This month's issue: Maintaining a competitive advantage.
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Simple. Powerful. Elegant.

A Newsletter from Creative Ventures

Issue #128

Big News

When you’re doing interval training--short, high aerobic sprints--you find yourself looking forward to those small recovery periods you get between sets.  You get to catch your breath and let your pulse slow down before it’s time to take off again.  That’s what the last half of October and November are in our schedule, a small rest period.  We planned this on our calendar to allow us to focus the finishing touches on the Repeatable Successful Acts (not going to be the name of the book) book and finish our extensive planning for a very busy 2017.
We have 15 of the 21 chapters in the edited form that will make up the final manuscript, which is due November 15.
This rest from the travel schedule that usually makes up our lives provides us with the time to finish a few projects that need final touches and to begin the storyboards for brand new projects already booked for 2017.
Here is the latest Over Coffee Video.  It’s a sketchnote version!



The Idea




"And their feathers once so fine grew torn and tattered. " 

- Jackson Browne

It’s good to be the top of the mountain, the head of the class, El Numero Uno, but it is often a warning.  You would think the stability of the mountain would be a great foundation for dominance, but the reality is markets are more like ocean waves than mountains:  unpredictable, unstable, dynamic, and in a state of constant motion.  Though this picture is kind of scary, waves offer unique challenges, opportunities, and--take it from an ex-surfer--great thrills.  To ride a wave you have to be nimble, ready to respond to quick changes, able to deal with failure, you have to have good vision for what’s going on around you, and most importantly, you have to have a skillful eye on the horizon.
Readers with a little gray in their hair will remember frantic Friday evenings and the sprint to your local Blockbuster in an effort to grab a new VCR tape release for your home-based movie night.  Arrive a little late and you will be subject to the wretched refuse of older releases, or you might ask to look in the “return bin,” a form of entertainment dumpster diving, in an effort to grab some must-see movie that had been returned.  Blockbuster was the king of the stay-at-home date night.  But that mountain of success was crumbling and changing.  After $40 worth of late fees for Apollo 13, Reed Hastings started Netflix, and the waves of change began billowing.  But the mountain proved too tempting to descend and the lure of $800 million dollars in annual late fees proved to be an anchor for Blockbuster.  Red Box appeared in McDonalds and the home video/DVD market was attacked on another front.  By 2002, Blockbuster had $1.6 billion in losses.
I used to love hanging out at our neighborhood Borders bookstore with Laura.  We would always come out with books.  You remember books, right?  Bound with adhesive and printed in a fixed font on paper?  But being the top dog made Borders lazy.  Changes in the publishing industry were accelerating faster than a 30 foot wave, a Maverick break in Half Moon Bay.  Amazon was booming and the Kindle was becoming one of the most disruptive pieces of technology since the iPod.  Barnes and Noble’s Nook reader hit the market in 2009, but Borders waited too long to try their hands at a digital reader, finally offering up the Kobo.  Any Kobo owners out there?  In order to do something—anything--they decided to let Amazon manage their web site.  HUH???  Let the fox in the chicken coop, and sure enough the chicken house will fall!
One more example?  How about Kodak, no, wait a minute, let’s do Polaroid.  Polaroid was the dominant, and I mean DOMINANT, player in instant camera photography.  They were revolutionizing the picture-taking process as early as 1960.  But they weren’t sitting on the top of the mountain enjoying the view.  By 1989 over 40% of their R&D was dedicated toward digital photography.  They saw the change.  But the pull of their dominance was just too strong.  Here is a line from their annual report:  “The need for a permanent visual record will still drive the industry.”  By 2008 they had stopped camera production, and in 2009 they stopped making film.
These companies were all run by really smart people.  You don’t become dominant without making really good decisions.  But for these corporate giants something happened on the way to the beach.  The tide changed.  Something new was tugging on their markets, like the moon tugs on the ocean.  It was visible to some and invisible to others.
So, what’s the lesson?  How do you thrive in a society that is evolving faster than many organizations and companies adapt?    There have been countless accounts of what went wrong and what to do, but I think there is a simple and applicable element that both protects what you do well and still allows you to take advantage of the great wave ride.



Do This!

TALK: I mean talk as a specific strategy.  There are all kinds of talking going on in your company, formal and informal.  Informal communication is constant and is more organic in its appearance.  It kind of just happens, but that doesn’t mean it lacks value. In a fiercely competitive business world, what your people know is a primary resource. Here is a way to take advantage of informal talk.  Find places around the office to put whiteboards, or cover a couple of walls in glass (makes for a fantastic whiteboard).  Place these at central locations where people gather.  When we did this by designing IDEA FACTORIES for clients it allowed informal chatting to become visual.  We even created an IDEA WALL where anyone could post an idea.  In addition to stimulating informal talking, create formal talking opportunities.  This is a way to make conversations count.  Set up town hall meetings with the focus on only one or two topics for discussion.  Set them up around lunches and watch the dialogue open up. In changing times, your people know what’s going on. By strategically encouraging talking you open your company to ideas and observations that otherwise might go unnoticed, or even worse, unsaid.


SQUARE DANCE: Square dancing and line dancing are forms of group dance involving a bunch of folks.  People are bobbing, swaying, spinning, and jumping.  It all happens at the same time.  No one stays isolated; everyone just kind of gets involved.  In square dancing there is a caller, someone signaling what to do.  One of the great tragedies on many of the failed companies is the isolation of silos.  Divisions become worried during bad times and shore up their defenses.  “No one is cutting my division” becomes the mantra.  People stop exchanging ideas and information while slipping into insulated roles.  STOP that!  When change is in the air is the time to get rid of silos.  Force divisions into dialogue if you have to.  Provide strategic opportunities for accounting to visit with sales, marketing to talk with upper level management.   The late great Kodak did not die due to a lack of ideas, heck, they INVENTED the digital camera!  Their demise came from marketing not talking to manufacturing, leadership removing themselves from daily conversations, and marketing holed up trying to figure out where the lifeboats were.   You need to be square dancing and not dancing alone in the dark.


PROTECT AND SERVE: Kind of stole this one from your local constabulary.  This is about having a dual mindset.  If you are successful in your business there are things you are doing really well.  Identify in your current service/product suite those items that form your foundation.  You more than likely already know what they are.  These are your protected business elements, and you need to treasure and cherish these as your identity.  But there is another element, opportunities for you to serve your client base in new and dynamic ways.  Think about the advantages technology has brought to your business that were unimaginable five years ago.  What’s going on out there that would allow you to create a greater level of service and that would augment and leverage your protected business elements?   Look for ways to combine these two mindsets, protect and serve, so that your client experience, your company’s real purpose, and your people are aligned.  AT&T went from a communication strategy to adding entertainment services.  Where are your protect and serve opportunities?




WE CAN DO IT BETTER... IF YOU LET US. : Some of you may remember the monumental crapshoot that was AOL’s acquisition of Time Warner in 2000, often cited as the worst merger in the history of business.  Well, AT&T thinks they can do it better than AOL and has proposed an $85.4 billion deal to acquire the Sam Bradford (most overpaid quarterback in NFL history) of content companies. Why, after such a colossally bad precedent, would AT&T think this was a good idea? The telecommunications giant understands they operate in a saturated market and need to look to the future of content delivery, and Time Warner is a content company looking at the future problems of delivering their awesome content (HBO, CNN). In this transformational time of how consumers obtain and consume content there is uncertainty on what TV and content consumption will look like in ten years. Will consumers want live TV or only scripted shows? Will they watch on a traditional television set or a tablet or phone? The issues that both of these companies face make the merger seem like a match made in heaven, a “you’ve got the content, we’ve got the delivery service” type of thing. Unfortunately, this deal seems like a bit of a Hail Mary. It’s likely it won’t happen due to current antitrust laws; however, it is exciting to see these companies dip their toes into the water, so to speak, to address the issues that seem to be racing toward them both.

ALL SHOULD REJOICE, THE BEER IS HERE!: Otto, the self-driving technology startup that was recently acquired by Uber for a mere 700 million, just made history. This week one of Otto’s trucks made its first delivery without the assistance of a human driver. Its first payload:  2,000 cases of Budweiser, the King of Beers. In keeping with the theme of this newsletter, Otto is worth talking about as an adaptive company moving with the shifting tides. Uber hopes to see an even mix of driverless and human operated automobiles on the road in 20 years, and they want to lead the way in this effort. The issue they keep running into is whether or not this technology is commercially viable. The maiden voyage of their first truck, and partnerships with big ol’ companies like Anheuser Busch who want to be at the forefront of this wave, definitely help to ease this worry a bit, but it is still an uphill battle for them. Changing the market is never easy, and doesn’t happen overnight, but Otto is embracing the challenge. After all, how else do you take over as the world’s transportation mega giant?

TAKE IT EASY MICROSOFT: Say goodbye to solar panels as you know them. Until now we’ve only seen panels on roofs or in large open fields farming the sun. Now, thanks to Solar Roadways, this is about to change. Solar Roadways has developed durable solar panels that have the potential to become the future roadways of America.  A rest stop in Missouri, right on Route 66, is about to become ground zero for the next era of solar energy. No, they're not going to start repaving the famous Route 66 with durable glass, but they are replacing all of the sidewalks around this rest stop with these high-tech panels for their big beta test. If this little project is successful, the plan is to move from sidewalks to parking lots to ramps and ultimately major streets and highways. Even if this small test is a hit, the industry still has some major hurdles, number one being price. Until solar panels become efficient to produce, through a refined manufacturing process which will ultimately lower costs of production, this is still a futuristic dream of Greenies of the world. Still, a move this big in the solar energy field is something to get excited about.


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