Outside the Lines

Legendary rocker Neil Young made a special appearance during Salesforce.com's Dreamforce conference keynote address. He didn't mention cloud computing, but talked about his 1959 Mark IV Lincoln Continental.

Neil Young and Marc Benioff

(Credit: Stephen Shankland/CNET News)

Young has spent more than $100,000 to green his 5,000-pound "Thinkin' Lincoln" former gas hog. "It's a piece of America art," said Young, who is an avid car collector. He hopes to get the equivalent of 100 miles per gallon and take the $10 million Progressive Insurance Automotive X Prize. "We are over halfway there (to 100 mph) with this car," he said.

"We took Ford, GM, and Chrysler and instead of having them in one building, we have it on the Internet. We are always getting input from our huge virtual shop," Young said.

Young has focused his green car efforts on the electric grid, which he said can support 180 million vehicles and compressed natural gas. Young is working with Johnathan Goodwin, who has expertise in turning big cars into green cars. The car can run on electricity for short runs and on compressed natural gas for longer trips. A generator recharges the battery when it is using alternative fuels.

The engine is a 150-kilowatt electric motor that produces the equivalent of 500 horsepower. The car cruises at 80 mph and can reach speeds of 160 mph, Goodwin said. "It's essentially like a train. We use one motor to push it down the road, with a range of 80 to 100 miles." A generator, that produces 75 kilowatts, comes on automatically to power a rotary engine that runs on compressed natural gas and refuels the batteries.

"We want to eliminate roadside refueling and take distribution out of the loop," Young said. The energy generated by the car could be used to power several houses or power tools from a car, he added. Information is available at the LincVolt Web site.

The LincVolt 1959 Lincoln Continental

(Credit: Stephen Shankland/CNET News)

Check out the video from The Wichita Eagle, featuring Goodwin, who developed the hybrid technology and Neil Young.

See also: Neil Young on gas guzzlers: Long may you run

SAN FRANCISCO--After a decade as the chief evangelist in the wilderness of software as a service, which has morphed into cloud computing, Salesforce.com founder and CEO Marc Benioff is having a more challenging time coming up with groundbreaking industry disruptions. But that isn't stopping him from enthusiastically preaching the cloud computing gospel.

Benioff and company have built a $1 billion business and gradually expanded a CRM application, run like Google runs search in the cloud, into a platform that greatly reduces the friction involved in business software development and delivery. With Microsoft recently entering the cloud-computing platform arena with Azure and practically every vendor staking a claim to the cloud, Benioff's vision has been legitimized and turned into the next big thing. But that just makes Benioff try harder. Salesforce.com is no longer the underdog, but Benioff is relentlessly touting his "no software" theme and irreverently characterizing Microsoft, SAP, and Oracle as dinosaurs.

Salesforce.com CEO Marc Benioff

(Credit: Dan Farber)

At the Dreamforce annual customer conference here Monday morning, before a crowd of 10,000 adherents, a supercharged Benioff came out on stage, seeking to maintain his crown as the Pied Piper of cloud-based business software. "There has never been a better time for cloud computing and for Salesforce.com," he said. He was likely referring to the troubled economy, which makes cloud-based software services an attractive alternative to traditional software business models.

The news of the day is an evolution of the Force.com, the company's development platform for building and running business applications in the cloud. Force.com sites will allow customers to run their Web applications on Force.com, and takes care of the domain, URL, and RSS management. In effect, the new service further consolidates Salesforce.com's hold on a company's data and public Web presence. The company also announced Force.com for Amazon Web Services, which allows applications to be built between the Amazon and Force.com clouds.

In addition, the company announced Force.com for Facebook, which allows developers to use the Facebook APIs within Force.com applications and tap into Facebook social graph data via the Facebook Platform and Facebook Connect. The combination will lead to social CRM and social sales, Benioff said. "Facebook has over 300,000 pages run by businesses," said Facebook COO Sheryl Sandberg during the Dreamforce keynote. "By coming together with Force.com we are about to unleash enterprise apps on our network," she said.

Steve Fisher, senior vice president of the Salesforce.com platform, showed a Force.com recruiting application running within Facebook. The connection with Salesforce.com could also be another source of revenue for Facebook, beyond advertising.

Cloud computing is becoming mainstream and Benioff is trying to ensure that he is upstream from the competition. He may not remain in that position, but he will continue to push the industry a whole deeper into the cloud.

This week Microsoft gave evidence that it will continue to be a major force for at least the next decade. The company outlined its products and strategies that more fully embrace the "cloud," such as the Azure set of cloud services; Web-based, lighter-weight versions of Microsoft Office applications; and the latest iteration of the Live Mesh middleware. Google may have won the search war, but Microsoft isn't about to cede the global cloud to the search engine giant.

Ray Ozzie explains Azure to CNET News correspondent Ina Fried.

As in past epochs in its 33-year history, Microsoft ties its success to the developer community, having an army of loyal, or at least well or modestly compensated, software warriors. The Microsoft mantra is: "Build a platform and an ecosystem of developers, partners, fans, and people willing to spend their money will follow." A compelling platform and the potential to reach a large audience of buyers, which Microsoft can deliver, attract the developers, who build the applications and services that attract consumers and business users.

Microsoft also now understands that its platform must span every kind of device--PC, notebook, smartphone, car, home, etc.--and offline scenarios. Microsoft missed the Web search revolution, but it's not going to miss out on the much bigger revolution--the move to the cloud over the next two decades.

Google is building a competing ecosystem from the ground up with similar characteristics and a desire to attract millions of developers. Amazon is pushing its elastic computer cloud, and Rackspace, EMC, IBM, and many other companies are trying to get a piece of the action. Most the cloud companies are focused on hosting services, but the biggest piece will be platforms-as-a-service with developers creating and running their applications for on a cloud operating system.

An early example of this trend is Salesforce.com's proprietary Force.com platform. Sun Microsystems, the company that coined the phrase "The network is the computer," has all the pieces to construct a planetary cloud but seems to be missing from the discussion. As my friend Steve Gillmor notes, Sun is on the ropes.

Openness is a major issue as the global cloud materializes. Businesses don't want to be locked into a particular cloud, and also want various clouds and services to interoperate via standards. Speaking at the Professional Developers Conference last week, Microsoft's chief software architect Ray Ozzie said that the foundation level in the operating system cloud would run in Microsoft's data center, but SQL services, .NET, and Live services can be mixed and matched by developers inside and outside of the company's datacenters. The Azure cloud is also cross-platform, but the various clouds will extract a toll and by nature it won't be dead simple to move applications using foundation services from one cloud to another.

Microsoft's cloud computing efforts have gotten off to a slow start compared with competitors, and it's on the scale of a Manhattan Project for Windows. Azure is in pre-beta and who knows how it will turn out or whether consumers and companies will adopt it with enough volume to keep Microsoft's business model and market share intact. But there is no turning back and Microsoft has finally legitimized Office in the cloud.

Ray Ozzie has a track record of slowly but surely getting things done and Microsoft is famously persistent and cash rich. But building a platform, or Internet operating system, at planetary scale supporting billions of users and trillions of transactions per day, and having fleet Google as a primary competitor will be a major test of Microsoft's brain trust and resolve. Don't be surprised to find a recharged Bill Gates parachuting into the fray as Azure evolves and the cloud war for developers escalates.

See also:

Scoble: Never underestimate Microsoft's ability to turn a corner

Wilcox: How Can You Be So Sure about Azure?

For the last few years AdaptiveBlue has offered a semantically rich Web application that understands things such as books, movies, and music. Clicking on text, such as a company or movie name, brings up a context-sensitive menu of related links. The company is taking its technology a step further, adding a social dimension and renaming the product, "Glue." Along with Radar Networks' Twine and Powerset's Wikipedia search engine (acquired by Microsoft), Glue offers a compelling glimpse into how the semantic Web will add a new, powerful level of intelligence to the Internet.

Rather than just connect things to related data and services, it also connects things to people and people to people and their things. For example, when a Glue user visits a site with things the software recognizes, such as a movie, artist, wine book, restaurant, or stock quote, a bar appears at the top of the screen with a list of friends and other people in the Glue network who looked at that object. Users can leave brief comments to share an opinion with others.

Glue allows users in its social network to discover what friends share interests with them without going to a central site.

"Glue works as a contextual filter," said Alex Iskold, founder and CEO of AdaptiveBlue. "We show relevant information from friends about the things they visit. They don't have to sift through lengthy lifestreams. For example, if you have 100 friends in FriendFeed, you are a human filter trying to sift through it and the information is completely out of context. The idea is to get the useful information 'chunked' contextually on the pages you visit. We are not asking people to change their habits."

The people surfaced in the Glue bar could have seen the object, such as a movie title, on a variety of sites. "People look at movies at different times and places, but the core semantic technology can understand the same thing and correlate it. As a movie fan, you just want to know what your friends think. It doesn't matter when or where the user visits things; Glue automatically connects them. There is no Glue destination site--the network is the user's context across the Web," Iskold said.

Glue allows users to add comments and indicate a "like" or favorite.

Glue also taps into existing social networks, such as Facebook and Twitter, to add friends, or to "follow" other people. The Glue Navigator allows users to browse the network of people and things, and what friends have identified as a "like" and what they have to say about objects. Glue can display all the music that a friend has viewed and drill down, offering contextual shortcuts to find out more, such as reviews and shopping links, about things on the Web. Glue remembers only the last 20 last things visited, and the things "liked" or commented upon.

Each user has a profile page that shows likes and the number of followers and who the user is following. "It's a way of cross-pollinating interests. You can see what I am interested in and perhaps it is the same books or wine with which you have an interest," Iskold said. "Glue also allows you to claim pages that represent you, such as a blog, FriendFeed, or Twitter. It's an outlet where people know where to find and connect with you. For example, other Glue users could see what you are up to recently on your personal blog."

Glue impressed investors at RRE Ventures and Union Square Ventures (Series A Lead) enough to fund a $4.5 million series B round recently. The company has a good chance of making it through the meltdown.

On Tuesday, October 28, I will be participating in a roundtable discussion on the state of online video pulled together by Beet.TV impresario Andy Plesser, with executives from AOL, MySpace, Yahoo, MSNBC, CNN, Microsoft, Akamai, The Washington Post, Dow Jones and several other companies. Tune into the live Webcast at 9:00 AM EST.

In this week's EIC Squared podcast, ZDNet's Larry Dignan and I discuss the flailing economy. The CFOs explaining the financial results on tech company earnings calls echoed the sentiments and uncertainty of every other company and industry. As Microsoft CFO Chris Liddell stated:

We're not economic forecasters, and there is a high degree of uncertainty in outlook based on the state of the economy. As a result we've adjusted our guidance approach as follows. At the top end we're assuming a mild recession, and a relatively modest growth rate for all IT-based products. While at the bottom end we're assuming a deeper recession in the economy and end-season lower growth for IT.

Even Apple's Steve Jobs had something to say about the economy: "Your next-door neighbor can likely predict what is going to happen as accurately as we can."

We also preview what's coming next week at the Microsoft Professional Developers Conference in Los Angeles next week.

Amazon founder and CEO Jeff Bezos loves to talk about the Kindle e-book reader. He's even got media mogul Oprah Winfrey pitching the device: "I'm telling you, it is absolutely my new favorite thing in the world," she recently said.

Every time I go to Amazon I am greeted with a huge Kindle ad that takes up most of the screen space. Amazon's computers know that I have seen this ad hundreds of times but they persist in showing it to me instead of products that are based on my viewing and purchase history and would have a higher probability of getting me to spend money.

At the same time, Amazon refuses to talk about the number of Kindles sold, but willingly discloses that the wireless device provides instant access to more than 185,000 books, blogs, newspapers, and magazines.

Apple, on the other hand, is happy to let the world know that 6.9 million iPhones and 11 million iPods were sold in the last quarter, and the iTunes catalog has 8.5 million titles.

One can only presume that Bezos worries that the sales numbers are not sufficiently stellar to share with the world. Disclosure of what could be perceived as lackluster Kindle or e-book sales would heap a lot of negativity on the fledgling device on Amazon, which pulled in $4.26 billion in its last quarter.

For Bezos, the Kindle is a second revolution. He started Amazon more than a decade ago as an online bookstore, and gradually added other product lines. As iTunes and Netflix took off, Bezos moved into digital music and movie delivery, and with the Kindle he is laying the groundwork to empty Amazon's warehouses of physical books.

During the Q3 earnings call, Bezos downplayed any cannibalization of print book sales by the Kindle: "Kindle's effect is additive to physical book units. Post the purchase of a Kindle, owners buy 1.6 times as many book titles and the same amount of physical books."

Reading his statement, it's apparent that Kindle buyers are already book lovers, and haven't yet weaned themselves off of print. But Bezos is very patient, and clearly willing to invest long term in his Google-like vision--digitize the world's information and sell it through Amazon.

Perhaps with Oprah's help and a new and improved version due next year, the Kindle will achieve escape velocity and Amazon can stop showing me the annoying Kindle ad and disclose how many units have been sold.

As for eliminating physical books from the warehouses, books are lagging music and video. The end of print is not near, but the writing is on the virtual wall. The economics of the Internet, as well as technology innovations such as improved virtual paper, instant translation, and always on, fast connections to a universe of knowledge indicate that Bezos is on the right track, just as he was in creating a virtual shopping mall for physical goods in 1994. And, he will have lots of company, or competition, as the digital age gets into full swing.

After less than a year, Radar Networks is going from beta to version 1.0 of its Twine "interest network" Web application based on semantic Web technologies. "We are not spending four years in beta," said Radar Networks CEO Nova Spivack. "We have a minimal set of features ready for prime time."

The minimal set of interest network features allows Twine users to track and discover relevant organizations, products, people, places, tags, and items, such as photos, documents, and recipes, that match their interests. Twine has a social dimension in the way it leverages the wisdom of its members, via bookmarking, tagging, and shared connections. Underlying Semantic Web technologies provide concept mapping (such as interrelationships between topics or people) and more relevant and structured search results.

In the last six months of beta testing, 500,000 users visited Twine and 50,000 remain active, Spivack said. Half of the Twines created are public and members have added about one million items to the database. "The most interesting statistic is time spent--which has risen in the last month to 12 minutes per session and continues to trend up. This is more than tracking and discovery sites like delicious, Digg and StumbleUpon receive," he claimed.

In order to keep the 50,000 active users and grow its base, the key change from the beta in version 1.0 is a simplification of the user experience. "When we started beta, Twine was about collecting, organizing, discovering, and sharing, and all were equal. It turns out that tracking interests is the most important, so that is what we are emphasizing," Spivack said. Among the more consumer friendly enhancements, the site navigation is streamlined, site performance is faster, moderation features are improved, users can invite people from their e-mail address books, and the recommendation engine explains why an item was recommended and allows a user to opt out.

The semantic Web aspect of Twine, which was touted when it first launched, has been relegated to the background.

"When we first launched, semantic technology was the story," Spivack said. "It was novel then, but now we have to show the value, and to do that we can't emphasize the semantic technologies in Twine. It's under the hood and that is where it belongs. We surface the value of semantic in lots of ways, such as with the recommendations. Next year users will be able to create their own data types and build an ontology without knowing it's an ontology."

In about three weeks, an update to Twine 1.0 will add a more advanced bookmarking tool and natural language crawling to improve relevancy. "Every page added to Twine will use natural language processing to determine what is the content versus ads, navigation, and other elements. We'll put the full text in our search index and generate tags and create a summary and then crawl every link in the text one hop out and bring that content in as well," Spivack said.

Next year Twine will unleash more of its semantic power, with richer support for structured data and a two-way API for getting data in and out of Twine that will attract application developers, Spivack said. In addition, Twine will introduce a new monetization scheme. "Twine will be to marketing what Google was to advertising," he boasted.

"Advertising is pull-based, passive, and on the side of pages. Marketing is sponsored and highly relevant content that is targeted and delivered to someone in their in interest feeds. It will be clearly marked and users have to option to accept or reject it." The concept is similar to what Facebook has attempted to do with its Beacon program. Spivack said that company has filed patents for its monetization concepts, including a way for users to market semantic objects. "We can provide interesting socio-economics around the content that people collect, share, and buy, and build a one-to-one channel between marketers and users."

Radar Networks is in good shape to weather the economic storm. The company raised $13 million in Series B funding from Velocity Interactive, Draper Fisher Jurvetson, and Vulcan Capital earlier this year.

Below is a video from Radar Networks outlined the new features of Twine 1.0:

Twine Overview from Twine Official on Vimeo

Guest post: Jean-Louis Gassée explains how Microsoft's future business model will borrow from both Apple and Google to compete with the free world of software. The essay was originally posted on Monday Note.

Jean-Louis Gassée

(Credit: Dan Farber)

Unix is the problem or, rather, the free Open Source implementations of its function set called Linux and FreeBSD, to name the best-known variants. While Windows Server and Exchange still reign for many Enterprise applications, tens of millions of Web sites run on Linux of FreeBSD software. Further, the Open Source nature of such software encourages sophisticated users to modify the operating system to fit their specific hardware configurations or applications requirements. For example, Google designs and manufactures (!) its own servers and customizes the Open Source OS they run. There's even a rumor they "roll their own" 10-gigabit Ethernet switches but I don't know vouch for that one. In any event, imagine how much the Google account would be worth to Microsoft if the Mountain View company used Windows Server? Knowledgeable readers will immediately object: Google running Windows Server isn't realistic. Not for price reasons but because Microsoft's server software isn't technically suitable for large "server farms" such as Google's. True. It'll be interesting to look at what Microsoft uses for its own Live cloud. In the past, Microsoft has had to resort to "other" server software for applications such as Hotmail. But, "scalability issues" (the ability to grow to serve very large server farms) aside, Microsoft is losing against free server software for the millions of simpler Web servers sprouting all over the world. And, as Linux and its cousins mature, they will inevitably make inroads in Enterprise applications where Microsoft still leads. Open Source competitors to Exchange do exist, they're not yet a strong threat but, if they keep improving, they will erode Microsoft very juicy server business.

On the desktop, Linux is trouble again, but much less so than in server farms. For consumers, as opposed to technically versed sysadmins, ease of use is still a strong plus for Windows. I bought two identical Asus EeePC netbooks, one running Windows, the other a Linux distribution. Windows is still much easier to use and update, Linux is still a little rough on normal humans. One example out of many glitches: the version I used didn't remember Wi-Fi access points and passwords. I had to re-enter everything each time I turned the machine on. This type of problem has prevented Linux from gaining much ground on the desktop.

But this could change: the success of netbooks, their large unit volumes could encourage a manufacturer such as Asus, Acer or Lenovo to invest in the needed polish to make a Linux-based netbook as easy to use as a PC or Mac -- or close enough at a much lower price. And the name, netbook, reminds us it might not need today's (or is it yesterday's?) full suite of robust desktop applications to succeed--it will run applications on/from the Cloud. Imagine a Google netbook.

Lastly, smartphones. Ballmer tries to change the subject by suggesting Apple ought to license its iPhone OS as opposed to keeping it all to itself. Let's skip over Microsoft's proprietary Xbox and Zune software and, perhaps, the upcoming Danger smartphone. Danger, the maker of the Sidekick PDA, is the company Microsoft bought earlier this year,. Microsoft has been selling Windows Mobile licenses for close to eight years now. In the licensing business, the iPhone isn't the real competition, Android is. How do you compete with a free smartphone OS, and a good one at that, which is supported by Google Cloud applications?

My guess is Steve Ballmer is working on a combined answer, one that is sketched before our very eyes already. Microsoft's Live services are but a rehearsal for a much bigger act, Microsoft's Cloud OS, sometimes called Strata. And, based on Microsoft's own Cloud services, we'll see a Danger-based smartphone, as proprietary as the Xbox and the iPod competitor Zune. Put another way, Microsoft's future business model will borrow from Apple and Google, it will have two components: proprietary devices and "universal" Cloud services. And like its models, it will attempt to extract extra profits by nicely tying both components together. For example: iPods are tied to the iTunes service, Android phones might (we don't know yet) better enjoy Google applications.

Interesting times ahead.

Jean-Louis Gassée is a general partner at Allegis Capital. Prior to his venture capital career he founded Be, Inc., which was sold to Palm in 2001. Gassée also held several positions at Apple Computer. He started Apple France in 1981, and in 1985 became president of the Apple Products Division. Earlier in his career Gassée as worked at Data General, Exxon Office Systems and Hewlett-Packard.

Guest post: Christopher Lochhead, the retired chief marketing officer at Scient and Mercury, offers some turnaround strategies (learned the hard way) for weathering the economic storm.

Economic downturns require extraordinary leadership. They require brutal honesty. They require action. If your market and company are truly in trouble, here are some turnaround strategies (learned the hard way) to weather the storm so you can live to fight another day.

1. There Is No Such Thing As One Bad Quarter

When your markets get weak and/or you really screw up, fixing it will take a lot longer than you think it will. Pray for spring, but get ready for a long, cold winter.

2. Get The Facts Yourself

People don't like to deliver bad news. As an executive, your job is to get to the heart of the problem fast. You (not someone who works for you) need to figure out how bad your problem is.

How bad is the sales forecast? How late is the next release of the product? What is the cash burn rate? How many critical projects are broken? You must drill into the "whys" to make sure you understand the facts and the causes of the problems. The key is to ask "why?" five times.

Why is the project late (you will get an answer)? Then ask why that is the case (you will get another answer), then ask why that is the case (you will get yet a deeper answer), and so on.

Once you've asked why five times, end every conversation with the most powerful question you can ask, "Is there anything else?" Before my grandmother was heading into surgery to fix a broken hip, I asked her doctor that question. He told me something he had not wanted to tell us--that there was a 25 percent chance she would die during the operation. People don't like to deliver bad news. Real leaders get the real facts so they can take real action.

3. Get 2 Top 10 Lists Fast

Get the smartest, most courageous people in the company together this weekend (no more than 10 as big groups do stupid things) to brainstorm about the top 10 ways to drive revenue and the top 10 ways to cut costs. Here are a few ideas to get you started.

Drive revenue:

• Assign every big deal in the pipeline to an executive and make the execs and the salespeople accountable for closing the deals
• Give customers a new incentive to buy this quarter
• Focus on your core markets and ignore the rest
• Announce a competitive replacement program (provide an incentive for customers of your competition to switch)

Cut cost:

• Do a lay-off
• Pull out of under-performing markets or geographies
• Sell under-performing assets or business units
• Stop all stupid travel, off-sites and trade shows (anyone at AIG from there?)

4. Horde Cash

In March of 2000 as the tech bubble was getting ready to burst, my accountant, the legendary Greg Finely, called me and yelled, "Horde cash!" It's good advice in bad times. Meet with your CFO and finance team to figure out how to optimize the cash, and never forget the sage words of the Coen brothers, "Where's the money, Lebowski?"

5. Tear Off The Band-Aid Once

Take all the pain in one big shot. Cut deeper and make bigger changes than you think you need to. The more quarterly forecasts you miss and layoffs you do, the harder it is to recover. Once you know that your company is in trouble, assume it's in worse shape than you realize. Because it is.

If you are going to miss quarterly numbers and forecasts, miss them once. If you have to do a reorg, do it once. And if you are forced to do a layoff, do it once.

6. Fire Executives

It is stunning how many companies do a layoff without firing any executives. You can't layoff 20 percent of the company without letting go of some of the executives (who are at least partially responsible, if not completely responsible for the problem). And don't just demote them, or move them to some other job. Fire them.

7. Chop The Dead Wood

Every company has people on the team who are "C" players. Rather than doing an across-the-board 10 percent cut, make sure that the people you are cutting are the worst performers in your company. Your "A" and "B" players will appreciate the fact that you did the right cutting. This may sound harsh, but no one wants the "C" players around anyway.

8. Tell The Truth

Some executives think that lying, misleading, and otherwise obfuscating will "soften" the blow in bad times. Wrong. Lying never works. It sounds obvious, but companies and executives do it all the time. It can land you in jail or ruin your career (trust me--I've seen this happen to well-meaning but misguided execs). People hate delivering bad news, so they tell a "white lie," which they often rationalize as somehow doing good for others.

Be honest and direct about the facts. Brutally honest. Be honest with your stakeholders. If you are laying off 25 percent of your people, then say that's what you are doing. Don't say, "We are laying off 15 percent and expect some additional headcount reductions through normal attrition."

9. Communicate Clearly and Powerfully

The truth will never be as bad as the rumors will become. "No comment" will increase the untruths and gossip. It will also unleash the venom of the people you used to be forthright with. The press will attack harder, and your employees' distrust will grow deeper. Both will undermine your efforts with customers and drive your stock price even further down. It doesn't matter how much it hurts. You must over-communicate.

When you're in trouble, get clear about what you are going to say before you open your mouth. Rambling or trying to make 16 points will make you look confused, defensive, or stupid. Then get clear on three--and only three-- key messages to deliver: the facts as you know them, the actions you're taking now, and how your actions today position you for future success. Write these messages down, and practice saying them.

10. Sign A Pact In Blood

In November of 2005 Mercury's board of directors fired our CEO, CFO, and general counsel because of a stock-option accounting problem. Our stock tanked, our competitors attacked, and our employees were scared. The key executives in the company agreed to stick together come hell or high water (and boy, did we go through hell and high water, but that's another story).

We didn't wavier. And neither should you. Nine months later, we had settled the accounting problem, turned the company around, produced some of our best quarters ever, did an acquisition, and ultimately Hewlett-Packard bought us for a significant premium. That turned out to be a big win for shareholders, customers, our people and HP.

11. Drive It Like You Stole It

Legendary teams execute their turnaround plans like it is the last thing they will ever do. Take action. Bust your butt. Get on planes and meet with all of you key customers. Rally your teams in town hall meetings in all of your key offices. Refine your strategy. Focus your efforts. Get your people focused on results. Meet with your top investors to tell them how and why your turn around will work. Get help from some wicked advisers. Recruit new talent to the company. Sell, sell, sell, and lead, lead, lead.

Leading a company through a turnaround is arguably the hardest thing to do in business. If you actually do it and pull through, it will become the most rewarding thing you have ever done in business. Good luck and knock 'em alive.