Legacy of John Jack - Part I

Memories of John Jack

CEOs and founders are often remembered for their vision and market-changing strategies. But rarely do we offer the award of household-name-familiarity with someone who is not the CEO. This set of blogposts is about a man who conceived an industry-changing product, managed the development of the technical infrastructure to support it, wrote the marketing brochures, persuaded the sales reps to sell it, designed the first applications with the clients, closed the early deals, and drove untold profits to his company for decades. All those things were done by a single person.

To sing the praises of someone who did that once is worthwhile, but John Jack did it several times.

This story is broken down into a series of blog posts for shorter, more topical reading. However, feel free to binge.

John Jack and Tim Houlihan in the Pisgah Forest

Legacy of John Jack - Part II

Some Historical Context for Non-Monetary Points

While John Jack was at BI WORLDWIDE[1], there were plenty of products he developed, but the big two were AwardperQs® and GoalQuest®. For fame-seeking product developers and product marketers, John's story contains many replicable parts and deserves a full airing. But truth be known, nothing can replicate John Jack.

Early Inspiration

John was a dreamer.

John was inspired by a desire he had as a child to acquire something he couldn't purchase for himself: a spy decoder ring from a cereal box. The rules on the back of the box were simple: save up enough cereal box tops and have the ring.

The decoder ring enchanted him. It engaged his motivation so much that he coerced his mother into buying that cereal several weeks in a row. This was all so that John could voraciously tear through the box tops until he met the required minimum.

"Did you like the cereal?" I asked him. "I don't remember. I'm not even sure if I ate it. That wasn't the point. The point was the decoder ring needed box tops, and everything else was just noise," he said.

Once he had the box tops – the media or currency as we might call it – he stuffed them into an envelope with the redemption form and waited impatiently for days. Interestingly enough, the incremental sales of cereal effectively paid for the decoder ring one household at a time. John saw this as foundational: "The reward was paid for by someone other than the recipient and the box tops had no explicit value," It was an anecdote he frequently shared.

Years later, John would mimic the cereal box model to generate motivation in sales reps:

1.     Make sure the prizes were indulgences without an explicit dollar value.

2.     Sell the points to the clients as the points were issued, not when they were redeemed.

Career Work

John was a seller.

A notable period in his career was as a sales rep for the Hamilton Watch Company in the 1960s. There he acquired first-hand knowledge of the power of contests and non-monetary awards (awards where the value was not explicit). He was frequently one of the top salespeople and the recipient of extravagant trips and tons of high-end merchandise for him and his family.

(“Tons” is not an exaggeration. “One Christmas,” he told me, “we bought all of the kids’ presents from the points I’d accumulated. I never would have bought some of that stuff with my own money, but hey, they were just points!”) 

After going to work for Maritz Corporation[2] in the 1970s, John witnessed the incentive industry beginning to devolve as buyers of point programs wanted better deals on the briefcases and trips they were buying. He concluded that the best way to improve profits and to grow revenue was to change the game. As a sales rep at Maritz, he was not responsible for developing new products, so he took the next best route: sell programs that specified rules and rewards to John’s liking. Then let his coworkers figure out how to deliver them. (This would become one of his specialties.)

In the early-1990's, John was in a position to actually develop new products. The incentive industry was loping along in the footprints of Elton MacDonald. He is often credited with creating the incentive industry by convincing a sales manager at National Cash Register to reward his reps with prizes from MacDonald's dry goods store in Dayton, Ohio. That was nearly 100 years earlier, and little had changed.

Above all, MacDonald’s model was simple and effective, and it appealed to John.  John saw the brilliance in MacDonald’s concept that latent motivation could be unlocked in sales reps when the prizes contained three inherent qualities:

1.     The reward needed to elicit emotional desire in the reps.

2.     The reward needed to be so important that reps would focus on it

3.     The reward needed to be something the reps wanted but wouldn't buy for themselves 

The properties were in awards all along, but it took John Jack to reveal them with a new light in his work at BI WORLDWIDE (BIW).

[1]: https://www.biworldwide.com/.

[2] Maritz: https://www.maritz.com/

Legacy of John Jack - Part III

Patenting a Non-Monetary Point System

John was an inventor.

When John Jack left Maritz for BIW in the late 1970s, point systems had the same two features: first, monetary values were explicit (1 point equaled 1 dollar, for instance) and, second, all points were paid for at the time the reps redeemed them for prizes. He muddled through it for years, but was increasingly frustrated by the way incentive buyers treated the programs and how ineffective the programs had become.

By the early 1990’s, John reimagined the way his decoder ring experience might play out in the world of corporate sales incentives.

Over a half-dozen years, he tested several iterations that were mildly successful before he hit on a combination that stormed the market. Undeterred by the failures, John frequently reminded me, "Edison tested 10,000 filaments before coming up with the right combination of cotton and chemicals to make the light bulb last more than an hour." To create four of five products that weren't terribly successful was nothing in his mind.

AwardperQs were different from every other point system at the time. The company purchased the points for $25.00 each, but they could be redeemed for rewards that would be worth somewhere between $15.00 and $30.00. This variability served to take the reps' focus away from "is this a good deal" and put it on, "what is it that I want to get with my points?"

Of course, $25.00/point doesn’t work for every company in every situation so $2.50 and $0.25 versions were introduced to accommodate a greater variety of corporate budgets and circumstances.

Shortly after AwardperQs were introduced, John sought patent protection from the United States Commerce Department and got it. His invention, the combination of points that intentionally disguised the monetary value of the award, were pre-paid, and could be accumulated indefinitely by the recipients, met the Patent Office’s requirements of novelty, non-obviousness, and inherency. A trademark for a new product was common, but John made waves in the industry by receiving a rare patent[1] for an incentive reward system.

Over the nearly 20 years of the product’s lifespan, hundreds of millions of dollars of AwardperQs were issued and redeemed by millions of recipients in more than 40 countries. That’s a successful innovation.

Other Products

John was insatiable.

He favored the approach used by automobile manufacturers in the 1950s when it came to new products and marketing. Every year, the Chevrolet Coupe was redesigned with new features making last year's model slightly less desirable. John often challenged me when we talked about annual strategies: "Who wants to be driving a Chevy with last-year's fins when this year's fins are bigger and better?"

So, every year, new products or new enhancements were created – no matter what. I don’t remember the names of all the products John created, but I can assure you that every year brought something new to the market.

There are a few that stand out: Summit Collection™, Mileage Money™, Gainshare™, Q-bid®, AwardperQs® Gold and AwardperQs® Silver…there were certainly many more. Each one had great marketing materials, an excellent concept, and of course, clients. Every one of John's products had a client. And he always strived to have more.

It's interesting that more marketers aren't more focused on a regular program of enhancements and new products. Tech firms that build physical products are good at regular updates – less so today than they were 20 years ago – but software changes are rarely marked by radical changes in user experience. Instead, developers lean toward micro-improvements that are sometimes invisible to the user. Amazon has made 20,000 improvements to their website in the past 12 months, but customers would be hard-pressed to identify a single change.

John wanted to make sure the changes were vivid. By defining enhancements and new products vividly, John believed they'd be more meaningful. He was right. In the days of printed catalogs, he once scolded the art director and merchandise director, "We can't just bump up the catalog from 1,000 to 1,100 items. We need to go to 5,000 items! Now how do we do THAT?"

[1] USPTO Patent # US7249051B1: https://patents.google.com/patent/US7249051

Legacy of John Jack - Part IV

On Goodyear and AwardperQs®

John was an opportunist.

In 1995, a BIW sales rep calling on Goodyear told John Jack that his contact, Tom Gravalos, wanted to run a formalized study on awards using his dealers. Tom had two reasons: first, he needed data for his MBA thesis and second, he wanted to persuade his bosses that it was time for a different approach. John was – as always – ready.

The two of them quickly designed a simple scheme of stack-ranking the Goodyear Tire stores in order of sales, then splitting them – alternatively – into two groups: the reps in one group would earn $25.00 for every Aquatred tire they sold. The reps in the other group would earn the equivalent of $100.00 in AwardperQs for every set of 4 Aquatred tires they sold.

The 90-day program results were clear and persuasive: the AwardperQs group sold more tires than the cash group by a long shot. Goodyear became a long-term client of BIW's, Tom earned high marks for his thesis, and John wrote an industry-changing paper he called "The Trouble with Money."

“I knew the outcome before we got started,” he said. “Those guys selling tires never got to treat themselves to something really great.” John was not relying on hindsight bias in this case: he was dead right. He knew how the reps would perform with non-monetary rewards and that’s just what happened. 

Duke University professor Dan Ariely, PhD[1] was familiar with “The Trouble with Money,” when Dan and I first met in 2007.  Dan is the author of several New York Times bestsellers and was surprised the incentive industry had not done more of what John did with Goodyear.

In an interview with Inc. Magazine in 2013, Dan praised Tom and John’s approach by noting, “Their plan was simple and elegant." Dan went on to describe how the paper used field research to confirm what he had already found in the laboratory: "It turned out that the tangible-reward group increased sales by 46% more than the monetary-reward group. One explanation is that we can visualize tangible rewards which creates an emotional response. Money, on the other hand, is not accompanied by images as often and lacks the emotional pull that tangible rewards have, so [it’s] less effective in motivating employees[2].”

[1] Dan Ariely, PhD: https://en.wikipedia.org/wiki/Dan_Ariely 

[2] Ariely on the Goodyear Study from Inc. March 2013: https://www.inc.com/thebuildnetwork/the-incentives-that-motivate-best.html

Legacy of John Jack - Part V

On Goal Setting

John was a goal setter.

John Jack's fascination with goal setting began with his personal experiences of setting and achieving remarkably challenging goals. It's easy to imagine that a high-performer would attribute goal setting only to other high-performers. But that wasn't the case for John. He saw goals as the universal ticket for all salespeople to become superstars – in relative terms.

Most sales contests in the 1990's only rewarded top-performing reps. However, John saw untapped potential in those who gave up as soon as they saw the contest rules. He combined that with the observation that too many reps don't have SMART (Specific, Measurable, Attainable, Relevant and Time-Sensitive) goals in their weekly or monthly vocabulary.

He noted, “You can manage to goals, but you can’t help people get where they want to go if they don’t have a destination.” Personally selected goals, rather than shooting for a quota, allowed more reps to become successful reps.

He first tested goal setting with The Marathon System while he was at Maritz. But by 2000, John wanted to combine personally selected goals (personal commitment) with risk (loss aversion) and generous rewards (to stimulate high levels of emotion and motivation). 

About the same time as John discovered the Cab Drivers study, he found a paper by Ed Locke and Gary Latham[1] on how participation in goal creation positively impacted results. John’s fascination with goals had stretched across his personal and professional life for years and he wanted to create a tool that would enable reps to be rewarded for exceeding their regular run rates.

As it was with other products, several unsuccessful iterations were conceived, developed and deployed before a model for GoalQuest® was brought to market in 2001. John connected the academic principle that goals are more effective when they are self-selected with a real-world means of addressing the risk inherent in striving to achieve the goal.

GoalQuest relies on a simple concept: perceived achievability on the part of the rep. This happens because historical data on the rep’s performance is used to predict a future run rate (baseline), absent of any incentive. Then three levels of higher-than-baseline performance are established with corresponding rewards. The rewards ramp up exponentially, so the lowest level of performance garners a 1X reward, the second level of effort is a 3X reward and the third (highest) level of effort is a 6X reward.

The exponential rewards are combined with a commitment device: the rep must choose their target level of performance (their goal). Failing to reach their goal results in no award – not even a diminished reward. The chosen goal is all-or-nothing, creating a potential loss if the goal is not achieved. Nor is over-goal achievement rewarded with a higher larger reward. Loss aversion is combined with a commitment to render this methodology a highly effective tool to drive motivation among a very high percentage of the sales force.

Typically, close to 50% of all reps exceed their baseline and roughly 30% achieve – that’s a larger percentage than almost any contest and that performance is spread across the entire sales organization. That spread equates to tremendous incremental gains for the sponsor. It’s a remarkable incentive and is highlighted in a peer-reviewed paper published by Raghuram Bommaraju, PhD[2].

The result was GoalQuest was trademarked in the United States, the EU and Australia, but was thoroughly unique in how it combines self-selection with non-monetary rewards.

GoalQuest was a tough sell at first, but then came General Motors with the largest GoalQuest ever.

GM’s use of GoalQuest created a radiance for the product and propelled BIW sales reps to promote it incessantly. The result was that before John retired, GoalQuest amassed more than $100 million in revenues and it’s still being used successfully today.

After a 7-year exchange with the US Department of Commerce, John’s GoalQuest was awarded patent[3] protection.  (The seven-year battle for a patent is as long and boring as one might guess, so we’ll skip it.

[1] Locke, E.A., & Latham, G.P.  (1985). The application of goal setting to sports.  Journal of Sports Psychology, 7, 205-222. https://psycnet.apa.org/record/1986-23150-001

[2] Raghuram Bommaraju and Sebastian Hoenberg, “Self-Selected Sales Incentives: Evidence of their Effectiveness, Persistence, Durability, and Underlying Mechanisms” Journal of Marketing, September 2018, vol 82. 

[3] USPTO # WO2001013306A2: https://patents.google.com/patent/WO2001013306A2/en?q=goal;&inventor=%22john+m.+jack%22&oq=goal;+%22john+m.+jack%22

Legacy of John Jack - Part VI

Academic Interests

John was a learner.

In this blog post/part of the John Jack memories, there are two distinct and unrelated stories connected to John’s fascination with learning.

Ed Locke, PhD and Gary Latham, PhD – The Founders of Goal Setting Theory

After the success of the GM GoalQuest was in our rear-view mirror, John and I asked Ed Locke, PhD[1] to speak with us about the remarkably successful incentive schemed John had created. Locke and his partner, Gary Latham, PhD[2] are recognized around the world as the founders of goal-setting theory. Before Locke and Latham, goal setting theory didn't exist. We were pumped to share this great idea with the guy whose noggin created the thing we were benefitting from. 

We set a time early one morning to speak with Ed from his home in Maryland. John and I huddled around the speakerphone at my desk. After some niceties and an explanation of GoalQuest, John casually mentioned, “And you know, Ed, General Motors used GoalQuest to sell an extra hundred thousand cars in 45 days last year. It’s pretty powerful.”

“Sounds like a good piece-work tool. Have you tried it with cash?” Locke asked unphased by our report on the scope of the impact of the incentive.

John and I were gobsmacked. Without saying a word, we both knew that Locke didn’t get it. So John jumped back in to try to save the day.

“What we’re really focused on, Ed, is that these dealers had to select their own goal based on their individual run rate. And the rewards were all-or-nothing…”

“Yeah, I got it,” Locke interrupted without affect. “So what else are you working on? 

After the call ended, John and I slunk low in our chairs. We gave it a shot and got nothing back.

On April 15, 2020, I had the chance to speak with Gary Latham, PhD – the co-founder of goal-setting theory. I couldn't pass up the chance to run two things by him: GoalQuest and Ed Locke's comments.

Gary was astounded by the cleverness of GoalQuest as a rule and reward structure. He praised John for such a fine invention and said, “I would have never matched up the exponential rewards with the all-or-nothing levels. Well done!” As for his partner’s abrasive comments, Gary said, “Yeah…Ed can be a character sometimes.”

After I finished with Gary, I rushed to call John to share the feedback. John took the good news in stride, but I hear an uplift in his voice when he said, “Well, at least somebody got it!”

George Loewenstein, PhD

George Loewenstein, PhD[3] is one of the highest-regarded researchers in the field of behavioral science.  His work, which spans a curriculum vitae of almost 40 pages, is foundational in the work of psychology and economics alike.

In my first meeting with George in his dusty office at Carnegie Mellon University in the Fall of 2010, I shared the data that was being amassed with GoalQuest. At that point, nearly 1,000,000 participants in 40+ countries had been through the GoalQuest model. As I spoke about the rules and rewards in GoalQuest, George's face softened. (He'd feared I would ask him to be a pitchman for BIW. That wasn't the case.)

“This is fascinating,” George said. He realized that this was special. “Tell me more about this model,” he inquired and didn’t stop asking for almost 20 minutes.

Because of the way the GoalQuest website (for users) was laid out, George created a survey about confidence and risk within goal setting. His work is yet to be published; however, more than 10,000 men and women in more than 20 countries provided data that will help provide a better understanding of the way we treat risk when we're setting goals. 

John’s work lives on.

[1] Edwin Locke, PhD: https://en.wikipedia.org/wiki/Edwin_Locke 

[2] Gary Latham, PhD: https://www.rotman.utoronto.ca/FacultyAndResearch/Faculty/FacultyBios/Latham 

[3] George Loewenstein, PhD: https://en.wikipedia.org/wiki/George_Loewenstein

Legacy of John Jack - Part VII

Not Working, But Working

John liked to play.

John Jack believed that all work and no play made Johnny a dull boy. He and I once ventured to the University of St. Thomas to see one of the world's leading paleoanthropologists, Meave Leakey, PhD[1], lecture on the origins of the human species. The place was packed, and we stood out as a couple of very old guys in a hall of college students.

Dr. Leakey laid out her theory in this order: 1. Bipedalization: human ancestors learned to stand erect and to get around on our hind legs. 2. Manual Dexterity: our ancestors figured out how to maximize the use of our hands now that they weren’t being used for walking around.  3. Encephalization. human brains developed to manage the changing environment and the use of front limbs that were becoming different from our rear limbs.

John and I left Dr. Leakey’s lecture in awe, never to forget the three cornerstones of how our ancestors evolved, and talked about them for years to come. Literally. At lunch on a random day, John might finish a bite of his Cobb salad and say, “If it wasn’t for bipedalization, we would have never gotten to the manual dexterity I needed to hold this fork!”

* * * * * 

And on warm and windy afternoons, we’d venture out to John’s house, push the catboat away from the dock and continue our conversation on Lake Minnetonka.  If there was no wind, there was no sailing as the catboat had no motor – intentionally to keep the focus on sailing and not on cruising. There were other boats for that.

Sailing the catboat captured John’s love of the water and his love for being tested. Barely 23’ long, the catboat is design favored by fishermen in the Massachusetts Bay area. The name, as John shared with me (and at first I didn’t believe him), came from the way the boats attracted cats at the docks when the hold was full of fish. So, the sailors referred to them as catboats in honor of their high desirability among the felines.

A catboat bears a wide beam and deep hold for hauling in the daily catch and, more importantly, it was driven by a tiller.  The cat-rigged (or gaff) sail could fly more than 350 square feet of sail area and really push the little boat hard. That meant that even in small winds, you had to hold on to the tiller for dear life – which was exactly the point John loved to make. “This is how you sail, Boy!” his voice reeked with a bad pirate accent.

Always a fan of the non-obvious, John loved the boat’s history, it’s connection to the Colonial coast, it’s rigorous sailing technology, and its name.

[1] Meave Leaky. PhD: https://en.wikipedia.org/wiki/Meave_Leakey

Legacy of John Jack - Part VIII

Love of Writing & Comedy

John liked to laugh.

John Jack is the author of more than just a few papers[1] and a book[2]. He also created the promotional copy for hundreds of products and services he created, tested and brought to market. Each one of them had a case study and narrative to complement the features and benefits of the offering. His heroes included both Mark Twain and David Ogilvy. Like them, John was a natural writer.

In Sales Management Magic, he cleverly and succinctly wrote, “While it’s true that salespeople are seldom satisfied with the money they make, it’s also true that a great many of them underutilize their ability to earn more. Put another way, they leave money on the table. I’ve always wondered why.”

The comedic approach was central to JJ’s belief that you could get more done with honey than with a whip. He often cited The Adventures of Tom Sawyer for the way Tom induced unwitting playmates into helping him whitewash the fence around his house. It was more than simply making it appealing, “Tom made it an emotionally rewarding experience,” John would often crow.

After workday lunches which were almost always at Bunny’s, we’d return to the parking lot at the office in John’s 5-series BMW wagon (or one of his other charming vehicles), and we’d listen to a CD of Stan Freberg’s[3] best radio shows from the 1950s and 1960s. We'd laugh and laugh for 30 minutes or so in the office lot. And for months, we returned to great lines like, "I asked a simple question and got a pageant!" 

We also talked about industry trends and the people at competing incentive companies who created their products. John cared little for their creations and quickly surmised, “He couldn’t tell an incentive from a can of corn.”

Occasionally, he adopted a professorial tone to remind me that, “Striving for mediocrity is much more gratifying than striving for excellence. You’re much more likely to reach your goal.”

He loved Skyline chili (“Skillinee’s!") and beer. Once at a business lunch in St. Louis with a few Anheuser-Bush executives, the client encouraged us to order a beer. John ordered a Guinness. The surprised client asked why didn't order a Budweiser and John replied, "Because I like Guinness better." (Didn't get the account.)

[1] “The Trouble With Money,” Tom K. Gravalos and John M. Jack. BI Performance Services, Minneapolis, MN. ©1995. 

[2] Sales Management Magic, John M. Jack, Schoenecker’s, Inc. ©2007.

[3] Stan Freburg: https://en.wikipedia.org/wiki/Stan_Freberg

Legacy of John Jack - Part IX

My Tutelage

John was a teacher.

By the time I met John Jack, he was already a legend at BI WORLDWIDE and the incentive industry. In many ways, I was late to the game. John was in his ‘60’s and he had a long line of devotees. But it didn’t matter to either of us – there was work to do.

In early 2001 when I joined the department, John and I would both arrive at the office around 7:00am and do our own thing until about 7:45 or 8:00am. Then we would convene to his office and discuss presentations scheduled for the week, calls from sales reps that had come in and what were the sales reps' issues or how we could speed up the development of the next release for one of the products…

That discussion would last until lunchtime – somewhere between 11:30am and Noon – and we’d get into his 5-series BMW wagon and head to Bunny’s. We never waited for a seat because the service and the food were incredibly mediocre. And he loved it. “See, it’s Friday and we can sit down to a table without waiting and order the same crappy food we had yesterday!”

Our conversation would continue through lunch and back to the office. Half the time, we went on to other meetings, but the other half we blew through a few more hours in John’s office working through ideas for presentations and products, researching academic findings, or just looking through magazines for great examples of great advertisements. 

And as much as I was cognitively aware that I was just another person in a long line of acolytes, my nose was rubbed into it when my colleagues would pull me aside and ask, “So you’re working with John. What’s he up to? What’s next?”

My colleagues never even considered that I might have contributed to something that John was working on – and that was fair. I was the apprentice, not a peer. Yet in that, he never made me feel subordinate. He always propped up my stature with questions like, “What do you think would be a good way to supercharge the AwardperQs engine?”

Later

A few years after John retired, a colleague from BIW came to me with a large book in his hands. “John let me borrow this a dozen years ago so I could brush up on motivation.” It was McClelland’s 692-page tome[1] on motivation. “I was moving my desk and realized I still had it. Can you get it back to him for me?”

I found inside hundreds of notes in John's handwriting and highlighted insights from the 1973 masterwork on motivation that informed John of some of the best ideas for products anyone could imagine. John had read the vast majority of the book and integrated it into his business like no one else I’d ever known.

[1] Human Motivation, David C. McClelland, Cambridge University Press, 1972. https://www.cambridge.org/core/books/human-motivation/FE109A014F97354399BAF0E3602D593D

Legacy of John Jack - Part X

Additional Thoughts

There's no simple summation for John Jack's life. There are themes beyond his career that stand out, but there are too many to list in all honesty. And frankly, he was way more complex than he ever wanted to be recognized for.

That said, there are a few leitmotifs that I was aware of that are worth noting and they include: He worshipped Suze and his children (and grandchildren), loved his family in the largest sense of the word, loved every animal that came into the house, hated (I mean that in the most robust definition of “hate”) recognition of his accomplishments, took great care of his direct reports, was deeply loyal to his company, and had a temper that would scare a grizzly bear away from roast beef when he was suitably pissed off.      

Because memory is an unreliable partner, and because I am aware of so much more to say about John (even at this writing), I can’t bring myself to use the words “final thoughts” in a meaningful way. These may be the last words I write about him, but I am not sure. Plus, what I’ve written is certainly not definitive. Others should build around and on top of these words and make corrections and additions as they see fit. I merely endeavor to bring a great man’s legacy a little more light.

Things end, though, and so must this. John’s life ended with a finality that feels like a sharp stick in my side. I miss him terribly and hope you might miss him, too.

If there were one thing that your acquaintance with John M. Jack should bear with you, it’s this: Don’t quit.