GE

  • January 14, 2016
  • 500px-General_Electric_logo_svgGeneral Electric Corporation’s announcement that it was moving its headquarters to Boston is big news for Boston and the region. Long known as a center for technology innovation in computers, health and life sciences, communications (Internet got going here as well as elsewhere, that’s the nature of a network) oh, and robotics, with world-class research institutions like Harvard and MIT, the decision has given Boston a new life reversing a trend of corporate departures many through acquisition. Dell is buying EMC, Digital, DG, and the other mini-computer companies are gone.

    The Boston area last bloomed in the 1970’s and 1980’s as the center of the mini-computer revolution but all of these companies are gone as is the mini-computer but the infrastructure of technology innovation goes back at least to Alexander Graham Bell and the telephone, Samuel Morse an inventor of the telegraph and Morse code (a decent painter too) and many others. The first surgery with ether happened here too.

    GE is coming to Boston because it wants to be a major player in the Internet of Things or what this New York Times article referred to as the industrial Internet. Good for them. Having GE here will re-energize the local economy and tap into some very bright minds, not just in engineering but in many other fields like medicine. As is typical, I’d expect a large community of spin-off companies to emerge and to need venture funding which will tap into another one of the area’s natural strengths. I also expect many Silicon Valley companies to start or beef up their presences here just because.

    GE’s presence will also change Boston in unpredictable ways. Will the industrial Internet overtake biotech? Will the local software industry thrive or will it be supplanted by another wave of hardware builders? Where will people live and what will the influx of more talent and capital do to real estate prices? Will Cambridge, a hip enclave in the metro region come to resemble Palo Alto more? Who knows?

    Last summer the voters put their collective foot down over hosting an upcoming summer Olympics. It was mostly due to the high projected costs and the IOC’s demand that the city and state backstop any cost overruns. When it was over Boston was a bit bruised and the Boston Globe putting what seemed like a brave face on the disaster at the time said, that’s Okay, we’re Boston, we cure cancer, we don’t host track meets. At the time it was cold comfort, today not so much.

    Published: 3 years ago


    200px-General_Electric_logo.svgIn a sure sign of the times, Google announced its new holding company, Alphabet, today. Alphabet will now be parent of the search business as well as all of the other businesses like drones, android, self-driving cars, wearables, and so much more. The switch helps Google become more transparent for Wall Street while setting up the company as a first class innovation conglomerate. An article in the New York Times makes the point (several times) that by setting up Alphabet, Google is emulating General Electric or even Berkshire Hathaway, Warren Buffet’s outfit that is into everything from tighty whities (Fruit of the Loom) to manufacturing, retail companies and a lot more.

    Emulating either company is not a bad way to go. Since its founding in 1892 by Thomas Edison, GE has been a powerhouse of innovation in such far flung areas as medicine and healthcare, locomotives, jet engines, and a host of smaller goods that influence the lives of nearly all Americans. What GE has been (and this in no way writes off GE as a future innovator) in all of these areas, Alphabet has a chance to be in new fields during the century ahead.

    Unlike Microsoft, which has remained a single entity, Alphabet will spin-up and spin-off wholly owned entities with a singular purpose that enables Google’s founders to engage in their interests in creating new companies, products, and business models while more or less insulating the cash cow from the vicissitudes of a large and possibly chaotic single company. The single company model sets up all kinds of political rivalries for resources and it saps the strength of even the best leaders.

    What links GE, Alphabet, Berkshire Hathaway and many others is a Blue Ocean strategy. This approach enables leaders to be bold speculators about the future and the make products and services that fit their visions. Since many or even most bets on the future fall short, there’s a high amount of risk associated with attempting to sail on the blue sea, but when an idea works it is often game changing and paradigm building. If you think about it, Google Glass and self-driving cars define the spectrum.

    All this brings to mind Salesforce.com, another company that I have said many times has a blue ocean orientation. Salesforce is tiny compared to GE or Berkshire Hathaway but those companies were small once too. So far, Salesforce has stuck relatively to its knitting building software for business. But if you look at what it is involved in from its verticals to its partners to wearables to its platform-based approach, you can see the potential makings of another GE or Alphabet, though one that is solidly focused on software, at least for the time being.

    The rise of Alphabet and the emerging prevalence of blue ocean thinking suggests to me that we are at a transition point. We’re shifting from an economic paradigm focused on information and ramping up a new one that applies digital technology to many more challenges than how to rapidly store and retrieve data.

    Humanity faces a long list of challenges today that will benefit from a more aggressive and engineering based approach to problem solving. Engineering is not a panacea but it is amazing how many challenges can be addressed when we start with engineering based approaches. With GE as a model, it will be interesting to see what Alphabet does next.

    Published: 3 years ago


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    Hillary Clinton speaking with Phil Fernandez, CEO, Marketo

    The overall impression I got was that modern, statistical and analytic marketing is still in its early phase though few people I know need to be convinced about its usefulness and efficacy.  You could see evidence for this belief in the products and product introductions, the breakouts, and in the speeches.

    First the speeches.  In addition to CEO Phil Fernandez’s keynotes there were appearances by Democratic presidential front-runner, Hillary Clinton and GE’s powerhouse CMO, Beth Comstock.  Each woman’s appeal to the largely female audience was obvious.  They are role models for many and an inspiration for any woman wanting to climb the greased rope of corporate success.  Each spoke about the challenges of being a woman in business today but I thought Comstock came closest to the mark when in the context of marketing she said that sometimes you simply need to give yourself agency to try something.  That’s an avenue not as easily exploited in politics where as Clinton pointed out consensus building is important and sadly absent today.

    The theme of the event was innovation and while Clinton, who spoke on Day 1, is no technology expert and not a marketing professional, her vast practical experience in modernizing the State Department by embracing the Internet and social media and her knowledge of how to sell an idea, which was honed in decades in the political arena, provided a great foundation for discussing innovation in a broader, national context.  Clinton’s message concentrating on the truth that we are all people and that we need to coexist was not lost on the men in the audience either.

    Comstock spoke on the second day and gave a more focused discourse on what it means to be a modern marketer in one of the largest, most innovative, and geekiest corporations on the planet.  Her message was that marketing has to take the lead in inventing itself, to find markets and opportunities for innovation in order to take its rightful seat at the boardroom table.  She told of instances in GE’s diverse portfolio from jet engines, to locomotives, power systems, and healthcare where marketing found product opportunities and developed markets for them.  The keys to success — and there were several — included bringing business ideas where marketing can quantify results and not simply existing to produce content, a message well in line with Marketo’s ideas about marketing.

    At the keynote level, Fernandez allowed himself a brief moment on stage to take in the company’s success symbolized by the throng in the hall.  The company introduced new and improved products for calendaring, SEO optimization, and personalization, all of which are in demand as building blocks of modern marketing.  Fernandez also hammered on the continuing need for innovation in all things marketing related as companies continue to face great challenges driven by the pace of business and the ferocity of competition.

    When it got to the breakouts, and I didn’t go to all of them, the vibe seemed to be how to help marketers to do more than adopt the basics and to exploit the breadth and depth of marketing automation.  This is no surprise for any breakout session but for a still new market that is past its early doubters but still gaining altitude in the executive suite, the sessions offered practical advice for things tangential to marketing such as how to work better with sales.  There is a great thirst for this kind of knowledge and knowhow among marketers.

    Especially illuminating to me was the amount of discussion about marketing’s interface with sales and for me this was troubling, not for marketing but for sales.  Of all the disciplines in CRM today, sales appears to me to be the one that has changed least over time and that’s not good.  Sales is the practice area least affected by CRM, where people are still allowed to fly by the seat of their collective pants.

    I say this not to be provocative but to bring together several threads.  First, the urban myth that sales force automation does not work refuses to die, second, according to CSO Insights, half of all organizations surveyed still don’t have a recognizable and implemented sales process.  Third, and perhaps most troubling to me, too often the discussion between marketers has turned to questions of how can we effectively work around sales if it insists on its recalcitrant ways?  Too much of marketing automation’s effort seems to be in devising ways to capture customer data that provides the feedback that sales ought to be giving.  At least that’s what I saw.

    My concern for sales is that it will remain stuck in its rut too long and that market forces like the automation provided by ecommerce and subscription sites augmented by the information flow provided by marketing, will serve to make selling and its practitioners redundant.  As markets and categories mature a certain amount of retail-ization of the sales function is inevitable.  However, sales people who are still avoiding formalized processes and technology are making the inevitable too easy.

    The sales function was not on trial at the Marketo event but as an analyst I routinely look at what is and wonder how it will evolve and my conclusion left me wondering about the future of selling.

     

    Published: 4 years ago


    moonrise-over-manhattan-island-new-york-08Salesforce came to New York this week for its annual winter meeting with customers intent on testing new ideas and capturing customer input.  The event was held at the Waldorf Astoria for a relatively small group (under one thousand) rather than at the Javitz Center, which can accommodate the maintenance facilities for a squadron of F-18’s.  Intimacy, it was hoped, would drive better discussion.

    Salesforce has been beating the Social CRM drum pretty hard for the last two years and right on schedule Chairman and CEO Marc Benioff has decided to reshuffle the deck.  On Tuesday, Benioff introduced new messaging and a new prescription for companies wanting to get social.

    Two years is about the shelf life of an idea like social for Salesforce.  You only need to do a little archaeology to recall the changes from hosted to on-demand to SaaS to cloud computing to social over the company’s short life to see what I mean.  But the company is not changing the message for fun and games, there is a serious purpose behind it.

    Social was a catch-all phrase designed to grab the attention of early adopters.  By my research, that’s been very successful.  Our data shows that executive decision makers in the enterprise and in smaller companies, all understand that social is the next big thing.  It will definitely reduce costs and boost revenues by a few points and for enterprise class companies that means real money.  That’s a message that early adopters have been comfortable with and Salesforce has some great names to prove its point such as General Electric, Toyota, Burberry’s and many others.

    Ok, so the next step for a company in Salesforce’s position is to leverage the early success by now enlisting the early majority.  That’s roughly the next level of big companies that want to adopt new technology to capture some of the cost abatement and profits signaled by the early adopters.  The only hitch is that the early majority buyer typically wants more proof.  Where the early adopter might have a C-level sponsor the early majority will have a vice president or other such title making the charge.  These people need proof because they need to convince higher ups that they should get budget for the new gizmo.

    Again, our research shows that the people in the early majority demographic are not sold yet.  They might be leaning but they also have questions, like How do I do this? What are the security and legal ramifications?  Which business processes are affected? And which ones should I start with.  Questions like this don’t get answered with social pixie dust which is why the second iteration of the social message largely does away with social as a term replacing it with the more concrete How to Become a Customer Company.

    Ok, so now we’re cooking with gas.  Becoming a more customer-centric company is an idea that’s been around in various permutations and is readily digestible by the target audience because it proffers a more concrete deliverable.  In discussing what it means to be a customer company you can’t pass go without checking in at better profits, lower costs and better customer retention.

    So I think Salesforce’s effort in New York and for the remainder of the year through Dreamforce (in December this year) has been and will continue to be fleshing out the meaning of what it means to be a customer company.

    One of the failures of most social messaging so far has been its uni-dimensional approach — buy our product and your problems are over!  Few people buy into that idea but that’s where the market is at the moment.  But to his credit, Benioff has compiled a hefty list of things you can do — with or without his products, though they do make life easier — to get to customer nirvana.  In New York, Benioff unveiled a list of eight common sense things you need to do to get to the new goal including implementing technologies that enable a company to:

    1. Listen to every customer
    2. Engage on every channel
    3. Sell as a team
    4. Service customers everywhere
    5. Create communities
    6. Connect with partners
    7. Connect your products
    8. Deliver apps everywhere

    Without going into elaborate detail on each, let me focus on number 7 which I believe will become the next big thing for social or customer companies — connecting your products.  We have heard of this by various names like the Internet of Things and that’s apt.  There is huge potential in providing a better over all customer experience by paying more attention to the things that customers buy than by bothering customers all the time with former NYC mayor Ed Koch’s uber question — How an I doing?

    If devices have relatively inexpensive sensors built into them that connect them to the Internet to send a steady stream of performance data, then vendors suddenly will have the information they need and a legitimate reason for contacting customers.  A message of, “We think your engine will fail in a month or two” might not be what you want to hear.  But if this outreach keeps you from being stranded or missing an important event then with the message your vendor may successfully transition from an adversarial position of trying to sell you something else to a real partner in a relationship.  Such is what CRM bliss is made of for all parties.

    So that’s what happened in New York this week.  New messaging, bigger ideas and pushing the ball forward to further improve the vendor-customer relationship while offering the potential to reduce business friction and boost profits.

    Published: 5 years ago


    It’s over, Dreamforce that is, and I have gotten some needed sleep on the flight back to Boston.  As I contemplate Dreamforce 2012 and its meaning I have three observations.

    First, it was what I expected it to be.  If you refer back to my post just before the show opened my expectations were more than met.  You might wonder about the timing of that post but I was under NDA and unable to say much till then.

    The company introduced a slew of products and services but aside from the formal introduction of the Marketing Cloud and things like Chatterbox, they were mostly evolutionary additions to the core products.  Instead, Marc Benioff’s keynote was long on customer stories and interviews with CEO and CIO types.  All of this was good and in line with my contention that Salesforce needed to present a case to Fortune 500 executives that the social enterprise is real and that Salesforce is the company to help them march in that direction.

    If there is one big difference between Salesforce and all other enterprise and SMB companies it is that Salesforce has the vision and the others have, so far, only come forward with product.  So I think the company was effective at showing how big companies like GE, Burberry’s, Rossignol and Virgin Group are becoming social enterprises with the help of Salesforce and that was a good thing.

    It’s worth mentioning that the GE story was more about socializing the man machine interface to give the vendor a better real time understanding of its jet engines’ performance, for instance, and thus to provide better maintenance services.  It was a nice demonstration of what’s possible in the Internet of Things, which has not yet grabbed many headlines.  At another end of the spectrum, Coke showed how it’s nifty new machines can custom blend beverages and enable a customer to develop a recipe and link it to a QR code for later use anywhere.

    Also, Virgin will be integrating Salesforce’s social customer service solutions into its customer facing systems including the onboard systems displayed on seatbacks.  That was very impressive.  And finally, Burberry’s CEO Angela Ahrendts was there for an encore to describe how the company’s new store has socialized the customer buying experience.  All very cool and very exciting if you are a C-level person wondering where new growth will come from.

    Ok, second, perhaps the company’s greatest asset hiding in plain sight is its ISV partners.  I attended the partner keynote on Day 0 and was blown away.  The meeting took place in a rather large ballroom that was full of partners who wanted to know the latest in the partner program.  What impressed me most, was how many applications (1,706 proven apps, 1.4+ million installs) and certified partners there are and what it means going forward.  But also, Salesforce has basically doubled its commitment to the partners and is driving big business with them.

    The partners are incentivized (at least some are) to sell the base product along with their wares.  Naturally, this results in great leverage for Salesforce and that will help to further accelerate growth.  You can’t underestimate this.  The partners have built many, many good applications that all demand the Force.com platform, where they go, Salesforce follows and that should be a good feeling for anyone at Salesforce.

    It looked to me like the partners are about to hockey stick their way to prominence and that will be good for Salesforce.

    Finally, I don’t know how many people actually attended.  There were 85,000 registrations as of game time on Wednesday and I don’t really care if they all came on the same day or if some percentage stayed home or others did the virtual thing.  The event was very well managed so that its size never felt like a problem.

    That said though, I think the company needs to do some planning that will break the single show into two or more big fragments.  An obvious solution might be to have a separate event for partners and technical people while offering another event for business people.  Obviously there would be overlap and that’s ok.  But I can tell you there was simply not enough time for serious meetings, just meet and greet and agree to follow up.

    I did some checking and found out that there are 3526 hotels in California and 202 in San Francisco http://bit.ly/SM3cs0 .  At some point you just run out of housing and while I suspect the powers that be are tracking this, it’s worth an out loud wonder.

    Finally (again), there’s the inside baseball. There were no picketers that I saw this year other than a man with a bullhorn trying to convert the known universe to some idea or another.  But there was still a silent battle between Benioff and Larry Ellison, Oracle’s CEO.  Oracle will take over the space next week for OpenWorld and there are already dueling registration counts.  It seems Howard Street has become a battleground of sorts.  The street separates Moscone North from Moscone South and people are forever crossing it.  In past years for OpenWorld, Oracle has rented the street from the city, closed it and erected a long tent where it serves lunch and holds parties.

    A tent is a good idea, in case the notoriously fickle San Francisco weather decides to do its thing.  In recent years, Salesforce has adopted the practice.  But instead of covering it with a tent, Salesforce has built an open-air park complete with jumbotrons, seating, picnic and live music.  You can still get lunch there but the Salesforce vibe is all open and green and bucolic even if the grass is synthetic.  So even in the street you have a metaphor of the new way to compute which is green and open vs. the old, which is housed in what is reminiscent of an army tent.

    There were a few other subtleties like that including billboard sized photos of Burberry’s CEO, Angela Ahrendts posed like the Mona Lisa smiling out on pedestrians below.  To me it all goes back to the idea of showing CEOs that Salesforce is ready to take them into the land of all things social.  What could be a better endorsement than a happily smiling CEO?

    Published: 6 years ago