from the Desk of Keith Parnell

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You CAN Give That Killer Presentation

Here is a very good tip from Chris at HBR on speaking in front of people and being nervous about just doing so or even being worried if your topic is interesting to others.

“If you frame the talk as a journey, the biggest decisions are figuring out where to start and where to end. To find the right place to start, consider what people in the audience already know about your subject—and how much they care about it. If you assume they have more knowledge or interest than they do, or if you start using jargon or get too technical, you’ll lose them. The most engaging speakers do a superb job of very quickly introducing the topic, explaining why they care so deeply about it, and convincing the audience members that they should, too.”

Source: How To Give A Killer Presentation

How Agile is Your Company?

Harvard Business ReviewA successful company in 2013 cannot use the same strategic formula that we used in 1997, or 2004 for that matter. Outside forces, new technologies, and probably more importantly, consumers’ acceptance of innovative technologies have forced companies to be more receptive to change . . . and even, in some circumstances, lead the process of being agile embedded within their business strategies.

In a combined white paper, Walter Popper, Brad Power, and Steve Stanton wrote:

Rational managers for the past thirty years have tightly focused on efficiency, cost cutting, and day-to-day execution – perhaps to a fault. With increasing industry disruption, efficiency is fast becoming of secondary importance to innovation and agility. Many large organizations have too little capacity for external sensing, strategic reflection, and business transformation.

For Harvard Business Review, the authors go on to say that companies must stay on top of external forces or be trampled by these threats:

The pace of change and disruption in today’s marketplaces will only increase. Organizations that focus only on their surface systems, no matter how well they operate and how low they drive their costs, will miss the threats to their long-term survival. No company is immune; no market niche is safe.

Sloppy Is As Sloppy Does

Thanks to a great friend for enlightening me to this article. Here’s my favorite section of the article: “I hire people who care about those details. Applicants who don’t think writing is important are likely to think lots of other (important) things also aren’t important. And I guarantee that even if other companies aren’t issuing grammar tests, they pay attention to sloppy mistakes on résumés. After all, sloppy is as sloppy does.

* Article source: I Won’t Hire People Who Use Poor Grammar. Here’s Why.

How to Take a Month Off Work

I like the idea of taking a month off work. I need to read more of Dorie’s articles on Harvard Business Review.

It’s an elusive dream twinkling in executives’ eyes: what if I could take an entire month off? The lure is obvious: the chance to truly unwind, to recharge your creativity, and to visit faraway places you can’t reach on a week-long jaunt.

Plan far in advance.

Decide how reachable you want to be.

You’re going to lose money — deal with it.

Give yourself permission to wander.

So — are you ready to take a month off? What’s necessary to make it happen? And where are you going?

How to Take a Month Off

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Six Predictions for Digital Business in 2012

George Eliot observed that “among all forms of error, prophesy is the most gratuitous.” Yogi Berra is said to have said the same thing in less adorned language: “It’s tough to make predictions, especially about the future.” So a lot of what’s below will be off-base or dead wrong. But predictions are both fun for writers and popular among readers, so here goes. My crystal ball devoted to the intersection of business and digital technology brought forth six predictions for 2012. They are:

1. The iPad will gain some worthy adversaries. 

2. A Fortune 500 company will move its productivity and collaboration apps to the cloud.

3. A web-native bank will appear and inspire fanatical devotion among its customers. 

4. There will be at least one instance of a science fiction technology becoming reality. 

5. Job prospects and wages will not improve much for the average American worker. 

6. The material conditions of life will continue to get better for most people, in most countries. 

Six Predictions for Digital Business in 2012

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CEOs Need to See Through Walls

The key to reforming capitalism lies in creating shared valueby harnessing the power of business to solve social problems. Paradoxically, in these difficult economic times, the business opportunities hidden in our urgent social problems offer the greatest potential for profit and growth most businesses will ever face. But there is a trick to discovering these opportunities: It takes a CEO who can see through walls to find them.

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Increase Your Companys Productivity With Social Media

Done right, social tools can resolve longstanding issues of knowledge loss and inefficiency. To harness the productive power of social tools in your company, make sure you have the following eight elements in place as you roll out social network for your company:
  1. Strategy: Be sure there is buy-in and engagement from senior executives who are willing to lead by example.
  2. Alignment: Get involvement from stakeholder groups across the company.
  3. Technology: Determine the right mix of tools and technologies.
  4. Pilot: Identify pilot groups like Unisys did with the sales team.
  5. Governance: Establish guidelines for governance.
  6. Communications: Develop a communications plan.
  7. Metrics: Identify hard business metrics like increasing speed to innovation or speed for winning new business.
  8. Implementation: Create process for enterprise wide implementation new skills needed for success like social media literacy.
(For more, see this infographic on implementing social learning.)
Once your program is up and running, be sure to profile early successes in using social media to increase productivity. Employees need to be able to answer the “so what” of social media.

Increase Your Company’s Productivity With Social Media

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Where Have All the Leaders Gone?

So true, this is. Our true thought leaders have disappeared. Do you have a leader that you look up to in your professional segment?

Leaders of the past almost always seem more effective than those of today. It’s a perceptual bias: We long for what we don’t have, and mythologize what we used to have. But even taking this bias into consideration, many of today’s leaders don’t seem to measure up to our expectations.According to a survey conducted by the Harvard Kennedy School last year, 68% of Americans believe that there is a “leadership crisis” in the country; and leaders in only four out of thirteen sectors inspire above average confidence (the military, the Supreme Court, non-profits, and medical institutions). Leaders of the news media, Congress, and Wall Street receive the lowest scores.

My parents used to tell me that the leaders of their day not only inspired confidence, but respect and reverence as well. They talked about Roosevelt, Churchill, Eisenhower, Ghandi, and others of that generation as larger than life figures. Growing up, I had the same impressions of John and Robert Kennedy, Martin Luther King, Margaret Thatcher, Ronald Reagan, Mikhail Gorbachev, and others. Sure they had their flaws, but they were courageous and decisive, and could communicate in ways that made it clear what they stood for.

But today’s public figures don’t seem to inspire the same confidence. According to Gallup figures, only 43% of Americans think that President Obama is doing a good job (up from a low of 38%); and only 15% have a favorable view of Congress. Even in the corporate sector, confidence in leaders may be waning (at least from their boards): According to a study by the search firm Crist Kolder Associates, CEO turnover in Fortune 500 and S&P 500 firms this year is running at 13%, up from 10% last year.

The irony is it’s likely that more money has been spent on leadership development in the last two decades — in both the public and private sectors — than was probably spent in the previous ten decades combined (admittedly I’m guessing here; no figures seem to be available). So why are we not turning out better leaders across the board? Let me suggest two possibilities — and perhaps readers will add others:

First, the velocity and volume of issues that leaders are confronted with today has increased substantially. This doesn’t mean that the previous generations of leaders had it easy; rather they had more time between decisions than leaders have today. Now, with the advent ofinstantaneous communication across the globe, leaders have very little time to think. Most of the senior executives that I’ve worked with, in both the public and private sectors, are inundated with information and overwhelmed with meetings. They move from one issue to the next with frequent interruptions as new developments occur. Relaxed time to think, reflect, and plan is limited and fragmented. But leaders who don’t find ways to carve out that quality time reduce their effectiveness.

A second reason for the diminished confidence might be that many of today’s leaders are overly concerned with the reactions of their stakeholders. This may sound odd, since a key function of leadership is to tune in to the needs of the people they are leading. Listening, however, only goes so far, particularly when the many voices do not agree. At some point leaders need to declare their intentions, even if not everyone will be happy. For this reason today’s leaders often hesitate to do what they think is right. Instead politicians seem to base their policies on polling trends, while corporate leaders worry about the reactions of analysts and traders. In contrast, respected leaders drive towards a longer-term vision and find ways to handle the speed bumps along the way.

Of course comparing leaders from different generations has no right answer — just like the arguments about who would win an athletic contest between teams from different eras. But if reflecting on the question helps us find ways of increasing leadership effectiveness today, maybe it’s worth some debate.

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The Peanut Butter and Jelly Approach to Growth

Another great article from Harvard Business Review.

According to the U.S. Census Bureau, a record 46.2 million Americans are now living below the poverty line, as more and more people fall out of the middle class. For many companies, a shrinking middle class means a shrinking top line, as their traditional consumer base migrates to the lower end of the market.

But not for the J.M. Smucker Company.

The 114-year-old outfit, based in Orville, Ohio, now sits at #2 on this year’s Barron’s 500, which ranks publicly traded companies purely according to growth metrics — not revenue itself but changes in sales, profits, and return on investment. This accomplishment is even more impressive when you consider that Apple is #4 on the list.

Smucker’s? That’s right — the outfit best known for selling peanut butter and those iconic jars of jam that haven’t changed much since the company was founded in 1897. How did such an old-school consumer brand company make it near the top of a list of hot growth firms?

The numbers are there. Smucker’s impressive annual results cap a decade in which the 4,500-employee firm achieved compound annual revenue growth of 23% and per-share earnings growth of 14%. Shareholder returns matched profits exactly, at a compound 14%. For 2011, it all added up to $4.8 billion in sales. That’s a lot of PB&J.

According to chairman and CEO Timothy Smucker, 67, who is now stepping down to hand the jars to his younger brother Richard, 63, “Volume gains in the fruit spreads category were supported by investments in advertising and product innovation.” This is a company where synergy really matters, as jelly growth led to “strong peanut butter performance.”

But a closer look at Smucker’s reveals a powerful set of growth strategies driving these results:

A strategic approach to acquisitions. Smucker’s has grown over the past decade largely by taking on cast-off food brands from Procter & Gamble, its Ohio consumer products neighbor, and finding ways to grow them again. In 2001, Smucker’s acquired Jif and Crisco from P&G, which no longer saw them as a strategic fit. Then in 2008, it acquired P&G’s Folgers brand and made it the foundation of a new coffee division.

This strategy reflects the “create, operate, trade” principle of Richard Foster, the former McKinsey executive who (full disclosure) is now lead board member at Innosight. The idea is that a business unit that no longer fits one company’s objectives can become the foundation of new growth somewhere else. At Smucker’s, all three of these former P&G brands are #1 in their categories.

A focus on innovating consumer experiences, not company products. Smucker’s has also grown by studying why and how people actually use products to do things in their lives, or as we at Innosight think of it, to “hire products to get key jobs done.” New insights have led to new products and line extensions. For instance, it created Crustables, frozen, self-contained PB&J sandwiches that can be easily popped into a school lunch bag in the morning, where they thaw and are ready to eat by noon. For at-home PB&J dining, Smucker’s offers Kidvitations, an on-line service that enables parents to design and print invitations “to spend time together and share the perfect PB&J.”

Capitalizing on the emotional equity of its brands. “With a name like Smucker’s it has to be good.” “Choosy Moms choose Jif.” Generations of consumers grew up hearing these taglines, forever tying the Smucker’s brands to memories from their childhoods. Now, for adults facing the stress and uncertainty of the Great Recession, these emotional associations offer a reminder of simpler, easier, and safer times, and a way to show comfort and care to family members. Similarly, as jobless consumers can no longer afford Starbucks, Folgers’ “best part of waking up” tagline evokes a return to a time when a cup of coffee was cheap, and you made it yourself.

Smucker’s is hardly the only company capitalizing on the shrinking middle, as retailers and other consumer packaged goods makers find ways to turn contraction into growth, according to a recent article in the Wall Street Journal. But Smucker’s might be the company most emblematic of this troubling trend. After all, PB&J is both the ultimate lunch-on-a-budget food and the ultimate comfort food. Consumers in this economy are looking for both.

The Peanut Butter and Jelly Approach to Growth

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3 Rules for Networking at Work

We often think of networking as connecting with people outside our organizations. But networking with internal colleagues is just as crucial. Here are three rules of thumb for growing your network inside the office:
  • Build outward, not inward. Don’t waste time deepening connections with people you already know. Get in touch with people in other teams or business units.
  • Go for diversity, not size. Rather than aiming for a massive network, build an efficient one. This requires knowing people who are different from you, and from one another.
  • Go beyond familiar faces. Identify the “hubs” in your company—people who’ve worked on a variety of teams and projects—and ask them to connect you to others.

3 Rules for Networking at Work – Management Tip of the Day – Harvard Business Review

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Passing the Kitchen Table Test

Leif Johansson, recently retired CEO of the Volvo Group, has a simple and powerful test to track his progress as a leader. In addition to the usual metrics — return on investment, growth in market share, increases in shareholder value — Johansson uses what he calls the “kitchen table test”: At breakfast with his family on Saturday mornings, he asks himself, How easy is it to explain what I have accomplished this week and the decisions I have made? Does my family get it? Does what I say make them proud? Does it make me proud to tell them about it?

Johansson is a prime example of what my co-authors and I call a higher-ambition leader. Higher-ambition leaders seek to do more than outperform the competition. They aspire to win — powerfully and consistently — with their customers, their people, their partners, and their communities, as well as with their investors. They see winning on all fronts as both good business and a source of pride and purpose — a sure way to pass the kitchen table test.

The higher-ambition leaders profiled in our book are not unique. Rather, I believe there are a large and growing number of leaders who share these values and aspirations.

These leaders believe in the value of higher ambition for both personal and pragmatic reasons. On a personal level, they understand that they will feel a lot better about investing most of their waking hours at work, if their work is genuinely making the world a better place.

On a pragmatic level, anyone who has ever tried to run a business, whether a corner grocery store or a Fortune 100 company, knows that they won’t last very long if they don’t go the extra mile to provide real and distinctive value for their customers. They also know that it is much easier to win in the marketplace if they have energized and engaged people working on their team. Finally, they know that business doesn’t exist in a vacuum. When a company is not seen as a force for good, recruiting good people and partners is tougher, as is working with regulators and governments. Conversely, when everyone in the business — not just the CEO — can pass the kitchen table test with their families and talk with pride about their work, employee commitment and motivation will likely be off the charts.

So, the challenge for most leaders isn’t whether they should be trying to excel at providing value to all stakeholders, but rather how to address the genuinely difficult leadership and management challenges that arise while actually making this happen. For example:

  • How do you deal with difficult business decisions that affect employees and communities — such as restructuring, downsizing, and outsourcing — without leaving your humanity at the door?
  • How do you build the same sense of quarter-by-quarter accountability for long-term success as for meeting short-term numbers?
  • How do you develop a winning strategy that distinctively reflects and builds on your company’s core capabilities, values, and purpose?

In the weeks ahead, my colleagues and I will be sharing some of the hard lessons learned by higher-ambition leaders when addressing these types of issues. In the meantime, it would be great to hear about what you and the people you admire are doing to pass the kitchen table test.

Passing the Kitchen Table Test

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How Entrepreneurs Find Opportunity

In 2003, Jim Poss was walking down a Boston street when he noticed a trash vehicle in action. The truck was idling at a pickup point, blocking traffic, with smoke pouring out of its exhaust. Litter was still all over the street.

There has to be a better way, he thought to himself.

Looking into the problem, Poss learned that garbage trucks consume more than 1 billion gallons of fuel in the U.S. alone. They average only 2.8 miles per gallon and are among the most expensive vehicles to operate. In the early 2000s, municipalities and waste collection services were considering more fuel-efficient vehicles and better collection routes to reduce their overall costs and environmental footprint. Poss was not convinced that this was the right approach.

Through discussions with diverse stakeholders, he turned the problem upside down: the answer might not be about developing a more efficient collection process, but about reducing the need for frequent trash collection. As he considered this solution, he discovered multiple benefits: if trash receptacles held more trash, they would not need to be emptied so often; if trash did not need to be collected so often, collection costs and associated pollution would be reduced; and if receptacles did not overflow, there would be less litter on the streets. There were many advantages to this approach.

By applying the solar technology he used at work, Poss envisioned how a new machine might better manage trash. His initial concept of a solar-powered trash compactor was dismissed in favor of other ideas for environmentally friendly inventions, including a machine that would generate electricity from the movement of the ocean. Nonetheless the problem and the potential solutions continued to occupy his mind. “I took pictures of trashcans on my honeymoon,” Poss confessed.

He began to involve others, choosing a team based on who he knew might be interested within his social network. “We are motivated in part because we care about the environment and in part because we know this can be financially successful.” Poss and his assembled team experimented with a variety of options and finally returned to — the Big Belly — an innovation that provides clear solutions to the problems he noted on the city street that day. The current version can hold up to five times more trash than traditional receptacles. As a result, it dramatically decreases the frequency of trash pickup and cuts fuel use and trash-truck emissions by up to 80 percent.

Entrepreneurial leaders like Jim Poss create opportunities using three practices that we have observed again and again in our research of over 1,500 organizations in the past two years. While each practice is separately rooted in existing theory, entrepreneurial leaders distinguish themselves by adroitly circulating between all three, as Poss’s story illustrates:

Relying on self and social awareness. Entrepreneurial leaders shape opportunities within the context of who they are, what they know, and who they know. Notice how Poss began with a problem he experienced directly in his life, linked that concern to his expertise in solar technology, and then connected his ideas with others in his community and his broader networks.

Employing cognitive ambidexterity. This practice is characterized by switching flexibly back and forth between “prediction” and “creation” approaches to thought and action. The prediction approach, which is based on analysis using existing information, works best under conditions of certainty and low levels of perceived uncertainty. The creation approach, on the other hand, involves taking action to generate data that did not exist previously or that are inaccessible. Note how Poss used the prediction approach as he analyzed available operational and financial data on trash truck fuel consumption. In situations where data wasn’t available, Poss generated data himself by creating conversations and prototypes to guide his next steps.

In some instances prediction and creation logics are portrayed as incompatible methods of thought and action. However, in our research into entrepreneurial leadership we found this distinction to be artificial. Through conscious effort, one way of thinking can be used to inform and progress the other way of thinking, making the approaches complementary. Moreover, by engaging prediction and creation approaches, entrepreneurial leaders are able to create greater value than if they had tried only one of these approaches.

Considering social, environmental, and economic value simultaneously. We use the acronym SEERS — which refers to social, environmental and economic responsibility, and sustainability — to capture the full scope of impacts that entrepreneurial leaders consider at once. Consider how Poss was able to simultaneously consider customer benefits (reduced costs for municipalities) and environmental impact (lower fuels emissions) without instinctively privileging one dimension over another.

Using these three practices, he turned garbage into an opportunity.

How Entrepreneurs Find Opportunity

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Dont Confuse a Scorecard with a Scoreboard

Another great article from Harvard Business Review -

I’ve always been a big believer in using results as the differentiator between success and failure. You either achieve your goals or you don’t. Energy, creativity, and activity are all good things — but they don’t create value unless results are achieved.

Most organizations take the same stance. They put a great deal of emphasis on reporting and celebrating quarterly and yearly results — with the assumption that there is a huge upside to being perceived as a winning company. After all, positive results attract investors, raise stock prices, reinforce customers, draw talent, and more.

But only athletic events produce clear winners and losers in the short-term — and most organizations are not actively engaged in those. In fact, in many cases, the immediate “results” are in reality unknown, ambiguous, or disconnected from current performance. Here are some common examples:

  • When pharmaceutical companies announce that a new drug has been “approved,” they are actually saying that their researchers made some breakthrough discoveries as far back as fifteen years ago. By the same token, when these same companies talk about the “quality of their current research pipeline,” they have no way of knowing what will actually make it to market since over 95% of drug projects fail.
  • Financial firms that report quarterly earnings are probably jumping the gun with their results. Many of the transactions included in their announcements cannot really be judged successful for several years, or until the loans mature. Similarly, when these firms share “lead tables” that compare the numbers of transactions between institutions, the results don’t reflect the quality of the deals.
  • Manufacturing firms that gauge their success and failure on short-term sales numbers are actually reporting on their capacity to leverage research, technology, manufacturing, marketing, sales, and other functions over time — in the context of the current economy. In other words, changes in sales results may not be a sufficient measure of current performance.

This is not to say that we should abandon any of these ways of viewing organizational performance. Rather, we need to better understand how these numbers were achieved and what they are actually saying about a company’s long-term health. In other words, metrics are starting points for dialogue rather than conclusions. If we don’t treat the announced results this way, we run the risk of being fooled. That’s why we have analysts whose job it is to probe the numbers and interpret what they really mean if we don’t have the time or access.

As individual managers we do not have the luxury of personal analysts, so we have to interpret the true meaning of results ourselves. But all too many managers avoid or ignore this part of their job — either because it takes too much time, is too difficult, or will lead to uncomfortable discussions. So instead they treat scorecards like scoreboards, with black and white numbers that they think tell the whole story.

Unfortunately without dialogue, interpretation, and reflection, numbers on a scorecard often lead to a distorted picture of performance — with too much, too little, or misplaced credit given for achievement. For example, in a financial services firm that was trying to introduce new products, the numbers alone made it look as though the sales team was floundering. But by probing deeper, the senior business leader realized that some of the products were poorly designed, that systems did not adequately support the new offerings, and that the sales team was unclear about priorities and preferred targets. She also found that some sales teams were able to hit their numbers despite these factors. Without trying to understand the nuances behind the results, the senior leader might have put all the responsibility for improvement on the sales function, which would have reinforced the lack of collaboration and perhaps made the situation worse.

Obviously, not every result requires deep analysis and interpretation. But without at least some amount of dialogue, we run the risk of misunderstanding what is really going on.

What’s your experience with having a robust dialogue about the nuances of results?

Don’t Confuse a Scorecard with a Scoreboard

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You Cant Analyze Your Way to Growth

Good stuff from Harvard Business Review -

The biggest enemy of top-line growth is analysis and its best friend is appreciation. Sure, in a small minority of companies and industries, like the smartphone business these days, there is explosive growth, and if an analysis is done of past trends, it shows lots of opportunity for top-line growth.

But in the majority of businesses, if the available data are crunched, it shows a slowly growing industry — one growing with GDP or population. That generally convinces the company in question that there aren’t really opportunities for top-line growth, and that in turn becomes a self-fulfilling prophecy.

The fundamental reason is that analysis of data is all about the past. Data analysis crunches the past and extrapolates it into the future. And the past does not include opportunities that exist but have not yet happened. So, analysis conspicuously excludes ways to serve customers that have not been tried or imagined or ways to turn non-customers into customers.

Thus the more we rely on data analysis, the more it will tell a dour story on top-line growth — and not give particularly useful insights. The data analysis of P&G’s home care business — hard surface cleaners, dish and dishwater detergents — would have indicated that there weren’t many opportunities for top-line growth circa 2000. These categories were growing at something between population growth and GDP growth, clearly candidates for harvesting or maybe sale.

If instead, the core tool is not analysis but rather appreciation —deep appreciation of the consumer’s life — what makes it hard or easy; what makes her (in this category) happy or sad — there is the opportunity to imagine possibilities that do not exist.

For instance, suppose your consumers have to clean floors. It’s easy enough to appreciate that mopping a floor is a fairly miserable task. Think about what it involves: getting out and filling a bucket, dragging the bucket around and repeatedly jamming the mop in and out of it, and then dumping out and cleaning the bucket. If you appreciate your floor-cleaning customers, you’ll be looking to help them avoid having to go through this experience every time they have to clean a floor — because not every floor will need such a heavy-duty approach. It was out of this appreciation-triggered insight that the electrostatic Swiffer anti-mop was born and produced massive top-line growth, approaching $1 billion in sales in a decade.

A similar thing happened with Febreze. There was a slowly growing market for air fresheners that masked odors emanating from hard-to-clean household items like furniture, drapes, and carpets. However, odor masking was hardly an optimal solution for the consumer. Appreciation of the consumer’s feelings would have revealed that genuine odor elimination was the underlying desire.

Out of that appreciation came Febreze, which captures and eliminates the odor molecules in fabrics. Not surprisingly, it also produced spectacular top-line growth where the conventional analysis showed that there wasn’t much to be had.

Organizationally and behaviorally, analysis and appreciation are two very different things. Analysis is distant, done in office towers far from the consumer. It requires lots of quantitative proficiency but very little experience in the business in question. It depends on data-mining: finding data sources to crunch, often from data suppliers to the industry. Appreciation is intimate, done in close proximity to the consumer. It requires qualitative proficiency and deeper experience in the business. It requires the manufacture of unique data, rather than the use of data that already exists.

In my experience, most organizations have more of the former capabilities and behaviors than of the latter and hence most struggle with top-line growth. The biggest issue isn’t the absence of top-line growth opportunities but rather the lack of belief that they exist. And that is driven by the dominance of analysis over appreciation.

You Can’t Analyze Your Way to Growth

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Marketing During a Recession – Should we? At what rate?

During these days of tight economic times a lot of us that are decision-makers for our respective companies are thinking hard about the details of our marketing initiatives. How should we market? Should we market? How should we spend? And at what rate should we spend?

JASE published an article on our company blog a few months ago that references thoughts from the Harvard Business Review. It’s worth the read.

Harvard Business Review – How to Market during a Recession

JASE Marketing blog