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-page limit: overall 4 pages, double spaced (approximately 1 page per question)How would you “pretotype” a dual-screen (i.e., 2 screens) iPad?Please draft an organizational apology from the perspective of the San Jose mine, building on the articles “The organizational apology” and “How to lead during a crisis.”Building on the article on “Failing by design” how would you apply three of the principles highlighted in the article to “Apple” (time of the case study in “Apple Inc. in 2012”).Building on the article on “The Real Leadership lessons of Steve Jobs” how would you apply “products before profits”, “simplify”, and “Combine Humanities with Sciences” to a start-up of your choice (you can choose an existing or an imaginary start-up here.)
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Business and Organizational
Leadership
Session 5
International Leadership
San Diego, CA
AGENDA
§ PESTEL Analysis
§ Cultural Dimensions (Hofstede)
§ Making It Overseas
§ Leading Cultural Adaptations
§ International Feedback
2
1
PESTEL Analysis
PESTEL Analysis – Step 1
Political Factors
Economic Factors
Social Factors
Technological Factors
Ecological Factors
Legal Factors
Sources: adapted from Gamble, J.E. et al., 2015. Ess entials of Strategic Management. McGraw Hill. New York, NY.
PESTEL Analysis
PESTEL Analysis – Step 2 (Risk Assessment)
Political Factors
Economic Factors
1
1
10
Social Factors
1
1
10
Technological Factors
1
1
10
Ecological Factors
1
1
1
1
10
1
1
10
Legal Factors
10
Sources: adapted from Gamble, J.E. et al., 2015. Ess entials of Strategic Management. McGraw Hill. New York, NY.
2
AGENDA
§ PESTEL
§ Cultural Dimensions (Hofstede)
§ Making It Overseas
§ Leading Cultural Adaptations
§ International Feedback
5
Cross – Cultural Dimensions (Geert Hofstede)
Sample Cultural Dimensions
Uncertainty Avoidance (UAI)
Low Uncertainty Avoidance
High Uncertainty Avoidance
Power Distance Index (PDI)
High Power Distance
Small Power Distance
Long Term Orientation (LTO)
Short Term Orientation
Long Term Orientation
Individualism (IDV)
Collectivism
Sources: adapted from Hofstede, G. 2001. Culture’s Consequences. Second Edition. Thousand Oaks, Sage Publications.
Individualism
6
3
Cross – Cultural Dimensions (Geert Hofstede)
Sample Cultural Dimensions
Uncertainty Avoidance (UAI)
65 (Germany)
Low Uncertainty Avoidance
High Uncertainty Avoidance
Power Distance Index (PDI)
35 (Germany)
High Power Distance
Small Power Distance
Long Term Orientation (LTO)
83 (Germany)
Short Term Orientation (past)
Long Term Orientation (future)
Individualism (IDV)
67 (Germany)
Individualism
Collectivism
Sources: adapted from Hofstede, G. 2001. Culture’s Consequences. Second Edition. Thousand Oaks, Sage Publications.
7
Cross – Cultural Dimensions (Geert Hofstede)
Group exercise
Sample Cultural Dimensions
Uncertainty Avoidance (UAI)
Low Uncertainty Avoidance
High Uncertainty Avoidance
Power Distance Index (PDI)
High Power Distance
Small Power Distance
Long Term Orientation (LTO)
Short Term Orientation (past)
Long Term Orientation (future)
Individualism (IDV)
Collectivism
Sources: adapted from Hofstede, G. 2001. Culture’s Consequences. Second Edition. Thousand Oaks, Sage Publications.
Individualism
8
4
Cross – Cultural Dimensions (Geert Hofstede)
Further Cultural Dimensions (Geert Hofstede)
Masculinity (MAS)
Masculinity
Femininity
“…refer to the dominant gender role patterns in the vast majority of both traditional and modern societies…” (p. 284)
“…social goals such as relationships, helping others, and the physical environment…” and “…goals such as careers and money…” (p. 279)
Indulgence (IND)
Restained
Indulgence
Potential proxy of indulgence and happiness (society that controls/restrains gratification needs versus a society that does not)
Sources: adapted from Hofstede, G. 2001. Culture’s Consequences. Second Edition. Thousand Oaks, Sage Publications.
9
AGENDA
§ PESTEL
§ Cultural Dimensions (Hofstede)
§ Making It Overseas
§ Leading Cultural Adaptations
§ International Feedback
10
5
Article: Making It Overseas.
Global Mindset
Analysis
To what extent do you:
Rating
(1 no – 5 yes, highly)
Social
Psychological
Capital
Intellectual Capital
(Capacity for Building
Capital
(General Knowledge and (Capacity for Change)
Trusting Relationships
Capacity to Learn)
With Different People)
Know about business strategies for expanding globally
Know about the geography, history, and important
business and cultural leaders of several countries
Know about the major religions of the world and their
influence on society
Discuss the economic and political ramifications of world
events with friends and colleagues
Enjoy exploring different parts of the world.
Want to learn about other cultures and their customs.
Challenge yourself in new and different ways
Feel comfortable even though you are not in control of a
situation.
Work effectively with people who are very different from
you.
Willingly coordinate your activities with others.
Have the ability to engage people of different cultures to
work together to achieve an objective.
Understand the nonverbal expressions of people of several
cultures.
Sources: adapted from Javidan, M. et al. (2010). Making It Overseas. Harvard Business Review.
11
Article: Making It Overseas.
Building Capital
Difficulty Level
More Information about the culture, Appreciation between
similarities between different cultures
Easy
Conferences, roundtables
Publications with strong global coverage, websites,
international television programs
Workshops and Lectures
Self reflection
Difficult
Exposing to new social circles
International movies, restaurants, museums
Feel comfortable even though you are not in control of a
situation.
Experience-based, network-based
Include people in your circle of interaction with people that
diverge from yours
Travel abroad assignments
Increase international exposure at home (hosting international
meetings, cooking classes)
Sources: adapted from Javidan, M. et al. (2010). Making It Overseas. Harvard Business Review.
Medium
Social
Psychological
Capital
Intellectual Capital
(Capacity for Building
Capital
(General Knowledge and (Capacity for Change)
Trusting Relationships
Capacity to Learn)
With Different People)
How to Build and Develop Capital:
12
6
AGENDA
§ PESTEL
§ Cultural Dimensions (Hofstede)
§ Making It Overseas
§ Case Study: Leading Cultural Adaptations
§ International Feedback
13
Eurodisney
1
4
7
Challenges Prioritizations for Leaders
Task
Challenges:
Level of Urgency
Level of Importance
•…
1
10
1
10
•…
1
10
1
10
•…
1
10
1
10
•…
1
10
1
10
•…
1
10
1
10
•…
1
10
1
10
Prioritized Areas:
•…
15
Cross – Cultural Dimensions (Geert Hofstede)
Sample Cultural Dimensions
Uncertainty Avoidance (UAI)
Low Uncertainty Avoidance
High Uncertainty Avoidance
Power Distance Index (PDI)
High Power Distance
Small Power Distance
Long Term Orientation (LTO)
Short Term Orientation (past)
Long Term Orientation (future)
Individualism (IDV)
Collectivism
Sources: adapted from Hofstede, G. 2001. Culture’s Consequences. Second Edition. Thousand Oaks, Sage Publications.
Individualism
16
8
Volatility Demand study
Volatility Demand Study
High
neutral
Low
Q1
Q2
Q3
Q4
1
7
Implication for Other Dimensions
Implications
Internal Hierarchies
High Power Distance
Small Power Distance
Food Offerings
Low
High
Beverage Offerings
High
Low
Rides and Events (In Line)
Low Uncertainty Avoidance
Sources: adapted from Hofstede, G. 2001. Culture’s Consequences. Second Edition. Thousand Oaks, Sage Publications.
High Uncertainty Avoidance
18
9
Segmentation
Customer Experience Strategy
Segment
needs and
drivers
Offering 1
Offering 2
Offering 3
Offering 4
Rides
Food
Beverages
Hotel and
Accommodation
Other
Entertainment
Segment 1
Segment 2
Segment 3
Segment 4
19
The five stages of grief (Kuebler-Ross Model, 1969).
High
Denial
Acceptance
Morale
Anger
Bargaining
Depression
Low
Time
Sources: Adapted from E. Kuebler-Ross (1969), On Death and Dying, Touchstone, New York, NY.
20
10
The five stages of grief (Kuebler-Ross, 1969) can be adapted to
change management.
High
Changes/
Integration
Denial
Acceptance
Morale
Anger
Bargaining
Testing/
Experimenting
Depression
Low
Time
21
Sources: Adapted from E. Kuebler-Ross (1969), On Death and Dying, Touchstone, New York, NY.
Change management includes new structures and capability
management.
High
Change
Denial
Acceptance
Morale
Anger
Bargaining
Experiment
Depression
Low
Time
Sources: Adapted from E. Kuebler-Ross (1969), On Death and Dying, Touchstone, New York, NY.
22
11
Leadership changes can be implemented along a matrix that captures
impact of an initiative and difficulty level of execution
Early (Quick) Wins
High
A
Impact
C
B
D
Low
High
Low
Difficulty Level
Criteria Development for Location Choices
Criteria (groups)
Final Score
Weight
Option 1
Option 2
Option 3
Berlin
Barcelona
Paris
…
…
…
Score: 1 low – 5 high
12
AGENDA
§ PESTEL
§ Cultural Dimensions (Hofstede)
§ Making It Overseas
§ Leading Cultural Adaptations
§ International Feedback
25
Feedback mechanisms for leadership
Increasing the Johari Window
Johari WIndow
Known by self
Unknown by self
Known by
others
Open/public area
Blind area
Unknown by
others
Hidden area
Unknown area
Sources: Adapted from Luft, J.; Ingham, H. (1955). “The Johari window, a graphic model of interpersonal awareness.”
Proceedings of the Western Training Laboratory in Group Development (Los Angeles: University of California, Los Angeles).
26
13
Giving and receiving feedback is important in project
settings and can be used as an important management tool.
Giving feedback
• Cultural differences in approaches
• Feedback as “giving a gift”
• In many areas positive beginning and
end
• Specific and Detailed
• Provide Examples
• Encouraging
• “De-individualize mistakes”
Receiving feedback
•
•
•
•
•
•
Listen
Feedback as “receiving a gift”
Clarify and provide some examples
Triangulate
Thanking
Try to incorporate examples
27
Management versus Leadership
Management versus Leadership (Kets de Vries, 2007; Kotter, J., 1995)
Management (COO Tim Cook)
Leadership (CEO Steve Jobs)
Concerned about Stability
Concerned about Change
Communication concerned with
Complexity
Communication concerned with
Simplicity
Focus on Present
Focus on Future
Tend to Control
Tend to Empower
Ask: HOW?
Ask: WHY?
Decision Making Based on
Analysis
Goals based on Immediate
Necessity
Position based on Authority
Decision Making Based on
Intuition (and Analysis)
Goals based on “Inner Theatre”
Position based on Charisma
Sources: e.g. Schaefer, U., and Burger, C. “Taking Charge”, Case Notes 2013. Kotter, J. (1995). Leading change: Why transformation efforts fail. Harvard
Business Review 03/04: 59-67; Kets de Vries, M. (2007). The leadership mystique: Leading behavior in the human enterprise. 2nd ed. London: Prentice28
Hall.
14
Business and Organizational
Leadership
Session 10
Leadership for Radical Innovation
San Diego, CA
AGENDA
§ Leadership for Radical Innovation
§ Organizational Models
§ Fuzzy Front End
§ Business Model Innovation
§ Reverse Innovation
2
1
Isaacson, Walter. 2012. Leadership Lessons of Steve Jobs
Leadership Lessons 1/2
• Focus
-Focus and prioritize
product
-2×2 matrix (consumer
and Pro x portable
and laptop)
-Top 100 people
discuss the 10 things
that need to be done
-”We can only do 3”
• Simplify
• End-to-End
-Simplicity is ultimate
-Apple ecosystem
sophistication
-end to end
Decentralize
-Example mouse with
responsibility for the
only one button for 15$d
user interface
-conquer the challenges
-software and hardware
-no on/off button on
integration
ipod
• When behind,
leapfrog
• Products
before profits
• De-emphasize
Focus Groups
-Example: iMacs CD
slot
-leapfrog to reconfigure
entire music industry
Iphone creation
-Make Macintosh
insanely great
-profits will follow
-prioritize that way
-consumers cannot
always put new
innovations in
perspective
-Ford: “A faster horse”
-se-emphasize focus
groups
-use intuition
• Bend Reality
-named after “Star
Trek” episode
-could encourage
people to do the
impossible
-example Woz creating
the game “Breakout”
-Gorilla glass
-”Don’t be afraid”
Source: Isaacson, W. 2012. Leadership Lessons of Steve Jobs. Harvard Business Review
3
Isaacson, Walter. 2012. Leadership Lessons of Steve Jobs
Leadership Lessons 2/2
• Impute
-people judge a book by
its cover
-iPhone box sets the
tone for experience with
the product
-handle on playful iMac
• Push for
Perfection
-break in projects
-example screen
centered iPhone rather
than aluminum
-example iPad edges
• Humanities
with Sciences
• Big Picture
and Details
-integrate humanity and
science (interface)
-arts to engineering
-integration of business
strategy
-great vision
-aspirational and
inspirational
-knowledge on details
• Face-to-Face
-creativity originates
from random meetings
-development of offices
(e.g., Pixar)
Less formal
presentations
Source: Isaacson, W. 2012. Leadership Lessons of Steve Jobs. Harvard Business Review
• A-Players
-impatient and honest
way of working with
people
-roughness in
combination with being
inspirational
• Stay Hungry,
Stay Foolish
-hippie and nonconformists style
“Think Different”
advertisings
4
2
AGENDA
§ Leading for Radical Innovation
§ Organizational Models
§ Fuzzy Front End
§ Business Model Innovation
§ Reverse Innovation
5
In general, we speak of six different organizational models:
customer centric…
Customer Centric Models
CEO
Segment A
(Corporate)
Segment B
(Medium Sized
Clients)
Segment C
(Private Clients)
Support
Functions
Finance
Customer
Segment A
Customer
Segment B
Adv.
• Customer needs
• Revenue growth
• Trend incorporation
• Faster innovation
along perc. customer
needs
Source: Company websites
Customer
Segment C
Accounting,…
Disadv.
• Product innovation
not necessarily in focus
and not transferred across
• High co-ordination cost
• Internationalization
6
3
A further type includes product centricity…
Product Centric Models
CEO
Product
Group A
Product
Group B
Product
Product C
Sales/
Marketing
Sales/
Marketing
Sales/
Marketing
Operations
Operations
Operations
R&D,…
R&D,…
R&D,…
Product
Segment A
Product
Segment B
Product
Segment C
Adv.
Disadv.
• Innovation focus
• Product trends
incorporated
• Easy to budget
• Bundles difficult to manage and allocate
• Customers out of focus
Source: Company websites
7
A further type includes a functional structure…
Functional Structure
CEO
Sales
Finance and
Accounting
Operations
Sales
Taxation
Logistics
Recruiting
Marketing
Finance
Supply Chain
Training
Digital
Accounting
Purchasing
Retention
POSTMASTER GENERAL
AND
CHIEF EXECUTIVE OFFICER
HR
Consumer and
Industry Affairs
VP
James Nemec
Chief
Operating
Officer
and Exec. VP
David Williams
Delivery
Operations VP
Edward Phelan, Jr
Facilities VP
Tom Samra
Network
Operations VP
Linda Malone
Retail & Customer
Service Operations
VP
Kelly Sigmon
Adv.
Disadv.
Capital Metro
AVP
Kristin Seaver
Eastern AVP
Joshua Colin
• Clear roles/responsibilities
• Transfer of practices
• Synergies across
products
Source: Company websites
Megan Brennan
Deputy
Postmaster
General & Chief
Government
Relations Officer
Ronald Stroman
Great Lakes
AVP
Jacqueline
Krage Strako
• Little customer focus
• Little R&D focus
Chief
Information
Officer and
Exec. VP
A/Randy Miskanic
Chief Information
Security Officer
and Digital
Solutions VP
Vacant
Engineering
Systems VP
Michael Amato
Enterprise
Analytics VP
Robert Cintron
Judicial
Officer
William Campbell
Chief
Financial
Officer and
Exec. VP
Joseph Corbett
Chief Human
Resources
Officer and
Exec. VP
Jeffrey Williamson
Chief
Marketing and
Sales Officer,
Exec. VP
A/Jim Cochrane
Controller VP Employee Resource
Maura McNerney Management VP
A/John Godlewski, Jr.
Global Business
VP
Giselle Valera
Finance and
Planning VP
Shaun Mossman
New Products
and Innovation
VP
Gary Reblin
Labor
Relations VP
Douglas Tulino
Supply
Management
VP
Susan Brownell
General
Counsel
and Exec.
VP
Chief
Postal
Inspector
Guy Cottrell
Corporate
Communications
VP
A/Elizabeth Johnson
Thomas Marshall
Pricing VP
Cynthia
Sanchez-Hernandez
Sales VP
Cliff Rucker
Information
Technology VP
John Edgar
Mail Entry
and Payment
Technology VP
Pritha Mehra
Northeast
AVP
Richard Uluski
Pacific AVP
Dean Granholm
Southern AVP
Jo Ann Feindt
Official
Organizational Chart
Western AVP
Drew Aliperto
Shading = Executive Leadership Team (8 Members)
USPS
05/05/2015
8
4
A further type includes a regional structure…
Regional Structure
CEO
Region 1
Region 2
Region 3
Region 4
Sales
Sales
Sales
Sales
Operations
Operations
Operations
Operations
Finance/Acc
Finance/Acc
Finance/Acc
Finance/Acc
Region
Region
Region
Region
Adv.
Disadv.
• Synergy exploiTation In regions
• Marketing/ Sales
Approaches tailored to
Region
• Little R&D focus
• Few synergies across
regions
Source: Company websites
9
A further type includes a cross-functional council structure…
Council (Opportunity) Structure
CEO and
Operating
Committee
Council
Council
6 bn$
Council
Council
2 bn$
1 bn$
Adv.
• Agility
• Opportunity Driven
• Synergy
• Marketing/ Sales
Approaches
Source: Company websites
Disadv.
• More difficult to manage
• Highly complex
10
5
A sixth (less often used) structure is a matrix structure, which is
often utilized in service companies.
Matrix Structure
Industry 1 Industry 2 Industry 3 Industry 4 Industry 5 Industry 6 Industry 7
•
Strategy
•
Performance
•
Private Equity
•
Digital /
•
Organization
•
Mergers and
Advanced Analytics
Acquisitions
•
Transformation
Source: Company websites
11
Potential Organizational Structure
Structure
Key components
-CEO
-CFO
-COO
-Accounting
-Innovation/Development
-Emerging Markets
-Europe
-Americas
-Supply Chain Management
-Sales
-Direct Sales
-Marketing
-Branding
-Product Group 1
-Product Group 2
-Product Group 3
-Services
13
6
AGENDA
§ Leading for Radical Innovation
§ Organizational Models
§ Fuzzy Front End
§ Business Model Innovation
§ Reverse Innovation
14
Strategic Innovation
Fuzzy Front End
Developing a Fuzzy Front End
Opportunity
Identification
Opportunity
Synthesis
Fuzzy Front End
Idea generation
Early prototyping and concept
development
Early Prototyping/ Concept
Sources: Adapted from Koen, P. A. (2004). The fuzzy front end for incremental, platform, and breakthrough products. The PDMA Handbook of New Product Development,
Second Edition, 81-91.
15
7
Opportunities identification is critical and there are different
approaches as to learn from non-consumers and heavy users
Opportunity Identification
Understanding Non-Consumers
o Understanding consumers on the
verge of buying
o Key barriers
o Key essentials
Innovation from
the Tails
Illustrative
Understanding Heavy Users
o Find heavy “extreme“ users (24/7
users)
o Product-Service mix, understand pattern
o Follow early adopters
Understanding Use Scenarios
Increasing Signal Strengths
o Follow and understand use patterns
o Follow need patterns
o Follow points of frustrations (seniors)
o Being sensitive to small signals
o Identify and amplify signals
o Prioritize signals and patterns
In-Depths Analysis
Clustering of Non-Consumers
Mix of qualitative and ethnography
Several days/weeks of ethnography
Follow needs and overall group behavior
Cross industry analysis
o Clsutering of non-consumers into
categories (by segments, value, use)
o Prioritize segments
o
o
o
o
o Examples: customer experience, call
customer service, former customers
o Examples: Repair shops, power users,
unexpected experts, senior users
Sources: Kelley, T., Kelley, Dave. (2013 ). Creative Confidence. Unleashing the Creative Potential Within Us All. Crown Business Press.
Opportunities synthesis is a key intellectual activity in the
innovation process
Opportunity synthesis and analysis
Understanding Non-Consumers
o Understanding consumers on the
verge of buying
o Key barriers
o Key essentials
Changing Questions
o „Perceived“ customer needs
o Adjusting and clarifying questions for
customer needs
Finding Focus Points
Innovation from
the Tails
Finding more abstract truth
o Detaching from individual examples
Illustrative o Finding patterns
o Categorizing
Finding Overarching Themes
o By customer need
o Bycategorization of risk
o By points of frustrations
Solution Matrix or “Empathy
Map”
o Clutering of consumer needs
o Prioritizing key themes
o Solution matrix
o Prioritization
o Empathy map according to customer
needs
o Examples: Key focus points
o Examples: solution matrices, maps,
categorizations
Sources: Kelley, T., Kelley, Dave. (2013 ). Creative Confidence. Unleashing the Creative Potential Within Us All. Crown Business Press.
8
Innovation Management
Innovation Tournaments : Idea Generation: Example Phone
Idea Pitch Stage
Pitch 0
Planning Pitch
Stage
Pitch 1
Market Testing
Pitch
Pitch 2
Market
1
8
1. Visualization
Non-Verbal Communication is Key
Adv.
• Visual Thinking
• Engaging multiple
creative areas in brain
• Cross functional
collaboration
Adv.
• Risk reduction
• Unmatched mental
models reduction
• Simple drawings
Source: adapted from Liedtka, J. 2010. Ten Tools for Design Thinking. Darden.
19
9
1. Visualization
Non-Verbal Communication is key
• Pain Point 1
• Pain Point 2
• Pain Point 3
Decentralize
d
• Design Solution Idea 1
Source: adapted from Liedtka, J. 2010. Ten Tools for Design Thinking. Darden.
20
2. Persona Development
Personas help to relate
Adv.
• Customers does not
want a product, they
wants a solutions
• New offering
identifications
GOALS:
FRUSTRATIONS:
MOTIVATIONS:
Adv.
• Behavior is sticky so
ideally no big changes in
customer behavior
• Habit understanding
Source: adapted from Liedtka, J. 2010. Ten Tools for Design Thinking. Darden.
WORK-AROUNDS:
21
10
2. Persona Development…finding major dimensions
Dimension 2 (e.g., Low Income vs. high income)
Dimension 1 (e.g., Business vs Consumer)
Source: adapted from Liedtka, J. 2010. Ten Tools for Design Thinking
22
2. Persona Template
Short Description:
Prioritize
3 Goals:
Preferred Channel 1:
3 Frustrations:
Prioritize
Preferred 2 Channels:
Personality:
Preferred Channel 2:
Prioritize
3 Motivations:
Source: adapted from Liedtka, J. 2010. Ten Tools for Design Thinking
24
11
3. Journey Mapping
Journey Mapping for top persona
Phases
Sub-Phases
Aims/Goals
Frustrations
End
Beginning
Source: adapted from Liedtka, J. 2010. Ten Tools for Design Thinking
25
4. Value Chain Analysis
Value Chain Reconfigurations
Original InHouse
Value Chain
Supply
Value Chain
InHouse
Value Chain
Value Step 1
Value Step 2
Value Step 3
Value Step 4
Value Step 5
Activities
Activities
Activities
Activities
Activities
Activities
Activities
Activities
Activities
Activities
Activities
Activities
Activities
Activities
Activities
Activities
Activities
Activities
Customer
Value Chain
Activities
Activities
Source: adapted from Liedtka, J. 2010. Ten Tools for Design Thinking
26
12
4. Value Chain Analysis
Value Chain Reconfigurations
Original InHouse
Value Chain
Value Step 1
Value Step 2
Value Step 3
Value Step 4
Value Step 5
Activities
Activities
Activities
Activities
Activities
Activities
Activities
Activities
Activities
Activities
Core Capability
Core Capability
Your Proposed
Value Chain
Value Step 1
Value Step 5
Virtual 2-4 (supplier/Buyer
27
4. Value Chain Analysis
Value Chain Reconfigurations
Original InHouse
Value Chain
Value Step 1
Value Step 2
Value Step 3
Value Step 4
Value Step 5
Activities
Activities
Activities
Activities
Activities
Activities
Activities
Activities
Activities
Activities
Key
Competitor 1
Key
Competitor 2
Your Proposed
Value Chain
28
13
4. Value Chain Analysis
Value Chain Reconfigurations
Original InHouse
Value Chain
Value Step 1
Value Step 2
Value Step 3
Value Step 4
Value Step 5
Activities
Activities
Activities
Activities
Activities
Activities
Activities
Activities
Activities
Activities
Core Capability
Core Capability
Your Proposed
Value Chain
29
4. Value Chain Analysis
Value Chain Reconfigurations
Original InHouse
Value Chain
Value Step 1
Value Step 2
Value Step 3
Value Step 4
Value Step 5
Activities
Activities
Activities
Activities
Activities
Activities
Activities
Activities
Activities
Activities
Key
Competitor 1
Key
Competitor 2
Your Proposed
Value Chain
30
14
4. Value Chain Restructurings and Reconfigurations Example
Value Chain Reconfigurations – Relay-Rides
Original InHouse
Value Chain
Supply
Value Chain
Value Step 1
Value Step 2
Value Step 3
Value Step 4
Value Step 5
Activities
Activities
Activities
Activities
Activities
Activities
Activities
Activities
Activities
Activities
Technological Back-End
Payment Systems
Cloud Infrastructure
Tracking
Location Systems
Payment Collection
Business Model
Adjusted Pricing
InHouse
Value Chain
Customer Database
Pricing Models
Data Base, Segments
Business Model
Development
Rating, Referrals
Customer Hardware
Customer
Value Chain
Computers, CellPhones
Data Plans, Software
31
How could the reconfigured value chain for a Value Chain
Restructurings and Reconfigurations look like – Example
Value Chain Reconfigurations – Shared General Services
Original InHouse
Value Chain
Value Step 1
Value Step 2
Value Step 3
Value Step 4
Value Step 5
Activities
Activities
Activities
Activities
Activities
Activities
Activities
Activities
Activities
Activities
Supply
Value Chain
InHouse
Value Chain
Customer
Value Chain
32
15
5. Mind Mapping / Clustering
Mind Mapping
Adv.
Need Cluster 1
• Used for synthesis
• Used for clustering
Need Cluster 2
Adv.
Need Cluster 3
• Fast ways to prioritize
• Fast ways to learn from
data
Source: adapted from Liedtka, J. 2010. Ten Tools for Design Thinking. Darden.
33
6. Assumption Testing
General Assumption Testing
•Honest assumption testing is essential
•General assumption testing first and then specific assumption testing
• 1. Value Test:
• 2 Execution
Test:
• 3. Scale Test:
• 4. Defense
Test:
• Is customer
willing to pay?
• Can you create
it?
• Can you scale
it?
• Can you
defend it?
Source: Isaacson, W. 2012. Leadership Lessons of Steve Jobs. Harvard Business Review
34
16
6. Assumption Testing
Specific Assumption Testing
•Honest assumption testing is essential
•Define the 3 major assumptions that need to be tested
• Assumption 1
• Assumption 2
• Assumption 3
Source: Isaacson, W. 2012. Leadership Lessons of Steve Jobs. Harvard Business Review
35
6. Assumption Testing
Specific Assumption Testing (start with highest priority assumption)
• Assumption 1
• Assumption 2
• Assumption 3
• Fast Test
• Fast Test
• Fast Test
Source: adapted from Liedtka, J. 2010. Ten Tools for Design Thinking. Darden.
36
17
7. Solution Story Board
Solution Story Board
• Persona 1
• Struggle
• Crisis
• Climax/Solution
Source: adapted from Liedtka, J. 2010. Ten Tools for Design Thinking. Darden.
38
7. Solution Story Board
Solution Story Board
• Persona 2
• Struggle
• Crisis
• Climax/Solution
Source: adapted from Liedtka, J. 2010. Ten Tools for Design Thinking. Darden.
39
18
8. Designing Learning Launches
Local
• Super Local 2
Roll Out Intensity
Decentralized
• “Learning
• Super Local
1 Safe
Location
1
2
Product Features
Source: adapted from Liedtka, J. 2010. Ten Tools for Design Thinking. Darden.
40
8. Designing Learning Launches
• Super Local
• Key Feature Testing
• Venue
Decentralized
• Day/Weekend
• Friend/Family Involvement
Source: adapted from Liedtka, J. 2010. Ten Tools for Design Thinking. Darden.
41
19
AGENDA
§ Leading for Radical Innovation
§ Organizational Models
§ Fuzzy Front End
§ Business Model Innovation
§ Reverse Innovation
42
Four Types of Business Model Innovation
Mechanisms
Diapers.com
Customer
-Focus
-Product and
Service Synergies
-Hedging
Examples
FOCUS
TIMING
DECISION MAKER
REASONING
-Decision timing
(often postponing)
-Order Decision
-Split decision
-Informed person
-Decision risk
transfer
-Decision maker
with stakes
-Revenue stream
adaptations
-Customer model
adaptation
-Incentives
Wal Mart
(Decision
Transfer)
LiveOps
(freelancing call
center)
Dollars-shaveclub
Business Model Innovation
Sources: Adapted from Girotra, K. and Netessine, S. (2014). Four Paths To Business Model Innovation. Harvard Business Review
43
20
Business Model Canvas
KEY
PARTNERS
KEY
ACTIVITIES
VALUE
PROPOSITIONS
CUSTOMER
RELATIONSHIPS
KEY
RESOURCES
COST STRUCTURE
CUSTOMER
SEGMENTS
CHANNELS
REVENUE STREAMS
Sources: Osterwalder, A. (2004). The Business Model Ontology
– A Proposition In A Design Science Approach. Company Websites.
Business Model Development: Step 1
Revenue and Assets
Customer
1. Revenue model?
1. Customer Description?
1. Any recurring revenues?
1. Customer Acquisition?
2. Assets available to you?
2. Customer Retention?
Cost Structure
Partners and Model
1. Fixed cost?
1. Key partners?
1. Variable costs?
1. Key activities for value creation?
2. Lean cost options?
2. How can the model be made scale-able?
Sources: Osterwalder, A. (2004). The Business Model Ontology
– A Proposition In A Design Science Approach. Company Websites.
21
Business Model Development: Step 2
KEY
PARTNERS
Please list and
describe your key
partners here:
KEY
ACTIVITIES
Please list and
describe the key
activities:
VALUE
PROPOSITIONS
Please clarify your
value proposition
here:
CUSTOMER
RELATIONSHIPS
Please clarify your
plans for customer
acquisition here:
CUSTOMER
SEGMENTS
Please describe and
analyze your
customer segments
here:
Please clarify your
plans for customer
retention here:
KEY
RESOURCES
Please describe and
analyze your resources
here:
COST STRUCTURE
CHANNELS
Please describe and
analyze your channels
here:
REVENUE STREAMS
Fixed costs:
Initial revenues:
Variable cost
Recurring revenues
Sources: Osterwalder, A. (2004). The Business Model Ontology
– A Proposition In A Design Science Approach. Company Websites.
Value Proposition Design: Step 1
Customer Gains:
-Customer Benefits
-Precise Outcomes
-Detailed Positive Impact
Customer Jobs:
-Customer Job
Description
-Perceived processes
Customer Pains:
-Customer Risks
-Negative Outcomes
-Detailed Obstacles
Sources: Osterwalder, A. et al. (2014). Value Proposition Design. Wiley.
22
Value Proposition Design: Step 2
Gain Creation:
-How do Products develop
customer Gains
-How do Services develop
customer gains
Products & Services
-List of Products
-List of Services
-Surrounding (combined)
Value Propositions
Pain Relieve:
-How do Products ease
customer pains
-How do Services ease
customer oains
Sources: Osterwalder, A. et al. (2014). Value Proposition Design. Wiley.
Value Proposition Design: Step 3
Customer Gains:
-Customer Benefits
-Precise Outcomes
-Detailed Positive Impact
Gain Creation:
-How do Products develop
customer Gains
-How do Services develop
customer gains
Customer Jobs:
-Customer Job
Description
-Perceived processes
FIT
Products & Services
-List of Products
-List of Services
-Surrounding (combined)
Value Propositions
Pain Relieve:
-How do Products ease
customer pains
-How do Services ease
customer oains
Customer Pains:
-Customer Risks
-Negative Outcomes
-Detailed Obstacles
Sources: Osterwalder, A. et al. (2014). Value Proposition Design. Wiley.
23
Value Proposition Design: Step 4
Customer Gains:
Gain Creation:
FIT
Products & Services
Customer Jobs:
Customer Pains:
Pain Relieve:
Not Addressed
Addressed
Sources: Osterwalder, A. et al. (2014). Value Proposition Design. Wiley.
Value Proposition Design: Step 5
Customer Gains:
Gain Creation:
FIT
Products & Services
Customer Jobs:
Customer Pains:
Pain Relieve:
10
Not Addressed
Addressed
Prioritized
1
Sources: Osterwalder, A. et al. (2014). Value Proposition Design. Wiley.
24
AGILE Value Propositions : Option 1 Service Modelling (From
Product to Service)
Advantage
-Developing Subscription Models
-Understanding the value of recurring
revenues
-Building asset-light structures on
Customer Site
Service Modelling:
-selling a product as a
service
Examples
-GE
-HILTI
Sources: adapted from Osterwalder, A. et al. (2014). Value Proposition Design. Wiley.
AGILE Value Propositions : Option 2 Ultra Low Costing (Finding
the Bare-Bone Business Model)
Advantage
-targeting an underserved market/area
-finding novel customer segments in
the value area
-buiding competitive advantage on the
low cost segments
Ultra Low Costing
-untangeling core value
Examples
-Ryanair
-Dirt CheapCar Rental
Sources: adapted from Osterwalder, A. et al. (2014). Value Proposition Design. Wiley.
25
AGILE Value Propositions : Option 3 Product Up-featuring
(Finding the High Performance Features)
Advantage
-New underserved customer groups
-high value segmentations
-high margins
-high customer loyalty
Upfeaturing:
-targeting pain points at customers
Examples
-OXO
-Dyson
Sources: adapted from Osterwalder, A. et al. (2014). Value Proposition Design. Wiley.
AGILE Value Propositions : Option 4 Fashionization (Mixing
Innovative Product with Fashion)
Trendsetting:
-branding
-positioning
Advantage
-highly profitable segment
-mixing of innovation and fashion
models
Innovative Product:
-core innovation
Examples
-Swatch
-Apple Watch
Sources: adapted from Osterwalder, A. et al. (2014). Value Proposition Design. Wiley.
26
AGILE Value Propositions : Option 5 Platforming (Building up
Platform Models)
Advantage
-utilizing network effects
-winner takes all models
-highly sustainable once established
Platform Product:
-one-sided platform
-two-sided platform
Examples
-Events.com (events)
-turo.com (cars)
Sources: adapted from Osterwalder, A. et al. (2014). Value Proposition Design. Wiley.
AGENDA
§ Leading for Radical Innovation
§ Organizational Models
§ Fuzzy Front End
§ Business Model Innovation
§ Reverse Innovation
60
27
Reverse Innovation
Reverse Innovation
Illustrative
Traditional Innovation Project Approach
Innovation Origin
Adaptation and Distribution
Sources: Adapted from Govindarajan, V., Trimble, C. (2012) Reverse Innovation: Create Far From Home, Win Everywhere. Harvar
