Posts about companies

The temporary, pop-up corporation

A stat I heard repeated all over Davos: that the average lifespan of a Fortune 500 company is now 15 years, according to Cisco’s John Chambers. Trying to confirm that figure, I found others saying the number is less than 50.

Whatever. It’s far from forever.

So what if corporations more and more become short-lived enterprises? What would that mean?

Consider that Kodak just announced that 124 years after it started, it will stop making cameras. GM and Chrysler a mess of banks would have died, if they weren’t too big to fail. Borders and and Circuit City and Blockbuster and giant retailers are dead. Whole industries are dying.

Now consider that Kickstarter just passed a key milestone: two projects garnering more than $1 million in … what do we call it? … contributions? purchases? investments? We don’t have the right name yet for orders received before a company starts and a product is made. We don’t have a name for a company founded on its customers’ capital.

I have been arguing that vertical industries will be replaced by horizontal ecosystems made up of three layers: (1) platforms that enable (2) entrepreneurial ventures to be created at low cost and risk and (3) networks (e.g., ad networks) that, when needed, bring these ventures together to reach the critical mass that firms used to provide.

Of course, enterprises today can start with no need to build factories (use someone else’s) or distribution (plenty of that, for now) or technology (use the cloud) or marketing (let your customers do it for you) or design (let your customers help) or retail outlets (they’re dying anyway) or capital (see above). We know that this new architecture of the economy means enterprises can be launched with less investment, risk, and effort.

But consider that it also means that enterprises can disappear without leaving much of a hole. The guy who made the Kickstarter-backed iPod Nano watchband, who raised almost $1 million and guaranteed himself success (so long as he priced the product right), can keep making it until it isn’t hot anymore and then just do something else. No need to worry about long-term return on investment; no need to fret over feeding a factory-full of workers. Bermuda, here he comes.

But that’s not how our economy is built. How often do you hear that the wise person invests for the long term? Well, what’s long-term now? A generation? A decade? A few months?

If this is the case, then the platforms that make this temporary economy possible — Amazon and its web services, eBay and its retail chain, FedEx and its distribution chain, Google and Facebook and their marketing power — will be the best long-term plays. That’s why VCs keep saying they want to invest in platforms. But there’s only so many of those.

Of course, the problem for VCs in the last decade has been that start-ups just don’t need them as much as they used to. That will be ever more the case. Now the rest of us will know how the VCs feel. Where can you put our money if you’re an investment fund or a pension fund or a plain investor? Where will equity grow? Will it? I wish to hell I knew.

I’ve also been arguing lately that technology is leading to efficiency over growth. That, too, means that it will be difficult to find new jobs and equity growth.

Oh, there will be wealth. Witness Facebook’s IPO. But consider that Facebook serves soon a billion people with a staff the size of a metro newspaper company and they will end up with much greater wealth in fewer hands. Technology will not solve the economic imbalance of the 1 percent but make it worse, unless you’re one of those 3,000 employees of the platform or you manage to start a new company — likely a temporary, pop-up company — on top of it.

Dear Verizon,

I have a simple, helpful suggestion for you:

Put your technician assignments online for customers to see so we can judge when we need to be home and so we don’t get mad at you for having to stay home all day.

Our internet went out after the storms in New Jersey. We were lucky: We lost big trees but they only scraped our house and didn’t take out lines. We lost power and heat but I managed to get the last hotel rooms in the area so we had warm beds. Our power was restored after about 36 hours (many around us in the state still don’t have it) and with power we also got our phone and TV back. But our internet didn’t return. Not so bad. Troubleshooting over the phone with my wife for an hour yielded nothing, so we were told we had to have a visit. But the storm damage was widespread and Verizon was going to take two weeks to come. Internet being lifeblood to me — imagine me Twitterless — I appealed for help to @verizonsupport and they quickly and nicely gave us an appointment after only a few days. That came yesterday.

We were told we were to be the first appointment of the day. So my wife didn’t go out to restock the refrigerator, which was high priority. She waited. She waited 10 hours for the technician to come.

When he came, he said that we weren’t first on his schedule; he had an install, and we know from the effort that went into ours that that takes time. Then his dispatcher inserted another appointment before us. That’s fine, of course. Things are crazy in New Jersey right now. We don’t mind waiting. We just want to know how long to wait.

So here’s my suggestion, Verizon: Go to the Apple store and see the screen that tells customers where they are in line. When you see you’re No. 6, you know you have time to duck out to Starbucks. Apple doesn’t guarantee an exact time — and I know you hate doing that. But Apple gives us enough information so we can know what’s going on and make our own judgments.

Now go to Continental Airlines, look up flight status, and see that they give fliers the complete stand-by list for seats and upgrades. You can see how many seats are open and how many people are ahead of you so you can judge your odds. Again, they give us information. There’s no reason not to. I wrote about this in Public Parts as a simple example of a company being more open. It improves our experience. It saves gate agents from getting the same anxious questions over and over. (I hope this nice practice isn’t lost in Continental’s merger with United.)

So, Verizon, why not open up and simply let customers see a list of how many appointments a technician has and even where they are so we can judge how long it would take to arrive. Give more information when it’s helpful — e.g., that installs take a few hours. When things change, send an update, just as airlines now send SMS or email updates on flight status. You’re a communications company; I’ll bet you can do that well. If we’d had that yesterday, my wife could have spent the morning outside the house (and I wouldn’t feel so guilty for being in New York all day).

When the technician arrived, he was very good and spent time solving our problems with the internet and TVs. He replaced our router.

That leads to another suggestion: Wouldn’t it have been cheaper to send us a router? We’d have had it before the technician came, which means you could have saved the expense of our visit at a really crushed time. Worst case: It wouldn’t have fixed the problem and the appointment would have stood; the only loss would be the shipping cost.

These might seem like minor irritations to customers. But so was Bank of America’s $5 debit card fee. And look what happened to them. In this post, I attributed the bank’s retreat to a young woman’s online petition. But others perhaps rightly credited #occupywallstreet with stirring up productive anger at the banks and winning this small but symbolic and gratifying victory against them at a time of low trust and high contempt for banks in this country.

Friendly advice: You and the other telephone and cable companies could be in a similar boat. No surprise to you that there’s pent-up anger about you. In Public Parts, I tell this story about Frank Eliason, who started Comcast’s @comcastcares — a model for the very helpful @verizonsupport (he later came to New York to work for a bank):

“He was candid about Comcast’s problems, with a rare sense of corporate humor. I watched him at a event when he came onstage and said, “Customer service . . . . We’re well-known for service, aren’t we . . . . C’mon.” Pause for laugh. “We’re actually working very hard to improve the customers’ service.”

Now see Susan Crawford’s excellent piece for the Harvard Law and Policy Review, out this week, arguing that we are faced with a cable/phone duopoly over our internet access. It is a call to action for regulation of you. It is also, possibly, a focal point for anger about how we customers are imprisoned with our one or two choices.

So beware the seemingly small things — $5 debit cards, 10 hours of thumb-twiddling — can become rallying points for anger and organization against you. We, the community of customers, now have the tools to organize and be heard.

I’m grateful I got my appointment yesterday; thank you @verizonsupport. I’m grateful I got good service from your technician; thank you, Michael. I’m grateful to be using my internet connection at home right now to write this. I’ve also mellowed since Dell Hell. So I want to be helpful.

My helpful suggestion is: open up. If you know information that could be helpful to customers, share it — because now we have the tools that enable you to do that.

P.S. Yesterday was perhaps not the best day to notify us that our rates are going up.