Is the Tipping Point Toast?

From Fast Company, by Clive Thompson

"Marketers spend a billion dollars a year targeting influentials. Duncan Watts says they're wasting their money.

Don't get Duncan Watts started on the Hush Puppies. "Oh, God," he groans when the subject comes up. "Not them." The Hush Puppies in question are the ones that kick off The Tipping Point, Malcolm Gladwell's best-seller about how trends work. As Gladwell tells it, the fuzzy footwear was a dying brand by late 1994--until a few New York hipsters brought it back from the brink. Other fashionistas followed suit, whereupon the cool kids copied them, the less-cool kids copied them, and so on, until, voilà! Within two years, sales of Hush Puppies had exploded by a stunning 5,000%, without a penny spent on advertising. All because, as Gladwell puts it, a tiny number of superinfluential types ("Twenty? Fifty? One hundred--at the most?") began wearing the shoes.

These tastemakers, Gladwell concluded, are the spark behind any successful trend. "What we are really saying," he writes, "is that in a given process or system, some people matter more than others." In modern marketing, this idea--that a tiny cadre of connected people triggers trends--is enormously seductive. It is the very premise of viral and word-of-mouth campaigns: Reach those rare, all-powerful folks, and you'll reach everyone else through them, basically for free.

Loosely, this is referred to as the Influentials theory, and while it has been a marketing touchstone for 50 years, it has recently reentered the mainstream imagination via thousands of marketing studies and a host of best-selling books. In addition to The Tipping Point, there was The Influentials, by marketing gurus Ed Keller and Jon Berry, as well as the gospel according to PR firms such as Burson-Marsteller, which claims "E-Fluentials" can "make or break a brand." According to MarketingVOX, an online marketing news journal, more than $1 billion is spent a year on word-of-mouth campaigns targeting Influentials, an amount growing at 36% a year, faster than any other part of marketing and advertising. That's on top of billions more in PR and ads leveled at the cognoscenti.

Yet, if you believe Watts, all that money and effort is being wasted. Because according to him, Influentials have no such effect. Indeed, they have no special role in trends at all.

In the past few years, Watts - a network-theory scientist who recently took a sabbatical from Columbia University and is now working for Yahoo - has performed a series of controversial, barn-burning experiments challenging the whole Influentials thesis. He has analyzed email patterns and found that highly connected people are not, in fact, crucial social hubs. He has written computer models of rumor spreading and found that your average slob is just as likely as a well-connected person to start a huge new trend. And last year, Watts demonstrated that even the breakout success of a hot new pop band might be nearly random. Any attempt to engineer success through Influentials, he argues, is almost certainly doomed to failure.

"It just doesn't work," Watts says, when I meet him at his gray cubicle at Yahoo Research in midtown Manhattan, which is unadorned except for a whiteboard crammed with equations. "A rare bunch of cool people just don't have that power. And when you test the way marketers say the world works, it falls apart. There's no there there."

Read the rest of the article ...

Leaders in Need of a Good Idea

From the Financial Times, German Edition, by Lucy Kellaway

"It's all very well using buzz-words and slogans like "thought leader" to describe new innovations, but what do they actually mean? After a bit of investigation, the concept seems to boil down to this: "thought leader' is simply a new and unhelpful way of saying successful.

First we were employees, plain and simple. Then we were knowledge workers. After that came "Brand Me" and the notion that we were all CEOs of Me, Inc. Now our taste for hyperbole in describing our place in the economic order has become still more rarefied: what every modern worker aspires to be is a thought leader.

The blame for this latest craze rests with the editor of Strategy and Business, a management magazine. In 1994, he needed a name for a new interview slot and came up with "Thought Leader'. Back then it seemed a forgivably pompous title for the pompous thoughts of management gurus. Thirteen years on, it has come to be a much less forgivable name for any old fool in possession of an ego and a blog.

The title offends for three reasons, and pomposity is the least of them. It is inappropriately Orwellian: in free societies, thoughts can be provoked or stimulated or gathered. But not led. Worse still, no one seems quite sure what "thought leader' means. You might think that to qualify as a thought leader you needed to have a thought (preferably a new one) and be able to influence other people with it. Yet mostly when the term is used there is no sign of any thinking or leading going on at all."

Read the rest of the article ...

Soggy

Seth Godin's blog has to be one of the "must reads" out there - so I hope he will forgive me for quoting this entry from a few days ago ....

"New organizations and new projects are so crisp.

Things happen with alacrity. Decisions get made. Stuff gets done.

Then, over time, things get soggy. They slow down. Decisions aren't so black and white any more.

Why?

Here are some things that happen:

• Every initiative, post launch, still has a tail of activity associated with it. Launch enough things and over time, that tail gets bigger and bigger.
• Most projects either succeed or fail. Successful projects raise the stakes, because the team doesn't want to blow it. There are more people watching, more dollars at stake, things matter more. So things inevitably get more review, more analysis and slow down. Projects that fail sap the confidence of the group. They want to be extra sure that they're right this time, so, ironically, they slow down and end up sabotaging the new work.
• The paper isn't blank any more. Which means that new decisions often mean overturning old decisions, which means you need to acknowledge that it didn't used to be as good as it was.
• And the biggest thing is that there is a status quo. Something to compare everything to.

I'm not sure you can eliminate any of these issues. But, you can realize that they're there. And you can be really strict about priorities and deadlines... it's so easy to let things slip, rather than confronting the fact that you're stuck and probably afraid. Speak up, call it out... and ship!"

Go to Seth's blog....

My book. Let me show you it ...

From Clay Shirky's blog - an ingenious way to get "attention"?

"I’ve written a book, called Here Comes Everybody: The Power of Organizing Without Organizations, which is coming out in a month. It’s coming out first in the US and UK (and in translation later this year in Holland, Portugal and Brazil, Korea, and China.)

Here Comes Everybody is about why new social tools matter for society. It is a non-techie book for the general reader (the letters TCP IP appear nowhere in that order). It is also post-utopian (I assume that the coming changes are both good and bad) and written from the point of view I have adopted from my students, namely that the internet is now boring, and the key question is what we are going to do with it.

One of the great frustrations of writing a book as opposed to blogging is seeing a new story that would have been a perfect illustration, or deepened an argument, and not being able to add it. To remedy that, I’ve just launched a new blog, at shirky.com/HereComesEverybody/, to continue writing about the effects of social tools.

Also, I’ve convinced the good folks at Penguin Press to let me give a few review copies away to people in the kinds of communities the book is about. I’ve got half a dozen copies to give to anyone reading this, with the only quid pro quo being that you blog your reactions to it, good bad or indifferent, some time in the next month or so. Drop me a line if you would like a review copy — clay@shirky.com"

Interesting ...

Innovation is an Inside Job

From the Heart of Innovation weblog, by Mitch Ditkoff.

"These days, almost all of my clients are talking about the need to establish a sustainable culture of innovation. Some, I am happy to report, are actually doing something about it. Hallelujah! They are taking bold steps forward to turn theory into action. My hat is off to all of them -- and sometimes, my head. Nevertheless, the challenge remains the same for them as it does thousands of other forward-thinking companies and that is, to find a simple, authentic way to address the challenge from the inside out -- to water the root of the tree, not just the branches. In other words, to get down to the essential DNA of what drives innovation.

In today's process-driven, OD-centric, Six-Sigma savvy organization, the tendency is to focus on systems as opposed to people -- as if systems were sufficient to guarantee change. Guess what? Systems are not sufficient to guarantee change. In the words of Oliver Wendell Holmes, "Systems die. Instinct remains."

Read the rest of the article ...

Leadership and Innovation

From the McKinsey Quarterly, by Joanna Barsh, Marla M. Capozzi, and Jonathan Davidson.

"Innovation has become a primary force driving the growth, performance, and valuation of companies. Our research reveals a wide gap between the aspirations of executives to innovate and their ability to execute.

Many companies make the mistake of trying to spur innovation by turning to unreliable best practices and to organizational structures and processes. Our research shows that executives who focus on stimulating and supporting innovation by their employees can promote and sustain it with the current talent and resources—and more effectively than they could by using other incentives.

Three approaches can help executives mount innovation efforts. First, senior management should actively support behavior that promotes innovation. Second, network analysis can identify where the capacity for innovation already exists within an organization and help it build more innovative networks. Finally, executives should seed innovative thinking by focusing on selected managers and projects."

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Best Practices in Leadership Development

It is just being announced that Mick is co-chairing the "Best Practices in Leadership Development Summit" in San Diego, September 16th -19th this year.

The keynote faculty includes:

• Carly FIORINA, CEO, Hewlett-Packard (1999-2005) and author of Tough Choices
• Bill GEORGE, professor, Harvard Business School; former CEO of Medtronic; author of Authentic Leadership
• Steve KERR, former managing director and CLO of Goldman Sachs, former CLO and VP of Leadership Development at GE
• Tom KELLEY, general manager of IDEO; best-selling author of The Art of Innovation
• Gary HAMEL, “the world’s reigning strategy guru” according to The Economist
• W. Chan KIM, author of Blue Ocean Strategy; professor of management, INSEAD
• Kelly HANNUM and Jennifer MARTINEAU, Center for Creative Leadership
• Roger NIERENBERG, former conductor of the Stanford Symphony; creator of The Music Paradigm
• Stephen MILES, regional managing partner Americas, Heidrick & Struggles; author of HBR article entitled: The Leadership Team—Complementary Strengths or Conflicting Agendas?
• Erin GRUWELL, celebrated and inspirational teacher depicted in the movie The Freedom Writers
• Bob FULMER, renowned expert in leadership development, co-author, Leadership by Design

The idea is to gain insight into the critical success factors, latest innovations, and greatest strategies used by the most advanced management and leadership development practitioners.

Developing great leaders and building a distinguished leadership brand is becoming more complex and more difficult with every passing year. How do you acquire or develop leaders with the range of skills, knowledge, and abilities required? How do you provide them with the tools and techniques needed for success? How do you stand apart from your competitors?

The Summit aims to provide the knowledge, network, and tools needed to maximize an organization’s leadership capability and brand.

You can find out more here ...
Technorati leadership tag

In Summary .... Tom Peters

From Tom Peters Blog ...

"I've been working on various forms of my Master Presentation, pretty much fulltime, for the last couple of weeks. A post yesterday started a rather vigorous discussion about success "rules" that withstand the test of time. Virtually nothing—you, me, the corporation, the nation—withstands the test of time. And one of the principal reasons is hardening of the philosophical arteries—increasingly rigid interpretations of yesterday's "success" rules.

So I outright reject success "rules" or "eternal" principles. Nonetheless (whoops, here it comes), you gotta do something. What follows is as far as I will go. My first list has three items:

• Cause (worthy of commitment)
• Space (room for/encouragement for initiative-adventures)
• Decency (respect, grace, integrity, humanity)

That is, find something useful that turns folks on, give them a lot of room to try their own interpretations thereof—and offer them the respect they deserve for participating in the game with commitment and determination.

I actually like my second list better, consisting of some four items:

• Hire Great People (Resilient, Passionate)
• Try a Lot of Stuff (S.A.V.-Screw Around Vigorously/R.F.A.—Ready. Fire. Aim.)
• All "Wow" All the Time (Shoot for the moon—in every circumstance)
• Enjoy It While It Lasts (And it ain't gonna last forever, so you might as well keep swinging)"

Read the rest of the article ...

Apples are Square

I don't often recommend books, but there is a new one out which you might find interesting - "Apples are Square", by Dr. Susan Smith Kuczmarski and Thomas Kuczmarski.

From their website:

"For centuries, leaders have been operating within a “control and compete” mindset. But the times are changing. More and more, at the helm of successful companies, you’ll find a different sort of leader. Collaborators, not controllers, they are “square apples,” bold men and women who dare to create success by reshaping the workplace in unexpected ways. In Apples Are Square, innovation consultants and celebrated authors Dr. Susan Smith Kuczmarski and Thomas Kuczmarski share with you the secrets of how to become a square apple in your organization.

To develop their groundbreaking strategy for success, the authors interviewed 25 leadership pioneers from many different work settings - media, the arts, government, sports, education, and business, including Craig Newmark, founder of craigslist; Mary Ellen Weber, former NASA astronaut; and NFL star Chris Zorich, whose personal story inspired the title of this book. With the tools in Apples Are Square, you’ll be able to take any bruised environment and reshape it into a positive force."

Read the rest of the article ...

Who Should Manage Innovation Projects?

From the InnovationTools blog, by Chuck Frey

I'm reprinting this is full, as I like the article and I know Paul's work ...

"At many organizations, innovation projects are often assigned to young, ambitious junior executives. But these efforts tend to be doomed to failure, according to Paul Sloane, writing in his new book, The Innovation Leader: How to Inspire Your Team and Drive Creativity.

Why isn’t this a good idea? Paul says that junior executives often get stymied by process and political obstacles that innovation projects usually face. An experienced manager with more political clout within the organization is more likely to be successful under these circumstances. Paul cites the example of IBM, whose culture used to be overwhelmingly focused on generating short-term results, which tended to short-circuit promising new products and services.

To reverse this trend, CEO Lou Gerstner and senior VP in charge of strategy J. Bruce Herrold reassigned their most experienced and talented executives to emerging business opportunity (EBO) units. The mission of these executives was to find new areas for IBM that could yield profitable billion-dollar businesses in five to seven years. This initiative was overwhelmingly successful, resulting in additional annual revenues of over US$15 billion and growth of over 40% per year.

"The lesson from IBM is clear. If you want to change the culture of an organization so that it values innovation and new business start-ups, then get your most senior and best people involved in these activities. Don't delegate to work to lower-level staff and hope for the best."

I think Paul is onto something here. Conventional wisdom says that if you have an established line of business, a cash cow that is generating millions of dollars a year in revenues, the last thing you want to do is move that person into a new business venture that may take years to turn a profit. But these are the very people that have the contacts and the clout within the organization to get things done, to build consensus and to overcome hurdles.

Of course, you will need to select senior-level people who also have an entrepreneurial spirit and who are open to new ideas, because the skills needed to successfully launch a new business are significantly different than those needed to manage an existing one.

So who's in charge of your company's innovation initiatives?"


Technorati innovation tag