280 characters = Navel Gazing

Twitter’s move to test doubling the character limit of tweets this week can’t help but remind me of internal discussions we used to have 10 years ago at eBay around Item Title length. In hindsight those discussions were pure navel gazing and distracted us from the core issues our business faced. I fear Twitter is doing the same today.

55 Characters

eBay Search Results

eBay Search Results (circa 2008)

In the beginning when Pierre Omidyar built eBay to help his fiancée collect Pez dispensers on eBay (spoiler alert: this was startup lore more than truth) he placed a limit on the number of characters a seller could use in their title: 55 characters. This stuck for a number of years however sellers would often complain that they would like more space to describe their item. As we discussed it internally at the company several reasons emerged as to why it would be a bad idea:

  • It would erode listing fees like adding a second category (doubling listing fees) or adding a subtitle (50 cents). Remember these listing fees made up about a third of eBay’s revenue at that time (balance was final value fees, paypal transaction fees).
  • It would make search results less relevant. eBay at the time worked on a pure title search and so by allowing sellers to add more words would mean some items only tangentially related to the keywords would appear (thru keyword spamming).
  • It would be harder to visually scan. Both the item page and search results would be harder to read with a longer title. In face there was some concern that even the search results loading time would be adversely impacted.

eBay Logo Circa 2008And so it went on. The topic was discussed at length and always controversial. Eventually in 2011 the company decided to expand it to 80 characters to align with Amazon and other online retailers platforms. At that point the search infrastructure had improved tremendously and was able to still provide relevant results. Did it fundamentally change eBay’s business in the end or help in its battle with Amazon? No.

So what’s the big deal for Twitter?

I think the lesson here for Twitter is one of putting heir energy and focus on topics that really matter. For example they should focus on the fact that Twitter is a two-sided marketplace of publishers and readers. Publishers are looking for audience and to get their message out. Readers are looking for interesting topics from the general (celebrities, politicians, news) to the more nitch (product management, design). And yet the way it’s positioned is not nearly that clear–and this 280-char test isn’t helping.

Ironically Medium, who already has a much clearer two-sided value prop and now business model, is doing exactly this.

5 Questions to Ask Yourself before Applying to Business School

This time of year I often get asked by people for advice on whether they should apply to business school for an MBA. Over the years and many coffees with folks, I’ve settled on the following key questions…

MBA - Haas School of Business Diploma

  1. Why do I want an MBA? 
    I’ve heard of a number of reasons but they mostly seem to boil down to these three that draw people to consider one:
    Business Concepts — In your core curriculum you’ll learn the fundamentals of what makes companies succeed and fail mostly by studying case studies on past leaders and companies. You then may then focus during the second half of the program on on entrepreneurship, finance, strategy, or marketing concepts.
    Network – Connect with others in your program and the (potentially vast) alumni that preceded you. Thru the case-study method you’re going to learn as much from your classmates as you will from the lecturer. And after you graduate they people will be tremendous assets in business. 
    Brand – If you join a “top-tier” program it can give your resume additional strength that can help give you an edge and at least get you in the door for an interview. If it’s currently missing a top brand (a company or your undergrad) this can be one way to add one.
  2. Do people in your “dream job” have an MBA?
    A great technique is to have coffee with 4-5 people in the type of role you’d love to have in 5-10 years. Learn about their career path and what got them to where they are today. For me at the time, a number of the people shaping product at successfully scaled Silicon Valley companies had MBAs and in talking with them they recommended that I do the same—those that didn’t, as you might expect thought it wasn’t necessary. I also saw the design, product management, and business functions converging and thought an MBA would enable me to span those disciplines. 
     
  3. Full-time or Part-time?
    If you’re in your 20s, looking for a career change, or looking to launch a company in business school then a “normal” 2 year full-time program is probably best for you. It gives you the chance to close out what you were doing prior and really focus. However if you have a good job that’s teaching/paying you a lot or are looking to accellerate a career path you’re already on, you should also consider a “part-time” program (evening, weekend, executive programs). I found the advantage of “part-time” programs is that during class discussions instead of just “students” in the room, you’ll have engineers, doctors, marketers, and entrepreneurs all with a bit more “experience”. 
  4. What’s the Opportunity Cost?
    Earning an MBA will cost you a large amount of time and money. To effectively evaluate the benefits of an MBA think about what else you could do with that same investment. Start a company? Invest in stocks or real estate? Continue in a great role? For me, the MBA cost me 20 hours a week and about $80K (then)— which meant no TV, fewer social events, and I would stay with my Honda Civic for years to come. Because I was able to continue full-time in my role at eBay I was able to continue to drive my career and benefit from stock options, all while learning how to round out my capabilities on Saturdays in school.
  5. Okay, now how do I get in?
    Put yourself in the role of the MBA admissions office. They want to select people that will be able to complete the degree and then go onto become wildly successful in business—bringing prestige and alumni donations back to the school. As you write your essays, think about why the school should “invest” in you—what will make you successful and how will you be an interesting addition to a cohort. 

As a graduate of UC Berkeley’s Haas School of Business (2008), I’m a huge fan of their program and in particular think their evening-weekend program is exceptionally well designed for people like me working in Silicon Valley on Product. 

Finally, if you’re looking for more advice, I also recently found venture capitalist Mark Suster’s 5 C’s on whether MBAs are Necessary for Startups to be helpful on what you gain and what you lose in seeking an MBA. 

Product Design and The Recession

One topic that continues to come up in discussions I’m having with colleagues, friends and family is the economy–what’s the macro-level impact of the recession we’re facing and how it may affect our industry. I’m somewhere in the middle on whether we’re looking at a deep 10 year recession or a shallow 12 month one. In this post I’ll explore those topics and the impact it will have on product management and design overall…

Impact on Internet Companies:

  • Investments without a foreseeable ROI will end
    Sequoia’s recently leaked RIP presentation to their portfolio of companies makes this point very clear for privately funded startups. Companies without a business model will not receive subsequent rounds of funding as there is a fixed amount of money left in the funds which invested in startups today–and it must last longer than previously expected as exits will be more difficult. Public companies are already under substantial pressure to reduce expenses inline with reduced top-line revenue growth (e.g. EBAY) and they’re most like to do that with questionable ROI investments and projects.
  • Expense reductions impact on overall wages
    These reductions should cause an overall contraction in the job market which will be reflected on all jobs including “product” and “design” jobs as most company’s approach a reduction in force in an across the board manor. This will also cause downward pressure on wages as more and more people will be looking for work perhaps equalizing what’s been an “employee’s market” in the design field for nearly a decade.
  • Backlash against outsourcing
    Reduced wages and a devalued dollar will create incentives for companies to hire locally in America. Furthermore, politicians will gain favor thru protectionist measures and may make it more difficult for companies to outsource jobs abroad. This will likely lead to a contraction in the outsourcing practice at least for US-based companies. Also some companies may focus on fewer, higher performing employees than lots of low costs employees (as Mike Spieser suggests).
  • Internet companies will begin to operate like “normal” companies
    This means a renewed focus on operational efficiency, profitability, and paying customers. Many firms may prioritize low-beta profitable investments over high-growth but longer-term investments. For startups focused on a long-term growth strategy it’ll be important to find a way to survive smaller and harder to get rounds of funding.

The role of Product Management and Design

The reality is now more than ever, businesses cannot afford to lose a ton of money on failed launches. When things were booming engineers could build solutions in search for problems–and some would stick and succeed.

In this environment the best way to mitigate risk is to rely on seasoned product folks to identify real customer pain points and then design a product that effectively meets those needs. Thru effective portfolio management you’ll also be able to evaluate your investment at several stages in order to mitigate risk. In that way you’ll be much more likely to succeed with the features and products your company launches.

Recommendations to Read:

Back of the Napkin

Back of the Napkin Book CoverI’ve mentioned Dan Roam’s visual thinking approach here before and you haven’t heard of him you should check him out. Congratulations to Dan on releasing his first book: The Back of the Napkin (available March 13th). He shared a pre-release copy with me in the fall and I must say it is going to be a seminal book in the visual thinking space.

At a high level he’s created a number of frameworks for approaching visualizations (e.g. sketches, charts). Here’s one that I find particularly useful in my day-to-day work:

  1. Look – Collect and scan your data. Decide what problem you’re trying to solve.
  2. See – Find patterns in the data (Who? What? When? How? Why?)
  3. Imagine – Describe your data by capturing it your “mind’s eye”.
  4. Show – Select the right framework (e.g. Measurement? Time line?)

Dan’s getting a lot of coverage in the press. Here’s some:

Making Meaning

After working with Darrel Rhea of Cheskin for the past few months, we invited him to speak to our design team this week on his recent book Making Meaning (co-wrote with Nathan Shedroff and Steve Diller).

At the core he speaks about how companies have three ways to create a long term strategic competitive advantage: strategic M&A, operational excellence, and organic growth. It’s the last of these three that design forms the cornerstone of success for he said “Design is the skill of identifying and creating value”.

Given that design is the key to organic growth, he went on to discuss what makes a great experience and introduced the following framework:

Diagram: Making Meaning

At the most basic levels, a product or service may simply fill a need. For example, perhaps I need to buy some salt (economic need) so that I can add it to some cookies I’m making (functional need). However for a brand to become truly meaningful it must create a meaningful experience. Perhaps using Morton brand salt to help me bake cookies with my son would evoke memories of baking with my mom growing up–a meaningful experience.

I think Darrel and others evangelizing creating customer experience through the design process are right on. The companies that embrace this thinking will do well in an age where meaningful experiences create loyal customers (and thus value for shareholders).

This fall one of my courses at Haas will focus on design and how as leaders we can leverage it as the key to innovation and growth. I look forward to learning more and sharing it here on this blog as well as my thoughts on the Making Meaning book which I just ordered.

UX role within Corporations

One of the sessions I attended last week at CHI2007 I found useful was moderated by Richard Anderson on the increasing the role of User Expeirence teams within business. He was joined by the following on a panel: Jeremy Ashley (Oracle), Justin Miller (eBay), Secil Watson (Wells Fargo), Shauna Eves (Blue Sheild), Jim Nieters (Cisco), Manfred Tscheligi (CURE). Here were some of what was discussed:

  • Documenting & Advocating User Experience — Yeah, not so much. Generic ROI arguments tend to be received as voodoo. Most agreed that sharing specific project successes was more successful, “The proof is in the pudding!” as Jeremy said. Only distention is early on to define the role of group in order to fit into the overall process. We should also avoid talking about work as a “black box” but work as a collaborative force within the org. I couldn’t agree more that we simply must deliver and the rest will take care of itself.
  • UX Owning User Experience — Early on yes, but later no. Jeremy emphatically stated that everyone is responsible for quality of which UX is a part. Justin mentioned how now at eBay, the entire company is involved in defining what the customer experience should be. Richard referred to his thoughts on owning design and also referenced a quote from Forrester in Jan 07, “Treat customer experience as a competence, not a function. Delivering great customer experiences isn’t something that a small group of people can do on their own — everyone in the company needs to be fully engaged in the effort.
  • Organizational Design — More important to understand how you fit in and how to best maximize it. Executive sponsorship who can involve you in the right discussions and decisions. In my experience having an advocate on Exec Staff can make or break your org’s role–you’re either involved in the inital conversations, or not.
  • Ethnographic Research — YES! Gets you executive access, builds credibility, and has a multi-year shelf life. Ridealongs and use of video is key as it gives the research credibility. We introduced these about 18 months ago at eBay and have seen it work quite effectively in focusing the organization more around customer issues and positioned our User Experience team to help solve it.

Richard also typed up some his thoughts on Moving UX into a Position of Corporate Influence [PDF].

Six Styles of Leadership

Daniel Goleman who writes on emotional intelligence, also lays out six distinct styles of leadership. Last week, Ryan Lahit of OrgLeader visited eBay to give my organization’s management team an overview of these concepts. I found this vocabulary useful in understanding and observing the styles of leadership I see in others.

Six Styles of Leadership:

  • Coercive (aka Directive) – Demands immediate compliance (telling)
  • Authoritative (aka Visionary) – Mobilizes people toward a vision (selling)
  • Affiliative – Creates harmony and builds emotional bonds (relationships)
  • Democratic – Building commitment thru participation (consensus)
  • Pacesetting – Sets high standards for performance (showing)
  • Coaching – Developing people for the future (supporting)

I think it is important to understand which style is most important given the situation as well as where the organization is in its development (more on this later).

Want to learn more?

Berkeley MBA moves up to #8 in BusinessWeek

Berkeley MBA LogoOn the heals of the Berkeley MBA’s rise in the WSJ ranking (to #5), the Haas School’s ranking moved up to #8, from #17 last year, in the annual BusinessWeek ranking.

The combination of a small class, exceptional faculty, and a collegial atmosphere impressed students. Recruiters, meanwhile, were wowed by the quality of the grads.

It’s great to have the outside validation of what I consider to be a great program. On a related note, I’m flattered to be featured in the school’s brochure this year. 🙂