Emotion in Motion
Tuesday, 2 November 2004 - Dartmouth, USA
An address to Dartmouth’s Tuck School of Business. MBAs from a top U.S. business school get 10 fast tracks to success. Think with your heart. Look beyond brands. Dance with Einstein. Start a family. Head to the Edge. Act Local, Go Global. Unleash Paradox. Read Shakespeare. Be an Inspirational Player. Make the World a Better Place.
Let’s start with why we are here – Business is the engine room of human progress. We build windmills in hurricanes. Nothing less. So if you want to change the world, stay seated.
Edward Tuck wanted to address the larger meaning of business. What then is the role of business? To make money? To grow shareholder value? To pay off your scorching tuition fees?
The role of business is to make the world a better place for everyone. For 6.4 billion people. Not one less.
It is business that plans, connects, and dreams the global flow of goods, ideas and experiences.
It is business that leads innovation and creates jobs, choices, opportunities and, critically, self-esteem.
It is business that holds the power to turn billions of human lives around.
Here are 10 ideas to cut through the information avalanche. Keep them close. They’ll take you to the summit of commerce.
Idea #1: Think with your Heart
Reason is important. It is also an incremental proposition. Look back. The eighties took reason to ridiculous new heights. Endless restructuring, re-engineering, de-layering, delocalizing, centralizing, working smarter and slowly disappearing up our own rectums in a vortex of cost savings, bottom line growth and top line starvation.
Then in the nineties a savior – technology, e-everything, networking us all to perfection. Then dot com dot gone. Telecom bomb. Enron boom and thud.
From nano to network, the resurgence of technology is crucial. But what will count as digits connect lives are the timeless human fundamentals.
Science confirms that humans are powered by emotion, not by reason. It’s how we make decisions. Without emotion, rational thought slows and disintegrates. Our reason needs emotion to engage it.
With emotion, with passion, you can turn incremental into quantum. You get an action attraction.
Brain scientist Donald Calne sums up: “The essential difference between emotion and reason is that emotion leads to action, while reason leads to conclusions.” More emotion, more action.
Idea #2: Look Beyond Brands
I grew up working with brands. Mary Quant. Gillette. Procter & Gamble. Pepsi. For the last seven years Saatchi & Saatchi. It’s been a great ride. But brands have run out of juice. It’s over.
From products to trademarks, from trademarks to brands. Brands have been commodified. In the Truman Show of new reality, the snacks are crisp, cars start first time and beer is always ice-cold. If you’re not no.1 or no.2 now, you’re wallpaper. Before you know it, your number’s up.
At the same time there’s been a massive power surge from manufacturers thru retailers, to consumers. Life now is virtual reality. Consumers have instant sight, less time, more choices, greater expectations, deeper convictions, digital veto – and they can time travel. A moment of falseness or indifference and they’ll turn off. And they’ll tell all their friends when they do.
The stakes have gone through the roof. Hold on to your hats. We’re in a brave new world, the transformation of brands into Lovemarks.
I’ve written a book about it – Lovemarks: The Future Beyond Brands. A brand that’s not just irreplaceable.
Five years ago Saatchi & Saatchi gave up trying to own consumers. We decided consumers should own us. Lovemarks bring new language, with new tools, new simplicity, new measures, and new realism. They fundamentally transform how to connect with consumers.
Lovemarks inspire loyalty beyond reason.
Lovemarks are built on Love and Respect.
Lovemarks are owned by the people who love them and use them, not by companies.
We call these people inspirational consumers. They are the new company directors.
Why were Toyota Prius fans printing their own promotional leaflet for the car? Because people were stopping them on the street to find out more. To experience the next wave of consumer, go surfing at www.lovemarks.com. Nominate your Lovemark. Your passion!
Lovemarks are the charismatic brands that people get emotional about. You know them instantly whether you are in New York, Shanghai or Barcelona.
Harley Davidson, definitely. Suzuki? I don’t think so.
Apple iMac. Again. Sorry IBM
Bush and Kerry – You tell me!!!
Jim Stengel from P&G got it in one. Remove a brand and people buy a replacement. Take a Lovemark away and you’ve got a protest on your hands.
Idea #3: Dance with Einstein
The Love / Respect axis comes recommended by Einstein, who said “Everything should be made as simple as possible, but not simpler.” Here, in two strokes of a pen, is the world of value before you.
Start with Low Respect, Low Love. Standard commodities. Rubbish collection. Public Utilities. And yes, US airlines. Essential. Zero brand heat.
Low Respect, High Love. The Fad zone. Hero today. Zero tomorrow. Pink handbags, photo stickers, the South Beach Diet, Martha Stewart. 20th century shareholder capitalism… As Drucker said: “Profit isn’t the rationale of a business, just the test of its validity.”
High Respect, Low Love. This is where most major brands are stuck. Great product, solid service, effective distribution.
And all fixed on the “e-r” words. Brighter, stronger, faster… cheaper. Table-stakes all of them.
High Respect, High Love. The next frontier of business. Seductive attitude, irresistible appeal. Sustainable outcomes. Lovemarks.
Idea#4: Start a Family
The companies of tomorrow will be families, not sterile corporations. People now want to be part of and buy from something bigger than themselves. Why? Life is tougher, faster and googled. As Microsoft and Wal-Mart are finding out, if you’re not loving today you lose ground tomorrow.
The sun has set on the corporate day.
Enterprising families that share mystery, sensuality, and intimacy – the deep currents of human meaning – will endure.
Lovemarks are infused with mystery, sensuality and intimacy, three words outside every MBA syllabus.
Mystery to draw together stories, metaphors, dreams and symbols. The Toyota Prius runs on secrets and has four months back orders. If we know everything there is nothing to surprise and delight us.
Sensuality The five senses – sight, sound, smell, touch, taste – are portals to the emotions. 95% of human thought is not fully conscious. Most hasn’t been explored, let alone engaged. Enterprise has only brushed the human sensory canvas.
Mainstreaming of design will be huge. Hybrids will explode boundaries. Detail will build dynasties. Simple complexities like Jobs’ click wheel. Like No piece of paper can be folded more than 7 times. Like a duck’s quack doesn’t echo, and no one knows why!!
Intimacy. Knowing the consumer better than she knows herself. Empathy, commitment and passion. The small touch, the perfect gesture. The intimate connections that win undying loyalty.
Idea #5: Head to the Edge
Kurt Vonnegut got it right: “I want to stay as close to the edge as I can without going over. Out on the edge you see all kinds of things you can’t see from the center.”
Think competitive edge. Leading edge. Cutting edge. Edge of your seat. Edge of your Dreams.
Biology follows the edge rule. So does Malcolm Gladwell’s tipping point. Disruptive events are driven by a few dramatic changes at the margin, not at the core, where the population is sparse and unorthodox. The modern networked economy is no different. Biology explains the internet and exponential growth.
My home New Zealand is the on the edge of time. It’s a convergence of attitude, location, agility, risk-taking and velocity. For the New Zealand Edge, check out www.nzedge.com
The average price isn’t important. The marginal price is. The margins are where the action is.
Apple is edge on steroids. You can battle in commodity hell with Dell or soar on Loyalty Beyond Reason. Apple’s design-led premium strategy is emotion in motion.
Idea #6: Act Local Go Global
The local / global debate is like Friends, a comic soap opera. ‘Should I be thinking local?’ ‘Should I be acting global?’ ‘Should I be thinking global and local?’… ‘Should I be glocal?’, and so on. And I see there’s a new episode from Harvard’s John Quelch and Oxford’s Doug Holt in September HBR.
Since I’m CEO in residence at Cambridge, which kicks Oxford’s ivy butt, let me put you out of your misery. Thinking smart is table stakes. You’ve got to be acting and going, not hung up on thinking. Again, the key is action. You can think like IBM or just do it like Nike. The competitive advantage is deep in the local. Because believe it, there is no such thing as a global consumer. I’ve never met one. If anyone here has, please see me after!! We are all local. We define ourselves by our differences.
Figure out your equity platform. Drip it with mystery, sensuality and intimacy. Pump it into a local situation. Lock down what turns consumers on. Return learnings to centre at light speed, accelerate into the next local market, connect and cook. Lovemarks take the essence of the local and light up a path to the global. At meteoric speed.
Idea #7: Unleash Paradox
Every company faces counterpoints. Last century, business adopted either/or as a way through. Make a choice. Make another based on it. Exclude all options that don’t fit. Old or New Economy. Micro or Macro. Reason or Emotion. Present or Future.
Saatchi & Saatchi rattled the cage and moved on to And / And. Emotion and Reason. Present and Future. Love and Respect. We’ve even developed emotional metrics. It’s wild but true, we can measure love.
But even and/and has its demons. To do justice to each meant a trade off. A compromise to optimize.
To win, you have to explode through paradox. Work with two competing ideas at the same time. Instead of the best of neither, you get something better than both. Toyota does it best.
How? Through the mysterious art of Kaizen.
Work two opposing concepts in all their complexity with equal passion. Refuse to make a choice between two directions, instead go for maximum effect in both. At Toyota there is no best, only better:
- Toyota embraces both the Japanese management style and the American management style. Toyota has refused to compromise on either.
- Toyota embraces the long and short-term. A clear vision for 2020, and passionately focused on daily sales. They sweat the details and drive the big picture.
- Toyota embraces continuous innovation and cost reduction – a new model is faster, roomier, more powerful, lighter, more fuel efficient, has more features, delivers a higher margin to the dealer- and is cheaper for the customer.
- Toyota is relentlessly competitive and invites other companies into the factory to see their legendary production systems knowing that they won’t be able to replicate what they see.
The results are scary. Earnings greater than those of General Motors, Ford and DaimlerChrysler combined. The Power of Paradox. A Toyota secret.
Idea #8: Read Shakespeare
Samuel Beckett described Shakespeare as the mirror of life. You don’t read King Lear, it reads you. Language is a power, and that power lives in imagery. Look at the word “Elephant.” It’s impossible not to see the saggy, grey bulk in your mind’s eye.
Language will shape your fortune. Because the greatest innovations are born in its vision. It is the minds eye that finds the human heart.
Endorsing Lovemarks, Alan Webber, Founding Editor of Fast Company observed that if you describe something accurately and beautifully you don’t just create a marketable product. You fundamentally change the conversation. People reframe the way they think and talk to each other. You build new business models. You create entire new categories.
Think Howard Schultz and his 8000 store chain. It wasn’t a coffee joint he dreamed of. It was a third home. A whole new world opened. First a wireless network. Next its music. What the hell next?
Idea #9: Be an Inspirational Player
I love Tuck’s focus on inspirational leadership. Business success today is about more than management, doing things right. About more than leadership, doing the right things. It is about connecting through love and inspiration. And make no mistake, it takes courage to accept this challenge.
I’m not in my job to lead. Or to manage. My role as CEO of Saatchi & Saatchi is to inspire my people. To make sure the stuff our people cram into their heads doesn’t muffle the sound of their hearts. We run on inspiration. We build our creative people an elastic-sided sandbox, pose them a simple killer problem, give them zero time to solve it, and get the hell out of their way!
To make our team you need be passionate, competitive and restless. To advance you have to inspire the hell out of your people. Show them that you love them and their ideas, and you’ll support them no matter what.
Inspiration arouses people’s long-term commitment to exceed personal best. Not performance measures, not the competition. Personal best. With academic colleagues I developed this into an organizational change model called Peak Performance.
Peak Performance outstrips the legions of military management models and metaphors that bore students to tears. And that have been done to death around the world. Reengineering, rightsizing, upsizing, downsizing, atomizing, restructuring and on it goes. Today efficiency and effectiveness are table stakes. Inspiration driven through emotion is what drives explosive growth.
Peak Performance is a book, a theory, a hard-edged practice. We use it to accelerate some of the world’s most admired organizations. From Toyota and Visa to General Mills and Procter & Gamble, where I cut my teeth.
What is Peak Performance? In short, an Inspirational Dream to make the world a better place. Martin Luther King didn’t say I have a business plan right? And it’s a challenge, focus and family of inspired people working in flow and harmony, with passion and fun, to bring the dream to life.
The programme has been a catalyst for transformation at P&G. When our PPO team started workshops at P&G in 2000, the share price was at $52. Morale had hit the floor. We focused on building a lovable Purpose. We re-imagined the authentic bedrock of P&G: Touching Lives, Improving Life. The share price doubled.
Idea #10: Make the World a Better Place
Which brings us full circle… I don’t see a clear line between business and life – and I sure can’t get them to balance. I do know that ROI stands for return on Involvement. We’re entering a fragile Age where sustainability makes perfect business sense. Tomorrow’s companies will have incredible values, big dreams and relentless performance ethics.
There are four non-negotiable profit lines:
- Create a Winning Zone. Economic sustainability.
- Protect Planet Home. Environmental sustainability.
- Build a Family of One. Social sustainability.
- Nurture a World for Many. Cultural sustainability.
I’m a Professor of Sustainable Enterprise at universities in Ireland and New Zealand. I throw every CEO a sustainability cruncher. Would you like consumers to respect your brand and company or to love and respect them? The answer is always the same.
Lovemarks is sustainable enterprise made real. And Peak Performance, the drive towards an inclusive tipping point, is what takes you there.
The view from here makes the hair on my neck stand up. I see bright futures out there. I want to leave with you with three calls to action.
- Pursue Failure. Avoid moderation. Be hot, or cold, but not lukewarm. I’ve always ignored warnings against enthusiasm. Fear and caution strangle ideas. As Ice Hockey superstar Wayne Gretzky once said “you miss 100 per cent of the shots you don’t take”!! So be in over your head. Don’t be afraid to lose because then – and only then – will you know what you’re made of. You discover your limits when you crash up against them. When you experience failure you bounce back harder and smarter. Just remember, a genius is a person who makes the same mistake. Once!
- Fall in love with ideas. Knowledge is a table stake. Idea make stuff happen. Act like a technician or expert and that is how you will be treated. Act like an ideas person and the world will open up before you. I work with ideas and ideas people all the time. Saatchi & Saatchi is global but we don’t play the usual global game. Marathon manuals and meetings. Endless consultation. Bloody nightmares. Instead we focus on the ideas that make a difference.
In my business great ideas are killed every day by market researchers. I call them the research vampires. For all their percentage point certainty, they are still baffled by emotion. Trying to work out what consumers want through better data gathering, tighter segmentation, sharper data mining adds up to more analysis, not better understanding. The vampires can track brain waves but not big ideas or deep emotion, because they don’t have them. Usually.
- Follow your heart. Feel it, don’t just analyze it. Scary? Sure, but that’s the way to make the best decisions. When my head bullied my heart I’ve made mistakes.
In all things you do, stay open to love. Once you accept the power of Love a whole heap of stuff drops neatly into place – or right out of the picture altogether.