I recently wrote a post “Delving into a complex world- finding research to help you learn and adapt”. On reflection I should have replaced the word “research” with “time”……to help you learn and adapt.
Finding time is a real struggle and going that extra mile to read thought leadership views can be a step to far, I know but I can’t help myself, it is part of my job and certainly for me, many are really worth it.
In that post I was recommending Deloitte and their thought leadership as a good place to visit. Now I’m not sure how many of you actually did and it was suggested by “the man” in charge of this blog to pick out a few and make a post summary of these as ones that might be useful, so I’ve chosen two that challenge and break ground.
So I can’t compete with getAbstract or Soundview or many others, offering the service of learning a book’s key ideas in less than 10 minutes but hopefully the two I’ve chosen will beat the time it takes in this one read to cover what I feel cover two topical and important innovation thoughts of the present for many involved in innovation.
The two thought leadership pieces I have chosen.
Each of these are in the field of innovation so hopefully they will be of interest and raise your curiosity to dig a little deeper, if not then you have the key insights (from my perspective) here and that should be maybe enough to become more aware.
The two I have decided to summarize are 1) Beyond Design Thinking and 2) Minimum Viable Transformation.
Beyond Design Thinking
Written by Larry Keeley, president and co-founder of Doblin, Inc., an innovation strategy firm known for pioneering comprehensive innovation systems and the famous “Ten Types of Innovation”
Here he is discussing another really important system, about Beyond Design Thinking and let me pick out the key thinking within this article:
It opens with “Corporations have grown enamoured with design thinking” and although design is in the ascendance as it is powerful, effective and transformational if practiced or approached right, its trend needs examining. The key to design thinking is it begins by imagining a solution that does not exist yet, and then set about outlining a pathway to realizing it. Normally we make an assessment of a problem and seek correcting it.
What is at the heart of design thinking?
Design thinking has at its heart the generation of (lots of) ideas, build prototypes, try many things, build narratives about them, test everything, do more of what works and all the time show a clear bias for action, looking to shoot for the moon, or even Mars. All exciting, motivating stuff.
The creep is we are beginning to make design thinking a panacea - we start believing it can fix the ‘dry stuff’, the overly rational planning approaches to optimize around predetermined and deeply analysed market segments, we are actually abusing design thinking. Larry argues that certainly conventional approaches to planning are overdue for reinvention; design thinking is sometimes treated as superficial to truly deliver on grand expectations. It falls down attempting the wrong things or trying to fit design thinking into the events of the day.
Certainly I’ve seen or witnessed many brainstorming or management meetings that have asked along a design thinking expert, who pulled out of the hat, like the magical rabbit, a wondrous show to excite, determine and mostly fill an otherwise boring day. We all got terribly excited until the magic wore off and it didn’t make a scrap of difference. This is not what design thinking should be for.
It is crafting analysis with synthesis
As business rushes to embrace design thinking, it does move tradecraft beyond simply plain, vanilla analysis, it does embrace synthesis that helps build bolder and more newsworthy things. It can help firms build breakthroughs and contribute to the ‘genesis’ of profound insights and that alone can become the basis for an innovation team to put in the hard work of building (and validating) a breakthrough conceived through design thinking.
It is suggested in the article “put simply, analysis without synthesis is predictable and commonplace, design thinking without deep analysis is reckless.” It is seeking how to do both in integrated, even dazzling new ways.
To quote again: “when we have such highly contested markets….. it becomes a real skill to imagine a better world, make it tangible, build narratives about it and then work through the dozens of obstacles that anything new faces throughout its development”
Even more so “in a world where connectivity, collaboration, interdependence and user engagement all converge to build modern integrated ecosystems, where we formerly thought of industries”.
The quest for elegant integration of our innovation solutions
So Larry Keeley is suggesting within this article beyond design thinking we need to find “elegant integration” as effective innovations today are more about this elegant innovation of the known than the primary invention of the new. This is what is driving industry transformation everywhere.
The road ahead for the design field is three fold: use information deftly to manage complexity, great design is a critical catalyst and accelerant to the overall advance you seek and you should avoid labelling this design thinking as it is informed analysis, seamlessly synthesized into a coherent, beautiful solution.
As we transform from examples like Candy Crush, Alibaba, and countless others have as their shared property: they fuse together insights that come from sophisticated analytics, with experiences that are brilliantly designed to be easy, smart, convenient and entirely understandable.
That is where the power of design thinking turns products into platforms, offering deep solutions and your industry evolves into an ecosystem. It is down to getting all the parts right, needing analysis and syntheses to work together.
Minimum Viable Transformation
This is written by one of my favourite thought-leaders, John Hagel III, who has written here with Jacob Bruun-Jensen about minimum viable transformation and he has a follow up article of the same name over on LinkedIn focusing more on the edge to create new business value. Let me summarize the two, hopefully enough for it to make sense.
To succeed in today’s networked economy, businesses must participate in dynamic, evolving networks of diverse organizations. And while such networks can be difficult to navigate, they offer companies the opportunity to evolve their business models, deepen skills and knowledge, expand into new markets, and scale operations.
To stay viable amid accelerating change, businesses themselves must change more frequently—and in ways that use their business ecosystems as fertile ground for collaboration and transformation.
As an aside, I am spending increasing amounts of time on understanding ecosystems for innovation and its management, but that’s for another day.
Scaling edges that might become our new core
One method used to scale edges is minimum viable transformation. Scaling an edge is a promising arena that can showcase the potential of a fundamentally different, highly scalable business model that could even become a new core. Starting at the edge gives the transformation team far more freedom to test and experiment, and more ability to learn and react quickly.
Here, when we are at an edge, a company pulls together the essential elements of a new business model into a barely working construct, one specifically designed to test key risks.
Acknowledging and embracing minimum viable product principles
Minimum viable products, for example, are like prototypes—except that instead of being tinkered with internally, they’re immediately thrown at the market and subjected to trial by fire.
So why would a company do such a thing? The minimum viable product is all about identifying flaws and working to improve them as rapidly as possible. It’s designed not as proof of concept, but to test hypotheses and unearth unknowns that could sink a new offering.
For companies seeking to reinvent not only their products but their business models, minimum viable transformation allows for rapid iteration on the unknowns of a new business model—anything from minute changes to operational processes to full restructuring of the go-to-market strategy. At its core, it’s a strategy for gathering validated learning about individual business model elements, then assessing how those elements interact and combine to form one cohesive strategy.
The need today is to innovate at the level of the Business Model
Rethinking the fundamentals of how a business creates and captures value has become a priority, we are in a different era, the past one was of slow change and stable industries yet we still saw rapid convergence. The sheer acceleration and changes in technology, customer desires and the need to build ecosystems is making the Business Model far more important to focus on than product and service innovations.
The problem is we are still not clear how shifting business models is supposed to get done. Taking the trend “minimum viable product” populated by Eric Reis and his Lean Start-up methodology - it suggests by pulling together the essential elements of, in this case, new business models, into barely working prototype models, specifically designed to test key risks, you learn from ‘lightweight’ and readily adaptable versions of potentially new business models to take them forward or rethink your original hypothesis.
Both MVP and MVT are like prototypes but they are simply not passed around and tinkered with internally, they are immediately thrown at the market and subjected to trial by fire. In Eric Reis’s view it is all about identifying flaws and working to improve them as rapidly as possible.
This minimal approach must be specifically designed, not as a proof of concept but to test hypotheses and gain knowledge about the biggest unknowns that could sink any new offering.
Each change from minute operational change to global restructuring is better understood by iterative discovery but with full disclosure to customers, who surprisingly are very willing to join the journey of learning. This becomes a validated learning journey.
The whole approach to this minimum viable transformation is looking for understanding to reduce the risks of large-scale change. The core principles of MVP - validate learning, rapid prototyping, frugal creativity along with thinking MVT for reducing risks, increasing understanding of scale and speed makes for a potentially appealing approach to working on new Business Models.
Why explore new Business Models at the edge?
Focusing on “scaling edges,” allows for identifying promising “edges” for the organization, then grow that edge until it becomes a viable new core or complementary line of business. Such an approach can make it possible for businesses to reinvent themselves while minimizing potential risks—and maximizing impact.
An edge is a growth opportunity that has the potential to scale—so much so that it can catalyse change, eventually becoming effective enough to replace the core of the business. A true edge should align with larger trends disrupting the industry. Edges involve fundamentally different business models and practices from those of the core.
Edges give the transformation team far more degrees of freedom to test and experiment with new approaches to evolving a fundamentally different business model.
We finish this with five guidelines for transformation on the edge
Today corporate transformations must be designed and executed quickly and routinely—not as once-a-decade events. Management teams are looking for best practices that increase speed and reduce the risk of pursuing business model innovation and change. That’s where minimum viable transformation comes into play. Before diving in, management teams should consider these five principles:
1. Learn how to learn. The central goal of minimum viable transformation is to learn from a true field experiment.
2. Pick up speed. There’s a reason this approach starts with the word “minimum”: The learning has to happen fast. As soon as a company executes the idea it’s pursuing, it shows its hand to competitors— who will quickly respond with their own strategies.
3. Embrace constraints. Much has been written about the counter-intuitive effect of constraints—they don’t foil creativity, but fuel it. It’s worth noting that the very constraints we’ve been talking about here—few bells and whistles and scarce time—take real creativity to address. At the very least, they compel a focus on the goal—the need to learn and reduce risk around the key objective.
4. Have a hypothesis. To succeed, transformation initiatives must clearly articulate both the need for change and its direction. Such a statement of direction helps identify key assumptions driving the change effort (assumptions that will need to be tested and refined along the way). Leaders will also need to develop metrics that measure short-term progress.
5. Start at the edge. Find an “edge” of the current business—a promising arena that can showcase the potential of a fundamentally different, highly scalable business model that could even become a new core. Starting at the edge gives the transformation team far more freedom to test and experiment, and more ability to learn and react quickly.
In short, these five key principles can help bypass traditional barriers to transformation, ultimately supporting more effective response to mounting performance pressures.
Both of these articles come from a significant report, the full report is "Business ecosystems come of age". The notion of business ecosystems is now a crucial focal point for innovation, analysis, and strategic planning. Businesses are moving beyond traditional industry silos and coalescing into richly networked ecosystems, creating new opportunities for innovation alongside new challenges for many incumbent enterprises.
The world is entering an era in which ideas and insights come from everywhere, and crowds, clouds, collaborators, competitions, and co-creators can fundamentally help define our shared future. The business environment is being permanently altered as a result.
We require the thinking of thought leaders to emphasize and point us to ideas that we can adopt, experiment with and learn to our own benefit. For this learning, you need the time to read, explore and experiment.
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