Gmail Tabs: Heartburn for Email Marketers

Like many Gmail users I have adopted the new tabbed interface that started rolling out in June. I like the organization model and find their categorization remarkably accurate, which in light of the ongoing government data privacy scandals only makes me more concerned about the machine processing of communications. However, it is useful and I only wish I could create my own tabs.

Screenshot (21)However, not all is rosy and I have noticed with particular interest that a number of prominent email marketers are sending out “helpful” messages about moving their messages from the Promotions tab to the Primary tab.

There are a couple of outcomes here that are interesting to consider. First and foremost is that a subset of marketers will be successful in moving to the Primary tab, based on the appeal they present to their customers. This will create a two-tier model where preferred marketers are valued disproportionately based on their customer appeal while the blunt force trauma marketers will be forced to change tactics as more email systems, presumably, adopt the Gmail tabbed interface (which for the record is not a new idea, AOL’s Altomail service had this well before Gmail).

The impact on email marketers is being felt and several studies are now coming out that quantify that impact. Email marketing analytics firm Litmus has published some stats showing a significant decline in Gmail open rates. However, their data is more complicated than a single stat would suggest and what they are questioning is how many Gmail web users actually open email in general in the web interface and in alternative apps, such as iPhone’s integrated email app.


ReturnPath has a different study that states that delivery rates are up but open rates are down. My own experience aligns with the ReturnPath data, which is that consolidating marketing email in one tab has increased its visibility to me, and for the merchants I care about I actually read their content more regularly. This aligns with the 2 tier model I suggested in the intro, open rates in my inbox are down overall but for the select vendors that target well and present offers I care about, my open rates are up.

I actually like email marketing but find the vast majority of merchants doing it really poorly. They clearly don’t connect with me on the basis of what I care about and will respond to, it is for the most part dumb marketing. Email marketers will have to deal with the new UX controls that email providers are building in by presenting more utility in their marketing campaigns, which means knowing more about me at an interest level, not just my demographics.

Startup Lessons: Board Management

This is the 5th installment in the Startup Lessons series I have been writing in the wake of my experience with Get Satisfaction. This one will certainly inspire a lot of head shaking around the table as anyone who has been involved with a startup can relate to this.

To recap, here is the series thus far:

1) Hiring
2) Dynamic Org Structures
3) Product First
4) Marketing

5) Board management: My point here is not about criticism of investors because at the end of the day what investors provide above all else is access to capital, and point in fact their motivation is ultimately pure, which is they are in it to make money. Clarity of purpose is really a blessing but as anyone who has been involved with venture capitalists from the perspective of a startup can attest, there is a lot of complexity.

Investors do not do that much to help a company operationally, despite what they may want to believe about their contribution. They are a sounding board and provide critical objective voice on strategic subjects, but an investor is far too removed from the day-to-day decision making to be useful in an operational capacity, and if they are involved in the day-to-day then the are no longer simply investors.

Where this all comes to a head is when a company is facing headwinds. People in general tend to want to simplify things down to the just one thing moment and any problem set in the modern tech startup that can be distilled to just one thing at it’s root is an exception if there ever was one.

An example of this is having a board member say “well you should just charge more” without first considering the competitive dynamics of a market, or the product and customer perspective on value. If the challenge of running and growing a business like this is easy then anyone could do it, so for all the investors reading this right now, it would be helpful to acknowledge that people running these businesses have more knowledge than you do about the business itself. As much as you want to pattern match, that isn’t always helpful because no one person has experience with all the patterns that can be identified and patterns of the past are not indicators of future performance.

Companies and markets are highly volatile multi-variant problem sets that defy simple explanations and recommendations. What investors across the board should be doing in environments like this is helping clear the fog and applying intellectual horsepower where it is really needed, the planning side of the business. Building good forecasting models against the backdrop of fast changing performance factors is no small task, and planning is 1/2 of the planning/controlling responsibility a team is responsible for, but typical boards end up spending a lot of time on the controlling part of the equation.

Furthermore, when it comes to planning the typical startup has the additional dynamic of being not well equipped to push back against investors who have an expectation of growth rates in the early stages that well exceed 100%. This is where the multi-variant challenges rears it’s head, which is that no market is static so while you are building a product, growing a customer base, facing new competitive threats whether they be other startups or incumbents who have identified you as a threat, and then hiring people to support growth in the business. well a lot of things can derail the best laid plans.

Managing for growth vs. managing for margin enters the discussion because investors want to manage cash efficiently while also proving the growth capability of the company in order to get to the next stage of financing. There is little room for error here and the capital markets are far less forgiving of pivots than they were 2 or 3 years ago.

I also want to talk about shareholder interests and the Board members positions are, typically, preferred shareholders. What is really lacking in tech startups today is a strong voice for common shareholders, the employees, in private companies. The executive members of the board are supposed to fulfill this but all too often their voice is not equal to that of the other board members when it comes to shareholder classes. Preferred shareholders are inherently conflicted in this regard because they enjoy advantages such as liquidation preferences and anti-dilution protections that give them a built-in advantage over the common class of stock.

The modern board needs to cast off the standard operating procedures of the past, in the process becoming more inclusive of shareholder classes as opposed to representing the preferred shareholders first and everyone else second. Board meetings require great structure and strong leadership, and board members need to accept that there will be pushback and dissent based on facts and information that they may not see plainly relative to executives of the company.

As a startup you have a choice, you can be subservient to the board, bending to their pre-determined points of view, or you can be a strong force that counterbalances the parochial interests and instead favoring the greater good. Lastly, boards should be focused exclusively on the substance of the company and less about the personalities of the board members and the executive team.


Elon Musk is an enviable entrepreneur. He resides in the rarified air of a credible tech celebrity and can command the rapt attention of the tech media with little more than a 57 page term paper for something that he, in his next breath, declares he won’t build.

Never mind the construction costs, rights-of-way, economic model, reliability. On the other hand there is no new science here either, he is proposing pneumatic pressure instead of vacuum pressure and that is a well understood force.

We need more people like Musk, who has built three companies in completely separate markets and in each case are capital intensive, highly regulated, and dominated by bureaucratic morass. If anyone could build high speed transportation that wouldn’t suck in California (e.g. high speed rail) I would put my money on Musk. too bad he won’t actually do it.


Startup Lessons: Marketing

This is the 4th installment in the Startup Lessons series I have been writing in the wake of my experience with Get Satisfaction. We are getting into the topics that are much more specific to Get Satisfaction, therefore I have an obligation to redact certain details that are confidential however in the spirit of shared learnings I will cover as much as I feel is appropriate.

To recap, here is the series thus far:

1) Hiring
2) Dynamic Org Structures
3) Product First

4) Marketing. and all that implies: What can you say really, if there are 2 things that a startup in tech should be good at, it’s product and marketing, everything else succeeds or fails on the basis of being good at those core activities.

Get Satisfaction was blessed – and I mean truly blessed – with the kind of brand that most companies in the space would kill for. It is at it’s core an aspirational brand message about all of the promises that the social technology revolution has presented to companies as they remake how they interact with people. I really loved telling the story of GS for this reason alone, it is about what is possible by empowering people, customers and employees, rather than saving a few dollars here or picking up some extra revenue there.

The problem with aspirational brand messages is that if you don’t back it up with hard hitting marketing that converts goodwill into revenue, you are wasting it or worse, educating the market about how to evaluate competitive products.

We did very well in 2010 and 2011 with a highly differentiated creative marketing strategy but then we had our VP Marketing leave just after the B round closed (awkward.) and the role went unfilled for the better part of a year. Actually, it was worse than that, we had a consultant that one of our investors recommended and that was a disaster that resulted in a botched website project, what I thought was a stupid book project, and a lurching repositioning of the company to traditional enterprise software. Disaster.

The last issue is particularly sensitive for me because at the time I was responsible for the freemium business and nobody was trying to understand what this part of the business needed in a website. The result was, predictably, a website that catered to the old world traditional call-to-action of “call us and talk about enterprise”. Not surprisingly, the new customer acquisition ramp for the monthly subscription business flattened out dramatically almost immediately when this site launched.

We did eventually replace the marketing consultant with a VP Marketing but by then the damage was done. Brand voice was lost, our demand gen was wonky because of the confusion we were creating around our market focus, and “shit wasn’t getting done”. Remember what I wrote about in my first post in this series about hiring and how bad hires are a cancer?

Even after putting in place a full time marketing leader things didn’t really get that much better. I think this goes to the dynamic that executives in this industry, and others for that matter, exhibit which is in times of challenge they go back to what they know. I do not believe that Get Satisfaction should have been directed at large enterprise sales opportunities as a primary revenue source, but that’s what happened and our marketing reflected that in spades.

My stated preference was to point the marketing at the upper SMB and mid-market buyer, also called the departmental buyer, and qualify 100% of the business off what was coming in from the web funnel. The is what companies like Yammer, Hootsuite, and Zendesk have done, they drive the traffic to the site and skim the enterprise opportunity funnel off the top. The objective in this approach is getting people into a rich product experience and then converting them or upselling them into an enterprise buying lane, rather stating a preference or making them choose up front.

Succeeding at zero to low touch web direct sales models is not a challenge to take lightly, it requires an intense focus on web traffic generation and instrumentation of assets for funnel analytics. It also requires that people think outside of their comfort zone of campaigns, PPC, webinars, and landing pages. in fact I feel more strongly than ever that in order to be successful with this customer acquisition model that tech companies need to act more like media companies with a distinct editorial agenda and content strategy. For this kind of model to work you need a lot of traffic. paid, sponsored, and earned traffic, all of the above.

Even if we did all that I am not sure we would have been successful because at the core we were underinvesting in marketing, both people and spend. However, it is hard to fault us for not investing more in marketing because we clearly had not solidified the Magic Number math that is essential for justifying increases in marketing spend.

There was a bigger issue with the marketing performance that all companies need to be aware of. When you marketing team has as a primary objective enterprise demand generation, well what they measure is enterprise lead generation. Meanwhile, GetSat also had a line of business that was dependent on getting people into the website and into a product experience that converts into a monthly subscription relationship, therefore we had a real sync problem that would not have been resolved with more money thrown at it.

When you measure your marketing spend solely on the basis of lead generation, the slippery slope is changing the definition of lead to juke the stats and show improvement in the specific activity you are measuring. This is something I will forever be aware of, measure the result instead of the activity.

I will close by highlighting something really special I saw happen at Get Satisfaction. Based on the early product work and what we discovered as the first iterations of the business came together, it was clear that social technologies were driving a consolidation of the customer lifecycle that all companies are subject to, with customer support and marketing coming together for the purpose of serving the customers you already have while using that momentum to acquire new ones. Whether or not we did this well in the business is not the point, the fact remains that we identified an important shift in the market well ahead of competing companies. While we did not fully capitalize on this, in no way does that take away from the innovative work that was done to develop a differentiated marketing story to compliment the product.

Panasonic Lumix DMC-LX7

As I was packing for our recent trip to Florida I looked at my camera bag with my Canon 5D MKII, lenses, battery, filters, and assorted gadgets and thought “man I really don’t want to haul that stuff when I’m really not going to have an opportunity to use it for more than casual pictures”. So I talked with a couple of friends, @mkrigsman and @mfauscette who are my goto guys for the latest in camera gear.

I have a pretty good camera in my Samsung S4 so I didn’t want a point-and-shoot that was little more than the Samsung S4 without the smartphone pieces. but at the same time I didn’t want to spring for a super high end compact camera like the Fuji X100S or the Sony RX1R. I did want a compact camera that came with a high quality lens, not a prime, and was fast enough to perform well in low light while offering the convenience of point-and-shoot. The Panasonic Lumix DMC-LX7 and Sony RX100 were on the short list. I chose the Lumix primarily because it was about $200 less expensive than the Sony while offering pretty much the same specs.

The family vacation in south Florida went off well and I have continued to use the camera in a few other instances over the last few weeks. Overall I really like it but given the choice I would spring the extra $ and get the Sony if I were to do it again.

P1000086The Leica lens on the Lumix is impressive and pixel for pixel probably equal to the Zeiss glass in the Sony. I really like the aperture control ring on the lens itself, which is very handy but am wondering how useful the aspect ratio selector is. The low light performance of this camera is exactly why I bought it, and the noise that comes with cranking up the ISO is not actually that severe.

The controls are easy, love the knurled dial on top and like the video button that does not require me to switch modes before using. The on/off switch is easy to deal with on the fly and zooming is fast. Once you get used to the multi-function buttons on the back of the camera you can work these easily enough, but getting used to them is the key. P1000136

The LCD display is sharp and bright but the ability to use it outdoors depends a lot on where and how you are using it. This is something that I found really frustrating and just wanted an integrated viewfinder I could look through. there is an attachment from Panasonic for this but it is an additional $160 and increases the bulk of the camera significantly.

The most surprising thing to me about this camera is the thing I found really annoying. the lens cap! The Sony has an integrated lens cover, the Lumix has a traditional cap that you need to remove before use and if you turn the camera on without removing the cap you have to press a button, any button, for the camera to activate. Little things always prove to be the undoing of otherwise great products. P1000115

In retrospect I would have sprung for the Sony but not because it is that much of a better camera. Purely on the basis of performance it is probably about equal with the Lumix but a couple of design aspects overcome weak spots with the Lumix.

The integrated lens cover is a big plus in my opinion but the overall form factor of the Sony is quite a bit more compact than the Lumix and that makes a difference for a walking around camera. The lens quality is comparable and while I like the manual adjustment rings on the Lumix I have to say that the pancake style lens on the Sony is pretty appealing.

P1000142Both companies offer included software but I did not have the opportunity to use the Panasonic supplied software because they ship it, along with the full manual, on a DVD drive and I do not have a single computer in my house with a DVD unit. I contacted Panasonic support and they do not offer the software as a download. This is a significant failing on their part and I hope they start offering downloads.

You won’t go wrong with either camera and in the future I will be leaving my 5D at home more than I ever thought I would have as a result of what these high performance compact cameras bring to the table.

PS- I have some great action shots from this camera but in each one my children are featured. I generally don’t post pictures of my family in my blog posts so you will have to take my word for it that when it comes to action shots the Lumix handles the task with ease.

Startups Lessons: Product First

I have covered a couple of topics in this series, the first being hiring the best people and the second organizing for success based on the attributes of the people you are hiring.

Today I want to go into territory less obvious because let’s face it, hiring the best people and creating conditions where they can succeed is the kind of startup advice that is squarely in the “stating the obvious” category. This next one is also obvious but has so much nuance that it deserves attention.

3) It all starts with the product: Companies can overcome a great many challenges with band-aids, duct tape, and bailing wire. but one aspect of a startup and/or growth stage company that cannot be glossed over is the product. It all starts with the product. Marketing and sales will be amplified with the right product or victimized by the product that falls short, and not investment outside of product will overcome that reality.

Putting forward the right product for the market is absolutely key, but don’t confuse that with putting forward the BEST product. Ultimately you need to achieve best in class but if you try to achieve that in the first iteration you will be hopelessly late. and more on point is that the best product is a result of what you learn from your customers, not what you think you should be doing.

If we did anything egregiously wrong at Get Satisfaction in the 2010-1012 time period it was to under-invest in the product with the assumption that the existing product was good enough. The early architecture conditions created what engineers called “technical debt” and that effectively became weaponized to stall significant investment in fixing the old in order to build the future. Compounding the problem is that we became victim of agile engineering in a poorly structured development organization where there were no clear teams focused on building to the user archetypes and investing in the platform.. engineers paired would jump from frontend to backend erratically at each sprint iteration.

We failed to accommodate the changing demands that are a result of market, competitive and customer dynamics, all of which conspire to put you at a competitive disadvantage when you don’t have a market footprint that legitimately reclassifies you as a platform instead of just a product. Feature development is a result of the demands of the biggest customers with the loudest voices, the platform evolves at the rate which new customer features are required, not anticipated mind you, and lastly the API development is focused on what internal developers require rather than what the partner ecosystem is asking for.

In the absence of an org structure that creates a constructive tension between the product management and product engineering sides of the house engineers will work on things that are interesting to engineers but fail to advance the business. This is where we really erred in our approach, engineering and product management all report up to the CTO, and the company fundamentally underinvested in product management as a functional area.

In all fairness, the fact that the underlying product architecture was constraining product development had to be dealt with because in order to build better product their needed to be a foundational renovation of the substructure, and after years of kicking that can it was finally addressed in 2012. With that in mind I can’t help but remain conflicted by my view on this, either we replaced the architecture and built little in the way of new product or we focused on cobbling together new functional features that satisfied immediate demands while potentially sacrificing long term gains. and by framing it as a binary choice I am perpetuating the problem in many ways. We should have been able to do both.

My experience at Get Satisfaction has left me with a strong appreciation for the role of product manager, which as many in Silicon Valley will point out is the most powerful role in any company. While true, this oversimplifies the challenge of the role, which is not to wield an autocratic sense of control over product direction but rather be an effective consolidator of many sources of information, from all corners of the company. Good product managers hold dear a narrative about the market that is rationalized with the realities of running the business and they are always a half step ahead of the rest of the company in bringing product capability to bear that is great than the sum of a bunch of features. Lastly, a foundational skill of great product managers is GSD.

Identity and The Rise of Borderless States

I had this conversation with @andredurand a few weeks ago. What services does a government provide?

- Identity
- Central bank-backed currency
- Law-and-order (optimally in equal proportions)
- Defense

Of course there are more but many of the things we associate with government, e.g. social services, are in fact choices that a citizenry has made rather than a core obligation of government as a necessary means to govern. So the question now is whether or not we are entering a phase of a pseudo-borderless form of governance where people self-associate according to fluid social preferences and needs. The reason I am inclined to think this is not only possible but probable is that two of the core services that government provides are being undermined, the first by their own actions and the second by technology.

Currency is increasingly disconnected from economic conditions and central banks are demonstrating on a daily basis that their ability to affect currency is tenuous at best. The rise of Bitcoin is presenting a viable alternative currency that has many of the attributes of central bank backed currencies, namely a liquid market to trade. Games and social networks have similarly organized and promoted virtual currencies that can be arbitraged against non-virtual currencies.

Identity, on the other hand, is increasingly being driven by technology and at CIS the various talks about 3rd party verification services really stimulated my thinking on this. What if government-backed identification is no longer the gold standard for proof of identity? What this would mean is that the ability for governments to authenticate identity for transactions and contracts would be undermined and we would be one step closer to borderless states.

I have no way of assessing probability to any of this but the one certainty is that the pace of technological evolution is accelerating and with it comes dramatic social change that has implications well beyond the product and service capabilities by themselves so if I were to think about what the world looks like in 30 or 50 years, I am not sure I would discount any of this.

Speaking of 50 years, this article in American Banker really drives home the point about how identity is informing future businesses in ways that are entirely disruptive to traditional business models.

Fifty years from now? In her excellent and thought-provoking Long Finance report on the future of financial services, Gill Ringland rather memorably said that the citizen of the future would need the critical resources of an identity, a credit score and a parking place in order to function. If that’s true – and I certainly believe it to be the direction of travel – the bank’s critical role will be built on the customer identities, not their deposits. The vaults will not be stuffed with material valuables, but with the most valuable asset of all: personal data.

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The Chromebook Dulls…

Back in June I wrote a post about my plunge into the world of Chromebooks. I thought it would be a good idea to provide an update on that experience and highlight the reasons why I am putting it on the shelve, or more precisely handing it over to my son…

First the good, which is that it really is a viable alternative to Mac and Windows. Almost everything we use these days is browser based so running a sub-compact laptop that relies exclusively on a browser for applications is workable. It is inexpensive, the battery life is fantastic and it does the job for most tasks.

Here’s what I didn’t like:

  1. The Samsung is slooooooow and the display is actually rather weak, rising to the “good enough” level on the best of days. Admittedly these issues can be resolved with a more capable alternative like the Google Pixel but why would I spend $1,300 on a laptop that has other significant shortcomings? 
  2. Google Print and remote desktop both rely on the host being available (no surprise, right?) but in the case of print this is particularly debilitating. We have no fixed computers in our house, everything is either laptop or tablet and when it comes to printing, which is still a required capability, the Chromebook became a problem because it was looking for one specific laptop that I had sourced with the Google Print capability. It was not always available and this resulted in frustrating moments when I really needed to print something and could not. Google needs to sort out this print feature set to enable direct-to-printer interfacing, even if with a generic driver.
  3. Can’t run installed Java therefore Gotomeeting, Webex, etc. are not possible… this was a major problem for me. There is a way to do this with remote desktop but then we come back to the issue above, if the remote desktop is not available you are out of luck.
  4. Could not connect USB devices I wanted to connect, like my camera. This surprised me, I just assumed that any device connected with USB would be treated as external storage… not the case. #fail.
  5. The last issue is a strange one and it is only when you use the laptop for a while that you notice how annoying it is. There are odd caching behaviors that result in pages being reloaded way too often… for example, if you shift focus away from your Gmail tab for more than a few minutes and then return to the tab it will reload Gmail. This is massively frustrating if you are like me and are in and out of Gmail literally hundreds of times per day. Add up all those 10-15 second intervals over the course of a day and it adds up to a good chunk of wasted time.

On balance I am still happy to have the Chromebook, and for my son it will work really well, but the fact remains that with the significant shortcomings this device is not adequate for business use.

Turning off Comments

I have turned off comments for the time being… 2 reasons:

1) Spam: I am getting inundated with spam comments masquerading as legitimate comments. The better ones are hard to detect at first glance, only when I see the link in either the commenter ID or in the comment itself is it then evident that someone is looking for a free ride on my SEO juice.

2) Alternative Channels: I actually don’t get that many comments, most people that I interact with are doing so via Twitter, Facebook, and Linkedin. For this reason above all else I am not concerned about shutting down comments, the discussion will not be impacted.

I should also highlight that the way I am doing this is by pushing every comment into moderation by default, which means the comment functionality will still display but comments will not immediately post. The way I figure it, if spammers are going to waste my time I might as well turn the tables and waste their time by allowing them to believe they are posting comments but then not having the fruits of their labor display… eventually they will move on.


Startup Lessons: Dynamic Org Structures

Last week I posted the first in a series of posts about my startup experience with Get Satisfaction. The first post focused on hiring and was appropriately the first in the series because hiring decisions will make or break your company.

However, it doesn’t stop there and once you have a team of smart capable professionals you have to create an organization structure that breaths and grows with them as the team accomplishes key objectives and develops an operational cadence around key business metrics.

2) Dynamic organizational structure: Not everyone will scale with the company and an essential strategy for accommodating and driving growth is continual reorganization. At Get Satisfaction we should have done more of this, moving people around as we grew and then pairing up different teams to accomplish specific objectives.

An example is that Marketing was inexorably linked to the enterprise sales demand gen requirements and while that would never go away the fact remains that other parts of the business suffered as that focus became all encompassing. In retrospect it would have been advantageous to pair marketing with a different team each quarter and set an an objective improvement in a key metric not related to demand generation, for example, working with customer support with the singular goal of improving customer communication efficacy.

As a company grows the requirements placed on individual leaders change and not everyone will make the shift so deliberate transition into different roles or out of the company is something that has to be planned. This isn’t a reflection of people failing but rather succeeding and the new demands evolving as a result.

Dynamic organizations reflect this by moving leaders into different roles not as a reaction to what is happening on the ground but as a forward motion intended to create progress in a new and emerging area. Successful startups move early executives into new roles frequently, not in an effort to sideline them but rather take advantage of their unique skills and organization knowledge to advance an area that would otherwise stagnate.

I am taken aback by how much time should be devoted to team and people issues in a startup, for a company like Get Satisfaction I would say at least half of the CEO time needs to be spent on managing this and recruiting the best people for the challenges that are currently being experienced and what lays ahead. Once you have a team of good people you need to continually optimize that for business results but also change it up keep the people you have operating at peak intellectual engagement and interest.

Part of the challenge with “the best people” is that they don’t neatly fit into the existing organization structure, and the other part is that everyone has a sweet spot of company phase that they thrive in. I am a good example of this, very large companies are soul crushing for me, the overburdened process and gravity to inertia absolutely deflates me, yet the pure play startup is equally outside my comfort zone because I don’t bring tools that are well honed for business creation. I am a best fit for a company with presence, a reasonably complete product, and customer assets, in other words growth stage or on the precipice of a growth stage buildout.

Creating organization structures for people based on their capabilities rather than your org chart and recognizing where people thrive and where they outlive their utility is essential.

Equally critical for dynamic organizations is to decentralize decision making to the nodes of the organization. This is no small challenge for companies that achieve mass after having slogged through a startup period that is an all-hands exercise. Top down decision making results in critical time lost and decisions that are inexorably compromised in order to satisfy the personalities of the team rather than the outcomes that is desired. You hire smart professionals who have, ideally, good judgment and intellectual capacity, why not lead them by getting out of the way and letting them do the jobs they were hired to do rather than managing indecision as a result of people not measured by the specific outcomes affecting the strategy and tactics required to get there?