times ends up burning scarce calories. The 3rd-party tries to sell your software – they just need your help with tech assistance to close the deal. They just need you to update your marketing materials. They got your last version working but since your latest release they couldn’t get it to work. That test you did on launching a RIM version of your product – it was only beta – now has 20 users who need a patch because it’s not working properly.

Every extra set of features that you added that served one narrow use case end up being features you need to support in future releases adding complexity to future development, usability testing, regression testing, etc.

Every team I fund comes across as laser focused on their core mission.

My advice?

I always tell teams I meet with, “The scarcest resource in your company is management bandwidth. Spend it wisely.”

Every company is built by a team and every team member matters. But as you know, a few key people in any business have disproportionate impact on the company’s ultimate success.  And nobody is more important in this regard than senior management. These people need need to be hyper focused on those things that matter the most to the company’s success. It’s why I don’t invest in Conference Ho’s.

Examples from discussions I’ve had this month that might resonate with your internal debates about how to prioritize

• We are giving a version of our product to a team in Europe who will start selling our product internationally
• We are signing up a channel partner to sell our product since we haven’t scaled our internal telesales team yet [yes, we know that they don't have experience selling IT, but they have customer relationships]
• We’re going to put a guy on the ground in the UK to address early leads we’re getting from ad agencies there [true, we haven't thought about employment laws, taxation, currency management, etc.]
• I know our product seems complex but we felt we needed to test lots of features to be sure we knew what would resonate with users … or … we aren’t committed to features x, y, z yet but we know our competitors are planning to so we wanted to be first to market
• We need to hire a team in financial services now to address the needs of that industry [yeah, I know we don't yet have big customers there. ok, I know our product isn't yet verticalized. still, we need to start now or we'll be behind.]

And so on. Trust me – each additional complexity you add before you’re ready decreases your probability of being truly excellent at the things you want to do extraordinarily well.

Instagram didn’t rush to Android. They also didn’t do video. They were truly excellent at what they did do.

What do you want to excel at? How will today’s “toe in the water” initiatives distract you or take your management’s time or attention off of your core business? How likely is your, “won’t take too much time” initiative to come back and bite you in the butt?

Beware. The best teams are hyper focused.

Image courtesy of Fotolia

** A note to readers. Sorry if you received an email with a draft version of this post. I had some problems with my hosting company. They were testing out what the problem was and accidentally hit publish on a draft post.

New or improved: What consumers really want

April 27, 2012 by (author unknown)

Do companies require radical innovations to woo consumers? New research suggests…no!

Strategy, Context, and the Decline of Sony

April 25, 2012 by Sohrab Vossoughi

Sometimes it’s useful to be reminded that a great strategy is only great in context. From the early 1980s and into the 90s, Sony’s was great. The unrivaled master of the consumer electronics world, its name was synonymous with cutting-edge technology, sophistication, and desirability. People had a collective vision back then of a thrilling yet humane future, and Sony’s hyper-capable, slightly fussy gadgets were its clearest expression. It was much more than just the Walkman and the Trinitron—everything the company made was of impeccable quality, satisfying to hold and intricately detailed in its functionality.

That last statement is still true today, but everything else has changed. Sony still makes exquisite products, but fewer and fewer people get excited about them. The strategy address recently delivered by the corporation’s new CEO, Kazuo Hirai, earned press coverage that verged on mocking, with The Wall Street Journal noting that the brand’s “once-sterling cachet has deteriorated,” and The New York Times going further, placing Sony in “a fight for its life,” and accusing it of “an astonishing lack of ideas.”

Both observations are correct, but they only hint at the underlying question: why is the strategy that once served Sony so well now failing so badly? It’s not as if its cameras now take fuzzy pictures or its boom boxes fall apart after three months. And the market for consumer electronics is larger than it’s ever been. The Times article rightly observes that Sony’s current product line is crowded and confusing, but offering customers a wide array of choices was fundamental to Sony’s success in the past. What changed?

Part of the shift is technological. Apple’s iPhone—the product often described as getting everything right that Sony got wrong—only comes in one current model and two colors, yet it’s tremendously customizable. With so much of the experience coming from the software, not the hardware, consumers aren’t using a product designed for them; it was designed by them. This is an especially powerful offering because it replaces the single moment of instant gratification—buying the perfect camera, TV, or phone—with dozens of such moments. Every time they install an app or download a song, users are getting a customized experience with an emotional impact on par with the one-time purchase of a product.

This suggests a more fundamental explanation: consumers today care more about the experience, but Sony is still focused on the product. It’s gotten trapped by its own past success. In the early 80s, simply delivering technology in a usable form was still the biggest challenge, and Sony got it right before anyone else. It had an astonishing ability to find the next technical hurdle—a brighter TV, a smaller tape player, an integrated camcorder—and leap over it with grace, before its competitors even thought to try. In an industrial, product-oriented economy, this was enough. Every year saw new products with unprecedented capabilities. As long as it could do something new, we didn’t seem to care what kind of experience we had using it. Plowing through 70-page manuals and fussing with Dolby II and Metal/Non-Metal switches was just part of the deal.

In the experience economy, these expectations are reversed. Technology is a given, and the question of “what are the specs?” has been replaced by “what is it like to use?” Sony’s expertise at making the next great thing has been matched by companies like Samsung and LG, and soon enough, they’ll all be caught by increasingly sophisticated Chinese manufacturers. Without modifying its business model, Sony has been left behind by a world that’s changed its relationship with technology.

What’s tragic is that Sony still has all the resources to execute well on a new strategy. Its engineering capabilities are impeccable, its R&D resources are highly developed, and it has massive amounts of high-quality media. The success of the Playstation shows its ability to deliver a good experience through an integrated ecosystem of products and content. But the Playstation is now just another platform struggling to keep up with innovative alternatives like the Wii, Xbox, and Kinect, and it’s been years since Sony’s other divisions unveiled a real game changer.

What’s missing is the strategic vision to emphasize the delivery of powerful and resonant user experiences. Mr. Hirai acknowledged several times the need for the company to change, but the goals he stated were still hardware focused: sell this many smartphones, that many camcorders. The user is still missing in this equation, as is a sense of what Sony stands for, and what its vision is for an integrated experience. For Sony, it may be too late.

For other brands, there may still be room for change. Every industry has its Sony, still trying to get ahead by solving a problem that’s already been solved. But every industry also has its Virgin Atlantic, its IKEA, or its Procter & Gamble: the major player that continues to innovate. Even Microsoft has shown signs of sensitivity to user experience in its latest mobile operating system.

There’s nothing magic about innovation, just as there’s nothing magic about technology. Both are hard work, but as Sony has shown, all the hard work in the world won’t matter if you’re working toward a strategy that was framed for an another era.

What If Web And Mobile Apps Are Like TV Shows?

April 21, 2012 by Fred

I was having lunch with a veteran of the entertainment and the video game business this past week. It was an interesting and wide ranging chat. One of the things we discussed that stuck in my mind was the thought that web and mobile apps might behave more like TV shows than traditional software applications.

I’ve watched my kids go from myspace to facebook to instagram over the past seven years. And who knows what social app will be their “go to app” in five years. This has always been the case in videogames. Farmville to Cityville to something else. Words With Friends to Draw Something to something else.

This round trip from nothing to everything to nothing again is also true at some level with many tech companies. Digtal Equipment Corporation was founded in 1957 and shuttered in 1998. RIM was founded in 1984 and in all liklihood will be gone before the end of this decade. Same with Sun Microsystems, Silicon Graphics, and many more iconic tech companies.

This concern or observation depending on where you sit has wide ranging implications for valuations, returns, and many other aspects of the startup economy. Companies are worth the net present value of their future cash flows. Said another way, if you knew that a company was going to earn $1mm a year for the next ten years and then be shut down, there is no way you’d pay more than $10mm for that company and certainly you’d pay something a bit less than that.

There are web and mobile applications that seem more immune to the “here today gone tomorrow” concern. Utilities like search, email, calendar, document store, etc feel less likely to be subject to this issue. YouTube also feels fairly secure. But purely social apps, the ones that depend on having your friends on them, seem quite vulnerable to a mass exodus. RIM’s demise among my kids’ generation had more to do wtih everyone leaving BBM than anything else. For as long as all of their friends were on BBM, they all wanted to be on it too.

Network effects are powerful in both directions. They can help you grow exponentially. But when they are going against you, they work just as fast. Myspace’s decline was mind blowingly quick. RIM’s has been as well. Who is next?

I am not writing this post to pour cold water on the internet sector. There are so many amazing things happenning right now. We are investing actively and agressively and are not the least bit bearish.

But it is important to understand the entire life cycle of what you are investing in. If you are playing a game of musical chairs, you have to know that’s what you are playing. Or you will be the one left standing with nowhere to sit. And that sucks.

Managing a Virtual Team

April 16, 2012 by Mark Mortensen and Michael O’Leary

Teams that are geographically-dispersed, or virtual, have now been used and studied for more than three decades — yet we all still wrestle with how to get them right. Managers frequently ask for best practices for managing their global teams, and recently we’ve noticed some common themes. Here are the three questions that keep coming up again and again, and what the research tells us about how to address them:

1. When and how often do we need to meet face-to-face (FTF)?

Despite the appeal of completely virtual teams, most team leaders try to convene their teams for face-to-face meetings at some point — leading them to ask how often and when should they do so. We share two robust findings to consider when planning face to face meetings.

First, research by Maznevski and Chudoba, Carmel, and others finds that FTF interaction is especially important early in a team’s life, particularly when the team is comprised of people who don’t already know each other. “Early,” however, doesn’t necessarily mean “first.” Having some initial virtual interactions before a first FTF meeting can actually enhance the benefits of that first FTF meeting by allowing team members to focus on things like who has what task-related expertise before they are influenced by the potential biases that FTF interaction can trigger. Then, the first FTF meeting can be used to establish the work practices the teams will need to effectively collaborate when the pressure mounts.

Second, Maznevski and Chudoba also found that repeated FTF meetings are best when occurring at predictable times and intervals. This allows team members to plan their time and interactions, reserving discussion of certain complex or delicate issues for those in-person interactions. As a result, teams with a predictable rhythm of meetings outperform those who choose to meet “as needed” — even if they have less FTF interaction overall. So FTF meetings should occur early and regularly.

2. What is the best technology solution for my team?

With the relentless advance of technology, many managers ask us which platform they should use to support their virtual teams. As any suggestion we make will be outdated before the pixels are displayed — we encourage managers to focus on the criteria that shape their daily behavior. We tell them: Ask yourself, why do we rely so heavily on phones and e-mail — technologies that haven’t fundamentally changed much since they were introduced? We rely on them day in and day out because they provide the communication trifecta: simplicity, reliability, and accessibility.

• Simplicity: neither require complex setup time or a steep learning curve — as soon as we have dialed a number or entered an address, we are able to focus on the message, not on the medium. Remember, rich interactions don’t require rich media.
• Reliability: despite the occasional service interruption, we spend very little time worrying about whether our messages will get through to their intended targets.
• Accessibility: phones and email both work just about everywhere we might want to use them — meeting rooms, field offices, airports, even our favorite coffee shops.

In the era of feature-creep, where each new version of a technology is marketed on the basis of countless incremental bells and whistles, remember: each minute your team members spend trying to get the slick new system up and running, bringing it back up after a crash, or unable to access it from a field office brings them that much closer to throwing in the towel and picking up the phone.

3. How do I coordinate work among dispersed members?

Many managers have recounted variations of the same story: they received an eagerly-anticipated hand-off from their distant colleagues only to discover that the work bore little resemblance to what they expected (and were counting on). The net result was wasted effort by their colleagues, unanticipated rework for them, and frustration all around. They ask us: “Why does this keep happening, how can I avoid such coordination breakdowns?”

People have evolved to become extremely good at dynamically adapting to our social environment. In teams, we constantly synchronize and modify our actions and expectations to keep them aligned with those of our collaborators. Unfortunately, this is precisely what distributed teams are bad for. Cramton’s study of dispersed teams found that dispersed team members lack a common, shared understanding — critically necessary for such adaptation. Making matters worse, Hinds and Mortensen found that when distributed, we tend to engage in relatively little of the spontaneous and informal “water-cooler” communication that both promotes shared understanding and is the vehicle for adaptation.

So managers of virtual teams should have dual, complementary objectives: structure and socialize. First they must shift their teams’ work practices away from the dynamic adjustment outlined above towards more structured coordination. Clear team-level work processes, output requirements, and group norms reduce the complexity of virtual team coordination from coordinating efforts across multiple sites to aligning one’s efforts with a single, consistent set of expectations. Second, as the speed of today’s economy means no team — collocated or distributed — can eliminate all such dynamic adjustment, virtual team managers also work to support and facilitate dynamic adjustment when it’s required by promoting and encouraging informal interaction.

This post is part of the HBR Insight Center on The Secrets of Great Teams.

Netflix Never Used Its $1 Million Algorithm Due To Engineering Costs

April 16, 2012 by Casey Johnston, Ars Technica

Netflix awarded a $1 million prize to a developer team in 2009 for an algorithm that increased the accuracy of the company’s recommendation engine by 10 percent. But it doesn’t use the million-dollar code, and has no plans to implement it in the future, Netflix announced on its blog Friday. The post goes on to explain why: a combination of too much engineering effort for the results, and a shift from movie recommendations to the “next level” of personalization caused by the transition of the business from mailed DVDs to video streaming.

Netflix notes that it does still use two algorithms from the team that won the first Progress Prize for an 8.43 percent improvement to the recommendation engine’s root mean squared error (the full $1 million was awarded for a 10 percent improvement). But the increase in accuracy on the winning improvements “did not seem to justify the engineering effort needed to bring them into a production environment,” the blog post said. By that time, the company had moved on anyway.

When Netflix announced the contest to improve the service in 2007, its business was centered on DVDs, which are dealt with by customers in periods of days or weeks and provide little granular data. Now that Netflix’s primary offering is streaming, it has access to much more information: “streaming members are looking for something great to watch right now; they can sample a few videos before settling on one, they can consume several in one session, and we can observe viewing statistics such as whether a video was watched fully or only partially,” reads the post.

This doesn’t seem like much data, but it broadly affects the full screen of personalized recommendations a user might see on their Netflix home page. If a user begins a movie from “Imaginative Time Travel Movies from the 1980s” but quickly closes it, the homepage could shuffle that category down and place a new category at the prime top position that still speaks to the customer’s watching history; something less sci-fi and more 1980s, or vice-versa.

(Mostly) gone are the days that customers would fill their DVD lists with artsy indie films or all of the Academy Award-winning documentaries they could, only for them to remain in queue purgatory. Netflix Watch Instantly is about the here and now, and Netflix is priming to respond to that time frame.

Matterport's scanner can create a 3D model from anything …

April 10, 2012 by Sarah Mitroff

3D printing is turning heads these days, especially with do-it-yourselfers. Y Combinator startup Matterport has invented a small scanner, pictured above, that can scan any space or object and create a 3D model.
VentureBeat

Apple Invents a Killer 3D Imaging Camera for iOS Devices

April 10, 2012 by Patently Apple

Apple has invented a killer 3D imaging camera that will apply to both still photography and video. The new cameras in development will utilize new depth-detection sensors such as LIDAR, RADAR and Laser that will create stereo disparity maps in creating …
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The Dangers of the Minimal Viable Product

April 9, 2012 by Scott Anthony

A movement originating from the United States’ West Coast has sought to transform the creation of new businesses from an art to a science. The intellectual leader of the movement is Steve Blank, a serial entrepreneur who now teaches at Stanford and the University of California at Berkeley. One of Blank’s disciples, Eric Ries, turned his wildly popular Startup Lessons Learned blog into The Lean Startup, one of 2011′s best business books.

I’m a huge fan of this work and suggest that all innovators study the movement closely. One area that deserves particular attention is the notion of the minimal viable product (MVP). The concept is pretty simple. Because it’s next to impossible to be sure that your idea is good until you bring it into the marketplace, don’t waste time trying to fine-tune a product that is destined to be wrong. Instead, put something “good enough” in the marketplace. Let real customers use the product and learn from their feedback (Henry Mintzberg dubbed this process “emergent strategy” in an influential 1985 article [PDF]).

Sometimes, though, a Minimal Viable Product turns into a Mediocre Value Proposition. A company might introduce a product in the marketplace. A few customers find it interesting (you can always find a few customers). Results fall short of expectations, but the company says, “Well, it’s just a minimal viable product for learning.” The company makes a few tweaks, scales up spending . . . and falls flat on its face.

Part of me wonders if this isn’t what happened to Maghound. In late 2008, while prepping for a presentation to some magazine industry bigwigs, a colleague happened on a new venture that had been recently launched by Time, Inc. — “Netflix for magazines” — where consumers could get different magazines every month without having to have a fixed subscription to those magazines. Sounds great, doesn’t it?

Earlier this year, Maghound shut down. One commentator said that it’s a clear sign that the “Netflix of anything” model doesn’t work. I think it shows the limitations of a “good enough” offering.

Maghound’s catchy idea and relatively simple signup seemed attractive. After all, I often would pick up random magazines at airports and enjoyed flipping through esoteric titles left behind on planes or in doctor’s offices. But after I signed up for the service, it took forever for a title to arrive. Instead of changing titles on the fly, it took weeks before Maghound’s system registered a change so I could get a new magazine. Nor was there anything approximating Netflix’s recommendation system to help steer me to surprising titles I might like. After a few months, I cancelled my Maghound membership.

“Good enough” is a great way to start the innovation journey because it enables learning in the most important laboratory of all — the marketplace. But it’s hard to build a compelling business with something that’s just barely adequate. Customers might be intrigued enough to try it once, but they won’t come back.

How do you make sure your minimal viable product isn’t hiding a mediocre value proposition?

1. Ensure you have the right expertise on your team. Depending on your industry, that might require excellence in design, programming, chemistry, sales, or dozens of other areas. Raw potential can develop into world-class talent, but the portraits of most successful startups feature some gray-haired people who have “been there and done that.”
2. Think beyond the product to the full offering and business model. Competitive advantage comes from innovative ways of creating, capturing, and delivering value. Success requires fine-tuning more than features and functions.
3. Act on the learning. One of the biggest warning signs for a new venture is a significant gap in product releases. An even bigger warning sign is when there isn’t any plan to introduce an upgraded offering. Minimal viability descends quickly into mediocrity if there isn’t an actionable plan to act on the learning.

Building mediocre products has never been easier. Building great products and, more importantly, great businesses, remains challenging. By all means start with something that’s just good enough to garner feedback from the marketplace. Just don’t stop there.

Facebook Eats Instagram: Consolidation Time in Social Networking?

April 9, 2012 by Robert Hof

Consolidation is nothing new in social networking. In March, Twitter bought the blogging platform Posterous. Google has done a number of social acquisitions in the past couple of years, most notably the $200 million purchase of Slide, though it did little with it. Fading Hi5 sold out to Tagged in December. And of course, MySpace sold out eons ago to News Corp.