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MATRIX Business Agility Seminar June 2019
Design thinking and rapid prototyping enable organizations to innovate like startups. Companies that invest in design outperform peers, but many companies are slow to adopt these practices. Business agility requires a holistic approach where principles are applied flexibly based on an organization's unique needs, with a focus on mindset change over rigid processes. Innovation depends on understanding problems through collaboration and experimentation.
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MATRIX Business Agility Seminar June 2019
- 1. Business Agility andInnovation through Design Thinking
- 2. Greetings 2 ©2018 MATRIX Resources,Inc. Gervais (Jay) Johnson Sr. Director, National Agile Practice at MATRIX
- 3. Question: What is BusinessAgility to you?
- 4. Why 4 ©2018 MATRIX Resources,Inc. A study from Harvard Business Review Analytic Services and the Genpact Research Institute found the biggest obstacle to accelerating the pace and impact of digital transformation is the inability to experiment quickly. Design thinking and rapid prototyping enable even the largest enterprises to innovate like start-ups and to develop breakthrough customer experiences. There are practical, business benefits to this approach. According to a 2014 assessment by the Design Management Institute, design-led companies like Apple, IBM, Nike, and Whirlpool outperformed the S&P 500 over the past 10 years by 219 percent. IDC says that banks which ignore digital transformation will perish. Forrester research found that only 18% of U.S. brands provide good or excellent customer experiences.
- 5. Business Agility 5 ©2018 MATRIXResources, Inc. 1. Employee Happiness – Individual and Networked, Collaborative and Accountable, Engaged and Introspective 2. Customer Delight – Exponential Change with customer part of the Organization Ecosystem 3. Learning Community – Safe to Unlearn and Leadership as a Service 4. Disrupting Stability – Create, Grow, Balance, Reinvent, Always Relevant 5. Social Purpose and Meaningful Culture – The Giveback Brand Smartest Person in the Room is the Room
- 6. The Age ofAgile 6 ©2018 MATRIX Resources, Inc. 1. Law of the Small Team 2. Law of the Customer 3. Law of the Network Agile management is at odds with much of what is practiced in public corporations and taught in business schools
- 7. Business Agility =New Organization Creating Culture 7 ©2018 MATRIX Resources, Inc.
- 8. Business Agility Personality 8 ©2018MATRIX Resources, Inc. Traits: • Building the Right-Thing – Customer Value. • Building the Thing-Right – Excellent Customer and Business Outcome. • Building at the Right-Speed – Exceeding Customer Demand. Highly engaged people relentlessly focused on customer value, continuously improve operations using empiricism while swiftly embracing change within a sustainable business model.
- 9. Business Agility isHolistic 9 ©2018 MATRIX Resources, Inc. Ways of Working: • Principles based to allow for case by case flexibility. • Applicable holistically without pre-determined application. • Focuses on mindset change first, as opposed to detailed process adoption. The approach of adopting a unique set of Enterprise-based Agile values and principles to an organization’s holistic needs. (as opposed to those of only technology based solutions.)
- 10. Business Agility =Innovation and Stability 10 ©2018 MATRIX Resources, Inc.
- 11. Question: What is DesignThinking to you?
- 12. Design Thinking 12 “Design thinkingis a human-centered approach to innovation that draws from the designer's toolkit to integrate the needs of people, the possibilities of technology, and the requirements for business success.” Tim Brown, CEO of IDEO “Design is the process of understanding customer needs and then creating a product or service—physical, digital, or both—that addresses their unmet needs.” McKinsey & Company ©2018 MATRIX Resources, Inc.
- 13. Design Thinking 13 “Design thinkingis a user-centered approach to problem solving that fosters innovation, which provides competitive advantage, and competitive advantage can make it rain.” Ryan Wright, MATRIX “Design is the human centric and analytically informed innovation across physical, digital, and service solutions resulting in business success and social impact.” Gervais Johnson, MATRIX ©2018 MATRIX Resources, Inc.
- 14. Examples of Companiesthat Perform Design Thinking Very Well…. 14 ©2019 MATRIX Resources, Inc.
- 15. Most companies 10-20years behind 15 “The S&P 500 companies that invested most into design processes, capabilities, and leadership over the past decade, including design stalwarts such as Disney, Nike, and P&G, outperformed the rest of the index by 211 percent. What our research demonstrates, however, is that many companies have been slow to catch up. Over 40 percent of the companies surveyed still aren’t talking to their end users during development. Just over 50 percent admitted that they have no objective way to assess or set targets for the output of their design teams.” McKinsey & Company, Business Value of Design Study ©2018 MATRIX Resources, Inc.
- 16. What is DesignThinking?
- 17. What Does DesignThinking Accomplish in an Organization? • Cultivates Curiosity • Encourages experimentation early and often • Requires collaboration across silos • Spreads ideas like a virus • “Go big and go fast”
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- 20. Design and AgileConvergence 20 Discovery and Delivery Agile and UX
- 21. Design and SCRUM 21 “Together we’ve been working to build a framework that spells out — step by step — how scrum and UX design integrate. One exercise we did individually was to overlay UX and Design activities on top of a well- founded model of scrum. The diagram is my attempt at that exercise.” Jeff Gothelf & Josh Seiden
- 22. Design and LeanUX 22
- 23. Design and LeanCanvas 23
- 24. Design is acritical part of a successful organization 24 According to the IBM 2017 Global C-suite Study, "Organizations of all sizes are prioritizing personalized customer experiences. The enterprises that most effectively deliver on this imperative are using design thinking to manage complexity, orchestrate across channels and truly understand their customers’ motivations.” IBM 2017 Global C-suite Study
- 25. DESIGN IS AGILEAND AGILE IS D ES I G N ©2018 MATRIX Resources, Inc.
- 26. Key elements ofa great design organization 26 • Cross Functional Teams • Interdisciplinary Team Members • Team Garage Space • Cultural Phenomenon • Customer Centric ©2018 MATRIX Resources, Inc. • Technology & Engineering Leadership • Continuous Design • Qualitative and Quantitative • Analytical Decisions • Experimentation and Prototypes • Design and Outcome Measurements
- 27. Question: How is Designexecuted within your company?
- 28. Design Thinking AtApple 28 After Steve Jobs returned to Apple in 1997 (upon Apple’s acquisition NeXT), he started to apply the design thinking characteristics discussed above, which reflected his vision for Apple products. The vision discussed below was used to form Apple’s strategy from 1997 until today. Steve Jobs applied design thinking by focusing on: • People’s needs and desires, rather than only the needs of the business • Building empathy by helping people to love Apple products • The design rather than the engineering work; designers consider both the form and the function of the product • Building simple yet user-friendly products rather than complex hard-to-use products
- 29. Design Thinking AtApple 29 “Most people make the mistake of thinking design is what it looks like. People think it’s this veneer — that the designers are handed this box and told, ‘Make it look good!’ That’s not what we think design is. It’s not just what it looks like and feels like. Design is how it works.” Steve Jobs ©2018 MATRIX Resources, Inc. Reference http://creativeselection.io/ https://www.designorate.com/design- thinking-case-study-innovation-at- apple/
- 30. Design Thinking AtAmazon 30 Amazon eCommerce Amazon Web Services Amazon Alexa Amazon Fresh They have a track record of delivering breakthrough experiences which creates disruption opportunities. You can learn more about Amazon’s experimentation culture and why Jeff Bezos says, “It is always day 1 here” Forbes has written about the 12 major industries which Amazon has disrupted and/or is trying to disrupt. ©2018 MATRIX Resources, Inc.
- 31. Design Thinking atPepsiCo 31 “To a certain extent. When you’re a CEO, you can’t break too many stereotypical expectations. I wish you could, but you can’t. In those days, there was a well-defined conservative stereotype, so everything I did was breaking the framework. I played in a rock band. I climbed trees. I did stuff that made my parents wonder, “What the hell is she doing?” But I also was a good student and a good daughter, so I never brought shame on the family. And I was lucky that the men in my family thought the women should have an equal shot at everything. I’m still a bit of a rebel, always saying that we cannot sit still. Every morning you’ve got to wake up with a healthy fear that the world is changing, and a conviction that, to win, you have to change faster and be more agile than anyone else.” Indry Nooya ©2018 MATRIX Resources, Inc.
- 32. Design Thinking atPepsiCo 32 “There’s a fine line between innovation and design. Ideally, design leads to innovation and innovation demands design. We’re just getting started. Innovation accounted for 9% of our net revenue last year. I’d like to raise that to the mid teens, because I think the marketplace is getting more creative. To get there, we’ll have to be willing to tolerate more failure and shorter cycles of adaptation.” Do you feel that companies have to reinvent themselves every few years, that competitive advantage is fleeting? “No question about it. It’s been a long time since you could talk about sustainable competitive advantage. The cycles are shortened. The rule used to be that you’d reinvent yourself once every seven to 10 years. Now it’s every two to three years. There’s constant reinvention: how you do business, how you deal with the customer.” Indra Nooya ©2018 MATRIX Resources, Inc. Reference http://design.pepsico.com/ https://hbr.org/2015/09/how-indra- nooyi-turned-design-thinking-into- strategy
- 33. Design Thinking atIntuit 33 “In a very short period of time they learned that many more people were interested in buying just one seat, or three seats. As a result, after further testing, they changed their policy to sell individual and smaller numbers of seats. What was the result of this small customer-centric, quick prototype test? A $10 million increase in sales in the first year.” “Intuit’s finance organization recognized that 25% of their customers didn’t update their credit cards in time and were cut off from service……the group ran a series of small experiments on how to keep contact information up-to-date and to find better ways to communicate with their customers. The company estimates recovering approximately $8 million a year in lost revenue, simply by improving communication and engagement with customers in keeping billing information up-to-date.” ©2018 MATRIX Resources, Inc.
- 34. Question: How is innovationpart of your way of working?
- 35. Technology Epic Failures 35 ©2018MATRIX Resources, Inc.
- 36. Technology Epic Failures 36 ©2018MATRIX Resources, Inc.
- 37. Technology Innovation Philosophy 37 ©2018MATRIX Resources, Inc.
- 38. Innovation/Invention Depends onProblem 38 I found that every innovation strategy fails eventually, because innovation is, at its core, about solving problems — and there are as many ways to innovate as there are types of problems to solve. • Facebook Hacker Week • Google Innovation Think Day • Intuit Innovation Day • Multiple Company Innovation Centers ©2018 MATRIX Resources, Inc. Reference https://hbr.org/2017/06/the-4-types- of-innovation-and-the-problems-they- solve
- 39. Business Agility /Design + Cynefin Complexity Framework 39 ©2018 MATRIX Resources, Inc.
- 40. Innovation from CustomerCollaboration and Validation 40 Customer Development is a four-- -step framework developed by Steve Blank to discover and validate that you have identified the market for your product, built the right product features that solve customers’ needs, tested the correct methods for acquiring and covering customers, and deployed the right resources to scale the business. ©2018 MATRIX Resources, Inc. Reference https://kickbox.adobe.com/
- 41. Innovation Aligned toCompany Life 41 ©2018 MATRIX Resources, Inc. Initiation Expedition Formation Validation Stabilization Acceleration Crystallization Expansion Conservation Finish By Jurgen Appelo
- 42. Business Agility Ecosystem 42 ©2018MATRIX Resources, Inc.
- 43. Business Agility isHolistic 43 ©2018 MATRIX Resources, Inc. “IT needs to move faster” “Legal needs to participate more” “Audit needs to be more flexible” “Delivery and Support are not in sync ” “More HR Support is needed” A Holistic Agile approach recognizes there are individual issues but starts with the whole organization in mind in order to improve every part as opposed to just one. Holistic Agile principles are also designed to be utilized in every part of the organization regardless of interaction with IT.
- 44. References 44 ©2018 MATRIX Resources,Inc. https://businessagility.institute/ The Age of Agile by Stephen Denning Mapping Experiences by Jim Kalbach Designing the Invisible by Lara Penin Branded Interactions by Marco Spies Innovators Dilemma by Clayton Christensen Management 3.0 by Jurgen Appelo Startup. Scaleup, and Screwup by Jurgen Appelo
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- 46. Thanks for attendingtoday’s Seminar! 46 Be on the lookout for an email with a link to access the slide deck. Send any additional questions to Gervais.johnson@matrixres.com. ©2018 MATRIX Resources, Inc.