There’s always a rush these days to get plans into action.  Action is what we value, just as we’re always looking for someone who “can hit the ground running”.  But what if they’re running in the wrong direction?  And how do you know in which direction to run?

The answer to that mistakenly comes in businesses doing what they’ve always been doing and whenever possible just running faster.  In the accelerated competitive environment of New York City, we’ve become accustomed to stores, restaurants, professional services and even hospitals suddenly disappearing.  These businesses failed even though they worked harder and ran faster than anyone around them.  Why did they fail?

Most likely, they never asked their customers whether the direction they were going, the products and services they were offering or the benefits they perceived internally met customer needs.  It’s the rare manager or entrepreneur who can intuit what the market is looking for.  Otherwise, there would be a lot more people like Steve Jobs around.  Businesses have to get feedback from their customers and understand how to match their offerings with what customers are seeking.

Not surprisingly, customers often see product plusses and minuses in completely different terms than the companies selling them.  The best advertising campaign in the world won’t convince customers that they should be seeking something different.  We’re just not in that linear world of the 1950s and 60s when we could be told what detergents make our clothing cleaner and then march in lockstep to the store to buy them.

Of course, businesses don’t always listen to their customers because internal beliefs are so strong as to refuse to change their strategy to meet customer needs.  Here are three examples to consider:

1. Several years ago, we were asked by the Chilean Pisco industry to provide a strategy that would open up the U.S. market for them.  If you don’t know Pisco, it’s an eau de vie, somewhat like a refined grappa, that’s made in Chile and Peru.  Our research found that bartenders believed it made most vodka-based cocktails more interesting and one of our key strategic recommendations (futureshiftpisco.com) was to unleash the creativity of bartenders with a series of tactical programs that would challenge them to develop great Pisco-based cocktails that their customers would love. But Chile is a country where perfection in planning is highly valued and established.  That works when building bridges, tunnels and skyscrapers, of which you’ll see many in Santiago these days but not when variable decisions are involved as with bartenders and their customers.  The Chilean Pisco industry decided to design several “perfect cocktails” that they could then promote in the U.S.  The result?  Peruvian producers who gained a better understanding of the U.S. bartender now dominate the market.  There’s still time for Chile to adapt as Pisco still is not well known in the U.S.   They simply have to acknowledge that their customers have more power than they do.  Easy, right? 
2. While we’re on Chile, let’s move to technology.  This time the Chilean technology industry told us they wanted to sell their growing tech industry to U.S. companies.  Chile had already achieved tremendous success in establishing itself as a successful place to locate an offshore tech center.  Now, they wanted to have a presence inside the U.S. to provide SaaS and enterprise integration products. Again, we spoke to prospective customers for these talented Chilean companies and were told that if they could establish partnerships with Chilean companies in Latin America, a piece of their U.S. business would likely follow.  (FutureshiftChileIT.com)In other words, help us in your territory and then we’ll reward you in ours.  U.S. companies wanted to understand the Chilean miracle and how it had become an export powerhouse. But just as with Pisco, the forces that worked internally in Chile were too strong to persuade them to adopt a market-oriented strategy in the U.S.  Six Chilean IT companies came to the U.S. trying to sell their services based on low prices.  But why go to a company thousands of miles just for low prices when that can be found down the road?  Today, there is only a small amount of programming work going to Chilean companies, as talented as they are. 
3. Most recently, we conducted a research and strategy project for the Maine lobster industry.  Following 200+ interviews, there were a number of findings in that report that showed how Maine lobster possesses attributes to restaurant and hotel chefs that were not being considered within the industry.  There is ample opportunity for the Maine industry to differentiate its brand from all competitors.  However, lobstering is a traditional industry and change does not come easily.  Like the two Chilean examples, internal beliefs in Maine are strong.  Most lobstermen are focused on their first transaction with a dealer when they bring their catch to the dock.  The needs of restaurant and hotel chefs can be perceived as a distant concept and there is little patience for the time it takes to raise the foodservice market’s demand.  The local dealer and summer tourist who loves to sit at the water’s edge, even though they both pay rock bottom price, is more concrete.  It’s been that way for more than a hundred years so change, despite market feedback, isn’t easy.  There’s cause to remain optimistic but it remains to be seen whether Maine’s lobster industry adapts.

In each of the above cases, the right strategy began with listening to customers.  That helped set a direction for the industry to go.  But at that point, industry members often put up obstacles to change.  After all, it’s far more difficult to do something new than the things you’ve been doing for dozens of years, even though they may not be working.

FutureShift develops brands and rebranding programs by understanding how customer decisions can increase engagement and loyalty.

Tags: Action, Advertising, bartenders, Change, chefs, Chile, cocktails, Corporate Myopia, Creativity, Customers, Direction, futureshift, Information Technology, IT, Latin America, Leadership, lobstermen, Maine, Maine Lobster, Marketing, Mistakes, New York, Outcomes, Peru, Pisco, Positioning, SaaS, Situation Analysis, Steve Jobs, Strategy, Tactics, technology, Trade Associations, U.S. Marketplace, Winning

No, Michael Porter is not dead.  Only the consulting firm that he co-founded in 1983 is gone.  Today, the global accounting giant, Deloitte, announced that it had completed its acquisition of Monitor, which had filed for bankruptcy this past November.  As reported in The Economist last November 14th, the once proud firm, “was able to compete with the likes of much bigger McKinsey, the Boston Consulting Group and Bain.”

No mention was made in the announcement of what role Porter might play in the newly formed division of Deloitte but he remains a highly regarded professor at the Harvard Business School.

Businesses come and go all the time and acquisitions are a daily occurrence.  What is of note here is that Monitor was founded by a man acclaimed as one of the great business strategists of the past century, and more importantly by his principles, best known as “Porter’s Five Forces”.  Under the guidance of the Five Forces framework and Porter’s fame, Monitor’s legions of consultants found millions of dollars of billable work among foreign governments, multi-national corporations and commodity boards.  That work began to dwindle in 2008 when Monitor had to seek a series of loans from its partners and venture capital firms in order to stay afloat.

In the November issue of Forbes, contributor and business author, Steve Denning, uses his rapier-like writing skills to tear apart both Monitor and the philosophical approach behind it.  In other words, he does some dancing on Porter’s grave.  While the article is now two months old, it makes for compelling reading if you were a believer or doubter of Porter’s framework.  Put me in the latter camp.

I first read Porter’s seminal article in the Harvard Business Review, “How Competitive Forces Shape Strategy” in 1979. I was one year out of business school and a loan officer in a commercial bank.  My mantra was a phrase coined by another business guru, Peter Drucker, and known as “Managing by walking around.”  The idea is that by engaging with people both inside and outside an organization, managers can best understand how their companies, products and management styles are perceived, how they perform and what to do about them.  That’s a simple concept that one could explain in an elevator between the first and second floors.

It served me well then and has since as I’ve made the practice of engaging with both internal and external audiences to find the intersection between internal capabilities and external needs as the place to find the sweet spot for successful strategy.

Porter’s Five Forces, on the other hand, require a much longer elevator ride. The idea is that by managing a framework of five market forces, a company or industry could find sustainable competitive advantage.  “The state of competition in an industry depends on five basic forces…The collective strength of these forces determines the ultimate profit potential of an industry.”

I can’t say I fully understood it in 1979 and I can pretty much say the same today.  I looked at the model then as I do now and ask, “Why is the competition at the center?  Why not the customer?” Drucker taught that the only valid purpose of a business is to create a customer.  Yet, here was Porter, saying that it’s all about dominating the competition.

I had a memorable meeting at Monitor’s Cambridge headquarters in the early nineties.  At the time, I was doing some consulting for the government of Chile on export promotion, inbound investment and tourism development.  Monitor had built up a practice in consulting in these areas and proposed a partnership.  I felt this might add some prestige to the project.  At our meeting, one of their senior consultants explained how they would apply the discipline of the Five Forces to the project.  He drew lots of squares and circles on the board labeling them various types of competitive clusters and argued that it was winning against competing countries, not customer perceptions that would win the day for Chile.

I left there confused and unconvinced that the focus should be on “competitive clusters” rather than matching what Chile offered with customer needs.  If you spend your time focusing on rivalries, you’re losing time creating more innovation to meet growing market demands and before you know it, your competition will be your problem.  As the famous baseball pitcher, Satchel Paige, said,  “Don’t look back.  Something might be gaining on you.”

As Steve Denning notes about Monitor, “Its consultants were not people with deep experience in understanding what customers might want or what is involved in actually making things or delivering services in particular industries or how to innovate and create new value.”

Today, factors such as globalization, the Internet, and the growth of social media have heightened the importance of building strategy around customers.  Now that the world is flat, customers decide who wins in every industry and political arena.  As Denning ends his article, “Monitor was crushed by the single dominant force in today’s marketplace:  the customer.”

It’s hard to argue against the man who is one of the most cited scholars in economics and business and whose ideas are widely used by business and government leaders around the world.  But we are in a different time where the key is satisfying customer needs for innovation, whether they be in features, quality, service, or value.  Companies like Apple, Amazon, Fresh Direct, and Kayak are just a few of the examples of how our flattened world has given power to customers.

Our consulting approach is to put customers at the center and to understand their frustrations.  After all, a frustration is simply an unmet need.  Find the innovation to serve that need, erase the frustration and you’ll find a successful business — that’s a short speech in any elevator.

Tags: Amazon, Apple, Assumptions, Change, Chile, competitive clusters, Corporate Myopia, Customers, Deloitte, elevator speech, Five Forces, Forbes, Fresh Direct, futureshift, Governments, Harvard Business School, Kayak, Managing by walking around, Michael Porter, Monitor, Monitor Group, Outcomes, Peter Drucker, Porter's Five Forces, Positioning, Satchel Paige, Situation Analysis, Steve Denning, Strategy, Trade Associations, U.S. Marketplace, Winning

It has been several days now that we watched the Vice Presidential debate and have been subjected to a discussion that’s more about whose demeanor and facial expressions have been better than about their policies.

Depending on from which side you see things, President Obama has either brought the economy back to a place where it can now recover or he’s brought us to a Leninist-Marxist precipice.  Governor Romney is either the biggest liar that has ever run for president or he is just the man we need to help America get back to its revolutionary roots.  It’s that extreme and it’s that myopic.  We’re losing sight of the big picture.

Yesterday, I attended the annual shareholders’ conference for The Baron Funds, a group of mutual funds led by Ron Baron who believes that it’s the quality of people who make great companies and that investing in them is a long-term bet on America.  The event is held each year at New York’s magnificent Lincoln Center. 4,000 shareholders attended.

During the morning, you get to listen to presentations from CEO’s of companies the funds have invested in.  Then at lunch, various entertainers perform in one of the many auditoriums at the Center.  Yesterday, the choices were British rock singer Joss Stone, Broadway star Kristin Chenowith, or jazz stylist Harry Connick Jr.  After returning from lunch, the senior analysts from each of the Baron Funds engages in a panel discussion about the past year’s performance and how they pick stocks.  When this ends, there’s a musical performance from a big name headliner.  In the past, it has been people like Rod Stewart, Bon Jovi, Elton John and others who you’d pay a lot of money to see elsewhere.  Yesterday, the headliner was Celine Dion – more on Celine later.

I don’t know if Ron Baron chose the CEO’s who made their morning presentations to make a point about the country’s economic stewardship.  I want to believe he did.  Here’s a brief encapsulation:

• David Rubenstein, Co-Founder & Co-CEO of The Carlyle Group showed a different set of values for private equity firms than we’ve seen during the past year from Governor Romney’s turn at Bain.  From its start in 1987, Carlyle now manages $160 billion in investments with the goal of supporting good companies that create jobs and prosper for their shareholders AND employees.  For all his success, Rubenstein exhibited an amazing self-deprecating sense of humor and stressed the importance of giving back to America.  He has put his money where his mouth is by joining Warren Buffet in giving his fortune away.  What came across more than anything is that good values build great companies.  By the way, he said he has no problem with the regulations imposed by Dodd-Frank, which some politicians want to remove.

• Steven Spinner, CEO of United Natural Foods was a little more meat and potatoes in his presentation…well actually, more tofu and bulghur… but he expressed a need to be more conscious about our environment and both the chemicals we put into our environment and our bodies.  The company is now the largest distributor in the U.S. and Canada of natural and organic foods and has become a $4.5 billion company with 65,000 sku’s and 23,000 customers.  Healthy foods raise our awareness of our environment and build successful businesses – quite a contrast to the right wing preaching that the government (and in particular, Michelle Obama) is trying to force feed us healthy foods we don’t like.

• Robert Katz, CEO of Vail Resorts showed how a sizable business ($1 billion +) dependent on nature can prosper when it focuses both on good environmental stewardship and helping people enjoy all the recreational possibilities that enables.  What’s interesting is that they don’t own the land their resorts sit on.  They lease it from the National Forest Service, and have to work with the Service to show they are deserving of both permits and leases – a great example of how government helps improve our lives, supports business and is worth the investment we all make in it.

• Frank Coyne, CEO of Verisk Analytics is all about Big Data.  This company dominates the insurance risk assessment business.  I have no idea of his political leanings (or most of the others for that matter) but he’s a former Marine who grew up in a lower middle class family from Scranton, PA.  There was not a trace of ego in his presentation.  He is clearly an American success story who rose from the middle – no trickle down there.

• Kevin Plank, Founder and CEO of Under Armour, a $2 billion company that began in his basement in 1996, told an amazing story of how his experience as a college football player took him on a search to find better performance athletic clothing.  He displayed optimism, competitiveness and personal charm in telling his success story.  There was not a hint of dismay in his approach to the future.

• Rich Barton, Co-Founder & Executive Chairman of Zillow, Inc. was the moderator of the analysts’ presentation so he wasn’t really focused on his or his company’s story.  However, he founded both online travel giant, Expedia, and Zillow, an online real estate search site.  He’s another American success story who displayed extraordinary optimism.

The last presentation of the day came from Ron Baron, CEO of Baron Capital Group.  Baron founded the funds in 1982.  Today his enormous success has made him a billionaire.  I’ve never met the man but in every conference I’ve attended, he always stresses his middle-class roots in New Jersey, his optimism about American business and his belief in America.  He doesn’t hesitate to mix patriotism into business.  As in past years, Broadway star Kelly O’Hara came out to sing America The Beautiful as everyone sang along.  This year, there was an additional treat of Kristin Chenowith singing the national anthem.  She raised the roof and 4,000 hearts with it.  (That girl has pipes!)

Baron gave his outlook on the economy, the stock market and reminded us why a long-term investment philosophy in good people who build great companies pays off .  He praised Federal Reserve Bank Chairman, Ben Bernanke for his stewardship of the economy to a smattering of applause.  He showed how the stock market has climbed 60% since the days of doom and gloom four years ago to wild cheers.

Then, came the part that left me stunned.  He noted that we’re soon to have an election between President Barack Obama — maybe 20% of the audience applauded — and Mitt Romney to loud, enthusiastic applause that drowned out anything that had preceded it.  It left me wondering whether anybody had been paying attention all day.  The contrast to private equity investing with the Romney approach from David Rubenstein ‘s Carlyle Group couldn’t have been clearer.  Protection of our food sources and environment have helped businesses succeed, not fail due to over-bearing government regulation.  The economy never fell off the cliff.  Businesses and the stock market prospered and now they’re cheering for an uncertain change that promises to strip away a lot of the government support and regulation that has contributed to both success and fairness?  I don’t get it.

I grew up in a family that was firmly Democratic, although I believe I am more fiscally conservative than my parents.  While I live in New York, I continue to vote in Maine where I still own property.  There, like many Mainers, I’ve settled into a mode of independence, voting for moderate Republicans like Bill Cohen and Olympia Snowe, independents like Angus King and Democrats like George Mitchell.  The contrasts to me this year couldn’t be clearer.  While I’ve lost some of my love for President Obama, I think he provides a healthier direction for America.  We have serious problems to fix but I don’t believe those will come from cutting everything except defense and frankly, I have a problem with disingenuousness.  Neither party can claim sainthood in this regard but I saw Romney claim himself as “severely conservative”, heard his campaign manager say they could just take out the “etch a sketch” and remodel him once the Republican nomination was secure and now he’s transformed himself into a moderate.  It reminds me of that famous Lincoln quote:  “You can fool some of the people all of the time, and all of the people some of the time but you can’t fool all of the people all of the time.”

In the end, just like Ron Baron says and practices, it’s about people and their values.  Not only do good people build great companies but they also build great countries.  I left the conference a little dismayed at the shareholders’ reaction to the election but still optimistic about the long-term.  To that, I can thank Ron Baron for this annual event.

This brings me to Celine Dion.  I’m not a fan and never have been.  She’s too kitschy for me.  Yes, she’s talented and a professional song stylist who’s benefited from great writers but in one song, Kristin Chenowith blew her away.   After all the great rock stars I’ve seen at this event, I was surprised at her appearance.  “Las Vegas East”, Ron Baron called it.  It certainly was.  Her big band, violins, lots of costume changes and a self-aggrandizing video were all on display.  Like so many other successes — only in America.

I thought of staying for a few songs and then leaving but then I thought of my daughter.  She’s a fledgling comedy writer in LA and she loves Celine.  She’s dreamed of going to Las Vegas to see her and has even asked me to foot the bill for the $250 ticket.  You can imagine how far that went.  But as Celine came on, I texted her knowing that she would be excited.  It was only the texting banter between us that kept me there for the duration.

Here it is:

So the afternoon entertainment is Celine.

SHUT UP!

Here she is:

You are breaking my heart.

HOW IS IT THAT YOU GET TO SEE CELINE DION PERFORM AND I NEVER HAVE?

Tell me everything!  WHAT IS SHE WEARING?  How many costome changes?  How many times is she fake crying?  AHHHHH

Is she amazing????  OF COURSE SHE IS!!!!

I guess because I own $30K of Baron Funds.  I wish you were here.  She’s too sappy for me.  I don’t know how long I can last.

OMG omggggggg!!!  Just revel in it.

Oh, here come all the big hits!  “I’m your lady” oooh la la

OMGgggg!!!!

Imagine her an alien from a special planet where the wind is always billowing her hair and dresses!

A lot of eyebrow action and the motions.  WAIT!  We have violins!  It’s a costume change!

AHHHHHHHH.  WHAT IS THE NEW COSTUME?

This is so unfair.

We’re waiting with bated breath.  Maybe she went out to pee.

Slinky, black and silver.

It’s cabaret time.

She’s magnificent!

I’ll record Titanic if she goes there.

OH SHE WILL AND YOU  BETTER.

She tucks her 3 little ones into bed and there’s video to prove it.

Stop it.

I think I’m going to throw up.

Me too.

It’s “Beauty & The Beast” time.

Oh, I love that one.  This is so unfair, it hurts.

I feel your pain.

It’s another costume change.

What will it be?  There’s James Bond music.

Ughhhhhhhhh

No, she just went to pee.  She’s singing “Goldfinger.”

A medley of 007 songs.  She’s got her fist in the air.  The audience is in a state of rapture.

Now, she’s patting her hip and swaying.  This Québécois lady knows how to have a good time.

She sure does.

This all sounds glorious!

A little piece of heaven.

I’ve run out of responses.

I’m just really jealous.

It’s “All by myself” now.  I know how she feels.  Carla left to go to a meeting.  So sad.

Double fist pounding on her chest.  Serious stuff.

Now, she’s singing “Spinning Wheel”.  Am I back in college?

Costume change!

This is amazing.  Never forget how amazing she is.

Elvis is in the building!

Here we go:  I’m sinking.  There’s an iceberg and the ship is going down.  I’m recording this.

It’s over.  I’m exhausted.

Holy crap!  Me too.

The Baron Funds Annual Conference is one of my favorite days of the year.  I am reminded of why I am in business and what I tell my clients through my consulting business.  I’m entertained in this incredible city and my belief in America is always restored.  This year, it also provided some fun with my daughter.  Is there anything better?

Tags: 007, America the beautiful, American success stories, Americans, Assumptions, Baron Funds, Beauty & The Beast, Ben Bernanke, Big Data, Bill Cohen, Bon Jovi, Broadway, Celine, Celine Dion, CEO, Change, Chile, Corporate Myopia, Crazy people, Customers, David Rubenstein, Democrats, Democrats and business, Dodd-Frank, Dreams, Elton John, Elvis, Etch a Sketch, Events, Expedia, Federal Reserve, Frank Coyne, futureshift, George Mitchell, Goldfinger, Governments, Harry Connick Jr., James Bond, Joss Stone, Kelly O'Hara, Kevin Plank, Kitsch, Kristin Chenowith, Las Vegas, Las Vegas East, Leadership, Lincoln, Lincoln Center, Maine, Mainers, Marine, Marketing, Michelle Obama, Mistakes, Mitt Romney, National anthem, National Forest Service, Olympia Snowe, Organic foods, Outcomes, PA, Paul Ryan, President Obama, Quebecois, Regulation, Republicans, Republicans and business, Rich Barton, Robert Katz, Rod Stewart, Ron Baron, Scranton, Shareholders, Situation Analysis, Spinning Wheel, Steven Spinner, Stock Market, The Carlyle Group, Titanic, U.S. Marketplace, Under Armour, United Natural Foods, Vail, Vail Resorts, Verisk Analytics, Vice Presidential Debate, Winning, Zillow

This is the sixth in a series on Mistakes Countries Make and How They Can Get It Right

We just began work for a client in our 18^th country.  While that’s only 7% of all the countries in the world, they add up to over 30% of the top 50 countries in GDP.  That’s not a bad sample from which to draw some conclusions about foreign businesses that are marketing products in the U.S.  We’ve noticed a number of mistakes and major assumptions that seem to be common among all of the countries that our clients have come from.

One I’ve increasingly noticed is the assumption that Americans are waiting for foreign products with bated breath.

It’s always struck me as unusual that foreign marketers often think that just their presence in this country will create demand.  Yet, I’ve been stymied for an explanation as to why this is the case.  I think I’ve finally hit on it.

For decades, people in foreign countries have looked up at the U.S. as the bastion of top brands, particularly among consumers.  American brands have become a badge for people to show that they travel and have sophisticated and Western tastes.  This says nothing about whether they like the U.S. or about their sentiments on American government policies or even whether, more recently, the glow of American brands is wearing off.  It’s history.

From the time of the Cold War when a pair of Levis could buy you a hotel and meal in Russia to today when Nike shoes can be found on the feet of people in countries around the world, Coca-Cola at their tables and McDonalds around every corner, American brands have had a pretty good track record of coming into a foreign country and quickly generating sales.  True, there have been monumental mistakes like GM trying to sell the Chevy Nova in Latin America, but for the most part, U.S. brands have meant sales.

So, it might stand to reason to someone from outside the U.S. to ask if they buy our brands just because we’re there, won’t we buy their’s just because they’re here?  Foreign marketers often miss two key facts about the U.S. that can cause their sales efforts to fail:

1.  We’re internally focused.

The U.S. is a big country, no secret there (take a look at the maps in an earlier post, “Mistake #5:  Size Matters”) The point is that most Americans don’t think about the rest of the world.  With the exception of only two countries, Canada and Mexico, we don’t have countries next to us, just more Americans.  Many Americans don’t read the newspaper or watch the news on TV and if they do, it is often likely to be local news or something specific to their interest or vocation.  Products from countries like Chile, South Africa, Greece, Vietnam, even those that are successful,  just don’t have top-of-mind awareness here.  (A rude awakening has been coming to many American companies as they find American cachet diminishing, which means more hard work for us to sell abroad.)

A by-product of internal focus is the notion of “American exceptionalism”.  Personally, I find this to be both arrogant and naïve on the part of Americans but it has been aggressively promulgated by one of our political parties, and is associated with blind religious faith that promotes a strong belief that God has chosen America to lead the world.  What many Americans forget is that Irving Berlin wrote “God Bless America” as a musical prayer to God to please bless us and this has been turned around so that many people believe it to imply that God does bless America at the exclusion of others.

The U.S. State Department recently announced that more than one-third of Americans now hold a passport.  Approximately two-thirds of those have traveled abroad.  Whichever number you pick, it means that the vast majority of Americans have never been out of this country.  Many of them operate on old beliefs about life elsewhere and simply don’t know how strong the middle class is and how good life can be in other countries.  Many of the cheerleaders for American exceptionalism condemn “European socialism” in the same sentence without noting that most Europeans pay far less for health care and education and take more vacation time off from work.

2.  We’re less well educated

This is closely related to point number one but consider these facts:

• The U.S. ranks 33^rd in student reading performance; 27^th in math; and, 22^nd in science. (OECD Education at a Glance, 2009)
• The ratio of teachers to students in the U.S. is just below average in pre-primary education when compared to other developed countries; also just below average in post-high school education.  We do rank slightly above average at the lower and secondary education levels. (OECD, 2005)
• We rank 9^th in national IQ scores but 21 other countries including Mongolia, Estonia and Poland.  (We can take pride in tying Latvia and just narrowly beating out Belarus, Malta and the Ukraine.) (Lynn/VAnhanen Study)
• The U.S. ranks 27^th in gender equality, a key sign of both education and modernity. (WEF, 2008)
• In the recent WEF 2011/2012 rankings, the U.S. finds itself 13^th in higher education and training, 20^th in technological readiness, 10^th in business sophistication, and 26^th in overall education,
• We rank 12^th in overall human development (UN Development Program, 2008)

I’ll never forget walking into a neighborhood restaurant in the town of An Giang, Vietnam, near the border of Cambodia, truly a different world, and seeing about 15 patrons riveted to the TV over the bar as they watched clips from the PBS Nightly News hour and then debated an interview with Donald Rumsfeld that they just saw.  Can you imagine the reverse in a similar scene in the U.S.?  Not likely.  It’s a generalization but foreigners tend to know more about the world and even about the U.S. than Americans do.

A Norwegian pharmaceutical executive told me a story about looking for a U.S. marketing partner.  While driving along the Delaware River near Trenton, New Jersey, he asked his prospective partner, “Isn’t this near where Washington made his famous crossing?” to which the chief marketing officer replied, “I don’t know.  I don’t follow that stuff.”  The Norwegian decided that if the man didn’t know the history of his own country that he didn’t want him as a business partner.

So what does this mean for foreign marketers wanting to enter the U.S. and expand their market?

First, don’t assume we know anything about you or your products.  Despite our flaws, we live in the most competitive market in the world and largest developed market.  You’ll need to educate us and that will take some time.

Second, there are so many competing products in the U.S., both domestic and foreign, that the quality of your products often matters less than the relationships you build with us.  We always say, “all things being equal, we’d rather do business with friends.”  Become friends with us.  Develop relationships.  Become a part of our networks and communities and like the first, that doesn’t happen overnight.

Third, find ways to link your values and experiences with ours.  What do you have in common with us?  Do you play baseball or basketball?  Fine, so do we.  Talk about it and you’ll connect more often.  Are you troubled by high taxes, inconsistent investments or supporting the elderly?  These trouble us too.  Show us how we’re alike and we’ll be more accepting of you and your products.

Finally and most important, think strategically, not tactically.  You need a consistent direction here in order to break through the clutter and to be successful, it should be based on the unmet needs of the U.S. market, not your perceptions of who you think you are (if you’re not convinced, start from the beginning of this article again).  A strategy based on market needs will trump tactics every time.  A set of ad hoc tactics that are not integrated or tied to a strategy won’t cut it.

And if you’re confused about market needs, adapting or developing your strategy or what kind of tactics work, all you need to do is ask us.

Tags: Americans, Assumptions, Brands, Canada, Change, Chevy Nova, Chile, Coca-Cola, Cold War, Creativity, Due Diligence, Exceptionalism, God Bless America, Governments, Greece, Irving Berlin, Latin America, Levis, Marketing, McDonalds, Media, Mexico, Mistakes, OECD, Outcomes, Positioning, Socialism, South Africa, Strategy, Trade Associations, U.S. Marketplace, UN, Vietnam

Did you notice what began right after Thanksgiving?  I’m not talking about holiday shopping, although if you haven’t started yet, join the club.  We weren’t even into the week after the holiday when I saw my first set of predictions for 2012.  By now they’re coming out at full throttle.  Predictions for food, wine, technology, social media, fashion, you name it, they’re on their way.

Some people make predictions to show how prescient they can be.  Others do it as a new business ploy, thinking that their business prospects will be swayed by their foresight.  One thing I haven’t seen yet is anyone measuring their success for the predictions they made for 2011.  I don’t think we’ll see much of that since it’s not part of the sport.  But I’m going to change that.  I’m joining the club of predictors and prognosticators and making twelve predictions for 2012, one for each month.  And I predict that they will all come true – 100%.  I’ll come back in a year to check and see if I’m right and then expect a crescendo of congratulations.  So here goes:

1. People will talk. You can bet on it.  With a national election next year, the economy trying to rebound and the usual celebrities acting out, there will be plenty of chatter on TV, radio, the all-important blogosphere and by the office coffee maker.  If you decide to spend the year in some distant atoll in the Pacific, don’t fret, you won’t miss a thing.  It will all happen again in 2013.
2. People will be interested in themselves. Face it.  There’s not a lot of altruism in the world.  Even those who say they’re altruistic often aren’t.  Political, business and social motives often spur our eleemosynary sides (always looking for an opportunity to use “eleemosynary” – look it up).  I’m not preaching about this.  I suffer from the same affliction.
3. We will become more distracted. It’s been said many times.  There’s too much information and too many ways to communicate.  It’s becoming increasingly difficult to focus.  That’s not going to change.  Huffington Post will probably add twenty more sections for us to while away the time.
4. We will become more desperate. I’m going to take credit for something.  In 2009, I gave a presentation in Chile about business prospects in the U.S. during the recession.  At that time, I said the U.S economy wouldn’t return to some semblance of normal until 2014 at the earliest and most likely, not until 2016.  Why?  As large as our economy is – $14 trillion – it can’t recover quickly when our housing value loss is about one-third and real unemployment (reported + unreported) is probably closer to 16% than the reported 8.6%.  We dug a giant hole for ourselves by conducting two wars and cutting taxes at the same time.  Most Americans wish someone, anyone, would wave their magic wand and make things better.   It doesn’t work that way.  We have the patience of a two-year old.  I hope I’m wrong but I’d bet $10,000 of Mitt Romney’s money that we’re not.  If you’re one of those impatient types, plan your desperation calendar now.
5. The economy may get worse but it could get better. Having just said that we’ve got a long row to hoe, we’re going to see some cycles in the midst of our misery.  Expect the current administration to do whatever it can to pump things up a bit before next year’s election.  And also expect the stock market to get overly pumped up before it gets let down.  Am I being overly dreary?  No, just realistic.  They also say pessimists are often happier people because their expectations are easily exceeded.
6. All politicians will lie to us except for those who tell the truth. In our current climate, does anyone really think anyone running for election to be truthful?  They’re more likely to meet Steven Colbert’s low standards for “truthiness.”  Yet, there will be a few who will tell the truth.  They’re either the ones not running, retiring or the losers.
7. Facts will be fungible. Who says you’re entitled to your own opinions but not your own facts?  Nobody’s going to stop writing their own facts just because Tom Friedman says to in one of his brilliant columns.  The most current book next year will be, as it was this year, 1984, published in 1949 by the way.  How prescient was Orwell?
8. Everything old will be new again. It happens every year, short is back and long is out or is it long is out and short returns?  Whatever.  Gotta keep those factories moving.
9. What goes around comes around. Not all that different from #8 but the point here is to be nice to the people you meet on the way up.  They’ll look pretty good to you as you head the other way.  Success can be ephemeral, just like fashion.
10. Blame will be assigned but not to ourselves. Here comes Tom Friedman again telling us to take responsibility for our actions.  When did this guy come along?  Sadly, we are in a world where no one jumps up and says “I take responsibility, now let’s figure this out together.”  It’s too easy to point the finger at politicians, business people, the media and each other.
11. Difficult decisions will not be made but will be forced upon us. If we had begun making good decisions 30 years ago, we’d all be driving cars that got 50 miles per gallon, that’s when we’re not taking mass transit.  We’d have a fair tax code.  Banks would be our guardians instead of robbers and CEO’s would be making 10 times the average worker, not 300.  All this may happen soon but at an enormous cost and it will be forced down our throats.
12. At year-end, predictions will be made for 2013. I can guarantee this one.  There will be plenty to say next year at this time.  I’ll check to see if I’m right but I don’t think I’ll make predictions again.  I’ll just reprint this entry.

Tags: Altruism, Americans, Assumptions, Blogosphere, CEO Compensation, Change, Chile, Crazy people, Desperation, Distractions, Dreams, Economy, Election, Events, Foresight, Governments, Huffington Post, Mistakes, Mitt Romney, Outcomes, Pessimist, Politicians, Predictions, Recession, Recovery, Situation Analysis, Steven Colbert, Stock Market, Success, Tax Code, Thanksgiving, Tom Friedman, Truthiness

(See prior entry for Part 1)

My travel ordeal from 9/11 was complete and I slept through much of that day.  My plan had been to get out and see Asunción but lack of sleep and hunger took over.  Besides, as I didn’t have my luggage and didn’t know whether it would arrive, one of my priorities was finding a few basic clothing essentials in case I was going to make my presentation the next day in jeans.

After lunch at the hotel, I walked outside where some workers were erecting a large sign for the conference.  They were showing me as the second headliner.  The top dog was Alvaro Uribe, former president of Colombia.  I suppose he deserved to have his photo over mine

I walked across the street to the local mall to buy a clean shirt and underwear.  (Something about the idea of talking to 700 people in suits while wearing three day old underwear didn’t have the right appeal.)  What can you say about a mall?  They’re pretty much the same all over the world in both developed and developing countries.  That’s both comforting to a wayward traveler and a bit disturbing as we continue to lose our national identities.  Was that Benetton store I just walked by the one in the Rosebank Mall near Johannesburg?  No, remember I’m in Asunción today and it’s the Shopping del Sol mall.  How could I forget?  There’s Burger King in the corner.  Maybe I can get some good Paraguayan food there.

Underwear and socks, no problem.  I picked those up at a completely forgettable store but now I wanted a nice shirt so the conference attendees wouldn’t think I walked to Paraguay.  I walked the corridors of Shopping del Sol mall looking for the right kind of store.  Then I saw the words “Christian Dior”, the store name, “Giorgio Patrino” and most important, “Liquadacion” plastered all over the windows and underneath “40%, 50%, 60%” – my kind of place.

Like most high-end stores around the world, the well-dressed staff looked me over as I entered and saw a downtrodden mess of a man and I could tell they were considering asking me to leave.  But my quick gringo response to the salesman’s query, “solomente buscando” gave me away as someone who might have a wallet stacked with credit cards, so he gave me the run of the store and I soon found the fancy shirt section.  After a few minutes, I found a nice Italian shirt in my size.  I looked for the price and there was none on the shirt, always a bad sign.  So I asked the ever-watchful sales man for the price.  He looked at me, looked down at the shirt, smiled and said 819,000 guarani.  Now that sounds like a fortune in guarani but a quick calculation told me it was about $190, in my world, a fortune to pay for a shirt.

So, I looked at him, looked at the shirt and said, “muy, muy, caro!”  He shrugged.

I pointed to the store windows at all the Liquadación signs and cleverly said, “es imposible que el precio es correcto; es mas barrato in los estados unidos; es mas barrato en Italia”  Although, frankly, I had no idea what the shirt would cost in Italy but clearly, he could see that he was dealing with one tough hombre.  So he took out his calculator and gave me a new price, “645,000 guarani.”

I shook my head and said, “todavia mas caro.”

He went to work again on his calculator, looked back at the store manager who nodded at him and, after a moment, he offered, “385,000 guarani.”

Maybe I could have gotten him down further but he had dropped his price by more than half, so I said okay and the shirt was mine for $90.  He seemed like a beaten man, although the manager was smiling behind him.  I left content but thinking that this exchange could have taken place almost anywhere in the world.

I returned to my hotel to work on my presentation.  As numero 2, I wanted to be good and I had been asked to speak for 90 minutes, something I had done once before but it’s a lot of work to keep the masses entertained for that long.  What preoccupied my mind though was what Karin had said to me during our drive to Asuncion when I asked how they were going to get me out of the country as I was there illegally without a visa.  She said, “there may be a bribe involved.”  I began to wonder what life inside a Paraguayan prison might be like.

Later that day, I met some of the officials of the Paraguayan Trade Fairs organization.  One told me he was a good friend of Paraguay’s Vice President and assured me that I wouldn’t have to pay the maximum fine, which I learned was $6,000.  “I’m sure we can get you out for no more than $1,000.”  Good thing I got that shirt for half off.

The conference and my presentation the next day will be covered in later blog posts.  However, the organization was very professional and my session was well attended.  I had started to think about looking like Steve Jobs up on the stage wearing jeans but Karin showed up the previous night with my suitcase, so I looked pretty much like every other suit in the place, only I had a headset mike and earpiece so the simultaneous translator could tell me to slow down or repeat a sentence.

The following day, I had scheduled a lunch with a cabinet minister in Chile, a meeting that I didn’t want to miss.  I looked to see if I could get to Buenos Aires the night after my presentation so that I wouldn’t miss my morning flight to Santiago but the last flight out of Asunción was too early for me to make it.  The next morning, I was scheduled for a 6:00 am flight to BA and then the short flight over the Andes to Santiago but that meant I would have to leave the hotel at 4:00 am to go through customs and make my flight.

I had dinner that night with the owners of Paraguayan Trade Fairs.  The same gentleman who told me about paying the fine sat next to me but said nothing about my visa.  However, he was genial, interested in my speech from earlier in the day and well-traveled.  He said something to me about the region that I think encapsulates some of the culture of the countries in the southern cone region of South America, “Paraguay looks at Argentina and Brazil; Argentina looks at itself and Chile looks at the world.”  I find all three countries to be a bit provincial but Chile is certainly the least so and the one that has built a strong economy based on global exports.

Years ago, on a Scandinavian trip, I heard an expression about that region which goes, “The Finns design a product; the Swedes build it; and the Danes sell it to the Norwegians.”  These are generalizations but there is a little bit of truth in them that describes their national character.

At 4:00 am the next morning, I was bright eyed and bushy tailed (as much as one can be with four hours sleep) at the hotel when Karin, her husband and 18 month old son pulled up to take me to the airport and get me out of the country without a jail term.  This couple deserved a medal for how they took care of me, although as my local travel agents, they felt some responsibility for not ensuring that I knew about the visa.

Karin asked me how much money I was carrying.  I told her a couple hundred dollars and a little more in euros.  “Forget the euros,” she said.  I was trying to as I acquired them when the euro was about 20% higher.

When we got to the airport, she walked with me right past the security entrance to go through customs.  There was a guard there but he didn’t bother to ask for our tickets or passports but ahead of us was the usual lineup of customs agents sitting in boxes stamping passports and asking probing questions about travelers’ visits.

I waited in line for our turn, not knowing what Karin had in mind.  She pointed toward the end of the row and said, “See the guy in the last booth?”  I nodded  “That’s our man,” she said.  Now, I knew some sort of fix was in but had no idea how it would turn out.  When we got to the head of the line and it was our turn, we walked over to our “hombre elegido”.

Karin asked for my passport, handed it to him and commenced a rapid negotiation in hushed tones.  She seemed irritated at what he was asking for.  I thought about my newly honed negotiation skills buying a shirt two days earlier and was about to offer some suggestions when I heard a stamp come down on my passport like a hammer. She took my arm, walked me to the side and asked, “Could you give me $60?”  I pulled a couple hundred dollars out of my wallet and began counting twenties.  She pushed my hands down so that no one from customs would see.  I gave her the bills and she directed me toward the x-ray machines.  I lingered for a moment wondering if I was to watch her buy my way out but she motioned for me to leave.

Thus ended my trip to Paraguay.  Smuggled in and bribed out, a first and hopefully, a last for me.  The flights to Buenos Aires and then to Santiago were non-eventful except for the incredible views of the Andes.  I made it to my lunch meeting in time.

On the whole, it was a pretty interesting adventure, although one loss was that I never got time to see Asunción.  Perhaps, though, my introduction to the wonderful hospitality of the Paraguayans made up for that.

One final coda to the trip was that from the time I got off my flight in Santiago until I walked into my hotel in the city about 15 miles away took about an hour.  It was the kind of efficiency one sees in places like Zurich and wishes for in London.  The contrast to my trek to get into Paraguay was evident and I thought again about the direction these countries face and the way they are developing themselves.

Tags: Americans, Assumptions, Asuncion, Chile, Governments, Mistakes, Negotiation, Outcomes, Paraguay, Situation Analysis

I think it was around 3:30 am as we turned into a parking lot in some godforsaken place in the middle of Paraguay when I realized it was the tenth anniversary of 9/11.  That morning ten years ago, I was having breakfast with the president of one of the world’s largest public relations firms and I replayed the day in my mind.  I wanted to forge a business relationship with his firm and I think he was there out of curiosity as his agency had recently lost a competition for an agency search I conducted for a client.

Ironically, we were in a restaurant called An American Place at Lexington and 51^st, now no longer there, and had just begun our breakfast when we noticed people gathering around the TV at the bar.  We asked the waitress what was going on and she told us a plane had hit the World Trade Center.  So we got up and went to the bar to watch.  I think only the first jet had hit at that point.  Like everyone there, we were stunned but went back to our table not quite sure what to do.  It may have been that the second plane then flew into the towers or something hit us that the country was under attack.  Uncertain of what to do, we got up, talked about calling our families and then parted.  I think Andy went back to his office as one of the airlines involved was a client.  I realize now that I don’t know what the rest of his day was like.

I was working out of my home office at that time having recently moved to New York, so I returned to my apartment on 43^rd and 1^st and, like millions of people around the globe, stayed glued to the TV for the next several days.  Much of it is a blur now but an image that will always be etched in my memory is waking up the following day and seeing snow outside my window.  When I went up to the glass to look, I realized that what looked like snow falling was actually ash.  I still shudder at the thought.

Ten years later, I was sitting in the back seat of a Toyota, somewhere in Paraguay, trying to sleep with little success.  In the front seat was a Paraguayan woman, 8½ months pregnant, reclining, sound asleep and next to her, her snoring husband in the driver’s seat.  I was wired from a day of coffee and soda so sleeping was out of the question.  I wanted to get out and take a walk but we were parked near a police checkpoint and I didn’t want to raise anyone’s suspicion.  I was there illegally.

It wasn’t meant to be that way.  I had been invited to be one of the keynote speakers at a prestigious business conference in Asunción, the country’s capitol.  I had been to Chile and Argentina many times but never to Paraguay and my image of the country was outdated and based on what I knew about a former dictator who was openly sympathetic to Nazis and stories of trading in contraband.  So I was curious and had been offered a reasonable fee to speak about branding.

The trip seemed uneventful at the beginning.  Business class on Tam Linhas from New York to Sao Paulo and then I’d get my connection to Asunción.  I left New York on the 9^th so I’d get two days to see the city and form some current perceptions of Paraguay.  Everything went the way you’d want it to go on an international trip until I went to board my flight to Asunción.  I was asked for my visa.

“What visa?” I replied.

“You need a visa to enter Paraguay.” a surprised gate agent told me.  “You can’t board this flight.”

No one had said anything to me about a visa.  Not the conference organizers, not the Paraguayan travel agency that booked my flights and not the speaker’s bureau in Chile that arranged for me to speak and negotiated my fee.  Nadie.  Nada.

Within a few minutes I was approached by the airline’s security officer who explained the visa requirement to me again and then told me that they were going to put me on a flight back to New York that was leaving in a few hours.  While he escorted me to the business class lounge, I negotiated with him to have four hours to figure things out.  If I couldn’t get to Paraguay, I’d go directly to Chile where I had meetings scheduled the next week.

Once settled in the lounge, I began to email, text and call furiously to the event organizers, travel agent, speakers bureau and my wife.  “Why didn’t anyone tell me about the Visa requirement?  How are you going to get me into Paraguay, now that I’m stuck in Sao Paulo with a visa?  If I don’t hear from you in three hours, I’m going to Chile instead.”

Within my three-hour time limit, I received instructions from the event organizers that they had bought me a ticket to Buenos Aires and then another one from Buenos Aires to a town called Posadas on the Argentine-Paraguay border.  They told me I would be met there and driven to Asunción.

With my spirit of adventure in tow, I followed the instructions arriving in Posadas at close to 10pm that night.  I knew nothing about Posadas except where it was located.  The airport reminded me of other small towns around the world – two gates and served by only one airline.  It was, as the saying goes, not the end of the earth but you could see it from there.  Not only was there little activity, but neither my suitcase nor ride were there to meet me.  So here I was, in the middle of nowhere, Argentina, no luggage and no ride.

I went to the airline desk to find my bag and after the desk agent made some calls, he informed me that my bag was in Buenos Aires and he could have it in Posadas the next night at 10pm.  I asked how far it was from Posadas to Asunción and after checking with his friend in the back office, he told me five hours by car.

“¿Qué? Cinco horas! ¿Cómo peudo reciber mi equipaje cuando estoy en Asucncion?”, I pieced together with my fledgling Spanish.  Not that he needed to come up with any ideas as my whereabouts wasn’t his problem, he kindly informed me that there was a flight to Ausunción at the same time the next night and he could have my bag sent there.  Yes! One problem solved, assuming it was, in fact, my bag that he found in Buenos Aires.  I hadn’t seen it since I dropped it off at the departure counter in New York.

Now, for my ride.  It was 10:30 and after solving my luggage problem, the desk manager said, “Señor, tenemos que cerrar el aeropuerto.  No hay más vuelos esta noche y queremos ir a nuestras casas.”

My ride had not shown up yet, so again, I began to text, email and call furiously but typical of many small towns, cell connections weren’t great.  Then, I noticed one more problem.  My cell phone battery was getting low.  They were turning off the lights in the airport and the three or four staff that were there were looking at me sympathetically and sadly but not with any ideas.

I walked out in front of the airport.  There was one cab there, still hopeful that maybe he’d get me as a fare to somewhere; perhaps to my long lost Argentine cousin or to some wealthy benefactors with a large estancia on the border?  If I was going anywhere in a cab, it would be to the nearest hotel where I would spend the night and get myself to Chile the next day.  Then, I finally got a text from the people coming to get me, “We are late, the traffic has been bad but we’ll be there soon.”

I decided to trust the text not really knowing who it came from, waved the cab driver off, watched the airport staff close and lock the airport doors and head off to their cars to go home.   They waved as they went by with an enthusiastic “Buena Suerte!”  I looked around and saw there were no benches so I sat down on the curb and waited.  The thought occurred to me as I looked around and saw only some distant headlights that I might spend the night there, wherever there was.

About thirty minutes later, a car drove up and a very pregnant woman and her husband got out.  They introduced themselves as Karin and Diosnel and apologized profusely but said the traffic from Asunción had been terrible and the drive took seven hours.  I looked at my watch and grimaced with the thought that the return trip is going to put me in bed around 5:30 the next morning.  Well, it’s off to Asunción we go.

It took about a half-hour to get to the border and I was beginning to wonder how we’re going to get me across without a visa.  The only thing my drivers could tell me in a tentative voice was, “We’ll figure it out when we get there.”  It was about at this point that my phone began to receive automatic texts from ESPN telling me every time there was a score in the Michigan – Notre Dame football game.  The game was going back and forth and was a high scoring affair so it was really running my phone battery down with each text, but being a Michigan alum, I couldn’t stand the idea of turning it off.

Argentina and Paraguay are separated by the Parana River, second largest in South America after the Amazon, with customs checkpoints on either side of the bridge.  There was long line of cars waiting to cross into Paraguay, probably Saturday night revelers returning home from the high life in Posadas.  When we got to the first checkpoint, the Argentine customs agent asked for our passports.  He looked at them in a rush, stamped them all and waved us through.  Now, for the hard part I thought, entering Paraguay with no visa.  My phone sounded a text announcing that Michigan had scored again to take the lead.  I envisioned myself spending the night in a Paraguayan jail, hungry, lonely but knowing the score in the game.  But when we got to the other side, the border police simply waved us through.

“Easy peasy!” Diosnel exalted, and then, “I’m hungry.”  Personally, I wanted to just get on the road and get to Asunción as soon as possible, ever hopeful that a five to seven hour drive was a bit of hyperbole.  But Diosnel was hungry and we drove through Encarnación, a ramshackle Paraguayan border town.  I hadn’t seen much of Posadas on the Argentine side but after a few minutes driving through Encarnación, I could imagine that a Saturday night in Argentina could be quite alluring.  After a few minutes, we pulled up next to an Italian restaurant.  Is there anywhere in the world where there isn’t an Italian restaurant?  And no different than at hundreds of other similar restaurants in small American towns, the food was lackluster but the beer was spectacular.  It was called Baviera and, maybe it was the late hour and my weary day, but I could have been in Munich as I drank that beer.  Then I remembered what I had known about Paraguay as a haven for ex-Nazis and great beer in Paraguay made sense.  What else do you do if you’re an ex-Nazi in hiding?

When we left the restaurant and got back on the road, I looked at my watch and saw that it was 1:00 am.  The memory of the beer quickly faded and I prepared myself for a long drive to Asunción.  It also occurred to me that Diosnel had driven seven hours to get me and so far, another hour on the way back.  How was this guy going to stay awake to get us back?

It was a bright, moonlit night and as the small-city lights of Encarnación faded, we drove past what looked like fields dotted with palm trees – probably quite beautiful in daylight.  I tried to sleep but had consumed too much caffeine during the day and the monotony of the drive began to wear on.  That’s when we turned off the road so Diosnel could take a nap.  I looked at my watch and realized that it was 9/11.  What were the terrorists doing ten years ago?  Waking up?  Bathing and shaving all the hair off their bodies?   Preparing for their day of infamy and promised meeting with 72 virgins?

When I was growing up, I knew that places like Paraguay existed.  I had geography in elementary school and loved it.  I used to play a word game with my father.  He would name a place in the world and I would have to name another that began with the last letter of the place he named.  Then it would be his turn.  I never tired of it and it was how I learned about the world.  How else would I know about the Sea of Okhotsk or the Pirana River if my father hadn’t pulled those answers out when I thought I had him finished with no more places beginning with S or P left in the world?

I replayed the day as Diosnel and Karin slept and while I was angry that I had gotten into this situation, I was appreciative of their effort and that I could still travel to places like this ten years after an event that would change us forever.  I think I was doing what you’re supposed to do at times like that – remember and appreciate – so perhaps, the fact that I was doing that in a parking lot in the middle of Paraguay was okay.  Technically, I had been smuggled into the country.  Unsure of what the rest of the trip was going to be like or how I’d get out legally was yet to be encountered.  However, I think I gained a certain perspective on the world that day and the one I had ten years before.

In my next post, I’ll complete the story about the conference and getting out of the country.  When I asked Karin during the drive to Asunción, she said, “There may be a bribe involved.”  Not what I wanted to hear.

Tags: 9/11, Americans, Argentina, Assumptions, Chile, Mistakes, Outcomes, Paraguay, Terrorists

How is your Spanish?  If it’s at reading comprehension level, you can read the article below about our recent work with the Pisco industry in Chile. Otherwise, you can go here and click on the English translation.   In another week, we’ll be sending out our own report of our work in Chile.  If you buy a bottle of Chilean Pisco, make a cocktail (as simple as Pisco, tonic, lemon or lime and a drop or two of bitters), it will be much more enjoyable.  If you’re not already on our list to receive this report (meaning that you participated in a market research survey about Pisco), send in an email and we’ll make sure you receive the link as soon as it’s published.  It will have some great information about the cocktail market.

Salud!

Tags: Chile, Creativity, futureshift, Governments, Marketing, Pisco, Positioning, Strategy, U.S. Marketplace

I recently was interviewed by Kirk Laughlin of Nearshore Americas about nation branding with particular focus on Latin America.  The interview can be seen here or at this link.

Tags: Americans, Branding, Chile, Costa Rica, Events, Governments, Latin America, Leadership, Marketing, Miners, Nation Branding, Outcomes, Positioning, Situation Analysis, Strategy

This blog post appeared last week in NearshoreAmericas.com

The August 5^th mine collapse near Copiapo, Chile seemed like more bad luck for a country already hit by one of the largest earthquakes in history this past February.Media coverage of the mining disaster was constant and the way in which the Chilean government and miners handled the situation mesmerized the media and consumers alike. On October 13^th, millions across the globe were riveted to their TV sets watching the dramatic rescue take place, almost two months before anticipated.  It was a stunningly inspirational scene – a disaster, rescue plan and successful result – seemingly in lockstep that even Hollywood writers couldn’t have improved upon.

A Silver Lining?

At the outset of the crisis, it was hard to imagine there could be a silver lining to the story, one that could provide an advantage for how Chile, as a country, is presented to the world. Can the outcome of natural or man-made disasters have a positive impact on a country’s competitiveness in growing exports, attracting investment or seeking outsourcing contracts?  The Chilean miners’ rescue offers some interesting lessons.

1. Leadership makes a difference

There is that old saying that “a fish rots from the head”.  Conversely, positive, focused leadership trickles down throughout an organization and effects planning, implementation and results.  Chile’s focused leadership from President Sebastian Piñera and particularly Mining Minister Laurence Golborne made a difference in how the rescue effort (managed more like a large construction project) was strategically planned and implemented.  The plan allowed for international cooperation, options, customer relations (i.e. miners’ families), and management of public expectations.

2. Emotion and egos get you nowhere; help moves you forward

Chile offers a diverse mix in its socio-economic strata.  Much of the country feels like a highly developed nation.  There is a thriving middle class, high literacy and education rates, advanced use of the Internet and telecommunications.  Yet, there are pockets of extreme poverty and underdevelopment that give a very different picture.  It’s certainly a very long way from Haiti to Chile but Chile still is not at the level of many developed countries which probably explains why the country ranks #30 in the Global Economic Forum’s World Competitiveness Report and not higher.  The Chileans didn’t ask for charitable contributions but did welcome cutting-edge technology and advice from other countries with the goals of beating the expected result of not getting the miners out until mid December.  The U.S. has not responded in as focused or timely a way when it has been hit by disasters.  American egos have gotten in the way of accepting foreign help.

3. Media needs to be managed but not catered to

While the media savvy crisis mangers in Chile worked with the international journalist community, platitudes and wild claims were avoided and the focus was kept on what needed to be done.

For example, the Wall Street Journal published a story “Chile Mining Minister Is Resourceful in Rescue” in which writer Matt Mofffett wrote about the response from the Chilean government, dominated by former business executives.  Centered around Mining Minister Laurence Golborne, a former retail executive, the story traces Golborne’s early missteps in the crisis to gaining the confidence of the miners and their families.  It praises Golborne’s communication skills in dealing “with people from lots of different social strata” and goes on to cite the oft repeated catchphrase for the current government, “Chile Inc.”

Then, on September 10^th, an article appeared in Universal Knowledge@Wharton, the newsletter of the esteemed Wharton School of Business’, titled, “Lessons on Leadership and Teamwork – from 700 Meters Below the Earth’s Surface”.  The article is an interview with Francisco Javier Garrido, a professor of strategy at various MBA programs in Europe and the Americas.  Garrido talks glowingly of the miners and their leadership skills.

These are the types of stories, not the ones about mistresses or movie deals, that will be long lasting and have true value for Chile’s image and competitiveness.

4. Results can reveal societal traits

In the Wharton article, Garrido details the miners’ skills in situation analysis, overcoming elementary responses, viewing efforts as a function of goals, teamwork, ethical coherence and integrity and communication skills.  These 33 miners, he notes have taught “the business world that you need to act with flexibility when it comes to achieving your goals.”  He further points out, “There are lessons here that transcend the world of business instruction when it comes to [defining] such expressions as “decision making,” “leadership” and “teamwork.”

Since the successful rescue, there have been hundreds of articles and blogs adding to the comments on work skills of the miners and leadership of Chilean officials.

Given the positive results of managing this crisis, two questions arise:

First, is it ethical to use the story of the miners to profile or position Chile or Chilean businesses? If used in a tactical way, it seems inappropriate and opportunistic to promote such a story as saying something positive about a company, sector or country.  To those who read the media coverage, the lessons are there for us to see.  The story illustrates how leaders can respond to crises and victims can show behaviors and values that can teach us about disaster response.  Finally, it shows us how leadership can operate in the midst of crisis and media can respond positively to not overreact as so often takes place, but to manage for what everyone hopes will be positive outcomes.

Second, what real impact does crisis management have on a country’s image? Several months ago, in Nearshore Americas, Simon Anholt, a British branding consultant asserted that there is no evidence to show that marketing communications can change a country’s image (see “The Latin America Image Issue:  Going Beyond the Superficial to Create a ‘Nation Brand’.”) Anholt said, “Influencing a country’s reputation is primarily a matter of policy, strategy, innovation and investment over a very long period – it has nothing to do with logos, slogans, advertising or PR campaigns.”

The World Watches

All of this is true but it ignores the impact of what happens when a country exercises strong management tools to solve a difficult problem while the world watches.  Few would dispute that Chile’s positive awareness is much higher today than it was before the mining accident.  It is a result of both what the Chileans did and what they said working with modern media and marketing communications as part of the overall management of the crisis.

The miners’ rescue won’t change Chile’s ranking on the global competitiveness index but it will open doors in the U.S. and elsewhere for Chilean businesses that never looked at the country before.  How long those doors stay open and whether they lead to new business will depend on how well Chile manages from this point forward.

Tags: Change, Chile, Chile Inc., Cris Management, Customers, Emotion and egos, Francisco Javier Garrido, Global Economic Forum, Governments, Journalists, Laurence Golborne, Leadership, Marketing, Matt Moffett, Media, Miners, Nearshore Americas, Opportunism, Outcomes, Positioning, Sebastian Pinera, Simon Anholt, Situation Analysis, Strategy, teamwork, UniversalKnowledge@Wharton, Wall Street Journal, Wharton, World Competitiveness Report