The power of Free

This video is great - it's a talk by Chris Anderson the editor-in-chief of Wired. He is the author of the much loved 'The Long Tail'. I found it the video on one of Guy Kawasaki's blogs.

His basic premise is this - there is a part of your business now which is a constraint that you have to pay for. What if that constraint wasn't there? What if you treated it as Free? What would that do to your market and your overall proposition?

It's a great talk given at NokiaWorld 2007 very well illustrated with lots of real examples from the Internet and telecommunications world (webmail and mobile in particular) and economics that anyone can understand.

There are a couple of conflicts in what he says (eg artists like Prince giving away music for free to create premium pricing for concerts - Chris hasn't commented on Prince taking legal action against his fans for the use of his likeness on fansites - maybe its another revenue model) and an unfortunate part of his talk where his PC SNAFUs without a graceful recovery.

Those are minor though - the premise is really powerful. Something that you think is a scarce resource, your competitor might be thinking is heading towards free. They act like it's free, you act like its a constraint. When that happens your world is going to get shaken up.

Of course you have to make the right part of your model free - sellmefree for example. There is no constraint for the audience on their primary competitor trademe. Sellmefree have made the wrong part of their model free as Lance and AirNZ have noted. It's free for anyone to browse and buy on trademe so the audience is there, which drives people to sell there. Virtuous cycle - boom.

It would be a bit different if there was no constraint for customers on the amount of a certain product to buy on trademe -and you could buy it at the price it just sold for on auction instantly - no such thing as missing out again. That would make it a meta-retailer (Sam Morgan's words - not mine) as opposed to community marketplace. Maybe the Ferrit model is not so bad after all? Especially when you look at the great deals they have on ipods now.

What would you want to see removed as a constraint now? How would you act if it was free?

Take 45 mins out to watch the video and have a think.

Agile Development

We've been working with a major international Systems Integrator and have been exploring the use of Agile Programming methods for a major (ie 12 month+) project.

While Agile has been well covered in other forums, one of the areas that I note is significantly underplayed is the amount of cultural change required moving from Waterfall techniques to Agile. In particular, I note that people from a Waterfall background *still* want to complete full requirements before moving into the Agile phase - it takes a lot of effort to let go of that security blanket. And on top of that, integrating Agile based deliverables into Waterfall deliverables seems to be left for others to discuss- maybe it's best not to consider that right now but seems like a recipe for failure.

So I was really pleased to see the Agile Barcamp wiki set-up from the session here in Wellington two weeks ago. I was disappointed I couldn't make that session as I was in Auckland that day (story of my life!) - however I have had the benefit of seeing the presentations uploaded now and can contact the people who wrote them and ask them how to integrate Agile and Waterfall. Fabulous.

Ironically (or otherwise) I've noted that a couple of Dilbert cartoons have focussed on Agile recently.

http://www.dilbert.com/comics/dilbert/archive/dilbert-20071126.html

Being in the camp of the business owner, I personally like this one.

I found this here http://cns2.uni.edu/~wallingf/teaching/agile/resources/dilbert-xp/

The end of the traditional kiwi closedown?

Like others in NZ I've been acutely aware of the skills shortage that we are facing - and I'm impressed that a number of employers are using what would be typically called the 'deadzone' to recruit new people to their team. This time of the year would normally be viewed as a waste of money to recruit talent as Kiwis have pretty much clocked off and wont be back en masse until late January.

Phil and Teds have bucked this trend with a major campaign to recruit what looks to be a wide range of talent for their team. This could be, of course brilliant timing and great execution - timing from the perspective of being able to run full page ads in what should be a cheaper window for traditional media without a lot of other clutter and execution in terms of the language and style of the campaign.

My only misgiving would be whether they hit the whole market (full page ad should sort that) and whether people have the headspace to dust off their CV a week before Xmas. My guess is, given how successful P&T have been this year that this is a well considered marketing campaign - hope they can turn interviews around this week for the sake of a couple of people who I know are applying.

Did this make the weekend agenda?

I am not a big fan of commenting on politics - I have better things to do.

It would be fair to say though that I am unhappy about the electoral finance bill and have been actively following David Farrar and Whaleoil for their views on this. They make me look like a fencesitter and certainly attract some criticism but I digress...

Another blog I have been following has been Dilbert - ironically it's been very active since Scott Adams announced he was going to blog less. He brought to my attention his own conspiracy theory based on a news item that Kangaroos fart less and this discovery will lead to some genetic modification of cows, reducing the methane being added to the environment.

Now given Kevin Rudd's first agenda item will be signing Kyoto, which Helen Clark and NZ have been a supporter of in recent times, I do wonder if this subject made the agenda over the weekend when the two leaders met informally - what an icebreaker!.

And being a guy I can't help but think there could have been hours rolling around laughing about the benefits (or lack thereof) of farting animals.

However I now realise that this would have been embarrassing all round once I reflect on the stereotypes. For one, no guy is going to be genuinely proud of not farting, hence Kevin Rudd would not bring up the point of his non-farting national icon. And no woman (well none that I know) would be genuinely proud of the animal which is creating her largest cash income having the socially (and politically) embarrassing habit of letting rip and hence making the world a more unstable place. So an opportunity to reduce greenhouse gases in the region is blown off as a result of gender stereotypes.

However the solution is clear - Helen and Kev have to swap countries - it's for the good of the planet dammit.

It's not supposed to do that

My mum still tells me that bad things run in threes - must be an Eastern European thing, as my Yugoslavian (is there still such a place?) godmother said the same.


This morning I got a run of three in about 4 minutes. Started off innocuously enough - riding my bike in on a beautiful warm and calm morning after a 5:20 am start to do some stretches. I was just coming off the Wellington motorway onto the Hutt Road when I hit some debris - back wheel kicked out a bit and a noticed that it had lost a bit of air.

I pulled over - back tyre definitely soft. Number 1. Take my pump off my bike to put some air in the tyre, hoping against hope that it was a slow leak and I could get into the office without changing the tube. I undo the valve on the tyre, clip the pump on and realise it's set-up for an MTB valve and can't put any air into the tyre. Off course, pressing the pump onto the valve meant all the air came out of the tyre. I turn to flip the fitting over on the pump. The lock nut is basically seized onto the pump due to excessive sweat corroding the aluminium so I can't change it over and the tyre is definitely flat. Number 2. So I decide to take the wheel off, change the tube and flag down a cyclist to use their pump. I release the wheel, and start to pull it off and notice there is a bit of resistance. I jiggle it around and give it a yank. The wheel is off - I look down and the derailleur looks like this picture. Number 3.




I think I have sheared the bolts off with brute strength - guy in the bike shop tells me the bolts are ok - just too short. Pretty sure I have been riding like this for about a year since i replaced the rear derailleur - fortunately I haven't been mashing the pedals :)


The bright side to this is at least 25 people stopped this morning to see if I was ok on their way riding into work. Nice one - thanks!

Corporate Blog Guidelines

I like this sensible advice from Lance Wiggs.

Keeps it simple, and has two basic themes

1. Blogging is a conversation - it's happening whether you are there or not. If you want to be part of that conversation then make an effort and be part of it!

2. If you're going to be part of it, be genuine. And you don't have to give your company secrets away to participate.

I know its common sense but sometimes that is a rare commodity in corporate land.

I've been interested in Paul Brislen's presence in various forums, in particular geekzone. I am sure that it makes those forums richer for the fact that Paul is out there with Vodafone's view on a regular basis. I do note that Paul doesn't have his own blog - any idea why that is?

Do what I say or what I do?

Had a funny experience today - was looking after Ella this afternoon. I changed her nappy and she was playing around in her room. I told her not to touch her nappy cream and less than a minute later this was the result - her lion Frankie had his rear end covered in aforementioned nappy cream....

So after I stopped laughing (ok it took a while...) I had a change to reflect on a couple of things.

1. I've been telling people for ages to keep their presentations short and to the point, and tailored to their audience. Yet on Friday I was involved in a team presentation that could be best be described as a powerpoint-a-rama that lasted 2 hours. Broke all the rules that I hold dear - pretty clear what the message is there to people who were unfortunate enough to be on the other end of that. Garr Reynolds would have had a field day.

2. Later on that day we had an activity that was designed specifically to relieve some frustration that is evident in the same team. We did not say what the purpose was - we just acted in a way that gave people the opportunity to genuinely express their concerns in an environment that was safe to do so. Much more effective that point 1 - no fanfare but the result has been enduring.

3. David Beckham - say what you like about him (and I'm a Spurs supporter - damn you Ricky Villa) but this weekend in Wellington he showed what a professional he is. Put himself out for his fans and made every post a winner. Even with bronchitis. Can't wait for the next Phoenix game already.

It didn't matter what I said to Ella - Frankie got his tail covered 'cos that is what happens to her and why should she act any different. No different in the other world.

Where there's a will, there's a way

I used to think that line was a pretty trite comment, but I had cause to reflect on a couple of very different experiences of late that show the power of personal will, and the need to take personal risk to make change happen. It's really important if you want to create powerful customer experiences.

1. I went to our call centres the other day to listen to why customers are calling us (as opposed to contacting us in any other way - btw the reason they do is they want trusted advice from human beings. I'm sure there are other ways to do this that have the human touch but I digress). We had a customer call who wanted to cancel broadband - he wasn't using it. Craig (the rep) could have just gone through the motions and cancelled it but decided to drop his success rate on call metrics and take 10 seconds to look at the customer's overall bill. This guy was spending $350 a month - mainly on domestic and Australian calls. So Craig asks if he wants to look at other options and ends up selling a plan which will probably cut $150 a month off his bill. Customer is stoked and casually asks about mobile - Craig ends up selling him a phone sight unseen which will completely suit his needs. Customer is still paying less per month and now has a great mobile - all because Craig took the personal risk to engage in a conversation that the customer hadn't initiated.

2. I've been shopping around our user-centred design methods internally and talked to a number of senior General Managers. The value of what I was talking about was recognised immediately - however there was no will to implement. I can understand resources are tight, deadlines are near - we've all been there. A will to implement would find a way to get around that.

I had to reflect on the second experience - a normal uncontrolled reaction would be to say 'pack of muppets - they don't get it' but I've realised that I've got to have the will to back up what I believe in and find a way to make it stick. Which means persistence and probably an alternative approach. Thanks Craig from the Helpdesk in Hamilton - you've taught me a great lesson.

Science backs up beliefs

I've been involved in an ongoing conversation for years now.

I believe that if you treat customers well, put yourself out for them even, your business will be more successful. Customers will come back. You'll make more money. Everyone will be happy.

Problem with this is that is a belief based statement. Pretty hard to run analysis other than belief based churn reduction. Numbers guys don't like that kind of thing.

The good news for people like me is that Telecom's new CEO is very clear that putting customers first is very clearly our number 1 objective. Made life a whole lot easier.

Ironically - after a day listening to Paul Reynolds and being dead impressed by his commitment to this approach, I found this piece of research entitled Happy customers provide higher returns and are lower risk.Who would have thought, huh? Will be one for the back pocket when the accountants come around.

I blinked

It's been 7 months since I last posted here.

It would be easy for me to say that I had got too busy to post anything and this whole blogging thing is just a fad, so why bother.

But that isn't the truth. The truth is that I blinked. In the face of some feedback I literally stood still and didn't move. I won't share that feedback with you - maybe you'll notice a change, maybe you won't. It's also critical to note that it was feedback - not an instruction. And my reaction was to treat it as an instruction.

My purpose with this blog is to share my opinions and positions on things that matter to me, that I care about. Note the use of the word 'my'. It's not Telecom's position, it may not be my colleagues position - it's my position. And its for you to comment on and contribute to. I don't really mind if you flame me either - the point of this is to open up the debate on issues, provoke some discussion, and learn something that we didn't know before.

My view on this is simple - I am brave enough to share my opinion here. If you disagree with it, I'd ask you to be brave enough to tell me your counter opinion. Even better, do it as a comment here so we can do something positive with it.

Sprung on the 'net

So I've been 'found' on the 'net. Juha Saarinen - a regular contributor to the media landscape in NZ on all things telco and internet based has tracked down my very poorly updated blog and made some very pertinent comments about a couple of things in the piece.

1. Why does Telecom not have a Corporate Blog?

This is a funny one as last year Theresa got a few random people together to get their opinions on how we could get our people better engaged with the direction that we are taking. I was pretty adamant (in a 2006 kinda way) that a blog that was written by TG (ie NOT ghost written) would be a great way to go. It would take some investment and discipline but would be a great way for Theresa to get her message out. Her biggest issue was the supposed lack of authenticity of this medium. I have to say, based on a couple of comments I have received on this blog, that a direct way of commenting with her people (and I use that word in the broadest sense to include her staff, customers and broader stakeholders in NZ) would be a great way to gauge public sentiment and to explain why we do some of the stuff we do. Doesn't make it right or wrong but it most certainly means that you get your message out.

2. Juha thinks I should relax a bit

I must ask him about this as it could mean a couple of things

a. I am being too earnest in what i talk about (very possible)
b. I need to be more overt about my real opinion

This second bit is a little more problematic - and cuts to the core of this media - how do I express my opinion about something that pays for my family to eat (without being too dramatic). I guess the only way to do it, is to do it - so I'll be testing this boundary and seeing how my buddies react. A few of my posts have been too veiled which leads to the next point...

3. A commentor on Juha's blog, Michael, posts that I am a representative of another type of employee

The new generation of institutionalisation is the opposite - excited, passionate believers but so deep in their own corporate culture ("drinking the Kool-Aid") they can't see outside the walls or can't truly empathise with customers.

This had me more concerned that anything else as the thing I truly believe in is that for Telecom to survive (let alone succeed) that empathy with what customers really want is needed. I have an opinion that lots of people join Telecom for a whole lot of good reasons about how they can improve the lot of Telecom and its customers. But when they get in there, the path of least resistance kicks in and they find it easier to ensure customers don't leave us as opposed to make things so good that customers want to stay. You might think that is a subtle distinction but it's massive. And its time that it stopped. My response to Michael's comment is what I am doing to make that change stick.

Which leads me to the proposal on Friday for structural separation. There are lots of good reasons why you might want, as a shareholder, to keep Telecom in one piece. But there are a hell of lot more for splitting it off. Over and above the cost of making it happen (just think number portability x 10 - and its interesting to see that only one party has got that deployment right). One of the most important is that it would completely remove the temptation to try and 'game' the system. And I think that it would completely drive the right market behaviours like the following

A. The Network business would be solely responsible for building and maintaining bandwidth. Nothing more, nothing less. Its a big enough job that is fairly capital and resource intensive and if you got the right structure in place (ie must only ever be a wholesaler, never retailer ; ideally separate ownership) then you'd have some pretty good conditions that would work for the whole industry. And don't underestimate the issue about being able to make a reasonable rate of return - that would have to be directly linked to re-investment.

B. It would remove a huge constraint from the Retail side of the business. It's funny - you look around the 'net and see all the suggestions that people make for what Telecom could do and you realise being inside the business that if you didn't have to spend all your time lining people up to get commonsense stuff done that there are huge gains to be made in terms of innovation and Innovation (purposefully distinguishing between the 2). My own personal preference is for Retail units not much more than 100 people in size with truckloads of non-core services outsourced, running on a very lean internet based model with the same flexibility of our competitors. Would probably make some of them who used to work here a little uneasy if they knew we had the same nimbleness that they enjoy.

Looking forward to seeing how the market reacts but TUANZ's reaction was a very pleasant surprise. Some leadership here is great to see, especially when you wouldn't pick many bold moves with only 2 months and a bit to go until Theresa moves on...

Claim this place

We've just opened up a new project office in Auckland for the work we are doing - I think this is an incredibly symbolic time for us. Here are some thoughts that I sent to Pawel to show what this means to me


This is a landmark time and place for us.

This is where we start to design the future. If we use the metaphor of the Kiwi Explorer this is our shed, our garage, our kitchen table. This is where we pore over our plans, covering off every uncertainty and trying to find the best way to make our quest happen.

If we were Edmund Hillary this maybe where he kept his bees, thinking about the mountains he might climb before he attempted Mount Everest. If we were Sir Peter Blake, this is the boat building yard where we tested ideas about new boat shapes, sail types and nutrition plans before we set off to San Diego to win the America’s Cup. Closer to home, if we were Kevin Biggar, this is where we would weigh every item we had and decide we really only need half a toothbrush while we were rowing across the Atlantic. Further away, this is the garage in Palo Alto where Steve Jobs and Steve Wozniak designed their first apple computer. This is our beginning.

This is a place about ideas and debate – where we are safe and free to challenge each other about whether what we are doing will really deliver on our dreams of running a lean business that will deliver product innovation in the eyes of our customers and a service experience that is unparalleled in the NZ business.

This is a place where we find out about what is inside us – for it is only by unleashing the capability that is inside us that will deliver on this dream.

It is a place where we will stand strong and united – for it is only as a team that we can achieve what we set out to achieve.

And it is a place about hard work – this is place where we do the preparation – the training, the theory, the mini expeditions to prepare us. This hard work is in the pursuit of an audacious dream that perhaps no-one thinks is possible other than us – and those are the best type aren’t they?

We will have our first reward in June when we will have completed our design for this new business. Until then I encourage you to ‘claim this place’ as ours. It is the place where we design our dreams – where we design a business that will be the future of Telecom, the future of its customers, and it will be a defining point in all of our careers. Our first challenge is to make this place tangibly different from what we have come from. I encourage you to do that – make it special. See it as our first test of doing things that are leaner, innovative and customer focussed.

Building a new business is hard work...

And that's not exactly a surprise is it. Thinking about where we are now in our project to build a new retail business vs. where I thought we could be by now, it's a hell of a lot harder than I thought.

So even if you are well funded (which we are) this building new business thing is not a walk in the park. In fact I think there would be some serious side benefits to not being well-funded - for one the fear that every EFTPOS transaction might be your last would certainly provide some more fundamental motivation to get stuff done faster.

Here's a top 5 list of why it's harder than you think.

1. You only know where you're going when you get there

Things change so much that you can only really ever have a general idea of where you might end up. Sure it's exciting - trying to keep people rolling with it is not that easier. How Columbus did it I have no idea.

2. You need to know everything

You might be able to delegate stuff to experts but really it all falls on you - especially if your business is about delivering roughly the same stuff in a different way, you HAVE to know if the different way is going to work. For someone who doesn't do a lot of detail, this means a lot of learning

3. No-one from the normal world gets it

People want to know why you're working insane hours, are always pre-occupied and telling them 'I'm coming up with a new business model that customers will love' will at best get you a quizzical eyebrow raise

4. Always challenging can turn into self-doubt

Building something new, you have to continually challenge what you're doing before you burn a lot of cash - people in your team who aren't used to this will turn this into self-doubt. Not a good thing.

5. Some days you're just surviving

I'll use an ocean-going analogy again. You get hit with 40 ft waves in your wooden ship sailing to the other side of the world you don't really care if you're still heading in the right direction - you just want to be alive. Sometimes you have do stuff for survival that won't take you in the right direction - not much you can do about it.

There's a heap of good things as well - they're well documented - it's how you get through the tough stuff that determines whether you'll be successful. Everytime I think about those pioneers who set out with literally nothing (Shackleton, Cook, Columbus, Erik the Red) combatting the best that Nature could throw at them, and generally heading in a direction where they didn't know exactly what they would find- sheesh, they did it tough. We've got it easy....

Great article on customer immersion

Excellent follow-on article from previous post about the need to talk to customers. This is the next step in our customer experience work. Thanks to Lynsey for the pointer

Resumption of service

And we're back for 2007 - been a long break between posts. And a chance to think about what I'll be doing for the coming year.

Only made one New Year's resolution - to start a revolution that will create a truly customer focussed business here at Telecom . Arlene thinks I am crazy but it's the one thing I really care about from a work perspective. I have lots of theories about why it isn't customer focussed currently- most are best left for a beer conversation as they tend to focus on what's wrong as opposed to how do you design a new future.

I've been working on this 'revolution' for a while now and thought that last year it had come to a grinding halt. We had an opportunity to pitch some of the work we have been doing around customer experience design to the Exec via a couple of GM's - in short I screwed up. Tried to make it too much about 'hey- this is cool. We're designing stuff. We never design stuff.' It came across as self-serving and I really thought I'd blown the chance for the team to get the right skills and resources on board to make sure we really design from the customer in. Spent a couple of weeks beating myself up about it as well.

The good news is that we had an opportunity for another part of the team to pitch this direct to the Exec and we reframed the story completely. Al and Dale took the exec through customer personas, showed how we use these to create options to meet customer needs and then tied this together in a way that hit what the Exec want to see - by designing from the customer in you can create a lean, low-cost organisation as you design out all the un-necessary contact customers have with you when things don't work. Exec love it, and we now have the resource we need to really design a world class experience. And to top it off, I've learned my lesson (again?) about the need to pitch it to the audience in a way that works for them.

revolution started.....