Reputation to Revenue

Cisco's big think approach to emerging markets

For years, technology companies have tried to move up the value chain by promoting big ideas that would drive sales of premium business solutions rather than commodity products and services. It certainly makes sense, and some firms do it pretty well, but it's easier said than done.

Cisco, according to BusinessWeek, is now trying to move WAY up the value chain, looking to design whole cities, among other "projects" in emerging markets such as Saudi Arabia, Brazil, and Chile.

"Cisco isn't just selling technology. [SVP Paul] Mountford's pitch is that Cisco, more than any other company, can help countries such as Saudi Arabia modernize their economies and become leaders in the Internet Age. The company argues that, by investing in the Internet infrastructure Cisco sells, these governments can better educate their citizens, improve health care, and boost national productivity. They may even be able to create their own tech sectors, giving citizens the opportunity to become  well-paid 'knowledge workers like those in Bangalore or Guangdong, China."

The effort, as tech marketing guru Geoffrey Moore explains, "is getting itself designed into the fabric of these countries' economic plans, because Cisco is helping their leaders imagine the future." 

Pretty ambitious, to say the least. And extremely challenging, as BusinessWeek also notes, given the economic slowdown, intense competition from Cisco rivals, and the tremendous internal demands it places on Cisco's own experts to actually live up to the hype and deliver the goods.

But I think the time is right. For one thing, industry leaders like Cisco need to be bold in finding new markets to maintain their momentum. For another, as I wrote recently about IBM's Smarter Planet initiative, attaching ourselves in an authentic way to causes larger than ourselves (or companies) may well be the most effective way to go to market in this time of great change.

What do you think?

SAP's sustainability site: Will they come?

Business software giant SAP launched an online collaboration site last week to promote dialogue with stakeholders on a range of social, economic, and environmental concerns. The site sits on SAP's new collaboration workspace platform, which enables registered users to post content, communicate with SAP officials and each other, and set up public and private workspaces. 

To get the dialogue going, SAP's vice president of corporate citizenship, James Farrar, has launched a new blog, a stakeholder survey, and, most important, the company's first global report on sustainability.

It's a great idea, and it plays directly to the mission-oriented marketing I wrote about with IBM recently. As noted by Sustainable Life Media, it follows similar efforts by companies including Cadbury and IKEA Canada. 

SAP has a good story to tell on sustainability, and the report does a nice job of telling it. Befitting the company's role as a leading software provider, the report has a dual focus, covering both SAP's internal responsibilities to operate in a sound, ethical, and environmentally responsible manner, and external opportunities and obligations to provide solutions that help clients operate in a similar fashion. 

Even more, providing a real platform for collaboration gives credence to Farrar's claim that SAP sees its sustainability report (itself an important step) as simply the beginning of an ongoing dialogue with stakeholders.

The question now is will they come. Nine days after the launch, the site is pretty thin. One blog post, two documents, and just a few outside comments. The sustainability report has received a number of views, but the dialogue has yet to really begin. 

It's a common problem, of course. You can't just build it and hope they will come. Clearly SAP put enormous effort into creating its first sustainability report and building the collaboration space. The challenge now is to put similar energy into generating interest and traffic to the site, and lively interaction once people get there.

Nice marketing touch from Plow & Hearth

I ordered some fatwood kindling for my wood stove last night from Plow & Hearth, and wanted to pass along a nice touch from the end of the transaction. 

With my purchase, the company commits to planting several trees as part of its Campaign to Reforest America, in partnership with the National Forest Foundation. It's a good cause, and pretty easy and relatively inexpensive to do. Lots of companies do similar things; the rest probably should. 

But the execution is actually what made me pause: A nice separate email (in addition to my purchase confirmation), a simple vote so I could pick which of three national forests to support, and links to additional information about the campaign, the partnership, the specific forests, and the issues at stake. It was nothing earth-shattering, but a good reminder that a few extra touches can go a long way toward making your customers feel better about you.

Supporting the environment is good; doing it with engaging and educational content is even better.

Deloitte says CSR and green can boost M&A value

Many discussions about the business value of corporate social responsibility and "going green" highlight benefits such as brand distinction, customer loyalty, and employee morale -- and, increasingly, potential cost savings. A new white paper from Deloitte adds deal value in mergers and acquisitions to the list.

According to the authors, "companies that have strong corporate responsibility and sustainability (CR&S) programs in place are likely to be rewarded for their efforts. Those that don’t have such programs can expect to face increasing regulatory and marketplace demands for change."

The trend is driven by increasingly tight environmental regulations as well as broader trends toward greater transparency and accountability around potential social and financial risk. Energy companies are obviously front and center here, but the trend affects many industries, according to Deloitte, including manufacturing, transportation, and retail.

As CR&S wields growing influence on the strategy and operations of companies, so will it become an increasingly important aspect of M&A. Acquiring companies will want to know whether they are taking on sustainability problems or opportunities. Divesting organizations will want to know whether their sustainability profile will contribute to a premium or discount price.

Looking ahead, the Deloitte authors provide several useful suggestions for executives looking to buy or sell:

• Know your own backyard: Understand how well your organization is addressing sustainability issues
• Begin to incorporate CR&S metrics, goals, and targets into the deal valuation process
• Consider the potential economic impact of changes on consumer preferences, legislative changes, significant variations in energy prices and other supplier prices
• Plan for evolving regulatory conditions
• Engage in a formal alternative future/risk assessment scenario planning exercise
• Consider the people aspects

 

IBM, Obama, and marketing with a mission

Sam Palmisano, IBM's CEO, went to the Council on Foreign Relations this morning to lay out an ambitious program of technology-driven social change and economic recovery. IBM's "Smarter Planet" initiative is a seriously big idea; in Palmisano's words, it's about "infusing intelligence into the way the world literally works—the systems and processes that enable physical goods to be developed, manufactured, bought and sold… services to be delivered… everything from people and money to oil, water and electrons to move… and billions of people to work and live."

Practically speaking, this means investing heavily in technology-based systems and processes to address fundamental global challenges such as energy waste, transportation gridlock, supply chain inefficiency, water shortages, antiquated health care systems, and, perhaps most urgent right now, unmonitored and out of control financial markets.

The initiative is of course self-serving. The more governments invest in technology-based solutions, the more industry leaders like IBM stand to gain. But self-serving doesn't mean it's wrong. In fact, I'd like to suggest that this is actually the best kind of marketing, and the kind that we need to be emphasizing right now:

• It's mission-driven, focused on applying business know-how to clearly felt social problems
• It's inspirational, inviting people to think big
• It's provocative, challenging people to debate the premise, the approach, and potential alternatives
• It's solution-oriented, looking more toward designing sophisticated solutions than pitching specific products or services
• It's believable, because IBM has done the research, is already investing heavily in green technology and services, and has credible offers and capabilities to address at least some of the problems.

My main point here is not to praise IBM, although obviously I do think the effort is praiseworthy. IBM is far from a perfect company and other firms are doing similarly valuable work in these areas. Rather, it's to raise the question about how we go to market in this difficult time.

Most of the marketers I talk to these days are shortening their time horizons, shifting resources (to the extent they still have them) toward lead generation, and doing whatever possible to accelerate immediate sales. This is understandable, and yet...

We've just completed a remarkable election in the US in which a majority of Americans chose a candidate who stared calmly at enormous problems facing our country and the world and said now is the time to think big, to set our sights high, and to be the change. Self-serving? Of course. But it also excited and inspired and mobilized millions of people previously too cynical or disengaged to actually believe that getting involved could make a difference.

Marketing candidates is clearly different than marketing business services and solutions. But exciting and inspiring cynical and disengaged people is actually a pretty good description of the challenge we business marketers are facing right now too.

Palmisano summed it up nicely this morning: "Over the next couple of years, there will be winners, and there will be losers. And though it may not be easy to see now, I believe we will see new leaders emerge who win not by surviving the storm, but by changing the game."