CEOs aren’t schizophrenic
To be an Internet company, it seems you need to speak Internet
I hold a guest lecture for Masters Students in Telecommunications Engineering at UCL, my University. It’s a privilege to be asked, and I get to step back and think — not least because my analysis and arguments have to be so much more rugged than on Twitter. My students are smarter than me.
It is a technical audience, but sometimes I decide to go into business culture. Last time, I compared how ‘new’ Internet companies compare to ‘old’ telecommunications companies.
Here’s what I said :
Take the annual reports of a random selection of telecommunications and internet companies. Count the number of references to product, product development, intellectual property, and interactions with 3rd parties. Catalogue the references to time : words such as ’quarterly, annually, iterations, target dates for the future’ . List the various stakeholders : employees, partners. And finally see how often and in which context the word ‘customer’ appears.
My analysis astounded even me.
Telecommunications companies, even ‘new’ telcos have a completely different vocabulary. Telcos are obsessed by investment, by reach, by competitors and by cycle times measured in half and whole years. The graphs and figures shown relate to capex, personnel, growth and profitability. The CEO report typically finds the reason why the company is doing more or less what it said, financially, and the message is that investor funds are safe. The company’s position in the market is stable. As number one, two or even as a ‘nimble challenger’.
The most telling is the dashboard that the CEOs report. For a telco, it’s always the same : customer numbers, ARPU and EBITDA.
One thing that’s never mentioned is the product.
Internet companies speak a different language — reports cover growth, reach and potential. Cohort graphs are the centre of the discussions They speak about product. They talk about product releases and features. User stories that make you feel good. But above all, they ooze constant iteration, finding the new and better markets. The dashboards talk about customer engagement, growth and retention. Overarching is a belief that the company can become the iconic symbol of its industry.
This dream is the oxygen for the entrepreneurs and leaders of the Internet companies.
Telecommunications companies are set very different goals by their stakeholders — stakeholders who have invested large sums, expecting reliable and solid returns over many years. The product interests them less, because they know the demand will be there and the licensing isolates from immediately competitive or disruptive pressure. They have great businesses.
But these stakeholders don’t want to dream
This is why the two types of business can’t sit in the same organisation. Their dashboards are different, the top three tasks that fill the day of the CEO, and the bulk of their staff are simply different. To try to do two different things at the same time would be schizophrenic.
And the CEO of a company can be many things, but he never succeeds as a a schizophrene.
