Start-Up Nation by Dan Senor and Saul Singer seeks to explain why Israel produces more start-ups and entrepreneurs per capita than other countries. The book tells many interesting stories about the start-up nation that is modern Israel along with technology start-up companies born out of the unique mix of cultural, demographic, military, geographic, and historical factors that shape how Israelis think, innovate, and act. Although the lessons learned may have few direct applications inside of our businesses, the book still gives us much to consider about the world in which we live.

I started reading Start-Up Nation several weeks ago, before Hamas terrorists invaded Israel. As I read the Forward by former prime minister and president Shimon Peres, I was concerned the book would be a “puff piece”, telling the story of Israel in an overly positive manner. I know the issues behind the continuing unrest in the Middle East are far more complex than I can claim to appreciate, but the tone and the claims of the Forward put me on notice that the rest of the book would clearly be told from the Israelis’ perspective.

More than anything, Start-Up Nation has helped me better understand the Israeli experience from the birth of the nation 75 years ago to today. Because the book was written in the language of business, I can more easily understand and appreciate the stories being told. These stories help me understand what I see on the news: the long standing animosity, the geography of the surrounding Israeli enemies, the nature of the Israeli Defense Force (IDF), the close-knit relationships across the country underlying statements that everyone knows someone killed or taken hostage, and the strength of the national identity.

While Start-Up Nation should be most helpful to policy makers who can influence the factors described to increase entrepreneurship and innovation within their communities, others will find the stories interesting and informative, especially in light of continuing conflict in the Middle East.

Read my full review here.

Today we take mobile apps for granted. They are integral to every aspect of our lives. And yet most of us can at least vaguely remember that this wasn’t always the case. In the article linked below I trace the beginning of the mobile app revolution to the early 2000s when a bunch of scrappy startups came together to help businesses start leveraging the power of mobility to improve how their teams worked.

Workers who were constantly moving around but needing to stay connected as a team came to love Nextel’s solution. With a push of a button, they could open a channel to one person or an entire team. The company quickly became the market leader within industries and departments that relied on mobile workers, whether they be blue collar laborers or white collar sales and service reps. Customers’ value of the Nextel service translated into them paying, on average, $69 per month, compared to the industry average of $51. Although it had become a big company, Nextel maintained its scrappy startup culture, constantly challenging the status quo.

Traditional software companies were also working to serve the kinds of mobile workgroups that were buying Nextel push-to-talk phones. What companies wanted, and workers would accept, was a software-based solution that actually ran on the phone they carried with them. But that would require the wireless carriers to make some major investments. Between 1999 and 2002 Nextel and Motorola worked together on four capabilities critical to the establishment of the Mobile Business App category. Those were a true packet data network, a software platform, GPS capabilities, and a business support platform.

I like to describe the value that carriers like Nextel brought to pre-iPhone software developers as being in three buckets: bits, bills, and bags. First, Nextel provided the core data capabilities (bits) including the packet data network, the development platform, and the GPS data. Second, the company provided the business infrastructure (bills) including the “bill on behalf of” capability and frontline customer support. Third, Nextel served as a sales channel for the software companies (bags), both through the download site as well as through the growing Nextel salesforce, many of whom were focused on the specific industry verticals being targeted by the mobile business application developers.

Through the business solutions team, Nextel pulled together a loose coalition of developers to firmly establish the Mobile Business App category. In addition to OpenWave and TeleNav, the team also helped startups focused specifically on business applications including GearWorks, Xora, Digital Cyclone, Trimble, and many more. Nextel became the title sponsor for NASCAR races and would invite car-loving customers to pre-race events where they would hear from a variety of the company’s software partners about how these new applications could dramatically improve the performance of their business.

Read the full article here.

Whatever You Do from Made to Flourish is a thoughtful and thought-inspiring book. Made to Flourish is a ministry focused on helping local churches help their people integrate their faith into their work lives. The book explores how we can pursue integrating our faith into our life through six theological themes: the Bible’s grand narrative, redemption and renewal, personal wholeness, flourishing-minded work, economic wisdom, and the local church. Christians seeking to integrate their faith more holistically into their life will likely find some ideas and concepts here that will help them on that journey. 

Whatever You Do is a theologically-rich book. Three of the six authors are theology professors at major Christian universities. They don’t shy away from digging into theological topics and applying them to the world of work. The book calls us all out, as individual Christians and as local churches, and challenges us to think deeply about how the Bible’s grand story, and God’s call on our lives, translates into our daily work. The book doesn’t try to provide specific answers, but rather helps each of us to think through what we believe and how that should impact the decisions we make every day.

Read the full review here.

One of the highlights early in my career was playing a small role in the creation of the new category of frame relay services. However, if WilTel and its earliest competitor in the category hadn’t made an essential change in their marketing and sales tactics, the category may have never become established.

The article linked below tells the full story, but a few of the key lessons learned include:

1. There’s no such thing as a category of one
2. Early adopters are essential for learning from/adapting and for building credibility
3. Additional entrants, especially if established brands, can accelerate category adoption
4. You aren’t really competing against other category entrants. Focus negative messaging on the status quo.

Click here to read the full story of WilTel’s launch of WilPak, the world’s first frame relay service.

Bottom line, Playing to Win is likely the best book on strategy that I have yet read. It teaches concepts in an easy to understand way, provides frameworks that are easy to use in real world situations, and provides lots of examples to show how the frameworks work in a real company. I strongly recommend Playing to Win to anyone involved in strategy development and strategic decision making.

At the time Playing to Win was published, Roger Martin was Dean of the University of Toronto’s Rotman School of Management and A.G. Lafley was the former Chairman and CEO of Proctor & Gamble. The book’s title stems from the authors’ contention that companies must “play to win” or else they are wasting everyone’s time and investors’ money. Too many companies “play to play” which can appear to work for a time, but in the long run simply destroys value. 

Playing to Win is mostly structured around the Strategy Choice Cascade. Proctor & Gamble examples are used throughout the book to demonstrate how the framework works in real life. The Strategy Choice Cascade is a series of five questions that define a company’s strategy:

• What is our winning aspiration?
• Where will we play?
• How will we win?
• What capabilities must be in place?
• What management systems are required?

Chapters 2 through 6 each deal with one of the questions in the cascade. The chapters often include tutorials in basic concepts of competitive strategy such as market segmentation, customer needs research, generic strategies, differentiation, etc. Each chapter includes detailed step-by-step case studies from P&G, a list of “dos and don’ts”, and often a story from either Martin or Lafley (or both) to share their personal experiences (sometimes painful) that helped them learn the key concepts covered in the chapter. There’s a lot of detail in these chapters beyond what the simple questions in the cascade might imply. Anyone involved in the kinds of hard strategic questions any business (especially a large one) faces will be able to relate to and learn from the many stories told and lessons taught.

Chapter 7 is titled “Think Through Strategy.” At the beginning of the chapter the authors point out that the cascade is helpful, but in the real world leaders will ask: “But how and where do you start? And how do you generate and choose between possibilities at each stage?” They offer another framework as a starting point. The final full chapter in the book introduces yet another framework to help with strategy development. The book closes with a short Conclusion titled “The Endless Pursuit of Winning” which ties the three main frameworks from the book into what the authors call a “playbook” for strategic management in a dynamic competitive world. 

Read my full review here.

In 1985 Roy Wilkens was serving as president of Williams Pipe Line, a division of The Williams Companies in Tulsa, Oklahoma. An electrical engineer by training, Wilkens had risen through the ranks in the energy industry and now was leading one of the country’s largest petroleum products pipelines. Little did he know that he was about to jumpstart an entirely different industry.

From a regulatory perspective, the Department of Justice had just ordered the break-up of AT&T, leading to the emergence of dozens of new long distance competitors. From a technology perspective, fiber optics was emerging as a viable means of transporting telecommunications signals with high reliability and low cost over long distances. Roy and his team recognized the opportunity to build and operate a new kind of pipeline — one carrying bits rather than BTUs.

Many of the new long distance competitors were ambitious entrepreneurs who saw the opportunity to sell long distance voice services to homes and businesses. Each of these startups raised enough capital to buy a long distance telephone switch and then connected that switch to all the Bell operating companies that had been broken out of AT&T. The closer they could connect into the Bell networks to where a call was originating and completing, the lower their cost. The scary situation for these startups was that the only company that could sell them the circuits to make all of those connections was AT&T, the very company they were competing against. 

One of those entrepreneurs was Clark McLeod. He started Teleconnect by taking out a second mortgage on his home and raising money from friends and family. McLeod had been in talks with six other entrepreneurs, each of whom had raised enough funding to build a regional fiber network, but none of whom could afford to build a nationwide network. Although competing with each other for long distance customers, the seven carriers decided to band together to solve the longhaul interconnectivity problem. They formed the National Telecommunications Network (NTN). Rather than build its own fiber network, Teleconnect contracted with Williams to build a “midwest cross” from Minneapolis to Kansas City and Omaha to Chicago and connect it into the NTN network. 

The partnership was a huge success. The companies interconnected their networks and figured out the operational details for provisioning a circuit across multiple networks. NTN’s president, Martin McDermott in Washington made sure everything operated smoothly and directed the lobbying efforts to protect the rights of the emerging competitive communications carrier industry. Each company immediately had the combined reach of its brethren, cutting their costs and improving the quality of their calls. Williams remained a carrier’s-carrier, not competing for retail long distance customers but selling circuits to all the other long distance carriers and some very large business customers. 

Through the combined efforts of all, long distance prices continued to come down and the market grew. Eventually long distance calls became so inexpensive that they were bundled into unlimited cellphone and broadband offers. Without the collaborative efforts of the NTN members, it’s impossible to know what would’ve happened, but if AT&T had successfully crushed the nascent industry it’s likely we would not have seen the innovation and falling prices that we have all enjoyed.

Read the full article here.

There’s No Such Things as Business Ethics was written both at the peak of John Maxwell’s popularity and in response to a number of high profile corporate ethical failures (Enron, MCI WorldCom, Tyco, Adelphia, etc.). I only recently picked the book up when I had sold a box-load of books at the local Half Price Books and scanned the shelves for an interesting title I could buy with my paltry earnings. The book is 134 pages, but the pages are small and the type is large. Each of the 8 chapters can be read in 10–15 minutes, so the entire book could be consumed in a couple of hours.

If you want to know the key takeaway from the book, it’s quite simple: The Golden Rule (“So whatever you wish that others would do to you, do also to them, for this is the Law and the Prophets.” Matthew 7:12) is the only guideline necessary for business ethics.

It doesn’t take 134 pages to make that point. What makes the book worth reading is the 7 chapters plus conclusion that follow that observation. Each provides practical guidance for how to consistently put the Golden Rule into practice in your life and your work. Each chapter introduces it’s topic, uses a list of things we need to understand or practice, heavily relies on quotes from well known leaders throughout history, and uses helpful examples to show what good and bad behavior looks like.

Click here to read the full review.

Last week I wrote that sometimes an early stage startup simply doesn’t have what it takes to single-handedly create a new category. The first example I recall of watching that happen first-hand was at the birth of what we now know as the Internet.

Towards the end of the 1980s and beginning of the 1990s (even before the Web was invented) more and more companies were looking for ways to leverage the global connectivity that the Internet provided. It was becoming apparent that some commercial form of the network would emerge. IBM and MCI were anxious to monetize the investment they’d made in building and operating the NSFnet backbone. Both companies thought the current model of telecommunications worked just fine. They wanted to build a commercial Internet modeled on the status quo with toll gates and usage-based billing.

At the same time entrepreneurs were developing a very different vision for a commercial Internet. UUNET and PSInet recognized that the world was changing. Packet switching was riding Moore’s Law to drive the cost of connectivity towards zero and new applications were emerging that would drive network utilization exponentially higher. Metering the Internet would limit both usage and innovation. Their vision for the commercial Internet was not just better, it was different. It was a new category, not just a new service in the old category.

But how could these early stage startups hope to challenge the status quo, change the thinking at government bureaucracies like the NSF, and take on corporate giants like IBM and MCI? By themselves, they didn’t stand a chance.

Click the link below to read my story of how they formed a coalition to challenge the status quo. I believe that the Internet would be very different today if those early stage startups hadn’t joined together to establish the Commercial Internet category. I am thankful that otherwise fierce rivals were willing to come together to establish the better and different vision that they shared.

Read the full story here.

Creating a new category is a long, hard, and expensive process. In the best cases, customers quickly see the value in the new category, change their ways, and adopt the new way of doing things. Even these seeming overnight success are the results of years of innovation and foundation building. They take time and a lot of money.

However, when the target customers are risk averse and the category creators are early stage startups, an innovator may simply not have what it takes to establish the category on their own. 

For example, IT decision makers at large corporations are, almost by definition, risk averse. A big part of their job is to make sure that the company’s information infrastructure is always available. They are always busy behind the scenes keeping everything running well. No one notices when IT does their job well and everything runs as expected, but as soon as something fails, everyone starts pointing fingers at IT. Therefore, IT leaders often live by the mantra “if it ain’t broke, don’t fix it.” They are reticent to make changes, especially when those innovations come from unproven new vendors. By sticking with the long established industry “best practices”, even if something does go wrong, the IT leaders can claim that they did everything “right.”

So, what does it take to change their minds? Category makers need to develop a compelling story that explains why the long established industry standards no longer work or will soon cause major problems. They need to educate IT buyers on how their technology overcomes these challenges, and they need to convince those buyers that implementing their new solution is actually the lowest risk option for buyers. They then need to tell that story over and over again through multiple platforms with a high level of consistency so that it starts to sink in and eventually become ingrained in how potential buyers think about the future.

But early stage startups lack the three things most critical to creating credibility and trust with potential customers. First, they haven’t established their brand. Customers have never heard of them. They have no reputation and there’s no reason for customers to take a chance on them. Second, early stage startups often offer a relatively small part of the total solution. IT decision makers will need to combine the startup’s part with parts from other vendors to have a complete solution to replace the status quo. That increases both the effort and the risk for the IT leaders and often simply isn’t worth it. Third, telling the story loudly, persistently, and consistently will typically require a level of investment well beyond the resources of an early stage startup.

A powerful move to overcome these challenges is for startups to pull together into a coalition to clearly establish the viability and value of the new category in the minds of IT decision makers. Together these startups should develop one consistent compelling story that each can each tell over and over again to awaken potential buyers to the risks they are already taking and to position the new category as a great solution. Their combined voices create greater credibility and their combined spending creates greater reach. The unique capabilities each startup brings to the table adds to the overall value of the category, providing a more complete solution for the customer.

Click the link below to read my full article on what this looks like in practice.

Let me know if you need any help on your category making journey, whether that be on your own or as part of a coalition.

https://clearpurpose.media/when-it-takes-collaboration-to-create-a-category-94939a81f72?sk=9826c23394d236b1a7968b39df1171ed

As I continue my tour of classic books that I haven’t previously reviewed, this week I come to Every Good Endeavor by pastor Tim Keller with Katherine Alsdorf.

With Keller’s passing earlier this year, it seemed like the right time to pick this book back up and read it from beginning to end. Keller was a talented and accomplished writer, but he was really a pastor at heart. At times, the content comes across as sermons on specific passages of scripture. At other times, the pastor seems to be encouraging his flock as a trusted counselor. The book as a whole tells a complete story that follows the Bible’s complete story. 

Every Good Endeavor provides a gospel-centered framework for understanding why work is good, why it is challenged, and how it can be redeemed for the glory of God. For Christians, the book provides fresh insights and encouragement. It doesn’t provide simple checklists for how to “connect your work to God’s work” but will cause you to think deeply and differently about why your work matters and how you can approach it with a new perspective.

Read my complete chapter-by-chapter review here.