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Innovation Incorporated 2018

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This is a broad set of thinking and tools to help entrepreneurs and innovators. I've taken the best practices of companies like Amazon, Apple and Google and decoded their approach.

You'll find frameworks and tools across the four areas (4P's) of innovation;

People
Product
Profit
Promotion

Published in: Business
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Innovation Incorporated 2018

  1. 1. Innovation Inc Mike Parsons Chief Innovation Officer QUALITANCE S U R V I V A L K I T F O R B U S I N E S S I N N O V A T I O N
  2. 2. Learn from the best Deal with the bumps
  3. 3. “95% of innovation fails.” CLAY CHRISTENSEN, INNOVATION GURU
  4. 4. INNOVATION IS HARDHARD
  5. 5. HOPEHOPE
  6. 6. FRAMEWORK SPECTRUM PRINCIPLES Definitions People Product Profit Experience Product System Love Profitability Viability METHODOLOGY CHALLENGES EMERGING FACTORS Discover User Insights Sprint Beta MVP Inspiration Validation Idea to Product Invention vs. Innovation User Experience Technology
  7. 7. DEFINITIONS
  8. 8. How do we create viable and profitable products that users love?
  9. 9. How do we create viable and profitable products that users love?
  10. 10. Oh! Not that word again [IN-UH-VEY-SHUH N]
  11. 11. What do we mean by innovation? BREAKTHROUGH TECHNOLOGY RADICAL SOLUTION HUGE PROBLEM 10X
  12. 12. PHYSICAL IPHONE SERVICE HOME DELIVERY EXPERIENCE RETAIL IN-STORE
  13. 13. Why Innovation Matters
  14. 14. 0 100000000000 200000000000 300000000000 400000000000 1997 2016 Wal-mart Amazon $69B $440M $222B $341B Market Capitalization & Creating Value
  15. 15. Apple vs Microsoft Net Profits ($billion) 0 75 150 225 300 1995 1997 1999 2001 2003 2005 2007 2009 2011 2013 2015 Apple Microsoft Profit & Creating Value
  16. 16. FRAMEWORK How to think about innovation
  17. 17. People Profit Product Promotion The Big Picture STORY, ADVOCACY, MEDIA BUSINESS MODEL, CANVAS, MARKET FIT CULTURE, LEADERSHIP AND VALUES EXPERIENCE, PRODUCT, SYSTEMS
  18. 18. Great products are built by great companies Did the last hire or fire meet our values and standards? Are you upholding the rules of accountability and authority? Are you listening first before speaking and responding? What could you change to reduce employee friction? Growth is a result of solving big customer problems Do you have a healthy profit per employee and customer? Does your P&L have a balance of fixed and variable costs? Can we collect cash faster and pay slower? Are we exceeding the call of customer pains with gains? Testing and learning with customers inspires innovation Have you achieved a sustained advantage in both customer experience and network effects? Is your product equally loveable, viable, and profitable? Do you conduct regular sprints with customer prototypes? Tell a story worth sharing Do your employees and customers know the What, How, Why? Have you recently tested the personality of your message? When was the last time an influencer shared your story? Do you have equal results between paid, earned and own media? PEOPLE PRODUCT PROFIT PROMOTION
  19. 19. HORIZON 1 Defend the core How do we improve our current business strengths? • LAUNCH NEW PRODUCT VARIANTS • SELL PRODUCT TO NEW CHANNELS • EXPAND GEOGRAPHIES • OPEN NEW CUSTOMER SEGMENTS • OPTIMIZE EXISTING TECHNOLOGIES HORIZON 2 Expand the core How do we grow new business strengths? • LAUNCH A NEW PRODUCT • EXPANDING INTO A NEW CATEGORY • ADDRESSING UNMET CONSUMER NEEDS • APPLY EMERGING TECHNOLOGIES HORIZON 3 Transformative Growth How do we grow with radical new innovations? • DEVELOP A NEW ADDITIVE BUSINESS MODEL • DISRUPT OWN CORE BUSINESS • INVESTIGATE EXPONENTIAL TECH, ECONOMICAL AND SOCIAL TRENDS Looking to the Future
  20. 20. Small focused teams working at speed
  21. 21. What’s a Brand Worth?
  22. 22. SPECTRUM How do the world’s best do it?
  23. 23. Innovation Spectrum CUSTOMER EXPERIENCE PRODUCT SYSTEM Store of the future Customer Service Community of this or that Uber for this or that Xbox & Playstation Uniqlo Currency Collaborative economy Hyperloop
  24. 24. Amazon Innovation Spectrum 1-Click Prime Membership Dash Buttons The Everything Store Kindle Amazon Studios AWS 40 Jumbo Jets Alexa CUSTOMER EXPERIENCE PRODUCT SYSTEM
  25. 25. Apple Innovation Spectrum Retail Stores Packaging Genius Bar Siri iTunes Hardware Devices OSX & iOS Supply Chain Swift Language CUSTOMER EXPERIENCE PRODUCT SYSTEM
  26. 26. Google Innovation Spectrum Search Google Apps Maps YouTube Google Home Chrome Android Chrome OS Cloud Platform CUSTOMER EXPERIENCE PRODUCT SYSTEM
  27. 27. Tesla Innovation Spectrum No dealerships Over the Air Updates Cars Batteries Gigafactory CUSTOMER EXPERIENCE PRODUCT SYSTEM
  28. 28. Uber Innovation Spectrum Invisible payments Flexible work times Ride Share Food Delivery Transportation Pricing Algorithms Driver Algorithms Regulation CUSTOMER EXPERIENCE PRODUCT SYSTEM
  29. 29. And it gets even… BETTER
  30. 30. Longevity by cannibalization The CEO, Tim Cook, stated on a public earnings call the company's"base philosophy is to never fear cannibalization.” When a Kodak engineer created the digital camera he paraphrased management's response as ‘that’s cute—but don’t tell anyone about it.’
  31. 31. “We don't punish failed innovation.”
  32. 32. Momentum from leverage 1-Click The Everything Store 40 Jumbo Jets Retail Stores Hardware Devices Supply Chain
  33. 33. Your turn How could you make the way your customers purchase radically better? What’s one new breakthrough product that you could introduce? What system could you design that would set the standard for your industry? CUSTOMER EXPERIENCE PRODUCT SYSTEM
  34. 34. PRINCIPLES How do I stay out of trouble?
  35. 35. How do we create viable and profitable products that users love?
  36. 36. Does the customer desire the product? It needs to be 10x better if the user is to change behavior. Do they miss it when it’s gone? It needs to be so good it’s like going back to SD after seeing HD TV. Do they want to tell someone about it? Is it such a breakthrough that they want to be your advocate. Don’t be Segway!
  37. 37. Do we have the materials and tools we need? Sometimes the technology does not exist. 
 How much will it cost to get a MVP live? Be rigorous in understanding the true in/direct costs. 
 How long will it take? Make a plan to be quick and efficient in releasing an MVP. Don’t be the Apple Newton!
  38. 38. How much are customers willing to pay? Understand the delicate balance between price and function. Have we removed all possible friction from purchase experience? Do it like Uber. Remove the need to get out the wallet. Is our product competitor-proof? Create an offering of one. Be hard to compare with. Don’t be Encarta! $
  39. 39. METHODOLOGY How do I make it happen?
  40. 40. Just Do It!
  41. 41. Discovery 1 2 WEEKS User Insights 2 4 WEEKS Prototype Sprint 3 3 WEEKS MVP 4 12 WEEKS Production 5 3-6 MONTHS PEOPLE & BUSINESS DATA BEHAVIOURAL DATA INTERNAL ALIGNMENT PRODUCT OWNERSHIPTEAM PARTICIPATION BUILD A TEAM OF FEARLESS COLLABORATORS DEFINE THE PROBLEM DEFINE CLEAR STAKES AND OPPORTUNITY UNDERSTAND USER SEGMENTS DEFINE USER PROFILES MAP USER JOURNEYS DISCOVER USER FRICTIONS BRING PEOPLE TOGETHER PROTOTYPE WITH CUSTOMERS DIRECT EXPERIENCE CREATE URGENCY HAVE A VALIDATED IDEA DEFINE THE WORK STREAMS BUILD THE ESSENTIAL FEATURE TEST UP TO 20 USERS ADD BRAND, FRONT END & DESIGN CONDUCT IN THE FIELD ALIGN TO THE ORGANIZATION TEST AT LEAST 100 USERS
  42. 42. EXPERTISE FOCUS AREA STAGE TOOLS USER TYPES MENTAL APPROACH User Experience User Pains and Gains Problem Solution Fit Lean Value Proposition Canvas Recruits Discovery Product Management Viability Product Market Fit Minimum Viable Product and Lean Canvas Early Adopters Validation Marketing Traction and Profitability Distribution Conversion Fit Advertising Mass Audience Growth
  43. 43. CHALLENGES What does trouble look like?
  44. 44. Innovation Challenges #How to Find Inspiration for Product Innovation By using research and creative thinking techniques you can unlock powerful starting points for your next remarkable product creation. #How to Know if Your Product Idea is any Good Validating your idea with real customers can help you understand when and how an idea can be successful. #How to Get from a Good Idea to a Great Product An agile process and alignment with modelling, operations and marketing will make the journey of product design possible. #How to Avoid a Product that Nobody Wants By increasing the rate of learning and moving at speed, you’ll maximize ability to create an innovation, not an invention.
  45. 45. Questions for generating creative ideas What's the opposite way to how everyone currently does it? What if we could not include instructions? What can we make invisible to the user? What if users could only use the product for 60 seconds a day? How can we make the most boring part of the product delightful? How could the product get better the more that people use it? How to Find Inspiration for Product Innovation Mantras for generating innovation insights Discover what keeps people up at night Discover what brings a smile to people’s faces Discover what people are missing in their life Make a product with one feature Make something ten times better than today's best option Make your product like AirBnB would
  46. 46. • Do a quick survey to our existing customers and send out via Facebook or newsletter • Do an in-depth home interview with customers • Read a industry and customer trends report • Review your competition • Invite customers to co create with you • Review customer feedback and complaints • Run smart reports on your data • Be a mystery shopper Mike’s Emergency Inspiration List
  47. 47. #Things to Watch Positive response to prototypes; nodding, energetic hand movements, Negative response to prototypes: Sighs, reluctance, hesitant How to Know if Your Product Idea is any Good #Things to Ask How much would they pay? How would you tell a friend? #Basic Sprint Exercises Role play a scenario Card sorting and prioritization Show a user journey Make a a paper/cardboard prototype
  48. 48. A closed card sort — participants sort items into categories you give them
  49. 49. Materials Every workshop will have some custom materials, here are the essentials for each trolley per team; • Black /White XL foam boards • Post it notes: 4-6 colours • Tape • White board markers • Pens • Pencils • Scissors • Ruler • String • A5 Card • A4 Paper • Transparent plastic sheets A4 • String • Paper clips • Rubber bands • Name stickers for guest customers • Small coloured dot stickers
  50. 50. Tools Tape Pens & Pencils Scissors Ruler String A5 Card A4 Paper Black /White XL foam boards Post it notes: 4-6 colors White board markers Sketch InVision Adobe XD iPad Laptop
  51. 51. Types and Scenarios JOURNEY Poster Transaction Customer support DIAGNOSTIC Interview Role Play Card Sorting EXPERIENCE Onboarding Feature Product
  52. 52. Types and Scenarios DIAGNOSTIC Interview What was the most stressful part of getting a mortgage? Role Play Let’s re-create the painful call to the call the centre Card Sorting Take these 20 cards and rank them from pleasant to stressful experiences and tell us why JOURNEY Poster Let’s test 5 different propositions for the mortgage and discover which one is the most appealing Transaction Let’s test the two very different ways of asking for the loan information Customer support Let’s try customer calls with three different scripts for the agent EXPERIENCE Onboarding Let’s try a visual progress bar in the app to make the experience more transparent Feature Let’s try giving expert advice in the chat interface Product Let’s try integrating the loan calculator and chat in one experience
  53. 53. 778594
  54. 54. 778594
  55. 55. Direct Experience
  56. 56. Listen
  57. 57. Hustle
  58. 58. Start with the important stuff Most development teams traditionally start with the login and all the on boarding experience. This often leads to a situation where the development team are a half way through the timeline and haven’t really build the core functionality. Align your business with your product Finances and cash, Marketing, legal & finance, Process and standardizations, Vendors and partners Make Sure Your Idea is Validated A good idea is a concept that has been validated. That means you’ve done some objective verification of the idea. Create a small team and go fast Minimum weekly sprints Mon: design and dev brief Thu/Wed: build Thu: test and learn Fri: refine and test How to Get from a Good Idea to a Great Product
  59. 59. Waterfall Approach Prioritization Approach PRIMARY FEATURE (always under estimated) UTILITIES (common practice) A Z (follows user journey)
  60. 60. Endowment Effect and Avoiding Failure Customers value what they have. And they don’t like change. When thinking about new products the “switching costs” weigh heavier than the potential benefits. This means a new product must be remarkable in order to succeed. Ten times better than today. Companies also value what they have. They fall in love with their creations. They become blind to the customer truth: the customer see’s more loses than gains. And thats why most new products fail.
  61. 61. LOW HIGH How to Avoid a Product that Nobody Wants AMOUNT OF BEHAVIOUR CHANGE REQUIRED FAIL QUICK-FIX HARD WORK INNOVATION iPHONEXIAOMI IRIDIUM, FIRE, KIN BLACKBERRY LOW HIGH USER BENEFITS
  62. 62. More Benefits, Less Change Amount of Behaviour Change Required Time Money Effort Brain Cycles Social Deviance My Routine User Benefits Simplicity Mobility Affordability More personal time Wellness Freedom Higher performance Fulfilment Impact
  63. 63. Innovation is hard. It's a journey into the unknown. It's equal parts art and science. Leading innovation projects demands buckets of courage and endless rigor. If you stay the course and cross the finish line, the rewards are worth it.
  64. 64. Thank you
  65. 65. FUTURE HORIZONS5 EMERGING TECHNOLOGIES AND HOW NOT TO MESS THEM UP
  66. 66. WE LIVE IN exciting TIMES
  67. 67. 1440 PRIN TIN G PRESS 1927 TELEVISION 1876 TELEPHONE 1712 STEAM TRAIN 1971 MICROPROCESSOR 1990 WORLD WIDE WEB 2007 IPHONE
  68. 68. 2017 GDP PER CAPITA EMERGING TECHNOLOGY INNOVATION 1440 PRIN TIN G PRESS
  69. 69. Every two days now we create as much information as we did from the dawn of civilization up until 2003 ERIC SCHMIDT, GOOGLE
  70. 70. ICO’s 100X 30M Alexa’s 17% adoption
  71. 71. WHAT’S NEXT?
  72. 72. User Wow! Addressable Market. Openness to innovate
  73. 73. LET’S PICK SOME WINNERS
  74. 74. 1. AUGMENTED REALITY EMERGING TECHNOLOGY FOR TOMORROW
  75. 75. VOLVO 3D TV
  76. 76. Insert
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  78. 78. Insert
  79. 79. Insert
  80. 80. 2. AUTONOMOUS VEHICLES EMERGING TECHNOLOGY FOR TOMORROW
  81. 81. TESLA UBER
  82. 82. Insert
  83. 83. Insert
  84. 84. Insert
  85. 85. 3. FACE RECOGNITION EMERGING TECHNOLOGY FOR TOMORROW
  86. 86. KFC GOVERNMENT
  87. 87. Insert
  88. 88. Insert
  89. 89. Insert
  90. 90. Insert
  91. 91. 4. IOT EFFECT EMERGING TECHNOLOGY FOR TOMORROW
  92. 92. RIO TINTO EMBERLIGHT
  93. 93. Insert
  94. 94. 5. ARTIFICIAL INTELLIGENCEEMERGING TECHNOLOGY FOR TOMORROW
  95. 95. GOOGLE & IBM AMAZON
  96. 96. Insert
  97. 97. MEET OLIVER HABERSTRO
  98. 98. BUT…
  99. 99. TEST & LEARN
  100. 100. PAINS & GAINS
  101. 101. BE MORE HUMAN
  102. 102. THANK YOU

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