Bob Buday's blog

When we entered the thought leadership marketing business back in 1998, our clients rightly asked us what would make them thought leaders. We told them then, as we tell them now, that there are two pieces to the puzzle: great content and great marketing programs that implant that content in the minds of their audience. 

“But what makes content great?” we were asked. We said seven criteria -- focus, novelty, relevance, validity, practicality, rigor and clarity -- separate thought leaders from thought laggards. You can read that article here. We published that more than 10 years ago. Since then, others have issued their own list of content criteria, the most recent of which was from the insightful B2B marketing blogger Chris Koch. 

A decade later, we realize we left an important attribute off our list, one we haven’t seen on other lists. It’s the attribute of “coherence.” 

Our original seven hallmarks didn't ignore it altogether. We implied it in the attribute of “clarity” (which we defined as communicating a concept in language understood by the target audience). But coherence is a nuance of clarity, and as we’ve discovered one not well understood. By coherence, we mean that a great point of view simplifies a very complex problem and provides a clear solution to it. The Oxford English Dictionary defines coherence as “reasoning of which all the parts are consistent and hang well together.” 

The best way to bring coherence to a business issue that we’ve seen is to create a unifying theory – an overarching framework that explains the elements of an issue and how to solve it. Such frameworks decompose a problem and its solution into a few comprehensible elements. Michael Porter’s five forces of competition explained what made some markets attractive and others not. Reengineering guru Michael Hammer’s business system diamond articulated what companies needed to have super-efficient business processes. 

It’s now banal to say that complexity is increasing in business and society. But it’s true. Those who can do the very hard work of turning an extremely complex and critical problem into a simple and helpful solution capture minds. By enlightening, their ideas become highly engaging.

Albert Einstein once said, “It should be possible to explain the law of physics to a barmaid.” He believed complex issues needed to be simplified to be understood, and had to be understood to be acted upon. American jazz great Charles Mingus once remarked, “Making the simple complicated is commonplace; making the complicated simple, awesomely simple, that’s creativity.” 

When they tell customers how to solve a business problem, companies too must be able to make the very complex very simple. That’s what coherence – and the frameworks that generate it – are all about, and why they are so important.

How much have strong frameworks helped your audiences embrace your points of view?

As a long-ago graduate of Penn State (1977) who covered Joe Paterno and Jerry Sandusky’s football teams for the school newspaper, I feel the following goes without saying.

Sandusky’s alleged sexual abuse of boys, first and foremost, is an enormous tragedy for his victims. Their emotional health matters far more than does the university’s public image. The latter’s will recover somewhat over time if it conducts a thorough housecleaning and actually sticks to its newly issued code of ethics.

Second, everyone who is proved to be involved in the cover-up be will dogged for the rest of their lives by failing to show a conscience when it mattered, and perhaps big legal problems.

But if Penn State truly wants to demonstrate to the world that it is changing its ways – that its football program is no longer calling the shots for a weak administration – it needs to do more. Much more.

How about directing much of its $50 million-a-year in football profits to an educational program meant to prevent organizations (schools, churches, companies, etc.) from abusing people (sexually, emotionally, financially, etc.)? 

If Penn State really wants to mend its ways, show remorse for its disgraceful actions (or lack thereof), and demonstrate its capabilities as a research university, it should create an institute to shed new light on a problem with which it is now well familiar. There are plenty of organizations in addition to its own to research: the Catholic Church, the late Jim Jones, etc., etc.

Penn State's administration must reshape its long insular and arrogant culture. That's the first step. Concurrently, to repair its tarnished image Penn State should remember why it's in business: to create and impart knowledge. Since the scandal happened on its once-hallowed grounds, no other university than Penn State is in a better position to shed light on the roots of and remedies to institutional abuse.

The term “knowledge management” was big in the mid-1990s when big companies saw the need to share expertise beyond those proximate to it. A decade and a half later, the term “thought leadership marketing” is in vogue, and some see a connection between the two.

What prompted me to bring this up? Over the last year, we have been paying attention to a consulting firm called Knowledge Architecture. Given that KA is only two years old, a small firm, and on the opposite coast (in San Francisco), you might ask why.

In part, it’s because KA’s founder and CEO, Christopher Parsons, reached out to us. In part, it’s because he has a number of intriguing ideas and expertise that relate to our business. But perhaps most of all, it’s because we believe he is onto something in the sector he cares about: architecture, engineering firms and construction firms.

What Chris is passionate about is helping AEC companies compete on a basis that few of them are competing today: bottling knowledge about how to design and build buildings and inculcating it widely across an AEC firm. The ultimate goal, I presume, is to make the newest employee as proficient as the oldest.

Chris recently has noticed a glaring need to connect the disparate disciplines of knowledge management and thought leadership marketing. (I use the term “disciplines” loosely; in sophistication, I see both to be in their infancy.) He sees a connection that we have seen, although we have put it all under the moniker of thought leadership.

No matter. We, like Chris, believe that B2B firms of all types – especially professional firms – that excel at both knowledge management and thought leadership marketing, and (very important) connect the two, will have a distinct advantage. But that’s if they recognize they need it, which at this point is a big if for most.

Knowledge Architecture consults to architecture, engineering and construction firms about how to gather, codify and scale up the knowledge their architects and engineers bring to projects. KA also has a software product that helps with this process.  Chris, a former CIO at a mid-sized California architecture firm, believes these sectors must begin explicitly connecting what they do in knowledge management with what they do in thought leadership marketing. Not that most AEC firms are zealous about either. While Chris may be a bit ahead of his market, if the winds of technology and offshoring blow even harder in the next few years, he will have timed his sector right.

The reason is that Chris sees a rapid commoditization of the architecture and engineering work that flies off the drafting tables and CAD systems of Western AEC firms. With powerful but cheap computers, an even cheaper Internet, and capable workers in other countries enabling engineering drawings to be drafted and transmitted economically from Malaysia to a building site in Atlanta, Chris sees this scenario upending the tranquil world of Western AEC firms.

By “upending,” he means architecture projects shifting to lower-cost places where engineers and architects work (hint, hint -- not North America and Europe). Those that can’t compete on price will have to differentiate their services in other ways -- ways that matter to customers. If you can create superior ways of designing and engineering buildings – and in doing so, make those buildings far more valuable to their owners and occupants – then you have something that’s resistant to services offered at rock-bottom prices.

Chris has a framework that ties KM and TL together. My colleague Tim Parker referred to it in a recent blog post. In Chris’s model, the knowledge management function reviews projects, codifies methods that are used in practices, and conducts R&D on external practices (i.e., outside a firm) because no firm is the font of all knowledge on any topic. As Tim said of Chris’ model, “R&D helps them push the envelope in areas where they want to get ahead of the competition – especially areas where there is an unsatisfied need in the market.”

Thought leadership marketing uses the content that knowledge management collects to give prospective clients a flavor of the firm’s expertise -- a way to “sample the merchandise,” as they used to say in old gangster movies (although I remember it pronounced as “muychindice”).

Chris’ framework spurred me to update an old Bloom Group framework. First, I think most companies have viewed the content they produce for thought leadership marketing programs as serving only marketing purposes (i.e., the purpose of "increasing demand," as illustrated below). I have said for years that this content needs also to fuel the way they deliver their expertise – new approaches to doing their work, or even whole new services (i.e., "scaling up supply," the bottom part of the value chain below). Over the last 25 years, I have rarely seen firms get programmatic about the bottom part of the chain. As a result, they produce a lot of great ideas that few in their firms can actually deliver.

My perception of KM is that it is conducted in most companies by groups other than marketing – by at first an internal library function. KM, my perception goes, has continued to be an inward-looking endeavor – capturing the approaches and expertise of a firm’s professionals. Its use then continues to be internal: helping professionals deliver their expertise rather than let the world know about it.

Thought leadership historically has largely been conducted by marketing. As TLM became more sophisticated, firms have conducted more sophisticated data gathering – research studies featuring external best practices (not just internal) or even whole research programs with clients as annual subscribers.

Both versions are incomplete. Companies today need to gather best approaches/practices both within and outside their firms – particularly outside their firms because the rate of change in the marketplace can make a firm's methods obsolete far faster today. They then need not only to market it but bottle it and have many people in their firm who can master it.

So it’s time to erase the artificial boundary between content gathered through traditional KM (internal practices) and content based on external practices (TLM) and to look at all this as knowledge that firms need to gather, analyze, and turn into formal methods that reflect unique expertise.  Call this plain R&D – research of external and internal practices. The “D” is how you develop the content a) you use in your marketing programs, and b) that fuels new methods and services.

What do you think? Is it time to connect thought leadership marketing and knowledge management? If so, how would you do it?
 

My introductory post in this series laid out five elements of a thought leadership content machine. This post will go deeper on the first element: your ambition or purpose for such a function.

But before I talk about ambition, I need to clarify a key term here because its ambiguity contributes to the problem I’m going to probe in this post. That term is “content machine.” By this I mean the group(s) in a company charged with creating new ideas, ones that demonstrate the firm’s know-how in solving the business problems it solves. The content machine is the group that creates such content.

The people who take that content to market typically have a different skill set. Ghostwriters, PR people, events managers and the like are there to market thought-leading content, not to create it. Without them, a firm's best ideas remain relative secrets. But without compelling ideas, the marketers get little traction. Investments in marketing events, glossy management journals and high-priced PR firms are largely squandered. Content developers and marketers need each other. (They often complain about each other, but that's for another post.)

This series of blog posts is about content development, not content marketing. Over the last 25 years, I’ve observed that B2B companies are far less effective at developing content than they are at marketing content. Even B2B firms with research institutes can issue a stream of forgettable reports. Merely assigning a department the responsibility to make the company a thought leader  doesn’t necessarily mean it will follow.

The place where a great thought leadership content machine begins is with the right ambition. By this I mean chartering the thought leadership R&D function with two purposes: not just capturing the firm’s existing expertise but also creating new expertise – content that becomes the focus of new offerings and new marketing programs.

The vast majority of thought leadership functions I know of focus almost entirely on the former, on capturing the firm’s existing expertise. There are exceptions. Consulting giant McKinsey & Company captures the expertise of its consultants through its talented McKinsey Quarterly staff. They also conduct survey research, capitalizing on the firm’s database of 2 million McKinsey Quarterly readers.

But McKinsey doesn’t stop there. Through its McKinsey Global Institute, the firm creates content that goes beyond what its consultants learn in the field and what its Quarterly editors capture. The firm’s Global Institute has 10 people who direct and conduct macroeconomic and management research on topics in three broad categories -- competitiveness, productivity and growth.

How a firm develops content, what skills it needs to develop that content, and where those skills reside on its organizational chart all depend on the purpose that organization assigns its thought leadership content operations. Most important, that purpose or ambition will define whether the function is there to market existing offerings or create new offerings, or both (like McKinsey).

I’ve written about this before. Thought leadership needs to serve two masters: creating demand for existing expertise and creating supply for new expertise, to be packaged, converted to services, marketed and sold. Simply put, if your content R&D engine creates great content (and if your marketers market it well), you’ll likely attract a lot of clients. But that will soon end if clients find your firm can’t deliver on the wonderful ideas you seduced them with.

That reputation might take time to gain. Months may go by before word gets out that you can’t deliver on your market promises. For sure, it will take a lot less time today with social media. A bad reputation travels fast on Facebook, LinkedIn discussion groups, company review sites like GlassDoor.com and Vault.com, and Twitter.

A thought leadership content function needs to be charged with creating compelling concepts that generates more leads -- and new services. Making that happen starts by chartering your thought leadership R&D machine with the right ambition.
 

In just the last two years, we’ve been asked the same question by six very large B2B firms (two consulting, two IT services, one financial services and one software company): how build a thought leadership content machine.

By this, I mean creating a department of people who produce compelling content that demonstrates their firm’s expertise. No easy task, not even for the biggest consulting firms, the sector in which thought leadership marketing has been practiced the longest.

We presume we’ve been asked this question because there are few models to follow. While management consulting firms like McKinsey, Booz, and Bain regularly produce new, supported and engaging insights on an array of topics (although they can miss the mark too), they are exceptions.  The content published by most B2B firms – even most consulting firms – isn’t exceptional. And it’s not just our judgment. We’ve heard this in “voice of the customer” research we’ve conducted. We’ve also heard it in our surveys of professional services marketers over the last five years.

So why do few B2B firms have a thought leadership content machine that repeatedly issues strong content? In many cases, it’s not for lack of budget or expertise in the domains in which firms want to be seen as experts.  Rather, we believe it’s because they lack five elements:

• The right ambition for thought leadership – not just to develop, capture and market expertise that increases demand but also increases supply (new offerings and new approaches to delivering current offerings)
• Codified and therefore repeatable methods for producing intriguing ideas – a few big ones and many intriguing small ones.
• People with the still-too-rare skills of conducting research that unearths new, important insights on complex matters; drawing out the tacit or not fully formed knowledge of firm subject experts; and explaining that knowledge clearly to the great unwashed.
• Mechanisms for turning these ideas into effective marketing campaigns (to create both internal and external demand) and new or improved services (supply creation)
• Having these activities exist at the right place on the organization chart (i.e., not reporting to a function that will warp the purpose of the firm's thought leadership engine).

In five subsequent blog posts, we’ll provide more detail and examples of these five elements. In the meantime, feel free to comment on these posts about what aspects of creating a thought leadership engine you’d like to know about. We’ll make sure we address them.
 

It will sound like circular logic, but it still needs to be said: Great thoughts are the foundation of highly successful thought leadership marketing campaigns. Yes, you need skillful and concerted marketing to distribute those great thoughts widely. But you can invest a lot in marketing some idea and come up empty if your point of view is shallow, has been heard before, and lacks substantiation.

I know lots of people who, with varying degrees of success, are trying to get their boss behind thought leadership marketing and raise their organization’s investment in it. I can assure you the more successful ones get attention by being crystal clear about the “why”: "We should do this to generate leads and revenue." When they see soft benefits thrown at them, CEOs, CFOs and even some CMOs tune them out like they do their mother-in-law.  Want to make their eyes close? Use words such as “enhanced reputation,” “cachet,” “speaking engagements,” or “market buzz.”

In a previous post, I laid out four stages that professional services and other B2B firms go through in becoming thought leaders (Stone Age, Medieval, Industrial and Post-Industrial). Each stage reflects varying levels of sophistication in the way a firm develops and markets its expertise. Because thought leadership marketing is a relatively new marketing discipline, it's no surprise to me that many firms are in the Stone Age and Medieval eras.

Google’s announcement yesterday that Eric Schmidt would relinquish his CEO title set off a flurry of derisive Twitter chatter about one term he used for his new role: “technology thought leadership.” Here’s what he said (but don’t expect elaboration on what he meant by the phrase).

From 23 years of helping companies become recognized as experts in their domains, I have found their ability to do so has varied greatly.  And it wasn’t because of their gray matter -- the expertise they could bring to bear on their clients’ problems.  Most of these firms had people who were highly knowledgeable about their domains.

Several consulting firms recently have asked for our opinion of their management journals.  All of them are well-written, graphically appealing, and chock full of articles. But beyond that, they all fall quite short today because the very model on which they are based is obsolete.  They are akin to the automobiles at the turn of the century that continued to use the horse-and-buggy and bicycle technologies that preceded them.

Companies with savvy marketers spend lots of time determining how to market a piece of compelling “thought leadership” content, especially one based on deep primary research. What blog posts can we create, and what bloggers should we contact? What about a webinar series? What opinion articles can we craft, and which publications should we target?  Is there a worthy Harvard Business Review or Sloan Management Review submission here? Perhaps even the basis for a book?

But I rarely see companies spending a similar amount of time determining how to use that content in their services. 

Nice to see we’re not the only ones who complain about indecipherable business communications.

Check out this Oct. 29 column by New York Times media critic David Carr about a CEO’s internal memo at magazine magnate Conde Nast (Vogue, The New Yorker, Vanity Fair, etc.).  Looks like employees are having a hard time understanding their boss’s lingo (“consumer-centric business model,” “holistic brand management approach” and “multi-platform, integrated sales and marketing organization”).  Sounds like a consulting firm ghostwrote the memo.

Thought leadership programs serve one master in most B2B firms: Marketing.  Marketing generates content (commissioning studies, writing white papers, and so on).  Marketing packages and distributes that content (producing academic-looking publications, seminars and webinars, educational PR campaigns, email newsletters, etc.).  Marketing then turns over the resulting client inquiries to account executives. Thought leadership is a Marketing activity.

But that robs thought leadership programs of their greater potential value – as sources of service innovation, not just marketing content. 

We continually look for signs that thought leadership marketing is gaining adherents outside of professional services.  The most recent nugget we’ve seen is one from Borrell Associates, a decade-old company you probably haven’t heard of unless you’re in the newspaper business. (They are a research firm that tracks local advertising spending, especially online.)
 

In my last post I said that developing fewer but more substantive points of view (sometimes even just one) is much more likely to make the phone ring than letting a hundred points of light shine in your firm. That’s for sure. 

But when you place your bets on fewer but deeper points of view, you will soon need someone who’s responsible for the end-to-end process of developing and selling a big idea.

Last month I explained the second of five factors behind companies that excel at thought leadership marketing: patience for the time it takes to develop a compelling point of view and attract an audience to it. (The first factor was a huge desire to distinguish one’s offering on the basis of possessing unique expertise.)

I find the third success factor rarer than the first two: focus.  By this I mean a company’s ability to invest its content development and marketing resources in fewer points of view rather than more.  Many fewer, in fact.

Good marketing generates many leads. It also gets a firm recognized by companies that don’t need help at the moment but will in the future, what marketers call “market awareness.”

That's the value of good marketing. Great marketing produces an abundance of leads – many more than a firm can handle at the time. It also spawns widespread awareness. But great marketing generates two other things that are even more important: the discretion to work only with clients who share your vision and values, and the dignity of knowing you can stick to your principles. 

In my last post, I laid out the first factor behind companies that excel at thought leadership marketing: a big appetite for differentiating their product/service offering on the basis of possessing truly unique expertise. These companies don’t want to compete on price -- whether they are an IT services firm that can’t match the costs of the offshoring contigent or a consulting firm whose brochures make it indistinguishable from hundreds of advisers in supply chain improvement.

This post is about the second of my five factors: organizational patience.

In my last post, I cited five factors that determine how proficient a company will be at thought leadership marketing – whether it becomes the recognized expert on some issue or not (and then enjoys the accolodes, leads and revenue).

Let’s look at the first factor: a big appetite for the type of differentation that a market-recognized thought leader possesses.

It’s great to see so many companies today that want to be recognized as “thought leaders” on the business problems their services and products address.  Software companies, transportation firms, financial institutions and many other sectors want in on the game. 

But what these companies often don’t recognize is what it takes to be seen by the market as a thought leader – a go-to organization on a particular issue. From doing this work for more than 20 years, I see five factors that are key to determining how well a firm plays the thought leadership game:

I was delighted to hear last week that Harvard Business School selected long-time HBS Professor Nitin Nohria as their next dean.  (Here's the news on that from Harvard Magazine.)

I caught of glimpse of Nitin’s intellect and working style 15 years ago in my days at the Cambridge, Mass., consulting firm CSC Index.  In his non-teaching time, Nitin helped Index’s utility industry practice develop new thinking on strategy in a fast-deregulating industry.  That effort led to a prescient Sloan Management Review article.  

I keep hearing people say that developing great content for thought leadership marketing campaigns requires instituting a publishing process, populated with reporters willing to become “corporate journalists.”  

I say that’s partly right and mostly wrong.

It’s amazing just how ingrained old techniques and old ways of thinking can be.  Especially mine (as my kids often remind me).  But the reason old habits are ingrained is that they work – at least for a long time. Then they begin working less well.  And at some point they don’t work. 

Here’s what I’m getting at: I believe we are on the cusp of seeing the longstanding way in which a subject expert or team of experts and their marketing colleagues produce and market a compelling piece of content become obsolete.  

For more than 20 years, I’ve seen consultants and other advice-sellers use an array of techniques to try to come up with a big new idea to take to market.  Some of these ideas were total failures.  A few were big successes.  Most were in between, generating some market interest.  And some of these spawned enough business leads to more than warrant the investment in time and money. I’ll list these methods, from least to most successful.

I look at the last two decades, and especially the last five years, as the era in which thought leadership marketing went mainstream – when a large number of professional services firms recognized the value of marketing their expertise in educational (rather than promotional) ways – articles, speeches, books, seminars and so on (rather than brochures, advertisements trade show booths, etc.).

Thought leadership marketing, which McKinsey, Boston Consulting Group and other consultancies pioneered in the 1960s, has now been adopted by many consulting, IT services, corporate training, accounting and, to a lesser degree, law firms.

Over this decade, I see professional firms continuing to get serious about building strong capabilities in thought leadership marketing – hiring talented ghostwriters, event marketers, social media whizzes and others who can package and market their professionals’ ideas. But this won’t be enough – not nearly enough – for them to generate big returns on their investments.

I look at the last two decades, and especially the last five years, as the era in which thought leadership marketing went mainstream – when a large number of professional services firms recognized the value of marketing their expertise in educational (rather than promotional) ways – articles, speeches, books, seminars and so on (rather than brochures, advertisements trade show booths, etc.).

Thought leadership marketing, which McKinsey, Boston Consulting Group and other consultancies pioneered in the 1960s, has now been adopted by many consulting, IT services, corporate training, accounting and, to a lesser degree, law firms. (Maybe the shakeout in the legal sector will spawn law firms to think more expansively about changing their age-old ways of attracting clients. Those that do will have a significant competitive advantage in marketing given the slow pace of change in their sector.)

Over this decade, I see professional firms continuing to get serious about building strong capabilities in thought leadership marketing – hiring talented ghostwriters, event marketers, social media whizzes and others who can package and market their professionals’ ideas. But this won’t be enough – not nearly enough – for them to generate big returns on their investments. The reason is these investments will do little to improve the content of their marketing campaigns – the ideas they bring to bear about how to solve a given business problem.

Professional firms themselves say it's the strength of the ideas they market -- not the strength of their marketing programs -- that is the key to generating leads and widespread awareness of their expertise among clients. See our research on this here.  

That’s an R&D problem, not a marketing problem. Professional firms that excel at thought leadership R&D – at developing truly innovative and effective approaches to solving their clients’ business problems – will gain a big advantage. (One key R&D tool is deep case study research.  Why?  Read this article.)

If professional firms market their ideas well and train their professionals to deliver them with consistent quality, they will be hard to stop.
 

Anyone looking for a "thought leadership marketing" or "thought leadership R&D" job needs to say the right things on his or her LinkedIn profile.  Why?  Because that's where the recruiters are looking, according to an article in the latest issue of Fortune magazine.

 We all know what happened in the 1980s when the Japanese began exporting cars to the U.S. with fewer defects than those made in Detroit. Toyota, Honda, Nissan (called Datsun then) and the rest began stealing market share from Ford, GM and Chrysler.  For 30 years now, the U.S.-based automakers have been forced to boost quality.  The same story has played out in industry after industry.

The multitude of market discussion on social media and thought leadership seems to center on how effectively blogs, Twitter, social networking sites and other online tools can propel ideas into the mainstream. 

Hard to argue against it, especially when a professional firm like McKinsey can go from zero to 48,000 Facebook fans in two years. 

But I see few pundits discussing a certain downside of social media for professional firms, one that goes beyond the reputational risk from in-house bloggers saying the wrong things.  It's this: Social media greatly raises the bar for everyone on the quality of their ideas.

 Several newspaper and magazine columnists have been chiding President Obama for lacking a “narrative.”  New York Times op-ed pundit Frank Rich vented this on Sunday in his column, which you can read here. (It's insightful reading no matter what your political persuasion.)