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Dr. Tobias Schimmer, Chief Expert, Design Thinking & Business Model Innovation, Products & Innovation, SAP SE
How Business Model Innovation intertwines with
Design Thinking and Agile Development practices
– Driving viability, desirability and feasibility in parallel…
© 2017 SAP SE or an SAP affiliate company. All rights reserved.
SAP’s Innovation Journey
3© 2017 SAP SE or an SAP affiliate company. All rights reserved.
© SAP 2015 | 4
2017
© SAP 2015 | 5
2009
© SAP 2015 | 6
2000
© SAP 2015 | 7
1998
© SAP 2015 | 8
1978
© SAP 2015 | 9
1972
© 2017 SAP SE or an SAP affiliate company. All rights reserved.
© SAP 2016 | 11 ALMOST	40	YEARS	OF	WATERFALL…
Source:	SAP
© 2017 SAP SE. All rights reserved. 12
“Back to the Roots”
Where do we want to go?
© 2017 SAP SE. All rights reserved. 13
Challenge: Customer-Centered Innovation on an Enterprise Scale
Approach:
Customer-
Centered
Goal: Innovation
© 2017 SAP SE. All rights reserved. 14
Rethinking Requirements Engineering and Project Management
fixed
estimated
Requirements
Requirements
Resources Release Date
Resources Release Date
Plan-driven (traditional) Value-driven (agile)
© 2017 SAP SE. All rights reserved. 15
Conduct regular
Retrospectives
Split organization
into teams
Split work
Split time
Deliver more
frequently
Deliver more
reliably and
predictably
Large-Scale Lean & Agile Development
Risk
Risk
© 2017 SAP SE. All rights reserved. 16
However, Lean & Agile Development starts with a Product Vision …
?
© 2017 SAP SE. All rights reserved. 17
… and we’re developing standard software for enterprise users
© SAP 2016 | 18
‘‘A developer needs to be curious
and develop empathy for end users”
© 2017 SAP SE. All rights reserved. 19
Step 2: Intertwining Agile Development and Design Thinking
© 2017 SAP SE. All rights reserved. 20
Impressions from an Innovation Workshop at SAP
© 2017 SAP SE. All rights reserved. 21
Results from an Innovation Workshop at SAP
© 2017 SAP SE. All rights reserved. 22
SAP’s Design Thinking Approach in Detail
© 2017 SAP SE. All rights reserved. 23
Lean, Agile, and Design Thinking Share a Common Set of Values
Project Example:
Co-Innovating in 'New Fashion Solution'
© 2017 SAP SE. All rights reserved. 25
We had our Customers Present the User Story Maps
© 2017 SAP SE. All rights reserved. 26
Tweaking Desirability: Design Thinking for Innovation Topics
Sprint-Size StoriesCoarse User Stories
e.g. Storyboards
User Story Maps
…and other sources Solution Backlog
NFS backlog
© 2017 SAP SE. All rights reserved. 27
NFS – a Role Model for Multi-Customer Co-Innovation?
§ User Story Mapping started and
improved overall communication
about end user requirements
§ Solution backlog management
process map ensured
transparency on progress-to-plan
with customers and enabled
program steering across teams
§ Design Thinking ensured
balancing of desirability,
feasibility and viability concerns
in solution definition and setup
phases…
End Users
NFS Customers SAP Development
SAP Solution Mgt.
© 2017 SAP SE. All rights reserved. 28
Finally, how do we Convert Product Ideas into Money?
© 2017 SAP SE or an SAP affiliate company. All rights reserved.
Why Worry about Business Models?
© 2017 SAP SE. All rights reserved. 30
Often, it‘s not about the product, but the business model
© 2017 SAP SE. All rights reserved. 31
Why worry about Business Models?
Same product, but #1 business model Attract many users, then leverage user data
Commercialize overcapacity à Web Services Disrupt an established market with new GTM
© 2017 SAP SE. All rights reserved. 32
Why should SAP Development worry about Business Models?
Industry Clouds
Business Networks Platform-as-a-Service
Internet of Things
© 2017 SAP SE or an SAP affiliate company. All rights reserved. 33
Product Design and Business Model Design happen in parallel
© 2017 SAP SE or an SAP affiliate company. All rights reserved.
What is a Business Model for us?
© 2017 SAP SE. All rights reserved. 35
Describe your Business Model Baseline
Network & Enterprise View
© 2017 SAP SE. All rights reserved. 36
SAP’s Classic Business Model – On Premise Business Suite
© 2017 SAP SE. All rights reserved. 37
© 2017 SAP SE. All rights reserved. 38
SAP’s Classic Business Model – On Premise Business Suite
© 2017 SAP SE or an SAP affiliate company. All rights reserved.
How does Business Model
Innovation work at SAP?
© 2017 SAP SE. All rights reserved. 40
Business Model Innovations at SAP – Some Recent Examples
Organizational Setup Requires Business Model
Innovations to be Managed Across Board Areas
© 2017 SAP SE. All rights reserved. 41
Business Model Innovation Lifecycle
“Business Model Library”
© 2017 SAP SE. All rights reserved. 42
Business Model Development & Innovation (BMDI™) Approach
Baseline Appropriate
Business Model
Version n Version n+1
© 2017 SAP SE. All rights reserved. 43
Analyze &
Improve
Challenge
& Change
Test & Verify
with MVPs
Evaluate
& Decide
w/ Business Case
Enterprise View = Business Model Canvas
Business Model Network View
Iterative Business Model Design with BMDI™
© 2017 SAP SE. All rights reserved. 44
How do Business Model Design & Design Thinking come together?
Bottom-up
Innovation
Top-down
Innovation
© 2017 SAP SE or an SAP affiliate company. All rights reserved.
Project Example: SAP Sports One
© 2017 SAP SE or an SAP affiliate company. All rights reserved.
Project Example: SAP Sports One
„Die Mannschaft“ (only parts of the overall team)
© 2017 SAP SE. All rights reserved. 47
How does DT & BMI make the difference (example Sports One)?
Design Thinking
Second level
Ÿ Third level
Ÿ …
Ÿ ...
Ÿ ...
We started with DesignThinking...
48© 2015 SAP SE or an SAP affiliate company. All rights reserved.
„Die Vision“
49© 2015 SAP SE or an SAP affiliate company. All rights reserved.
Involving Management from the Start
50© 2015 SAP SE or an SAP affiliate company. All rights reserved.
Typical
Worshop
Agenda
51© 2015 SAP SE or an SAP affiliate company. All rights reserved.
Business Network View
52© 2015 SAP SE or an SAP affiliate company. All rights reserved.
Business Model Canvas
53© 2015 SAP SE or an SAP affiliate company. All rights reserved.
Involving the entire Team regularly...
© 2017 SAP SE. All rights reserved. 54
How does DT & BMI make the difference (example Sports One)?
Design Thinking
Second level
Ÿ Third level
Ÿ …
Ÿ ...
Ÿ ...
Product Launch, Sports One, July 2015
© 2017 SAP SE. All rights reserved. 55
Summary of genuine Quotes on BMI & DT from SportsOne Team
“Overall, the BMI project
was key to keep
development, product
and solution management
in sync”
“…The BMI project helped to
shape and commercialize
an appropriate business
model for Sports One…”
“DT always inspired me! DT set a
fantastic structured environment
to create and develop ideas and to
find together as a team."
“…Iterative but fast
feedback loops possible as
teams were all on the same
“level” of understanding…”
© 2017 SAP SE or an SAP affiliate company. All rights reserved.
Conclusion
© 2017 SAP SE. All rights reserved. 57
Learned how to Change the Organization & Scale new Approaches
Improve ratio of
planning and
execution
Build quality into
products from
the inside out.
Incorporate
feedback
early and
regularly
Develop Coaches
within the
organization
© 2017 SAP SE. All rights reserved. 58
Status Quo – Today’s “Innovation Culture Mix” at SAP
Framework: William E. Schneider
© 2017 SAP SE. All rights reserved. 59
What we learned today - and what you might want to remember…
§ Lean, Agile, Design Thinking AND
Business Model Innovation practices
share a common set of values
§ In many cases DT starts with a focus on
desirability and software design
§ To make DT projects practicable,
feasibility and viability also need to be
taken in to account
§ Lean and Agile development philosophy
fits well with Design Thinking
§ Business Model Innovation forces big
corporations to act like startups again
© 2017 SAP SE or an SAP affiliate company. All rights reserved.
Thank you – Questions?
tobias.schimmer@sap.com

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How Business Model Innovation intertwines with Design Thinking and Agile Development practices – driving viability, desirability and feasibility in parallel

  • 1. Dr. Tobias Schimmer, Chief Expert, Design Thinking & Business Model Innovation, Products & Innovation, SAP SE How Business Model Innovation intertwines with Design Thinking and Agile Development practices – Driving viability, desirability and feasibility in parallel…
  • 2. © 2017 SAP SE or an SAP affiliate company. All rights reserved. SAP’s Innovation Journey
  • 3. 3© 2017 SAP SE or an SAP affiliate company. All rights reserved.
  • 4. © SAP 2015 | 4 2017
  • 5. © SAP 2015 | 5 2009
  • 6. © SAP 2015 | 6 2000
  • 7. © SAP 2015 | 7 1998
  • 8. © SAP 2015 | 8 1978
  • 9. © SAP 2015 | 9 1972
  • 10. © 2017 SAP SE or an SAP affiliate company. All rights reserved.
  • 11. © SAP 2016 | 11 ALMOST 40 YEARS OF WATERFALL… Source: SAP
  • 12. © 2017 SAP SE. All rights reserved. 12 “Back to the Roots” Where do we want to go?
  • 13. © 2017 SAP SE. All rights reserved. 13 Challenge: Customer-Centered Innovation on an Enterprise Scale Approach: Customer- Centered Goal: Innovation
  • 14. © 2017 SAP SE. All rights reserved. 14 Rethinking Requirements Engineering and Project Management fixed estimated Requirements Requirements Resources Release Date Resources Release Date Plan-driven (traditional) Value-driven (agile)
  • 15. © 2017 SAP SE. All rights reserved. 15 Conduct regular Retrospectives Split organization into teams Split work Split time Deliver more frequently Deliver more reliably and predictably Large-Scale Lean & Agile Development Risk Risk
  • 16. © 2017 SAP SE. All rights reserved. 16 However, Lean & Agile Development starts with a Product Vision … ?
  • 17. © 2017 SAP SE. All rights reserved. 17 … and we’re developing standard software for enterprise users
  • 18. © SAP 2016 | 18 ‘‘A developer needs to be curious and develop empathy for end users”
  • 19. © 2017 SAP SE. All rights reserved. 19 Step 2: Intertwining Agile Development and Design Thinking
  • 20. © 2017 SAP SE. All rights reserved. 20 Impressions from an Innovation Workshop at SAP
  • 21. © 2017 SAP SE. All rights reserved. 21 Results from an Innovation Workshop at SAP
  • 22. © 2017 SAP SE. All rights reserved. 22 SAP’s Design Thinking Approach in Detail
  • 23. © 2017 SAP SE. All rights reserved. 23 Lean, Agile, and Design Thinking Share a Common Set of Values
  • 24. Project Example: Co-Innovating in 'New Fashion Solution'
  • 25. © 2017 SAP SE. All rights reserved. 25 We had our Customers Present the User Story Maps
  • 26. © 2017 SAP SE. All rights reserved. 26 Tweaking Desirability: Design Thinking for Innovation Topics Sprint-Size StoriesCoarse User Stories e.g. Storyboards User Story Maps …and other sources Solution Backlog NFS backlog
  • 27. © 2017 SAP SE. All rights reserved. 27 NFS – a Role Model for Multi-Customer Co-Innovation? § User Story Mapping started and improved overall communication about end user requirements § Solution backlog management process map ensured transparency on progress-to-plan with customers and enabled program steering across teams § Design Thinking ensured balancing of desirability, feasibility and viability concerns in solution definition and setup phases… End Users NFS Customers SAP Development SAP Solution Mgt.
  • 28. © 2017 SAP SE. All rights reserved. 28 Finally, how do we Convert Product Ideas into Money?
  • 29. © 2017 SAP SE or an SAP affiliate company. All rights reserved. Why Worry about Business Models?
  • 30. © 2017 SAP SE. All rights reserved. 30 Often, it‘s not about the product, but the business model
  • 31. © 2017 SAP SE. All rights reserved. 31 Why worry about Business Models? Same product, but #1 business model Attract many users, then leverage user data Commercialize overcapacity à Web Services Disrupt an established market with new GTM
  • 32. © 2017 SAP SE. All rights reserved. 32 Why should SAP Development worry about Business Models? Industry Clouds Business Networks Platform-as-a-Service Internet of Things
  • 33. © 2017 SAP SE or an SAP affiliate company. All rights reserved. 33 Product Design and Business Model Design happen in parallel
  • 34. © 2017 SAP SE or an SAP affiliate company. All rights reserved. What is a Business Model for us?
  • 35. © 2017 SAP SE. All rights reserved. 35 Describe your Business Model Baseline Network & Enterprise View
  • 36. © 2017 SAP SE. All rights reserved. 36 SAP’s Classic Business Model – On Premise Business Suite
  • 37. © 2017 SAP SE. All rights reserved. 37
  • 38. © 2017 SAP SE. All rights reserved. 38 SAP’s Classic Business Model – On Premise Business Suite
  • 39. © 2017 SAP SE or an SAP affiliate company. All rights reserved. How does Business Model Innovation work at SAP?
  • 40. © 2017 SAP SE. All rights reserved. 40 Business Model Innovations at SAP – Some Recent Examples Organizational Setup Requires Business Model Innovations to be Managed Across Board Areas
  • 41. © 2017 SAP SE. All rights reserved. 41 Business Model Innovation Lifecycle “Business Model Library”
  • 42. © 2017 SAP SE. All rights reserved. 42 Business Model Development & Innovation (BMDI™) Approach Baseline Appropriate Business Model Version n Version n+1
  • 43. © 2017 SAP SE. All rights reserved. 43 Analyze & Improve Challenge & Change Test & Verify with MVPs Evaluate & Decide w/ Business Case Enterprise View = Business Model Canvas Business Model Network View Iterative Business Model Design with BMDI™
  • 44. © 2017 SAP SE. All rights reserved. 44 How do Business Model Design & Design Thinking come together? Bottom-up Innovation Top-down Innovation
  • 45. © 2017 SAP SE or an SAP affiliate company. All rights reserved. Project Example: SAP Sports One
  • 46. © 2017 SAP SE or an SAP affiliate company. All rights reserved. Project Example: SAP Sports One „Die Mannschaft“ (only parts of the overall team)
  • 47. © 2017 SAP SE. All rights reserved. 47 How does DT & BMI make the difference (example Sports One)? Design Thinking Second level Ÿ Third level Ÿ … Ÿ ... Ÿ ... We started with DesignThinking...
  • 48. 48© 2015 SAP SE or an SAP affiliate company. All rights reserved. „Die Vision“
  • 49. 49© 2015 SAP SE or an SAP affiliate company. All rights reserved. Involving Management from the Start
  • 50. 50© 2015 SAP SE or an SAP affiliate company. All rights reserved. Typical Worshop Agenda
  • 51. 51© 2015 SAP SE or an SAP affiliate company. All rights reserved. Business Network View
  • 52. 52© 2015 SAP SE or an SAP affiliate company. All rights reserved. Business Model Canvas
  • 53. 53© 2015 SAP SE or an SAP affiliate company. All rights reserved. Involving the entire Team regularly...
  • 54. © 2017 SAP SE. All rights reserved. 54 How does DT & BMI make the difference (example Sports One)? Design Thinking Second level Ÿ Third level Ÿ … Ÿ ... Ÿ ... Product Launch, Sports One, July 2015
  • 55. © 2017 SAP SE. All rights reserved. 55 Summary of genuine Quotes on BMI & DT from SportsOne Team “Overall, the BMI project was key to keep development, product and solution management in sync” “…The BMI project helped to shape and commercialize an appropriate business model for Sports One…” “DT always inspired me! DT set a fantastic structured environment to create and develop ideas and to find together as a team." “…Iterative but fast feedback loops possible as teams were all on the same “level” of understanding…”
  • 56. © 2017 SAP SE or an SAP affiliate company. All rights reserved. Conclusion
  • 57. © 2017 SAP SE. All rights reserved. 57 Learned how to Change the Organization & Scale new Approaches Improve ratio of planning and execution Build quality into products from the inside out. Incorporate feedback early and regularly Develop Coaches within the organization
  • 58. © 2017 SAP SE. All rights reserved. 58 Status Quo – Today’s “Innovation Culture Mix” at SAP Framework: William E. Schneider
  • 59. © 2017 SAP SE. All rights reserved. 59 What we learned today - and what you might want to remember… § Lean, Agile, Design Thinking AND Business Model Innovation practices share a common set of values § In many cases DT starts with a focus on desirability and software design § To make DT projects practicable, feasibility and viability also need to be taken in to account § Lean and Agile development philosophy fits well with Design Thinking § Business Model Innovation forces big corporations to act like startups again
  • 60. © 2017 SAP SE or an SAP affiliate company. All rights reserved. Thank you – Questions? tobias.schimmer@sap.com