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Online Retail Logistics Conference 
18-19 November 2014 
Planning for Rapid Growth 
and Economic Uncertainty 
Charles E. C...
Several years ago science historian James Burke hosted a TV show 
on the BBC, Connections, an Alternative View of Change, ...
For example: The invention of the stirrup in China let people sit 
securely on horses. Mounted cavalry led to heavily armo...
In the last episode of Connections, James Burke discussed change 
itself, noting that “The ease with which information can...
Photos: Wikipedia, Twentieth Century Fox 
This was the world in 1979: 
The Apple II was a hot computer. 
The Internet did ...
Today we are overwhelmed by change. Let’s look at a few things 
you can do to address the challenge of continuous change. ...
Strategy as Simple Rules 
Image: iStockPhoto
Photos: TheOldMotor.com, C. Crouch 
When business was simple, 
one could afford complex strategies 
Now complex business n...
Establish Position 
Leverage Resources 
Simple Rules 
Strategy Types 
The classic view often taught 
in school. A unique p...
Simple Rules Strategy 
Quickly recognize positive/ 
negative situations in the 
marketplace. 
Act accordingly. 
Military f...
3 Approaches Compared 
Position Resources Simple Rules 
Competitive 
Advantage 
Unique, valuable 
position 
Unique, valuab...
Establish Position 
Leverage Resources 
Simple Rules 
TAXI 
Both the Established Position and Leveraged Resources Strategi...
Some years ago Cisco was acquiring small 
companies at the rate one per week. They 
used a set of simple rules to quickly ...
Quickly evaluating potential 
opportunities is still a vital skill today. 
In Silicon Valley, Mergers Must Meet the Toothb...
Tall Timber Café 
Steve Rowley, co-owner of the Tall Timber Café in Melbourne, 
Australia was asked by a customer for some...
No, he built a product and started a business. After18 months 
FrankBody.com is now selling one pack per minute and 
shipp...
Business Processes 
Photo: C. Crouch 
Companies can apply this same 
idea of Simple Rules to their 
internal business proc...
Social Media? 
Photo: C. Crouch 
For example, social media is a 
common marketing tool today, 
but many companies make 
mi...
Social Media 
Policy 
To provide guidance, many organizations prepare a social media 
policy (probably because their lawye...
Source: Air Force Public Affairs Agency, Emerging Technology Division, 2009 
Respond to online blogs 
Flow chart 
Easy to ...
Which makes more sense? A 
heavy document no one reads or 
a light page everyone can use?
Think Lean 
Photo: AngMoKoi, Wikipedia 
The Lean Startup movement is 
popular now as entrepreneurs 
around the world start...
Feedback 
Feedback 
Feedback 
Build Test 
Gather 
Require-cents 
Release 
to 
Market 
Customers 
Customer Development 
Lea...
Eric Ries combined Steve Blank’s customer development ideas 
with agile software development and Toyota’s lean production ...
Business Idea Development 
Frontload 
Time 
Classic 
Lean 
Classic development loads lots 
of resources at the front end 
...
The Lean Startup idea has 
proved so useful that a whole 
ecosystem has evolved.
Thinking Lean 
Determine best plan 
Identify riskiest parts 
Test these first 
Small experiments 
Build Something 
No One ...
Staff at Marriott hotels noticed 
people wandering through their 
lobbies, looking for places to meet 
and work for short ...
Meeting Space: by the hour 
They decided to test a new 
service, renting conference 
rooms by the hour. One risk 
was the ...
To reduce these risks they partnered 
with LiquidSpace to run the booking 
system and had a trial run at hotels in 
Washin...
http://www.workspaces.marriott.com 
The test was successful and todayWork[Space] on Demand is 
operating at over 400 hotel...
StyleRocks is an online Australian 
company offering customized jewelry. 
The owner started StyleRocks when she 
was home ...
The company provides different 
options to customize each piece. 
They offer a free resizing service 
for rings but notice...
The website offered a sizing 
guide which had to be printed, 
cut, pulled to fit and measured.
3D Ring Printing 
Check sizing 
Credit on purchase 
More committed 
Alternatively, customers can order 
a test ring made o...
This program has recently 
launched as a test to see how 
the market reacts. 
The design files for the rings were already ...
Takeaways 
Photo: C. Crouch
Today we live in a whack-a-mole world 
where new products, competitors, services 
and customers pop up at any time. 
Video...
Can you simplify your 
own rules and processes 
to make them easier to 
use when conditions 
change - and they will! 
Simp...
Think Lean 
Experiment with new ideas, 
see what works for you, 
then do more of them. 
Photo: C. Crouch
Assignment 
1. What complex process 
can I replace with a 
simple rule? 
2. That new idea I have . 
How can I tr y simple ...
Other Presentations 
on SlideShare 
Photo: C. Crouch
Questions? 
Charles E. Crouch 
charles.crouch@mac.com 
+61 447 413 070 
CharlesECrouch 
Photo: iStockPhoto
Online Retail Logistics Conference 
18-19 November 2014 
Planning for Rapid Growth 
and Economic Uncertainty 
Charles E. C...
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Planning for Rapid Growth and Economic Uncertainty

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Online Retail Logistics Conference, 18-19 November, Sydney, Australia
As James Burke observed in his TV show "Connections," when information spread gradually, change occurred slowly. Today the online world spreads information explosively, and change is a constant. Two business techniques are discussed to address today's rapid change:
• Strategy as Simple Rules. Complex businesses need to simplify to be able to quickly adapt to changes in their marketplace. Using simple rules to describe and operate business processes lets people easily understand how to act when confronted with a new situation.
• Thinking Lean. The lean startup movement focuses on helping small startup businesses use their limited resources efficiently. Small, incremental steps, accompanied by adaptive changes, to a goal are preferred over a massive project which requires immense resources. Even large businesses can apply lean principles when deciding whether to enter a new market.

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Planning for Rapid Growth and Economic Uncertainty

  1. 1. Online Retail Logistics Conference 18-19 November 2014 Planning for Rapid Growth and Economic Uncertainty Charles E. Crouch Lecturer in e-Business & Digital Marketing Chisholm Institute CC by 4.0
  2. 2. Several years ago science historian James Burke hosted a TV show on the BBC, Connections, an Alternative View of Change, discussing the history of science, invention and accompanying changes. Images: BBC
  3. 3. For example: The invention of the stirrup in China let people sit securely on horses. Mounted cavalry led to heavily armored knights on massive horses with accompanying squires and attendants. Supporting these knights required major changes to agriculture, estates and towns, leading to centralized commerce. Images: Wikipedia, C. Crouch However, for centuries the rate of change was slow.
  4. 4. In the last episode of Connections, James Burke discussed change itself, noting that “The ease with which information can spread is critical to the rate at which change occurs.” But this episode was televised in 1979! 1978! 1979! Image: BBC
  5. 5. Photos: Wikipedia, Twentieth Century Fox This was the world in 1979: The Apple II was a hot computer. The Internet did not exist. Several universities and government labs were connected by something called the ARPANET. Mobile phones were still a decade away. Social Media? What’s that?
  6. 6. Today we are overwhelmed by change. Let’s look at a few things you can do to address the challenge of continuous change. Photos: Microsoft, iStockPhoto
  7. 7. Strategy as Simple Rules Image: iStockPhoto
  8. 8. Photos: TheOldMotor.com, C. Crouch When business was simple, one could afford complex strategies Now complex business needs to simplify
  9. 9. Establish Position Leverage Resources Simple Rules Strategy Types The classic view often taught in school. A unique position is exploited in the market. A newer approach in which differentiating resources are used across separate markets Knowing when to act, seizing fleeting opportunities Photos: C. Crouch Adapted from: Kathleen Eisenhart & Donald Sull, “Strategy as Simple Rules”, Harvard Business Review, 2001
  10. 10. Simple Rules Strategy Quickly recognize positive/ negative situations in the marketplace. Act accordingly. Military forces have used a simple rules strategy for years by publishing clear, brief Rules of Engagement to tell troops how to act.
  11. 11. 3 Approaches Compared Position Resources Simple Rules Competitive Advantage Unique, valuable position Unique, valuable resources Unique, simple rules & processes Works Best Well-structured slowly changing markets Well-structured moderately changing, markets Ambiguous rapidly changing markets Risk Hard to alter position as markets change Slow to build new resources as markets change Hesitant to take promising opportunities Source: K. Eisenhart & D. Sull, “Strategy as Simple Rules”, Harvard Business Review, 2001
  12. 12. Establish Position Leverage Resources Simple Rules TAXI Both the Established Position and Leveraged Resources Strategies are under attack today by nimbler, digital-based companies. But having a Simple Rules strategy is one way to adapt.
  13. 13. Some years ago Cisco was acquiring small companies at the rate one per week. They used a set of simple rules to quickly decide which companies to investigate farther. Maximum 75 employees 1. Smaller companies Growth phase Cheaper Technology skills 75% must be engineers 2. ✔ ✔
  14. 14. Quickly evaluating potential opportunities is still a vital skill today. In Silicon Valley, Mergers Must Meet the Toothbrush Test By DAVID GELLES AUGUST 17, 2014 9:22 PM Is it something you will use once or twice a day, and does it make your life better? When deciding whether Google should spend millions in acquiring a new company, Larry Page, asks whether the acquisition passes the toothbrush test: http://dealbook.nytimes.com/2014/08/17/in-silicon-valley-mergers-must-meet-the-toothbrush-test
  15. 15. Tall Timber Café Steve Rowley, co-owner of the Tall Timber Café in Melbourne, Australia was asked by a customer for some old coffee grounds to use as a scrub for cellulite. Did he just give the customer the grounds…? Source: Fiona Smith, Australian Financial Review, 25 Oct 14 Photo: Eddie Jim, goodfood.com.au
  16. 16. No, he built a product and started a business. After18 months FrankBody.com is now selling one pack per minute and shipping to countries around the world.
  17. 17. Business Processes Photo: C. Crouch Companies can apply this same idea of Simple Rules to their internal business processes.
  18. 18. Social Media? Photo: C. Crouch For example, social media is a common marketing tool today, but many companies make mistakes using it.
  19. 19. Social Media Policy To provide guidance, many organizations prepare a social media policy (probably because their lawyers or HR told them to). They instruct everyone to read the policy, but how many people actually use it? Could “simple rules” make this easier?
  20. 20. Source: Air Force Public Affairs Agency, Emerging Technology Division, 2009 Respond to online blogs Flow chart Easy to use The US Air Force has a one-page policy/flow chart showing how to respond to online blogs.
  21. 21. Which makes more sense? A heavy document no one reads or a light page everyone can use?
  22. 22. Think Lean Photo: AngMoKoi, Wikipedia The Lean Startup movement is popular now as entrepreneurs around the world start their own businesses.
  23. 23. Feedback Feedback Feedback Build Test Gather Require-cents Release to Market Customers Customer Development Lean startup began in the software industry where the classic model involved customers at the start, but then ignored them until the final product was delivered. Steve Blank popularized “customer development” which involved customer feedback at all stages in the software development process.
  24. 24. Eric Ries combined Steve Blank’s customer development ideas with agile software development and Toyota’s lean production into the Lean Startup Lean: efficient resource use Especially Time ‣ Blank’s Customer Development ‣ Agile Software processes ‣ Toyota Lean Production Agile development uses collaboration and continuous improvement to evolve requirements and solutions. Lean production focuses on reducing waste to improve customer value.
  25. 25. Business Idea Development Frontload Time Classic Lean Classic development loads lots of resources at the front end of a project. Lean methods run many small trials to continually improve as the project progresses
  26. 26. The Lean Startup idea has proved so useful that a whole ecosystem has evolved.
  27. 27. Thinking Lean Determine best plan Identify riskiest parts Test these first Small experiments Build Something No One Wants You can use lean startup methods in your own organization. The biggest risk is building something no one wants or uses, so find this out early, rather than at the end. Photo: iStockPhoto
  28. 28. Staff at Marriott hotels noticed people wandering through their lobbies, looking for places to meet and work for short periods. Also, Marriott had loads of underused conference rooms. Source: Botsman, R. “Sharing’s Not Just for Startups” Boss Magazine, Oct 2014
  29. 29. Meeting Space: by the hour They decided to test a new service, renting conference rooms by the hour. One risk was the expense of building a room reservation system. Another was no one would want to use the service. Photo: Marriott
  30. 30. To reduce these risks they partnered with LiquidSpace to run the booking system and had a trial run at hotels in Washington DC and San Francisco, places where people were used to working remotely.
  31. 31. http://www.workspaces.marriott.com The test was successful and todayWork[Space] on Demand is operating at over 400 hotels and reaching a new customer base of local lawyers, consultants and independents.
  32. 32. StyleRocks is an online Australian company offering customized jewelry. The owner started StyleRocks when she was home with children and frustrated she could not get out to shop. Pascale Helyar-Moray I wanted to be able to create jewelry exactly as I wanted it.
  33. 33. The company provides different options to customize each piece. They offer a free resizing service for rings but noticed many people still got this wrong.
  34. 34. The website offered a sizing guide which had to be printed, cut, pulled to fit and measured.
  35. 35. 3D Ring Printing Check sizing Credit on purchase More committed Alternatively, customers can order a test ring made on a 3D printer.
  36. 36. This program has recently launched as a test to see how the market reacts. The design files for the rings were already at hand, and an outside service prints the 3D rings, reducing the cost of this trial.
  37. 37. Takeaways Photo: C. Crouch
  38. 38. Today we live in a whack-a-mole world where new products, competitors, services and customers pop up at any time. Video: YouTube
  39. 39. Can you simplify your own rules and processes to make them easier to use when conditions change - and they will! Simple Rules Photo: ad:tech/dmg events
  40. 40. Think Lean Experiment with new ideas, see what works for you, then do more of them. Photo: C. Crouch
  41. 41. Assignment 1. What complex process can I replace with a simple rule? 2. That new idea I have . How can I tr y simple experiments to test it? I am a teacher. Now it’s your turn. Here is your assignment.
  42. 42. Other Presentations on SlideShare Photo: C. Crouch
  43. 43. Questions? Charles E. Crouch charles.crouch@mac.com +61 447 413 070 CharlesECrouch Photo: iStockPhoto
  44. 44. Online Retail Logistics Conference 18-19 November 2014 Planning for Rapid Growth and Economic Uncertainty Charles E. Crouch Lecturer in e-Business & Digital Marketing Chisholm Institute CC by 4.0 END

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