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Why does Microsoft disdain its own customers?

I’ve had the good fortune to spend a lot of time around many different types of companies, in a bunch of different industries.  And I’ve learned something about corporate values.

Some companies like to make money by creating products and services that really excite their customers. They genuinely put the customers’ needs first, and try to meet or exceed customer expectations. Their leaders know that if they make products that delight customers, they will end up making plenty of money. Apple talks about wanting to delight customers, and it really shows in their products.

Other companies like to make money. They are less concerned with how they earn that money. Their primary focus is making money, and they really aren’t as concerned about whether their products and services delight their customers. If they see an opportunity to make a little more money by doing something that their customers won’t like–well, they don’t see a problem with that; they go for the money. Their primary focus is making money; their customers’ needs are secondary. In fact, their customers’ needs are really only considered when meeting those needs coincides with making money.

Microsoft is the second type of company.

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99Designs—Design Done Better

Whenever I start a new business, one of the first things I need to do is get a corporate logo; most people don’t think a business is real until it has a logo. It’s a pain in the neck, and pretty expensive–both in time and money.

First, I have to find a graphic artist.  I had a great one about 15 years ago, but she stopped doing this sort of work. Since then it’s been hit-or-miss. So just finding a qualified artist who is available for a one-off project can take weeks.

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Prostitution, Drugs, Pornography, Gambling, and Religion

Silicon Valley is obsessed with business models. It’s one of the first questions we ask about any new venture: “What’s the business model?”

When I was teaching Entrepreneurship in High Technology at Stanford in the early 1990s, and later working as a strategy consultant with SDG, I started wondering just how new any business model could really be. After all, we have thousands of years of business experience behind us–are we really still inventing new models?

So I started categorizing businesses according to some basic characteristics–mostly around what they were selling and how.

I found that some companies were based on people (e.g. services companies), some required a large up-front investment, but had low marginal costs of delivery (such as software), and so forth. I also noticed that people who were good at managing one of these business models often had trouble understanding or working in the others; their instincts were all wrong.

As I grouped them together, I noticed a pattern–and it struck me how old some of these business models really are.

The basic business models I identified were:

  • Prostitution
  • Drugs
  • Pornography
  • Gambling
  • Religion
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The Beauty of Flipboard

I’ve been using Flipboard on my iPad since it was first released. It’s a fantastic application, and has won a ton of awards as a result. Apple named it the 2010 App of the Year, Oprah raved about it with MC Hammer, and Time Magazine called it one of the Top 50 innovations of 2010.

So what is so great about it?

Flipboard allows you to view articles from all sorts of sources. It’s a great way to view blogs, but it can also take your Twitter stream, or Facebook, or LinkedIn, and present those streams in a beautiful and efficient presentation. And it automatically resolves links; when your friends post a link to an interesting article, Flipboard goes out and downloads the article. In fact, this is pretty much the only way I look at Facebook now. It’s a great way to see my friends’ updates without all the visual clutter I don’t care about. And Flipboard curates a few channels on subjects such as tech, sports, and movies, where they aggregate interesting stories from around the web. Flipboard refers to all of this as a social magazine, in that your social networks actually find and recommend articles for you to read.

Above All: Style

But the truth is, I think Time Magazine got it wrong.

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How to Get a Rock-Star Understanding of Your Market

How do you describe your market?

When I ask people to describe their market, they often say something like, “Most of our customers are in their mid-20s, just out of college.” Or they might use titles: “Our customers are CIOs at healthcare companies.” And while these are reasonable answers, they lack the necessary insight to help focus the company on gaining more customers.

My next question: “How much of your market do you think you can get?”

Not surprisingly, the answer is usually some fraction, such as, “About 30%” or, “It’s a huge market–we’d be very happy with 2%.”

And that’s the problem. They’ve just described a demographic that might purchase their product or service, but they really haven’t described what motivates those people to purchase, or how they can influence that purchase decision.

Here is a simple but powerful way to segment and think about your market:

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How Much Good is that Non-Profit Doing?

How does a non-profit measure its effectiveness?

For-profit organizations can look at standard financial metrics: revenues, profits, return on equity, and so forth. But for most non-profit organizations, financial metrics are a means to an end, not the end itself. Non-profits need to pay attention to financial metrics to pay the bills; but it usually isn’t why they exist.

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You Know You Are An Entrepreneur When?

A few years ago I met a venture capitalist who tried to impress me with his entrepreneurial credentials.

“I’ve always been an entrepreneur!” he proclaimed. “After I graduated I immediately joined a little startup, named Yahoo!” He looked quite pleased with himself.

He was in his early 30’s. I thought about it a moment. “So, how many employees were there when you started?”

“Just 350 back then.” He answered smugly.

I paused. “And when did they go public? Wasn’t it around then?”

“Well, yes. Just before I joined.” Now he looked uncomfortable. Or annoyed. Either way, he seemed to think I was calling his bluff; I quickly changed the subject.

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