What are the Challenges Facing Distributed Organizations? Part 2

Interview with David Van Wie, CEO, and Paul Brody, President, Sococo, Inc.

Situation: Research shows that 65% of teams within companies are now geographically distributed. This is driven by both telecommuting and the desire to access the best talent, and is enabled by technology. What are the implications of distributed teams for company and project success, and how can these be addressed?

Advice from David Van Wie and Paul Brody:

  • A second example of a critical challenge occurs in crisis mode – for example when a major system is down and service is impaired.
    • You need the right people with the right information talking real time. Those without complete information are at a loss. If they respond from emotion rather than fact, it hinders crisis resolution.
    • Having an avatar in Team Space yields a positive emotional response, primarily in that you then interact with other avatars instead of just names on a list. It gives you an increased feeling of presence.
    • This emotional investment positively correlates to increased trust, as you feel more connected to your peers.
    • You want an environment in which you can bring distributed people together on the fly, provide them with complete information, raise and candidly discuss issues and alternatives, and come up with a solution with all parties involved, all while reducing the emotionality of the situation.
    • Emotionality of tense situations is reduced because of the trust built amongst team members through our unique spatial UI.
  • Third, organizations beyond a certain size tend to form silos by function. This can help to build strong functional organizations, but has drawbacks when different functions have conflicting priorities.
    • In a distributed organization, a visual layout becomes important. You want to be able to include and intertwine all functions in a visual space, and provide access between and across functions.
    • This entails a philosophical shift to an open culture where teams don’t feel defensive or protective. It is facilitated by a visual space where it is easy to bring in the right expertise to resolve issues based on information.
    • Likewise, the underlying open structure of Team Space and its ability to promote quick conversations as well as hefty meetings helps solidify trust in a distributed group.

For more information on Team Space, visit www.sococo.com

Key Words: Distributed, Teams, Presence, Collaboration, Workflow, Project, Agile, Conflict, Crisis, Silo  [like]

What are the Challenges Facing Distributed Organizations? Part 3

Interview with David Van Wie, CEO, and Paul Brody, President, Sococo, Inc.

Situation: Research shows that 65% of teams within companies are now geographically distributed. This is driven by both telecommuting and the desire to access the best talent, and is enabled by technology. What are the implications of distributed teams for company and project success, and how can these be addressed?

Advice from David Van Wie and Paul Brody:

  • A fourth question which arises with distributed organizations is whether you have to have different processes to manage a distributed organization.
    • We don’t think so. Each company has developed their own set of process to address the challenges of distributed personnel. Rather, we focus on communication tools that adapt to clients’ existing processes by humanizing communication – enabling people to easily find each other and share information.
  • Fifth, some of the most challenging environments occur in organizations which span extreme time zone differences. How is this addressed?
    • You want an audio and visual system that lets you know who is available at a given point in time or could be made available easily. This facilitates bringing the right expertise into a conversation.
    • When different parts of the team are widely separated by time zone, it is important to create a more social and effective environment during the times when all team members are available. We believe that Team Space helps to create this environment.
    • In one company, Indian team members stay at the office until 7:00pm – thereby avoiding the worst traffic – and can be available online at home after dinner. This increases the time that they can interact with their American counterparts.
    • It is also important to be able to record meetings and presentations so that members who are absent can play back the meeting to stay up to date.
    • Our experience is that visual presentation is superior for communicating visual information, and we accommodate this.

For more information on Team Space, visit www.sococo.com

Key Words: Distributed, Teams, Presence, Collaboration, Workflow, Project, Agile, Conflict, Crisis, Silo  [like]

What Are Best Practices for Selecting Business Development Staff? Four Thoughts

Situation: A company wants to expand its business development staff. What is your experience, and what has worked best for you in selecting among business development candidates?

Advice from the CEOs:

  • Your first priority is your compensation plan for the new person. There are three basic compensation schemes:
    1. High Base/Low Commission
    2. Medium Base/Medium Commission
    3. Low to No Base/High Commission
  • Choice between these options depends on your own philosophy, as well as common practice within your industry. Compensation is central to candidate selection. The CEOs recommend asking candidates about their own preferences for compensation.
    • If they prefer Option 1, don’t hire them – they either lack experience or confidence.
    • They ideally prefer Option 3 – they can make more money, but cost you little unless they perform.
    • If they prefer Option 2, probe. They may be good but face personal obligations that make it difficult to choose the high risk/high reward option. Ask about past compensation and performance. Verify any claims made during the interview.
  • You want to structure sales compensation so that non-performers leave of their own accord – without costing you dearly in time or money.
  • What are the most important traits to seek in a good B.D. candidate?
    1. Understanding of customer’s requirements as well as purchase behavior.
    2. Understanding of your product or service.
  • How do you find candidates?
    • Use a Head Hunter who knows your industry and competitors.
    • Use written tests to evaluate the individual’s traits.
    • Let the recruiter find and screen prospects and present the top 2-3 to you.

Key Words: Business Development, Candidate, Compensation, Experience, Traits, Evaluation, Base, Draw, Commission, Industry Practice, Verification, Performer, Non-Performer, Selection, Head Hunter, Personnel, Recruiter, Test

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How Does an Entrepreneur Evolve from Doer to Leader? Four Suggestions

Situation: A company has grown largely through the determination and energy of the founding CEO who is still the principal business development resource. The CEO wants to move from day-to-day focus to a leadership role, planning for the future. How have you evolved from principal doer to leader?

Advice from the CEOs:

  • Start by developing and managing an organizational chart for the business.
    • Create the organizational chart initially by role and responsibility.
    • Match existing people to the roles. Individuals may fill more than one role, but be sure that the individuals are suited to the roles to which they are assigned.
  • Give ownership of areas of responsibility to others.
    • Make it clear for each area of responsibility that the individual assigned is now in charge.
    • Match projects or assignments with individuals’ abilities and available time.
    • Establish quarterly or annual performance objectives WITH as opposed to FOR each individual – objectives that support company objectives.
    • See that people are rewarded for their results – both soft and monetary rewards – as appropriate to the responsibility held by each.
  • While you continue as the lead of business development, hand off new clients to others as soon as you get them on-board. Let others take on the customer nurturing and maintenance roles. Establish a plan to replace yourself in this role.
  • The EMyth Revisited by Michael Gerber provides a soup to nuts recipe for moving from doer to leader of a company. Everything starts with your organizational chart.

Key Words: Leader, Doer, Role, Focus, Organizational Chart, Org Chart, People, Match, Ownership, Responsibility, Performance, Objectives, Reward, Results, EMyth, Gerber

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What Are The Barriers to Companies Moving to The Cloud?

Interview with Jim Kaskade, Global Executive (most recently SVP and General Manger, SIOS Technologies, Inc.)

Situation: Cloud computing as a concept dates back to the 1960s. “Cloud” became a more prominent concept in 1990s as a metaphor for service delivery over the Internet. The technology that makes it a practical reality has advanced significantly. Broad business adoption, however, has varied depending on the deployment architectures used. What are some of the barriers to enterprises “crossing the chasm” and embracing moving to the cloud?

Advice:

  • Definitions: There are three cloud deployment architectures or market segments when defining the opportunities and barriers to entry:
    • Software as a Service – SaaS – represented by distinct B2B applications like Salesforce.com and Google Apps, and B2C applications like Apple’s iCloud.
    • Platform as a Service – PaaS – represented by application platforms targeted at application developers and including Microsoft Azure and Amazon Beanstalk.
    • Infrastructure as a Service – IaaS – represented by on-demand access to low-level IT infrastructure such as virtualized computer, storage, and networking infrastructure.
  • The elephant in the room is that, relative to global IT spend, use of public cloud is in its infancy.
  • Adoption of the cloud varies by business size and IT structure.
  • Start-ups – particularly technology start-ups – use all three segments. The rationale is simple. It is easier and conserves capital to use all three delivery segments as an expense rather than invest in IT infrastructure. Another benefit is time to market.
  • Mid-sized companies  – up to hundreds of employees – have more challenges.
    • They start with SaaS applications to get their feet wet. Primary concerns are availability and security. If they have good, dependable Internet access, barriers to entry can be low.
    • Using a PaaS is also attractive but begins to compete with internal, existing platforms. Mid-sized companies typically have their own IT and developers who may prefer an internal platform. The company’s choices are also limited to a PaaS system that is similar to current development platforms.
    • The barrier to IaaS adoption is the IT staff itself. If the IT staff is savvy, they can maintain and run their internal data center less expensively than IaaS services. The question comes down to whether building and maintaining a “crazy smart” IT group is core to the company’s business model.
  • Enterprise companies – Fortune 100s or even 1,000s – have far greater challenges.
    • Their current IT model already has moved to a mix of 30% in-house and 70% outsourced with partners like CSC and Accenture.
    • Most Enterprise CIOs begin their use of “cloud” with a migration to SaaS. The barriers to PaaS are that their systems are tailored to customer-specific applications and internal infrastructure, limiting PaaS use to small, non-critical applications which require quick, global deployment.
    • The barriers to using IaaS services are similar to PaaS, where CIOs struggle with tradeoffs between agility and issues of cost, security, and availability.
    • The Achilles’ heel of these companies is that 80% of their IT spend is just keeping the lights on.
  • The implications of all this are that the cloud is ideally for small to medium companies, some of which will become large enterprises. If you can succeed with a migration of legacy applications to cloud-based services you will become more nimble in responding to customer’s needs – the biggest upside to cloud services in general.

You can contact Jim Kaskade at jim.kaskade@gmail.com

Key Words: Cloud Computing, Adoption, SaaS, PaaS, IaaS, iCloud, Business Size, IT, Structure, Staff, Applications, Cost, Nimble, Availability, Security, Chasm, Start-up, Mid-Size, Enterprise, Outsource, Partner, Data Center, Legacy

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How Do You Reduce Dependence on One Large Customer? Three Thoughts

Situation: A company has been very successful, but one customer represents over 60% of their sales. To grow, the company needs to diversify its customer base. How do you reduce dependence on one large customer, and what are the risks involved?

Advice from the CEOs:

  • The key to getting new customers is to dedicate time and resources to the task.
    • Consider hiring a sales professional – a commission based “hunter” who has experience landing big accounts. You may pay this person a hefty commission for brining in new business, but diversifying your customer base can be worth it.
  • If there is shared ownership of technology co-developed by the company and client and the client does not wish to pursue markets beyond its strategic focus, is it feasible to negotiate rights to pursue this business?
    • The larger client will pursue their own interests, not those of the smaller vendor. Perhaps a win-win can be worked out, but it may be difficult – particularly if the client is concerned that use of the technology in other markets could have a negative impact.
    • Caution. The easiest way for the client to defend itself from a perceived threat is to sue and bury the smaller vendor through legal expenses. Regardless of who is “legally right,” deep pockets can win through attrition.
  • Consider recreating the opportunity. Create your own adjunct proprietary product with your own software or design talent and use this to expand your horizons.
    • Be aware, the large client can still sue if they believe that your proprietary product impinges on their rights.

Key Words: Revenue, Risk, Markets, Sales Person, Hunter, Commission, Technology, Shared Ownership, Legal Suit, Adjunct, Proprietary, Rights

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What is the Future of Digital Marketing?

Interview with Vikas Sharan, CEO, Regalix, Inc.

Situation: In traditional marketing, many marketers are more focused on activity than results. In the digital environment, top marketing organizations must become better at listening to their customers, watching them, and tracking their purchase decision behavior. What does this mean for the marketer?

Advice:

  • The digital world has changed marketing.
    • The traditional marketing campaign was led by creative. Through the early 90’s marketing was directed by media players and large publishers. Once a campaign was developed the pitch was “buy lots of impressions and customers will come.”
    • During the dot.com boom and into the 2000s there was a shift to ROI – spend $x with Google, get y clicks that will yield z buying customers. This was very transactional and could be expressed relatively simply.
    • Behavior is now changing, and the model is becoming more collaborative:
      • A potential customer expresses interest and a need.
      • A supplier offers a solution.
      • The potential customer verifies and validates the offer through online communities, Twitter, Facebook or other resources, and eventually may make a buying decision based on what they find along the way.
      • The buying decision today is very different from the traditional offer-driven process.
      • All of this can happen in minutes.
  • For the marketer, this means moving far beyond the simple advertisement.
    • The marketer needs a presence on Facebook, Twitter, and many more sites, in addition to their website, to woo potential customers.
    • For marketers this is expensive and requires a different level of resource commitment. It is, therefore, important for them to attribute the appropriate value to each online presence that the customer engages as they evaluate their buying choices.
    • Only through developing complex metrics, which change real time as customer behavior changes, can the marketer track and understand customer behavior and adapt the offer to the needs of the customer.
    • As individual consumers increasingly engage employ new forms of digital technology the challenge to marketers only increases.
  • The digital marketer who will thrive will develop a sophisticated, metric-driven understanding of the multiple touchpoints and social interaction of a given transaction.

You can contact Vikas Sharan at vsharan@regalix-inc.com

Key Words: Digital, Marketing, Customer, Behavior, Conversation, Online Communities, Facebook, Twitter, Touchpoint, Measurement, Metrics

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How Do You Move from Early Adopter to Mainstream? Ten Thoughts

Interview with Russell Glass, CEO, Bizo, Inc.

Situation: A company has established market leadership in an emerging market. When you innovate in a niche, focusing on early adopters, eventually you run out of early adopters. The challenge is broadening the appeal to a larger mainstream customer base. How do you cross the chasm from early adopter to mainstream?

Advice:

  • The challenge is both messaging and cultural.
    • In messaging, you must support the new norm. This means convincing the customer that if they are not with you, they’re being left behind. You need to demonstrate that your established, proven solution is the new norm.
    • The cultural challenge is maintaining a culture of innovation and attracting the right talent while becoming a mainstream company. An attraction to new talent is that you are cutting edge – changing the world. This aura is critical to a start-up. You must maintain this innovative culture as you become the market leader.
  • How do you overcome these challenges?
    • Finding people who’ve been there and done that increases the odds in your favor. We hired a marketer who had helped take SuccessFactors through the same transition.
    • Hire for excitement, energy and enthusiasm. Quickly remove new hires that turn out not to fit.
    • Maintain a freedom to fail atmosphere. You need people who will take risks, but who will also step back and quickly change direction when the risk isn’t productive.
    • Decision-making speed is a great advantage of small companies.
  • Create an organization that celebrates innovation.
    • We have “Hack Days” when employees are free to work on projects of their choice. A new product that brings business audience targeting to social media came from a Hack Day project.
    • Keep everyone informed. We have company-wide daily stand-ups. Individual updates are quick – 30-45 seconds. This fosters open communication and awareness, and surfaces issues before they become problems.
    • Weekly, we send out full disclosure emails including key financial metrics, successes and failures.
    • Monthly we have executive-only stand-ups. These are longer, but updates are quick and focus on progress to goals, as well as next month’s goals.

You can contact Russell Glass at glass@bizo.com

Key Words: Market Leader, Niche, Innovator, Early Adopter, Mainstream, Crossing the Chasm, Messaging, Culture, Cutting Edge, Hiring, Decision-making, Communication

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How Do You Communicate Benefits Changes After Being Acquired? Seven Suggestions

Situation: A company was recently acquired. The acquirer wants to merge benefit structures between the two entities. While company contributions are similar, distribution of benefits between retirement plans, health plans, and other benefits between the entities varies considerably. How do you approach the staff about the changes in a positive manner?

Advice from the CEOs:

  • Ideally, you want to survey employees on what is and is not important to them about their benefits before the package is finalized. This will help you negotiate on your employees’ behalf.
  • Ask the acquirer whether a “cafeteria” benefit program is feasible. This would allow your employees to make choices among benefit options, and to fund these choices either at a company-paid base level or to supplement their choices through payroll deductions.
  • Inform the acquiring company of your state’s regulatory policies on state-specific benefits.
  • Once the new benefit package is finalized, ask for assistance communicating the new package to your staff. Create a simple and concise grid for the program:
    • Amount of company contribution,
    • Old program and benefits,
    • New program and benefits,
    • Use the grid to demonstrate that while the allocation may be different, the company contribution remains the same and the total value of benefits offered is unchanged.
  • If you know that a highly valued benefit is being reduced, consider a short-term subsidy to ease the shift.
  • Be clear about decisions that your employees must make in the new program.
  • If you have access to industry or regional comparisons for like-sized companies, you may wish to share these.

Key Words: Acquisition, Benefit Structure, Change, Employee Input, Cafeteria Plan, Options, State Requirements, Short-term Subsidy, Comparison

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How Do You Select The Right Strategic Partner? Three Guidelines

Interview with Jim Soss, CEO, Red Aril

Situation: A rapidly growing company is expanding both in its primary market and into new verticals. A number of companies are interested in strategic partnerships. How do you select the right partner in the right space?

Advice:

  • At the end of the day it’s about a connection with the partner which extends across both organizations.
    • Look for cultural synergy with the other company. Do your and their managers and employees “click” or are they oil and water? This is a gut assessment.
    • Is the quality of people in both companies complimentary? Is there similar drive for quality and attention to detail?
    • Will technical integration be smooth? Are systems complimentary? At a minimum are there the right skills on both sides so that this won’t hinder the project.
    • Are sales and marketing approaches compatible? Will teams be able to work together? What about other departments?
  • You need to have strategic commitment across both organizations.
    • Partnerships don’t work if there is only alignment at the top. Executives can’t shove a new opportunity down the throats of those who report to them. There must be excitement about the opportunity across both sides of the partnership.
    • There must be complimentary competencies, capabilities and commitment.
    • Is there a clear understanding of the goals and objectives succeed?
    • Reward structures and incentives must be aligned down through the two parties. Conflicts will lead to struggles.
  • There must be a strategic alignment between the two organizations so that both see the partnership as complementing their broader strategic plans.
    • There must be a fundamental strategic win-win. The venture must be seen by each party as core to their business, plans and results. If this isn’t present, the collaboration can be drowned when a better opportunity that comes along.
    • Look for some gauge that the partnership is as important to the other party as it is to you. What other partners do they have? Is the size of the opportunity enough so that you are assured of their ongoing attention?

You can contact Jim Soss at jsoss@redaril.com

Key Words: Partner, Partnership, Connection, Culture, Synergy, Quality, Integration, Systems, Complimentary, Commitment, Alignment, Capabilities, Rewards, Incentives, Strategic Plan

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