Turbotodd

Yuchun Lee is vice president, Enterprise Marketing Management (EMM), in the Industry Solutions division, IBM Software Group. EMM is comprised of Coremetrics and Unica technologies, providing the foundation for solutions to help companies automate, manage, and accelerate core business processes across marketing and demand generation.

My partner-in-crime, Scott Laningham, sat down to chat with IBM VP and general manager, Unica co-founder, and former MIT card-counting guru, Yuchun Lee, about the opportunities presented by “smarter commerce” for companies everywhere at the IBM Smarter Commerce Global Summit.

In his keynote earlier this week, Lee explained that IBM now has a “more comprehensive suite for relevant and personalized offers, and an enhanced social media metrics capability” in the form of Unica Marketing Automation Tool v. 8.6, a capability that clients around the globe have been clamoring for.

The social buildout also incorporates enterprise analytics, tag management, and full mobile and social market capabilities that tie more closely together the marketing automation experience with the social realm.

Lee also explained in his keynote that many organizations must adjust their marketing cultures to fully capitalize on the Generation C culture.  They must build organizations that balance analytics and creative talents (easier said than done!), work with IT rather than around IT, and break down marketing siloes — digital and traditional marketing must consolidate and collaborate.

Words of wisdom from a former world-renowned blackjack player, and now, market thought leader in the realm of social/Web metrics and marketing automation.

Mark Frigon is a senior product manager with IBM’s Enterprise Marketing Management organization, a key group involved in leading IBM’s Smarter Commerce initiative. Mark’s specialties are in Web analytics (he joined IBM as part of its acquisition of Coremetrics) and Internet privacy, an issue that has come to the forefront in recent years for digital marketers around the globe.

Effective Web metrics are critical to the success of businesses looking to succeed in e-commerce and digital marketing these days, and IBM has a number of experts who spend a lot of their time in this area.

One of those here in Madrid at the IBM Smarter Commerce Global Summit, Mark Frigon, is a senior product manager for Web analytics in IBM’s Enterprise Marketing Management organization.

Mark sat down with me to discuss the changing nature of Web analytics, and how dramatically it has evolved as a discipline over the past few years, including the increased focus by marketers on “attribution,” the ability to directly correlate a Web marketing action and the desired result.

Mark also spoke at the event about the importance for digital marketers around the globe to be more privacy-aware, a topic we also discussed in our time together, calling out in particular the “Do-Not-Track” industry self-regulatory effort that intends to put privacy controls in the hands of consumers.

If you spend any time thinking about Internet privacy or Web analytics, or both, this is a conversation you won’t want to miss.

Maria Winans, IBM vice president, Industry Solutions Group, has helped champion IBM’s marketing strategy for its “Smarter Commerce” initiative, and has been instrumental in leading IBM’s efforts to reach beyond the traditional IT audience and into the “C-suite,” including most recently, to chief marketing officers.

Scott Laningham and I spoke to a number of IBM execs, partners, and subject matter experts at the IBM Smarter Commerce Global Summit this week, one of whom has been a key driver for IBM’s events catering to business executives.

Maria Winans is a vice president with IBM Software’s Industry Solutions group, and spent countless hours leading a team that prepared for the Madrid Summit, among others.

Maria and her team are laser-focused on helping take IBM software solutions to market by industry, centering their energy on a number of key verticals, including the retail and banking industries, among others.

Maria discussed a number of important issues in our conversation, including the trend towards communicating more with the “line-of-business” customer set, and the requisite changes that that is driving in IBM’s go-to-market efforts.

Jose Luis-Iribarren is a 25-year veteran of IBM who led the Olympics Web projects for the Atlanta Summer games in 1996, Nagano in 1998 and the Sydney games in 2000, where he received the IBM Chairman Award for his work. At the Institute of Knowledge Engineering, Jose Luis has most recently been applying Social Network Analysis techniques to e-marketing. His goal with that effort is to develop a quantitative model of information diffusion through online social networks.

The strangest things happen when you find yourself walking out of an elevator (or, as they call it here in Europe, a “lift”) in hotels halfway around the world.

In my case, I stumbled upon an old friend this morning, Jose Luis-Iribarren, a former IBMer and now social networks innovation manager with the Institute of Knowledge Engineering here in Madrid.

Jose Luis spent 25 years at IBM, where he led the creation of the first official Web Site for an Olympic Games for Atlanta in 1996.

I also had the opportunity to hear firsthand some of his experiences in “pathfinding” the early digital marketing milieu, as well as some fascinating stories about his experiences helping manage the Web (including learning about the “Bento Box” effect in the 1998 Nagano Olympic Winter Games).

It was a far-ranging discussion about the cutting edge of digital marketing, and a great opportunity to renew the acquaintance of old friend.

And all because of the serendipity of an elevator, and the real-world network effect!

Brian Fetherstonhaugh, as the chairman and CEO of OgilvyOne Worldwide, has a unique vantage point on how brands are built, how corporate cultures are created, and what happens as the world goes digital. In the course of the past 25 years, Brian has worked hands-on with many of the world’s leading brands including, IBM, American Express, Cisco, Coca-Cola, Motorola, Unilever, Nestlé, Kodak, and Yahoo! Today, Brian leads OgilvyOne Worldwide, the interactive marketing and consulting arm of the Ogilvy Group. With more than 4,000 staff in 50 countries, OgilvyOne is at the forefront of the digital revolution. In 2007 and 2009, the Forrester Report ranked Ogilvy as a leading U.S. interactive agency.

OgilvyOne Worldwide Chairman and CEO Brian Fetherstonhaugh started our Q&A today here at the IBM Smarter Commerce Global Summit in Madrid by revealing who his favorite character on the 1960s-era AMC show about advertising, “Mad Men,” was.  Drum roll, please….It’s…JOAN.

Mainly, Brian explained, because Joan “gets things done.”

We then turned our discussion to the vast evolution IBM’s own marketing culture has endured the past two decades, and the opportunities and challenges presented by the changing marketing landscape for CMOs, whose tenures these days last an average 27 months.

Brian also discussed other key issues facing chief marketing officers during this time of great change, including the need for CMOs to focus on new talents and skills development. Before he jetted off to another city somewhere in the world, Brian left the IBM Smarter Commerce Global Summit, and you, with some valuable marketing advice.

And when you watch the video, never mind the Spanish waiter who entered the frame for just a moment: He was simply doing what we wish to see companies everywhere do best, servicing their customers!

It’s one thing to hear from our capable IBM execs at events like the IBM Smarter Commerce Global Summit in Madrid.

Marriott’s vice president of consumer knowledge, Stephan Chase, explains to the gathered IBM Smarter Commerce Global Summit crowd in Madrid on Tuesday afternoon the secret to Marriott’s customer-centric approach in the hospitality industry.

It’s a whole other thing to hear from our customers, and that’s precisely what we were able to do in our general session yesterday afternoon.

Stephan Chase, who is the vice president for customer knowledge at Marriott International, took the stage at the Hotel Auditorium to explain how Marriott has come to adjust to a more data-centric world.

Chase started his talk with an anecdote about the cards his staff left in restrooms to encourage people to re-use their towels, with the vantage point differing on the meaning of the data like Kurosawa’s Seven Samurai — the story you got back depended on who was retelling it!

But, ultimately, Chase observed, the so-called “preference cascade” effect kicked in.  The cascade being that phenomenon where an individual thinks they’re the only one thinking something, or the only ones in their social circle, when, in fact, they discover there are plenty of others are thinking the same thing.

And, hence, they all start to change their behavior.

Yes, as it came to mind in my own head, it’s all very Malcolm Gladwell “Tipping Point-ish.”

Chase went on to explain that this phenomenon brings to mind that in the modern age, and particularly for hotels, but also more generally, it’s become even more important that what you do is much more important than what you say.

Generation C will sniff out any inconsistency between the two, and it won’t matter what you write on the card or say in your commercial if your actual organizational behavior is not living up to your actions.

Chase then related a story about his grandmother, explaining she used to say that “we are all servants,” and that he didn’t understand what she meant until he’d worked for Marriott for a number of years, and recognizing that in the hospitality industry, he was in a service-oriented business where actions always spoke louder than words.

“When founder Bill Marriott created our first hotel in 1957, he had a saying,” Chase explained.  “Take care of the associate. And they’ll take care of the customer. And the customer will keep coming back.”

With that saying, Marriott went on to open some 3,700 hotels in 70 countries, and to this day, the company focuses on discovering and applying truth for the benefit of customer and company alike.

He explained there are three key factors in hospitality: Freedom of choice, transparent pricing and repeat and referral.  That is to say, there are plenty of hotels that will be price competitive, so the consumer has a lot of choice when it comes to hotels, and that there are very few monopolistic businesses.  In the hotel business in particular, the majority of their business are not with “one-time stayers,” but rather people who (hopefully) keep coming back.

Therefore, in our social-mediated world, “connected customers are the best customers: They have a broad set of experiences, provide valuable feedback, and are engaged in greater variety of channels,” whether that be via smartphone, landline Internet, or even phone.

Then, Chase shared a key insight of the Marriott customer base: “If you take a look at your customer base and you abstract out their future value, I bet you’d find something: The broader the set of purchases and channels they engage with, the greater their future value!”

Therefore, Marriott’s Smarter Commerce evolution has been to focus on engaging the “connected” consumer to drive increased demand by delivering relevant messages to them, providing appropriate and relevant service, and also by recognizing milestones in the relationship (through points award programs and the like).

“If you do a good job of it,” Chase observed, “the customer will be more likely to come back. Thinking about the outcome (coming back), as opposed to the method (the marketing or service), is what will help keep you focused.”

With that, Chase left the IBM Smarter Commerce Global Summit audience with some actionable “to dos”:

1. Marketing should focus on WHAT to do — the IT organization should focus on HOW to do it

2. Focus on positive customer outcomes

3. Measure results, refine, and revise.

If you do those things, Chase concluded, you’ll realize some key lessons learned that will provide long-term customer connections and a roadmap for success that will fit your culture for years to come.

IBM vice president Steve Cowley sits down with Scott and Todd at the IBM Smarter Commerce Global Summit in Madrid for a Q&A on all things Smarter Commerce, among other topics.

IBM vice president of worldwide sales, IBM Industry Solutions group, Steve Cowley, has worn a number of leadership hats at IBM, but most recently, he’s been busy helping make over the IBM Smarter Commerce play and help his global team take the Smarter Commerce solutions to market.

In his role, Steve is responsible for acquiring, growing and selling a portfolio of industry specific solutions to meet client’s needs in todays’ rapidly changing marketplace.  If you push him, he’ll also explain that he has a passion for Formula One racing

Previously, Steve was General Manager for IBM Central & Eastern Europe, Middle East and Africa, based in Dubai, where he was responsible for driving sales and helping clients to maximize their IT investments across the region.

Responsible for all of IBM’s business with some one hundred countries from the Czech Republic to Russia, all Africa and the Middle East, the CEEMEA region was at the heart of IBM’s Growth Markets strategy.

Scott and I queried Steve about a number of topics, including the evolution of the Smarter Commerce opportunity, what’s going on IBM’s growth markets, and the need for increased focus on enterprise mobile computing.

IBM vice president Mike Rhodin hit the stage this morning at the IBM Smarter Commerce Global Summit, with presenter emcee Jon Briggs introducing Mike as “the man who eats analytics for breakfast, lunch, and dinner.’

IBM senior vice president Mike Rhodin explains to the gathered audience in Madrid how the Smarter Commerce initiative was a logical and inevitable offshoot of IBM’s smarter planet campaign, one driven by the need for more insight- and action-driven analytics.

Rhodin’s talk was entitled “Transform Your Business Around the Customer,” again with the central theme of the Summit that if more businesses wanted to keep theirs, they would increasingly have to pivot their business around customer needs.

Rhodin indicated that he wanted to take a step backward from yesterday’s more outcome-driven discussion, and instead talk about “some of the foundational ideas that led us to Smarter Commerce.”

He explained that four years ago, IBM started a conversation about having a “smarter planet,” one increasingly instrumented, interconnected, and intelligent, and that since that time, “analytics emerged as a centerpiece across our entire portfolio.”

Rhodin joked that the financial crisis’ onslaught wasn’t the best time to launch a new marketing campaign, but then explained smarter planet wasn’t that, that it was a signal call heralding a new age of computing. That it was, in fact, the beginning of a movement that was going to happen “no matter what else happened in the world.”

The change this movement would bring was startling.  We saw the social media embraced in both the social, political, and, increasingly business realms, and we saw that the physical world was about to become digitized…to some degree, because of the crisis.

Scott Laningham and I sat down with Mike Rhodin in the Smarter Commerce Global Summit Solutions Center just after his keynote in Madrid here this morning to discuss the evolution of the Smarter Commerce initiative, and the opportunity it, and other emerging technologies such as IBM’s Watson, provide companies looking to become more analytics and data-driven.

Ergo, the world, and organizations, needed to better understand systemic risk in advance of its rearing its ugly head.  Hence, the need to instrument the world around us.

“Information was flowing around the planet at a breakneck speed,” Rhodin articulated, “and so there was another form of input to make business decisions that became apparent.”

“We also instrumented the virtual world,” he went on, “whereby understanding the sentiment of your employees, your partners, and other constituents was critical.”

Yet all this new data was overwhelming many. “It was growing at such a speed that people couldn’t read or process it with traditional means, and so that’s where analytics started to play a key role, and served as a foundation for Smarter Commerce.”

“This began what we’re classifying as the next generation of computing,” Rhodin went on to explain.  “We went through the age of ‘tabulating’ — we’re now entering the age of “information-based” computing.”

In this age, business outcomes are increasingly insight-driven, solutions are more intelligent, and technology is designed to be more and more cognitive.

“It’s not about understanding what happens, but rather, what you do about it, what actions you take,” Rhodin concluded.

With this explosion of data from a hyper-connected society of empowered consumers, we “must extract insight from our most important assets – employees and customers – through smarter analytics,” and the challenge, then, is to address the need for “volume, velocity, and veracity” to help find the right data amidst all those needles amidst all those haystacks.

And it’s a big series of haystacks and needles.  The data generated between the dawn of civilization and 2003 is now created every two days! Rhodin explained.

He went on: “These next gen systems are creating opportunities in IT we haven’t seen in 50 years.  But now, with all this information and analytics, and the march of globalization, we can start to automate areas of business we could never automate before. We can start to automate and make more intelligent the front-office areas of our business. Chief Financial Officers, CMOs, head of sales, HR…we can turn HR from a reactive to proactive process.”

“We’ve identified a new pattern of automation across industries, one whereby we can instrument, interconnect, and analyze more and more data about the world, and in the process unlock more and more valuable insight,” he explained. “We are infusing intelligent into the fabric  of organizational processes. This shift is as profound as the last evolution was to transaction processing and back office automation.”

The shift being, of course, a continual transition whereby today’s analytics evolves into tomorrow’s cognitive computing capability, where Watson-style technologies utilizing natural language processing and hypothesis-generating and adaptation and learning systems virtually reinvent the IT future.

“We can remake parts of industries that have been untouched by IT in the past,” Rhodin concluded.

When Scott Laningham and I sat down with Dr. Kareem Yusuf yesterday, we didn’t realize what we were bargaining for.  As IBM’s executive responsible for both strategy and mergers and acquisitions for the Industry Solutions Division, Kareem’s responsibilities range from the formulation and prioritization of strategic plays to the execution of M&A in support of the business strategy

Also central to Kareem’s responsibilities have been the Smarter Commerce and Smarter Cities initiatives, along with the acquisitions that have been executed to support them.

Prior to this role, Kareem was focused on Decision Support Systems for Civil Engineering construction as he completed his Ph.D from the University of Leeds, and also spent some time providing Level 3 support for IBM’s WebSphere MQ technology, specializing in Java-based messaging.

Our discussion was far-ranging, with Kareem providing a beautifully-worded explanation of IBM Software’s Smarter Commerce acquisition strategy, along with some words about the new Smarter Cities technology buyer (the Mayor, the Police Chief, etc.) and also an update on what IBM has been focusing on most recently around the Smarter Cities initiatives.

All this and more coming to a stadium near you and soon!

Just because I’m here in Madrid covering the IBM Smarter Commerce Global Summit doesn’t mean that there isn’t other important news emerging from back at the mother ship.

This year’s IBM CEO study reveals three new essential imperatives for changing the nature of business: Empowering employees through values, engaging customers as individuals, and amplifying innovation with partnerships.

In fact, there’s some major news that I always get excited to report on, and that’s the results from our annual CEO study.

The ink on the report is hardly dry and straight off the presses, but this year’s study of more than 1,700 CEOs from 64 countries and 18 industries has a headline that CEOs (and their C-level ilk) everywhere may be interested to hear: CEOs are changing the nature of work by adding a powerful dose of openness, transparency, and employee empowerment to the command-and-control ethos that has characterized the modern corporation for more than a century.

Now that, ladies and gentlemen, is a headline!

The study reveals that the advantages of this fast-moving trend are clear: Companies that outperform their peers are 30 percent more likely to identify openness — often characterized by a greater use of social media as a key enabler of collaboration and innovation — as a key influence on their organization.

Those “outperformers” are also embracing new models of working that tap into the collective intelligence of an organization and its networks to devise new ideas and solutions for increased profitability and growth.

For those of us who have been working in the social realm for some time now, we’re probably not exactly surprised to hear this news.  But to have it come from the lips and pencils of the CEOs themselves…well, change it is a comin’ and for many, has already arrived.

In order to forge those closer connections with customers, partners, and a new generation of employees in the future, CEOs plan to shift their focus from using e-mail and the phone as primary communication vehicles to using social networks as a new path for direct engagement.

Today, only 16 percent of CEOs are using social business platforms to connect with customers, but that number is poised to spike to 57 percent within the next three to five years.

And while social media is the least utilized of all customer interaction methods today, it stands to become the number two organizational engagement method within the next five years, a close second to face-to-face interactions.

Top Down To Bottom Up

With this news coming after decades of top-down control, this shift has substantial ramifications — not just for CEOs — but for their organizations, their managers and employees, and also for universities and business schools, not to mention we technology suppliers.

More than half of CEOs (53 percent) are planning to use technology to facilitate greater partnering and collaboration with outside organizations, while 52 percent are shifting their attention to promoting great internal collaboration.

Of course, greater openness doesn’t come without some risks.  Openness increases vulnerability. The Internet — especially through social networks — can provide a worldwide stage to any employee interaction, positive or negative. For organizations to operate effectively in this environment, employees must internalize and embody the organizations’ values and mission.

This also means organizations must equip employees with a set of guiding principles that they can use to empower everyday decision making. And championing collaborative innovation is not something CEOs are delegating to their HR leaders. According to the study’s findings, business executives are interested in leading by example.

That is, from the front.

Big Data Means Big Changes

Given the data explosion being witnessed by many organizations, CEOs also recognize the need for more sophisticated business analytics to mine the data being tracked online, on mobile phones and social media sites.

The traditional approach to understanding customers better has been to consolidate and analyze transactions and activities from across the entire organization. However, to remain relevant, CEOs must piece together a more holistic view of the customer based on how he or she engages the rest of the world, not just their organization.

The ability to drive value from data is strongly correlated with performance. Outperforming organizations are twice as good as underperformers at accessing and drawing insights from data. Outperformers are also 84 percent better at translating those insights into real action.

From Theory to Action

This latest study is the fifth edition of IBM’s biennial Global CEO Study series.  To better understand the challenges and goals of today’s CEOs, IBM consultants met face-to-face with the largest-known sample of these executives between September 2011 and January 2012.

1,709 CEOs, general managers, and senior public sector leaders were interviewed around the world to better understand their future plans and challenges in an increasingly connected economy.

For access to the full study findings and case studies, please visit the IBM CEO Study website.

In the meantime, check out the video from Shell CEO Peter Voser to hear what he has to say about partnering to drive innovation.