Through the continued development of the Amazon Kindle app for the iPad, it was a lot easier figuring out the best non-fiction books for 2011.  With the capability of highlights and notes going to the Amazon cloud and Amazon tracking how many highlights and notes there are for each book, it was easy to see which books really captured my attention.

Each of the books that made the list had other key attributes:

• The book had to have some framework or process that affected how I consult, mentor or teach
• The book had to stimulate emails to colleagues to recommend that they read and then enter into a discussion about the merits of the book
• The book had to have the potential for making my most recommended book list.

For a book to rank high on the list, it had to have a high number of highlights and notes and have more of the top three attributes.

While most of the books were published in 2011, there were a couple that were published earlier that I needed to re-read as part of selecting the book for my graduate courses.  I enjoy the many new insights from a good book the second or third time around.  Much like the philosophical question “can you step into the same river twice?“, no non-fiction book is ever the same the second time around.

Top 10 Non-Fiction Books I Read or Re-Read in 2011

1. Demand: Creating What People Love Before They Know They Want It by Adrian Slywotzky and Karl Weber.
2. Now You See It: How the Brain Science of Attention Will Transform the Way We Live, Work and Learn by Cathy Davidson
3. The Nature of Technology: What It Is and How It Evolves by W. Brian Arthur
4. The Filter Bubble: What the Internet is Hiding from You by Eli Pariser
5. Visual Complexity: Mapping Patterns of Information by Manuel Lima
6. The Accidental Creative: How to be Brilliant at a Moment’s Notice by Todd Henry
7. What I Didn’t Learn in Business School:  How Strategy Works in the Real World by Jay Barney and Trish Gorman Clifford
8. Boomerang: Travels in the New Third World by Michael Lewis
9. Living with Complexity by Donald Norman
10. Agency Mania: Harnessing the Madness of Client/Agency Relationships for High-impact Results by Bruno Gralpois

Demand: Creating What People Love Before They Know They Want It

Adrian Slywotzky is one of my favorite business authors writing several books on profitability and profit patterns.  With this book, he ventures beyond pure business models to explore the arenas of design and user experience as key differentiators for product with extraordinary demand.

For a business professor, consultant, and prolific writer about business, this book explores the critical role of user research in all phases of his six pillars of creating demand.  Slywotzky describes demand as:

“Demand creators spend all of their time trying to understand people. . . By watching how people actually behave in their own worlds, and by talking to them constantly, demand creators figure out how to solve the big and little hassles we all face—and they make our days easier, more convenient, more productive, and simply more fun. They seem to know what we want even before we do. They wind up creating things people can’t resist and competitors can’t copy.

“Yet they almost never succeed on the first try. They know that real demand comes from connecting the dots between the human factors and a quirky, ever-shifting combination of other elements: financial and emotional costs, social norms, infrastructure, product design, patterns of communication, and many more. It comes from understanding how all these factors interact in complex, unpredictable, and counterintuitive ways. And it comes from a way of thinking that makes the leap from trying to convince people to buy something to human understanding, to seeing the world through the eyes and emotions of the customer. A dozen cylinders have to click into place before the vault door swings open. But when it does, wonderful things happen—for all of us.”

Sound familiar.  This description is the world of human centered design partially described in a previous post.  Human centered design has the four stages of user research, prototypes, value (viability and human values), and user experience.  Slywotzky in his own words and through his own research has incorporated all of these processes in his six steps that all great demand creators follow:

1. Make it magnetic
2. Fix the hassle map
3. Build a complete backstory
4. Find the triggers
5. Build a steep trajectory
6. De-Average

In addition to the six steps, he emphasizes the importance of the launch, the portfolio and the linkage to scientific discovery and the future of demand.

If you’ve ever wondered why Netflix outperformed Blockbuster or why the Prius generates far more demand than the Honda Civic Hybrid, grab this book and start designing for demand for your company.

Now You See It: How the Brain Science of Attention Will Transform the Way We Live, Work and Learn

In the middle of all of the articles about how the internet and Google are making us stupid, Cathy Davidson provides a compelling alternative story about how the Internet is making us more human.  Through the combination of her research at Hastac, the MacArthur Foundation, and her own teaching at Duke University, Davidson provides actionable visions of the future of education and the future of work.  In the process of this work she has launched controversial projects such as giving iPods to the Freshman Class of 2003 as an educational experiment and suggesting a radical way of assessment in the university class of the future.

Several colleagues and I at the University of Washington Bothell are exploring innovation in the university.  Davidson’s research illustrates several qualities that are desirable in an idealized design.

Starting with a reference to the attention blindness experiment of the gorilla who moves through a group passing basketballs, Davidson argues that “attention blindness is the fundamental structuring principle of the brain, and I believe that it presents us with a tremendous opportunity.”   She goes on to assert:

“The twentieth century has taught us that completing one task before starting another one is the route to success. Everything about twentieth-century education and the workplace is designed to reinforce our attention to regular, systematic tasks that we take to completion. Attention to task is at the heart of industrial labor management, from the assembly line to the modern office, and of educational philosophy, from grade school to graduate school. Setting clear goals is key. But having clear goals means that we’re constantly missing gorillas.”

“In this book, I want to suggest a different way of seeing, one that’s based on multitasking our attention—not by seeing it all alone but by distributing various parts of the task among others dedicated to the same end. For most of us, this is a new pattern of attention. Multitasking is the ideal mode of the twenty-first century, not just because of our information overload but because our digital age was structured without anything like a central node broadcasting one stream of information that we pay attention to at a given moment. On the Internet, everything links to everything and all of it is available all the time, at any time. The Internet is an interconnected network of networks, billions of computers and cables that provide the infrastructure of our online communication. The World Wide Web lies on top of the Internet and is, in effect, all the information conveyed on the Internet.”

In addition to an evidence based glimpse into the future, Davidson shares her many links into social media for exploring this new world.  Through her enthusiasm I finally stepped my toe into the social media river (and no, it is never the same river twice) to follow several of her most useful generators of links to what is happening in the future of education.  Check out ToughLoveforX and enter his stream of over 80,000 tweets.

The Nature of Technology: What It Is and How It Evolves

In 1996, Brian Arthur published an article in the Harvard Business Review titled “Increasing Returns and the New World of Business“.  This article radically changed the way that I approach the design of a product.  When I design a product today, I am always asking myself “can this product lead to an increasing returns business?”  What led me to the article was a news report that a federal judge had disallowed the acquisition of Intuit by Microsoft based on the argument set forth in Arthur’s article.  In all my years of dealing with the legal industry I had not heard of an academic idea that had gone from publication to influencing litigation in a few short months.

In 1998, I heard that Arthur was giving the Stanislaw Ulam Memorial Lectures at the Santa Fe Institute on “Digitization and the Economy”, so I enticed several of my colleagues to spend a few days in Santa Fe, NM listening to Arthur’s lectures.  We were quite intrigued but weren’t sure there was anything actionable from the lectures.  We had to wait 12 years for the seeds of those lectures to show up in a paradigm changing book – The Nature of Technology.

As Thomas Kuhn did for the evolution of science in his book The Structure of Scientific Revolutions, Arthur does for the evolution of technology.

“Most of us do not stop to ponder technology. It is something we find useful but that fades to the background of our world. Yet—and this is another source of wonder for me—this thing that fades to the background of our world also creates that world. It creates the realm our lives inhabit. If you woke some morning and found that by some odd magic the technologies that have appeared in the last six hundred years had suddenly vanished: if you found that your toilet and stove and computer and automobile had disappeared, and along with these, steel and concrete buildings, mass production, public hygiene, the steam engine, modern agriculture, the joint stock company, and the printing press, you would find that our modern world had also disappeared. You—or we, if this strange happening befell all of us—would still be left with our ideas and culture, and with our children and spouses. And we would still have technologies. We would have water mills, and foundries, and oxcarts; and coarse linens, and hooded cloaks, and sophisticated techniques for building cathedrals. But we would once again be medieval.

“Technology is what separates us from the Middle Ages; indeed it is what separates us from the way we lived 50,000 or more years ago. More than anything else technology creates our world. It creates our wealth, our economy, our very way of being.

“What then is this thing of such importance? What is technology in its nature, in its deepest essence? Where does it come from? And how does it evolve?

“These are the questions I will ask in this book. . .

“I will build the argument piece by piece from three fundamental principles. The first will be the one I have been talking about: that technologies, all technologies, are combinations. This simply means that individual technologies are constructed or put together—combined—from components or assemblies or subsystems at hand. The second will be that each component of technology is itself in miniature a technology. This sounds odd and I will have to justify it, but for now think of it as meaning that because components carry out specific purposes just as overall technologies do, they too qualify as technologies. And the third fundamental principle will be that all technologies harness and exploit some effect or phenomenon, usually several.”

Arthur moves from his theoretical definitions of technology to the more practical guidance for how to evolve technologies.  His chapter on the “Mechanisms of Evolution” provides a blueprint for any technologist to envision creative ways to innovate in their particular domains.  His solutions are an excellent context for the 40 principles of Triz for innovation proposed by Genrich Altshuller as a result of his analysis and study of the corpus of patents.

If you are looking to innovate with technology, The Nature of Technology is the best starting point and a terrific context for employing the Triz principles.

The Filter Bubble: What the Internet is Hiding from You

I no longer know what I would do without Google as the search engine of my memory.  As we get more and more of the shallow and the deep web indexed, so much of what I previously needed to remember is readily available in the Googleplex.  Now I can focus on the larger concepts and wrestling with the details of the particular idea I focus on, while at the same time spending my brain cells on the relationships between ideas.

However, what I didn’t realize is the extent that Google is so customizing what it presents to me based on their 57 signals, that no two of us see the same information.  Pariser does an excellent job of presenting both the positive and dark side aspects of what customized search engines are doing to our ability to form any kind of consensus, particularly on the larger issues of the day.

“Few people noticed the post that appeared on Google’s corporate blog on December 4, 2009. It didn’t beg for attention—no sweeping pronouncements, no Silicon Valley hype, just a few paragraphs of text sandwiched between a weekly roundup of top search terms and an update about Google’s finance software.

“Not everyone missed it. Search engine blogger Danny Sullivan pores over the items on Google’s blog looking for clues about where the monolith is headed next, and to him, the post was a big deal. In fact, he wrote later that day, it was “the biggest change that has ever happened in search engines.” For Danny, the headline said it all: “Personalized search for everyone.”

“Starting that morning, Google would use fifty-seven signals—everything from where you were logging in from to what browser you were using to what you had searched for before—to make guesses about who you were and what kinds of sites you’d like. Even if you were logged out, it would customize its results, showing you the pages it predicted you were most likely to click on.

“Most of us assume that when we google a term, we all see the same results—the ones that the company’s famous Page Rank algorithm suggests are the most authoritative based on other pages’ links. But since December 2009, this is no longer true. Now you get the result that Google’s algorithm suggests is best for you in particular—and someone else may see something entirely different. In other words, there is no standard Google anymore.”

What I particularly appreciated about Pariser’s point of view is reminding me that any form of search is a matter of focusing on signals.  It is at the heart of what we did with Attenex Patterns.

Pariser does a good job of looking at “The Race for Relevance” and “The User is the Content.”  He points out the difference between Google’s Page Rank and Facebook’s EdgeRank.  PageRank uses the citation linking of the World Wide Web to adjust for relevance while Facebook uses your social graph to determine relevance.  Most of my counseling of software startups is to make sure they pay as much attention to the user generated content as they do to their own content.

Visual Complexity: Mapping Patterns of Information

For years, Manuel Lima has collected interesting and visually stunning graph diagrams on his website.  In 2011, he published the book in hard copy only.  The book is so beautiful I hate to mark it up, but lacking a Kindle edition my only resort is to make notes in the margin of the many ideas this book generates given my life long interest in visualizations and visual analytics.

I loved his introductory sentence:  “Visual Complexity looks at the intersection of two key techno-cultural phenomena of our time:  networks and visualization.  Both were relatively unknown only fifteen years ago but have since moved to the forefront of our social and cultural lives.”

In his information visualization manifesto, Lima proposes the following ten aspirational directions:

1. Form follows Function
2. Start with a Question
3. Interactivity is Key
4. Cite your Source
5. The power of Narrative
6. Do not glorify Aesthetics
7. Look for Relevancy
8. Embrace Time
9. Aspire for Knowledge
10. Avoid gratuitous Visualizations

While at Attenex, we developed visualizations of semantic networks, social networks, event networks, financial transaction networks, and geolocation networks as part of our visual analytics work for legal electronic discovery.  Lima provides scores of examples of each type of network, and more importantly the intersection of these types of networks.

The Accidental Creative: How to be Brilliant at a Moment’s Notice

Teaching courses on design and business, I am always on the lookout for good books about design, the design process, and innovation.  The Accidental Creative provides insights into how anyone can exercise their innate creative abilities.  Todd Henry has taken his experience as a creative consultant and made them available for the rest of us.

Many authors like Ken Robinson talk and write about how schools kill creativity through the way that we educate and the subjects that we emphasize.  Henry sets the stage for understanding the “create on demand” world that we now live in:

“Creative work comes with a unique set of pressures.”

“We’re compensated for the ideas we generate, the value we create, and the problems we solve, and though we may be good at what we do, many of us may feel at least a little out of touch with the mysterious process by which any of this happens. On some days, ideas spring forth effortlessly, and we feel poised to attack any problem that comes our way. On others, we struggle with a single obstacle without any significant momentum. It can be frustrating to be held responsible for something we have so little control over, especially in the marketplace, where our career success is directly tied to our ability to generate great ideas consistently.

“Many of us assume that our creative process is beyond our ability to influence, and we pay attention to it only when it isn’t working properly. For the most part, we go about our daily tasks and everything just “works.” Until it doesn’t. We treat our creative process like a household appliance. It’s just expected to work quietly in the background, and we lose sight of how much we depend on it until the day we’re stuck with dirty socks.

“Adding to this lack of understanding is the rapidly accelerating pace of work. Each day we are faced with escalating expectations and a continual squeeze to do more with less. We are asked to produce ever-increasing amounts of brilliance in ever-shrinking amounts of time. There is an unspoken (or spoken!) expectation that we’ll be accessible 24/7, and as a result we frequently feel like we’re ‘always on.’ And because each new project starts with a blank slate, we feel like we have to prove ourselves again and again. No matter how successful we’ve been in the past, each new project elicits the question: ‘Do I still have it in me?'”

Henry then goes on to talk about the challenge of working in creative teams, advice which I regularly pass on to my students and to innovative entrepreneurs:

“Creative teams face two conflicting pressures: to produce timely and consistent work, and to produce unique and brilliant work. The pull between these two expectations creates a tension like that from two people pulling on a rope. When this pull—between possibilities and pragmatics—becomes too strong, the rope is taut, eliminating the peaks and troughs of productivity required do our best creative work.

“We are constantly forced to choose between striving to improve the quality of our work and driving it to completion. This dynamic manifests itself in three tensions: the time-versus-value tension, the predictable-versus-rhythmic tension, and the product-versus-process tension. . . .”

“As a creative worker, you’re not really paid for your time, you’re paid for the value you create.”

The remainder of the book suggests many strategies and practices for becoming an accidental creative.

What I Didn’t Learn in Business School:  How Strategy Works in the Real World

One of the core principles we lived by at Attenex as we developed our value based pricing strategy, was to make sure that each participant in our value chain could be very profitable.  In reviewing hundreds of business plans, teaching hundreds of MBA and design students, and mentoring entrepreneurs, I discovered that most business professionals understand very little about the value chain that they participate in.

To help with their education, I developed several diagrams that illustrated the eDiscovery value chain we participated in, the value based pricing at each stage of the value chain, and the total revenue generated by the collection of participants at each stage of the value chain.  After gaining understanding of where we participated in the value chain I then pose the question “if you were the executive team at Attenex, what strategy would you pursue for growth in this value chain?”  The discussion is always lively and a delight as the “students” have the insight light bulb go on when they relate the Attenex value chain to their own value chain.

Jay Barney takes the original notion of Michael Porter‘s Value Chain several steps further by making the understanding of one’s value chain into an actionable set of strategies and tactics.  He describes the VRIO framework as:

“First, is a strategy valuable? Does it increase a firm’s revenues or reduce its costs compared to not pursuing the strategy? Providing value to customers above and beyond what competitors offer is usually the most obvious way to increase a firm’s revenues. Eliminating waste from operations or changing the firm’s business model to make it more efficient is the quickest route to cost reduction, although location decisions, improvements in quality, and other strategic choices contribute to both top-line and bottom-line value-add. Obviously, strategies that aren’t valuable can’t be a source of competitive advantage.

“Second, does a firm possess unusual skills or other assets that this strategy would utilize? This is the question of rarity—if many firms all have the ability to execute the same strategy, then that strategy will probably not be a source of advantage. This doesn’t mean that valuable, but common, strategies aren’t important. Lots of firms have created economic value through valuable but common strategies. Firms shouldn’t expect, however, to gain advantages from these strategies—they are only a source of competitive parity, the table stakes that a firm has to ante up to be able to compete.

“On the other hand, valuable and rare strategies can be a source of at least a temporary—and sometimes very lucrative—advantage. In fact, numerous firms “make their living” by implementing a series of strategies, each of which is only a source of temporary advantage.

“Third, how long will it take other firms to imitate your strategy? Strategies that are hard to imitate—assuming they are also valuable and rare—are more likely to be a source of longer-lasting competitive advantages. If, on the other hand, competitors can begin to imitate a firm’s valuable and rare strategy as soon as it becomes public, then that strategy will create only temporary advantages.

“I had learned that a firm’s strategies can be difficult to imitate for several reasons. Some strategies rely on assets that may be protected by patents. Or maybe the execution of a strategy requires skills that took a particular firm many years to develop. Maybe their execution depends on trusting relationships among a firm’s managers, between a firm and its suppliers, or between a firm and its customers which are often difficult and time-consuming for others to replicate. Sometimes it can even be difficult for competing firms to describe exactly why a particular firm has an advantage. Obviously it is hard to imitate what you can’t even describe! Whatever the reasons, firms that implement valuable, rare, and costly to imitate strategies will often be able to gain more sustainable advantages.

“The fourth question focuses on organization—is a firm organized to execute and protect its sources of advantage? According to my professors, organization—things like a firm’s reporting structure, management controls, and incentives—enables firms to realize the full potential of its strategies. But the question of organization often hadn’t required an answer, since I found that answering the first three questions in this framework was usually enough to crack a case.”

Barney’s book is a welcome addition to helping business professionals understand how to think about the business ecosystem that they are a part of and if they have a choice only enter value chains where each participant can be profitable.  Barney’s work is a nice complement to Mack Hanan’s observation that you cannot grow your own business, you can only grow someone else’s business.  Both of these insights are difficult revelations for most entrepreneur’s to hear.

Boomerang: Travels in the New Third World

For many years, I’ve been a Michael Lewis fan.  He has the capability of being optimally ignorant to explore such diverse areas as financial trading on Wall Street, the making of an Internet Company, the transformation of baseball scouting, and the making of a professional football left tackle.  Some of his books are downright scary and some are wonderful human triumphs over adversity.  Boomerang is definitely in the scary category.

Just when I thought it might be safe to start investing again, Lewis explains that we have a long way to go to dig out of the financial meltdown of 2008 because of the absurdity of the many different ways that Europeans are acting with their own banking crises.  Of particular pain is that while the US Federal Government can issue debt, cities and municipalities cannot.  All around us we are seeing cities on the verge of bankruptcy.  His story of Vallejo, CA, which I often drive through on the way to Napa and Sonoma is a sobering lesson for us all.

The example that stopped me short was a symptom of the Irish financial disaster:

“A few months after the spell was broken, the short-term parking lot attendants at Dublin Airport noticed that their daily take had fallen. The lot appeared full; they couldn’t understand it; then they noticed the cars never changed. They phoned the Dublin police, who in turn traced the cars to Polish construction workers, who had bought them with money borrowed from the big Irish banks. The migrant workers had ditched the cars and gone home. A few months later the Bank of Ireland sent three collectors to Poland to see what they could get back, but they had no luck. The Poles were untraceable. But for their cars in the short-term parking lot, they might never have existed.”

Boomerang is a powerful collection of short essays country by country and municipality by municipality that provides insights into the trends that are behind the evening news.  According to Lewis, we are a long way from finding our way out of the international human excesses of the financial meltdown.

Living with Complexity

Don Norman is one of my favorite lovable curmudgeons.  He is wonderfully insightful and a joy to both read and listen to when he is in lecture mode.  He can also contradict himself over the years, one of the potential pitfalls of a well known author.  In several of his early books he extolled the virtues of simplicity.  With Living with Complexity he seems to change his point of view.  My sense is that he has expanded his view of the seeming tension between simplicity and complexity.

He looks at this problem through a few definitions:

“Why is our technology so complex?” people continually ask me. “Why can’t things be simple?” Why? Because life is complex. The airplane cockpit is not complex because the engineers and designers took some perverse pleasure in making it that way. No: it is complex because all that stuff is required to control the plane safely, navigate the airline routes with accuracy, keep to the schedule while making the flight comfortable for the passengers, and be able to cope with whatever mishap might occur en route.

“I distinguish between complexity and complicated. I use the word “complexity” to describe a state of the world. The word “complicated” describes a state of mind. The dictionary definition for “complexity” suggests things with many intricate and interrelated parts, which is just how I use the term. The definition for “complicated” includes as a secondary meaning “confusing,” which is what I am concerned with in my definition of that word. I use the word “complex” to describe the state of the world, the tasks we do, and the tools we use to deal with them. I use the word “complicated” or “confused” to describe the psychological state of a person in attempting to understand, use, or interact with something in the world. Princeton University’s WordNet program makes this point by suggesting that “complicated” means “puzzling complexity.”. . .”

“Why has the term “technology” come to refer primarily to items that cause confusion and difficulty? Why so much difficulty with machines? The problem lies in the interaction of the complexities of technologies with the complexities of life. Difficulties arise when there are conflicts between the principles, demands, and operation of technology with the tasks that we are accustomed to doing and with the habits and styles of human behavior and social interaction in general. As our technologies have matured, especially as everyday technologies have come to combine sophisticated computer processing and worldwide communication networks, we are embarking upon complex interactions.

“Machines have rules they follow. They are designed and programmed by people, mostly engineers and programmers, with logic and precision. As a result, they are often designed by technically trained people who are far more concerned about the welfare of their machines than the welfare of the people who will use them. The logic of the machines is imposed on people, human beings who do not work by the same rules of logic. As a result, we have species clash, for we are two different species, people and technology. We are created differently, we follow different laws of nature, and each of us works according to invisible principles, hidden from the other, principles that harbor unspoken conventions and assumptions.”

From a human centered design perspective, this tension between simplicity and complexity and complicated is at the heart of the user research needed to figure out what is truly desirable (the “got to have” functionality).

Agency Mania: Harnessing the Madness of Client/Agency Relationships for High-impact Results

Bruno Gralpois is a deeply experienced marketing professional who has spent equal amounts of time on the advertising agency side of the business and the client side of the business.  Through my colleague, Katherine James Schuitemaker, I had the privilege of meeting Bruno as he was putting the finishing touches on his book Agency Mania.

Based on our conversations, Bruno asked me if I would write the Afterword to the book.  I had no idea what an Afterward was, but I told him I’d be happy to do a draft.  He could then decide whether it might be acceptable.  What I put in the Afterward is the best recommendation I could make for this book:

“Perspective is worth 80 IQ points.” Alan Kay, Xerox Dyanabook, Apple Mac, Disney Imagineer

“Where was Agency Mania thirty years ago when I first needed the deep expertise embedded in this book?  As a young product development manager of a software product that became a $1 billion a year business for Digital Equipment Corporation, I first encountered our marketing department and the advertising industry at a boutique ad agency on Madison Avenue.  I had no idea what to expect or ask for or any criteria for recognizing good or bad creative services.

“Over the years as I progressed from a product development manager to a senior executive and to the CEO position of a range of enterprise software and consumer software businesses, I never was comfortable with the results I was getting from the large portion of my budget going to marketing and advertising.  When it came to advertising, I never found a good surrogate for my lack of experience or inability to judge talent and their results (or lack thereof).  With Agency Mania, I have the tools to work with marketing teams to set appropriate expectations for a given agency project and the ability to probe agency talent and their results early in a project to achieve desired results.

“While Agency Mania is targeted at marketing professionals working at advertisers and agencies, it is just as valuable for any executive managing those marketing professionals and most especially for those executives managing product development.  The first rule of good management is to “expect what you inspect.”  For those executives not trained in marketing, it is difficult to figure out what are the appropriate expectations of advertising let alone know how to inspect important projects.  The first eleven chapters provide a wealth of “inspect” questions along with a “top five” best practices at the end of each chapter.

“For non-marketing senior executives, the “Brave New World” chapter describes an exciting new world of digital marketing that screams all at once – Opportunity, Complexity, Challenge, High Risk, High Reward.  As another important industry transforms to all “digital” everything changes, not just be a little, but by a lot.

“At the center of the change is the transform of the Agency-Client-Media Troika to an ecosystem where the consumer is an equal player in the “conversation” and brand experience.  As the author points out the conversation expands from a “brand to consumer” world to include a “consumer to consumer” world.  All of a sudden the consumer becomes a producer not just of valuable content, but also of raw data, and in some cases software applications that surround the content and data.  The consumer is no longer just a consumer but a producer or “prosumer.”

“The Nike example at the beginning of the “Brave New World” chapter is an excellent example of an ecosystem that began by putting a computer in a running shoe to instantaneously adjust the performance of the shoe to fit the demands of a particular workout and terrain.  The minute the computer was a part of the physical shoe then it was a simple matter to communicate the data to an iPod to make it easy to then upload the information to a database where the prosumer can set goals and monitor performance.  The availability of lots of actual data from millions of prosumers then lets Nike or the prosumer change and tailor the performance of a custom designed running shoe or custom tailor the performance tuning of the shoe.  And if the system can go that far, why not change the music on the iPod to be in tune with where the prosumer is in the workout – calm music for warming up or warming down changing to rock music as the pace of the workout increases.  This virtuous cycle becomes rich fodder for the agency talent to mine to find a myriad of audience segments to further tune product offerings and brand experience offerings.”

“Bruno Gralpois does an excellent job describing the inclusion of the engaged consumer as a first class citizen in the distribution of brand experiences and he hints at where this new digital world could really go – the inclusion of agency talent at the beginning of the product development cycle rather than at the end.  Human centered design professionals and user experience design professionals are dramatically changing the product development process by getting product teams to focus on the customer needs early and often in the process.  Yet, these professionals are not nearly as skilled as agency talent in capturing the consumers’ emotions, creating engaging stories, and embracing and energizing brand principals and experiences.  Executives should be asking “how do we make the best use of agency talent throughout the product development process” not “how do we cut costs?”  It’s about making sure that products are desirable from the very beginning of product development to ensure early emotional engagement on the part of the prosumer.

“As traditional products become more “digital” the opportunities to include two way communication in the product and new venues for “brand experiences” show up in the unlikeliest places.  As home heating and air conditioning and electrical systems start including digital components, a new or remodeled  house now has a plethora of LCD devices displaying rudimentary information to the consumer.  Yet, these systems can have simple sensors connected to the internet to identify problems long before a failure occurs.  Currently these manufacturers are looking at these information sources as an opportunity to get a little more maintenance revenue, but what if they became a backbone for a whole thoughtful infrastructure like the Nike example.  What if these display devices and systems became an outlet for “green advertising” and every day sustainability awareness and education.

“In the midst of this insurmountable opportunity, lies a forest of risks and difficult issues at the heart of which is “who owns what?”  As the creative work of the agency moves from the relatively simple world of copyrights and trademarks to the digital world of data and identity privacy and software patents, negotiating who owns what becomes extremely complex with lots of billable hours to expensive lawyers.  Mr. Gralpois alludes to the challenges of contracting in the relatively simple world of traditional media which become much worse when trying to protect valuable intellectual property related to software (see the recent position paper from AAAA on “Software and Software Tools:  Ownership and Use Contracting Considerations When Creating Digital, Online and Mobile Content”).  The patent process is an expensive arena to participate at the cost level and in the learning required of the agency software development teams.  Then as the prosumers enter this complex IP world simple user licenses may no longer apply as litigation risks of those who appropriate the user generated content and software and designs increase.  The challenge of just tracking what IP is being used at any one time can seem daunting.

“While the complexity of the advertiser-agency relationship is challenging, adding the prosumer’s rights into the mix is quite confusing.  For the prosumer, the ability to design a new Nike shoe is a huge value add, but what happens if Nike puts that design into mass production?  Is the prosumer owed a royalty stream for their design?  Who would be listed as the inventor for a patent on a new “collaborative” prosumer design?  Many industries invest millions of dollars in “freedom to operate” searches to avoid future patent litigation.  Will advertisers and agencies need to do the same kinds of expensive searches for high profile software based advertising?  Will we see agencies banding together to invest in Intellectual Ventures types of patent holding consortiums to reduce the risks associated with technology development?  Who owns the data that Nike shoes generate about the physical workouts and health of a consumer?  Does this data need to be protected with the same care as medical records?  The answers to these questions must be a part of the intellectual property strategy of the digital agency.

“IP creation, protection, contracting, valuation, brokering, and management become new skills that both the advertiser and the agency must develop as part of the agency management process.  These skills ultimately need a new breed of software due to the sheer volume of content and software applications that need to be tracked.

“The pace of change in the relationship of the new tetrad of agency-client-digital media-prosumer is just beginning.  The old proverb “may you always live in interesting times” is an apt description of the “brave new world” of agency management.

“Throughout the book, I felt that Bruno Gralpois was my personal mentor guiding me through the labyrinth of how to manage the marketing department and agencies to achieve the business results I expect.  I am very appreciative that Bruno Gralpois asked me to review his book as it has changed my view of marketing and advertising from something cloaked in creative mystery to something that can be managed.”

Reading through the book gave me the knowledge and confidence to participate more broadly in marketing discussions that as a business strategist, entrepreneur, and technologist I’d previously stayed quiet.  For those entrepreneurs who have a difficult time understanding why they should spend a lot of their time profiling their users and paying attention to user generated content, I point them to the “Brave New World” chapter.

Content with Context

The books on this list cross a wide range of topics including marketing, learning, technology evolution, creativity, and many business frameworks.  They also deal with the global economy that we now live in and what it takes to be successful creating products, services, and new ventures.  One of these days, I will not only be able to review and recommend such excellent resources but also provide “content with context” so that these books are not just static but instant “just in time” advisers for your current innovation.