Saturday, June 7, 2014

Segmentation What & Why Defined - Harvard Business School Publishing & New Product Blueprinting

I am always on the look out for helpful definitions, that bring clarity to a concept versus obscurity.

Here is a simple one page overview on segmentation that I find useful when trying to share this concept with others.

Here is an overview from New Product Blueprinting, tailored to B2B market research/new product development. An excellent how-to manual on developing breakthrough products for B2B markets, that gives step-by-step guidance.
This is a sample chart from the book, which enables you to effectively segment markets and prioritize them, so that you can focus your qualitative research efforts on your best-guess target markets to win in.

And finally, here is a pretty useful and easy-to-understand overview of 3 main types of B2B segmentation:
  • industry/firmographic (akin to demogrphaic segmentation for B2C markets)
  • customer tiering (focusing in size of prize and fit of your value proposition)
  • needs based (grouping by needs, however these companies will be across industries and appear very heterogeneous)

Saturday, February 1, 2014

Failure - on the Path to Success

I like to say I spend most of my days failing, and I like to believe that this does not bother me. But I do, and it does, no matter how much I tell myself that failure is required to succeed in innovation.

Science Friday's 1/24/14 interview with James Dyson is worth a listen. If like me, so much of your work is learning about what could or could not be, you will probably find it helpful to be reminded that failure is important and helpful.

Basically Dyson says, if you can look at your failures and find them interesting, then you can learn from them and ultimately succeed. He toiled away making hundreds of prototypes of his first vacuum before getting it right. But he looked at the failures as opportunities, not ends.

Dyson's interview also reminded me about the importance of defining your work in terms of a clear hypothesis and establishing the desired outcome.

A well understood (and documented) hypothesis, makes it easier to figure out that something did or did not work as expected. And when something does not work, you are able to correct yourself.

It may be annoying, but I do it all the time - keeping it in my head is not good enough. This way, I cannot forget what I wanted as an outcome or pretend that an unsatisfactory result is good enough. It keeps me honest and I am far more efficient in understanding the root cause of the failure

Sunday, September 29, 2013

Empower your innovation work with strategy!

I have spent the last few months working on an innovation strategy, on the side along with my other product projects. Friday I presented it to our leadership team and the following is a brief explanation of 1) what it is, 2) why I thought it was important to do, and 2) how I got it done.

I cannot share any of the actual content of course, but this is enough to give you an idea of how to do this work yourself.

One note, I did not do this work alone. I am incredibly grateful to one of the principals at Innosight for introducing me to this tool and then holding my hand through this work.

Goals and Boundaries.jpg
(Image from "How to Form an Innovation Strategy", HBR blog Aug. 2008)

What is an Innovation Strategy?
Ultimately, the strategy represents alignment among the key leaders at an organization overseeing innovation in terms of what innovation needs to achieve, where innovation will be focused and how it will get done.

Specifically the strategy has a few key components:
  1. Vision of the industry and organization 5 years out;
  2. Growth targets (including expectations of revenue gain/loss or margin erosion);
  3. Assessment of how attractive certain geographies, end users, markets, brands, categories, channels, etc. are in terms of delivering growth through innovation; and
  4. Assessment of how effective certain capabilities and business models will be at delivering innovation success.
The above image is a sample output of the strategy. The wheel chart offers the company a visual tool to remind us what is desirable, discussable or out of bounds in terms of innovation efforts on a daily basis.

Why I think an Innovation Strategy is important.
Whatever the tool you use to define an innovation strategy - it can drive effectiveness and foster trust for innovation initiatives.

Innovation is by its nature a fuzzy and inexact field of work. Without clarity regarding the end goal of innovation efforts, where it is expected to occur and how it is going to get done, there is even greater room for confusion. 

It is easy to say let's be more innovative and have more innovation. But unless these aspirations are translated into clear calls to action across the organization there will be no innovation.

In my specific case, I knew we were missing something. I knew we were not as effective at innovation as we could be.  For example, I found myself reviewing ideas and wondering, would the leadership expect that we evaluate this idea or vault it? I'm passionate about open innovation so I developed a program, but I had to ask myself, what is the leadership's expectation from oi? There are the employees who want to contribute ideas and information - what direction could I provide about what we are looking for and what kind of ideas are valuable? And of course there is sales - how soon and how often should they expect innovation and in which categories?

I could not answer these questions on a case-by-case basis or answer them alone.

How I set an Innovation Strategy.
When I first started my job, I had asked the leadership what winning looks like, where we were going to innovate and how we were going to win. However, I found that posing those questions to the leadership was ineffective. They were too broad, too easy to answer without giving extensive thought.

I was excited to learn of Innosight's framework - it offered a clearer set of questions that were easier to respond to, but required greater consideration.

To set the strategy I took the following steps:
  1. Determined what the wheel chart should look like - what business aspects should be evaluated, what types of decisions could not be case-by-case per project but needed to be strategic,
  2. Developed a discussion guide, outlining the key questions for the strategy,
  3. Provided the discussion guide, related articles and a letter outlining the value of the strategy and key steps a few weeks in advance,
  4. Interviewed each key leader at the organization,
  5. Analyzed the data to develop a the strategy and wheel chart,
  6. Presented to the leadership and identified action items - such as developing a plan, working to foster an innovation oriented culture, etc.
 The most difficult part was step 1. I went back to why this was important to do - what types of questions kept arising that could not be answered on a case-by-case basis?

The entire process took a few months, as a side project. One could complete this work in a month or so. I have been testing the strategy over the last few months. It feels good to be able to be more decisive regarding where to focus and how to get things done. It is early to tell, but it seems the leadership feels a little more comfortable too - it is a little bit of clarity in what is a very fuzzy world.

Sunday, September 15, 2013

Give Your End Users Homework Before the Interview.

We are looking at a completely new category of products - one that intuitively seems in dire need of innovation.

I'm excited about the insights we have captured, many of which seem to be the result of giving our research participants homework 1-2 weeks in advance of interviewing.

I wanted to share a little bit of detail on this for those who do end user research.

Most often, our process for identifying opportunities to innovate looks a little like this:
  1. inspiration - an idea, a new technology, connecting a trend to a new category, etc..
  2. a little secondary research to assess unmet need, competitive landscape, or technical solutions,
  3. qualitative research - usually in-depth interviews, shop-alongs and hands-on demonstrations.
This time however, we added in some up-front end user homework. We sent each research participant a box of 10 different products and asked them to spend just a half an hour opening the packages, looking at the products and using them in their home, if and where appropriate. The category is broad, so there was a wide variety. We also let them know in advance what we would ask them.

This radically changed the results; the insights were richer because people had spent time thinking about the products we sent and using them. And, while this was a foreign category for us, we were quickly able to understand consumer perceptions and attitudes related to current offerings.

Interview after interview, we arrived to people's homes to find our box of homework opened, products unpackaged, notebooks with pages of answers to our questions, and participants excited to walk us around their home and show how and where they used what we sent. Many times we learned that the homework had been a family activity or shared among roommates.

I saw a difference in people's comments - we were able to probe more. Perhaps because they had time to consider the products, but they were also highly engaged after spending time - far more than we requested - doing the homework.

If you work on product innovation or product development - I highly recommend adding homework to your research method next time. And if you are not yet doing end user research in-house, I highly recommend that you do. It's easier than it seems and it makes finding the opportunities to innovate much easier, without having to spend a lot on consultants.

Sunday, September 8, 2013

Big company response to innovation is like a human body's response to infection...says Dave Ulmer.

If you read about innovation, particularly for large companies, you have heard certain things before:

"Those things that make a company great are the very things that keep a company from being innovative."

"If you are not competing against yourself - being your very best competitor - someone else will be."

These are quotes from an interview with Dave Ulmer by Kelli Richards in July 2013.

It was worth a listen, similar to most other interviews, blogs posts and books on innovation. They are worth a read or a listen though because while they are repetitive, inevitably, I find that I am not putting into practice what I know I should.

What did strike me as a unique analogy was Dave's comparison of how the human body fights infections to how a large organization fights a disruptive innovative effort. It is catchy and it makes sense. Operations designed to scale and sustain what already exists are uncomfortable and often alarmed by the new, the unbelievable, the unproven.

I like this analogy and will remember to use it the next time I am giving a new product concept presentation. I look forward to reading more from Dave Ulmer as he has recently put out The Innovator's Extinction.

Thursday, June 13, 2013

The power of end user research for product designers.

When I began my job a little over one year ago, titled new product innovation, I was to some extent a novice. So I spent a good deal of weekends and evenings learning how to establish a strong product innovation process. I did not want to just dive into searching for some good new product ideas, but instead create processes that would sustainably deliver ideas for breakthrough products for any years to come.

When I assess my first year on the job, one major achievement stands out in terms of achieving this goal. Equipping my organization with the ability to carry out end user research any day of the year. This capability has become the foundation of our product innovation process. End user research is the one activity that always delivers new insights - information such as pain points and unmet needs that often people did not even realize they had.

I have become a bit of a fanatic. I truly believe that end user research is the only way to begin product development, and I doggedly refuse to go about kicking off a product project any other way.

End user research is simply the act of understanding the people you aim to develop a product for and how they currently complete the task your product is targeting. There are more methods of doing this work than I will perhaps ever be able to learn, and there is an art to selecting the right method for the right output you seek. For me, there is nothing like going into someone's home and observing as they carry out the task we are trying to make easy by means of a new product.

What is perhaps most exciting is that you can get these insights by interviewing a small number of people. This graph shows the sample sizes required, provided your sample consists of the right target audience. Once you go beyond 6 users there are diminishing returns.

How can you get started? I list a few resources here on this blog that I have used and highly recommend. Our consumer insights researcher recently found this Google Ventures video that is an excellent primer with extensive detail.

One note. It is important to remember what this methods does and does not give you. The insights are directional, it is in no way a replacement for some quality quantitative research when you are looking for statistically significant data.

So go get researching, you are perhaps just 20 hours away from having collected some critical insights that will direct your vision for a new product design.