Archive for category Management

On Flawed Market Research

There is a particular report that was recently released and has been heavily promoted through various publications. What I am referring to is a report by Strategy Analytics in which they claim that apparently Android has well over 30% of the tablet market because of some numbers that they collected. This post is not a rant about how iPad has a lot more than 65% of the market. Arguing about that is just silly. What this is about is how most companies collect statistics on business performance without even considering what it is that they are counting. Don’t get me wrong, it is not an easy problem and it’s made even harder by the fact that most MR companies offer relatively low salaries compared to actual consultancy jobs and hence they get employees with sometimes poor understanding of business. What blows my mind about some companies however, is that senior executives in those companies such as Neil Mawston don’t know any better and actually stand by crap like this. Oh and before I go any further I don’t know Neil and I am most certainly not associated with Strategy Analytics and never have been.

Here is the problem guys, you have collected shipment numbers for Android devices from manufacturers such as Samsung, HTC, LG, Motorola, etc. and then compared them to actual sales numbers from Apple. In a stable (read mature) market that might be ok because you can use some reasonable assumptions for inventory levels. The problem here however, is that none of the Android table manufacturers know how much they are going to sell. They are manufacturers and not retailers and the numbers that you get from them are projections of shipments based on orders that they have received or expect to receive. Well I’m here to tell you that orders get cancelled if a device does not sell well and they most certainly get scaled down. And all that is OK with the Asian manufacturers because they are used to getting stuck with unsold products. If recent months are any indication, Android manufacturers have grossly overestimated their own importance on the market. There is a clear lack of understanding the stages of product competition if you will and they have all of a sudden decided that it’s all down to competition of price when clearly the features stage hasn’t been passed. But back to the MR problem, you cannot compare retail numbers (Apple’s) with manufacturer shipment numbers (Android squad) in a growing market such as the tablet one. You have no point of reference for the growth curve of the market and trying to predict it is nothing more than an exercise in time wasting. Furthermore, without knowing what the market growth curve is, you cannot predict the difference between products being shipped and products being sold. What that leads to is an unpredictable level of inventory and any forecasts based on data like that would be extremely unreliable. Further more Mr. Mawston I very much doubt that you have any reliable information on the inventory levels that Apple keeps. In fact I know for a fact that your assumptions are wrong and also that Apple requires you to sign an NDA before they show you any performance numbers. So conclusions like “Android captured [a] 30% share of global tablet shipments in Q2 2011,” are laughable at best. Please do you damn homework and for the love of God take some MR courses if you must. I don’t know how you got to be at the position that you are at but I really feel sorry for the people that have to work under you.
Yes, a manager does not have to be the smartest person in the team, in fact you have a problem if he/she is, but a manager most definitely needs to know his/her stuff and you Sir do not!

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The data analytics age

I remember years ago when people were telling me how the information age is over and everyone was trying to come up with a name for what was to follow. Well guess what, the information age is not over. We are finally getting to the point where the Internet dream of having access to all sorts of data from anywhere is being realized. Increasingly companies and individuals are tracking their every day lives and creating digital records of their activities. Life hasn’t really changed much (well sort of) but what has changed is the fact that now you have a digital trace of most of your activities which makes data analysis of your life possible. If you are under 25 (or so) you can actually create a digital footprint of most of your life (well the bits that actually do matter) and if your are under 15 then your whole life has a digital footprint. You can analyse things like the amount of money that you spend, the types of activities that you like, your friends, the social groups that you belong to, and the list goes on. It is actually possible to analyse your own decisions and sometimes even predict your next one. And things are only starting in that aspect. Advertisers love it and so do marketing people. We are only experiencing issues related to ownership of digital content but what I thing is more important is that we have actually entered the age of data analytics. 10 years ago, history was only used as record of past events. You record events and maybe one they it is being passed down to the next generation as an account of what happened. It was a bit of an identity building tool. Today however, the history of your life is being recorded as it happens and we are getting closer and closer to actually being able to obtain real time analysis of those events. History is actually used more and more as a decision making tool and it even seems like you are having a communication with other people through their historic records. You read tweets, blogs, facebook messages and you comment on them. Within seconds the words knows what you think and you feel important and in control.
Fair enough, it doesn’t work the same for everyone and you still have a lot of people who’s voice is never heard just because they are poor but hey you get to hear the opinion of a lot more people than you use to even 5 years ago and that is another step towards freedom. Of course you realize very fast that you don’t really want to listen to 95% of the people out there because they don’t really have anything of value to say but hey freedom has it’s price. Anyway back to the analytics question. Like I said we are in the age of analytics and it is scary though that your life is simply being turned into a digital record of it and that whoever controls that digital record de facto owns your life. This is where governments need to step in and they really need to catchup fast. Now more than ever is true freedom at stake. Forget the constitution and all those innate freedoms listed in it. I think both Hobbs and Locke would find it very hard to explain who the enemy is today. Does Google really control the world or does the world control Google? What right does and advertiser have to know then was the list time you purchased toilet paper and what brand it was? Do you really want your car to know what music you prefer and does your car send out that information to someone else? Questions like this would become more and more important as we slowly move to cloud computing and as collected data becomes too large to be stored locally. I’m not saying that there are no solutions, but designing services should by law be made a lot more responsible job and there should be some universal data storage and sharing laws that ensure that you don’t become a victim of your virtual presence.

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Why Android’s team still doesn’t get it

Ok bare with me here. Android’s market share is growing very fast and yes I know it is quite popular but it is heading for a very rough reality check. The main reason why the market share is growing so fast has nothing to do with superior technology or great ideas. It has only to do with Android being better than the Symbian and Windows phones that it replaced and with the large number of East Asian manufacturers that are involved. For those it is indeed an improvement however, Google seems to believe that they are actually competing with Apple and they most definitely are not. They have never taken any significant number of iPhone users and there is a very good reason why as it stands they can never compete with Apple.

Yes, Android has a great promise and it is a good OS however, they have a huge problem and it comes in the face of Google Checkout. No offence to the Checkout team but it is the stupidest payment system ever. It has no recognition for the fact that you are selling to a global market and you have to use different currencies. If you have to use your bank to pay in a different currency then you will get hit by some massive charges and you cannot sell cheap goods like that. And if Google will be nothing than an advertising agency then why do they take 30% off your profits? Quite frankly Apple gives you a lot more for your money and it is no surprise that developers make more money there. You can release an application and sell it to everyone in their currency and you do not penalise them for living in a different country. Effectively there is no artificial barrier for the customer making the sale very easy.
And while Google might focus on technological improvements, at the end of the day they still make money from something else and since Google is not willing to pick up the slack you can bet that others will. There is an Amazon Market place which most definitely does currency conversion in the countries that Amazon exists and there are other coming out. Google is in fact in danger of being pushed out of their own operating system and that is just sad. I actually amazes me how business inapt the Android team is and how the crazy corporate policy that Google has is eating into their profits. I get it Google never uses services that compete directly with their own but when yours are clearly lacking you have to do something about it. Google needs to recognize that Android is no longer a pet project and is actually the future for Google. If you can’t fix Google Checkout please do everyone a favour and hire some financial gurus and please DO LISTEN to what they say. Otherwise Android is going to hit the glass ceiling a lot sooner. At the current rate I personally think that Android adoption rate will peak in 2012 and I don’t even think that it’ll be a flat line from there on.They will have to deal with disappointed customers and disillusioned developers and that does not equal a flat line.

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In search of the perfect project management system (continues)

Ok here is my position of project management software.
Maybe this does not apply to your business but it certainly does to mine so take it with a grain of salt.

GANTT is the biggest piece of crap I have ever seen. No offence to the creator supporters and users alike but you must be insane to use GANTT for small to medium projects. It has not concept of ease of use and minimalistic maintenance. Sorry, but my time costs money and it’s much better spent managing tasks and people than maintaining an insane system of resources, cost for those resources, time lines etc. etc. etc. Yes you need to know how much a certain projects costs and you do that in the feasibility study. Which by the way should never take you more than 1 days for mid size project. You should know how much the whole projects costs you and you should be able to analyse costs and efficiency after the project or a set of actions is completed but doing so should take you very little time. Also tasks have 5 states; planned, in progress, completed, delayed, and cancelled. I couldn’t care less what percentage has been completed and if you’d like to argue I dare you to tell me the difference between a 40% completed task and a 50% completed one.

Anyway so I hate GANTT with a passion. For my daily activities I need a system that is simple to maintain. Is based around talks and not milestones. Allows for changes in the plan, i.e. is flexible. Does not concern me with crap like resource distribution and most of all, does not waste my time. Well I have looked high and low and there is no such system. Yes there are semi academic management techniques that do all that and a bit more but I need a usable software. Well I found one that just might fit the bill. See I don’t need file storage/sharing because that is done on an internal Sharepoint because of security concerns. So all I need to be able to do it to share links. If you don’t have access to the network then the link means nothing to you even if it does get leaked.

Cohuman seems to do everything that I need in a very polished web interface. It’s not perfect and it is not exactly like my idea but it is pretty close. It look intriguing enough so that I would like to give it a shot and that is exactly what I am doing. So stay tuned and I’ll let you know how it goes. The first thing however, is that unlike Basecamp this thing has unlimited projects and only has a limit on storage for the accounts. It is still a new product by this start up that just got some more VC funding.

Oh and if you want to know more about my project management pet peeves, take a look at my older post.

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Pricing and Licensing

[republished due to wrong location]

 

For everyone creating a product, pricing is a a very important issue. You don’t want to scare customers away but at the same time you want to get as much profit as you can. There are books and certain academics devote their whole lives to the creation of right pricing theories. I am not going to pretend like I know much about the subject. Basically, these are just my thoughts on the subject and that’s all.

Recently it’s becoming quite an issue for content publishers too. Publishing materials in a digital format brings it’s own set of issues. You see paper publications never last forever and often last for roughly 5-10 years. Electronic ones on the other hand could last forever! Also you can easily copy them and have multiple people using the same initial document at the same time. Now that is something new and causes quite a big problem for publishers. There is no longer the need to buy several copies of the same book. Also the perceived value of a publication decreases with digital publications.

There is no doubt about it, it would take a generation change for the problems to get resolved. Sociological aspects aside, what should you do today? I think you should be very careful when you decide on pricing of digital editions. You pricing HAS to be perceived as fair. You are not competing only with your regular competitors. You are actually competing your yourself too! If you are still publishing on paper then the digital edition competes with the paper one. Otherwise you are competing with yourself from yesterday. It is the perception that your prices have gone up that you want to avoid. And the perception that your prices have gone up brings governments down and most definitely destroys companies.

Consider this, you are saving some money by not paying for paper and printing. You are also able to publish a bit faster, hence you should be bring in a bit more revenues. You HAVE to pass on the savings, i.e. sell for a lower perceived price!

A word of warning to companies that charge based on different licences; why are you asking people for more money for the same product? Did it cost you more? If the answer is no you should know that there is something wrong with your pricing strategy! What you can however, do if you are a consultancy that produces syndicated reports, you can include a presentation of the results and charge more because of the included extra seats at the presentation. Now I am not saying that is really the way to go. The point is that if you charge more you have to offer perceptionally more! The last thing that any business wants to do it make the customer feel cheated. If you do, you will pay the price sooner or later.

Anyway, pricing goes much further than this, but the thing to remember is that you are in a market place and a market place is where you and your customer come together in agreement! A quote from Bill & Ted’s Excellent Adventures comes to mind. I went something like “Be excellent to each other” and on that note I leave you …

 

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On useless market analysis

One of the things that I have started noticing lately is how useless certain market analyst reports are. The most recent ones are the Gartner and IDC PC sales reports. They are different yet both seem to have copied the exact same ridiculous template for the tables. Here’s a though to both, if your Others category is a larger percentage than the largest manufacturer in the market … YOU HAVE SCREWED THE POOCH! It goes even further though. Even when the Others category is not that large it is still the 3rd largest one and that is just wrong.  Yes it is much easier to collect numbers from 5 manufacturers and use an estimate for the rest but it makes for a very low quality report. I couldn’t care less about the numbers however, reports are supposed to present collected performance data and analysis of things such as risks, level of competition, trends in consumer preferences, etc. Now exactly how are you going to do that when you know very little about over 40% of the market and what would your margin of error be in that case? Or maybe you need a clarification on what margin of error means?

It is sad when respected companies such as Gartner and IDG publish crap like this. Yes it is a quick hack job and yes most computer manufacturers don’t really care about the report but did you ever stop and think that maybe they don’t because you are actually not telling them anything that they don’t already know? Did you think even for a second that a company like Apple, or Dell does not have it’s own team of business analysts? They know very well how the company is doing and their forecasts are in all likelihood a heck of a lot more accurate than Gartner or IDG’s.

Oh and on top of the mediocre tables that IDG uses, the analyst even goes so far as to suggest that Apple and the iPad are responsible for Acer’s decreasing market share … uh really? Exactly how does that add up? Acer is a low cost high volume company where as Apple is a high cost low volume one. In what world would they have the same target customer? (pick up a basic Econ book if you really don’t know what I am talking about). What most likely happened is that high end PC users have switched over to Apple’s camp and they have mostly been replaced by low end ones from other PC manufacturers due to the said manufacturers providing inferior products or a slightly higher price. It is basic economics after all and no offence but you are confused by things like this maybe it’s time to think about career change …

Anyway, I guess what I believe in is that any market report should focus on the analysis of the data presented and should treat data as a by-product of the process. Tables and numbers alone might make for great newspaper articles and blog posts however, they alone are worth very little to management!

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How much vacation do you need?

So it’s the holidays and I just had a somewhat heated discussion with my gf about vacation so it got me thinking. How much vacation is actually enough? How important is vacation time to you? Often employers use vacation time as a benefit and tell the employees that they get x amount of vacation time an because you get more vacation from company A it is better than company B but is it really?

When did time off from work become a benefit? Do we really live in a society where you sell your soul to a company and then they have to let you off and allow you to do things? I don’t think so. Look it is not about being lazy. It is about selling your time to the highest bidder and I don’t mean in monetary measurement. You are at the end of the day selling your ability to do something … anything for someone else. You are the seller and you are not the buyer and I don’t know how somehow along the way it all got switched around. You see one thing that people seem to forget is that it is the employer who competes for talent and workers and not the employee who competes for whatever. Your employer would love you to believe the latter but this is not the truth at all. And it is not just that, you have to put yourself in a position where you are selling something valuable so that you can get the best price for your time and abilities. Once you do that, you shouldn’t forget that it is not just when you find a job that you are selling things. Every time you get a performance review, you should look at it as an opportunity to sell yourself. Don’t settle. Anyway, I digress.

So back to the vacation question. How much time off from work do you need? 2 days a week (every week)? 3 days a week with the ability to combine them? See here is the problem for me. You get into the routine of thinking that you work 5 days and you are off for 2 and then you start living for the weekend. But that’s wrong. You are limiting your potential because of a stupidly designed schedule. It all get’s back to an unimaginative managers and scheduling that is not based around creativity and kills creativity. Do you really think that you can predict your company’s progress by making sure that you have people working for 8 hours at a time? Fair enough, some jobs take no creativity and you have to turn your brain mostly off to do them. Those, jobs usually require that there is a semi-automaton there for a set period of time. Those particular jobs would one day be done by robots but as it is, are done by people. There you can schedule and manage people like we do. However, creative jobs should not be a 9 to 5. You should feel at work 24 hours 7 days a week, and yet not feel at work for the same amount of time. You could work one day for 12 hours and the next for 2 because the project is not going anywhere. But you need a flexible schedule. Actually, if you give people enough freedom so they can take care of their personal life and be creative, you would be surprised that they actually would work more than before and be a lot more productive per hour of work than before. It does take a complete retraining of your brain and I suppose a does of ADD. Quite frankly I think every creative person must have ADHD to some extent. You have to be a bit chaotic and not be able to follow rules in order to be able to create something. You have to be challenged by the current system in order to be driven to innovate. There is no other valid explanation for me.

And as far as amount of vacation time goes, who cares how much time off you take if you feel like every project that you work on if your own? It won’t matter that you are not at the office for 30 or 40 days a year. After all you don’t need a preset physical location to work. I personally think that every creative profession should be treated as a free lance job only you do get benefits and you are a part of a team and a company. But hey I am no fool. I know very well most managers are terrified by the unknown and the unpredictable and most of them believe that there is no chaos theory. I know that no medium to large company would ever allow their teams to be free spirits. Google get’s somewhat close to it on paper (Fridays are for your pet projects) but in reality it is not like that. So we maneuver the system as much as we can an keep fighting for days off and as much benefits as we can.

Oh well, Happy Holidays to us all !

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