1. Tom Peters’ Manifestos2002 The Solutions Imperative: From “Customer Satisfaction” to “Customer Success” Omnicom02.28.2002

2. All Slides Available at … tompeters.com

3. 1. Base Case …

4. “While everything may be better, it is also increasingly the same.” Paul Goldberger on retail, “The Sameness of Things,” The New York Times

5. “We make over three new product announcements a day. Can you remember them? Our customers can’t!” Carly Fiorina

6. “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 and similar quality.” Kjell Nordstrom and Jonas Ridderstrale, Funky Business

7. “Customers will try ‘low cost providers’ … because the Majors have not given them any clear reason not to.” Leading Insurance Industry Analyst

8. SWA > American + Continental + Delta + Northwest + United + USAirways. Source: Boston Globe (12.22.2001)

9. Getting Beyond Lip Service! “No longer are we only an insurance provider. Today, we also offer our customers the products and services that help them achieve their dreams, whether it’s financial security, buying a car, paying for home repairs, or even taking a dream vacation.”—Martin Feinstein, CEO, Farmers Group

10. 2002: Same-Same-Same … Farmers = GE = Oracle = MCAA = Biotech & Pharmaceutical Trainers = Omnicom

11. GE/IS: “We don’t sell circuit breakers.” Farmers: “We don’t sell insurance.” Oracle: “We don’t sell apps-in-boxes.” MCAA: “We don’t sell ‘a job.’” B&T Trainers: “We don’t sell pills.” Omnicom: “We don’t sell ads.” (Seagate: “We sell the sexiest boxes … and we’re proud of it.”)

12. Exec, CTFA: “The dirty little secret amidst an ‘age of consolidation’: It’s not all ‘channel management.’ We need some very cool products!”

13. Bob Lutz: “I see us as being in the art business. Art, entertainment and mobile sculpture, which, coincidentally, also happens to provide transportation.” Source: NYT 10.19.01

14. Whaddaboutheproduct? 20 of 26 7 of top 10

15. 2. A Pitiful Showing …

16. Forbes100 from 1917 to 1987: 39 members of the Class of ’17 were alive in ’87; 18 in ’87 F100; 18 F100 “survivors” underperformed the market by 20%; just 2 (2%), GE & Kodak, outperformed the market 1917 to 1987. S&P 500 from 1957 to 1997: 74 members of the Class of ’57 were alive in ’97; 12 (2.4%) of 500 outperformed the market from 1957 to 1997. Source: Dick Foster & Sarah Kaplan, Creative Destruction: Why Companies That Are Built to Last Underperform the Market

17. “Good management was the most powerful reason [leading firms] failed to stay atop their industries. Precisely because these firms listened to their customers, invested aggressively in technologies that would provide their customers more and better products of the sort they wanted, and because they carefully studied market trends and systematically allocated investment capital to innovations that promised the best returns, they lost their positions of leadership.” Clayton Christensen, The Innovator’s Dilemma

18. Forget>“Learn” “The problem is never how to get new, innovative thoughts into your mind, but how to get the old ones out.” Dee Hock

19. The [New] G e Way DYB.com

20. +29M = -44M + 73M +4M = +4M - 0M

21. “The secret of fast progress is inefficiency, fast and furious and numerous failures.” Kevin Kelly

22. “Active mutators in placid times tend to die off. They are selected against. Reluctant mutators in quickly changing times are also selected against.” Carl Sagan & Ann Druyan, Shadows of Forgotten Ancestors

23. “Chivalry is dead. The new code of conduct is an active strategy of disrupting the status quo to create an unsustainable series of competitive advantages. This is not an age of defensive castles, moats and armor. It is rather an age of cunning, speed and surprise. It may be hard for some to hang up the chain mail of ‘sustainable advantage’ after so many battles. But hypercompetition, a state in which sustainable advantages are no longer possible, is now the only level of competition.” Rich D’Aveni, Hypercompetition: Managing the Dynamics of Strategic Maneuvering

24. P&G … and the “billion dollar” trap.

25. 3. Searching for New Bases for Value Added …

26. The Big Day!

27. 09.11.2000: HP bids $18,000,000,000 for PricewaterhouseCoopers consulting business!

28. “These days, building the best server isn’t enough. That’s the price of entry.” Ann Livermore, Hewlett-Packard

29. HP … Sun … GE … IBM … UPS … UTC … General Mills … Springs … Anheuser-Busch … Carpet One … Delphi … Etc. … Etc.

30. “We want to be the air traffic controllers of electrons.” Bob Nardelli, GE Power Systems

31. “Customer Satisfaction” to “Customer Success” “We’re getting better at [Six Sigma] every day. But we really need to think about the customer’s profitability. Are customers’ bottom lines really benefiting from what we provide them?” Bob Nardelli, GE Power Systems

32. HP … Sun … GE … IBM … UPS … UTC … General Mills … Springs … Anheuser-Busch … Carpet One … Delphi … Etc. … Etc.

33. Gerstner’s IBM: Systems Integrator of choice. (BW/12.01). Global Services: $35B. Pledge/’99: Business Partner Charter. 72 strategic partners, aim for 200. Drop many in- house programs/products.

34. HP … Sun … GE … IBM … UPS … UTC … General Mills … Springs … Anheuser-Busch … Carpet One … Delphi … Etc. … Etc.

35. “UPS wants to take over the sweet spot in the endless loop of goods, information and capital that all the packages [it moves] represent.” ecompany.com/06.01 (E.g., UPS Logistics manages the logistics of 4.5M Ford vehicles, from 21 mfg. sites to 6,000 NA dealers)

36. HP … Sun … GE … IBM … UPS … UTC … General Mills … Springs … Anheuser-Busch … Carpet One … Delphi … Etc. … Etc.

37. New Springs = Turnkey Collections. Flexible sourcing. Packaging. Merchandising. Promotion. Systems & Site mgt.

38. Who was the number one employer of architecture school grads in the U.S. last year?

39. The Pursuit of … Whatever: Accenture to “do” AT&T’s sales & customer service … for $2.6B/5 years … savings to AT&T of 50%. Accenture to “do” Avaya’s corporate learning & training. Source: BW (02.04.2002)

40. “VISIONS OF A BRAND-NAME OFFICE EMPIRE. Sam Zell is not a man plagued by self doubt. Mr. Zell controls public companies that own nearly 700 office buildings in the United States. … Now Mr. Zell says he will transform the real estate market by turning those REITs into national brands. … Mr. Zell believes [clients] will start to view those offices as something more than a commodity chosen chiefly by price and location.” –New York Times (12.16.2001)

41. Problem: Everybody is going after the same space!

42. 4. Cut The [Internal] Crap …

43. Dell’s OptiPlex Facility Big Job: 6 to 8 hours. (80,000 per day) Parts Inventory: 100 square feet.

44. Message: eCommerce is not a technology play! It is a relationship, partnership, organizational and communications play, made possible by new technologies.

45. “Ebusiness is about rebuilding the organization from the ground up. Most companies today are not built to exploit the Internet. Their business processes, their approvals, their hierarchies, the number of people they employ … all of that is wrong for running an ebusiness.” Ray Lane, Kleiner Perkins

46. “CRM has, almost universally, failed to live up to expectations.” Butler Group (UK)

47. CGE&Y (Paul Cole): “Pleasant Transaction” vs. “Systemic Opportunity.” “Better job of what we do today” vs. “Re- think overall enterprise strategy.”

48. Read It Closely: “We don’t sell insurance anymore. We sell speed.” Peter Lewis, Progressive

49. Suppose, just suppose, that the Web is a new world we’re just beginning to inhabit. We’re like the earlier European settlers in the United States, living on the edge of the forest. We don’t know what’s there and we don’t know exactly what we need to do to find out: Do we pack mountain climbing gear, desert wear, canoes, or all three? Of course while the settlers may not have known what the geography of the new world was going to be, they at least knew that there was a geography. The Web, on the other hand, has no geography, no landscape. It has no distance. It has nothing natural in it. It has few rules of behavior and fewer lines of authority. Common sense doesn’t hold here, and uncommon sense hasn’t yet emerged.” David Weinberger, Small Pieces Loosely Joined

50. 5. The V.A./Solutions Imperative = The Talent Imperative …

51. From “1, 2 or you’re out” [JW] to … “Best Talent in each industry segment to build best proprietary intangibles” [EM] Source: Ed Michaels, War for Talent (05.17.00)

52. “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, Organizing Genius

53. Model 25/8/53: Sports Franchise GM

54. Message: Some people are better than other people. Some people are a helluva lot better than other people.

55. “Are there enough weird people in the lab these days?” V. Chmn., pharmaceutical house, to a lab director (06.01)

56. Rule No. 1 (and there are no other rules): How do we configure our company/operation so that we’re truly able to provide talented people the “ride of their lives”? Source: Equinox Manifesto (12.01)

57. 6. V.A. = “Freakiness” …

58. Saviors-in-Waiting Disgruntled Customers Off-the-Scope Competitors Rogue Employees Fringe Suppliers Wayne Burkan, Wide Angle Vision: Beat the Competition by Focusing on Fringe Competitors, Lost Customers, and Rogue Employees

59. CUSTOMERS: “Future- defining customers may account for only 2% to 3% of your total, but they represent a crucial window on the future.” Adrian Slywotzky, Mercer Consultants

60. !

61. COMPETITORS: “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

62. Employees: “Are there enough weird people in the lab these days?” V. Chmn., pharmaceutical house, to a lab director (06.01)

63. Suppliers: There is an ominous downside to strategic supplier relationships. An SSR supplier is not likely to function as any more than a mirror to your organization. Fringe suppliers that offer innovative business practices need not apply.” Wayne Burkan, Wide Angle Vision: Beat the Competition by Focusing on Fringe Competitors, Lost Customers, and Rogue Employees

64. 7. “Solutions Imperative” = 100% Work That Matters [WOW Flavor] …

65. “Reward excellent failures. Punish mediocre successes.” Phil Daniels, Sydney exec

66. Language matters! Wow! BHAG! “Takes your breath away!”

67. “Intimidate their [users] imaginations” … “Where’s the revolution?” –J Allard, on the Xbox

68. “Learn not to be careful.” Photographer Diane Arbus, to her students

69. Characteristics of the “Also rans”* “Minimize risk” “Respect the chain of command” “Support the boss” “Make budget” *Fortune, article on “Most Admired Global Corporations”

70. 8. The Solutions Imperative: From “Customer Satisfaction” to “Customer Success.”

71. The … Solutions25

72. 1. It’s the (OUR!) organization, stupid! 2. Friction free! 3. No STOVEPIPES! 4. “Stovepiping” is a F.O.—Firing Offense. 5. ALL on the Web! (ALL = ALL.) 6. Open access! 7. Project Managers rule! (E.g.: Control the purse strings and evals.) 8. VALUE-ADDED RULES! (Services Rule.) (Experiences Rule.) (Brand Rules.) 9. SOLUTIONS RULE! (We sell SOLUTIONS. Period. We sell PRODUCTIVITY & PROFITABILITY. Period.) 10. Solutions = “Our ‘culture.’ ” 11. Partner with B.I.C. (Best-In-Class). Period.

73. 12. All functions contribute equally—IS, HR, Finance, Purchasing, Engineering, Logistics, Sales, Etc. 13. Project Management can come from any function. 14. WE ARE ALL IN SALES. PERIOD. 15. We all invest in “wiring” the customer organization. 16. WE ALL “LIVE THE BRAND.” (Brand = Solutions. That MAKE MONEY FOR OUR CUSTOMER- PARTNER.) 17. We use the word “PARTNER” until we all want to barf! 18. We NEVER BLAME other parts of our organization for screwups. 19. WE AIM TO REINVENT THIS INDUSTRY! 20. We hate the word-idea “COMMODITY.”

74. 21. We believe in “High tech, High touch.” 22. We are DREAMERS. 23. We deliver. (PROFITS.) (CUSTOMER SUCCESS.) 24. If we play the “SOLUTIONS GAME” brilliantly, no one can touch us! 25. Our TEAM needs 100% I.C.s (Imaginative Contributors). This is the ULTIMATE “All Hands” affair!

75. “No longer are we only an insurance provider. Today, we also offer our customers the products and services that help them achieve their dreams, whether it’s financial security, buying a car, paying for home repairs, or even taking a dream vacation.”— Martin Feinstein, CEO, Farmers Group

76. Thank You !