Drilling for Diamonds

Western companies struggle to cope with contradictions. Our language is typically bipolar: right and wrong, true and false, black and white.

By contrast, Eastern cultures see opposites not as contradictions but as complementary. Edward de Bono talks about a Western stone culture and an Eastern water culture. Physician Barry Johnson talks about similar issues in his book ‘Polarity Management‘.

Hermann Simon, in his book Hidden Champions of the 21^st Century talks about how hidden champion Gore, the world leader in Teflon based products has included specific polarities in its company’s philosophy.

The principle of freedom allows each employee to do what he or she considers is right. This freedom has limits. It is restricted by the “waterline” principle.

As soon as a decision could hit the corporate ship below the waterline, a colleague must be consulted to share the responsibility.

As Simon puts it, “while the freedom principle encourages all employees to make use of their full potential, the waterline principle is intended to guarantee that the company does not suffer any serious damage.”

Profound advice!

Popularity: 4% [?]

“Those who continue to live by the sword will get killed by a guy with a gun,” says William Watkins, chief executive of Seagate.

Watkins manages a $11.4 billion disk-drive industry which is commoditizing at breakneck speeds. Seagate has no choice. It has to change or face oblivion. Just recently Seagate lost Apple’s iPod business to flash competitors in 2006.

Watkins can see the writing on the wall. Consumers don’t give a damn where their storage comes from - flash or a disk drive.

Seagate is now producing new look backup drives packaged in sleek aluminum cases called Free Agents. These spunky new Free Agent drives come with up to 750 gigabytes– big enough to store 200 movies.

Will Seagate transform itself into a content solution company?

Will Seagate’s die-hard scientists and suits be prepared to make a seismic shift in their thinking?

Popularity: 10% [?]

This is the title of Kevin Clancy and Peter Krieg’s latest book.

The subtitle “How disciplined fact -based marketing can drive extraordinary growth and profits” says it all.

Clancy and Krieg paint a compelling case for treating marketing as a science. The authors show case-study after case-study that instinctive gut-based marketing more often than not leads to dumb decisions. No wonder most CMO’s hold onto their jobs for just 23 months.

All professional marketers should own this book.

My only reservation is most of the examples apply to consumer goods and brands rather than services.

Popularity: 8% [?]

Dominic Dodd and Ken Favaro in their book The Three Tensions tell us about the daily pressure managers have to produce short-term earnings. To meet short-term targets some 81% of managers surveyed said;

“they would cut back on R&D, marketing or IT if necessary to meet a short-term earnings goal.”

More frighteningly;

“77% said they would often, or sometimes delay a project to meet a short-term earnings goal, even if the project would be profitable.”

Dodd and Favaro show the excuse most mangers offer for focusing on the short-term - that capital markets are biased towards short-term earnings - is largely a myth.

Managers create their own problems by projecting unrealistic short-term targets. They would be better off setting realistic goals based on sustainable earnings.

The trick is;

“to manage the long term by managing how the short-term is produced.”

Popularity: 7% [?]

Read this extract from the introduction of a must-read new book The Three Tensions by Dominic Dodd and Ken Favaro.

“A manager argued that he could either increase his business unit’s margins or its sales, but not both.

His chief executive reminded him of the time when people lived in mud huts and faced the start choice between light and heat: punch a hole in the side of your hut and let the daylight in, but also the cold; block up all the openings and you stay warm, but sit in the darkness.

The invention of glass made it possible to overcome the dilemma — to let in the light, but not the cold.

How then, he asked the sales manager, will you resolve your dilemma between no sales growth and no margin improvement?

Where is the glass?”

The challenge for marketers is not to become more profitable or to find new sources of revenue. The challenge is how to do both at the same time.

Popularity: 10% [?]