27 August 2011

Nation Branding: Japan Stands Tall

Hot on the heels of the London riots and despairing stories of organised crime in Rio de Janeiro, comes this inspiring account of honesty and extraordinary civic-mindedness from the other side of the globe: the return of hundreds of safes and valuables to their owners in the aftermath of the Japanese tsunami.

Thousands of wallets and purses containing almost $30 million have been found in the debris and turned in by rescue workers and residents scouring the devastated prefectures of Iwate, Miyagi and Fukushima ravaged by a mighty tsunami that hit Japan on 11th March. 5,700 safes have also been washed ashore during that time. To date, about $78 million in cash and valuables have been reunited with their owners, often after arduous efforts to crack open the safes, dry and document the contents, then painstakingly track down the owners housed in hundreds of temporary shelters.

Japan Inc. may be battered and its credit rating downgraded; but its people have made the country proud and the world sit up and take notice of:

1. The Calm: Not a single image of chest-beating or wild grief captured by any newspaper, who showed magnificent restraint in their bulletins. No silly reporters. Only respectful reportage. Sorrow itself was elevated.

2. The Dignity: Disciplined queues for water and groceries. No honking and no overtaking on the roads. Not a rough word or a crude gesture. Just patience, courtesy and fortitude in the face of catastrophe.

3. The Grace: Restaurants cut prices. The strong cared for the weak. No looting in shops. People bought only what they needed for the present, so everybody could get something.

4. The Training: The old and the children, everyone knew exactly what to do. And they did just that. Hundreds of telephone agents from insurance company Aflac in Tokyo stayed at their stations and responded to customer calls from under their desks even as their office tower shook violently from the earthquake that followed the tsunami. 

5.The Sacrifice: The Fukushima Fifty stayed on selflessly at their stricken nuclear plant to pump seawater to cool the reactors, in spite of the grave risks to their own lives. How will these courageous workers ever be repaid?

6.The Honesty: When the power went off in stores, people put things back on the shelves and left quietly. Now with the return of the safes and valuables, ordinary Japanese citizens, in demonstrating their social and cultural values as a nation, are bringing out their best selves.

We should all be humbled and inspired.

21 August 2011

HP Ditches Its Most Personal Brand Asset

I vividly remember the goosebumps I felt while working late at the office one night almost 10 years ago, when I first read a memo from my then-CEO Carly Fiorina about HP's big, hairy, audiacious goal to acquire Compaq. As we know, HP went on to complete the deal, laying the strategic foundations for subsequent CEO Mark Hurd to execute and drive HP to its market-leading position today.

So you can imagine my surpise and sadness to read, two days ago, of HP's plan to shed its mobile devices and PC businesses.

Now this isn't some rinky-dink wannabe trying to stand toe-to-toe with the PC giants out there. We're talking about a company that sold US$41 billion worth of PCs in 2010, and achieved an 18% market share in the 2nd quarter of this year (which, incidentally, made it the market leader by far -- Dell came in at #2 with a 13% share).

Why would an undisputed market leader surrender its dominance while seemingly at the top of its game?

Industry analysts trot out a justification cribsheet that seems, at first glance, to make sense: Razor-thin margins in a largely commoditized market; abysmal sales of its TouchPad tablet launched in July; a predisposition by current CEO Leo Apotheker to bare his software fangs and move HP to a higher-margin business and (to use that odious euphemism) "unlock shareholder value".

And yet -- I wonder if those who hail this move have fully considered two things:

The first, is what I'd call negative ROM (return on morale).  HP's Personal Systems Group (PSG), who up until this week were internally regarded as rock stars for turning around a struggling division by "making the computer personal again", have had the wind knocked out of their sails. Why, the company has discontinued its much-touted TouchPad, introduced only last month; and pulled it off the shelves in Australia just four days after their national launch.  You don't change tack so abruptly externally without torching the ground internally. A whole bunch of demoralised employees are going to quit and leave -- or even worse, quit and stay.

The second observation, is that HP is jettisioning its most critically vital brand touchpoint. For the past decade, HP has arguably been the only technology company with the breadth of products and services to engage consumers, SMEs and the enterprise segments. But the bulk of its brand-building potential has always resided in the consumer space. This business is transactional in nature (win a prospect over quickly, and repeat millions of time over; as opposed to clinching a BPO contract with one corporation after an 18-month pursuit). But perhaps even more importantly, SME and enterprise decision-makers are also consumers after hours; and they interact with their consumer products far more frequently (how many times have you used your smartphone today?) than with their corporate purchases (how many times have you pulled out your outsourcing contract lately to admire the fine print?)  By ditching its PC business, HP is relinquishing the countless opportunities it would have, each and every day, to delight its customers and exceed their expectations through the most personal of devices in its armoury. (Next to the mobile phone, a PC has the best chance to be at arm's length, more so than a printer or blade server.) 

Banks demonstrate their grasp of this fundamental tenet when they put real effort behind their credit card business. They know that in a world of 360-degree branding, it pays to know which 36 degrees count the most.

Will HP turn around its supertanker, and find traction with this new strategic tack?  To be clear, computing will carry on.  It's just that increasingly, it won't be on a computer.

The hallways of history are filled with portraits of companies which have turned their brands and businesses around (think Apple, Xerox, Target, Gillette, Tesco, Burberry, Samsung, Nissan and Ford, to name a few) and littered with the remains of several that haven't (Digital, Wang, Ericsson, Polaroid, Sunbeam, Saturn, Borders and Blockbuster come to mind). Time will tell if HP's big bet on business strategy is founded on a compelling brand strategy.  I have to admit, I can't seem to find any.