Flip (27 page)

When I said I could see why this was a problem, citing customer reaction as my primary concern, the manager looked at me blankly. 'I had not thought of that.'

'What are you worried about then?'

'Customer perception is not my area, I was simply worried that mistakes would be made.'

Fair enough I thought, and asked, 'So what did you do?'

'I banned iPods.'

I asked him how that went. Badly was the answer. The young trainees started to put their iPods in their pockets and run the headphones under their uniforms, up and out of their collars and into their noise-protection ear muffs, leaving only a small indication of the recognisable white iPod headphones.

'What did you do next?' I asked, grinning.

He employed an independent consultant to come in and do random accuracy checks on the trainees. This is not an uncommon activity, as the airline does things like this to benchmark its safety performance anyway, and has been doing so for a long time.What he found was that there was no correlation between listening to the iPods, albeit hidden, and inaccuracy.

'What happened next?' I asked.

'They bought me an iPod for Christmas.'

I laughed. Just because he couldn't work effectively while listening to music, it doesn't mean someone else couldn't. In life we perceive the world through the lens of our own experience. Then anything that does not match our personal experience we think is wrong, and then attempt to bring that person or thing back into alignment. The problem with this is that we usually attempt to do it by 'controlling' it and using our positional authority. Are you married or in a relationship? If so, let me ask you, have you ever tried to change your partner by controlling them? How did that go for you?

I thought so.

This experience reminded me of the financial adviser I met in Brisbane who was struggling with some of his staff, again younger staff, who refused to wear ties. He asked that they do, but they simply ignored him. Over time it got worse, to the point where some stopped wearing suits altogether.When one of his team came to work in jeans and thongs, he completely lost it.

He conducted a survey of his key customers about staff dress and the impact it had on their experience. He had expected to see a compelling response demanding that the staff wore more formal attire. He found the opposite to be true.

Almost 75 per cent of the respondents had not even noticed the more casual attire of these advisers and para- planners. A further 20 per cent actually said they preferred it because they felt more relaxed, and only 5 per cent said they preferred more formal attire. He has since changed his 'rules'.

These examples are superficial, but are evidence of a much deeper problem in workplaces around the world: a failure on the part of managers to give space and resources and, most importantly, trust to their staff to do their job. They micromanage everything, from whether they wear a tie, to what time they arrive, down to what they say in their emails. This is all leading to frustration for the staff, and lost productivity and profitability as a result.

According to Gallup, there are twelve questions – each of which relates to a specific need – that indicate whether someone is fully engaged. Of the twelve, the first two relate directly to the idea of letting go of control:

• Do you have the materials and equipment you need to do your work right?
  
• At work, do you have the opportunity to do what you do best every day?
  

Akio Morita, the founder and former chairman of Sony, has this to say about listening to staff: 'A company will get nowhere if all the thinking is left to management. Everybody in the company must contribute and for the lower level employees their contribution must be more than just manual labour.We insist that all our employees contribute their minds.'

START HERE

The old mantra of a job for life and the 'loyalty' companies want so desperately from their employees also bespeak trying to keep control. Now don't get me wrong, retention is extremely important. Crunching some numbers recently with a law firm client of mine, the net return per person more than triples between the second year and the third year for professional legal staff.

However, expecting them to stay for very long periods these days is probably unrealistic. Some will, but most will not. This is why Ernst & Young have adopted a 'start here' approach to their graduate recruitment. Instead of sweating bullets trying to keep the best and brightest from leaving, the company wishes them well and gives them every support in moving out to move up. They have built their graduate-based employment brand on the tag line 'start here'. They do this for a few reasons. One is they might come back, assuming of course they had a pleasant exit experience. Secondly, they may move into non–accounting firm employment and later become a client. But most of all because they believe that if they want to leave, let them. There is no point having someone unhappy at work.

Rather than try to keep the employees, the company strives to keep a relationship with them as they move to other companies and advance in their careers. When the best and brightest of these young workers have become senior executives and CEOs, they'll remember Ernst & Young as the great place where they got their start and they'll be inclined to send their consulting work to their old friends rather than to one of Ernst & Young's competitors.

More to the essence of 'To Get Control, Give It Up' is the example of a 'tailored taste' being implemented by the Australian Defence Force. In research I helped conduct for the ADF we found that the younger generation shied away from the forces not just because of the work, the risk of war, or even some ideological opposition, but because they would be 'locked in' for a set period of time. They were not at all keen on being controlled in this way. One of the recommendations made to combat this was the gap-year program. A 'gap year' is becoming a sort of rite of passage for young Australians after they finish high school. They head to the UK, the States or somewhere else in the world for twelve months as a gap between high school and university. Some, however, don't have the cash to head overseas, and would love to take a year off but want to grow and learn at the same time. Enter the ADF gap year.

Defence believe they have a superb product. They believe that if people at least try it they will enjoy their time in Defence and join longer term. Defence are putting in place a two-year program as a gap-year option. It's 'try before you buy'. That is, students finishing year twelve can enrol in one of the forces for two years only, get trained, develop some leadership skills, stay fit and travel overseas on at least one operation while there. They can then leave and pursue their other interests, and at worst the army or navy or air force had a committed soldier for a couple of years. Or in the best case they could leave and spread the word on how awesome their time was in the forces. Some of these gappers will love the experience so much that they will enrol for full service, attend ADFA or Duntroon or something similar, and become fully fledged members of the ADF. This is at least the theory.Markets call this a tailored taste.

The way I look at it, particularly the Ernst & Young 'start here' positioning, is that if your staff know you have no illusions about them staying for life, they will converse with you actively about their plans because they don't feel threatened. This helps you better prepare, better retain knowledge and better orient their replacement.

Empowering your staff works when you have hired good staff. Once you have them, you really need to use them. Get out of their way and let smart people do what smart people do.

Five Things To Do Now

1. Ask yourself if your current business model is under threat, or if it could be if technology continues to develop rapidly. Start now: consider how you would exploit such forced change so you are not on the defensive when it happens.

2. Come up with ten ways you could tap into a broader population to stimulate ideas for you and your business.

3. Start a structured program within your company that brings your best and brightest people together regularly to work on new ideas or existing problems. Give it a cool name and start using it to attract and retain talented people.

4. Come up with five ways you could collaborate with your existing competitors to bring a product to market, enhance an existing product or service or even crack open an entirely new market.

5. Does your business have IP that is very valuable to the market place that you are not benefiting from because it is hidden or over-protected? How could you better exploit this asset? In other words, how could you win through losing control?

As I was struggling to gain traction with this book, a mentor asked me, 'Pete, how's
Flip
coming along?'

'Great,' I replied.

'How many words have you written?'

'None. I am still doing research.'

'How long has it been since you started talking about this book, two years? More, I think. Isn't one of the chapters about how action precedes strategy, or something like that?'

'What's your point?' I said.

'Nothing really . . .?'

It is always more than a little aggravating when someone gives you your own advice. We teach what we need to know the most, the saying goes. I have taken two years to get to this point. Thorough and well researched perhaps, slow and delayed,
yes!
I have employed a full-time researcher, and engaged dozens more around the world through freelancing sites such as elance.com. I even sponsored a PhD project on related themes. Despite all of this work, until now I had nothing to show for it.

Perhaps this sounds like the logical way to approach writing a book or accomplishing any major task. Given that this is my fifth book, I would like to suggest that it is not. It is in fact the opposite. Your best work does not happen when you are planning. Your best work happens when you are in the flow. On a plane, in a coffee shop or locked in your office late at night. It happens when you are taking action. Sure you need planning time but at some point you have to stop thinking, stop planning, and just
do something
. Anything!

Counter-intuitively, the clarity I was so desperately trying to find before I started writing only came
after
I started writing. The point is, of course, that only through taking action, and the more the better I say, will your strategy reveal itself (and rarely in one fell swoop) and the clarity you seek will be gained. Not only is the potential upside of this action orientation great, the downside of over-planning and overanalysing can be worse than merely being confused. In a market being squeezed by constantly rising expectations, less client and customer loyalty and a compression of time, distance and required effort, inaction means you will likely miss the opportunity you were planning to exploit.

What action are you procrastinating about, as you plan and plan and plan?

It is like the young couple (or singles nowadays) saving for their first house during a property price boom. The price of houses increases faster than their ability to put together a sizeable deposit to get a loan. They effectively 'save' themselves out of the market. The longer they 'save' the further they are from their goal. A
flip
, no less. It can be the same in business. When we delay our action we deny ourselves the intensely valuable feedback that comes from putting the product to the test in front of a real consumer (or employee), who spent real money and is using it in real-life situations. Life and business move and change so fast that we put ourselves at a competitive disadvantage the longer we procrastinate.

It is small wonder that David Vice, CEO of Northern Telecom, says, 'In the future, there will be two kinds of companies: the quick, and the dead.'

What about you? Have you ever had an idea that someone else made a squillion on? You know, you had it in the back of your mind, shared it with friends, even made some preliminary notes about it, only to mess around thinking about it for so long that one day you read a two-page profile in a magazine about someone half your age who did what you wanted to do and made millions doing it.

Or worse, have you ever knocked on its head an idea that someone in your team came up with, saying it 'was a good idea, but the market would never want it or be prepared to pay for it', only to see your competitor nail you to the wall with it the following year?

You get the drift, I am sure. If you want to develop a better business strategy, and a more compelling and achievable vision, then act first and plan later.
Action precedes clarity!
If you want a successful career, do the same. Stop trying to find the perfect answer, the perfect job or the perfect product or business idea.Move! Do something! Anything! The action you take will generate clarity. From the clarity you will gain clearer vision on what you want to achieve, and the feedback you will receive will let you rejig your strategy to focus on the activities that are actually working as opposed to what you think might work. I call this 'strategy on the go'.

STRATEGY ON THE GO!

Strategy on the go is not the same as having no strategy at all. Dispensing with strategy altogether would be outright foolish, and even though some pundits have declared the end of strategy, this is not what I think nor is it what I am suggesting. I am, however, suggesting that we need a newer, more modern approach to strategy, an approach built on the fundamentals of behavioural flexibility and rapid decision-making. It is time we let go of our obsession with detailed strategy, built on timeframes of five, ten or even twenty years. It is no longer possible to begin with point B in mind and reverse-engineer the result until you get back to point A with a detailed, stepby- step plan for achieving what you want.

Instead, you need to have broad vision, or what I call a trajectory, that compels you towards a better future. It should be flexible enough to absorb changes in market conditions and completely new technologies and products. The key is to only map out how you are going to get there in the broadest of strokes.

Imagine telling this to some of the Japanese companies. To think that some of them still speak of fifty-year plans! There is a good chance that many of us will be dead in fifty years. How on earth are we supposed to know what the marketplace will want in fifty years, or what technology will be available, let alone what it will mean for our industry or our companies? Don't get too excited right now, as you laugh off the fifty-year plans, knowing you have a rock-solid five-year strategy. Perhaps even your five-year strategy is a little absurd. First, it is not rock-solid. Second, in the current business climate a five-year plan could be just as dysfunctional as a fifty-year plan.

Meg Whitman of eBay could not have said it better when she observed, 'Forget about five-year plans, we're working on five-day plans here.' It's not that Whitman doesn't look five years into the future. She didn't pay $2.6 billion for Skype not to be thinking long term. But she and her colleagues are not following a detailed master plan; they're working out the plan as they go.

In an increasingly compressed and complex world with constantly shifting expectations, an obsession with planning and detail can be more of a hindrance than a help. It can wed your teams and business units to plans of action that are not working in the marketplace and that are not reflective of how your business has changed. It is no different in your career. Be flexible in your approach, prepared to unlearn and let go of what no longer supports your ability to move towards your vision, and learn new skills and behaviours quickly that will take you to your goal.

Rupert Murdoch is doing the same. He paid a huge sum for MySpace without a clear and proven business model for how he would generate revenue from the site. MySpace gives us insight into a multinational company and its CEO taking action without a fully developed strategy. Rupert Murdoch is a flipstar! Here is what he said about MySpace and similar News Corporation ventures:

The precise business model for sustained profitability from our digital investments is still uncertain at this point. Consequently, in some ways, we are embarking on a period of trial and error.
News Corporation Annual Report, December 2006

I have met Mr Murdoch, having worked with News Corp in the US and having had the pleasure of dining with him in Los Angeles. The man is a genius. He was a few days shy of his seventy-sixth birthday when we met and he was as sharp as any 26-year-old. He knew the MySpace purchase could be profitable, and the signs so far indicate that he is well on the way to being proven right, even if, as the quotation above shows, there are still some uncertainties.

News Corp's Fox Interactive Media division bought MySpace in July of 2005 for US$580 million. Barely more than a year later, in August 2006, Google and News Corp inked a deal under which Google will pay News Corp at least US$900 million, assuming web traffic targets are met, to be the search and advertising provider for MySpace and some other Fox Interactive Media websites. At the time the deal was announced, MySpace was adding 250,000 users a day, suggesting that the web traffic targets would have to be very high indeed to be out of reach. (In April 2007 they register
thirty-one billion
unique page views.)

Flash forward another seven months, to March of 2007, when News Corp and NBC Universal, the news and entertainment media division of General Electric, announced the creation of the largest internet video distribution network yet assembled. With initial distribution partners AOL, MSN, MySpace and Yahoo!, the as yet unnamed network will reach an unprecedented 96 per cent of the US internet audience. And I am sure internet portals in other countries will soon be added to the mix.At the time of the announcement, Cadbury Schweppes, Cisco Systems, Esurance, Intel and General Motors had signed on as charter advertisers.

There's a flipstar timeline for you. Spend roughly half a billion dollars with no definite idea of how to make it back, and eighteen months later monetise returns at roughly a billion dollars and counting.

The MySpace deals beautifully illustrate the overarching flip principle, 'Think AND, Not OR'. In the first place, the new video distribution network signals that exploiting intellectual property rights and giving the public free access to copyrighted materials on the internet are not mutually exclusive concepts. It displays the flexibility that distinguishes flipstar organisations from their competitors. Instead of relying on business as usual in the television and movie business, News Corp and NBC Universal are seizing the opportunity to make the internet a fully fledged, advertisersupported entertainment medium.

Second, note that in the August 2006 deal, Google and News Corp are partners, whereas the News Corp/NBC Universal video distribution network takes dead aim at Google's YouTube as a competitor. Likewise, outside the new internet video network, NBC Universal and News Corp's Fox television, movie and internet divisions are themselves competitors rather than partners. Change partners and dance with your rival. It's obviously complicated and will no doubt sow confusion along the way, but Google, NBC Universal and News Corp – three of the most successful companies on the planet – recognise that the way forward is to 'Think AND, Not OR', that 'Action Precedes Clarity', and that 'Confusion Management' is now an inevitable cost of doing business. You can resent these facts if you like, or you can learn to love them and join the flipstars.

Take Burger King for another example. Burger King led the corporate charge into MySpace – a messy, ambiguous and ultimately foreign situation – with action. They created a funny and personable profile, and the page took off. Burger King now has 134,000 'friends' (and probably a lot more by the time you read this), many of whom regularly post funny notes or even suggestions for burgers or promotions.

Fox themselves are plunging in to promote their own products. Their brilliantly conceived MySpace profile for
X-Men 3: The Last Stand
has attracted almost three million friends. It is impossible to quantify how much the MySpace profile for
XMen 3: The Last Stand
contributed to the movie's record-setting US$120 million opening four-day holiday weekend release (the Memorial Day weekend) in the United States, but it surely didn't hurt. The previous Memorial Day weekend record gross was
The Lost World: Jurassic Park
's US$90.2 million in 1997. And
X-Men 3
's Friday gross of US$45.5 million trailed only 2005's
Star Wars: Episode III
's record first day take of US$50 million.

MySpace is messy, but you need to learn to love the mess, to take some action without the clarity you desire. Others are choosing to sit on the sidelines and wait to see what, if anything, works.

Wired
asked Rupert Murdoch how News Corp was going to weather the cold dawn of a world in which traditional media is besieged by bottom-up, user-driven content: ' "We'll figure it out," he says, with a cheeky grin, scratching his head. "You want to learn from MySpace," he muses. "Can you democratize newspapers, for instance? What does it mean for how we do sports or politics? I don't know – no one does. I just know we'll figure it out".'
¹

This is what I am talking about. I love his new strategy, which strangely looks a little bit like: I am not sure whether this will work or how I am going to go about it, but let's have a crack anyway.We have some bright people, we will pay to retain the bright people who started MySpace, and we will find out.

Even with the US$900 million Google deal and the new internet video distribution network, it is still unclear whether News Corp's internet properties will pay off as they should. But Rupert Murdoch and his colleagues act anyway. They learn to manage the confusion and accept the risk.

There's no detailed master plan. What News Corp does have is a broad trajectory. They know the media business. They know that people, particularly the younger generations, are consuming media in new and different ways, and they know they want News Corp to be a major player in the new media channels. MySpace is a leader of the so-called 'new media' and Murdoch wants a piece of the action. Rather than try to reinvent the wheel and outspend some of the sites that have grown organically, he buys one of the most visited sites on earth. Then instead of doing what I reckon plenty of other media conglomerates would have done – namely, re-brand and integrate the website into its other media properties – he leaves it as is.

There's not a pixel of News Corp presence on MySpace. 'Obviously MySpace is a world unto itself,'
Wired
quotes News Corp COO Peter Chernin. 'There's never been a second when we said, "How do we put our stamp on it?"We'd be crazy to interfere.'