10 Management Lessons

Over the past five years, as iContact and Virante have grown, I've learned a lot about managing people. A business amounts to little without the people behind it. The two most important things I look for when hiring are initiative and work ethic. I cannot overestimate the importance to the eventual success of your business of bringing on good people. But once you have hired these good people, how do you manage them?

I certainly admit that I have much left to learn about leadership and management, but here are a few tips that might be helpful:
• Have a vision and communicate it. Make sure you clearly communicate your vision for the company. No one follows a leader who cannot communicate the way in which the company will succeed. The future of all your employees is tied closely to the success of your company. Make sure they believe in your company, what it stands for, and its products and services, and make sure they know that the hard work they are putting in now will payoff.
• Show respect. Treat people, including your customers, suppliers, partners, and employees, with respect at all times.
• Share your success. Make sure your employees share in the success of your company. As the company is able, provide additional benefits such as health care and dental coverage, a stock options plan, and a 401(k) plan. As your employees' skills and abilities grow, reward them with fair compensation. Finally, consider incentivizing your top employees and managers with ownership in the company. Few things can make a person work harder than a piece of the action

• Don't be too serious. Make the business environment fun at times. While being professional and taking things seriously is important, nothing can beat the effects of a companywide midnight round of bowling after you reach an important milestone, a lunchtime pizza party once a month, or a spontaneous Nerf-dart duel.

• Work with your employees. Make sure the employees see you there and working with them. No one likes to work hard for someone who doesn't work hard him—or herself. Especially early on, be the first to arrive and the last to leave whenever possible.
• Keep your door open. Whether or not you have your own office yet, keep your "door" open. Make sure your employees and managers know that you are approachable at any time about any problem they are having.
• Listen. You have built a great team and are paying top dollar for it. Hold meetings with your management team at least every other week. Also have frequent informal ad hoc discussions with your partners, managers, and employees. Get their feedback, discuss the business and its strategy, and inquire every so often if there is anything that is frustrating them that you can help with. A few weeks ago I had a quick spur-of-the-moment meeting with the lead developer for iContact. After inquiring whether he had any job frustrations, it came out that he felt he was working in an environment in which he became distracted too often. We quickly devised a solution whereby he would work at home four hours a day until we could move into a larger office where the development team could work in a separate room, away from the distraction of the sales and support team. This small change has doubled the developer's productivity.
• Build relationships. Without understanding at least the basics of what is occurring in an employee's out-of-office life, it can be hard to connect with the person on a professional level. One tactic I've used successfully to get to know each employee personally is to take the person and his or her significant other to dinner the first evening of their employment. It serves as a way to celebrate the occasion as well as learn a little bit about the employee that would not come out in interviews or through reading a resume.
• Commend more than you criticize. Too many business owners (and I have been guilty of this as well) speak to an employee only when he or she has done something wrong or something that has negatively affected the company. While constructive criticism and appropriate guidance have their place, if you seem to only condemn and never praise, your employees will quickly either dislike you or show apathy toward their jobs. Continual properly placed praises can be as powerful in getting quality results from employees as a large pay raise. Many people thrive on peer and superior recognition just as much as on money. Instituting an employee-of-the-month award and a quarterly performance review can be extremely valuable to your company.
• Consciously build a culture. At iContact, we truly are a family. In fact, we call ourselves the iContact Family. When someone is moving into a new house or needs a ride home from the airport, we're there to help. We believe in building people up, not tearing people down. We put people first and have respect for the individual. We believe that we should work hard and be innovative, yet maintain a balance in our lives. We believe in not letting balls drop, and that we're all working together on the same mission. We have foosball and Ping-Pong tables in our office, free sodas, Bagel Monday, and monthly birthday celebrations and Outstanding Performance Award ceremonies. We have a young, dynamic, fun, and innovative culture. It exists because we have consciously built it.

As a manager and business owner, you are charged with an immense responsibility. You control the activity and purpose that your employees dedicate half of their waking hours to. Make your company's purpose meaningful, communicate your vision, respect and praise your employees, and share your success. If you can succeed in building a team of highly motivated and happy employees who take initiative, have a bias toward action, respect you, and truly care for the business, you will have done much of the work toward building a strong and fast-growing organization.


(From : An excerpt from Zero to One Million (McGraw Hill, $16.95)
By Ryan Allis ,
http://www.managesmarter.com/msg/content_display/resources/book_store/e3ica0ebb59d5d28e8c2fb17c45a3de192e)

How to Enjoy Your Successes

Success That Lasts
(Key ideas from the Harvard Business Review article by Laura Nash and Howard Stevenson)

The Idea
Chasing after success is like entering a landscape of moving targets: Every time you hit one, five more pop up from another direction. There’s always more work to be done, more money to make, a bigger house to buy. Is it any wonder we’re stressed?

To get a fresh perspective, think about success in terms of its four distinct components: happiness, achievement, significance (positively affecting those you care about), and legacy (helping others find future success). Unless you regularly hit on all four categories, any one win will be unsatisfying. So instead of relentlessly pursuing one goal (be it making partner by 30 or being the world’s best soccer mom), focus on racking up victories in all areas. To maintain a steady flow of wins, however, you’ll need to set limits on the time you spend on any one activity. In other words, you’ve got to figure out how much is “just enough”—the amount you need to accomplish before you feel comfortable putting down one task and moving to another.

Real success is emotionally renewing, not anxiety provoking. By actively making choices and setting limits, you’ll be able to reach your goals, tally up more “wins,” and truly enjoy all the successes you achieve.

The Idea in Practice
GoTo http://hbsp.ed10.net/r/02T8/UTWN3/FX0BTW/ZBK0U/FEW7O/B7/h

Straight from Hollywood: The Project-Based Workforce

Straight from Hollywood: The Project-Based Workforce
Posted by Tammy Erickson on January 29, 2008 9:13 AM


A number of years ago, when my colleagues and I first began our research on how companies were preparing for the changing demographics of the workforce, we were amazed to find 85-year-old aerospace engineers successfully at work! From a company perspective, the reasons for this were straightforward -- the industry was then already faced with a severe talent shortage. But why were these folks happily devoting their golden retirement to work?

Today, it’s clear the answer to that question has two important components. First, lots of people are finding that they want to work “forever”-- that the benefits of intellectual stimulation, social interaction, physical activity, and, of course, supplemental income, are ones they value more than endless rounds of leisure activity.

Today, more than three-quarters of adults approaching retirement say they plan to continue working in some capacity.

But the second reason is important, too -- companies are beginning to offer a wider array of flexible arrangements that make it easier for individuals to create a life that includes both leisure and work. The aerospace engineers we met some six years ago were not working full time. They were working “cyclically” -- full time on for 3 or 4 months, then fully off for an equal or longer period of time.

Over the next several decades, as more sectors face the looming talent shortage, there will be a rapid increase in the number of people who work in cyclical or project-based arrangements -- many with no fixed affiliation to one corporation. It’s even possible that project-based work will become the norm in several decades -- with most workers operating as what some have called “intellectual mercenaries” assembled by project, as needed.

Consider the film industry. In the days of Marilyn Monroe and Humphrey Bogart, actors (as well as directors, camera men, and all others required to produce a moving picture) were employees of the studio. Today that is far from the case. Studios have become, in essence, financing and distribution vehicles for project-based endeavors, with the producer (also often independent) assembling a unique cast and crew for each film. It is likely that some form of this model will come to many of our industries over the next decade or two.

Already, nearly half of U.S. workers of all ages who plan to work during traditional retirement years say that they would prefer cyclical arrangements -- periods of full-time work interspersed with periods of no work. These focused periods of time allow individuals to work hard for a period of time (with one employer) then move on to another work period with a new employer, or to a period of leisure, learning, or other pursuits. Conventional part-time arrangements, working part of a day or part of a week, are popular, too – 39 percent like this idea – but less so than cyclic, which allows a different pattern of flexibility.

Both businesses and individuals need to learn to cycle. Organizations need to begin today to create cyclic job options. Individuals should get ready to work this way. Workforce Crisis, our 2006 book, is designed to help companies put this new approach, and other innovative ways of attracting and retaining talent, in place. My next book, Retire Retirement: Career Strategies for the Boomer Generation, is written for individuals -- to help those of you who are planning to make a transition from your “first career” to whatever this second work phase might hold.
How can you put yourself in a position to be a cyclic worker? There are important steps you can take today learn to cycle -- to prepare yourself to land your ideal “second career” situation after “retirement.” If you’re in or nearing retirement, jump on the bike.

• Build and refresh your network
• Clarify and renew your personal brand. Discuss the strongest attributes of your current reputation with a career counselor or trusted coach. Develop a strategy to evolve it toward your “second career” aspiration.
• Stay up to date on the latest thinking in your area of expertise.
• Renew any relevant certifications or licenses. One of the outcomes of increasing cyclic work will be the growing demand for certification, whether to establish cross-company norms or internally, as part of as process of validation for executive readiness. Consider working within your profession, industry, or skill base to establish cross-company certifications that will quickly and easily communicate to others your degree of proficiency in a given field.
• Create the context for discipline. Arrange a home office or other suitable work space. Identify options for appropriate professional support. Working cyclically, you have to manage, not just doing the work, but marketing and selling your skills, customer service, and all the invoicing and collection issues.
• Develop a disciplined schedule. The most difficult part of cyclic work is getting so immersed in one cycle, that you spend no time or thought on the next. Set aside time each day, or at least each week, or focus on “what’s next.”

And remember, “what’s next” for you is likely to be very different than the typical life 70 or 80-year-olds have led in the past. Those cycling aerospace engineers were having a great ride.

(From: http://discussionleader.hbsp.com/erickson/2008/01/draft_for_jan_30_learn_to_cycl.html?cm_mmc=npv-_-listserv-_-FEB_2008-_-finacctg)

Microsoft readies assault on Yahoo board

Microsoft readies assault on Yahoo board

Like a lion chasing a weakened gazelle, Microsoft knows it will capture Yahoo eventually. The challenge now is to do it as quickly and painlessly as possible.

To that end, Microsoft (MSFT) is moving in for the kill. The software giant is poised to take its takeover bid of more than $40 billion directly to Yahoo (YHOO) shareholders, overthrowing a Yahoo board of directors that dismissed the offer as too low. Microsoft executives hope that by forcing a shareholder vote, they can get speedier regulatory approval and avoid having to fork over billions more for Yahoo.

Microsoft would not officially comment about its next moves. But the company has retained a proxy firm to round up shareholder support, and a source familiar with the company’s plans said Microsoft is indeed preparing to replace Yahoo’s board and smooth the way for a takeover.

The bid for Yahoo comes because Microsoft believes that together the two companies can mount a challenge to Google (GOOG) in online advertising. Today Google is by far the top company in search advertising, and with its pending purchase of DoubleClick, it stands to dominate display advertising as well. Microsoft insiders say the Yahoo purchase is the company’s best chance to slow Google’s momentum and rally enough engineers to out-innovate the search juggernaut.

But will Microsoft still have to raise its bid to get Yahoo? The company is doing its best to avoid it. Microsoft Chairman Bill Gates pointed out that Yahoo hasn’t gotten any better deals, telling the Associates Press this week: “We think that’s a fair offer. They should take a hard look at it.”
Indeed, Microsoft has a lot to lose by raising its bid too far. Even offering an extra $1 per share would cost about $1.4 billion, whereas waging a proxy fight would cost only about $30 million, one insider said. And since some large Microsoft shareholders already feel that the company is overpaying for Yahoo, it’s no surprise that executives aren’t waving more dollar bills around.

There’s still a good chance that Microsoft will end up paying a little bit more before the Yahoo deal closes, but there’s an art to these negotiations. If Microsoft offers to raise its offer too soon, it risks getting into a bidding war with itself — Yahoo shareholders might hold out in hopes of squeezing out a few more billion dollars. But if it waits until the deal seems sure to close and then sweetens the bid, Microsoft could end up looking like a benevolent conqueror.

It could be good for Microsoft to raise its bid at least a little, and leave Yahoo shareholders and employees with something extra to feel happy about. And it’s worth noting that for all the bluster, Microsoft hasn’t ruled out paying a little more to seal the deal.

(February 19, 2008, 7:19 pm from "BIG TECH, Covering the digital giants, By Jon Fortt
http://bigtech.blogs.fortune.cnn.com/)

Process Classification Framework (PCF Model)

APQC and its members developed the PCF, which is updated by a global advisory council of industry leaders.

As a common language, the PCF allows organizations to see and discuss their activities from an industry-neutral viewpoint.

Regardless of size, industry or geography, organizations can use the PCF to benchmark and improve processes.

The PCF organizes operating and management processes into 12 enterprise-level categories, including process groups and more than 1,500 processes and associated activities. Organizations can then talk specifically about the exact same activity and know what specifically is included in that activity.

(Fr0m : The APQC Process Classification FrameworkSM (PCF) , http://www.apqc.org/portal/apqc/site/?path=/research/pcf/index.html )

10 trends that will tranform IT over the next 5 years

Gartner released the list on January 31, and it stated, “The full impact of these trends may not appear this year, but executives need to act now so that they can exploit the trends for their competitive advantage.”

The list was compiled from over 100 predictions that Gartner made over the past year and then narrowed down and summarized into this list of 10 trends for IT departments to watch. Here’s a quick summary of the 10 along with my take on each one.

1. Mac will double its market share
Gartner says: “By 2011, Apple will double its U.S. and Western Europe unit market share in computers. Apple’s gains in computer market share reflect as much on the failures of the rest of the industry as on Apple’s success. Apple is challenging its competitors with software integration that provides ease of use and flexibility; continuous and more frequent innovation in hardware and software; and an ecosystem that focuses on interoperability across multiple devices (such as iPod and iMac cross-selling).”

2. Half of business travelers won’t take their laptops
Gartner says: “By 2012, 50 per cent of traveling workers will leave their notebooks at home in favour of other devices. Even though notebooks continue to shrink in size and weight, traveling workers lament the weight and inconvenience of carrying them on their trips. Vendors are developing solutions to address these concerns: new classes of Internet-centric pocketable devices at the sub-$400 level; and server and Web-based applications that can be accessed from anywhere. There is also a new class of applications: portable personality that encapsulates a user’s preferred work environment, enabling the user to recreate that environment across multiple locations or systems.”

3. Open source will penetrate 80% of enterprise software
Gartner says: “By 2012, 80 per cent of all commercial software will include elements of open source technology. Many open source technologies are mature, stable, and well supported. They provide significant opportunities for vendors and users to lower their total cost of ownership and increase returns on investment. Ignoring this will put companies at a serious competitive disadvantage. Embedded open-source strategies will become the minimal level of investment that most large software vendors will find necessary to maintain competitive advantages during the next five years.”

4. A third of all software purchased will be by subscription
Gartner says: “By 2012, at least one-third of business application software spending will be as service subscription instead of as product license. With software as service (SaaS), the user organization pays for software services in proportion to use. This is fundamentally different from the fixed-price perpetual license of the traditional on-premises technology. Endorsed and promoted by all leading business applications vendors (Oracle, SAP, Microsoft) and many Web technology leaders (Google, Amazon), the SaaS model of deployment and distribution of software services will enjoy steady growth in mainstream use during the next five years.”

5. Many new businesses will buy IT infrastructure as a service
Gartner says: “By 2011, early technology adopters will forgo capital expenditures and instead purchase 40 per cent of their IT infrastructure as a service. Increased high-speed bandwidth makes it practical to locate infrastructure at other sites and still receive the same response times. Enterprises believe that as service oriented architecture (SOA) becomes common, “cloud computing” will take off, thus untying applications from specific infrastructure. This trend to accepting commodity infrastructure could end the traditional “lock-in” with a single supplier and lower the costs of switching suppliers. It means that IT buyers should strengthen their purchasing and sourcing departments to evaluate offerings. They will have to develop and use new criteria for evaluation and selection and phase out traditional criteria.”

6. Power efficiency will become a key criteria in IT purchases
Gartner says: “By 2009, more than one third of IT organizations will have one or more environmental criteria in their top six buying criteria for IT-related goods. Initially, the motivation will come from the wish to contain costs. Enterprise data centers are struggling to keep pace with the increasing power requirements of their infrastructures. And there is substantial potential to improve the environmental footprint, throughout the life cycle, of all IT products and services without any significant trade-offs in price or performance. In future, IT organizations will shift their focus from the power efficiency of products to asking service providers about their measures to improve energy efficiency.”

7. CO2 footprint will become part of PC purchasing criteria
Gartner says: “By 2010, 75 per cent of organizations will use full life cycle energy and CO2 footprint as mandatory PC hardware buying criteria. Most technology providers have little or no knowledge of the full life cycle energy and CO2 footprint of their products. Some technology providers have started the process of life cycle assessments, or at least were asking key suppliers about carbon and energy use in 2007 and will continue in 2008. Most others using such information to differentiate their products will start in 2009 and by 2010 enterprises will be able to start using the information as a basis for purchasing decisions. Most others will stat some level of more detailed life cycle assessment in 2008.”

8. Green sourcing will drive vendors to provide green credentials
Gartner says: “By 2011, suppliers to large global enterprises will need to prove their green credentials via an audited process to retain preferred supplier status. Those organizations with strong brands are helping to forge the first wave of green sourcing policies and initiatives. These policies go well beyond minimizing direct carbon emissions or requiring suppliers to comply with local environmental regulations. For example, Timberland has launched a “Green Index” environmental rating for its shoes and boots. Home Depot is working on evaluation and audit criteria for assessing supplier submissions for its new EcoOptions product line.”

9. End user preferences will drive half of all IT purchases
Gartner says: “By 2010, end-user preferences will decide as much as half of all software, hardware, and services acquisitions made by IT. The rise of the Internet and the ubiquity of the browser interface have made computing approachable, and individuals are now making decisions about technology for personal and business use. Because of this, IT organizations are addressing user concerns through planning for a global class of computing that incorporates user decisions in risk analysis and innovation of business strategy.”

10. 3D printers will grow 100-fold
Gartner says: “Through 2011, the number of 3D printers in homes and businesses will grow 100-fold over 2006 levels. The technology lets users send a file of a 3D design to a printer-like device that will carve the design out of a block of resin. A manufacturer can make scale models of new product designs without the expense of model makers. Or consumers can have models of the avatars they use online. Ultimately, manufacturers can consider making some components on demand without having an inventory of replacement parts. Printers priced less than $10,000 have been announced for 2008, opening up the personal and hobbyist markets.”

(From: Sanity check: 10 trends that will tranform IT over the next five years
Date: February 18th, 2008
Author: Jason Hiner http://blogs.techrepublic.com.com/hiner/?p=595&tag=nl.e101 )

Leadership Development in 2008

Leadership Development in 2008
by Josh Bersin

Leadership development continues to be one of the fastest-growing areas of corporate training. Spanning programs from management training to executive development and cultivating high potentials, leadership development consumes almost 25 percent of all corporate training dollars. Today’s emphasis on building the leadership pipeline makes this investment more important than ever.

After two years of research, we have found six best practices common to highly successful leadership development initiatives.

1. Strong executive engagement: The most important practice of all is to obtain the engagement of top leaders and managers. Their commitment means that the program will be highly regarded, aligned with corporate strategy and focused on the right business issues. At Textron, the top leadership team participates in each major element of the leadership development program.
2. Tailored leadership competencies: Successful leadership development programs are based on identified leadership competencies. By isolating and agreeing upon leadership competencies most important to your business, you will have the foundation for leadership development, as well as succession planning, career development and other talent-related processes. All high-impact programs we’ve studied are built on well-established leadership competency models.
3. Alignment with business strategy: Leadership development is far more than management training. As leaders move up in the organization, their skills must shift from people and project management to strategic business and operations management. Organizations such as Agilent, Aetna and Cisco focus heavily on company-specific business strategies in their leadership programs. Such programs cannot be totally comprised of off-the-shelf content. Furthermore, leadership development programs must be included in business conversations and planning. At New York Mellon, the top 10 executives meet quarterly to review the efforts of the leadership development group and how it is supporting the company’s current business initiatives.
4. Target all levels of leadership: While the term “leadership” may not seem to apply to first-line managers, we find that high-impact programs have elements that apply to every level of management. At Shell, line managers participate in a program called Shell Life, which includes basic training in coaching, change management, delegation and development. Functional managers participate in a program that focuses on business leadership, business management, vision and other leadership qualities. Also, top business leaders are involved in a third program, which focuses on Shell’s business management and uses external education and consultants to train top global leaders.
5. Apply a comprehensive and ongoing approach: No sound leadership development program consists solely of an instructor-led training event. Programs must include developmental assignments, 360-degree assessments, meetings with global counterparts, case studies, external education and a wide variety of e-learning and other media to give leaders a complete experience. People learn to lead by doing, so the best leadership development programs focus heavily on experiential learning.
6. Integrate with talent management: To build a sustainable leadership pipeline, organizations must implement programs to assess leadership potential (part of the performance management process), identify successors to existing leaders and place these individuals into the right development programs as part of the company’s regular business practices. In fact, one of the biggest indicators of a first-class leadership development program is a set of established practices and a corporate culture that encourages development throughout the enterprise.
Those companies with weak leadership pipelines could well suffer in the years ahead, when talent grows increasingly scarce. I encourage you to think about leadership development initiatives and these six practices as you plan for 2008.


( From: Best Practices - Josh Bersin
Published February 2008;http://www.clomedia.com/best-practices/josh-bersin/2008/February/2063/index.php)

The Courage to Reach Your Goals

The Courage to Reach Your Goals By Donald J. Trump


Winston Churchill was a great orator, but I read that he spent a lot of time developing this skill. He wasn’t a natural in the beginning, but he worked at it until he mastered it. He became a powerful and mesmerizing speaker. One of his most famous speeches during World War II included these words:

Never, never, never, never, never, in nothing great or small, large or petty, never give in, except to convictions of honour and good sense. Never yield to force; never yield to the apparently overwhelming might of the enemy.

Churchill and his people were in danger of being bombed out and overrun by the German military when he said that. You might not be experiencing the blitz, but you can still apply those words of courage to your daily life. There are days when I have so many problems come at me at once that it can seem like the blitz. I don't give in to them, and neither should you--ever!

Moreover, goto http://www.trumpuniversity.com/connect/newsletters/itt/issue102.cfm#3 .

Creating Innovation

Research by IBM Global Business Services, Innosight and the benchmarking organization APQC has shown the fallacy in the assumption that successful innovation will come simply by replicating the approach used by successful innovators. A survey of 90 companies across a variety of industries and 14 countries shows that the sourcing, shaping and implementation of ideas at innovative firms tends to conform to a small number of innovation archetypes. These different “builds” represent a self-reinforcing combination of culture and operations. Google is representative of one of those models, but only one. Because there is no single archetype of innovation, companies get into trouble by trying to replicate characteristics that are not “natural” to their own business. Instead, firms should recognize the benefits of the innovation model they inhabit, compare themselves to others using a similar approach and borrow selectively from other categories.

IS YOUR COMPANY BUILT FOR INNOVATION? IF IT IS, it’s likely to fall into one of the following four innovation archetypes.

1. The marketplace of ideas
In the marketplace archetype, employees are charged with creating new ideas, shopping them around to gain support and implementing them rapidly to test feasibility and market acceptance. It is an environment that is somewhat chaotic by design.

Google typifies this model. The company emphasizes hiring bright, creative people and tells them that up to 20% of their time may be spent pursuing personal ideas. While the firm has portfolio guidelines— currently 70% of projects focus on core search and ads, 20% on extensions to search such as news and 10% on speculative ideas—there is a highly decentralized system to determine which projects move ahead. Employees create ideas, post them on internal Web bulletin boards and discuss merits, risks and nearterm action plans.

Those ideas that generate the most support through this process move into rapid prototyping. Product requirements are kept as simple as possible so that features may evolve as users provide feedback. Early versions are quickly released for internal use, then for beta release through the Web site’s Google Labs.

Google is not alone in fostering a bottom-up approach to innovation. Others, including 3M, Best Buy and cable television companies like Viacom, take this tack. People are lauded for coming up with ideas, trying them quickly and learning from experience. Failure is expected and even rewarded, as long as it improves the company’s understanding of technology or the market.
Because the marketplace model relies on highquality input of ideas, these firms tend to seek opportunities from many sources, including close interactions with clients and partners. Once they vet ideas, firms in this archetype tend to have a relatively short time to market and launch many new businesses. This speed to launch is due partly to the companies’ preferences for validating ideas in the marketplace rather than with detailed upfront analysis.

2. The visionary leader
The visionary leader model revolves around a senior executive who understands the future better than customers may, motivates employees to zealously pursue that vision and keeps generating ideas that are unexpected and profound.

Steve Jobs of Apple is the paragon. His visions have included creating one of the first personal computers, commercializing the graphical user interface on the first Macintosh, bringing design to computing with the iMac, and developing the iPod. While the firm has created many innovations, it tends to launch only a few key products at a time and in fact spends less on R&D than the industry average.

Apple’s big ideas often have not started with Jobs. A little-known product designer named Tony Fadell thought up the iPod, for instance. Jobs’ great talent is the ability to spot high-potential concepts, champion them and inspire teams to pursue them.

Other visionaries include Henry Ford, who once famously said, “If I’d asked people what they wanted, they would have asked for a better horse.” Ford innovated both in product design and production process, designing unthinkably inexpensive cars produced in a very new manner.
Sony’s Akio Morita closely observed consumers as they went about their daily lives. Morita believed that markets that did not yet exist could be accurately measured and analyzed, so he relied on his observational insights to design some of the company’s most successful new products. His thinking about how Sony’s technology could improve consumers’ experiences led to such game-changing products as the Walkman.

Sometimes the vision does not involve an end product or process but instead focuses on a new method of approaching the customer. Harrah’s Chief Executive Gary Loveman, for instance, came to the company after teaching service management at Harvard Business School. He decided to use data analysis to target the ideal customers for his gaming business. He then united his company to pursue that goal, with impressive results.

This model goes beyond executive inspiration. These organizations typically construct formal mechanisms that are designed as conduits for making operational the ideas of the visionary.

3. Systematic innovation
Most companies aren’t Google or Apple. Their culture, their people and their environments are very different— causing them to take another route to innovation: They create processes designed to produce results systematically.

It is easy to believe that such efforts only generate bureaucracy, endless meetings and me-too products that yield tepid growth. After all, if companies have similar processes and similar people, they will likely create similar outputs. However, it’s possible to use such rigor in mold-breaking ways.

Samsung provides an example. Over the past 15 years innovation has helped set the company apart from fierce competitors. This vast company creates more products in a year than any visionary could possibly conceive and it does so within a Korean company culture not historically inclined toward bottom-up idea generation.

The firm succeeds through a mix of executive prioritization and team processes. Samsung’s leadership prioritized design as a critical competency in 1993 and significantly increased the design budget to support the emphasis. It developed Design Centers in London, Los Angeles, San Francisco, Tokyo and Shanghai to look for emerging customer trends. It created an Innovation Design Lab as an in-house school for promising designers, and it sends people on internships in industries as diverse as fashion and cosmetics to gain new ways of thinking.

The company invests about 10% of its revenues in R&D—a very high figure for the industry—and it devotes 15% of its R&D team to looking at needs and lifestyles ten years from now. The firm unites its disparate businesses through leveraging a common core of semiconductor components, a field in which it holds a strong position. Importantly, senior management strives to create a culture of perpetual crisis that forces the company to look seriously at competitive threats and develop new growth businesses.

One key is breaking down barriers between internal groups and then facilitating rapid innovation to meet competitive challenges. For example, more than 2,000 people a year cycle through its Value Innovation Program (VIP) Center outside Seoul, where designers, engineers, planners and programmers gather for days—or months—on end to hammer out detailed specifications for new products.

The center was established to bring together critical team members at the start of a project. These cross-functional teams work long days in windowless rooms to shape ideas and resolve differences, returning to their ordinary jobs only after the task is completed. Fifty “value innovation specialists” facilitate the work. The teams strive to break down stale cultural norms and encourage junior members to challenge senior staff. Output is rapidly prototyped and tested.

Systematic organizations conceive of innovation in both strategic and tactical terms. Strategically, they pay relatively high levels of attention to the landscape in which the innovation is to take effect. Tactically, they focus on project execution, seeking efficient and fast implementation.

In addition to Samsung, Procter & Gamble and Goldman Sachs typify this approach.

4. Collaborative innovation
The models explored thus far rely primarily upon internally generated innovation to create growth. Another archetype is more externally oriented, featuring companies that team with outside partners to evaluate a wide range of opportunities, rapidly select the ones to trial and often implement the ideas through these partners.

Vodafone illustrates this model. Its strength lies in its global brand and its customer service. However, its network equipment is supplied by outside firms such as Ericsson, its customers are often acquired by thirdparty dealers such as Carphone Warehouse and its software applications are sourced from a range of third parties. Vodafone has even partnered in owning wireless networks, whether in the U.S., with Verizon, or in Bahrain, with the Kuwaiti firm MTC.

Vodafone excels in understanding customer needs, outlining what they’re looking for and seeking the appropriate solution from its partners. It then performs quick but thorough quality control and plugs the innovation into its network. If the solution proves off the mark, the firm can swap in an alternative relatively easily. Its technology infrastructure facilitates this flexibility, as does its large idea pipeline.

Collaboration organizations gather “innovation intelligence” by building formal relationships with other firms that can help them not only shape the innovative concept but also actively implement the solution. For example, most movie studios are collaboration organizations, partnering with independent producers to generate ideas, with technology companies to create special effects, and with advertising agencies to promote new releases.

Another more recent example is social networking Web site Facebook, whose popularity has soared since it opened its platform to outside developers. Today thousands of programmers around the world have given Facebook a broad menu of applications featuring everything from fantasy sports to photo sharing. Such alliance-friendly organizations work to develop a performance vision shared by their partners.

By understanding which archetype a firm inhabits, leaders can gain perspective on what actions will best foster innovation. Of course, there is no single formula for successful innovation. But research shows that most firms can’t easily change the method in which they innovate. It’s like trying to change your genetic makeup with plastic surgery. A more fruitful approach is to embrace your innovation archetype and improve upon it.

Excerpted from a recent issue of Strategy & Innovation. For more, go to www.forbes.com/strategy&innovation and also from "Built for Innovation" by Stephen Wunker and George Pohle 11.12.07 , www.forbes.com

Yahoo may consider Google alliance

Yahoo may consider Google alliance, source says (By Eric Auchard
Sun Feb 3,http://news.yahoo.com)

Yahoo management is considering revisiting talks it held with Google several months ago on an alliance as an alternative to Microsoft's bid, which, at $31 a share, Yahoo management believes undervalues the company, the source said.

A second source close to Yahoo said it had received a procession of preliminary contacts by media, technology, telephone and financial companies. But the source said they were unaware whether any alternative bid was in the offing.


Moreover, from http://www.marketingcharts.com/ indicated;
The combined market share of visits for Microsoft and Yahoo would be 15.6% of all internet visits, with Google at 7.7%, for the week ended January 26, Hitwise found.

The combined content of Yahoo and MSN properties would result in an impressive list of top sites by industry category, according to the analysis; Yahoo accounted for the most-visited sites in six categories for the week ended Jan. 26.
However, in terms of US search volume, Google accounts for 66%, whereas combined Yahoo and MSN Search volume would total 28%, according to December’s search share data from Hitwise.

A person familiar with Google's thinking said the company believes Microsoft is using the same playbook it did in the 1990s to switch Windows users away from Web browser pioneer Netscape Communications to its own Internet Explorer.
"It is the same old story," the source said.(Eric Auchard;Yahoo News,Feb 3,2008)

Microsoft bids $45.6 billion for Yahoo

Microsoft Offers $44.6B for Yahoo
Friday February 1, 12:38 pm ET By Michael Liedtke, AP Business Writer

SAN FRANCISCO (AP) -- Microsoft Corp. has pounced on slumping Internet icon Yahoo Inc. with an unsolicited takeover offer of $44.6 billion in its boldest bid yet to challenge Google Inc.'s dominance of the lucrative online search and advertising markets.

(From : http://biz.yahoo.com/ap/080201/microsoft_yahoo.html)

Microsoft Proposes Acquisition of Yahoo! for $31 per Share
Transaction valued at approximately $44.6 billion in cash and stock; provides 62 percent premium to current trading price for Yahoo! shareholders; combined entity to create a more competitive company, providing superior value to shareholders, better choice and innovation for customers and partners.

(From: http://www.microsoft.com/presspass/press/2008/feb08/02-01CorpNewsPR.mspx)