The Social Customer Manifesto

In Search Of Failure

"I often felt there might be more to be gained by studying business failures than business successes. In my business, we try to study where people go astray, and why things don't work...Albert Einstein said 'Invert, always invert, in mathematics and physics,' and it's a very good idea in business, too. Start out with failure, and then engineer its removal." - Warren Buffett

Just tripped across the above-quoted sentiment and it just resonated. Am (still) reading Reichheld's The Loyalty Effect, and have just embarked into what is, so far, the best chapter I've read in a business book in a long time. It's entitled "In Search Of Failure."

Why don't more folks take Buffett's approach, and examine failures (both business and personal) more aggressively? Two reasons (says Reichheld):

• Fear
• Incapacity

Examining failure is culturally taboo. It means that "something went wrong...and talking about it might make me look bad."

Get over it. Things happen. (Remember Windows 2.1?) Only by examining where things went wrong, can a business figure out what not to do the next time around.

This is of critical import with respect to customers.

• Did the customer defect? If you don't have a process in place to analyze that defection (an indictment of the organization's inability to meet the customer's needs), how can you prevent the next defection?
• Did the prospect choose a competitor over your organization? Talk to them, and find out why. That way, the next time a similar opportunity comes up, you won't make the same mistakes again.

We're currently working on a large win/loss analysis project for a client. And...surprise...better conversations are actually taking place with the losses than with the wins. Better insight. More candid conversations (hey, the deal's already lost...why beat around the bush?).

This approach is applicable not only to the win/loss process, but product development as well. We're currently working on some new things (watch this space!) and, far and away, we're learning more from the constructive, critical feedback we're getting from customers than from the attaboy's.

The bottom line? Listen to the customer. Embrace the failures when they happen. Learn from them. Make things better.

Finding The Conversations

Johnnie Moore's blog rocks, and it's one of 100+ that I have read through my aggregator in the past. But I rarely read it anymore. Why? Because there's something better.

What's better than his blog? Finding the conversations that he's hosting.

This is because, although his blog is here, he publishes the feed for just his comments. This is where the good stuff is happening. This is where the conversations are happening. (n.b. have shamelessley stolen this idea, and if'n you're interested the comments feed for The Social Customer Manifesto is here).

Subscribing to just the comments is a double-edged sword. On one hand, there may be insights that are missed in the "regular" blog posts. But as long as there are a good number of readers/lurkers to a regular blog, and some small number of those folks choose to start a conversation in the comments, there is an almost built-in filtering mechanism that is put in place...the posts that generate the most comments are the "high value" ones that pop up, and are the ones that get read. (By the way, Wilco is amazing. Buy all their records. Now. And Lane's too, while you're at it.)

Here's a link to how to do this yourself in Moveable Type or Typepad (thanks, Johnnie for pointing this out). It's pretty straightforward, but you need to be comfortable mucking with the templates. Drop me a note...or a comment...if you're not able to get it to work.

Hierarchy, Subverted

Was reading the recent post by Cynthia Price on the GM Fastlane blog. (hat tip: nevon)

Down in the comments were two items that stood out:

Mary Freund: "Dear Mr.Lutz: I am a G.M. employee. I work in Doraville , GA. Please put a hybrid engine in our product!!!"

Clarence Erickson: "As a GM employee I have noticed that sometimes the dealers don't treat even me right. My wife also had a few rough visits where I had to intervene...Perhaps we should work on this a little more. They do tend to treat people like sheep at times and there is the leftover perception from the bygone days that the dealer service department will work you over every time."

Things I'd love to know the answer to:

1) How many (5? 15?) organizational levels exist within GM between the execs doing the blogging (Cynthia Price and Bob Lutz) and the internal GM folks (Mary and Clarence) who are using this public forum to give the execs direct feedback?

2) How long would it take for that feedback to be shared upward using pre-existing internal communications mechanisms?

3) What would be the likelyhood of a response using the internal mechanisms in the pre-blog days? And if there was a response, how long would it take to get to get back to Mary and Clarence?

Internal, External Business Conversations

Hugh writes a great post about why business blogs can help organizations improve customer connections. (Updated to later illustrate that the concept is relevant in intra-organizational discussions as well.) The metaphor is that there is a membrane that surrounds every organization, and that membrane impedes real information flow and, with it, learning. The nugget:

Hugh: "The more porous your membrane ("x"), the easier it is for the internal conversation to inform the external conversation, and vice versa."

In other words, if there is alignment, or "equilibrium," between what's happening inside the organization and what's happening in the customer base, both sets of stakeholders will be better off. Customers will be getting what they want, and organizations will have happy customers. And, presumably, reasonable profits.

This triggered four thoughts:

• The theory above sounds a lot like this.
  
• For this to work, it can't just be "conversation," it has be the RIGHT conversation.
  
• There is a flow to this. Flow 1 is "out to in."
  
• There is a second flow to this. Flow 2 is "in to out."

So, first off, this sounds a lot like thermodynamics. I had to go look up the thermo stuff to put this post together, and then it made my head hurt (again, like it did mumblysomethingsomething years ago, the first time I saw it in school), so I closed that page quickly. But, I think a way to characterize this model is through paraphrasing that law into something like this:

"Insight spontaneously disperses from being localized to becoming spread out if it is not hindered."

Insight is good. Knowledge is good. Knowledge of real customer needs can help an organization do the right thing for the market. Knowledge of what a supplier is doing can help a customer make better decisions.

Another way of putting this...communication in this way changes the game from being zero-sum to being collaborative. Things tend toward zero-sum when information is withheld, and power and manipulation come into play. This changes that.

Moving onto the second point above, the idea of "conversation" needs some clarity. We've come to use the word "conversation" as shorthand for "folks who 'get it,' and want to work collaboratively, and want to share information, etc." However, all conversations are not the same. More importantly, all conversations are not equal.

For this model to work, some conversational structure may need to be in place. If customers are clamoring for something (let's say, a fad-ish feature in a product that may have long-term detrimental effects), the company can react in two ways. In the first case, the company can listen to those customers blindly, and deliver exactly what they want. In the second case, the company could try to explain some of the shortcomings of following that approach, and try to reach a middle ground where both parties agree, that results in a longer-term positive outcome for both sides.

Both cases reach equilibrium, but they are certainly not equal conversations.

Which brings us to points three and four above, the flows. There will be an increasingly strong "out-to-in" flow if a company is not meeting the current needs of its customers. If there is a flood of feedback going across that membrane from out-to-in, and nothing is being done about it, there is a sure bet that at some point in the future that organization will be in trouble. However, if that out-to-in flow is moderate and steady and is responded to with an equal in-to-out flow of information about how the company is responding, you can bet the company is marching ahead in step with where its customers are going.

The "in-to-out" flow, on the other hand, is a quite interesting one. Assuming the in-to-out flow is information-rich (and not a flood of the same-ol'-B.S.), the company is providing some insight and novel ideas to the marketplace. This is good. However, similar to the example above, if this flow gets too strong, the company may be outrunning its customers, and providing products or services that require change the market can't yet absorb or isn't ready for yet (see the Apple Newton for an example). In this case, the company should take a step back and perhaps slow down a notch and listen to what's coming back in from the outside.

Food for thought.

Others commenting on this:

Lee LeFever
BlogSpotting (Heather Green)
Fredrik Wackå
Scoble

Vespa To Launch Corporate Blogs

Article today in the WSJ regarding how Vespa will be launching a corporate blog ($), which will be penned by U.S.-based Vespa owners. According to the article, VespaBlogs.com will have "four bloggers will be selected to regularly contribute content about the products and broader lifestyle topics."

A couple of salient points:

• Initial statements seem that the bloggers will be be given relatively free rein -- a "code of ethics" to which they will adhere, but it doesn't appear that Vespa will have editorial control.
  
• This is a great application, for the right company. Vespas evoke emotion and passion, and Vespa owners will be apt to build a community around these blogs.

This is similar to the work that was done for Knight Ridder Digital's That's Racin' property, which is home to four racing enthusiast blogs:

• Kathy's Pit Stop (a fan blog)
  
• Rantville (a fan blog, occasional spicy content)
  
• Over The Wall (by a pit crew member)
  
• Checkered Past (by That's Racin's editor)

(disclosure: Manifesto co-conspirator Lisa Stone worked with KRD on setting up the TR blog network)

Hopefully, Vespa will be emulate what was done here (in freedom-of-expression and clueful-ness, not in content, naturally), and the Vespa blogs will have the same type of authenticity and no-holds-barred direction that KRD has allowed their customers/fans/evangelists to pursue.

Creative Commons Hooks Up With...BzzAgent. Weigh In If You Have An Opinion.

Pull the plug, please, Larry.

On April 29, Creative Commons announced they had joined up with BzzAgent. Thankfully, the feedback has been flowing furiously.

Lessig states:

"Creative Commons recently launched a relationship with BzzAgent. The blogs were not amused. See Corante, Corante_II , Corante III, Just a Gwai Lo. BzzAgents has now responded poorly, calling Corante 'liars.' As I'm partial to Corante, I'd be willing to ask CC to pull the relationship on the basis of that bad judgment alone. But I'd be really keen for some feedback."

You really need to read where Dave Balter, CEO of BzzAgent, calls bloggers liars. Nice. Or, as they say on the southwest side of Chicago..."real clazzy."

"Bloggers as Liars
Saturday, April 30 2005 @ 10:57 AM CDT
Contributed by: Dave Balter

I really wonder.

Whenever I talk to people about BzzAgent, give a speech or work with clients, they invariably ask us about Blogs. They want to know how BzzAgents can influence bloggers. How much of a role blogging has in word-of-mouth.

Let's get this straight: Over 80% of word of mouth occurs OFFLINE. Blogs are a tool for word-of-mouth interaction, but just because there's plenty of them out there, it doesn't mean it's the best place for distributing an honest opinion.

Which brings me to point two. Bloggers are destroying their own medium.

How? By being more critics and pundits than journalists. The problem is that there are no editors and no fact checkers, so plenty of what you read on blogs is just plain untrue. Check out Suw Charman's Corante post on BzzAgent's Partnership with Creative Commons, where she misstates nearly a dozen facts. And much of what she says is also pulled from other blogs. Guess what? Her informants are providing false information, too. A vicious cycle of lies.

With this type of reporting (whining?), it's no wonder many consumers are going back to reading fact-checked business magazines.

How long until consumers hold bloggers up to the same standards of truth as they'd expect from word-of-mouth interactions?

Dave"

Larry, add my voice to to the list, requesting the end of this relationship.

And if you want to add yours to it, write about it and trackback here, or comment directly here (there are already dozens of comments; there'll be hundreds by tomorrow I'm sure).

By the way, from the comments over there, the best.comment.ever, addressed to BzzAgent, from Matthew Skala:

"Hey, guys, 1998 called. They want their business plan back."

Heh. That's funny.

Update:

Balter apologizes

(I'm going to turn comments off on this particular post, 'cuz the place they really need to be is over at Lessig's blog. Add your voice, click here, and weigh in.)

Great Business Blogging Article From CIO Insight

Ed Cone has just published an in-depth article on enterprise blogging, entitled "Rise of the Blog" in CIO Insight.

A very well written piece. A particularly spot-on assessment was:

"By enabling comments on its blogs, Sun can get a look at what mix of customers, partners, developers and employees is frequenting its sites, and respond to them. Customers who used to interact only with their salesperson can now communicate with members of the product team."

DING! This really is the meat of this conversation. Sun's folks seem to agree.

Jonathan Schwartz - "There's an immediacy of interaction you can get with your audience through blogging that's hard to get any other way, except by face-to-face communication. There's no other way any individual, never mind someone who's running a company as large as Sun, could speak face-to-face with that large an audience on a regular basis."

Tim Bray - "This is a fantastically effective listening device. Customers are coming to us directly as bloggers. People see us do something wrong or stupid, or missing a chance, and they tell us. We get dozens of comments a week that can help us, and they go to the right people—how else is a smart guy in Cleveland going to find the relevant person at a computer company with 30,000 employees?"

This is the vanguard of this thinking, and really is presaging a move towards real customer interaction, as opposed to the things that have been called "CRM" but are really tools for managing sales teams and the Street.

Another bit in there that really stood out was the reference that Jared Spataro of Open Text made regarding the internal use of blogs as a communications medium during the integration phase of M&A activities. (Would have liked to have seen more depth on this; it sounds like a great application.)

Of course, David Weinberger gets the digging quote, saying that "public-facing blogs with voices that sound recognizably human will kill the 'pompous and inhuman' tone used in much corporate-speak."

Indeed.

BusinessWeek Business Blogging Cover Story Nails It

The cover story of the current issue of BusinessWeek sums it up well: "Blogs Will Change Your Business."

Reading through the article, the one quote that resonated (and continues to do so) was this one: “Your customers and rivals are figuring blogs out. Our advice: Catch up…or catch you later.” It definitely feels like we're at the inflection point; about to hit Geoffrey Moore's chasm with respect to business blogging.

A couple of interesting tidbits:

Tidbit 1 - BW has launched blogspotting.net, their own actual, honest-to-goodness blog to cover the emerging area of blogs and business. To Heather, Steve, and the rest of the BW team...nice job!

Tidbit 2 - They also did a nice job pulling together a quick list of things to consider when launching a business blogging initiative. (Unfortunately, BW buried the link in a place requiring serious excavation in order to find it.) The highlights:

• Train Your Bloggers
• Be Careful with Fake Blogs
• Track Blogs
• PR Truly Means Public Relations
• Be Transparent
• Rethink Your Corporate Secrets

Boilers are stoked. Pressure is right. It's time for this train to leave the station.

Although the quote noted above is spot on, the customer angle, and the "how are people really addressing business blogging" aspects were glossed over a bit in the article. (However, considering the article's breadth, that's understandable.) That being said, still would have like to have seen more case studies, and more examples of the different ways organizations are using blogs to connect with customers.

Paternalistic Relations

ZDNet's David Berlind gives some well-deserved credit to Scalix founder Julie Hanna Farris for her willingness to engage in "public conversation that includes all of her constituents (the press, potential customers, casual onlookers, and even competitors)." I'm in agreement with Berlind on this.

He goes on to say:

"Public relations personnel cringe at the idea of executives diving into the blogosphere and mixing it up with the press and end users. Maybe that's because of how the blogosphere prevents them from interceding when an executive is about to say something that shouldn't be said. Personally, I think it makes both the executives and the company seem more open and approachable. When a vendor executive lays it on the line like that, he or she knows that the blogosphere is probably going to respond with brutal honesty. Just that sort of open invitation says something about a person's belief in what they are saying and willingess to engage--unfortunately, it's a rarity in our business." (emphasis his)

Right on.

And then, Berlind's first sentence in the pull quote seems especially prescient after reading the followup from Steve, who writes

"Let your executives have fun if they want to, ok? But guide them on what works/doesn't. That's our role as PR professionals."

Whoa. Did I misread that? Please tell me I misread that. Steve..."have fun?" As if this is some kind of game? If one was a cynic, one could interpret that as a wink and a nudge..."we'll let those dotty executives go and play in the blog-box, but we'll be there to hold their hands in case they get off-message and, heaven forbid, communicate what's actually on their minds."

:soapbox:

It's not about the veneer.

It's not about a sanitized, perfectly-crafted, and ultimately synthetic message.

It's about reality, warts and all.

It's about real people, interacting with other real people.

:soapbox:

Can More People Be Like Doug Kaye, Please?

(mea maxima culpa for omitting the trailing "e" in Doug's name in rev. 1 of this. Thanks to Steve for setting me straight.)

I want to know more about Doug Kaye. A quick search for "'doug kay'+bio" brings back a paltry 23 results, only two of which relate to this Doug Kay.

I first heard about Doug Kaye at BloggerCon in November, 2004. At the same time, I heard about IT Conversations for the first time. The best summary I've found so far is from here:

One of the largest podcasters is Doug Kaye’s IT Conversations. Great, in-depth discussions with folks in the technology community (An awful lot of content of this nascent medium serves its geek constituency. But bloggers spent a lot of time talking about Open Source and the like before they got around to other stuff.)

Some of the most amazing content at IT Conversations is complete audio archives of important tech industry conferences: Web 2.0, PopTech, Bloggercon, Stanford’s Accelerating change and 20 others are there in their entirety, for free.

So, as best as I can tell, Doug has been helping to record, produce, and distribute this amazing body of content. And, with the exception of perhaps some help on the bandwidth side from a sponsor, he's been doing it for the passion of what he's doing.

Last month, he got reflective about this very fact. Kaye:

"The one question I'm asked about IT Conversations more than any other is, "What's your business model?" After 18 months, nearly 300 programs and now with the New Year looming, the time has come to answer that question."

Your stereotypical Silicon Valley type would start calling up VCs and bankers, and perhaps draw up a business plan for the "next generation, peer-to-peer, highly-distributed content distribution platform."

Not Kaye. He looked left, looked right, set up a collaborative space to have a conversation, and asked his customers "what should I do?"

Kaye seeded the conversation with two broad categories:

• Advertiser/Sponsor Revenues
• Listener-Side Revenues

Then he let it go, and asked his customers "What do you think?"

The response has been amazing. At the current time, nearly sixty responses have been given to that simple question, including a number of thoughtful replies from other folks like Ross Mayfield and Steve Gillmor both within the wiki and in the blog diaspora.

And I have a feeling as we venture not too very far into 2005, Mr. Kaye will have his answer. Cheers, Doug. Good on ya for letting the customers drive.