Management Newsfeed Update

Industrial technology business Novariant Inc. raised $40 million in its fourth round of venture funding.

First Horizon National Corp. announced Friday the appointment of Frank Gusmus as president of FTN Financial, the company’s capital markets business. (FHN)

Stanford has put all the course material for CS 193P - iPhone Application Programming up on the web.  If you are developing an iPhone app, or considering it, the course looks like it has a huge amount of useful data. 

While it’s not over yet as the Supreme Court might weight in, the Federal Court Kills Patents on Business Methods.  I haven’t read things carefully yet (I’ll leave that for the bathroom this weekend) but from the quick analysis I’ve read (In re Bilski: Patentable Process Must Either (1) be Tied to a particular machine or (2) Transform a Particular Article) it looks like it is a strong, unambiguous decision in the good fight to eliminate ridiculous patents.

The Federal Court declined to weigh in on my hated software patents, but this is a huge step in the right direction.  Bye bye business method patents - at least those that aren’t either tied to a particular machine or transform a particular article - how we’ll miss thee.

The Donor’s Choose Blogger’s Challenge ends today. The AVC community is in first place in the tech category with about $16,000 donated, ahead of TechCrunch by about $3300 as of 7am eastern. So we are rounding the last turn with…

Well it looks like we got a win yesterday when the Court of Appeals for the Federal Circuit ruled that software and business method patents must meet a two pronged test that should serve to render many of these patents…

I find it strange that Google felt the need to send the following note out to their publishers (are we going to stop writing/publishing because we fear the bottom has fallen out of the CPC market?!?).

Dear Publisher,

We understand that the recent economic turmoil has created a lot of uncertainty in the lives of AdSense publishers. During these difficult times, we’re continuing to invest in innovations that improve publisher monetization and advertiser value in the content network.

We’re focusing on further developing our product offerings and boosting ad performance for publishers. We recently announced advancements in AdSense for search and experiments to make ads more effective. We’re bringing DoubleClick technologies to AdSense publishers, and we’ll continue to launch new products and features. We’re also continuing to improve our offerings for AdWords advertisers, making it easier for them to target the Google content network. Features for advertisers, such as the new display ad builder, are designed to improve ad performance on AdSense publisher sites.

We’ll keep driving technological progress, but our best asset will always be our publisher partners. The strength of AdSense lies in the value of the content you bring to users and the quality of the sites you bring to advertisers. Our success is tied to yours. We look forward to partnering with you for the long term, and remain dedicated to helping you succeed.

I delivered the Grunig Lecture at the University of Maryland today to a group of students and their professors. My topic was the evolution of public relations into public engagement. I asserted that PR can become the discipline that melds strategy and communications, constituting an essential bridge between corporations and their stakeholders. I contended that PR must also be part of business strategy and policy formulation, in addition to being responsible for communicating the decisions.

There is the confluence of several trends in the marketplace that make this transition possible and advisable. The recent government emergency intervention in global financial institutions has ended the free market era of Reagan and Thatcher. The dispersion of authority continues with CEOs under fire (akin to the period 2001-02 after Enron, Parmalat) and government officials seen as ineffective regulators. The transformation of media is accelerating, with mainstream media downsizing (layoffs at Time Inc. yesterday morning), greater reliance on digital platforms and merging of news with entertainment (“newstainment”CNN’s new comedic news show). Expectations on companies are rising with stakeholders looking for Mutual Social Responsibility– merging cause related marketing with corporate social responsibility.

I suggested that Public Engagement has four important attributes:

First, it is democratic and decentralized. A good example of this is the Obama campaign’s mobilization of five million volunteers, who are able to make decisions on how best to contact voters, attract funds and communicate on social media. Another is the MyStarbucksIdea.Force.com site that solicits new product ideas from the crowd, reinforcing the company’s relationship with its customers while the company listens and learns (disclosure: Starbucks is a client, but we are not involved directly in this program).

Second, it aims to inform the conversation. This is a major change for PR, which has relied on research-tested messages delivered one-way to media, which then writes the stories. If Andrew Heyward, former president of CBS News, is correct in positing that “Every company today is a media company,” then smart businesses will take the opportunity to become public resources on areas of expertise, by providing credible well-researched data on its own web site, and correct on-going discussions, whether on discussion forums or in the press, if there are factual errors. An example of this is our work for Masdar, the first carbon-neutral city in the world that has become an important focus for data on new forms of energy.

Third, it calls for engagement with influencers of all stripes. To be influential today does not require academic or professional credentials alone. It means that the person has personal experience with the product, passion for the category, and a desire to contribute to general knowledge. It is our task in PR to build trusted relationships with the broad set of influencers. A great example is the Johnson & Johnson (a client) Family Health Institute in China, which helps educates mothers about family health, and funding schooling for nurses.

Fourth, it suggests that reputation is built on policy and communication. Our client Wal-Mart’s strong commitment last week to the highest standards on environment and workplace safety in China is indicative of this trend. It is often useful to partner corporations with the NGO community for input in the decision making process and help garner support in the broader community.

The rationale for public engagement is best captured by Thomas Friedman, who wrote a week ago in the New York Times, “In a connected world, countries, governments and companies have character…how they do what they do, how they keep promises, how they make decisions, how they engender trust…” The PR business must rise to the challenge, by creating a new form of expression that will work in today’s cynical and uncertain environment.

Here is a copy of my presentation.

I would appreciate your views as always.

A recurring theme in venture circles these last few weeks has been "Back To Basics" with VC pundits boldly prognosticating about the current state of the markets, talking about the infamous Sequoia deck and trying not to make people wince as they lay their claim to how they saw all this coming (I’m not immune to this myself and offered what I hoped was some practical advice in a recent post).

All of this gets me thinking, however - why is it that companies got away from "the Basics" in the first place. Every time people think the rules have been rewritten and that somehow "this time will be different" they are wrong.  So if we take anything away from this current crisis, for me it should be a reminder that most successful businesses are built carefully, over several (if not many) years and require a steady and disciplined approach.  At the core if this process is being realistic about what you can accomplish in any given period of time and not letting costs get ahead of where you are in both your business cycle and access to capital (see my take on that from last year - all of which still holds true).

Building businesses is in large part about the basics - let’s not get too far away from them next time.