I recently got an oil change at one of those quick-change places– you know, the ones that smell like burnt coffee? It got me thinking– this is a market that will exist for the foreseeable future. It’s also a commodity market– they all compete on price and there’s little product/service differentiation. It’s also a bit of a confusopoly. But does it have to be? Continue reading “Change the oil change business”
You know what? Failure friggin sucks. Seems like there’s been a lot of buzz over the past few years about Failure Chic– how it’s ok to fail. It’s ok to crash & burn. But it seems to me that most of these blog posts and articles are written by people who’ve never experienced true failure. The kind where you’ve put in everything you have (and then some!)– money, emotional energy… even years of your precariously short little life– and yet you find yourself holding the shattered scraps of a once-vivid dream. There are no redeeming qualities about failure. Saying “but I learned from it” is just a lame attempt to rationalize that steaming pile of cognitive dissonance slopping around in your brain. I think our recent glorification of failure is an #EpicFAIL. Like cat-stuck in-a-birdcage-fail
Because we can learn from our successes just as much as we can from our failures. So, what I’d rather see is a switch from Failure Chic to Learning Chic. Steve Jobs said he realized after he was ousted from Apple (sorry, obligatory Apple reference) that making awesome stuff in an awesome company should be the goal rather than profits. Success should be a byproduct of a lifelong love of learning.
So, forget failure. And forget success. Let’s learn how to make awesome stuff.
I predict failure (compared to revenue from previous versions): Rock Band 3 uses “real” guitar and keyboard.
Guitar Hero worked because it was just hard enough to appeal to everyone who always wished they’d learned guitar, as well as all the people who already knew how to play guitar (but not video games). They found the sweet spot that captured gamers and non-gamers.
Rock Band 3 is only going to appeal to hard-core gamers who also happen to be able to play a real instrument. See I Fight Dragons (love them, btw).
Classic case of an incumbent riding a decaying product line all the way to the grave. They’re so focused on trying to recapture their glory days, they’re blind to opportunities on the periphery.
What could the guitar-game companies have done instead? Two ideas, based on the strategy of exploiting second-order effects:
- Capitalize on the growth in mobile apps and tie it back to your core (console games): an iOS and/or Android app that uses WiFi to act as a controller for existing games.
- Capitalize on the trend of all-things-social, and keep people coming back with game mechanics: Something like Garageband that makes it easy to create/record/share your own music, but with some strong gaming elements (e.g. submit songs for peer rating, prizes for highest-rated). Garageband with some social gaming elements.
The Internet changes everything. Also: water is wet, and Conan O’Brien is ridiculously tall. Seriously, if you haven’t realized that yet, just go back to living in your cave. If your product can be turned into ones and zeroes, your existing business model doesn’t work anymore. Your strategy probably relies on scarcity of physical goods.
Scarcity can still be a viable strategy, but only if you refocus on things that can actually be kept scarce. Here are three ways to use scarcity as a strategy in a digital world:
- Trust: what’s more scarce than trust? Ok, yes: good music put out by major record labels is pretty scarce. Other than that? Not much.
- Customer service: if I can get your particular combination of ones and zeroes cheaper some places, and completely free other places, why should I fork over my money to you? Because I know you’ll take care of me.
- Expertise: give away the “product” but charge for service– think Red Hat. Linux? Never mind, you cave-dweller. Red Hat distributes a version of the open-source operating system, Linux, for free. They make money by charging customers for service– e.g. setup, maintenance, trouble-shooting, etc.
Along the same lines, just digitizing existing stuff leaves your customers wanting more, and your competitors with an opportunity. When you redefine your unit of value– what you charge for– be prepared for the accompanying change in what the market expects, and how customers consume your product.
Suggested reading: Change This – Better Than Free
I work for a big corporation. As with most big companies, the corporate hierachy is pretty tall. That makes it a bit tough to create and/or maintain a culture of innovation: politics and title are usually more influential than a good idea. But blaming management for not accepting your brilliant idea is a cop-out. What if Al Gore gave up on inventing the Internet “because his boss said no?” You don’t want to be a cop-out, so you work the system to make friends, and influence people. But that’s a little like pushing spaghetti uphill. Instead, you could sidestep that whole mess and at least get a running start.
This is where social networking can be more than just an interesting sideshow. There’s a great tool called Yammer. It’s like Twitter for private networks. Maybe I’m slow on the uptake, or maybe I just have a profound grasp of the obvious… but one thing I’ve noticed is that Yammer is (relatively) flat– it completely sidesteps all the day-to-day corporate hierarchies. The CEO and I are somewhere around 6,269 levels removed in the official corporate structure (not to mention half the land mass of the US and then the Atlantic ocean). But on Yammer, we have the opportunity to interact as equals. Most innovation articles I’ve read suggest that flat is good. Flat means that the best ideas— not politics or title– attract the best people. What company wouldn’t want the best people working on the best ideas?
So, since this is all about me, let me help you understand my context. Lets go all the way back to my elementary school– an “alternative” school with an integrated curriculum. We weren’t taught discrete subjects in separate classrooms; we were taught how to wonder. How to learn. And we learned nothing in a vacuum– everything was related. For example: when we read a book about the revolutionary war, our art, science and writing projects related to the revolutionary war. That was invaluable preparation for life and business. Few things in our lives are ever truly done in a vacuum, and when presented with something, I always try to understand the “why” or the “so what” or the “what next”.
What next? Understanding without insight is like a guitar without strings: I’ve got this beautiful instrument, but all I can do is admire it. Insight is seeing patterns; connecting seemingly unrelated things, like mahogany and catgut, to create an instrument that can reflect the trials and triumphs of humanity.
So, now you know a little more about me and my story.
Jujitsu is a martial art based on the idea of “using an attacker’s energy against him, rather than directly opposing it.”