Tuesday, March 24, 2009

If the sky is NOT falling, what does that do for "projected" earnings? . . . and more about the printernet

The Printernet is a facilitated user network that lives in real time
Search for it, find it, assemble it, print it. Anywhere in any form at any time.
The public business discourse seems to be taking a turn for the better. It seems that "Wall Street" is "happier." Blablabla. The real story is that everyone is getting a little more realistic. Meanwhile, Black Rock says they are eager to buy "toxic assets" at the right combination of risk and price.

Ever since the big investment banks figured out they were deeply screwed, it's been never ending blablabla about the end of days. It shouldn't be a surprise since the public discourse has been trapped in an "end of days" narrative for the last eight years. Plus "end of days" stories are the easiest stories to tell for talking heads, pundits and politicians.

Most of the folks at the tops of the various pyramids are still trapped in yesterday's story. What they are missing is that the grown-ups are back in charge. What will work is what always has worked. Get the best people you can find, put them in a team where the boss has a clear reality based vision. Make sure they understand what they have to do. Get them the resources they need. Don't pay too much attention to the blablabla.

If people don't know what to do, they revert to doing what they know. But if the incentives and the definitions are clear and aligned, people will do their jobs. If everyone just does their job, things usually work out fine. If you are in government, the job is to protect the population and nurture sustainable growth. If you are running a business, the job is to earn money. If you are running a school, the job is to educate everyone.

Meanwhile, everyone on the planet has the job of living a good life. That means earning a living that keeps you, your family and your community safe and hopeful about the future.

The power of stories
Children make up stories. They take great pleasure in retelling the same stories again and again. It's how they learn to make sense of the world. Grown ups make up their own stories. Its also how they make sense of the world. Scientists make up their stories, but then focus on figuring out what parts of the story is wrong. And how does their story fit into the others already out there. It's a proven method to get to a story that better predicts the future. "Projected earnings?"

In that spirit, here's my story.

"Profit projections" like "market size" are about predicting the future. As Yogi Berra reportedly said, "It's hard to make predictions, especially about the future." But public corporations are supposed to predict the future every quarter. If they guess right, "Wall Street" is "happy". If they guess wrong, "Wall Street" is "unhappy." What's lost in the blablabla is that "Wall Street" is just a sound bite. In a world of global capital moving through the wire, "Wall Street" is not a place. It is a window on money that opens at 9:30 and closes at 4:30 EST. "Wall Street" "feeling" hopeful, worried or anything else is just a blablabla story that is easy to tell.

Google does not make predictions or "give guidance." They just keep on keeping on. Google-as-business has a single minded focus on making it better, faster and cheaper for more and more people to sell and see advertising. Google-as-place to work is optimized to be an innovation machine. Apple-as-business sells hardware. Apple-as-place to work is also an innovation machine. They have organized themselves to ride the wave of what Clay Christensen calls the facilitated user network commercial model.

The next stage of the printing, imaging, information business is moving to the same model. Some organizations will make the transition. Others will be the Lehman Brothers of the Print Industry. Business organizations come and go. The real economy just keeps on keeping on.

Time is a deep fundamental
Most profit projections have an unspoken assumption. "Assuming that our business is organized the way it has been organized in the recent past". If you are trapped in the bubble at the top of the pyramid, you live in corporate time. Now that the information advantage of large corporations is disappearing, you have to make the transition to real time.

Real time is not measured quarter to quarter. Real time is measured by a continuous flow of events that either quickly follow one another or, most often, happen simultaneously. The time in a value chain commercial model is different from the time in a facilitated user network commercial model.

Independent business and sales people live in real time. That is their competitive advantage. It's why a small team in Germany invented Wiki to PDF and is already monetizing it by selling books. it's why the independent businesses that are having a conference on MPS are winning contracts today. It's why the real innovations in Print are happening in the print shops on the ground.

Meanwhile erasable paper is announced but still lost somewhere in the pipeline, and Screen will be in the market "soon."

Google and WalMart typically don't make announcements about what they are going to do. They run experiments to see what works and what sucks. Then the improve what works and fix what sucks. Then they keep doing it until it's ready to scale. Meanwhile their radar screen is always searching for those simultaneous events that will give them a clue as to what to do next.

Facilitated user networks is a commercial model for Print
Salesforce.com didn't announce what they were going to do. They just kept on keeping on. After 10 years, they are up to $1 billion in revenue. Craig's List has a full time staff of about 17. They generated $100,000,000 in revenue. Google Apps is continuing it's penetration to the middle of the pyramid. Alphagraphics doesn't announce what they are going to do, but a copy shop was chosen as the site to produce newspapers on Demand on Screen machines for a UK based newspaper.

to be continued . . . .

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