Joho the Blogbusiness Archives - Page 2 of 21 - Joho the Blog

March 28, 2012

The Gettysburg Principles for keeping your customers

I’ve got a post at the Harvard Business Review site about what I’m calling (not too seriously) The Gettysburg Principles. The point is that you can keep your customers buying from you if your business is of your customers, by your customers, and for your customers. “Of” means that your business is made up of people like your customers. “By” means that your customers are contributing to the creation of your product. “For” your customers means you put them first. These three terms give a handy way of analyzing why customers stick with some businesses even if they have to pay a bit more or make some other adjustments.

Anyway, there’s more over at HBR…


January 3, 2012

[2b2k] Marketplace Tech on Too Big to Know

Today is the official launch of Too Big to Know. Yay!

Marketplace Tech ran a 4 minute interview with me about it this morning. More interviews etc. are coming up, including on WNPR (Connecticut public radio) with Colin McEnroe at 1 pm today.

I will, alas, be noting media/marketing stuff on this blog over the next few weeks.


November 2, 2011

Social media at work — top down, bottom up

A Cisco study finds that when deciding on job offers, a startlingly high number of college students and recently employed grads value access to social media at work more than salary. And an article by Ann Bednarz at Network World finds that “[e]ven some of the most buttoned-down institutions are rethinking bans and relaxing access to social networks and social media sites.”

So, it looks like everyone should be happy for a change.


May 31, 2011

[berkman] Miriam Meckel on communicating trustworthiness

Miriam Meckel is giving a Berkman lunchtime talk on “Communicating Trustworthiness: Drivers of Online Trust.” She will present research she has been doing at U. of St. Gallen along with government and some businesses. She’s investigating how trustworthiness is communicated, and what the initial drivers and cues are. She’s going to look at the changing conditions, some basic ideas on initial trust formation, then her study, and then the cues identified in initial trust formation.

NOTE: Live-blogging. Getting things wrong. Missing points. Omitting key information. Introducing artificial choppiness. Over-emphasizing small matters. Paraphrasing badly. Not running a spellpchecker. Mangling other people’s ideas and words. You are warned, people.

Users’ willingness to provide data about themselves depends on some sort of trust. There’s been much discussion about this, including the importance of preserving privacy. For example, Facebook restricted info about users to the user’s schoolmates, but over time it has become far more permissive. (See here for article and diagram.) Both Facebook and Google have said things indicating they believe our attitude towards privacy has changed. E.g., Eric Schmidt: “If you have something you don;’t want anyone to know, maybe you shouldn’t be doing it.”

What is trust? Miriam provides three definitions, each of which involves vulnerability. When we trust someone online, we understand we are making ourselves vulnerable in various ways. Trust enables us to manage the complexity of our social world, reduces the cost of negotiations, facilitates the adoption of new technologies, and reduces perceived risks. Initial trust is especially important since you can lose a customer forever by screwing it up.

In her study, they interviewed 23 online businesses active in Germany. They also did in-depth interviews with 43 users representing a range of socio-demographic sections. From this they derived a model of nine trust drivers: Reciprocity and exchange, proactive communications, user control, brand, third party endorsements, design of user interface, offline presence, technology, and customer service. Then they did a quantitative survey of German users to find out how the different factors are applied to diff business models. 11,000 users from across socio-demographic segments were invited to participate in an online survey for a little money, with a response rate of 12%.

She goes through the nine components of trust:

Reciprocity explains about 35% of the variance of the data. The mutual relationship of customer and organization is crucial. Users are willing to hand over personal info, if they know what they gain from it, if it is transparent, and if both sides benefit.

Brand and reputation: A well-known, establish brand helps build trust. If it has a large customer base, it is perceived as more reputable. You also need a professional feel for the web site.

User control: Users want to know who will have access to their data. Ask permission.

Proactive communications. [missed it. sorry]

Customer service: Multiple ways to reach a person. Provision of different payment methods.

Offline presence: The existence of physical stores helps build trust. Show a photo on your web of your brick and mortar store.

Technological reliability. This can be an issue when your service involves third parties.

Third party endorsements: Not only are seals of approval helpful, but so is having a high search ranking for third parties.

The next step is how these factors are differentiated by B2C business models. Only four factors turn out to be relevant across the board: reciprocity, third party endorsements, user control, and technological reliability. Miriam looks at online shopping, online banking, etc., to see which factors are relevant [but I can’t keep up with my typing. sorry] It seems that for building trust-based relationships with potential clients, you have to have fair communication, mutual benefits signaled, privacy and security policies being displayed, clear T&C’s, engage in issues mgt to follow what is being said about you on the Web, explain the business model and data needs, explain the flow of info to third parties and what the policies are, communicate third party endorsements, engage, peer groups and communities, bring in your offline reputation, and consistently apply corporate design with good design.

Some implications: 1. Users are more willing to trust large, well-established and popular online services. High search-engine ranking can be considered a trust measure.

2. The visual appearance counts.

3. Reciprocity is very relevant in all online transactions.

4. Offline presence, technical reliability and customer service have barely been researched yet.

5. Organizations need a strategic approach for communicating trust to their stakeholders. Take an integrated communication approach, including issues and risk management. They should communicate proactively, in a conversational tone, and transparently.

What not to do? Don’t be Facebook asking Burson Marsteller to find bloggers who would attack Google.

Q: [me] Customer ratings? And the presence of customized trust mechanisms as at eBay and Amazon?
A: Third party endorsements include customer ratings. But we surveyed a represented group of German users, not ones as sophisticated as others, plus there may be cultural differences.

Q: Is your work ethical? An evil company can read your work and figure out how to appear to be ethical. Also, Germany has stronger regulatory protection, which change the signals
A: Yes, companies could fake being trustworthy.

Q: How about SSL?
A: The awareness of the need for SSL is frighteningly low.
Q: Anyone care about authentication certs?
A: [general laughter]

Q: Would the same trust drivers be applicable in news sites and other such non-sales sites?
A: Just in parts. [I can’t read her table because I’m too far back :( ]

When you look at the erosion of privacy caused just be clicking on opt-ins, you get to a point where you just accept whatever the terms are and however they’re changed.
A: People don’t read privacy policies when they’re changed.
Q: Maybe it’s that when the privacy policy looks impressive, it’s a signal of the quality of the service. But, the key question is whether people who say privacy policies are a trust driver actually read them.
Q: There’s some survey support that most people mean think that a privacy policy is there to protect your privacy. [general laughter]

Q: [me] To me, third party endorsement means you get celebrities or associations or other companies to endorse you. But the real trust-driver for me frequently is peer endorsement. Maybe it would be worthwhile to separate those two, especially since businesses need to do different things to gather other companies’ endorsements and to gain a good reputation among peers.
A: Yes, that would be interesting.

Q: What supersedes trust?
A: There may be the desire to be “in” as opposed to “out.”
Q: There are network effects are. How many of friends have to join before I throw away my privacy cBerkman

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March 21, 2011


Foursquare’s general manager, Evan Cohen, is giving a talk at the ILM conference I just spoke at.

NOTE: Live-blogging. Getting things wrong. Missing points. Omitting key information. Introducing artificial choppiness. Over-emphasizing small matters. Paraphrasing badly. Not running a spellpchecker. Mangling other people’s ideas and words. You are warned, people.

He says there have been 381,000,000 check-ins so far. In every single country. The last country to check in was North Korea. The biggest single event was the Rally to Restore Sanity. “The most basic user experience is simply when friends check-in to their current location to find their friends.” “We help engineer serendipity” in which you discover a friend is nearby.

Their value proposition: Discovery, encouragement, and loyalty.

Discovery: They want to push people out into the real world. They’ve just launched an “explore” tag, a recommendation engine. It uses info about what your friends like to do, what people like you like to do, what people are saying in the “tips” review feature, etc. “We want to be like that best friend who knows every cool bar in Chicago, or every restaurant…”

Encouragement: Use gaming mechanics to get people to do what they wouldn’t have done otherwise. The mayor races have become really competitive. If someone loses it, they’ll go back to the place over and over. Their badges also encourage people to go out. E.g., go out to the gym a few times a week and you’ll get the gym rat badge. They have also improved their leader board. The Ambassador program enables users to bring merchants onto Foursquare.

Loyalty: They encourage merchants to offer rewards of various types. They’ve relaunched this part of the platform: easier for merchants, for users, and new “specials” types. They’re now offering “flash specials” to drive traffic when the place is under-utilized. Not all specials are discounts. “It’s an experience.” They also have a “friends special” that only works if you show up with some number of friends. Over 250,000 venues have verified on the merchant platform. Merchants have done creative things with Foursquare. Even when Starbucks offered a mere $1 off a frappucino to the local mayors, checkins jumped by 50%. “It’s about the experience and recognition as much as anything.”

They have a full and easy API, modeled on Twitter’s.

[I find Foursquare fascinating. To the users it’s a game. To the merchants, it’s a form of marketing. And as a blending of the virtual, the real, gaming, and marketing, it’s amazing.]

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February 10, 2011

[misc] The US GAAP Taxonomy is Miscellaneous

Well, here’s an application of some of the ideas in Everything is Miscellaneous that I wasn’t expecting: The US GAAP Taxonomy. A post at the XBRL Business Information Exchange says:

The US GAAP Taxonomy was built by the accounting standards setter, the FASB. It was built by accountants. It is a consensus-based product. Not one SEC XBRL filer uses the US GAAP Taxonomy as is to file with the SEC. Every SEC reorganizes the US GAAP Taxonomy.

But the US GAAP Taxonomy is not built to be reorganized. The structure of the taxonomy is more like a book. Can the US GAAP Taxonomy be reorganized? Of course it can. But it is certainly not optimized to allow for reorganization and reorganization is not even mentioned in the design characteristics. As such, it will cost more and be harder to create and maintain these reorganizations.

So how do you make it easier to reorganize? Many smaller pieces which can be put together as needed is vastly easier for a computer to deal with than having one large piece and trying to break that piece apart. That is one example of what can be done. Another is communicating the metadata which exists in the taxonomy, for example the information modeling patterns employed. A third is to make the existing metadata real metadata, rather than burying it in the labels of the concepts. Another is to add more metadata.

The post points out that it’s not that everything about that taxonomy should thrown into a big pile. There are key data points required by law and to achieve financial integrity. Still, this is not a place I would have thought miscellanizing would help. It seems, however, that I may well be happily wrong.

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December 30, 2010

No category of digital content has attracted payments from more than 33% of American Net users

Pew Internet reports that 65% of American Net users (75% of the people they contacted) have paid for online, digital content. Ever. And there’s no category of goods in which more than one third of the respondents have ever paid for content.

The content could include articles, music, software, or anything else in digital form. Here are the results for the fifteen different types of content Pew asked about:

  • 33% of internet users have paid for digital music online

  • 33% have paid for software

  • 21% have paid for apps for their cell phones or tablet computers

  • 19% have paid for digital games

  • 18% have paid for digital newspaper, magazine, or journal articles or reports

  • 16% have paid for videos, movies, or TV shows

  • 15% have paid for ringtones

  • 12% have paid for digital photos

  • 11% have paid for members-only premium content from a website that has other free material on it

  • 10% have paid for e-books

  • 7% have paid for podcasts

  • 5% have paid for tools or materials to use in video or computer games

  • 5% have paid for “cheats or codes” to help them in video games

  • 5% have paid to access particular websites such as online dating sites or services

  • 2% have paid for adult content

The first three are way lower than I would have expected. That 15% have paid for ringtones I find bewildering and just a little depressing. That 2% report having paid for “adult content” I take as meaning 2% actually responded, “Yeah, I pay for porn. You gotta problem with that?”

Overall, there are a number of different conclusions we could draw:

1. The survey was flawed. (The survey questions are here [pdf]). But Pew is a reputable group, and not in service of some other group with an agenda.

2. There is such a wealth of goodness on the Net that in no single category do a majority of people have to use money to get what they want.

3. This a sign of disease: So few people are paying for anything that entire categories of goods-provisioning are going to die, taking the abundances with them.

4. This is a sign of health: New business models based on minority participation are and will emerge that will keep the categories alive, and, indeed, flourishing.

5. Most of what’s available on the Net sucks so much that we won’t pay for it.

6. We are just so over paying for things, dude.

FWIW, I find I’m willing to pay for more content these days, in part out of a sense of responsibility, in part because the payment mechanisms have gotten easier, and always if I can sense the human behind the transaction. (This is a self-report, not a principled stand.)


October 30, 2010

Taking the integrity out of leadership

Harvard Business Review yesterday posted my piece on why American business leaders (and those who write about them) so often claim integrity as the most important property of leadership. (Blog posts at HBR are free to access.)

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September 26, 2010

[2b2k] Decisions, decisions

About two minutes ago I discovered that I was at the end of an EXTREMELY rough first draft of the chapter on decisions. If forced to lay odds, I’d say it’s about 12:1 that I will be doing a major rewrite of it, since I went through it with only a provisional idea of what I was going to say and how I was going to structure it. For example, I believe I may have the structure exactly backwards, and that the long first sections should be dropped or turned into a paragraph or maybe into a cute line drawing of a kitten.

This is the last chapter before the Grand Summation, of which we shall not speak, mainly because it causes formication over all areas of my exposed skin. In the current chapter I am writing about decision making because it is one of two proof points. The previous chapter is about science. Both that one and this one are intended to see if all the jibber jabber about networked knowledge that the reader has slogged through so far actually holds up in areas where we really really have to know what’s right and wrong. So, when we make a decision, does networked knowledge help? What happens when the rubber hits the node, so to speak?

The chapter as it stands begins by spending way too much time on the nature of distributed leadership. I spend page after page talking about Jack Welch as a counterexample (this will almost surely be cut drastically) to make the argument that modern business leaders take integrity as the chief attribute of leaders because organizations are Too Big to Be Led. Since you can’t be sufficiently competent in everything you would need to be, you claim that simply being a truthful, authentic person is enough. Yeah, sure. The fact that the memoirs of successful business leaders are often among the most inauthentic, squirmtastic writings around is just icing on the cake.

Anyway, I then argue that leadership, too, is becoming a property of networks, albeit it unevenly and certainly not in every case. I have a brief case study of the Army’s leadership center at West Point, based mainly on an interview with Lt. Col. Anthony Burgess. (The link is to a piece he wrote up after the interview.) I just don’t know if I’ve successfully sold the reader that an extended discussion of leadership is directly relevant to the topic of networked decision making.

I then make the point that I think I should begin the section with: If you look at decision-making as the isolated moment in which the bit is flipped, then you miss the networking of decision-making that goes on before and after that, even if the organization has no networked decision-making structures in place. Even when the decisions are made by the person at the top, they are made within a network that takes on many of the tasks and properties decision makers shouldered alone. So, the decision may still be a flicking of an leader’s thumb up or down, but that gesture may now occur within a network that has helped inform it, will carry it out, and will support it.

The final section takes a surprising turn for the practical. I was not expecting to end up there, but, when I checked my original outline, sure enough, that was exactly where I thought I’d be. I suppose that’s a good sign. Anyway, this final section’s premise is that to make smart decisions, we need smart networks (not in David Isenberg’s sense!). So, I quickly look at a bunch of properties of networks and loosely tie them to practices that will help make the network smarter than the smartest individuals in them. Nothing you haven’t heard before, which is, of course, a problem.

So, a very very very rough first draft that I may throw out tomorrow. Yay?


August 23, 2010

Netflix’s culture

Netflix has a 128-slide deck, meant to be read not talked through, that explains the company’s culture, including why they don’t award a fixed number of vacation days. I find it liberating, humane, and slightly scary.


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