I will cover this topic of Conversational Marketing more in the coming months, but for now the following paragraphs illustrate this direction I believe marketing is headed.

Thinking Ahead: Winning the Future of Retail

Recently I was at the National Retail Federation’s annual Expo in New York, a large conference and trade show for companies who serve the retail sector. Walking the aisles of the expo, one gets a sense of the direction of the future of retail. Mobile technologies, RFID, streamlined POS systems, data collection are fast making their way into our physical shopping experiences. What really struck me were those companies that were truly thinking ahead, who are making educated predictions as to the buying behavior of the consumer and the future of technology, and developing products based on this combination. One in particular stood out.

Developed by Cisco, the StyleMe^TM Virtual Fashion Mirror is essentially a TV hung vertically, with which the user interacts much the same way that one does with Microsoft’s Xbox with Kinect control (Cisco is using a PrimeSense camera, the technology behind Kinect). You stand in front of the TV, in which you see yourself, and choose from a catalog of clothing that it projects onto your “reflected” image in the television. In this way, you can try out various combinations to see how they look together and how they might look on you. Mind you, if you want to see if those jeans really look good on you, you still need to get your butt into them and trust your close friends give their honest opinion.

The technology is still rough. The clothes don’t “fit” perfectly on your reflected image, and there is a delay between your movement and the clothes catching up. But it is useful, and fun. Cisco is rolling it out this year with partner stores John Lewis in the UK. Certainly they will be collecting voice-of-customer on this, from both John Lewis customers and in-store staff, and using this information to improve the product. I imagine that in a few short years, this technology will work as smoothly as it does in Cisco’s promo video (http://youtu.be/XM9ZOWPeiAk).

While this novel gadget may help bring some people back into the brick-and-mortar location, our attention span for gadgetry is fairly short if this technology is not convenient or useful in our daily lives. Going to a store is not convenient. I would say that the real potential of this technology is in the home.  And while not everyone is interested in investing in an Xbox with Kinect, the PrimeSense technology that allows you to control your television with a wave of the hand – no remote required – will be quickly making it into your home. This year’s Consumer Electronics Show was ablaze with Smart TVs, most notably lead by Samsung (http://www.engadget.com/2012/01/11/samsung-smart-interaction-gesture-controlled-hdtv-demo-video/). HD is now ubiquitous; 3D is getting there, but limited by the production of content (and the required glasses are not convenient); internet connectivity and subscription services such as Pandora and Netflix are being incorporated into more screens. The next frontier is going to be the interactivity with the television, bringing together the motion control made popular by Microsoft’s Kinect, voice control popularized by Apple’s Siri (and Dragon software before), along with third party applications and the web. From making video calls (ala Skype or FaceTime), to having your emails read to you, to surfing the net, the future of this in-home (and also in-office) technology revolves around the convergence of all our technologies and toys.

Imagine five years from now you’re standing in your living room in front of the TV. On the screen is you, and you’re moving your arms around in a dance that brings up catalogs, clothes options, putting them on your reflected image, some moving to your shopping cart, snap shots being blasted to your Facebook friends to get opinions. Now let’s take this example even further and add in some of the concepts being developed by French company IntuiLab. You’re dancing in front of the TV, quickly scrolling through the retailer’s online product selection. At your “finger tips” not only do you have the store’s catalog, you have your own personalized catalog of your previous purchases from that retailer. You can now “try on” potential purchases in combination with purchases you have previously made (currently an idea incorporated into retail technology being developed by IntuiLab: http://intuilab.com/showroom/virtual-store-window-for-clothes/). Or if it’s getting close to the holidays, you have a virtual images of your family stored on the TV that you use to try different ugly sweaters on them, this time while laying back on the sofa, controlling the action with your iPad or other tablet. Taking it one step further, imagine a completely immersive, collaborative shopping experience where your friends are online as well, via Sype or Facebook, and they can “Like” or comment on outfits you’re trying out, and you can do the same for them. A group of friends can help each other and shop together, even if one is in Buffalo and the other in Boise (both places one may be more motivated to shop from home during the winter months).

Conversational Technology: A Marketer’s Overwhelming Dream

The amount of data marketers will be able to gather on overall tastes, preferences, trends, will be absolutely unprecedented. Popular combinations will be able to be used to construct dynamic catalogs based on real-time data. Think of iTunes “Genius Recommendations”, Pandora’s custom radio stations, or Amazon’s various “Recommendations”, only now it’s for apparel, with the recommendations model being updated as you try on outfits. Dynamic catalogs can suggest outfits, color combinations, sizes, shoes, etc. and users and their friends can simply give a literal thumbs up or thumbs down that their smart TV will read and communicate back to the retailer’s servers. Comparisons can be made across the data spectrum being collected, ala Netflix’ “Popular with Viewers Like You”, to include or exclude products from the catalog.

The interaction between the retailer and the consumer will move from the simple version of “interactive” we have today, to a more of a “conversation” between the marketer and the consumer. As fashion tastes can be unpredictable, the technology can simultaneously offer more choices while helping manage costs associated with this unpredictability. One particular segment of the market this may be particularly helpful with is the tween / teen markets. What’s cool today may be completely out tomorrow.  With the power of tools such as these, marketers can gather the data to push back up the supply chain to help manage costs, and maybe even forecast up and coming trends.

Take this example of the tween / teen markets and the implication on costs savings from the data collection, and expand it globally. The large multinational retailers can use this “conversational technology” to track trends across various markets. Political borders, already disappearing, will be replaced with trend maps overlaid on geographical maps, helping predict which colors, sizes, and styles will be more popular in Mediterranean Europe as opposed to Nordic Europe, as compared with Central Europe. This data can help accelerate product development, creating more accurate sales forecasts, and dynamic campaigns. With the ever-increasing real-time, hyper-local data, the power of marketing increases, but the high-level marketing strategy becomes even more complex. While online shopping today provides a virtual plethora of data possibilities, the upcoming technologies will increase this exponentially.

While the marketing strategist part of me is excited, the consumer in me is impatient…I’m just waiting for true, holographic smart TVs that can scan our bodies and project the clothes directly onto us so we can see if those jeans really do make our asses look good, without actually having to change a thousand times.  No more waiting for a dressing room, or ordering three sizes only to return two. Probably another 15 years, right about the time we’ll finally get flying cars.

Politician or Statesman?

From the end of World War II to the end of the cold war we lived in a bi-polar world, the global political stage dominated by East and West, represented respectively by the Soviet Union and its allies and the United States and its allies. In the years since the collapse of the USSR, the world has seen the political rise of China and the creation of new economic blocs such as the GCC, ASEAN, MERCUSOR, and NAFTA, each having their own political influences, expressed in one form or another.  Europe coalesced into a common economic zone and slowly a common political force, most recently with the ratification of the Lisbon Treaty and election of EU Council President Herman Van Rompuy and EU Foreign Minister Baroness Catherine Ashton.

While today we exist in this multi-polar world, bi-polar forces seem to be rising within many individual countries.  The United States has seen growing divides between the Republican Party and the Democratic Party, elections fractionalizing the population.  In the United Kingdom the current top-level competition of ideas is between Prime Minister Gordon Brown, leader of the Labour Party and his rival, Conservative David Cameron. Last week, Ukraine saw an election between Orange Revolution leader Yulia Tymoshenko and opposition leader Viktor Yanukovich, a bitter fight between the two sides that dates back to 2004 (ironically, Yanukovich had the assistance of political consultant Paul Manafort, who provided political counsel to the Republican presidential campaigns of John McCain and Ronald Reagan). 2009 saw elections in South Africa between the ANC and Cope, the opposition party who claimed South Africa would become a failed state should the ANC win. Only several days prior to this writing, the Dutch government collapsed, as the two largest parties could not come to an agreement on whether to pull troops out of Afghanistan. In one BBC interview on the collapse, a Dutch resident commented, “there’s two governments…one on the left side and one on the right side.”

Are these simple anomalies or are we, in fact, experiencing the rise of bi-polar trending?  If this is becoming a trend, it begs the question, why is this happening? Are more people coming to agreement and thus feel comfortable aligning themselves closer to one side or another? Or is this the age-old story of political power grabs, with a coalescing of power? If it is just political power grabs, then is this trending in the best interest of the citizens of the respective countries? If it is a case of more people coming to some agreement on certain issues, the pertinent question then becomes, is the reason for their gravitation towards one particular side because people truly are coming to agreement? Or is it a case of, “I don’t like Party A, but I hate what Party B is fighting for, so I have to support A to defeat B”?  Whatever the reasons, the results of this trending towards bi-polar internal conflicts seems to be leading to a higher rate of divisiveness, the tonality of the words ever becoming more bitter and in some cases apocalyptic, the dialogue turning from speaking with to talking over the opposite point of view.

It takes two to tango…and sometimes more

In the 2008 US presidential election, then Senator Barack Obama ran on a platform of change – change Washington’s modus operandi from partisan politics. While all politicians of late seem to preach that they will be bipartisan and reach across the proverbial aisle to work with their colleagues form the other side for the betterment of the people, Barack Obama was able to take this message to a new level, vowing to change the system of typical politics that occurred in Washington.  His campaign was keenly observed by politicians around the globe.  His success, once elected, in these endeavors of change and bipartisanship is an entirely different matter. The healthcare battle, which has turned bitterly partisan, along with such events as Senator Evan Bayh’s recent announcement at the disgust of Washington’s partisan ineffectiveness [paraphrasing], have not helped his cause.

Shortly after President Obama’s inauguration, the passing of Senator Edward Kennedy brought with it reflections on the late Senator that he was the last true statesman, reminiscent of an era where political rivals could disagree and battle for their beliefs on the parliamentary stage during the day, but at night the same representatives of the people could enjoy drinks in celebration of mutual respect.  Taming the bi-polar divide in the United States is a daunting task, some may say impossible.   In this case, it takes two to tango.  Should President Obama and Minority Leader John Boehner come out as true statesmen, put aside politics and elections (i.e. power grabs), look at each others’ ideas for merits, points of disagreement and commonalities, work together and change the tone of the dialogue from political rancor to debating issues based on facts, and lead their parties in this manner, then the United States may have a chance to move beyond the vitriolic bi-partisanship that currently exists.  The benefits may outweigh the sacrifices, including more than likely winning more favorable approval ratings for both their branches of government and their parties, and certainly gaining the attention and possibly emulation by politicians in other parts of the globe.

Belgium may provide some insight into the direction that the EU may be heading, and the EU has the opportunity to lead politicians, again by example.  Tension historically has existed between the two major Belgian regions, Flanders in the north and Wallonia in the south, and this friction every so often heats up. Most recently this happened in 2007 with talks of more autonomy coming out of the north.  Ultimately, Herman Van Rompuy, as Prime Minister of Belgium, was able to bring a sense of stability and calm to the rather heated debate, no easy feat. Certainly he was not the first to try, but he was the first in this go around to succeed.

Not even one year into his term as Prime Minister, Van Rompuy is tapped to become the first ever President of the European Union.  While there were certainly many political reasons for his selection, the fact remains that he now occupies the seat, and with it comes the opportunity to bring his talents of mediator and consensus builder, skills he is known for in European political circles.  While he cannot interfere in the sovereign affairs of any member state, ultimately he is a leader in the public eye.  Ambitious politicians in Europe may be taking note of this new reality, that being a unifier rather than divider has helped at least one politician accede to higher office.  Will their ambitions lead to a change in political tactics?  For success, it will take each side, the integrationists and eurosceptics, rising to a statesman-like level. This may be a challenge with politicians like Nigel Farage who seem to confuse the concepts of debate with insult.  Cooler heads may however prevail and Van Rompuy may be given the chance to lead.

Opportunity to underestimate…

Should President Van Rompuy be successful at creating constructive dialogue between the eurosceptics and the integrationists, dialogue that leads to a truly consensus-based common economic and foreign policy, whereby certain personalities are not trying to steal the limelight for themselves and their countries, politicians around the globe will take note and learn from Mr. Van Rompuy.  Should President Obama and Congressman Boehner create a series of truly bipartisan dialogues in the United States, some perhaps leading to solutions, again politicians around the globe will take note.  If both these scenarios come to fruition, then we may have a solid beginning to a movement where bi-polar or multi-polar will not matter as much as polarity will be surpassed by dialogue.  It will take statesmen to lead. Should they be successful, this will hopefully be a lesson taken to heart by their up-and-coming colleagues that the route of the statesman is the road to success – both for the constituents and the politicians. This is an opportunity to change history.

The inspiration for this piece came out of a discussion several months ago with a senior official of a European foreign ministry, shortly following the election of Van Rompuy. His observations on the reactions within political circles of this event, and theories as to possible impacts are what led to this posting.

The Tool Box of Tactics

One simple way to think about strategy and tactics is to look at tactics as the tools and strategy as the plan for the combined application of those tools, i.e. a plan detailing when the tools are used, how the tools are used and to what extent they are used.   It is, however, more than just a plan.  It is a plan that is crafted in such a way as to incorporate critical pieces of information that can have an influence on the performance outcome.

A strategy is a high-level view of the business landscape. It incorporates multiple pieces of information, which are then brought together to establish goals and an outline of how to achieve those goals.  As it is high-level, it can have multiple layers, the layers themselves made up of individual tactical plans. For example, a company could have a 5-year growth strategy, with an overall goal of market position and revenue at the end of the five years and certain more specific targets to be achieved at the end of each year.  As a part of this growth strategy, there could be a branding strategy outlining certain goals in terms of increasing brand value that contributes to the growth strategy.  The growth strategy could also have, as a part of its revenue targets, a certain number of updates or new products, each of which has its own strategy to compete and gain dominance within its specific category.  One of these product strategies (or product launch strategies) could in turn have an associated marketing strategy, which would support the brand strategy and help create dominance for the specific product. This marketing strategy (i.e. created using the marketing mix) would the be made up of tactical plans such as a public relations plan, trade show plan, and an advertising plan, the combination of which in conjunction with the overall strategic marketing goals.

Strategies may often be comprised of or affected by other strategies within an organization.

Start with the Fundamentals

In order to make the decisions about which tools to use and when, a basic understanding of the fundamental business environment is critical.  Starting with Porter’s Five Forces model can help to answer the strategic questions. Analyzing and understanding the threat of competition, the threat of substitute products (services), the barriers to entry, the bargaining power of suppliers and the bargaining power of customers helps to identify which tools should be used.  As the questions in each force are answered, interactions will begin to be seen, how one area may have an affect on another.  It is at this point that tools can begin to be identified, and the timing of their usage begins to take shape.

Strategy is a high-level guide. As such, begin at the highest level possible and identify specific goals. This goal identification tends to be one of the most complex aspects of strategy creation. Many heads of companies think, “we want to grow revenue” or “we want to increase our profit margins” is enough of a goal. Goals such as these are too general and do not provide enough of a framework to begin to craft a strategy. “We want to grow from 30% market share to 55% market share in the next 5 years” or “at the end of three years we want our overall profit margins to be 22%” provide guidelines. These are specific goals that are measurable; there is a time constraint and they take into consideration strategic forces such as competition, suppliers, and customers.

Adding Complexity

Taking this example to the next level, a cooking analogy can be helpful. As in the previous analogy, tactics are the tools – pots, pans, stove, mixer, spoons, etc.  In addition, they can also be the ingredients – eggs, butter, wine, mushrooms, tomatoes, etc.  Strategy is what helps create the end goal – a quiche, a veggie omelet, or a cream sauce.  Strategy helps dictate what ingredients are used when, in what quantities, and with what tools. Whisk vs. spoon.  Fold vs. whip. Over heat. How much heat? For how long? Which ingredients first, second, third, and at what time in the cooking process?

Any chef will tell you that cooking is chemistry, and temperature, ingredients, and timing will all affect taste, smell, and texture. Moreover, the latter two, smell and texture, will affect taste.  Texture can even affect smell.  Similarly in strategy, there will be multiple interactions. Taking the example given above, the marketing strategy for the product will affect the branding strategy for the company and vice-versa.  The marketing strategy can affect sales, which will affect the revenue strategy for the company.  Therefore, one should always be aware of possible interactions and contributions when creating strategies.

Simply Tactics vs. Strategic Planning: A Case Study

Two companies, Ducky International and Apex Global each develop a new widget (for this example, the product does not matter).  At the beginning of the planning process, the tools available to both CEOs are the same. They include pricing, promotion, staffing, distribution, and support.  The tactical questions are many: how should each CEO staff the project to oversee development, launch and beyond? What role will Marketing play? When is Sales brought in to the process? When should they begin to sell the product and what support will they receive? How will the product be distributed? What will the price point be?  The smart managers will look beyond the tactical questions and begin with the strategic ones: what is the company’s goal for the new product? How does the new product fit in with the overall company growth strategy? What specific goals might the company have, i.e. brand positioning, margins, market share, that this new product will affect?

A Plan and a Strategy

The companies take completely different approaches.  Ducky developed the product because the CEO was under pressure to grow the revenues of the company. The CEO told the head of Engineering to develop a new product and gave him a set budget. Engineering met with Sales, who, based on their experience, developed a list of what was needed in the marketplace in terms of functionalities, and Engineering in turn designed, built and tested a new product.

Ducky’s CEO focuses on the widget launch. Having decided that sales of the product was the sole goal, he brings in a sales manager to take charge of the product launch. Design of the product was handled by the Engineering department, but now that development was near completion, the CEO felt it was time for a sales manager to take control.  The sales manager determined a pricing structure comprised of a lower “introductory price” at launch, with a regular price being implemented shortly after the launch at a trade show. He had Marketing develop a page for their online catalog, highlighting the words “New” and “Introductory Offer”. Then he looked at his trade show schedule, spoke to Engineering about when he could have the product and / or mock-ups, and had Marketing develop POP (point-of-purchase) materials & signage for the shows.

Apex Global is a direct competitor of Ducky International. The development and launch of a new product line was part of the overall growth plan laid out by senior management several years earlier. At the beginning of the product development process, the CEO of Apex selected a product manager, who then assembled a multi-disciplinary team and set about laying out a development plan.  An initial list of marketplace demands was compiled. This was then tested with focus groups where additional information was gathered, and demands were refined. Competitive analysis was done on similar products from other widget producers, and a search of industry publications was conducted to determine who might be developing a product that could compete. The pool of information was then used to develop a sketch of what the new product should do and what its differentiating characteristics should be.

From here Engineering began working on designs, determining components and sourcing options and a cost estimate for full development was created. Simultaneously, the Sales and Marketing departments worked up a product lifecycle plan including launch plan, long term sales plan, and distribution plan. The Customer Service department worked up support and service plans including training schedules. Customer Service also worked with Engineering to develop a purchasing and supply chain plan for parts, as well as to gain an understanding of what additional tools may be needed for repair.  This collaboration between the Customer Service and Engineering departments helped in the development of a parts & equipment budget. The product manager oversaw each of the departments’ efforts, allocating resources when necessary, aligning goals, and crafting the next generation product development plan. Associated budgets were developed, combined with the engineering budget to create an overall product development budget. In addition to outlining costs, a revenue / breakeven analysis and ROI forecast were drafted based on competitive analysis, pricing strategy, and customer interviews, surveys, and focus groups.  A final proposal was presented to the CEO, who then made sure it was in line with and contributed to the long-term strategy of the company.

Reactive vs. Proactive Launches

Ducky launched their product at the first trade show of the year, which was not the largest of the industry shows, or the signature show where most new product launches occurred.  The thinking behind not waiting until the signature show, which happened in late Q3, was that they could book a full year of sales for the product while simultaneously being first to market with the newest product in the industry. Using bright neon yellow signs with red lettering, they promoted a special introductory price that was only slightly higher than existing models of their mid-range competitors.

Apex was aware that Ducky would be launching their new product. Word travels within industries.  While Apex risked losing first-mover advantage, they determined it was best to stick to their strategy, watch and learn from customer reactions following Ducky’s widget launch, and roll out the Apex product at the Q3 tradeshow, leveraging all the industry press that would be present.

In the end this is exactly what Apex did. Their marketing plan, developed as a part of the overall product strategy, included leveraging PR efforts such as “leaking” rumors at the Q1 trade show that Apex may be launching a next generation widget and just before the Q3 trade show sending advance release sample products to members of the industry press, building momentum for the official launch at the show.  The effect of the “leaks” caused some buyers to wait before making a purchase decision to see what Apex would come out with and how it would compare to Ducky’s. In every story and review about Ducky’s new product, the Apex rumor was mentioned.

Ducky ran into additional problems following the launch.  Raising the price from the “Introductory Offer” shortly after the trade show caused some frustration among potential customers – this was not a product that was a discretionary purchase. It was somewhat pricey and often involved financing. This frustration reflected poorly on Ducky’s brand reputation and was expressed through social media outlets among industry players. This also caused some to delay purchase decision, as mentioned, in order to be able to compare Apex’s pending product, even though Apex was known to be the most costly in the industry. Apex was, however, known to be the best.  Ducky did eventually reissue the introductory price as a result of the complaints and the constant, building competitive threat by Apex, however this was only honored at trade shows. Potential customers who spoke with the Sales team in between shows, if hesitant, were told of this special, and again word quickly spread throughout the industry.

Service was also an issue for Ducky.  As the new widget was managed by Sales, which took over from Engineering once the product was designed, support ended up suffering.  Sales did not have authority over the Service department, and during the planning process simply requested that Service work with Engineering to develop a service plan. The head of Sales assumed that the head of Service would prioritize an entire service plan, without any awareness of how the Service department functions, or active coordination between the heads of departments.  Engineering had shifted priorities onto the design of upgraded widgets to replace older models in a different line, so there was little coordination beyond transfer of schematics.  Moreover, Engineering didn’t inform Service what parts were the most likely to need replacing. As such, no volume purchase contracts were established, causing higher costs in not only components, but express shipping as well.  The result was that service suffered. Those few customers that had new Ducky widgets sent in for warranty service experienced less than top quality responsiveness or turnaround time. This again made it into the social media networks among industry customers, hurting Ducky’s brand and affecting sales. Ducky’s revenues suffered as a result of the pricing, service, PR issues, and competitive threat from Apex, causing Ducky’s CEO to readjust his breakeven timeline and ROI calculations.

Apex’s PR plan, combined with Ducky’s pricing and service issues, had successfully prevented Ducky from capturing first-mover advantage. While this certainly helped Apex, it did add pressure to deliver on built-up expectations and its brand promise. Apex was ready. They launched at the large show, with great fanfare, stealing any attention Ducky or other competitors may have wanted. Price was not mentioned in any promotional materials or in any of the presentations by the Sales reps. The focus was on the widget and its features.  Apex’s widget was on the higher end of the price scale, but this reflected their brand positioning. They were the “Mercedes” of the industry, a quality manufactured product, designed with the user in mind, and with all the bells & whistles. Price was only discussed when asked, and although not a discretionary purchase, finance solutions were available for those who had come prepared to make a widget purchase.

A Winner and the Rest of the Field

In the end, Apex’s strategy and Ducky’s lack of strategy helped not only Apex, but other competitors as well.  Apex knew that as the top-of-the-line widget they would not capture a high percentage of the market share. However, they were able to capture a significant percentage while simultaneously preventing Ducky from getting the majority. Ducky’s lack of strategic planning, combined with Apex’s marketing strategy and PR tactics, gave other competitors room to enter the field, thus diluting the market, and while Apex had the highest cost product, they captured the highest percentage of the market of any single company. As well, Apex’s strategy development guided revenue and profit margin targets, which led to collaboration among departments in the creation of supply chain and purchasing contracts, service, and distribution models, reducing bottom line costs.

Strategy Guides Execution: Making the Perfect Omelet

While this example may be basic and might seem extreme, it is realistic. Companies who think strategically, plan properly, and understand how tactics and timing make up strategy are the ones who end up succeeding. Going back to the cooking analogy, imaging trying to make an omelet with sautéed mushrooms, tomatoes, peppers, and shredded cheese. It’s much easier to slice the mushrooms, dice the tomatoes and peppers, and have the cheese shredded before turning on the stove.  Having all your ingredients in little bowls within reach of the pan is helpful. You probably want to sauté the mushrooms just before you start cooking the eggs. It is important to know at what temperature and for how long to have the mushrooms and the eggs on the fire.  A tactical approach in the kitchen, as in business, will usually result in a mess and leave you hungry. With a little strategic planning, however, you might just be the next Top Chef.

ORIGINALLY PUBLISHED 16 JULY 2009

Special Thanks for their input to Dean Amhaus, President, Spirit of Milwaukee and Britt Zarling, Director of Global Strategic Communications, Manpower group of companies (both also World Trade Center Wisconsin board members); to Jeffrey Joerres, Chairman & CEO, Manpower for his thoughts and support (Manpower is a corporate participant in the UN Global Compact); and Rich Meeusen, Chairman, President and CEO, Badger Meter for his vehement support and leadership of the Milwaukee 7 Water Council and UN Global Compact Cities Programme project in the Milwaukee region.

On April 28, 2009, Milwaukee was named a United Nations Global Compact City, one of only 14 in the world, one of two in North America. Local media provided some coverage of this honor, and the announcement event, held at Discovery World, was well attended by senior representatives from business, government, academia, and community organizations. While this is a significant distinction for the region, it is not an award to be hung on the wall at City Hall. Rather, it is a commitment — a responsibility taken on by a group of people and organizations, including the scientists at University of Wisconsin – Milwaukee’s Great Lakes WATER Institute, companies involved with the Milwaukee 7 Water Council, local and state government, and various community organizations such as the Spirit of Milwaukee, the Greater Milwaukee Committee and the World Trade Center Wisconsin.

So what is the UN Global Compact and how does it relate to Milwaukee? This United Nations initiative strives to encourage businesses worldwide to adopt sustainable and socially responsible policies, and to report on their implementation. The Global Compact is a framework for businesses, based on fundamental ethics and stating ten principles in the areas of human rights, labor, the environment, and anti-corruption. The UN Global Compact Cities Programme offers city leaders an alternative governance approach that seeks to find solutions to seemingly intractable urban issues by identifying, harnessing, focusing, and applying existing local capacity. By becoming a member of the United Nations Global Compact Cities Programme, it is the expectation of the Milwaukee region to begin to share our knowledge, expertise, and innovations related to water technology with the rest of the world. We want to help make a difference in global water quality.

It is quite a responsibility to solve a variety of problems associated with the maintenance and improvement of water quality, covering all facets of the water cycle and related issues, such as health issues, urban environment issues, improved food production environments, and technology development, and policy formation. But it is a responsibility this region has the unique ability to address.

Being an official member city of the United Nations Global Compact Cities Programme (UNGCCP) provides us with the global resources of the United Nations. To date we have identified 50 UN agencies and affiliated organizations around the globe that are dealing with water issues. As a member city, we will certainly be working with a number of these, linking our scientists and R&D engineers with other experts around the globe.

So what does this mean? Yes, it is an important issue, and yes, it is nice that Milwaukee has received this designation, but what does this mean for your company?

Branding: Helping increase Milwaukee’s visibility on the world map & establishing water as “cool”

How many times have you been traveling overseas when someone asks where you are from and you answer, “Chicago” or “north of Chicago?” Milwaukee is more widely known than most local residents are aware, but obviously nowhere near as well known as the major metropolises of the United States. Even if people have heard of Milwaukee, they do not necessarily know where it is located geographically. Jeffrey Joerres, Chairman and Chief Executive of Manpower Inc., a Fortune 200 international employment services firm headquartered in Milwaukee, considers this to be a combination of old and new. “These industry advances set Milwaukee as a contemporary city that is not locked into the traditional Midwest ideals. Although Milwaukee has the values and work ethic of traditional Midwest, these traits are not mutually exclusive. We are both firmly rooted and rapidly growing into the future.” This designation, combined with the work associated with it and the Milwaukee 7 Water Council, will help to increase the brand awareness of Milwaukee as a forward-thinking city, as well as to educate the world as to our physical location, tying us in the minds of the global community to one of the largest sources of freshwater and the most advanced freshwater technology worldwide.

Talent attraction: Working with the best on the most important will attract the best

One of the key benefits of working with the United Nations Global Compact Cities Programme is the exposure of our local scientists and engineers to other scientists and engineers who are currently working with additional UN offices or affiliated organizations on water related projects. The opportunity to work with the best, helping to solve one of the world’s greatest challenges and being affiliated with or able to leverage the nation’s first ever School of Freshwater Science, all while sharing results globally, presents a unique situation for researchers. This leads to a cycle of growth – where the talent goes, so do industry and money, which attract more talent, and the sequence is repeated.

Just as important as talent attraction is talent retention. We have a solid pool of scientists and engineers working in both academia and the private sectors in Milwaukee. Efforts to keep this pool of talent here are certainly facilitated by the confluence of events, capped by the UNGCCP. Moreover, we have an unprecedented set of opportunities to present our young engineers and scientists, from internships to job opportunities in a rapidly growing field. Richard Meeusen, Chairman/President/CEO of Badger Meter and Co-Chair of the Milwaukee 7 Water Council, has said, “Our vision is that, someday, when a young entrepreneur has an idea for a water technology company, all his relatives, friends and neighbors will say, ‘Go to Milwaukee.’” If this is where the best are, where the most opportunities are, this is where the students will stay after graduation and where they will choose to go to graduate school.

Foreign Direct Investment: Bringing business to Milwaukee

Not only will students stay here for the educational opportunities, but the advances in freshwater technology will generate new capital and create new jobs in the Milwaukee region. Following the cycle of talent and industry, companies will invest in the research and development of new water technology, bringing cash and private equity to help the industry grow.

The Water Council has already begun to make connections with the investment community. From angel investors to private equity, venture capital, and global exchanges, we are beginning to hit the radar screens of the investment community. Investment groups from Chicago, San Diego, New York, Zurich, and Hong Kong are just a few of the interested parties. The UNGCCP is a global megaphone announcing to the world that we here in the Milwaukee region have the resources, talent, capabilities, and expertise to help solve global water problems. Investors are always on the lookout for opportunity. We have that opportunity here. This is beginning to bring the investors. Investors in water lead to other investors, and the community grows. The money grows, which attracts the talent and entrepreneurs, and so forth. Again, the cycle repeats itself.

Increased opportunity: Committing to the future

New opportunities will rise as a result of this industry. The water industry is made up of many types of traditional businesses and disciplines – engineering, chemistry, physics, biology, and so on. The breakthroughs many of the technology companies will develop may have multiple applications, both in the water industry and beyond.

Some have said that water is the next oil. It is not. It is far more valuable. We lived without oil for millennia, and should we need to, we can do it again. Water, however, is an absolute necessity for the sustainability of life. When NASA explores other planets, the first step in the search for life is determining whether water is present. Water cannot be created. Water cannot be destroyed. But it can be polluted, ruined for human consumption. There is a finite amount of water on this planet; it must be explored for, conserved and sustained. The initiatives of the Milwaukee region in the water industry are diving right in and doing just that.

This designation as part of the United Nations Global Compact Cities Programme helps to make Milwaukee a destination. “Milwaukee now has the opportunity to be recognized on a global scale. Its image will appear in places and on lists that it never appeared before,” Joerres says.

We are the “it” spot for the moment. This is more than a project, more than an honor. “This is not just a one-time award. This is a commitment to how we conduct ourselves and living a certain way,” added Joerres. This is a sign that Milwaukee is changing, growing, that we are well on our way to reaching our goal of becoming the Silicon Valley of water technology.