Old and New Economy – A bigger gap than expected?

Impressions from the Best of Both 2013 in Berlin

Panel Discussion on Best of Both 2013 in Berlin

Create a new conference format that goes clearly beyond investment pitches by start-ups to get funding. Bring people together who would normally only meet occasionally, but not necessarily discuss with each other about what is really important to them. Hope that they meet on peer level. Hope that they discuss content and go beyond clichés like start ups are faster and bear higher risk.

This is what I would hope for if I organized a conference like this year’s Best of Both in Berlin. Hosted by SWAB, a German foundation focussing on bringing the two worlds together, it gathered more than 200 people from the old and new economy respectively.

bestofboth_logo-300x300A lot of interesting speeches and statements, but beyond “vision, sales and leadership” there was not so much concrete input. On the other hand, the representatives of the new economy also focused on things one would expect them to say (e.g. ” watch out, the social wave is coming” or ” we are just at the beginning”). As very often in similar situations, it felt like them creating fear and leaving behind uncertainty among the more traditional folks. Just as @Ibo put it: “there is a lot of uncertainty around digital. But nearly no one dares to admit it.”

Ibrahim Evsan on stage during Best of Both 2013 in Berlin

The good news wasn’t discussed: that there are ways to deal with the challenge of transformation. Social or big data are much more than technology. It is a fundamental change of behavior of customers. I was happy to hear Cafer Tosun from SAP Innovation talk about Design Thinking. This focus applies the same way to an old economy company trying to deliver a world class service to its customers as it applies to a startup that is trying to build products that customers love…

Finally, Burkhard Schwenker, the CEO from Roland Berger Consulting was also trying to identify the common ground of old AND new economy: good entrepreneurship. And with that speech the conference ended.

All together this type of content only represented a small share of the whole program. I personally believe this is a missed opportunity for a conference with its legitimate ambition to bring together both worlds that are facing similar challenges. But thank you to SWAB for hosting this event and to Caspar von Gadow & Team for organizing it. Keep it up!

Why thinking lean means focusing on very few personas

Typically “lean” is used to describe how to develop products. But you can also look at it from a service point of view. If you aim at delivering a world class service to your clients, it makes sense to have a very clear picture of your customer in mind. A customer is playing a vital role in service delivery, she/he needs to contribute to the process – otherwise the result won´t be as expected for both sides.

What do I mean with this? Let’s take an example: every car hire customer is rewarded a certain level of attention by the front line employee. Who wouldn’t know those customers who are very demanding and seem to be eager to get as much attention as possible? The car hire company might decide not to serve this type of customer. It could be that this means not generating revenue from e.g. VIP like customers at all. This would then allow a higher level of standardization and a would then result in a more equal share of resources and attention respectively.

Personas serve as a proxy for behaviors of real world users. You could see this a typology. So, if you create (and try to serve) too many of them, you won’t be able to a) satisfy them all well enough and b) streamline the product you build. Less is more: have ONE problem and ONE persona in mind when you are building great products.

Thinking lean = standardizing = appealing only to a few or only one persona

Seeing Facebook, Google & Co as pure service providers impacts how we design internet products

When thinking about the role of technology or “digital” (as many people would prefer to call it), we have learnt during the Services major @HEC in Phoenix, Arizona that it can replace so called front line employees. A service is been delivered to the customer. Almost like the process of car rental or sleeping in a hotel.

At first sight, this sounds pretty trivial, doesn’t it? But, please think twice: if we design websites, apps etc. with the mindset of delivering a service to our customers (not users 😉 ) this might have an heavy impact. One impact can be the the value we deliver to the customer isn´t worth mentioning because it might have become a commodity. Another one could be that we will focus more and align our efforts with much more rigor. We need to focus on delivering on the promise we make to our customer.

So, please take a moment to think about the promise a service like Google is making to its customers. And then think about potential solutions. And finally compare your ideas with the real solution that Google have built. Any gaps here?

We have been told about the “moments of truth” concept. Do we deliver to our customers when it counts or do we fail? It might be worth considering either making the promise smaller or focusing on a more specific target audience. But you will better deliver in a moment of truth or your customers will look for alternatives or substitutes respectively.

A 19yr old explains Top Level Executives how the digital world works

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Yesterday I stumbled upon a book with the title Wer wir sind und was wir wollen – Ein Digital Native erklärt seine Generation by Philipp Riederle (@Phipz). In English this means “Who we are and what we want – a digital native explains his generation”. This is an amazing book for a “Digital Immigrant” like me, I can only recommend it. Unfortunately it is in German only, and I don’t know whether there is plan to publish an English version soon. Could also imagine German Execs needing a book like this more than US Execs.

Philipp portraits the “Digital Natives” in a very comprehensible way, and I am absolutely sure many Designers will use his descriptions to describe their personas even better.

And for those who are still reluctant to listen to a 19yr old man: if you don’t seize this opportunities, I am sure, others will…

 

Digital blurs the distinction between product and service

For my preparation for the Services Major @HEC I have read some interesting stuff about service blueprinting. What I find really interesting is the fact that digital can be seen as the replacement of front line employees. Or, in other words: the “physical” product is kind of “dissolved” into a service. And this fits very well into the product management concept of finding solutions for user problems on the one hand side and on the other hand side the border between marketing / branding (e.g. intangible assets) is becoming more and more unclear…

In some circumstances, it makes sense to modify the traditional blueprint. For example, when blueprinting an Internet or kiosk-based service that does not have any onstage contact employee activities, it could be beneficial to remove the onstage contact employee action row and replace it with an onstage technology row that would capture how customers interact with the company’s technology (p. 12 “Service Blueprinting: A Practical Technique for Service Innovation” by Bitner, Ostrom & Morgan).

If a company is really serious about providing great service, everything needs to be thought from the customer. In Bitner & Co. framework, this would be Physical Evidence / Customer Interactions layer. This is very close to design thinking. There are also interesting case studies to be read about companies who have become successful due to a radical change in their thinking: from executive level to frontline employees. It is great, not to feel too lonely as a Product Manager and to get support from academic folks in the US (https://twitter.com/WPCCSL) with great reputation. In that sense, I am really looking forward to our Services Major @ The Center for Services Leadership (CSL) in Phoenix, Arizona next month!

When ignoring design thinking destroys company value

When employees don’t want to see the limitations of their mindset, it becomes dangerous for their companies. Even more if they are in executive or leadership positions. Not only the diversity of thinking is at risk, but also critical competencies can be missing. But what to do if there is a completely blind spot? If the responsible managers simply are not aware of their open flanks? This can happen even to the brightest people. With great experience and superior thinking. Suddenly they might intuitively feel challenged on a very fundamental basis. A challenge that questions everything they do and have done so far. And believe me, consequences arising from this type of challenge on a very personal level can be really irrational. I have experienced such situations at least twice in my career.

And then comes the moment of truth: how do they react? Do they let this threatening thing happen (for the best of their business) or do they fight it back (for the best of their self affirmation)? Times have changed: technology enables customers to do things that have never been conceivable before. It is time to change perspective and really build great products for them. Which companies will see and use those opportunities? Not those with employees and executives who won´t let go.

Designful companies will outperform the others. It is just a question of time…

No need to be afraid of R&D

When I was put in front of engineers for the very first time, I really didn´t know how to deal with them. Quickly I realized that my leadership style didn´t work out anymore. Please don´t get me wrong: I was an experienced manager with almost ten years of leadership experience. Until that point in time I was pretty successful in my roles. My strategy to get myself over this point was to put pressure. “We need to have feature A released by June, otherwise we won´t achieve our business target and our investors won´t like it…” I said. And you know what: my R&D colleagues simply didn´t care. Instead they asked me what to do, how to build it etc. I was not able to answer questions about the product itself and was caught waffling in many cases.

More than that: I always felt uncomfortable to talk about the product to be built. Even tried to avoid talking about it. Incredible, isn’t it? On top of that, I tried to avoid exposure to the teams in charge. Wanted to “manage” it top down.

The result was poor. We launched a product that more or less completely failed. But even worse: I had lost my reputation with my R&D team. They simply didn’t take me seriously anymore. My behavior had increased the gap between “business” and “engineering”.

Now after a couple of years later I understand why. I had to learn it the hard way how to collaborate with my R&D colleagues. But not without having gone to the other extreme: having lost my connection with my stakeholders. Only in the recent years I have been able to balance the needs better. And actually got a lot of satisfaction out of this. Starting with a product vision and then going through technical but also design and customer iterations is something extremely exciting.

The most important thing you need to bear with: accept that you don´t know much. You don’t need to be the one knowing everything and also not the one with the best ideas. In the contrary: the more you step back the more successful you will become. One team gave me a nickname after I had left – “Il Padrino” – the guy behind the scenes but in charge…

Many business people eye away from uncertainty

Learning about all the frameworks in a MBA education and dealing with all the business cases leads to a situation where business people might feel over confident in understanding what is going on in the world. More than that: a lot claim to know better and to have a more strategic view than the Product Managers.

At the same time, the Product Manager is forced to justify his/her proposal in a situation where proof of evidence is simply not existing. And not only that: many assumptions are being made. If you forced design thinkers to prove every single of those assumptions, nothing will ever really happen. It is all about intuition and iteration with real customers. It is about dealing with uncertainty. Really dealing with uncertainty – not just pretending to do so.

“The Designful Company” is a great book. It also describes the situation of the earth not being entirely discovered. Maps would only cover part of the globe, many white areas are still left. There are some people who are attracted by those and who are willing to “fight the dragons”. And others shy away.

Digital has created even more white spaces than ever before. The world is full of new opportunities. So why do many business people don´t conquer them? Well it is because of the uncertainty they would have to admit to be existent.

If you have an idea about your target market and a top level understanding of what product you want to build you still have the challenge to build it. Building it from scratch is hard. You can copy cat similar products or you can just tweak your existing UI – both feel more comfortable than jumping into the cold water.

And now imagine the product visionary coming in with her/his ideas. Not using what is out there already but trying to build new solutions to existing problems. And now try to figure out your own emotions in such a situation. You don´t understand the solution, it is different from what you have experienced before. Would you leave your framework castle to deal with it or shoot it down from behind your safe (business) walls? Up to you to decide!