Personal information has become a gateway drug for business

We treat commerce as some sort of separate entity today, but it is quite simply one element of the integrated society we have built. Money is nothing more than a promise, a contract between people. It only works if we all have trust in the system. Money was created as a way of allowing people to trade goods and services in a consistent way.

Money only works if we all accept it as having value, if we lose trust in money they we all need to start carrying around purses with precious metals and shiny objects, that we could use to negotiate for goods and services.

Decades ago we moved away from using coins and notes to using numbers, but initially we had to have a copy of the numbers on our person to share with those we were trading (credit cards, checks etc).

Now all we have to do is give someone our numbers and they can suck money from our bank accounts or credit cards for us to pay later, or implement more complex contracts such as loans or major purchases. Your employer pays you the same way, numbered accounts in numbers locations is all that is needed to move money around.

Numbers are easy. You go into a restaurant and they suck money out of your credit card account. You take a taxi and the same happens. It’s very easy to move money around.

But what happens when the system breaks? What happens when a criminal gets hold of your numbers. They go to CVS and swipe a copy of your credit card, who checks? What happens when the disillusioned minimum wage worker at a fast food restaurant scans your card when they take your order and sells your information. And what happens when the bank doesn’t have enough security around your personal and private numbers, and they are stolen? What happens when one of the largest consumer credit reporting agencies, which has been collecting vast amounts of your personal and private data, loses it?

Quite simply we rely on a small series of numbers as our personal identity. These numbers are published in public documents, as well as being collected by many different organizations. And we have almost no control over how they are published, stored or used.

Theft of these numbers, our identities can take place across political boundaries, meaning it’s next to impossible to bring criminals down.

When someone collects and stores our personal information, they are taking on a responsibility to each person whose information they collect. If by their actions or inactions, that information reaches a criminal who steals from us, they have an absolute responsibility for the loss.

If a person dies because a car manufacturer installed brakes incorrectly, they are responsible. If a drug company creates a treatment with an adverse effect that wasn’t fully understood, they are responsible. And if you suffer a loss because a bank, a financial institution or a vendor failed to protect their copy of your personal data they should be directly responsible for the loss, and for repairing any damage it causes.

The law must reflect the importance we all place on personal data. Today it does not. There are some “soft” laws that describe how data must be protected, but when a business fails to implement these rules effectively the legal response is almost imperceptible. Let people know you screwed up, and maybe offer them a service to monitor their finances for a period of time, and then it’s business as usual.

Most of the world uses a Chip and pin credit card system. Where you have to both have a physical credit card and know a secret pin number to complete an in-store transaction. And nearly every county in the world mandates that that transaction must be entirely performed by the purchaser. In the US, this is not the case, we have a chip in our credit cards, but no pin number. And virtually every restaurant in the US uses a system where the waiter takes your credit card off of you and takes it to a machine out of your sight. These weaknesses lead to thefts that the rest of the world have already solved.

The US also relies on a social security number as the sole piece of personal data needed to prove your identity. Nowhere else in the world is this considered an acceptable practice.

Why is the US so weak in identify protection? Because the banks and vendors are not held responsible for loss, it’s normally left up to the consumer. If the bank makes a loss, they hike up their rates to cover it, the consumer pays.

We need a solid legal framework to protect the whole system, and that probably means much more infrastructure than a piece of paper issued to every citizen and legal immigrant when they are kids or first get the right to work, with a single nine digit number on it.

It’s time for the law to catch up with the requirement. And this means strict regulations and draconian penalties for non-compliance.

Today we have the technology to encrypt data, capture and use biometrics, spot fraudulent access using advanced artificial intelligence, communicate directly to everyone, anywhere, anytime and validate any number of ways.

But do we have the collective will to change a system that’s working quite well for banks, who have become addicted to social security numbers, credit scores, and acceptable losses without penalty?


Enhancing Shareholder Value a.k.a. killing business success

At some point in the 1980’s someone came up with the idea of shareholder value. The idea was that the ultimate success of a company was to maximize the value that the company delivered to shareholders. Seems like a pretty reasonable idea, until you start to see what people who use this term really mean.

What is often done in the name of “enhancing shareholder value” is totally the antipathy of the obvious definition of the idea.

Surely (you would imagine) that shareholders would want to see a company perform well over a long period of time. And you would imagine that performing well would be a simple concept, where the money a company spends on developing and selling its product would be less than the money it brings in from its customers. You would imagine that in the same way you balance your bank account every month a company would be measured as being successful if there was “profit” on the business they perform.

But you would not be correct!

The stock market and therefore the executives of large companies look for increasing returns not just profit. So if a company continually makes a 10% profit every year according to those who measure shareholder value that company is failing.

So the pressure is on to show increases in revenue, and decreases in costs, so that year on year, quarter on quarter the business “grows”, and so the company gets bigger and the shareholders are then told by the “experts” that the shareholder value is increasing.

This drives companies to off-shore their workforce, find lower cost suppliers, reduce their work force and consider unbelievably expensive mergers and acquisitions. In the very short term these things seem to drive down costs or increase revenue and so that’s a good thing. But they really don’t make a company healthier, they kill it.

I’ve seen company executive’s looks to buy a company at any cost, just to get a small increase in revenue this year. It doesn’t matter that the money spent can never be recovered, it’s about achieving a revenue target, not a margin target. It’s often inane.

A large number of acquisitions never make a profit, what they do in move huge sums of money and stock from a healthy company to the owners of a less healthy company. The two merged companies for a short time have increased revenue, but the cost and mess of merging the businesses often leads to reduced performance and so the growth slows down. Angry customers leave, and new customers question the value of entering this created confusion. So all too often the sum of the parts is less than the whole, and within a few years the revenue of the merged business looks like the revenue would have already been of the healthier if the two parts if they had not merged. To me that says that the billions spent on the merger were entirely wasted. At the same time all the changes demanded to streamline the two businesses cause the best and the brightest to leave and huge political infighting between executives takes place to grab the reduced number of top spots. Innovation slows and then the business is forced to go through more rounds of off-shoring and layoffs to reduce costs even further to have to pay for the debt created from the merger.

Of course there are winners from M&A, those who broker the deal, the CEO’s and CFO’s, the banks and the private equity firms all get lucrative multi-million dollar payoffs as part of their self-created wonderland.

And there are lots of losers, employees, customers, shareholders.

I’ve worked for a number of companies who have acquired large businesses over and over again, and I’ve seen the carnage it creates. Apart from the small number of execs and bankers who make the deal happen, I’m at a loss to see who gains, except maybe of course for India and China.

Maximizing shareholder value seems to be the modern euphemism for “Screw you I’m taking it all”.


The one and only way to succeed with B2B marketing

Why is it that most B2B CMO’s last just a year or so? It’s simple they fall into the B2C trap, their CEO will ask them how much demand that last ad campaign generated, and they give an answer. It’s that simple the clock is ticking, trust will decay and a new CMO will be in within the year.

What happens? Well B2B marketing is a complex derivative process, where slowly but surely through brand enhancing value exchanges (aligned very carefully to the specifics of the target audience) prospects learn of problems that they should be thinking about solving, realize these are their problems, form a strategy to solve these problems, identify choices and enact a process of consideration, purchase and implementation. It’s a carefully crafted business process that involves decision makers, influencers, approvers and advisers.

B2B marketers have to make sure that they are providing great compelling knowledge, advice and quality access to the right people throughout the process without annoying the prospects. Being in consideration is key.

If the CMO ever says “well that advert generated 200% ROI” without explaining that the return on that investment was to move the needle on the brand or get prospects to move from unaware to aware then the assumption that the CEO would have it that that ad closed deals. That assumption can only lead to an erosion of trust, as clearly no ad in a B2B world actually closes a deal directly.

A B2B marketing campaign starts with a source of people to market too. These are contacts.

When a contact interacts with the campaign, ie. signing up for an event, downloading a gated asset, then that’s great, they are inquiring.

When those inquiring contacts start to share information about their intent which such jewels as a timeline, access to a budget, details on their requirement, then they are a lead.

And when that lead starts to get detailed it becomes qualified.

And when a qualified lead is accepted by sales as one they will expend effort on trying to win, assign an expected close date and a proposed deal value it becomes an opportunity.

I find it very helpful to call this the CILO process, as it’s a simple idea that the whole business can understand and adopt.

Not every single touch point builds leads, but campaigns build contacts, inquiries, leads, qualified leads and opportunities (CILO). Those are the true measures of a B2B marketing team. Ones that deeply drive sales and can start with a strategy and end with tactical success.

Training a CEO on what to expect and how to gain value from B2B marketing is the first and last job of the head of marketing. When the CEO and the marketing leaders are aligned, great things happen.

Any CMO that has survived longer that two years in a B2B marketing organization (without the CEO changing) is doing this.

When you look to hire a new head of marketing and you’re a B2B company, think about this when you read those resumes….


Experiences with Carly Fiorina



Let me explain.

When you play chess there are several things you need.












The “Dewarding” of Ideas & Extra Effort

“Coming up with a great idea or new innovation to help the business/organization is a great thing for all.”

“Driving an under-resourced or otherwise daunting project to on-time success through grit, determination, and superhuman effort is even better.”

The above 2 statements are both correct and at the same time, untrue in most businesses. They are misnomers (if not outright lies) if management speaks them to employees. Think of them as the Shroedinger’s Cats of business behavior. Dead and alive, true and false, at the same time.

Despite all the evidence that encouraging and rewarding those behaviors will drive success, the norm today is to 1) spurn new ideas and innovation (because staying the same is seemingly easier and less risky), and 2) rather than recognize and reward a herculean effort from an individual (with time off or other perks and accolades), to raise the bar and make that level of effort the new minimum standard of effort and/or replicate the project across other areas (effectively giving the person exponentially more work as their “deward”).

Based on these common practices, only new hires (who only do it once btw), and self-motivated, deadline obsessed gluttons for punishment are idea-generators who give extreme effort to ensure daunting projects are on-time and successful.

There are exceptions to this sad reality however, so that’s where we should look now:

-Exception 1 – Most Non-profits: These organizations have an actionable, non greed-based mission statements. Through their training, positive reinforcement motivational practices, and passionate management (including activist Board members), they each typically have an army of extra effort, innovation-generating brand evangelists (whereas most companies have rank and file employees and managers).

IMG_8395.JPGException 2 – Peter Drucker-ian Businesses: These are the rare businesses that live the teachings of history’s greatest expert on management (and marketing for that matter), rather than just hanging his quotes on the wall with a picture of the Harvard rowing team.

Embedding in their company Drucker’s teachings on the role of the Board, mission statements, managing and motivating “knowledge workers,” and truly understanding both your target customer’s problems/needs and “what business you’re in” (from the perspective of the customer) make the first two statements the norm for these exceptional businesses and organizations.

peter-drucker-quote-how-can-we-overcome-the-resistance-to-innovationThink about your organization and how it really acts on a regular basis. Odds are that in real practice, you’re the norm, not an exception.

If you and your management team haven’t read “The Essential Drucker” in the past year, it will be the best 4 hours and $20 you’ve ever invested.

Interesting note, “The Essential Drucker” book has a section on what business can learn from non-profits, so the 2 categories of exception are really closer to 1.

Finally, to quote Larry Wilson on giving extra effort on every project at work to get ahead, “My old man worked hard. All they did was give him more work.”

Yes, that quote was from “Weekend at Bernie’s” but that doesn’t make it less true. Make it not true at your organization and have a REwarding 2015.