Law No 5: Global network effects
“This will result if you do the following right – the key element that is different about this, is that not only will your viral coefficient be greater than one, your cycle time will be very short,” Lee said.
Viral coefficient is a quantitative measure of virality, where it has to be greater than one to enjoy growth. The viral cycle refers to the time it takes from a user having a first look, to this user inviting the next user for a first look.
“The most important element that I have experienced about viral coefficients is that it is not the numerator that is important, but the denominator,” Lee said.
The numerator is the number of customers that each existing customer is able to successfully convert, multiplied by the conversion rate, according to Lee. The time it needs to get to the next customer is the most important part, he pointed out.
“If I WeChat you and two seconds later you sign up for a WeChat account, that’s very good,” he explained.
“But if you buy something and don’t tell a friend about it for a year, it isn’t very good – it doesn’t matter even if you tell it 10 times. That’s the element that is most important in the digital age – the cycle time,” he added.
This has to move beyond marketing and has to be built into the product itself, he argued.
Law No 6: Deep subject matter expertise
“The key element here is ‘unshackled’,” Lee said.
Lee quoted a CEO (chief executive officer) he used to work for, Harvy Golub, a prominent American businessman who told Lee that he was a ‘T-shaped’ man.
Lee defined ‘T-shaped’ as having strong vertical expertise, while possessing horizontal skills that can apply anywhere. He credited Golub for teaching him to be ‘T-Shaped” in subject matter expertise during his time in Wall Street.
Lee also brought up a Steve Jobs quote: “It doesn’t make sense to hire smart people and tell them what to do; we hire smart people so they can tell us what to do.”
“Deep subject matter expertise is not only about taking big risks, it’s about being an expert,” Lee said.
“At SingPost, when we were building our e-commerce team, we brought in industry veterans who had been through the ‘dotcom era,’ who knew what works and what doesn’t work, and could apply it here in Asia” he added.
SingPost CEO Dr Wolfgang Baier encourages risks, according to Lee, giving employees a ‘risk card’ – if they fail, they can pull out the risk card and tell him that they were only doing what he wanted them to do.
Walking the talk
“We are now positioned as the No 1 e-commerce solution in the world, and we are making further investments to increase our footprint and capabilities,” Lee (pic) told Digital News Asia (DNA) after his presentation at recent Forrester CMO + CIO Conference 2015.
While the transformation journey has not been without hiccups, the key to success is in the approach SingPost takes, he said.
“We had trial-and-error – if you look at the way we approach the process, it is very fast … such that we are not investing a lot of money in any given initiative,” he said.
“That enables us to learn quickly in the market, as opposed to learning through research or laboratory settings,” he added.
The biggest challenge SingPost currently faces is talent, according to Lee, “both in terms of finding the right talent to help us grow, and grooming the right talent.”
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