Sometimes the Details Matter

October 10, 2011

Professional coaching of all sorts seems to be having its moment, both for individuals and within the business world.  A recent article in the October 3, 2011 issue of The New Yorker by Atul Gawande made a compelling case for coaching.  Although Gawande, who is a surgeon in Boston and a faculty member of Harvard’s Medical School, is no slouch, he voluntarily subjected himself to the vulnerability of being coached by a more senior physician with favorable results.  

The article contains many good insights on the do’s and don’t’s of coaching.  Among them is this anecdote involving John Wooden, UCLA’s celebrated basketball coach:

” The U.C.L.A. basketball coach John Wooden, at the first squad meeting each season, even had his players practice putting their socks on.  He demonstrated just how to do it:  he carefully rolled each sock over his toes, up his foot, around the heel, and pulled it up snug, then went back to his toes and smoothed out the material along the sock’s length, making sure there were no wrinkles or creases.  He had two purposes in doing this.  First, wrinkles cause blisters.  Blisters cost games.  Second, he wanted his players to learn how crucial seemingly trivial details could be.  “Details create success” was the creed of a coach who won ten N.C.A.A. men’s basketball championships.”

When to Throw in the Towel on a Business Venture

June 26, 2011

Within the past month, I noticed a couple of articles about businesses voluntarily choosing to call it quits that are worth highlighting.  Businesses go bust all the time and in many cases either quietly wind down and dissolve because they weren’t profitable or get run through the wringer of bankruptcy process to sort through who will salvage the parts worth saving.  The situations with Bling Nation and Google Health are interesting and contrasting variations on the usual tale because these undertakings didn’t truly flame out.

Google’s decision with its Google Health is the more traditional of these two stories.  As reported yesterday in the NY Times, the effort to gain traction with consumers adopting electronic health records was fraught with challenges.  This was best summed up by an analyst at IDC Health Insights by her observation that “Personal health records have been a technology in search of a market.”   So, sometimes the lesson that even major enterprises learn is that even with a boatload of financial, technology and people resources to throw at a business venture success is not assured and  sometimes the best thing to do is just accept this and move on.

Bling Nation’s decision is more interesting because it’s less typical.  The company is (was?) an early stage mobile payments services provider that had raised a significant amount of capital (over $33 million) to execute its business plan and had gained a significant following among both target consumers and community banks.  Blig Nation was among the first to deploy near field communications (NFC) in connection with mobile payments.  The American Banker on June 8 ran an in-depth story about the company and its Achilles heel, which seems to have been tying use of their widely praised payments solution with a mobile marketing solution called FanConnect, as to which both banks and consumers balked because it was seen as an unwelcome obstacle to the desired mobile payments solution the banks had already been using with success.  Result: banks started dropping the service causing an abrupt comeuppance of sorts for Bling Nation.

So, in a gutsy move that may have been dictated as much by realism and necessity as anything, Bling Nation chose to press the reset button by temporarily suspending its service and regroup.  Matthew Murphy, the company’s General Manager noted, “We found it easier to pause and fix [our business model] than try to tweak and market.”   While there are frequently second chances in business and, to its advantage, Bling Nation has substantial capital in reserve for a “relaunch” if that’s what it decides to do, it will be interesting to see whether its lost footing can be regained. 

Both Google and Bling Nation are also notable examples of the adage that innovation often requires not being averse to the risk of  failure and the key is to learn from the missteps and then go in a different direction (as with Google Health) or recalibrate (as with Bling Nation).

More Alphabet Soup for Internal Controls: SSAE 16, SOC 1, SOC 2 and SOC 3

June 9, 2011

Starting June 15, 2011, audits of the internal controls of a service provider for several key service areas will be based on a new audit standard, SSAE 16, promulgated by the American Institute of Certified Public Accountants (AICPA) rather than the currently prevailing SAS 70 standard, which was originally introduced in 1992.  Along with this new standard are new associated report standards — Service Organization Control (SOC) Reports, of which there are three:  SOC1, SOC 2 and SOC3.  


The increased attention in recent years given to an organization’s internal controls has somewhat naturally extended to the internal controls of service providers and support partners.  This is based partly on the simple notion that any given control environment is only as strong as its weakest link, so validation of controls implemented by significant service providers makes sense.  It’s long been customary where service provider controls are sought to be confirmed that a SAS 70 report would be requested from the service provider.  SAS 70 is principally a standard that allows an auditor to confirm that its clients’ service providers have adequate controls in place to the extent those controls have an impact on client financial statements.  While SAS 70 is not truly focused on specific controls or whether controls can be said to have been effective over a stated period, in the absence of anything more tailored the SAS 70 report was made to do double duty as a rough proxy for service provider security controls.  SSAE 16 and the new SOC reports were specifically intended to address this shortcoming. Read the rest of this entry »

Insights from The Corner Office

April 16, 2011

As indicated by a prior Tech Razor post, I’m a fan of the weekly “Corner Office” column, which appears every Sunday in the Business section of the NY Times.  Through a very lean interview format that focuses on his subjects’ approach to leadership, management and hiring, Adam Bryant, who conducts the interviews and edits the column, is able to distill some truly insightful musings from top executives across a wide range of industries. 

Bryant has now compiled many of these interviews into a book,  The Corner Office: Indispensable and Unexpected Lessons from CEOs on How to Lead and Succeed.  While Bryant’s subjects include business luminaries such as Steve Ballmer of Microsoft, Carol Bartz of Yahoo and Alan Mulally of Ford, there are as many gems of leadership wisdom offered up by less well-known leaders such as Judith Jamison, Artistic Director of Alvin Ailey American Dance Theater and Wendy Kopp, the founder and CEO of Teach for America.  This collection is well worth the investment of time to pore through it.

In the following short video, Bryant discusses his observation that five key attributes set these top performing business leaders apart from others.

Being Bad With Technology

February 6, 2011

The recent skewering of Kenneth Cole’s CEO by the “twittersphere” for his bad attempt at humor by connecting this past week’s mass protests in Egypt to the Kenneth Cole brand provides one of those object lessons that I’m sure make marketing people cringe (although I’ve heard cynical PR folks observe that even this type of publicity is priceless in a good way) and that we all get with the benefit of 20/20 hindsight.  There have been other notable inappropriate uses of new media by businesses and their executives, but considering the relative age of such technologies, I’d suggest that some of the authors of these faux pas probably deserve to be cut some slack.  Whether such leniency will be in order say 10 years from now  — when the contours of propriety with this stuff will have been better worked out — is another story.

However, the Kenneth Cole incident brought to mind the case of Vitaly Borker and his website, which is a truly sordid episode of the misuse of online technology for marketing purposes (of a sort) that unfolded a couple of months ago.  The DecorMyEyes situation seems to have received far less attention, at least based on the instances where I’ve mentioned it to others and realized they had not heard of it, so I thought I’d provide a brief overview. 

In a truly terrific piece of investigative reporting by NY Times writer David Segal, who was working on a story about why Brooklyn-based DecorMyEyes had generated such a substantial number of consumer complaints, Borker revealed in an extensive and audacious interview with Segal that part of the business model for this web-based business was to antagonize his customers to the point that they would write negative, even scathing reviews.  Sounds weird, right?  Except that Borker had somehow stumbled upon the realization that any publicity, especially bad publicity such as persistent customer criticism, jacked up his rankings in Google searches because, according to him, Google’s algorithm did not factor out negative feedback.   Here’s an excerpt from Segal’s piece:

Today, when reading the dozens of comments about DecorMyEyes, it is hard to decide which one conveys the most outrage. It is easy, though, to choose the most outrageous. It was written by Mr. Russo/Bolds/Borker himself.

“Hello, My name is Stanley with,” the post began. “I just wanted to let you guys know that the more replies you people post, the more business and the more hits and sales I get. My goal is NEGATIVE advertisement.”

It’s all part of a sales strategy, he said. Online chatter about DecorMyEyes, even furious online chatter, pushed the site higher in Google search results, which led to greater sales. He closed with a sardonic expression of gratitude: “I never had the amount of traffic I have now since my 1st complaint. I am in heaven.”

Perverse, for sure.  Perhaps if he had stayed below the radar screen with his unethical gamesmanship, Borker would today still be harassing consumers and enjoying his laughter all the way to the bank.  But the arrogance that he flaunted in his NY Times interview caught the attention of local and federal law enforcement and resulted in a major comeuppance when he was arrested by federal postal authorities several days after the interview on charges of mail fraud, making threats to customers and fraudulent business conduct. 

The entire original article by Segal makes for fascinating reading, as well as the ensuing comments over the following weeks from many readers and Google about its search algorithm and related changes.  While several organizations came across as less than diligent in their customer safeguards, the online retailer Amazon fares well in the piece.  Lots of lessons here.  For consumers, do your research before you buy online.  More generally, if you base your business strategy on a faulty premise, such as the unethical use of a technology platform, expect that the dumb behavior will eventually catch up with you, and that arrogance can only sustain itself so long.

Object Lessons in Business Failures

January 31, 2011

Catching up on some posts here, a piece from an early January issue of the NY Times (“How Six Companies Failed to Survive 2010,” by Eileen Zimmerman, NY Times, Jan. 5, 2011)  in which six business are profiled that failed in 2010 is notable for the to-the-point candor exhibited by the subject entrepreneurs.   Hearing explanations for why their businesses failed directly from the people that ran them is akin to the clarity that comes from viewing a picture in place of the proverbial thousand words.   The businesses range from a web-based personal finance portal to a gourmet baby food company and their problems range from inadequate financing to unexpectedly intense competition.   Very useful reading on pitfalls to avoid. 

A useful adjunct to the above piece is the related NY Times “You’re The Boss” blog post by Jay Goltz from the same date entitled “Top 10 Reasons Small Businesses Fail.”  Goltz’s list applies equally to larger businesses and includes the “math not working”, owners who can’t get out of their way, and out of control growth.  The reader comments are also good stuff.

Management Lessons c/o Steve Jobs and Paul Maritz

October 4, 2010

This Sunday’s NY Times had a couple of columns in its Business section that caught my attention on management issues.  One of the Sunday paper’s regular features is the “Corner Office” in which business executives reflect on leadership issues.  In this past weekend’s column, Adam Bryant interviewed Paul Maritz of VMware.  Among Maritz’s observations are the following on how to get the best out of others:

It’s very hard to talk about these things without becoming trite or corny, but the best leaders are those who get the best out of other people.I’ve learned that you only really get the best out of other people when you do things in a positive way. There are negative styles of leadership, where you do things by critiquing and criticizing and terrifying other people. But in the final analysis, it doesn’t get the best out of people and it doesn’t breed loyalty. Because no matter how much we think we’ve got things figured out, we haven’t got things figured out. Inevitably, we’re going to go down blind alleys. We’re going to run into problems. We’re going to make mistakes. And when that happens, you have to ask people to help you and to overlook the fact that you’ve messed something up.

Great leaders, in my view, are those who have built up that reservoir of loyalty, so that when the time comes to say to folks, “We have to change direction,” people are willing to make an extraordinary effort. If you’re the kind of leader who cuts people down and humiliates them, you leave scars on people that can eventually come back to haunt you.

Good stuff. 

Across the aisle, so to speak, was an article by Randall Stross about the lessons learned by Steve Jobs during his time in the “wilderness”, the dozen or so years after 1985 when he was forced from operational involvement in Apple.  He took advantage of that time to learn some hard lessons at NeXT computer, which, while it ultimately failed, is credited with providing Jobs with the grounded perspective he needed to successfully return to Apple and lead it to yet greater things.  The idea of a person needing to go off into the wilderness to learn important life lessons is one that is seen across numerous cultures outside the business context.  Another reason why business’ most valuable training ground is often found at the altar of business “failure”.