This is an interesting statement coming from a company that supposedly specializes in SEO, so I want to clarify the title. 
When I say SEO, I mean what is typically viewed as SEO today. This common “view” or perception could be summarized by this typical SEO package offering:
·         Optimize for 5, 10,15, etc  keywords
·         Optimized meta data and title tags
·         Link building
·         Optimized Content
·         Track ranking on targeted keywords
·         Monthly Reporting
There are typically a few more bullet points, but in general most SEO companies are going to find some keyword phrases that you could rank on,  optimize the content around those keywords then do link building to send signals to the search engines.  
We believe that this is a strategy that is doomed to fail in the near future, and even if it works, will generate minimal results.   
What Google Wants
We think that SEO should be much different than offering a package of targeted keywords, doing on-going link building and reporting rankings on those keywords.  Don’t get me wrong, many of the things that are in a typical package are good to do, and should be done. But none of them directly addresses what Google wants for its search results; relevance. This is what Google always wanted but since it couldn’t have a bunch of people reading all the content to determine the most relevant, they developed algorithms.   An algorithm is a program that applies certain rules or tests to data and ranks them.   The programs can’t really understand what the content is about the way a human can, but they simple run measurements based on what Google believes is the best determination of relevance.
As soon as search engines started doing this, an industry called search engine optimization (SEO) was born.    SEO specialists would try to figure out what the algorithm was looking for and make changes at and around the website that were designed to trigger these “relevance” signals and convince the search engines that the website they were working on should be ranked #1. The result was that search results were more based on SEO tricks than actual relevance.   And Google (as well as Bing) have been modifying algorithms to improve relevance. 
Google’s algorithm is getting smarter
 About 2 years ago, Google started introducing changes that were specifically aimed at the “gaming” being done to manipulate rankings.  These series of changes were known as Panda and Penguin and they are forcing SEO to change.    Some of us in the industry are not really catching on.   Many SEO companies are still “chasing” the algorithm changes believing that they can continue to game the system.    And yes there are some companies that are still having success, but the long term risks of “gaming the system” certainly outweigh the short term ranking benefits, as some companies who are now spending thousands of dollars trying to “undo” years of back link generation can attest to.
The New SEO vision
SEO will not be an effective long term strategy until it is fully aligned with Google goals, which is to present the most relevant results possible on searches.  Part of the relevance puzzle is related to who is doing the searching.    Google understands that relevance changes from one user to another.   What is relevant to a searcher in New Jersey is not necessarily relevant to a searcher in Montana.    What is relevant to a 45 year old male may be different than a 20 year old female.   Today search results change based on location, user profiles and user historical search patterns.   Google ideally wants to tailor search results to the specific searcher.
SEO needs to incorporate an entirely different approach or become totally useless.  Some of the “staples” that were part of every SEO strategy need to shift:
Overall Strategy:   The central question that one should ask about their web properties should be related to the relevance it has to its target market.    Are you presenting the products and services of your companies in a way that is meaningful to your target market?   This is a very broad question, but I think it will bring different sets of activity as opposed to “how can I change the website to rank on my targeted search terms”?
Keyword Research:  Traditional keyword research was based on finding phrases that had some search volume but lower competition.    These keywords were targeted because it was easier to get 1st page ranking in a shorter period of time.    Often this resulted in ranking high in a few search terms, but not having much business to show for it.   I think that keyword research can still be effective, but we need to add the “relevance” factor to it. For example, keyword research can uncover ways that your targeted market thinks about the problems, solutions or issues relating to your service that you may not have thought about.   Keyword research should be a discovery process that helps a business fully understand what is relevant from the customer’s perspective.   It can also help reveal questions surrounding your products and services that may need to be answered to help the user better understand your value proposition.    Once a company fully understands what their targeted market is searching for, it can formulate a more effective content strategy.
Link Building: All the traditional link building techniques need to be thrown out the window because most of them will hurt a site more than help.   I don’t want to say that link building is completely dead, because inbound links are still something search engines look at to assess relevance.     But links need to be from relevant (and trusted) sources.   Creating content that is truly valuable to a target audience will create natural links. Perhaps this content will need to be promoted to get the initials audience, but the most valuable link will be from a source that viewed your content and has decide that linking to your content will be useful to its audience.
Instead of doing mindless link building, one needs to ask these questions:
·         Is your company branding consistent across all channels? .
·         Are you engaging in conversations with your audience across a variety of social channels?
·         Are you using multiple forms of media to discuss your products or services?
Ranking Reports: Ranking reports are no longer the best determination to measure your sites relevance.   For one thing rankings change based on user and location, a typical ranking report is usually based on a single perspective and location.    Also ranking on selective keywords that were chosen at some point in time may not be the most important keywords that have the most relevance.   Ranking and traffic need to be viewed in conjunction with visitor engagement.   If traffic coming to your site from a specific keyword has a high bounce rate, then the landing page lacks relevance. Either the landing page needs to be changed, or the targeted phrases are not the right phrases.   It is more important to understand your contents relevance to your target market rather than track rankings.
Content Generation: Generating relevant, engaging content across multiple channels is the best way to increase your relevance for all your web assets. Many companies are doing content creating, but it is not good enough.    Content needs to be based on your businesses core expertise to be valuable.    Having valuable, relevant content that can’t be found anywhere else on the internet will generate traffic as well as create natural inbound links.    More thought and research will be required to generate good content.   
Obstacles for the new methods
The new SEO methods will take longer and be more expensive.    One of the advantages of the typical “SEO packages” is that it did not involve much time from the business to execute.   In fact many SEO companies use this as a selling point. Most people are attracted to things that are faster and easier.   Customers will need to understand that while the new methods will take longer to achieve results; it is the best course of action over the long haul.