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Tom Peters Making Money … for Our Customers Seagate/08.08.2001
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prior 900 years 1900s: 1 st 20 years > 1800s 2000: 10 years for paradigm shift 21 st century: 1000X tech change than 20 th century (“the ‘Singularity,’ a merger between humans and computers that is so rapid and profound it represents a rupture in the fabric of human history”) Ray Kurzweil, talk april2001
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Forbes100 from 1917 to 1987: 39 members of the Class of ’17 were alive in ’87; 18 are in ’87 F100; the 18 F100 “survivors” underperformed the market by 20%; just 2 (2%), GE & Kodak, outperformed the market from 1917 to 1987. S&P 500 from 1957 to 1997: 74 members of the Class of ’57 were alive in ’97; 12 (2.4%) of 500 outperformed the market from 1957 to 1997. Source: Dick Foster & Sarah Kaplan, Creative Destruction: Why Companies That Are Built to Last Underperform the Market
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Message*: Are all CEOs bozos? Was Darwin a genius, or what? So, Boss Man, whadda you say about “risk taking” now? *And “all that” (2 of 100; 12 of 500) was in relatively placid times.
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Part I: Brand Inside Part II: Brand Outside Part III: Brand Leadership
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Forces @ Work I The Destruction Imperative!
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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
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“Good management was the most powerful reason [leading firms] failed to stay atop their industries. Precisely because these firms listened to their customers, invested aggressively in technologies that would provide their customers more and better products of the sort they wanted, and because they carefully studied market trends and systematically allocated investment capital to innovations that promised the best returns, they lost their positions of leadership.” Clayton Christensen, The Innovator’s Dilemma
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The [New] G e Way DYB.com
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The Gales of Creative Destruction +29M = -44M + 73M +4M = +4M - 0M
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Success Secret #1 No: “Eternal vigilance” Yes: “Eternal skepticism”/ “Honor the assassins”
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Brand Inside Brand Org: Lean, Linked, Internet-driven, Virtual
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White Collar Revolution!
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108 X 5 vs. 8 X 1 = 540 vs. 8 (-98.5%)
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Success Secret #2 Embrace the enormity of the change.
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Brand Inside Brand Work: The Professional Service Firm Model
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So what will be the Basic Building Block of the New Org?
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Answer: PSF! [Professional Service Firm] Department Head to … Managing Partner, HR [IS, etc.] Inc.
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“P.S.F.”: Summary H.V.A. Projects (100%) Pioneer Clients WOW Work (see below) Hot “Talent” (see below) “Adventurous” “culture”
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Success Secret #3 All-groups-as-HVA- players. No “hangers on”.
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Brand Inside The Heart of the Value Creation Revolution: PSF Unbound!
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11 September 2000
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09.11.2000: HP bids $18,000,000,000 for PricewaterhouseCoopers Consulting business!
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[“These days, building the best server isn’t enough. That’s the price of entry.” Ann Livermore, Hewlett-Packard]
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HP … Sun … GE … IBM … UPS … UTC … General Mills … Springs … Anheuser-Busch … Carpet One … Delphi … Etc. … Etc.
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“We want to be the air traffic controllers of electrons.” Bob Nardelli, GE Power Systems
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“Customer Satisfaction” to “Customer Success” “We’re getting better at [Six Sigma] every day. But we really need to think about the customer’s profitability. Are customers’ bottom lines really benefiting from what we provide them?” Bob Nardelli, GE Power Systems
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GE’s New Six Sigma Approach Old view: Out of service 9 days. 4 days are transport, which is client responsibility. New view: ALL 9 DAYS ARE OUR RESPONSIBILITY! Why? 9 days = Client’s World. Source: Steve Kerr, VP, GE
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“UPS wants to take over the sweet spot in the endless loop of goods, information and capital that all the packages [it moves] represent.” ecompany.com/06.01 (E.g., UPS Logistics manages the logistics of 4.5M Ford vehicles, from 21 mfg. Sites to 6,000 NA dealers)
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Springs Collections. Flexible sourcing. Packaging. Merchandising. Promotion. Design. Systems & Site mgt. = Turnkey.
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Success Secret #4 Winners will be full-scale strategic partners in designing & executing CRSs/Customer Revolution Strategies.
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Brand Inside Brand You: Distinct … or Extinct
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Brand You, Big Time! I AM AN ARMY OF ONE
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Success Secret #5 Winners will [empower themselves to] be full- scale strategic partners in designing & executing CRSs/Customer Revolution Strategies.
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Bill Parcells’ World/ Brand You World! BLAME NOBODY! EXPECT NOTHING! DO SOMETHING!
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Brand Inside Redefining the Work Itself: The WOW Project
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“Reward excellent failures. Punish mediocre successes.” Phil Daniels, Sydney exec
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Words: WOW! Insanely great! BHAG (Big Hairy Audacious Goal). Make Something Great. Astonish Me. Make It Immortal.
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“Learn not to be careful.” Photographer Diane Arbus to her students (Careful = The sidelines, per Harriet Rubin in The Princessa)
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Joe J. Jones 1942 – 2001 HE WOULDA DONE SOME REALLY COOL STUFF BUT … HIS BOSS WOULDN’T LET HIM!
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Characteristics of the “Also rans”* “Minimize risk” “Respect the chain of command” “Support the boss” “Make budget” *Fortune, article on “Most Admired Global Corporations”
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The greatest danger for most of us is not that our aim is too high and we miss it, but that it is too low and we reach it. Michelangelo
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Success Secret #6. Remember … The greatest danger for most of us is not that our aim is too high and we miss it, but that it is too low and we reach it. Michelangelo
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Success Secret #6A If you can’t say “big hairy audacious goal” with a straight face, then do Seagate a favor and resign.
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Brand Inside Brand Talent: The Great War for Talent
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“We have transitioned from an asset-based strategy to a talent-based strategy.” Jeff Skilling, CEO, Enron
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From “1, 2 or you’re out” [JW] to … “Best Talent in each industry segment to build best proprietary intangibles” [EM] Source: Ed Michaels, War for Talent (05.17.00)Ed Michaels
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Message: Some people are better than other people. Some people are a helluva lot better than other people.
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“AS LEADERS, WOMEN RULE: New Studies find that female managers outshine their male counterparts in almost every measure” Title, Special Report, Business Week, 11.20.00
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Women’s Stuff = New Economy Match Improv skills Relationship-centric Less “rank consciousness” Self determined Trust sensitive Intuitive Natural “empowerment freaks” [less threatened by strong people] Intrinsic [motivation] > Extrinsic
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“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 day’s events? Who is better at keeping in touch with others?” Source: Selling Is a Woman’s Game: 15 Powerful Reasons Why Women Can Outsell Men, Nicki Joy & Susan Kane-Benson
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Enron COO: Louise Kitchen, F, 29; created EnronOnline as “Skunkworks”
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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, dissenters and rebels.” David Ogilvy
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“Are there enough weird people in the lab these days?” V. Chmn., pharmaceutical house, to a lab director (06.01)
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Talent Leadership Model 24/7: Sports Franchise GM
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33 Division Titles. 26 League Pennants. 14 World Series: Earl Weaver—0. Tom Kelly—0. Jim Leyland—0. Walter Alston—1AB. Tony LaRussa—132 games, 6 seasons. Tommy Lasorda—P,26 games. Sparky Anderson—1 season.
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Why Don’t Most Biz Mgrs. Think This Way? “Coaching is winning players over.” * Phil Jackson *Not: “planning,” “implementing,” “clear communication,” “getting the org chart right.”
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Goal of the Year No. 1*: Find- Develop-Mentor ONE Extraordinary Person. *CEO, large financial advisory firm, April 2001
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Success Secret #7 Talent scouting & development are special skills. Honor them. Reward them. Obsess on them.
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Brand Inside Reprise: THINK WEIRD: The High Standard Deviation Enterprise
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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
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“The highest performing companies have well-developed systems for killing ideas their customers don’t want. As a result, these companies find it very difficult to invest adequate resources in disruptive technologies—lower margin opportunities that their customers don’t want—until they want them. And by then it’s too late.” Clayton Christensen, The Innovator’s Dilemma
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Success Secret #8 Think weird. Partner with weird. Lunch with weird. [Hint: These are weird times.]
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Part I: Brand Inside Part II: Brand Outside Part III: Brand Leadership
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Forces @ Work II The Sameness Trap
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“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
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“We make over three new product announcements a day. Can you remember them? Our customers can’t!” Carly Fiorina
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Success Secret #9 Beware six-sigma parity!
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Brand Outside Strategy 1 : Use E-Commerce to Re-invent Everything!
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Enron eWorld: “Price a structured trade,” per John Arnold, 26: Early 1999: 30 times a day. Late 2000: 30 times per … minute. Long-term gas contract. 1989: 9 months, 400+ deals. Late 90s: 2 weeks, 2 per week. Late 2000: 5 such deals per day Source: www.ecompany.com (1/2001)www.ecompany.com
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A DREAMER’S MEDIUM!
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“There’s no use trying,” said Alice. “One can’t believe impossible things.” “I daresay you haven’t had much practice,” said the Queen. “When I was your age, I always did it for half an hour a day. Why, sometimes I’ve believed as many as six impossible things before breakfast.” Lewis Carroll
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I’net … … allows you to dream dreams you could never have dreamed before!
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“Ebusiness is about rebuilding the organization from the ground up. Most companies today are not built to exploit the Internet. Their business processes, their approvals, their hierarchies, the number of people they employ … all of that is wrong for running an ebusiness.” Ray Lane, Kleiner Perkins
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Success Secret #10 Think big. Think humongous.
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Brand Outside Strategy 2 : It’s the Experience!
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“ Experiences are as distinct from services as services are from goods.” Joseph Pine & James Gilmore, The Experience Economy: Work Is Theatre & Every Business a Stage
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“The [Starbucks] Fix” Is on … “We have identified a ‘third place.’ And I really believe that sets us apart. The third place is that place that’s not work or home. It’s the place our customers come for refuge.” Nancy Orsolini, District Manager
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Experience: “Rebel Lifestyle!” “What we sell is the ability for a 43-year-old accountant to dress in black leather, ride through small towns and have people be afraid of him.” Harley exec, quoted in Results-Based Leadership
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The “Experience Ladder” Experiences Services Goods Raw Materials
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1940: Cake from flour, sugar (raw materials economy): $1.00 1955: Cake from Cake mix (goods economy): $2.00 1970: Bakery-made cake (service economy): $10.00 1990: Party @ Chuck E. Cheese (experience economy) $100.00
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Message: “Experience” is the “Last 80%” “Experience” applies to all work!
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HP Revisited PWC Consultants lead Business Re-invention Process (“Experience Economy”) Fabulous Customer Service (“Service Economy”) Terrific Servers (“Goods Economy”)
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“Experience”: Home to [tomorrow’s] Market Cap!
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Success Secret #11 Think “experience.” Think big. Think humongous.
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Brand Outside Strategy 2A: A Case in Point: The Four Seasons
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Why I Stay at the Four Seasons Chicago Comfort. (“It’s good to be home.”)
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Why I Stay at the Four Seasons Chicago The doorman. (Recognizes me.)
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“The two most powerful things I know in existence: a kind word and a thoughtful gesture.” Ken Langone, CEO, Invemed Associates
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Why I Stay at the Four Seasons Chicago The access to technology is excellent. (I’ve trained them in this!)
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Why I Stay at the Four Seasons Chicago The bottle of Chalone chardonnay they leave for me. (They “remember.”)
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Why I Stay at the Four Seasons Chicago The fact that the GM always puts his desk chair in my room when I’m in town.
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Why I Stay at the Four Seasons Chicago The fact that I feel okay arriving in shorts and a baseball cap. (Even though they serve princes & sheiks.)
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Why I Stay at the Four Seasons Chicago No hairs in the bathtub. (Operational excellence.)
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Why I Stay at the Four Seasons Chicago The Brand. (I trust Izzy.)
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Why I Stay at the Four Seasons Chicago: Payback! It ain’t free.
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Success Secret #12 This “technology stuff” is very cool. But don’t forget the “human stuff.” [It rules in the end???!!!!]
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Brand Outside Strategy 3 : BRAND POWER!
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“WHO ARE YOU [these days] ?” TP to Client
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“Most companies tend to equate branding with the company’s marketing. Design a new marketing campaign and, voila, you’re on course. They are wrong. The task is much bigger. It is about fulfilling our potential … not about a new logo, no matter how clever. WHAT IS MY MISSION IN LIFE? WHAT DO I WANT TO CONVEY TO PEOPLE? HOW DO I MAKE SURE THAT WHAT I HAVE TO OFFER THE WORLD IS ACTUALLY UNIQUE? The brand has to give of itself, the company has to give of itself, the management has to give of itself. To put it bluntly, it is a matter of whether – or not – you want to be … UNIQUE … NOW.” Jesper Kunde, A Unique Moment Jesper Kunde
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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, Tom’s of Maine
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“A great company is defined by the fact that it is not compared to its peers.” Phil Purcell, Morgan Stanley
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“You do not merely want to be the best of the best. You want to be considered the only ones who do what you do.” Jerry Garcia
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“Brand Promise” Exercise: (1) Who Are WE? (poem/novella/song, then 25 words.) (2) List three ways in which we are UNIQUE … to our Clients. (3) Who are THEY (competitors) ? (ID, 25 words.) (4) List 3 distinct “us”/”them” differences. (5) Try “results” on your teammates. (6) Try ’em on a friendly Client. (7) Big Enchilada: Try ’em on a skeptical Client!
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1 st Law Mktg Physics: OVERT BENEFIT (Focus: 1 or 2 > 3 or 4/“One Great Thing.” Source #1: Personal Passion) 2 ND Law: REAL REASON TO BELIEVE (Stand & Deliver!) 3 RD Law: DRAMATIC DIFFERENCE (“Dramatic” = DRAMATIC. Q.E.D.) Source: Jump Start Your Business Brain, Doug HallDoug Hall
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Success Secret #13 Are you very/absurdly clear as to the … “DRAMATIC DIFFERENCE”?
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Part I: Brand Inside Part II: Brand Outside Part III: Brand Leadership
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Brand Leadership Passion Rules!
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Message: Leadership is all about love! [Passion, Enthusiasms, Appetite for Life, Engagement, Commitment, Great Causes & Determination to Make a Damn Difference, Shared Adventures, Bizarre Failures, Growth, Insatiable Appetite for Change.] [Otherwise, why bother? Just read Dilbert. TP’s final words: CYNICISM SUCKS.]
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“You must be the change you wish to see in the world.” Gandhi
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“A leader is a dealer in hope.” Napoleon
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Ben ZanderBen Zander: “ I am a dispenser of enthusiasm.”
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“Create a Cause, not a ‘business.’ ” Gary Hamel, Fortune (06.00), on re-inventing a company (Exemplar #1: Charles Schwab)
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“ Let’s make a dent in the universe.” Steve Jobs
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Have you changed civilization today? Source: HP banner ad
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Sales2001
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The Sales25: Great Salespeople … 1. Know the product. (Find cool mentors, and use them.) 2. Know the company. 3. Know the customer. (Including the customer’s consultants.) (And especially the “corporate culture.”) 4. Love internal politics at home and abroad. 5. Religiously respect competitors. (No badmouthing, no matter how provoked.) 6. Wire the customer’s org. (Relationships at all levels & functions.) 7. Wire the home team’s org. and vendors’ orgs. (INVEST Big Time time in relationships at all levels & functions.) (Take junior people in all functions to client meetings.)
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Great Salespeople … 8. Never overpromise. (Even if it costs you your job.) 9. Sell only by solving problems-creating profitable opportunities. (“Our product solves these problems, creates these unimagined INCREDIBLE opportunities, and will make you a ton of money—here’s exactly how.”) (IS THIS A “PRODUCT SALE” OR A WOW-ORIGINAL SOLUTION YOU’LL BE DINING OFF 5 YEARS FROM NOW? THAT WILL BE WRITTEN UP IN THE TRADE PRESS?) 10. Will involve anybody—including mortal enemies—if it enhances the scope of the problem we can solve and increases the scope of the opportunity we can encompass. 11. Know the Brand Story cold; live the Brand Story. (If not, leave.)
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Great Salespeople … 12. Think “Turnkey.” (It’s always your problem!) 13. Act as “orchestra conductor”: You are responsible for making the whole-damn-network respond. (PERIOD.) 14. Help the customer get to know the vendor’s organization & build up their Rolodex. 15. Walk away from bad business. (Even if it gets you fired.) 16. Understand the idea of a “good loss.” (A bold effort that’s sometimes better than a lousy win.) 17. Think those who regularly say “It’s all a price issue” suffer from rampant immaturity & shrunken imagination. 18. Will not give away the store to get a foot in the door. 19. Are wary & respectful of upstarts—the real enemy. 20. Seek several “cool customers”—who’ll drag you into Tomorrowland.
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Great Salespeople … 21. Use the word “partnership” obsessively, even though it is way overused. (“Partnership” includes folks at all levels throughout the supply chain.) 22. Send thank you notes by the truckload. (NOT E- NOTES.) (Most are for “little things.”) (50% of those notes are sent to those in our company!) Remember birthdays. Use the word “we.” 23. When you look across the table at the customer, think religiously to yourself: “HOW CAN I MAKE THIS DUDE RICH & FAMOUS & GET HIM-HER PROMOTED?” 24. Great salespeople in great technology companies can affirmatively respond to the query in an HP banner ad: HAVE YOU CHANGED CIVILIZATION TODAY? 25. Keep your bloody PowerPoint slides simple!
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Success Secret #14 “ Let’s make a dent in the universe.”
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