The 5 star rating Hunger Games – it’s a dystopian fight to the death to survive. (i.e. keeping your Amazon/ Uber/ TripAdvisor rating up)

The Hunger Games is a series of films/books about a consumer driven TV focussed society where people fight to the death in an arena controlled and manipulated by a shadowy organisation where they have little chance of success and there are frequent rule changes. Remove the arbitrary slaughter and Jennifer Lawrence and I think it has eerie parallels with the world of product rating on our favourite websites.

Now, we all live in a world where a rating drives your decision making. The broad idea is that a huge range of customers sharing their opinion and scores helps you to find the best product, the best service and generally forces suppliers to improve what they offer. You look at the reviews (usually out of 5) and then pick accordingly. In reality, what this means is that a bad score means disaster – an Uber driver with a score of 3.5 you assume has dogs in the car and swears whilst he smokes and a TripAdvisor rating of 3.5 is probably an unfinished flea ridden concrete box hotel beside a major motorway.

The trouble is, as with any game where the stakes are high, what starts as a even playing field immediately leads to everyone looking for an advantage through any means possible. Furthermore, in this case the referees have skin in the game. (i.e. Amazon also sells products, Trip Advisor = Expedia).

Accordingly, what started as an experiment in democratised opinion sharing has morphed into a life or death fight for a rating number which doesn’t always get it right and might cost your existence. Here are three companies I volunteer as tribute (Hunger Games reference) to prove my point.

The begging and pleading of a small toy company – imagine you launch a product tomorrow and put it on Amazon. One of your first orders comes in and the customer (an unreasonable man desiring a Christmas present for a one year old) is unhappy that the product isn’t delivered in the promised time. A follow up request for a rating is met with a zero star rating (the man didn’t get the product yet). The score for the product drops to 2 stars and the product is never bought again ever by everyone. What lunatic buys a two star??

The unprincipled monster in this story is me and my rating was met with the following response (paraphrased loosely).

Dear complete bastard, I am a small company and I have 12 children to feed none of which will be able to wear shoes in the harsh winter due your rating destroying my credibility and in course my livelihood.  Please reconsider changing your rating and I will light a candle in your name every Christmas. Here is the link on ______ to change your rating. God bless us everyone.

I received the product, changed the rating to 4 (how could I not). Company is saved. Shoes for everyone.

I’m only exaggerating a little in the above . There is an incredible power of a rating which has led to the rise of a new type of strange personalisation in service. People will actively chase the rating in preference to anything else – e.g. ‘I don’t have my product’ is not seen as urgent until it translates to zero stars. Honourable mentions in this category for Dominos delivery ratings (the manager has to personally phone you if you rate them a poor score) and just about all Uber drivers. (who also know where you live).

The ‘Featured Rating’ con-trick – trendy mattress company – I recently bought a mattress online for which one of the selling points was commentary on the ‘excellent unboxing experience!?’. The mattress was delivered within 24hrs 2 days before Christmas (in a box, there was no lie) and having taken advantage of the 100 day sleep guarantee, we sent it back because the chemical smell after 3 weeks remained overpowering  (as a separate point, if you look at the small print, most mattress companies suggest you air your mattress outside for a day or two before you put it in your house. This does make you wonder what’s in it and what liability they are trying to avoid). Nonetheless, the mattress was taken away quickly no questions asked and a very nice follow-up email was sent thanking us for giving them the chance.

My feedback; 5/5 for service, 1/5 for the product, 3/5 for the ‘unboxing experience’. A few lines saying something similar to the above also went up. A few days later, a line of my feedback went up on their site. ‘amazing customer service and delivery especially just before Christmas…….’ On closer investigation, if you look at the website rating, what you are shown on the first page is their ‘featured ratings’ which are all 5 stars and glowing. In order to see the other ratings, you have to physically click on the stars you want e.g. my 2 star one to see the full version.

We are used to seeing the ratings in chronological order but increasingly, you can see selected comments appearing at the top, Youtube in particular. You can assume it’s not long before you see these monetised. E.g. to pin 5 ratings of your choice at the top, give us $5 a month or even more interestingly, give a $5 to remove a rating. It’s already happening on TripAdvisor.

The ‘feedback is important to us’ squeeze – given the power of the rating, no-one wants a bad score so when the possibility of a good score appears, people will jump on it quickly. The best example is to take a cruise and enter into a world of the American feedback hunters.

Over the years, incentives and rewards have moved away from sales onto service. The complaints over mis-selling in Financial Services or over-zealous salesmen (it’s always men in my experience) have changed the dynamic of salespeople. However, there are obvious rewards for good service built into remuneration so you get the following decision tree; I tried this out in the most service intensive place I’ve ever been; a cruise boat on the Mediterranean.

‘It has been my pleasure to serve you on the boat this week’ – RESPONSE – thank you so much, you’ve been great – FOLLOW UP – ‘feedback is important to us – here is a form that I’d love you to fill in about my performance this week.

OR

‘It has been my pleasure to serve you on the boat this week’ – RESPONSE – yeah, it was fine – FOLLOW UP – ‘please enjoy the rest of your day and safe journey home’

Even more fascinating was the feedback form when we got home. One of the questions asked ‘did our staff ask you directly for positive feedback’. This is clearly an issue that they know about but I could still answer ‘no’. There is an investment in getting the good ratings which means feedback is skewed away from bad to good. You can see this in the general ratings people give, a 3.0 rating is catastrophic and even a 4.0 is starting to feel a bit low.

What does it all mean?

It is now as it has ever been, companies are smart in their marketing and approach to take account of how customers make decisions about their products. What has changed is the platforms behind managing the ratings and the anonymity of response meaning that you will take advice from people you don’t know, will never meet and no doubt have different lives and personalities. The companies themselves are also driving what you respond to and therefore what is considered important. For example, someone has decided the ‘unboxing experience’ is an important to the overall rating as the product itself, a 10 year mattress purchase vs the first 20 seconds. Companies act accordingly.

If you are a consumer, you need to be increasingly wary of looking at scores and look at what comes behind it. You have to run your own analytics strategy to build your own sense of what is good or bad. My approach is to trust no-one who gives a 1 or a 5 and spend my time looking at 3s to look for trends.  If you are a retailer/supplier, you need strategies to play the system and position yourself in the best way. As with anything, you need adapt your behaviour to focus on what is being measured. This might mean pushing on personalised service or keeping a much closer eye on the immediate stage after the sale and to get the timing for the feedback right.

I recently moved countries and had some removal guys round to pack up our furniture. The feedback form was handed to me whilst the three huge guys were stood behind me and every item of glassware and anything fragile still to be taken to the truck.

My feedback – glowing. My furniture – still on a boat in the Indian ocean.

www.thecorporatefuturist.com

PS I’ll leave you with the best rating piece of gamesmanship I’ve seen. Have a look at this and tell me what rating the Guardian gave the film.Guardian - krays

The Travel Agent for millennials: a lesson in digital customer experience from Europe’s smartest tourist agency

In a recent release from the Rough Guide people, the country voted the most beautiful in the world was the perhaps unexpected Scotland (my home country). Not making the top 20 was Australia (my adopted country) which was subject to some discussion and debate. I myself can vouch for how nice Manly Beach in Sydney is on a Spring morning vs a wet February day in the old country but the heavily young readership of the Rough Guides don’t lie so the title is Scotland’s.

Now it’s not just the pretty pictures that get the job done. It’s worth saluting the people at VisitScotland (who have some serious game) who have the customer experience right in the middle of their thinking. Namely;

–         Focus on creating moments

–         Build an adventure and an experience

–         Be authentic and unique and let people do the work for you

–         Be smart in the engagement

 The Instagram Travel agency

Let’s start with something really clever. In late October, Visit Scotland set up a Instagram Travel Agency in a physical location in London. Believe it or not, Scottish tourism has the biggest Instagram following of anywhere in Europe (which is extraordinary if you think about it) and of that following, the biggest group is from London.

What they did was to create an Instragram wall in a physical shop with a range of photographs from which people picked their favourites and the agents were there to build an itinerary for you based on those picks.

https://www.visitscotland.com/blog/events/instagram-travel-agent/

So what?

Here is where knowing your customers is pretty smart. The number one problem for Scottish tourism is the weather. There is no guarantee of good weather at any point of the year so it is always a lottery. Going back to Australia losing out in the top 20, you could reasonably expect Sydney to have better weather on 350 days a year vs Scotland so if you are planning a trip for three weeks, you’d be smarter to pick Oz right?

Not anymore for the Instagram generation. There is an incredible desire to create ‘moments’ which you can record and share. Finding a perfect moment becomes a primary objective to judge the success of your trip. Now, for Scotland this is perfect because in between the rain or the clouds, you will always get a few pictures of astonishing beauty.

It is for this reason that Scotland is Instagram’s biggest fan.

The North Coast 500

I saw recently that a friend on Facebook had completed the ‘North Coast 500’ which I had never heard of. Having looked at the pictures and had a look at the website (which you can too) I discovered that it is in fact a brand new creation of a Scottish ‘Route 66’ in the far north coast (An area which is not renowned for large visitor numbers). It has been created from nothing as an adventure, you can subscribe be a ‘member’ which includes a £250 gold package with free merchandising, offers, a bottle Scottish gin etc, but importantly, a regular update on what is happening and access to a special ‘club’. It has also been simplified beautifully to make it easy to plan. Pre-set itineraries – basic to luxury, different sections; top, bottom, all. Themes; adventure, relax, indulge

It has been created in the way you would create any modern product to sell. ‘This is our most popular package’, ‘simple click to plan your route’, ‘interactive map (Instagram connected)’, ‘Aston Martin driving experience’ (message; it’s a dream for driving and doing it in your 1998 Nissan Micra will be just as good).

Having never been to this area in my 30 years living in Scotland, I am now as an outsider furiously desperate to go.  This is not how you’d typically sell tourism but….increase in numbers 29,000, £9m extra investment which is a big number for a pretty remote and not commonly visited.

It’s an experience, it’s simple to buy and you can be part of a community

https://www.northcoast500.com/

 #scotspirit

For a few years now, Scottish tourism has been desperately pushing a hashtag friendly motto to encourage engagement. #homecoming  #scotspirit  and even changed the name of the tourist board to the twitter friendly  #visitscotland.

Personally, I thought they were trying too hard but I’m wrong. The Instagram following is around 400k and as with any good social media, it is a virtuous circle of the community feeding more pictures which encourages more interest and engagement.

The plan for this year at Scotland’s marquee day Hogmanay (New Year), is to use real people from amongst the 20,000 carrying torches to spell out a giant #scotword with a word to be selected by a vote from the people of Scotland on what ‘makes them proudest to be Scottish’. This will in turn become the next iteration of pushing their Social Media (with a ready made fantastic visual)

The push for authenticity comes from enabling people to push the positive messages about Scotland knowing that Scotland is a country almost designed for Instagram. Each of those pictures is a real and personal view of Scotland and with your typical filter, looks great.

Be authentic and unique and let people do the work for you

Engagement

Going back to the Travel Agency, Visit Scotland are following a trend in sales and marketing which is to create ‘experience centres’ where the Digital presence is used to drive physical stores. Amazon, Apple etc are already all over this but it shows that it’s applicable everywhere.

There are lots of examples (usually in airports) to push VR or visuals to market tourism but this jump into the sales/service aspect is really fascinating for tourism. Our Celtic cousins in Ireland produced my all-time favourite marketing campaign

Ireland in VR

With the near absolute market penetration of Irish bars globally, they already have experience centres everywhere in the world. It’s perhaps no surprise Scottish tourism numbers lag way behind Ireland’s (around 3m trips vs 9m trips per year – even with UK visitor numbers skewing that a bit). You can have a Guinness in a bar in Manila and it you can pretend you are in Dublin, which gets you thinking…..

The opportunity afforded by social media to build brand awareness and engagement is considerable and the mix of the sales, marketing and service channels will increasingly be smart business for tourism. Scotland can’t overnight build a pub in every city but VR, Instagram etc is a very cost effective way of doing something similar.

So, Scotland can be commended for its approach to customer engagement – numbers this year are up 28% on last year overall and 49% from North America alone which even accounting for the Outlander effect and the £ sterling Brexit Armageddon is pretty good.

www.thecorporatefuturist.com

Scotland ‘The Most Beautiful Country in the World TM’ – To see why, have a look at the #scotspirit on Instagram or Twitter.

https://www.theguardian.com/uk-news/2017/nov/01/scotland-feels-the-strain-as-tourism-causes-disruption-across-the-highlands

I would stress that I have no connection with VisitScotland other than as proud Scottish person (who does agree that it’s the most beautiful country in the world…. maybe joint with New Zealand, or Canada, possibly France….

Recruitment in 2017: The Digital Diversity Dilemma

Digital is disrupting everything and this includes the recruitment process. Some corporates are going so far as to remove the academic requirements as entry criteria to rely more thoroughly on their own tools to assess talent. What are the unintended consequences though? And how do we find the value amidst the noise?

 

 

http://www.ey.com/uk/en/newsroom/news-releases/15-08-03—ey-transforms-its-recruitment-selection-process-for-graduates-undergraduates-and-school-leavers

Back in 2003 when I was applying for one particular graduate role, I had a conversation with the HR lead about psychometric tests where I gave my opinion; 1) that you could learn them and most companies used a small range of suppliers (after a few, my marks were awesome, mostly because I’d seen them before) and 2) they are ignoring a range of skills and abilities that you can’t test with a online paper with some people who fail, who might be great.

Her response at the time was something I hadn’t thought of namely; we get enough applicants so that we could take a random 10%, interview them and get enough quality people for the job. The psychometric tests were there to apply some marginal value to whittling down to a manageable number. Having made it though to the last round myself following 4 tests, 3 interviews and a 3 day assessment centre, I discovered they had a quota of 8 people from the 10 that had made it that far.  This was of scant consolation given my finishing position of 9th.

In the subsequent years, the process I don’t believe has become more personal. There are interviews conducted online using webcams, various assessment centres, interviews and a range of new tests. Digital has enabled much more to be done in the process with less human intervention. From engaging quite closely with the graduate process in particular for a consulting firm, I arrived at the end of the process for the assessment centres and the interviews. Over the years, I’ve not noticed any obvious change in the type of candidate.

Except one.

I think there has been a decrease in graduate candidates from  poorer backgrounds and I have seen a definite trend towards private schooled and very polished graduates. This is no disrespect to some of the excellent grads I’ve worked with but I wonder whether we’d profit from looking at a better social mix.  Now, I don’t want to speak to wider socio-economic trends or education  but as regards just the process itself.

Here are some things to think about;

1)     The digital process – Digital allows for a range of new tests, tools and processes to be delivered/off shored and analysed to bring some analytics to the overall process. This now includes recorded webcam interviews, Skype interviews etc.  The polish which looks good in that process is actually taught in private schools. These kids arrive at University already better prepared for the type of interview process which is increasingly prevalent. I am guilty myself of being impressed by graduates who deliver a nice presentation but even before the grads get to the interview stage, many have been removed from the process. In the early 2000’s there was a trend towards removing dates of birth and photos on CVs to make for a supposedly fairer judgement. The new process essentially doubles down on the original problem by bringing how people look right to the start.

 2)     Academic scores – can actually be a leveller. Your exams are the same for everyone so there is some balance in the scoring. It’s easy to say that exams are not the only thing and that all the extra work is important but the hierarchy of needs for less well-off students is that they spend 25 hrs a week working at a shop and then the rest on their studies.  Is this recognised in the same way as 5 hours of charity work a week would be? For students working every summer full time to save a bit of money vs 3 months on a volunteer charity program in Africa; is there a fair assessment of value? If you remove the scores as a main driver of selection, do you actually make it less fair for some?

 3)     EQ vs IQ –  I’ve written before about the rise of EQ as a core skill vs IQ as the main marker of value. The combination of this plus Digital is why I think companies are looking to remove academics as the gatekeeper of selection. You could essential allow every university student in the country to apply for 1 job if you have enough intelligence and analysis going into the process. A big AI engine could run through the applications and pick out the best people. However, your fit with the culture, your opinions and way of presenting them, and your approach to innovation and creativity are increasingly important. How ready are the tools and the AI to be able to apply those criteria? And even more so, if we are explicitly looking for more diversity of thought. How can that be built into the tool?

 All in all, recruitment faces the same challenges as with anything in Digital Transformation which is to make sure that Digital supports and enables in the first instance and as the technology progresses, you give away more of the qualitative measuring to the AI.

As soon as you measure something, people will find a way to try and game the system. Private schools know that employers like charity work so the pupils are obliged as part of their lives to do charity work (and are assisted in the process). Google constantly change their algorithms not necessary to make them better but because people work out how to get their positioning higher.

The highest position in the search always goes to the people paying the most, the richest not necessarily the best. We need to make sure that’s not the future for recruitment.

www.thecorporatefuturist.com

PS as a bonus,  if you consider recruitment as a CRM process here’s where it might be going.

No touch recruitment –  AI searches online information Social Media, LinkedIn etc and just selects the candidates without anything process at all. You get an IM on LinkedIn offering you a job on a 3 month probation – it doesn’t work out, no harm no foul.

The High School Draft  – ignore university all together, pick candidates out of high school NBA style, sponsor training for them as university modules across a range of universities and training centres. Get the best candidates before anyone else.

Leadership in 2017: The end of corporate leadership and the Machiavelli matrix.

The changing dynamics of how and where we work, are changing what people need in a leader.  Leaders used to inspire, inform and create an atmosphere. Do they do so now, and do you even need them to?

At some point as you go through your career, you have to make a decision about what type of a worker and what type of a leader you are going to be. The learning process is to understand more about people and different cultures, and to work out how you get the best out of those people. There are a million books and random motivational messages to support you in the process but that is all nonsense unless you can apply what they say.

As Machiavelli said you can choose to be ‘loved’, collaborative and engaging or ‘feared’ directive and imposing. Everyone ends up on that spectrum but if you are at the extreme, you won’t be effective or happy. I.e. everyone takes advantage of you or everyone hates you. (see any leadership textbook anywhere for 500 pages on variants of this).

This has not generally changed but the context around it has. To summarise the change; consider a view of distance to people. Not just emotional but physical. You can be close to your team sat in the trenches under fire from the enemy (insane client requests and visiting leadership) or you can be sat behind the lines sending instructions from headquarters.

Machiavelli matrix

Line yourself up against the model being honest about who you are and what you enjoy the most.

Me, I love being in trenches close to the people and applying the iron fist in the velvet glove approach. It’s all smiles and laughs until a line is breached and then it is fire and brimstone (not for long, then it’s back to the laughs). I’ve trained myself over the years to adapt my approach and my mindset to be good at doing that and I’m pretty happy with where I am.

Big, massive however…….

If you look at where things are going at corporates. The fundamental dynamics of people working together are changing which means that the role of leaders I think is changing too.

Change from experience to efficiency – most if not all corporates are moving towards some type of activity based working with the addition of collaborative spaces. In addition, there are multitude of articles and surveys showing the changing preference towards working from home.

The foundation for all of this is built around people becoming more efficient, better use of space, and more effective allocation of resource.  To me, this goes against a core principle that I have worked to, namely you want to enjoy yourself at work. It’s not a question of the time spent but a value judgement about what you can create in the team. I’ve got more value in the osmosis from being next to people than I ever would have getting my work done an hour earlier and going home. The 30 minute coffee discussions, the Wednesday afternoon cake competitions, the side conversations have all contributed to knowing people better,

I grew up in consulting where you would often work away from home; breakfast in the hotel, you would leave as a group in taxis to go to the office, you would leave as group and commonly all go for dinner. It was a 14 hr a day engagement with the same group of people. I probably worked for 7 of those hours but I learned more in the other 7.

The role of a leader in that context was to create an atmosphere over the whole day where everyone could contribute to more than just the work. Think about graduates in particular, if you only see them in the course of their work during the day, you miss the opportunity to see their richness of knowledge and way of thinking in other ways. I know more about the people I worked with 10 years ago than I do about the ones I did last year.

Ask yourself now in the workplace in 2017 why so many people have large noise cancelling headphones? How much time do your leaders spend engaging you outside of core working? This is a skill and an environment which is disappearing. I can completely understand the opposing argument but we haven’t replaced that old fashioned approach which an equivalent and so the skills are becoming redundant.

Information and insight – it is the same for the tools and methods which enable collaborative working. The potential is huge to improve engagement and alignment in co-production of documents or in the sharing of information.  However, the increase in volume in information does not always equate to equivalent quality and value. Look even at Linkedin and consider how much original content you see produced vs content shared. I know a huge range of people who I’ve never seen write a single thing themselves. Spend a week reading and liking only an article that was written by the poster and see how you behaviour changes.

Sharing a link to the Harvard Business Review with no comment or insight is not entirely valuable. Should I get any credit for knowing something because I’ve shared it. This is translated into corporates too. Leaders now with access to a huge range of material don’t have to produce anything or promote their own thought leadership. Even more than this, because everyone has access to all of the information, younger people no longer are turning to leaders to see what they think in the same way.

Consider, when was the last time you were asked by a junior person what you thought about something or when was the last time you shared something that you did yourself to a colleague?

Inspiration –   a role of a leader was always to inspire the people that worked for them. It was a ethos that anyone would be happy with what they were doing if they felt inspired by the leadership. There’s a great but possibly apocryphal story of someone asking a janitor in 1967 what their job was with the response being ‘I’m putting a man on the moon’. The role to inspire was essential to building that connection with the organisation.

Now with twitter and LinkedIn etc . you can connect with very important global leaders and experts. You can listen to Richard Branson’s thought of the day or assess Justin Trudeau’s utterings on foreign trade. A bit closer to home, you can see the CEO of your own companies account, what she thinks, is reading or is listening to. Younger people in particular therefore, don’t need the inspiration as much from the lower tiers of management because they think they’ve got what they need elsewhere. I don’t need to know what Keith Logan thinks about AI because I can read what Mark Zuckerberg thinks all, of, the, time.

Ask the junior people in your organisation who their business role model is. 10 years ago who would have been given a name in your organisation. Now, it’s likely to be a global CEO or a superstar TEDx er.

So then, the fundamentals for how we work have changed and we are perhaps becoming a industry of managers. So, have a think about your own organisation and look at your leaders. What is being valued and rewarded higher up and even more importantly, think about what’s important to you in a leader and think about the leader you want to be?

 

http://www.thecorporatefuturist.com

Customer experience; the Japanese way: Hyper-specialisation and what Kanazawa’s tiny, tiny whisky bar might mean for the future.

The Japanese know you have to be authentic, you have to have knowledge if you want to look like you care and you have to respect the crowd.

People naturally want to be a little different, they want to feel special or be special. As the world is getting more connected it’s actually becoming more homogenous. Teenagers internationally are all taking selfies, using social media and shopping at Zara. Whether you are in Beijing or Brisbane, you are going to be doing a lot of the same thing.

At the same time, you might all be using Facebook in the same way but you can link with people with really specific interests and ideas. The old fashioned equivalent is the difference between a city like London and a city like Brisbane. In London, you can find from amongst the 9 million people, a Star Wars absinthe bar with enough people who like Star Wars and absinthe, to be able to fill it. In Brisbane, you are more likely to see a range of different people in the casino or in the RSL; every taste in blended into something which is more generic and more middle of the road.

As regards products, services and experiences for customers; the progression is towards wanting the Star Wars Absinthe bar experience even though you live in Brisbane.  How do you build your service and product catalogue to meet that demand?

To do that, we can look to the land of the rising sun for advice.

I was recently in Japan on holiday (and it’s great) and we visited a town on the west coast called Kanazawa. (Until recently a 4hr trip from Toyko before the launch of the new bullet train service.) The town was busy because of their huge annual Oktoberfest celebrations (you haven’t lived until you’ve seen organised Japanese conga lines to oompa music). In this town was a bar called Machrihanish https://tabelog.com/en/ishikawa/A1701/A170101/17000104/ . It is named after a very small town in Scotland with a lovely golf course but it is obscure for Scotland never mind a town in Japan.

Anyone who has been to Japan will notice the incredible range of small bars and restaurants with really specific themes, you’ll see tiny shops selling unusual things. Even if you haven’t been to Japan you’ll have seen their levels of super-fandom and you will also have seen how most crazes- Pokemon, cosplay, tamaguchi etc tend to start over there. It’s a remarkable place to look at customer experience.

But why……how do they approach things in Japan?

You have to be small and specific – with so many people in Japan, you have to differentiate yourself to stand out. People are actively looking for things which are unusual and special. People look for experiences which are away from the mass market whilst at the same time everyone buys commoditised products like iPhones etc. Japan has an amazing dichotomy whereby for some things, everybody is the same and for others, hugely different. The owner of the Machrihanish hadn’t named his bar the Scottish Bar or even the Edinburgh tavern. He went to the depths of something unusual and specific to create an experience.

The logic is, you have to go the whole way to create authenticity and therefore engage people in your product.

Consulting bit

The capability exists for us to use digital to enable the build of these specific products, services and experiences but to what extent do we do so. We also have the capability to understand what are the small and specific things that will interest our customers. As an example in an Australian context; why not produce an insurance product very specific to surfers – bundle up life, car, travel insurance into one experience product which pays out double for surfing related claims.  You have to support the product by showing authenticity by knowing what a surfer really needs from an insurance product. (see design thinking, empathy interviews, CX design). However, specific insights if they are applied generically aren’t that helpful. E.g. the product and the service need to be specific enough to take advantage. I can tell you right now that customers like transparency, simplicity, speed, personalisation and accuracy but that’s not enough for a customer experience strategy.

Knowledge and attention to detail – If you are going for small and specific you really have to look like you understand or you lose the authenticity and the credibility.  My bar in Kanazawa had real menus in it from the clubhouse at St Andrews, it had pictures of golf clubs in Scotland which were put in alphabetical order on the wall. I ordered a whisky and tried to explain it was from the most southern distillery in Scotland. The owner then explained in some detail how there were five further south and I had missed the Mull of Kintyre (a common mistake he said). He then explained how he was a member of St Andrews golf club (showed me his membership card) and described the relative difference between the types of seaweed on the west coast (no joke).

Consulting bit

If you look like you care about something, you have to understand it as it takes a differentiating factor into one of advantage. For the insurance company selling the surfing product, if it looks like a gimmick it will be treated as such. If you hired even one surf expert, he/she could manage the whole case load regardless of where the people are located. If it’s popular and you need more, then great.

The impact is on how you design your service (operating model to handle the traffic). The design in the fabric of your CRM is how to create better routing to your operations. A first line AI engine (with the surfing add-on dude?), 2nd line service to Brad from Bondi or even a sales discussion via Skype at the beach (surfing tinder). It’s an old tactic powered by new technology.

Crowd power – recognise the power of changing demand and waves of interest. The power of social media can generate hype in an incredibly short space of time with the capability in the background to build things quickly (consider the immediate and overwhelming supply of fidget spinners). When I was in Tokyo, I saw a huge line for a tiny food stall and then about an hour later I saw another one. The reason; both were selling Maine Lobster rolls which was the ‘big thing’. My guess would be that it’s no longer the case and everyone is eating ‘Haggis balls’ or something. The capacity for people to wait for something ‘hip’, the speed of change and the scale of demand was remarkable. Just as soon as it came though, it would be gone so if you were a lobster roll only specialist you would be stuffed. (pun intended)

Consulting bit

Any time lag in meeting the demand or any inflexibility in being able to scale would have represented a huge loss in potential revenue. The local McDonaldsshu wasn’t selling lobster rolls because it couldn’t get there quickly enough. They were nonetheless doing some good trade in their usual fare. What you need then is the ability to have that two-speed business where you can maintain your core but you give yourself the capacity to change to meet specific needs which might come quickly from nowhere.

Where I’ve seen Japan mentioned, it’s not usually in the terms of it being a leader in customer experience it’s usually about efficiency, manufacturing, knowledge, accuracy, product design and creation. However, it’s possibly because they think about the latter ones so that they can deliver the former.

Arigato gozaimasu

See more blogs from Keith Logan san @ www.thecorporatefuturist.com

History for the future: Bitcoin and the 1781 Bank of North America Act of Congress – Bitcoin might be special but it’s nothing new

There is no argument that bitcoin has the potential to be revolutionary and is already starting to be. However, to predict what might happen in the future, we can look to the past.

In a nutshell; in the 18th century different banks and currencies were everywhere and popped up to launch frequently (most failed), the need for banking was pushed by the industrial revolution to fund investment and growth, a lot of the origins and the development were in China, there were several crashes and ultimately, governments saw the potential for profit and the need for regulation and took overall control. If you swap the 21st century for 18th the century and Information revolution for industrial, does it make you think of anything?

History (you can skip this bit if you are well read or easily bored)

The origin of banking and money is a fascinating one and well worth a read. (See below) here is a very rough history for you. The origin of paper money comes from China in AD 700ish where they also came up with the word cash. It didn’t take off in Europe until much later where promissory notes started to replace hard currency in the 18th century, this happened at the same time as the creation of stock markets, a number of bubbles (Tulips, South Sea) and a change in the way governments funded war (i.e. the British needed a way to get money to fight the French).

In the US, the desire to have separate currency was a cause behind the wars of revolution and the post war years led to the creation of a large number of banks at state and federal level, several of which were fraudulent or corrupt with people swept away with the potential for profit. Alexander Hamilton (of the Musical fame) even ended up losing a duel to the vice-president of the US (Aaron Burr) built on a hatred gained from the creation of Banks. The 1781 Bank of North America lasted 6 years before corruption destroyed it and after another wait, there was a second and more successful federal attempt.

In this manner, creating for ourselves our own paper money, we control its purchasing power, and we have no interest to pay to no one.” Benjamin Franklin

The Chinese created paper money as part of millennia long campaign of innovation and ideas growth, the British created a state monopoly (Bank of England) to ensure the money and control stayed with Britain and the Americans were hugely entrepreneurial, had a fight about it and ultimately settled on the government option (which importantly meant tax revnenue.) (see below for further reading)

 

What does this tell us about today?

Drivers for development and success – the development of central banks and paper money were driven by in particular, the industrial revolution which required a new method of finance to fund and support growth in technology. In a period of huge disruption and change in industry (which can be strongly argued is much larger in scale to the disruption of this age. i.e. think of the impact of a horse ride of day being reduced to an hour on a train.) The underlying drivers supported the development of the system and the fundamentals of finance changed towards debt and investment without which the progress would not have been as quick or as ‘sticky’. Britain at the time as the leaders in industry and war, become the leaders in finance too.

Skip to 2017 and look at the drivers in today’s market.

Global disintermediation – like the Americans in 18th Century who didn’t want to be beholden to the British to run their finance, the unstoppable force today is towards a reduction in intermediaries and the closer connection globally between any two points. The power of globalisation is both driven by and enabled through Blockchain and Bitcoin.

The fundamental disruption of the information age is doing what the industrial revolution did, providing huge change and therefore growth opportunity. One of the biggest constraints to global trade for small business is risk/confidence and efficiency in transfer costs (FX etc). If you remove that then there will be a huge change – what does Blockchain/Crypto do again??

There was no stopping central banking once they got going and there’s every evidence showing the same now for Crypto.

Boom and bust – any new wave in finance is usually met by some aspects of a bubble. Namely, there are some first movers who know enough to profit which builds as demand grows, the less informed public jump in pushing the price higher until it’s unsustainable and then collapses. If there is value in the product then there is a return to a more sensible long run price.

There is the example of the East India Company who in the 18th century tried to convince the government to convert government debt with the Bank England into shares in the East India Company. It came close to tying the British nation’s finances to a bubble. Consider the range of ‘Initial Coin Offerings’ today mirroring the myriad of new banks and ventures in the US and UK at the time.

Have a look at these graphs below, one is the classic view of a bubble, another the the price of bitcoin in the past 5 years, and finally the last 15 years of Amazon.

stages_bubble
bitcoin-historical-chart
amazon-stock.png

The question is, is the Bitcoin one like Amazon which went through a correction (couple of spikes and drops) and then run into a sustainable period of growth? Or is it going through the mania phase before a real drop?

It was only after a period of adjustment and a few false starts that the systemic, controlled and stable banking system came to pass. Which takes us to;

 Government regulation – there came a point where the government stepped it to take charge of the banking system. Partially as a response to the range of newly created banks; the risk of fraud, boom and bus, in order to protect its citizens. More importantly perhaps in order to take control and ultimately build in taxation to create revenue. Central banks use a range of levers to steer the economy which includes the management of money supply, debt, interest rates etc. At the point that Crypto reaches (or threatens to reach) a scale that it can influence economies, there will most certainly be a desire to bring it under the wider banner of the government. However, because it is decentralised like the internet, there will be a need to have a international joined up approach.

However, power talks so whoever takes the initial control in regulation will take the lead in better leading its adoption. It may be most prominent in Japan but it’s the Chinese interesting pushing the Americans into regulation. This was not the case with the Internet.

https://news.bitcoin.com/chinese-officials-travel-to-us-to-discuss-fintech-and-cryptocurrency-regulations/

For all you Brexit fans out there, this is type of thing that Britain used to lead a couple of centuries ago. It is demonstrably not the case now. For all the America First Trump fans; it’s time to start getting a bit worried that it’s China leading the way.

So then…

All in all, if you are betting on an outcome. You can put your house on Crypto being a huge part of international finance and business in the future. If you want to consider what might happen as part of that trans, it’s worth turning to history.

“Let me issue and control a nation’s money and I care not who writes the laws.” Mayer Amschel Rothschild, 1790

www.thecorporatefuturist.com

Further reading

The 20 second option – https://en.wikipedia.org/wiki/History_of_banking

The great fiction but still informative option – https://www.bookdepository.com/Conspiracy-of-Paper-David-Liss/9780804119122?ref=grid-view&qid=1508195359685&sr=1-1, History of paper money and the stock market (with some sex and violence) https://www.bookdepository.com/Whiskey-Rebels-David-Liss/9780812974539 History of US banking (with some sex and violence) – both books are brilliant, ask me about my money back guarantee

Crypto trading – have a chat to my good friend at VANAM http://www.twitter.com/J_van_Amerongen

Background to blockchain – https://blockgeeks.com/guides/what-is-blockchain-technology/

The Icelandic Football team’s guide to Digital Transformation

Yesterday, the Iceland football team qualified for the World Cup in Russia ahead of Croatia, Turkey and the Ukraine and in doing so became the smallest ever country to achieve that feat. Iceland has 330,000 people, almost non-existent football league, a very small number of recognisable players, weather that could be considered ‘not ideal’ and an economic legacy of near Armageddon. They have continued on from the European championships where they not only qualified but managed to beat England 2-1 (TV rights for English football $18b AUD). 10 years previously they were ranked 120th in the world and their best ever result was a 1-1 draw with Turkey.

In summary; they have very little money, huge restrictions in their talent pool, conditions which don’t provide a natural advantage for success, no legacy of success and they exist in an area of huge competition. They have nonetheless, achieved a transformation so remarkable as to be quite unbelievable. If the situation sounds similar to many corporates, that’s because it is.

https://www.theguardian.com/football/2016/jun/08/iceland-stunning-rise-euro-2016-gylfi-sigurdsson-lars-lagerback

So what would the Icelanders recommend

1) Have a plan and stick to it – on the field Iceland have a style of play which is entirely based around what their players can do, they play on the counter attack and don’t try to take on the bigger teams at their own game. They are rigorous in training, coaching and managing players to fit to that system. In a recent game against Turkey (a 3-0 win), they had the ball for only 25% of the time but still managed to score three goals. Their game plan is based around every single player knowing the job they have been given to do and executing it well.

Off the field it is the same, they designed the transformation of the game which required players, coaches, the leadership and even the fans to buy into an approach and a design and every decision was taken to support that. For example, they had a long term coach who built a succession plan to the current coach which started 5 years ago. They resisted the temptation to change the structure or the resources after a few bad results. Their 10 year plan was to create a new system to support the the game overall, invest at all levels, pick the style and the approach for playing and build everything around that.

How often do we change around structure to fit to a new direction and how often does your company build a strategy or transformation plan?

2) Change needs to be everywhere – the problem was not viewed as simply as the Icelandic national football team being bad. The approach was not to spend lots of money on the team itself rather, to see the challenge as football in Iceland as a whole. Much of the investment has been on coaching young children, providing facilities and a system to support everyone. Women’s football, youth teams, children’s teams are not treated as anything different.

For example, young children in the system are able to go and train with a professional club and anyone is allowed to apply to be a coach. Accordingly, Iceland has the highest number of coaches per capita of anywhere. The investment and the engagement is spread across the whole organisation.

How often do we in organisations think about how to transform the whole business? The view is that scale of the challenge is so big that it needs to split into boxes, new teams are created or devolved from other parts. The strategy process and the planning sits with the higher levels and the steps to get there are communicated down rather than built up. The England Manager is on a salary of $5m AUD, but that’s not where they should necessarily be putting the money.

3) Change the dynamic of your constraints – one of the biggest challenges for Iceland is that the winter is cold and extremely dark and at other times, they have huge amounts of rain and low average temperatures. Manly Beach in the Spring it is not, and their beach volleyball team is extremely ropey. As a Scotsman, I can appreciate the astonishing natural advantage Australia has for playing sports outside but you have to imagine Sydney with the weather of Glasgow. It would be a different place and would need a different response.

Iceland though have changed the dynamic completely. The have built a series of huge, heated indoor halls with full football pitches rather than small practice ones. They have made access to these easy, cheap and have put investment into ensuring the experience of going to these halls is as good as it can be. There is actually an incentive to go to training when the weather is bad.

To add to this, they have taken a very small player base relative to other countries so they’ve applied a real ‘hothousing’ approach to manage and nurture talent. They have a learning pathway for development built off the range of coaches and the successful ones are managed into programs overseas. One of their players recently sold for $70m AUD (Glyfi Sigurdson).

The lesson here for corporates is to not to try and be something that you aren’t. I’ve had this conversation with a number of corporates; ‘we need to be customer centric’, our ‘customer experience needs to be best in class’, ‘we have to be agile’, ‘we have to get best use from our data’.

The trouble is, everyone says the same thing and everyone is trying to do the same thing. It therefore becomes a factor of investment or commitment. What would be the Iceland Football team answer?

http://www.thecorporatefuturist.com

Digital Transformation: how to know you’re successful? (here’s a tip, if you use the words Digital and/or transformation, you probably aren’t)

Digital Transformation falls into the most desirable category for consultants, namely; something for which there is no agreed definition, something for which there is a huge appetite for investment and something for which there is no clear definition of success. In consulting, we love waves of programs or even better ‘ages’ – information age etc. because it creates a case for change for every organisation which leads to large programs, investment and therefore revenue.

As a corporate though, this is what you want to ask yourself.

Do the best companies at Digital call it digital? The answer is a pretty big no. If ‘Digital’ is endemic in your business and it’s how you operate it’s not a choice, a channel or even a principle to align to. It is the core operating logic for how you do business. The real change in the market has been the reduction in barriers to entry which mean you can engage with customers, manage your people and manage your ecosystem (the huge investment IT costs to do this no longer being the same issue).  People love to point out that of the top 50 US companies of 10 years ago, there are very few that are the same today but what this highlights is that it has been much harder to manoeuvre something traditional into something ‘digital’ than it is now to change something digital into some more traditional. Amazon and Whole foods, Facebook becoming a media company, Apple becoming a bank. Perhaps we shouldn’t call it transformation and start calling it resurrection. Maybe you need to fundamentally change the Digital DNA of a organisation first before you try to transform anything. A lot of banks have their online only, people centric brands which they create and then try to roll the best ideas there into their big brand. Why not try it the other way and allow the big brand to die slowly as they blend into a completely new organisation?

Is it transformation when you do it all the time? I have spent a career designing and planning transformation, it is on my CV, my title and I’m proud of the time and investment I’ve put in to trying to ‘transform’ organisations. However, the frequency with which I’ve run strategy sessions, built operating models and customer journeys shows that there is an obsession with perpetual transformation. One program connects with another program which overlaps with the new one which is the second part of another one. Most are named something of the genre ‘Phoenix, Genesis, Apollo, Jigsaw or anything with First in the title; CustomerFirst, PeopleFirst, America First etc. etc. There is a trend at the moment to not call programs ‘transformation’ because people have become bored, blasé or generally tired of the term. If this is the case then either they haven’t been transformative or they haven’t been successful. By the very definition, people need to know they are in a very different world because of something that has happened and they can pinpoint the changes. Again, the companies who are best at transformation don’t call it transformation. It’s not because they are bored of the title rather they see change as a constant and valuable force. Although I am loathe to use the word agile, the core of being flexible, agile and adaptable is built into how they operate. The rise of Chinese Tech firms is a quite remarkable case study but before anything, it’s noticeable that you can’t define what type of company they are; tech, media, transport, financial services, communications etc. These would not be successful without a constant and embedded capacity for change.

What happens when Digital is Business as Usual? – it’s likely that we’ll look back and consider even the term ‘Digital’ to be old fashioned. We are already at the point where it’s not an option, it’s the way we do business. ‘Digital’ penetration might be varied by industry and by country but it’s a question of when rather than if the entire world sees Digital as the standard. Even more so, it’s increasingly the Digital part driving the non-digital part. Your shops are there to market your products with the sales and service online. Your call centre is to support your online presence and so on… As it stands, there are lots of cases of the online service being much better than the traditional channels; (don’t believe me, next time you want to complain about a phone company or an airline, make sure you put it on Twitter the same time as you start a phone call and see what happens.) As this changes, organisations will need the scalability to handle the majority of their cases Digitally rather than looking great managing a small number which is easy. You can already see the lag on ‘click to chat’ growing but you can also see the huge investment going into AI Chatbots.

So then, have a think about your own companies approach to Digital Transformation. What they call it can tell you almost everything you need to know.

As for the next buzzword after Digital Transformation I am putting my money on a return to the old days of consulting; a block of How consultants Design People, Design Services, supported by a raft of What consultants – SMEs in industries, capabilities, tools. What I don’t think we’ll have is anything called Technology or Digital or Customer because that will be so obviously core skills that we wouldn’t need to mention it. My previous job title Keith Logan; Head of Digital Customer Experience Transformation.

http://www.thecorporatefuturist.com