Category Archives: Strategy

Think Like a Tech Company or Go Out of Business

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Think Like a Tech Company or Go Out of Business

by Braden Kelley and Linda Bernardi

Even in 2014, there are business sectors who feel they are not ‘tech companies’. News flash: Whether you are a consumer products company, an insurance company, a hotel, or a pharmaceutical company, your business is a technology business. Why?

Technology is the link between any business and its customers. To say technology is not core to your business strategy, means you think customers are not the key to your business success. So, your business is a technology business whether you want it to be or not.

Today technology is how you market and sell your products, make your business more efficient, and most importantly, how you stay connected to your customers. Some companies mistake the importance of technology to mean that they need to open a twitter account and monitor social media, put in an ERP and CRM system, and revamp their web site. But the importance of technology in today’s business environment is more than that.

ERP and CRM are common tools, a requirement to remain competitive, and while social media and the internet are important to sales and marketing success, they are becoming yesterday’s news as customers develop deeper connections to their mobile devices. If you aren’t on their devices and interacting in a meaningful way with them there in real-time, you won’t stay connected to them in the long run.

Let’s look at the impact on a few different industries whose members tend not to see themselves as technology companies:

1. Fortune 100 consumer product goods (CPG) companies
2. Hotel Chains
3. Big Box Retailers

1. Fortune 100 CPG companies typically manufacture large quantities of consistent products and have visually pleasing (static) web pages for consumers. But they don’t use technology well enough to detect what the market wants before it knows it, often fail to personalize or customize products to customer needs, and usually lack the online networks that could help connect other customer product needs together into new potential product ideas that the company could co-create with their customers. Often connection means post mortem analytics on data collected in the past, or, analyzing previous customer interactions with static web pages. Creating authentic customer connections requires online and mobile technology these companies usually don’t possess. I don’t mean apps (which often are pretty much the same as a website), but new physical/online/mobile engagement models that inspire customers to stay connected to the company (and each other) in a dynamic, evolving community. Rethinking is needed here. The customer is not just a buyer but an influencer. If CPG companies want to sell that next bottle of $300 facial cream, they better consider delighting, and not just marketing to, their customer base.

2. AirBnB has proven to be a major disruptive force in the hotel and hospitality business, grabbing a massive foothold in a market that the Homeaway.com member companies created and should have dominated. Resistance to AirBnB is massive and lawsuits are abundant, but for a moment let’s go beyond the hype and explore the angst of traditional hotels. AirBnB created a highly connected, effective community of property owners and property renters. This bi-directional ecosystem can only thrive if they are both happy and satisfied. To experience what they’ve created, first go to a traditional hotel website (pictures of room, building, lobby) and then go to AirBnB and browse the hundreds of customer experiences their property owners offer. On the hotel site you’ll see they’ve created the mechanics of paying to rent a hotel room, while on AirBnB you’ll see that they’ve created both an ecosystem and an experience.

3. Big box retailers have done a poor job of seeing themselves as technology companies capable of fending off challenges from online-only retailers. Target made the mistake of seeing themselves as a retailer, not a technology business, and so they outsourced their ecommerce to Amazon in the beginning, only to regret doing so because Amazon was able to learn which 20% of their inventory drove 80% of their profits, and when.

Meanwhile, Costco and Walmart, despite being two of the most successful retailers in the world, have struggled to find success online because they can’t get beyond their brick and mortar heritage to see themselves as a technology business with an integrated online/offline ecosystem. Seriously, it is 2014, do we still need to get our Costco circulars in the mail? Nothing has changed about Costco’s interaction with its customers. Walmart exacerbated the disconnection between the two sides of their business by creating a separate online division and exiling it to Silicon Valley. Costco sells different products online than offline. The results of both of these approaches have been far from stellar.

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Technology Lowers Barriers to Entry

In the history of the world, it has never been easier to start and scale a business to a global footprint, not in a matter of decades or years, but in months. And it is not just the other companies in your industry and technology-driven startups that you have to worry about if you choose not to view yourself as a technology company and move as fast as they do. You have to worry about competition from established technology players like Google and Amazon too, because one day they (or people that used to work for them) might decide that your market is attractive enough to enter and come disrupt your industry. For example, Amazon has become a book publisher and a financial services company.

Technology Enables Experiences

Technology enables the creation of customer experiences. I am going to choose my insurance company based on my experience. At the end of the day if all prices are comparable, then how the businesses you interact with make you feel, and the connections you’ve built with them will matter more. Without an emphasis on using technology to make your business a social business, you will find your company displaced by others that do. You must lead your industry in identifying opportunities to use technology to get closer to your customers. The future of business will be all about delighting customers and making their experience more personal.

Technology is not just a tool, but central to everything you do in today’s always on, always connected digital age.

Here are ten ways that technology can help you become a more social business:

  1. Building Connections
  2. Developing Networks
  3. Global Sensing and Prediction
  4. Sharing Recommendations
  5. Creating Experiences
  6. Personalization
  7. Customization
  8. Co-Creation
  9. Crowdsourcing
  10. Open Innovation

To give you an example of what things will look like in the future, the forward thinking health insurance company will leverage the mobile device for virtual ID cards, drug interaction warnings, personal triage, mobile care, wellness, cost sharing calculations, FSA/HSA administration, diagnostics, and more.

Conclusion

In conclusion, no matter what business you are in, it is very dangerous not to see technology as a competitive differentiator and a core driver of your business. Instead, you must constantly look at how you can become more of a technology company in order to enable deeper customer connections and more meaningful experiences. Today if you don’t connect with, understand, delight and start predicting your customer’s needs/wants, you may not thrive in your industry and your competition and new entrants who do embrace technology will replace you.

This article is brought to you by Linda Bernardi and Braden Kelley. Collectively, we have over 30 years of experience working with large, global multi-disciplinary enterprises. We write this with care and passion as we want your enterprises to succeed. We would love to hear your thoughts.

Guest Collaborator:

Linda BernardiLinda Bernardi is a Technology Strategist, Investor, and Founder & CEO at StraTerra Partners, The Bernardi Leadership Institute and a Strategic Advisor at Cloudant Inc. She is also the Author of Provoke, Why the Global Culture of Disruption is the Only Hope for Innovation. Learn more here about Linda’s work on disrupting large enterprise analytics.

Please note the following licensing terms for Stikkee Situations cartoons:

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2. PRESENTATIONS, please send $25 to me on PayPal by clicking the button 3. NEWSLETTERS & WEB SITES, please send me $50 on PayPal by clicking the button
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Are you competing at cloud speed?

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Are you competing at cloud speed?We live in an era of constant, accelerating change, and the only organizations that are equipped to keep pace are those that are capable of competing at cloud speed. Does trading out packaged software installed on your own servers for the cloud-based versions offered by your vendor accelerate your organization to cloud speed?

Sorry, no.

So what the heck is cloud speed anyways?

Competing at cloud speed is a goal that every organization should have, and it requires learning fast not failing fast, it involves creating the flexibility to adapt to trends that spread globally faster than ever before, to respond to competition from unexpected sources, and provides a potential antidote to decreasing corporate lifespans.

Accelerating to cloud speed requires your organization to operate under a series of principles that make it both FAST and agile.

Going FAST (the Right Way)

In the experience of Gordon Tredgold, creator of the FAST Approach to Leadership, we usually end up doing either the wrong job or a poor job in an organization because of a lack of focus or accountability, as a result of work has that’s been made overly complex, or because transparency doesn’t exist across the organization.

The FAST Approach to Leadership attempts to address these concerns by answering the What, Who, How and How Far questions related to the task, service or project that is to be delivered (or goal to be achieved). The following four areas make up the letters of the FAST Approach to Leadership and its FAST acronym:

  1. FOCUS is about the WHAT, what we’re doing, what is our objective, and what does success look like.

  2. ACCOUNTABILITY is about the WHO, who is going to do the work, who will be accountable and how will we hold them accountable.

  3. SIMPLICITY is about the HOW, what is the solution, how are we planning to deliver success. Is our solution simple or have we over complicated it.

  4. TRANSPARENCY is about How Far, How Far we have come and How Far we have to go in order to be successful, it’s also about our honesty about our progress and capability.

Focus and Accountability help to ensure that we are getting the right job done, increasing our effectiveness.

Simplicity and Transparency help to ensure that we do a good job.

The objective of FAST Leadership is to ensure that we do the right job, well, each and every time.

Becoming Agile

According to a recent Forrester report titled Business Agility Starts With Your People, a digital business requires an organization to be able to both sense and execute on change, and Craig Le Clair of Forrester outlined a set of ten dimensions that define the digital business, grouped by market, organization and process:

Market Dimensions

1. Channel Integration – Information sharing and cross-channel experiences

2. Market Responsiveness – Customer knowledge and rapid access to resources

Organization Dimensions

3. Knowledge Dissemination – Broader sharing and flatter organizations

4. Digital Psychology – Trend awareness and digital skill sets

5. Change Management – Embracing change and embedded change management

Process Dimensions

6. Business Intelligence – Information management and distributed analytics

7. Infrastructure Elasticity – Cloud awareness and the embrace of cloud options

8. Process Architecture – Process skills and core system independence

9. Software Innovation – Real-time experience and incremental development

10. Sourcing and Supply Chain – Agile sourcing processes and supply chain flexing skills

People looking for a shortcut might hone in on the Process Dimension named Infrastructure Elasticity because it contains a mention of the word cloud and think that this dimension is the secret to competing at cloud speed, but by itself it is not. Forrester’s research showed that the relative performance of an organization along the Infrastructure Elasticity dimension was not a predictor of organizational success, but instead an enabler of improved performance along other dimensions. Craig Le Clair found that greater business agility comes not just from increased Infrastructure Elasticity, but from consciously utilizing that increase to achieve other improvements, such as an improved Digital Psychology or increased Knowledge Dissemination.

Competing at Cloud Speed

When we think about the cloud, what makes it incredibly powerful for organizations is that it breaks down walls. The cloud makes it possible to quickly get people in different departments, geographies, and even organizations collaborating together using a range of cloud-based tools to achieve business goals. When the cloud is viewed not as a solution, but as an enabler of multiple business agility improvements, and a foundation for the principles of FAST Leadership (focus, accountability, simplicity and transparency), we can finally begin competing at cloud speed.

Competing at cloud speed will help improve the velocity of:

  1. Information flow inside and outside the organization
  2. Decision making and commitment
  3. Resource re-deployment
  4. Channel and customer feedback on course corrections

Competing at cloud speed means putting systems in place that quickly capture the voice of the customer, and broadcast it widely and deeply enough into the organization. It means putting the processes and decision-making tools in place to allow leadership to adapt their strategy, redeploy resources and spin up new cross-border and cross-boundary project teams to full productivity faster than the competition in order to capitalize on changes in customer wants and needs.

Are you competing at cloud speed?

Join Inc. 100 and #1 Leadership Expert, Gordon Tredgold, formerly Head of Service Delivery at Henkel, for a simple approach to improve your operational performance live during our expert webinar on October 8 or register for the OnDemand recording.

Sources:

  1. http://www.theleadershiphub.com/blogs/fast-leadership-0
  2. http://solutions.forrester.com/business-agility/improve-your-business-agility-187UW-2434YQ.html
  3. https://www.linkedin.com/pulse/article/20140914015150-649711-don-t-fail-fast-learn-fast
  4. http://www.business-strategy-innovation.com/Voice-of-the-Customer-White-Paper.pdf

NOTE: This article was written for Intuit Quickbase’s The Fast Track but disappeared off the web so I brought it back here


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Is there a market for Smartwatches? Can Apple create one?

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Stikkee 3 - Apple Watch

Okay, it’s been a week since the Apple Watch was announced, and do you know what the world’s most popular wearable is likely to be for 2014/2015?

It’s not the iWatch, but the iPhone 6, which is breaking the pre-sales records of the iPhone 5.

No, it’s not an iWatch. Don’t you dare call it that!

We’re Apple and we’ve decided that it’s far too sophisticated and exclusive to be an iWatch.

Oh, and we’ve also decided that you must own at least an iPhone 5 to be privileged enough to wear an Apple Watch.

Okay, so instantly Apple has reduced the potential market size for the Apple Watch from 6 Billion people to about 100 million people (based on statisticbrain’s numbers).

Now, layer on top of this the fact that in a YPulse survey of millenials, only 32% stated that they wear a watch regularly.

$96 million of smartwatches were sold between October and July according to CNet at an average price of $189 (and dropping fast) – often bundled with a phone – and with Samsung wrapping up 78% of the market. If you do the math, that’s just over 500,000 units, less than 1% of the likely iPhone 5 sales over the same period.

The Apple Watch starts at $349.

But wait, we’re not done yet.

Consider that Samsung has become a faster, nimbler innovator in some ways than Apple and are shipping a new version of their smartwatch next month, up to six months before the Apple Watch is expected to be available – oh, and you’ll be able to use their new watch to make phone calls and run lots of wellness apps (including some from Nike). Plus Samsung will probably launch an even more capable version shortly after the Apple Watch starts shipping.

Apple’s already playing catchup in the smartphone market and they haven’t even shipped their first unit.

So if Apple is entering a small market with a declining average unit price against a more nimble competitor, what rabbit do they have up their sleeve to grow the market and increase their stock price?

What will make the Apple Watch a must have?

The iPod was a must have because it allowed you to carry your entire music library around with you after easily organizing it on your PC and syncing it to the iPod. After that you could then easily navigate thousands of songs on the device with the handy click wheel.

The iPhone was a must have because it became the world’s most widely adopted personal, wearable computer. The iPhone disrupted the balance of power in the mobile phone industry and allowed device makers to start offering whatever applications they wanted (unencumbered by the carriers). The iPhone also disrupted the digital camera market, the Flip (super portable, simple video cameras), and the dedicated GPS market.

Other wearables are on the decline.

iPod sales in Q4 2013 were down 52% from Q4 2012.

Google Glasses got a lot of buzz early on, but interest has fizzled.

Fitbits and Nike Fuelbands have lost their luster and momentum.

Even the iPad, which became a must have after Apple solved the Value Translation riddle and properly highlighted its benefits as a more relaxing and accessible computing device, has seen sales fall the past two quarters as the large screen phones have started to become big enough to begin decreasing the need for a separate tablet. If you’re keeping score the iPad disrupted the gaming industry and challenged people to think deeply about their computing device preferences.

Now back to the Apple Watch…

Can a smartwatch really unseat the mother of all wearables, the smartphone?

In an era of declining interest in watches, can Apple change people’s behavior and lead a resurgence in watch wearing?

These are all very tough questions, but they are not tough challenges that Apple hasn’t faced before.

It’s easy to forget that the iPod didn’t become a runaway success until two years after its launch (with the launch of the PC version of iTunes), and that it took a year for Apple to really ramp up sales of the iPhone (after the launch of the App Store), or that Apple got killed in the press after the announcement of the iPad but figured out how to translate its value by the time they started shipping it.

So, is Apple up to the challenge this time?

After their recent string of game-changing innovations the pressure is on!

Please note the following licensing terms for Stikkee Situations cartoons:

1. BLOGS – Link back to https://bradenkelley.com/category/stikkees/ and you can embed them for free
2. PRESENTATIONS, please send $25 to me on PayPal by clicking the button 3. NEWSLETTERS & WEB SITES, please send me $50 on PayPal by clicking the button
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Five Ways to Make Your Innovation Culture Smell Better

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Five Ways to Make Your Innovation Culture Smell BetterIs Your Organization Committed to Innovation?

If so, download my new innovation culture white paper.

Unfortunately, when it comes to fostering continuous innovation, most organizational cultures stink at it, and they are not innovating fast enough to repel the unrelenting threat posed by new market entrants with declining barriers to entry.

This is why I created my latest innovation white paper in partnership with Planview to help organizations learn how to make their organization’s innovation culture stink less by:

  • Focusing on the basics of culture change
  • Building a common language of innovation
  • Identifying and harnessing the untapped talents, skills, and abilities of employees
  • Leveraging their most curious individuals to drive momentum

Click here to download the white paper

To watch my ON DEMAND video presentation on the same topic, “Your Innovation Culture Stinks: 5 Ways to make it Smell Better” visit www.pipelineconference.com

What does your organization’s innovation culture smell like?


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Are You Investing in an Innovation Culture?

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Are You Investing in an Innovation Culture?

Innovation is everywhere.

You can’t go an entire commercial break during the Super Bowl or a State of the Union address (okay, sorry, both American examples) without hearing the word innovation pop up at least once or twice. Companies have added innovation to their company values and mission statements in accelerating numbers. Some organizations have implemented idea management systems. And others are willing to spend large sums of money on design firms and innovation boutique consultancies to get help designing some new widget or service to flog to new or existing customers. Based on all of that you would think that most companies are committed to innovation, right?

If you asked most CEOs “Is your organization committed to innovation?”, do you think you could find a single CEO that would say no?

So, why do think I’m about to make the following statement?

90+% of organizations have no sustained commitment to innovation.

When it comes to fostering continuous innovation, most organizational cultures stink at it.

Let’s look at some data, because anyone who is committed to innovation (and not just creativity) should love data (especially unstructured data from customers):

  • Over the last 50 years the average lifespan of a company on the S&P 500 has dropped from 61 years to 18 years (and is forecast to grow even shorter in the future)1

  • In a worldwide survey of 175 companies by Hill & Knowlton (a communications consultancy), executives cited “promoting continuous innovation” as the most difficult goal for their company to get right. “Structurally, many companies just aren’t set up to deliver continuous innovation.”2

  • 84% of more than 2,200 executives agree that their organization’s culture is critical to business success3

  • “96% of respondents say some change is needed to their culture, and 51% think their culture requires a major overhaul.”3

So what does this data tell us?

For one thing, it helps to reinforce the notion that the pace of innovation is increasing.

For another thing, it doesn’t exactly scream that organizations are as committed to building an innovation culture internally as their words externally say about being committed to innovation.

Why is this?

Well, as fellow Innovation Excellence contributor Jeffrey Phillips once said:

“When it comes to innovation, ideas are the easy part. The cultural resistance learned over 30 years of efficiency is the hard part.”

And when you get right down to it, most employees in most organizations are slaves to execution, efficiency, and improvement. And while those things are all important (you can’t have innovation without execution), organizations that fail to strike a balance between improvement/efficiency and innovation/entrepreneurship, are well, doomed to fail.

This increasing pace of innovation along with the lower cost of starting/scaling a business and the always difficult challenge of building a productive culture of continuous innovation, is the reason that the lifespan of organizations is shrinking.

So if it isn’t enough to talk about innovation, or to invest in trying to come up with new products and services, shouldn’t more organizations be also investing to making sure their innovation culture doesn’t, well, stink?

The obvious answer is… (insert yours here)

So, if your innovation culture stinks, I encourage you to come join me at Pipeline 2014 and attend my keynote session on exploring five ways to make it smell better:

“Our Innovation Culture Stinks – Five Ways to Make it Smell Better”

It’s a free virtual event on June 6, 2014.

I look forward to seeing you there!

Sources:
1. Innosight/Richard N. Foster/Standard & Poor’s
2. Hill & Knowlton Executive Survey
3. Booz & Company Global Culture and Change Management Survey 2013


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Scaling Local Food Revival with a Business Model Innovation

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Business Model Innovation Taken for a Spin by Zaycon Foods

There is no doubt that people are becoming more interested in where their food came from and with meat prices rising (especially here in the United States with widespread drought in some areas) people are also becoming more concerned with the cost.

Like a blast from the past, when neighbors used to get together and buy a side of beef together and have a butcher carve it up so they could stash it in their respective freezers, Zaycon Foods has come along with a business model innovation and introduced a Farm->Truck->You food distribution system for some types of meat and produce, bypassing several layers of warehousing, truck shipment, and unnecessary waiting time.

Here is a video describing their business model innovation for a spin using chicken as an example:

But it is not just chicken that they offer at their buying events. They also offer 93/7 lean ground beef, premium bacon, ribs, hot dogs, ham, and even seasonal produce straight to the trunk of your car. The benefits of the business model innovation are numerous:

  • Lower prices
  • Fresher food (no waiting steps in the process)
  • No food waste (which is part of the reason retailer’s charge more)

Now operating in 48 states to 1,000+ locations here in the United Sates and a growing favorite of churches, and other group purchasers, neighbors are now banding together and doing a scaled down version of sharing a side of beef (or, um, chicken).

What do you think? Is this an innovation or not?

P.S. They did win the first annual Post Harvest Waste Innovation Award from The Post Harvest Project (TPHP), a nonprofit organization founded in 2012 through the support of The Clinton Global Initiative.

Source: The Seattle Times


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Announcing the Crowd Computing Revolution

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Designing Work for Man and Machine to Do Together

by Braden Kelley

Announcing the Crowd Computing RevolutionI am proud to bring you a downloadable PDF of a piece I created on The Crowd Computing Revolution and the redesign of work that is now possible thanks to new technology tools and business architecture thinking that will allow man and machine to work more efficiently together than ever before.

Anyone who has read even one or two science fiction books or watched one or two SciFi movies inevitably finds themselves dreaming of a day when machines will free of us of some of the mundane tasks in our lives. Companies dream of this too. Witness the eagerness of companies to outsource entire job functions (or even more recently whole business processes) to third parties either onshore or offshore. Hackers and spammers have become quite adept at programming their machines to send emails to people or attempt to break through security around the clock, around the globe. We have built automated factories, interactive voice response systems, and devised all kinds of ways to put machines to work for us.

Roger Martin, Dean of the Rotman School at the University of Toronto has a simple framework from his treatise on Design Thinking titled The Design of Business, that shows how as we learn more about a knowledge (or work) area, our understanding and abilities allow us to move the piece of knowledge (or work) from something that is mysterious and performed in an ad hoc way by experts, to a level of maturity where we start to observe the patterns (or heuristics) in the knowledge area (or piece of work), to a stage where the work or knowledge is well-understood and can be reduced to an algorithm (or set of best practices) performed by lower skilled employees, and possibly even implemented as a piece of code to be executed by a robot or computer.

Knowledge Funnel

Source: The Design of Business by Roger Martin

But, as alluded to earlier, companies have not only become more comfortable with designing work to be executed by machines instead of employees, but also more amenable to many different sizes and shapes of work being completed by people outside the organization, including:

  1. Entire job functions (Contractors or Outsourcing Firms – Global Outsourcing Market was $95 Billion in 2011)
  2. Whole business processes (Business Process Outsourcing (BPO) Firms – 2011 Market in excess of $11 Billion)
  3. Projects or initiatives (Outside Consultants)
  4. Discrete tasks (99Designs, Crowdspring, etc.)
  5. Micro tasks (Amazon Mechanical Turk, etc.)

Task and Micro-Task Division

Task and Micro-task Division

Over time the human race has moved from building simple machines that function as tools (like a forklift), allowing a man to do more with the help of the machine, to building machines and robots capable of completing a whole task (like painting a car or making an exact copy of a document). Has anyone seen a help wanted advertisement for a scribe lately? Meanwhile, our fully automated manufacturing and packaging plants use machines to complete an entire process. But machines aren’t suitable for every kind of work. They are appropriate for tasks that are well-defined and repeated continuously as part of a standardized process, but not a proper fit for tasks where judgment is required, particularly tasks with numerous exceptions, variability, or personalization.

As a result, typically machines and robots have been relegated most often to the production areas of a business, places where it has been easy to define specific tasks or even whole processes that can be designed for machines or robots to own and complete 24/7/365 if necessary.


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Rethinking Who (or What) Does the Work

Crowd Computing Part 2Rise of the Crowd

There is another growing trend that is now rivaling the growing power of robotics and automation – crowdsourcing. It all started with prizes like The Longitude Prize, but now thanks to the power of the Internet, companies and individuals all around the world are breaking down their projects and processes and tapping into the power of the crowd using loosely-organized, non-employee workforces like Amazon’s Mechanical Turk to execute micro-tasks, getting whole tasks completed through sites like Top Coder and Crowdspring, or calling upon the crowd to solve difficult challenges using sites like Innocentive, NineSigma, and Idea Connection. Sites like these enable organizations to access knowledge, expertise, perspectives, or capacity that they don’t currently have in their organization (or to possibly to get a task or challenge completed at a lower cost). Check out my white paper Harnessing the Global Talent Pool to Accelerate Innovation to learn more about this topic and some of the strategies for successfully leveraging external talent.

Rise of the Business Architect

Our organizations face an innovation imperative amidst intensifying competition that is forcing an increasing number of industries to become commoditized. This increasing need for a sustained level of innovation and a requirement for innovation to be a repeatable and sustainable activity, has led to an increasing number of organizations to consciously design their approaches to the new businesses that they enter. This has led to the growth of two new business disciplines – business architecture and social business architecture.

NIH Business Architecture

Source: National Institute of Health

Business Architecture, according to Wikipedia, is “a modern technology-oriented business occupation…. Working as a change agent with senior business stakeholders, the business architect plays a key part in shaping and fostering continuous improvement and business transformation initiatives. Business architects lead efforts aiming at building an effective architecture for the business process management (BPM) projects that make up the business change programme. The business architect implements business models that require business technology to work effectively.”

Social Business Intersections Social Business Connections

Social Business Architecture on the other hand, facilitates and optimizes the group dynamics and interactions inside the organization, and Social Business Architects specialize in identifying the different parts of an organization that need to interact with groups of people outside the organization, how those parts of the organization should work together to communicate with people outside the organization, and help to identify and implement communications solutions that connect the organization with the target groups so that a meaningful connection and conversation can be built, and then helps to manage the conversations and the information and learnings from their outcomes for the benefit of the organization.

Social Business Attraction Social Business Engagement

Few organizations employ or are even yet aware of the need for Social Business Architects, but there are an increasing number of help wanted postings for Business Architects. This is because not only do organizations recognize the need to architect their new lines of business for maximum efficiency and to , but also because there are so many different ways that work can be executed (employees, contractors, consultants, outsourcing, business process outsourcing (BPO), crowdsourcing, and micro-task execution, that for maximum efficiency it now increasingly requires someone to investigate all of the options, break down the work to be done into jobs, projects and processes, tasks and microtasks so that the right resources can be hired, contracted, briefed, or otherwise engaged to ensure that everything is completed as quickly and as cheaply as possible.

A Guide to Open Innovation and Crowdsourcing

Investigating Examples of Crowd Computing

The Crowd Computing Revolution - Part ThreeMoving from The Design of Business to Redesigning Work

Business Architects have the opportunity to plan for the organization how work can move from mystery to heuristics to algorithms to code. Business Architects (or people filling this role in an organization) have the opportunity to redesign work in the most efficient way possible to leverage both man and machine to get the work done at the lowest cost possible. Technology now exists to allow Business Architects and managers to move beyond allocating work on a job, project, or process basis, and instead design flexible workflows that combine the use of humans and machines to complete the tasks that they are best suited for, or even for humans to augment the work of machines.

For example, imagine that you work in the purchasing department at a large multinational and every month you receive hundreds or thousands of invoices from suppliers all over the world in all different kinds of formats – electronic, mailed paper invoices, PDFs, scanned paper invoices, and even faxed invoices. Your job as purchasing (or accounts payable) manager is to track all of the invoices that you receive, get them entered into your ERP system, and ultimately make sure that they get paid. You can hire or use an existing employee or contractor to manually key them all in, or sign a big dollar outsourcing deal sufficient to support the hiring, training, and management of offshore resources by the outsourcer, or you could try and use OCR software to do the job, but it would fail because of the great deal of variability in both the input sources and formatting of the documents and you’ll end up needing human resources to interpret the OCR output anyways.

Crowd Computing Invoice Processing Example

Or, you could examine the workflow of the process and identify which micro-tasks humans are best suited to perform and which micro-tasks machines are most efficient and cost-effective at performing. Then assign the right micro-task to the right resource. In the case of human resources, this could be an employee, a contractor, an external expert, or even a resource you don’t even know or control (via a crowd workforce like Amazon Mechanical Turk, Elance, etc.). And finally for each micro-task, assign a level of confidence in the quality of the assigned resource’s output and a define a process for grading it. In situations where you have a high level of confidence in the micro-task’s output quality, you can move directly on to the next micro-task in the workflow, but if you have a low level of confidence in a particular micro-task output performed by a machine, assign an alternate process to validate that output (such as using someone via Amazon Mechanical Turk to validate that “yes, this is a purchase order number”).

But that is not all that is possible these days. It is now possible for systems that facilitate the management of this kind of atomized work structure definition and workflow management and assignment, like those from Crowd Computing Systems, to also use artificial intelligence to both learn from the corrections that humans are making to a machine-driven, micro-task execution to get more accurate in the future, but also to learn how to do micro-tasks that humans are currently performing without machine assistance and to help identify the best performing crowd resources to inform work allocation decisions and to perform overall output quality optimization.

Conclusion

In much the same way that outsourcing felt awkward 20-25 years ago and Business Process Outsourcing (BPO) felt foreign a decade ago, the time has come for crowd computing to begin to be a tool that managers and Business Architects can keep in their toolbox to better allocate work across man and machine. The time is now for man and machine to work together in ways that they never have before, and to learn from each other. The time has come for businesses and work to not just be operated and executed, but designed for maximum efficiency. Should we be afraid as workers that the machines are going to take away our jobs and leave us with nothing to do?

No. In much the same way that tractors and steam shovels began freeing man and beast from back breaking work nearly two hundred years ago, there are many benefits for man to gain from the crowd computing revolution – the biggest being freedom from an increasing amount of mind numbing work. Organizations that embrace crowd computing stand to gain not only to potentially lower processing costs for many high volume processes, but also will benefit from acquiring the ability to reassign analysts and other highly-skilled and trained employees to higher value work – better leveraging their existing human resources while simultaneously increasing employee satisfaction, retention, and knowledge creation in the enterprise. Are you ready for the crowd computing revolution?

Click Here to Download The Crowd Computing Revolution PDF

Sources:

http://speakology101.com/welcome/2012/05/21/break-it-down-tasks-sequencing/
http://www.huffingtonpost.com/martin-ford/job-automation-is-a-futur_b_832146.html
http://www.statista.com/statistics/189788/global-outsourcing-market-size-since-2000/
http://www.rediff.com/business/report/bpo-market-to-be-worth-14-bn-in-2011/20110412.htm


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Stoking Your Innovation Bonfire – The Slideshare

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I’ve uploaded a sample chapter of my highly-rated popular book Stoking Your Innovation Bonfire from John Wiley & Sons to Slideshare. Stoking Your Innovation Bonfire is a great book focused on helping organizations identify and remove barriers to innovation, but also serves as a great innovation primer for organizations beginning their innovation journey and looking to establish a common innovation language across the organization.


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Stoking Your Innovation Bonfire is available on the various Amazon sites around the world and at other fine booksellers and public libraries.

You can buy the book in bulk here:

You can download Stoking Your Innovation Bonfire in digital form here:

You can probably check out the book from your local library (or request it):

Or you can buy a traditional paper copy of Stoking Your Innovation Bonfire here:

Thousands of people around the world have already purchased, downloaded, or checked out their copy of Stoking Your Innovation Bonfire and enjoyed the easy, but valuable read, and I hope you will too.

Keep innovating!


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Are Coca-Cola and Green Mountain Late to the Personalization Party?

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Are Coca-Cola and Green Mountain Late to the Personalization Party?Recently I came across an announcement that Coca-Cola is partnering with Green Mountain Coffee Roasters to sell Coke products as part of Green Mountain’s new home beverage system slated for a release later this year. For those of you who aren’t familiar with Green Mountain, they make the popular Keurig in-home single-serving coffee machine (which became a popular home and office item after Nespresso’s patents expired). Now they want to expand their in-home beverage machine product line to include cold beverages. What is not clear in the press release is which of Coke’s products will be available with this new beverage system.

Will it only be beverages like Minute Maid juices, Powerade, Vitaminwater and non-carbonated beverages in their portfolio?

Or will it include the Coca-Cola crown jewels – Coke, Diet Coke, Sprite, etc.?

The only thing that is mentioned is that the system will not contain a carbon dioxide cylinder that needs to be changed periodically (something the Sodastream system requires).

So, what is driving Coca Cola to pursue this $1.25 Billion investment in Green Mountain Coffee Roasters in search of innovation?

Well, there are many different reasons why companies seek to innovate.

In Level 1 of the Global Innovation Certification we refer to this as Innovation Intent, and I am currently recording the fifth video module from two full days of live certification training materials for the Level 1 Innovation Certification eLearning, and this video module happens to be about innovation intent.

Some of the reasons that companies look to innovate can of course include:

  1. An ambitious leader
  2. A changing regulatory environment
  3. A changing competitive environment
  4. A desire for new growth opportunities
  5. Faltering company financials (burning platform)
  6. A need for competitive response
  7. Requests from customers
  8. Recognized new supplier capabilities
  9. Demands from shareholders
  10. Requests from passionate employees
  11. INSERT YOUR REASON HERE

Coca Cola FreestyleSo what is going on here for Coca-Cola?

Well, competitor Sodastream recently splashed out $4 million for a Super Bowl advertisement (during a game that our local Seattle Seahawks won) and has been growing steadily (while still small compared to Coca-Cola). But it does have a market cap of $780 Million and a growing fan base. But, at the same time, Coca-Cola is investing $1.25 Billion for 10% of Green Mountain Coffee Roasters. Why are they investing more than $1 Billion in this interesting, but still comparatively small segment of the beverage business?

Is this a smokescreen move, announcing a product that may never see the light of day, in order to dent the growth of an emerging competitor?

Is it a competitive response, a hedge, with a me-too product in case the home soda bottling movement continues to grow?

Is it just a logical doubling down for Coca-Cola in a belief that the beverage personalization trend has not exhausted itself yet, and building upon the success of the Coca-Cola Freestyle and the groundwork that Sodastream has done to seed the market for Coke?

Or has Green Mountain Coffee Roasters, with its massive distribution channels (in comparison to Sodastream), brought Coca-Cola something that truly represents an innovation in the beverage system market versus the Sodastream offering that might result in people switching and both gaining back market share for Coke in their core markets, while also potentially representing an opportunity for some of their less successful brands to gain traction in a space where they don’t have competition from Pepsi?

This of course would be the more interesting of the strategic undertones, and the one in which Pepsi, not Sodastream should be the most worried.

Because after all, in the minds of Coca-Cola executives, it is Pepsi that they are always most worried about, not someone like Sodastream, and anything that allows them to potentially steal market share from Pepsi, makes them very happy indeed.

What are the motivations behind this move and partnership, which direction will all of it go, and is there any real innovation happening here?

And what will Pepsi do?

I guess we will have to wait and see.

Meanwhile, ask yourself what your innovation intent is, and…

Keep innovating!


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Changing Business Models Around

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Changing Business Models AroundSome business models and products have been around so long that we just take them for granted, while others concepts that are becoming new business models are so new that we’re not quite sure what to expect. It is probably easiest to explain what I mean and why this juxtaposition is important by looking at a few examples. Most of these examples involve challenging our orthodoxies.

1. Coffee Shops

In the typical coffee shop pretty much anywhere in the world, the business model works like this – you buy a coffee and it comes along with it the right to take up a place at any table in the café for as long as you want. So, coffee buys you time. An article I came across on NPR highlights an entrepreneur in Moscow that has opened a restaurant that loosely translates to the Clockface Café where instead of buying coffee and getting time, you instead buy time ($4/hr per person for the 1st hour and $2 an hour after that, up to a maximum of $12 after 5 hours) and get coffee for free. Ivan Meetin, the founder, plans to open his next café in London. Meanwhile I have heard of similar operations in Paris, and by now they can probably also be found elsewhere. So, in your business what do people get for free, and what do they pay for? And is there an opportunity to change around what you charge for?

2. Waste Disposal

In many businesses, and in the creation of most products, there is waste. And in most cases, businesses pay to have this waste removed from their premises. Or there may be waste that the customer has to pay to have removed. But this doesn’t always have to be the case.

KFC, McDonald’s, Burger King, etc. used to have to pay to have their used fryer oil picked up, but now thanks to the rise of biodiesel they may even make money from this waste product.

Chicken FeetChicken processors used to throw the feet away after processing a truckload of chickens, but after they discovered that chicken feet are a delicacy in several Asian countries, they stopped throwing them away and instead started exporting them. In fact, chicken feet sell for more per pound than chicken breasts in China.

Broken OREO’s used to have no value before Cookies ‘n’ Cream ice cream (and now Cookies ‘n’ Cream OREO’s) were discovered.

And finally, I came across an example of a bottle cap concept created by designers from the Lanzhou University of Technology in China, intended to give poor children access to building blocks for play, from what was previously thrown away.

Building Caps

3. Discounts for Data

Data security and privacy is becoming an increasingly hot topic, and in the past companies would either ask customers for their data and not give them anything for it, or just not ask for it. But now we are seeing some interesting models of companies asking customers for data and instead giving them something of value in exchange. For example, Urban Outfitters rewards users that respond to promotions inside their mobile app or to users that allow its app to connect to their Twitter or Instagram accounts with points that can be redeemed for sale previews, concert tickets, or early access to new pieces. What data do you want from your customers? What is it worth to you? How could this exchange be made engaging and not be seen as a purely financial transaction?

4. The Soft Drink Category is Saturated and Cold

Soft drinks… How many people out there think that the soft drink category is a blue ocean full of incredible opportunities for unbounded growth for established soft drink makers? Most people would say that this is a mature category and a tough place for companies, full of merciless competition. But yet, people continue to innovate and challenge this orthodoxy. Witness a couple of interesting new concepts.

Shericks ShakesBritain has always been a hotbed of innovation, and the country that brought us Pret a Manger and Innocent smoothies brings us this tasty treat. Mr. Sherick’s Shakes brings people a little bit of luxury to their day in the form of their high quality milkshakes.

Meanwhile in Japan, there is a growing trend manifesting in a wave of product launches in the soft drink category that are not cold, but instead hot. Witness this example of what has always been a cold drink, Ginger Ale, being brought into the Japanese market as a hot beverage by Coca Cola’s Canada Dry unit.

Canada Dry Hot Ginger AlePeople always love something new and different, even if it is something old that has disappeared from the market. This is why fashion runs in cycles, and in a mature category like soft drinks there is no reason why we shouldn’t keep these principles in mind and see if now is the time to bring something back, or to see if there is an orthodoxy that we shouldn’t now look at challenging to see if an opportunity might not be created.

Conclusion

Innovation transforms the useful seeds of invention into widely adopted solutions valued above every existing alternative. Value comes not just from physical invention, or business model innovation, but from psychological and emotional benefits as well and the creation of new psychological or emotional value can happen in any industry at any point in time, no matter how mature the category seems to be. We as humans are strange creatures and we simultaneously fight against change (and hold back innovation as a result) and embrace new things (or at least like to try them). So challenge your patterns of accepted thinking to look for opportunity and work to overcome your beliefs that everything that could be done has been done in your industry.

Keep innovating!


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