SUBJECT TO CHANGEcreating great products and services for an uncertain world
ContainerizationManufacturing costsplummetGlobal communicationThe world gets smallerDigitalizationProducts get more complex
Media is a messCraigslist took the classifiedsEveryone took a piece of the adsBlogs are taking the readersMusic is in meta...
predicting the future has never been easy,but it’s never been more difficult
Predicting the future won’t work.Meeting about it won’t work.Instead, seek approaches that willcontinue to work no matter ...
A Brief History Lesson
A new photographic apparatus
A NEW PHOTOGRAPHIC APPARATUS.                                           This apparatus consists of a box containing a came...
“You press the button,   we do the rest.”
1   2   3
Why is this story important?  Because this focus on the customer experience        made Kodak successful for years.  And w...
user interface    logic    data
user interfaceMAGIC
user interface      nte      nt      g    logic    data
user interface    logic    data
The experience is the product.
The experience is the product.Focus on the lives of customers.Engage in design as an activity.Think systems, not artifacts...
The experience is the product.Focus on the lives of customers.» Understand people as people.Engage in design as an activit...
No!Compare this to a focusgroup set up
Companies tend to oversimplify    their view of people
4old ways of  thinking
#1                                                      $                 At worst: “a gullet whose only purpose in life i...
#2           Sheep      Docile and gullible     Stories and messaging          Preferences!
#3     Homo Economicus        Highly rational        Maximizes utility          Quantity!
#4     Type A Personality         Task oriented          Goal driven          Efficiency!
Not all wrong, not really right. We are evolving our approaches.
What’s been missing?
The messy complexity of human life
photo by         Windell                 Oskay                         People regularly mix                         and ma...
They challenge socialand cultural boundaries in unexpected ways.
Understand people as people.(Understand them as we understand ourselves.)
What’s been missing?     Behavior    Motivation      Context      Emotion
MotivationConcepts                                                                         Compare Banks                  ...
2: online                                                                                                                 ...
"Medical device manufacturers are stuck in abygone era; they continue to design theseproducts in an engineering-driven, ph...
She has a point...
We talked to diabetics
Easy to learn and teach/No numbersMake better use of dataLess stuffKeep users in controlHelp keep users motivatedWear it d...
Behavior   Tasks              Motivation   Goals               ContextPreferences               Emotion
More insightBy changing the size and shapeof our research filters, moreand better information getsthrough the sifting proc...
ple?                                  rs as peo                           custome                    your           dersta...
The experience is the product.Focus on the lives of customers.» Understand people as people.Engage in design as an activit...
Five ways of thinking of design
1. Design as aesthetics
2. Design as a distinct role
3. Design as a thing
4. Design as a rock star
Five ways of thinking of design1. Design as aesthetics2. Design as a distinct role3. Design as a thing4. Design as a rock ...
Design as an activityDesign can be anactivity that anorganizationembraces, thateveryone can beinvolved in.
Designers become facilitators    Design can be an    activity that an    organization    embraces, thatWe engage can be   ...
Complexity warrants design approaches iteration
Complexity warrants design approaches iteration    prototyping              and making
Complexity warrants design approaches  iteration           prototyping        deep/wide                      and making   ...
roac hes?                               ign app                          g des                emb racin      are youHow
The experience is the product.Focus on the lives of customers.» Understand people as people.Engage in design as an activit...
You press the  button…
You press the  button…...and we do   the rest.
Experiences cross boundaries              Finance Co.Statement Phone   Print   Advisor Web
Experiences cross boundaries                    Finance Co.Statement   Phone     Print   Advisor   Web
A safer drug delivery system
The ClearRx system        pill bottle                             pharmacists    ClearRX marketingCustomer-facing experien...
The ClearRx system                                                                   ces?          pill bottle            ...
The experience is the product.Focus on experience.» Use experience as strategy.Focus on the lives of customers.» Understan...
Over 75% of consumers have at least one loyalty card                                          — Jupiter Research  How do y...
“Want loyalty? Get a dog.”           — Randy Susan Wagner, CMO of Orbitz
"Christmas isnt something you buy from a store… Christmas, perhaps, means a little bit more.”
Meaning more means repeatedlycreating notably great experiencesTrue loyalty — and the word-of-mouth that comes with it — e...
Meaning more means repeatedlycreating notably great experiencesNotably great experiences arepunctuated by a moment of “wow...
Peak-end rule                    average                    average                from Daniel Kahneman
The Long Wow                        Plan and stage                           the wow                          experience  ...
4. Plan and stage the wow experience  organize a pipeline of wow moments that can be  introduced through your palette of t...
pack in     unfold newfeatures up   experiences   front       over time
wowSynched tracking
{ }
{   …it’s the eye of the tiger it the thrill of the fight…   }                                                            ...
wowCollaborativerunning
wowNetworkedrunning events
Nike+                              Running                                                           sportsband           ...
The Long Wow                      Plan and stage                         the wow                        experience        ...
an create                              at c                         rm thwow wow wow wo      wow wow wowfo g haul?        ...
The experience is the product.Focus on experience.» Use experience as strategy.Focus on the lives of customers.» Understan...
Goals of the bookArticulate a newapproach to creatingproducts and servicesin an uncertain worldAnd address a gapinghole in...
362 firms                   95% say they are                   “customer focused”                   80% say they deliver a...
SUBJECT TO CHANGEcreating great products and services for an uncertain worldShort, but powerful. Easy to read,yet profound...
Additional Photo CreditsSlides 78, 79, 82. "Basinghill path" David (satguru).http://flickr.com/photos/satguru/2301780965/S...
August 12-15, 2008                                      San Francisco                                      Featuring Don N...
Peter Merholz at BayCHI July 8, 2008: Creating Great Products and Services in an Uncertain World
Peter Merholz at BayCHI July 8, 2008: Creating Great Products and Services in an Uncertain World
Peter Merholz at BayCHI July 8, 2008: Creating Great Products and Services in an Uncertain World
Peter Merholz at BayCHI July 8, 2008: Creating Great Products and Services in an Uncertain World
Peter Merholz at BayCHI July 8, 2008: Creating Great Products and Services in an Uncertain World
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Peter Merholz at BayCHI July 8, 2008: Creating Great Products and Services in an Uncertain World

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The way most organizations think and work on products and services isn't suited to the unpredictable world we live in. Instead, companies need new ways of thinking and working to adapt into innovative, agile, and commercially successful organizations who creates great products and services. Peter Merholz, one of the authors of Adaptive Path's new book, Subject to Change, will share a handful of breakthrough ideas for succeeding in a future that you can't predict.

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Peter Merholz at BayCHI July 8, 2008: Creating Great Products and Services in an Uncertain World

  1. 1. SUBJECT TO CHANGEcreating great products and services for an uncertain world
  2. 2. ContainerizationManufacturing costsplummetGlobal communicationThe world gets smallerDigitalizationProducts get more complex
  3. 3. Media is a messCraigslist took the classifiedsEveryone took a piece of the adsBlogs are taking the readersMusic is in metamorphosisiTunes is the #1 retailerLabels are losing their gripTravel is turbulentThe three top quality carriersare all low-fair airlines
  4. 4. predicting the future has never been easy,but it’s never been more difficult
  5. 5. Predicting the future won’t work.Meeting about it won’t work.Instead, seek approaches that willcontinue to work no matter whichprediction comes true.
  6. 6. A Brief History Lesson
  7. 7. A new photographic apparatus
  8. 8. A NEW PHOTOGRAPHIC APPARATUS. This apparatus consists of a box containing a camera, A, and a frame, C, containing the desired number of plates, each held in a small frame of black Bristol board. The camera contains a mirror, M, which pivots upon an axis and is maneuvered by the extreme bottom, B. This mirror stops at an angle of 45°, and sends the image coming from the objective to the horizontal plate, D, at the upper part of the camera. The image thus reflected is righted upon this plate. s beyondInobjective isofofthree yards from operator situatedin hotographic apparatu nearer the object to be photographed, the focusing would be As the short focus, every objectA new p a distance the apparatus is focus. exceptional cases, where the might be done by means of the rack of the objective. The latter can also slide up and down, so that the apparatus need not be inclined when buildings or high trees are being photographed. The door, E, performs the role of a shade. When the apparatus has been fixed upon its tripod and properly directed, all the operator has to do is to close the door, P and , raise the mirror, M, by turning the button, B, and then expose the plate. The sensitized plates are introduced into the apparatus through the door, I, and are always brought automatically to the focus of the objective through the pressure of the springs, R. The shutter of the frame, B, opens through a hook, H, with in the pocket, N. After exposure, each plate is lifted by means of the extractor, K, into the pocket, whence it is taken by hand and introduced through a slit, S, behind the springs, R, and the other plates that the frame contains. All these operations are performed in the interior of the pocket, N, through the impermeable, triple fabric of which no light can enter. An automatic marker shows the number of plates exposed. When the operations are finished, the objective is put back in the interior of the camera, the doors, P and E, are closed, and the pocket is rolled up. The apparatus is thus hermetically closed, and, containing all the accessories, forms one of the most practical of systems for the itinerant photographer.
  9. 9. “You press the button, we do the rest.”
  10. 10. 1 2 3
  11. 11. Why is this story important? Because this focus on the customer experience made Kodak successful for years. And when they’ve stumbled it’s been because they lost this focus.
  12. 12. user interface logic data
  13. 13. user interfaceMAGIC
  14. 14. user interface nte nt g logic data
  15. 15. user interface logic data
  16. 16. The experience is the product.
  17. 17. The experience is the product.Focus on the lives of customers.Engage in design as an activity.Think systems, not artifacts.Deliver the Long Wow.
  18. 18. The experience is the product.Focus on the lives of customers.» Understand people as people.Engage in design as an activity.Think systems, not artifacts.Deliver the Long Wow.
  19. 19. No!Compare this to a focusgroup set up
  20. 20. Companies tend to oversimplify their view of people
  21. 21. 4old ways of thinking
  22. 22. #1 $ At worst: “a gullet whose only purpose in life is to gulp products and crap cash.” Ruthlessly stolen from The Cluetrain Manifesto
  23. 23. #2 Sheep Docile and gullible Stories and messaging Preferences!
  24. 24. #3 Homo Economicus Highly rational Maximizes utility Quantity!
  25. 25. #4 Type A Personality Task oriented Goal driven Efficiency!
  26. 26. Not all wrong, not really right. We are evolving our approaches.
  27. 27. What’s been missing?
  28. 28. The messy complexity of human life
  29. 29. photo by Windell Oskay People regularly mix and match products with little regard for “suggested use.”
  30. 30. They challenge socialand cultural boundaries in unexpected ways.
  31. 31. Understand people as people.(Understand them as we understand ourselves.)
  32. 32. What’s been missing? Behavior Motivation Context Emotion
  33. 33. MotivationConcepts Compare Banks Compare Products Evaluate Future Products Understand Product Details Run scenarios Get Overview of with tools Products Research Read bank specific loan brochures options Get business Look at Research loan info in mortgage Research Products branch Look at specific rates Banks Across Banks items Read Research Learn about Research Read Conduct Evaluate Long promotional checking bill pay business Learn About Research Bank brochures Followup Term Banking mail needs features insurance Process Locations Negotiate Research Options Review Consider types Attend home Look for Research Research Negotiate in refinance Research fees Mark funds for Research of business buyng seminar Define Personal Call Bank About branches banks online Research credit line branch Become Aware further review checking services Realize options Needs Product Technology of Products unreadiness Learn the Talk to BofA Research Seek Look for Evaluate long home buying Create mental about Look for safety banks in Compatibility Compare Negotiate over Seek mutual funds/ Research Follow up over Research IRAs term banking Realize process list of needs mortgage deposit box person with MSN rates phone promotions IRAs specific funds phone options unreadiness Financial Financial Compare Compare planning planning Contact Locations Offers FAQ Products Contact Offers Product info Rates Checklist Products Welcome kit resource resource Mental Space Mental Space Calculator Live chat Quarterly Help Locations Product list Product list Comparison Contact report Locations Contact Feature list Locations Community Locations Fees Live chat info LOB info Product demo Terms Opt-in Line info Eligibility Form Case study list Product specs Case study Feature info Security detail Product Feature specs Use process selector Live chat Product demo Calculator
  34. 34. 2: online multi-session 1: convenience research research Motivation online first bank convenience site experience indicates ease of working with bank online go online first to conveniently get convenience knowledge fear of being ion consolidat 3: knowledge evaluatingConcepts Compare Banks manipulated Compare Products Evaluate Future Products future products 2: online multi-session 1: convenience knowledge is research power research need to be a Understand Product Details online first responsible consumer no clear end Get Overview of Products Run scenarios with tools state Read bank Research go online first to conveniently get knowledge fear of being 3: knowledgespecific loan brochures options manipulated Get business Look at Research loan info in mortgage Research Products branch Look at specific rates Banks Across Banks items knowledge is Read Research power Learn about Conduct Research Evaluate Long Learn About Research Ban ch B h Bank promotional mail Read brochures need to be a checking needs bill pay features Followup business insurance Term Banking Negotiate Process tions Locations responsible going through Research Options consumer the motionsend no clear Review Consider types Attend home Look for k Research Research Negotiate in refinance Research fees Mark funds for Research of business buyng seminar Define Personal Call Bank About branches ches banks online Research credit line branch Become Aware further review checking Realize e Needs Product Technology of Products stateoptions services ess unreadiness Learn the Talk to BofA Research Seek Look for get knowledge before talking to a person Evaluate long home buying Create mental about Look for safety r banks in Compatibility Compare Negotiate over Seek mutual funds/ Research Follow up over Research IRAs term banking Realize process list of needs mortgage deposit box it person with MSN rates compelledphone seek bargains to promotions IRAs specific funds phone options unreadiness ss Financial Financial Compare going through Compare planning resource planning resource Contact Locations tions Offers FAQ Products Mental Space Contact Offers the motions Product info Rates Checklist Products Mental Space Welcome kit emotional get knowledge before Calculator Live chat Quarterly report Help Locations compelled to seek bargains list Product list Product requirements talking to a person Comparison Contact Locations Contact Feature list Locations emotional Community Locations Fees requirements Live chat info sensitivity to multi-channel LOB info cost Product demo Terms process sensitivity to multi-channel Opt-in Line info Eligibility Form cost identification process with personas Case study list Product specs identification with personas privacy and Case study detail Feature info Security security privacy and serious Product security specs Feature Use process serious selector transactionss transaction notnot online online Live chat Product demo Calculator 4: ion 4: emotemotion
  35. 35. "Medical device manufacturers are stuck in abygone era; they continue to design theseproducts in an engineering-driven, physician-centered bubble. They have not yet grasped theconcept that medical devices are also lifedevices, and therefore need to feel good andlook good for the patients using them 24/7, inaddition to keeping us alive."Amy Tenderich, Diabetes Mine blog
  36. 36. She has a point...
  37. 37. We talked to diabetics
  38. 38. Easy to learn and teach/No numbersMake better use of dataLess stuffKeep users in controlHelp keep users motivatedWear it during sex
  39. 39. Behavior Tasks Motivation Goals ContextPreferences Emotion
  40. 40. More insightBy changing the size and shapeof our research filters, moreand better information getsthrough the sifting process.
  41. 41. ple? rs as peo custome your derstandDo you un
  42. 42. The experience is the product.Focus on the lives of customers.» Understand people as people.Engage in design as an activity.» Design becomes an organizational competency.Think systems, not artifacts.Deliver the Long Wow.
  43. 43. Five ways of thinking of design
  44. 44. 1. Design as aesthetics
  45. 45. 2. Design as a distinct role
  46. 46. 3. Design as a thing
  47. 47. 4. Design as a rock star
  48. 48. Five ways of thinking of design1. Design as aesthetics2. Design as a distinct role3. Design as a thing4. Design as a rock star5. ???
  49. 49. Design as an activityDesign can be anactivity that anorganizationembraces, thateveryone can beinvolved in.
  50. 50. Designers become facilitators Design can be an activity that an organization embraces, thatWe engage can be everyonecross-functional involved in.teams, get designideas out ofthem, and thenwork to refineand hone them
  51. 51. Complexity warrants design approaches iteration
  52. 52. Complexity warrants design approaches iteration prototyping and making
  53. 53. Complexity warrants design approaches iteration prototyping deep/wide and making collaboration Finance Co.Statement Phone Print Advisor Web
  54. 54. roac hes? ign app g des emb racin are youHow
  55. 55. The experience is the product.Focus on the lives of customers.» Understand people as people.Engage in design as an activity.» Design becomes an organizational competency.Think systems, not artifacts.» Embrace complexity, and expose appropriatelyDeliver the Long Wow.
  56. 56. You press the button…
  57. 57. You press the button…...and we do the rest.
  58. 58. Experiences cross boundaries Finance Co.Statement Phone Print Advisor Web
  59. 59. Experiences cross boundaries Finance Co.Statement Phone Print Advisor Web
  60. 60. A safer drug delivery system
  61. 61. The ClearRx system pill bottle pharmacists ClearRX marketingCustomer-facing experience POS system training CRM supply chainIT systems and operations
  62. 62. The ClearRx system ces? pill bottle exp erien port pharmacists ClearRX marketing t sup s tha Customer-facing experience stem ng sy u de signiAre yo POS system training CRM supply chain IT systems and operations
  63. 63. The experience is the product.Focus on experience.» Use experience as strategy.Focus on the lives of customers.» Understand people as people.Think systems, not artifacts.» Embrace complexity, and expose appropriately.Deliver The Long Wow.» Unfold delightful experiences over time.
  64. 64. Over 75% of consumers have at least one loyalty card — Jupiter Research How do youcreate customer loyalty?
  65. 65. “Want loyalty? Get a dog.” — Randy Susan Wagner, CMO of Orbitz
  66. 66. "Christmas isnt something you buy from a store… Christmas, perhaps, means a little bit more.”
  67. 67. Meaning more means repeatedlycreating notably great experiencesTrue loyalty — and the word-of-mouth that comes with it — evolvesnatural from the great experience youhave with a company over time.
  68. 68. Meaning more means repeatedlycreating notably great experiencesNotably great experiences arepunctuated by a moment of “wow,”when the product or service delights,anticipates the needs of, or pleasantlysurprises a person.
  69. 69. Peak-end rule average average from Daniel Kahneman
  70. 70. The Long Wow Plan and stage the wow experience wowManage your Evolve yourplatform for repeatable delivery process Draw from a wide area of unmet needs
  71. 71. 4. Plan and stage the wow experience organize a pipeline of wow moments that can be introduced through your palette of touchpoints over time Before Now Next Later
  72. 72. pack in unfold newfeatures up experiences front over time
  73. 73. wowSynched tracking
  74. 74. { }
  75. 75. { …it’s the eye of the tiger it the thrill of the fight… } wow Powersong!
  76. 76. wowCollaborativerunning
  77. 77. wowNetworkedrunning events
  78. 78. Nike+ Running sportsband shoes Synched tracking iPod nano Networked running eventsTracking tools Pedometer Voiceover feedback Nike+ website Music Sport iMixes Desktop Collaborative running widgets Powersongs
  79. 79. The Long Wow Plan and stage the wow experience wow wow wow wow wow wow wow wo wo wo woManage your Evolve yourplatform for repeatable delivery process Draw from a wide area of unmet needs
  80. 80. an create at c rm thwow wow wow wo wow wow wowfo g haul? lat wow g a p the lon ildin over u bu ntsAre yo omewo wm
  81. 81. The experience is the product.Focus on experience.» Use experience as strategy.Focus on the lives of customers.» Understand people as people.Embrace the complexity.» Use systems to support experiences.Engage in design as an activity.» Design as an organization competency.
  82. 82. Goals of the bookArticulate a newapproach to creatingproducts and servicesin an uncertain worldAnd address a gapinghole in how companiesserve people
  83. 83. 362 firms 95% say they are “customer focused” 80% say they deliver a “superior experience” How many of these firms’ customers agree that they deliver a superior experience? 8%from “Closing the Delivery Gap” by Bain & Company
  84. 84. SUBJECT TO CHANGEcreating great products and services for an uncertain worldShort, but powerful. Easy to read,yet profound. I’ve been searchingfor just this book: the one perfectbook that summarizes theessence of modern  productdesign. This is it... I will use it inmy courses for MBA students.You should use it for, well, foreveryone.”— Don Norman, author Design of Everyday Things Peter Merholz peterme@adaptivepath.com
  85. 85. Additional Photo CreditsSlides 78, 79, 82. "Basinghill path" David (satguru).http://flickr.com/photos/satguru/2301780965/Slide 80. "Vincent Massey Park - Path?" Alison C (Allie in Wonderland).http://flickr.com/photos/allie-in-wonderland/1810364260/Slide 80. "The road/pavement markings." Matt Seppingshttp://flickr.com/photos/chumpolo/165026463/Slide 69. "Loyal Pal" (dennis and aimee jonez)http://flickr.com/photos/jonezes/233928794/Slide 75. "blue line" Crispin Semmens (conskeptical).http://flickr.com/photos/conskeptical/292241229/—all photos some right reserved: Creative Commons http://creativecommons.org/licenses/by/3.0/
  86. 86. August 12-15, 2008 San Francisco Featuring Don Norman, Jensen Harris, Indi Young, Bruce Sterling, and people from Google, TheDailyShow.com, IDEO, Zipcar, and more! Day 1: Fundamentals of User Experience Day 2: Service and Media Design Day 3: Play and Immersion Day 4: The Future of User Experience http://uxweek.com/Use promotional code FOPM and get 15% off the registration price.

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