Management – Page 20 – artdiamondblog.com

Yahoo Valued “Marketing Gimmicks” More than Search Speed

(p. 44) Google had struck a deal to handle all the search traffic of Yahoo, one of the biggest portals on the web.
The deal–announced on June 26, 2000–was a frustrating development to the head of Yahoo’s search team, Udi Manber. He had been arguing that Yahoo should develop its own search product (at the time, it was licensing technology from Inktomi), but his bosses weren’t interested. Yahoo’s executives, led by a VC-approved CEO named Timothy Koogle (described in a BusinessWeek cover story as “The Grown-up Voice of Reason at Yahoo”), instead were devoting their attention to branding–marketing gimmicks such as putting the purple corporate logo on the Zamboni machine that swept the ice between periods of San Jose Sharks hockey games. “I had six people working on my search team,” Manber said. “I couldn’t get the seventh. This was a company that had thousands of people. I could not get the seventh.” Since Yahoo wasn’t going to develop its own search, Manber had the task of finding the best one to license.

Source:
Levy, Steven. In the Plex: How Google Thinks, Works, and Shapes Our Lives. New York: Simon & Schuster, 2011.
(Note: italics in original.)

Excite Rejected Google Because It Was too Good

(p. 28) Maybe the closest Page and Brin came to a deal was with Excite, a search-based company that had begun– just like Yahoo– with a bunch of sharp Stanford kids whose company was called Architext before the venture capitalists (VCs) got their hands on it and degeekified the name. Terry Winograd, Sergey’s adviser, accompanied them to a meeting with Vinod Khosla, the venture capitalist who had funded Excite.
. . .
(p. 29) Khosla made a tentative counteroffer of $ 750,000 total. But the deal never happened. Hassan recalls a key meeting that might have sunk it. Though Excite had been started by a group of Stanford geeks very much like Larry and Sergey, its venture capital funders had demanded they hire “adult supervision,” the condescending term used when brainy geeks are pushed aside as top executives and replaced by someone more experienced and mature, someone who could wear a suit without looking as though he were attending his Bar Mitzvah. The new CEO was George Bell, a former Times Mirror magazine executive. Years later, Hassan would still laugh when he described the meeting between the BackRub team and Bell. When the team got to Bell’s office, it fired up BackRub in one window and Excite in the other for a bake-off.
The first query they tested was “Internet.” According to Hassan, Excite’s first results were Chinese web pages where the English word “Internet” stood out among a jumble of Chinese characters. Then the team typed “Internet” into BackRub. The first two results delivered pages that told you how to use browsers. It was exactly the kind of helpful result that would most likely satisfy someone who made the query.
Bell was visibly upset. The Stanford product was too good. If Excite were to host a search engine that instantly gave people information they sought, he explained, the users would leave the site instantly. Since his ad revenue came from people staying on the site–” stickiness” was the most desired metric in websites at the time– using BackRub’s technology would be (p. 30) counterproductive. “He told us he wanted Excite’s search engine to be 80 percent as good as the other search engines,” says Hassan. And we were like, “Wow, these guys don’t know what they’re talking about.”
Hassan says that he urged Larry and Sergey right then, in early 1997, to leave Stanford and start a company. “Everybody else was doing it,” he says. “I saw Hotmail and Netscape doing really well. Money was flowing into the Valley. So I said to them, ‘The search engine is the idea. We should do this.’ They didn’t think so. Larry and Sergey were both very adamant that they could build this search engine at Stanford.”
“We weren’t … in an entrepreneurial frame of mind back then,” Sergey later said.

Source:
Levy, Steven. In the Plex: How Google Thinks, Works, and Shapes Our Lives. New York: Simon & Schuster, 2011.
(Note: ellipsis between paragraphs added; ellipsis in last sentence, in original.)

“No Innovation Happens with 10 People in a Room”

“Paul English, the co-founder of Kayak, said the company valued testing new ideas, not talking about them.” Source of caption and photo: online version of the NYT article quoted and cited below.

(p. B2) Q. You were a co-founder of Kayak nine years ago. What’s unusual about the culture?

A. We’re a little bit reckless in our decision-making — not with the business, but the point is that we try things. We give even junior people scary amounts of power to come up with ideas and implement them. We had an intern last summer who, on his very first day at Kayak, came up with an idea, wrote the code and released it. It may or may not have been successful, but it almost doesn’t matter, because it showed that we value speed, and we value testing ideas, not talking about them.
. . .
Q. What else?
A. We’re known for having very small meetings, usually three people. There’s a little clicker for counting people that hangs on the main conference room door. The reason it’s there is to send a message to people that I care about this issue. If there’s a bunch of people in the room, I’ll stick my head in and say, “It takes 10 of you to decide this? There aren’t three of you smart enough to do this?”
I just hate design by consensus. No innovation happens with 10 people in a room. It’s very easy to be a critic and say why something won’t work. I don’t want that because new ideas are like these little precious things that can die very easily. Two or three people will nurture it, and make it stronger, give it a chance to see life.

For the full interview, see:
ADAM BRYANT, interviewer. “CORNER OFFICE; Paul English; Ten People in a Meeting Is About Seven Too Many.” The New York Times (Fri., July 26, 2013): B2.
(Note: ellipsis added; bold and italics in original.)
(Note: the online version of the interview has the date July 25, 2013, and has the title “CORNER OFFICE; Paul English of Kayak, on Nurturing New Ideas.”)

Will Apple Innovate Without Jobs?

“Steve Jobs, introducing the iPhone 4 in January [2011].” Source of caption and photo: online version of the NYT article quoted and cited below.

(p. B4) “The good news for Apple is that the product road map in this industry is pretty much in place two and three years out,” said David B. Yoffie, a professor at the Harvard Business School. “So 80 percent to 90 percent of what would happen in that time would be the same, even without Steve.”

“The real challenge for Apple,” Mr. Yoffie continued, “will be what happens beyond that road map. Apple is going to need a new leader with a new way of recreating and managing the business in the future.”
. . .
His design decisions, Mr. Jobs explained, were shaped by his understanding of both technology and popular culture. His own study and intuition, not focus groups, were his guide. When a reporter asked what market research went into the iPad, Mr. Jobs replied: “None. It’s not the consumers’ job to know what they want.”
. . .
Great products, Mr. Jobs once explained, were a triumph of taste, of “trying to expose yourself to the best things humans have done and then trying to bring those things into what you are doing.”
Mr. Yoffie said Mr. Jobs “had a unique combination of visionary creativity and decisiveness,” adding: “No one will replace him.”

For the full story, see:
STEVE LOHR. “Without Its Master of Design, Apple Will Face Challenges.” The New York Times (Thurs., August 25, 2011): B1 & B4.
(Note: ellipses in text, and bracketed year in caption, added.)
(Note: the online version of the story has the date August 24, 2011, and the slightly longer title “Without Its Master of Design, Apple Will Face Many Challenges.”)

Larry Page Makes an O.K. Decision Now, Rather than a Perfect Decision Later

“Larry Page has pushed for quicker decision-making and jettisoned more than 25 projects that were not up to snuff.” Source of caption and photo: online version of the NYT article quoted and cited below.

(p. A1) MOUNTAIN VIEW, Calif. — Larry Page, Google’s chief executive, so hates wasting time at meetings that he once dumped his secretary to avoid being scheduled for them. He does not much like e-mail either — even his own Gmail — saying the tedious back-and-forth takes too long to solve problems.
. . .
(p. A3) Borrowing from the playbooks of executives like Steven P. Jobs and Mayor Michael R. Bloomberg, he has put his personal imprint on the corporate culture, from discouraging excessive use of e-mail to embracing quick, unilateral decision-making — by him, if need be.
“Ever since taking over as C.E.O., I have focused much of my energy on increasing Google’s velocity and execution, and we’re beginning to see results,” Mr. Page, 38, told analysts recently.
. . .
Despite the many external pressures on Google, it is dominant in its business and highly profitable. But, when asked at a recent conference about the biggest threat to his company, Mr. Page answered in one word, “Google.”
The problem was that the company had ballooned so quickly — it now has more than 31,000 employees and $27.3 billion in revenue so far this year — that it had become sclerotic. A triumvirate of Mr. Page, his co-founder, Sergey Brin, and Eric E. Schmidt, Google’s former chief and current chairman, had to agree before anything could be done. The unwieldy management and glacial pace of decision-making were particularly noticeable in the Valley, where start-ups overtake behemoths in months.
It is different now.
“It’s much more of a style like Steve Jobs than the three-headed monster that Google was,” said a former Google executive who has spoken with current executives about the changes and spoke anonymously to preserve business relationships. “When Eric was there, you’d walk into a product meeting or a senior staff meeting, and everyone got to weigh in on every decision. Larry is much more willing to make an O.K. decision and make it now, rather than a perfect decision later.”

For the full story, see:
CLAIRE CAIN MILLER. “Google’s Chief Works to Trim a Bloated Ship.” The New York Times (Thurs., November 10, 2011): A1 & A3.
(Note: ellipses added.)
(Note: the online version of the story has the date November 9, 2011.)

Cuban Government Employees “Are Known for Surly Service, Inefficiency, Absenteeism and Pilfering”

(p. A10) However small, . . . , the private sector is changing the work culture on an island where state employees earn meager salaries and are known for surly service, inefficiency, absenteeism and pilfering.
Sergio Alba Marín, who for years managed the restaurants of a state-owned hotel and now owns a popular fast-food restaurant, said he was very strict with his employees and would not employ workers trained by the state.
“They have too many vices — stealing, for one,” said Mr. Alba, who was marching with his 25 employees and two large banners emblazoned with the name of his restaurant, La Pachanga. “You can’t change that mentality.”
“Even if you could, I don’t have time,” he added. “I have a business to run.”

For the full story, see:
VICTORIA BURNETT. “HAVANA JOURNAL; Amid Fealty to Socialism, a Nod to Capitalism.” The New York Times (Thurs., May 2, 2013): A6 & A10.
(Note: ellipsis added.)
(Note: the online version of the story has the date May 1, 2013.)

Academia Rejected Maslow’s Humanistic Psychology

Source of book image: http://www.harpercollins.com/harperimages/isbn/large/9/9780061834769.jpg

(p. 23) Abraham Maslow, humanistic psychology’s founding father, rejected the atomistic approaches of psychoanalysis and behaviorism that dominated the first half of the 20th century. He strove to develop a psychology that provided “a fuller, though still scientific, treatment of the individual” and understood the potential for growth as innate. His ideas got their most welcome reception from industrial management, to which Maslow retreated when academia failed to roll out the red carpet. But Grogan eloquently insists that humanistic psychology subtly revolutionized Americans’ conception of the self and the role of therapy, and asserts that current trends in the field, like positive psychology, owe the theory a debt they have been reluctant to pay.

For the full review, see:
MEGAN BUSKEY. “Nonfiction Chronicle.” The New York Times Book Review (Sun., March 31, 2013): 23.
(Note: the online version of the review has the date March 29, 2013.)

The book under review:
Grogan, Jessica. Encountering America: Humanistic Psychology, Sixties Culture, and the Shaping of the Modern Self. New York: Harper Perennial, 2012.

“The Ante for Being in the Room” at Apple Was Brutal Honesty

The following passage is Steve Jobs speaking, as quoted by Walter Isaacson.

(p. 569) I don’t think I run roughshod over people, but if something sucks, I tell people to their face. It’s my job to be honest. I know what I’m talking about, and I usually turn out to be right. That’s the culture I tried to create. We are brutally honest with each other, and anyone can tell me they think I am full of shit and I can tell them the same. And we’ve had some rip-roaring arguments, where we are yelling at each other, and it’s some of the best times I’ve ever had. I feel totally comfortable saying “Ron, that store looks like shit” in front of everyone else. Or I might say “God, we really fucked up the engineering on this” in front of the person that’s responsible. That’s the ante for being in the room: You’ve got to be able to be super honest. Maybe there’s a better way, a gentlemen’s club where we all wear ties and speak in this Brahmin language and velvet codewords, but I don’t know that way, because I am middle class from California.

I was hard on people sometimes, probably harder than I needed to be. I remember the time when Reed was six years old, coming home, and I had just fired somebody that day, and I imagined what it was like (p. 570) for that person to tell his family and his young son that he had lost his job. It 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.

Source:
Isaacson, Walter. Steve Jobs. New York: Simon & Schuster, 2011.

Real Entrepreneurs Do Not Launch a Startup in Order to Cash In and Move On

The following passage is Steve Jobs speaking, as quoted by Walter Isaacson.
I agree with the part about real entrepreneurs not going public quick in order to cash in. But I disagree that the real entrepreneurs are mainly interested in building a lasting company. I think that often they are mainly interested in getting a project, or a series of projects, done (and done reasonably well). Recall that when Walt Disney couldn’t convince Roy Disney to pursue the Disneyland project, Walt left the main Disney company to pursue the project through a secondary rump Disney company.

(p. 569) 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. You build a company that will still stand for something a generation or two from now. That’s what Walt Disney did, and Hewlett and Packard, and the people who built Intel. They created a company to last, not just to make money. That’s what I want Apple to be.

Source:
Isaacson, Walter. Steve Jobs. New York: Simon & Schuster, 2011.

Jobs Believed Great Companies Decline When Salesmen (Rather than Engineers and Designers) Take Over

The following passage is Steve Jobs speaking, as quoted by Walter Isaacson.

(p. 568) I have my own theory about why decline happens at companies like IBM or Microsoft. The company does a great job, innovates and becomes a monopoly or close to it in some field, and then the quality of (p. 569) the product becomes less important. The company starts valuing the great salesmen, because they’re the ones who can move the needle on revenues, not the product engineers and designers. So the salespeople end up running the company. John Akers at IBM was a smart, eloquent, fantastic salesperson, but he didn’t know anything about product. The same thing happened at Xerox. When the sales guys run the company, the product guys don’t matter so much, and a lot of them just turn off.

Source:
Isaacson, Walter. Steve Jobs. New York: Simon & Schuster, 2011.

Steve Jobs: “Never Rely on Market Research”

The following passage is Steve Jobs speaking, as quoted by Walter Isaacson.

(p. 567) 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’s why I never rely on market research. Our task is to read things that are not yet on the page.

Source:
Isaacson, Walter. Steve Jobs. New York: Simon & Schuster, 2011.