Game-Based Marketing – Gabe Zichermann & Joselin Linder

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“Funware is a design philosophy that helps us mesh games with marketing.” (29)

“Everything can be made more fun.”

“Game mechanics are levers used to drive user behavior.”

“Passive games are different from active games in that most players don’t even realize a game is being played.” (43)

“Points provide the basic underpinning of scorekeeping, and social networking sites provide a unique opportunity to drive scoring behavior.”

“Rules, whether obvious or not, are essential both for maintaining order and for effective Funware design.”
 

Success is much less interesting if it’s not social and others don’t see you win.

 
“Social networks provide an unparalleled opportunity to market using game mechanics.” (62)

“Leaderboards are often the best initial Funware mechanics to use as they are cost-effective and easy for users to understand.”

“Even simple leaderboards like the ‘friend count’ on Facebook can have a profound effect on user behavior.”

“Point systems let you incentivize many behaviors and fine-tune the value of actions and cost of rewards at will.” (89)
 

Badges and their conspicuous display are an essential mechanism for conveying and reinforcing user success.

 
“Levels and status are powerful tools for creating loyalty and driving user behavior.”

“Although prizes generate a lot of PR buzz, they don’t deliver lasting loyalty in and of themselves.” (110)

“Frequent flyer ‘games’ are among the most successful and popular loyalty programs.” (139)

“Points in [frequent flyer programs] are often used to encourage incremental elevations in expenditure.”

“The virtual goods market is growing rapidly from a $5.5 billion level in 2009.”
 

Even noncompetitive people will compete in competitive situations. (159)

 
A major consideration in game design is the type of player the game is supposed to attract. In the context of Funware, there are five main player types:

  • Achievers
  • Driven by a desire to meet goals and gain status and points. They prefer a game that is winnable, although playing well may be more important than finally winning. Perhaps most importantly, they desire praise and recognition, and so do not like games that only attract other achievers.

  • Socializers
  • Want to meet and interact with other people in their game. They prefer cooperative to competitive play, and generally have long lists of friends and contacts.

  • Explorers
  • Like nothing better than digging through a complex environment and uncovering new challenges and tasks. They are most likely to set their own goals, and so do not need a game with extensive leveling systems or objectives.

  • Killers
  • Are competitive and love beating other players or showing off their power. Games must be winnable to attract killers, and they prefer it if the odds are stacked in their favor.
     
     

    Brands that implement games early will be at a distinct advantage over latecomers.

     

    Generation G is the most technologically savvy, competitive, and socially networked. (180)

     

    Kids who grow up on games are going to expect gamelike experiences in all aspects of their lives.

    The Personal MBA – Josh Kaufman (Working With Others)

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    Force is all-conquering, but its victories are short-lived…Nearly all men can stand adversity, but if you want to test a man’s character, give him power.

    -Abraham Lincoln

     
    “The major benefit of self-education when working with others is knowing what skill looks like.” (276)

    Avoid bloated committees – keep your teams “elite and surgical.”

    “Effective communication can only occur when both parties feel safe. As soon as people start to feel unimportant or threatened in a conversation, they start ‘stonewalling,’ shutting down communication. The threatened party may continue to interact, but mentally and emotionally, they’ve withdrawn from the conversation.” (280)
     

    Never tell people how to do things. Tell them what to do, and they will surprise you with their ingenuity.

    -General George S. Patton

     
    “Micromanaging isn’t simply annoying – it’s extremely inefficient. Not only does spelling out every single detail make people feel less important, it actually impairs their effectiveness. No set of instructions, no matter how detailed, is capable of covering every contingency. When something inevitably changes, micromanagement fails.” (284)

    “Commander’s intent is a much better method of delegating tasks: whenever you assign a task to someone, tell them why it must be done. The more your agent understands the purpose behind your actions, the better they’ll be able to respond appropriately when the situation changes.”

    “When you communicate the intent behind your plans, you allow the people you work with to intelligently respond to changes as they happen.

    “The best way to eliminate Bystander Apathy in project management is to ensure that all tasks have single, clear owners and deadlines.” (286)
     

    The way to get on in the world is to make people believe it’s to their advantage to help you.

    -Jean de la Bruyere, seventeenth-century essayist

     
    “Convergence is the tendency of group members to become more alike over time…Convergence also means that groups have a tendency to police themselves. The norms of a group work like gravity – if they are violated, others will exert an influence on the rebel to bring them back in line.” (291)

    “The best testimonials don’t necessarily contain superlatives: amazing, best, life-changing, and revolutionary have been so overused that people expect them and discount their expectations accordingly. The most effective testimonials tend to follow this format: ‘I was interested in this offer, but skeptical. I decided to purchase anyway, and I’m very pleased with the end result.’

    “The reason this format is more effective than a litany of people gushing about your offer is that it more closely matches how your prospects are feeling: interested but uncertain.” (294-5)

    “People have an inherent tendency to comply with Authority figures. This tendency begins in childhood – we wouldn’t survive for very long if we didn’t obey our parents most of the time. As we grow up, we’re socialized to respect and obey other Authority figures: teachers, police officers, government officials, and clergy. As a result, when an Authority figure asks us to do something, we’re very likely to comply – even if the request isn’t appropriate or doesn’t make sense.” (295)

    “Developing a strong reputation in a certain area confers the benefits of Authority.” (296)

    “Obtaining small commitments makes it more likely people will choose to act consistently with them later.” (298)

    “By compensating their salespeople on a salary basis and giving generous bonuses based on long-term performance, (Norm) Brodsky and (Bo) Burlingham encouraged (their salespeople) to focus on making profitable sales versus sales at any cost.” (299)

    “In the case of conflict, Perceptual Controls win over incentives every time.” (300)

    “The best way to avoid Modal Bias [the assumption that our idea or approach is best] is to use inhibition to temporarily suspend judgment. Part of the value of understanding cognitive biases is the knowledge that you’re not immune to them, and simply knowing they exist doesn’t make them any less influential. Modal Bias is automatic – we have to use willpower to overcome it.” (301)
     

    High achievement always takes place in the framework of high expectation.

    -Charles Kettering

     
    “In How to Win Friends and Influence People, Dale Carnegie recommends ‘Giving others a great reputation to live up to.’ ” (302)

    “The Pygmalion Effect [the tendency of our expectations of others to become self-fulfilling prophecies] also features a paradox: having high expectations of people will produce better results, but it also increases the probability that you’ll be disappointed. The Expectation Effect means that our perception of the quality of someone’s work is a function of our original expectations.” (302)

    “If you’re doing a formal assessment of someone’s performance, remember to judge performance objectively and quantitatively as much as possible.”

    Josh Kaufman’s summary of management

    The Personal MBA – Josh Kaufman (Working With Yourself)

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    To think is easy. To act is difficult. To act as one thinks is the most difficult.

    -Johann Wolfgang von Goethe

     
    “Monoidealism is the state of focusing your energy and attention on only one thing, without conflicts. [Also known as a 'flow' state] (229)

    The first key to achieving a monoideal state is to eliminate distractions; Kaufman claims that it takes roughly 10-30 minutes of uninterrupted time for your mind to become fully absorbed in the task.

    If you feel an inner conflict about doing your work, explore it rather than repress it – your mind is often trying to tell you something important.

    When you’re really feeling resistance, try the Pomodoro Technique: set a timer for 25 minutes and focus on a single task for the entire duration of the time, then take a 5 minute break when it’s done.

    “If you eliminate distractions and Conflicts before you start your dash, you’ll naturally transition into a Monoideal state a few minutes into the work period.” (231)

    Kaufman also recommends meditation as a way to become resistant to distractions.

    “While many people assume [multitasking] makes them more efficient, Monoidealism and multitasking are complete opposites. Neurologically, it’s impossible for your brain to multitask. When you’re trying to do more than one thing at a time, you’re not really parallel processing – you’re rapidly switching your Attention from one thing to another.”

    “Every time you switch the focus of your Attention from one subject to another, you incur the Cognitive Switching Penalty. In order to take action, your brain has to ‘load’ the context of what you’re doing into working memory. If you constantly switch the focus of your Attention, you’re forcing your brain to spend time and effort thrashing, loading and reloading contexts over and over again.” (232)

    In order to avoid mentally demanding context-switching, batch similar tasks together, i.e., have a block of time where you do all of your creative tasks.
     

    The Four Methods of Completion

    1.) Completion – doing the task completely; this is the option most people think about, but it should only be used for important things that you can do particularly well.

    2.) Deletion – eliminating the task; use this for tasks that are unimportant or unnecessary. “If it’s not worth doing, it’s not worth doing well or quickly” (233)

    3.) Delegation – assigning the task to someone else; used for important tasks that someone else can complete almost as well as you can (or even better).

    4.) Deferment – putting the task off until later; effective for tasks that are somewhat important, but that certainly aren’t critical.
     

    “Saving noncritical tasks for later is a good way to keep your attention and energy focused on what’s most important…Periodically reviewing this list when you’re looking for something new or exciting to do is quite useful.” (234)

    “A Most Important Task (MIT) is a critical task that will create the most important results you’re looking to achieve. Everything on your plate is not critically important, so don’t treat everything on your task list equally…At the beginning of every day, create a list of two or three MITs, then focus on getting them done as quickly as possible.” (235)

    Some other points about MITs:

  • keep your MIT list separate from your other to-do list
  • use self-elicitation questions such as “What are the two or three most important things that I need to do today?” to help you generate the list of MITs
  • combining the MIT technique with Parkinson’s Law by setting an arbitrary deadline for your MITs, such as 10:00am, is extremely effective
  • all of this will help you maintain a monoideal state
  •  
    “For best effect, your Goals should be under your control. Goals like ‘losing twenty pounds’ are soul crushing because they’re not directly under your control – losing weight is a result, not an effort.” (237)

    Kaufman distinguishes between States of Being (such as happiness) and goals: the former shouldn’t be seen as a fixed achievement, but rather, a measure of the quality of your present experience. States of Being make for great decision criteria, but they lead to frustration if seen as a fixed goal to be achieved in the future.

    “For best results [in behavior change], focus on installing one habit at a time. Remember, you only have so much Willpower to use each day, and overriding your default mode of action depletes it quickly…Focus on installing one habit until taking action feels automatic, then move on to the next.” (240)
     

    Out of the available options, which experience do I want to have?

    -Steve Pavlina’s “tiebreaker” question when making a difficult decision

     
    “The Next Action is the next specific, concrete thing you can do right away to move a project forward. You don’t have to know everything that must be done to make progress on a project – all you need to know is the very next thing you can do to move the project forward.” (246)

    “One of the quirks about how your mind works is that it handles information from outside your head better than the thoughts that are rattling around inside your head.” (248)

    “There are two primary ways to Externalize your thoughts: writing and speaking. Writing (or drawing, if you prefer) is the best way to capture ideas, plans, and tasks. Not only does writing give you the ability to store information in a form you can reference later, it gives your mind the opportunity to examine what you know from a different angle. Challenges and issues that seem insurmountable while they’re bouncing around in your frontal lobe can often be solved surprisingly quickly after they’re put on paper.”

    “If you want to be productive, you must set limits. Juggling hundreds of active tasks across scores of projects is not sustainable: you’re risking failure, subpar work, and burnout.” (260)

    “Limits always have consequences – if you’re not prepared to handle the consequences, it’s not really a limit.”

    “Like all biological organisms, humans need to rest and recover for peak performance. Taking a break isn’t a sign of laziness or weakness – it’s a recognition of a fundamental human need…Sleep deprivation results in a prolonged down cycle, which gets in the way of getting things done.” (262-3)

    “The more Attached you are to a particular idea or plan, the more you limit your flexibility and reduce your chances of finding a better solution…If you become too Attached to the visions you have in your head, you’ll have a hard time adjusting to the inevitable twists and turns of life.” (270)

    Kaufman recommends putting a small percentage of your monthly income into a “Personal Research and Development (R&D) Budget”, money you can use (guilt-free) to purchase books, courses, conferences: anything that will help you improve your skills and capabilities.

    The Intelligent Investor (Chapter 1: Investment versus Speculation)

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    ["The Intelligent Investor: The Definitive Book On Value Investing" was written by Benjamin Graham, with commentary in the latest edition by Jason Zweig.]
     
    Graham’s definition of investing: “An investment operation is one which, upon thorough analysis, promises safety of principal and an adequate return.” (35)

    Many people think that they’re investing when they’re really only speculating.

    “[Speculating is] the worst imaginable way to build your wealth. That’s because Wall Street, like Las Vegas or the racetrack, has calibrated the odds so that the house always prevails, in the end, against everyone who tries to beat the house at its own speculative game.

    “On the other hand, investing is a unique kind of casino – one where you cannot lose in the end, so long as you play only by the rules that put the odds squarely in your favor. People who invest make money for themselves; people who speculate make money for their brokers. And that, in turn, is why Wall Street perennially downplays the durable virtues of investing and hypes the gaudy appeal of speculation.” (36)

    “An investor calculates what a stock is worth, based on the value of its businesses. A speculator gambles that a stock will go up in price because someone else will pay even more for it.”
     

    A cynic knows the price of everything, and the value of nothing.
    -Oscar Wilde

     
    However, Graham does acknowledge: “Without speculation, untested new companies would never be able to raise the necessary capital for expansion. The alluring, long-shot chance of a huge gain is the grease that lubricates the machinery of innovation.” (21)

    While speculation can certainly be intelligent, it can also be unwise if you’re:
    1. Speculating when you think you’re investing.
    2. Doing it as a career without the requisite knowledge and skill.
    3. Risking more than you can afford to lose.

    “Never mingle your speculative and investment operations in the same account, nor in any part of your thinking.” (22)

    “To enjoy a reasonable chance for continued better than average results, the investor must follow policies which are [1] inherently sound and promising, and [2] not popular on Wall Street.” (31)

    “It seems that any intelligent person, with a good head for figures, should have a veritable picnic on Wall Street, battening off other people’s foolishness. So it seems, but somehow it doesn’t work out that simply. Buying a neglected and therefore undervalued issue for profit generally proves a protracted and patience-trying experience.” (32)

    “If you look at a large quantity of data long enough, a huge number of patterns will emerge – if only by chance.” (45)
     

    The intelligent investor has no interest in being temporarily right. To reach your long-term financial goals, you must be sustainably and reliably right. (37)

    The Psychology of Selling – Brian Tracy (Techniques)

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    “Your job as a salesperson today is that of an advisor, and that of a counsellor, and that of a consultant.”

    “[Prospects] don’t need someone to try to sell them something, they need someone to teach them how what the product can do for them.”

    Maslow’s hierarchy of needs is a useful framework to have in the back of your mind when performing need analysis.

    Before you start selling something, ask yourself:
    -What are the top 5-10 features of my product?
    -What customer needs do these satisfy?
    -Why buy it from our company?

     

    Approaching the Prospect

     
    When prospects say no, it’s usually because they were preoccupied. But we are always preoccupied with SOMETHING; break the preoccupation or you will never get attention.

    “Your opening question should answer the question: ‘Why should I listen to you?’ It should then generate the question: ‘What is it?’

    If they don’t ask, “What is it?” then your opening question isn’t good enough to get your prospect’s attention and break their preoccupations.

    A major prospect concern is that you’ll use high-pressure tactics like all of the other mediocre salespeople they’ve encountered; you must convince them that you won’t.

    The most important thing to do in an opening call is to get a solid appointment.

    Call to confirm a few days before to inoculate against flakes and make a new solid appointment if something has come up for them.

    Never sell your product on the phone – the best thing you have going is CURIOSITY.

    If you’re asked to send something, say that you’ll deliver it personally and ask if they’ll be there on that day.
     

    Way of Being

     
    Interacting with people that are too different from ourselves moves us out of our comfort zone.

    We stand upright and have attentive body language so we represent our product/business well but also because our prospect is likely to mirror these behaviors.

    “The essence of selling is personal vitality.” (so always get a good sleep)

    “Smile into the phone.”

    Never knock the competition.

    One aspect of being a good listener is pausing 3-5 seconds before replying, then ensuring that your reply sounds calm and contemplative.

    Great question to elicit further detail: “How do you mean?”

    Telling is not selling.
     

    Handling Objections

     
    Interpret objections as questions (ie: “I can’t afford it” = “Show me how I can afford it”)

    Be prepared for the common objections to your product.

    In sales, the term “condition” is used to refer to an unbreakable barrier to purchase, for example: someone with no legs is going to be difficult to sell shoes to.

    “Many people, when they voice an objection, think it’s a condition. Your job is to find out whether or not it’s [truly] a condition.”

    Hear out every objection, even the one’s you’ve heard 1000 times before.

    Compliment people on their objections (ie: “That’s a very good QUESTION…”)

    “Did I explain myself clearly?”

    Always be impressed with how knowledgable people are on your subject.

    Customers will sometimes hold on to objections until late because once those objections are obliterated, they know they’ll have to buy.

    Response to non-verbal hesitancy late in the game: “Mr. [Prospect], there seems to be some question in your mind that’s causing you to hesitate about going ahead right now, do you mind if I ask what it is; is it the money?” [price is the most common objection, but prospects are often shy about admitting it; adding "is it the money?" makes it more acceptable for the prospect to admit it]

    When asked about the price, state your answer to include all of the benefits – so that in the prospect’s mind, the price is never divorced from the value it represents. For example: “This system, with x, y, and z, and including a, costs…”

    “Yes, ours is more expensive than our competitors, would you like to know why?”

    Use “if” and “what if” responses to state creative solutions to objections. For example:

    Prospect: “Our budget is used up”
    You: “Well I’ll tell you what, if you take it now we won’t bill you until your next budget period.”
     
    Eliciting hidden objections, then using them to help you close:
    -“…and in addition to that, is there any issue keeping you from going ahead right now?”
    -“Just suppose that wasn’t an issue, is there any other reason we can’t go ahead?”
    -“If (x condition was satisfied) would you take it right now?”
     

    Closing

     
    Let them give you the closing condition.

    “Any noticeable change in attitude, posture, or demeanor can indicate that a buying decision is near.”

    You have to transition smoothly into the close, don’t take a breather or hesitate for too long.

    When you close you should be happy and enthusiastic.

    “The only pressure you use in a professional selling presentation is the pressure of the silence after the closing question.”
     

    A man convinced against his will is of the same opinion still.

     

    The Trusted Advisor – David H. Maister

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    A Trusted Advisor places a higher value on maintaining and preserving the long-term relationship than on the outcome of any individual transaction.

    David Falk, the agent of Michael Jordan, reduced the size of his commission without even being asked because he sensed that it was bothering him.

    The client’s specific context and emotions should affect the advice you give; great advice is never one-size-fits-all.

    Go first: visibly demonstrate your willingness to invest in the relationship to gain the client’s trust.
     
    Listening is essential in order to earn the right to comment on – and be involved with – the client’s issues.

    Trust is both rational and emotional.

    Trust is a two-way road – you cannot build a trusted advisor relationship solely through your own effort, you need the client to participate and reciprocate by their own will.
     
    Big mistakes many advisors make when listening:

    1. Overly rational listening – listening is both rational and emotional; take the time to “absorb what you hear” and use it to build the relationship – this demonstrates a high level of caring that is essential to becoming a trusted advisor.
    2. Overly passive listening – good listening is a back-and-forth process that makes both people feel heard and understood
     
    The step that comes after uncovering a problem is NOT solving it – it’s envisioning a future without the problem (basically Need-Payoff Questions, see: SPIN Selling by Neil Rackham).

    Build a shared agenda – show that you have a “we”, not a “me” agenda.

    The Psychology of Selling – Brian Tracy (Principles)

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    While my number one book recommendation for sales is “SPIN Selling” by Neil Rackham, “The Psychology of Selling” remains a classic book in this field. This is part one of my notes on “The Psychology of Selling”, part two will cover the specific tactics and techniques he advocates using for sales calls.
     
     
    Proof of fear of rejection: if you had a list of prospects that would be guaranteed to buy from you today, you would start calling as soon as possible. Yet most salesmen only start calling at 11:00 in the morning.

    It’s difficult to get people to buy from you unless they’re confident that you are their friend and that you’re acting in their best interest.

    Tracy claims that 51% or more of closing ability comes down to enthusiasm.

    The top 3% of salespeople all consider themselves self-employed. They take full responsibility for their results.

    You can never make your customer believe in your product more than you do.

    If you’re into concrete things, you won’t have the same amount of passion for intangibles; if you’re into intangibles like psychology, philosophy, and metaphysics then you’ll be better off selling intangibles rather than concretes.

    Tracy states that 90% of all sales books are sold to less than 10% of salespeople.

    Tracy urges people to constantly read and listen to tapes; he even goes as far as to say that if you’re listening to your car radio instead of tapes, you’re not taking your profession seriously enough.

    A psychological habit that stifles most people’s productivity is that they think about their lives in terms of days or hours; so if they accomplish a lot in a short amount of time, they’ll just write the rest of the day or the hour off. Instead of falling into this trap, think about your life in terms of MINUTES.
     

    The basic law of all of human destiny is the law of sowing and reaping: you will always reap exactly what you sow, but you must do the sowing first.

    -Brian Tracy

    From the Bedroom to the Boardroom: A Brief Review of “Pitch Anything” by Oren Klaff

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    (Click on the image to view and/or download Chapter 1)
     
    Whenever I post about a book here, I am implicitly giving it my highest recommendation (except for that one time I posted about Al Gore’s “The Assault on Reason”…my bad).

    But recently, I read a book so outstanding, so ingenious, and so practical that writing somewhat-out-of-context notes about it would be a colossal injustice.

    “Pitch Anything” is already one of my favorite business books ever. It outlines a method of pitching in business settings that’s almost reminiscent of the seduction techniques outlined in “The Game: Penetrating the Secret Society of Pickup Artists” by Neil Strauss. Indeed, reading about things like frame control, prizing, and alpha behavior definitely gave me flashbacks to 2008 when I first read Strauss’s bestseller.

    But “Pitch Anything” differentiates itself from “The Game” by its frequent use of academic neuroscience research to support his ideas, as well as the fact that he’s successfully pitched billion-dollar proposals and made millions of dollars personally using the method.

    Did I mention it’s well written, peppered with truly interesting examples, and legitimately funny?

    I’m totally smitten with this book, and that’s a major accomplishment considering all of the books I’ve read this year.

    You can check out the first chapter for free by clicking on the image.

    Finally, for specific information about his method and his book, here’s an interview with Oren Klaff that covers a lot of the key ideas of “Pitch Anything”:
     
    Pitch Anything: Oren Klaff – The Mixergy Interview
     

    Steve Jobs (A Biography) – Walter Issacson

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    Note: The following passages are all direct quotes from the book. I didn’t want to completely litter this summary with parentheses so I left in ambiguous pronouns that obviously refer to Jobs. All italics are Issacson’s, all bold sections were highlighted by me.

     
    “He was more philosophical than the other people I worked with,” (Atari boss Nolan) Bushnell recalled. “We used to discuss free will versus determinism. I tended to believe that things were much more determined, that we were programmed. If we had perfect information, we could predict people’s actions. Steve felt the opposite.” (43)

    Jobs’s father had once taught him that a drive for perfection meant caring about the craftsmanship even of the parts unseen. (74)

    (Apple partner Mike) Markkula wrote his principles in a one-page paper titled “The Apple Marketing Philosophy” that stressed three points. The first was empathy, an intimate connection with the feelings of the customer. “We will truly understand their needs better than any other company.” The second was focus: “In order to do a good job of those things that we decide to do, we must eliminate all of the unimportant opportunities.” The third and equally important principle, awkwardly named, was impute. It emphasized that people form an opinion about a company or product based on the signals that it conveys. “People DO judge a book by its cover,” he wrote. “We may have the best product, the highest quality, the most useful software etc.; if we present them in a slipshod manner, they will be perceived as slipshod; if we present them in a creative, professional manner, we will impute the desired qualities.” (78)

    Throughout his career, Jobs liked to see himself as an enlightened rebel pitted against evil empires, a Jedi warrior or Buddhist samurai fighting the forces of darkness. IBM was his perfect foil. He cleverly cast the upcoming battle not as a mere business competition, but as a spiritual struggle. “If, for some reason, we make some giant mistakes and IBM wins, my personal feeling is that we are going to enter sort of a computer Dark Ages for about twenty years,” he told an interviewer. “Once IBM gains control of a market sector, they almost always stop innovation.” (136)

    On the day he unveiled the Macintosh, a reporter from Popular Science asked Jobs what type of market research he had done. Jobs responded by scoffing, “Did Alexander Graham Bell do any market research before he invented the telephone?” (170)

    Jobs had latched onto what he believed was a key management lesson from his Macintosh experience: You have to be ruthless if you want to build a team of A players. “It’s too easy, as a team grows, to put up with a few B players, and they then attract a few more B players, and soon you will even have some C players,” he recalled. “The Macintosh experience taught me that A players like to work only with other A players, which means you can’t indulge B players.” (181)

    His diet obsessions reflected a life philosophy, one in which aestheticism and minimalism could heighten subsequent sensations. “He believed that great harvests came from arid sources, pleasure from restraint,” (Jobs’s daughter Lisa) noted. “He knew the equations that most people didn’t know: Things led to their opposites.” (260)

    (Jobs and ex-girlfriend Tina Redse) had a basic philosophical difference about whether aesthetic tastes were fundamentally individual, as Redse believed, or universal and could be taught, as Jobs believed. She accused him of being too influenced by the Bauhaus movement. “Steve believed it was our job to teach people aesthetics, to teach people what they should like,” she recalled. (265)

    In (Jonathan) Ive, Jobs met his soul mate in the quest for true rather than surface simplicity. Sitting in his design studio, Ive described his philosophy:
     

    Why do we assume that simple is good? Because with physical products, we have to feel we can dominate them. As you bring order to complexity, you find a way to make the product defer to you. Simplicity isn’t just a visual style. It’s not just minimalism or the absence of clutter. It involves digging through the depth of the complexity. To be truly simple, you have to go really deep. For example, to have no screws on something, you can end up having a product that is so convoluted and so complex. The better way is to go deeper with the simplicity, to understand everything and how it’s manufactured. You have to deeply understand the essence of a product in order to be able to get rid of the parts that are not essential. (343)

     
    “When I went to Pixar, I became aware of a great divide. Tech companies don’t understand creativity…On the other hand, music companies are completely clueless about technology…I’m one of the few people who understands how producing technology requires intuition and creativity, and how producing something artistic takes real discipline.” -Steve Jobs (397)

    Like many companies, Sony worried about cannibalization. If it built a music player and service that made it easy for people to share digital songs, that might hurt sales of its record division. One of Jobs’s business rules was to never be afraid of cannibalizing yourself. “If you don’t cannibalize yourself, someone else will,” he said. (408)

    His desire to delight the user led him to resist empowering the user. (563)
     
    There were many times when he reflected on what he hoped his legacy would be. Here are those thoughts, in his own words: (567-570)
     

    My passion has been to build an enduring company where people were motivated to make great products. Everything else was secondary.

     

    Some people say, “Give the customers what they want.” But that’s not my approach. Our job is to figure out what they’re going to want before they do. I think Henry Ford once said, “If I’d asked customers what they wanted, they would have told me, ‘A faster horse!’” People don’t know what they want until you show it to them. That’ why I never rely on market research. Our task is to read things that are not yet on the page.

     

    I hate it when people call themselves “entrepreneurs” when what they’re really trying to do is launch a startup and then sell or go public, so they can cash in and move on. They’re unwilling to do the work it takes to build a real company, which is the hardest work in business. That’s how you really make a contribution and add to the legacy of those who went before.

     

    “(Firing people) was hard. But somebody’s got to do it. I figured that it was always my job to make sure that the team was excellent, and if I didn’t do it, nobody was going to do it.

     

    What drove me? I think most creative people want to express appreciation for being able to take advantage of the work that’s been done by others before us. I didn’t invent the language or mathematics I use. I make little of my own food, none of my own clothes. Everything I do depends on other members of our species and the shoulders that we stand on. And a lot of us want to contribute something back to our species and to add something to the flow. It’s about trying to express something in the only way that most of us know how – because we can’t write Bob Dylan songs or Tom Stoppard plays. We try to use the talents we do have to express our deep feelings, to show our appreciation of all the contributions that came before us, and to add something to that flow. That’s what has driven me.

    The Personal MBA – Josh Kaufman (Value Delivery)

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    “A satisfied customer is the best business strategy of all.”

    -Michael LeBoeuf, business professor

     
    The opposite of falling short of expectations is not “meeting expectations” – it is exceeding expectations.

    There are two main types of Value Delivery systems: direct-to-user and intermediary.

    The trade-off you face when you’re considering an using an intermediary is that you won’t have to do as much work and your sales can actually increase, but you’ll have less control over the Value Delivery process and you face Counterparty Risk – the chance that the intermediary will screw up at the expense of your reputation.

    The shoe company Zappos often surprises its customers by having the shoes arrive at their customer’s houses days ahead of schedule. They could advertise the fact that they do free expedited shipping, but they don’t – they think the surprise is more valuable.

    “A customer’s perception of quality relies on two criteria: expectations and performance. You can characterize this relationship in the form of a quasi-equation, which I call the Expectation Effect: Quality = Performance – Expectations.

    “Customer expectations have to be high enough for a customer to purchase from you in the first place. After the purchase is made, however, the performance of the offering must surpass the customer’s expectations in order for them to be satisfied…If performance is lower than expectations, the perception of quality will be low – no matter how good the offer is in absolute terms.” (137)

    That being said, you need to provide the baseline essentials that you promise in a Predictable manner.

    The three primary factors that contribute to a Predictable experience:
    -Uniformity (delivering the same characteristics every time)
    -Consistency (integrity across your entire product line, not doing contradictory projects that violate expectations – ie: New Coke)
    -Reliability (being able to count on the delivery of the value without error or delay)

    Throughput is the rate at which a system achieves its desired goal (calculated by Rate/Time). Three types of Throughput are:
    -Dollar Throughput (how quickly it takes your business to make a dollar of profit)
    -Unit Throughput (how much time it takes to create an additional unit for sale)
    -Satisfaction Throughput (how much time it takes to create a happy, satisfied customer)

    “If you don’t know your Throughput, make it a priority to find out – measuring Throughput is the first step towards improving it.” (141)
     

    The problems of this world are only truly solved in two ways: by extinction or duplication.

    -Susan Sontag, author and political activist

     
    Scale is the ability to reliably duplicate or multiply a process as volume increases. Scalability determines your maximum potential volume.” (143)

    “As a general rule, the less human involvement required to create and deliver value, the more scalable the business.” (144)
     

    Sometimes when I consider what tremendous consequences come from little things, I am tempted to think: there are no little things.

    -Bruce Barton, advertising executive best known for creating the Betty Crocker brand

     
    “Toyota’s approach [to manufacturing] is based on the Japanese concept of Kaizen, which emphasizes the continual improvement of a system by eliminating muda (waste) via a lot of very small changes.” (145)

    “Small changes to your Value Delivery process can save you a ton of time and effort in the long run.”

    “Scalable systems amplify the results of small changes. Small changes to scalable systems produce massive results.” (146)

    Perfecting your Value Delivery system is the key to 4-Hour Work Week-style automation.

    The primary benefit of creating a system is that you can examine the process and make improvements.
     

    If you can’t describe what you are doing as a process, you don’t know what you’re doing.

    -W. Edwards Deming, production management expert and pioneer of statistical process control

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