Embrace Uncertainty

Hot Air Balloon Fest Uniontown, NJThere’s a lot of stress in the working world these days, and to me, it all comes down to our blatant disrespect of uncertainty.

In today’s reality, we ask for plans then demand strict adherence to the deliverables – on time, on budget, or else. We treat plans like they’re chiseled in granite, when really it should be more like dry erase markers and a whiteboard. Our markets are uncertain; customers’ behaviors are uncertain; competitors’ actions are uncertain; supply chains are uncertain, yet our plans are plans don’t reflect that reality. And when we expect absolute predictability and accountability, we create stress and anxiety and our people don’t want to try new things because that adds another level of uncertainty.

With a flexible, rubbery plan the first step informs the second, and this is the basis for the logical shift from robust plans to resilient ones. Plans should be less about forcing adherence and more about recognizing deviation. Today’s plans demand early recognition of something that did follow the plan and today’s teams must have the authority to respond quickly. However, after years of denying the powerful force of uncertainty and shooting the messenger, we’ve trained our people to hide the deviations. And, with our culture of control and accountability, our teams require our approval before any type of change, so their response time is, well, not timely.

At our core, we know uncertainty is a founding principle in our universe, and now it’s time to behave that way. It’s time to look inside and decide to embrace uncertainty. Accept it or not, acknowledge it or not, uncertainty is here to stay. Here are some words to guide your journey:

  • Resilient not robust.
  • Early detection, fast response.
  • Many small plans, done in parallel.
  • Do more of what works, and less of what doesn’t.
  • Plans are meant to be re-planned.

And if you’re into innovation, this applies doubly.

 

Image credit – dfbphotos.

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Inspiration, Imagination, and Innovation – in that order.

InspiredInspiration is the fuel for imagination and imagination is the power behind innovation.

All companies want innovation and try lots of stuff to increase its supply. But innovation isn’t a thing in itself and not something to be conjured from air – it’ a result of something. The backplane of innovation, its forcing function, is imagination.

But imagination is no longer a sanctioned activity. Since it’s not a value-added activity; and our financial accounting system has no column for it; and it’s unpredictable, it has been leaned out of our work. (Actually, she’s dead – Imagination’s Obituary.) We squelch imagination yet demand more innovation. That’s like trying to make ice cream without the milk.

No inspiration, no imagination – that’s a rule. Again, like innovation, imagination isn’t a thing in itself, it’s a result of something. If you’re not inspired you don’t have enough mojo to imagine what could be. I’ve seen many campaigns to increase innovation, but none to bolster imagination, and fewer to foster inspiration. (To be clear, motivation is not a substitute for inspiration – there are plenty of highly motivated, uninspired folks out there.)

If you want more innovation, it’s time to figure out how to make it cool to openly demonstrate imagination. (Here’s a hint – dust off your own imagination and use it. Others will see your public display and start to see it as sanctioned behavior.) And if you want more imagination, it’s time demonstrate random acts of inspiration.

Inspiration feeds imagination and imagination breeds innovation. And the sequence matters.

 

Image credit – AndYaDontStop

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How to Make Big Data Far More Powerful

The Seeing EyeBig Data is powerful – measure what people do on the web, summarize the patterns, and use the information for good. These data sets are so powerful because they’re bigger than big; there’s little bias since the data collection is automatic; and the analysis is automated. There’s huge potential in the knowledge of what people click, what pages they land on, and what place the jump from.

It’s magical to think about what can be accomplished with the landing pages and click-through rates for any demographic you choose. Here are some examples:

  • This is the type of content our demographic of value (DOV) lands on, and if we create more content like this we’ll get more from them to land where we want.
  • These are the pages our DOV jump from, and if we advertise there more of our DOV will see our products.
  • This is the geographic location of our DOV when they land on our website, and if we build out our sales capacity in these locations we’ll sell more.
  • This is the time slot when our DOV is most active on their smart phones, and if we tweet more during that time we’ll reach more of them.

But just as there’s immense power knowing the actions of your DOV (what they click on), there are huge assumptions on what it all means. Here are two big ones:

  1. All clicks are created equal.
  2. When more see our content, more will do what we want.

Here is an example of three members (A, B, C) of your demographic of interest who take the same measurable action but with different meaning behind it:

Member A, after four drinks, speeds home recklessly; loses control of the car; crashes into your house; and parks the car in your living room.

Member B, after grocery shopping, drives home at the speed limit; the front wheel falls off due to a mechanical problem; loses control of the car; crashes into your house; and parks the car in your living room.

Member C, after volunteering at a well-respected non-profit agency, drives home in a torrential rain 15 miles per hour below the speed limit; a child on a bicycle bolts into the lane without warning and C swerves to miss the child; loses control of the car; crashes into your house; and parks the car in your living room.

All three did the same thing – crashed into your house – but the intent, the why, is different. Same click, but not equal. And when you put your content in front of them, regardless of what you want them to do, A, B, and C will respond differently. Same DOV, but different intentions behind their actions.

Big Data, with its focus on the whats, is powerful, but can be made stereoscopic with the addition of a second lens that can see the whys. Problem is, the whys aren’t captured in a clean, binary way – not transactional but conversational – and are subject to interpretation biases where the integers of the whats are not.

With people, action is preceded by intent, and intent is set by thoughts, feelings, history, and context. And the best way to understand all that is through their stories. If you collect and analyze customer stories you’ll better understand their predispositions and can better hypothesize and test how they’ll respond.

In the Big Data sense, Nirvana for stories is a huge sample size collected quickly with little effort, analysis without biases, and direct access to the stories themselves.

New data streams are needed to collect the whys in a low overhead way, and new methods are needed to analyze them quickly and without biases. And a new perspective is needed to see not only the amazing power of Big Data (the whats), but the immense potential of seeing the what’s with one eye and the whys with the other.

Keep counting the whats with traditional Big Data work – there’s real value there. But also keep one eye on the horizon for new ways to collect and analyze the whys (customer stories) in a Big Data way.

Collection and analysis of customer stories, if the sample size is big enough and biases small enough, is the best way I know to look through the fog and understand emerging customer needs and emerging markets.

If you can figure out how to do it, it will definitely be worth the effort.

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Difficult Discussions Are The Most Important Discussions

Steam Engine CollisionWhen the train is getting ready to pull out of the station, and you know in your heart the destination isn’t right, what do you do? If you still had time to talk to the conductor, would you? What would you say? If your railroad is so proud of getting to the destination on time it cannot not muster the courage to second guess the well-worn time table, is all hope lost?

The trouble with thinking the destination isn’t right is that it’s an opinion. Your opinion may be backed by years of experience, good intuition, and a kind heart, but it’s still an opinion. And the rule with opinions – if there’s one, there are others. And as such, there’s never consensus on the next destination.

But even as the coal is being shoveled into the firebox and the boiler pressure is almost there, there’s still time to take action. If the train hasn’t left the station, there’s still time. Don’t let the building momentum stop you from doing what must be done. Yes, there’s the sunk cost of lining everything up and getting ready to go, but, no, that doesn’t justify a journey down the wrong track. Find the conductor and bend her ear. Be clear, be truthful, and be passionate. Tell her you’re not sure it’s the wrong destination, but you’re sure enough to pull the pressure relieve valve and take some time to think more about what’s about to happen.

No one wants to step in front of a moving train. It’s no fun for anyone, and dangerous for the brave soul standing in the tracks. And it’s a failure of sorts if it comes to that. The best way to prevent a train from heading down the wrong track is candid discussions about the facts and clarity around why the journey should happen. But we need to do a better job at having those tough discussions earlier in the process.

Unfortunately in business today, the foul underbelly of alignment blocks the difficult decisions that should happen. We’ve mapped disagreement to foul play and amoral behavior, and our organizations make it clear that supporting the right answer, right from the get-go, is the right answer. The result is premature alignment and unwarranted alignment without thoughtful, effective debate on the merits. For some reason, it’s no longer okay to disagree.

Difficult discussions are difficult. And prolonging them only makes them more difficult. In fact, that’s sometimes a tactic – push off the tough conversations until the momentum rolls over all intensions to have them.

Hold onto the fact that your company wants the tough conversations to have them. In the short term, things are more stressful, but in the long term thing are more profitable. Remember, though sometimes bureaucracy makes it difficult, you are paid to add your thinking into the mix. And keep in mind you have a valuable perspective that deserves to be valued.

When the train is leaving the station, it’s the easiest time to recognize the tough discussions need to happen but it’s the most difficult time to have them. Earlier in the project it’s easier to have them and far more difficult to recognize they should happen.

Going forward, modify your existing processes to cut through inappropriate momentum building. And better still, use your knowledge of how your organization works to create mechanisms to trigger difficult conversations and prevent premature alignment.

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Innovation’s Mantra – Sell New Product To New Customers

bull's headThere are three types of innovation: innovation that creates jobs, innovation that’s job neutral, and innovation that reduces jobs.

Innovation that reduces jobs is by far the most common. This innovation improves the efficiency of things that already exist – the mantra: do the same, but with less. No increase in sales, just fewer people employed.

Innovation that’s job neutral is less common. This innovation improves what you sell today so the customer will buy the new one instead of the old one. It’s a trade – instead of buying the old one they buy the new one. No increase in sales, same number of people employed.

Innovation that creates jobs is uncommon. This innovation radically changes what you sell today and moves it from expensive and complicated to affordable and accessible. Sell more, employ more.

Clay Christensen calls it Disruptive Innovation; Vijay Govindarajan calls it Reverse Innovation; and I call it Less-With-Far-Less.

The idea is the product that is sold to a relatively small customer base (due to its cost) is transformed into something new with far broader applicability (due to its hyper-low cost). Clay says to “look down” to see the new technologies that do less but have a super low cost structure which reduces the barrier to entry. And because more people can afford it, more people buy it. And these aren’t the folks that buy your existing products. They’re new customers.

Vijay says growth over the next decades will come from the developing world who today cannot afford the developed world’s product. But, when the price comes down (down by a factor of 10 then down by a factor of 100), you sell many more. And these folks, too, are new customers.

I say the design and marketing communities must get over their unnatural fascination with “more” thinking. To sell to new customers the best strategy is increase the number of people who can afford your product. And the best way to do that is to radically reduce the cost signature at the expense of features and function. If you can give ground a bit on the thing that makes your product successful, there is huge opportunity to reduce cost – think 80% less cost and 20% less function. Again, you sell new product to new customers.

Here’s a thought experiment to help put you in the right mental context: Create a plan to form a new business unit that cannot sell to your existing customers, must sell a product that does less (20%) and costs far less (80%), and must sell it in the developing world. Now, create a list of small projects to test new technologies with radically lower cost structures, likely from other industries. The constraint on the projects – you must be able to squeeze them into your existing workload and get them done with your existing budget and people. It doesn’t matter how long the projects take, but the investment must be below the radar.

The funny thing is, if you actually run a couple small projects (or even just one) to identify those new technologies, for short money you’ve started your journey to selling new products to new customers.

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Marketing’s Holy Grail – Emerging Customer Needs

In Pursuit of the Holy GrailThe Holy Grail of marketing is to identify emerging customer needs before anyone else and satisfy them to create new markets. It has been a long and fruitless slog as emerging needs have proven themselves elusive. And once candidates are identified, it’s a challenge to agree which are the game-changers and which are the ghosts. There are too many opinions and too few facts. But there’s treasure at the end of the rainbow and the quest continues.

Emerging things are just coming to be, just starting, so they appy to just a small subset of customers; and emerging things are new and different, so they’re unfamiliar. Unfamiliar plus small same size equals elusive.

I don’t believe in emerging customer needs, I believe in emergent customer behavior.

Emergent behavior is based on actions taken (past tense) and is objectively verifiable. Yes or no, did the customer use the product in a new way? Yes or no, did the customer make the product do something it wasn’t supposed to? Did they use it in a new industry? Did they modify the product on their own? Did they combine it with something altogether unrelated? No argument.

When you ask a customer how to improve your product, their answers aren’t all that important to them. But when a customer takes initiative and action, when they do something new and different with your product, it’s important to them. And even when just a few rouge customers take similar action, it’s worth understanding why they did it – there’s a good chance there’s treasure at the end of that rainbow.

With traditional VOC methods, it has been cost prohibitive to visit enough customers to learn about a handful at the fringes doing the same crazy new thing with your product. Also, with traditional VOCs, these “outliers” are thrown out because they’re, well, they’re outliers. But emergent behavior comes from these very outliers. New information streams and new ways to visualize them are needed to meet these challenges.

For these new information streams, think VOC without the travel; VOC without leading the witness; VOC where the cost of capturing their stories is so low there are so many stories captured that it’s possible to collect a handful of outliers doing what could be the seed for the next new market.

To reduce the cost of acquisition, stories are entered using an app on a smart phone; to let emergent themes emerge, customers code their own stories with a common, non-biasing set of attributes; and to see patterns and outliers, the coded stories are displayed visually.

In the past, the mechanisms to collect and process these information streams did not exist. But they do now.

I hope you haven’t given up on the possibility of understanding what your customers will want in the near future, because it’s now possible.

I urge you to check out SenseMaker.

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What Do You Believe About Independence?

PeaceIndependence is important; independence is powerful; it’s dangerous; it’s threatening. But, above all, independence is about control.

If you believe it’s a zero-sum-game, independence is adverserial – more for you, less for me. It’s give-and-take without the give – I don’t give you control, and you take it anyway.

If you believe there’s no trust, independence is scary. If you take initiative and demonstrate independence, you’re afraid I’ll repond negatively because you took control.

If you believe there’s no mutual respect, independence is spiteful. You give less control than you could and manipulate to take even less; I take more than the situation calls and politic to secure even more.

If you believe there’s a surplus, independence is empowering – more for you, more for me, more for everyone.

If you believe there’s trust, independence is exilerating. When you take initiative I tell the world you deserve all that control, and more.

If you believe there’s mutual respect, independence is nurturing. I push you to take more control, and you challenge yourself to do just that.

What do you believe?

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Do The Work No One Is Asking For

boredWe spend too much time on the mundane. Every day people come to work, turn on their PCs, and the mundane magically happens on its own accord. Email gets sent, phones get answered, mail gets delivered, and processes get followed. And after lunch, the hamster wheel spins back up and the mundane consumes the rest of our day. Yet there’s no need because that stuff runs on its own. It’s time to leave it alone and manage the mundane by exception. If there’s a hiccup, give it a drink of water, and otherwise leave it alone. It’s time to recognize the massive opportunity cost of the mundane – mundane comes at the expense of meaningful.

But when the mundane withers and there’s finally time for meaningful, there’s another chasm to cross – no one asks for meaningful work. Because meaningful work makes a difference and making a difference threatens the legacy of success, no one asks you for it. Because it’s considered impossible, there’s no request to do it. And because it’s considered a strength of your business, no one suggests you dismantle it. Crazy, but it’s time to stop the mundane so you can start doing work no one is asking you to do.

But it’s not any old work no one is asking for, it’s a special flavor, a flavor that meets a tight set of criteria.

Don’t do it unless it will make a difference. But not any old difference, a difference of epic proportions. If you explain the concept to the customer and they want to buy ten, you’re on the right track. If after you show the prototype the customer won’t give it back to you with a wrestling match, that’s the right work. If you present the concept to the core business unit and they immediately try to scuttle it, you’re on to something.

Don’t do it unless it resonates with you, personally. As subject matter expert, it must make your hair stand on end. As the inventor who must swim against the tide of “you can’t do that”, it must fill your deep need to help others. As the pariah who threatens the success of the company, it must be more than an idea – it must be part of you.

Leaders – it’s time to ask your people to work on things that are meaningful to them. Give them four hours a week and ask for an informal fifteen minute presentation every other week. They’ll make extreme progress and amaze you. Magically, because they’ll be so charged up, there will be time for all the work. Morale will skyrocket, the best folks will ask to work on your team, and you’ll have working prototypes for all the things you should have asked for.

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Occam’s Razor For Innovation

big sundialThere are many flavors of innovation – incremental, disruptive, and seven flavors in between. And there is lots of argument about the level of innovation – mine’s radical and yours isn’t; that’s just improving what we already have; that’s too new – no one will ever buy it. We want to label the work in order to put it in the right bucket, to judge if we’re doing the right work. But the labels get in the way – they’re loaded with judgments, both purrs and snarls.

Truth is, innovation work falls on a continuum of newness and grouping them makes little sense. And, it’s not just newness that matters – it’s how the newness fits (or doesn’t) within the context of how things happen today and how customers think they should happen tomorrow. So what to do?

Customers notice the most meaningful innovations, and they notice the most meaningful ones before the less meaningful. Evaluate the time it takes a customer to notice the innovation and there may be hope to evaluate the importance of the innovation.

The technology reduces cost, and at the end of the month when the numbers are rolled up the accountants can see the improvement. This is real improvement, but there’s a significant lag and the people doing the work don’t see it as meaningful. This one’s a tough sell – buy this new thing, train on it, use it for three months, and if you keep good records and do some nifty statistics you’ll see an improvement.

The technology reduces scrap, and at the end of the week the scrap bin will be half full instead of fully full. Scrap is waste and waste reduction is real improvement. This is an easier sell – buy it and train on it and at the end of the week you’ll notice a reduction in scrap. This is important but only to those who are measured on scrap. And today the scrap is emptied every week, now we can empty it every other week. The time to notice is reduced, but the impact may not be there.

The technology increases throughput, and at the end of the shift the bins will be fuller than full. Here – try it for a shift and see what you think. If you like it, you can buy it. I’ll be back tomorrow with a quote. This is noticeable within eight hours. And at the end of eight hours there are more things that can be sold. That’s real money, and real money gets noticed.

The technology makes the product last two hours instead of one. Here – try it for a couple hours. I’ll go get a coffee and come back and see what you think. You won’t have to stop the machine nearly as often and you’ll put more parts into finished goods inventory. The technology gets noticed within two hours and the purchase order is signed in three.

Where the old technology was load, this is quiet. Don’t bother with ear protection, just give it a go. Pretty cool, isn’t it. Go get your boss and I’ll sell you a couple units right now. This one shows its benefits the end user right away – first try.

The most meaningful innovations get noticed instantly. Stop trying to label the innovation and simply measure how long it takes your customer to notice.

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Experiment With Your People Systems

Battle_of_Waterloo_1815It’s pretty clear that innovation is the way to go. There’s endless creation of new technologies, new materials, and new processes so innovation can create new things to sell. And there are multiple toolsets and philosophies to get it done, but it’s difficult.

When doing new there’s no experience, no predictions, no certainty. But innovation is no dummy and has come up with a way to overcome the uncertainty. It builds knowledge of systems through testing – build it, test it, measure it, fix it. Not easy, but doable. And what makes it all possible is the repeatable response of things like steel, motors, pumps, software, hard drives. Push on them repeatably and their response is repeatable; stress them in a predictable way and their response is predictable; break them in a controlled way and the failure mode can be exercised.

Once there’s a coherent hypothesis that has the potential to make magic, innovation builds it in the lab, creates a measurement system to evaluate goodness, and tests it. After the good idea, innovation is about converting the idea into a hypothesis – a prediction of what will happen and why – and testing them early and often. And once they work every-day-all-day and make into production, the factory measures them relentlessly to make sure the goodness is shipped with every unit, and the data is religiously plotted with control charts.

The next evolution of innovation will come from systematically improving people systems. There are some roadblocks but they can be overcome. In reality, they already have been overcome it’s just that no one realizes it.

People systems are more difficult because their responses are not repeatable – where steel bends repeatably for a given stress, people do not. Give a last minute deliverable to someone in a good mood, and the work gets done; give that same deliverable to the same person on a bad day, and you get a lot of yelling. And because bad moods beget bad moods, people modify each other’s behavior. And when that non-repeatable, one-person-modifying-another response scales up to the team level, business unit, company, and supply chain, you have a complex adaptive system – a system that cannot be predicted. But just as innovation of airliners and automobiles uses testing to build knowledge out of uncertainty, testing can do the same for people systems.

To start, assumptions about how people systems would respond to new input must be hardened into formal hypotheses. And for the killer hypotheses that hang together, an experiment is defined; a small target population is identified; a measurement system created; a baseline measurement is taken; and the experiment is run. Data is then collected, statistical analyses are made, and it’s clear if the hypothesis is validated or not. If validated, the solution is rolled out and the people system is improved. And in a control chart sense, the measurement system is transferred to the whole system and is left to run continuously to make sure the goodness doesn’t go away. If it’s invalidated, another hypothesis is generated and the process is repeated. (It’s actually better to test multiple hypotheses in parallel.)

In the past, this approach was impossible because the measurement system did not exist. What was needed was a simple, mobile data acquisition system for “people data”, a method to automatically index the data, and a method to quickly process and display the results. The experimental methods were clear, but there was no response for the experiments. Now there is.

People systems are governed by what people think and feel, and the stories they tell are the surrogates for their thoughts and feelings. When an experiment is conducted on a people system, the stories are the “people data” that is collected, quantified, and analyzed. The stories are the response to the experiment.

It is now possible to run an experiment where a sample population uses a smart phone and an app to collect stories (text, voice, pictures), index them, and automatically send them to a server where some software groups the stories and displays them in a way to see patterns (groups of commonly indexed stories). All this is done in real time. And, by clicking on a data point, the program brings up the story associated with that data point.

Here’s how it works. The app is loaded, people tell their stories on their phone, and a baseline is established (a baseline story pattern). Inputs or constraints are changed for the target population and new stories are collected. If the patterns change in a desirable way (statistical analysis is possible), the new inputs and constraints are rolled out. If the stories change in an undesirable way, the target population reverts back to standard conditions and the next hypothesis is tested.

Unbiased, real time, continuous information streams to make sense of your people systems is now possible. Real time, direct connection to your employees and your customers is a reality, and the implications are staggering.

Thank you Dave Snowden.

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Put Yourself Out There

Its all goodPut yourself out there. Let it hang out. Give it a try. Just do it. The reality is few do it, and fewer do it often. But why?

In a word, fear. But it cuts much deeper than a word. Here’s a top down progression:

What will they think of your idea? If you summon the courage to say it out loud, your fear is they won’t like it, or they’ll think it’s stupid. But it goes deeper.

What with they think of you? If they think your idea is stupid, your fear is they’ll think you’re stupid. But so what?

How will it conflict with what you think of you? If they think you’re stupid, your fear is it will conflict with what you think of you. Now we’re on to it – full circle.

What do you think of you? It all comes down to your self-image – what you think is it and how you think it will stand up against the outside forces trying to pull it apart. The key is “what you think” and “how you think”. Like all cases, perception is reality; and when it comes to judging ourselves, we judge far too harshly. Our severe self-criticism deflates us far below the waterline of reality, and we see ourselves far shallower than our actions decree.

You’re stronger and more capable than you let yourself think. But no words can help with that; for that, only action will do. Summon the courage to act and take action. Just do it. And to calm yourself before you jump, hold onto this one fact – others’ criticism has never killed anyone. Stung, yes. Killed, no. Plain and simple, you won’t die if you put yourself out there. And even the worst bee stings subside with a little ice.

I’m not sure why we’re so willing to abdicate responsibility for what we think of ourselves, but we do. So where you may have abdicated responsibility in the past, in the now it’s time to take responsibility. It’s time to take responsibility and act on your own behalf.

Fear is real, and you should acknowledge it. But also acknowledge you give fear its power. Feel the fear, be afraid. But don’t succumb to the power you give it.

Put yourself out there. Do it tomorrow. You won’t die. And I bet you’ll surprise others.

But I’m sure you’ll surprise yourself more.

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Mike Shipulski Mike Shipulski
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