And they’re off. The 2012 US Presidential Election kicks off today with the Iowa Caucuses. Just as the Christmas shopping season waits until the last turkey sandwich has been devoured, the US Presidential elections hold off for the last dose of New Year’s hangover cure. News pundits will now be surveying, charting and dissecting the voter segments for the next 11 months nearly to the day.

For the candidates, it’s a mammoth marketing exercise to ‘get their message across’ and attract custom in the currency of a ballot. A piece by Robyn Griggs Lawrence cited Kevin Salwen, founding editor of Worthwhile magazine, which put forward that marketing political causes are an example of the 70-20-10 Rule…

• 10 percent are just never going to buy into our message – Bigots/Detractors
• 20 percent are already on board – Advocates
• 70 percent are out there just waiting to be touched and inspired – Swing

Lawrence and Salwen are spot on here. There are fanatic fans and fundamentalist foes with every cause. But the heart of political power lies in the middle. Those ‘just waiting to be touched and inspired.’

This characterisation of the ‘Swing Vote’ also aligns nicely with one of Hugh MacLeod’s central tenets made years ago about the importance of authentic heart and spirit in marketing: “The market for something to believe in is infinite.” Whether you’re selling policies or polymers, finding a way to ‘touch and inspire’ is the key to the majority of the market.

A fun poke at the Google breakdown…

My 70-20-10 blog was first inspired by a breakdown of prioritising sales strategy. Duncan Ferguson of 3 Connections has now applied the rule to selling yourself.

• 70 % – Neworking: “Connecting with people”
• 20 % – Recruiters: “Chasing recruiters”
• 10% – Research: “On your laptop”

Another way of expressing this breakdown in more conventional sales terms seems just a apropos to selling any product…

• 70 % – Customers: Spend time directly with your customers.
• 20 % – Channel: Spend time with your channel-to-market partners to set them up for success
• 10% – Research: Invest time in sharpening the saw and aligning your radar.

The 70-20-10 rule is now being applied to Social Media in general, but most pointedly at Twitter. While references come up regularly across the Internet, the genesis of it seems to be Angela Maiers’ “Twitter Engagement Formula”…

• Share Resources (70) – Successful learning in the 21st Century is not what you know, but what you can share, so 70 % of my Twittertime is spent sharing others voices, opinions, and tools.
• Collaborations (20) – 20% of my Tweets are directly responding, connecting, collaboration, and co-creating with like-minded Twitter colleagues. From these important tweets, lifelong professional and personal relationships have been forged.
• Chit-Chat (10) 10% of my Twittertalk is "chit-chat-how’s-your-hat" stuff. It is in these "trivial" details shared about working out, favorite movies, politics, and life in general that I connect with others as a human being. These simple chit chats are what have allowed me to know that I am never alone, and there is support whenever, wherever, and however I need it!

This breakdown was further distilled by WebMarCom…

• 70% of the time, listening and communicating
• 20% of the time, adding information
• 10% of the time, talk about you/your business

Or a slightly different twist by DFW Renaissance…

• 70% of your tweets share resources — blog postings, articles, opinions and tools
• 20% of your tweets engage in conversations and connections
• 10% of your tweets “chirp,” or chat about yourself, your life and your thoughts.

When I started dissecting these breakdowns for myself to figure out what they had in common and what they were really driving at, it seemed like a very simple directive…

• 70% – Give
• 20% – Exchange
• 10% – Take

In those brutally simple terms, the ‘Engagement Formula’ is not just good for Twitter or Social Media, but I would advocate it for life in general.

With the Christmas pudding well packed in and the New Years Resolutions looming, invariably considerations of exercise and diet will start most lists. To help well intended programmes on their way, I’ve found this application of the 70-20-10 break down applied to ‘Training Zones’ at Sweat Science…

• 70% of training is in the ‘Aerobic Zone’ (heart rate 80-90% of max, surges lasting 3-10 minutes)
• 20% of training is in the ‘Threshold Zone’
• 10% of training is in the ‘Maximum Zone’ (heart rate above 90% of max, surges lasting 30 seconds to 3 minutes)

A classic 70-20-10 model is ‘Professional Development’. This model was used heavily at Microsoft and is applied widely in business. It describes the breakdown of ‘how people learn’ in the professional environment…

• · 70% of learning is ‘On The Job’ (delivering on job commitments and special projects)
• · 20% of learning is ‘Through Others’ (mentoring and coaching from others)
• · 10% of learning is ‘Classroon’ (formal training and conferences)

As I investigated this application, I came upon a contrarian view debunking this delineation – http://www.nickjhowe.com/2010/05/lets-kill-a-few-learning-holy-cows/. But I think that Nick misses the point of 70-20-10 in general. It is not intended as some scientific measurement, assessment or recipe. Instead, it is merely an order of magnitude articulation of prioritisation. When Microsoft or other companies state that ‘learning comes in these proportions’, it is not necessarily claiming that the percentages derive from some scientific rule or formula. Rather, it is asserting the balance of investment and focus as it applies it as an organisation.

As stated in previous posts, one can quibble over the exact number, but that is not the point. The point is the relative scale and position of the priorities. The core message to this ‘Professional Development’ is ‘don’t just look to a bunch of training classes in order to learn.’ I think that is a very valuable message.

The development 70-20-10 is implicit in coursework in many higher education institutions and most certainly my alma mater, Harvard. I took the standard 4 course load. Each class met for lecture or tutorial about 2-3 hours per week for a total of 10 hours of classroom time. I certainly spent 7 times that in the ‘OJT’ stuff of reading, researching, and doing assignments.

What is key here is the ‘20%’ that is the clear #2 and curiously twice as important as the classes themselves. In fact, the focus and investment on the ‘Through Others’ educational dimension is one of the hallmarks of a Harvard education. It all started with the namesake of my own college house (see photo), President Abbott Lawrence Lowell. He reformed the structure of Harvard’s housing system into residential houses where students could live together and build community and interaction outside of the classroom. The centrepiece of each ‘House’ was the dining hall which has since served as the focus of social life, but also intellectual exchange. To this day, I remember as many insights, discoveries and ‘feedback’ over a dish of moussaka as my many classes and lectures.

Yoris Sebastian at CaturPW outlines a similar 70-20-10 breakdown to Google’s, but applied to personal living…

• “use 70 percent of your time to do on the thing that needed to fulfill your daily needs.”
• “another 20 percent of your time to do on fun things that you interested in.”
• the rest 10 percent of your time to do on else things beside the 70 and 20.”

Microsoft isn’t the only technology megalith which uses the 70-20-10 rule. Rival Google also uses it to describe the allocation of their investment in innovation. CNN Money explored the concept in its interview with CEO Eric Schmidt called ‘The 70 Percent Solution’ (thank Richard).

“Spend 70 percent of your time on the core business, 20 percent on related projects, and 10 percent on unrelated new businesses”

“Does Google have some kind of grand strategic plan for the new products it creates? Virtually everything new seems to come from the 20 percent of their time engineers here are expected to spend on side projects. They certainly don’t come out of the management team. ..What do you do with your 20 percent time? Well, 20 percent time applies to the technical staff. It does not apply to sales or management. Here’s how it works for management: We spend 70 percent of our time on core search and ads. We spend 20 percent on adjacent businesses, ones related to the core businesses in some interesting way. Examples of that would be Google News, Google Earth, and Google Local. And then 10 percent of our time should be on things that are truly new. An example there would be the Wi-Fi initiative–which I haven’t kept up with myself. God knows what they’ve done in the last week. I’ve been too busy on core search and ads. “

The article goes into good depth about how the rule is applied, measured, managed and even how it applies to the founders Larry and Sergey.

I was reminded about the fundamental importance of the natural resource of water reading this week’s BNET’s blog post ‘What Is The Point Of Government?’. In an attempt to strip away all of the posturing and promises and programmes and platform planks, Jo Owen wanted to get back to basics and ask what are the fundamental things that people want. She observes…

“To see what government is all about, it helps to see what happens when you don’t have a government. I’ve spent time with some with refugees from Somalia, which has not had a functioning government for 15 years. The number one thing they want from any government is the rule of law: if you cannot walk down the street safely, you become very grateful to any warlord, thug or religious militia to guarantee your safety (at a price). And without the rule of law, business is impossible: you cannot enforce contracts without goodwill or a Kalashnikov. Beyond the rule of law they want water, health and education. In that order. Try living without water for a week — see how long the rule of law lasts. Water counts. Health and education are relative luxuries.”

We in cosy London might think that water is the least of our problems. That it is primarily a problem of hot and dusty climates. Though the summer hosepipe bans after months of winter deluge provide some hint that managing water supply is not so simple even in an advanced country with relatively generous rainfall.

So if one accepts that water is a limited resource which, like many natural resources, is threatened by an increasing ravenous and exploitative human population, where does the problem lie. Michael Moore hasn’t done a film on water problems, but if he did, it would have been the award winning documentary Flow. The piece showcases a range of problems and systemic breakdowns around the world illustrating the very real and very painful affects when the spigots turn off.

Watching the film, I was struck by another instance of the 70-20-10 rule: water usage…

· 70% of water usage is Agricultural

· 20% of water usage is Industrial

· 10% of water usage is Domestic

The breakdown highlights the hypocrisy of measures like hosepipe bans and dribbling showers.

One of my earliest encounters with 70-20-10 came at my professional alma mater, Microsoft, whose Performance Rating system for ‘Contribution Rating’ (long term capability rather than just the recent year’s performance on the job) was based on a 70-20-10 bell curve of stack ranking…

· 70% – “Demonstrates potential at minimum to broaden in one’s role or to advance one career stage or level as a leader – either as a People Manager and/or individual contributor. Past performance suggests capability of delivering consistent and significant contributions over long-term. Competencies typically are at expected levels.”

· 20% – “Demonstrates potential to advance faster than average as a leader – either as a People Manager and/or individual contributor – preferably multiple levels or two career stages. Past performance suggests capability of delivering exceptional results over long-term. Competencies typically are at or above expected levels.”

· 10% – “Demonstrates limited potential to advance.”

In a bit more colourful terms, this general breakdown was paralleled by an HP executive, Antonio Rodriguez, who blogged on his own (slightly different distribution) ’20-20-60 rule’ which “outlines the mix of high achievers, laggards and muddlers in the middle at any large organisation.”

· ‘The Fat’ (60%) – “generally only good at producing and consuming meetings and at looking good in front of their bosses. They don’t take risks, but not because they are to limited (these are not Peter principle folks), but because they are optimizing for a different outcome: their own career advancement.”

· ‘A Players’ (20%) – “the real A players…They have the skills to get things done, the passion, and perhaps most importantly, the patience required to make elephants dance (big companies get stuff done). Every time I meet one of these gems, I walk away believing a little more in the human condition.”

· ‘Peter Principle’ (20%) – “operating above their skill/will level. These are the folks who make up the Peter Principle bucket— promoted beyond their abilities.”

Many debate the appropriateness of such ‘vitality curve’ classifications. In general, I applaud Microsoft’s culture and systems for being very strongly driven by objectives and outcomes. In a company that has traditionally had lots of rewards to give out, it has always tried diligently to create as much of a meritocracy as possible with processes to methodically and equitably measure out those rewards. A few years ago, the leadership even made a newsworthy and ambitious move to further reform the system based on employee feedback and assert less rigidity in following performance distribution curves.

My concern about the application of these ‘distributions’ is two fold. First, they are statistical constructs and most executives lack to numeracy to properly interpret and work with them. For example, while these distributions might generally apply over large numbers, no reasonable statistician would expect them to hold identically for smaller populations. In companies, sometimes these distributions are imposed on teams of just a handful of people. This imposition violates all sorts of statistical principles.

Also, one significant variable that such simplistic systems omit is the outcome of the group. A group that has achieved great things is likely to have different distribution of these categories than one that hasn’t. A world champion team might have more than ‘20%’ of its team as ‘All Star’ talent. In fact, the very fact of the skew to high performance could explain the overall team success. In another scenario, none of the team might be standouts (ie. no one at the 20% high achiever level), but the team work exceptional leading to a whole greater than the sum of the parts.

But more important than the clumsy application of such distributions is their application at all. These breakdowns are ‘descriptive’ stats, but misguided managers use them as ‘prescriptive’ rules. Misguided executives introduce policies which force managers to classify their people into such categories. The execs like the numbers because they are a nice, repeatable, McDonalds-like process which is easy to implement and understand on a superficial level. Unfortunately, it is often misapplied in specific instances. It is sort of like expecting a day with a ‘50% chance of rain’ to rain for half the day and be dry for half the day.

The managers defend the 70-20-10 system asserting one just has to ‘raise the bar’. That all performance is relative. If everyone has broken the world record in their heat, then only the top 3 get to go through anyway. In reality, business performance within an organisation is not so directly competitive nor finely measurable. Such a defence assumes a ‘purely’ competitive environment (ie. one’s performance is 100% independent of another’s), when in both reality and in preference, a large proportion of an individual’s time is spent supporting and collaborating with their ‘rival’ performer. Untangling the true relative performance here is a fool’s errand. As Mini-Microsoft described, "We still have a weird system that celebrates the individual devoid of the team. But now it’s not so much of a knife fight when you’re doing your best to defend your people."

While ‘70-20-10’ can be a useful benchmark against which to examine the distribution of performance assessments over large groups, it is inadvisable and misapplied maths to turn it into some sort of ‘rule’ by which to manage. One can look at large groups and even smaller groups and use it to flag questions, but then if there are good answers for the skew in distribution, then the matter of 70-20-10 should be dropped in favour of respecting a manager’s professional work as well as tailoring the performance review to the individual worker and their own individual context.