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Re: The S-word & BM as Silicon Valley's religion
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Doc Searls
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Sep 11, 2000 16:47 PDT
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| | While I get the impression that Strategy and BM (business model) are not
words that many in this train like to give the time of day to as they are
currently realised, I'd still like to reraise a question. For business
people who start in their world of the S-word or the Business Model, how can
we make Cluing Conversation a sort of Trojan horse that ultimately takes
over the way they expect their company to do strategy/business model?
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"Strategy" is part of a vocabulary induced by machine, sports, war
and game metaphors. It's pro forma big business talk, and exactly the
kind of thing we spoke out against in The Cluetrain Manifesto. We
posited "markets are conversations" literally as an alternative
metaphor. There is almost no way that the conversation metaphor can
induce a vocabulary with "strategic" in it.
"Strategic" thinking reached its high-military mark in the book
"Marketing Warfare," by Al Ries and Jack Trout, the guys who gave us
Positioning: The Battle for Your Mind, and a series of other books,
all extremely compelling and well-written, all customer-hostile in
the extreme.
Here's the first sentence in Marketing Warfare: "The true nature of
marketing today is outwitting, outflanking, outfighting your
competitors. In short, marketing is war where the enemy is the
competition and the customer is the ground to be won."
As we say in the book, it's no wonder marketing treats customers like
dirt. As a customer, I want a supplier to do business *with* me, not
*to* me, which is why I believe the whole B2B, B2C, F2Q way of
thinking is screwed. It's old bile in new bottles. The problem is
with the preposition, *to*. It's the same old shipping metaphor at
work. Business is still about moving goods through conveyor-belt-like
value chains from producers to consumers. Shortening the belt doesn't
make it any more friendly and conversational.
| | For me one of the more open ideas of strategy and business model is Gary
Hamel's , so I'm extracting a bit from his latest book (Leading the
Revolution) in case anyone either wants to comment on it here within these
train's clues
or
another posting place newec-@topica.com where cluetrain and Hamel are
but 2 of 50 new economy books we're rummaging through
(http://www.topica.com/lists/neweconomy )
chris macrae
Hamel's intro p70:
"Business concept innovation is a religion in Silicon Valley. In the Valley,
precocious 25-year-olds know what a business concept is. They relish the
chance to deconstruct old ones and build new ones. Yet in most companies
outside the Valley, I can't find a person in a hundred who can tell me what
a business concept is, much less how to invent or reinvent an old one.
Moreover, I doubt you can find a dozen individuals in your company who share
a common definition of your company's existing business concept. Though
consultants talk incessantly about "business models", I've never met one who
has a coherent definition of what one actually is. So let's take a few
minutes and learn how to decompose business as a concept.
In diagram: top line = Hamel's 4 major components of business concept,
middle line = three bridges linking components; bottom line = 4 underpinning
factors determining profit potential
CUST. INTERFACE<>CORE STRATEGY<>ST. RESOURCES<>VALUE NETWORK
<customer benefits> <configuration> <company
boundaries>
crosscheck everything by : Efficiency; Uniqueness; Fit; Profit Boosters
CORE STRATEGY is essence of how firm chooses to compete; it's elements
include business mission, product/market scope, basis for differentaition.
STRATEGIC RESOURCES provide the base for actually having a competitive
advantage; this includes core competences, strategic assets and core
processes
CUSTOMER INTERFACE is the context whose link to core strategy provides
customer benefits (an important component of any business concept is
decision on which benefits are or aren't going to be included). The
interface includes fulfilment and support, information and insight,
relationship dynamics and pricing structure.
VALUE NETWORK is the component of a business model which surrounds the firm,
and which complements and amplifies the firm's own resources. It includes
suppliers, partners, coalitions.
Hamel ends the chapter by saying:
Begin to practice. Pick the worst company experience you've had last year,
and think about the business model that falied to meet your expectations.
How would you change it element by element? Or pick a company you care
about - one you think deserves to be more successful than it is - and try to
imagine a breakout business concept. The great advantage of a business
concept is that its infinitely malleable. It is, at the outset only an
intellectual construct. Do pretend you're a kid again -with a very big Lego
set, one that allows you to remake the very foundations of commerce. This
isn't some meaningless execise. This is mental training for industry
revolutionaries.
Anyone like to rehearse a case with us?
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No offense, but there isn't anything here that isn't coming out of
the same old military, shipping & machine metaphors. By these
metaphors, "business models" are just choices among weapons and
freight forwarding systems. Categorically, it's the problem. No
solution can come from anything so disconnected from reality.
Conversational markets are the Real Deal.
Want to know why sales and marketing don't get along? Because sales
deals with customers. Marketing doesn't. That's the fundamental
difference. Sales used to run marketing in most big companies. It
pissed off the marketing folks who wanted to be "strategic." (Believe
me, I was exactly in that position for many years, working with many
companies.) Turns out Sales was right. Sales trumped marketing with
Reality, which was customer relationships.
Now in the "New" economy, we have marketing in charge of sales, with
Chief Marketing Officers, of all things. Four star marketers. Why?
Because form follows funding. There isn't anything especially
brilliant or entrepreneurial about a 25-year-old CMO. There's money.
Lots of VC money. How much? Currently VCs are spending at a $24
billion/year rate in Silicon Valley alone. That's more than the GDPs
of half the world's countries. A huge portion of this river flows
through "marketing." The more "strategic," the better. There isn't a
bigger reality distortion field than a river of money flowing through
an economy demanding nothing more than that others think well of it.
That'll buy a lot of precocious 25-year-olds. And it's as
insanity-inducing as unlimited free cocaine. Think of all the
25-year-olds who aren't starting conventional businesses (that we
need, say, to clean our suits and fix our cars) because they involve
real risk and probably a pile of personal debt.
You want sanity? Step into markets where goods and services are being
sold for profit -- not stock market valuations -- to real customers.
The only solid position to take in these places is on the side of
customers. They have the money that really counts in the long run.
Customers don't give a gnat's ass about business models. Every "worst
company experience" you had last year was a business "strategy" or
"model" of some sort. The car salesman who bothered you on the phone
at home. The unwanted email. The telemarketing calls at dinner time.
The voice mail maze meant to keep you from talking to a human being.
Even the "customer focus" that "delivers" a "customer interface" in
the form of insincere happy-face interactions where human beings
pathetically act the part of policy puppets.
If you really want mental training for industry revolutionaries, go
to a farmer's market in a small town. Better yet (if you're a guy) go
shopping with your wife and girlfriend and watch what *actually
happens* when they bond at length with the salesperson on the other
side of the cosmetics counter, and you *know* the salesperson isn't
just trying to move some lipstick; she's trying to make your squeeze
look good. That's conversation like nothing you'll see anywhere in a
business model other than the one that's been working for 5,000 years.
I think there's a real Trojan Horse in there somewhere.
Best,
Doc
DOC SEARLS
Senior Editor, Linux Journal
do-@searls.com * do-@ssc.com
http://www.linuxjournal.com * http://www.searls.com
(650) 361-1324 * Cell: (206) 849-9586
544 Oak Park Way, Emerald Hills, CA 94062
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