Posts filed under 'Rules of Thumb'
March 18th, 2010
In “Moore’s Law Beats Customer Feedback” Chris Morris highlights a quote by Jensen Huang from an April 8, 2009 talk at the Stanford Technology Ventures Program on “Favoring Moore’s Law Over Customer Feedback“ (Mr. Huang has a number of talks available on Stanford’s Entrepreneurship Corner):
Sometimes you have to ignore your customers and follow Moore’s Law.
My feeling is that Moore’s Law is customer feedback.
What I think he means “ignore some of your more established prospects.” NVIDIA sold chips to customers in its first five years. By that I mean that they had customers that were using their products. Just not to some of his larger potential prospects. NVIDIA also had SGI as an “existence proof” for a market for high end graphics. They had lead customers from the beginning, he doesn’t mention who they are, choosing to focus on the larger prospects who were initially not interested, but they didn’t invent their architecture in a vacuum. For example, from Firing Squad’s History of NVIDIA:
Curtis Priem, NVIDIA Chief Technical Officer, had been the architect for the first graphics processor for the PC, the IBM Professional Graphics Adapter, and more recently had developed the GX graphics chips at Sun Microsystems. Chris Malachowsky, VP of Hardware Engineering, was a Senior Staff Engineer for Sun Microsystems, Inc., and was co-inventor of the GX graphics architecture.
In fact, when it came to standards for representing 3D they initially picked the wrong standard and had to “listen to their customer” and change horses. See, for example Tom’s Hardware: 13 years of NVIDIA History:
The principal problem with the NV1 was in its management of 3D: it used quadratic texture mapping (QTM) instead of the technique used currently, which is based on polygons. DirectX appeared just after the card was released, and it used polygons, so the NV1 was a failure over the long term. [...] The NV2 used the same rendering method and was never completed. It was to have been used in the Dreamcast console (which replaced the Saturn), but Sega finally chose a polygon-based technology (PowerVR) and Nvidia abandoned QTM in favor of polygon-based rendering with the NV3.
My take away is that if a large established customer shows no interest, talk to smaller players who are interested in becoming larger and help them to disrupt the market. Don’t wait for the established players to embrace your product idea before proceeding.
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 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 2nd, 2010
Literature is mostly about having sex, and not much about having babies; life is the other way round.
David Lodge
Startup pundits have focused primarily on funding events and product launches, and not much about how viable the business model and scale up strategy are. Successful businesses are the other way around.
Jeff Nolan wrote in January 2009 about “Why the TechCrunch Economy Will Falter” noting (bold in original):
“…a fundamental flaw in the startup economy promoted by a wide swath of pundits and proponents, that starting is more important than sustaining.”
Martin Edic in the comments noted that
The other half of this situation is the ‘pundit’ sites lack of aggressively asking companies exactly how they are going to make money. Endless coverage of start-ups that are more about a gimmick, reiteration of an original technology or an imitation of something else, without questioning the viability of the business model, helps create an environment where typically young entrepreneurs scoff at the need for revenue. When we hit a downturn like this and funds dry up, they are going to fold.
The good news it that most serial entrepreneurs fail at least once and return as much more knowledgeable and pragmatic business owners. So covering failure has its purpose.
It’s taken a little more than a year but Dave McClure notes yesterday in “Subscriptions Are The New Black”
We have largely WASTED an entire web decade of time, energy & venture capital on extremely inefficient revenue models. There have been a few interesting examples of startups acquired in the 00’s for large amounts due to amazing growth (eGroups, MySpace, Skype, YouTube) or advertising potential (aQuantive, DoubleClick, AdMob, RightMedia). However, mostly the decade has been an uninterrupted string of uninspiring business models and small-time acquisitions of Web 2.0 startups filled with rainbows & unicorns, rather than those based on simple, transactional revenue models.
and he posits two key assertions related to startup business models:
- The default startup business model from 2000-2009 was based on growth (aka acquisition) and CPM- or CPC-advertising
- The default startup business model for 2010 & beyond will be subscriptions and transactions (e-commerce, digital goods).
What does this mean for the average bootstrapping entrepreneur?
- More competition as fewer teams bet on “build it and they will come” models and start competing to deliver services that firms or individuals will pay for today.
- Perhaps less derision when they tell other startup entrepreneurs that they plan to charge right away.
- Craig Newmark’s answer “Our history is slow, continuous growth. In the race between tortoise and hare, well, we’re the slow guy” to “How Craigslist Spread” is worth keeping as your screen saver quote.
Related posts
January 19th, 2010
Great post by Lindsay Robertson on “The Do’s and Don’ts of Online Publicity, For Some Reason” where she lists nine rules of thumb for getting publicity. Here were my top three from here list (numbers are from the original: read the whole thing):
1. FOR IMMEDIATE RELEASE means FOR IMMEDIATE DELETE to any blogger with any influence. Period.
3. A blogger’s resistance to marketing/publicity is directly proportionate to his or her influence as a blogger.
4. A Monkey Can Send a Mass Email: Build Relationships and Understand What Your Real Job Is
Some related posts:
January 4th, 2010
SKMurphy was interviewed and selected as one of a dozen case studies on Document Management Solutions for Consulting Groups by Central Desktop. Read about our innovative approach at “Document Management Solution helps SKMurphy Consulting Group Increase Productivity.”
We make some strong claims in the case study:
- Increased productivity – approximately 5 to 10 times more productive
- Significantly sped up decision making time on projects
- Eliminated version control issues for faster review cycles
The baseline is E-Mailing documents and phone tag. We rely on the edit lock that Central Desktop show to prevent you from editing the same file at the same time as someone else (this happens more than you might think as you get close to a deadline) and find that setting update notification for two hours encourages other members of the team to contribute.
We use Central Desktop to work with all of our clients and have found that it allows us to respond with drafts much more quickly and to achieve a working consensus in a few hours to a day or two. We use it to rapidly prototype the content for key E-Mails, presentation outlines, datasheets, backgrounders, and other content or documents that are used in the sales or customer engagement process by our clients. Each of our clients has their own password protected workspace, as well as any attendee at a workshop who wants one. We also use them for projects with our partners.
We think this approach offers them the following benefits:
- The workspaces are searchable and both the wiki pages and attached files are under version control so they good visibility and control over our joint work product, whether it is in planning stages, in process, or had been delivered.
- Meetings and conference calls are more productive. We use the same wiki page can be used the agenda, notes in process during the meeting, and for minutes and action items afterward. There is one place to look for anything about a meeting and it can have hyperlinks to other content that was discussed. This is an order of magnitude more productive than reconciling a stream of E-Mails for agenda and minutes.
- The workspace is the first place to look and it’s more easily organized than anyone’s inbox. It’s not uncommon for us to run a Skype text chat session for conference calls and append that to the meeting page as well. This is a lightweight approach to making meetings more productive and because things get documented immediately you have more of a complete archive as you add folks to the team or want to look back in two or three months to see what was decided.
- We normally include the cost of Central Desktop in our engagement fees but have turned over the workspace to clients at the end of an assignment. One client we worked with in 2006 through 2008 had more than 550 pages and attached files in the workspace.
We have been working in wikis since we started in 2003. We chose Central Desktop in 2006 and phased other wiki platforms out except where a customer is already using one. We have more than a hundred distinct workspaces (some are archived) that have been used with clients, workshop attendees, partner projects, and internal projects.
We are happy to have a phone conversation if you are interested in trying to incorporate them into your business: Sean has given a number of talks on them as well if you would like a briefing or presentation for your group or event. We do not resell Central Desktop and we were not compensated by them for the case study: we agreed to talk about it because we have been satisfied customers for more than three years.
Related blog posts on wikis:
December 31st, 2009
Quoting myself a lot this month, evidence for something. I will have to look back in a year and see how many are still useful. Quotes are streamed at http://www.twitter.com/skmurphy and collected at the end of the month in a blog post.
“Facing a mirror you see merely your own countenance; facing your child you finally understand how everyone else has seen you.” Daniel Raeburn from “Vessels”
- Hemingway’s shortest story: “For sale: baby shoes, never worn.”
- Raeburn’s is as heartbreaking: “Irene Raeburn: born December 28, 2004, died December 24, 2004.”
“Lots of guys came and went who had way more talent. Talent doesn’t matter all that much. You gotta show up.” Gregory Sullivan in “Carpenter Poets”
- Context and full quote: “We were the opposite of the stereotype. We weren’t frustrated musicians working menial jobs waiting for our big break in music. We liked our day jobs and played music for a little money and some laughs. Only the contractor types were worth a damn anyway, as far as music. A real music job is very much like a building contract. You have to plan, and show up on time, and stay sober, and understand the logistics of the equipment. You have to be able to set up and repair your broken tools on the spot. You have to work closely with others. You have to figure out in advance what the customer wants, and deliver it skillfully. [...] We had lots of guys come and go that had way more talent than many of us that stuck. Talent don’t matter all that much. You gotta show up.
“Startups survive by doing less with less. They live on the scraps of a market that larger competitors ignore.” Sean Murphy
“Never compare your inside with somebody else’s outside.” Hugh MacLeod (hat tip to http://twitter.com/jnash )
“Pay close attention to the short descriptions of your product that early customers offer others. This is your ‘elevator pitch.’” Sean Murphy
“What The Cloud provides is opportunity–a way to reduce the cost and risk of trying out service innovations.” Bob Lewis
- What The Cloud provides, for companies with the wit to see it, is the opportunity to reduce the cost and risk of trying out service innovations. Focusing on IT’s ability to manage it … to control it … is a great way to make sure only your competitors take advantage of what it has to offer.
“Customer Development proceeds in parallel with Product Development, and informs it.” Sean Murphy
- Full quote from a comment I left on Steve Blank’s blog
As soon as you can clearly articulate your hypotheses about the customer’s problem you should get out of the building and start having serious conversations. Customer Development proceeds in parallel with product development and informs it. One piece of paper with a prospect’s name and a few questions can communicate that you care about their perspective and have given some thought to making it a productive 10-20 minute conversation (if they want to talk longer you should let them, but you should be able to finish a short conversation in ten minutes or so).
“You don’t get to say who you are, your behavior speaks for you.” The Last Psychiatrist (pseudonym)
“Startups should leverage their size by promising intimacy and delivering it in every relationship with prospects and customers.” Sean Murphy
“Character is what emerges from all the little things you were too busy to do yesterday, but did anyway.” Mignon McLaughlin
“The wisdom of life consists in the elimination of non-essentials.” Lin Yutang
- Full quote: “Besides the noble art of getting things done, there is the noble art of leaving things undone. The wisdom of life consists in the elimination of non-essentials.”
“The novice can see things an expert overlooks, he is not afraid of making mistakes or appearing naive.” Abraham Maslow
- Full quote from Eupsychian Management “I have learned the novice can often see things that the expert overlooks. All that is necessary is not to be afraid of making mistakes or of appearing naive.
December 1st, 2009
We use eReleases which distributes over PR newswire for about half the price ($400). See http://www.ereleases.com/submit.html for details, we have been working with them for more than two years and been very pleased. [Note to anyone from the FTC reading this, this is not a paid endorsement nor have we gotten free goods or services from eReleases. We are genuinely satisfied with the service and quality of results the eReleases team has delivered for us and our clients].
Press releases are not appropriate for every startup’s marketing communication: you need to make sure that you have the right message before you broadcast it widely. One of the advantage of doing individual interviews in the customer discovery and validation phases is that you can tweak your message between each conversation.
You will need to experiment and understand what keywords in the title and the first paragraph make them more likely to get picked up by relevant publications. It’s also more compelling to include a quote from a third party (typically a customer) who can validate/substantiate one or more of the statements you are making. You can think of them as larger and more expensive Adword ads.
We have seen excellent results (increased SEO, direct sales inquires) from well written press releases. But, like an adword, the lack of a compelling title or poor first sentence can have them fall flat.
I would not send press releases to bloggers (who have not signed up for press release distribution through one of the services) but work with them on an individual basis. Identify blogs who address an audience you are trying to reach and leave substantial comments: not “look at this link” but one to three sentences of relevant content that responds meaningfully to the blog post you are commenting on. You can also approach bloggers to see if they are interested in a short interview or Q&A with one of your team.
If you are bootstrapping your startup you need to focus on where your efforts will do the most good: analyze what publications or websites are most likely to attract the audience that you want to reach and laser your efforts towards them. Relationships take time to build so plan your efforts for a set of activities you can sustain. If you are in the early customer discovery phase there are almost certainly bloggers who knowledgeable about the market you are targeting and who would be willing to give you ten to twenty minutes on the phone to give you feedback on your product idea.
November 15th, 2009
If you are updating your website, here a couple of things you want to make sure you do:
- Add Google Analytics to your new pages.
- Add permanent redirects (HTTP 301) for any pages you have moved/renamed to preserve search engine ranking.
- View your website on multiple browsers (at least the latest versions of Internet Explorer and Firefox).
- Run Website Grader to get a short fix-it list for things you may have overlooked.
- Run a spell check on any pages you have added or updated; we use spellr.us.
Update Nov-17 Andy Wright of Elevensoft suggests “I’d also check for broken links and check that your markup is valid.” Two good suggestions which prompt me to add
- Google’s Webmaster Tools offer a number of good checks: in particular the “Crawl Errors” and “HTML Suggestions” diagnostics. Like Google Analytics it’s free.
Update Nov-20: Colin Warwick suggests “Xenu’s Link Sleuth is another good broken link checker. It’s an app that you install.”
November 8th, 2009
Ben Foden has been working with us part time; the following is a blog post he developed on creating genuine connections with social media.
“Remember that the goal of all social media interactions are to create genuine relationships… so when you connect with someone that may be a good contact for you, move to offline (email, phone, in-person, etc) to create a deeper communication and stronger relationship.”- Joseph Ranseth
For business owners, the strength of their relationships is one of their most important assets. “It’s not what you know, but who you know” still holds very true with all of the new tools available for meeting and connecting with people.
As someone interested in pursuing further social media awareness and connection, I will cover the best platforms, key things to be aware of, and specific actions to take before engaging.
In the grand scheme of social media there is a hierarchy of genuineness — not all social media sites are equal in their level of spam, noise, and lack of ROT (return on time).
From most genuine to least, here are the most effective destinations for business people online:
- Industry and other Relevant Blogs
- LinkedIn
- Twitter
- Facebook
- Docstoc
- SlideShare
Others : MySpace, Digg, StumbleUpon, Flickr, YouTube, and many many more.
Let this list function also as your order of priority when dealing with a very limited time schedule and still attempting to make social media connections.
Why are blogs above LinkedIn? Most bloggers don’t get that many comments and will greatly appreciate one that addresses one of their blog posts.
With a nod to Octane’s Report on Social Media there are five things to bear in mind when striking up conversation within social media.
- Keep in mind your target market, Ask “Who am I writing this to (and why)?”
- Always reach out to individuals with a personal and relevant message rather than the template approach– The default “I’d like to add you to my professional network on LinkedIn” is not cutting it.
- Keep your professional head on at all times (obviously) — no flame wars, no extended arguments, etc.. Ask “Would my mother be offended by this?”
- Rather than pushing an agenda, monitor these sources periodically and respond, respond, respond. The value is really created when you engage a customer, partner, or niche in their time of need.
- Update as consistently as possible whether weekly, daily, or more often as appropriate for each service.
When it comes to updating your profiles with content and putting some value out into the world, the Golden Rule still applies. Also:
- Try to inject your expertise into larger topics and debates, to offer useful advice to individuals whether in the form of a blog post or comment, tweet, LinkedIn Question, Facebook status, or other formats.
- Share things that are funny, informational, insightful, or otherwise significant.
- Tell people what you are reading, working on, or care strongly about.
- When adding content anywhere, ask: “Is this something I would like to hear about?”
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