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It’s become the new buzzword in Entrepreneurship circles thanks to Eric Ries and his Lean Startup concept:

Lean startup guru Eric Ries recommends that start-ups refine their business models through small tweaks—or pivots.

Truth is, Pivot is the same thing as the Observe and Orient in O.O.D.A.

Basically, you do something. You get feedback. And you act on that feedback. Sometimes the decision is made on-the-fly, other times it’s made after you’ve tried different things. You may decide to move in a different direction than before or tweak your existing approach. Whether this qualifies as a Pivot or not is really just a matter of wording.

If you’re practicing The Pivot, you’re just really being strategic.

What’s your take?

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Here’s more in-depth look at how Guestology works:

The power or the Disney Magic comes from knowing customers and looking beyond the words being used to figure out how to exceed guest expectations. Something that happens on-site may not be our fault, but it is our problem. And that means that it must be fixed to exceed expectations.

Disney even has a Guestology compass: Needs – basic, Wants – preferences associated with needs, Emotions – the positives, and Stereotypes – maximize positive stereotypes/minimize negative ones.

I’m a big Disney fan and had no idea about Guestology. Very exciting!

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There were a lot more interesting reads this week, check out my Delicious bookmarks on Innovation for more.

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Our first meeting was Wednesday. We met at (ironically) Bar20 at VIA Corporativo, which is one floor beneath my office. There were about 15 of us and we had the place all to ourselves. We sat in a circle, and to get things rolling we introduced ourselves.

The 2nd person to introduce himself is an inventor. Among other things, he worked on the Nintendo Wii controller about two years before the Wii came out. As you can imagine he’s a very interesting person. He spent about 10 minutes talking about his career. This set the tone for everyone else. I soon started thinking: Let the I-out-credential-you begin!

The next round of people went all out, talking about how they got their MBA’s or PhD’s from this or that school. Some just couldn’t hold themselves back from stroking their ago a little bit. Yada-Yada-Yada…

Next up, me. I was the second-last so I got to listen to everyone before they knew anything about me. I said something like this:

First of all let me make myself clear. I don’t have an MBA or a PhD like most of you here. And this is important because if we’re talking about innovation, I’m proud to say I don’t need them. Because while I was in College studying Computer Engineering, I would sit in on classes from bio-chemistry, electrical engineering and industrial engineering. Everyone thought I was a little nuts.

My parents begged me to get an MBA. My mom said that by having one I could go on and become the CEO of Disney (I love Disney). This was a persuasive tactic but it never rubbed off on me. Pretty soon I got tired of hearing the same old explanation, and one day I simply said: I don’t need an MBA or PhD because I have an MBA in Curiosity.

Bang! Everyone laughed.

It’s no disrespect to anyone who has an MBA or PhD. I know more than a handful of people with some serious credentials (on Twitter mostly) who I have learned a lot from, and highly respect. It’s just that, I think curiosity has no boundaries.

If you want to learn about something, educational material like books and people are only a click away these days. It’s easier to learn today than it ever has and I wish I had access to this amount of knowledge back when I was in school. Truth is, we’re still learning. If anything I think the whole educational system is being shaken from its roots. But that’s a topic for another post.

The point is, the inquisitive mind has no boundaries.

For now, these group meetings look like they will be interesting. Overall, it was good. It was entertaining. It was nice to know (up front) that there’s some intellectual firepower in the group.

I know I got their attention.

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Indeed, research into expertise and expert performance explains how great strategists use mental frames to break cognitive barriers that prevent others from seeing new options. It is not just that experts know more about the problem—in fact they often know less—but they think differently. They restructure, reorganize, and refine their representation of knowledge so as to more efficiently apply knowledge to solve problems.

Thinking differently is just a matter of shifting your frame. Of seeing things from a different point of view. But what inhibits us from being able to think differently?

More specifically, what happens inside our minds that limit our capacity to think differently?

According to Paul J Feltovich, Michael J Prietula, K Anders Ericsson there are three limits of human capacity we must overcome to think differently:

1. We have a limited ability to concentrate. We cannot perceive and pay attention to all of the stimuli we are exposed to—sight, position, time/speed, distance, and spectra/color. This means we must constrain what we pay attention to.
2. We struggle with limited working memory capacity. Solving a problem requires three actions: (a) we perceive data or information, (b) we bring forward relevant knowledge from our long-term memory into our short-term memory, and (c) we draw inferences about what is going on in order to choose an action or to seek additional data. Since we draw inferences only from what is in our short-term memory, our ability to solve problems is limited by our capacity to hold information there.
3. We struggle with limited long-term-memory access. We have all experienced being unable to access the relevant long-term memory, such as when something is on the tip of the tongue. We are aware that we know something but cannot retrieve it from long-term memory.

With that said, the next question is: How do we overcome this cognitive limits?

And that will be my next post.

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It is. But not because people think it is, but because Apple defined it as such. Experts characterized the iPad as a tablet, but customers did not. That’s all that matters.

Other examples of category creation exist. For example Gatorade created the sports drink category. Chrysler created the minivan. Toyota created the Prius. Each had a good amount of time before any competitor entered the space.

So why is it that you should embrace creating new categories?

From a competitive perspective, here are four reasons:

• Because competitors stop thinking. It’s much easier to prove the viability of a product that fits an existing category than a one that creates a new category. How many times have you been successful at pitching your boss without being able to say “the market for tablet PC’s is projected to grow X percent over the next five years.”
• Because competitors can’t adopt your frame of the world because it’s not consistent with theirs. Zappos says that they are in the customer service business, not the shoes business. What business are you in?
• Because competitors fear what they can’t understand. Competitors have never experienced an iPad before, so they cannot imagine the product succeeding. As a result, they dismiss the product’s potential.
• Because competitors will eventually wake up and will try to catch up by copying you. Being first doesn’t necessarily mean that you are in the drivers seat. Though sometimes playing from behind is better because you get to see everyone’s mistakes first so you can then exploit them.

Of course, all of this sounds pretty simple. But it’s amazing, at least where I am, how overlooked it is in business circles.

The only way to grow, with rare exceptions, is to engage in category innovation, to create a new category (or subcategory) and then manage the perceptions toward, the purchases of and loyalty toward that category. To that end, the brand should become the exemplar or representative of the category, but the focus should be on the category not on the brand. It should be “my category is better than your category” rather than “my brand is better than your brand.”

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But it’s far from common to see it actually applied.

I have a client who just expanded it’s business to Tijuana. They are in 3 other states within Mexico and they’ve grown quite fast for a young company (4 years old). But their expansion to Tijuana has yet to pay off. And it’s getting dicey as customers have been leaving.

They brought me in to investigate why and develop ways to turn this around.

I’ve spent the last month or so practically living their business. Experiencing what they and how they do it from both the customers POV and the OPS POW. I’ve interviewed a handful of people from both sides. My client targets a very specific niche, people who are willing to pay a premium for the services they offer. So these people know what great service means and expect it.

I won’t drown you in all the psychoanalysis (instead of business analysis) of what I’ve uncovered, but when a business thinks it’s over-delivering and it’s customers feel it isn’t, then we have a serious perceptual gap to fill.

If words aren’t accompanied by actions, it’s B.S. And when this happens, customers will happily live without you.

This is the situation. And last week when I had a meeting with the Client Experience Executive to give her the A.A.R. (After Action Review) , I asked her one question: At what point do you think a product/service becomes common? Or to put it more bluntly, at what point did you become boring?

Bang!

Blank face. Eyes got big. I went over some of the information I found and she couldn’t believe it. It’s as if I was talking about a different world. It’s not to say she didn’t know about some of things I told her, but nevertheless she was surprised.

Now this particular client is not close minded, if anything they are quite open. That’s the reason I like them. They really want to innovate and are open to ideas. With that said, I showed her this article by Martin Lindstrom that highlights the point of this post with a story:

Several years ago, I checked into the Peninsula Hotel in Chicago. I asked the concierge if it was possible to borrow some music CDs. Over the years, I’d grown accustomed to listening to music supplied by other hotels in the Peninsula group. It’s a service they offer to all their regulars. As the hotel was new, the clerk politely informed me that this particular Peninsula had no CD library. Oh, well, so it goes. Yet minutes later, the concierge called to ask me what my favorite music was. Eminem, ABBA, and the Beatles, I replied. I was curious about this, but it slipped my mind as I continued working.

About 20 minutes later, I heard a knock on my door. When I opened it, the concierge handed over a small bag containing three CDs. You guessed it: Eminem, ABBA, and the Beatles. “This is a personal present from us to you,” the concierge said. “Welcome to the Peninsula.”

Now’s let’s pause here for a second. I’ve related this anecdote to hundreds of thousands of people attending my conferences–and to millions who have watched my TV appearances. My guesstimate would be that some 15 million people have heard this story. The cost to the Peninsula? About $22.50.

Needless to say, the Peninsula experience is far from common. However, every time I hear consumers raving about a brand, almost without exception it’s been the result of the brand over-delivering.

Bingo!

If you want customers talking about you, over-deliver. Period.

In the world we live in today, where it’s fast paced and unpredictable, our business models are in a constant state of flux. And so are our customers. When you say that whatever you did before will work again, in a different context, you’re kidding yourself. The world of business is dynamic, and people’s expectations are changing constantly.

You must try to find way to over-deliver constantly. To experiment with fresh approaches and to keep yourself young and dynamic. Over-delivering is closely related to the customer experience. And if the customer experience you provide is unique, it is the most defensible asset you will have. It’s very difficult to copy a unique customer experience. How many have tried to copy Disney but failed?

Exactly.

And as you can see from the example above, the smallest details matter. And for the most part, they don’t cost you a dime. Sink in yet?

No? Let’s do this then, take yourself out of your employee mindset and put yourself in your consumer mindset and ask yourself: Do you remember the last time you got more than you expected?

Now ask this of your company: Do we remember the last time we did more than our customers expected?

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