Competitive Strategy: tech life cycle by social status summary

This chart summarizes the last chapter I read in the book Inside the Tornado by Geoffrey Moore. It goes through the competitive advantage strategy each segment should follow within the parts of the technology life cycle I talked about earlier.

Social Media Response

So, a while back I posted on social media's interactions with the pragmatists. Unfortunately I had to repost to get the comments feature to work. In the meantime my friend Austin posted his comment to my thoughts on his blog. I wanted to keep this conversation going here on my blog, hence this post:

Austin,

What I’m hearing is that innovation will keep growing, which we all know to be true, so pragmatists just need to suck it up and get with the program. That is also true, although it doesn’t respond to my initial point.

Pragmatists are by nature risk averse. They can’t afford the risk because it will hurt them, their career, or their company. Because of this they will not pick up a product unless they are confident it will fit their needs. They also won’t use a tool unless they are certain it will make them money. (I put a bit at the end about uncertainty) Currently, that concern is not yet resolved. This is what is required as a whole product.

It turns out that pragmatists are also the majority of the money in the world, working in the biggest companies, making the biggest decisions (hence the need for certainty).

I understand that innovation will keep going. It’s an engine that clearly will never stop, especially in the realm of social media. But I also know there is another force keeping acceptance low. My point was that social media has not reached the point yet where large companies and pragmatists in general are willing to take the risk to spend their resources on it yet. They won’t be able to make that move until they see something they are confident in, i.e. a whole product.

My point is that social media has not, as a whole, reached the point yet where they can guarantee a solution-even though some features may have (i.e. facebook for social applications, etc.) Once they can guarantee a solution to a problem we face that has commercial value, then, and only then, will the bulk of the decision makers in the business world get on board with it. Currently the only thing social media can guarantee is that you can get attention through it. We also know that sometimes that attention can be monetized, but as anyone in the social media world knows, you can’t bet on a viral video. In the same way we have no way of guaranteeing that a company will get a paycheck if they use social media. No one has consistently proven it, although I am certain they will in the very near future.

I am not saying any specific tool has to be proven. We know that Twitter works; we even know mostly how it works, and that it has potential. We know how Facebook can be used to drive awareness and can even house some businesses. We know that Youtube has been a successful tool to building revenue. Each of those tools a pragmatist is likely to pick up for its specific purpose. But where is the path to success? We have a ton of empirical data, but few models, proofs, or methods, and the data we do have is somewhat inconclusive. Clearly nothing has been proven yet. We clearly aren’t using social media to its full potential.

Let me get one thing clear. It isn’t that I won’t use social media. I’m not holding out, and I certainly will apply it to uses as I see fit, but we have not gotten to the point where we can use it as a guaranteed money maker...yet.

Once it is proven out, once we have a process that we can rely on for success, then the bulk of the market will follow. I love what you said about Apple, it is right on point. The reason Apple does so well is because it gives out whole products—exactly what a pragmatist requires. Their reward seems to be in the form of the bulk of the market share going to them, the proven, stable, market leader. Do not read this as that their products don’t have problems, just that they were able to offer a fully proven and accepted product.

Now, I anticipate a reaction about the need for certainty. I read what you said about companies failing if they are not able to adapt. This is totally true. Being able to act in the face of uncertainty is a mark of many great leaders.

For pragmatists, uncertainty needs to be faced with as much clarity as possible though. It’s all about weighing risks. Risk takers generally fall into the visionary category in the model described, whereas being risk averse is a quality of these pragmatists. This does not mean they don’t take risks, they just weigh them differently. They tend to be much more thorough or deliberate when weighing options and then tend to make sure their decision is as clearly illuminated as possible before finally making a decision. Yes, it is true that they will lean away from a risk when it is present, but taking risks is clearly a part of life.

Neither group is wrong for acting the way they do; it’s just a different approach. According to the way things work out in this tornado model, the visionaries will always have a bit more technology, but the pragmatists won’t let themselves be left behind. It’s all part of weighing the risks. Pragmatists are willing to be a bit behind if it means they can let the visionaries and techies work all the kinks out, decide which product is best though votes in the form of dollars, and through this tell the pragmatists who the most stable contender (i.e. the market leader) is.

Your line about not being able to comment on my blog is right on point. I did nothing more than give my blog a name and then post, yet the comments link was not there. It turns out I didn't need to change anything. All I had to do is repost, and the comments link is now available.

Is Social Media Ready for the Pragmatists

I am using a model from the book Inside the Tornado that I describe in the post just before this one. If you are unfamiliar with this model please check it out here.

There is a principle that has stuck with me since I was a teenager:

The truly rich don't talk about their wealth

Real winners should act like a win was no surprise

If you still have to talk about how mature you are, you aren't mature yet

The same applies to return missionaries and how "normal" they are (BYU reference)

I'm not the most eloquent person in the world, and I'm sure there is a quotable way to say this, but I think the point is made. Really, the concept is, why would they have to promote ____ if it is just a part of life. If you aren't at that point yet you feel compelled to tell everyone around you how much you have actually met that standard. Only a team that expects to lose has any excuse to rush the field. (There is nothing wrong with celebrating a win, I loved it when BYU beat Oklahoma last year...)

This applies to the visionaries from the tornado model in my mind. They are the promoters of an innovation. They are in the early stages of adoption. They are the 18 year old girl desperately trying to tell their 25 year old crush "how mature" they are. And we want to believe them. A new idea, a true innovation, could be a huge benefit to our world. But the pragmatist sees right through it, only accepting when it sees the situation as authentically reaching a mature state, a "whole product" as the book calls it.

Why are there so many people trying to tell me that social media is the new world order. Why am I struggling to believe them. How many articles, posts, classes, teachers, friends, etc. have told me that social media has been accepted, using valid statistics as proof, yet many of the generation older than myself struggle to find a purpose to Facebook, Twitter, Google+, Foursquare or whatever other tool they use, and big businesses are just now struggling to find its position within their company.

I am a pragmatist. I still don't have a smart phone (shocking!) and I don't plan to get one. It's not that I don't think social media is a great innovation, that I don't see the potential benefits of using it in a company. I plan to make it a big part of my business career. I just don't think the world knows quite what to do with it yet. It's not a whole product.

Pragmatists, having a herd mentality, have migrated to some of the social media sites. My parents have a Facebook page, and most big companies I am interested in working for at least have a LinkedIn account. I'm not saying social media does not have some whole products out there, but I think that the world that these social media promoters wish would happen is now sitting in the "Chasm" between the visionaries and the pragmatists. I think this is because much of the social media world is still at 80% and the visionaries are telling us we are crazy for not helping them with the last 20%.

Yes, there are benefits to twitter, foursquare, etc. I potentially can save time and be more efficient if I use it. But is it 100% clear how? I say no. I think the rest of the pragmatists would agree as well. It is a useful tool, but it is no "plug and play."

Currently I am in a Social Media Marketing class taught by a successful social media marketer (not a professor). The class started out mostly full with close to 30 students. After two class periods we only have 11 (update:9) students enrolled. Understandably, it is hard to have faith in a class that has never been taught before when it is being taught by someone who is not normally a teacher. I think the teacher has some very great things to share, has been successful in this field, and is teaching a much needed subject, which is why I'm still enrolled.

I think a big reason why people are leaving is the MBA program is full of pragmatists. It is full of people looking for careers in big companies. It is full of people looking for a full solution. While everyone accepts that social media will be a required tool in the marketing world, they do not see a full solution being offered yet. They do not see a "this is how you handle the social media world, works every time" solution being taught, possibly because one does not exist yet. They are looking for something solid to hold onto, not just examples and success stories. They want someone who has repeatedly and reliably been successful in social media to show them how its done.

Maybe I'm just ignorant. Maybe the solution is out there, I just haven't seen it yet. All you visionaries out there trying to defend your social media baby, don't just jump down my throat. Remember the 18 year old trying to declare her maturity. I know there are uses, purposes, techniques out there. I'm just not sure anyone has proven out a successful, scholarly, repeatable, and reliable way to handle social media yet, and until that happens the pragmatists will just have to wait.

Need for a "whole" product

Is Social Media Ready for the Pragmatists?

I am using a model from the book Inside the Tornado that I describe in the post just before this one. If you are unfamiliar with this model please check it out here.

There is a principle that has stuck with me since I was a teenager:

The truly rich don't talk about their wealth

Real winners should act like a win was no surprise

If you still have to talk about how mature you are, you aren't mature yet

The same applies to return missionaries and how "normal" they are (BYU reference)

I'm not the most eloquent person in the world, and I'm sure there is a quotable way to say this, but I think the point is made. Really, the concept is, why would they have to promote ____ if it is just a part of life. If you aren't at that point yet you feel compelled to tell everyone around you how much you have actually met that standard. Only a team that expects to lose has any excuse to rush the field. (There is nothing wrong with celebrating a win, I loved it when BYU beat Oklahoma last year...)

This applies to the visionaries from the tornado model in my mind. They are the promoters of an innovation. They are in the early stages of adoption. They are the 18 year old girl desperately trying to tell their 25 year old crush "how mature" they are. And we want to believe them. A new idea, a true innovation, could be a huge benefit to our world. But the pragmatist sees right through it, only accepting when it sees the situation as authentically reaching a mature state, a "whole product" as the book calls it.

Why are there so many people trying to tell me that social media is the new world order. Why am I struggling to believe them. How many articles, posts, classes, teachers, friends, etc. have told me that social media has been accepted, using valid statistics as proof, yet many of the generation older than myself struggle to find a purpose to Facebook, Twitter, Google+, Foursquare or whatever other tool they use, and big businesses are just now struggling to find its position within their company.

I am a pragmatist. I still don't have a smart phone (shocking!) and I don't plan to get one. It's not that I don't think social media is a great innovation, that I don't see the potential benefits of using it in a company. I plan to make it a big part of my business career. I just don't think the world knows quite what to do with it yet. It's not a whole product.

Pragmatists, having a herd mentality, have migrated to some of the social media sites. My parents have a Facebook page, and most big companies I am interested in working for at least have a LinkedIn account. I'm not saying social media does not have some whole products out there, but I think that the world that these social media promoters wish would happen is now sitting in the "Chasm" between the visionaries and the pragmatists. I think this is because much of the social media world is still at 80% and the visionaries are telling us we are crazy for not helping them with the last 20%.

Yes, there are benefits to twitter, foursquare, etc. I potentially can save time and be more efficient if I use it. But is it 100% clear how? I say no. I think the rest of the pragmatists would agree as well. It is a useful tool, but it is no "plug and play."

Currently I am in a Social Media Marketing class taught by a successful social media marketer (not a professor). The class started out mostly full with close to 30 students. After two class periods we only have 11 (update:9) students enrolled. Understandably, it is hard to have faith in a class that has never been taught before when it is being taught by someone who is not normally a teacher. I think the teacher has some very great things to share, has been successful in this field, and is teaching a much needed subject, which is why I'm still enrolled.

I think a big reason why people are leaving is the MBA program is full of pragmatists. It is full of people looking for careers in big companies. It is full of people looking for a full solution. While everyone accepts that social media will be a required tool in the marketing world, they do not see a full solution being offered yet. They do not see a "this is how you handle the social media world, works every time" solution being taught, possibly because one does not exist yet. They are looking for something solid to hold onto, not just examples and success stories. They want someone who has repeatedly and reliably been successful in social media to show them how its done.

Maybe I'm just ignorant. Maybe the solution is out there, I just haven't seen it yet. All you visionaries out there trying to defend your social media baby, don't just jump down my throat. Remember the 18 year old trying to declare her maturity. I know there are uses, purposes, techniques out there. I'm just not sure anyone has proven out a successful, scholarly, repeatable, and reliable way to handle social media yet, and until that happens the pragmatists will just have to wait.

Inside the Tornado review

They say that when you get a hammer, everything becomes a nail. I have been reading the book Inside the Tornado by Geoffrey A. Moore for my Entrepreneurial Strategy class and it's model is my new hammer. The book makes total sense to me, (even though every single example comes from the high tech industry, which I know next to nothing about) and I plan to write two blog posts about topics I think it applies to. I plan to write about how social media is not quite ready for the pragmatists, and how the Product Development program at BYU can follow the strategy laid out in the book and be successful.

In order to do that, first let me explain the model in my own words for those who aren't familiar with it.

The tech adoption life cycle pictured above shows five distinct categories of buyers or groups who accept a new product or technology. The first is the innovators. These are typically the engineers or techie type people who like stuff just because its new and cool. They don't really push the product into market, they just get it for themselves. Think of your friend that is the first in line at the newest iPhone release.



The second group is the early adopters. They are the visionaries: people who see real value in a new technology and want to exploit it. They usually have some money to put into the project. Some of their key characteristics are that they are grabbing up a new product before it is fully usable. They take a product that is, say, 80% complete and tell the inventor "We will work together to put together the last 20%." These early developers are risk takers and go in not fully knowing what the product is really capable of, but they know it has potential. They usually think, "Wouldn't it be nice if everyone had this technology, the world would be so much better or more efficient" etc. Typically they are a fairly small group in comparison to the market.


The third group is the early majority, also known as the pragmatists. To be sure I looked up what exactly pragmatism means from a dictionary standpoint. From m-w.com:

Pragmatism: a practical approach to problems and affairs

Basically, this model describes these people as ones who do not want a solution unless it is sure to work. They don't want an 80% solution, they want a 100% solution, or at least as close as they can get. "They are more interested in evolution than revolution" [Moore] and are more interested in making their systems work effectively and keeping the status quo. When they pick up a new technology they are sure to talk to their friends who have picked it up and ask what problems it has and who the market leader is. They then weight the options carefully. They tend to all move as a herd when a market leader is chosen because that market leader is seen as an infrastructure crucial to keeping the technology stable. This leads to the tornado the book talks about which is where the real growth of a company or the acceptance to a technology occurs. Before this happens, the product/innovation is still in its infancy, no matter how many people talk it up.

The last two groups are the late majority and the skeptics. The late majority, or the conservatives, only accept the product when it looks like they will be left behind if they don't. The skeptics rarely end up accepting the innovation, and if they do, they do so reluctantly.

The Chasm is the space between the visionaries and the pragmatists. There are some personality type issues that come into play which create this void, but I won't talk about those now. The bowling alley is a concept that will apply to to Product Development program strategy I will recommend later, but I won't talk about that now either.

Quickly, to start of this blog I would like to define it. I currently have a blog for my personal thoughts, a blog for my family, a blog for my family to post more essay type writing on, and a blog for my wife and I to post on. None of these blogs had the image that would allow me to create a brand around myself and none of them made sense for me to use for business concepts that are just beginning to come clear to me. Thus I created this blog. I don't claim to be a writer, and have never been one for spelling, but I hope to be able to write clear enough that someone out there might be able to use what I learn in business school and make a better life for themselves.

I am currently working on a combined degree at BYU. I am in the thesis writing stage of my Masters in Mechanical Engineering and my second year of the MBA program. The program is called the Product Development program and will be mentioned, I'm sure, in great length in this blog. Most of my MBA classes are directed toward a marketing emphasis and so much of what I talk about will be marketing focused. I hope to be able to use this blog as a way to study thoughts that are running through my head as well as generally take notes from class. I probably won't mention much about my mechanical engineering work because frankly I do enough writing about that already.

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