Buying the new Dell mini laptop and got prompted to sign up for the Dell’s managed services. See if you can top this:

“This service covers your household — all family members and all Dell-branded consumer devices under warranty (excludes purchases from retailers and Employee Purchase Programs). Your call will be answered in 2 minutes or less on average. Request telephone appointments with your favorite team members and receive follow-up from the same team members you talked with!

[add $99/year]“

But wait, an MSP does a lot more than just answer phone calls, even if none can do it for $99/year/PC, especially not 24/7. You also work on infrastructure, help with the system setup, viruses, spyware, etc. Don’t worry, Dell is prepared to kick ass there too:

“We’ve got you covered! If you need help getting started we are here for you 24/7! Dell on Call phone technicians are available around the clock.

On Call Services 30 Days [add $49]

On Call Services 13 months [add $149 or $2/month]

PHONE-BASED SUPPORT TO:

Set Up Your System

Help You Go Wireless

Hook Up Your Email/Internet

Remove Spyware and Virus

Connect Your Gear and More”

Seems like this would be a place to write the eulogy, except there really isn’t much nice stuff that can be said for people that chose to stay at the bottom.

It’s been a rough few weeks for Apple.

First the widespread questions about the 3G handsets quality, which turned out to be an issue with the AT&T network. Looming problems with the quality of the iPhone 2.0 Firmware with crashing applications. Huge security flaw exposing private information at risk if someone gets a hold of your phone even if its locked. More applications pulled from the store sure to anger the users. Being called out for misleading advertising. More user anguish over the censorship of eBooks. This goes on top of the already anxious audience, angry developers and questions of how bad Apple is failing in virtually everything it does. And this doesn’t even touch MobileMe.

Now on the flip side, iPhone (and it’s 3G cousin) are the fastest and best selling smartphone on the market. It is taking clients from other handset makers and other networks at an alarming rate. In the enterprise where Apple doesn’t even have a story to tell the market share has quadrupled from about 1% to 4% and shows no sign of talking a break. It’s competition is fumbling at seemingly all steps: Microsoft has no answer for the iPhone and probably won’t for years - I’m convinced that Microsoft isn’t even looking for one - adopting the same ol’ Apple is not our competition, we give customers choice and our partners design the interfaces that we will steal when they become too powerful. Google for their part is being questioned about the launch time, about handset availability, about pulling features from the new SDK. Microsoft and Google are still struggling to bring together a single working collaboration environment in the cloud, so while MobileMe certainly leaves a lot to be desired it’s miles ahead of where Google and Microsoft want to be in terms of consumers and small business startups.

What really matters?

So in all this fury of triumphs and tragedies, what does really matter?

What does an entrepreneur look to in order to replicate success or avoid pitfalls?

There is the loser talk - success is what you define it, how you look at it and what makes you happy. Bull.

Then there is the reality - success is measured on a balance sheet and how much money you’ve made over how much money you were expected to make.

Is Apple, by all accounts, doing phenomenally better and far more than anyone expects? Is it not coming back from the brink of obscurity in the IT space, showing up in places where nobody expects them? Is it not bending the consumers over on DRM, privacy, reliability, pricing, flexibility and taking in more money than ever thought possible?

It is.

Always, always count the money. That is what business is all about.

… to let someone else change things.

One of the most awesome things that we’ve learned from opening up the development process, the feature requests, bug tracking and shortly even community participation is that we are no longer the change agent. Given that we sink our money, sweat, tears and blood (if you haven’t spilled blood into a gadget or computer you are not in IT) it’s a little unbelievable that we don’t call the shots but really - we don’t - our partners do.

What’s the hardest thing to do? After begging for money and meeting the bills or deciding which projects to scrap? Firing people and making large changes to the structure of the company, offerings, portfolio.

No matter how great or positive the change may be, it will piss someone off.

Not because it hurts them directly, but because they will feel like they have been left out and their input, feelings, thoughts or concerns never made part of the process. It’s one thing to dismiss someone, but to not even ask. That hurts people.

So the lesson in transparency is to involve people in the process. Let them know when they are doing great. Let them know when they suck. Stay open about what is doing well, what is doing terrible, which team members are kicking ass and which ones are just dragging it behind them.

So when things change… they aren’t a shock and nobody is surprised. Prepared, hopefully.

Today’s guest blog post comes courtesy of the page 18-19 of the latest issue of the Harvard Business Review. I think it sounds eerily similar to the attitudes we’re seeing in the IT field these days and felt it was relevant enough, so here it is for your consideration. Enjoy:

History has lessons to teach about the role of denial in the decline of companies. The stubborn refusal of the U.S. automobile industry to admit changeability of consumer demand is one of the best examples.

The Model T was introduced in 1908, and over the next two decades the Ford Motor Company sold more than 15 million of these cars. But by 1927 sales had flagged so severely that Henry Ford discontinued the line in order to retool his factories for its successor, the Model A. To make the change, he shut down production for months, at a cost of close to $250 million. This chain of events was disastrous for the company, because it allowed Chrysler’s Plymouth to gain market share and permitted General Motors to seize market leadership.

Why did Henry Ford, who was such a visionary in the industry’s infancy, fail to see that the Model T was about to run its course and that a smooth transition to a new vehicle was essential? Evidence of his signature model’s declining fortunes was everywhere apparent at the time. But Ford dismissed sales figures documenting the Model T’s declining market share, because he suspected rivals of manipulating them. One of his top executives warned him of the dire situation in a detailed memorandum. Ford fired him.

Ford’s blindness resulted from a conviction that he knew what customers wanted: basic transportation. He was equally convinced that this desire would never change. His favorite slogan about the Model T- “It takes you there and it brings you back” - captured his myopic view. What Ford didn’t grasp is that every product or service has two components: the core (the product’s primary purpose) and the augmented (additional functions and features). In every industry the border between the two inevitably shifts over time. (For another take on Core and augmented products, see Theodore Levitt’s The Marketing Imagination)

In 1908 the automobile was mostly core: It got you there and back again.

By the 1920s, however, the world was changing, whereas the Model T wasn’t.

The full piece is well worth the time to read it (and the magazine’s $20 newsstand price) and is written by Richard S. Tedlow, rtedlow@hbs.edu

And yes, I read the Harvard Business Review - as should you.

Geek Squad Dave first gained notoriety in the newsgroups for his very public lack of ability to grasp the basic concepts of vendor and client management and dealing with cost structure changes. After being condemned in public by most of his peers Geek Squad Dave became only the second person OWN will not do business with, which has apparently motivated him to become an unofficial spokesperson for one of our customer-direct competitors where he hopes to lead the drones of retail consulting IT failures like him - and god do I wish he succeeds. He also appears to be preoccupied with me for some reason even though I don’t remember ever meeting the guy. Here is his latest bit of “brilliance”:

I’ve been in this industry since Vlad was in diapers and I can assure
you the WAN bandwidth is always going to be behind LAN bandwidth. And that as bandwidth increases, the apps and data will too.

This is a part of the Geek Squad Dave’s argument on why most applications will just never make it to the cloud. Now, for this to work I am going to need you to ignore a few things. The last time I was in diapers was about 28 years ago or so.. so please ignore for a moment that this genius comes from a man who has been virtually unemployed for that period of time and failed to even accidentally be successful enough to hire another person. Please also ignore the flawed logic of “this has failed before, so it will surely fail again.” Also ignore the billions of dollars being pumped into the transformation of IT infrastructure by every major vendor. Let’s also ignore the wisdom of people who work with network engineers, developers, major IT powerhouses all of which are indicating that this is the direction they are strongly focusing on. That’s just how much ignorance you’ll need to think that we are not on a cusp of the most significant change in computing during most of our lifetime. Pampers stage included.

You see, for the longest time we’ve had this shift of computing and processing power from mainframe to PC, from PC to server, from server to workstation and the trend always flowed to the device with the most computational power because that is what transformed data into something useful. But over the last few years we have seen the relevance of a local area network diminish. Change in paradigm? Change in trust? Change in cost and affordability? It doesn’t really matter why, it matters that the computing experience is no longer dependant on you being a part of some segmented network that needed to be managed, monitored, tuned and audited around the clock. Your phone accesses the same Internet. It sends around the same email. It provides similar services, often better and more reliable if at times even cheaper. Ever tried to print a picture across the Internet and pick it up at a local CVS? Or have a picture book shipped to your doorstep?

The large data set argument is the last one in the defense of the local area network and is by far the most flawed of them all. If the data set grows, the processing power needed to manipulate it grows. Major movie studios do not render their movies on expensive standalone SGI’s anymore - they render them on server render farms. Major database and transaction systems no longer sit on monolithic clusters fighting a storage medium bottleneck - you’ve guessed it, data farms. Large files, voice, video - all within the reach of your cell phone powered by a tiny battery.

Welcome to the future. (PDC ‘08 Sessions)

As the cloud computing becomes more prevalent medium for long term storage, processing, scalability and affordability, what unique feature will bring computing back to the confines of the LAN? That my friends is what is crushing guys like Geek Squad Dave right out of their almost-business, the inability to deal with change combined with lack of expertise to seize the opportunity. It is what separates IT solution providers from independent Geek Squad guys running out and “trust recommending” the solutions. One provides solutions, the other picks out laptop bags and offers input on which version of Quickbooks or Office you should buy. The successful IT solution providers of today and tomorrow are the ones who stay informed and can demonstrate the ability to help a business be successful in the modern times.

The opportunity is incredible. And the only requirement is shedding the ignorance.

This is the most exciting time to be in the IT space, bar none. And if you think you’ve seen this before… your mind is starting to go, a good indication that you’re closer to diapers than I am.

Yesterday was a slow day, with all the 1st of the month stuff wrapped up people tend to sit back, refocus, adjust their appointments and plan for the week ahead so Monday morning doesn’t start on a bad note. It’s also time when we look at what others in the company are doing, developers look at support, support looks at ops and facilities it’s all a part of oiling the machine. At some point in the afternoon I get an IM:

Stamantha says:

Why is Sheldon updating tickets? I have him on vacation this week.

Now, what I’m about to share with you is not in any self-help book, HR guide, socialist pamphlet or Islamic fatwa. Perhaps it should be. Ready?

There is no award for doing your job.

There is no award for doing what you’re expected to. Meeting expectations is.. well.. a requirement to remain employed. If you sit on that line you will be the first one gone. Hate to break it down like that but it’s the truth. People who do the bare minimum do not get promoted, they do not get raises, they do not get bonuses.

Same goes for delivering services. If you simply do what you said you would do you’ve earned your pay. Nothing more. If the five people around you are doing the same but also picking up the slack, documenting their work, contacting the customer for courtesy followups, managing their schedule and their customers demands.. well, those people get more money.

Somewhere between stupidity (working harder than those around you) and insanity (knowingly working harder knowing that no raise or bonus is guaranteed) there is a little thing called work ethic and that is what elevates the excellence of the team, the company and the solutions we deliver. If that sounds like Dilbert’s pointy haired boss saying our people are our greatest asset then I’ve hit my mark, because…

… because for the most part that whole thing is total bs that companies give their employees to keep them under delusion of future for just one more day. Efficient and flexible companies are not built on psych profilers, blank incentives and meaningless perks. Employees are not motivated by a shocky stick and a output measure every 60 minutes. Companies driven in such a way guarantee only one thing: that your employees will only do the bare minimum required to get to the next step, and they will resent you when they do the bare minimum for the next step and do not receive the anticipated result. Those folks are not on the same mission you are, if that is how you value your people, in an inverse proportion (the less I pay you, the more I make) then your employees will work the same way (the less I work the less stressed I will be and I will be happier)

Companies are built by example. Define goals, define requirements, define the effort required and then publicly reward the people that align themselves with your mission. Reward them publicly and excessively - you will find more of your people taking the same path.

Companies are built by leadership. Why are people working on vacation? Why are they looking at their case work after hours or getting stuff done whenever they get a chance? Because they see me do it. We are on the same page. I don’t jump into a room, smack a deadline on the wall and say “We’re going to get this done - Oh by the way, I’ll be in Hawaii next week, please try not to bother me.” This is not a Michael Jordan commercial, this is the truth about the American enterprise - if you are any kind of a leader people will follow you and try to be like you. So why not give the best possible example of working towards the common goal?

Companies are built with hard work. This doesn’t go without saying, it has to be said: If this stuff were easy everyone would do it and we’d be making minimum wage. But it’s not, and for us to stay where we are and get even better we need to work hard. We are not in this to just manage, to get by, to slide, to coast, to barely register. We are in this to be the best and it’s not easy.

So back to the question, why is Sheldon working while he is on vacation? Maybe he is a fool. Or maybe he understands what we are all about and is dedicated to the same goals that we’re all dedicated to. That’s not something you can profile, thats not something you can influence with the minimalist salary baits for incremental improvement..  That is something you establish by example, leadership and hard work.

For years Dell lead the way of ugly PC manufacturing. Their claim to fame has been the cheapest and most generic PC on the planet, delivered to your doorstep in any variation of ugly you want.

Beige, duotone silver, black did not matter in the rainbow of ugly because the competitive matrix was between price and performance and Dell had solutions in all the corners.

But then a funny thing happened.

Little fruit company out of Curpentino started making flashy computers that did pretty much what Dell’s solutions did. The little fruit company grew from obscure single digit percentage to being the third largest shipper of personal computers in America.

Suddenly, Dell could not grow its business and grow its margins. Suddenly things like design became important. Green became important. Style became relevant.

Dell was no longer just another fish in the ugly pond. It did what all the great companies do when they get told they simply aren’t keeping up with the marketing expectations.

It evolved.

Dell didn’t roam the desert for subjects to trick into thinking they are better than the market tells them they are.

Dell didn’t turn and say that it simply didn’t compete with pretty and flashy.

Dell didn’t sit back and choose to fight with the same tools it has used to get to the top, they completely redid their product line, changed their values.

Dell reinvented itself.

Little lesson for all of us. It doesn’t matter if we think we are right. It doesn’t matter what the perception is or who is causing the disruption.

What matters is listening to the clients, to the line of people lining up around the door to give us their money, and making sure we satisfy them.

There are parts of business I truly hate, one of those being collecting money.

Yeah, I know, as a CEO I’m supposed to be taking the balance of accounts receivable every month and exchanging it for quarters and nickels and dimes to fill my money bin so I can swim in it like Scrooge McDuck.

Alas, it’s not that pretty.

It’s more like going through the endless list of ignored invoices, expired credit cards, moody credit card transaction processors and processing rules, fee adjustments and other fun stuff.

Every 2nd day to the end of the month we do the same shaking the money tree routine and frankly it ruins my day. Why? Because every month there is some schmuck that refuses to pay an invoice for the service that he isn’t using. Even while using the said service to send us an angry email telling us that he isn’t using it.

I refuse to pay for ExchangeDefender, we cancelled months ago!!!!!

ExchangeDefender Message Security: Check Authenticity

Argh!

I feel like a mafia kingpin on the 30th.

I’m making phone calls asking where the check for protection is at.

You gonna pay for your antispam or am I gonna have to break some kneecaps?

No, I will not barter offsite backup fees for rum, it be gold I’m after!

Where my money at……

Anyone been terribly successful with hiring collections staff that would like to share a way to build a business that collects reliably and doesn’t annoy or beat down its customers in the process?

Summer months tend to be dead for us, and with the tougher economy out there I’m checking our KPI’s every day to see dip in either services or subscriptions. As bad as things seem, we going to have our strongest month on the books even for god knows what month in a row and with Shockey Monkey 2.0 and ExchangeDefender 4.0 online launching in August things are looking remarkably good indeed.

So why the paranoia? The bottom of the market is eroding. That’s about as politely as I can put it. The SPFs have long disappeared and riff-raff is on it’s way out as well. As I have written many times, with very very very few exceptions, being small is rarely a choice. It reflects in the service dropoffs and client quality of the bottom tiers as the service losses aren’t to a competitor of ours (Postini, MessageLabs) but back to the server or more commonly just null routing (as in company gone). And as the bottom client base disappears, so do the solution providers. We’re seeing a lot of people teaming up with other smaller IT shops but by far and large most people are out getting jobs.

That in a nutshell is my greatest going concern with OWN. We have worked very, very hard to leave SMB and count on our partners but not a day goes by that we do not get a former partner account call in direct and say that their consultant simply vanished. This forces our hand - if we cannot find a partner to refer to, we have to decline and lose a client to retail-based services organization. There is some talk here of providing direct support though I am not sure how we can figure out the numbers for level 1 staff around the clock and maintain our service levels where they are. So that’s a problem.

 So far we haven’t figured it out. Smallbiz disappearance is something that I’ve written here at length, much to the dismay of many of the people that self-identified with the SPF term I coined a long time ago watching the MAPS resellers at TS2 events that called themselves consultants. But apparently the choice to focus on small business for a lot of the shops we work with has been a wrong one. When you are small you cannot reach a significant diversity in the verticals, and most of the time geographic bounds are insurmountable (though I know a lot of people that will fly around the country to service all the branches) so if you are bringing in $50 - $75K a year you’ve got a pretty good life, but when one or two out of ten clients go south and your cost of doing business skyrockets you are facing pressure on margins as well as account loss. So much for a lifestyle, eh? I had a guy call me last week and lay out his “lifestyle” business plan and his challenges… and I felt like crap because there was just nothing I could tell him. I have degrees in business and engineering, I’m programmed to seek diversity, grow and solve problems. What this guy saw as his competitive advantage is turning out to be an Achilles heel to a lot of partners who in a tough economy have to face reality, partner up with the others in the marketplace and take a good look at their business processes and reevaluate direction. From talking to a number of them, it seems looking at the EBS/SBS launch didn’t quite resonate with their clients and they figured they could make more money working for someone else.

As for us, we keep putting more money in talent, equipment and services and people are lining up around the building to sign up. Remarkable growth with ExchangeDefender which with 4.0 enhancements will pretty much decimate everything else on the market (thats just my unbiased opinion), the offsite backup business is growing insanely and with 5.5’s addition of continuous data protection available now and hardware independant restores expected around Thanksgiving, with the global demand for Exchange+SharePoint $10/10GB combo.. our biggest issue is finding a direct compromise and how to deal with the small business partner attrition. I wish it was as simple as if ($revenue > $level1_support_salary) count_de_money();

Advice? You know the #….

You have never been in charge of data center ops if you have never turned to your staff and said: “Can we just burn all this s#it and start over?”

What a messed up day. Everything crashed today. Including a Linux server that has been up and running for over 500 days without a restart. Everything from a $399 server to servers with $399 network controllers.

And then people look at me sideways when I say we will not support EBS/SBS. I will no longer approve purchases and deployment of single point of failure solutions. It’s 20-fn-08, overpowered hardware is dirt cheap and we are designing infrastructure like we just got out of the great depression and are trolling up and down the L looking for coal rocks to trade for parts. Come on, who needs this stress!!!

Drinking it away at Chillis and blogging from my iPod.