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LONDON: An ageing population and an increasingly inter-connected world are two of the main factors companies will have to consider when making their long-term plans, according to the speakers at an event looking at the key developments which will shape societies over the next few decades.

Hosted by Intelligence Squared, the event – covered in more detail here – featured speakers from the James Martin 21st Century School, a “unique collaborative research effort with the goal of formulating new concepts, policies and technologies that will make the future a better place to be”. 

Dr Ian Goldin, the school’s director, said we are now living in what could be a “golden age” of possibility, although while there is much “potential”, the choices that are made every day will shape what life will look like in 2050.

More specifically, he suggested the internet is an example of the inter-connected nature of the modern world, but the movement towards true globalisation could also have negative consequences, such as an increase in the number of pandemics.

Professor Sarah Harper predicted that the advances in medical science could lead to an average life expectancy of over 120 years old in many countries in 40 years time.

Indeed, Japan already has over 40,000 people over 100 years of age, and this development, combined with falling birth rates, will have profound implications for brands, governments, and societies.

From a purely commercial perspective, it was argued the ageing population is badly served by manufacturers at present, and this must change when almost a third of the population is made up of consumers over the age of 50.

The dangers of climate change also mean there will be a need for new green technology to transform the automotive and energy sectors, and this is an area which will receive a heightened emphasis in both the short and long term.

Printed with permission of World Advertising Research Centere. Data sourced from WARC Sept. 24, 2009

By John Riley

As one who had hired consultants and practiced the consulting trade, it does not seem all that complicated to hire a consultant. Yet, many employers seem to struggle with a plethora of techniques to find the right person/firm.

 A commonly used approach is to find a trusted business associate who has hired a consultant and obtain a referral from him, assuming he had a successful experience. While that can offer a degree of confidence, the fact a consultant has been a success with one company does not mean he will be successful at your company.

 I suggest an interview that probes chemistry, culture and credentials in detail will be the most revealing of the personality you are dealing with and at the same time give you the insight necessary to make a sound judgment. Other issues may also be covered, but they are unlikely to provide as much insight into the consultant as the three C’s.

1.  You want to determine if there is chemistry between you and the consultant. That’s important because it helps to build trust which is critical to a good client-consultant relationship. It is a matter of being able to communicate easily and freely with both parties exhibiting a common understanding of the subject being discussed.
2. You want to determine if the consultant will be able to fit into your company culture and values. This isn’t easy and is illustrated by a number of cases where a consultant has failed because of an inability to integrate himself into a company culture and work harmoniously with the employees. However, since a company culture and its values are primarily influenced and shaped by the CEO or President, the consultant may have a good chance to succeed with the culture if he has succeeded with the CEO or President
3. Credentials are important, but more important is the need to know if the consultant has worked on, and solved, any problems similar to the problems you want solved. And you want to know how innovative he has been dealing with those problems. Otherwise, credentials or not, doubts may remain. But, further probing of his experience may overcome any doubts and justify giving him a chance.

 With this emphasis on chemistry, culture and credentials, the interview process can be simplified and the CEO or President can feel more confident of his eventual choice.

Companies would be better served if consultants were not discouraged from making contact and presenting their credentials. Usually, the company already has a consultant or two and doesn’t want to be bothered by others. Nevertheless, the current consultants will not always be on the job. As new problems emerge, the company will probably need to talk to consultants with different skills and experience.

To prepare for that day, management should interview a few consultants to gain an understanding of the talent available in their market even though it is not hiring at that moment. Develop a list of the three or four that have the skills you might one day need. Management, always under time pressure, is reluctant to spend the time, but considering the cost of picking the wrong consultant, it’s a good investment.

When the time comes, you will be well prepared and the process of selection will be much more manageable as well as rewarding.

The French National Assembly has approved some of the toughest anti-internet piracy legislation in the world.

If it becomes law, the so-called Hadopi Bill, named after the new agency it would create, could allow the authorities to freeze the internet connection of illegal downloaders, impose fines of up to $441,000 and even jail repeat offenders for two years.

The new bill, already approved by the Senate, is also known as the ‘Three-Strikes Law’ for its graduated response to web piracy. The first step is to send a suspected illegal downloader a warning email and this is followed up with a letter. If an offender persists in downloading content without the permission of the copyright owner, their internet connection could be cut off for a year.

The bill also requires that wi-fi users block non-authorised users from accessing their connection.

Printed with permission of World Advertising Research Center

By John Riley

With a depressed economy and lagging sales, companies have significantly reduced their purchases.  As a result, sales personnel are dealing with tight fisted buyers intent on preserving their company’s money. However, with a little extra effort and creative thinking, a salesperson can find a way to pry some of that money loose.  That extra effort can be influenced by an incentive program.

 Incentive programs are most commonly associated with sales campaigns, however , they can also be used to increase employee loyalty.  Both programs have been effective. Over the years, these programs have become more pervasive, as  management felt pressures to increase revenues and profits.

 The Incentive Federation conducted a study in 2003 and found North American companies spent approximately $27 billion a year on travel and merchandise programs.  They also found that 78% of respondents remembered travel and merchandise longer  than cash payments.

 Companies have found, as they move to online administration, they can cut costs and improve their ability to exercise good control. The Incentive Federation pegs the cost savings at 60% . When you consider the printing costs of all the literature, direct mail and catalogs or brochures used to implement earlier incentive programs, savings were substantial by switching to the Internet. Other cost factors are award selection and award fulfillment.

Ironically, cost is also the reason many companies have not used incentive programs.

The Federation’s Harold D. Stolovitch, Richard Clark and Steven J. Condly conducted an additional study that revealed more metrics:

When incentive programs are directed toward individuals, performance increases by 27%.

When the program is directed at teams, performance increases by 45%.

Some 92% of respondents who reached their goals credited the incentive plan.

A properly structured incentive plan rewards only those who meet their performance goals. That means you don’t pay for substandard performance. In general, any function that generates metrics can be measured and therefore is a candidate for an incentive plan.  A basic tenet of designing a plan is to have ‘stretch’ goals, i.e. goals that can only be achieved with extra effort. 

 In my own experience, most of the metrics mentioned above were validated while with my former employer. For example, one year, we took 350 of the top building product distributors on a week-long trip to Monaco and London with accommodations at quality resorts . Each year it was a different international locale.  There was not a single distributor on that trip or any other trip who didn’t extend that extra effort to make sure he or she was included.

Travel tends to be more popular than merchandise.

Another incentive program was used in the agricultural market. Again, distributors were the target, but this time the awards were merchandise.  The awards were individual  and pegged to the distributors specific merchandise interests which were determined in advance of the program. In this case, the length of the program was six months and tied to the farm building construction season. The program achieved its objectives  and was continued for four years.

 As a testimonial to the success of incentive programs, the Online Incentive Council , a strategic industry group of the Incentive Marketing Association,  recently reported the online incentive industry is doubling every year. 

Online incentive programs properly structured and administered by the right provider can make a difference in your business.  Revenues can increase.  Costs can go down.

 If the sale department is worried about meeting their quota this year, an incentive program could be the answer.

By John Riley

On October 17^, 1994, the Wall Street Journal ran an article talking about Frito Lay’s use of teams to resolve various plant problems. That story captures the reasons managements everywhere have become instigators of teams to deal with their most vexing issues. The thrust of the article:

 “Since pushing most of its Lubbock (TX) plant’s work, and accountability to teams in 1990, Frito Lay has reduced the number of managers from 38 to 13 while its hourly workforce has grown 20%. Despite less supervision this plant has seen its costs cut dramatically and quality jump. Teams are responsible for everything from potato processing to equipment  maintenance, cost control, and service performance.”

 Using teams to tackle problems and find solutions can be traced back to the late 1920’s when the concept grew out of a research study to determine what happened to workers under various conditions.

Researchers found workers built a sense of group identity, developed social support and cohesion brought about by worker interaction.

 Today, the degree of team sophistication has advanced significantly. And yet, some learned souls have expressed an occasional reaction to working on teams, “I could have done this project by myself in a third of the time.” It can be a valid critique when a team is not properly organized and led. Therein is the opportunity for managers and supervisors to step in and demonstrate their leadership skills.

 It’s very important the individual selected to be the team lead insist on training for that role if training is not offered at the time of his/her appointment. Receiving guidance on such things as conflict resolution, process and proper communications can make a big difference in the team lead’s performance.

 Another key consideration is the decision on whether the issue should be referred to a team. Complex and important issues and decisions lend themselves to team approaches. It is also true when the potential for conflict is great and there is no time pressure.

 Establishing sharply worded and concise objectives for the team is essential. It isn’t easy because various departments of the company will probably be represented on the team and each representative may have a different set of interests.

 Once meetings are underway, the Team lead’s most important responsibility it to generate and maintain good relations among members. People and problems need to be separated and options explored by the whole team. When conflict arises, persuasion is needed to restore harmony and direction.

 Leading a team successfully requires the kind of skills management is looking for in their future leaders, skills such as organization and planning, communication, problem solving and managing people.  That’s why the wise manager or supervisor who has an opportunity to lead a team should welcome the challenge and grasp it firmly.

By John Riley

All too often small companies hesitate to quote on large contracts because they don’t feel they have the capabilities or resources to fulfill the requirements.  That may be true, however partnerships can be the solution to grow when all other avenues offer limited opportunities.

 Management attitudes toward competitors in the past have created barriers to keep competitors at a distance .  Not any more. Today, the word is connectivity and building a more formidable means to sustain competitive advantage.  This process broadens the executive’s view so she/he can scan the horizon for larger business opportunities rather than focusing exclusively on the smaller niche markets.

 Transitioning to a business partnership starts when a large purchase requirement  appears  and you want to pursue it.  That’s when the capabilities and resources needed to  handle the order are defined. Once the requirements your company can provide are noted, the balance of capabilities and resources are what a partner will need to provide.

 For example, one partner may have special skills in software and hardware selection and compatibility. The other partner may have expertise in managing computer networks worldwide.  The combination of skills significantly elevates the partnership’s  qualifications beyond either company’s individual capabilities.

 Another example could be a public relations firm and an advertising agency.  

 Values are very important to a successful partnership. There needs to be an exchange of views to make sure there are no conflicts that might disrupt a good working relationship. Occasionally, this is an area overlooked by business owners and executives in forming partnerships, joint ventures and mergers and when that happens, problems occur frequently.

 Another area where understanding and agreement is necessary is defining  the purpose of the partnership.  Usually partnerships, like joint ventures and mergers, are undertaken for more than one reason. To avoid working  at cross purposes, the potential partners need to discuss what they want to gain from the cooperation.  If there isn’t agreement, then its best to start looking for another partner.

 The confidentiality of information shared in the partnership needs to be protected. A confidentiality agreement should be consummated between the two companies early in the discussions.

 Sometimes one or both partners will take for granted who will do what if they get the contract they are pursuing. That’s a bad idea. It’s important to determine the responsibilities of each partner at outset of discussions. 

 Properly structured, partnerships can be very effective, save time and increase productivity.  In effect,  partnering gives you competitive advantage by accessing your partners skills and resources.  Don’t overlook this avenue to growth.

Some 70% of US marketers will shift part of their budget from traditional to digital media in 2009, and a majority are also turning to promotions rather than building brands, the ANA and Marketing Management Analytics have found.

Based on a survey of 95 senior marketers, which was conducted by mktg, the ANA reported that 75% of participants will reduce their overall expenditure this year.

Furthermore, 67% of the panel had either seen their annual sales targets remain constant or increase when compared with 2008, despite the fact they now had fewer resources at their disposal.

A third of the sample predicted spending levels would be unchanged in 2010, while 36% forecast an increase, including 12% expecting an uptick of over 10%, and 14% said their outlay would fall by a similar degree.

One area witnessing an increased amount of activity has been the formation of multi-disciplinary teams, with 32% of the sample working regularly with members of their finance and research-focused colleagues, up 10% year-on-year.

Similarly, 38% of contributors have adopted the same metrics as their finance departments – up 11% on an annual basis – while 20% argued they now made strategy with their counterparts in this area.

Marketers are also using more detailed analytical tools, with 17% employing “what if” scenarios to estimate the impact on sales of changing their adspend, up from 8% last year.

A further 43% are building “customer lifetime models”, an improvement of 16%, while 19% were developing predictive sales models, almost double the total from 2008.

More broadly, 53% of industry specialists were diverting resources away from brand building and towards promotions, while 38% are turning to “lower-cost media”, such as shorter TV spots.

A total of 46% of respondents were “satisfied” with the return on investment, including sales, derived from marketing, while 34% were happy with their agency’s measurement processes.

However, just 28% felt they could respond flexibly where certain channels were not delivering the desired ROI, and only 20% were confident in their ability to predict how marketing will impact sales.

Finally, 43% of senior managers taking part in the study regarded marketing as being an investment in brand equity, compared with 39% who described it simply as an “expense”.

Printed with Permission from World Advertising Research Center

Data sourced from ANA; additional content by WARC staff, 15 September 2009

By  John Riley

As the U.S. labor force grows between 2006 and 2016, 93% of that growth (11.9 million) will be from workers ages 55 and older says one government estimate.  This is attributed to many gray and aging Americans who are healthy and active. They want to be productive and feel useful well into their later years.

 Younger Americans,  between the ages of 16 and 24, are a declining share of the labor force with 57%  today versus 66% in 2000.  However, a rising share of this age group are in school.

 There are  two factors that help explain these changes.  First, is a belief in the need for a college education  to be successful.  Nearly 75% of the public feels this way now versus 49% in 1978.

 Second, is the impact of the recession on young people. Many are believed to have dropped out of the job market.

 This, and other findings about America’s changing  work force, come from a new national survey, Pew Research Center’s Social and Demographic Trends project.

 Other results:

—  the number of women who have a job or are seeking one is no longer growing, but holding at 59%.

 That’s a change after five decades of growth.   Men rank about 13% higher.

—  most working mothers and only 19% of men prefer part time jobs.

 Pew based its findings on data obtained from the Census Bureau  and the Bureau of Labor Statistics.

 Microsoft, the IT giant, is seeing the online stranglehold previously enjoyed by its Internet Explorer platform in China gradually erode under pressure from a number of domestic rivals, the latest figures suggest.

According to estimates from iResearch, Microsoft once held a 96% share of the web browser market in the world’s most populous nation, but this has now declined to 57.8%, and the exact total could be lower still.

Ding Li, an analyst at iResearch, said “according to my research, nearly 96% of China’s internet users have used an IE browser at some time in their lives, but only 50% of them keep to it regularly now.”

In particular, Microsoft’s share is being squeezed by three local alternatives with a combined market share of 31.1%, and which are “adopting advanced techniques and updating their products continuously,” Ding said.

Tencent has developed its own web browser, TT, and hopes to attract some of the 300 million people who are members of QQ, its instant messaging service, to switch to its new system.

“Its users are Tencent’s most prominent advantages. If TT can combine QQ software with its Tencent TT browser, it may become a browser with the biggest amount of users in the future,” Ding said.

Qihoo360′s360 Secured Browser, which is known particularly for protecting the privacy and data of its users, has increased its market share by 50% over each of the last three quarters, to 8.4% in all.

Qi Xiangdong, president of Qihoo360, argued “safety has become a top priority for people when choosing a browser. The 360 Secured Browser uses its ‘isolation mode’ to block any Trojan horse virus.”

Maxthon is another competitor to Microsoft, and offers a range of user-friendly features, such as tools allowing consumers to identify and access their favourite web portals from any computer.

Chen Jieming, ceo of Maxthon, said “most of our users were born between the 1970s and the 1990s and we are trying to attract those born before the 1960s to use our Maxthon browser.”

Chen said Google’s web browser, Chrome, has also struggled to make in-roads in the rapidly-developing online marketplace in China, for a mixture of technological and cultural reasons.

“Even though Google’s browser uses many of the most advanced technologies from all over the world, it still hasn’t gained popularity in China. Some Google Chrome functions aren’t even compatible with some Chinese websites,” he said.

Other multinational operators such as Firefox and Opera are also struggling to establish a substantial presence in the country as yet, according to Ding.
Printed with permisson of the World Advertising Research Center
Data sourced from Alibaba; additional content by WARC staff, 09 September 2009