{"id":2957,"date":"2011-01-17T05:47:17","date_gmt":"2011-01-17T13:47:17","guid":{"rendered":"http:\/\/michaelbrandvold.com\/blog\/?p=2957"},"modified":"2011-01-17T05:47:17","modified_gmt":"2011-01-17T13:47:17","slug":"how-facebook-beat-myspace-adam-hartung-at-forbes","status":"publish","type":"post","link":"https:\/\/michaelbrandvold.com\/blog\/2011\/01\/how-facebook-beat-myspace-adam-hartung-at-forbes\/","title":{"rendered":"How Facebook Beat MySpace – Adam Hartung at Forbes"},"content":{"rendered":"

\"MySpacephoto \u00a9 2009 kevin<\/a> | more info <\/a><\/span>(via: Wylio<\/a>)<\/strong><\/span><\/span><\/span><\/span>The following Forbes article is a interesting take on what happened to MySpace and contributed to it’s downfall and why Facebook is succeeding where MySpace failed. I found this even more interesting because the MySpace world outlined below is very similar to the environment of my last company.<\/p>\n

“MySpace demonstrates a big fallacy of modern management.\u00a0 The belief that smart MBAs, with industry knowledge, will perform better.\u00a0 That \u201cgood management\u201d means you predict, you forecast, you plan, and then you go execute the plan.\u00a0 Instead of reacting to market shifts, fast, allowing mistakes to happen while learning what works, professional managers should be able to predict and perform without making mistakes.\u00a0 That once the bright folks who create the strategy set a direction, its all about executing the plan.\u00a0 That execution will lead to success.\u00a0 If you stumble, you need to focus harder on execution. “<\/p>\n

That is a pretty accurate description of how my last company operated, and the results were not that stellar. Executives predicting the future, over meeting, over planning, no review of mistakes, executing the plan and no focus on the marketplace.<\/p>\n

Read the following and think about how you are executing. Don’t get caught up in over planning and make sure you are listening to the marketplace and your customers.<\/p>\n

\n

How Facebook Beat MySpace<\/h2>\n

By ADAM HARTUNG<\/p>\n

Before there was Facebook, the social media juggernaut which is changing how we communicate \u2013 and might change the face of media \u2013 there was MySpace.\u00a0 MySpace was targeted at the same audience, had robust capability, and was to market long before Facebook.\u00a0 It generated enormous interest, received a lot of early press, created huge valuation when investors jumped in, and was undoubtedly not only an early internet success \u2013 but a seminal web site for the movement we now call social media.\u00a0 On top of that, MySpace was purchased by News Corporation, a powerhouse media company, and was given professional managers to help guide its future as well as all the resources it ever wanted to support its growth.\u00a0 By almost all ways we look at modern start-ups, MySpace was the early winner and should have gone on to great glory.<\/p>\n

But things didn\u2019t turn out that way.\u00a0 Facebook was hatched by some college undergrads, and started to grow.\u00a0 Meanwhile MySpace stagnated as Facebook exploded to 600 million active users.\u00a0 During early 2010, according to The Telegraph<\/em> in \u201cFacebook Dominance Forces Rival Networks to Go Niche<\/a>,\u201d MySpace gave up on its social media leadership dreams and narrowed its focus to the niche of being a \u201csocial entertainment destination.\u201d As the number of users fell, MySpace was forced to cut costs, laying off half its staff this week according to MediaPost.com<\/em> in \u201cMySpace Confirms Massive Layoffs<\/a>.\u201d After losing a reported $350million last year, it appears that MySpace may disappear \u2013 \u201cMySpace Versus Facebook \u2013 There Can Be Only One<\/a>\u201d reported Gigaom.com<\/em>. The early winner now appears a loser, most likely to be unplugged, and a very expensive investment with no payoff for NewsCorp investors.<\/p>\n

What went wrong? A lot of foks will be relaying the tactics of things done and not done at MySpace.\u00a0 As well as tactics done and not done at Facebook.\u00a0 But underlying all those tactics was a very simple management mistake News Corp. made.\u00a0 News Corp tried to guide MySpace, to add planning, and to use \u201cprofessional management\u201d to determine the business\u2019s future.\u00a0 That was fatally flawed when competing with Facebook which was managed in White Space, lettting the marketplace decide where the business should go.<\/p>\n

If the movie about Facebook\u2019s founding has any veracity, we can accept that none of the founders ever imagined the number of people and applications that Facebook would quickly attract. From parties to social games to product reviews and user networks \u2013 the uses that have brought 600 million users onto Facebook are far, far beyond anything the founders envisioned.\u00a0 According to the movie, the first effort to sell ads to anyone were completely unsuccessful, as uses behond college kids sharing items on each other were not on the table.\u00a0 It appeared like a business bust at the beginning.<\/p>\n

But, the brilliance of Mark Zuckerberg was his willingness to allow Facebook to go wherever the market wanted it.\u00a0 Farmville and other social games \u2013 why not?\u00a0 Different ways to find potential friends \u2013 go for it.\u00a0 The founders kept pushing the technology to do anything users wanted.\u00a0 If you have an idea for networking on something, Facebook pushed its tech folks to make it happen.\u00a0 And they kept listening.\u00a0 And looking within the comments for what would be the next application \u2013 the next promotion \u2013 the next revision that would lead to more uses, more users and more growth.<\/p>\n

And that\u2019s the nature of White Space management.\u00a0 No rules.\u00a0 Not really any plans.\u00a0 No forecasting markets.\u00a0 Or foretelling uses.\u00a0 No trying to be smarter than the users to determine what they shouldn\u2019t do.\u00a0 Not prejudging ideas so as to limit capability and focus the business toward a projected conclusion.\u00a0 To the contrary, it was about adding, adding, adding and doing whatever would allow the marketplace to flourish.\u00a0 Permission to do whatever it takes to keep growing.\u00a0 And resource it as best you can \u2013 without prejudice as to what might work well, or even best.\u00a0 Keep after all of it.\u00a0 What doesn\u2019t work stop resourcing, what does work do more.<\/p>\n

Contrarily, at NewsCorp the leaders of MySpace had a plan.\u00a0 NewsCorp isn\u2019t run by college kids lacking business sense.\u00a0 Leaders create Powerpoint decks describing where the business will head, where they will invest, how they will earn a positive ROI with projections of what will work \u2013 and why \u2013 and then plans to make it happen.\u00a0 They developed the plan, and then worked the plan.\u00a0 Plan and execute.\u00a0 The professional managers at News Corp looked into the future, decided what to do, and did it.\u00a0 They didn\u2019t leave direction up to market feedback and crafty techies \u2013 they ran MySpace like a professional business.<\/p>\n

And how\u2019d that work out for them?<\/p>\n

Unfortunately, MySpace demonstrates a big fallacy of modern management.\u00a0 The belief that smart MBAs, with industry knowledge, will perform better.\u00a0 That \u201cgood management\u201d means you predict, you forecast, you plan, and then you go execute the plan.\u00a0 Instead of reacting to market shifts, fast, allowing mistakes to happen while learning what works, professional managers should be able to predict and perform without making mistakes.\u00a0 That once the bright folks who create the strategy set a direction, its all about executing the plan.\u00a0 That execution will lead to success.\u00a0 If you stumble, you need to focus harder on execution.\u00a0 Probably get a new President who understands execution \u2013 in a more brutal way.<\/p>\n

When managing innovation, including operating in high growth markets, nothing works better than White Space.\u00a0 Giving dedicated people permission to do whatever it takes, and resources, then holding their feet to the fire to demonstrate performance.\u00a0 Letting dedicated people learn from their successes, and failures, and move fast to keep the business in the fast moving water.\u00a0 There is no manager, leader or management team that can predict, plan and execute as well as a team that has its ears close to the market, and the flexibility to react quickly, willing to make mistakes (and learn from them even faster) without bias for a predetermined plan.<\/p>\n

The penchant for planning has hurt a lot of businesses.\u00a0 Rarely does a failed business lack a plan.\u00a0 Big failures \u2013 like Circuit City, AIG, Lehman Brothers, GM \u2013 are full of extremely bright, well educated (Harvard, Stanford, University of Chicago, Wharton) MBAs who are prepared to study, analyze, predict, plan and execute.\u00a0 But it turns out their crystal ball is no better than \u2013 well \u2013 college undergraduates.<\/p>\n

When it comes to applying innovation, use White Space teams.\u00a0 Drop all the business plan preparation, endless crunching of historical numbers, multi-tabbed Excel spreadsheets and Powerpoint matrices.\u00a0 Instead, dedicate some people to the project, push them into the market, make them beg for resources because they are sure they know where to put them (without ROI calculations) and tell them to get it done \u2013 or you\u2019ll fire them.\u00a0 You\u2019ll be amazed how fast they (and your company) will learn \u2013 and grow.<\/p>\n

via How Facebook Beat MySpace – Adam Hartung – Growth – Dealing with Market Shifts – Forbes<\/a>.<\/p><\/blockquote>\n","protected":false},"excerpt":{"rendered":"

photo \u00a9 2009 kevin | more info (via: Wylio)The following Forbes article is a interesting take on what happened to MySpace and contributed to it’s downfall and why Facebook is succeeding where MySpace failed. I found this even more interesting because the MySpace world outlined below is very similar to the environment of my last […]<\/p>\n","protected":false},"author":3,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_et_pb_use_builder":"","_et_pb_old_content":"","_et_gb_content_width":"","footnotes":""},"categories":[28,12],"tags":[187,634,66],"class_list":["post-2957","post","type-post","status-publish","format-standard","hentry","category-marketing","category-music-marketing-2","tag-facebook","tag-forbes","tag-myspace"],"jetpack_featured_media_url":"","_links":{"self":[{"href":"https:\/\/michaelbrandvold.com\/blog\/wp-json\/wp\/v2\/posts\/2957","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/michaelbrandvold.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/michaelbrandvold.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/michaelbrandvold.com\/blog\/wp-json\/wp\/v2\/users\/3"}],"replies":[{"embeddable":true,"href":"https:\/\/michaelbrandvold.com\/blog\/wp-json\/wp\/v2\/comments?post=2957"}],"version-history":[{"count":0,"href":"https:\/\/michaelbrandvold.com\/blog\/wp-json\/wp\/v2\/posts\/2957\/revisions"}],"wp:attachment":[{"href":"https:\/\/michaelbrandvold.com\/blog\/wp-json\/wp\/v2\/media?parent=2957"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/michaelbrandvold.com\/blog\/wp-json\/wp\/v2\/categories?post=2957"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/michaelbrandvold.com\/blog\/wp-json\/wp\/v2\/tags?post=2957"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}