Marketing continues to be a one-sided affair. Brands have massive budgets, highly-trained professionals, numerous support services and agencies, mountains of data and insight, arsenals of technologies to target and communicate with people.

What do people have? Ad blockers, DVR’s, unsubscribe buttons and, most importantly, indifference. As Soren Kierkegaard said: “At the bottom of enmity between strangers lies indifference.” While Social Media shows some signs of turning this one-sided relationship into more of a partnership, the fact is: All the resources are still with brands. And it’s hard for anyone of us to imagine a future where these roles we all are used to playing, will change. When the seller-centric paradigm transforms into a buyer-centric reality.

Until today.

Mydex launched today the personal data store service. It’s a first step in the marketing revolution that will turn people into owners and managers of their own data. It is a very small test but it’s an important piece of the puzzle to change the way marketing information flows. Personal Data Stores empower individuals to become owner and managers of their data, allowing for a real partnership between buyers and sellers. They will help restoring the balance between two parties.

Marketers might find that scary since it threatens their power of influence. I would argue this will transform passive consumers into more active producers, both helping the individual to achieve his goals. And help brands become more efficient in their product development, branding, marketing, advertising – you name it. And that’s just a small part of the transformation. Once individuals will take ownership of their data, major industries will be reinvented: Health Care, Education, Politics.

Please read Mydex’ White Paper for a more detailed look at Personal Data Stores: “The case for personal information empowerment – The rise of the personal data store”

Congrats to the folks at Mydex.

Throughout the World Cup, I received many emails and tweets congratulating “my team”, Deutschland, for their great tournament and playing really exciting soccer (Fussball, as I call it.). Reading German newspapers and magazines, I experienced a lot of self-congratulation for the new, exciting German soccer game, how suddenly the world loves Germans and the multi-cultural faces that played on the team. Oh yes, and 3rd place was lovely.

Enough already.

We’re talking German soccer here. We’re supposed to win each time. Sure, we won’t, but any tournament we don’t win is a loss. Period. Did you ever see the Lakers or Yankees fans celebrate a second place? Or a good loss in the Division Final? Of course not. On paper, Germany’s performance in the last 3 tournaments looks outstanding: Third place World Cup 2006, 2nd place Euro 2008 and 3rd place World Cup 2010. Great. But, where’s the trophy?

Match it up with all that nonsense talk when the US tied England in a group game and people started to celebrate it as a victory. That kind of talk will get you nowhere. Very, very quickly.

Winning organizations are like “A” students: They expect to get an “A” each time they perform. Whenever they get a “B” or worse, they’re disappointed and work hard to get back to the “A” level. Mediocre organizations are like “C” students: They get a “B-” and high-five each person they encounter. They are still not as good as the slip-up of the “A” organization but they’re ecstatic because for once they’re out of the “C” cellar. Just to slip back into it again very, very soon.

We all worked with “A” people before. They might fail, maybe even often, but they always give everything they have. They believe something can be done when others think it can’t. They can solve problems others consider unsolvable. They don’t believe in expectation of others, they have their own expectations. And, we all worked with “C” people. They might talk a big game but their actual work is sloppy. Mistakes. Not failures. Laziness. No high standards. No inner push.

If your organization does things that everyone arounds you thinks you can achieve, then your organization is just a “B” student, not pushing everyone hard enough. I’m not talking about pipe dreams, I’m talking about Big, Hairy, Audacious Goals. Rationally, you will achieve your goals when you meet certain metrics. But, that’s not fulfilling, organizational achievement. Real accomplishment and achievement comes from pushing everyone, including yourself, to the limit. Beyond the place where everybody else thinks you could ever go. As a “C” organization, you need to push for constant “A” scores. It might take a while,  a lot of “B” scores, but as long you keep up an air of excellence, deeply rooted in your organization, you are on the way to become an “A” organization.

An interesting thing happens on the way: The people that didn’t believe in you and your organization in the beginning, will be starting to believe in you. And these people will do everything they can to make you even more successful. Nothing in your balance sheet might have changed, you still employ the same people, deal with the same stakeholders – a mindset of excellence will change everything.

My kid’s Karate teacher said to the class a few days ago: ” When you want to tear a piece of paper with your hand, you don’t aim for the paper. You don’t aim for a small space behind the paper. You aim for a place 2,000 miles beyond the paper.”

Shoot for the stars.

Development is not something that is done to an individual or group; it is something they do to themselves. It is an increase in the ability and desire to satisfy one’s needs and legitimate desires and those of others. It is a matter of learning, not earning. No one can learn for another, but one can encourage and facilitate the learning of another. Development is not a matter of how much one has, but how much one can do with whatever one has and what resources can create out of what is available.

Organizational development requires leadership, which is primarily an aesthetic activity. One who leads development must inspire pursuit of a vision in whose production the leader had a hand. A vision is a picture of a state more desirable than the one that the organization currently is in. Leadership must also faciliate development of the strategy, tactics, and operations by whose means the vision can be pursued. Since the vision is often one of an ideal that can never be attained, though it may be approached continuously, leadership must see to it that the pursuit itself is satisfying, that it is fun as well as meaningful and valuable. Effective pursuit of an ideal requires the leader to extract the best possible effort from those who follow. In a corporation, this requires providing nothing less than a very high quality of work life.

Part of leadership is an appropriate ethical-moral judgement process. The ideal process would encourage leaders to make decisions only by consensus of all stakeholders. And the final decision should never deprive another of the ability or opportunity to develop unless the one affected by the decision would otherwise deprive others of this ability or opportunity.

However, the number of stakeholders of some corporate decisions runs into the millions, and there is just no way of involving all of them in every decision that affects them. For that reason, multi-national enterprises have to use representatives of various stakeholder groups. In a perfect world, any organization would designate individuals who will be responsible for identifying and evaluating the effects, if any, of current decisions on future generations’ choices and the ability and desire to make them.

A vision that involves a radical change in the way an organization is conceptualized is a transforming vision. One who leads the pursuit of such a vision is a transformational leader. Transformations are primarily qualitative, rather than quantitative, and are large discontinuities, not merely reform or incremental improvements.

The transformation to systemic thinking has brought with it a growing awareness of the fact that the effectiveness with which any of our daily activities (work, play, learning, inspiration) can be carried out depends on the extent to which they are integrated. Making it very apparent that a transformational leader must be able to integrate the various aspects of life in order to effectively pursue development. The transformational leader is one who can create an organization that reunifies life, who integrates work, play, learning, and inspiration.

The transformation of an enterprise from one conceptualized as an animate system to a social system is only one kind of transformation that is possible. However, in our current environment – one characterized by an increasing rate of change; increasing complexity; and an increasing rate of production of understanding, knowledge, and information – there is no other type of transformation that can bring about the necessary focus on employees, customers, and the other corporate stakeholders. A corporation that continues to focus more on shareholder value and less on stakeholders will ultimately fail.

In our last installment of the “Transform your business” series, we’ll talk about Human Business Design.

Previous installations can be found here: Part 1, Part 2, Part 3, Part 4, Part 5, Part 6 and Part 7, Part 8, Part 9, Part 10, Part 11.

Image: Courtesy of 3.media.tumblr

Most organizations refer to asset planning as resource planning. We don’t like the term, especially when it comes to humans. Human beings are assets, not resources. The essential difference between assets and resources is that resources have no value outside the business process they are used in, whereas assets have an intrinsic and potential value. Managed as resources people do what resources do: they become depleted or absent – they burn out or move to another company. Managed as assets they flourish, growing in value for themselves and from there – engaged in heart and soul – add value to the companies (and all other communities) they are part of.

What companies need more than anything in these challenging times are people who are for and are involved in their work with their hearts and souls. That level of involvement and caring is therefore the core issue and determiner of sustainable corporate success in today’s market environment. People engaged with their heart and soul are the most valuable asset any company can have.

Many companies are aware of this and try integrating “human-oriented thinking” into their corporate strategy; some even realize that appreciating people as the asset they are goes much further than being “nice” to them as a motivational incentive; it adheres to a scientific understanding of businesses as complex adaptive systems.

Types of Assets

In asset planning, these types of assets are usually involved:

1. Money
2. Capital Goods
3. People
4. Consumables
5. Data, Information, Knowledge, Wisdom

It’s clear that the required amount and the available amount of each type of asset will not be equal. Because the requirements and supply of any asset are seldom, if ever, in perfect balance, asset planning usually creates the requirement for continuous planning.

Financial Planning

Making a profit was once thought to be the only legitimate objective of an enterprise. But times have changed. More and more enterprise consider profit now as a basic pillar, not the ultimate goal. For that reason, enterprises need to determine the financial conditions required to survive and implement the new plan. This requires financial modeling, measuring financial performance measures under a variety of assumed conditions and decisions to use assets.

Capital Expenditures

Given its planned pursuit of an approximation to its pie in the sky design, what new facilities and equipment will a company need? Usually, the needs are treated individually and justification to deploy assets based on estimated returns on the investment. Enterprises need to consider the fact that some investments might look poorly on a plan when considered individually but contribute to the bottom line when integrated into the overall system.

People as assets

People are e the most valuable asset a company can have. Nevertheless, they are generally used less efficiently than any other type of asset. The waste of employees’ time and competence is huge. The quality and competence of employees had increased significantly during the last decades. However, the way people are being managed and the organization of human capital has not. More often than not, humans are seen as extensions or replacements of machines.

The trend of increasing the number of people as much as possible (no matter the output required) when times are good and downsizing (no matter the output) in bad times shows how unsophisticated our approach to human asset planning is. In later parts we will offer a solution to that problem by implementing a market economy within the enterprise.

Consumables

Each organization consumes assets it uses: material, energy, services – just to name a few. These assets are supplied by either an internal or external source; most enterprises focus on supplying itself with any consumable asset to avoid interdependency. However, in this networked and globalized economy, it has become almost impossible for many companies to obtain and retain the competencies required to provide many of these assets in an economic manner, threatening their ability to compete.

Let’s just look at the media agency world: When enterprises bring advertising in-house, they often have problems attracting superior talent. As a talent, would you want to work for a huge media agency with good opportunities to advance, or would you work for an enterprise with no chances of real advancement since the rest of the enterprise is devoted to anything else but media? Specialized enterprises are able to provide specific assets at a lower cost and higher quality than most in-house divisions.

However, the relationship between suppliers and enterprises are often negotiated so as to guarantee behavior not supporting (or even fighting against) the interest of the enterprise. Let’s continue with the example of the media agency: If the enterprise reimburses the agency based on a percentage of company’s media spend, the agency will do anything to increase the media budget. No matter the effect, no matter the outcome. A whole industry of research institutes and consumer behavior studies survive because agencies need data to convince enterprises to spend more money on media. Has there ever been a real study that shows the effect of advertising on sales? In many cases, agencies are better selling to enterprises than to sell the product of the enterprise to customers. As a result, agencies become lobbyists for media, not for their customers they’re supposed to sell to. To break this vicious cycle, agencies should be compensated for increases in sales without increasing media spend and for decrease in media spend without loss of sales.

This would serve customers much better. Currently, media agencies increase their profit often at a cost to customers. (Time, Annoyance, etc.) Once enterprises preach the gospel of media spend cost reduction by sharing the benefits with all suppliers, a paradigm shift will occur.

Information

There’s a frequent misconception that implementing a KMS (Knowledge Management System) can provide all the support decision makers require. Research has shown that most KMS’ miss; they fail to fulfill the promises that were used to justify their development. For that reason, we need new assumptions about information.

Managers need less irrelevant information

All of us experience it each and every day: Information overload. Email bankruptcy. Social Media fatigue. Once we have to deal with too much information, we tend to use less information to make decisions. And we have a natural drive to know more and more about less and less. This might be the perfect approach for boutique firms but large corporations need less specialists and more generalists – T-Shaped people. For them to be successful, enterprises need KMS’ to help them filter out irrelevant information and condense relevant information appropriately.

Managers shouldn’t be burdened with knowing what information they need

The complexity of systems requires executives to manage effectively without understanding the system well. A system that can be comprehended fully doesn’t need a good manager. In return, a manager that requires each and every detail is scared and will play it safe, not advancing the system appropriately. Executives earn their pay when they possess the skill to make a decision based on enough facts not on all facts.

The information that managers need is whatever information enables them to do better with it than without it.

A Knowledge Management System shouldn’t be static, it needs to be embedded within the organization and management system as an infinite learning loop, capable of constant improvement. This  will enable executives to learn what they need or they will be stuck in the “always-asking-for-more-information-loop”.

Less communication between certain stakeholders is better

The Information Age has one gospel: More information is better. When all stakeholders are aware of what the other stakeholders are doing, this should enable stakeholders to coordinate their activities better and improve performance, correct?

No.

Various stakeholders often have different measures of performance and those are often in conflict with the various divisions. Increased communication between stakeholders might actually hurt the overall performance of the enterprise. Before opening up the flood gates of communication, the enterprise, it structure and performance measures need to be aligned with all stakeholders. Once implemented, each stakeholder communication should be evaluated and communication levels adjusted accordingly.

Managers have to understand their KMS

A Knowledge Management System has one objective: to support the enterprise and improve performance. Executives need to control the system, they need to ensure not to be controlled by the system. This requires a deep understanding of the system, its capabilities and limitations.

In summary, asset planning’s objective is to deliver useful inputs to decision making and the ability to identify and learn from mistakes to ensure improvements of pie in the sky and gap planning. This will help implementing a system that improves decision making and allows for rapid learning and adaption.

Let’s talk about that in the next part.

Previous installments can be found here: Part 1, Part 2, Part 3, Part 4, Part 5 and Part 6.