KYC Is Dead

Deepa Bachu of Intuit has a fabulous post on designing awesome products. (no, don’t skip. Click the link, read the article and come back here. I’ll wait)

I think time has come for product managers (and designers) to stop using the term Know Your Customer. Before you reach for your cudgels to beat me up – my intent is not to stop people from knowing their customers but to get a couple of layers deeper in the engagement. Let’s look at some specific problems with this “know your customer”phrase

  1. The phrase has been bastardized. It happened the moment KYC as a TLA emerged from the fertile crescent of product management and got dragged – kicking and screaming – into the muddy waters of banking. In its most sophisticated form in that industry, KYC is a bunch of entity identifiers and descriptive text about the entity. To be updated at intervals and filed away only to be brandished if a regulator came calling
  2. The word “customer” – I have a problem with. It is very common in my industry of enterprise information and I am sure it happens elsewhere too – the customer is not the user. The customer is the one who disintermediates vendors from the user (example, IT departments strike deals with capital market data vendors and often chooses the most cost effective vendor. The market data users are dealing room staff who do not participate in the choosing process). If it is the user that we care about then we must not confuse her with the customer
  3. The word “know” – I have a problem with that too. I know too many people on Facebook – I care for only a fraction of them. I know many more people on LinkedIn than I could really care for. The word “know” has diluted the sense of affinity in relationships. In its pristine form, Know Your Customer is not really “know” – it is living with him, sharing his daily joys, pains and frustrations. A closeness much deeper than just that cursory “know”

So what should the new phrase be? How about User Affinity (UA). Besides addressing some of the problems I mentioned above, this is a smaller acronym and easily segues into what should be a logical next step – User Experience (UX). UX should build out what UA discovers – that is the relationship

I’ll leave this post here just so you can let me know your thoughts about this new paradigm of User Affinity. In the next post of this series I will look at ways to develop affinity and insights. Till then keep the comments coming

Platforms & Openness

There is a rush currently underway in business to become a platform company – provider of an ecosystem. Platforms make intuitively good business sense. The openness of a platform attracts many more participants who either by their presence or their expertise (often both) enhance the base value of the platform. And the platform always gets paid for the facilitation. Consider the Kindle platform of Amazon for example – writers, publishers, readers using the platform pay Amazon for either end of the reading transaction (Kindle is not such an open platform really though writers can self publish on it – perhaps Salesforce is a better example. But you get the drift)

Primary and most significant cornerstone of a platform offering is its openness. That is what attracts participants and builds out the ecosystem at scale. Viewed differently, openness is also a culture. This unique intersection of culture and business model is what makes successful platform companies. If the internal culture of a company is that of opacity, parochialism and fights over turf it is very likely the company will bring the same behavior in the way they run the platform. This pisses off participants (like Facebook a few years back was alienating “partners” by building out on their core platform what the partners were bringing in to the ecosystem. This is – besides plagiarisation – a culture of turf build out, which leads to a culture where no one shares anything for the fear of the idea getting stolen). Once partners on a platform shy away, there is no way the firm can reap benefits of providing the platform at scale. The consequence is mostly a regression into becoming a product company earning one time license fees

Remember the saying – culture eats strategy for lunch? It is true. If you are aspire to becoming a platform company ensure the cultural revolution of being more open, collaborative and tolerant (even for disruptive ideas) starts happening closer home

 

Small and Medium Aspirations

Small and Medium Enterprises (SMEs) represent the vast middle earth in the Indian business ecosystem. And as I write this, a gruelling war is getting fought by a multitude of firms to win this middle earth. Win relationships, win mandates, win contracts, win engagements – all so that when these SMEs become adults, businesses who have won now have prominent seats at the table

In a way we think of SMEs as a different class of businesses altogether. During a requirement analysis phase – for building a product or a service – the trap is in hastening to believe that SMEs have very unique businesses issues and try solving them. Quite the contrary – SMEs most often have the same set of challenges that large established players have. So rather than focusing on the challenges of SMEs, a better approach is to focus on their aspirations. Every small and medium business wants to become like – and be treated like – the big guys. The last thing they want is a condescending salesperson turn up at their doorstep and explain how – almost out of pity – they put together a product or solution for them

If a business is serious about serving SMEs it needs to work to help the SME get rid of that very tag. Help the small business to become as competitive – if not more – than the big business. Help the medium sized business break through the growth ceiling. In short, do just two things – one, align to aspirations and, two, help the Davids beat the Goliath (yes, even if Goliath happens to be your client)

I am so used to

I am so used to

  • checking at 4:30pm if the postman left mail in my letter box

  • going up to the post office to drop off my mail

  • waiting for the operator to call back saying my trunk dial request has gotten through

  • taking a day off every month to do my bank work and pay utility bills

  • queuing up to buy travel tickets

Actually the list is endless when stretched over the sands of time. That is why I get very nervous and worried when I see this phrase in communications used as a means to not try something new

What’s your favorite “I am so used to” phrase? How often do you encounter this phrase? If you ask me I’d say “I am so used to seeing this phrase” (oh, irony!)

Approach the net

The Championships - Wimbledon 2013: Day ThreeLast evening my wife and I watched a bit of Wimbledon after putting our ten month old to bed. It was Roger Federer playing a rank unknown (later identified at ranked 116) Ukrainian Sergei Stakhovsky. It was the first set that went to a tiebreaker. My wife observed, a bit soulfully, that players these days do not approach the net as often as their counterparts a decade earlier did. Tennis on grass was about serve-and-volley. By the time the final would be played, the center court would sport two prominent bald patches on the otherwise brilliant carpet of green. One patch would span horizontally at the baseline and the other at almost perpendicular along the center service line. The second patch represented the path of risk. It was that line players took to approach the net. At the net they would expose the entire court behind them – a total blindspot. And positioned there, the braveheart would expect to intercept the ball much before a bounce or air friction took the sting out of a return. It forced players to accept a reduced reaction time and a possibility that they might have to dive to reach the ball without having recourse to rising again to play the point. But players went up to the net and accepted all these risks – all for the possibility of meeting the challenge head on and catching their adversaries unawares

Last evening we noticed that Stakhovsky was approaching the net far often than Roger Federer was. He was losing most of the net points but that did not deter him to run up. That’s perhaps what a 116 does when facing a number 3. As sleep deprived parents we went to sleep just after Federer pocketed the first set, half assured that we’ll catch a longer viewing of the next match he played. But then we clearly undermined the rewards of risk taking

In life if you have the opportunity to approach the net, won’t you take it?

Why did we not start this company?

Acquisitive companies are where innovations come to die. Innovation is hard work. It means getting out to the streets. It means talking to people (many people), making notes (lots of notes) and then making sense of all those (loads of thinking). It means stopping for a minute and try piercing the fog to understand the future. And most of all it means taking a leap of faith – a chance – that the thing that gets put out there after all this will work. On the other hand acquisitive companies have it easy. Someone’s doled out the money for the boys to go shopping so why on earth should someone bake a cake (messy) when there is money to just buy the pastry (classy)? Jim Collins in “Good to Great” hands out a fair amount of sarcasm for such companies who acquire out of habit. “When the going gets tough, the ‘tough’ goes shopping”, he says obliquely to the M&A boys in these companies

Assuming at some point the sarcasm will sink through the skin, it is likely such companies will wake up and want to kick start their innovation engine (it’s not easy though, but a start is required). There is one simple way for the top management to wake up managers to the reality that the mindless acquisition music has started to stutter and will finally stop. Ask this question. “Why did we not start this company?” 

Think of the power of this question. It hits at the very heart of a moribund system and behooves a diagnostic look inside rather than at the shopping list M&A catalog. This soul searching is what a lot of companies know they’ll not be subjected to and hence try to buy their way through the business. It doesn’t work in the long term. Spending multiples to makeup for structural inefficiencies cannot be a perpetual engine of growth or efficient deployment of capital. Acquisitions create cultural mismatches, raise integration problems and confusion in go-to-market tactics. And all it takes for the cultural needle to shift is the simple question – “why did we not start this company?”

Let this though not be a rhetoric question, a smart quip. The query must be answered (probably made a mandatory section in the investment proposal). The answer can very well be anything ranging from “didn’t have the guts to disrupt our own market” to “we didn’t have the talent to get this going”. Whatever be the reasons – and these reasons will buildup over time – a lot about the company’s bottleneck to innovation can be understood from these reasons. The ones that show up with greater ffrequency are the ones with fires burning below them and needs correction expeditiously. The intent here is not to put a complete stop to acquisitions, which when done judiciously is an important vehicle of adjacent and futuristic growth, but to put a healthy disincentive in how management gets lazy in executing the core

Perhaps the greatest benefit from this exercise is that it is a bit like yoga. It doesn’t promise quick visible results but over a period of time it cleanses up entire systems and returns a company to holistic health

Work From Home

You can’t, if you are working for Yahoo. Reams have already gotten written about Marissa Mayer’s controversial decision so I won’t rehash those. Rather, I’ll make two quick points – where I stand with respect to telecommuting and, in my experience, what with respect to working from home I have seen work (and what doesn’t)

Firstly, a show of hands. I support working from home for certain functions (the standing joke at my office once was a window-cleaner who called in to say he was working from home). But again it is fallacious to cast these “functions” in stone. Even within functions some flexibility has to be built in. For example a Product Manager may very well decide to work from home the day she wants to finish up writing her stories but her presence at office is way much valuable the days engineers start coding her piece (assuming of course the engineers have all come in). So how does one write all these into a policy – is this not way too complicated? Short answer – one does not write a policy on this at all. That is why in most cases it is much simpler to ensure you’ve hired the right kind of folks with maturity to handle such black-gray-dirty white situations than have your exec veep sending out a hundred pager telecommuting policy. Telecommuting employees – especially those who come in only as an exception – must also realize that the workplace is as much a social construct as it is an economic vehicle. Staying at home gets the work done (and sometimes gets the work done much more efficiently than a noisy office with distractions) but one misses out on the working lunches, stairwell conversations and water cooler gossips. These are important in building an informal relationship network that becomes very important in getting things done. I think – and have seen – telecommuting to be career restrictive in most cases. So there is a price to pay for the flexibility that working from home offers

Even in organizations that allow telecommuting, working from home is looked upon derisively (“aha, he is working FOR home today” kind of jibes are common). Some rotten apples, who want to hide under the garb of working from home, bring about this bad name. For teams that have people working from home it is a must that they are all on some messaging system (not e-mail – that is too asynchronous). They must get on the phone much more often than across-the-hallway teams do. For teams producing artifacts – anything – like designs, wireframes, prototypes, presentations should use screen-sharing apps (webex for example) at the slightest possible excuse. And overcommunicate – nothing brings about a sense of togetherness and comfort than seeing conversations flowing back and forth

Now for something very trivial (but from experience I can say these make a lot of difference). Those working from home must get into the zone much like athletes do just before the start of an event. Please do not work in your night clothes (a friend of mine actually used to dress for office even when he just had to climb a flight of stairs to get to his home office). Get a home office setup – a desk, comfortable chair (not borrowed from the kitchen), a phone, headsets, good reliable internet connection and most importantly – a door that you can close to the rest of the house. Do take breaks and, most importantly, end your day like you would if you were at office

Enjoy the short commute back to the living room. And yes, you are now allowed to change into loungewear if you must