by Dana Blankenhorn
Volume V, No. XXV
For the Week of July 2, 2001

This Week's Clue: 21st Century Business Principles

This Week's Clue: 21st Century Business Principles 

SSP (Shameless Self Promotion)

SP (Shameless Promotion)

The Right Reason to Go Public

The Key to Opening New Domains

A Useless Victory

Clued-in, Clueless

A new "conventional wisdom" has arisen. It is just like the wisdom that existed before the Web was spun. This makes it comforting. It doesn't make it right.

Netslaves, which has built the dot-bomb community Philip Kaplan only dreams about, had a contribution recently on "the new dot-com." The article reflects this new "conventional wisdom." 

Some ideas in the story make sense. Experience matters, ethics matter, while attitude doesn't matter.

We've discussed when to charge for content and when not to until I'm sick of it and you are too. But in case you missed it, let me summarize. You build a "membership" bundle to encourage registration and audit circulation to prove your brand-building impact. As with a print product you then create "up-sell" products - books, market research, events - to bring in more cash and to serve your target market. You earn back your CP/M and you earn new forms of cash flow. You don't demand anything from anyone - you're in no position to demand. (Enough about that.) 

What was most poorly understood in the 1990s was that there are many types of dot-com jobs. They have different skill sets, different levels of creativity, and they require different working conditions.

Throwing a bunch of just graduated code-writers into an open space with walls stripped-back to the wiring and a statue of Han Solo in the corner won't transform them into a creative team. If that's the style of the minute, throw it up on a small scale for the clients, but don't waste money by making everyone conform to it.

Creative people need autonomy, support and (sometimes) a kick in the butt. When they're creating it pays to leave them at home, with the DSL line and the TV in the corner (assuming their kids aren't in the way). But they're not creating all the time. Sometimes they need to be planning or coordinating with others. That's when they need to be in an office. Sometimes they need to be in the real world, listening to customers. (Yes, even creative people create for the market, so they should hear the market.) Sometimes they need to be gaining new skills (education is a continuing expense). Sometimes they need to go on vacation to recharge. Your Clue for handling creative people is simple - avoid ruts - yours, theirs, anyone's. 

There are also going to be people in the 21st century who don't work to live, but live to work. There are going to be lower-skilled, even repetitive jobs, jobs that require minimal education. There are going to be people who prefer structure, who don't want to think all the time, and who want to clock in, do their time, then clock out. These people need to work in factories and warehouses and offices, even in delivery trucks. Computers can't organize business alone. Telecommuting won't work for everyone. Facilities are necessary to use these people to their maximum. Facilities provide structure. Use your facilities in this way. 

What skills do entrepreneurs need that they didn't have before? Mostly they need to listen. Your business won't necessarily be what your vision says it should be. Listen to your customers. 

Human relations is also about listening - it's about really hearing and doing what it takes (within the budget) to spur productivity. H.R. is not a department for anal-retentive form-fillers (although it helps to have some of the back room). If people fear your H.R. department, fire 'em and start over.

Budgets must be quarterly (at most) and should show green at the bottom. In hard times honesty over your financial condition will help the affected workers build win-win part-time agreements with you. (A business is a network of people - maintain that network.) Workers must understand the relation between what they do and the money that comes in. Obviously everyone must conform to financial realities - one reality is we need to be honest about them. 

So the new business organization isn't all a bunch of freelancers, but we're not going back to the days of the Organization Man, either. Computers and networks must be used whenever they're effective. They must do as much of the company's business as they can. But they can't do all of it - if they're doing all your company's business your business is about to disappear. 

The new business reality is harsh but honest. Most of all (for dot-com companies especially) it's flexible, and so are the people within them. All your stakeholders - customers, employees, and investors - are with you because it's best for them. Once that changes (when the grass really is greener) they're out of here, fast.

Internet companies are easy to build and easy to kill as well. To work best they require open eyes, open minds and open hearts. That's not a value that is easy for all executives or entrepreneurs to deliver. But there are plenty of other industries (which use the Internet less) where those people can work. 

SSP (Shameless Self-Promotion)

I don't like to brag, but it is gratifying that I've been able to gain yet-another outlet while the market continues to drag. I'm pleased to welcome Sitepoint  to my list of writing clients, starting this month. I still would like to find a new client for daily writing, however, so if you need daily content that can boost your traffic then please contact me.

"Living on the Internet: How to Make Money, Live Right, and Fight For the 21st Century" is tentatively due for release around Labor Day. I'm still writing it, but it looks good. I call it the "first book of the 21st century" because it is designed to feature hyperlinks in all formats - PDF, eBook, and print. (How about if we call it an I-Book for short?) Drop me a note to get on the mailing list for more information on this book. You can join the A-Clue.Com discussion at I-Strategy , our shared e-mail digest produced with Adventive.Com. You can also read me at ClickZ , B2B, at Boardwatch, ISP Executive and at Internet Content. More deals are being sought. Remember that it's journalism that keeps the Clues coming...

Shameless Promotion

You have a little list, but how do you make the most of it? You turn it into a database, you query the database, you audit the results and you deliver market research to yourself and to others.

Permission is just the first step. An audit is the second step. Building interactive relationships with every name in your database is the greatest business asset you can have.

You can take the first step toward making your little list truly valuable with help from my friends at Whitehat Interactive - click here to begin that journey.

Takes on the News

The Right Reason to Go Public

One of the most famous scenes in the annals of American business is of Bill Gates and Steve Ballmer, flying east in First Class before the Microsoft IPO. The investment bankers had insisted on the pricey seats, so the two were gleefully abusing the in-flight phone and laughing at the money they were wasting.

There is a serious lesson in this story. You don't go public because you or your investors or your company needs the money. You go public because your employees and other co-conspirators need some economic flexibility. You go public after you start making money, not before, when you're ready to be judged based on results, not promises.

Someone has finally learned this lesson, and as usual it's the folks at Google . Expect an IPO before the end of the year. My guess is it will be a bargain.

The Key to Opening New Domains

A lot of entrepreneurs are busy trying to scratch out new Top Level Domains, with or without the permission of ICANN . To some analysts, this is a battle between capitalism and central control. That's the wrong way to look at it.

The right reason for opening new domains is to kill the domain name after-market. There is no reason why a business name should cost more than the cost to register it. There is no reason why many businesses can't share the same name, especially if they're in different industries.

Very few trademarks are so precious, valuable and international as to require registration in all the world's domains and for all the world's industries. Here's one. But at the same time there's no reason why critics of the best trademarks should be denied obvious routes to the Web, as the target of this site tried to do last year. There is also no reason why one company should be able, through skillful use of the domain name system, to put its own toll of dominance on criticism.

The paragraph above describes principles. Many in the Internet space today find principles lacking as concepts. These people should understand that self-interest is also just a principle. It's a valid principle, but it is not an absolute principle.

Here's another principle that needs to be ingrained on the Web. Checks and balances - without them a company, national government, or other conspiracy could obtain absolute power, the kind of power that corrupts absolutely. No one should have the power to dictate to the whole Web with impunity: not even me.

A Useless Victory

The Supreme Court decision that upholds freelance writers' power to seek more money when their work is "republished" for the Web sounds like a big deal . It is not a big deal.

Ever since the case was filed major publishers have been routinely inserting clauses into freelance contracts giving them just the rights - that of republishing online without compensation - that were at issue in this case.

The fact is that the negotiation between publisher and writer is always one-sided. There are only two ways this could change, a "closed shop" arrangement in which writers could collectively demand something better, or new law mandating fairness in writing contracts.

A strong union does exist in the entertainment area, and writers there were able to hammer out something they could approve . Journalists who work for publications have no such power, and it's more than unlikely that laws will be changed in our favor.

Tony Bove said it best. Always be wary of a business where the first word is submission. That this is the only business I know, and the business I love, is my misfortune - yours if you share my passion.

Clued-in, Clueless

Clued-in is Danny Sullivan, an Internet.Com acquisitions that has proven to be a real bargain . The lesson for others lay in the motivation of the seller. Danny sold so he could concentrate on the product. Those who sell to cash out or to retire don't sell nearly as much as many buyers think.

Clueless is Truste's new labeling system, designed to let visitors see a site's privacy standards at a glance. What we need is one, firm, and high standard for privacy, not pretty pictures.

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