I personally believe our world, especially with so many feature rich products, is getting more complex every day. So, when I hear about simplifying products by removing features, I certainly applaud the action. However, there is a right way and a wrong way of managing features, especially when these features are already been introduced to the field and are in use by your customers.

Today, Netflix announced a removal of a key feature (at least it is key to me): multiple profiles per account. This valuable feature allows us to maintain several queues, one for each member of our household. For whatever the reason, Netflix has decided to remove this feature, and their FAQ is below. Note that Netflix is not providing any explanation, or an alternative to allow for an easy transition.

Jeff Lash of How To Be A Good Product Manager has a well written article on how to address feature removal from your product: Do not be afraid to remove features. Looking at Twitter traffic on this topic, Netflix product manager should be reading Jeff’s blog and revisiting this decision.

Should features be removed, and products be simplified? Absolutely! However, before one goes crazy over removing existing features, there needs to be a cost/benefit analysis and a good plan to handle the migration issues.

We will be eliminating Profiles, the feature that allowed you to set up separate DVD Queues under one account.
When? Profiles will be eliminated on September 1, 2008.
Why? While it may be disappointing to see this feature go away, this change will help us to continue to improve the Netflix website for all our customers.
Do I need to do anything? Consider moving all DVD titles in your Profiles Queues to your main account Queue. To do so, log-in and visit this page
How will this impact my account? On September 1, 2008:

• All DVDs currently at home or in transit will be associated with the main account Queue
• All Profiles rental history will be added into the main account rental history
• Your additional Profile Queues will be eliminated. If you would like to keep a copy of each
• Profile Queue we recommend that you print them out
• Prior to Profiles going away, we will also email you a copy of your Profile Queues
• Profiles movie ratings and Profiles Friends connections will no longer be available
• You will not be able to transfer your Profiles data to a separate new account
• You will be able to set a maturity filter on the main account

Technorati Tags: netflix, product management

The McKinsey Quarterly recently published their survey results on “Why multinationals struggle to manage talent“. Their result highlights the challenges that multinational firms are facing when it comes to managing global talent, and more importantly, how it can reflect on their financial results.

International assignments enable firms to achieve greater cultural diversity, innovation through better understanding of their target customers, enabling knowledge transfer between divisions as well as further development of company talent. Yet, many employees don’t view overseas experience as valuable career path, mostly due to the way companies handle international assignments. Based on their survey, McKinsey indicates that those who have done well in managing their global talent have the following best practices:

• Top management encourages people to get experience in multiple business units/locations across organizations
• Overseas experience is regarded as a prerequisite to promotion to senior level within organizations
• Managers are willing to or are offered incentives to lose their talented employees to other divisions, functions or geographies within the company

Along these lines, also check out Kai-Fu Lee’s (President of Google Greater China) Carnegie Mellon presentation “Google China — Can a Multinational Internet Company Succeed in China?” on YouTube. He discusses Google’s success in China and highlights key factors to their continued performance. During the presentation, you will also gain great insights into challenges awaiting companies entering China.

I was recently pinged regarding to the challenges of managing geographically dispersed teams. The wisdom below is based on my experience. How about you, are your observations different?

Overall, I found the leadership and management challenges of managing geographically distributed teams similar to day-to-day leadership challenges. However, distance, cultural diversity and communication differences make it even more challenging to ensure your teams are aligned with your values, processes and are working together towards the same goal with the same level of urgency. In my experience, I learned that I can’t assume that I am understood (even if I hear “yes, I understand” from the other side). I need to make sure to take the time to educate my teams on our processes, explain the context of my decision making process, discuss my values and how we do business in general. Establishing trust and good communication is essential in managing global teams.

Managing people, regardless of location, is a great reminder that I am in the people business, and not necessarily the technology business. With that, once the processes are understood and a few glitches are dealt with, the coordination process becomes smooth. However, when you are dealing with people, you will always have misunderstandings, miscommunications, etc. These tend to cause the coordination problems, and take the most effort to iron out, since you need to solve the root of the problem and not just deal with the symptom (such as coordination issues, misunderstood expectations, etc.)

Culture and language differences are yet another challenge to deal with. It is important to be aware of cultural diversity, as it can cause unnecessary tension and problems. Language and method of communication tends to be the bigger challenge. As an example, e-mail distribution lists are a great way to convey information and can be used heavily for decision making. However, the quantity and verbosity of email can be quite difficult for non-english speakers. So, your main issue is how to structure your communication such that your audience can understand and act on it as you intended.

When dealing with distance, I think there is always an aspect of out of sight, out of mind, which applies to both sides. Distance and time zones contribute to the challenges of communication and trust. In my experience a few hours of difference (such as the case of neighboring US States) wasn’t an issue. However, when you are dealing with differences of culture, holidays, work days (M-F vs. Su-Th) as well as large time zone differences (8+ hrs), you need to be aware of potentially burning out your teams. Active management of these issues (such as rotating meeting hours, face-to-face meeting locations, establishing quiet days, etc.) certainly helps.

I am a believer in over-communicating. I use face to face meetings (crucial, especially with very diverse teams and at the beginning and the middle of projects for best coordination), phone calls for 1:1s (personal updates), conference calls (web, video, phone, …) with my management staff, conference calls with all my teams, emails and instant messaging. Agendas as well as clearly stating the context of the issue and outcomes expected (including any boundaries, etc.) are key to good communication on both sides.

Technorati Tags: global teams, distributed team management

Previously I wrote about Gary Hamel and Lowell Bryan’s comments on innovation and how it will impact management practices and organizational design.

Now you can visit HBS Working Knowledge to read and comment about how you see the future of management changing: Where Will Management Innovation Take Us?

It is no doubt that innovation and the drive to continuously innovate is changing the way work is done and where it is done, how groups are led and organized, and how creativity is encouraged and tapped. Technology is also playing a key role in facilitating this situation, whether it is through social networks, forums, virtual meetings, development environments or knowledge management tools.

However, perhaps the biggest challenge to the future of management will be big corporations and all their bureaucratic bloated supporting departments. As important as the management process itself is to innovation, the alignment of the supporting organizational structures, such as the HR department, is just as vital in order to succeed.

Brought to you by the “Rambling Blogs” department of Kitetail.com.

Technorati Tags: future of management, HBS

Whether we you call it a knowledge-based, idea-based or innovation-driven economy, our firms’ value is more and more driven by our intangible assets. Dr. Robert Shapiro captures this quite eloquently in NDN’s Globalization report, “The Idea-Based Economy and Globalization: The Real Foundations of American Prosperity in the 21st Century.”

This shift is evident in the way U.S. and international investors value America’s public companies. In 1984, the market value of the physical assets of the top 150 U.S. public companies – their “book value” – accounted for 75 percent of the total value of their stocks. A firm was worth nearly what its plant, equipment and real estate could be sold for. By 2004, the book value of the top 150 U.S. corporations accounted for 36 percent of the total value of their shares. Nearly two-thirds of the value of large companies now comes from what they know and the ideas and relationships they own.

Intangible assets include things that are created through time and effort: trade secrets, copyrights, patents, trademarks, source code, know-how, organizational competencies (technologies, databases, culture, capacity for innovation), business processes , company brand, customer loyalty, and not to forget your skilled and trained workforce, i.e. human capital, all contribute to your intangible asset portfolio. Though these are not physical assets that you can see and touch, they can positively effect your bottom-line and the valuation of your firm. Here are some examples:

• Famous brands: Lexus, McDonalds, …
• Coco-Cola’s formula: Merchandise 7X
• Famous logos: Apple, Google, BMW, Nike, …
• Amazon’s customer review database, Google’s search database
• Trademarks: Kleenex, iPod, Trinitron, …
• IBM’s patent database

As important as these assets are, in most cases, management of them are an afterthought. Just like anything else, intangible assets require active management to support, to build and to grow in order to maximize their value while keeping the overall cost down. At the same time, for a variety of reasons, it is difficult to properly manage these valuable intangibles.

• Challenges of putting together an effective measurement system to track the performance of the intangible assets.
• Not spending adequate time to understand your core business, its key performance drivers and how they are linked to your intangible assets. But don’t stop there: learn to how to legally protect them.
• Only focusing on your intellectual property, and not properly analyzing/including your source code, know-how, business processes, workforce skills/expertise, …
• Neglecting to put together a risk management plan for your intangible asset portfolio to defend as well as advance your leadership position.
• Solely focusing on defensive moves while forgetting to find ways to nurture and grow your intangibles.
• Intangible assets may not have direct tangible impact, and very likely complement other intangible assets, such as the case with workforce training in software quality that eventually improves revenues through increased customer satisfaction.
• Treating your intangible asset analysis as a one time activity, and not managing them as part of your strategic business cycle.

To manage your intangible assets, start with identifying them and determining how they are linked to the success of your strategy and your competitiveness. Perhaps tools such as the cause-and-effect diagram can help narrow down the field while keeping it meaningful, relevant and long-term focused. Balanced Score Card performance metrics can also help to incorporate your intangible assets with your strategy.

Next, put in place a tracking and measurement system to monitor the progress of your intangible assets. Since it can be challenging to put together an effective system, keep it simple and start small. As I mentioned before, make sure your metrics are clear, actionable, support business objectives, and based on data and facts. Finally, build internal awareness for your most valuable intangible assets.

Technorati Tags: intangible assets

Stop, don’t dismiss or shrug away that little nagging, semi-irritating feeling you get after an interaction with someone in your organization. Ask yourself, “is this a common occurrence?” If the answer is yes, it is time to look at your organization and its culture.

What, how and why your organization does the things it does and how it behaves is a reflection of your organization’s culture. It is all about how you as a collective see the world, interact with the world and what rules you instinctively follow.

Take a step back and think about your organization’s culture. You might use one or more of the following characteristics to define it. Note some are more positive than others.

• innovative and high risk tolerance
• good attention to details
• focuses on results
• values people and team work
• aggressive with take no prisoners attitude
• creative and out-of-the-box thinking
• tolerance for ambiguity
• entrepreneurship focused
• customer centric
• collaborative, open and values trust
• empowered, self-managed, adaptive and agile
• quality work is a given and not an after thought
• need to know basis only; i.e. limited knowledge sharing
• does enough, but reluctant to go further
• ownership and accountability
• not invented here
• penny wise, pound foolish or otherwise known as frugal
• do first, think later or otherwise known as just do it
• …

Yes, the list can go on and on and on… And here is why should you care.

• Your organizational culture is linked to your firms success: Various studies and surveys indicating the link between organizational culture and firm’s success. Denison Consulting’ 2006 study links high performance in key areas of the organizational culture (adaptability, consistency, mission and involvement) to long-term financial performance and short-term sales growth.

  What do you think? Can you establish cause-and-effect links between your culture and other performance indicators such as your current customer satisfaction or employee motivation scores?

• Your culture can attract and retain talent: Individuals differ in what motivates them, what degree of social and community connections they need at work, amount of pay and benefits, as well as level of innovation, entrepreneurship, empowerment and risk taking in the company. Great companies not only create excitement and camaraderie for their purpose, but also build a culture that attracts the type of individuals that they need.

  Think about it… Are you attracting the type of talent you need to be successful in your business? What is preventing you from creating a company culture where you attract best of the best?

• Your strategy and culture are joined at the hip: Lets face it, your culture has a big influence on how your company does things. This influence certainly extends to your strategy. Just think about different generic strategies: cost leadership, differentiation, fast follower, … Each of these require a different set of cultural characteristics to be successful. Along the same lines, for any change in your strategy, you will need to identify the cultural behaviors that need to be changed and managed.
• Your culture can deliver 1+1=3: When you have a high performing organization, you can truly achieve 1+1=3! By focusing on ownership, accountability, action and results you improve your product and services using the same or fewer resources. By relying on their values and leaders, successful companies can decentralize authority to succeed in times where there is a high degree of ambiguity.

  As leaders, our every action sends a message to our people: dusty action item lists, reoccurring discussions with no specific decisions or owners, late start to meetings, runaway meetings, … Just a reminder, the buck stops with us.

• Your culture defines your ethical behavior: The world is transparent and becoming more transparent everyday. Honesty, integrity and ethical behavior is no longer a nice to have, but a must to demonstrate. Sure, you can put in place as many controls, checkpoints and policies as you want to ensure ethical behavior. But, to be successful, this ethics DNA must be embedded into your culture.

  The real test comes when doing the right thing is extremely hard: schedule slippage, customers’ personal data is compromised, lower than expected revenue results, … When that happens, and they will, how do you work as an organization: conduct open, yet difficult communications, take ownership for the responsibility, ensure joint accountability, …?

Finally, here are some of the signs that hints your culture needs work:

• second guessing/revising of decisions;
• execution issues and problems achieving results;
• inability to deal with or tolerate ambiguity;
• excessive workforce turnover;
• living in the past rather than facing to the present;
• loss of confidence in the leadership, direction and purpose;
• excessive politics and bureaucracy;
• firefighting mentality that rewards heroics;
• inability to innovate and risk adverse behavior;
• difficulty attracting and retaining talent;
• lack of respect;

Technorati Tags: organizational culture, why organizational culture important

The McKinsey Quarterly recently had a good discussion on the topic of innovation management (might require free membership to access the content). As Gary Hamel summarizes, the discussion is about the changes that are occurring with management practices and organizational designs.

How do you build organizations that are as nimble as change itself? How do you mobilize and monetize the imagination of every employee, every day? How do you create organizations that are highly engaging places to work in? And these challenges simply can’t be met without reinventing our 100-year-old management model.

Managing creatives, knowledge workers, freelancers, …, is not an easy process. It requires a careful balancing of freedom to explore and directing energies in a productive way that ultimately profits the firm and society. From Lowell Bryan:

These thinking-intensive people are increasingly self-directed. In fact, they’re directed as much by their peers as they are by supervisors. The management challenge is akin to urban planning. The art of it is that you must enable people to make thousands and thousands of individual decisions about how to live and work, but you have to create the infrastructure to make it easy for them to do so.

Insight from Gary Hamel:

The outlines of the 21st-century management model are already clear. Decision-making will be more peer based; the tools of creativity will be widely distributed in organizations. Ideas will compete on an equal footing. Strategies will be built from the bottom up. Power will be a function of competence rather than of position. In terms of the future of management, we’re at the beginning of what will be a fairly long journey. You can see some of the pieces starting to come together, but we’re not there yet.

And finally, Gary Hamel’s questions to the CEOs that are serious about innovation, which should be asked and compared at all levels of the organization:

• “How have you been trained as a business innovator? What investment has the company made in teaching you how to innovate?”
• “If you have a new idea, how much bureaucracy do you have to go through to get a small increment of experimental capital? How long is it going to take you to get 20 percent of your time and $5,000 to test your idea? Is that a matter of months or is it very easy for that to happen?”
• “Are you actually being measured on your innovation performance or your team’s innovation? Does it influence your compensation?”
• “As you look at the management processes in your company, do they tend to help you work as an innovator or get in the way?”

Enjoy the article.

Technorati Tags: innovative management, Gary Hamel, Lowell Bryan, McKinsey

Today’s WSJ published an article on IBM and virtual teams: How Teams Can Work Well Together From Far Apart (you might need a subscription). By using their global team, IBM has been able to cut down the development time of WebSphere from 18-24 months to 4 months. Based on the article, here is what makes the team productive:

• Have a common understanding of the task
• Clarify roles and responsibilities
• Set firm ground rules
• Get to know other team members
• Communicate often

Aside from wikis and instant-messaging software, the team breaks down the deliverables into small, well-defined chunks (these tasks are shared with everyone, globally and around the clock.) This, combined with the discipline to continuously update the wikis, helps to keep the miscommunication down. They also highlight the importance of communicating (even if it means interrupting someone) and being open with ideas and information.

It is nice to see a truly virtual development team environment that is also successful. If you know of any others, please share.

Technorati Tags: virtual teams, WSJ.com

The lack of white space management is one of the leading causes of project failures and delays, especially in siloed organizations. As frustrating as white space can be, its successful management and analysis can bring fruitful innovations and sustain competitive advantage to the firm.

So, what is white space? It is basically the gap, the fuzzy space and separation between what is known and understood. It is vague and ill-defined as to the ownership, the strategy, the process, the opportunity, … Yet, when it is analyzed and utilized well, it gives clarity, structure and emphasis to an opportunity or to a specific issue.

Our traditional project management processes are quite task oriented, where the focus is the successful execution of each individual task. No doubt you need to focus on execution. Unfortunately, constructing the forest one tree at a time works only if you have built the forest before and now working on an update. In this case, your main challenge is the hand off process, where your well-defined inputs/outputs and ownership, along with critical metrics will help reduce the size of your white space. If you are swimming in uncharted waters, you need to manage things differently and here are some ideas for your toolbox.

• Clearly understand what your customers value. In many cases, the cross-functional areas are in need of white space management, such as product installation, upgrades or 3rd party solution integration. Define the problem and key performance vectors from the perspective of the customer. Favor simple over complex and adopt the KISS principle as your motto.
• Setup a virtual war room to improve communication and coordination among teams. Make sure to include the updated versions of key project information, team member’s names/roles, competitive intelligence knowledge, project status, risks, milestones, … Leverage this to establish a sense of urgency that is shared by all.
• Use the staged-freeze process to group and manage critical tasks (Building a Project-Driven Enterprise: How to Slash Waste and Boost Profits Through Lean Project Management). As Ronald Mascitelli describes, this is very similar to building a house. You work with your builder to determine how best to schedule key decision points that support important building stages while accelerating work and reducing waste. After all, deciding to install in floor heating after the concrete floors are poured is an expensive proposition. You can extend this process to manage risk areas, resource constraints/schedules and key marketing events.
• Know, monitor and manage your critical path. These should be identified and regularly reviewed as the project progresses. Critical path is any activity that puts the complete project schedule at risk. Not only identify the risk, but also determine objective metrics to monitor their status.
• Utilize dedicated teams and task forces where possible. Many studies have already shown the impact of multitasking to productivity. If you can’t ensure dedicated teams, establish small task forces with clear charter, objectives, milestones, and metrics, where they are guaranteed to spend some of their time on these specific issues. Just remember not to go task force happy. It is contagious, and too much of a good thing can loose its value.

Remember, innovation is a system and new ideas come to fruition in the cracks: cross-functional areas, in between business units and products as well as shifts that occur within the value chain with partners and customers and market analysis. Middle managers play a crucial role as integrators and white space managers. This is especially true in siloed organizations where there is no one person that is assigned to managing the project end-to-end. Here are some of the characteristics of successful white space managers.

• They see their firm, partners and customers as part of the larger ecosystem. It is not about each individual group’s performance or ownership rights, but how the collective community operates together as a system.
• They recognize it is about the customer and creating that compelling customer experience. They continuously look for ways to go beyond traditional methods to create new value for the customer.
• They focus on the idea and the problem at hand and how it should best be handled as part of this system. They set performance goals that reflect the total system rather than separate parts.
• They recognize the glue that connects the dots is temporary, and look for ways to ensure the organization learns to self-sustain. This can be through coaching/mentoring, recommendation for structural changes and/or processes as well as influencing the organization’s culture and values.

Innovating in white space can represent quite a challenge for established firms. It is one thing to fund an idea, but another to push to full-scale implementation and commercialization while answering the strategic questions of who, what, where, how as Jeffrey Phillips points out. Here are key success factors to innovate in this space.

• Your innovation culture is key to success. It needs to have tolerance for risk-taking and failure, but also encourage experimentation, learning and recognition to challenge the status quo .
• Recognize that ideas need a platform for testing and validation. As a manager, not only support this process but also help ensure its success by providing the needed expertise, information and knowledge, ground cover during the attack, …
• Be creative and persistent as you look for ways to bootstrap resources. Focus on demonstrating value quickly while working with what you can gather up. Remember, it is about negotiations and making people realize they are getting more than giving.
• Engage your entire organization by “extracting resources from context to repurpose for core“, where core is your competitive differentiation (Dealing with Darwin: How Great Companies Innovate at Every Phase of Their Evolution). Include as part of your strategic planning processes the reapplication of critical resources to drive innovative projects.
• Ensure the support of a senior executive for your venture. This executive plays the role of a champion, sponsor, financial supporter, coach and mentor during your commercialization process.

In summary, in your projects remember to focus on both sides of the coin. Analyze and assess the opportunities embedded in the white space. Find those gems and polish them to improve your competitive standing. But, also don’t neglect the operational side of the white space. Focus on your execution to improve your efficiency, effectiveness and overall performance.

Technorati Tags: white space management, innovation management, middle managers, project management

There is actually a silver bullet for increasing your organization’s effectiveness: hire well. More specifically hire good leaders that will step up and raise your organization’s performance bar and set a new standard. Peter Drucker summarized this straight-forward recipe in his book The Effective Executive (Drucker Series).

…[Effective executive] knows, moreover, that the standard of any human group is set by the performance of the leaders. And he, therefore, never allows leadership performance to be based on anything but true strength.
…In human affairs, the distance between leaders and the average is a constant. If leadership performance is high, the average will go up. The effective executive knows that it is easier to raise the performance of one leader than it is to raise the performance of a whole mass. He therefore makes sure that he puts into the leadership position, into the standard-setting, the performance-making position, the man who has the strength to do the outstanding, the pace-setting job.

Exceptional leaders can deliver the impossible while building the organization, creating excitement about the future, enhancing communication and team morale while strengthening customer and partner loyalty. No wonder “bet on the jockey, not on the horse” is a mantra that drives VC investment decisions.

There are many studies on what constitutes an effective and exceptional leader. These individuals share some common characteristics:

• They challenge the established processes, search for new opportunities and experiment with new ideas. However, they do this in a participatory fashion where they are inclusive of others. They listen well, consistently request feedback, encourage and share and in return they are persuasive, persistent and as they tend to be politically savvy, they use discretion.
• They are focused on key priorities, keep it simple, celebrate small wins and are clear about their values. This enables them to build a compelling vision for the future, create a nurturing environment and provide motivation to rally a team behind this shared vision where everyone understands how they fit into the big picture.
• They understand the importance of accountability and ownership, for themselves and for the teams they manage. They enable others to act by involving them in decisions, and continuously look for ways to coach and mentor their team for individual growth. They build on other’s strengths and use it to motivate them.
• They focus on results and prefer to ask for forgiveness over permission. They share the rewards and recognition while taking responsibility for setbacks.
• They have a presence that brings credibility to what they do and say. They build confidence as they are thorough, professional and insightful.

If you are in a people management position and struggling with raising your team’s performance bar to the next level, consider the following:

• Do a self-analysis of your own management style, observe yourself in action and request feedback from others. Are you emphasizing accountability and ownership, or micro-managing everything short of chewing the food for them? Are you building on the strengths of your team, or just bluntly pointing out their weaknesses expecting them to overcome it overnight?
• Analyze your organizational circumstances. You can certainly build a dynamic and high-performance team, but your organization might have put the choke collar on you. Powerlessness over external resources, lack of cooperation, issues of trust and openness are certainly frustrating experiences. Some could be solved by organizational restructuring, for others you will need to sharpen your political savvyness.
• Evaluate the cultural aspects of your organization. Is it participative and inclusive, or more command and control? There is a time and place for different styles, such as in case of emergencies where command and control can be most effective. However, in general this style destroys motivation, creativity and lends itself to just tell me what to do attitudes.
• Study information and knowledge sharing patterns of your organization. Ideas and innovations are built on other ideas, and transparency/openness creates an environment conducive to sharing, understanding and motivating.
• Be honest, are there egos at play? Effective leaders learn to supress their egos in favor of the team.
• Take a survey; is the problem with lack of focus and having unrealistic optimism? Too much task switching reduces productivity, expectations that are obviously impossible to meet kill any potential for motivation.

At the end of the day, you need to model the way. Demonstrate your new performance standards by setting the pace, by having challenging, exciting yet achievable goals, by motivating and coaching others to contribute their best to the team. And, don’t forget to celebrate small victories along the way.

Technorati Tags: leadership, raise performance of teams, characteristics of exceptional leaders, high performance teams, effective leadership