lockheed martin electronics platform integration 31 january 2000
TRANSCRIPT
Lockheed Martin
ELECTRONICS PLATFORM
INTEGRATION
31 January 2000
Microsoft = R.O.W.
Microsoft > GM + Ford + Boeing + Lockheed Martin + Deere + Caterpillar + USX + Weyerhauser + Union Pacific + Kodak + Sears + Marriott + Safeway + KelloggSource: Business Week data through 5-99
Microsoft = R.O.W. (II)
Microsoft > GM + Ford + Boeing + Lockheed
Martin + Deere + Caterpillar + USX + Weyerhauser + Union Pacific + Kodak + Sears + Marriott + Safeway + Kellogg +
McDonald’s + Bank One + General Mills + American Airlines + United Airlines + + Delta Air Lines + US Airways + Quaker Oats
Source: Yastrow Marketing (through 11-23-99)
No Wiggle Room!
“Incrementalism is innovation’s worst
enemy.” Nicholas Negroponte
Just Say No …
“I don’t intend to be known as the
‘King of the Tinkerers.’ ”CEO, large financial services company
(New York, 5-99)
Forces at Work
The Destruction Imperative!
Forget > Learn
“The problem is never how to get new, innovative thoughts into your mind, but how to get old ones out.”
Dee Hock
“When asked to name just one big merger that had lived up to expectations, Leon
Cooperman, former co-chairman of Goldman Sachs’ Investment Policy
Committee, answered: ‘I’m sure there are success stories out there, but at this
moment I draw a blank.’ ”
Mark Sirower, The Synergy Trap
“Acquisitions are about buying market share. Our challenge is to create markets. There is a big difference.”
— Peter Job, CEO, Reuters
“Our ideal acquisition is a small startup that has a great technology product on the drawing board that is going to come out in six to twelve months. We buy the engineers and the next generation product. …”
John Chambers, Cisco Systems
“R & D”
Intel’s venture fund: 275 investments, $3.5B
Source: Fast Company (12-99)
EcoNets/Internet Zaibatsus
“The model is about partial acquisitions and ownerships that then form a whole. Each part has to have value separately, be able to raise capital separately, and
motivate employees separately. Corporations of the past never had that.”
Flip Filipowski, divine interVentures (Red Herring)
“The brick and mortars will die, no matter what. … So you have to take
your best employees and best businesses and spin them off and just own 40 percent of everything
that’s left. Do that and you survive.”
Flip Filipowski, divine interVentures (Red Herring)
DYB.com*
*DestroyYourBusiness.com (GE)
“It used to be that the big
ate the small. Now the fast eat the slow.”Geoff Yang, IVP/ (Institutional
Venture Partners)
[E.g.: Craig Venter/Celera Genomics]
The Gales of Creative Destruction
+29M = -44M + 73M
+4M = +4M - 0M
Brand Inside
PSF 1:Brand Org!
108 X 5vs.
8 X 1*
* 540 vs. 8
ERP, ECM, Web, Etc.
IT’S THE GIANT SUCKING SOUND
OF SLACK BEING EXTRACTED FROM
THE GLOBAL ECONOMY!
“The coefficient of friction associated with the grunge
of business is amazing!”
Michael Schrage
Cemex and FDX!
CCC Information Services!
“Assetless Company”
J.B.
RR on Sara Lee
“The most profitable businesses in the future will act as knowledge brokers, linking insights into what’s available
with insights into the customer’s individual needs
and preferences.”
“We want to be the air traffic controllers
of electrons.”Bob Nardelli,
GE Power Systems
The “&-!!+#$% in the middle”*
Jim Clark on Healtheon
* ’twixt docs, patients and providers; $250B in waste; source: Michael Lewis,
The New New Thing
“Don’t own nothin’ if you can help it. If you can, rent your shoes.”
F.G.
R&D Outsourcing/ Big Pharma
3:1+ (70% now; 5% in 5 years)
1:2+ (5% now; 20% in 5 years)
Source: IN VIVO
PSF 1.0
Professional Service Firm Conversion Kit /
Release 1.0
PSF 1.0
Department Head
to …
Managing Partner, HR [IS, etc.] Inc.
“support function” / “cost center” / “bureaucratic
drag”
or …
“Rock Stars of the ‘Age of Talent’ ”
C.I.O. to
C.E.F.R.N.S.*
*Chief Evangelist For
Really Neat Stuff
Brand Inside
PSF 2:Brand Work!
“Reward excellent failures. Punish
mediocre successes.”
Phil Daniels, Sydney exec
But Does It Matter????
“On time, on budget … who cares?”
anon. seminar participant (4/99)
Kaiser: 4.15.29
Liberty Ship
2 years
240 days
9 hours
4 days, 15 hours, 29 minutes
“Every project we take on starts with a question: How can we do what’s never
been done before?”
Stuart Hornery, CEO, Lend Lease
WOW Project “Acid Test”
Can you explain it - with zest -
to your 14-year-old?
“You really got to me. So many of our information technology projects take on a life of their own, and I know they’ll never end up as more than ‘mediocre successes.’ ”
CEO, F100 financial services company (10-98)
The greatest dangerfor most of us
is not that our aim istoo high
and we miss it,but that it is
too lowand we reach it.
Michelangelo
Characteristics of the “Also Rans”
–“minimize risk”–“respect the chain of command”–“support the boss”–“make budget”
Source: Fortune on “most admired global corporations”
Brand Inside
PSF 3:Brand You!
DISTINCT … OR EXTINCT!
“If there is nothing very special about your work, no matter how hard you apply yourself, you won’t get noticed and that increasingly means you won’t get paid much, either.”
Michael Goldhaber, Wired
“If one quarter can’t make the journey, that’s the way it
has to be.”
Carly Fiorina (1-00/Forbes)
Personal “Brand Equity” Eval– My current Project is challenging me …– New things I’ve learned in the last 90 days
include …– My public “recognition program”
consists of …– I am known for …– Additions to my Rolodex include …
–My resume is discernibly different from last year’s at this time …
R.D.A.Rate: 15%?, 25%?
Formal “Investment Strategy”/
R.I.P.
R.I.P.
IS IT ... WOW!?
R.I.P.10 … Major job change [new area of
concentration]; major offsite educational investment; extensive
sabbatical [oddball learning experience of > 2 months];
exceptional community project [presidency of fundraising drive, run
for school board].
R.I.P.
5 ... Extensive course work in oddball area of passionate interest; major off-
the-job activity [community involvement, learn to play the cello,
study Chinese].
1 … Company training, as directed.
Seminar Y2K
Message:
Distinct … or Extinct!
Brand Inside
PSF 4:Brand Talent!
Issue Y2K
The Great War for Talent!
“The leaders of Great Groups love talent and know where to find it. They revel in the talent of others.” Warren Bennis & Patricia Ward Biederman
Alan Kay on PARC’s Bob Taylor
“He was a connoisseur of
talent.”
“Our business needs a massive transfusion of talent. And talent, I believe, is most likely to be found among non-conformists, dissenters and rebels.” David Ogilvy
Axiom: Never hire anyone without an aberration in their
background. (Find the One Ton Cookie Man!)
Attributes of Those Who “Made” the 10th Grade History Book
–Committed!–Determined to make a difference!–Focused!–Passionate! –Irrational about their life’s project!–Ahead of their time/ Paradigm
busters!–Impatient/ Action Obsessed!
Attributes of Those Who “Made” the
10th Grade History Book –Made lots of people mad!–Flouted the chain of command!–Creative / Quirky / Peculiar!–Rebels!–Irreverent!–Masters of improv / Thrive on chaos/
Exploit chaos!
Attributes of Those Who “Made” the 10th Grade History Book
–Forgiveness > Permission
–Bone honest!
–Flawed as the dickens!
– “In touch” with their followers’ aspirations
–Damn good at what they do!
“Conformity is the jailer of freedom and the enemy of growth.” J.F.K.
Just Say “No” to “Grout”!
Participant: “Don’t you need ‘grout’ between the tiles?”
TP: “No!” [med staff, NFL Special Teams,waiters,
PFCs, cymbals player, bit parts, waiters]
“The boundaries for acceptable weirdness have
dramatically expanded.”
Michael Schrage
Talent War Y2K!
–All out!/ Time consuming!–Never ending!/ Unwinnable!–Includes everybody!/ Everybody’s
game! (“We’re all in sales.”)–Expensive!–Cool!/ WOW!/ Fun!/ Creative!–Strategic!/ Core competence!
Talent = Brand
Brand Outside=
Brand Inside
Brand Outside
Context:
No “Commodities”!
In the Beginning …
“The audit has become a commodity.”
Big 5 audit partner to TP
Quality Not Enough!
“Quality as defined by few defects is becoming the price of entry for automotive marketers rather than
a competitive advantage.”
J.D. Power
What’s Special?
“Customers will try ‘low cost providers’ because the Majors have not given them any clear
reason not to.”
Leading Insurance Industry
Analyst (10-98)
“We make over three new product announcements a
day. Can you remember them? Our customers
can’t!”
Carly Fiorina, HP
“The ‘surplus society’ has a surplus of similar companies, employing similar
people, with similar educational backgrounds, coming up with similar ideas, producing similar things, with similar prices, similar warranties and
similar quality.”
Kjell Nordstrom and Jonas Ridderstrale, Funky Business
The “10X/10X” Phenomenon
10 Times Better/
10 Times Less Different
“You do not merely want to be the best of the best. You want to be considered the only ones who do what
you do.”
Jerry Garcia
“customer satisfaction” to
“customer success”
Source: GE Power Systems
Brand Outside
Strategy 1:
Lead the Customer!
“The customer is a rear view mirror, not a guide to the future.”George Colony, Forrester Research
“If you worship at the throne of the voice of the customer, you’ll get only
incremental advances.”Joseph Morone, President, Bentley College
Early Customer Rejection
Post-Its [12 years!]Chrysler Minivans
VCRsFax machines
FedExCNN
Heart-assist pumpsEtc.
Source: Fortune
Good = Bad/ 1 of 30,000
“We are crazy. We should do something when people say it is
‘crazy.’ If people say something is ‘good’, it
means someone else is already doing it.”
Hajime Mitarai, Canon
“Wealth in this new regime flows directly from innovation, not
optimization. That is, wealth is not gained by perfecting the known,
but by imperfectly seizing the unknown.”
Kevin Kelly, New Rules for the New Economy
Benchmarking, Perils of …
“The best swordsman in the world doesn’t need to fear the second best swordsman in the world; no, the person for him to be afraid of is some ignorant antagonist who has never had a
sword in his hand before; he doesn’t do the thing he ought to do, and so the expert isn’t prepared for him; he does the thing he ought not to do and often it catches the expert out
and ends him on the spot.”
Mark Twain
Amen!
“The Age of the Never Satisfied
Customer”Regis McKenna
Brand Outside
Strategy 2:Master
E-Commerce!
$30,000,000. = ???
Dell’s Web sales … daily
2X = 100 days (Internet traffic)
2X = 9 months (network capacity)
Source: Red Herring (1-00)
Tomorrow Today: Cisco!
$7B of $10BSave $500M (service and tech
support)
C.Sat e >> C.Sat HCustomer Engineer Chat
Rooms ($1B?)
And Larry?
Cherry PickingVertical Markets
Plasticsnet.com: $370B; sellers pay $5K to $8K for
“storefront”; 5% to 10% cut
Hook: community services (database, catalogs, forums, industry job bank,
etc.)
B2B
1999 – 2004: 50X
2004: $7.4Source: GartnerGroup (per Reuters 1-26-00)
T
Welcome to
D.I.Y. Nation!“Changes in business processes will emphasize self service. Your costs as
a business go down and
perceived service goes up because customers are
conducting it themselves.” Ray Lane, Oracle
Anne Busquet/ American Express
Not: “Age of the Internet”
Is: “Age of Customer Control”
“In the network economy, the Website becomes the company’s primary interface to the customer.
The user interface becomes the marketing materials, store front,
store interior, sales staff and post-sales support all rolled into one.”
Jakob Nielsen, Designing Web Usability
Nielsen/Designing Web Usability
All Web projects are customer-interface projects! Simplicity rules!
Make it easy for customers to perform useful tasks!
Less “cool,” more useful!Speed rules!
“Where does the Internet rank in priority?
It’s No. 1, 2, 3, and 4.” Jack Welch
Web Strategy: GE Power Systems
“Launch and Learn”/4 sites in 30 days
Change … Or Die!
“Most of the brick and mortars look at the Internet as an add-on business … until they get a major scare. Then they either
change or die. … You have to put all your heart and soul in that direction, the way
Charles Schwab and Dell did.”
Flip Filipowski, divine interVentures (Red Herring)
There are 2 Kinds of …
Defense*
vs.
Offense**
*Fend off upstarts.**Reinvent our marketspace!
Brand Outside
Strategy 3:
Design Rules!
And Tomorrow …
“Fifteen years ago companies competed on price. Now It’s
quality. Tomorrow it’s design.”Robert Hayes
All Equal Except …
“At Sony we assume that all products of our competitors have basically the same
technology, price, performance and
features. Design is the only thing that differentiates one product
from another in the marketplace.”
Norio Ohga
Drop-dead Charm!
“The new Beetle fails at most categories. The only
thing it doesn’t fail in is drop-dead charm.”
Jerry Hirshberg, Nissan Design International
Object of Desire!“Every now and then, a design comes
along that radically changes the way we think about a particular object. Case in
point: the iMac. Suddenly, a computer is no longer an anonymous box. It is a
sculpture, an object of desire, something that you look at.”
Katherine McCoy, Michael McCoy, Illinois Institute of Technology
[ Design as Soul
“We don’t have a good language to talk about this kind of thing. In most people’s
vocabularies, design means veneer. … But to me, nothing could be further from the
meaning of design. Design is the fundamental soul of a man-made creation
that ends up expressing itself in successive outer layers of the product or
service.”Steve Jobs]
Brand Outside
Strategy 4:
It’s the Experience!
“Experiences are as distinct from services as
services are from goods.”Joseph Pine & James Gilmore, The
Experience Economy: Work Is Theater & Every Business a Stage
“The [Starbucks] Fix” Is on …
“We have identified a ‘third place.’ And I really believe that sets us apart. The third place is
that place that’s not work or home. It’s the place our
customers come for refuge.”
Nancy Orsolini, District Manager
Safe, On Time and …
“We defined personality as a market niche. We seek to
amuse, to surprise, to entertain.”
Herb Kelleher, Main Man, LUV Airlines
Experience: “Rebel Lifestyle!”
“What we sell is the ability for a 43-year-old accountant to dress
in black leather, ride through small towns and have people
be afraid of him.”
Harley exec, quoted in Results-based Leadership
Mantra: “Any good can be ing-ed”
the driving experiencethe pumping experience
the sitting experiencethe reading experiencethe washing experiencethe cooking experience
Joseph Pine & James Gilmore, The Experience Economy: Work Is Theater & Every Business a Stage
“This is the end of the pure product era. For instance, car
makers are beginning to understand that the car is a
platform for delivering services that drive the customer
experience.”Carly Fiorina, HP @ Comdex ’99
Brand Outside
BRAND POWER!
Brand?
DistinctionExcellence
Emotional “Signature”Trustworthiness
ConsistencyShorthand
Brand It! Now, More Than Ever!
“The increasing difficulty in differentiating between products and
the speed with which competitors take
up innovations will assist in the rise and rise of the brand.”
Gillian Law and Nick Grant, Management [New Zealand]
No Room for Brands?
NikeSaturnCNN
America OnlineCharles Schwab
StarbucksThe Gap
IntelEtc.
Brand = Trust!
“Most buyers do not have a clue whether anybody else makes a better microprocessor, but ‘Intel Inside’ has become a ‘trust mark’ - a trademark that consumers put their faith in.”
The Economist
Calling the Corporate Shrink!
“Organizational Psychotherapy”/
WHO WE ARE!
“Corporate Religion is a completely new way of thinking about companies. Today, the product is still the main communication
highway in the company. When companies make the shift to selling solutions, brands and attitudes … communicating the company’s
attitudes and values becomes the decisive parameter for success. It
demands that you find out who you are as a company.”
Jesper Kunde, Corporate Religion
Brand = You Must Care!
“Success means never letting the competition define you. Instead you have to define
yourself based on a point of view you care deeply about.”
Tom Chappell, Tom’s of Maine
Brand = Special = Passion =
Connection = Caring*
* (Way) beyond “market research”
The Ten Rules of Radical Marketing
CEO must “own” the marketing function!Hyper-lean Mktg. Dept. (No filters!)
CEO hangs out with customers!Love + Respect your customers!
Just Say No … to market research!Hire only passionate missionaries!
Create a Community of users-customers!Emphasize one-to-one marketing tools!
Celebrate craziness!Be insanely True to the Brand!
Sam Hill & Glenn Rifkin, Radical Marketing (e.g., Harley, Virgin, The Dead, HBS, NBA)
Brand Leadership
Lead Out Loud!
ENTHUSIASM RULES!*
“I am a dispenser of enthusiasm.”
Ben Zander*TP on Bob Nardelli/GE Power Systems
Ann R.’s Gospel– Show up!– Know your message!
–Put yourself at risk!
“If you ask me what I have come to do in this world, I
who am an artist, I will reply, I am here to live my
life out loud.”Emile Zola
“I’d rather regret the things I have done than the things I have not.”
Lucille Ball
“If things seem under control, you’re just not going fast enough!”
Mario Andretti
THE END