The value of knowing where time goes

Time and tide, as we all know, wait for no man.  There’s no better time of year to be reminded of that as we review the past year.  What projects did you complete?  Which ones weren’t even started?  What should have got done, but didn’t?  What was important to you?  What was your greatest success?  What was your greatest failure?  What would you do differently if you could replay the year again?

It’s an interesting exercise, and if you haven’t yet reviewed the year I’d urge you to do so.  I gained a number of insights from reviewing my 2011.

Certainly, the big things that I accomplished during 2011 were done with the aid of quite a bit of planning, focus and time.  Now that’s not to say that everything that gets planed, focus on and time to will have a successful outcome, unfortunately, but it does increase the chances.  And when I look back over my life at my major successes, I also recall the planning, focus and time that went into them. 

Which brings me to the value of knowing where time goes.  Because of the nature of my work, I analyse how my time is spent.  It provides an invaluable additional dimension to reviewing the year.  I can see how much time I spent on various different activities, and how much time I spent on my important projects.  It gives me another lever to make changes – whether I should be giving more or less time to certain activities or projects.

I don’t think many people do this, perhaps because it reminds us of “clocking in and clocking out” and “command and control” type management systems.  No one likes someone breathing down their necks to see what they are doing every minute of the day.  And sometimes we don’t want to see the unpalatable truth ourselves.  But, certainly for me, unless I know where my time goes, I’m in danger of not giving enough attention to the important-but-not-urgent things. 

Eisenhower apparently remarked that “what is important is seldom urgent, and what is urgent is seldom important.”  Which may go some way to explain why important things don’t always get done.

So one of my New Year resolutions is to track my time more carefully, and analyse it side by side with the big things I’ve want to do this year.  As regular readers of this blog will know, I’m a big fan of measuring things.  It will be interesting to see whether increased focus in this area brings about improvements.

Work with your hands, and all you get is dirty hands

Until very recently, increasing efficiency meant creating a software system to store relevant information about part of your business. Instead of doing the job manually, or on spreadsheets, it went into a database system. Software systems improve productivity and efficiency, whether it is linked to other aspects of a company’s work (ERP) or stand-alone.

It is a hugely successful approach that all businesses have embraced.

The focus on these projects is the data that needs to be stored in the system. If you put the right information in, we thought, you will get the right information out. The only problem is that all the emphasis went on putting information in, and hardly any focus was on understanding the data.

As the big system trends, such as accounting, CRM and ERP, are becoming more mature, we are now turning our attention to what all this information means. And increasingly we are finding that it is not as self-explanatory as we thought.

Firstly, data isn’t neatly together in one place. Rather, it is in a number of different systems that were created at different times for different reasons.

Secondly, traditional system reports are geared towards efficient systems, not business insight.

Thankfully, a new generation of software tools is coming to the rescue. They are focussed entirely on finding meaning from existing data and are priced to be attractive to businesses of all sizes. For example, Microsoft’s SQL Server Integration Service, Analysis Services and Reporting Services are included in all versions of SQL Server from 2005 at no extra cost.

This changes the nature of business competition. As well as having products and services that customers value, which you can produce cost effectively, visionary businesses are looking at their systems to find new insights and meaning within customer information. And they are using those insights to improve the value they provide to customers.

It is a logical next step. We’ve all spent 25 years creating software systems; now it’s time to use that information profitably. As my father is fond of saying, if you work with your hands, all you get is dirty hands. But if you work with your head ....

Why Customer Intelligence is the No 1 Priority for Marketers

Customer Intelligence is the process of improving strategic marketing decisions by joining together and analysing customer data from a company’s various different software systems.

Despite it’s relatively low profile, it is likely to be the single most important issue facing marketing professionals over the next 10 years. Why? There are three big unstoppable trends:

1. Customer data volumes are exploding. Disk space is cheap, database systems are powerful and can store many different types of data, and software applications such as accounts, CRM, ERP are holding vast amounts of customer-related data. The result? More customer data than you or your competitors have ever had before.
2. Increased competition. Globalization has been a trend for over 100 years, but with cheaper travel and better communications it has become more pressing over recent years. The internet reduces barriers to dealing with suppliers in different countries and massively reduces costs. Consolidation in many industries has also been a competitive trend, resulting in larger and better funded competitors. Both trends are continuing in many industries.
3. Better informed customers. High speed internet connections and low priced PCs have enabled every home and business in developed countries to be connected. When only a few years ago information was difficult to find, now Google produces highly relevant search results instantly. The increase in consumer comparison web sites puts a great deal of power in the hands of consumers. And where once content was generated by the marketing department, now it is generated by millions of bloggers, reviewers, contributors to Wikipedia and social media enthusiasts. There is no shortage of information for customers who want to know.

It’s not difficult to conclude that vendors will have to work harder to attract and retain loyal customers.

Yet customers have not changed. They still want value from their purchases, and they want their custom be valued.

Differentiation and value are still the keys to keeping customers happy. And understanding customers is the key to figuring out what they value.

Customer Intelligence is all about understanding customers; their history, their behaviour and their preferences. The information is already sitting in a million accounting, CRM or ERP systems and will yield a million different insights for the methodical marketer.

So Customer Intelligence will become the number 1 issue facing marketers over the next decade. Data-centric decision making will become vital as businesses of all sizes search for ways to improve products and services. Astonishingly, most companies already own the tools needed to create these marketing insights. All they have to do is to use them.

How well do you know your customers?

I guess the answer to that question will depend on what type of business you are in. If, like me, you are in a service business, the answer might be “pretty well, thank you!”

But if the question were phrased slightly differently: “What characteristics do you look for in new customers?” that might not be so easy to answer. Attracting new customers isn’t always straightforward. And all our customers are different, aren’t they? Well yes, and no.

Yes, in that we are all unique. No, in that we share characteristics that make us more or less likely to purchase from any given business. If we can understand those common characteristics then we are better placed to attract and keep profitable customers.

Most companies have a lot of data about their customers, but very little insight into what these common characteristics are. Yet with a bit of analysis these shared characteristics can be uncovered. It’s called data mining, data analysis, analytics, or segmentation depending on who you talk to. But it’s a potentially profitable part of any new business campaign.

What is a data warehouse? And do you need one?

The language of business intelligence can be confusing. Cubes, data warehouses, OLAP, and data mining are all terms that are not exactly self-explanatory. One of the most often used terms in business intelligence is the Data Warehouse, which conjures up images of vast spaces filled with digits. As if 5’s and 8’s all had their own bin in a super-efficient warehouse.

So what is a data warehouse, and how is it different from other databases?

Just about every company has at least one transactional database, and most have many. They store accounts data, contacts, stock or project data. Transactional databases are the ones we use to run our businesses:

• Those that get updated on an hourly, daily or weekly basis
• The systems (whether we recognise them as databases or not) that we could not do without.

But not every company has a data warehouse. They are often considered the domain of very large companies, even though that is not necessarily true.

A data warehouse holds historical information. It’s where the data goes after it’s been used in a transactional database system.

As an example, a hotel reservation system is used to let customers know whether there is availability for their preferred dates, and to produce an invoice for hotel services used during their stay. A data warehouse for the same hotel might hold this information summarised by day, month and season so as to better understand customer booking behaviour.

Transactional systems hold detailed information such as the alarm call time for the guest, whereas a data warehouse summarises several years’ data to get a more accurate picture of how promotions or seasonality affect bookings.

In addition, data warehouses can bring data together from several different transactional systems to gain new insights into a particular problem. In the hotel example, costing information might be added to find out which customers are most profitable.

So whether or not you need a data warehouse depends on what your business priorities are. Whether, for example, you want to:

• Better understand customer behaviour
• Understand which customer segments are most profitable
• Send more appropriate marketing communications to your customers

There are many, many more uses for data warehouses, but understanding customers and profitability better is a good start if you haven’t started planning your data warehouse.

How involving is your marketing?

“Tell me and I’ll forget, show me and I’ll remember, involve me and I’ll understand.”

Marketing is often thought of as the way of getting a message out to a particular audience; a way of broadcasting our message in the hope that someone hears and finds it interesting enough to buy. Television, radio or cinema advertising is an example – advertisers expect their audience to sit, listen and absorb their message. They hope and expect that next time consumers need their product or service they will remember the advertisement and buy.

Data handling has now made it possible to interact with potential purchases to a great degree than has ever been possible before. Database marketing, Twitter, Facebook and LinkedIn are all good examples of involving people in a company’s brand, product or service.

A simpler, but no less effective device is the survey or questionnaire as a way of involving customers or prospects. Instead of guessing what people want, you ask about likes and dislikes. Some companies even listen to the answers.

At its simplest level, involvement marketing is getting customers to DO something, rather than passively listen to a marketing message. Involvement includes signing up for a loyalty card, answering a survey, joining a group on Facebook or LinkedIn, attending a webinar or requesting a sample. All these things indicate that the person not only knows about your company, but they care enough about what you are saying or selling to join in the conversation.

Involvement marketing is all about creating a mutually agreed communication link – where both parties understand the ground rules, and both parties benefit. It sounds simple, but it takes thought and technology to get right. But it’s more cost-effective than broadcasting, and therefore ultimately a better deal for everyone.

What do you think? Get involved and leave a comment with your examples of the best and worst of involvement marketing.

It's a Digital World!

Internet World is a major London exhibition for digital marketing. With Facebook now topping over 400m active users and Twitter with 75m users, it’s tempting to wonder what other sort of marketing there is. Certainly no business can afford to ignore online marketing.

Some companies excel at eMarketing. Dell Computers are a great example of a company that is embracing social media and one of the few companies who are successfully selling through Twitter. Although the blogosphere is divided as to how profitable those sales are currently, there is little doubt that getting in early and understanding how social media works is likely to pay dividends in the longer term.

So with an eye to checking out the latest trends, the newest software as well as meeting some customers and competitors, I’ll be at InternetWorld over the next couple of days. As web marketing is changing fast, I’ll be trying to sort the hype from the next big thing. It should be interesting!

What do your customers need & want?

Knowing your customers’ needs, wants and preferences is vitally important in today’s world. Of course, it has always been important, it’s just that software now enables us to do so much more. Which of course means that if we don’t understand our customers’ needs and wants, someone else will make the effort to understand them.

Which kinda puts the pressure on to start figuring it out.

We all like to think we know our customers well. But the truth is there are some things about them we know very well, and other things we are blissfully unaware of. Yet most customers are more than happy to provide all the clues you need to understand them. After all – they buy from you – that’s a pretty strong clue as to what they need and want.

When you start to have a look at the data you have about your customers there is a surprising amount of it:

• Who they are and where they are located
• Which promotion they responded to when they initially bought from you
• Who in the company made the purchasing decision
• Who influenced the purchasing decision
• Who in your company dealt with the customer initially
• Who in your company deals with the customer day by day
• Who you normally deal with, day by day
• Products or services they have bought from you
• Time taken to make the purchasing decision
• The cost of producing the products or services they buy
• How long they take to pay
• Goods or services they have returned or complained about
• What they buy from others
• What promotions they have responded to by buying or enquiring
• What promotions they have not responded to

Of course every company is different, and that list will be much longer when you start thinking about the various systems you store customer information in.

So the key is to bring all this information together, so you can analyse it and start to better understand your customers’ needs and wants. Business intelligence software, such as Microsoft SQL Server Analysis Services enables you to do just that. What once could only be looked at in its own separate system can now be brought together with data from other systems.

It’s powerful and enlightening - and you get increased loyalty from your customers because you can provide a better product or service. It's an exciting time to be in business!

Energy rhetoric, but little data

The Secretary of State for Energy and Climate Change, Ed Milliband, argued in The Times yesterday that “we must try every option to shift to a low-carbon world”. He reasoned that energy security and climate change commitments were sufficient incentive to back the government’s policy of building new nuclear power plants.

I, for one, would like to see more data.

Let’s not forget that nuclear power is also a threat to the planet. Whilst melting ice is not a popular move with that most potent symbol of our planet – the polar bear - neither is waste that stays radioactive for hundreds of thousands of years. The choices may not be palatable, but surely all the more reason to have good data, presented clearly.

Renewable energy, he said should not be dismissed: wind is producing enough power for 2 million homes. 2,000,000 is indeed a large number – an impressive number even. But it is a meaningless number in the debate about energy and climate change. How many homes and businesses need power? And at what cost?

Milliband rightly pointed to the future with ideas such as “clean coal” which as soon as the technology is ready the government will ensure will be 100% committed to. Whilst he was quick to quantify the potential jobs that will be created through this R&D, he was less keen to share the costs even though they are equally quantifiable.

Neither did he talk of other technology which might provide low-carbon alternatives a great deal more palatable for our polar bears than sitting on radioactive waste for a million years. Yet they do exist.

This whole issue is quantifiable: cost of power, amounts of subsidies, carbon emissions, temperature changes, sea levels, thickness of ice, number of species. I could go on – they are many and varied and all absolutely quantifiable. Yet for some reason we prefer pictures of polar bears to clear data which would help us make good decisions about what mix of power to rely on.

The UK has armies of statisticians paid to collect, collate and present exactly this data. Couldn’t Mr Milliband have included some of their work? He was writing for The Times, after all.

What is data mining?

After a couple of posts about coal and diamonds I thought it might be a good idea to post a straightforward answer to the question: What is data mining?

Data mining is the applications of statistical techniques and artificial intelligence to find patterns in data that are not apparent using queries or other database techniques. Data patterns can provide insights into behaviours and trends that would otherwise remain hidden. Data mining is perhaps more descriptively known as knowledge discovery in data.

The statistical techniques are run as software programmes which allow parameters to define how the algorithms are applied. The pattern-finding process can be run on different data sets and with different parameter settings. Models can be refined to improve the accuracy of the results.

Although data mining algorithms can be run on any data file, they are often applied to files where data has been brought together from a number of different sources. Different statistical techniques, or algorithms, are suited to different types of data, and different problems.

The basic premise of data mining is that predictions can be made about the future from a sample of past behaviour, ie the existing data files. For example, theatre bookings together with other information about those who made the bookings can be used to find patterns, and predict what type of productions they might book in the future. Segments can be found and different marketing messages sent to them according to their profile.

Data mining is the automatic or semi automatic means of finding patterns and making predictions.

Data mining has now been built into Microsoft’s SQL Server database: starting with two algorithms in SQL Server 2000, extended to 7 algorithms in SQL Server 2005, and with some further enhancements in SQL Server 2008.

Get in touch if you would like to find out whether your data files are suitable for data mining.

Diamonds are a girl's best friend

I wrote about data mining the other day and got some interesting comments. One was that my analogy of gold wasn’t quite accurate. Analogies are dangerous things.

The comment was quite correct, though, because although data mining can turn up information that is of significant value, it takes work to get there. The new analogy was offered - that of an uncut diamond. A diamond is as unappealing as coal in its raw state – but much sought-after in its cut and polished state.

So it is with data mining – gold coins do not drop into your lap as if you were playing a slot machine, you have to work with the new knowledge to figure out whether you have an uncut diamond or a piece of coal. It could be either – and of course an uncut diamond in the hands of someone who doesn’t know what to do with it might as well be coal.

A business intelligence specialist told me recently that he felt uncovering new knowledge from data was only part of the solution –the remainder being to display the data clearly and to communicate its meaning in an effective way.

Whilst the underlying data mining or statistical skills clearly have to be present, there is an element of polishing and crafting the newly found information to let its brilliance be seen. Perhaps what we need are some rather different skill sets in getting the full message across: communication and visionary skills.

It also goes some way to explain why business intelligence, data mining, performance management, and data visualisation fit together so well.

Data mining - digging for gold

Just as coal is the work-horse of modern energy production, so the relational database is the work-horse of modern business. Alright, one is black and dusty and the other is, well, virtual and clean, but the end result is the same - reserves waiting to be mined, whether the reserves are coal or data.

Reserves which may contain gold for their owners.

Before you put on your hard hat with the lamp on the front to break open the server, I’m talking metaphorical gold - metaphorical gold which could be worth a great deal more to your business than the real thing.

First – let’s consider the reserves, which unless you are actually a mining company will be the data stored in databases within your company. Then, let’s look at what the gold might be that’s hidden in the data.

There are few businesses which have not installed a database, whether for managing customers, accounts or stock. As more enterprise-wide systems are installed the amount of data being generated is phenomenal. Some of that data will be immediately accessible through reporting tools. But what could happen if those databases were joined together? What if you could see the sales information together with the customer management information? Or the training data together with sales data? At the risk of mixing enough metaphors to make soup, that would really be cooking with gas ….

But whether it’s one database, or a number joined together, how do you go about looking for gold? Indeed what does gold look like in data terms?

How you find gold is by using a technique called data mining, and what it looks like all depends on your business. It may be customers who are more likely to book a particular type of show in your theatre, or finding which products to bundle together to maximise sales and profit. Or it could be something completely different – depending on what business you are in. The applications for data mining are many and varied and are limited only by business owners' imagination and ambitions.

Data mining is now more accessible and affordable than ever. Products such as Microsoft SQL Server 2008 and 2005 put data mining within the reach of most companies – large or small.

Get in touch if you want to dig for gold in your data. Hard hats with lamps supplied.

Play to your strengths

How the Moscow City Ballet reminded me that bringing out the strengths in yourself and others is a great deal more productive than moaning about weaknesses.

The week finished as it started, with a visit to the ballet. Moscow City Ballet danced their ballet slippers off in Sleeping Beauty last night. It was enchanting. The corps de ballet were in delightful harmony. The costumes were lovely. The applause was rapturous, loud and long.

Watching Moscow City Ballet twice in one week has made me think that Performance Management isn’t only about measures. Performance Management is as much about Management as it is about Measures – you need both. Measuring something that is not up to standard tells you only that - that it isn’t up to standard. It doesn’t necessarily tell you what to do about it (although analytics can sometimes give you a start).

While the heavenly Valeria Guseva and her Prince Sergiy Zolotaryov could steal any show, the performance isn’t only about the stars; it’s about the whole production. Moscow City Ballet played to their strengths and brought out all that is great about Russian ballet. Yes, it was traditional, but also had some lovely humorous touches. No, it wasn’t technically daring, but it was well done and all the better for it. And just for the record – Talgat Kazhabayev as the Bluebird was all that a male dancer should be – and more. Oh, those Russians!

In business, we tend not to like weaknesses. Yet we all have them, and we all have our strengths too. The counter argument of bringing strengths to the fore I think works much better. Yet often that isn’t what we do. The good stuff we just pass off as “it’s his job” but the poor stuff we complain about.

Getting an appreciation of your own strengths, and those of your colleagues or team, isn’t always easy. Unless we are looking out for strengths we can name, they often go unnoticed in the general noise of day to day work. But something special happens when you do identify strengths.

Finding that “Mary is particularly good at negotiations”, for example, opens up opportunities. Mary is flattered to be thought to have expertise in this area, and works even harder on it. She is keen not to fluff up a negotiation and so prepares better and works more diligently. As others see her expertise they ask her advice, or let her coach them in negotiations, both the benefit of Mary and the rookie negotiators.

How much better is the above scenario than making an example of Hubert who always seems to get it wrong? Bemoaning his lack of expertise, and the time and money wasted through his inept attempts, which may or may not be fixed through training. My guess is that Hubert’s problems with the subtleties of negotiation are because his strengths are of a logical nature. His abilities at maths or complex problem solving might be of huge help to Mary if more were made of them.

The difference is only a matter of perspective – looking for, and using, the strengths and qualities in people’s abilities. Our strengths are often deep seated. Whilst education and training undoubtedly play a part in making us more rounded players, our natural abilities will always be where we will shine. Applying education and training in the areas of our strengths can be magical. Yet, so often we do the opposite – apply training to our areas of weakness. Although it’s a little counter-intuitive, working on strengths can build better performance.

As teams large and small are asked to deliver more with less, tension can rise and tempers fray. Finding a few experts on your team and encouraging them could unleash hidden potential.

Try it – ask people who know you what they think you do best, and what you do less well. Listen with an open mind and write down all the comments (or get them to write them down in their own words). Then watch yourself at work and see what you agree with, and what you disagree with. Over a couple of months keep revisiting the comments and look for evidence of what you are doing well, and where you are weak. Then work on your strengths and measure the difference. Figure out how to use your strengths to make a quantifiable difference in you business. Is the applause more rapturous, loader and longer?

We all need moonbeams sprinkled on our work from time to time. Find some opportunities to be your own Lilac Fairy and bring a Sleeping Beauty or two alive with your own particular expertise.

As for me – I’m now asking myself whether practicing my pas de chat and pirouettes is really the best use of my time ...

Reach for the stars

“When you reach for the stars, you may not quite get one, but you won’t come up with a handful of mud either.” Leo Burnett

Leo Burnett was a copywriter who built a successful world-wide advertising agency that was still going strong during the time I worked in the business. Much has changed since the heady days of the ‘80’s but I’m sure one thing hasn’t – the reliance on data to drive decisions and create value for businesses.

I find the giant personalities of advertising an inspiration – David Ogilvy has a well earned place on my bookshelf and was a real advocate of data-driven marketing. But I digress already – because Leo Burnett’s quotation captures the essence of what is on my mind this morning – that of excellence.

I was at the ballet last night. I saw a production of Romeo and Juliet that I had not seen before. There were some magnificent dancers and dances, but there were also some little slip-ups. Of course, the joy of a live performance is just that – you live the highs and lows with the performers; it is not sanitised as it would be for television.

For me, ballet is a treasure trove of riches. It pushes the human body beyond what should be possible to produce a spectacle so lovely that it takes my breath away. And last night it was all set to Prokofiev’s magnificent and memorable music. It is still going round in my head now.

The creation of a ballet reaches for the stars. But not all ballet companies are created equal. Not all have the same standards. Some reach, and attain, higher standards than others. Which was what got me thinking about Performance Management in relation to the performing arts. Ballet companies rely on businesses and business people to bring their productions to paying audiences. And those businesses also have standards as to what they accept or do not. Last night there were many empty seats – a crying shame considering the expense of the production.

This is where data and analytics meet star-reaching. I am sure there were many more ballet fans who might have been tempted out in the snow with the right offer. And the ballet company and theatre would have benefited even if the tickets were sold at a reduced rate. The right business intelligence system could have done that – to the benefit of so many.

I regularly go to see the ballet at another venue where there is just about never an empty seat. Do they have different standards or a different data-centered culture? Maybe both. Business Intelligence is a way of thinking. Maybe it's where ambition meets analytics …