Tom Peters Seminar2000:

Distinct or Extinct

Colombo
4 December 2000

In 25 years, youll probably be able to get the sum total of all human knowledge on a personal device.
Greg Blonder, VC [was Chief Technical Adviser for Corporate Strategy @ AT&T] [Barrons 13.11.2000]

NOW THATS B-I-G!

The period 2000-2002 will bring the single greatest change in worldwide economic and business conditions since we

came down from the trees.

David Schneider & Grady Means, MetaCapitalism

The corporation as we know it, which is now 120 years old, is

not likely to survive the next 25 years. Legally and

financially, yes, but not structurally and economically.
Peter Drucker, Business 2.0 (08.00)

Pentium III 800MHz: $42,893.00/# Hermes Scarf: $1,964.29 Saving Private Ryan on DVD: $874.75 Mercedes-Benz: $18.98 Hot-rolled steel: $0.19

Source: Fortune (3.20.00)

I genuinely believe we are living through the greatest intellectual moment in history.
Matt Ridley, Genome

We are in a

brawl with no rules.

Paul Allaire

The Kotler Doctrine:

1965-1980: R.A.F.
(Ready.Aim.Fire.)

1980-1995: R.F.A.
(Ready.Fire!Aim.)

1995-????: F.F.F.
(Fire!Fire!Fire!)

It used to be that the big ate the small. Now the

fast eat the slow.

Geoff Yang, IVP/ (Institutional Venture Partners)

Part I: Brand Inside Part II: Brand Outside Part III: Brand Leadership

Forces @ Work I The Destruction Imperative!

Forget>Learn

The problem is never how to get new, innovative thoughts into your mind,

but how to get the old ones out.

Dee Hock

It is generally much easier to kill an organization than change it substantially.

Kevin Kelly, Out of Control

Acquisitions are about buying market share.

Our challenge is to create markets. There

is a big difference.
Peter Job, CEO, Reuters

The [New] Ge Way

DYB.com

The Gales of Creative Destruction

+29M = -44M + 73M +4M = +4M - 0M

The secret of fast progress is inefficiency, fast and furious and numerous failures.
Kevin Kelly

Brand Inside Brand Organization: Lean, Linked, Electronic & Malleable

Headline: Bank of America to Cut 10,000 Jobs

Middle-level and senior managers are expected to be

the principal targets of the job cutbacks.
Source: The New York Times (07.29.2000)

White Collar Revolution!

The Pincer 5 Destructive entrepreneurs/ Global Competition White Collar Robots THE INTERNET!
[E.g.: GM + Ford + DaimlerChrysler]

Global Outsourcing
[E.g.: India, Mexico]

Speed!!

Assetless
Company
John Bryan, CEO, on selling all Sara Lees manufacturing

Cisco, Dell = Brand-owning companies who sell Customer Satisfaction

Source: David Schneider & Grady Means, MetaCapitalism [e.g.: Cisco owns 2 of 38 assembly plants]

RR on Assetless [J.B.] Sara Lee

The most profitable businesses in the future will act as knowledge brokers, linking insights into whats available with insights into the customers individual needs and preferences.

Advance Paradigm
Data on 165,000,000 prescriptions per year; docs and insurers have access to records Reduces med errors; saves $2.88 per scrip [prescribing errors]; docs save $14,000 per year in review time Rev in 99: $2B; $477M in 98
Source: Business Week (09.00)

Richard Rosecrance, The Rise of the Virtual State: Wealth and Power in the Coming Century

Hong Kong: Prototypical Virtual State

83% Service 8% Mfg.

Source: Richard Rosecrance, The Rise of the Virtual State

The virtual corporation is research, development, design, marketing, financing, legal, and other headquarters functions with few or no manufacturing capabilities a company with a head but no body.
Richard Rosecrance, The Rise of the Virtual State

We own all the intellectual property, we farm out all the direct labor.
Jim McDonnell, VP, IBM

The Futility of Size

[Regarding size] the new process of virtualization fully asserts itself. Virtualization is the recognition that territorial size does not solve economic problems. Economic access must become the substitute for increasing domain.
Richard Rosecrance, The Rise of the Virtual State

TP: Skill at creating, exploiting, and exiting crucial alliances beats ownership of fixed assets.

At the ultimate stage, competition among nations will be competition among educational systems, for the most productive and richest countries will be those with the best education and training.
Richard Rosecrance, The Rise of the Virtual State

Elementary and high school teachers should be rewarded as patient creators of high-value capital in the United States and elsewhere.
Richard Rosecrance, The Rise of the Virtual State

The Main crisis in school today is irrelevance.

Daniel Pink, Free Agent Nation

Our education system is a second-rate, factory-style organization, pumping out obsolete information in obsolete ways. Schools are simply not connected to the future of the kids theyre responsible for.
Alvin Toffler, Business 2.0 (09.00)

Brand Inside Brand Work: The Professional Service Firm Model & The WOW Project

So what will be the Basic Building Block of the New Org?

Answer: PSF! [Professional Service Firm] Department Head

to

Managing Partner, HR [IS, etc.] Inc.

The Raw Material

The WOW Project!

Reward excellent failures. Punish mediocre successes.

Phil Daniels, Sydney exec

You really got to me. So

many of our information technology projects take on a life of their own, and I know theyll never end up as more than mediocre successes.
CEO, F100 financial services company (10-98)

Measures

WOW! Beauty! Raving Fans! Impact!

Silicon Valley Success [Failure?] Secrets

Pursuit of risk: 4 of 20 in V.C. portfolio go bust; 6 lose money; 6 do okay; 3 do well;

1 hits the jackpot

Source: The Economist

Brand Inside Brand You: Distinct or Extinct

The fundamental unit of the new economy is not the corporation, but the individual. Tasks arent assigned and controlled through a stable chain of command but are carried out autonomously by - who independent contractors join together in fluid and temporary networks to sell goods and services. When the job is done, the network dissolves and its members become independent again, circulating through the economy, seeking the next assignment.
Thomas Malone and Robert Laubacher

e-lancers

If there is nothing very special about your work, no matter how hard you apply yourself, you wont get noticed, and that increasingly means you wont get paid much either.
Michael Goldhaber, Wired

Minimum New Work SurvivalSkillsKit2000 Mastery Rolodex Obsession (vert. to horiz. loyalty) Finishing Skills Entrepreneurial Instinct CEO/Leader/Businessperson Mistress of Improv Sense of Humor Intense Appetite for Technology Groveling Before the Young Embracing Marketing Passion for Renewal

[My ancestors were printers in Amsterdam from 1510 or so until 1750 and during that entire time they didnt have to learn anything new.
Peter Drucker, Business 2.0 (08.22.00)]

R.D.A.
Rate: 15%?, 25%? Therefore: Formal Investment Strategy/R.I.P.

You must realize that how you invest your human capital matters as much as how you invest your financial capital. Its rate of return determines your future options. Take a job for

what it teaches you, not for what it pays. Instead of a potential employer asking, Where do you see yourself in 5 years? youll ask, If I invest my mental assets with you for 5 years, how much will they appreciate? How much will my portfolio of career options grow?
Stan Davis & Christopher Meyer, futureWEALTH

The average knowledge worker will outlive the average employing organization. This is the first time in history thats happened. So the center of gravity of higher education is shifting from the education of the young to the continuing education of adults.
Peter Drucker, Business 2.0 (08.22.00)

Knowledge becomes obsolete incredibly fast. The continuing professional education of adults is the No. 1 industry in the next 30 years mostly on line.
Peter Drucker, Business 2.0 (22August2000)

Invent. Reinvent. Repeat.

Source: HP banner ad

Seminar Y2K/Brand Inside

Message: Distinct or Extinct!

Brand Inside Brand Talent: The Great War for Talent

When land was the productive resource, nations battled over it. The same is happening now for talented people.
Stan Davis & Christopher Meyer, futureWEALTH

The markets being divided up right now. Were in a tough competition [with the U.S. and the U.K.] for the best brains.
Gerhard Schroeder, on Germanys new tech immigration policy [Frankfurter Allgemeine/06.02.00]

The War for Talent is over and Talent has won!

Ed Michaels, The War for Talent

Sellers Market: Tomorrows Headline*

Molecular biologists are up 3 points, economists down 1/4, in moderate trading

*futureWEALTH, Stan Davis and Christopher Meyer

From 1, 2 or out [JW] to

Best talent in each industry segment to build best proprietary intangibles [EM]
Source: Ed Michaels, War for Talent (17.05.00)

We believe companies can increase their market cap 50 percent in 3 years. Steve Macadam at Georgia Pacific

changed 20 of his 40 box plant managers to put more talented, higher paid managers in charge. He increased
Ed Michaels, War for Talent (17.05.00)

profitability from $25 million to $80 million in 2 years.

So-so plant manager, $1M per year. Pay: $110,000 plus $60,000. Top plant manager, $3-4M per year. Pay: $135,000 plus $90,000. Net: $2-3M for $50K.
Source: Ed Michaels et al., The War for Talent, re Georgia Pacific

Top performing companies are two to four times more likely than the rest to pay what it takes to prevent losing top performers.
Ed Michaels, War for Talent (17.05.00)

The Rise of the Teen Guru

Theyre brilliant, ambitious, and almost intuitively gifted at technology. A new generation of whiz kids are gaining unprecedented power and authority.
Source: Cover story, Brills Content, 7-8/00

This is the Age of Ageism: The real innovators dilemma isnt disruptive technologies; its the relentless rise of the quasiadolescents who wield them.
Michael Schrage

Talented people are less likely to wait their turn. We used to view young people as trainees; now they are authorities. Arguably
this is the first time the older generation can and must leverage the younger generation very early in their careers.
Ed Michaels, War for Talent (17.05.00)

Gen-X Demands Love a new challenge. Want responsibility early. Crave freedom, independence and control. Are obsessed with building their Human Capital. Value more than work. See a very compressed career timeline.
Source: Ed Michaels et al., The War for Talent

Where do good new ideas come from? Thats simple! From differences. Creativity comes from unlikely juxtapositions. The best way to maximize differences is to mix ages, cultures and disciplines.
Nicholas Negroponte

Diversity defines the health and

wealth of nations in a new century.
Mighty is the mongrel. The hybrid is hip. The impure, the mlange, the adulterated, the blemished, the rough, the black-and-blue, the mix-and-match these people are inheriting the earth. Mixing is the new norm. Mixing trumps isolation. It spawns creativity, nourishes the human spirit, spurs economic growth and empowers nations.
G. Pascal Zachary, The Global Me: New Cosmopolitans and the Competitive Edge

Capitalism and the conditions for creating wealth have changed in ways that play to the strengths of hybrid individuals, organizations and nations. And those that wish to profit from changing economic conditions must view hybridity as their first and best option. This bold claim warrants an explanation. The ability to apply knowledge to new situations is the most valued currency in todays economy. Highly creative people are misfits on some level. They tend to question accepted views and consider contradictory ones. This appreciation defines the mongrel mentality. Strangers instinctively question things that natives take for granted. Many things strike them as odd or stupid.
G. Pascal Zachary, The Global Me

Tomorrow belongs to women.

Helen Fisher, The First Sex: The Natural Talents of Women and How They Are Changing the World

AS LEADERS, WOMEN RULE: New Studies find that female managers outshine their male counterparts an almost every measure
Title, Special Report, Business Week, 20.11.00

On average, women and men possess a number of different innate skills. And current trends suggest

that many sectors of the twentyfirst-century economic community are going to need the natural talents of women.
Helen Fisher, The First Sex: The Natural Talents of Women and How They are Changing the World

Womens Natural Talents and the New World of Work

Interactive style of management Proclivity to share information Need to strive for group consensus Desire to empower workers Comfort with ambiguity Seek win-win solutions to thorny problems
Source: Helen Fisher, The First Sex

TAKE THIS QUICK QUIZ: Who manages more things at once? Who puts more effort into their appearance? Who usually takes care of the details? Who finds it easier to meet new people? Who asks more questions in a conversation? Who is a better listener? Who has more interest in communication skills? Who is more inclined to get involved? Who encourages harmony and agreement? Who has better intuition? Who works with a longer to do list? Who enjoys a recap to the days events? Who is better at keeping in touch with others? Source: Selling Is a Womans Game: 15 Powerful Reasons Why Women Can Outsell Men, Nicki Joy & Susan Kane-Benson

Boys are trained in a way that will make them irrelevant.

Phil Slater

The Cracked Ones Let in the Light Our business needs a massive transfusion of talent, and talent, I believe, is most likely to be found among non-conformists. David Ogilvy

Whoever is the most impertinent has the best chance.

W.A. Mozart

The NAESP

Attributes of Those Who Made the 10th Grade History Book Committed! Determined to make a difference! Focused! Passionate! Irrational about their lifes project! Ahead of their time / Paradigm busters! Impatient! / Action Obsessed

Attributes of Those Who Made the 10th Grade History Book

Made lots of people mad! Flouted the chain of command! Creative / Quirky / Peculiar! / Rebels! / Irreverent! Masters of improv / Thrive on chaos / Exploit chaos!

Attributes of Those Who Made the 10th Grade History Book

Forgiveness > Permission Bone honest! Flawed as the dickens! In touch with their followers aspirations Damn good at what they do!

One size NEVER fits all. One size fits one. Period.

H.R. to H.E.D. ???

Human Enablement Department

Firms will not manage the careers of their employees. They will provide opportunities to enable the employee to develop identity and adaptability and thus be in charge of his or her own career.
Tim Hall et al., The New Protean Career Contract

44 Players = 44 Projects = 44 different success measures

Insights from 80,000 managers: People dont change much. Dont waste time trying to put in what was left out. Try to draw out what was left in. That is hard enough.
Source: Marcus Buckingham & Curt Coffman, First, Break All the Rules: What the Worlds Greatest Managers Do Differently

Mantra2000

Talent = Brand

We have transitioned from an asset-based strategy to a talent-based

strategy.
Jeff Skilling, COO, Enron

The Top 5 Revelations

Better talent wins. Talent management is my job as leader. Talented leaders are looking for the moon and stars. Over-deliver on peoples dreams they are volunteers. Pump talent in at all levels, from all conceivable sources, all the time.
Source: Ed Michaels et al., The War for Talent

Brand Inside Reprise: THINK WEIRD: The High Standard Deviation Enterprise

New Economy: Was-Is

Pine-paneled Office Address: 1 Big Man Plaza Secretary Suit Formal Rank conscious Pretense (Failures are for fools.) I love Yes men Self-contained Seat 9B, UA233 Address: Rick@Corp.com Typing: 60 WPM Casual M-F Approachable We are a HOT Team Screwing up is as normal as breathing I love Misfits! I love partners

Renewal = The Weird 10 = The High S.D. Enterprise/Individual

Pioneer [Weird] Acquisitions Pioneer Customers & Alliance Partners [Measure the Portfolios S.D.] Divide & Conquer/Sell-by [Lessons from the Bees, Sir Richard, Gary H.] Pioneer Assignments/Pioneer Projects [F2F & K2K] Hire Weird [Diversity]/Train Weird/Promote Weird/Pay Gobs & Promote Fast & Cherish Six Sigma Talent/Appoint a Weird Board Weed Un-weird [One Sigma Talent, etc.] Hang out with Weird [Univ. of Weird]/Lunch with Weird/ Read & Surf Weird/Vacate Weird R.A.F. to R.F.A. to F.F.F. [O.O.D.A. Loops/Prototyping Mania] Sense of Humor [Rhapsodize Over Thine Failures] Re-enforce a Culture of Disrespect/Piracy

Saviors-in-Waiting

Disgruntled Customers Fringe Competitors Rogue Employees Edge Suppliers

Wayne Burkan, Wide Angle Vision: Beat the Competition by Focusing on Fringe Competitors, Lost Customers, and Rogue Employees

Part I: Brand Inside Part II: Brand Outside Part III: Brand Leadership

Forces @ Work II The Commodity Trap

Quality Not Enough!

While everything may be better, it is also

increasingly the same.

Paul Goldberger on retail, The Sameness of Things, The New York Times

We make over three new product announcements a day. Can you remember them?

Our customers cant!

Carly Fiorina

The surplus society has a surplus of similar companies, employing similar people, with similar educational backgrounds, working in similar jobs, coming up with similar ideas, producing similar things, with similar prices and similar quality.
Kjell Nordstrom and Jonas Ridderstrale, Funky Business

Brand Outside Strategy 1: Work with Pioneers!

Our strategies must be tied to leading edge customers on the attack.

If we focus on the defensive customers, we will also become defensive.
John Roth, CEO, Nortel

Future-defining customers may account for only 2% to 3% of your total, but they represent a crucial window on the future.
Adrian Slywotzky, Mercer Consultants

Brand Outside Strategy 2: Use E-Commerce to Re-invent Everything!

OVERVIEW

www.cyveillance.com
30.08.2000/0521GMT:

2,461,940,629

www.cyveillance.com 03.12.2000/1239GMT:

3,152,300,796

95 days, 7 hours, 18 minutes

+690,360,167

Tomorrow Today: Cisco!

90% of $20B (=$50M/day)

75% mfg. outsourced; 50% of orders routed to supplier who ships direct Gross margin: 65%; Net margin: 28%

Annual savings in service and support from customer self-management: $550M

COMMUNITY SERVICES!/ CUSTOMER CONTROL!

Tomorrow Today: Cisco!

90% of $20B; save $550M C.Sat e >> C.Sat H Customer Engineer Chat Rooms/Collaborative Design ($1B free consulting) (45,000
customer problems a week solved via customer collaboration)

Anne Busquet/ American Express

Not: Age of the Internet

Age of Customer Control

Is:

SUMMARY: REINVENT EVERYTHING

WebWorld = Everything Web as a way to run your business innards Web as connector for your entire supply-demand chain Web as spiders web which re-conceives the industry Web/B2B as ultimate wake-up call to commodity producers Web as the scourge of slack, inefficiency, sloth, bureaucracy, poor customer data Web as an Encompassing Way of Life Web = Everything (P.D. to after-sales) Web forces you to focus on what you do best Web as entre, at any size, to Worlds Best at Everything as next door neighbor

Message: eCommerce

is not a technology play! It is a relationship, partnership, organizational and communications play, made possible by new technologies.

is no such thing as an effective B2B or Internet-supply chain strategy in a low-trust, bottleneckedcommunication, six-layer organization.

Message: There

A DREAMERS MEDIUM!

There is no use trying, said Alice. One cant believe impossible things. I daresay you havent had much practice, said the Queen. When I was your age, I always did it for half an hour a day. Why, sometimes Ive believed as many as six impossible things before breakfast.
Lewis Carroll

Inet

allows you to dream dreams you could never have imagined before!

Brand Outside Strategy 3: Design Matters!

All Equal Except At Sony we assume that all products of our competitors have basically the same technology, price, performance and

is the only thing that differentiates one product from another in the marketplace.
Norio Ohga

features. Design

We dont have a good language to talk about this kind of thing. In most peoples vocabularies, design means veneer. But to me, nothing could be further from the

Design is the fundamental soul

meaning of design. of a man-made creation.
Steve Jobs

Design is WHAT & WHY I LOVE.

LOVE.

Design is WHY I GET MAD.

MAD.

Design is never

neutral.

DESIGN is the principal difference between love and hate!

Hypothesis:

THE BASE CASE: I am a design fanatic. Personally, though not artistic, Im a cool-stuff guy. I love what I love and I hate what I hate. [Openly.] But it goes [much] further, far beyond the personal. Design has become a professional obsession.

I - SIMPLY BELIEVE THAT DESIGN PER SE IS THE PRINCIPAL REASON FOR EMOTIONAL ATTACHMENT [or detachment] RELATIVE TO A PRODUCT OR SERVICE OR EXPERIENCE.
Design, as I see it, is arguably the #1 determinant of whether a product-service-experience stands out or doesnt. Furthermore, its one of those things that damn few companies put consistently on the front burner.

Brand Outside Strategy 4: Women Rule!

?????????

Home Furnishings 94% Vacations 92% Houses 91% Bank Account 89% Health Care 80% Consumer Electronics 51% Cars 50%+/80% Etc.

Women 50+% of Web users; 6 of 10 new users; 83% of wired women are primary decision makers for family healthcare, finances, education.
Source: Business Week; Jupiter Communications

(!!!)

$4.8T > Japan 9M/27.5M/$3.6T > Germany

OPPORTUNITY NO.

1!

Read This Book

EVEolution: The Eight Truths of Marketing to Women

Faith Popcorn & Lys Marigold

Men and women dont think the same way, dont communicate the same way, dont buy for the same reasons. He simply wants the transaction to take place. Shes interested in creating a relationship. Every place women go, they make connections. EVEolution

EVEolution: Truth No. 1

Connecting Your Female Consumers to Each Other Connects Them to Your Brand

Women dont buy brands. They

join them.
Faith Popcorn, EVEolution

STATEMENT OF PHILOSOPHY: I am a businessperson. An analyst. A pragmatist. The enormous social good of increased womens power is clear to me; but it is not my bailiwick. My game is haranguing business leaders about my fact-based conviction that womens increasing power leadership skills and purchasing power is the strongest and most dynamic force at work in the American economy today. Dare I say it as a long-time Palo Altan THIS IS EVEN BIGGER THAN THE INTERNET!
Tom Peters

Brand Outside
Strategy 5:

BRAND POWER!

Brand It! Now, More Than Ever!

The increasing difficulty in differentiating between products and the speed with which competitors take up innovations will assist in the rise

and rise of the brand.

Gillian Law and Nick Grant, Management [New Zealand]

We are in the twilight of a society based on data. As information and intelligence become the domain of computers, society will place more value on the one human ability that cannot be automated: emotion. Imagination, myth, ritual - the language of emotion will affect everything from our purchasing decisions

Companies will thrive on the basis of their stories and myths. Companies will need to understand
to how we work with others. that their products are less important than their stories.
Rolf Jensen, Copenhagen Institute for Future Studies

Brand = You Must Care!

Success means never letting the competition define you. Instead you have
to define yourself based on a point of view you care deeply about.
Tom Chappell, Toms of Maine

WHO ARE YOU [these days] ?

TP to Client

Brand = Special = Passion = Plot = Compelling Mythology = Cause = Connection = Heart = Integrity & Trust

Rules of Radical Marketing

Love + Respect Your Customers! Hire only Passionate Missionaries! Create a Community of Customers! Celebrate Craziness! Be insanely True to the Brand!
Sam Hill & Glenn Rifkin, Radical Marketing (e.g., Harley, Virgin, The Dead, HBS, NBA)

Part I: Brand Inside Part II: Brand Outside Part III: Brand Leadership

Brand Leadership

Passion Rules!

Leadership is a performance. You have to be

conscious of your behavior, because everybody else is. Carly Fiorina

A key perhaps the key to leadership is the effective

communication of a story.
Howard Gardner Leading Minds: An Anatomy of Leadership

Create a Cause, not a business.

Gary Hamel, Fortune (06.00), on reinventing a company (Exemplar #1: Charles Schwab)

I am a dispenser of enthusiasm.
Ben Zander

A leader is a dealer in hope.

Napoleon

Leadership 2000 Talent-obsessed (Great>>>Good) Opportunity Structure (Fast, Cool, Accountable, Rewarding) Pursuit of a Cause (Brand-driven) Content-driven (PSF/WOW! Projects) State-of-the-Art (Technology!) Adventuresome Culture (Disrespect, Short Memory, Sense of Humor) Culture of Hyper-urgency Enthusiast-in-Chief

Tom Peters SeminarY2K

Message: Distinct or Extinct!