Defeating Wrap and Roll

Wrap and roll is a sales and marketing technique that involves a complicated set of maneuvers designed to placate your most feared competitors.  In most cases, wrap and roll is used by larger companies to attack smaller, disruptive, or fast growing start-ups within a particular niche market.  Whether wrap and roll slows, stops, or allows for M&A within a market, it definitely has an impact on innovation.

Wrap and roll needlessly confuses customers, prospects, analysts, and media.  It starts with an innocent phrase, “yes, we can do that and have done that for years” and ends with a new product launch, professional service bills, or an acquisition.  Basically, large companies cannot react quickly enough to smaller disruptive technology challenges.  However, these smaller companies typically lack the scale and market power of the larger companies.  Faced with the prospect of losing a key market, the larger company puts their machine into motion.

First marketing springs to action creating comparative charts, graphs, and FUD (Fear Uncertainty and Doubt) presentations that attempt to create an aura of superiority.   Second, technical marking tests the competitive gear to find weaknesses in the products and to share information with M&A teams.  Third, sales begin to circulate the marketing FUD and attempts to slow down the sales cycle to give them a chance to win.  Fourth, engineering teams attempt to create a new product while M&A teams look at potential acquisitions.  Fifth, engineering fails to create a product while the M&A teams decide that the top two competitors are too expensive and purchase a relatively unknown company.  (Note: This phase usually takes a long time as companies will get mired in the build vs. buy phase while trying to band-aid a solution together.)  Finally, the entire niche solution is renamed and put into a new suite of products that give customers increased functionality without additional licensing costs; maintenance is another issue.

While wrap and roll won’t produce one hundred percent success rates, it can be effective in slowing down a hot market by forcing proof of concepts, competitive bake-offs, and request for proposals.  Wrap and roll also serves as a mechanism whereby the larger company attempts to commoditize a growing market while stymying disruptive start-up behavior by choking off vital revenue growth.  An additional consequence of these actions is increased consolidation within the niche as other large companies seek to fill product gaps.

How do you defeat wrap and roll?  Guts, determination, listen, disruption, and an incredible team.

  • Guts; to say no.  No to the naysayers, no to due diligence, no to the quick payout.
  • Determination; to win.  To find roads where there are roadblocks, to work harder and faster than the competition, to know that we are the best.
  • Listen; to your customers.  Build what they need, deliver what they want, and give them what they desire.
  • Disrupt; all areas.  Provide a revolutionary product, present the wow factor, and support the heck out of them.
  • Team; in perfect cadence.  There is nothing more wonderful than a company that marches in perfect cadence and executes across all areas (executives, engineering, marketing, sales, etc.) of the organization.

Here’s to the companies that have the guts to build teams that have the determination to listen to customers and disrupt markets.

Cisco: No Shaking in these Boots

Over the past three weeks Cisco has watched Juniper announce stellar earnings, Brocade purchase Foundry, and now Siemens and Enterasys form a Joint Venture.  From the countless analyst reports, news articles, and blog entries, you would think that Cisco was on the verge of a complete collapse.

When Juniper announced stellar earnings, people wrote “it’s a two horse race.”  After Brocade made their move the headlines read, “Brocade gunning for Cisco.”  Finally, now that Enterasys and Siemens have joined forces, the headlines read, “Watch out Cisco.”  

Does anyone believe that these moves came as a surprise to Cisco?  Did John Chambers wake up to the San Jose News only to call an emergency meeting of his top executives?  Did Chambers lament about not buying Foundry’s problems, Enterasys’ flat-line revenue growth, or worry about Juniper’s identity crisis?

Perhaps human nature predisposes us to root for the underdog and loath the leaders.  However, this phenomenon seems to be particularly strong within the technology sector.   After all, does anyone loath Boeing or GE?  What feelings are invoked when I mention Microsoft, Oracle, Adobe, IBM, or HP?  Even Google has found that being the leader (by a wide margin) conjures images of evil and ulterior motives. 

Whether you can admit it or not, Cisco is a well oiled machine.  They have revenues of over $34 Billion, have over 60,000 employees, have a robust network of channel partners, and have a legion of certified Cisco engineers.  They understand that evolutionary technology changes come from within while revolutionary technology changes come from acquisition.

This week we are talking about Enterasys, next week we’ll be talking about Extreme Networks, and then someone will write how networking and Cisco have to change to meet the demands of “cloud computing.”   In the end, it’s all simply noise.  No one needs to wake the sleeping giant, because under Chamber’s leadership Cisco is not sleeping.

Save the sensational headlines and predictions for politics.  Cisco’s not shaking in their boots but the same may not be true for their competition.