What Is Tech Transformation?

What Is Technology Transformation?

Edited transcript of a speech to the Southern California Software Council’s Impact! Dinner in Los Angeles on January 18, 2001, by Riggs Eckelberry.

[Opens with a discussion of NetCatalyst and its role as a Liquidity Engineer, intervening actively in companies on an M&A focus.]

Now, I’m going to quickly segue to what I’m personally working on, which is how to approach the problem from the inside out. And I call this process Technology Transformation. It’s an end-to-end process. And it seems to me that if you start at one end with technology, and the other end with a successful business, a dominant, hopefully successful business, then you’ve got a lot of way stations, a lot of milestones and elements you need to have in place. You can kind of gauge the health of the Technology Transformation process by looking at how well each of these elements is doing.

Now Technology Transformation in my opinion is why we are where we are today with all the dotcoms: an inability to transform technology, sometimes quote unquote great technology – but technology nonetheless – into business success. Again and again I’ve been confronted with people thinking technology was the answer, when really, the question is, in the end, how many devices can people have? (…and interfaces, relationships, communities, you name it). So, there’s a real problem, I think, of too much technology and not enough “sponge”, not enough absorption.

I’m going to quickly talk about some of the elements of the Technology Transformation continuum.

It starts with the Technology Assessment, of course. “What do we have, what’s it about”, being very aware of the wealth of the asset. I was involved with a startup three years ago that actually launched without a product – it was a tough year! Schwab says there are noble failures… well I’m glad this one was noble.

The next step is the Marketing R&D process. I’m a big fan of what I call mistake-based marketing. That is, getting out and marketing to your audience (or what you think is your audience) fast, and then learning what you’re doing wrong fast enough that you can go into these really tight iterations, and actually break down the cycle of “we’re going to market for nine months and then we’re going to… oh, oops”.

And then, “Version 2.0 will fix all this”, “let’s do some focus groups”, “usability studies tell us it’s hard to use”… Well, if you’re there, then you’re nine months too late.

Various terms like sample code marketing, iterative or adaptive marketing come to mind. Also, this is where you learn what is your present and what is your future – the assessment of your present and future.

Finally, this is where you get that wonderful focus that we've discussed. Focus is what Trout & Ries talk all about; Focus is my favorite book, by Al Ries, and it’s in the pantheon.

So now you’ve got your focus, and now you develop a Trial Strategy, you get your Financial Sizing and your Institutional Feedback – obviously. I’ve learned that there’s not a marketer out there today who can survive without being fully aware of what it takes to get M&A transactions done, and funding, rescue financing, bridges etc.

In M&A alone, I believe that high tech will continue to grow on the basis of acquisition; either for funding purposes or strategic purposes. You’ve got to be very, very close to that game.

Next item is the Productization Process. This is a huge subject, as you know. Productization is probably the biggest chunk of the Technology Transformation process. I’m a big fan of product management – you know, what the high tech industry defined as product management and product marketing.

High tech, I think, is unique in that it pioneered marketing being in charge of product, and driving it and having ultimate product responsibility. I submit that the high tech marketer, the product manager really drives the whole ship. There’s a process, I’m not going to go into it – MRDs[1], Functional Specs, all the wonderful tools we have. I personally think we should try to keep those in mind, and educate those coming over from Polaroid consumer branding that there is such a thing. I don’t want to dis[respect] Polaroid, but any consumer marketer clearly will not know what high tech marketing’s about. It is a technology and a process.

Furthermore, this is not a committee process. I’m just going to say that and move on; committees are very unhealthy to the productization process in terms of decision-making environment. It’s got to be driven by someone who’s in charge.

The next major issue here is Adoption Curves. Again, we've talked here about the tornado, the technology product life cycle, everything from the early adopters all the way through the laggards, and it is incredibly essential to read and know Inside The Tornado inside out. And Geoff Moore's Crossing The Chasm as well.

Adoption curves basically say “look, not all audiences are going to adopt everything all at once, and you had better work out a good roadmap that gets you there”. That also comes back to culture, which I’ll talk about in a second, and it has a lot to do with CRM (Customer Relationship Management) too.

I think that at that point you start looking at your Channel Marketing, your Alliance Marketing. We’re done with just rushing out there and creating an environment in which to create a buzz.

No, there are buzz creators out there, there are partners out there that can bring you your audience, it is a mature market in the marketing sense that lets you take the building blocks of “hey, this audience, I’m going to get four million people here and then convert them here” … well this has all been pretty much sized out. From here on out, we’re not going to have huge paradigm shifts of people coming on the Internet and getting excited about X, Y or Z – it’s just a question of what are they going to get excited about.

So that’s good news. The next one is Category Domination Execution; what a certain VP I knew called “snuff campaigns”. Which is basically how do you dominate your market completely through marcom, community-building, PR.

It brings to mind that we saw a lot of major broadcast advertising happen in the last year. We know as software people that major broadcast advertising exists to enrich the major broadcasters and the major ad agencies, and it is fool’s gold as far as dotcoms go, or any high tech environment.

I’d rather spend money on user groups. I recall marketing to user groups, and I believe something like that approach, a much more dialog-driven approach is the only way to go, as you agree I’m sure.

OK, next key one, Infrastructure & Service. I think that the wireless carriers could do far better than doing a bunch of ads, just concentrate on getting better coverage between A and B. Personally I can’t believe how bad it is.

Of course, the book tells us that, inside the tornado, when you’re in the tornado, customer service doesn’t matter, and you’re just there to grab share. And that’s perhaps true up to a point, but I think that the Technology Transformation continuum requires that you look at your infrastructure requirements and what it’s going to take to maintain quality of service.

And there’s a related point, which is Scalability.

OK. At this point, we know we’ve scaled a business, we’ve hit the market, we’ve gotten our adoptions, we’ve got all these great, sophisticated things that we've discussed in this panel… There’s a very critical thing that happens here, which is ongoing Transformation Of The Culture in the company, and of your model – of your product model, your service model.

Again, Inside The Tornado talks about how an organization changes itself, based on where it is in the cycle; you know, is it talking to the wild-eyed individual innovator way out in front; is it talking to the "whole product" implementers, the people who want a complete product; is it talking to the audiences in the tornado that are just grabbing it whether it works or not… it’s a different company, a completely different company in each case.

Companies stumble big-time on the inability to change their culture. I think in fact Geoff Moore talks about it... when a company is in the tornado, it’s: “We’ll close the deal and have champagne in Kuala Lumpur!” and, well, this doesn’t work in the other stages.

So, clearly identifying, figuring out how to leverage the company into these new cultures is the enduring problem. For example, Lucent were a certain kind of company, and they needed to become a different kind of company to fit where they really are now. This is a huge problem and one that may deserve your attention.

Which bring us to the end goal of a successful business. I think that this lays out these milestones, and personally I think that this is a workable tool and I submit it for your consideration.

And, please, I welcome your dialog, and I’ll be glad to fill you in as I develop more working tools for this. Thank you very much.

RIGGS ECKELBERRY

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[1] MRD: Marketing Requirements Document. What drives the development process. (back)