Archive for Business Strategy

Gigabit City Video Released

Business Strategy, Social Media, Technologyon November 1st, 2011Comments Off on Gigabit City Video Released

Adcuda has released their video recap of the Gigabit City brainstorming session sponsored by the Social Media Club of Kansas City. LightThread managing partner, Simon Kuo, is featured in this video.

What you need to know BEFORE creating a Social Media Strategy

Business Strategy, Social Media, Uncategorizedon January 6th, 20103 Comments

We are preparing to meet with a potential new client who happens to be in the franchise business.  They are evaluating overhauling their brand to address some PR challenges they have faced the past year. Before we can help them, we need to learn more about them. In order to brainstorm social media strategy options, we need to establish a baseline of performance, process, and expectations.

We put together the following agenda list for our first meeting together. If you are thinking about creating a social media strategy, you may want to consider answering these questions first. Please keep in mind this list was created for a company who is recruiting franchises so if this is not applicable to you then please replace “franchise” with “customer.”  Also, the list was created for a specific client in mind, depending on certain factors the questions may be altered. If you’re not sure what to do once you have your answers, then please give us a call, we would love to help you!

1.  Messaging

b. What is the brand identity they want created?
c. When people hear your company, what do they want those people to think?
d. Is their primary purpose to recruit new franchises, engage with existing franchises or make the general public aware of the company services?
2. Resource availability
a. What resources are used today for marketing and customer/franchise service?
b. Do they have a resource available to write blog posts, update facebook (I saw that there last update was in November), comment on forums?
c. Do their resources fully understand the online landscape? Are they aware of how to identify, engage and manage top influencers?
d. Do they have the tools and metrics available to monitor and measure progress?
3. Customer engagement
a. How do they address customer/franchise service today? Do they have an 800 number? Email?
b. Are they prepared to appropriately engage with negative sentiment?
c. Do they have a process to respond digitally to requests/comments?
d. What is their expectation regarding timely responses?
4. Marketing
a. What marketing are they doing today?
b. Are they participating in online marketing such as Pay Per Click, Banner Ads, Facebook ads, etc?
c. What marketing support do they provide to Franchises?
d. Do they offer promotions/discounts/contests? If so, how often?
e. Do they sponsor anything?
5. Franchise Recruitment/Support
a. Do they include online marketing as part of the marketing support to Franchises?
b. Do they offer a specific site/resource portal/discussion board for Franchises?
c. How are they targeting/recruiting Franchises?

d. How often do they pro-actively check-in with Franchises? Messaging:

1. Messaging

  • What is the message you are trying to convey?
  • What is the brand identity you want created? What are your brand attributes?
  • When people hear (your company name), what do you want those people to think?
  • Is your primary purpose to recruit new franchises, engage with existing franchises or make the general public aware of the company services?

2.  Resource availability

  • What resources are used today for marketing and customer/franchise service?
  • Do you have a resource(s) available to write blog posts, update facebook (I saw that there last update was in November), comment on forums?
  • Do you resources fully understand the online landscape? Are they aware of how to identify, engage and manage top influencers?
  • Do you have the tools and metrics available to monitor and measure progress?

3. Customer engagement

  • How do you address customer/franchise service today? Do you have an 800 number? Email?
  • Are you prepared to appropriately engage with negative sentiment?
  • Do you have a process to respond digitally to requests/comments?
  • What is your expectation regarding timely responses?

4. Marketing

  • What marketing are you doing today?
  • What is your marketing mix?
  • Are you participating in online marketing such as Pay Per Click, Banner Ads, Facebook ads, etc?
  • What marketing support do you provide to Franchises?
  • Do you offer promotions/discounts/contests? If so, how often?
  • Do you sponsor anything?

5. Franchise/Recruitment Support

  • Do you include online marketing as part of the marketing support to Franchises?
  • Do you offer a specific site/resource portal/discussion board for Franchises?
  • How are you targeting/recruiting Franchises?
  • How often do you pro-actively check-in with Franchises?

We hope this helps give you a jump start to considering how you can adopt social media in to your business model. As always feel free to give us a call if you want to learn more.

Cheers,
Lisa

We Have Client Lift Off!

Applications, Business Strategy, lightthread, Technologyon December 27th, 20093 Comments

The Associated Plastic Surgeons website has truly been the end result of a great team effort between a group of us here in Kansas City. With an SEO expert, a user experience designer/brand identity expert, a seasoned project manager and bizdev expert, a talented front-end web developer, an amazing photographer and a client willing to revamp their entire brand and catapult themselves forward, how could we go wrong? In every area we’ve been able to improve their brand design, site traffic, SEO, tradeshow collateral and ecommerce site. We even introduced them to a little bit of social media creating their first-ever blog that has already generated almost 40 comments!

INFORMATION ARCHITECTURE, CUSTOMIZATION, & STELLAR DESIGN

We designed a user experience and information architecture that led us to developing the “How We Can Help You” section making it easy for visitors to quickly find what they need. We built back-end functionality to automatically highlight the most recent blog posts on the front page to keep content fresh and up-to-date. We placed a “contact us” button in the middle of the page to facilitate user action. The photography on the home page was done just for this site. The design aesthetic was selected to represent the client’s working philosophy to provide their patients with quality, attentive and flawless care.

COPYWRITING & MEDIA GENERATION

We wrote all the copy on the website…all 40-plus pages worth! We created a customized before/after gallery to show the amazing skills of the doctors. We utilized custom photography throughout the site to provide users a view in to what the practice really looks like. We included a “related links” section to support simple navigation and help drive users to other places throughout the site that may be helpful to them.

INTEGRATED MARKETING & PRINT COLLATERAL

In the blog post sample above you can see a postcard we designed to use at the Holiday Mart tradeshow. We also designed a backdrop banner with their logo and the textured background we used for the card. It came out really beautifully! Our developer coded the “share this” functionality specifically for this project, however we are now using this functionality on other client sites as the feedback has been incredibly positive.

E-COMMERCE DEVELOPMENT

As part of the Associated Plastic Surgeon’s brand update and website redesign, we completely refurbished their online store also, where they sell physician-grade cosmetics and skincare products. The store is using the WordPress e-Commerce plugin with some tricked out ways of doing variations, and we’re really pleased with how it’s come out!

Sharing & SEO Improvements
We also added a slew of social sharing capabilities – prior to this redesign the ecommerce store had no variations shown, was difficult to add new products to and offered no sharing or descriptive capabilities. We feel they’re set to do some real online business now, and we have done some things to make this store more competitive in search engines, where it was never found before.

SHARING & SEO IMPROVEMENTS

We also added a slew of social sharing capabilities – prior to this redesign the ecommerce store had no variations shown, was difficult to add new products to and offered no sharing or descriptive capabilities. We feel they’re set to do some real online business now, and we have done some things to make this store more competitive in search engines, where it was never found before.

BRAND IDENTITY

One of our favorite things about the new site is the special logo and identity for the ecommerce store. We did the store under a separate domain name so that we can do Google ads directly to it (bypassing the main website) yet the navigation in the header on both sites seamlessly moves you back and forth. We made this site a rich cream, as opposed to the green APS website, to distinguish them. We found some unique patterns to use inside the logo and for the frames around the product images, and we also like using it as “wallpaper” behind the logo bottles as they appear to sit on a shelf (see the postcard below, used to announce the site launch.) It’s the little things that give this store the stylish appeal we felt it deserved and that buyers wanted to see when shopping for beauty products.

Why did our client like this site? We delivered it per their budget and schedule. In fact, we accelerated the main site’s launch by two weeks to have it ready for the client’s appearance at a 25,000 attendee trade show event. Even better and obviously the most important stat…they are getting new patients as a result of the site…within just days of launch they had two new cosmetic surgery patients! We look forward to future work with APS as they are a fantastic client with a similar philosophy to ours…take good care of your customers and they will come back time and time again.

Web-Based Project Management Tools

Applications, Business Strategy, StartUps, Technologyon September 23rd, 20094 Comments

I had the privilege of speaking the Mid-America Project     Management Institute’s 2009 Professional Development Days conference this week. Both sessions were great with good questions  and active participation. My presentation was titled, “Project  Management Tools in the Digital Age” and highlighted web-based,  simple, and valuable tools that can be used in any type of company size and industry. We use many of these tools in our day-to-day business to manage our projects, teams and our selves.

It is important to remember that a tool should help you facilitate  your work…NOT add more work to your day. You need to  understand your work flow and identify where you need help prior to tool selection.  Tools should help you create, build, and develop projects; lead, direct and advise your  teams/sponsors/clients;  assess, measure, and analyze your  progress, and most important, be  simple to use.

Project Management Tools

Basecamp – We use this tool to manage our virtual workforce teams  and to easily communicate with our clients. We are able to set  milestones, assign to-do tasks according to milestones, upload files,  and communicate through the forums.You can build templates and customize the tool to match your brand. This tool eliminates our  dependency on email and allows 24X7 access to project status.  

Smartsheet – This tool was recommended by a colleague. For you spreadsheet lovers out there this tool may be the one for you. In addition to basic project management capabilities, you can produce summary reports and access the tool from your phone through their mobile application. A very interesting aspect to Smartsheet is their on-demand workforce. If you need resources to help with simple tasks (primarily research oriented tasks) they have a virtual workforce to help you (for an hourly rate of course).

@Task – This is an enterprise level tool and can be integrated with a variety of applications such as Oracle, Peoplesoft and Salesforce.com. This tool has very impressive reporting capabilities that can support the most detailed of managers and the highest level of executives. If you have large and complex programs this tool may be the one for you.

Team Management Tools

Echosign – I have to say this is my favorite tool lately. Echosign allows you to improve your sales contract cycle time from weeks to hours by allowing online signatures that are in compliance with the ESIGN act making the online signature as powerful as a hand-written one. Red-lining is supported as well as multiple signatures/initials throughout the document. The client/contractor you are requesting to sign does not need to have signed-up for the application and can provide their signature in a matter of seconds. We have had 15 contracts signed in the last month and have yet had anyone experience any issues or confusion…in fact a few of our clients are now using this tool for their business.

Freshbooks – Contractors love this tool so we love it too! Freshbooks make invoicing super easy and helps you keep track of what is paid vs. outstanding. Reporting is included and the open API supports integration with Quickbooks and Basecamp. If you are looking to improve your billing cycle time then we suggest you take a look at Freshbooks.

Dropbox – A backup server that finally doesn’t require you to load the document twice. This application synchronizes with your hard drive automatically! You get 2G of storage free and automatic notification when any file is loaded or changed. A tool that helps you with your current workload, doesn’t require extra work and is so easy grandma can use it.

Self Management Tools

Skype – Yes, many of us online types have been using Skype for awhile but for those new to the “geek” scene this tool is a nice surprise. This VoIP application allows unlimited free domestic calling, video calling and instant messaging with other Skype users. You can also quickly upload files and send resource links during conference calls.  The tool integrates with a multitude of  address books and allows calls internationally and to non-Skype users for a premium charge.

Remember the Milk – Built with the “Getting Things Done” philosophy this is a great tool to manage all aspects of your life …personal, school and work. They have a variety of mobile app’s to support an on-the-go lifestyle and include map integration that can track where you are to notify you when you are in the vicinity of getting a to-do done. I personally like the tag cloud capability to help me see where my time is being spent and to highlight where I can get two birds with one stone.

Google – The mother of all tools. In addition to gmail, calendar, and google docs we also use google groups, google voice and google  reader to help simplify our daily responsibilities. Yes, you do sometimes have a glitch here and there but the flexibility, accessibility and simplicity outweigh any of the bumps you may experience from time to time. What makes us the most excited?? Google Wave invitations go out to a lucky 100,000 on September 30th and we can’t wait to see what new opportunities arise post-launch.

We are always looking for new and improved ways to operate our business so if you have a killer tool that we didn’t mention here please leave us a comment and let us know about it!
Cheers,
Lisa

Successful and FREE Press Release Sites

Applications, Business Strategy, StartUps, Technologyon September 8th, 20091 Comment

We are often asked for good business resources from clients, colleagues and friends alike and we like nothing more than to share helpful information! A popular topic as of late is where to find good press release sites. I recently posted this response to a LinkedIn question and thought our visitors here at the LightThread site may be interested as well. Please feel free to leave your favorite press release site in the comments section.

We published a press release in April of this year through a variety of paid and free online PR channels and tracked our results. We experienced the best results from prlog.org. We obtained front page search results within 24 hours of release and 4 months later continue to get front page search results. Our business profile on prlog also continues to show up in search on google page 5. Prlog also made it easy to link on your facebook profile in addition to bookmarking through delicious.

In fairness, we did not try prweb or prleap so do not have comparative results to share. Additional sites that produced front page results upon release were pressreleasepoint.com and prurgent.com. Keep in mind the free sites take a bit of time to set up your profile but once you use them the first time they are much easier to use again in the future.

Cheers,
Lisa

Social Media ROI – More Than Just Revenue

Business Strategy, Social Mediaon June 7th, 20094 Comments

I spent quite a bit of time this evening reading articles and posts highlighting the challenges associated to measuring social media Return on Investment (ROI). Simon also mentioned in his Social Media for Business post the challenges associated to social media metrics, specifically engagement metrics. Measuring dollars is more important than ever so if we want to see companies accelerate their social media adoption we need to show a direct correlation to the bottom line. I speculate this is why the ROI topic is getting big buzz as of late.

Leads, sales, and new revenue get most of the headlines when discussing ROI. However, cost reductions need to be considered as well when figuring/estimating ROI. Social media introduces new possibilities to traditional business practices such as customer care/service, research and development (R&D) and internal communications. These may not be as “sexy” as marketing and sales but anyone of them can be the Achilles heel to even the strongest of companies.

Customer Care/Service: listening & engaging = retention ($$)
Customer care/service is a huge cost area for companies. Social media provides a cheaper and faster way to address customer concerns vs. having to call an 800 number. With the various sentiment monitoring tools available (check out local KC companies Spiral 16 and Social Radar) a company can proactively help customers. Not only does this help decrease call volumes but a company can get good PR and positive brand recognition for reaching out. If a company isn’t quite ready to make an investment let me suggest Google Alerts. You can’t beat the ROI on this handy tool as it’s FREE and super easy to set-up.

You may not be able to get rid of an entire call center but even a 10% reduction in costs can be significant. Don’t forget about customer retention “save” possibilities too…keeping existing revenue is just as important as generating new revenue, especially if your company is being pressured to maintain their customer base.  The cost associated to getting a new customer is high so keep that in mind when considering retention dollar benefits.

Using social media in this manner may also introduce an opportunity to reduce labor costs. Many companies are organized by function so you may have one employee who is a sales person, a second employee that handles the customer service call and a third employee who serves as a retention specialist. Social media may allow a company to employ one resource who can support sales, care and retention all at the same time. Again, this is a much lower cost than the 3 individual resources that they more than likely are paying today in the individual business units.

Research and Development: gain access to the WORLD
Research and Development (R&D) is another cost area that can be supplemented using social media. Market research, product research, strategy considerations, and user groups are just some examples of information that can be gathered through social media. A smart company knows that R&D is important to long term health and growth but during tough economic times R&D becomes vulnerable to cuts. Utilizing social media as a knowledge gathering tool provides a cost effective method to supporting R&D which can save or possibly even grow this very important part of the business.

Internal Communications: knowledge sharing = accelerated growth
One more cost area to consider is internal communications. Big companies typically have an entire organization focused on nothing but employee oriented communications. By leveraging social media and online communities specifically, they can lower their costs in this area. Security and keeping proprietary information safe is often a concern when considering online communities. Doing your homework and developing an effective but simple social media policy can typically address any security concerns.

At the end of the day remember to under promise and over deliver, especially when discussing money matters. Be honest about worst/best case scenarios and forthright that there is still a lot to be learned in this area. If you would like more information about the tools or methods discussed in this post please give us a call or send us an email. Would love your comments on other costs to consider when evaluating social media ROI.

Cheers! Lisa

Social Media for Business

Business Strategy, Social Media, Twitteron May 23rd, 20096 Comments

Though social media is often thought of as entertainment, a way to keep track of friends and family or as a medium used most frequently by those under 25, there are many business applications for it.

Social media includes any web site that supports social interaction like user participation or user-generated content. This includes sites like Facebook, MySpace, YouTube, Flickr, Yelp, Digg, Twitter and many others. Using these sites allows businesses to interact with customers in their own domain. For a customer, this is a more natural, less intimidating way to have a conversation with a company.

The fastest growing demographic on sites like Facebook are those over the age of 35. According to iStrategyLabs, in the six months ending in January 2009 the number of people using Facebook between the ages of 35 and 54 increased 276%.

Here are some of the advantages of using social media for business:

Social media is a good way to promote your business, whether it is large or small, during difficult economic times
• Most social media sites are free to use or very inexpensive. They cost less than traditional marketing or advertising, and unlike television or radio commercials or even print ads, content for social media sites can be created without the assistance of an ad agency. According to Jacob Morgan, co-founder of Mighty Mouth Media, a social media campaign can cost a fraction of what traditional advertising costs.
• It’s fast and accessible – social media is Internet based, can be updated rapidly, and can be reached 24 hours a day, seven days a week.
• Large audiences already exist for YouTube, Facebook, MySpace and Twitter and therefore social media market reach is much wider than local advertising
• Studies have shown that social media is more effective than traditional advertising. According to a Forrester study, Proctor & Gamble found that their http://www.beinggirl.com community for adolescent girls was 4 times more effective than television advertising for their products.
• Social media can help your business to connect with potential customers, for example, a local photographer who put his portfolio on his Facebook page gets most of his business from people looking at his work there.  Since there are large communities on Facebook and MySpace already, they can be very effective channels for promotions as well as a good way to interact with customers outside of a business transaction.

It’s a great way to find useful information and connect with business resources

• There are many examples of businesses using Twitter or other social media to connect to people who have the expertise they lack. Answers can be rapidly obtained and connections made. For example recently I received this message on Twitter:

“Twitter friend @mistersterling needs real estate agent who knows Lee’s Summit area.”

A California-based real estate broker needed to find a Realtor in the Kansas City area who knew Lees Summit. Within a few hours, I had connected him with some friends on Facebook who are in the real estate business. These kinds of interactions happen every day on Twitter.
• On LinkedIn, the online work profile and resume site, people can create groups focused on special topics like entrepreneurship or job hunting, ask questions of these networks and use them to organize events, among other things.

It’s an excellent way to monitor how your business is doing.
• Twitter can be used to check customer sentiment. Well known examples include companies like Comcast which looks for bad customer experiences using Twitter and solves customer problems.
• Social media monitoring tools like Spiral16’s Spark platform or Infegy’s Social Radar, are available to enable a business to monitor customer sentiment through “chatter” on social media sites and blogs.
• Rather than simply reacting (oftentimes much too late to change perception) when the feedback that a customer has had a bad experience finally reaches you through word-of-mouth, a business can proactively manage its reputation interacting directly with customers; this allows you to fix a bad customer experience before it is virally spread everywhere.

Social media is a good way to differentiate your business
• Traditional marketing is about “positioning,” and many people have grown to distrust it because they consider it a company, rather than customer perspective.
• On the other hand, the key to successfully using social media is to be yourself. The more authentic you are the more customers will trust you. The more they trust you the more they will recommend you.  Third party recommendations are a powerful way to attract new customers.
• As companies develop reputations for not being in tune with customers, the ones who use social media reap large rewards:
• President Barack Obama has been credited with a very skillful use of social media during his election campaign. He has over six million fans on Facebook, more than anyone else and was active on Twitter during his campaign.
• Zappos has a very loyal customer base. CEO Tony Hsieh’s amiable style and personal response to customer problems on Twitter has made it one of the most successful dotcom companies with an enviable reputation with customers.
• Whole Foods considers it’s broad use of social media sites like Twitter, Flickr and Facebook a key part of it’s marketing strategy. They have increased the buzz about the company, helped create a positive feedback loop and made customers more aware of its passion for community involvement.

For individuals, especially ones who have been laid off, social media can help increase the size your personal network, connect with companies that are hiring and find new jobs.
• Placement agencies will tell you that most people who are laid-off from jobs find new ones using their personal networks, rather than though blindly sending resumes in response to job postings.
• Business social media sites like LinkedIn and Plaxo enable people to post information about job history, form groups that are focused on specific industries or professions and ask questions to people who might be able to assist with a job search.
• There are many companies, including executive recruiters who routinely look for people with certain skillsets by first messaging their Twitter or LinkedIn networks.

What are some of the barriers to companies using social media effectively?
• Many companies still don’t have a social media strategy today. Conversations about your company will occur whether you have a strategy or not. However, you have the option to either participate in these conversations or to not participate. Not participating means you aren’t managing your reputation during those conversations.
• Social media is different than traditional advertising and marketing so companies have to change their thinking about it to use it effectively. Many companies still believe in tightly controlling their communications, including identifying precisely who can represent the company and what can or cannot be said by a company representative. Social media is most effective when company representatives are allowed to be themselves. Avoid using social media as a channel for traditional “positioning” marketing messages. People see through blatant self-promotion on sites like Facebook and Twitter and don’t like it. Be authentic. Don’t be afraid of interacting with customers at their level.
• Not having defined policies around social media use or prohibiting it entirely.  Rather than barring any use, it is much more effective to define the rules around the use of social media, accept that there needs to be some freedom associated with this method of communicating with customers and enabling employees to work within them.
• Not ensuring that there are clear metrics associated with social media campaigns. Since social media is all about engagement, there are many cases where it is easier to measure success than with a traditional ad. Engagement is directly connected to behavior and is more relevant to a specific outcome than traditional advertising’s more passive activities like watching or reading an ad. Failure to establish success metrics will compromise the effectiveness of social media efforts.

For More Information
• Please e-mail us at: info@lightthread.com or call us at 816-298-9913.

We Don’t Say Goodbye Anymore . . .

Business Strategy, Social Mediaon March 23rd, 20092 Comments

Have you recently connected with anyone from your past?  If you have a facebook account, the answer is probably a big fat resounding “Yes!”  If you want to frame Web 2.0 as a paradigm it can be done thusly:

We don’t say goodbye anymore.

Back in the day, if you wanted to stay in contact with someone, you had to be “pro-active” — call them, schedule something, etc.  If you graduated high school, moved on to a new job, or moved out of state, you also lost touch with those people you shared space with.  Today, the act of staying in contact with someone is “passive.” Just log onto facebook, myspace, or twitter and read what all your friends, old and new, are up to.

Case in point, I recently tweeted the following:

“Incidentally we are going to see @average_jane‘s band this evening at the lake “whatever” pub by Lake LottaWatta. c’mon out. no big whoop.”

Because I use my twitter account to auto-populate my facebook status, two of my best friends from high school instantly knew what I was up to and surprised me by already being there before I arrived.

It was one of the most pleasant surprises of my adult life.

And as the paradigm shifts for individuals, the same thing is happening for business.  Companies are becoming defined more and more by identities, (i.e. people who actually work for the company).  For instance, the twitter world recognizes “Frank” as the man behind comcastcaresjgoldsborough is the man behind Sprint. GaryVee is really the brand, WineLibrary is just where he sells wine.  And for their companies/business, these identities are becoming of premium value.

If one of these people happen to say “Goodbye” to their respective companies, who will you say “Goodbye” to?  The company or the person?

New Business Models in the Same Old Environment

Business Strategyon December 10th, 20081 Comment

To say that the recent downturn in the economy has gotten many to think about how businesses are run would probably be an understatement.  However if there is one principle that seems operative in this environment, it is that the more things change the more they stay the same.  In the past week we have seen stories highlighting Merrill Lynch’s CEO, John Thain,lobbying to receive his $10M bonus.  The reasoning seems clear, he wanted to receive adequate compensation for orchestrating the sale of the 94 year old firm to Bank of America, widely considered to have been the only reason Merrill will continue to exist, at least in some form, for more years. Nonetheless that deal was made after Merrill had already lost about $11 bilion in 2008, though most of that loss has been attributed to Thain’s predecessor in the job, Stanley O’Neal.   Thain had already received a $15M signing bonus upon taking the position.  Thus, argued New York Attorney General Andrew Cuomo, in a letter sent to Merrill’s board of directors, “Clearly, the performance of Merrill’s top executives throughout Merrill’s abysmal year in no way justifies significant bonuses for its top executives, including the CEO.”  But the same old ways of doing business, whether they are outdated or inappropriate approaches to the marketplace still seem to be the most widely practiced.

According to the Corporate Library, the nearly 2000 CEOs of major corporations will still receive about a 7.5% raise overall in 2008.  Although this is far smaller than the double digit gains in previous years, this still seems out of step with the experience of employees of many corporations who are seeing unprecedented numbers of layoffs.  Indeed the average raise for a U.S. households routinely falls below 3%.   Ironically, after the CXO-led financial scandals at Enron, WorldCom and Adelphia, the Sarbanes-Oxley Act was passed in 2002 to, among other things, hold senior executives at companies accountable for the accuracy of financial statements. One of the provisions also highlighted what was thought to be one of the significant causes of these abuses–options compensation and large bonuses that were contingent upon good financial performance that, it was claimed, pressured executives to commit fraud.  Though Sarbanes-Oxley has been widely credited for the elimination or reduction of stock options as a means to provide incentive compensation, the increasing gap in CEO versus line employee pay as highlighted by this continued divergence in salary increase percentages as well as continued evidence that boards of directors have not really changed compensation practices at the highest levels of companies, reinforces again that companies are managed  no differently than they ever were.  And add to that the result of these compensation practices in 2008–scores of major investment and retail banks collapsing, economic recession and the loss of many jobs.  But there is more to this story than simply that outdated compensation practices continue and corporate malfeasance of a sort continues to have a negative impact on the economy.  Outdated practices for running business, what we’ll call “operating models,” also continue.  Peripatetic executives and location-locked line employees continue to be the rule, even as technology should be changing this model. Like outdated compensation packages, outdated approaches to running businesses will not improve our productivity and the work experience that most employees have, leading to unprecedented levels of job dissatisfaction.

Other changes to operating models and incentive compensation could be adopted as common practice.  Businesses no longer have to be relegated to giving total credit for the accomplishments within companies to single individuals like CEOs.  In fact one could argue that the average CEO is getting too much credit for what amounts to creating the proper environment for great products to be created, for example.   How often can one directly attribute the performance of a company to the direct actions of its CEO?  With our abilities to now collect and analyze data it should be more possible than ever to quantify the actual contribution every employee makes to the success of the company and to reward the highest contributors accordingly.

Likewise other aspects of business might also be improved through re-engineering operating models to accommodate a workforce that now actually has the ability to work in virtual environments without the loss of access to data or to corporate information systems, thus leading to reduced commuting times, better work-life balance, more satisfied and fulfilled and therefore more effective employees.  This is a direct result of the accessibility of broadband and mobile technology.  We are no longer in a world where a 1.5 Mbps data connection costs thousands and on-the-go access to email and business applications is costly or unprocurable.  So why haven’t more companies adopted virtual workforces and eliminated capital costs associated with providing most employees with on premise office space and data connectivity?  Because the market has not yet had a competitor that outcompetes other similar businesses though the use of these new technologies.  Most businesses are still doing business the old way-by emphasizing face time, rewarding employees who have more of it under the delusion that that equates to more productivity.

However that doesn’t have to continue to be the case.  LightThread was formed in part because each of us shared a vision that it is possible to succeed in business using vastly different approaches to it.  Indeed it is our goal to be that company that outcompetes all others on that basis.  And these new approaches encompass everything from how a business is operated, leveraging the data aggregation, storage and its manipulation; how products are brought to market; how the equity participation model can be changed to not simply reward only CEOs, to even the idea of what is a company?   Other non-traditional operating models that we will pursue include a more appropriate balancing of family life with work life, so those who choose one over the other aren’t unduly penalized in one way or another.

If any of these topics interest you, please talk to us about them.  We are interested both in the ongoing dialogue to sharpen our thinking, and in your thoughts on what might be the most important things to consider as we begin to build out this non-traditional operating model.