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JT
> As always you have a sharp eye for detail. However, I could disagree with
> you on several points.
>
> Rather than what Leif suggested, I would suggest we take this topic
> off-line, if you want to debate.
No JT, there is no point. Please don't make factual statements in public
relating to me that are inaccurate.
> While I got you "on the phone" let me ask you this: I visited the IAiC site
> today, for the first time since I "un-joined". I was looking for one
> particular paragraph, for a letter I'm writing to someone at IBM. It was
> the one that listed 4 steps to collaboration. I couldn't find it. If you
> feel like it, and you know the post I'm referring to, can you e-mail it to
> me PRIVATELY please. TIA.
I don't know why you cannot find it on the site. I have not removed anything
and
I don't think Joe has.
I presume you mean one of the letters to Zeitler.
I have pasted in here the text of both. Hope that this is what you want
------------------------------------------------------------------------------------
October 24, 2000
Introduction
As I said in my previous letter, it appears that the
iSeries is your ticket to short-term profits as well as long-term growth.
That's
an unbeatable combination.
The architecture of the 400 is also unbeatable. The
primary design principle was to be able to grow over time. It has a 20-year
track record that clearly demonstrates the validity
of that principle. Given that track record, it is clear to see the platform can
continue to grow at both the top and the bottom.
There is no doubt that, given sufficient resources, the iSeries can grow to take
any shape or form that would be required in the next
20 years.
IBM demonstrated clear vision to see the inherent
value of the Internet. I believe that same clear vision is necessary to see
that
the iSeries has the most potential to help IBM
realize the full value of the Internet.
Some or all of this may be obvious to you. It may,
or may not, be equally obvious that the only way to accomplish these things is
through dramatically increased sales. It may be
obvious that the only way to do that is by empowering your customers to help you
accomplish this. I belabored the points above,
because I think they justify your making this extraordinary effort to empower
your
customers in this way.
Optimal solution
I am relatively certain that the optimal solution,
to
the question of how to dramatically increase sales of the iSeries line,
primarily
involves two things:
1.Ramping up manufacturing capability (because
the
new N.Y. facility won't be online soon enough)
2.Assisting your customers so they can create
both
a non-profit and a for-profit organization dedicated to advancing the use
of the iSeries
Why
Point #1 should be clear from the third quarter
sales
of iSeries and pSeries eServers.
Point #2 requires some explanation. I hope you can
bear with me on this one.
There are several ways a new user organization can
help the iSeries, and all of IBM:
One way, as I mentioned in my previous letter, is to
help organize and administer a program where enthusiastic customers can go
on sales calls to educate potential purchasers about
the advantages and disadvantages of the iSeries.
Another is to design, develop, and deliver the best
possible education on any and all aspects of the iSeries--free of charge to
members. This is a component of the idea to send
volunteers to potential customers. The free membership to the organization
could be used to entice volunteers. But the aim is
much broader than that. The problem today is not lack of educational material,
but lack of usable material. In fact, the problem
is
often too much material. This organization can determine how to make the
vast amounts of information accessible to the
customers. If the necessary materials are not available, then the group will
need to
develop them.
Yet another way this organization can serve is to
provide objective "propaganda" to the media. This is a very promising area
because this can be accomplished by a small,
dedicated group. It doesn't require as much coordination as other projects.
The
group can act as a watchdog over the media, keeping
a
vigilant eye over misconceptions and out-and-out misrepresentation of the
facts. Keep in mind however, that for this area to
be included in the non-profit organization, anything written would need to be
objective. Fortunately, the objective facts favor
the iSeries.
But possibly the biggest ways this organization can
help both IBM and the iSeries community are:
1.By clearly identifying the markets' current and
future needs
2.By promoting communication between IBM and the
market (and it's customers)
From what I'm seeing, it is extremely difficult for
IBM to gauge what the market really needs. Especially given the fact that the
market itself does not know what it needs. In an
interview, Mr. Jarosh said that the integrated product development (IPD)
process was put into place specifically for this
purpose. I'm not talking about replacing that process, but augmenting it with
another view. I'll give one brief example of where
the IPD could be improved. My understanding is that the iSeries DNS is
wide-open to attacks by hackers, and that it has
been like this for several releases of the OS. Nobody can look a potential
customer in the eye and say the iSeries is a good
eServer if these facts are correct. I got this from a pretty reliable source,
so
I
would say this is one example where your customers
can alert you, in advance, to serious problems that might slip through the
cracks.
A similar, but unrelated, area this organization can
help IBM is by keeping "it's finger on the pulse" of the marketplace. By
reading
the pulse and reporting the findings, in writing, to
the appropriate area within IBM, the organization can perform a valuable
service. Again, I'm not suggesting that this should
replace the market research and focus groups that are currently being done.
This information can be used to improve the current
market research.
The above examples show how this organization can
help promote communication between IBM and it's customers in the areas of
product development and marketing. But better
communication is a deliverable in its own right.
Customers have problems that IBM can easily
solve, if only the customer knew who to call. This organization can help route
problems to the correct department in IBM.
All customers are going to have an element
that
rants and raves. This organization can give these elements an avenue to
rail against you. The ranting can be siphoned
off, and the cream of these ideas can be presented in a reasonable way.
This organization can act as an agent of
change. This organization can pound the iSeries community on the areas they
need
to improve on
Funding
I believe this organization can be funded by annual
dues in the neighborhood of $100 per individual. There may be a use for
corporate memberships priced on a sliding scale
depending on annual sales. I think these amounts are easily justifiable by the
free education and other benefits. I don't have an
opinion if vendors should have a special class of membership.
I also believe that this organization will provide
monetary benefits to IBM. I would think that certain areas would have to be put
into a for-profit "feeder corporation" that would be
owned by the non-profit organization. I believe certain of the activities will
not
qualify, by law, as activities of a non-profit.
(For
example volunteers going on sales calls and providing what's basically market
research.) I'm not a lawyer, and I haven't done
much
research on this to know exactly which activities would be in which
corporation.
I believe increased sales, along with reduced
expenditures in some areas, would justify IBM paying for the services of this
for-profit
enterprise. This would probably end up being the
primary method of funding the activities of the non-profit organization.
The other reason for the division between the
non-profit and for-profit corporations is that it is, in my opinion, absolutely
critical to
maintain an independent organization in order to
maximize both the organizations' dealings with IBM and it's contacts to people
outside the iSeries community.
Conclusion
I lot of what I've written here could apply to any
of
your products in the eServer line. I believe these ideas can get the biggest
bang for the buck if used to promote the iSeries. I
say this because the iSeries can join with the pSeries to form the "bSeries" (as
I
stated in my letters to Mr. Gerstner). This
computer
would be in a class by itself. The "bSeries" can grow upward, it can grow
downward. It would simply be the best and most
marketable computer available.
But the reason these ideas will work best with the
iSeries is because of the extremely large and loyal customer base that it
enjoys.
The many people who are active in the forums could
create a momentum that could increase the number of members in this
organization.
--------------------------------------------------------------------------
October 19, 2000
Introduction
From everything I can tell, the following
assumptions
that I'm using are correct:
The iSeries 400 has a good profit margin
The 400 has the best customer loyalty of
almost
any platform
Customers that get a 400 tend to stay with it,
and purchase upgrades for it
If these assumptions are correct, it appears that
the
400 is your ticket to short-term profits as well as long-term growth. The
resources spent getting new 400 customers would
return immediate results, and at the same time, insure future profits. The
acquisition costs of new 400 customers can therefore
be spread over a longer period. This is an excellent combination of benefits.
Gaining new customers, and mindshare, also combats
the primary deficiency of the iSeries. That, of course, is it's "legacy" image.
The image that keeps the 400 from coming to mind
when
a server needs to be purchased. Many, both outside and within the
iSeries community, believe that the platform does
not
have good prospects against the Sun/Oracle/MicroSoft/Intel marketing
muscle.
Of course, I'm not telling you anything. These
concerns have been around for a while, and haven't changed much in the last
couple
years. It would appear that this vicious cycle is
intractable. In fact, those of us who've been with the platform 10 to 20 years
have
been following these issues over the decades.
Non-solution
I began roughing out something like a white-paper
yesterday evening. I was honing in on the following conclusions:
1.There isn't sufficient money available to
overcome the iSeries "legacy" image
2.People don't pay the right kind of attention to
ads
3.eServer advertising will be slow to pay
dividends
4.The 400 Division can do the best job marketing
the iSeries
I haven't completely thought through all these
points, but I can send you what I have if you'd like. But even though I believe
most
of the above is correct, I don't believe these ideas
are pointing to the best solution to increasing 400 sales.
Optimal solution
The optimal solution depends on the answer to one
question: Do you have confidence in the adaptability of your sales force? I'm
assuming that Business Partners and Sales Reps still
make calls to close the sales. The reason I ask the question is because:
The quickest, surest, low-risk way to ratchet up 400
sales is to...
have your customers do it.
Why
The iSeries Division's primary assets are the
architecture of the 400, and it's loyal customers. The technology isn't selling
itself.
Effective marketing could and would help this
situation. But as I've glanced at discussions over the last few years, great
attempts
have been made. Outstanding efforts. Over and over
and over. No doubt they've helped sell the 400 immensely. The
re-branding may, in the end, also help.
But the marketing isn't breaking the vicious cycle.
I'm starting to doubt if it would ever be possible, because if marketing could
have turned 400 sales around, I believe it already
would have. Contrary to most in the 400 community, I don't believe it's a case
of lack of effective marketing (though it could be
improved). The problem is not just solvable by marketing alone.
Clearly, superior technology is not going to sell
the
400. The technology is obviously superior to those who see it. Those customers
have already been won over.
The current method of selling the 400 is making
incremental gains. As I said at the start, the goal should be making major
inroads into the competition.
How
OK, if you're still interested in this, the thing is
that you have to forget about the "How". The "How" confronts the issues of what
is
do-able and what is not do-able. Before that, you
have to accept the premise that you're not going to make inroads into your
competition any other way. The current techniques
are not working... Not because they're not good methods. It doesn't even
matter if they are, or aren't. They haven't worked.
They would have worked by now. The market has spoken. Time to listen to
the customer and especially the non-customer. If we
can't connect on this point, then you need not read any further.
How
This is the fun part, to me! This is systems design
(I learned long ago that systems had only a little to do with computers).
I'm not going to hype you. I don't have a master
plan. I know I can work one out. It takes IBM and a group of devoted
customers to implement the plan, so obviously I
can't
speak to whether it will work or not. I don't know you. That may scare you
off. I can assure you that if the things come
together, it will work better than your current plans, and probably cost a
fraction of
what you were planning to pay.
The crown jewel, in my humble opinion, of this plan
is to ask the loyal, devoted 400 customers if they want to DO SOMETHING to
help the 400, to help their own community. The
forums overflow with suggestions how the 400 should be marketed. Go on the
offensive and ask them what they're willing TO DO
about it.
If I may be so bold, I would recommend that you use
Common to issue this challenge:
"How many of you out there are willing to go with a
salesperson, out to a customer, to tell them what you think of your 400???
Let's
see a show of hands."
You can eyeball the room and estimate a 5% response
or a 25% response. If the response is real decent (as I would expect) you
immediately re-issue the challenge: "No, I'm not
talking about how many of you like the 400; I'm talking how many of you will
take
time out of your schedule -- maybe a couple hours a
month out of your schedule -- and make a trip out to a customer."
Now at this point there are a couple paths. If the
response is not good, you go with the bad cop. "People talk about marketing
the 400. Few want to stand up and do something."
If
the response remains strong, the speech is a little trickier. The two issues I
think you'll need to deal with are:
What do we get for our effort?
Why don't you do more to help market the 400?
I can't help but to get more controversial -- but no
pain, no inroads into your competition. (I digress, but I can't recommend
things outside of the context of whether they're
affordable. The best solution is obviously affordable. But I don't know the
numbers.) I believe the best answer to "What do we
get" is free education. What's the profit in 400 education? I cannot imagine
how it could possibly be equal to the amount of
customer good-will you'd get to give it away for free. I'm no philanthropist.
I'm
talking about building sub-brand equity. This is my
opinion regardless of whether you take any of these suggestions or not.
Particularly in light of the fact that if you sell
the 400 in the numbers I would expect, the momentum will implode on itself for
lack of
a competent work-force. I really enjoy putting
systems together that "kill two birds with one stone" because you can help your
cause several ways by trading free education for
customer loyalty.
This is why I referred to this solution as
multi-dimensional. You're selling, you're training, you're building brand
equity.
As for the issue "Why don't you (IBM) do more" -- I
have an excellent solution in mind: you throw me a bone.
I could make suggestions (I have made suggestions)
but I want to hit my deadline, and I don't really know what you want to do.
It's none of my business, but I believe I can
contribute perspective to this issue, if you want.
The
Downside
I'm not as good as I thought, because I thought I'd
have this pretty well figured out by now. The primary downside is opposition
by your sales force (Sales Reps and/or BP). That's
why I asked how adaptable they are. As far as I know, IBM has never done
this. It places extreme demands on your
salespeople.
You can collect info on the customers who volunteer
to do your selling. You can match them to prospects by industry, job duties,
maybe even personality. But you can't control them.
First of all, it wouldn't work. Second of all, you'd just give up the advantage
that they have for you. You start training these
volunteers and the advantage they offer all of a sudden turns into a
disadvantage.
You have to train your salespeople how to work off
of
the volunteer they're matched up with. If the volunteer is technical, the
salesperson shouldn't be. If the volunteer is
quiet,
the salesperson should be the opposite. They need to work as a team, except
that the volunteer can't be working as a team. It
won't be as effective.
I believe your sales force is trainable. If the
pilots turn in good results, you might make BP participation mandatory.
Conclusion
I'm not saying this will be easy to accomplish. I'm
just saying this is the best way to get the message across. This is the way to
get the message to penetrate. This is the way to
turn brand equity and image into profits.
Do I have all the answers? Obviously not, or I
would
have allocated enough time to write about some of my other ideas. By writing
about just the one, I take the risk that you might
have liked some of the other ideas, but you won't want to look at them because
you think this one isn't good enough.
I just have to take that risk, because I wanted to
at
least cover the bases here. And I also think it's important to keep your
commitments.
Thank you, sir, for your time. Please let me know
if
I can be of assistance in the future.
jt (James J. Toran)
-------------------------------------------------------------------------
Best wishes
Rob
________________________________________________________
Erros plc
44 (0) 1844 239 339
http://www.erros.co.uk - The AS/400 Neural Database for the Internet
_________________________________________________________
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