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  • Retro-Reading

    Posted by David Foster on October 26th, 2009 (All posts by )

    It’s interesting to pick up a copy of a business magazine from 10 years ago or more and look at what was then hot and at the predictions that were being made–and how well they stood up with the passage of time.

    Forbes ASAP (4/6/98) carried an article by George Gilder, in which he asserts that companies will increasingly compete by understanding that the customer’s time is a valuable resource–and making it possible to do business with them without wasting it.

    The fact is that the entire economy is riddled with time-wasting routines and regimes that squander much of the time of the average customer. Suffice it to say that the concept of the customer’s life span as a crucially precious resource, indeed the most precious resource in the information economy, has not penetrated to many of the major business and governmental institutions in the United States, let alone overseas.

    The message of the telecosm is that this era is over, as dead as slavery in 1865. These lingering attitudes in established busineses and government offer the largest opportunities for new companies and strategies in the information age.

    Gilder is an astute and creative guy, and I think he was right about the competitive opportunities that exist in optimizing the use of the customer’s time. He was wrong, however, that there would be rapid improvement in this area. Most companies, and most government agencies, are still terrible in this area–indeed, the dramatic increase in micromanagement of customer service personnel, combined with extensive use of preprogrammed blather, actually probably represents a regression in the effective use of customer time.

    Gilder also identified television as a major time-waster:

    You sit down on a couch in front of a screen to watch degrading and titillating lowest common denominator schlock, scheduled for you in some netherworld between Madison Avenue, the FCC, and Hollywood…some preening as “news and some leering as entertainment, for as much as seven hours a day…all in order to grab your eyeballs for a few minutes of carefully crafted advertising images that you don’t want to see, of products that you will never buy.

    …and went on to suggest that information technology will make it more possible for people to see the programs they really want to see, and be presented with advertising for products that might actually be relevant to them.

    Which of course has turned out to be substantially correct, with the emergence of services like Netflix and Internet video (and blogs!)…although meaningful targeting of Internet advertising still has a long way to go.

    But as far as companies making themselves easier to do business with, and showing more respect for the time of their customers, Gilder was way over-optimistic.

     

    7 Responses to “Retro-Reading”

    1. Michael Kennedy Says:

      Futurists always seem to be overly optimistic about how quickly things change. Arthur Clarke thought we’d be on the moon by 2001. On the other hand, the geostationary satellite came pretty quickly.

    2. Anonymous Says:

      Amazon, anybody? It’s hard to imagine a more customer-time-sparing experience than they deliver. Combine that with Prime shipping, and you’ve got a pretty efficient combo.

      And plenty of other places have really enhanced their customer experience via their websites, even if you need to actually buy the stuff in the local store (e.g. oil-based paint that otherwise incur a hazmat shipping fee, or that something that you need this afternoon, not a few days from now.) Whether it’s an el cheapo place like Harbor Freight Tools, or something higher end like Fisheries Supply, the ability to walk in the door and have a printout with picture and their exact SKU in hand is enormously time-saving.

    3. Kirk Parker Says:

      Oops, how did *I* get to be ‘anonymous’?

    4. Carl from Chicago Says:

      I think we are finally starting to get some time saving in with the iphone and web based apps. It is easy to summon a taxi on your iphone and in Chicago we can finally see exactly when the bus is coming. Through general information technology and the web you can also mostly avoid going to the government facility to pay property taxes and the like (although you have to go for your drivers license).

      Not only is amazon a time saver it enables you to compare a wide variety of products by the “what other bought” feature and online reviews.

      one item I think guys like gilder didn’t predict is that the best “content” wouldn’t come from the companies – it comes from users who the companies don’t pay, such as product reviews and specialist sites. Also the detailed support forums that spring up around almost anything on the web.

      also fantasy sports wouldn’t be such a big business if it wasn’t automated online, but that is probably a big net drag on productivity. I remember when they used to do it by hand.

      All the savings seem to be eaten up by an explosion of new content and new TV, though.

    5. Shannon Love Says:

      Apple is a company that has a peculiarly strong relationship with its customers and its strong and growing profits are partially a result of that. Part of the Apple mystique is that people who work inside Apple believe themselves on a technological mission to improve the world. This kind of missionary zeal and dedication to the good of the customer infects almost everyone from the lowest employee up to Steve Jobs. Customers are more likely to have a pleasant experience dealing with Apple because doing right by the customers isn’t just part of the job at Apple its part of the mission. A lot of people come to work for Apple in the first place because they believed in the mission first.

      On the other hand, Apple is in many ways simply reciprocating what its customers give. It’s hard for a Dell or HP to build the same kind relationship when customers will jump brands to save minor amounts of money. Microsoft can’t build loyalty because most people who use Windows do so because they have to not because they have chosen to.

      You have to give loyalty to get loyalty and most consumers aren’t particularly loyal or tolerant of mistakes by most businesses. Both businesses and consumers have a “wants in it for me in the short term” type of thinking that is not conducive to long term reciprocal relationships. I think most businesses try to build such relationship with things like discount cards or preferred customer programs but I don’t think most customers are really interested.

      I think the best that businesses can do is instead of trying to milk every last cent from every interaction to instead try to focus on providing customers what they really need for slight premium. People will pay extra for reliability and predictability in goods and services. I think this is why Apple continues to grow and make money.

    6. david foster Says:

      Yes, there is plenty of useful, time-saving stuff that’s available on the web. But there are also a lot of absolutely unnecessary time-wasters that people are subjected to every day. And there are a lot of companies that don’t seem to recognize the importance of valuing the customer’s time.

      For example: almost every day, I get some sort of marketing material from Verizon pushing their FIOS (fiber to the home) connection. But I am disinclined to buy any more services from this company, because interactions (human & electronic) with this company (and its MCI subsidiary) have been so unpleasant. Maybe VZ should spend a little less time & money on their direct mail marketing and a little more on fixing their customer service problems.

    7. tehag Says:

      “You sit down on a couch in front of a screen to watch degrading and titillating lowest common denominator schlock”

      Isn’t this close to the idea that Shirkey repackaged: that people have time to write and produce arts and entertainment for the internet because TV’s day is done?