Archive for February, 2010
February 28th, 2010
You can follow @skmurphy to get these hot off the mojo wire, wait until the end of the month when they are collected on the blog, or purchase the E-book version at http://www.leanpub.com/skmurphy2
+ + +
“When two men in business always agree, one of them is unnecessary.”
William Wrigley Jr.
+ + +
“Your brand is the promise that you keep.”
Kristin Zhivago
+ + +
“Plans are made, unmade, revised, and recast through action and interaction with others on a daily basis.”
Saras Sarasvathy
See also “Saras Sarasvathy’s Effectual Reasoning Model for Expert Entrepreneurs”
+ + +
“Ask for input only if you plan to do something with it or about it.”
Richard Moran “Nuts, Bolts, and Jolts“
+ + +
“Simple ain’t easy.”
Thelonious Monk
+ + +
“One competitor to customer development is a co-founder’s belief that product development, in and of itself, creates value.”
Sean Murphy
See also “Customer Development Proceeds in Parallel with Product Development”
+ + +
“Sometimes I am blocked by things I can see, other times by things I cannot. Too often, it’s just my fear of the unknown.”
Sean Murphy in in “Iron Bars, Plexiglass, and Masking Tape“
+ + +
“From a distance you look like an aircraft carrier, but as you get closer it becomes clear you are really a thousand canoes. ”
Rick Munden recounting a vendor’s description of TI
+ + +
“Opportunity is missed by most people because it is dressed in overalls and looks like work.”
Thomas Edison
+ + +
“The surest way to be cheated is to think oneself cleverer than other people.”
La Rochefoucauld
February 23rd, 2010
- Wikis dissolve voice and authorship. Use them where there are rewards and incentives at a team level, where a team is being held accountable for a result.
- Blogs and forums preserve voice and authorship. Use them where knowing who said what is important.
- Start with frequently updated information that is also frequently accessed:
- Meeting agendas and minutes (avoiding the bottleneck of the designated note taker and/or overlapping amendments in different e-mails that then have to be reconciled),
- Early and still evolving specifications
- Project status in a dynamic environment
- Projects end, products are shipped and end of life, problems get solved. At some point in the business world many wikis must be congealed into a document or document set and either archived, frozen as a static HTML tree, or transferred to a content management system where more formal revision and change control methods are more appropriate. Unlike Internet wikis, older project or product wikis are often better preserved as read only archives.
- Wikipedia anchors a lot of expectations in a use case that is rarely appropriate to a team that is not building an encyclopedia. Hope that useful content will be curated in a general purpose wiki is unlikely to be satisfied.
- Use many small team level wikis, each for a distinct project or purpose, where the team membership is clear and there are shared incentives for cooperation and success.
February 20th, 2010
I covered the EDAC CEO Panel last Thursday for EETimes, what follows is a copy of the article I wrote for them “EDA Chiefs Hazard No Guesses on 2010 Market (02/19/2010 7:12 PM EST)” It differs from the version on-line at EET only in that I have added some links for context.
SAN JOSE, Calif.—With the EDA industry stuck in negative growth, leaders of its three largest firms struck a somber note Thursday (Feb. 18) during a panel discussion at the EDA Consortium (EDAC)’s Annual CEO Forecast and Industry Vision event.Panelists addressed trends affecting industry growth, but left forecasts for the upcoming year to Jay Vleeschhouwer, a senior software analyst with Ticonderoga Securities, who chaired the panel.
Vleeschhouwer predicted “mid-single-digit growth for the year” and was the only one to offer a prediction. Also on the panel were Aart de Geus, Chairman and CEO of Synopsys Inc., Lip-Bu Tan, president and CEO of Cadence Design Systems Inc., Walden Rhines, chairman and CEO of Mentor Graphics Corp, and John Kibarian, president and CEO of PDF Solutions Inc.
Robert Gardner, executive director of EDAC, pointed out that in spite of seven quarters of declining industry revenue, buying a market basket of EDA stocks in Jan. 1, 2009. and holding them for a year would have been a good investment.
While the EDA executives did not speculate on future industry growth, they did offer recipes for growth for their own firms. Tan characterized Cadence as a sales-driven company that is listening to its customers and their need for productivity and profitability. De Geus identified Synopsys as an R&D company that would continue to innovate to maintain leadership. Rhines suggested that Mentor excels at identifying niche applications to allow it to be the leader for those segments. Kibarian positioned PDF as key to semiconductor industry plans to transition to new process nodes at 45 nanometer and below.
Rhines pointed out that engineering headcount growth was 4 percent a year, which might be a constraining upper bound on industry growth unless new market segments can be opened. The panel agreed with the need to explore new market segments, but cautioned that new segments require sustained effort and considerable patience.
In response to question by Vleeschhouwer on whether EDA firms should further consolidate in response to consolidation in semiconductor industry, Rhines said he rejected the premise of the question. He said that in spite of many high-profile mergers and acquisitions in the semiconductor industry it had been on a consistent path of de-consolidation for the past 35 years. He supported this by noting that the market share for the top firm, the combined share of the top five, and the combined share of the top 10 firms had been constant or decreasing over the last 35 years. He added that every decade or so another major technology was driven by a new entrant, allowing them to become a top 10 player. He cited Qualcomm Inc.’s breakthrough in 2008 as the first fabless chip vendor to crack the semiconductor industry’s top 10 as the most recent example of this trend.
When asked by Vleeschhouwer to speculate on growth in the second half of 2010, all of the executives demurred, citing a lack visibility and uncertainty both in the electronics industry and the national economy.
The audience was equally subdued and did not have any questions for the panel.
Updates & Other Coverage
February 17th, 2010
I can always tell when I am feeling stressed because I dream about being back in school taking an exam I haven’t studied for. Although to be candid some of those dreams are closer to suppressed memories than unrealized anxieties bubbling up from my unconscious.
But a year or two ago I had a dream a while ago about a tiger that I keep turning over in my mind.
A tiger is pacing in a cage, but it’s not a square cage, it’s more of a maze.
It’s not in a zoo, more like a warehouse or strangely configured storage unit. The floors are smooth cold concrete.
The tiger is trapped in a maze of walls of iron bars and plexiglass.
The tiger starts out in a section that’s primarily iron bars with a few walls of plexiglass.
It leaps against the bars and can’t break out.
Then it sees what appears to be an opening and runs into a plexiglass wall, which it can’t break through either.
But running into the the plexiglass a few times makes it more cautious.
So it paces,
alternately sniffing and growling,
confused and angry,
trying to find a way out.
Finally it comes to an opening that just has strip of masking tape on the floor.
And there it sits, convinced that this is some new barrier that’s also uncrossable.
Any resemblance to recent legs of your entrepreneurial journey (or mine) is entirely coincidental.
February 16th, 2010
I think that there are better products, impossible products, and unthinkable products.
Better products follow an established trajectory in an industry. They are “15 minutes ahead” and the easiest to sell…for a while. Examples include:
- Faster computers with larger memory
- Cars with better gas mileage
Impossible products find a way to relax one or two constraints that designers of better products have taken as fixed. They are harder to sell, not so much because they are hard to understand but difficult to believe, prospects will ask you “What’s the catch?” Examples include:
- ATM Machines replacing human tellers to dispense cash
- Ethernet over twisted pair
Unthinkable products are typically developed by someone from outside the target industry or are the result of repurposing a product from another industry. Their developers were not handicapped by the mental roadblocks that come from following established practices and patterns in an industry. They can be extremely difficult to get prospects to understand–much less believe in–as they are almost always incompatible with current practices and infrastructure. But they can create an entirely new category of product. Examples include:
- IDDQ testing in semiconductors
- The Reebok Pump shoe
- Henry Ford realizing that a meat packing plant’s “disassembly line” could be run backward to assemble a car.
What are you working on?
See also
February 15th, 2010
Join us tomorrow, Tuesday, February 16, in Sunnyvale where George Grellas will present a short legal guide for entrepreneurs. George is a veteran Silicon Valley startup business lawyer who heads a boutique firm that specializes in early-stage technology startups. Since 1984, as a founders’ lawyer, George has worked with thousands of entrepreneurs in helping them with their strategic planning, entity formation, IP protection, funding, acquisitions–the range of their startup legal needs for both deals and disputes.
George’s style is practical, direct, and down-to-earth, emphasizing a strong working knowledge of technical issues (including tax) explained in a manner that is made understandable and helpful for those new to startups as well as for seasoned entrepreneurs. He is the author of the Startup Law 101 series of tutorials for founders and entrepreneurs.
Bring your questions for George and the other entrepreneurs around the table. As always, there will also be time for your general questions and concerns.
Update Feb-17-2010: George made some thought provoking opening remarks on his visit, in particular:
Startups are interesting. It’s a rather grim time in a macro-economic sense but for early stage startups it’s a pretty amazing time because the infrastructure has been built out. There is a lot of opportunity to launch companies creatively without the capital intensive needs that were there a decade or two ago.
Of course there are many situations where you have capital intensive needs and that occupies the traditional VC realm. But there is a huge and expanding area in the last decade, and the last few years in particular, where with creativity and innovative focus on areas like enterprise people can leverage very interesting business models in ways that used to be unthinkable without a lot of money.
Related Links:
February 13th, 2010
Colin Cherry in “The Telephone System: Creator of Mobility and Social Change” makes the point that the full impact of an invention is very difficult to predict (emphasis added).
Inventions themselves are not revolutions; neither are they the cause of revolutions. Their powers for change lie in the hands of those who have the imagination and insight to see that the new invention has offered them new liberties of action, that old constraints have been removed, that their political will, or their sheer greed, are no longer frustrated, and that they can act in new ways. New social behavior patterns and new social institutions are created which in turn become the commonplace experience of future generations.
Such realization does not come easily, quickly, or even “naturally,” for the new invention can first be seen by society only in terms of the liberties of action it currently possesses. We say society is “not ready,” meaning that it is bound by its present customs and habits to think only in terms of its existing institutions. Realization of new liberties, and creation of new institutions means social change, new thought, and new feelings. The invention alters the society, and eventually is used in ways that were at first quite unthinkable.
I think that we are now at a transition point in our use of web applications: the larger challenge for software entrepreneurs is not inventing a new technology, but determining how to apply the last two decades (Tim Berners-Lee had the first webserver working in 1990, SLAC had one in 1991) of invention to business problems in new ways, many that would have been unthinkable earlier.
This is what customer development helps entrepreneurs to understand: how to apply inventions to problems that customers will pay them to solve.
February 10th, 2010
Companies names have sure changed in the last year or so. I was noticing today how many signs outside of office buildings seem to be branch offices for these firms:
- Move In Now
- First Month Free
- Your Name Here
- Available for Lease
- Space for Rent
Here are two directories that list available office space for Silicon Valley:
We use Pacific Business Centers and have been happy with them.
February 9th, 2010
Three true stories:
We were driving back from a sales call and the CTO said “I don’t understand. We won the argument. Why didn’t we win the sale?” He was very disappointed at their stupidity and stubbornness.
Different startup, I had been recruited by a new CEO as a part of a turnaround. A team had gone off to meet with a new prospect and I asked the sales rep how the meeting had gone. He said “It was one of those meetings where the actual purpose of the meeting became figuring out who the smartest person in the room was: one of our guys or one of theirs. After a while it was time to leave.”
About a decade ago while I was still at Cisco I got invited to a large meeting with an outside vendor. Cisco had two software vendors providing similar but incompatible tools that solved the same problem in different ways. Times were tight: folks were being laid off and projects were getting canceled. Our inability to be able to share scripts and models between these two tools meant that management had decided we needed to standardize on one. This was a meeting for all of the supporters of tool A to compare notes and develop a common set of reasons why it should be the standard. The vendor sent a large contingent and there were perhaps two dozen engineers from different groups who were concerned. What a disaster. The vendor essentially started off by implying that the users had done a poor job of educating management as to the value of the tool and listed a number of improvements and techniques that they had “taught” us. After perhaps ten or fifteen minutes, someone spoke up and said, “Hey, wait a minute, that was an idea that we gave you! You incorporated into version 7, but we had that first.” The meeting degenerated into an angry shouting match and the default plan became engineers would refuse to switch to the other tool. Not a winning strategy in a downturn as it turned out.
Diagnosis: in each case the startup didn’t view the customer as a partner, and somehow believed that they would succeed by convincing them that they were smarter. This is called the “bringing fire to the savages” sales and marketing model. Variants include viewing your product as a luxury good “not everyone can own our product” or an IQ test (“not everyone is smart enough to be able to use our product”). None of them are particularly effective in generating revenue or reference customers but they do preserve the world view of the founders that they are all a bunch of really smart people.
Three specific antidotes:
- Focus on understanding the customer’s problem. Make sure you can describe their problem before you start to describe your solution. Test for other symptoms that they have not mentioned that you have heard from other customers. Do all of this before you mention any features or benefits of your offering.
- Understand specifically what steps they have already taken to address the problem and what constitutes their perception of the status quo.
- When you propose your solution, make it as compatible with their current work process and practices as you can, and incorporate any of their ideas into your product roadmap that you believe may benefit other customers or prospects. This minimizes their transition cost and their sense of loss.
We help software firms explain their new product to the right prospects in ways that convince them to become reference customers. If you have a new product and are having difficulty getting people to understand what it can do, please give us a call: we can help.
Related posts:
February 8th, 2010
I was pleased to see that Verdafero, a firm we have been advising for about a year, was selected last Friday by the San Jose Business Journal for their “The Pitch” column. The article, “Palo Alto’s Verdafero Offers Sustainability Planning Over the Web,” ran in the February 5th print edition:
THE BUSINESS: Verdafero has developed a software-as-a-service platform that can be used for sustainability planning, energy efficiency and carbon management services for small and medium enterprise businesses. Customers use the tool to develop a sustainability plan by analyzing best practices and specific savings potential in their energy and material use as well as the environmental impact of their products and associated waste byproducts. Verdafero says it helps its customers stay ahead of supplier approval requirements, increase competitive advantage and improve profitability through cost reductions across their business operations.
MANAGEMENT TEAM: CEO Merc Martinelli is a certified sustainability consultant and previously worked at Cisco Systems Inc. where he led the new product introduction department within the enterprise line of business. Chief Operating Officer Alastair Hood is a business, technology and energy efficiency consultant, and he has worked with emerging companies in the U.K., Ireland and Australia. Previously he worked at Agilent Technologies Inc. and was a founding team member and development director of Nanosight Ltd., a U.K. nanotechnology startup, where he helped raise in excess of $10 million in startup funding.
A note on the name Verdafero: In the global language Esperanto: Verda = Green and Afero = Business. Verdafero™ – We Green Business.
Related posts
- Visualizing Sustainability a list of 138 different visualizations of sustainability. Hat tip to David Sibbet who notes “a full panorama from simple to complex, mapping onto every conceivable base map. I’ve contended for a long time that a sustainability mindset requires systems thinking, and that systems thinking requires visual thinking—even if the display is just between your ears.
- Green Software Unconference
Previous Posts