Tom Peters’ We Are in a Brawl with No Rules Phoenix 24/November/2002

“We are in a brawl with no rules.” Paul Allaire

I. Life, Death & the Digital Revolution

“IT MAY SOMEDAY BE SAID THAT THE 21 ST CENTURY BEGAN ON SEPTEMBER 11, … “Al-Qaeda represents a new and profoundly dangerous kind of organization—one that might be called a ‘virtual state.’ In September a virtual state proved that modern societies are vulnerable as never before.”—Time/

“The deadliest strength of America’s new adversaries is their very fluidity, Defense Secretary Donald Rumsfeld believes. Terrorist networks, unburdened by fixed borders, headquarters or conventional forces, are free to study the way this nation responds to threats and adapt themselves to prepare for what Mr. Rumsfeld is certain will be another attack. … “ ‘Business as usual won’t do it,’ he said. His answer is to develop swifter, more lethal ways to fight. ‘Big institutions aren’t swift on their feet in adapting but rather ponderous and clumsy and slow.’ ”— The New York Times/

“Our military structure today is essentially one developed and designed by Napoleon.” Admiral Bill Owens, former Vice Chairman, Joint Chiefs of Staff

“In an era when terrorists use satellite phones and encrypted , US gatekeepers stand armed against them with pencils and paperwork, and archaic computer systems that don’t talk to each other.” Boston Globe ( )

“The organizations we created have become tyrants. They have taken control, holding us fettered, creating barriers that hinder rather than help our businesses. The lines that we drew on our neat organizational diagrams have turned into walls that no one can scale or penetrate or even peer over.” —Frank Lekanne Deprez & René Tissen, Zero Space: Moving Beyond Organizational Limits.

“Dawn Meyerreicks, CTO of the Defense Intelligence Systems Agency, made one of the most fateful military calls of the 21 st century. After 9/11 … her office quickly leased all the available transponders covering Central Asia. The implications should change everything about U.S. military thinking in the years ahead. “The U.S. Air Force had kicked off its fight against the Taliban with an ineffective bombing campaign, and Washington was anguishing over whether to send in a few Army divisions. Donald Rumsfeld told Gen. Tommy Franks to give the initiative to 250 Special Forces already on the ground. They used satellite phones, Predator surveillance drones, and GPS- and laser-based targeting systems to make the air strikes brutally effective. “In effect, they ‘Napsterized’ the battlefield by cutting out the middlemen (much of the military’s command and control) and working directly with the real players. … The data came in so fast that HQ revised operating procedures to allow intelligence analysts and attack planners to work directly together. Their favorite tool, incidentally, was instant messaging over a secure network.”—Ned Desmond/“Broadband’s New Killer App”/Business 2.0/ OCT2002

Eric Shinseki’s Army Flat. Fast. Agile. Adaptable. Light … But Lethal. “I Am An ARMY of One.” Info-intense. Network-centric.

From: Weapon v. Weapon To: Org structure v. Org structure

II. All Bets Are Off.

“There will be more confusion in the business world in the next decade than in any decade in history. And the current pace of change will only accelerate.” Steve Case

“Most of our predictions are based on very linear thinking. That’s why they will most likely be wrong.” Vinod Khosla, in “GIGATRENDS,” Wired 04.01

“The corporation as we know it, which is now 120 years old, is not likely to survive the next 25 years. Legally and financially, yes, but not structurally and economically.” Peter Drucker, Business 2.0 (08.00)

“In 25 years, you’ll probably be able to get the sum total of all human knowledge on a personal device.” Greg Blonder, VC [was Chief Technical Adviser for Corporate AT&T] [Barron’s ]

2.5G, 3G, 4G Windows Symbian Java Bluetooth Wi-Fi PCs-PDAs-Cell“phones” E-business vs. M-business Etc.

“Unless mankind redesigns itself by changing our DNA through altering our genetic makeup, computer- generated robots will take over the world.” – Stephen Hawking, in the German magazine Focus

Outsider’s view: (1) Billions are being spent, even in a down market. (2) NOBODY HAS A CLUE AS TO WHO THE WINNERS—AND LOSERS— WILL BE. (3) Yet you must play. Now. Hard. Fast.

III. The Destruction Imperative.

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 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 Source: Dick Foster & Sarah Kaplan, Creative Destruction: Why Companies That Are Built to Last Underperform the Market

“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

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

“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

C.E.O. to C.D.O.

“It is generally much easier to kill an organization than change it substantially.” Kevin Kelly, Out of Control

The [New] G e Way DYB.com

“Strategy meetings held once or twice a year” to “Strategy meetings needed several times a week” Source: New York Times on Meg Whitman/eBay

“If you don’t like change, you’re going to like irrelevance even less.” —General Eric Shinseki, Chief of Staff, U. S. Army

No Wiggle Room! “Incrementalism is innovation’s worst enemy.” Nicholas Negroponte

“The difficulties … arise from the inherent conflict between the need to control existing operations and the need to create the kind of environment that will permit new ideas to flourish—and old ones to die a timely death. … We believe that most corporations will find it impossible to match or outperform the market without abandoning the assumption of continuity. … The current apocalypse—the transition from a state of continuity to state of discontinuity—Has the same suddenness [as the trauma that beset civilization in 1000 A.D.]” Richard Foster & Sarah Kaplan, “Creative Destruction” (The McKinsey Quarterly)

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)

IV. IS/ IT/ Web … “On the Bus” or “Off the Bus.”

100 square feet

The Real “News”: X1,000,000 TowTruckNet.com

Impact No. 1/ Logistics & Distribution: Wal*Mart … Dell … Amazon.com … Autobytel.com … FedEx … UPS … Ryder … Cisco … Etc. … Etc. … Ad Infinitum.

Autobytel: $400. Wal*Mart: 13%. Source: BW( )

WebWorld = Everything Web as a way to run your business’s innards Web as connector for your entire supply-demand chain Web as “spider’s web” which re-conceives the industry Web/B2B as ultimate wake-up call to “commodity producers” Web as the scourge of slack, inefficiency, sloth, bureaucracy, poor customer data Web as an Encompassing Way of Life Web = Everything (P.D. to after-sales) Web forces you to focus on what you do best Web as entrée, at any size, to World’s Best at Everything as next door neighbor

“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

“There’s no use trying,” said Alice. “One can’t believe impossible things.” “I daresay you haven’t had much practice,” said the Queen. “When I was your age, I always did it for half an hour a day. Why, sometimes I’ve believed as many as six impossible things before breakfast.” Lewis Carroll

“Don’t rebuild. Reimagine.” The New York Times Magazine on the future of the WTC space in Lower Manhattan/

“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

Case: CRM

Anne Busquet/ American Express Not: “Age of the Internet” Is: “Age of Customer Control”

Amen! “The Age of the Never Satisfied Customer” Regis McKenna

“The Web enables total transparency. People with access to relevant information are beginning to challenge any type of authority. The stupid, loyal and humble customer, employee, patient or citizen is dead.” Kjell Nordström and Jonas Ridderstråle, Funky Business

“Parents, doctors, stockbrokers, even military leaders are starting to lose the authority they once had. There are all these roles premised on access to privileged information. … What we are witnessing is a collapse of that advantage, prestige and authority.” Michael Lewis, next

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

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

V. Charge … Up the Value-added Ladder: Sell “Solutions”/ “Success”/ “Experiences”/ “Dream Fulfillment”/ Design = Soul/ Brand = ALL!

“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 Nordström and Jonas Ridderstråle, Funky Business

The Value-added 3-Step

Step 1. “Satisfaction” to “Solutions” & “Success”

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

“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)

Step 2. Solutions+ = Awesome Experiences

“ Experiences are as distinct from services as services are from goods.” Joseph Pine & James Gilmore, The Experience Economy: Work Is Theatre & Every Business a Stage

“Club Med is more than just a ‘resort’; it’s a means of rediscovering oneself, of inventing an entirely new ‘me.’ ” Source: Jean-Marie Dru, Disruption

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

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

“Lexus sells its cars as containers for our sound systems. It’s marvelous.” —Sidney Harman/ Harman International

WHAT CAN BROWN DO FOR YOU?

Step 3. The Bedrock: Design = “Soul”

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

VI. SHE … Is the Customer!

91% women: ADVERTISERS DON’T UNDERSTAND US. (58% “ANNOYED.”) Source: Greenfield Online for Arnold’s Women’s Insight Team (Martha Barletta, Marketing to Women)

Read This Book … EVEolution: The Eight Truths of Marketing to Women Faith Popcorn & Lys Marigold

EVEolution: Truth No. 1 Connecting Your Female Consumers to Each Other Connects Them to Your Brand

“Women don’t buy brands. They join them.” EVEolution

VII. Leading in … Totally Screwed Up Times

The Kotler Doctrine: : R.A.F. (Ready.Aim.Fire.) : R.F.A. (Ready.Fire!Aim.) 1995-????: F.F.F. (Fire!Fire!Fire!)

“If it works, it’s obsolete.” —Marshall McLuhan

“I’m not comfortable unless I’m uncomfortable.” — Jay Chiat

“If things seem under control, you’re just not going fast enough.” Mario Andretti

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

The greatest danger for most of us is not that our aim is too high and we miss it, but that it is too low and we reach it. Michelangelo

Thank You !