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Creating an Agile Business
- Creating an Agile Business Mile High Agile
- Zach Nies @zachnies Zach Nies, Chief Technologist Rally Software zach.nies@rallydev.com
- Font Sampler http://en.wikipedia.org/wiki/File:Caslon-schriftmusterblatt.jpeghttp://media.kelbymediagroup.com/layersmagazine/images/columns/artoftype/may06/glyph-set.jpg
- I love to change industries
- Apply new disciplines
- Become disciplined explorers…
- who know how to balance exploration and execution
- Build what people want
- Create a viable business
- What happened to this company?
- 1 2 5 iPhone Released 1 iPhone App SDK Released 2 Android w/ Nav Released 5 Major Recession 3 3 TomTom iPhone App 4 4
- A lot can ! happen in ! 1 year.!
- The characteris3cs of innova3on are changing
- Is your business Agile enough?!
- Turn these disruptions into opportunities!
- What’s changing?
- Technology adop3on
- hAp://upload.wikimedia.org/wikipedia/en/4/45/DiffusionOfInnovaKon.png
- hAp://upload.wikimedia.org/wikipedia/en/4/45/DiffusionOfInnovaKon.png
- What if…!
- hAp://upload.wikimedia.org/wikipedia/en/4/45/DiffusionOfInnovaKon.png
- hAp://hbr.org/2013/03/big-‐bang-‐disrupKon/
- Disrup3on has a bigger impact
- Time to excellence
- hAp://en.wikipedia.org/wiki/File:DisrupKvetechnology.gif
- hAp://en.wikipedia.org/wiki/File:DisrupKvetechnology.gif Excellence!
- Some examples…!
- 1984!
- 2006!
- About 20 years!
- 2001!
- 2006!
- 5 years!
- 2007!
- 2010!
- 3 years!
- 2010!
- 2012!
- 2 years!
- 2008!
- 2012!
- 4 years!
- 1979!
- 1989!
- 10 years!
- 5 years!
- 2.5 years!
- 1.5 years!
- Disrup3on can sneak up on you
- Impact on companies
- 500
- Question:! ! How long does the average company on this list survive?!
- 1958: ! Average lifespan was 61 years! ! 2012: ! Average lifespan was 18 years!
- Market churn creates uncertainty
- Your business needs to become more Agile
- Don’t fall off the commitment cliff
- CostValue Time Value Value of commitment – Normal!
- CostValue Time Value Opp Cost Value of commitment – Normal!
- CostValue Time Value Opp Cost Total Value Value of commitment – Normal!
- CostValue Time Value Opp Cost Total Value Optimal commitment! Value of commitment – Normal!
- Value of commitment – High Uncertainty!
- CostValue Time Value Value of commitment – High Uncertainty!
- CostValue Time Value Opp Cost Value of commitment – High Uncertainty!
- CostValue Time Value Opp Cost Total Value Value of commitment – High Uncertainty!
- CostValue Time Value Opp Cost Total Value Optimal commitment! Value of commitment – High Uncertainty!
- An example…!
- CostValue Time Value Opp Cost Total Value Ability to respond! Optimal commitment!
- CostValue Time Value Opp Cost Total Value Ability to respond! Fastest Response?!
- Agile teams & organiza3on
- Steering vs. Planning
- Technology adop3on is a human phenomenon
- Not a technological phenomenon
- An example…!
- Tribes are more connected
- Change creates uncertainty
- Chaotic! Simple!Complicated!Complex! Uncertainty!
- Take Action! Follow Rules! Analyze! Guess & Learn! Chaotic! Simple!Complex! Complicated! Uncertainty!
- Take Action! Follow Rules! Analyze! Guess & Learn! Chaotic! Simple!Complex! Complicated! Bureaucrat!Engineer!Firefighter! Entrepreneur! Uncertainty!
- Take Action! Follow Rules! Analyze! Guess & Learn! Chaotic! Simple!Complex! Complicated! Firefighter! Bureaucrat!Engineer!Entrepreneur! Uncertainty!
- E x p l o r e E x e c u t e Uncertainty!
- E m e r g e A n a l y z e Uncertainty!
- E x p e r i m e n t P l a n Uncertainty!
- Chaotic! Simple!Complicated!Complex! Product lifecycle!
- Chaotic! Simple!Complicated!Complex! Product lifecycle!
- Chaotic! Simple!Complicated!Complex! Product lifecycle!
- Chaotic! Simple!Complicated!Complex! Product lifecycle!
- Chaotic! Simple!Complicated!Complex! Disruption! Product lifecycle!
- Chaotic! Simple!Complicated!Complex! Disruption! Product lifecycle!
- Naviga3ng uncertainty
- Discovering demand Amplifying engagement
- hAp://www.flickr.com/photos/isaacmao/380257543 Create a plan to predict the future!
- Market research! Product definition! Product requirements! Detailed plan! Alpha release! Beta release! Final release! FIRST CONTACT WITH CUSTOMERS!
- Market research! Product definition! Product requirements! Detailed plan! Alpha release! Beta release! Final release! FIRST CONTACT WITH CUSTOMERS!
- Market research! Product definition! Product requirements! Detailed plan! Alpha release! Beta release! Final release! FIRST CONTACT WITH CUSTOMERS!
- Market research! Product definition! Product requirements! Detailed plan! Alpha release! Beta release! Final release! FIRST CONTACT WITH CUSTOMERS!
- Market research! Product definition! Product requirements! Detailed plan! Alpha release! Beta release! Final release! FIRST CONTACT WITH CUSTOMERS!
- Market research! Product definition! Product requirements! Detailed plan! Alpha release! Beta release! Final release! FIRST CONTACT WITH CUSTOMERS!
- Market research! Product definition! Product requirements! Detailed plan! Alpha release! Beta release! Final release! FIRST CONTACT WITH CUSTOMERS!
- HOW MANY GUESSES?!
- FIRST CONTACT WITH POTENTIAL CUSTOMERS!
- hAp://www.flickr.com/photos/oregondot/4132135156
- Obscure the uncertainty with details!
- Embrace and reveal the uncertainty!
- Sounds like a startup!
- How does Eric Ries define a Lean Startup?!
- Where does uncertainty live?
- Brown, Tim (2009-‐09-‐16). Change by Design (Kindle LocaKon 1984). Harper Collins, Inc.. Kindle EdiKon.
- Where are you?
- Brown, Tim (2009-‐09-‐16). Change by Design (Kindle LocaKon 1984). Harper Collins, Inc.. Kindle EdiKon.
- Brown, Tim (2009-‐09-‐16). Change by Design (Kindle LocaKon 1984). Harper Collins, Inc.. Kindle EdiKon. Level of uncertainty
- Type of innovation Sustaining Brown, Tim (2009-‐09-‐16). Change by Design (Kindle LocaKon 1984). Harper Collins, Inc.. Kindle EdiKon.
- When to explore vs execute?
- What to do Brown, Tim (2009-‐09-‐16). Change by Design (Kindle LocaKon 1984). Harper Collins, Inc.. Kindle EdiKon. Execute
- What to do Brown, Tim (2009-‐09-‐16). Change by Design (Kindle LocaKon 1984). Harper Collins, Inc.. Kindle EdiKon.
- What to do Big Companies Brown, Tim (2009-‐09-‐16). Change by Design (Kindle LocaKon 1984). Harper Collins, Inc.. Kindle EdiKon.
- Big Companies hAp://www.flickr.com/photos/ironnickel/6076087519
- Startups hAp://www.flickr.com/photos/elcapitan/2387917709
- Example – Taxi Cabs
- hAp://www.flickr.com/photos/emilyrides/5048843409
- Brown, Tim (2009-‐09-‐16). Change by Design (Kindle LocaKon 1984). Harper Collins, Inc.. Kindle EdiKon.
- Discover the future! Validate!Discover! Transition! Business Model! Vision and Empathy! Frame Measure Build Learn Frame Measure Build Learn Frame Measure Build Learn Frame Measure Build Learn Frame Measure Build Learn
- “Get out of the building!”! Steve Blank!
- “Meaning emerges through interaction”! Dave Snowden!
- Vision and Empathy! Discover the future!
- hAp://www.flickr.com/photos/klearchos/4541072707 Vision!
- The idea is NOT the only thing that matters.
- What does matter? According to Simon Sinek
- hAp://www.flickr.com/photos/usarmyafrica/4553749920 Empathy!
- hAp://www.flickr.com/photos/skillerphotos/7875656716
- Discover the future! Business Model! Vision and Empathy!
- Business Model!
- 1 234 5 67 8 9
- Example – iPod
- hAp://www.flickr.com/photos/75001512@N00/4683351383 Walkman for the digital age Design, Manufacturing, Marketing, Support + Margin & Profit hAp://www.flickr.com/photos/mrmonochrome/93535053
- Discover! Discover! Business Model! Vision and Empathy!
- Discover! Problem Discovery! We understand the problem a customer wants solved! Discover!
- Customers don’t care about your solution. They care about their problems. “ Dave McClure
- hAp://www.flickr.com/photos/adacKo/2535502416
- Typical market research: Customer attributes
- hAp://www.flickr.com/photos/serpicolugnut/172616929
- Innovation market research: Customer circumstances
- hAp://www.flickr.com/photos/icanchangethisright/3195180388
- hAp://www.flickr.com/photos/twostoutmonks/664314897
- What job is your solution being hired to perform? Milkshake Test
- hAp://www.flickr.com/photos/icanchangethisright/3195180388
- hAp://www.flickr.com/photos/twostoutmonks/664314897
- Competition
- hAp://www.flickr.com/photos/16339684@N00/2498270160 hAp://www.flickr.com/photos/nkarim/6761890929
- hAp://www.flickr.com/photos/icanchangethisright/3195180388
- hAp://www.flickr.com/photos/jorgebrazil/2421696121 hAp://www.flickr.com/photos/like_the_grand_canyon/5661863401
- hAp://www.flickr.com/photos/twostoutmonks/664314897
- hAp://www.flickr.com/photos/makelessnoise/333188801
- hAp://www.flickr.com/photos/rodrigofavera/2636733253
- Discover! Solution Validation! Our product idea solves the customer’s problem! Discover!
- Test a low fidelity Minimum Viable Product
- Goal: Get real feedback without building a real product
- How?
- Video Demo (Landing Page) Concierge Wizard of Oz Crowd Funding Single Key Feature
- Video Demo (Landing Page) Concierge Wizard of Oz Crowd Funding Single Key Feature
- Create a real product experience with the least effort possible
- The MVP…
- hAp://www.seanpercival.com/blog/2012/10/21/pre-‐inventory-‐startups/ Delivering Happiness: A Path to Profits, Passion, and Purpose By Tony Hsieh
- Discover! Business Validation! Our business model can be profitable! Discover!
- High level business model hAp://www.forentrepreneurs.com/saas-‐metrics/
- Discover the future! Business Model! Vision and Empathy! Pivot or Persevere?!
- Validate! Validate! Business Model! Vision and Empathy!
- Validate! Prepare to Sell! The founders can: Understand the flow of money and sell the offer! Validate!
- You ?
- Find Earlyvangelists
- Validate! Close Deals! Our draft sales plan will close or activate customers! Validate!
- Sales Funnel hAp://www.flickr.com/photos/carlagates247/5524789016
- Activation Funnel hAp://www.flickr.com/photos/500hats/577630547
- Validate! Package Offer! We can package, price, position and promote our offer! Validate!
- For (target customers) Who (have the following problem) The (product name) is a (describe the product or solution) That provides (key benefit) Unlike (reference competition), The product/solution (describe the key point of competitive differentiation) Product Positioning
- Discover the future! Business Model! Vision and Empathy! Pivot or Persevere?!
- Discover the future! Transition! Business Model! Vision and Empathy!
- Transition! Transition Team! We have budget and a cross departmental transition team! Transition!
- Managing a Porcolio The Three Horizons Model Horizon 1 0 to 12 months Horizon 2 12 to 36 months Horizon 3 36 to 72 months Current Businesses Generate today’s cash flow High Growth Businesses Today’s revenue growth + tomorrow’s cash flow Growth OpKons OpKons on future high-‐growth businesses Expected Window of Returns Accumulated Total Returns Figure 2.4
- 20% time or separate H3 groups? Dedicated H2 transition
- Four Modes of Execution Execution Mode Invention Deployment Optimization Transitions Type of Leader Visionary Inventor Pragmatic Deployer Conservative Optimizer Pragmatic Orchestrator Core Competence Creativity Competitiveness Control Collaboration Core Attribute Spontaneous Tough-minded Prepared Empathetic Decision Style Intuition Experimentation Deliberation Consensus Functions Most in Alignment R&D, Creative Services Sales, Engineering Finance, Operations HR, Marketing, Customer Suppt Figure 6.4
- Transition! Integrate into Depts! Transition! Departments can take on our new offer!
- From Exploration to Execution hAp://www.flickr.com/photos/mckaysavage/497593758
- Inventors Inventor to department transition
- Orchestrator Inventors Deployers Departments Inventor to department transition
- Orchestrator Inventors Deployers Departments Inventor to department transition
- Orchestrator Inventors Deployers Departments Inventor to department transition
- Orchestrator Inventors Deployers Departments Inventor to department transition Product Engineering Sales Marketing
- Orchestrator Inventors Deployers Departments Inventor to department transition Product Engineering Marketing Sales
- Orchestrator Inventors Deployers Departments Inventor to department transition Product Engineering Marketing Sales
- Validate! Roll off Inventors! We no longer need our inventors on the team! Transition!
- Orchestrator Inventors Deployers Departments Inventor to department transition Product Engineering Marketing Sales
- Orchestrator Inventors Deployers Departments Inventor to department transition Product Engineering Marketing Sales
- Orchestrator Inventors Deployers Departments Inventor to department transition Product Engineering Marketing Sales
- Departments Inventor to department transition Product Engineering Marketing Sales
- Discover the future! Validate!Discover! Transition! Business Model! Vision and Empathy!
- Discover the future! Frame Measure Build Learn Frame Measure Build Learn Frame Measure Build Learn Frame Measure Build Learn Frame Measure Build Learn
- Guesses! Knowledge! Experiments!
- Empathize & Frame! Test & Measure! Build&Ship! Learn&Share! Experiments!
- TAKE EACH MAJOR GUESS
- RUN AN EXPERIMENT
- hAp://www.youtube.com/watch?v=Iyjs3zeoSrM
- hAp://www.richard-‐feynman.net/gallery.htm
- Feedback!
- Feedback!
- Feedback!
- Culture
- No blame or shame
- Democratize data
- Use quantitative and qualitative data
- Distribute decision making
- Diversity Independence Decentralization Aggregation
- Run small experiments
- hAp://www.flickr.com/photos/5wa/6400997231 Slack
- Discover the future! Validate!Discover! Transition! Frame Measure Build Learn Business Model! Vision and Empathy! Frame Measure Build Learn Frame Measure Build Learn Frame Measure Build Learn Frame Measure Build Learn
- Disciplined explora3on
- Extend Agility into your business!
- Take advantage of market opportunities!
- What happened to this company?
- 1 Began Using Lean Startup 1 2 $50M in New Product Revenue 2 3 1800 Concurrent Experiments 2
- Books that informed this talk
- Geoffrey Moore David Snowden Ash Maurya Tim Brown Clayton Christensen Steve Blank Eric Ries People who informed this talk Brant Cooper Patrick Vlaskovits
- hAp://www.flickr.com/photos/flaAop341/224597838