Tuesday, December 03, 2013

Dear Michael Dell: What Happened?

Michael:

I’m sure I’m not the first to say I’m excited to see you back leading the company you built. It’s been discouraging to see an organization that had pushed innovation so far, for so long, get lapped: first by lower cost manufacturers, then by the transformational forces of tablet computing and platform as a service. All of a sudden, your company is stuck with a bunch of laptops and servers that no-one needs, and nothing in the pipeline that’s going to move the needle (Venue tablets and consumer electronics? Meh.). I’m sure it’s an uncomfortable place to be.

Note to you, Michael Dell: if it’s a great deal, and it’s in someone’s cart, it’s a safe bet they’re going to buy it.

Not to add fuel to the fire, but the whole online commerce / integrated supply chain thing you had going is also no longer a competitive advantage. I bought my first two laptops (in 2001 and 2004) using Dell’s online “configure to order” capabilities that everyone else benchmarked against, just so I could brag about how easy it was to my peers. Nowadays, I can build everything you had in the early/mid-2000s using off-the-shelf solutions (e.g., Salesforce.com, BigMachines), yet it feels like your ordering experience hasn’t evolved since then. Forget features—the visual design feels like something a second-tier reseller would run.

Even with all these challenges, the Dell site was the first place I went this year to purchase a Christmas present for my teenage son. My wife was tired of him monopolizing the family laptop for “homework”, so I decided to take the plunge and get him a machine that would last him a couple of years. When I got your newspaper circular announcing your CyberMonday deals, I saw my opportunity—an Inspiron 15R Touch for $499. It was a PC Mag Editor’s Choice to boot!

Tuesday, February 19, 2013

Leveraging crowdsourcing for efficiency in Customer Experience Management (CEM)

Recently posted to Slideshare, a whitepaper I recently authored on leveraging the capabilities of crowdsourcing to transform the maintenance and management of interactive marketing content.

Tuesday, January 22, 2013

Choose better consultants by getting engaged

I’ve spent the better part of my career working in and around professional services—living the consulting life, providing support to consultants, or buying their services—but it’s only been recently that I’ve truly started to appreciate why so many consulting relationships fail, end with suboptimal results, or are simply difficult/challenging/frustrating/etc. I don’t assume that this is new thinking; on the contrary, if you’ve gotten here first, feel free to call me a nincompoop. However, as the number of businesses embracing purpose-driven success models continues to grow, it feels like a great time to discuss the need for stronger alignment between businesses and the consultants they engage.

For me, the idea of “consultant engagement” started as a response to a recent, particularly challenging client project I managed. While our team achieved the outcomes documented in the statement of work, the project was rife with challenges that formal agreements and methodologies don’t address. We were unable to establish an effective working relationship with the client, and frequent process and personality issues occurred throughout the project lifecycle. While we have continued to seek and win business with this client as a result of our success, there is an ongoing wariness on both sides that represents a risk for future efforts.

Hence, the Consultant Engagement Model (image below). Most professional services buyers generally have the understanding and skill necessary to identify consultancies that align with their business needs. Vendor management training, detailed RFPs and selection matrices are all designed to get to the right answer regarding need/specialization alignment. But this is only half of what’s required to ensure an effective working relationship.

Consultant Engagement Model
Creative Commons BY SA
The other (and frequently missing) half focuses on evaluating purpose and cultural alignment between the business and the consultancy. Even as companies adopt principles of employee and customer engagement, consultants are still viewed as “hired guns”. While this perspective may not harm the buyer on the lower end of the value chain (e.g., maintenance services), potential risk grows as services move closer to the core purpose and strategic focus of the firm. If you’ve got a cold, you can get the help you need from a doctor, pharmacist or nurse. If you have a heart problem, you need a doctor—and not just any doctor, but a cardiologist.

While consultancies will often present themselves as providing a limitless portfolio of services (a primary source of the “hired gun” attitude), it’s crucial to understand which parts of the service portfolio reflect the consultancy’s core purpose and strategic focus. At the same time, it’s important to look critically at your organization, especially with regards to how success is measured and achieved. Armed with this information, buyers can conduct a more objective assessment of vendor alternatives, seeking consultants who will fit more naturally and seamlessly within their organization.

Our team on the above-mentioned project had all the required expertise. Our challenges resulted from misalignment between the purpose and culture of our client and that of our consultancy. The company was interested in a web technology replacement with no new features or experience improvements; the core identity of our consultancy is wrapped up in the creation and realization of new experiences and capabilities for forward-thinking businesses. Did the client get what they wanted? Absolutely. Did the relationship effectively serve the purpose and strategic alignment of both parties? No; and significant untapped value was left on the table as a result.

So, what can a buyer do to improve purpose / culture alignment and achieve greater value from consulting relationships? A few suggestions come to mind:
  • Get past the sales pitch, fast. Sales professionals are useful at the ends of the sales cycle. At the front-end, they can provide initial context and connections. At the back-end, they’re useful for negotiating the details and closing. In the middle, when you’re trying to refine your thinking and solution approach, as well as get a better idea of organizational fit, seek the involvement of service delivery professionals. Push for participation by consultants that would be involved on the project, even if it requires some financial commitment.
  • Take references seriously. When you request (and check) references, look for context that is similar to your own. By default, sales professionals will offer up successful client relationships that support their primary objective--selling new business. Keep pressing until you’re talking to organizations whose purpose and culture are similar to yours, and work to expand your query beyond a single, designated contact into multiple touchpoints in the reference organization.
  • Go running together. When you’re looking for an exercise partner, you’re more likely to benefit from the relationship if you both have similar fitness levels and goals. Like going for an initial training run with a potential partner, look for opportunities to bring in consultancies for short-term, lower risk efforts that enable you to work together and evaluate fitness. The more often you do this, the better you’ll become at making objective assessments of new consultancies that knock on your door.
As you work through your selection process, keep in mind that (contrary to prevailing wisdom) consultants are people. As people, they go through hiring processes that have been defined (like your company’s) to identify candidates with both the right experience and the character to succeed within the purpose and culture of their organization. Commit your professional services “hiring process” to finding consultancies that provide not only the specialization you need, but also the purpose and cultural alignment that will ensure your mutual success for the long run.

Friday, October 12, 2012

Social Enterprise PoV

Recently posted to Slideshare, our current PoV on the Social Enterprise and Social Intranets.

Friday, May 04, 2012

save money on crowd labor? build brand affinity!

As many of you know, my off-hours project over the past few months has been a deeper analysis of the connection between worker engagement and brand affinity in a task-based labor market. Based on my hands-on experience with crowdsourcing solutions and literature review, I have arrived at the hypothesis that, in a task-based market, brands with stronger opinion / affinity ratings will have a labor cost advantage over lower performing brands. This hypothesis is based on what I perceive as a functional equivalence between brand preference in purchasing models (where preferred brands experience higher pricing power and/or rates of repurchase) and task selection models in the rapidly evolving task-based labor market. It is my opinion that brand preference will exhibit as a positive task selection bias confirmed by lower costs for equivalent work.

The research population for this directional research was a community of highly-rated workers on Amazon Mechanical Turk. A total of US-based 720 “Turkers” (as they refer to themselves) with completed task approval rates of greater than 90% and more than 500 tasks completed responded to the survey tool. Additional details on the survey methodology are covered in a prior post. Note that Amazon does not make available worker population counts for Mechanical Turk, so meaningful evaluations of statistical confidence are challenging.

The survey tool (screen capture available here) was constructed to require a participant to select between two theoretical tasks on Amazon Mechanical Turk. The participant was asked to make their choice based on the assumption that the tasks were effectively identical, and that the only difference between the two tasks was the identity of the task requestor. For the requestor, participants were asked to choose from two (2) randomly selected, well-known consumer brands. Participants were also asked how much the requestor of the non-selected task would have to pay in order to have their task chosen over the preferred brand (based on the assumption that their preferred brand was offering $1.00 to complete the task). Finally, participants were asked to provide their opinion of each brand on a Likert scale, ranging from “1 – Poor” to “5 – Excellent”.

The survey model was designed to provide a cost differential between the two (2) brands. This variable provides a measure of how much more the non-preferred requestor would have to pay in order to have their task completed instead of the preferred brand. The following histogram classifies the responses based on the cost differential reported by the respondent.

Cost Variance Histogram

As you can see, Turkers expect significantly more to complete tasks for a non-preferred requestor. Over 77% of respondees expect more than double (i.e., the categories including, and to the right of, “1.00 to 1.99 Additional”) to complete a task for a non-preferred requestor. While this level of difference may not hold over time as task-based markets become more mature, the current environment clearly requires a significant cost premium for those brands lacking in affinity.

Observation: Preferred brands pay a lot less, even when opinions are equivalent

My first exploration involved looking at just those situations where the participant gave both brands the same opinion score (e.g., they rated both “5 – Excellent”). Out of the 720 responses, 215 fell into this category. However, since the participant was required to choose one brand over the other and then provide a cost differential, it was possible to identify what a basic “preference” would cost a company. Based on the instruction that their preferred brand was offering $1.00 to complete the task, participants reported that they would expect an average of $2.91 from the non-preferred brand to complete the task (a cost differential of $1.91). This is nearly triple the cost to the preferred task requestor.

This is a striking result; when a Turker has to choose between two functionally equivalent tasks, requestor preference becomes a significant factor. And, even when the Turker holds similar opinions of both requestors, the preferred requestor has the potential for their work to be completed at much lower cost.

Observation: Brand opinion has a role to play, but only to an extent

Extending the initial analysis, I established the concept of “Opinion Distance”, a variable defined as the absolute value of the difference in opinion scores between the two (2) brands presented to the respondent. Based on this definition, Opinion Distance can range from “4” (i.e., Brand A = “5 – Excellent” and Brand B = “1 – Poor”) to “0” (i.e., both brands have the same opinion score). Responses were then categorized and averaged based on their Opinion Distance value.

As the following chart indicates, any difference in brand opinion (Opinion Distance greater than zero) results in a significant cost increase over and above the basic preference differential identified in Result 1. At an Opinion Distance of one (1), a Turker expects to receive an average of $3.58 to complete a task for which the preferred brand would pay $1.00, more than tripling the cost to the requestor.

Cost Variance vs. Count of Opinion Distance

Of particular interest is that there appears to be an implicit maximum premium that Turkers are willing to charge for a given task, regardless of brand opinion. While the average reward expectation differentials for Opinion Distance of two (2) and above are greater than basic preference (Opinion Distance of zero), they are actually less than responses with an Opinion Distance of one (1). Additional analysis needs to be performed, but it would appear that worker value models establish a reasonable maximum reward for a given task. The survey included a text response area that I am in the process of reviewing—it is hoped that this unstructured data will provide additional insight and direction for additional research.

Conclusion and future research directions

Based on this initial research, there would appear to be reasonable support for the established hypothesis. Additional analysis of the initial dataset should provide confirmation, and further results will be shared as the analysis is completed. I am also making the dataset available for download to anyone who would be interested in conducting their own analysis and contributing insight. You can download the Excel-formatted file here.

As mentioned, the results have provided multiple avenues for further investigation. Several that are of immediate interest are:
  1. Investigating the difference between preference and opinion as it relates to brand affinity in a task-based labor market, and identifying the significant components of each;
  2. Better understanding the mental models by which task workers value their effort and determine which tasks are “worth” completing;
  3. Identifying if there are significant differences in response patterns when crowd labor is a primary / exclusive source of income (vs. a contributing / optional source).
Finally, it should be noted that this research is not intended to be authoritative, but to establish initial direction for additional, more rigorous studies. In order to extend the validity of these findings, crowd workers from other platforms would need to be included, as well less qualified workers (e.g., lower task approval rates). However, the research does provide important insights to businesses seeking to leverage the most qualified crowd worker pool on today’s largest crowd worker platform.