Monday, May 29, 2006

A Moment Please, for a Father’s Pride

Every now and then one experiences a moment either professionally or personally that can only be called "kvelling," a word of Yiddish derivation meaning "goose bump pride" or "an end-of-the-world high." It happens, for example, when we have achieved a long sought (nights and weekends) victory for a client, a company exceeds target or has been singled out for special recognition among its peers, or someone you are rooting for in your firm has made unusual gains, showing wisdom and success beyond their years.

I have experienced all of the above, but about a week ago I had such a moment in my personal life. I kvelled as my young son, Evan (aka E-Mak), a sports radio broadcaster, auditioned live for four hours on a major league, major market station to be drive-time morning co-host on an all-sports radio show. A "sports talk jock" since he had his own show in high school, he has always aspired to be outrageous, like "Mad Dog" of "Mike and the Mad Dog" fame, a high-rated and award-winning show on WFAN, the all-sports radio station in New York.

Well, E-Mak’s progress has been incredible! On topic after topic — in and out of sports, hour after hour — he was witty, facetious, interesting, articulate, clever, cutting and challenging … drawing out his co-host, guests and callers as only a ratings-conscious talk show host would do. He kept me glued (ok, so I am his father!) and when I left the room he knew how to get me back quickly. He has all the makings of a great early-stage shock jock. (Father or not, it is a fact!)

Some smart station will grab E-Mak, as his sports reporting career continues to pick up steam!

Monday, May 22, 2006

Dialogue More. Focus Deeper.

Seven years ago, in a speech at a Conference Board workshop, I said, “The age of monologue is over. The Wired World has ushered in the age of dialogue and every company needs to set up dialogue systems over the Net to stay in touch with its audiences.”

At that time, however, I couldn’t even begin to imagine the extent to which the Internet would break down the barriers between companies and their constituencies. There’s a great example in the May 15th issue of The New York Times. In his “E-Commerce Report,” Bob Tedeschi writes about how some retailers are making the multimedia on their websites more interactive.

In addition to the usual product description, price, photos, reviews, warranty information and user manual, has created an interactive demo for some of its higher-end products that enables potential customers to choose how they’d like to learn more about an item … via video or zooming in to view details with commentary provided on short audio clips. Flash animates photos, making them more exciting and engaging. has put the customer in charge. The company is not “monologuing” … it’s “dialoguing” with its customers. It’s giving them the information they want, when they want it and the way they want it. This has relevance beyond consumer packaged goods, for those of us in the service industries.

Like our counterparts in packaged goods, service companies create products in the course of business, as well: reports, special events, surveys, etc. Those of us who are successful are adept at changing our products "on the fly," as client needs and expectations change.

A good example is Booz Allen Hamilton. The global strategy and technology consulting firm created Organizational DNA — one of Harvard Business Review’s “Breakthrough Ideas of 2005” — to give companies an easy way to identify and remedy organizational roadblocks. Visitors to can enter information to obtain a profile of their organization. They are also invited to visit the site for further information about how to resolve any negative organizational issues. In effect, Org DNA is a BoozAllen service offering and a sales lead generator, all rolled into one, and it has captured the imagination of scores of Fortune 1000 companies.

As the Spanish poet Antonio Machado said, “To engage in a dialogue, first ask a question then listen.”

But companies shouldn’t restrict their dialogues with customers only to the Web. My agency’s Quality Commitment Program, for instance, is designed to ask our clients how we’re doing and what we could do better. We solicit written client evaluations of our performance twice a year and match them with written account team evaluations. A Client Review Committee meets monthly to assess the conclusions, identify new client service opportunities and find ways to prevent budding client dissatisfactions from becoming full-blown problems. The program has resulted in an average 20% increase in client retention.

All businesses need to build deeper relationships with their clients and customers (and all of their constituencies!). But we have to engage them, emotionally and intellectually … whether online or offline. We have to ask questions, listen to the answers, really learn, and then act accordingly.

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Monday, May 15, 2006

A Fair Share of Wealth

Just last week, Marc Lane, an attorney and financial consultant, wrote on that “repairing the broken process that allows pay and performance to diverge is probably the most important reform measure on boardroom tables.”

I couldn’t agree more.

One company that is already making enormous strides in this area is Progressive.

One of the nation’s leading auto insurers, Progressive has long been an innovative company in a traditional industry, pioneering online sales of car insurance, offering price quotes from other firms on its website and creating one-stop claims/repair process servicing. Now, Progressive is reinventing the way it pays cash dividends to shareholders.

Like most public companies, Progressive has traditionally paid its shareholders a modest cash dividend every quarter: 3¢ per share since the 3rd quarter of 2004. Starting in 2007, the company will pay a once-a-year dividend based on its after-tax underwriting profit, and the amount will be calculated using the “Gainshare Factor”, a performance score that Progressive currently uses to determine employee bonuses.

Shareholders will receive nothing in a bad year, 20% of the profits in an average year and 40% in a great year. (Had the new scenario been in place in 2004, shareholders would have received about $2.50 a share — approximately 20 times what they actually received.)

This new approach rewards employees and shareholders in years when the company is growing, while preserving capital when it’s most needed and when the company’s financial objectives haven’t been achieved.

“Innovation isn't just about new product,” says Mindy Wilson, who heads the Confederation of British Industry’s business performance group. “It's about the successful exploitation of ideas, both old and new.”

In my opinion, companies like Progressive are showing the way.

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Monday, May 08, 2006

Blogging Policies: One Size Does Not Fit All

Last Wednesday, my firm released the results of the Makovsky 2006 State of Corporate Blogging Survey conducted by Harris Interactive and an accompanying press release. There were a number of fascinating findings, but one of the most surprising for me was this one: Despite the fact that nearly 80% of senior executives with Fortune 1000 companies recognize that their companies should have corporate policies pertaining to blogging, nearly half (47%) currently do not (graph).

Blogs can be a terrific venue to create valuable buzz about a company, strengthening and creating customer relationships, supporting its products, and showcasing its intellectual and human capital. But, conversely, corporate bloggers can also create the potential for liabilities for their companies by breaching privacy, trade secrets, copyright, defamation, securities and a whole host of other laws. In fact, our study revealed that 12% of Fortune 1000 companies have already taken legal or other action in response to a blog (graph).

With the right policies in place, the benefits of blogging can significantly outweigh the potential risks … but what are “the right policies”? There’s no simple answer. Every company has to shape its policies to its culture and the issues it faces in the marketplace. For example, IBM’s thoughtful and comprehensive Blogging Policies & Guidelines are contained in a six-page document that covers a wide range of issues: from protecting confidential and proprietary information to the special responsibilities of managers and executives who blog … from the admonition “Don’t pick fights” to “Don’t forget your day job.”

GM’s Blogger Code of Ethics, on the other hand, is an elegant little five-point manifesto:

  1. We will tell the truth. We will acknowledge and correct any mistakes promptly.

  2. We will not delete comments unless they are spam, off-topic, or defamatory.

  3. We will reply to comments when appropriate as promptly as possible.

  4. We will link to online references and original source materials directly.

  5. We will disagree with other opinions respectfully.
Every company must create — or adapt — its policies to meet its own unique needs. It’s a matter of clearly defining the rights and responsibilities of the company’s blogging community.
Download a copy of the Makovsky 2006 State of Corporate Blogging Survey and accompanying press release to examine the full results of our study.

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Wednesday, May 03, 2006

Behind the Eight Ball?

Survey shows Fortune 1000 Execs are Slow to React to Growing Credibility of Blogs

The results are in. According to the just-released Makovsky 2006 State of Corporate Blogging Survey (and press release), conducted by Harris Interactive, only a tiny minority of Fortune 1000 senior executives are convinced to “a great extent” that corporate blogging is growing in credibility either as a
communications medium (5%) or a brand-building technique (3%).

Nearly half (47%) of the survey respondents say they don’t have corporate policies pertaining to blogging (graph), despite the fact that 77% believe that they should (graph). Moreover, while 12% of Fortune 1000 companies have taken legal or other action with respect to a blog (graph), only one in five (20%) reports having a formal process in place for monitoring blogs written about the company (graph).

The disconnect here is pretty astonishing. Given the fact that blogging can help to make or break a company’s reputation, it continues to surprise me how few corporate leaders are taking the control of their destiny in the blogosphere.

In their book, Naked Conversations: How Blogs are Changing the Way Businesses Talk with Customers, Microsoft blogger Robert Scoble and his co-author Shel Israel write: “Chances are that if people aren’t talking about your company in blogs today, they will be soon. You would be wise to join these conversations, if only to thank those who sing your praises or to correct factual errors.”

Too true!

A proactive approach to blogging is clearly in the best interest of the corporation. The reactive approach — litigation or firing an employee — damages the reputations of everyone involved.

Our Corporate Blogging Survey (and press release) provides an embarrassment of riches in terms of the data. There are too many interesting findings for one brief blog entry … so you can expect more observations from me over the next few weeks about the corporate blogging phenomenon.

Meantime, here’s a selection of other survey highlights:

  • While the vast majority (96%) of Fortune 1000 senior executives say they have at least some familiarity with blogs in general, only 30% report that they have a thorough understanding of the term “Internet blog.” (graph)

  • 21% of senior executives reports reading business-related blogs at least once a week (graph).

  • Just 15% of the Fortune 1000 executives report that someone in their organization is currently writing a blog related to the company or its activities (graph).

  • A bare 3% of execs say their company has changed its products, services or policies because of publicity generated by a blog written about it (graph).

UPDATE: Download a copy of the Makovsky 2006 State of Corporate Blogging Survey and accompanying press release.

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Monday, May 01, 2006

Asking Questions

Who doesn’t know Albert Einstein? This genius — a man who single-handedly transformed our understanding of nature, from the tiniest, invisible particle to the universe as a whole — proclaimed, “The important thing is not to stop questioning.”

I generally like people in business who ask a lot of questions. It tells me they are thinking and probing … trying to get beneath the surface so they can understand as much as possible about a given situation.

Of course, questions have to be raised at the right time. A battery of questions can work if the respondent has dedicated time. But a quick question, and particularly one which might be so strategic and important that the answer could change the direction you take, can be asked almost anytime.

Questions also need to be sensitive. Asking a business question when you are already expected to know the answer can strain a relationship (e.g., "Tell me how you see your position in the marketplace" — on the heels of your firm’s completing an audit of that client). On the other hand, the right question at the right time (prior to an audit) could be one of the keys to winning (e.g., "To what key factor do you attribute your company’s growth?").

Sometimes managers need to ask the obvious question, even at the risk of being redundant, just to satisfy themselves that a fundamental task has been done (e.g., "Did you also mention that to the client?").

Questions can be raised silently or live. If the former, they might be answered through quiet research, via the internet, databases or libraries. With the latter, you get it direct from the horse's mouth. It also affords an opportunity for the respondent to get a feel for your personality and your level of interest, enthusiasm and determination to get it right.

The ultimate aim in business is to win. Good questions that bring useful responses are one of the tools that can help bring victory!

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