Mark Sigal's Blog - The Network Garden

Upward Mobility, Land Grabs and the iPhone Universe

If for no other reason than to plan around their patent filings, it is impossible for me not to stop and look at the implications of the location-based services model Apple is envisioning for the iPhone Universe.

Brilliant vision.  Very clear value proposition.  And earnestly thought through (in my opinion). 

Do yourself a favor.  Dive deeper and check out the must-read article, ‘Apple filing places iPhone networks at restaurants, zoos, concerts,’ at AppleInsider.

Here is an excerpt:

The concept calls for a short-range wireless network that merchants or attraction organizers could install within their venues. Included in the network would be an "iPhone server" capable of interfacing and serving up customized information and applications to Apple media devices that come within range of the network.

The details of the patent filing lay out some clear application and service patterns. Here is one specific example from the filing (there are several):

"Various location-based content that may be provided in connection with a merchant that sells goods and articles of manufacture. For example, a user may access music (e.g., being freely broadcast by the establishment or for sale on content source), advertisements (e.g., coupon specials, video advertisements, and audio advertisements), event calendar (e.g., to learn of exciting new events that may be occurring at the merchant), virtual card information may be exchanged, podcast, general information on merchant (e.g., return policies), product information (e.g., graphics of products, reviews of products, etc.), or any other suitable information pertinent to the merchant."

Given that Apple has already worked through the logistics chain of pushing apps and media items to devices, including purchasing and transaction processing, there is little doubt that such context-rich services are well within reach of the platform.

At the same time, the breadth/depth of these filings also forces you/me to wonder what the end-goal is in carving out patent real estate in so many of the application spaces relevant to the iPhone Universe.

Is it a land grab and attempt to create (patent) toll roads throughout iPhone Universe or just protection against a would-be competitor outflanking Apple and establishing barriers against them and their developer ecosystem?

Perception has a way of becoming reality so let me state the obvious.  It is incumbent upon Apple to be perceived as magic creators and marketplace enablers, and NOT land barons.

Let me suggest that one path to protecting all sides is to grant a fairly broad usage license to this patent portfolio to developers  (and even competitors) subject to a reasonably crafted, bi-lateral Covenant Not To Sue (CNTS) clause.

Essentially, a CNTS allows Apple to do its thing and expand into segments that it views as strategic without having to worry about the ecosystem that it creates turning and suing it one day. 

At the same time, it also lets developers do their thing without having to worry that Apple might one day turn predatory.

If the larger goal is to become ubiquitous and gain immutable brand ubiquity by winning the hearts and minds of consumers, developers and services providers,  formally granting broad usage rights to its rapidly growing iPhone Universe patent portfolio is the consummate WIN-WIN.

Related posts:

1. The Scorpion, the Frog and the iPhone SDK: on Apple's mixed history with developers and partners.
2. iPhone SDK: Mobile Reasons for Optimism: why the iPhone Universe is a big deal.
3. Holy Shit! Apple's Halo Effect: how Apple has turned gravity into its friend.

Presentation Logic: Don't bring attention to your mistakes

Years ago, I took a public speaking class.  One of the best nuggets that I gleaned from it (beyond the extemporaneous speaking methodology) was the importance of not spotlighting your mistakes when making a presentation.

It is akin to self-sabotage, and readily avoidable by simply being aware and NOT acting on a knee-jerk impulse.

Let me frame the AHA moment for you.  A core part of the class was having weekly presentations in front of your peers.  These presentations were filmed for subsequent review by you, your classmates and the instructor outside the heat/angst of the moment.

During rehearsal for my second presentation, I felt reasonably crisp about what I wanted to say and in what order. 

Unfortunately, when I got up on stage, during one of the transition points I lost my place and stumbled. 

In what seemed like an eternity, there was deafening silence as my peers' eyes conveyed both pain at seeing my struggles and wonderment when I was going to get back on track.

As it was "obvious" that I was crashing and burning, I finally acknowledged to the audience that I had lost my place, and after a moment, did indeed get back on track.  But the damage was clearly done.

Or was it?  Upon review of the tape, another reality became clear.  While my perception of struggle and confusion was palpable, in watching the tape, the ONLY clear indicator that I had lost my place was the moment that I specifically called out that I had lost my place. 

Sure, things could have been a bit tighter, and I certainly could tell what was going on under the surface, but in absence of MY bringing attention to the miscue, had I simply breathed and momentarily paused until I got back on track, no one would have noticed that I had lost my place.

The moral of the story is that your audience rarely puts every nuance of your presentation under the microscope, and this allows you to back out of dead ends, correct mistakes and generally massage your presentation into shape -- in real time.

Human nature in these situations, however, is to put yourself under the microscope and call out mistakes as the occur.  You do yourself and your audience a disservice when you spotlight such mistakes, as my experience underscores.

One final comment on this topic.  It amazes me how many people walk into important meetings and presentations without formally documenting or practicing what they want to say and/or codifying what outcome they want out of the meeting. 

As someone once said, luck is what happens when opportunity meets preparedness.  Mixing metaphors a bit, if an once of prevention can be said to be worth a pound of cure, then an ounce of PREPARATION is worth at least a pound of good luck.  Food for thought.

The Five Keys to Business Success

I am a big believer of chronicling best practices and lessons learned in the field of entrepreneurialism. 

Why? Because fundamental truths, when they reveal themselves, can save you from painful dead-end paths, minimize the time you spend re-creating the wheel and generally translate to a higher probably of success – regardless of industry, stage of business or outcome goals.

The paradox, however, is that there are so many nuggets that one encounters over time, across companies and at different milestones of a business that sometimes the real challenge is to just keep things simple enough to be manageable.

By that, I mean that the definition of the situation can be clearly and consistently communicated to all members of your constituency audience (which includes customers, partners, investors and employees).

Put another way, as my Bikram yoga teacher likes to say, “If you come across two philosophy books, one thin and the other thick, choose the thin one, as the author of the thick one still has more work to do.”

With that in mind, the five most important drivers that I have found to entrepreneurial success are:

1. Embrace Specifics: the company culture is to sweat the details (and document them) about the target customer, use cases, product requirements, development schedules, customer support assumptions, business models, market penetration strategy and the competitive landscape.
2. Be Reality Driven: the team is intellectually honest about the definition of the situation and strives to create clear metrics and measure actual performance relative to stated goals to objectively prove out the core assertions of the business.
3. Reconcile Paradoxes: there is an understanding and intellectual accommodation of the fact that the path to business success is replete with short-term versus long-term trade-offs, most notably conflicting agendas between your constituent base.
4. Practice Clock Management: the plan of record is based on a fundamental alignment on how much time is allocated to achieve specific milestones, the available resources, especially cash, to achieve those milestones and fall-back options if goals are not timely met.
5. Mentally Tough Hires: the foundation of the team is built around a core that can cope with the highs, lows and uncertainties that are endemic to the entrepreneurial process.

Are there other essential truths that you see as missing? How do you perform relative to the above keys to success?

Related Posts:

1. Core concepts learned doing seven startups.
2. My blog post, "On Intellectual Honesty."
3. What is Bikram Yoga (10 years of practice and counting)?

Never let them see Oz: Sell the Magic

Have you ever been to a great restaurant where the waiter proudly told you that their signature fish dish was inspired by a comparable dish at the restaurant down the block? 

Can you imagine the fashion designer, Giorgio Armani, telling attendees of his latest fashion show that the $15,000 gown they just saw modeled on the runway is just cotton fabric assembled by low-wage workers in a third-world country? 

Would you appreciate/value that food dish or designer fashion item more or less if they told you this upfront?

These are rhetorical questions, but they speak to the importance of recognizing that while reality may be inspired by looking at this competitor, talking to those customers, or finessing and iterating a so-so idea until its implementation is pure brilliance, never forget that you want the customer feeling that what you do is MAGIC (albeit, with a little SCIENCE perhaps). 

This may be a little unnatural when you first present things this way to customers, partners or even co-workers, but it is suggestive of the importance of selling a vision, speaking to an operational discipline and driving your target audience to a specific experiential place. 

Life is messy.  We often grope our way to success.  Pure luck and serendipity often enter the equation, as does simple asserting, watching and listening.

But remember, while these statements are borne of reality, there is another reality; namely, that customers don’t want to see the man behind the curtain.  They want to be entertained and amazed.

Don’t let them down.

See also:

1. My blog post on 'the assertion-based reasoning model.'

Holy Shit! Apple’s Halo Effect

Churning through the analysis of Apple’s earnings call yesterday, there was one bit of data that evoked a “Holy Shit!” moment. 

The data pertained to year-over year Mac sales, and the fact that they are up 51% this year compared to last - a rate of growth that is 3.5X better than the PC industry. 

Think about that one for a moment, and what it means to Apple’s execution of their strategy. 

On the one hand, it is tempting to caveat this data by noting that Apple is growing from a relatively tiny base of the PC market (they have a six percent market share). 

But, the fundamental truth of the matter is that growth is growth, and the bigger the ripple, the bigger the wake. 

Even more, when that ripple is GOOD GROWTH (i.e., high margins, product differentiation, customer lock-in/leverage via multi product buys, Apple's penetration into real and virtual sales channels), look out as true ‘halo effects’ start to play out that are self-affirming (i.e., success in one area feeds success in another).

In other words, the more the Mac business grows, the more gravity becomes Apple’s friend in mobile, media, online services and the like.  And vice-versa (growth in those areas drives people to buy Macs). 

This got me thinking about the fundamental TREND BETS that Apple made and has executed on.  Why?  When you can get in front of the right trends and actually execute, gravity has a strange way of becoming your friend. 

I would summarize these trend bets as follows:

1. Make mobile Internet caveat-free. EXPLANATION: Before iPhone, mobile Internet was the proverbial dog walking on its hind legs.  Impressive that it could be done at all but not compelling.  No more.
2. Rich media is the ‘MY STUFF’ bucket that matters.  EXPLANATION: What we personalize, choose to listen to, watch, save or digitize is what we keep.  As a result of this fact, iPod (and now iPhone) have established a hard to emulate position as part of our online DNA, and this can be grown into all sorts of interesting product directions.
3. Everything is a platform.  EXPLANATION: Having specific methods for extending and integrating your offerings, as well as providing tools that enable an ecosystem to coalesce around your platform trains customers that investments today will be rewarded in spades over time, creating customer loyalty and enabling high margins.  This used to be Microsoft 101 (before they started chasing Yahoo’ish windmills to Vistas unknown), but now it's Apple’s domain (read: iPod and the music industry; iPhone and mobile carriers; and soon, iPhone SDK).
4. Everything is integrated from device to PC to online service.  EXPLANATION:  When you have the ability to look at an application as the optimal composite of what a general-purpose PC does well, combined with what a highly specialized iPod/iPhone/Apple TV does well and can weave in the dynamism of online services, you can operate in three dimensions, which is a beautiful thing.  When you are adept at things like workflow and usability, as Apple is, it is breathtaking; a game-changer.
5. Everything is derivative.  EXPLANATION:  Understanding the different “jobs” that customers hire your products for and segmenting your offerings accordingly enables you to provide optimized solutions while maximizing leverage.  This, in turn, enables domination of specific segments while delivering the economy of scale needed to build high margins.  The latest wrinkle to this is that Apple is starting to get good at taking innovations from one product (e.g., Multi-Touch on iPhone) and baking it into others (Multi-Touch on MacBook Air).  Cross-pollination in an innovative company like Apple bears all sorts of unanticipated fruits.

Now if only Apple can figure out how to get in front of the social media/social networking trend, my Facebook page might start to hyperventilate.  :-)

Related Links:

1. Gone Indie: an excellent post by an ex Apple engineer both affirming what makes Apple great and why it was time to leave.  Also, supports my comment on Apple being slow on social networking uptake.  His post was written some time back so not suggesting our comments influenced one another just connecting dots from an Apple insider to an Apple outsider (me).
2. Valleywag: On BusinessWeek story indicating that out of 250 surveyed companies, 87 percent report owning Apple computers. That's up from 48 percent in 2006.

Envisioning the Social Map-lication

eMarketer predicts that the number of people who create "user-generated" content will rise from 77 million in 2007 to 108 million in 2012.

On the one hand, that is a big number.  On the other, this is the information age, and the Internet is a two-way media so it makes sense that this increasingly becomes a medium where we both consume AND generate/create content.

Towards that end, it also seems logical that applications will emerge that help us take a more unified approach to organizing, managing and publishing our profusion of posts, pictures, videos, comments, tracked discussion threads, playlists and profiles.

Some people think of this bucket as a social map, the amalgam of social media, our network of connections and online breadcrumb paths.

Recently, on GigaOM, I wrote a guest column that expands on the concept of social maps, and envisions some application kernels that support it.

Here is an excerpt from the post:

Isn’t this the moral of the story regarding iTunes, iPhoto and the iPod/iPhone? Namely, that whether blogging, YouTube’ing, Flickr’ing, Digg’ing or tweet’ing, the “forever” bucket is the bucket consisting of my content, my contacts, my contexts and my conversations.

This suggests that regardless of where any of these informational breadcrumbs may originate, each of us needs to think of ourselves as the center of our respective social map universes. In other words, the social map — in order for it to be considered a map – needs to systematically connect the dots between me, my content and my network. A map-lication of sorts.

Check out the full post HERE.

Social Media Marketing: What does it mean to me?

In conjunction with ad:tech San Francisco, which is going on right now, my company, vSocial, is running a microsite called The Answer where consumers can upload a video or picture and description of what social media marketing means to them.

Here is my video.

Related Posts:

1. Online community building: three critical ingredients
2. Vespa Go Green Campaign and Interactive Agencies
3. Don’t Subordinate your Brand
4. Social Media: it's about Breadcrumbs and Conversations

'Whaling': Larger Prey As Targets of Phishing Scams

You receive an email message appearing to be an official subpoena from the United States District Court in San Diego.

Visually, the message looks official, includes your name, company name and phone number, and commands the recipient to appear before a grand jury in a civil case.

What do you do?

Unlike most e-mail phishing scams, this one passes the sniff test.  “I think that it was well done in terms of something people would feel compelled to respond to,” said Steve Kirsch, the chief executive of Abaca, an antispam company based in San Jose, Calif, and a recipient of one of the 'subpoenas'. “Even the U.R.L. to find out more looked legitimate at first glance.”

Clicking on the link embedded in the message (which purports to offer a copy of the entire subpoena) results in the recipient who tries to view the document unwittingly downloading and installing software that secretly records keystrokes and sends the data to a remote computer over the Internet. This lets the criminals capture passwords and other personal or corporate information.

Scary stuff specifically because it does pass the sniff test, and according to the New York Times article spotlighting this, well targeted too (whaling is a play on the phishing term):

Thousands of high-ranking executives across the country have been receiving e-mail messages this week that appear to be official subpoenas from the United States District Court in San Diego. Each message includes the executive’s name, company and phone number, and commands the recipient to appear before a grand jury in a civil case.

Several security researchers said that the real danger of the attack lay in a second level of deception, after the hidden software provided the attackers with digital credentials like passwords and electronic certificates.

Despite the seemingly easy-to-trace domain name, the feds guess this originates from China, and as such will be hard to stop.

Membership has its privileges, I guess.  Welcome to the underbelly of the global economy.

Life's Lessons: Let others pull you higher

Life is hard enough. Whenever you can leverage others to make gravity your friend, you should try to do so.

Yet, too often the mental tape plays, "I can do it myself."  Or, control dramas kick in and you think, "I want to do it MY way."  Sometimes, it's pride chiming in with, "I don’t want to appear weak." 

Recognize these psychic utterances as discursive thoughts.  There is no special award for solitary accomplishments, and there will be plenty of days when the road ahead will be lonely. 

Take comfort in the strength of others.

Staring into the Abyss: What Really Matters

There is a Buddhist axiom about Crazy Wisdom. Sometimes from standing on the edge and staring into the abyss, there is a moment of clarity and understanding.

From this place, catharsis can occur, new muscles can flex and the bearer can find themselves able to carve wholly new paths that heretofore were sight unseen.

What brings me to this sensibility are two articles.  One, a post written by my friend, Om Malik (of GigaOM), codifying lessons learned in the past 90 days since his heart attack. 

The other, a recent article by Randy Pausch, a professor at Carnegie Mellon University, who is dying of pancreatic cancer.  The article summarizes his ‘final lecture’ about what really matters in life.

Hopefully, none of us will have to find ourselves on such a finite dead-end road before we get clarity on what matters to us most in life; but, with that perspective in mind, put yourself in Randy’s shoes for a moment, and consider what HE considers the indispensable truths of live. 

(The video from the lecture is below this summary, and a link to the full article is HERE.)

Always Have Fun
I came to an early realization. Each of us must make a decision, best captured in A.A. Milne’s Winnie-the-Pooh characters. Am I a fun-loving Tigger or a sad-sack Eeyore? It’s clear where I stand.

Dream Big
Give yourself permission to dream. Fuel your kids’ dreams too. Once in a while, that might even mean letting them stay up past their bedtimes.

Ask for What You Want
Ask. More often than you’d suspect, the answer you’ll get is, “Sure.”

Dare To Take a Risk
Experience is what you get when you don’t get what you wanted. And it can be the most valuable thing you have to offer.

Look for the Best In Everybody
I got this advice from Jon Snoddy, my hero at Disney Imagineering. “If you wait long enough,” he said, “people will surprise and impress you.” When you’re frustrated with people, when you’re angry, it may be because you haven’t given them enough time. Jon warned that this took great patience, even years. “In the end,” he said, “people will show you their good side. Just keep waiting. It will come out.”

Make Time for What Matters
Time is all you have. And you may find one day that you have less than you think.

Let Kids Be Themselves
My job is to help my kids foster a joy for life and develop the tools to fulfill their own wishes. My wishes for them are very exact and, given that I won’t be there, I want to be clear: Kids, don’t try to figure out what I wanted you to become. I want you to become what you want to become. And I want you to feel as if I am there with you, whatever path you choose.

Sub $200 Wi-Fi Touchscreen iPods by Fall?

AppleInsider is reporting that Investment bank Piper Jaffray expects Apple to release new Wi-Fi enabled, touchscreen iPods in the sub-$200 range by September. 

Yowza!  Talk about mainstream, entry-level price point.

The PJ analyst goes further, noting, “In fact, we believe the concept of the iPod will change in the next 12-18 months from a standalone music player to a mobile Internet device that fits in your pocket."

Two quick comments to this story. One is that beyond the obvious top line objectives to keep growing the iPod business, this is as much about converting the 100M iPod base into the iPhone SDK-powered platform.

Apple can generate serious coin by wooing developers to build apps if the reach of the platform is 100M devices. They can secure a big time halo effect for their Mac business by increasing the integration and leverage between these devices and the Mac. And they can extend their reach into other segments and device form factors if they pull this off.

Two is that beyond the potential market segmenting confusion as price and functionality lines blur between iPhone and iPod touch, they already have branding and messaging challenges.

The platform is called iPhone SDK but if they execute, there will be as many if not more of these devices running on iPod touch (as iPhones).

It is a mouthful to have to write every reference as 'runs on iPhone and iPod touch devices' and it is certainly less crisp, which limits the effectiveness of marketing messages that leverage viral, word of mouth strategies.

Here is a link to the full article.

Related posts:

1. Mobile Reasons for Optimism: The iPhone SDK
2. Mobility Lives! The iPhone SDK looks awesome
3. iPod touch: the first mainstream Wi-Fi mobile platform?

Obama, Clinton and the 'Winner Take All'

While Republicans have long understood the WINNER TAKE ALL nature of presidential elections, Democrats have tended to feel 'dirty' about the dog fight-like nature of process, and fought lamely as a result.

This has yielded vanilla candidate after vanilla candidate (think: Dukakis, Gore, Mondale, Kerry), and defeat after defeat (save for two-time heavyweight champion, Bill Clinton).

With that as a backdrop, some sage clarity  and exposition from Maureen O'Dowd in today's New York Times:

One of the most valuable lessons the gritty Hillary can teach the languid Obama — and the timid Democrats — is that the whole point of a presidential race is to win.

It’s not to share power, or force the squabbling couple into an arranged marriage.

The winner wins, even if it’s only by a fraction of a percentage point or one Supreme Court justice.

Winning has no margin of error, as the Democrats should have learned by now. And the winner gets to decide his or her running mate.

Read the full article HERE.  It is extremely crisp and well articulated.

The ‘VC-tested’ CEO Scorecard

So you want to be a CEO, raise millions of dollars and take your company to the ‘liquidity event’ promised land?

Well, this CEO Scorecard, which was provided to me by a first tier VC, and friend of mine, will help you get started (or keep your job, if you are already in the CEO hot seat).

What follows are the criteria items on the scorecard:

1. Meets or exceeds plan 
2. Identifies/upgrades management on a timely basis 
3. Recruits world-class people; does not under hire 
4. Keeps company and team focused 
5. Has respect of executive team and employees 
6. CEO level selling, does the big deals 
7. Crisp, fast decision-making 
8. Anticipates financings and executes a strategy 
9. Cost/Expense control and cash management 
10. Articulates the vision internally and externally 
11. Honestly and Objectively Assesses the Company status 
12. Seen as an industry leader/leading company 
13. Communicates well with the board 
14. Available and allows board level access to the exec team 
15. Effective at partnering 
16. Appropriate focus on technology and new products 
17. Focus on building shareholder value 
18. Thinks globally 
19. Crisp, on time preparation of annual operating plan 
20. Business has appropriate metrics/dashboard

This particular VC maintains a spreadsheet with each of the fields ranked on a scale of 1-5 and color-coded “GREEN,” “YELLOW” or “RED” so visually there is no confusion how you are doing in a given area, and your cumulative scores are re-rated after each board meeting.

Thus, scores are easy to track over time and can be compared to the performance of other CEOs in the firm’s portfolio. 

Ala my recent post on the Three Steps on the Path to Success, the CEO Scorecard has the benefit that it is SPECIFIC, is easy to COMMUNICATE and provides a mechanism to COORDINATE going forward expectations relative to current and past performance levels.

Three Steps on the Path to Success

Because I continually see really good people struggling to realize their personal goals...

Because I continually encounter dedicated entrepreneurs struggling to achieve their business objectives...

Let me suggest three simple steps to getting on the path to success:

STEP ONE: Be SPECIFIC about the details of your plan.  I can not underscore how much confusion and outright failure is the simple by-product of having fuzzy objectives whose very existence lies undocumented in any form.

STEP TWO: Clearly COMMUNICATE roles, expected deliverables, key milestones and timelines.  So often a plan is dependent upon the actions of others, yet the very same constituency is left to guess or interpret what is expected of them.

STEP THREE: Hope is not a strategy.  Therefore, you have to regularly and proactively COORDINATE with stakeholders on the status of their deliverables and develop contingency plans when they are missed. 

A final disclaimer.  There is a tendency to cast even the most simple of goals into the bucket of all or none.  In truth, the process of 'documenting' the specifics need not be monolithic. 

It can be a page or two, a checklist or a wiki or even a continually evolving PowerPoint presentation.

For that matter, coordination can result from scheduling regular demos or aligning on specific release themes and/or use cases.  There is no one right answer.

In fact, while process matters it is ultimately subordinate to prioritization.  When something is a priority, process follows.  When it is not, no amount of process will yield the desired results.

Necessity is truly the mother of invention in this regard.

Think about that the next time you are staring at a fork in the road.

Chaos, Order and Target’s Inner Circle

By refusing to submit to the tyranny of the ‘all or known’ syndrome, devotees of chaordic systems willingly and enthusiastically embrace the paradox that exists between chaos and order. 

To be sure, the ‘AND’ dance (as I call it) is a dance on the razor’s edge.  On one side, is compelling uniqueness and breakout success. 

On the other, lies the crushing weight of trying to be all things to all people, ultimately representing nothing.

With these bifocaled lens as the backdrop, read ‘Target’s Inner Circle,’ an excellent article on discount retailer, Target, in this month’s Fortune Magazine.

Target is a company that in so many ways embraces the paradox between chaos and chaos.  Its corporate motto, ‘Expect more, pay less,’ is the quintessence of the mass/class bifurcation, a discounter that nonetheless encourages budget-constrained consumers to aspire for good quality, brand names and designer touches.  Its commercials play like the height of high fashion. 

The success of this approach has enabled Target to grow into an iconic brand existing on a plane that Wal-Mart, Sears, and many other retailers now residing within the discounter’s graveyard, just can’t touch.

What is unquestionably one of the more buttoned-down, home grown corporate cultures, nonetheless drinks from the firehose of a decentralized, chaotic marketplace via a system known as Creative Cabinets, an ad hoc assemblage of third parties from all ages, disciplines, demographics and geographies that help the company discern what products from what manufacturers targeting what consumer needs should find their way onto Target shelves. 

A perfect snapshot of the marriage between chaos and order at work is the fact that while the Creative Cabinets definitely shape product decisions, they have no real authority and individual members never meet as a group, perpetually working independently from one another.

As Michael Francis, Target’s marketing head puts it, “There's no power in bringing them together as a body.  The power is in their working independently. We're the cross-pollinator. We're the integrator."

To be clear, EXECUTING on such a strategy is really hard.  Remember Gap?  Once, a mid-market ubiquitous, well-liked brand, first they misread the fashion market one too many seasons and then they spread themselves too thin.  Now, no one talks about Gap anymore. 

Similarly, the Starbucks freight train that introduced us to $4.00 coffee, baristas and seemingly cannibalistic concentrations of Starbucks locations in every locale has lost its mojo.

Such is is the challenge for Target to maintain its brand and market status over the long haul.  In a world where Wal-Mart is about doing one thing and doing it exceedingly well -- compete on price -- Target, to be successful, not only has to be price competitive, but is dependent on innovation, design and quality as well.

Therein lies the paradox.  To be a creative type and everything that that implies or to be a control and execution freak.  The answer is an unqualified YES for Target’s CEO, Robert Ulrich, who has been with the company for 23 years.

“We micromanage and we think and sweat about every little aspect of the guest experience...we take the time to communicate to our broad organization what they do, why they're doing it, how it fits the whole,” he says. 

Hard to argue with that logic.

Related link:

1. The Marriage from Hell (Great CondeNast Portfolio article on Kmart Sears Merger)