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What is technophobia and how to deal with it?

Authors of scholar paper in Behavioral Sciences defined technophobia as extreme and abnormal fear of effects of advanced technology. According to research, technophobia demonstrates through irrational behaviors not only toward technology artefacts such as computers, drones, autonomous vehicles, but also toward advanced-technology-related phenomena of work automation, or personal data processing in the cyberspace.

Particular type of technophobia is fear of not being able to understand or learn to use given technology. Research results claims that up to 1/3 of world’s population might be affected by various types of technophobia. A group that is particularly prone to technophobia are the elderly.

Older people have much less experience in usage of advanced technologies compared to generations of digital natives. Less experience in usage of technology impairs self-awareness and capabilities related with understanding of technology and results in anxiety, stress and reluctance of usage of modern technologies at all. Such attitude, often called anti-digital, results in exclusion from participation in life of society, and lessens ones autonomy and ability to develop new cognitive, social and occupational capabilities.

Research published in Frontiers in Psychology draw attention to the fact that technophobia not only results in negative effects in social domain, but also might cause a drop in productivity and effectiveness at work. Authors of the research published pay particular attention to an impact of technophobia on acceptance and usage of modern care delivery technologies, especially in telehealth and telemedicine, including video consultations with clinicians or other remote health-monitoring solutions.

Both people affected by technophobia and technology producers should strive to find remedies for fear, low absorption and reluctance toward modern technologies. Technology itself, understood as the way of preparation and execution of given good or information seems to be neither good nor bad. It is usage of given technology that stratifies the values people attribute to technology.

One of areas for conscious technophobia prevention and alleviation is user experience design based on consumer research at early stage of new technology design. An example of such fear-preventing approach is are autonomous vehicles of Waymo that resemble  toys, that many people remember from their childhood.

People fearing technologies can keep up with trends through dedicated portals, such as TrendWatching, TrendNomad or blogs and podcasts, good example of which is The Medical Futurist led by Bertalan Mesko dedicated to care delivery of the future. They can also consider enrolling to massive open online courses or postgraduate studies dedicated to this topic e.g. Technologies and Processes of the Future led at Warsaw School of Economics.

Instructions and explanatory videos about various technologies, available at Youtube can also help in the daily practice of harnessing technologies. Also, more and more technology providers offer virtual helpdesks  and educational info-lines for existing and prospective customers.

Area that requires special dedication are educational and social initiatives channeled toward elderly, such as Intra-Generation Dancing initiative, where elderly learn to use new technologies for virtual meetings and activities, needed so much in particular in times of recent pandemic.

According to OECD 9% of work places in 20 most developed countries of the world is at risk of automation. In parallel populations of these countries are getting older dynamically (forecasted 53% at 65+ age in 2050 versus 28% in 2015). Report of OECD indicates that 60% of people in productive age does not have sufficient capabilities for jobs that are being created. The lack of capabilities relates in particular to usage of modern information and telecommunication technologies. Capabilities needed to keep up with new job opportunities worldwide, according to a report of World Economic Forum, relate to robotics, big data, machine learning, augmented intelligence, digital transformation, and processes automation These capabilities are active learning, complex problem solving, new solutions design and innovation thinking. In conclusion, the remedy for technophobia is continued learning to understand and use new technologies for the purposes that matter, such as sustainable development and higher quality of life in good health.

1st version of this post has been published in Polish in SGH Newspaper on 30.11.2020. Feedback received, encouraged me to work on its English edition published here.

How to Run Lean and Agile at the Same Time?

Frameworks for projects delivery or products development are like multivitamin pills – they offer plethora of elements and compounds you can select from depending on your need or challenge. After years of practicing lean and agile frameworks I concluded that there is no conflict between the two – on the contrary, you can benefit from both in the same project depending on its stage and work requirements.

Nevertheless, let us start from the basics – fundamental approaches in project management are  either oriented on linearity, sequence orientation and processes, or  oriented on people, their expectations, priorities and management of dynamics related.

The first approach  used to be called waterfall approach, and it was well recognized in project management methodologies such as PMBOK, PRINCE, PRINCE 2 and Lean methods (all of them in recent years are incorporating principles from the second approach we will define in a second). The beauty and power of waterfall approach lies in orientation on sequence of the tasks to be performed and processes enabling them. Processes can be visualized (using e.g. Business Processes Modeling Notation language) – and what can be visualized can be discussed and improved. Switching the balance to the processes in waterfall approach makes work and teamwork constructive, if the team  acknowledge that seeing, analyzing and improving processes is what they should pursue.

I like the lean method due to its orientation on process improvement, and its mindset proving that whereas it is almost impossible to change other people’s minds, it is much more easy to agree on visualizing, aiming to understand and improve the process or solve the problem (especially so called root causes behind the problems) in continuous improvement environment. Key rituals and artifacts from lean approach I’ll keep forever, refer to them often and try to use daily are Kanban, Andon, 7/8 waste and 5/6 s. Andon is stopping the process where every next step could only accumulate defects spotted right on 7/8 waste is looking for and eliminating customer non-value adding activities from your work. To learn more about 5/6 philosophy try this lean game calculator available online and see short movie exemplifying waste elimination orientation in lean.

The second approach which proliferates worldwide in recent years used to be called agile (traditionally agility is defined as ability to move quickly, easily, intelligently). Project management methodologies in agile approach are much more than bodies of work or frameworks, as agility recommends allowing the context to determine deploying roles, rituals and tools from its repertoire. Recognized and respected agile product development methodologies  are Extreme Programming, Feature-Driven Development (FDD), Dynamic Systems Development Methodology (DSDM), Crystal and finally SCRUM. To feel the taste and right context of agile approaches I recommend you to imagine that there is a customer, which has some needs, let us call them requirements – and these requirements flow through your team. Now, in order to satisfy the customer and meet their requirements, you will organize iterative work (yes step-by-step with multiple feedback-loops and priority changes options). Key rituals and artifacts from agile approach that I try to use as often as possible are Kanban, asking for Voice of the Customer in the work (which in SCRUM is served by role of Product Owner), planning work using backlogs, and making it digestible in form of one or two week chunks (called in SCRUM sprint backlogs). Building your product basing on customer’s feedback in iterative way also key characteristic of lean start-up approach, which we wrote about some time ago (lean start-up method has much more to do with agility). Agile approaches welcome changing environment and circumstances gladly – they are oriented to respond to them quickly and effectively.

Using simplified sprint backlogs proved to me to be so effective that I even deployed it into other fields of my performance such as writing scholar papers with multiple teams and multiple quantity in the same time – SCRUM makes such contexts much more graspable and with feeling of control. I do not know any better introduction into SCRUM in timing less than 10 minutes than this movie – if you know such please do not hesitate to comment and share. One of the infographics that reflects agile approaches principles I like most can be found here. One of my favorite podcasts dedicated in great degree to understanding details of SCRUM is Manager Plus run by Mariusz Chrapko.

So – coming back to the title and beginning of this post – project delivery or product development methodologies are like multivitamin pills. Very often in one project you will work close with the customer to come out with solution (can be a new product or combination of products and services you already offer) – in this context you will benefit much from agile approach. In the same project, but at different stages like formal purchase, procurement or deployment of solution in customer’s organization you will need solid, understandable, replicable, process-oriented approach – and this is where you will benefit more using a  lean approach..

Practicing different project management methodologies, frameworks and bodies of work enabled me to formulate one more conclusion – related to managing polarities (famous management consulting concept with theoretical framework developed by B. Johnson in 90’s of XX century) where both waterfall approaches and agile approaches are not mutually exclusive, but mutually dependent. Neither of them enables to face current business expectations on its own, and maybe business-wisdom is about trying to manage and leverage them appropriating benefits related?

What is your experience with running both lean and agile?

Innovation Performance Controlling

Implementing innovation strategy within planned resources and estimated timeframe is what management control of innovation is striving to achieve. Management control systems differ depending on type of innovation, measures monitored, and role of innovation portfolio managers in decision-making. Key contemporary approaches for innovation performance controlling are The Innovation Value Chain, Innovation Scorecard, and Stage-Gate system.

One of most recent, widely adopted and used approaches is the The Innovation Value Chain formulated by M. T. Hansen and J. Birkinshaw. This approach focuses on such stages of innovation development as idea generation, conversion and diffusion, and applies non-obvious, adequate performance measures for each of them. For idea generation, key measures are number of high-quality ideas generated within company’s unit, number of such ideas generated across the units (to reflect in-house collaboration), and number of high-quality ideas generated from outside the company (to reflect contemporary open innovation paradigm). Conversion within The Innovation Value Chain is measured by percentage of ideas generated that had been finally selected for development and funded, and  by funded ideas that led to revenues. The last stage of diffusion is measured by percentage of penetration of new product in selected markets and its sales channels.

Another approach, developed by T. Davila, M. J. Epstein and R. Shelton is Innovation Scorecard. This approach focuses on structuring innovation process in logical order of inputs, processes, outputs and outcomes. Each of these elements has appropriate metrics to track. Inputs are measured by access to talents and commitment to innovation expected from employees. Processes are reflected by measuring balance in innovation portfolio and quality of innovation pipeline. Outputs are tracked by measuring the number of new customers, and achieving leadership in technology and innovation domain. Outcomes are reported by growth in sales and profits.

One of most common approaches in measuring performance of innovation is Stage-Gate developed by J. H. Hertenstein and M. B. Platt, which presents innovation as process of go/no-go decisions. Although it is a much older system than Innovation Scorecard and The Innovation Value Chain, it’s still much in use, especially in multinational technology companies. Stage-Gate understands new products development as a sequence of decisions with specific indicators required to be met at every decision step. Stage no. 1 within Stage-Gate is often measured by market research and feasibility, visualization and design development for new product. If these metrics are met in stage no. 2 new product undergoes technical development and prototyping accompanied by future production design and tooling. Once the decision after stage no. 2 is positive, in stage no. 3 product goes through production, quality testing and marketing campaign oriented for first orders/pre-orders. If results of this stage is successful, new product in stage no. 4 is audited for customer service/post production care and customers satisfaction.

Contemporary design of management control system for innovation in companies derives from above mentioned approaches and is often enriched by sets of financial and non-financial performance measures for new products development.

Typical dilemmas of innovation portfolio managers refer to timing of measurement – from the front end to market launch or later stages, areas of measurement – resources, time, costs, customer satisfaction, mix and balance between financial and non-financial measures, organizational level of management – units, departments, organization and details of measurement.

Measures reported by innovation portfolio managers very often refer to number of new products started, number of new products completed, number of products in pipeline, percentage of new features in new product compared to its previous version or substitute, and alignment of design with company strategy.

Empirical evidence about results of innovation performance controlling are at least intriguing. For example J.M. Bonner proved that upper-management control and interventions in process of innovation negatively affects innovation projects’ performance. What is supportive for project performance is however definition of goals, monitoring and evaluation between project team and top management in early phase of innovation project. Research performed by K. M. Eisenhardt and B. N. Tabrizi identified negative impact between time spent on new product planning and development time, and outlined supportive role of shorter time between innovation project milestones (enabling product iterations). M. Benner and M. L. Tushman researched role of formal process control in new products development and found that having formal process orientation within company such as ISO norms negatively impacts on exploratory type of innovation.

Too complex innovation controlling systems might constrain creative behaviors; underestimate innovation output in open innovation paradigm. On the other hand they increase efficiency of the processes, coordination between teams, fosters organizational learning.

So what is your innovation controlling approach?

Collaboration strategies – how to partner right?

One of principle rules in attracting external resources to a starting-up enterprise is to make its expected profits highly plausible to interested parties, including investors. One of approaches toward de-risking planned activities is to bring attention to formal partnerships formed by the company. Having a right partner might increase chances for start-up’s commercial success and decrease its operational costs. So what are the most common dimensions of collaboration in starting up phase of business activity?

Crucial dimension for future commercial success of a start-up relates to its ability to interest, cooperate and receive orders for its goods, services, or solutions. One of the ways to make these aspects plausible is through working out and signing a document confirming pursued and shared declarations e.g. in form of letter of intent (LoI).

Purpose of LoI is to express in writing will of parties to explore together items they agreed to, and to declare officially that parties know each other and are negotiating. Usually final agreements resulting from LoIs take form of separate, legally binding contracts. LoIs are usually “soft” documents in terms of their legal power, can be general in terms of what they express, but still provide formal proof that parties are looking into more detailed ways of future cooperation.

You might find different examples and naming conventions for letters of intent, such as declarations of cooperation (DoC), memoranda of understanding (MoU), but what is common for all of them is that they are signed to declare intentions, which does not always have to  be finalized. Typical letter of intent should cover purposes for expressing intent by parties, scope and responsibilities of parties, organization and governance including representatives, and clauses such as non-binding effects, intellectual property, and confidentiality. You might find some examples of such documents in this place.

Letters of intent are not only signed with expected, future customers. Deriving from lean start-up approach we wrote about before, to lessen the costs of operations for start-up, letters of intent can also be signed with parties interested in running trials of products, services or solutions that are under development, parties expressing interest in testing a prototype, or parties interested in distribution of ready goods, services or solutions.

Depending on how advanced a start-up is, purpose section in letters of intent can range from exploration of joint business models, through detailed ways of cooperation in business development, even to declaring pre-orders once product, service or solution start-up is working on is ready (which is pretty strong confirmation of demand on start-up’s offering). LoI can also help a start-up to play the long game with big companies, which intent could be to find fit in cooperation model within agreed period of time.

To structure potential discussions on business models and to name them in your LoI you take a look into over 50 business models elaborated on by O. Gassmann, K. Frankbenberger and M. Csik in “The St. Gallen Business Model Navigator”, and also nearly 150 business innovation tactics shared by by L. Keeley, H. Walters, R. Pikkel and B. Quinn in “Ten Types of Innovation: The Discipline of Building Breakthroughs”.

Elaborated proofs can supplement another “stamps” looked for by investors such as certificates of attendance or completion a start-up acceleration programme or awards received from relevant communities or bodies. Altogether, they minimize perceived investment risk.

Having letters of intent signed by a start-up with couple of expected customers proves to potential investors that start-up’s offering raises interest, and demand for starts up’s value proposition is validated. These aspects might positively affect start-up valuation in its pre-market phase, which we wrote about some time ago.

Another way to demonstrate collaboration maturity of a start-up is to be able to license in part  know-how or technology needed, especially if it’s more beneficial than inventing new know-how or technology. Licensing-in, or in other words purchasing part of know-how or technology from existing entity can impact on perceived value of a start-up and foundations of its business (especially if part of know-how or technology is purchased from reputable entity). Finding entities offering know-how or technology of start-up’s interest should be part of state of the art analysis performed at early stage of product, service or solution development done with sources such as registered intellectual property databases we wrote about earlier.

Searching for a  right licensing-in partner through research queries in intellectual property databases can also lead to identification of potential customers and business partners. Licensing can also be done the other way around – in licensing-out form: from a start-up to external parties. It can make sense if a start-up has intellectual property, which is properly protected and can be licensed out without harm to future strategic position and profits of a start-up. Licensing out a part of know-how or technology can become separate stream of revenues needed at early development stage. Licensing agreements usually define fields of use of know-how or technology licensed out, rights which are granted, and rights which are retained (which ca be e.g. further research and development right to the subject of license). Therefore, rights to the same invention can be licensed out for multiple contexts and expected usages to many external parties. You can find supportive resources relating to licensing at website of MIT Technology Licensing Office in this place.

The last collaboration strategy we would like to briefly deliberate upon is outsourcing. Outsourcing usually relates to contracting out part of activities of an enterprise, which are not distinguishing in terms of capabilities represented by an enterprise itself. However in context of a start-up contracting out part of work to specialized organizations can again be a factor determining perceived value through teaming up with specialized partners. This can occur if parties contracted out demonstrate excellence in what they do and are responsible for resource-effective delivery of elements of product, service or solution offered by a start-up, belong to collective research organization (such as TNO, Fraunhofer, VTT), or specialize in rapid prototyping and production (such as RDLabs).

Collaboration strategies we have presented can take form of formalized expression of declared will, licensing-in and licensing-out agreements, outsourcing contracts, awards, certificates of attendance, or completion of relevant programs. Demonstrating ability to collaborate decreases risk of doing business with a start-up, impacts on chances to attract investors or being awarded a grant by grants awarding institutions. So which collaboration strategy is for you?

Disciplined Art of Scaling-Up

In previous post I’ve covered topics related to business formation and new market entry, incl. business model development, prototyping minimal viable product or service, valuating new venture, making it investable, and getting founded. In this post, I relate to a phase of company’s development following market introduction –so called growth phase.

G. Duruflé, T.Hellman and K. Wilson in From Start-Up to Scale-Up Examining Public Policies for the Financing of High-Growth Ventures define scale-ups as start-ups that have successfully established market presence and experienced rapid growth.

For the sake of this post let’s assume that new market entrant finds itself in the growth phase when its product has been already tested and market demand for it exceeds its initial operations capacity. Growth phase for new ventures is intrinsically related with phenomenon of scaling-up – enlarging market presence and growing company’s operations capacity,  understood as ability to manufacture and deliver product or service.

Scaling up has been recently wider discussed in entrepreneurship and innovation policy making discourse. This phase of growing new businesses has proven to be critical for their survival and performance, and is often backed-up with new employments. Growth is also a phase when many new companies become overwhelmed with unexpected and surprisingly high demand for their products and services, and due to that they often fail by loosing production capacity or financial liquidity.

Scaling-up requires different set-up of methods and tools from public entrepreneurship ecosystem stakeholders. Recent research results published by Innovate UK pointed out factors contributing to successful scaling-up process. I’ll focus on those I find the most challenging and crucial – people, strategy & cash.

As strong management team is critical to a successful scale-up, company founders need to enlarge original team to find time for other matters, such as e.g. strategy. This requires recruiting right people and avoiding miss matches. One of approaches that helps that is value-based recruitment focused on assessing match of candidate with values and culture of the company.

Why it’s important to focus on values? They seem to be often inherent, whereas skills can be learned and mastered. In value-based recruitment you might request the candidate  to imagine they come back home extremely happy and excited after work in your company and then ask to explain to you what could have happened during the day in the firm so they feel like that. You’ll learn also learn about their values, motivations and development plans by asking what could have happened if they came back home sad and depressed.

In scaling-up phase you’ll rather follow lean approach toward recruitment which is also about using your network, asking for references and second opinions to find right candidates. You can find some more tips related to growing team in early stage venture at blog of Ben Yoskovitz.

In relation to people in growing phase you are also in situation of thinking on more or less formal organizational design, which might vary from functional, divisional through matrix ones – at least before maturity of your organizational allow you for to self-organizing teams and give individuals broad freedom to choose their own priorities and tasks. It’s also the moment you intensify thinking about harmonizing individual efforts toward defined goals of organization through set up of objectives and performance indicators for your co-workers. Some food for thought in this context comes from Peter Thiel – co-founder of Pay Pal we wrote about some time ago.

Second important item related to scaling-up  is strategy. By strategy I understand not getting first paying customers, but rather rigorous way to answering the question on where you’d like to be in the marketplace and how you’d like to get there in time for 3 to 5 years. You get there through strategy development process requiring formulation of ideas & options, their evaluation and selection, setting up main strategic direction backed up with clear objectives, resources you control and action steps you set-up and execute. And yeah, if you offer acouple of different products or services, you develop separate strategy for each and every of them.

Business strategy is not the mission and vision your customers will find on your website. When the outcomes strategy development start saying about market share you plan to own and profit margins you want to achieve – that will be pretty close to what business strategy is about. After time when you get convinced it’s your biggest trade secret embracing insights and know-how straight from the crater – you are there.

Here you’ll find some tools pretty useful in strategy development process, especially for market-position analysis part, which precedes discussion on strategic development directions. Some other approaches useful for analysis of your competitive environment might incl. Porter 6-forces, product life-cycle, or benchmarking. You can also get answers to questions asked by rigorous application of SWOT analysis framework.

Although the process and tools might sound abstract, as entrepreneur you should take your first steps to have strategy developed. Just consider to designate small strategy development team of your employees and ask them to meet regularly for advancing strategy formulation. In between, they can talk with vendors and customers and prospects, research competitors, and try some strategy development tools , which anyway will lead you further than not trying to tackle strategy at all.

As noticed by V. Harnish in Scaling Up nothing consumes cash as fast as growth phase. Therefore third most important ingredient in scaling-up  is cash flow management. V. Harnish advices a proactive approach toward management of growing company liquidity through conscious cash flow management and building reserves through e.g. dynamic pricing, competitive sourcing, lowering operating costs, collecting due amounts faster, reducing inventory and acceptable delaying payments to others. Some concrete practices the author recommends to consider relate to preparing in advance and sending error-free bills to customers on time or keeping 60 days’ cash on hand to cover potential expenses and avoid difficulties, which in scaling-up  should never be fixed with lines of credit.

Some non-obvious ideas for lowering operating costs and increasing company’s performance can be found in Exponential Organizations written by S. Ismail, M. S. Malone and Y. van Geest. Authors preach approaches of smart partnering, exploiting and leveraging other people’s assets and resources if one have none, using games, challenges, quizzes and competitions to tap mind power of people in their communities and engaging them in creating value which originally was though as something to purchase from the outside.

So, in what stage of development is the venture you support?

Design Thinking – Think Big. Start Small. Move Fast.

Design Thinking, traditionally used by architects and designers, recently gained popularity in business, in which it is applied to define new business models and to plan start-ups’ acceleration. So what’s design thinking is about, and how you could apply it to what you do?

Design thinking means not thinking in sequences, as in typical linear thinking process. At least it’s not what design thinking as a process starts with. In practice of design thinking you move through different mental states, as Tim Brown explains in Change by Design. During this process you use divergent thinking – to create and list options of what you work on resulting in more choices, convergent thinking – to sort and rank options you come to and rank them in order, and finally analytical and synthetic thinking –first to identify some patterns, which popped up during the process, and later to better understand and reassemble them in a meaningful way; so you can incorporate them in what you design.

It might sound pretty abstract, but in practice it is not, especially if you imagine that practicing design thinking relates leading it in a workshop environment, engaging participants with various experiences, including existing and expected customers, to leverage their different points of view and distillate the essence for desired customer experience.

Design thinking is particularly applicable when you project an experience that your customers desire to go through while they search for, purchase, and use your product or service. You can also use it to improve existing products or services to make them more appealing or functional, and to better production and interaction processes.

Nurturing, stimulating, and extracting ideas from design thinking session participants is essential. In order to do that V. Hasley, author of Brilliance by Design, advises to feed the participants with right pre-work before planned session by using videos, podcasts, recordings, workbooks, and lists of questions to reflect upon prior to the session.

Sharing points of view during design thinking session can be about distributing and gathering filled as many sticky notes as possible, but also cutting out pictures from various magazines and newspapers and pinning them to a prepared poster board, or creating your own magazine from headlines and drawings, so you can picture discussed vision.

Its critical to encourage each participant to speak up, share, and contribute during the session. Nothing should prohibit answering at once, reciprocating with careful observation, and listening with empathy, as ethnographic and anthropologic observational techniques stand behind design thinking.

In order to design an ultimate experience you’d like your customers to go through, design thinking uses storytelling, because when customers talk about experiences they tell stories. This is what distinguish design thinking from other marketing techniques, as it doesn’t use customer’s questionnaires and surveys.

Listening to the stories enables you to identify connecting threads, which is essential for design thinking process.

As Patrick Van Der Pijl, Justin Lookitz, and Lisa Kay Salomon noted in Design a Better Business, during design thinking session customer stories are often recorded or videoed, as the key in design thinking process is to discover not only explicit needs, but also non obvious tacit and latent needs relating to what could annoy but also delight your customer.

To add business applicability to results of this stage of the process, you need to organize and evaluate generated ideas. In order to do that, you can draw simple matrix where horizontal axis start with ideas that generate costs and end with those that generate revenue, whereas the vertical axis will start from ideas that are incremental, and end with those that are substantial. See example of such matrix here.

In designing desired experiences, once options are identified and ranked design thinking uses prototyping that enables to create and test expected solution together with your customers in resources efficient approach. According to authors of Design a Better Business what works best are Lego bricks, but you can also use cardboard, paper, napkins, glue, tape, toys, and sticky notes, as they spark creativity to top the process.

Prototyping can also have form of virtual trials. If you design an event you might design several variations of event tickets to find which would work best among targeted audience. In designing a webpage for your business, you could do the same to see which variant would be preferred and attract more visitors. Rapid and cost efficient prototyping as such can also derive from lean start-up approach, which I elaborated on some time ago here.

Prototyping leads us to another key aspect of design thinking–testing the assumptions, which not only need to be listed in order of expected contribution to your success, but also in order to identify the riskiest ones. To do that design thinking uses multiple “why” and “what if” questions toward expected and existing customers to understand their ambitions, needs, priorities, and finally to rank the key assumptions by importance for designed success.

As Jeanne Liedtka and Tim Ogilvie in Design for Growth explain one of the most important elements of prototyping in design thinking is customer co-creation, which is about engaging customer into asking specific question and providing concrete feedback to prototyped products or service incl. options they would choose and improvement they would apply.

One of the brightest examples of design thinking practitioners I admire is Mayo Clinic Center for Innovation operating in Mayo Clinic in the US, which is one of the most renowned leaders in health care. Mayo Clinic is nonprofit organization running medical centers and research organizations with over 57 000 employees and over USD 700 mln research, development & innovation budget. Practicing daily design thinking by Mayo Clinic Center for Innovation resulted in multiple implementations of improved services and processes in Mayo Clinic, such as The Smart Mirror in bathrooms for older patients providing electronic reminders on prescribed medications, Asthma Connected Care App enabling asthma patients to communicate with healthcare provider, or Jack and Jill Rooms, which are medical examination areas redesigned to enhance comfort of patients.

Those who would like to deepen secrets of design thinking and start practicing it in business context can study facilitator’s guide from Institute of Design at Stanford, or take Design Thinking for Innovation MOOC available at Coursera.



Platform Economics – What Matching Users is About?

Nowadays companies can reach valuations exceeding billions of dollars and deliver value the customers look for without even physically owning resources they trade. In times when access to resources is becoming more important than their ownership, economists debate whether we should call this phenomena a sharing economy, community marketplace, or simply uberization of everything.

So what common principles stand behind DogVacay enbling to browse, book & pay for a pet sitter or dog walker, WeWork allowing to find office space or shared desk in city of your choice, or Zilok letting you rent anything ranging from a car through gardening tools to venue for an event?

All these businesses are platforms active in specific, two-sided markets with distinct user groups, who look for specific benefits. Therefore we can call them two-sided platforms. DogVacay matches pet owners with pet sitters, WeWork intermediates between office space and desk owners and office workers and freelancers. Zilok arranges interactions between various lenders and borrowers concluding in transactions.

Principle reason for two-sided platforms to exist is need of intermediary able to match user groups in more efficient way than using traditional approach. In Matchmakers. The New Economics of Multisided Platforms D. Evans and R. Schmalensee explain that connecting buyers and payers in virtual place enables sales, and therefore platform operators can fairly charge for it. Platform intermediaries minimize costs which alternatively users would have invested in traditional research, reviews and recommendations. By doing this platforms organize, simplify and standardize market activity making it easier and cheaper. For example, Airbnb enabling rental of apartments  in over 190 countries in the world charges both hosts and guests which altogether might cumulate in double digit transaction fee earned by Airbnb platform operator from single reservation made.

For providers of goods (e.g. cars, office desk, gardening tools, event venues) and services (e.g. walking the dog) two-sided platforms might become source of alternative and often recurring revenue, and all what is needed is allowing own resources to be advertised and rented.

If you’ll ever consider entering platform business do know that their value strictly depends on the number of users both those whooffer the product or service and on those who are seeking it. This concept is broader known as network effect and the more users you have the more they will pay you to access to bigger network and your margins will improve. This is how LinkedIn intermediating between employers and employees maximizes its platform revenues. On the one hand it offers freemium account for all professionals, who would like to leave their job curriculum online, on the other it charges recruiters , who are eager to pay to browse millions of users. Employees looking for a way to distinguish among other half of a billion of LinkedIn registered users are also eager to pay fee for that. Therefore even if small percentage of your growing user base is eager to pay you can be profitable.

As there are many types of two-sided platforms you might be interested in their typology. Transaction platforms represent one which intermediate in facilitation of exchange of goods and services or transactions between different users, buyers and suppliers. Non-typical transaction platforms are time banks, such as Time Republic or Japanease Furei Kippu schemes.

An innovation platform is another type of two-sided market platform matching owners of challenges or problems to solve with inventors or solvers. These platforms nurture creation of innovation and open communication of solutions looked for. One of the most popular platform of that type is Innocentive, which I wrote about some time ago here.

The last type of platforms I want to bring to your attention  are investment ones that enable you to invest into prospecting business or to be invested in, as in example of crowdfunding platforms, or peer-to-peer lending ones represented by Upstart.

As we might recognize platformization of economy as certain trend, what are the strategies for attracting and building solid base of users to capitalize on two-sided platform business? G. Parker, M. Van Alstyne and S. Choudary detail couple of such strategies in Platform Revolution How Networked Markets Are Transforming the Economy and How to Make Them Work for You.

One of such strategies is “The piggyback” where you need to find an existing platform to connect with its current users. By doing this you lower costs and time of user acquisition time. PayPal initially was available as payment option for eBay users and afterwards it easily  became online payment standard. Another strategy is called “Follow-the-rabbit”. Here you need to set up a pipeline with demonstration project proving your business model can succeed. You charm initial base of users by offering them freemium account and capitalize on other type of user. By growing up significant users base using freemium model one day you might represent dominant standard in the industry, and then start charging for platform usage. “The micromarket” is one where you select niche but influential target market with users, who already interact and by growing this micromarket you gain access to larger one.

What I remembered from my MBA studies from classes on two-sided market platforms with Dr Gal Oestereicher-Singer from Tel Aviv University is that winners in  platform usually don’t have  the “best” product, but most often they have the “best” platform strategy. And this also requires using open (but not too open) interface, modular architecture enabling easy extension of platform functionalities and compelling complements.

So what is your platform strategy?



Project Management 3.0 and Large Scale Projects

Current definition of a project has evolved from temporary endeavors undertaken to create unique product, service or result, as described in PMBOK Guide, to collection of sustainable business values scheduled for realization as defined by dr Harold Kerzner in one of seminars at International Institute for  Learning I was privileged to attend.

So what has changed since project management (PM) emerged as an approach in professional work?

In the beginning, project managers were required to have at least a diploma or PhD degree in engineering, they reported to line managers, projects they led were measured by achieving goals in line with time, costs, and scope, project teams were usually co-located, and results were communicated in formal reports. In the beginning, top executives didn’t trust project managers as much as they trusted line managers, who were supported by project managers.

Nowadays project managers don’t need to have a diploma or PhD degree in engineering, but they need to know how to create unique business value for customers. They are working with virtual and distributed teams, and report their outcomes in informal dashboards. Today project managers are responsible for strategic projects and often report directly to senior management of companies. Executives started trusting project managers as project management has become a strategic competence of a company, needed for its survival.

For example IBM, which in 2010 officially had 26 000 project managers todays has 46 000 of them, company runs multiple centers of excellence for project management and best practice library to spread lessons learnt by the employees. It illustrates that multinational corporates are not in simple B2C, B2B or B2B2C anymore, but in project-based business, and businesses are managed by projects. I believe that solid project management skills are vital not only for multinational corporates, but any start-up, which want to scale-up and actively compete.

What has changed in project methodologies used by project managers?

In the past most of project management methodologies emphasized planning of project scope in line with project time and budget. In such circumstances project management methodologies such as PMBOK, or PRINCE 2 were sufficient to successfully deliver project with their classic project stages of initiating, planning, executing, and closing. Nowadays, even if project time and budget are known, its scope evolves and iterations in planning and execution stages become natural parts of every project. That required of project management frameworks to be more flexible and adapt philosophy of agile and techniques of scrum methodologies, which were initially used only in information and communication technology (ICT) business. Skillset of contemporary project manager needs to derive from best practices of various project management methodologies, as projects become more and more complex in terms of resources and stakeholders management and bigger in scope.

How future of project managers will look like?

Taking a look at project management evolution, we can easily say that future project managers will need to adapt to changes in projects scope quicker and without waste. In the past one of key project management principles said not to start the project unless scope is well defined upfront. Nowadays no one is surprised with evolving and changing scope, and projects are being executed even if they are not clearly defined. Project managers will be expected not only to deliver project status, progress, and forecast reports, but also assess benefits and value for project stakeholders at project’s completion.

Informed decision making will require rapid sharing of project metrics and its key performance indicators (KPI). These KPIs will be needed to create customized project dashboards illustrating the progress of a project in a way that is easily understood. In the past project’s success was measured in profitability. Today its measured in customer satisfaction and business replicability. In the future it will be measured against business value tracking metrics.

Key drivers for projects will be defined not only by costs and profitability, but also by alignment with strategic objectives of companies and maximization of benefits and values for the customer and company itself. Companies will switch from implementing individual projects to integrated portfolios of projects.

It means that project managers will have to constantly update their qualifications as well as guidelines, templates, and checklists they use. Technology and ICT-based solutions will play more important role in project management. Usage of mobile devices in project management will become more popular, and project-specific applications will be created.

Reporting of project management will switch from reporting to senior management to reporting to executive boards of companies. Whereas in the beginning expectations toward project managers in companies were rather low, in the future more and more often they’ll be expected to do the impossible.

How technology can help project managers and companies to evolve into Project Management 3.0 paradigm?

At this very moment more than 10 000 software developers worldwide works on project management software and tools to make engagements of project managers smarter.

If you still feel a little bit lost with project management methodologies and frameworks, before you read further download Beginners Guide to Project Management Methodologies by Wrike free of charge.

In less than 30 pages you’ll learn about common project management methodologies incl. their advantages and disadvantages – incl. Agile, Critical Path Method, Kanban, Lean, PRINCE 2, SCRUM, or Six Sigma.

As explained earlier, today’s project manager needs to derive from best practices of different methodologies and frameworks. One of the courses addressing such requirement is offered by Simplelearn in form of a dedicated course focused on Large Scale Projects, which might be particularly useful for project managers in start-ups, which enter scale up stage. Course delivers functional knowledge mix deriving from project methodologies basing on PMP, Agile, SCRUM, Lean Six Sigma and tools such as MS Project.

One of simple, but extremely useful project management tools supporting distribution of work and time for delivery is offered by Trello, in form of a board deriving from Kanban approach, illustrating tasks as to do’s, currently being implemented, or done. With one look at Trello board project managers know where they are with tasks completion, can comments on progress, or share files from hard drive, Google Drive, or One Drive. As Trello is free of charge, our operations management students at Warsaw School of Economics use it to report progress with term papers prepared in project teams.

You can also manage your project and your team visually in a single board with Dapulse, which enables to distribute tasks in form of to do’s and turning them green when they are complete. Thanks to Dapulse project manager sees who is busy, and who is not, and can reallocate team members to tasks requiring stronger focus and support.

Another tool enabling instant project status updates for everyone, anytime and anywhere is Leankit. It’s a visual project delivery too  enabling teams to apply lean management principles to their work, applying Kanban to Waterfalls principles to eliminate waste in project and move forward continuously.

More advance tool called Confluence is offered by Altassian. It enables not only collaborating on projects but also growing teams and teams’ knowledge by capturing and managing team meeting notes.

Keeping track of work from desktop or mobile device is offered by Huddle, which is a cloud-based workspace that enables adding tasks and requesting for approvals. For project manager, who has distributed work around project team members it enables to overview who has accessed and contributed to particular items.

One of pretty advanced tools to manage and automate collaborative work is Smartsheet. It has interface of a spreadsheet that most of us are familiar with, and enables real-time collaboration and streamless communication in sharing work, collaborating on specific tasks, inviting people to collaborate, and sending them attachments, notes, and comments. All project-related content is centralized and accessible from a browser, a mobile device, or a desktop. Smartsheet utilizes alerts and reminders that automatically notify you when changes are made and when key milestones in project are started or finished. It also presents utilization of project team members, what fosters resources management.

Solution going further than Smartsheet is offered by Mavelink in form of a project delivery cloud, which not only encompasses majority of functions o project management tools described earlier, but also enables to utilize project plans into reusable templates ,that you can share with other project managers and project teams.

If your start-up has scaled-up and becomes a corp-up you’ll love Workboard. Its project management solution for business run on quarter-by-quarter basis. Workboard show you a full picture of your business, including plans and progress across your organization and results against KPIs, which will help you to stay focused on what’s important.  Thanks to Workboard you ’ll be able to visualize alignment and dependencies across organization and have all the details delivered in real time for your iPhone or iPad or web browser. It offers automated status reporting and can be integrated with other work cloud systems such as Salesforce.

But what if you are solopreneur, and all these tools seem to be too big for you?

In that case you might be interested in Handle, which helps individuals to turn emails into to-dos, make voice notes, schedule and prioritize to-dos, add reminders with due dates and locations. With Handle you’ll see to do’s and your calendar items together so you know what to do and when. Handle will also help you to distinguish things that are important from those that are urgent.

If you really into project management topic you might be interested in Project Management Days 2017 at Warsaw School of Economics in Warsaw, Poland between 19th-21st of April 2017. I hope to see you there!







How Start-ups Disrupt Insurance Business?

Recently researched insurance providers acknowledge that their business is undergoing massive disruption. It occurs due to insurance technology (InsurTech) start-ups, which overcome regulatory issues quicker,  understand platform economics better, dig out market insights deeper, and deliver customer experience not available before.

What is there for insurance holders?

If you are a car owner who pays their car insurance each year and doesn’t drive that much, you might feel insurance prices are a little bit unfair for you. Metromile proposes pay-per-mile car insurance model, which results in less money spent on insurance for those who drive only occasionally.

Extensive drivers might be interested in comparing vehicle insurance offerings in their area before they decide which one to purchase. Everquote provides such quotation, comparison and connection of drivers with insurers in their areas.

Goji also aggregates insurance company’s data in once place and presents you low price insurance options based on your car, driving profile, and needs.

Drivers, who insure their cars, but want to avoid situation when issuing insurance claim is needed might appreciate Zubie. Zubie promises to make your car exploitation smarter by enabling scheduling maintenance alerts, providing trip analyses, and delivering driving style feedback for greenhorn drivers.

Benefits offered by companies are also the domain of InsurTech disruptors. This area might be particularly interesting for companies eager to attract and retain employees, for whom personalization of benefits portfolio matters. Liazon enables employees to configure their non-financial benefits mix including health, lifestyle, saving plans, and of course insurance items.

Stride Health enables employees to optimize and manage health & dental services on their mobile devices, and also offers concierge and preventive services aiming at discounts and savings for their customers.

Those who travel with their valuable items could be interested in Trov. Company offers on demand insurance for damages, losses or thefts for laptops, tablets, digital cameras, and music instruments.

Insuring cars, travels, real estates or business activity might not be easy, and people often need solid advice with human contact. Therefore Coverhound, PolicyGenius or Finance Fox along with identification of insurances matching customer needs provide you with time of licensed advisors to walk you through them. As advising on particular insurance product could be biased by commission fee received by advisors from products sold, these companies transparently explain how they remunerate their advisors.

Some InsurTech start-ups focus on single product and specific type of customer. On of such is Ladder Financial providing value for customers interested in personal insurance. Artificial algorithms of Ladder Financial deliver initial insurance quotation matching person’s profile and needs within blink of an eye. Issuing insurance policies takes place online and is backed-up by existing, reputable insurance companies.

Quotations of personal insurance policy on demand, which take into account vide tapestry of people professional profiles are offered by Next Insurance.

What is there for insurance carriers?

InsurTech start-ups haven’t forgot about companies thattraditionally have been offering insurance policies.  EIS Group for example offers a multi-line insurance platform, which fosters customer’s relationship management (CRM) of insurance carriers. It’s modular in design and support processing policies, billings and claims, offer analytics, and enable engagement with customers within whole insurance lifecycle.

Acquisition, retention and growth of customer base is essential in every business. For companies that use call centers in daily operations with their customers Cogito offers solution enabling real-time analysis of phone conversation to provide immediate guidance for better engagement and connection with customers.

One of the most important parts of operations management in insurance business is claim management, which relates to request to insurance companies for payment relating to insured incident, damage, or loss. Snapsheet offers technology that enables settling claim between insurance holder and insurance carrier in virtual environment.

As claims to insurance companies are often unjustified, and might be an object of frauds, Shift Technology provides insurance carriers with artificial algorithm analyzing insurance claims to prevent such situations.

As insurance business in essence is about managing calculated risk, some carriers might appreciate proposition of Cloudcover with virtual risk diagnostic analytical tool and real-time risk visualization panes enabling advance risk analytics.

Calculating risk is crucial to determine insurance policy terms. Therefore in certain types insurance use drones or satellite images, which enable to predict certain events impacting on risk. Orbital Insight for example offers analysis of millions of satellite images at a time, which can support anticipating crop, or oil shortages, predict deforestation and other natural and social disasters.

What is there for InsurTech start-ups?

InsurTech start-ups require good orientation in regulated environment to hone their MVPs and run pilots of their products. Innovation ecosystem stakeholders, which might be supportive here, include company builders or start-up accelerators partnered with insurance companies. One of InsurTech company builder is FinLeap, which seat is in Berlin. FinLeap provides access to specific technical consulting, development platform, stakeholders’ network, and also up to EUR 5 mln seed financing.

One of star-up acceleration programs focused on InsurTech is Huge Thing organized in Poland with application deadline at 2nd of April 2017. 10 start-ups qualified to the program will experience mentoring from one of the biggest financial institutions in Central and Eastern Europe and travel to Berlin and London. They’ll also be able to apply for EUR 45k equity free investment within the program.

What will be the next InsurTech big thing?


What Lean Start-up is About?

In recent years lean start-up approach gained recognition and has been widely used by entrepreneurs and start-ups offering products and services that have not yet been tested on the market.

So what lean start-up approach is about?

According to H. Love, author of The Start-Up J Curve, ideas represent only 5% of the total value of a new enterprise. What counts more than the original concept of the product are iterations  and customer feedback, which is worth more than customer sales. Therefore key idea of lean start-up approach is to expose early version of your product  to potential customers, to gather feedback, and to implement  rapid and possibly waste-free adjustments of your initial proposition to create something that is closer to what the customer really wants.

According to lean start-up approach the first step to create initial customer demand is to establish your Unique Value Proposal (UVP). UVP is nothing else than a list of problems that your product will solve for your customers, or the difference it will bring to the way customers problems are solved right now, and answer to the question why people should pay you for it. Once you create such a list you can interview your future customers.

To understand deeper what concrete aspects of your product  will satisfy your customers, you can use simple questionnaire or a Kano model, which provides structured framework for analysis of importance or each of your product’s  attributes. Results of analyses based on Kano model determine which attributes of the product  are responsible for “wow” factor, and which of them could be the source of frustration if not tackled properly.

Another approach often used in marketing of new products is conjoint analysis, which enables to holistically measure importance of your product attributes. Results of conjoint analysis will determine how important is each attribute and what trade-offs you can afford.

Once you establish your UVP you are ready to create Minimum Viable Product (MVP) that, according to lean start-up approach, is the first visualization of your UVP. In other words MVP is the first prototype, or even a mock-up consisting of schemes, pictures, slides and videos you can use in further interviewing and gathering feedback from your future customers.

Ash Maurya, author of Running Lean, Iterate from Plan A to a Plan That Works recommends lean start-up practitioners to work with future customers from the very beginning. In terms of minimum number of interviews with your future customers Ash Maurya recommends to meet with at least 10 prospective customers to talk about UVP—problems and challenges you plan to solve and planned features of the solution—and then, with another 10 once you revise your first UVP. After that, you should be pretty well equipped to create your first MVP, which you also need to demonstrate to at least 10 prospected customers to gather their feedback enabling you to revise your first MVP.

After these meetings you should revise your UVP according to feedback received, incl. adding, eliminating, or modifying certain features. In lean start-up approach you open up and talk to customers as much as possible to observe how they interact with your MVP so you can polish it before market launch.

Lean start-up approach can be useful in wide tapestry of businesses. Ash Maurya applied it to write his book. Once, approached by readers of his blog who suggested that he should turn his

posts into a book, he contacted some of them and interviewed them on problems that the book should solve, and the blog did not. He created UVP by organizing workshops to gather feedback of more blog readers, who were potential customers. Then he wrote book in stages—first chapters of the book were his MVP. They have been released at early stage of final product creation, so he gathered feedback and reworked the chapters before final publishing of the book.

There is plenty of resources you can use while practicing lean start-up approach.

To find prospected customers and get into interaction with them  you can use, for example, LinkedIn, Ask Your Targeted Market. D. Olsen, author of The Lean Product Playbook How to Innovate with Minimum Viable Products and Rapid Customer Feedback recommends to use Mechanical Turk or TaskRabbit, which enable you to effectively outsource part of task related with iterations around MVP.

Once UVP and MVP are tested, and your product iterated, improved, and released you can derive from other lean start-up methods to grow your business. Ash Maurya advises to track and fix the barriers your first customers encounter as soon as possible, and to ask them for referrals, endorsements, and testimonials of your product. The last two can be published on your website to build greater credibility and traction of your business.