The following “dueling emails” appeared on Borders Online during the latter part of 2001.
Christopher Locke and John Patrick The Internet, unlike Internet stocks at the moment, is not dead. Christopher Locke, one of the coauthors of the popular The Cluetrain Manifesto, and John Patrick, Vice President of Internet Technology for IBM, have been thinking about and working with the Internet since Mosaic and Netscape brought the World Wide Web to the rest of us. Locke’s new book, Gonzo Marketing: Winning Through Worst Practices, is a muscular combination of social criticism, biting satire, and serious advice to corporations. Patrick’s new book, Net Attitude: What It Is, How To Get It, and Why Your Company Can’t Survive Without It, tackles the cultural assumptions that currently prevent businesses from making the most of the Internet. It’s probably fair to say that while Patrick is a reformer, Locke is a revolutionary. We asked them to engage in a correspondence about where the Internet has been, where it is going, and what it all means for the way in which businesses communicate with customers. They responded with an email exchange that is by turns funny and heated, but always informative and passionate.
From: Christopher Locke To: John Patrick John, You make a number of points in Net Attitude with which I strongly agree. For instance, talking to teens about the Net is certainly on the money. As is your suggestion that the suits spend more “quality time” on the Web. More interesting, though, is the question of why at this late date such advice is still received as surprising “news” in so much of the corporate world. My take is that there are more fundamental reasons why what you call “net attitude” is largely missing from the ranks of corporate management. Primary among these is an unconscious reliance on the conceptual logic of earlier broadcast media, such as television. And the broadcast mindset is grounded in something even deeper: the inherently authoritarian dynamics of command and control. Unquestioned authority (command) and the ability to manage and direct outcomes (control) are staples on which companies have depended for at least a century, and the Internet threatens this dependence in ways that are terrifying to corporate management. The Net demands of companies not just that they do things differently. It demands that they do different things altogether. One of the most difficult of these demands is to stop looking at global networks from a business perspective. Is this a tough thing to do? Yeah, very! But look at the costs of side-stepping this new and non-negotiable requirement. When business looks at anything through the lens of business, all it can see are market opportunities. And marketing based on broadcast assumptions, with all their attendant command-and-control baggage, will always result in adversarial power tripping with respect to that whole “outside” world you are advising corporations to bring in. We still hear these companies talking about dominating markets, penetrating niches, capturing eyeballs, launching killer apps. This is the language of war, not of the kind of collaboration and community the Internet, by its very nature, invites. Far from believing that the Next Generation Internet (NGi) will solve these bedrock problems, I think it will exacerbate them unless they are faced squarely now for what they really are. These are not technology or management puzzles of the sort with which business is comfortable and familiar. Instead, they involve deep questions about the fundamental relationship between commerce and society as a whole. If we answer these questions with higher-tech Band-aids, I fear that the resulting “net attitude” will merely drive a deeper wedge between corporations and the human beings who work for and buy from them. What say you to that? Chris ———————————— From: John Patrick To: Christopher Locke Hi Chris. You make a lot of very good points. I suspect we are somewhat an antiphonal choir, each singing the praises of the Net in different ways. While we agree quite a bit on the state of things, I am not so sure we see the causes in quite the same way. I don’t feel that corporate management has been asleep. I also don’t think it is quite fair to say that “command-and-control” mentality is the root cause. You and I are very fortunate to have been in the center of the Net explosion. In fact it has been to some degree been our vocation—and probably also our avocation. In short we were right in the middle— full time. Some corporate management, on the other hand, has been anything but full time. For them, the emergence of the Web was something added to their plate at a time when unprecedented demands were being made of them to master globalization, complex regulatory issues, increased competition from all corners, changes in labor demands, and an exponential increase in the pace of technology growth. Having said that, I do agree that it is high time for corporate management to pay strong attention to the fact that the Internet is transferring power from institutions to people. Power to the People! Not in the sense of anarchy, but rather a recognition that the power of a mouse click or the click of a button on a mobile phone or other Net device is a powerful statement. Institutions of all kinds, business or government or hospital or university, that grasp this phenomenon will win large rewards and those that ignore it will perish. So, yes, I agree that management needs to pay close attention. Fortunately, it is not too late for those who were not early adopters. We are at the very beginning. At times the hype would make us think that everyone is using the Net. Fact is that the number of people who are using the Net right this very minute—as a proportion of the world’s population—rounds off to about 3%. Maybe 5% but not more. We truly are at the beginning. That doesn’t mean anyone should rest. Now is the time to talk to those kids (and seniors) and find out what they think about the future and get about building e-businesses that meet their needs and expectations. The expectations are growing rapidly, and there is a gap forming between what people expect from the Net and what they are getting. As for your comment that the Next Generation of the Internet may exacerbate problems instead of solve them, I do take issue. While I agree that technology alone is not a panacea, I believe that an Internet that is truly fast, always on, accessible everywhere from many kinds of devices, more natural to use, more intelligent for searching and retrieving information, easier to build applications for, and enabled with digital IDs to insure authentication and trusted transactions—that such a more advanced Internet will make a big difference in business effectiveness. A more powerful Internet will drive a deeper wedge between corporations and consumers? I don’t think so. John ———————————— From: Christopher Locke To: John Patrick John, You mount a good defense for corporate blindness with respect to the early Internet. Yes, I agree that many Fortune-class outfits were already overworked with various globalization schemes in pursuit of broadband e-colonialism. I’m all sympathy. Where’s my violin? But the point is moot. Is it crucial that corporations grasp the significance of what’s happening on the Net? Yes, of course: It’s critical for them. And what if business fails to comprehend this profound tectonic shift? Does that fundamentally change the significance of what’s taking place online? Not a whole hell of a lot. Why? Because e-business is not what defines or bounds or typifies this medium. Business, in fact, came late to the party. Nonetheless, ever since it arrived, business has been trying to convince us that the Internet is its party. Despite the billions spent on funny hats and noisemakers—the rising din of online advertising—this ploy isn’t working. We’re not buying in. We think business looks silly in its birthday suit. In your book, you urge companies to think “outside-in” rather than “inside-out.” As you remind business, “outside is where all the people are.” You’re right, of course. Who could argue with such an obvious statement? But because outside is where the people have always been, this insight brings more of a “Duh!” than a “Eureka!” reaction. You must have asked yourself many times, as I am asking now: Why do corporations need to be reminded of such patent truths? The answer, I believe, is revealed in the very notion of outside and inside. Ask yourself: What is the focal point that defines “inside” and “outside”? What is the perspective from which these terms are used? The answer to both questions is: the company. You are describing a view of the Net from inside the corporation. Inside and outside may sound harmlessly lateral at first, but the corporate mentality for at least 100 years has been to define itself as the center in which control resides and from which commands issue forth—that is, to the “outside” where all those people are. Turn your model 90 degrees and it’s a top-down hierarchy. But networks have no tops and bottoms, no insides or outsides. Networks are tangled graphs of nodes and arcs, webs of hyperlinked mutual curiosity. No one is in control any more. No one is listening for the next command. You say the Net is transferring power from institutions to people, and I strongly agree. [restore original]But that means that it’s high time for companies to stop asking how business can use, leverage, exploit, and otherwise take advantage of the Internet—and to start asking what “the people” are actually using it for. In most cases, the promise we see as “outsiders” is precisely not to become more efficient, friction-free consumers, but instead to become more fully human. As I wrote in my Gonzo musings: “We are more than is dreamed in your marketing plan, Horatio.” So yeah, I freely admit it. I’m far less interested in the bells and whistles of the Next Generation Internet than I am in the quality of mind and heart that will bring about the Next Generation Civilization. Net or not, that’s the attitude I care about promoting. Inside or out, that’s our ticket to ride. Best, Chris ———————————— From: John Patrick To: Christopher Locke Once again, Chris, we agree on some things but come from a different perspective, probably based on our different experiences. I agree that many businesses came late to the party, but business is indeed fundamental to the Internet. The roots of the Net were in government and academia as we all know. As Internet traffic began to explode in the first half of the 1990s, it became clear that huge network and server capacity was needed to keep things going. It was businesses that made that investment. While government and academia remained (and still do remain) important, it was business that fueled the investments that have made the medium now used by hundreds of millions of people possible. E-business is a really big deal. It is much more than “click here to buy.” An e-business is an electronic business that reaches all constituencies of a business, not just those who want to buy something. It includes buyers, suppliers, stockholders, employees, business partners, and the press and financial analysts who follow the company. An e-business provides all transactions and interactions that any constituent may need—buying something, selling something, getting a price, checking the status of an order, signing up for the local blood drive, changing employee benefit choices, listening to a quarterly analysts’ briefing, participating in an electronic meeting, or collaborating on a new product design in a virtual laboratory. E-business is very much about the transformation that I think both of us want to see. The big issue is accommodation. Organizations of all kinds have a fundamental decision to make. Choice number one is to accommodate the Internet but continue to do business the way they have been doing business. “Yes, we are really into the Internet. We have an e-commerce Web site.” While “accommodating” the Internet, they tacitly embrace their old vocabularies, old attitudes, and old ways of doing business. Choice number two is to become an e-business and embrace the Internet as the primary relationship mechanism, not an alternative mechanism, with all constituencies while accommodating the way they have been doing business until they are able to morph those old attitudes and processes into more Net-based ones. Customers (both business and consumer) will be judging organizations based on their online presence I don’t think outside-in is as obvious to organizations as you say. It really is easier to think and act internally. The call centers we all know and love are good examples. “Listen carefully because our menus have changed!” Who cares? The people out there have something they want to ask for and in many cases it is the call center that stands between them and getting satisfied. Really good e-businesses listen hard to what the customers are saying. . And, yes, I am still sticking by my prediction that the NGi will become extremely important. In fact, the “Next Generation Civilization quality of mind and heart” that you are seeking will come about by a combination of Net Attitude and the NGi. Neither can do it alone. –John ———————————— From: Christopher Locke To: John Patrick John, I didn’t mean to suggest that your notion of outside-in thinking is obvious to organizations. Quite the contrary. Most businesses, as you rightly point out, are far too focused on their own insular affairs. What I was saying is obvious is that markets exist outside, and independent of, those internal concerns. Precisely because this is so inarguably true, I find it amazing that otherwise intelligent corporate managements need to be reminded of this simple fact. Why does what you call “inside-out” thinking remain the norm, even though many companies know it is hugely counterproductive? I think our respective answers to these questions serve to highlight the fundamental differences between your book and mine. Gonzo Marketing attempts to show that contemporary problems surrounding commercial adaptation to the Internet (or lack thereof) are rooted in much older and deeper assumptions about the nature of business. These attitudes go back to the earliest forms of high-output industrial organization, starting with Frederick Taylor’s so-called “scientific management” (1911) and Henry Ford’s moving assembly lines (1913). These hierarchical, bureaucratic systems depended very heavily on command and control. This is not my opinion, but well-documented fact. The central premise of my critique is that broadcast media inherit these industrial axioms, and that businesses relying on such models replicate authoritarian relationships to markets. This is clearly a non-fit with the culture of the Internet. From everything I’ve experienced online, “net attitude” tends to strongly resist—vocally and vehemently—the kind of arrogance companies have come to assume over the last 100 years as their “natural” right. It is not natural. And whether it is their right or not is purely academic: it doesn’t work. Instead of creating friends and allies, it pisses people off. I believe that any attempt to look honestly at what’s happening outside the company must acknowledge these changed market expectations that have been catalyzed by global networks. Such acknowledgement entails corporations admitting that they’ve been acting as dictators lo these many years, in relation to both employees and customers. How many PR departments are going to get excited about conveying thatmessage? In Net Attitude, you enumerate many efficiencies that the Next Generation Internet will bring. Basically, I have no argument there. Would I like a Net that was fast, always on, everywhere, natural, intelligent, easy, and trusted? Sure. Who wouldn’t? But these are mainly pipes-and-wires issues—the sort of things with which technologists love to get their hands dirty. Great! At least it keeps them off the streets, I suppose. I think your proposals are necessary, but not sufficient. While they constitute reasonable goals for technology, they fail to address far deeper social and business issues on whose resolution depends the ultimate success or failure of e-commerce. Truth is, we don’t want faster spam, or web advertising banners that are always on and everywhere. Such uses of the Net may be easy for business, but they’re not natural, intelligent, or to be trusted. Those are clearly not the meanings you intended for those terms, but unless business changes its attitude, I think that’s how companies are going to translate what you wrote. Best, Chris ———————————— From: John Patrick To: Christopher Locke: Well Chris, I think we agree on many things even though we may see some of the root causes and solutions differently. We are at the very beginning of something really big. It is going to require a lot of technology and a lot of “attitude” to go to the next level. It may just be that the backlash we saw in 2000 with the business models and profitability of pure Internet companies served as a wake-up call. The pure Internet companies were the pioneers and showed the way; hence the huge initial valuations in spite of no profits. But, once everyone else started following, and started to leverage the Internet, those same companies no longer looked so pioneering. They just looked like bad businesses with no profit. This is why the bubble burst. The good news is that many people who left existing companies to seek gold have returned and brought back a lot of “net attitude” that they learned out on the frontier. We are still in the early stages of the revolution, and much more needs to be done to make the technology highly usable and reliable and to make Web sites meet the expectations of people. I suspect we also agree that there isn’t time for long corporate task forces to study this. Nor for multi-year business process reengineering projects. Consumers and business customers are getting impatient. They know what is possible and they expect it. Time is of the essence. I believe the glass is half full, not half empty. In fact, I believe that the next evolutionary stage of the Internet will be the creation of millions of new e-businesses—from tiny family businesses to giant business-to-consumer companies that have built on their existing infrastructure. However successful b-to-c e-business may become, b-to-b e-business is going to be five to ten times bigger. Meanwhile, behind the scenes, there is something even more profound beginning to develop—a vibrant, multidimensional agora enabled by electronic connections that include consumers, public sector and industrial buyers, suppliers, designers, customer service representatives, and specialists of all kinds. They will all be participants in electronic marketplaces that facilitate information sharing, standards creation, collaboration, and commercial transactions. Yes, we may see some existing brick-and-mortar companies fail—because they studied the Internet too long. However, I believe existing organizations of all kinds have gotten the wake-up call and have leapt to action. Some of the world’s largest retailers, banks, airlines, and electric utility companies are becoming the pace setters. And yes, the NGi will be key to all this, bringing about far more change in the next few years than in the last ten. But I think we both agree that all the technology and money on the planet won’t be adequate. It will be essential to have a “next generation attitude” imbued in management at all levels of the organization—company, university, hospital, or government—so they are prepared to think and act in new ways that meet the rising expectations of people. –John
Gonzo Marketing: Winning Through Worst Practices Locke, Christopher NET ATTITUDE: What It Is, How to Get It and Why Your Company Can’t Survive Without It Patrick, John R. © 1998 – 2001 Borders Online, Inc. All rights reserved.