It Takes a Village to Raise a Factory
Lessons Learned in International Sourcing
Haunted by the ghosts of retailers past
Why the market won’t care about mobile payments until Apple does it
I promise this is not just my “sour grapes” in reaction to not making it to South By Southwest this year. Ok maybe a little bit.
Listening to the PR engines wind up and prepare for takeoff as the annual South by Southwest festival gets underway, I started thinking about some of new applications that I have seen launch at the conference and have a fantastic first showing only to peter out in the weeks and years after the festival. A recent question and subsequent post by my good friend Mitch Wagner got me thinking about mobile payments and where we are going to see the tipping from small trials (like this one being planned for, where else, Austin) to full adoption by the general public.
Next year we will probably see a google wallet or some other payment solutions at SXSW, and that’s great. But what is it going to take for mobile payments to gain critical mass? I don’t think it is merely that having mature technology is enough; the reality is that technology has been mature enough to support mobile payments for some time.
I am going to be honest, I was not a believer in mobile payments. Lots of people pitched it to me, all the way back to the mastercard “tap and pay” scheme from a few years ago, and my opinion was always that it seemed to gimmicky, that really the level of effort involved in tapping my mastercard on a payment device seems only marginally less effort than swiping the card, or handing it to a cashier and letting them deal with it.
That was until I got my first Octopus card here in Hong Kong. 
A few years ago my job transferred me overseas, and I got my first taste of the Octopus Card when figuring out the Hong Kong transit system. But soon after I started seeing the Octopus logo everywhere. In the grocery store. In Starbucks. Everywhere. Even some of the Taxis are starting to take it. The first time I used it to pay for something non-transit related was when I ducked into a Mannings one morning looking for some allergy pills. As I was waiting in a very long line, a cashier from the express lane, with no line, waved me over. ”is that all you are buying?” she asked. ”yep” I said. ”Well, I can ring you up right here”. So she scanned my item and as I pulled out my wallet to pay for it, she blurted out “oh, sorry, Octopus only”. So out came the Octopus Card and BAM, payment accepted and I was on my way.
It was like a drug, it was so easy. No wallet, no receipt, no need to sign a piece of paper before I was ready to walk out of the store. (for those unfamiliar, you can register the Octopus card online for auto-refill and to review transactions) One hit and I was hooked. It was the first time that I realized that mobile payments, if done correctly, were the future of commerce for most of the transactions that we as consumers make on a daily basis. There are those of you out there reading this and saying, but yes, the largest transaction amount you could spend on an Octopus is around seventy five US Dollars. That is true. But I have to ask, how many times are you in a rushed situation where you need to spend more than that? I think we need to look at credit transactions and divide them up into large and small purchases. For large purchases, that is, more than one hundred US dollars, I could care less that I have to pull out my wallet. But for a coffee on the way to work, or a vending machine, or a parking garage, or countless other small transactions that would otherwise be paid for in cash, that friends, is where I think mobile payment is going to shine.
So what was it that made Octopus succeed where so many others have failed. I think it’s the ubiquity of the card itself. Try to find a Hong Kong resident that does not possess an Octopus card. With that kind of market penetration all a store needs is a reader and they are ready to take money from just about every person in town.
But that’s enough of my swooning over the Octopus. The point I was making was that success in contactless payment is going to come down to an easy to use system that everyone already has. Which is why I would be willing to bet that Apple is working on their own mobile payment system in the background to be built into the next (or maybe existing) iPhones. There are thirty million people in the USA with iPhones. That means that nearly ten percent of the population of America owns an iPhone. That’s a great market to tap for a payment solution.
There are no doubt going to be people that read this and tell me that I am crazy for making such a prediction. That Android or HTC or some other brand has some technology that will run circles around the iPhone. What I say in response it, it is not about the technology. It is about making an easy to use solution and getting that into the hands of as many people as possible as fast as possible. Apple has, just in the USA, thirty million potential iPayments customers. That’s huge.
Scotch on the rocks: The importance of context in outsourced manufacturing
In the movie Who Framed Roger Rabbit, we witness our protagonist, Eddie Valiant, order a “scotch on the rocks” from a cartoon waiter and we laugh when the waiter returns with a glass that contains scotch and, literally, rocks.
This humorous aside illustrates a very important lesson about conducting business in foreign lands: The context of the
conversation matters just as much as, if not more than, the subject matter. When making the move to outsourced manufacturing, context is easy to take for granted.
When placing an order with a supplier accustomed to doing business with US customers, there are countless contextual items that I know they understand without a long explanation being necessary. These contextual items range from the complex, for example, understanding how to package our order into logical kits for multi-store rollouts, to more obscure, as in stipulating finishes that are LEED compliant, to simple things, like ensuring that all of our electronics and digital signage components have the requisite regulatory approvals.
The combination of our knowing what we need to deliver to our customer and my suppliers knowledge of all of the right questions to ask combine to provide a system of checks and balances that is often absent in supplier-client relationships that cross international boundaries.
In outsourcing some or all of our manufacturing activities, we must be cognizant of the need to provide context around what it is that we are designing and building, because more often than not, our manufacturing partners overseas lack the contextual understanding necessary to understand not just the parts that they are building, but how those parts fit into a larger ecosystem.
I’ve set out to create teachable context with our suppliers many times, and I’ve found that often it is the simplest lessons that have the most impact.
Keep it visual:
Whether you’re up against a language barrier, a culture barrier, or simply find some concepts difficult to articulate, using photos and videos is one of best ways to share your teachable point of view. I’ve often found that what would take me hours to express in words can be understood quickly with just a few photos or a quick video store tour.
Keep it simple:
I find that the more technical the details are, the less I need to talk about it. I rarely discuss critical dimensions in an initial presentation, because the drawings and solid models express that to a precise level. What I have found much more valuable are simple overviews. An explanation of how a particular store is laid out, an overview of the products we are displaying, even a brief description of the types of shoppers that we are targeting all come together to instill in our partners the context around what is it that we want to build. Picture yourself as a tourguide moving through the experience of a store, a display, a product; leave out the technical details and focus on the highlights.
Focus on what, not how:
One of most important skills to hone when outsourcing is to detach yourself from your roots as a manufacturer, and reframe your projects in terms what you want to do, not how you want to do it. Our instincts often tell us that the way to remove risk is to specify every part of our project with as much detail as possible, yet this is often counter productive. By demanding an exact bill of materials and assembly methodology, we tie the hands of our partners, whereas they might be able to make the same product that we want better or at least, more efficiently. Furthermore, by demanding a supplier use an unfamiliar process, we increase the likelihood of errors, adding needless rework costs to our bottom line.
Imparting a sense of context in your suppliers empowers them to create the experience that you want using methods with which they are familiar. The small time investment that you make at the start of your project will pay countless dividends in current and future projects.
The world was not built for expats
That’s usually the first piece of advice that I give to would-be expatriates, and it is one that I, throughout my career, continue to keep in the forefront of my mind. I’ve become good at reciting PO box addresses as if they were my home address, at answering calls from my bank at 1AM because I’m unable to explain that yes I still have my same california number but it’s a skype number and I’m on the other side of the world, and at saying good morning to colleagues on a conference call when for you it’s late a night. Through it all, expats will find themselves bowing to the immovable force of a world built to think and act locally, despite the catchy slogans on posters at our corporate headquarters.
On becoming a manager
I’ve found that there is a clear distinction between the mindset of a manager and the mindset of another group that, for lack of a better term, I call the “doers”. The difference in mindset is most apparent when things go wrong. On the one hand, you have the doers. When problems arise, this group is the first to grab their laptops, soldering irons, and toolboxes, and jump right in to sort out the issues. The managers, on the other hand, must take a different approach. Read more 
What a difference a year makes
The theme for this year at south by southwest conference is “What a difference a year makes”. I found this to be true in my own experience of the conference, and many of my fellow attendees made similar comments about the evolution of the conference in general. As in my past year of attendance, my head is full of inspired writing that I am busily getting down onto paper. So, consider this the first in a series of posts. Read more
Stay Inspired
It’s now officially less than a month until South By Southwest and in honor of the conference I wanted to share a little snippet that up until very recently was included in my speech this year. I had to cut it out, so I’d like to share it with you here. This was especially aimed at those of you that may be attending the conference for the first time, and formed the intro to my presentation. Keep in mind this was a “first draft” and still a bit rough around the edges.
<Snip>
You know, On the first day of my first year attending South By Southwest, I had the good fortune to go out to lunch with some of the awesome folks from Brazen Careerist. During lunch, over a few pints of Guinness a very wise woman in that group (I’m looking at you, Sydney) gave us first timers some great advice. Specifically she told us about how it would feel to leave south by southwest and go back to the <airquotes> real world </airquotes>. As she described the depression that we feel during the re-entry process, My first thought was, “so, about how many of those Guinness’s have you had so far?”. but a few weeks later I knew exactly what she meant.
And so my advice to you is this:
Stay. Inspired.
You have to work at it, inspiration doesn’t always come easy out there in the real world.
It’s easy to be inspired here. South By Southwest is inspiring wholly because of all of the amazing, Read more
The Power of Different
I am a technologist by training, having studied computer science at the University of Delaware in undergrad, and by design I am naturally drawn to technology of all denominations. It should come as no surprise that some of my favorite leisure
time reading materials are technology oriented.
Yet some of my best inspiration has come from outside of the technology sphere, from immersing myself in stimuli that are outside of those things that I would normally be drawn to, and this is a theme reinforced by several of the mentors in my life. Time and again I find that solving complex problems requires experience that is more broad than it is deep, and I thankful that the past few years have helped me broaden my knowledge far outside of my previous education and career experience. Read more
Retail Design, New York City Tourism, and New Beginnings
My wife and I just returned from a trip to New York to visit with my family, and while there we managed to spend one of our days in New York City, where I grew up.
(my family just recently realized that I have nearly reached the point where I have not lived in New York for as long as I lived in New York, and they took this opportunity to remind me of this newly discovered fact several times. Thanks mom!)
We had a chance to have dinner with some friends, who asked my wife what quintessential “New York Things” had I taken her to see. She quickly responded by recounting our first trip to New York, which we spent riding the subway and visiting every Best Buy in Manhattan, along with a few other smaller retailers. In hindsight, probably not the best first impression that I could have provided, however, it serves as a great metaphor for the motivations that drive me as a retail design thinker. I am passionate about what I do. A little too much at times.
I started my career in manufacturing, designing and building merchandising solutions, Read more
Thunderbird
Thunderbird has been on my mind a lot lately, mostly because I have just taken a new position as my first expatriate assignment, and I continue to run into Thunderbirds overseas at a rate that is pretty amazing.
I started to write a post about my upcoming move to China (coming soon), but I soon realized I needed to give some background first, specifically how I got where I am right now.
I’m a technologist by training, and along the way I had picked up enough business knowledge to advance reasonably far through my career. A great deal of this knowledge was picked up from my mentors, members of my “personal board of directors” and my good friend, Google. As I became less of a hands-on technical staff member and more of a manager, I felt increasing pressure to defend my decisions with sound managerial decision making. Read more
South By Southwest 2011 – Time to Vote
It’s that time again: Time to vote for the panels that will be featured at South By Southwest 2011. 
This year, I have proposed a panel covering the topic of enterprise collaboration tools. A complex topic, to be sure, but the focus of my panel discussion will center on the types of tools that can be deployed in the enterprise today, and in the course of our one hour panel, I will make the case that the best choice for enterprise collaboration tools is often the simplest.
