The one and only Hodad’s hamburger.

Living in Asia and spending most of my time on the mainland of China leaves me missing so many of things that we take for granted in other areas of the world.  Western food is, of course, one of those things that is just hard to find outside of large cities.  A few weeks ago, I found myself criss-crossing Shanghai with several colleagues, looking for a sample of a hard to find electronic component.  After a few fruitless hours of searching the various markets, I suggested to everyone that we take a break for lunch;  this request for a lunch break happened to occur while in close proximity to one of the better hamburger spots in Shanghai, Kabb Grill. (It’s no Hodad’s Hamburger, our favorite from back home in San Diego, but hey you take what you can get around here!)

Over a few cold beers our frustrations started to melt away, and we started chatting about other various topics.  Finally, one of the engineers spoke up and said “You know what we need? a radio repair shop.  Transistor radios always have these types of components in them”  A moment later I asked “couldn’t we just buy some cheap radios and get the parts from there?” A stunned silence fell over all of as we realized that we had solved the issue that had been dogging us all day long.

We might have figured it out eventually, but it was pausing for a few minutes, and occupying our brains with other thoughts that brought the solution bubbling to the top. It was a good lesson.  It is easy, especially when you are far from home, in a strange place, at a supplier, with a time crunch weighing on you heavily, that you can get overwhelmed with, well, everything.  I have been trying recently to consciously stop myself, and take a step back from the situation, and it is in these moments, these times when I walk away from the group and put on my headphones for five minutes or occupy my mind with writing a random blog post, that a solution suddenly becomes apparent.

Sometimes when you’re struggling with a problem that seems insurmountable, it might be time to take a break, take a walk, play a game, have a beer, or if you’re so lucky, go have a hamburger.

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.

At this very moment I am in a hotel in Bangkok, which is seemingly the only place in town where one can escape the barrage of stakeholders extolling the advantages of opening a factory in Thailand. Their reasoning is not unfounded, and it does not take much looking around to see the fertile ground where upon the next global manufacturing powerhouse may arise.

I have been thinking quite a bit lately as to what that magic set of ingredients might be. Where is the interesection of favorable trade rules, tax incentives, labor costs, and infrastructure, and how might a country create the ideal environment in which manufacturing might thrive?

Regular readers of my column know that I run a factory in China, and as an American citizen who has chosen to build a business overseas, I have had no shortage of opinions thrust upon me at countless cocktail parties. What I have spent a long time explaining is the reasons that we are here, for they are never as simple or clear cut as popular rhetoric or sound bites may lead you to believe.

We are not in China because of the low cost, and in fact, having set up and run a company here for the past few years, I can say unoquivicably that the cost advantage that we once enjoyed is fast vanishing. There are cheaper countries in which one can set up shop, and even now local factory owners are beginning to entertain the option of opening new facilities in other, lower cost locations.

The reason we are here is because this location is extremely well equipped to support manufacturing. China has become a center of excellence for many products, from simple items like stamped steel to high tech items like the iPhone that I am using to write this article.

In my business, retail fixtures, we build products from wood, metal, and plastic, and often integrate electronics like lighting or speakers and video screens.

In retail, as with many other industries, speed to market can make or break a company. Although we have a talented team of in house designers, we rely on our vendors to give us design feedback and help us sourcing the correct components. It is the proximity of these vendors and suppliers that make China the most valuable location for so many manufacturers today, ourselves included.

For all of the high tech collaboration and networking technology that we can deploy today, design and manufacturing is still a very hands-on business. Regardless of how perfect we can make a 3d computer model, once we make a prototype there are always changes that need to be made. Showing a prototype sheet metal shelf to one of my suppliers inevitably leads to a conversation about what I wanted to accomplish, and usually several new suggestions from that supplier about how we might bring that vision to life. The same process repeats itself for our plastics suppliers and electronics vendors. The proximity of so many qualified sub contractors, and their willingness to change their output to match our needs is what a true manufacturing advantage is made of.

And so it seems that the way to enrich the soil to drive manufacturing growth is to ensure the growth of all of the ancillary and supporting factors needed. A factory cannot survive as an island unto itself, it truely takes a village to support it’s growth.

Nokia recently aquiesed to this reality as their worsening financials forced them to close their factory in Romania. As Nokia put it in the official statement, the drive to gain efficiency has forced Nokia to “Focus its feature phone manufacturing on those locations with optimal proximity to suppliers and key markets…. Nokia’s high-volume Asian factories provide greater scale and proximity benefits.”

I am reluctant to blame their current economic situation for these cuts, as it simply is the most sensible thing to do. The invisible hand of the markets pushes us to produce our goods for the lowest cost possible at a given quality level; only by moving our manufacturing operations to areas that have a robust support network can we be assured of maximizing our efficiency.

You don’t have to be Nokia to realize the benefit of a robust network of suppliers in close proximity to your factory, and in fact, it is the smal to medium size manufacturers that stand to gain the most from these regional business relationships. I make lots of parts from injection moulded plastic, however I can not afford to purchase and run a complete moulding line.  Having a supplier nearby gives me the advantage of their scale at a price that allows me to be competitive.

It is not all doom and gloom however, but rather a new set of considerations that we must take into account. I have met some great manufacturers in the USA that ensured their survival by simply bringing more competencies in house. If your metal vendor closes up shop, perhaps the best option is to bring metalwork into your own factory.

Regardless of what it is that you make, understanding not just your role, but rather the entire ecosystem is necessary to ensure that you make the right decisions, whether it is a decision to relocate existing factories across the ocean or to add more competencies by expanding those facilities.

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.

Act fast 

I’ve had several assignments that involved a relocation, and each time I’ve found that the key to success has been to act fast.  All of the things in your life have a certain momentum, and you have to lay the groundwork early to ensure that things don’t fall apart during the transition period.  It is amazing how fast bills and other milestones pile up when you’re off in a new location trying to scout out an apartment and turn on utilities in a foreign language. So my advice is, as soon as you can, rent a new place, get a PO box, sign up for a skype number, and settle in for a bit of a bumpy ride.

Take a hard look at all of the actions that you take on a monthly basis related to your current living situation. Bills. Phone calls.  Parent teacher meetings.  Little league coaching commitments. Book club. That gym membership you’ve been meaning to use. Whatever it is, it’s time to start setting up the systems to offload the responsibility for some or all of these tasks to other people or to technology.  Regardless of HOW you address each of these items, it is crucial to address them as early as possible.  Time, as it always does, will get away from you.

Bills

This is easily the most critical item, and possibly the most complex, save for those of you that are trying to line up a high quality english language immersion elementary school for your kids in the backwoods of Asia.  Most of your creditors today have no doubt been encouraging you to “go paperless”, and now is the best time to take them up on the offer. Start by listing all of the people to whom you pay money on a regular basis and perform a triage;  those that are not needed, cancel now (this is the best part, by the way), for all of the others, start by enquiring about paperless billing.  Autopay is even better, because you will almost certainly have other things on your mind.  For those creditors and customers that are stuck in the stone age, you’ll have to provide them with a new address for bills and payments.

I feel like I have relocated some many times that I almost have it down to a routine.  During my first international relocation I found a snag, however.  While before I had typically gone to my new city and set up a PO box at the nearest Mail Boxes Etc (Now the UPS store, albeit with the same basic features), relocating internationally meant that I had to find another place to send my mail.  What I found was a service that catered to the perpetually mobile, a PO box that would (under the supervision of bonded security guards, no joke!) open our mail, scan it, and email me a scan of the envelope and the contents. I found this service through a website advertising services for RV-ers, and regardless of intended audience, I’ll bet that there are more than a few expats that need such a service.  Another great place to look is in companies that provide services to military personnel and their families.

Power of Attorney

Before I embarked on my first overseas assignment, I sought the advice of my father, an attorney, on what legal items I needed to have in place before I left the country for a long period of time.  He suggested, above all else, that my wife and I should to appoint a power of attorney to help us should we ever need to sign any documents for banks or other legal contracts.

As is typical in father-son relationships, I didn’t listen.  I mean, what are the chances, right?

Of course, less than 6 months into our time overseas, up crops some legal documents that my wife and I need to sign and notarize.  What would have been an innocuous action on US soil turned into quite an ordeal in our small town life overseas. After traveling to (and barely missing our appointment at) the US embassy, we forked over one hundred dollars for the consulate to notarize our forms, and another seventy dollars to FedEx these forms back to the USA.  Nearly two hundred dollars spent to sign two pieces of paper, all because I couldn’t be bothered to fill out my power of attorney forms.  As they say on the internet, learn from my failure

Excess Stuff

My wife and I moved in together after separately owning two 3-bedroom/2-bath homes.  Luckily we had a garage to hold all of the overlapping things that we brought together into our newly formed joint household.  It wasn’t until a few years later, on the eve of our first “family relocation” that we dealt with the cornucopia of excess that had been camping out in our little used spaces. It is only when faced with the prospect of having to put most of our things in storage that we considered whether we really needed four vacuums or seven televisions.

In the same vien, I am also a huge proponent of file digitization. Some time ago, I had the good fortune of working closely with the people at Fujitsu, who introduced me to their Scansnap scanners.  I don’t hesitate in telling you that these devices changed my life, and I would be lying if I said that I didn’t have their newest model in my laptop bag right now. Whereas we once had a large filing cabinet full of paper (not to mention piles on our desks), the scanner enabled us to digitize and catalog every document that we needed, and many that we didn’t need.  I can think of more than a few occasions where having a digital copy of an obscure receipt or loan document saved me from hours of needless tribulation.  For those of you with neither the time nor inclination do scan it all yourself, there are several services on the market that will happily take boxes of your files and trade you pdf files in return.

The little things

After six years working at Circuit City, I went to work for one of our vendors, a small one, based in New Zealand. My boss there was a great guy who had recently immigrated to New Zealand from Germany.  Early on in my time there, he said something to me that has stuck with me for the rest of my career.  He remarked, casually, that there is a huge difference between having a holiday abroad and working abroad. Throughout my career, this is a theme that has been reinforced time and again in my own experience.

It’s often the little things that you miss the most.  Life has a rhythm over time, and when we disturb that rhythm, our minds strive to get it back in line.  On holidays it’s fun, because you know that the period of discomfort is temporal, that it will be over soon and you’ll be able to go to Target to get your Bisquick and fairly traded coffee and chai tea concentrate (these are some of the things we buy, your mileage may vary). When you’re on holiday, you can laugh at the scorpion appetizer and spicy boiled frog soup, without thinking about whether tomorrow’s dishes will be more western.

I remember a particularly funny moment at the local gym when I was sitting down with one of the trainers and she asked me if I liked hamburgers. I jumped up in my seat and said “Wow, I sure do! Do you know any place around here to get a hamburger?” I was hoping upon hope that I had missed some secret small town hamburger joint, and she was about to clue me in.  ”No, I was just using that as an example to talk about nutrition, let’s talk about diet…..” well, anyway, I don’t remember the rest of the conversation because all I could think about were my shattered dreams of having a hamburger in some random small town overseas.

The expats that I have met that are successful over the long term have struck a balance between immersion in the local culture and holding on to the people back home through social media, email, streaming audio video, and other communication tools.  Me? Still not quite there.  But I’m working on it.

As someone who is a technologist by way of undergraduate education, and a manager by way of experience and graduate studies, this is a battle that I fight, internally, on a daily basis.  I have always been a doer, always the first one to get on a plane and sort

Late night, on the phone with the lead engineer, soldering it all together in time for a presentation to the customer in the morning

out whatever issue had cropped up at the moment. Transitioning to a managerial role means going against behavior that, for the first half of my career, had been instinctual.

During a job interview or yearly review, you may be asked to discuss your weaknesses (or shall we say, “opportunities for growth and improvement”).  This one is mine.  Almost daily, I fight the urge to fix the issues as they occur. When a problem arises, I almost instinctively want to rush to the site of whatever it is that has gone wrong, and give that one situation my singular focus.

The issue is that, by giving one problem my sole focus, all of the other decisions and course corrections that I need to make throughout the day fall to the side. By ignoring the forest and focusing on one tree, I will have probably created more issues than I will have solved.  You don’t have to be a mathematician to understand that working in this way is simply not sustainable.

Transitioning into management is akin to becoming an orchestral conductor.  You need to have a great ear, to keep your finger on the pulse of the operation.  You must be able to correct the course quickly, and at all times know where it is that you are going before you get there. As a manager, your employees are not served by you taking on their responsibilities any more than an orchestra is served by the conductor picking up a instrument and playing along.

Count to ten

We’ve probably all heard the old adage, that when you’re overwhelmed, you should stop and “count to ten” before you act.  I use this same technique at work.  Nobody would be served were I to simply dash out of the room to chase every issue that arose.  And so, in making decisions in a managerial capacity, I find that taking the time to consciously stop, take stock, and (mentally) count to ten helps to put everything in perspective.

The right man for the right job

There is an old story about Henry Ford. Legend has it that, while being grilled by reporters about his automotive industry credentials, he offered to answer any of their questions.  The first, a question about engineering: when queried, he did not answer, but offered up his lead engineer to answer the question.  This continued, with questions answered not by Henry himself, but by the person most qualified to answer on behalf of the company.

As a manager, I do my best to adopt a similar mindset.  As in my previous point, above, I constantly do battle with the desire to simply get things done on my own.  Yet, I am most certainly not the best man for the job.  Throughout my career, I have sought to surround myself with people more skilled than I am.  When I was younger, this manifested itself in my desire to have mentors in every phase of my career.  Later, I sought out these same types of qualities in those people that have come to work for me.  Whether the student or the teacher, I never want to be the smartest person in the room, just the best manager.

One last thing

That is not to say that as a manager you cannot dash from the room to deal with emergencies, and in fact many times you will have to do so. In the world of manufacturing, things can and will go wrong, and knowing when a situation has reached the tipping point is just as important as being able to hold back and send someone else in your stead.

On the ground with Best Buy China

China was where I wanted to be. Being a technologist by training, I had always had in my mind that an MBA was going to become more and more necessary to fill in the gaps in my business knowledge.  After a few years of China experience, I knew that I needed to go back to school and focus on International business.

In late 2007 and early 2008, I started exploring my options for International Business programs, and time and again, a school right in my own backyard kept rising to the top of the list.  I had been relocated to Scottsdale for work, so it took only a few minutes to head over to Thunderbird for an information session one night after work.

I remember listening to several Alumni tell stories just like mine, feeling all at once like a fish out of water and knowing that they were in a place where they belonged.

And so, after much deliberation, I took a two year break from work to attend Thunderbird School of Global Management.

Recently, I have joined the team of Lynx Innovation as the General Manager of our soon-to-be-opened design and manufacturing center in China.  Over the past five months, I’ve traveled to China countless times, and the feeling that I have while there could not be more different.  Although I am far from knowing everything about any foreign culture, I understand the differences in communication, in cultural understanding, and in communicating across not just language but cultural barriers as well.  I even found myself discussing the nuances of communications across these cultures to some of my colleagues.  Quite a difference from how I felt during my first few trips.

I was reminded of this change by a recent article posted on bNet about this very topic, where they quote Thunderbird and the lessons in communication taught there.  I can say without a doubt that I am better for having learned these lessons and you would all be well advised to read this article.

In addition, I have a few teachable points of view to share with my fellow fixture manufacturing professionals:

Learn a little language: You would be amazed at how much traction you will get in even just trying to speak the language of those with whom you are doing business.  Especially in a “High-Context” culture where actions quite literally speak louder than words, this can really help to open the doors of communication with your hosts.  There are countless ways to learn a language, my personal favorites being Byki and Pimsleur.  Try an iPhone based system to give you something to do on your long transpacific or transatlantic flights.

Understand the culture: As with language, a little effort goes a very, very long way.  There are many tools available online and at your local library (or university library);  Cultural Navigator and CultureGPS are two great tools, CultureGPS even has an iPhone app that you can use to quickly look up cultural information.

Reach out to Colleagues: you’re probably not the first person to embark on this particular sourcing adventure, so reach out to those that may have done it before.  LinkedIn groups are a great resource, as is the ARE website.  You may even find someone on the ground that can help you out, as I have done on a few occasions.

Eliminate pre-conceived notions: When all of the information that we have about a foreign culture comes from news outlets or other media, we end up with a skewed view of reality.  Almost everyone asks me what it is like to work in China, and I always start with, “It’s probably not at all like what you think it is”. One of my colleagues summed it up well, that the answer to the question “How long is a piece of string” inevitably is answered only through our cultural outlook, not some absolute truth.  Overseas you will find this applicable to countless situations, that our individual cultural viewpoints may give two people a completely different answer to the same, seemingly obvious question.

And lastly, beware the China hand: This was a piece of advice given to me by one of my professors during my Thunderbird studies in Beijing, and it’s one that I have found to be particularly valuable.  I’ve been to China more times than I can count, and yet I know that in terms of culture and understanding, I’ve barely scratched the surface.  My value comes in knowing enough to know that I don’t always have the answer, but that I can ask the right questions.  The China hand is that person who has been to China twice and is now a self-declared expert on China business.  Be aware of anyone that can give you an immediate, absolute answer to any question that comes up in international business dealings.  As with all situations in business, if it feels wrong, it probably is.  Don’t be afraid to ask questions, dig deeper, understand the situation fully before you accept the answer.

Original published to The Association For Retail Environments

Personal

If last year was the year that revolutionized my thinking and my world outlook, this year was the year that refined it.  At south by southwest 2010, I was arrived in Austin Texas feeling lost.  I had recently graduated with my MBA in International Business, and for the previous two years I had been working at an interactive agency serving the SMB enterprise market.  It was time for a change, I just didn’t know what that change was.  Yet.

I went to all of the panels, I stayed out late, I met as many people as I could, because I was searching for the opening words of the next chapter of my career.  I met some of the most amazing people, and got to attend an amazingly diverse group of presentations.  I can honestly say I never wanted it to end.

More surprising was the amount of people that reached out to me after the conference to tell me what an impact that had on their own experience at South by Southwest.  At first I was confused, I hadn’t been a presenter, how did I have an impact?  So I asked them what it was that I had said that had inspired them. People were able to relate back to me something that I spoke about when I met them in the hallway or out at a bar.  It was an amazing experience to suddenly feel like I had an impact on something outside of my usual sphere of influence.   I wanted more of that feeling.

I decided that instead of looking at what I wanted to do right now, I would be better to look at where I wanted to be in a few years.  I knew I wanted to go back into retail design and shopper marketing, I wanted to leverage my new international business degree, and I needed to start speaking at conferences, like, for example, South by Southwest.

The Proposal

Leading up to South by Southwest in 2010, I made a few proposals to speak, but never having been to the conference, I had a hard time building a proposal that resonated with an unfamiliar audience.  Hugh Forrest, the founder of South By Southwest did like one of my proposals, and gave me a great review and some great feedback, but in the end my panel did not get picked.  In hindsight, I’m really glad it didn’t.

The following year, determined to present, I worked with several South by Southwest Alumni to build a compelling proposal.  Within a few weeks of the speaking proposal voting opening, I received a message from David Scott, an author that was hosting a session on social business.  He had seen my proposal, and wanted to know if I wanted to speak, solo, in one of the time slots.

I practiced my speech for hours at a time, editing, reading it out loud, and editing some more.  I was nervous, and could not wait until my time slot was up.

For those of you that have not made a speech at a conference, there is a lot of prep that goes into keeping things moving smoothly.  Hours before I was due on stage, I checked into the green room.  I got assigned a handler, had some food, drinks, even a back massage.  I sat down at my table, pulled out my computer, and continued reviewing my speech and PowerPoint slides.  It just so happened that the person sitting next to me was a famous author, and before I can say anything to him, he comments, “That’s a good idea, I wish I had some printed note cards, I get so nervous before I go on stage” and all I could think was, ok, if this person gets nervous before getting on stage, then it’s ok that I’m nervous.  Normal even.  The green room fellowship calmed me down.

The rest of it is a bit of a blur, before I knew what was happening, I was standing up on stage, in front of a big crowd, giving the speech that I had given hundreds of times before, at least, hundreds of times before while I was alone in my apartment.

All in all, it was an amazing experience, and true to the advice of “never let them see you sweat”, I kept my nerves hidden well; even friends that knew I had some jitters commented that they never would have guessed I was anything but confident and engaging.

I’m glad that I presented on Sunday, so that I could have 2 days of panels and presentations afterwards where I could focus on enjoying the mental stimulation without worrying about my impending presentation.

I’d like to do it again.  Will I submit a proposal for next year? Probably

For those of you interested, I posted a video of one of my rehearsals below.

In the light of Best Buy’s recent decision to pull out of China and Turkey, one is led to conclude that there is still a lot of opportunity for the retailers of today to learn from the lessons of the past. It is doubly frustrating when you believe, as I do, that the very behaviors that led to the success of Best Buy in the United States would have been helpful to duplicate in their entry to china.

The wall of history features prominently in the main foyer of the Best Buy corporate campus in Richfield Minnesota. Walking it’s length you can read about the history of the company that was once called “Sound of Music”, and of particular note is an event that happened on June 14th 1981. On that date, a tornado ripped through their Roseville store location, damaging and destroying a significant amount of inventory. In the days following the storm, the team at Sound of Music set about liquidating this inventory in preparation of rebuilding the store, through a tent sale format that claimed all sales would be “best buys”. Response to the “best buy” sale was fantastic and within 2 years of the tornado, the first Best Buy branded store was open for business in a new superstore, deep discount format.  In product development circles we call this pivoting, changing direction in response to customer demands. Quite by accident, a regional hi-fi shop in Minneapolis had discovered the pent up demand for the superstore format that had been brewing in the American consumer.

When I look at Best Buy’s decision to refocus their international aspirations, I believe that they failed to capitalize on an opportunity to find their unique differentiation in the Chinese market, and have repeated mistakes of retailers before them.

I remember being on site at Best Buy Shanghai during the grand opening. The Shanghai Best Buy was nothing short of spectacular. From its prominent location on the Shanghai skyway to the immensity of it’s interior (4 floors), it was, all in all, fairly awe inspiring. Once we got past the immensity, the second thing that struck my colleagues and I was how “American” it felt. From the store fixtures to the floor finishes to the signage and employee uniforms, you would swear that they had simply packed a standard Best Buy into a few shipping containers and reassembled it in China. I still remember how all of the HDTV content in the video department was playing their standard American content.  It was absolutely surreal.  What was also striking was how different it felt from all of the other major retailers in China. Most other electronics chains, like Suning and Gome, as well as the electronics departments of general merchandise retailers like Metro and RT-Mart, all offer a similar shopping experience.

Best Buy argued, indeed correctly, that they offered a differentiated shopping experience in the otherwise homogenous selection of electronics retail outlets.

The problem is, it is not whether you are differentiated, what matters is whether you are advantageously differentiated within the market.

Best Buy succeeded in the United States market because it turned out that most consumers viewed buying electronics as only marginally less frustrating than purchasing an automobile.  Best Buy’s superstore format made it easy, stress free, and mostly self-service.  By addressing the needs of the market, they quickly rose to the number one spot.

When entering new markets, it is dangerous to assume that the market demand of your current customers exists in your foreign customers, and in fact it is far better to take the opposite approach, and take your time to perform market research due diligence.  Wal-Mart learned a similar lesson during their entry into the German market, where their Americanized stores failed to capture the hearts of the German consumer, and led them to pull out just a few years later.  Learning from the strategic mis-steps that prevented their entry into the German market, Wal-Mart has done quite a good job making their Chinese stores feel much more localized.  I can’t say that they offer an advantageously differentiated experience compared to similar retail outlets, however given their plans for growth in the market, things seem to be going well.

As Andreas Knorr and Andreas Arndt remarked in their study of Wal-Mart’s retreat from the German market:

“Wal-Mart’s attempt to apply the company’s proven US success formula in an unmodified manner to the German market turned out to be nothing short of a fiasco.”

In a post-withdrawl interview with Wal-Mart German Division CEO David Wild, he remarked,

“If you want to be successful in a foreign market, you have to know what your customers want. That’s the most important lesson…..It does no good to force a business model onto another country’s market just because it works well somewhere else.”

As more and more retailers begin eying up an entry into Chinese, and other global markets, they would be well advised to study those that have come before them.  Learn your history, for failure to do so can cost you dearly.

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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, inspiring people that attend every year.  Once you leave, it’s easy to get bogged down in the demands of your job, your classes, your wife, kids…all of the above.  But if you persevere, if you work hard to stay inspired, you can do anything.  If you take only one thing away from this conference, take with you the inspiration that you feel here, that knowledge deep down inside that together we can do anything.  Don’t lose that.

Stay. inspired.

Great things happen when we give our ideas an environment in which to flourish.  Over the past few years, lots of firms have released new products in a category they are calling “Innovation Management”;  and what they are creating is simply a virtualization of what we have right here, South By Southwest is an environment that fosters the growth of great ideas.

I have had the same job for almost my entire career.  I’m a visual merchandising designer; I design and build retail stores.  Now normally, visual merchandising and store design is not the type of thing that gets my audience to the edges of their seats.  But when I returned from south by south west last year, I found my self searching for inspiration. It was then that I realized that so many of the issues that I had been facing in my workplace were being faced by other people in a diverse array of backgrounds and industries.  The issues that I chose to focus on related to how my co-workers and I are able to collaborate across language, time zone and cultural barriers.

To help me recover from PSXSWDD (Post South By Southwest Depression Disorder), I started writing this presentation in April of last year. I shared it with a few people, and one of them liked it, and before I knew it, here I am speaking to you at South By Southwest.

And so today I would like to talk to you about the trials, tribulations and lessons learned in managing virtual teams in my small yet multinational company…..

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So think of that as a teaser…you get the rest when you attend my session, in the Future 15 section, 11AM on Sunday the 13th of March. (I take the stage at noon). See you there.