26 April 2010

XPLANE joins Dachis Group

I have a big announcement to make today.

Effective this morning, XPLANE is joining the Dachis Group, the world’s leading social business consultancy, as a wholly-owned subsidiary. I want to take a moment to share what this means for XPLANE and our customers, and why I am excited about it.

Initially, the only change employees and customers will notice is the Dachis Group logo on our home page. XPLANE will continue to serve customers just as we have for the past 15 years. If you’re a customer, partner or employee, you probably won’t notice any differences at first. But joining the Dachis Group is a strategic move for our company and for our customers. Here’s why I am excited about it:

First, Dachis Group is backed by Austin Ventures to the tune of $50 million. This gives us the financial ability to scale so we can serve a growing and global customer base. The combined Dachis Group now has over 100 employees, with offices in seven cities and five countries.

Second, the Dachis Group is scooping up the best and brightest teams in social technology. Recent acquisitions include Hinchcliffe & Company, headed by Enterprise 2.0 guru Dion Hinchcliffe; Headshift, a social-business technology and strategy consultancy; and the 2.0 Adoption Council, a peer group of managers in large enterprises that are pioneering the adoption of Web 2.0 technologies and practices.

Third, the Dachis vision for Social Business Design is a sound and compelling one. They understand that social business is a fundamental shift not only in technology but in society and the fundamental ways that we do our work. Their vision for business transformation involves all aspects of business, from employees to partners to customers, from organizational culture to business systems to technology.

Fourth, CEO Jeff Dachis has a proven track record growing best-of breed internet consultancies. As co-founder of Razorfish, he grew that company into a global firm which successfully navigated the dot-bomb crisis and eventually its parent company sold to Microsoft for $6 billion. Now owned by Publicis, Razorfish is one of the world’s largest interactive agencies, with more than 2,000 employees and offices all over the world.

As a part of the Dachis group, XPLANE will be better financed and more strategically positioned than we have been in the past, so we’ll be able to grow faster and serve our customers better.

This move is also strategic for our offerings: As a visual thinking company, XPLANE has the ability to help our customers transform their businesses. Our customers will attest to that. Like any technology, visual thinking, and the clarity it provides, can accelerate growth and offer strategic advantage. But visual thinking, although powerful, is less imperative than social business.

For the last 15 years, the biggest thing that businesses needed to figure out was how to transition onto the web and into an internet economy. This was a disruptive change, a huge shift. Many companies perished and many fortunes were made. The risks and rewards were, and will continue to be, great.

In the next 15 years, the most significant change that business will undertake is the transition to social technologies. In ten years you’ll be a social business, or you’ll be out of business.

Why do I say that? It's pretty simple. All you need to do is ask yourself one question: Is word-of-mouth important to your business success? If so, you need to begin the transformation to being a social business.

There are a few things I can say confidently; things in business we can be certain about:
  1. Business success has always relied heavily on social networks and networking. Always has, always will.
  2. If you are early to recognize the potential of new technologies and build them into your business, you will gain competitive advantage and potentially claim new markets .
  3. The core of social technologies is that they make word-of-mouth conversations tangible, sharable and trackable. Do you think this kind of technology might drive real business results? I do. Word-of-mouth is the most trusted source of information, wisdom, references and referrals.
  4. You can’t opt out of social business, any more than you could opt out of the internet. You are part of the word-of-mouth conversation whether you participate or not. This means the transition to social is imperative.
New technologies bring change and disrupt markets. The more transformational the technology, the more massive the change and disruption. And social media has transformed life as we know it. Facebook has more users than the USA has people, and it’s growing at a rate of more than half a million people per day.

We have seen over and over that when it comes to disruptive technologies, the initial trends are set by individuals and small teams, and are later adopted by the bigger companies. Microcomputers, blogs, email, file-sharing, web services and voice-over-IP were all pioneered by small teams. Today, Twitter and Facebook are setting the trends. Individuals and small teams are using these tools now, and the corporate world is certain to follow.

But adoption of new technologies is not simple or easy, and the bigger the enterprise the harder it gets. Here are a few of the opportunities and threats you will have to navigate if you want to socially calibrate your business:

Customer service
Opportunity: If you’re a social business, you will respond faster to customer issues and thereby improve your customer relationships. You’ll have better product and service quality because you’ll have better feedback loops. You will simply understand your customers better.

Threat: If you opt out of social business, your competition will know more about your customer’s complaints than you do. They will swoop in and steal your customers before you know what hit you. They’ll be in a position to steer the all-important word-of-mouth conversation away from you and toward themselves. You’ll respond to customer concerns too slowly or too late.

Public relations
Opportunity: You’ll be continuously aware of the word-of-mouth conversation and how it affects you. Your social channels will serve as an early-warning system, enabling you to be more proactive and put out more fires before they start.

Threat: You’ll be surprised by a new trend because you’re not monitoring the social sphere. By the time you notice a PR fire it’ll be raging out of control and you’ll be operating in crisis mode.

Markets and marketing
Opportunity: You’ll be tracking the trend-setters and influencers and you’ll know how their ideas spread through the social network. You’ll know who generates recommendations and referrals – who drives the real growth in emerging markets – and you’ll know how they do it.

Threat: You’ll watch competitors or new entrants steal away your customers, and by the time you figure out what’s going on it’ll be too late.

Intellectual capital
Opportunity: Finally there’s a way to deliver on the promise of knowledge management – a way to capture the wisdom, ideas and genius of your employees – the information that’s contained in the heads of the people who walk out the door every day. I’m talking about the information that makes your business effective, even though it’s not written down in any book, manual or report. If you opt in to social business you’ll know who the experts are, and their peers will know how to find them and tap their expertise. You’ll know how information really flows through your organization – not the fiction of the org chart but the real social network that keeps things going. You’ll be able to cut meeting time in half by sharing routine information more effectively.

Threat: Your best and most brilliant employees will walk out the door and you won’t even know the value that you are losing. They will want to further their careers, so they’ll head for a more networked company where they can be more effective.

Is social media a fad? I’ll let this video answer that question:

Social business is like the internet or any other disruptive technology. The question isn't whether to do it or not: the question is whether you're going to be early or late. We decided to be early, and there's no turning back.

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paul van slembrouck said...

Congrats Dave! And thanks for the insights!

Erwin blom said...

Brilliant post, Dave. Thanks for the insights.

Doug DeSimone said...

Having been to the Dachis Group's Social Business Summit (#sbs2010) in Austin, TX this past March and then Stowe Boyd's Social Business Edge (www.edgewards.com) in NYC last Monday, XPLANE must be an incredible company! Maybe our paths will cross one day. Congratulations! - Doug

Kiko Suarez on Leadership and Change said...

Congratulations to XPLANE for having paved the road to new ways of thinking. Dave, you have shown wisdom at least twice in your life ;) Once when you founded XPLANE, and now putting it under the umbrella of Dachis Group. I wish the team the best of luck.


Marianne said...

Wow Dave...that's great...two of my favorite people, you and Peter Kim, under "one roof!!

All the best,

Peter Duke said...


Monique Elwell said...

Dave, I am so happy for you. You are brilliant and the work XPlane has produced regularly impresses me! Jeff Dachis obviously knows talent when he sees it!

david alameda said...

Congrats Dave!

Mike Simon said...

Fabulous and insightful post. Words every business needs to hear. Dachis is a much stronger company thanks to it's recent acquisition. What an amazing combination of talent.

Bobby said...

Thanks for the update. It sounds like Xplane is a leader of innovation and I'm sure this bold move will lead to some amazing things.

Unknown said...

Congratulations on today's talk in Zurich! I think I walked away with a couple of new insights!

Here's my post on your talk.

Adi said...

Muie la iehovisti, mormoni si atei!

paul smith said...

awesome post
Feel like I walked away with a couple of new insights!

Sean Zealberg said...

Nice video at the end...reminds me of this other video made from a cultural anthropology perspective:


^Perfect video for any web user unfamiliar with web 2.0 platforms.

The one you shared is very convincing for the unconvinced..I'll be sure to post it on my blog. Best of luck.