Presentation by Andrey Kessel, Co-Founder & Partner, TexDrive
Write-up by Linsey Willaford-West, Founder, eTeamUps
Andrey presented a case study of Solexa’s journey from startup to a buy-out by Illumina raising the following points as the key lessons learned.
February 3, 2012 | Techmeetups
- Remember that funding is just a tool, it is not the end game
- Building a company is always a rollercoaster – ever the best known ones went through the period that you are going through!
- Valuation is a function of risk. The more risk that you eliminate (i.e. technical risk, market risk and team risk ), the higher valuation you get. This is linked to the milestones for building a company
- Get a good team and a set of advisors/people you can draw upon
- Insisting on NDAs too much is a red flag for investors and tells them that either the entrepreneur is naive or the business is non-defensible
Original post by Alex Goldfayn via HBR
I’ve spent the week in Las Vegas at the Consumer Electronics Show (CES), where billion-dollar companies unveil multi-million-dollar products looking for mainstream popularity, and where startups unveil ideas, looking for angles and angels.
And everywhere you go in this gathering of the smartest people in the most exciting business category on the planet, there are marketing mistakes being made. It’s fascinating, really: most of the products and ideas shown here are tremendous — it’s the showing that is generally awful. The engineering of electronics has never been healthier, but the quality of the marketing lags far behind. To wit:
All the focus is on the features, not the lifestyle. I tell my clients that if they want to create consumer evangelists, they must begin by painting a picture of lifestyle improvement. Show the consumer what their life will look like after using your device for a while. Sure, it’s an industry show, and the press here understands technology, but how do you think they will communicate about your product if all you give them is tech specs?
For example, you don’t make a video-distribution technology. You let people enjoy their favorite movies and shows, from any device, on any screen in their home.
You don’t make wireless Airplay speakers. Rather, you liberate music from the confines of a hard drive for families to enjoy together.
Be bold, be shameless. There’s too much matter-of-fact, borderline defensive messaging here. Technology marketing needs to be shameless. It’s not a coincidence that the most wildly successful marketer on the planet, Apple, is also the most shameless marketer. Don’t worry about turning a few people off by being over-the-top. Instead, worry about not capturing the market’s attention by being ordinary and plain. Tell people what’s amazing about your product or service, as descriptively as possible. Back to our examples:
You don’t make video-distribution technology. You bring joy and entertainment to people.
You don’t make speakers. You bring beautiful music into people’s hearts.
Marketing is no place to be modest.
The people at the booths are not helpful — to attendees or to exhibitors. Many exhibitors build small cities for booths here, and they contract trade show “professionals” to “work” their temporary town. Some of these people are half-naked. Some color coordinated. All are trained in three or four talking points on the product they stand next to. And none of them are helpful. They can’t answer any questions. What if a new buyer happens upon them, or, God forbid, a reporter? You solve this problem by bringing your employees to work the booth. Your HR people and administrative assistants would be far more informed than the folks representing you currently.
There are too many agencies doing a bad job at CES. This is a year-long problem in the industry, but it’s especially pronounced this week. For example, one PR agency rep sent six press releases about one client in the days leading up to the show. The client, a smaller company, did not know this was happening, and learned through communications from angry recipients who felt they were being spammed. Ask yourself: do you know exactly how your agency is representing you, and is it helpful?
Unforced errors abound. So many harmful mistakes in consumer electronics marketing are self-made. It’s the same at CES: look at the list of marketing issues above. These problems are entirely avoidable: Get smart people into the booth. Know your agency’s activity. Focus on emotion and lifestyle. Not doing so is voluntary harmful behavior. The electronics industry is difficult enough; why not avoid putting obstacles in your own path?
January 17, 2012 | Techmeetups
Original post by SERGUEI NETESSINE via HBR
This post is part of the HBR Forum, The Future of Retail.
Along with the growth in scale of leading retailers in the 20th century came a growing attitude toward the people working in the stores: they were a cost to be minimized. Sam Walton, the founder of the biggest retailer in the world, summed it up in his book Made in America: “No matter how you slice it in the retail business, payroll is one of the most important parts of overhead, and overhead is one of the most crucial things you have to fight to maintain your profit margins. That was true then, and it is still true today.” But recent research by my colleagues and I suggests that retailers are thinking far too simplistically about the cost and potential value of their workforces.
Let’s start with stockouts, a problem most big retailers are highly attuned to; they know that when a customer arrives intending to make a purchase and finds the shelf picked clean of the desired item, the store not only loses a sale but also damages the likelihood of that customer’s returning. Fixated on that challenge, retail chains have invested heavily in sophisticated inventory management systems. Yet at one large retail chain we studied (pdf), those systems didn’t seem to be doing the trick. When we analyzed results of a customer survey, we found that nearly 20% of the products they wanted to buy were out of stock. This was despite the fact that, according to the inventory management system, only 2-3% of items ever ran out before being replenished. It wasn’t that the system’s numbers were wrong. The problem was that customers couldn’t find what they were looking for—and without a store associate to help, they left empty-handed.
Saving sales by pointing to merchandise locations is just one of the ways that store employees facilitate the sales process and perform a very important role. But in large retail enterprises, it’s easy for managers to ignore the details of sales floor interactions and opt for large-scale, broad-brush solutions to the challenge of staffing. Most simply set targets for store staffing levels they must maintain over time (mandating, for example, that the cost of labor cannot exceed 10% of sales), and then apply that level across the board. At best, they vary staffing levels based on sales forecasts. Almost invariably, such overall targets lead to a situation where some stores are overstaffed while others are understaffed.
Given today’s technology available for data acquisition as well as new developments in analytics, it is possible to do much better than this. Rather than simply predicting what volume of merchandise will sell in a certain period and scheduling more or fewer labor hours accordingly, it is possible to observe the actual flow of customers through stores and make adjustments—even in real time by moving additional employees to the sales floor or redeploying them to higher-traffic areas. Our studies have shown the wisdom of this: stores that manage labor levels in light of store traffic rather than sales forecasts achieve substantial sales increases without extra costs.
December 26, 2011 | Techmeetups
Original post by Anthony J. Bradley and Mark P. McDonald via HBR
Many of us in business have heard the popular aphorism, “People are your greatest asset.” Some of us may even believe it. But is this sentiment reflected in our corporate cultures and the way our leaders lead? For the most part, no — and there’s a reason for that.
People are not your greatest asset. Even great people are not your greatest asset. In fact, great people can be your greatest liability. If Enron wasn’t enough evidence of this, the 2008 financial crisis has now given us plenty more. What aboutLehman Brothers, AIG and Countrywide? Arguably, these companies employed some of the smartest business people not only in the room but in the world, and yet those same folks took their firms to ruin (or near it) and came close to causing a collapse of the U.S. economy.
So if it’s not people, what is your greatest asset?
It’s how you empower your people. Think about it. What is the primary purpose of a business organization? To assemble a group of people, who previously may have had no association, and empower them to accomplish productive work toward the organization’s objectives. More effective empowerment typically equals more productive work. As leaders and managers, we are familiar with empowering people. We organize them into divisions, units, groups and teams. We provide goals and incentives to motivate them. And we enable them with authority, tools, resources and processes.
Social media ushers in new ways to enhance your greatest asset, because it is about empowering people to collaborate at unprecedented scale. With powerful implementations of social media, we motivate people to form communities around a meaningful and common purpose . We enable them with new technology, seed content, and guidance on desired participation. The aim is to facilitate“mass collaboration” and its accompanying behaviors.
For our book on the social organization, we studied hundreds of social media implementations and identified a set of key mass collaboration behaviors. Understanding them is critical to successfully engaging and empowering people.
Collective intelligence is the meaningful assembly of relatively small and incremental community contributions into a larger and coherent accumulation of knowledge. Collective intelligence is not new, but the mass collaboration enabled by social media provides it at scales never before possible. Even the most modest individual contributions can be tremendously valuable when meaningfully combined at scale. Wikipedia, YouTube and Flickr are all social Web examples of collective intelligence. Each Wikipedia article by itself is relatively insignificant, but a million articles collected and linked together is highly powerful.
Expertise location involves seeking and finding specific expertise in the masses of people and the often-staggering amount of available content. One view of expertise location is almost the opposite of collective intelligence. It is “selective intelligence,” where the goal is not to collect numerous small contributions from many, but to find just what is needed. Crowdsourcing is a well-known example of expertise location.
December 23, 2011 | Techmeetups
Original post by JOHN COLEMAN via HBR
Last year, I was fortunate to moderate a fascinating panel discussion with Harvard’s Center for Public Leadership on the topic of “Next Generation Leadership.” One of the panelists, Rosalinde Torres, encouraged us to ask the following question: “What has made you successful in the past that you need to change to move forward as a leader?”
As we go through different phases in our personal and professional lives, we’re called upon to adapt, to marshal skills different than those we’ve used in the past. And in the modern world — where the pace of technological and social change is as fast as at any time in human history, those demands on our adaptability are greater. An exceptional grocery store cashier, for example, will need a different set of skills to be a store manager as her career evolves. And those in computer repair have had to learn and unlearn a myriad skills over the past 30 years to keep pace with the changes happening around them.
So what skills do you need to modify or leave behind to grow? For me, a few suggestions come to mind.
Stop seeking answers; start asking questions. In our 20+ years of education, we have been trained to get ahead by having the right answers — to tests, to class questions, to business problems. But the most difficult challenges require leaders who can identify and ask the right questions.
The world needs great problem-solvers, but it also needs people who can make sure their organizations focus on the right problems and miss nothing in the process. One of the more intellectually impressive senior executives I’ve worked with asked questions twice as often as he offered answers. As a result, the people who worked for him always took full responsibility for their work — because they knew they’d have to answer a stream of deep and thoughtful questions as soon as they entered the boardroom. This leader’s questions not only showed his thoughtfulness and helped drive deeper solutions, but they created ownership among the people who worked for him.
Focus on people, not problems. Junior businesspeople often work on heavily analytic, stand-alone problems. They’re asked to build models and plans — to find the “right” solution. But the most difficult problems can’t be solved and implemented by individuals alone. Good leaders can’t just get the right answer. They have to involve people — those who will ultimately implement their programs and those teammates who can help them solve the problem faster and better than they could on their own.
When an individual becomes too rigid about his or her “own” solution at the expense of working collaboratively with others, that individual often loses the momentum to generate change and misses the valuable insights of his or her peers in the process. A famous example of collaboration in the face of a difficult problem — no matter your thoughts on the project itself — is the Manhattan Project. The project, which ultimately led to the construction of the first atomic bomb, was led by General Leslie Groves. Knowing he couldn’t handle the project by himself (and neither could anyone else), he called upon as many great minds and competing perspectives as possible to come to the right solutions collaboratively and created an environment in which they could implement against that plan.
Stop working as a generalist. Many of us have lived life so far as generalists — “Jacks of all trades,” so to speak — focused broadly on a variety of skills, functions, or industries. Sure, we may have picked some topics on which to become knowledgeable, we’ve chosen professions, and we’ve completed “majors” or built specific skills. But by-and-large, we’ve cast our nets wide, learning broadly to gain context about the world around us. At some point, however, most of us will need to generate proficiency in a very specific topic, both because it makes us valuable sources of expert knowledge and teaches us the habits of mind to generate deep insight.
Take, for example, Steve Jobs’s early obsession with calligraphy. After dropping out of Reed College in 1972, Steve spent months immersed in calligraphy, which, at Reed, was an incredibly strong program. In his words, “I learned about serif and sans serif typefaces, about varying the amount of space between different letter combinations, about what makes great typography great. It was beautiful, historical, artistically subtle in a way that science can’t capture.” That experience not only helped Steve build the practical toolkit to create beautiful text and designs, but also improved and sharpened his mind, attention to detail, and his fascination with design.
December 23, 2011 | Techmeetups
Original post by ERIC LOWITT via HBR
While Black Friday and Cyber Monday were successful days for the retail sector, these two days alone are not a panaceato the sector’s performance challenges. Some retailers will continue this momentum. Others will not. The difference between the two sets of retailers? Knowing when and how to act as the water around you gets hot.
In our world, there are two kinds of frogs — those that jump out of the pot when it’s boiling and those that boil. Smart retailers jump out of the pot before it boils. They are keenly aware of changing conditions on the ground. And they don’t allow personal opinions about the cause behind the changing conditions to stand in the way of decisions and actions.
The global push to meet today’s needs without compromising future generations’ ability to do the same is one such boiling pot for retailers. Some are ignoring customer interest in all things environmental and social. Smart retailers, on the other hand, have realized the water around them is getting hot and they are proactively taking action. As a result, these retailers are cutting costs today, planting growth seeds for tomorrow, and setting the stage for accelerated strategic agility well into the future.
This is wisdom gained from studying hundreds of companies in support of my new competitive strategy and sustainability book, The Future of Value. Here are three of the most salient best practices of smart retailers from my research.
Margins in the retailing sector have long been razor thin. Since consumers have many retailers at which to shop, premium prices are quickly competed away. So retailers manage their supply chains and overhead costs with a tight fist. Smart retailers have come to view reducing their environmental and social challenges as another way to improve financial performance.
Consider Asda. The large UK retailer, owned by Wal-mart, lowered its 2010 expenses by over £70 million ($110 million) through energy and waste reduction throughout its retail footprint of 500 stores. The secret to the company’s success at cost reduction? It’s decision to view environmental and social actions not as altruism but as smart expense management.
December 22, 2011 | Techmeetups
Original post by MICHAEL LUCA via HBR
Yelp’s IPO filing comes hot on the heels of successful IPOs and high valuations for Angie’s List and Groupon. Yelp’s timing reflects both a tech-friendly market and the company’s current position as the dominant consumer-review web site. Yelp has 22 million reviews, and the supposedly imminent onslaught of competing review sites has yet to materialize. But is Yelp really poised for long-run success? My research shows that there are points in its favor — but there are others that should raise investors’ concern.
First, the positives:
Yelp works. Yelp is relevant only to the extent that it affects readers’ choices of where to go. The evidence shows that it does. In a recent paper, I combined Yelp ratings with restaurant revenues for every restaurant that operated in Seattle during Yelp’s entire run there. The data suggest that a one-star increase in a restaurant’s Yelp rating leads to a 5% to 9% increase in revenue. How do we know that it is in fact Yelp that matters, and not some other information source? To support the causal inference, I exploited the fact that Yelp rounds ratings to the nearest half-star. I found that restaurants receive a jump in sales after a rating is rounded up. So Yelp is driving sales, at least for independent restaurants. Positive ratings don’t help chain restaurants, which already have strongly established brands.
It gets its content for free. Even more impressive than Yelp’s impact has been its ability to generate 22 million reviews without paying for them. Yelp has been extremely effective at leveraging social incentives to make people work for free. It created a network of “elite” reviewers, whose reviews tend to be less erratic and closer to restaurants’ long-run averages. Yelp hosts special events to reward these prolific reviewers. It’s not clear whether upstart review companies would be able to replicate this excitement about reviewing.
Search is moving away from Google. Google recently acquired Zagat, creating a major competitive threat to Yelp. One concern is that Yelp will be hurt as it falls down the Google search rankings (and Yelp acknowledges that most of its search traffic comes from Google). When Yelp began in 2004, this would have been a devastating prospect. And to some extent, it still is. But new ways of searching for products may start to change this dynamic. For example, many people find restaurants on Yelp using smartphone apps, circumventing the standard Google search process. This trend will only increase with time.
Now the factors working against Yelp:
It’s easy to write fake reviews. Yelp and Angie’s List follow very different business models. Angie’s List charges readers to view its content, while Yelp’s reviews can be accessed for free (and the company makes money by allowing businesses to advertise). Angie’s List has a strict quality assurance process; Yelp lets virtually anyone review. The ease of leaving reviews on Yelp has led to a larger number of reviews, but it has opened the door for businesses to leave fake reviews — for themselves, their friends, and their competitors. In a world where we know who is writing the reviews (your Facebook friend, for example), this is not a problem. In a world where reviewers are fairly anonymous, it is.
Legitimate reviews may be filtered out. More worrisome than the fake-review problem is Yelp’s solution: It uses a program to filter out seemingly bogus reviews. This is fine, in principle. But it becomes more troubling when you look at the data. In a recent sample, nearly one out of every five reviews was filtered. Looking only at the five restaurants featured on the front page of Yelp’s Boston site, roughly 13% of reviews were filtered out. Worse, the reviews were filtered fairly evenly across the restaurants. This means one of two things: Either all five have been trying to game the system, only to be outfoxed by Yelp, or Yelp’s algorithm is so coarse that it wipes out a lot of legitimate reviews. While fake reviews clearly exist, it is unlikely that all of these restaurants have been trying to game the system. Combine that with allegations of Yelp sales staff’s being overly aggressive in pushing their paid offering, and Yelp’s filter can be all the more frustrating for restaurants. There is no evidence that Yelp favors advertisers, and related lawsuits have been dismissed. However, the filtering process does give credence to concerned business owners who note that legitimate reviews have been filtered from their restaurants.
December 14, 2011 | Techmeetups
Original POST by MARSHALL FISHER via HBR
This blog post is part of the HBR Online Forum The Future of Retail.
Retailers periodically update their product assortments, deleting slow sellers and adding new products in response to shifts in consumer demand or to accommodate new offerings from suppliers. Assortment-planning processes vary greatly across retailers and product segments but have one thing in common: They rely too much on human judgment and not enough on hard data that might allow a retailer to predict how customers will react to a change in the assortment.
This is the indisputable finding of research (pdf) that Ramnath Vaidyanathan of McGill University and I have conducted. Moreover, techniques that we have developed with several retailers over the last few years show that analytics are providing retailers a tremendous opportunity to improve revenues and profits.
Retailers who rely heavily on human judgment to make assortment decisions are flying blind, which leads to tales of woe like these:
- Walmart introduced Project Impact in 2008, an effort to ‘declutter’ stores by removing 15% of the SKUs they carried. It saw an immediate decline in sales and eventually had to roll back most of the changes.
- A grocery retailer deleted 20% of its dry-grocery SKUs to allow for expansion of fresh product offering. Sales declined 40% and the retailer is in bankruptcy. While all of the deleted SKUs had low sales, when customers couldn’t find them, they elected to shop elsewhere.
- A retailer of items for the home sought to localize its assortments by store. Out of the 35 categories it carried, it chose fashion bedding, designed localized assortments for five store clusters and was thrilled to see an 18% increase in revenues. It next applied the same process to fashion bath, got no revenue lift, and abandoned its localization effort.
These examples illustrate the need to answer several questions when revising assortments:
- How will sales change if we increase or decrease the number of products carried in an assortment?
- If customers don’t find their ideal product, what is the likelihood they will buy a substitute product?
- What’s the likely benefit of localizing a category? How many store clusters should we have? What are the right metrics to use in clustering stores?
- What are the likely sales of items we are considering adding to our assortment?
The technique that Ramnath Vaidyanathan and I developed answers these questions. We identify a few attributes for each SKU that are meaningful for customers, use sales of existing SKUs to estimate the demand for attribute levels, and then use the estimates to forecast the demand for any combination of attributes, including those that correspond to new products that might be added to the assortment. We have made this approach formulaic so you can sic a computer on your sales data.
December 12, 2011 | Techmeetups
Original POST by JOAN MAGRETTA via HBR
With Cyber Monday, the tablet wars kicked into full swing. Which one is the best? Is it the iPad? The Kindle? Who has the best technology? The best distribution? Who’s the best overall? For most people, “being the best” is what competition is all about. So General Motors CEO Dan Akerson was simply echoing popular sentiment when, on the day the new GM went public, he threw down the gauntlet: “May the best car win!” he told reporters. The phrase reflects an underlying belief about the nature of competition that feels so intuitively correct that it is almost never examined or questioned.
But if you want to win, says Michael Porter, this is absolutely the wrong way to think about competition. In fact, it’s practically a guarantee of mediocre performance. The first problem with the competition-to-be-the-best mindset is that, in the vast majority of businesses, there is simply no such thing as “the best.”
Consider a business as prosaic as seating for airport waiting areas. You would think that there would be a “best” here — standardized, functional seating. Well you would be wrong. Different airports have different needs. Some want waiting passengers to shop. They don’t want seats that are too comfortable. Some need the flexibility to reconfigure waiting areas. They don’t want long rows of fixed seats. Many airports have to watch their spending. But others — airports in the Middle East, for example — have snapped up luxury designs. Some airports value seats built to take extraordinary abuse. London-based OMK makes “prison-worthy” seating, the industry’s highest standard, using self-sealing polyurethane that can withstand a stabbing without showing the knife scar.
If there is no “best” airport seat, now think about all of the industries in the economy. In how many does the idea of “being the best” make real sense? The best hotel for one customer is not the best for another. The best sales encounter for one customer is not the best for another. There is no best car. There is no best art museum. No one best way to promote environmental sustainability.
Yet, it’s a pervasive idea. Management writers — and leaders seeking to inspire — regularly reinforce it by using colorful metaphors from warfare and sports. These lend emotion and drama to business competition. But, they are misleading.
In war, there can be only one winner. Not so in business, where companies like WalMart and Target can thrive and co-exist, each offering a different kind of value to its customers. In sports, there is just one contest with one set of rules. Not so in business, which is more complex and open-ended. Within an industry, there can be multiple contests, not just one, based on which needs are to be served. McDonald’s is a winner in fast food, specifically fast burgers. But In-N-Out Burger thrives on slow burgers. Its customers are happy to wait ten minutes or more (an eternity by McDonald’s stopwatch) for non-processed, fresh burgers cooked to order.
December 11, 2011 | Techmeetups
Elliot runs a startup company offering technology consulting and outsourcing services.
SKT’s innovative business model uses freelance resources for all the company’s software development requirements. They recruit freelancers on a per-project basis, giving SKT the flexibility to take on project work for web, mobile, Windows, HTML5… you name it.
While the company’s managerial structure remains the same and guides each project from beginning to completion, the developers are recruited individually and only for the life-time of one project. Elliot explains that relying on Elance has multiple benefits:
- Speed: if a client wants a project to begin on Monday, the Elance model allows SKT to recruit team members at short notice, sometimes within hours. This wins business and delights clients.
- Workforce flexibility: by recruiting developers per-project, SKT does not have to pay developers who are employed longer-term and would be left doing nothing between projects.
- Availability of resources: with Elance, Elliot is able to search far beyond his hometown for talent, ensuring he is able to place the best developers on the job, whatever the requirements of the upcoming project.
- Transparency: Elliot loves the fact that all freelancers on Elance are reviewed by their previous employers, leaving him confident that he has selected the best talent.
Elliot’s advice is that you should always interview the freelancer you are looking to hire to see if you can work together well on a personal level. For anyone that might be nervous about using Elance, Elliot says you must be rational and focus on your core business activities and outsource everything else that you can.
In turn, Elliot feels that although his clients do not use freelancers themselves, they are happy knowing that SKT fulfil their projects using a freelance workforce.
Further; Elliot also uses a virtual assistant for five hours a week which he sourced through Elance – it frees his time up completely. Recently Elliot needed some legal advice and using Elance found someone who could do a 2 hour project on the same day. So, in summary, he genuinely could not be happier with the choices he has made.
About SKT Consulting
SKT Consulting provide a combination of technology consulting and outsourcing services. Our guiding principle is simply to provide our clients with high quality technology solutions that are delivered on time and to budget.
Our services include Web / Software / Mobile App Development, High Performance Computing (HPC), Cloud Computing, Process Design and Re-Engineering, Program and Project Management, Technology Deployments and Migrations, Product Selection, Major IT Event Planning and Execution, Organisational Design and Change Management.
We work with clients from a variety of industries e.g. Financial Services, Media, Retail, Education and Charities. Our consultants have experience across a wide range of industries and sectors and as such are able to offer insightful advice to our clients based on their own hands-on experience.
Elance, the world’s leading platform for online work, helps businesses hire and manage in the cloud.
For businesses looking to staff-up a team on an hourly or project basis, Elance offers instant access to qualified professionals who work online. Elance provides the tools to hire, view work as it progresses and pay for results. Elance is faster and more cost-effective than job boards, staffing firms and traditional outsourcing.
For skilled professionals who want to work online, Elance offers access to qualified clients, a virtual workplace and guaranteed pay for great work. Contractors have already earned more than $450 million on the Elance platform.
The company is privately held and headquartered in Mountain View, California. To take advantage of the massive growth in demand for its services across the world, Elance opened European headquarters in Oslo. For more information, visit Elance at www.elance.com.
November 30, 2011 | Techmeetups