Election Lessons: Pollsters, like politicians, are losing our trust

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BC premier Clark (source: cbc.ca); Alberte premier Redford (source: Calgary Herald)

BC premier Clark (source: cbc.ca); Alberta premier Redford (source: Calgary Herald)

After trailing in the polls right up to Election Day, the BC Liberals won another mandate. Another provincial election that the media and public are calling a “surprising” result.  The question arises: Was this really surprising? According to the polls, it was. Now, we are amidst a host of pollster “mea culpas” and those who are saying they got it “less wrong than the others.” Herein lays a new problem for the media, politicians and the public: our faith and belief in the accuracy of political polling.

First, let me disclose that I do conduct public opinion research as part of my business, and have done political polling in the past. Personally, I have long regarded this as a looming problem, one that has become a major problem over the last two years.

So, what is going wrong with all these polls?

Political polling is traditionally a test of accuracy of a public opinion research firm. It is considered a loss leader (typically below cost), with the expectation that an accurate poll result would build a firm’s reputation and attract new and more profitable business. Over the last decade, this premise has changed dramatically.

With the rise of the software-based polling methods – notably online polling using internet panels of self-selected respondents, as well as interactive voice response (IVR) systems (typically referred to as “robodials” by the public) – the cost of entry for new methods and firms has never been lower. Gone are the days of excellent response rates to telephone (landline) polls. And gone are the days of predictably engaging the public to garner their political inclinations.

Costs matter. We are in a new world – low voter turnouts, multiple communication technologies, social media platforms, and the use by parties of geo-demographic targeting and sophisticated voter identification methods to find supporters. These have dramatically affected the political polling business, and pollsters have been slow to adjust and/or they are not evolving their skills.

There is that old saying – “Fast, cheap and good. Pick two” – which is truly applicable here. While corporations typically choose a combination of fast or cheap with good, media outlets have opted for fast and cheap. The business model of polls and the media has evolved. Media are currently either cash-strapped or losing money, and thus, in most cases, either do not pay for political polling or pay for access to polls already conducted. I have colleagues who said they don’t conduct polls for the media unless they get paid. Well, there are a lot less of their polls in the papers now. During the last Alberta provincial election, a regional newspaper approached my firm to conduct a poll. We provided a quote to which they responded by asking if we could do it for free as “it would be good for your reputation.” We thanked them for the offer and declined.

Pundits play favourites: There is the additional dimension of politicos and the media’s obsession with the “horse race.” Many column inches are taken up with the analysis of poll results and insights from pollsters (some of you may include this article in that category as well). While these stories do capture the pulse of an election, they do not take into account the overall election ecosystem and the body politic.

There are deeper issues at play here.

After the 2012 US national election, Nate Sliver, most likely the most famous political statistician at this moment, published an eye-opening analysis of all the polling data collection methodologies and pollster accuracy. The findings were revelatory – fast and cheap methods had larger respondent biases (by supporters of specific political parties) and were less accurate.

Surprisingly, the best-performing poll was the Columbus Dispatch’s old-school mail survey. Overall, live telephone operator and internet panel polls performed significantly better than robodials. These methods were better at establishing a more population-representative sample that captured the diversity of opinion and voting behaviour. However, they are also significantly more expensive than the cheap-to-operate, large sample, conducted-overnight robodials. Clearly there is a trade-off here. This leads to three dimensions of polling itself:

What to ask in polls? Polling, in its cheapest form, focuses on the horse race. But elections are more than that. They are tests of political parties’ brands, the public’s confidence in the economy and their governments’ stewardship, the alignment of voters’ values with parties, and societal trust. Quality polling captures these elements, and how they wax and wane during the writ period. Quality polling also entails more in-depth, statistical analysis that addresses aspects such as tests of correlation and voter segmentation – aspects that Nate Silver and his more methodical contemporaries embrace.

Political war rooms use a variety of tools.There is an inherent misalignment between pollsters and party war rooms. Pollsters have polls. War rooms have polls, plus social media monitoring platforms, feedback from their ground network, content analysis of media coverage, text analysis of editorials and public comments, as well as voter identification systems. Pollsters mostly ignore this latter element, but parties are investing heavily in it. The Conservative Party of Canada use CIMS, while others are using Obama’s platform of choice, NationBuilder. These platforms are meant to address a question rarely considered in the media: What is a party’s secure and confirmed vote? Polls are not designed to capture this data, but voter identification is playing a larger role in election outcomes. Some parties are clearly better at getting their vote mobilized and to the polls on Election Day. The Conservative Party of Canada’s 2012 federal majority is a testament to this.

Further, data triangulation – finding the best insights across multiple sources – has always been a skill amongst the best war room teams. It is no surprise that data scientists – those with triangulation, interpretation and communication skills – are much sought after by political parties. Their talents are becoming more useful than those of the traditional party pollster.

A consistent misalignment of voter intentions and voter turnout. In most cases, answering a poll is not akin to actually voting. Polling exposes social desirability bias – I say I vote because it is the right thing to say, even if I don’t actually vote. Saying you want change and voting for change are independent events. This was evident in all of these “surprise” results.  In my opinion, the real metrics that matter relate to the committed/intending voter. These are poll respondents who have a history of voting (themselves and in their family tradition) and intending to vote on Election Day. In my analysis of polls from these “surprise” results, while it may result in a small respondent base with a higher margin of error, this number was a better predictor of voter turnout. Observing this metric within the content of the BC and Alberta elections, there were warning signs that things turned for the eventual winner earlier than what most pollsters believed.

While the emergent media/pollster business model requires careful examination, the current business model of the media overrides any quick resolution of the “fast and cheap” polling problem. It does, however, exacerbate the biggest problem for pollsters – one facing political parties and democracy itself: low voter turnout. BC is flirting with the 50% floor, and Alberta saw turnout drop to 41% in 2008. Another question arises: Is the silent majority of non-voters (considering them a block) satisfied with this situation? There is much research into this, but no matter what, their ranks are growing, and no amount of suspect polling is going to solve that problem.

Honeymoons, marriages of convenience and vote-splitting: Trudeau & Mulcair’s Challenge Ahead

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Photo: Toronto Sun, Dec. 28, 2012

Photo: Toronto Sun, Dec. 28, 2012

This article is based on an op-ed published in The Globe and Mail: 

Justin Trudeau predictably is now the Leader of the Liberal Party of Canada. With 80 per cent support based on an 82 per cent voter turnout, the win validates that he is the Party’s consensus choice to lead them to the next election. While his proposal and level of engagement appear strong, there is much he and his party have to earn to substantiate a future marriage with the voters of Canada.

Trudeau’s election this weekend came amidst the confluence of four independent and interconnected initiatives and activities: the NDP’s Policy Convention in Montreal; the upcoming May 13th Labrador federal by-election for the seat vacated by Peter Penashue; Joyce Murray’s call for collaboration among progressive parties; and thought leaders calling for a one-time collaboration with the NDP. All, in various ways, point to challenges that Mr. Trudeau will face over the next two years. And the unifying theme here is marriages of convenience.

By definition, a marriage of convenience is one contracted for reasons other than relationship or love. It is done for a strategic purpose and personal gain. The gain framed here, and called for by many, is one whereby Liberals and NDP form a one-time pact to win the 2015 election with a goal for electoral reform.

Let’s take a closer look at these events.

On the one-time collaboration, much has been written by thought leaders such as Andrew Coyne and Jamey Heath. They have all called for a coalition of the Liberals and NDP to defeat Stephen Harper’s Conservatives, and to change the First Past the Post system in favour of proportional representation. Within the parties, such collaboration has been favoured by Nathan Cullen and Joyce Murray, who each finished third and second in their respective leadership races. Like the thought leaders, they too crunched the numbers and surmised that 60 per cent of voters presents a real opportunity for a unified progressive party. Joyce earned just over 10 per cent of the points, but also attracted support from those seeking party cooperation, including Green Party and post-partisan voters (i.e., a growing segment with no party affiliation). This notion of collaboration speaks to the quiet majority of Canada’s progressives – a group that heavily favour electoral reform, desire their vote to matter, and who seek representation.

This leads to the forthcoming May 13th by-election. Many are calling for the original race to play out as it did in 2011 between the Conservatives (Penashue) and Liberals (now Yvonne Jones). In the spirit of cooperation, the Green Party immediately stated that they would not be fielding a candidate. However, the reality is that they never had a chance, and Elizabeth May – who has the most to gain – was not going to miss an opportunity play politics with this event. Meanwhile, Thomas Mulcair is adamant that the NDP are in the mix and stated “we have every intention of getting Harry Borlase elected.” While this may be a worthwhile endeavour, some may feel that this is a waste of their resources and could be a low-risk test of collaboration. This seat will likely return to the Liberals – solely on the events that lead to need for this by-election, and not the strength of the Liberal brand.

This leads to the last key event: the NDP convention on the weekend. Over two thousand delegates came to Montreal, in their 59 seat Quebec beachhead, their attention squarely focused on the 2015 election. Present were stalwarts, such as economist Joseph Stiglitz, associated with the U.S. Democratic Party. But the most dramatic event of the weekend was the dropping of “socialism” from their constitution. This is a clear play to broaden their appeal, move to the centre and improve their electability.

This brings us back to marriages of convenience.

Trudeau, a fresh face at 41, buoyed by recent polls, was always the clear choice for the Liberals. However, the most cynical would say that this was never a race. It was a marriage of convenience. Some may argue that Trudeau from Day One, because of his name, may have benefitted from the “halo effect” (i.e., judgments of character can be influenced by impressions of him and his name) – an effect that the party is hoping to leverage. No doubt pollsters will begin to investigate the substance and effect of the Trudeau brand, and his famous last name, among the electorate amidst this dead zone between elections.

But who exactly is Justin Trudeau? A likeable character with politics in his DNA, he appears to be open to defining himself and his leadership of the Liberal Party. His performance over the last four months has generally been faultless, and he established a track record as a revenue generator. In his acceptance speech he distanced himself from his father’s past, and decried the “negative, divisive politics of Mr. Harper’s Conservatives.” However, Justin is no fan of party cooperation; he is “unimpressed that the NDP, under Mr. Mulcair, have decided that if you can’t beat them, you might as well join them.” On the prospects of a party marriage, Trudeau speaks to the partisan core of Liberals in Canada here.

The reality remains, that a marriage between the NDP and Liberals is hard, Trudeau or not, no matter how you cut it, even if with their similar policies and positions,.  In my own polling over the last five years, there are notable differences between their supporters.  NDP supporters are mix of highly-engaged, educated, socially active innovators and less-connected older, blue collar union-oriented types. The Liberals, by comparison, look a lot more like the Conservatives in terms of age, education and social and political engagement. A recent poll by Abacus Data (March 19-21, 2013) indicated that the second choice party for over one-quarter (28%) of Liberals would be the Conservative party. For Conservatives, a Liberal vote would be the second choice for over half (57%). This is understandable. Liberals and Conservatives are the only parties to ever lead the country. Even while they hold one-third of the number of seats as the NDP, most partisan Liberals still view their party as the natural party to lead Canada.

Deja vu all over again

Much of this new round of dialogue about marriages of convenience emanated from the three by-elections last November – specifically, the one in Calgary Centre, where progressives managed to get 63 per cent of the vote and yet lost to the Conservative. There were a number of critical events, connected to this by-election, beyond low voter turnout, that both Trudeau and Mulcair should consider:

  • Of the three centre/left parties, the Liberals were the most unwilling to cooperate –  even though the candidate (Harvey Locke) would have been the beneficiary of cross-party support and would easily have won with unified, progressive support.
  • The Green candidate picked up support from disaffected and former Liberals.
  • The NDP fielded a full campaign, with a late-entry candidate, even though they never stood a chance.
  • The three centre/left parties each fielded a fantastic candidate – each a quality individual who voters would have been happy to get behind, but instead ended up splitting the vote.

Sounds familiar? Painfully familiar to many voters across Canada.

With the Liberals re-emergence in the polls under Trudeau’s leadership and Mulcair moving the NDP to the centre, voters can expect more of the same for the future. This lack of consideration does not bode well for progressive voters. Recent research by Samara (December 2013) found that 55% of respondents were very/somewhat satisfied with the way democracy works in Canada – down from 75% in 2004. Samara also found that the public were dissatisfied with their MPs – a dissatisfaction driven by the thought that MPs do a better job of representing the views of their parties than they do representing their ridings and constituents.

Either way, Mulcair and Trudeau will continue to lead their parties for a share of about 60% of the electorate. Harper likes this math and continues to quietly cement his support with the balance, with a hope that the vote-splitting will likely lead to another Conservative majority. The reality of electoral math is that, beyond most partisan faithful, the centre-left is running the risk of frustrating their base.

In the absence of cooperation, Mulcair and Trudeau have to demonstrate that they and their party brand are relevant for Canada – relevant and in tune with the desire of the electorate for quality representation – and that they do reflect the values and aspiration of Canadians. Not just 60%. But to make inroads into Conservative support to grow the progressive pie, they need to demonstrate that this is not simply about defeating the Conservatives; it is about inspiring Canadians to consider their vision for the country while, at the same time, rebuilding the guts of their parties and building meaningful relationships with Canadians.

It is still in the eyes, minds and hearts of Canada’s progressive electorate, two (and three) sets of party infrastructure squarely aimed to get their vote. And both have their challenges. Of the two-thirds of Canadians voters who lie within the centre/left spectrum, Trudeau needs to convince them that the Liberal Party is the one of the future and to move them out of the doldrums of 35 seats to Canada’s second party (at worst). For Mulcair, the challenge is to show that the NDP is a party that can lead the country. Either way, Harper and the Conservatives are moving along with their existing strategy and will continue to stoke the fire that divides progressives.

Another key event of the weekend was the presence of Jeremy Bird, co-founder of 270 Strategies and Obama’s national field director for his successful 2012 campaign. He told the NDP convention delegates to use “Moneyball-style” analytics, establish meaningful relationships with voters, and build a strong ground game to win elections.

If executed, the problem remains that the Liberals and NDP will continue to approach the same pool, courting similar voters. Thus, the immediate challenge for both Trudeau and Mulcair is for each to annex the largest share of the pool, and then woo others who are in the remaining smaller share. And most importantly, woo those who have not turned up to the pool at all.

In the absence of any resolution on cooperation, Trudeau as Liberal leader and Mulcair with a new constitution both appear to have committed their party to another individual battle in the 2015 battle. Regardless of the state of or interest in partnership, like any marriage they have to earn the trust of the electorate. And they need to remember that a strong marriage is based on an alignment of values. Values of Canadian progressive voters that continue to taxed and tugged two and three ways.

Analyzing the Conservative Party of Canada’s Success: Lessons for the Centre/Left

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The headlines last Friday read that if an election were held today, Justin Trudeau would be the Prime Minister. Accompanied by a seat projection, the forecast was that the Liberals would hold a minority government. Given my vocation, and a few days reflection after attending the 2013 Manning Networking Conference, Canada’s centre/left parties would be challenged to dislodge the Conservatives now and in the immediate future.

Preston Manning

Crunching polling data alone does not provide and accurate picture of what a potential election outcome. The Conservative Party of Canada clearly understands this. While it may be easy to criticize them on racking up the national debt, stifling the voice of government scientists and lampoon some of their representatives, conservatives across Canada have been successful in elections across Canada – they now hold more than 50% of the seats in federal and provincial legislatures. With sustained support, it is clear that Harper’s Conservatives, the brainchild of Preston Manning, have a clear grasp on their support base. While many a pundit and partisan supporters continue to dismiss their strength and cohesiveness, there is much the centre/left can learn from their ascendancy and organization.

First, the Conservatives have a strong grasp of electoral math. After coming close to a majority in 2008, they retooled their voter identification systems and deployed more data-driven approaches into their strategy. With the adoption of mapping tools borrowed from trade-area analyses, combined with demographic and voter analyses, the Conservatives targeted specific ridings and pockets of voters to create a winning condition. Further, every current form of communication is designed as an experiment and measure – use of bar codes, on promotional material and postal code tagging. This has helped the Party construct rich data sets that are being mined to shape messaging and targeting strategies to appeal to the existing base and motivate potential supporters. These techniques are remarkably effective. As a data scientist with pollster leanings, these are some of the techniques that we deployed in 2010 to support Naheed Nenshi’s successful mayoral campaign.

In fact, analysis of the 2008 and 2011 Federal Elections, presented by Mitch Wexler of PollMaps at last weekend’s Conference, redistributed across the new 338 ridings indicates that the Conservative Party of Canada would have won by massive majorities. A presentation by Sasha Issenberg, author of “The Victory Lab,” at the Conference indicates that they continue to explore the opportunities offered such analytical techniques. Using such data-driven approaches, the Conservatives are intent on growing their base, and as stated by Minister Jason Kenney they are intent on exceeding 40% support at the polls.

Appealing to New Canadians is another pillar to the Party’s success. Kenney, given his work with visible minority communities in the 905 region, was considered the architect of the Conservative’s 2011 majority. This so-called ethnic vote was long considered the stronghold of the Liberals. The Conservatives, given that they were stuck at one-third support and leading a minority government, identified the strong potential of this voter segment to grow their base. The strategy deployed by the Conservatives, he stated at the Conference, was straightforward – listening, alignment and commitment. By listening to what new Canadians wanted, the Conservatives considered how their values align with the values of New Canadians. In doing so, they were able to demonstrate to these communities that they were the party that best represented what being Canadian was about. And by encouraging New Canadians to become more active in the political process, through organization, volunteering and supporting their own community leaders to ensure that their voice was heard policy matters in Ottawa, they demonstrated commitment. This strategy was not lost on Conference organizers – of the 200 students attending (approximately 30% of attendees), a large share were from the Asian and South Asian communities.

Messaging is another Conservative strength. For the last five years the conservatives have been hammering away that they have been strong on the economy. Contrary to the actual situation of a growing deficit, poll after poll has indicated that the public believe that they have been doing a good job on the economy. Looking back over the last two decades, the Chrétien Liberals tamed the deficit and delivered budget surpluses year after year. However, Harper’s Conservatives have managed to make economic stewardship their own, simultaneously portraying the Liberals as weak in this area. The strength of messaging extends to the Conservatives advertising campaign on their Economic Action Plan. With a large media buy – with television ads seeming to be on air every five minutes – they know repetition drives home the point and reinforces this message. Recent polling by the Manning Centre indicates that Conservatives are perceived as being weak on the environment. They have realized that this is area is a blind spot, but it has not been fully realized by any party. So, stay tuned for their “Green Conservatism” platform.

Conservatives have also become meticulous brand managers. This is a party that has a strong understanding of its identity, vision and mission. From a communication perspective, branding is about the way that you do politics, the beliefs and culture of your party, the dedication to your platform and the belief/emotional bond that you have with your constituency. The Conservatives, amidst gaffes, prorogation and heavy-handed omnibus bills, have worked hard to define their political brand to their supporters. And in defining themselves, they have centre-left parties trying to figure out what they stand for. Observing the Liberals and NDP on this point, beyond their committed voters, they lack a clear brand or identity amongst independent and post-partisan voters willing and ready to embrace them.

The dimensions of being strong on the economy and having a winning brand are fundamental to the next component of success – attracting the business community. This is another area of alignment where the Conservatives have vested time, and communicated that they are open for business through tax cuts and business incentives. The business community supports parties that are committed to their needs, willing to stand up for their interests and are stable in power. With a majority government, Canada’s business community is aligning itself with the Conservatives. This in turn leads to attracting stronger financial support – the Party has a good cash position, while Manning’s initiatives have secured generous corporate support.

Infrastructure is also a critical component to the Conservative’s success. Most of the prominent think tanks in Canada – such as the C. D. Howe and Fraser Institutes – are conservative. While they crop up in the media to release findings from their policy papers and reports, institutions serve more important roles to the Conservative’s cause. Beyond defining the ideas for policy, they train the next generation of representatives, staff and media. The next wave of such institutions is embodied within the Manning Centre for Building Democracy. Embedded within is the School of Practical Politics, which is geared to attract young conservatives straight out of university to be part of the conservative machinery – from organizing campaigns to becoming a political representative. Manning has stated many times that at Starbucks you require 30 hours of training to become a barista, but you don’t require any training to become a politician. Thus Conservatives, with Manning’s tutelage, are seeking to ramp up the role of institutions for what they hope to be a strong conservative future of Canadian politics.

A final critical element to success has been the complacency of the centre-left to ignore or not fight all of the above. The points presented reinforce how the Conservatives are setting the agenda in Canada, and for every other party to react to and follow. With success at the federal and provincial levels driving their appetite for power, the Conservatives are now targeting their efforts at municipal government. Manning stated that there are 25,000 council positions across Canada that need to be demonstrably more conservative.

While many can complain, campaign and present thoughts on how to defeat the Conservatives, the reality is that the centre-left need to learn, like Manning and Harper, to define a clear identity for themselves and why they are relevant to Canadians. And more importantly, the patient, disciplined steps and actions required in establishing the necessary infrastructure and support to regain their political footing in Canada.

For audio files for content discussed above, please listen here.

The Algorithm Method: When serving the customer is not properly thought through. The Case of TD Canada Trust Visa.

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I had an incident with my credit card a couple of weeks ago (May 3, precisely). And it underlies the frustration that customers can have with incompletely thought through data algortitms.

I travel quite a bit and keep an unlocked cell phone with me. When I get a new cell phone, I usually buy it outright and arrange my contract after. I had selected the delectable HTC1 for purchase and as the store attendant swiped my card and punched in the authorization code, the card was declined. He was instructed to ask me to contact TD Canada Trust Visa – my credit card company – immediately. The attendant was kind enough to let me use the store phone. When I spoke to the credit card customer service representative (CSR), I was informed that my card had been compromised. Specifically, a merchant had their swipe unit compromised and TD Canada Trust Visa had cancelled all the credit cards that were used at that merchant during this specific period of time.

This is a good example of how credit card companies are using information to detect potential compromises of their product on behalf of their customers. This is a very good thing – it mitigated the risk of intrusion of my privacy and financial information.

However… as soon as the card was compromised, there should have been an indicator within the system to contact me directly to explain what had happened and that my credit card needed to be replaced.

There is another wrinkle to this (and likely the subject of a future post). Unfortunately, credit card companies call on toll free numbers. Given the high propensity of telemarketing calls I receive trying to sell me insurance products, long distance calling to India and furnace/duct cleaning (and we have radiators, not ducts, in our home and have repeatedly told them that), I do not respond to toll free numbers. This is now what we refer to as a first world problem. (Suggestion: Banks/Credit card companies may want to consider texts as a form of contact.)

So…

With no credit card, I had to use a personal card to cover the cell phone transaction. I seem quite comfortable with the thought that the credit card company was looking out for me and that they would be able to replace my card quickly. However, I was also cognizant that this was my business credit card, I had a number of direct withdrawals that I had sanctioned on a monthly basis – this included my accounting software, my internet, PayPal and business telephony, my IT service provider and my cell phone provider among other things. The credit card CSR informed me that the direct withdrawals would be automatically transferred to the new card. However, this was not necessarily the case. I did decide to give TD Canada Trust Visa the benefit of the doubt. The card was duly available within two days and within that time I had received a notice of declined payment from one of my direct debit withdrawals.

There is also one other piece of information that is critical to this in terms of assessing what the point of this post is. My credit card was due to expire in June 2012. Next month to be precise. For those of you who have direct withdrawals, a change of a card is generally a pain in the ass. You have to contact all of the companies that have a direct transaction with your card to inform them that you are changing the card – may it be number or expiry date – to ensure that they have the latest information on file so as you don’t suffer with a penalty of non-payment.

The card was duly available within two days as promised. However, when I picked up the card at my local TD branch (May 5), I noticed that the new card was only valid for one month – its expiry date was still June 2012.

After being informed that the direct withdrawal transactions would be automatically transferred to the new card, I asked the counter clerk at my local branch to verify this with their supervisor. Information came back – as I expected – that I had to contact all the companies myself to do this. This angered me to no end. I then asked to speak to the Manager to explain to him what the problem was. He was very patient and accommodating as I explained to him that in issuing a one month card, they have caused a great deal of aggravation to me – I had to contact all of my direct withdrawals not only once on the change in card but twice on the new expiry date (on my own time and at my own expense). Further, if I missed any payments, I would be incurring additional expenses. He, like the TD Canada Trust Visa customer service representative, assured me that they would automatically be transferred and I explained to him that this is not the case and TD Canada Trust does not do this. I insisted that he follow up and confirm this.

I left the bank quite frustrated because I had undertaken a great deal of due diligence on my part to follow through with all of the companies that have direct withdrawals with my company, only to have to now contact them a second time. Upon returning home, I received a call from the Manager stating that I was correct and that I had to contact the companies twice to inform them of the changes to the credit card.

So, what is the point of this post?

This is a great example of where a traditional institution is becoming progressive and better at fraud detection and establishing algorithms for detection to the benefit of their customers. As I said before, this is another good thing.

Also, banks and corporations have encouraged customers to have direct withdrawals with their credit card on a monthly basis so as not to miss any transactions. This also is a good thing, and very convenient.

However, when you implement a system of fraud detection connected with a system of direct withdrawals, you need to think through the system completely to the point of what can inevitably happen to the card user. Banks in detecting fraud also need to detect the direct withdrawals attached to card and implement a system to transfer these over to the new card for the convenience of the customer. In this particular case, an old school institution – namely TD Canada Trust – did not think through the algorithm method carefully enough.

If you have a system where fraud detection is connected to a system of convenience, then the system of convenience needs to take equal footing with the fraud detection.

To date I have now spent almost a day cleaning up this mess and will most probably spend another day and a half on this. As I pay TD Canada Trust a hefty sum to have a corporate credit card, they enjoy all the upside of maintaining an asymmetrical algorithm. I, on the other hand, am stuck with the hassle of having to go and clean up the fallout of their due diligence, much to my aggravation and frustration and the fact that this time could be better spent on business development. I wish I could charge them for the time that they have stolen from me to help them understand how problems with the algorithm.

A handy article on this topic: The algorithm method: Programming our lives away; by Ira Basen.

“It took a threat from the right to revive democracy in this province.” – Brian F. Singh

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Apart from the surprising majority earned by the Alberta PCs on April 23, much attention has also been paid to the equally surprising performance of the pollsters, virtually all of whom got it wrong, maintaining that the upsurging Wildrose Party would end more than 40 years of Tory reign.

In his comments quoted in two articles in the Globe and Mail, Zinc president Brian F. Singh says that these results as a wake-up call, not only to the PCs (who faced a formidable challenge for the first time in years), who many pundits and public though were going to lose the election, but also to the pollsters, whose traditional methods failed to respond – or truly understand and engage – the grasp the electorate’s real concerns, trending shifts and underlying motivations for voting intent.

To view these interviews & articles, click on these links:

CBC Interview (Calgary EyeOpener, April 27, 2012): http://www.cbc.ca/eyeopener/episode/2012/04/27/tory-election-win-in-alberta/

‘Entire environment shifted’: Pollsters seek answers after Alberta vote: http://www.theglobeandmail.com/news/politics/entire-environment-shifted-pollsters-seek-answers-after-alberta-vote/article2412816/

Fear of Wildrose drove some voters to Alberta PCs: http://www.theglobeandmail.com/news/politics/fear-of-wildrose-drove-some-voters-to-alberta-pcs/article2412023/

Memo to RIM leaders and team captains everywhere: If you think you are going to keep winning, you are going to lose

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This past Monday, I woke up to the news that Jim Balsillie and Mike Lazaridis were stepping down as joint CEOs of embattled tech giant Research in Motion (RIM). Waterloo-based RIM’s descent has been well documented; and we know, too, that this decline has continued even as RIM continues to do well in the business market as well as elsewhere in the world.

Considering “elsewhere in the world,” most of my friends and colleagues know that I am a big fan of cricket. Right now India is wrapping up a test series (long form of the game) against the Australian team and have performed poorly. The Indian cricket captain, M.S. Dhoni, like his RIM counterparts, helped build India into a cricketing powerhouse, leading them to victories in the World Cup T20 Tournament and the coveted World Cup of Cricket Limited Overs tournament last year in India. Notwithstanding the greatness of these leaders in delivering many solid wins, in both cases their organizations have been in decline since attaining their creative peak.

So what is going on here?

Let’s consider five things:

The “what’s new” business is a high-pressure game. While the mobile market is effectively a utility, its devices, functions and capabilities are not. They are actually all about the latest and greatest, keeping users at the cutting edge and having a host of online capabilities at your fingertips, literally. RIM was caught off-guard first by the rise of the iPhone. Then came Google and Android, and an incredible array of low-cost devices with high capabilities and superior function, and in a heartbeat RIM found itself far behind in the touchscreen market. It is in this sense – that they were no longer innovating, instead remaining complacent with the steady growth of their core products in the business market – that RIM failed to respond to what the “what’s new” market demanded.

Losing touch with the hyper-engaged. Based on the tracking in our ongoing study, The Bridge, Zinc Research has for several years flagged the demise of RIM and the ascent of Google and Apple in Canada. Our key point here is that this trend was seen first specifically by the user segment we defined as the hyper-engaged. While these data are specific to Canada, the numbers are also applicable to the US – and in both cases the hyper-engaged segment is far and away the most critical market in terms of who drives the trends in the mobile market (and many other technologies). The take-away? If you stay committed to your products and your service platform, you will remain attuned to the hyper-engaged market. If you fall out of favour with them, it is your company’s imperative to move quickly to understand, and respond to, their changing preferences.

Brand. This is about the way you do business, the belief in your business, and the culture of your business. It is the alignment of all these elements that has the potential to create a powerful brand. For many years, through the vision and application of Lazaridis and Balsillie, RIM was at the top of their game. They focused on the key constituents of their product, primarily corporate security and e-mail, and delivered superbly for many years. However, once the game had changed to more touchscreen-oriented devices, their brand and the culture of the company were not able to align with the way they were doing business and with their belief in where the business was going. As a result of this misalignment and shift in culture, as well as RIM’s paucity of  innovation, the premium attached to the RIM brand was severely eroded. Further, the cache of the RIM devices declined rapidly in comparison with the increased functionality of touchscreen devices and the integration of online marketplaces and apps.

Knowing when to leave. Returning briefly to cricket captain M.S. Dhoni, again there is little doubt that he is a hard-working genius. He delivered India’s greatest cricketing championships and took his team to the top of the world test rankings. However, over the last year, India’s test performances have been poor. It’s true that India’s team is aging, but the fact is that Dhoni’s captaincy has lacked creativity.  After taken India to the top, it is likely that given the demands of the modern game, fatigue was setting in. Similarly, the fatigue factor for RIM’s CEOs has been well-documented, i.e., Balsillie’s distraction with the NHL and Lazaridis’s activities in other initiatives, such as the Perimeter Institute, all of which have affected the success of RIM. Much was invested in the leaders’ vision with respect to how RIM would evolve, and by the time the market was well in decline, the grave realization of their inability to turn the RIM ship around was evident.

This aspect of departing post-crest has many implications in terms of “going out on top,” but more importantly, going out only after you have invested the time and energy to ensure that creativity and product innovation will be sustained. (As noted before, mobile telephony is no longer a utility business (that’s the service providers); it’s a “what’s new” business). One can look at Steve Jobs and consider his initial departure from Apple: He had delivered a substantive win with the Macintosh but was forced out shortly thereafter. We can only imagine what would have happened if he had stayed on, but on the other hand, as Jobs himself often said, during this time away from Apple he renewed his passion for the product and the company. On his return, he was committed to making great products and building the Apple brand. Consequently, this time he had the foresight to consider the legacy of what Apple could become; indeed, even before his tragic death last year, that foresight had already become a cornerstone of Jobs’ own legacy.

The Canadian entrepreneurial climate. Canada has a good track record in innovation. However, it has a poor track record in taking the next step. Canadians are very adept at building solid companies that perform well but which then falter when they hit that critical point of staying attuned to the market. Part of the fault is the culture of complacency fostered in Canada. This is akin to seeing first-generation business leaders doing exceptionally well, followed by the next generation that squanders their hard-fought gains. But this problem runs much deeper. Today in Canada there seems to be a greater sense of self-interest, and an unwillingness to share, compared to other centres of innovation. RIM under Balsillie and Lazaridis hit that point about five years ago. Things appeared to be on a solid roll, but in fact the truth was that some of these bad behaviours were starting to set in. Entrepreneurial success is more about sharing and being connected to the world than about absolutely locking in and protecting your product and market. It is about striving for excellence and commitment to being a great business.

Returning to cricket, one can look at the Australians, whose team culture is one of constant re-invention. Apart from a period in the doldrums in the 80s, the Australian cricket team has always been effective in knowing the right time to change leadership and the composition of the team. There have been many unpopular choices that have made it onto the field, but the team has done remarkably well based on a willingness to give such players a chance, and to learn-by-doing in the theatre that international cricket affords. Over the last 20 years, the shift in captaincy from Allan Border from Mark Taylor to Steven Waugh to Ricky Ponting and now Michael Clarke has demonstrated a commitment to staying innovative and true to the “Baggy Green” brand, but also to staying in tune with the shifting tides of what the demands of the global game require. For entrepreneurs and other business leaders, there is much to learn from successes, and losses, like these.

Giving Research the NOS Effect. Betty Amadou, Research Through Gaming (Net Gain 6.0 Presentation)

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Key points raised:

  • NOS – Nitrous Oxide – Go faster! But make research more engaging!
  • Games harnesses lots of things. While research too… but lacking creativity and don’t demonstrate our industry’s passion.
  • People have a voice, but not willing to share as it appears that we are listening poorly.
  • Culture: What I want I get… 2 way communication.
  • Surveys are not interactive.
  • Can we improve through gaming?
  • Start you research via storyboarding.
  • Built in timing mechanism – becomes a data stream onto itself.
  • Share information among respondents.
  • Coin the term: Playspondent!
  • Give people a WHY to participate in the research.
  • Kids would love this stuff. Young adults (especially male) – hard to reach – would find this engaging.
  • Respondents don’t see the cool things the MR industry is doing!
  • Better to focus on game mechanism (no bright colours, etc.)
  • Good example of gamification: Pottermore, Weight Watchers, AnUvaHood.
  • Gamification has associated affects… may promote actions within “real life.”
  • Rule, mechanics, guidelines and rewards.
  • Get at introversion and delve into creative thinking.
  • Avatars help cross the empathy gap.
  • Have a clear goal in mind!
  • Keep it social.
  • RAVA & CABIN (follow up with @BettyAmadou on that!)
  • Really make the rules of the game clear!