Two weeks ago, our family went to Disneyland – the first visit for my 5 year-old girl, Fiona, and 3 year-old boy, Rowan. The kids were appropriately dumbfounded. They are still talking about how cool it was to see REAL Tinkerbell fly from the Matterhorm to the castle to start the fireworks show. They are still talking bragging to the checkers at the grocery store that they went on Thunder Mountain Railroad and Splash Mountain. Fiona is still dreamily recalling how wonderful it was to hug and banter with Belle, Ariel, Snow White, Cinderella and others at our “Disney Princess Breakfast” (Of course, poor Rowan thought that we were going to eat Disney Princesses, which explained his terror as we headed out that morning).

But I’m still talking about the trip too. What an amazing “product”.

1. Brilliant vision. Walt Disney had a vision for a family entertainment park that was so extensive and so complete, that even 50 years later, nothing has even come close to it in the world. Like Steve Jobs – or Ghandi or Martin Luther King Jr., for that matter – Walt Disney was “all in”. He wasn’t doing a job. He found his “calling” and his work was an unconditional commitment. He worked tirelessly – obsessively – to bring his vision to life.

2. A complete experience. Disney has thought of everything. For example, when you order you tickets in advance, you receive a “welcome packet” for the family to open together around the dinner table. Pins, pictures, magical coins, an array of gleaming, beautifully-designed credit-card-like tickets, each one with a different character on them, plus a hand-written note from the person who prepared the packet for us: “I sprinkled extra fairy dust on this packet so that your trip will be the happiest of all. Jesse”. OK, if you don’t have kids that will sound incredibly corny, but to the rest of you – you know. They make it easy and fun to buy the product (Disney Vacation packages), they build excitement before you even get access to the product, and deliver an experience which is really beyond your family’s wildest dreams.

3. Execution with excruciating attention to detail. When we entered the park on the first day, we used our gleaming, credit-card-like tickets to enter the Main Gate. You scan your ticket under a barcode reader, but instead of hearing “BEEP” or “EH!!!”, we heard “Tinkle tinkle ting!!!” – the sound of Tinkerbell’s magic wand. How cool is that? The next day, we eager ly pushed though the Main Gate for day 2, and when we scanned our tickets this time we heard Jimeney Cricket’s laugh. OK, so Disney called the barcode scanner vendor and said, “I don’t want a beep sound. I want a catalog of sounds that we can upload and cycle through at different times on different days”. How much did that add to the cost of their entry system? Which brings me to…

4. An obsessive focus on product, not profitability. After exploring caves on Tom Sawyer’s island one afternoon, we headed back via raft to the dock at New Orleans Square. As we came off the raft, I noticed a man, dressed in swarthy coats leaning against a fence, playing a penny whistle. He wasn’t talking to anyone or doing much. But his presence – the lonely sound of his instrument and his old tarnished, (Disney) pocketwatch – transformed the place. In fact, Walt even invested in details that very few people ever even noticed. “Hidden Mickeys” are everywhere in Disneyland and their spotters form an elite community of fanatics. . A cost-cutting consultant would show up at Disneyland and have a field day. But they don’t show up at Disneyland, which is the point.

5. Operational excellence. Disneyland hosts 14.7 million guests per year. It is open every day of the year, some nights closing at midnight and opening at 8am. And at 8am, every morning, the place is immaculate. Everything is where it should be. Every piece of trash is picked up (I checked one day – that little ice cream wrapper in the corner of the castle moat was indeed gone at 8am the next morning). No paint is ever faded. And every cast member is “on”. Who cleans the moat at 2am? And when does Tinkerbell practice her zip-line “flight” from Matterhorn to castle? There must be a fake Disneyland / training ground somewhere where she can train? The scale, scope and level of quality is inspiring.

6. A team of people who live the vision every day. “Ahoy sailors! Looks like good weather for our voyage!” We are genuinely, honestly greeted this way by cast member Paul as we weave our way closer to the Finding Nemo Submarine Adventure. He is not tired, but downright jolly – not the way most people look at 3pm on a work day. This is the result of rigorous hiring and training practices as well as creative scheduling and staffing – cast members do only short shifts on any given ride to prevent monotony from setting in.

Obviously, modern Disneyland is the way it is because of the efforts of thousands of people, but Walt Disney started it all and grew a team with a similar quest for perfection. The following quotes from Walt Disney sum up his leadership style and approach to “product development”.

“Disneyland is a work of love. We didn’t go into Disneyland just with the idea of making money.”

“When we consider a project, we really study it–not just the surface idea, but everything about it. And when we go into that new project, we believe in it all the way. We have confidence in our ability to do it right. And we work hard to do the best possible job.”

“Whenever I go on a ride, I’m always thinking of what’s wrong with the thing and how it can be improved.”

“I have been up against tough competition all my life. I wouldn’t know how to get along without it.”

“Disneyland will never be completed. It will continue to grow as long as there is imagination left in the world.”

Kids or no kids, I think it’s time to plan a trip to Disneyland…

Photo by rantfoil.

Hello, it’s Mathieu here, from France. I’ve been doing an internship with Scout Labs since January, and it’s exciting to be contributing to this very cool application. I’ve taken advantage of my time here by attending all sorts of hi-tech and entrepreneurship events happening here in sunny California.

I attended Startup School 2008 at Stanford University this past weekend. Startup school is an annual free conference organized by Y Combinator and BASES for hackers interested in creating their own startups. One of the most interesting and entertaining talks of the day was from David Heinemeier Hansson, creator of Ruby On Rails and founder of 37signals.

The most interesting advice he gave us was about how to make money online: Have a great product and define the right price for it. It’s interesting because it can be very hard to define the price of your great product, especially when it is sold as a service like a lot of software now (and like Scout Labs). You can fail at pricing your product correctly, and this is what happened to 37signals.

David told us that Backpack, one their applications, has been really successful (they doubled their revenues) in the last 2 months after they re-launched the application. They basically raised the price and changed their marketing message to target the long tail of businesses, what he calls the Fortune 5,000,000. You don’t have to aim at the Fortune 500, you don’t have to aim at the general consumer. There is a large and profitable market in the often-neglected long-tail, and software-as-a-service companies like Scout Labs are poised to capitalize on that opportunity.

You can find David’s talk below. All the videos from Startup School 08 are available on Omnisio.

I received an email today from a friend at a large, publicly held company, begging for access to Scout Labs. His story was so “typical” that I just had to, with his permission, comment on it. It seems the company in question just launched a version of its web-based software that just didn’t work very well and broke a bunch of things that used to work. A scathing article about the flubbed launch was written on an influential blog in their space. The post was seen by a partner to the company and was forwarded to a channel manager which finally made it to the executive team. The last few days have been hectic for the team — the post has been circulating around the company via email, the marketing team is trying to put a response together, they hastily hired a guy to be responsible for managing a “blog strategy”, and so on. Days later, and the company still hasn’t jumped in to the conversation.

This series of events is all too common. Some lessons that this real-life parable suggests:

• Obviously — don’t launch broken stuff. But even if there is a reason that you need to get something into the market that is not quite baked, be ready for it. Make sure your whole team is ready for it. Be prepared to explain why things are the way they are and what will come next. And ideally, be the first to state the obvious — don’t let customers “reveal” something, as if you had no idea it would be an issue. If there’s a problem, they will find it. Deal with it early. Get your team, tools, processes and policies in place now - don’t wait for a crisis.
• Listen regularly, and be prepared to do something about it. Don’t think about customers as people to deal with after your products are in market. They should be involved every step of the way, on an ongoing basis. Many of the complaints aired in this specific negative blog post were not just related to the recent launch, but were nagging issues that this influential customer had endured for months (years?). He would have liked to have been listened to all along.
• Be part of the conversation when times are good, and things will be easier to manage when times are bad. When you are an engaged part of your own community, customers get to know you. If you do it right, you become a trusted resource and you are seen as a real person trying his best. When things go bad, you will have “social capital” to draw on and get you through.
• Know your influencers and what they are saying about you at all times. Make sure you don’t hear this stuff, after the fact, from a customer or partner. And fighting fires days after the event makes a tough situation even worse.

If you have any additional lessons for my friend at this unnamed big company or to share your own painful experiences and lessons, please jump in and comment.

The guys at 37 Signals have a list of what they call “red flag” words that often come up in business communications and can get teams into trouble. Words like “only” and “can’t” (as in, it should only take you a day to add this feature, and we can’t ship the product without it) lead down rat holes of feature creep and finger pointing.

For me, one of those red flags is “what if…”

What ifs are the sparks that ultimately generate every interesting, fresh, unconventional idea. They are the stuff of all the brainstorm sessions and experiments that characterize the really exciting parts of the product development process. What ifs produce ideas, and ideas are easy, so when a team is in the slog of getting things done, it’s hard not to get way ahead of them with lots of big and interesting ideas. You start to anticipate every possible scenario and edge case. You think about ways your product might tap into new markets before you’ve even addressed its core market.

Ideas are also impatient. They pile up behind the older ideas, and they push and they push until a few get through. And then a few more, and a few more, and while you may have started with something simple, you now risk ending up with this (click image to enlarge):

You know you’re in trouble when your light switch requires written instructions (photo courtesy John Maeda).

On the other hand, what ifs can be part of a sanity check. Asking “what if…” can be like hitting the pause button, allowing you to step back, size things up and gauge whether they’re on track. What ifs can also help you subtract and simplify. It’s a great exercise to look at your ideas and ask, “what if we got rid of…” and “what if it just…”

I think the “It’s about time” clock is a great example of this kind of thinking:

These guys asked themselves how many people really need precision around what time it is and effectively said, “what if clocks only told you what you need to know - in plain English?”

This isn’t to say that thinking small is always better than thinking big. Each has its place, but either way, “what if…” is a phrase to look out for in business communications. When you hear it, make sure it’s leading you in the right direction.

The other day an analyst asked me about the different ways companies use Scout Labs-why they start using it, and all the ways they end up using it. It got me thinking about the evolution I see when companies decide to use a service to help them tune in to customers across the Internet. In fact, it reminds me Maslow’s Hierarchy of Needs. In 1943, Abraham Maslow developed his Hierarchy of Needs, a theory to explain human behavior. Maslow suggested that psychological needs are hierarchical, and you can’t move up the pyramid until the underlying psychological needs are met. Many have since challenged his strict hierarchy, pointing out several exceptions to the rule. But as a pop-culture metaphor, it helps describe the various ways companies use Scout Labs.

Here is Scout Labs’ version of the Hierarchy of Needs:

1. Find and fight fires (or CYA)

Many organizations get interested in consumer-generated media ( CGM for short) because they want to find fires – exploding laptops, rants from prominent bloggers, a rumor leak, a copyright violation – and fight them as quickly as possible. This is an absolutely essential use of a service like Scout Labs, and the reason why whatever service you select needs to

• Be real-time (so you can find those fires as they happen).
• Find the fires for you, prioritizing what’s important / worth paying attention to right now.
• Have email alerts built in.
• Help you quickly act mobilize your response.

In this day of highly vocal customers who areconnected to each other real-time and whose seething blog posts about you can show up within the first few results on Google, companies worry about the sheer volume of CGM and their lack of visibility into it. There are huge dollars at stake. Finding and fighting fires is a fundamental reason to Scout the Internet, and one that your organization has to feel comfortable with. This means you need to have confidence not only in the tool you use, but in your team’s judgment and ability to take action in time of threat.

2. Seek out product and marketing feedback

Once an organization gets good at finding and fighting fires, we see them start to listen even more closely to what customers are saying. Rather than only monitoring a few, huge problems and trying to solve them, companies start listening every day for insight they can use to improve products and marketing. What do customers like? What don’t they like? Why don’t they like it? What do people wish we would do differently? Scout Labs makes it easy to answer these questions. When a company evolves to the point where it really listens to customers in this way, we typically see corporate communications /PR, brand managers, product managers, and marketing folks all using Scout Labs together to helpbuild better products, inspired by the voice of the people.

3. Build relationships with customers

Only after a company is a good listener can it jump in and start building relationships with customers. I think of it like a game of jump rope. The customer conversation has its rhythm, pattern and players, and you don’t want to barge right in before getting the lay of the land – you’ll just get all tangled up. (Scout Labs lore: at one point we toyed with the idea of naming the company Double Dutch!) Watch for a while. Learn who the key influencers are. Get a feel for the language, the concerns, the issues. And when you’re ready, jump in. Be part of the conversation. Answer questions, ask questions, inform the best you can.

And if you have a service like Scout Labs that helps you facilitate this engagement – communicate with each other about it. Keep a record of it so that you have organizational memory around it. Track the impact of these customer connections. At that point your organization will be able to build relationships with customers on a mass scale. It’s not easy to evolve to this place. You have to really understand your customers and their communities before you can be welcomed in. AND you have to trust your employees to have these conversations and build these relationships. But if you can get there, the rewards are great.

4. Be a customer-centric organization

The apex for an individual, according to Maslow, is self-actualization –making the most of your abilities and striving to be the best you can be. For an organization that wants to listen to customers, the pinnacle is being a truly customer-centric organization. For a company at this stage of evolution, customers are partners. Listening to customers and engaging with them to build better products and sell more is a strategic priority and part of a company’s culture. Everyone – from the CEO to customer service reps – is tuned in to what customers are talking about, coming up with new, customer-inspired ideas, jumping into conversations to build relationships, and truly innovating.

Being a customer-centric organization is more than a nice-sounding aspiration. We believe it’s a strategic competitive advantage. Whoever listens better, innovates faster, and builds personal relationships with customers wins.

First came the Nature vs. Nurture debate: what makes us who we are? Is it nature — what our parents, at the moment of conception, brought to the genealogical table (or, bed, for those of us with more traditional parents)? Or is it where we lived and how those parents treated us in our early years and beyond? Then came the Taste Great, Less Filling conundrum. Today, at least in the web universe, rages the human versus machine controversy. At its core, the questions is: what returns the best, most relevant results (search results, relevant news, etc.)? Machine-generated algorithms or human “editors”? Google, with its mysterious search algorithms and millions of servers, is the poster-child for the “Machine” camp (although the reality is that their algorithms rely on human editors). In the “Wisdom of the Crowd” camp are the Web 2.0 likes of Digg, Wikipedia and del.icio.us. Like in the early days of the Nature vs. Nurture debate, (or Taste Great, Less Filling, for that matter) people are polarized over the issue — as if it’s one or the other. John Battelle sparked another round of debate on the matter just last week. Of course, the right answer is “both”.

Machines can do things that humans just can’t do very efficiently. They can process huge amounts of data very quickly (like the massive amounts of consumer-generated media that exist) . And machines don’t need to sleep or take latte breaks, so they can monitor things around the clock, in real-time. Of course, the categorizations and the kinds of processing that machines can do are very “gross” — they can count things, extract links, and look for patterns and run analyses that humans devise (like, say, an Influence algorithm or a Significance algorithm or patterns in language to determine sentiment). Machines can also count, measure and incorporate HUMAN (user) actions and behaviors — both explicit and implicit — along with the technical data, and that’s where the lines begin to blur and where things get interesting. So, we desperately need smart machines, directed by far-smarter humans, for complex things things like search or monitoring the voice of the customer out across the Internet.

But people, especially teams of like-minded people with a common purpose, can do what no machine could ever do — draw conclusions, add insight and strategize. Humans can add the “so what”. A founding belief of Scout Labs is “Let technology do what it does best, and people do what we do best. Together, we’re a pretty good team.” We have architected the service to offer the best of both worlds, working together seamlessly. Of course all this is a means to an end. Our users just want to know what stuff she needs to pay attention to right now and to collaborate with her team to do something about it. We are excited that very soon, everyone will get a chance to use Scout Labs and see Man and Machine working together in peace and harmony. Taste Great vs. Less Filling will still be there to fight about.

Did anyone catch this article about Radiohead’s groundbreaking marketing tactic of offering downloads of their new album online for ‘whatever you think it’s worth’?

I first heard about it a while back and thought it a significant example of major changes in the relationships between producers and consumers. The article spells it out well as it relates to the music business, but I can’t help but see the bigger metaphor for how the Internet and commercial use social media is radically altering our models for commercial exchange.

It used to be that you had a good idea and the first order of business was convince the folks who controlled the distribution in your industry that it was also a good idea. You might retain creative rights over the product, but the mechanics of getting it into the hands of consumers was complex, expensive and controlled by an elite few.

Radiohead astutely observed that 1.) the distribution mechanics of their industry was changing rapidly, and 2.) they were a strong enough band (brand) to take a chance on abandoning the old, slow and expensive model and going direct to the consumer.

What I really liked about this story is the description of what their creative process is like when they work through the old model of distribution with a major label. Their creative output was slow to get to market (albums take much longer to release), the promotional campaign (a tour) for selling the new product (album) was long and boring and kept them from what they really enjoyed the most—product innovation (writing and recording new music).

Getting closer to their fans (customers) allowed them to see what works immediately. A great example of early recording tapes tossed up on YouTube is given in the story. Rather than screaming about copyrights and trying to retain a death grip on brand perception, the band fully embraces the phenomenon of their art (product) being co-opted by the Internet Commons and rightly views it as a highly efficient, low cost feedback loop.

We often talk at Scout Labs about how getting closer to the consumer speeds up innovation. Hats off to Radiohead for progressive marketing innovation that ended up accelerating their product innovation as well in ways they never expected.

I recently re-watched YouTube founders Chad Hurley & Steve Chen interviewed by Chris Anderson from Wired at the Commonwealth Club (5/23/07). Watch the Video. It’s fun to hear about the dinner party where the idea was born (once again, they had a personal need that wasn’t being met — to share home-made videos with friends). They also talk about the early days of the company and how the rapid growth of the site caught them completely off guard. My favorite is a story they tell about an early functionality planning meeting, when they rejected the idea of needing any search functionality on the site. They really could not imagine their little “YouTube” ever hosting more videos than could fit on the first page.

Now this may be just good story-telling. I’m sure if you ask the Sequoia Capital folks who funded YouTube, they certainly expected the site to need search! But I love this story because you can make guesses about how users will use new product, you can even ask them how they will use it, but you never really know until you get it in their hands. Scout Labs has been working with many companies since day one. They’ve told us what they need, they’ve reviewed wire-frames, they’ve prioritized functionality, and told us how they thought they would use it. But now that they have a real live application in their hands, they are using Scout Labs for all sorts of things that we (or they) never imagined. They are loving some things that they were mildly excited aboout before, and of course, now they have a million more feature requests. But this is the fun part of building new products and why it is so important to let your customers be your guide. We’ll be doing just that for the next several months, prior to launch.