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Innovation

Entrepeneurship, Innovation, IT is business

Have you already tried to buy software per sprint?

June 28, 2019

Lack of understanding of business by IT and of IT by businesses may still be one of the main issues when building software. 

Main issues on buying fixed scope/price software

The main common thoughts when somebody starts to think about creating some software is that it will be something similar to any other stuff we buy. How much will it cost? And how many time will it take to be done?

I’m trying to demystify the bad comparison between building a house and building software that commonly takes places during these conversations.

Software is a baby

We tend to think that building software is similar to building a house or a tower. But this parallel/analogy is impossible nowadays. For centuries, houses have been built and the process has reached a maturity that it’s possible to put all the information in 2 or 10 blueprints, and everything the buyer said he wants will be there well described.

Softwares have been created for less than 100 years (since the 1950s) and until today there is no way to put all the information on a document that can be followed from the very beginning to the end. Invariably, the documents have a macro vision of what is wanted with the pages described. But, as an example, what should happen when I hit the button “notify user”? Does it send an email to one user? Or does it triggers a background processing involving AI looking for all the users that match the current data and send them a push notification on their phones?

PMI addresses this scenario writing huge documentations with plenty of details following the PMBOK. But only some software have this level of detail. For the entire rest (the biggest majority I’ve seen during 10 years on IT) companies can’t afford the investment for having this level of detail.

Different complexities

Back to the analogy of houses. When you are building a house, the level you reach when designing the architecture (similar to the requirements document in software) will be the walls, plumbing, electricity, network and etc. But at that level, you don’t describe how the house will be decorated (the UI on software). How many paintings will be there? Which will be your sofa? How many inches will have your TV? Your kid’s room will be Superman or Batman’s?

Obviously, this is not described because people will have different opinions on how to decorate the house. And these opinions change from time to time. When talking about software, sometimes these UI behaviors are just not described at the level they should be.

The migration to agile

Given the scenario above and after severe issues developing software, eventually, companies start the migration to agile. Currently agile is the fastest approach to address the issues that come when a scope is not clear/detailed enough. Gartner (ID #G00325642) says that the main barriers for the change from fixed scope / fixed price to agile are:

  1. Sourcing and finance:
    • Sourcing: It’s hard to tell how much the software will cost. In organizations structured like having a hard sourcing process, this will be one of the main challenges.
    • Finance: the organizations have their financial operations structured as price per project. Budgeting for treating the software as a product instead of a project can be complex in some organizations;
  2. People’s routine adaptability / culture / mindset:
    • Be prepared to face challenges on people behavior when migrating to agile. It’s a new way to work, and everything new creates resistance.
    • As one of the key features of agile development, the ability to adapt your software alongside its development is essential. When applied to organizations changing, some issues will arise:
      • Since the scope can be changed at any time, people may fall on the trap of keep trying to reach perfection on some requirement and spend too much time on it, instead of moving to next requirements, making the entire cycle slower.
      • In some times, it’s easy to lose the UX pattern, as the features that have already been delivered may have functional or design differences from the next ones;
      • Managing people will have different KPIs to measure performance and quality. Finding the right ones to your project won’t be quick;A

A hybrid approach

The more flexible the scope is, the bigger the risk is for the client. The more fixed the scope is, the bigger is the risk for the vendor.

A good hybrid model between fixed scope and 100% agile can be the purchase per sprint/phase (Gartner, 2017 – ID #G00325642). You will need a big picture of the project to use this model. Starting from an initial internal estimate of price and time, the client will be able to go for the market and call vendors to produce the software. The software production will be done sprint per sprint. Every new sprint beginning has a new deal. What will be inside this deal is:

Anatomy of a per sprint deal:

  • Start and end dates (2, 3 or 4 weeks are good to start);
  • Price for the sprint;
  • The stories to be delivered;
    • Every story must have a clear DoD (Definition of Done);
    • Every story must be detailed enough for the team to work on without blocks.

For this model to work, the product owner has to have the autonomy to sign. This cannot involve an entire cycle of procurement.

The benefits

Developing projects per sprint puts the risk balance somewhere closer to the center. And here I list some key important outcomes of the change: 

  • For the client:
    • They can stop the work whenever they want without long term contractual strings;
    • The client will be able to apply new business decisions whenever he wants;
    • The client will be able to respond quickly to market and competitors changes, without having to wait for the current project to finish and then start an entire negotiation once again;
    • If something is delayed from one sprint, it will be the vendor’s responsibility to solve without generating new costs;
  • For the product (software):
    • One of the key benefits of flexibility is the possibility to involve more people that are experts in some specific process. Then the product will fit better what the users want, and not what a group of people (like the old project manager and system analysts) think they want;
    • The product will be flexible to respond fast to business decisions and users feedbacks;
    • Practices focused on finding innovation can be turned into a routine. Running design sprints, inceptions, usability testing, and user interviews are some key practices that would be done without affecting the project continuation;
  • For the vendor:
    • The vendor will have clearer information to work with. Less double understanding of requirements will happen;
    • The vendor will have more flexibility to turn into more like a consultant, bringing knowledge from many different projects. Both technical practices and business decisions will benefit;
Digital transformation, Innovation, IT is business, Practical examples

5 reasons to start and speed up digital product management

November 4, 2018
Digital Products

One of the main objectives of a well-planned Digital Transformation journey is the creation of Digital Products. Having Digital Products means that some of the core systems of the company can be turned into a product or service. Other partners can benefit from! Or even your data will allow you to create new products that didn’t exist yet. That means new revenue streams, not necessarily aligned with the current business.

Some examples are famous and some of them are pretty new, showing that to create useful Digital Products all you have to have is the will to make a difference:

  • Retail started what we can see now. Then banks came with their apps, home banking, credit cards, insurance simulators and etc. All this Digital Transformation reality got strengthen with them;
  • BTG started in 2014 what nowadays is the SnakeBite911 app. With that people can collaborate and mark where they’ve been attacked the most by snakes. For BTG, they are offering clinical trials and have many other offers to come.
  • Vivino is a social network for wine lovers. A score for each wine and many other details can be added by the user. Vivino has been using the app to offer wine to the huge number of users they got.
  • Companies that sell farming fertilizers are mapping region’s soil, the weather forecast for the year and the next, and many other data. This way they can suggest their clients which fertilizers they should buy and when to buy it;
  • Health: apps who help runners to monitor their evolution, tracking how people feel while they train and suggest shoes, nutrition hints (and products), next events, etc. Also, smart things (like shoes and swimsuits) are already available, tracking a lot of data, and suggesting a lot of products and services to be acquired.
Be the one pushing the change

Some changes happen on how you and your team behave when you change from project to product-centric approach:

Project-centric Product-centric
Delivery – that’s the mission! Owning – change everything. The culture will change, the will to be part, motivation, etc etc etc
Stay on backstage – yeah, IT usually is just the way to reach something, not the something that must be reached Stay in the front stage – IT leaders start being at the front stage alongside with business leaders
Sensation of completion – leading to… nothing. Just more tasks; Continuous – apply the mindset of improvement, avoiding the team’s sensation that a project who completely satisfies the final client is never delivered

The 5 reasons

1st – “By 2020, 75% of digital business leaders will have abandoned Project model and adopted product management model”opening keynote from worldwide flagship IT event in Orlando 2018. Project model is not fast enough. Every time a project ends, the team is disbanded. Then new negotiations for the new cycle of improvements start. But until its end and the new team come, is waste of time and waste of the team’s knowledge.

2nd – “By 2020, organizations that have embraced the product model will outperform the competition that has not, in both customer satisfaction and business results (Gartner)”. Since product-centric is faster, we must adopt it in order to stay ahead of the competition.

3rd – “78% of companies growing the most on American market are using a product-centric delivery (Gartner)”. Nothing to add here.

4th – “A product-oriented company’s IT department depends less on HR interventions, and takes by itself the leadership of culture and self-development initiatives with internal teams (Gartner)”. The first change is more power and influence to IT. But that doesn’t mean the other areas will be weak. It means they will put strength together to make things happen to have both visions: business-led and IT-led. None of them can exist without each other.

5thEvolve the IT to turn into a hub to attract internal and external ideas, business partners and talent attraction (Gartner).

Having Digital Products in mind, the benefits above are natural, and the reasons to do it are compelling. It’s the fastest way to approach traditional companies to how the unicorns that are changing our economy are.

 

Recently I attended the Gartner Symposium ITxpo in Orlando. Gartner shared some of the insights here (properly mentioned on the links). The rest of them I had while listening to the keynotes.

Digital transformation, Innovation, IT is business, Practical examples

Health awakes for DT

September 21, 2018

During the past week I had the opportunity to attend to an important trade fair in USA for IT decision makers in midmarket companies. It was an incredible experience to talk to many people who are in charge of the future of their companies.  I got really impressed to know what they are looking for and what are their real concerns by the end of 2018.

Special mention:

Before getting to the real point of this article, I have to mention that I got to know many important and intelligent people. They were looking for the same old solutions to solve problems that were already solved a million times. I saw people looking for solutions that were created in 2007. That’s impressive but that’s also a sign that we all are inside a cycle. And we all are evolving. That’s the coolest thing about the event.

 

To the point: Digital Transformation one more time

It’s not new for everybody that financial industry is heavily affected by Digital Transformation. I can’t find a single bank that isn’t looking for that. Some of them are looking for experience enhancements; others are all about regarding automation. And the majority of big companies already past this phase and are already looking for omnichannel. It’s not that strong when we look for insurance, mortgages and some other industries. They have a different pattern. But they are all in similar situation: evolving.

Beside financial, we’ve heard some real cool moves from Amazon (a benchmark of course) in retail, and many others. But after financial and these moves in retail, it’s being kind of difficult to find the next industry witness for DT.

The health woke up

I had an incredible opportunity to talk to three chairmen for health. They are concerned about some things but they all mean the same thing. Their concerns were:

  •         Stop developing apps without previously validating if that is the real thing their end-user is in need;
  •         Generate business value from IT because of competitor’s moves;
  •         Take care of the little monsters that shadow-IT created and now they have to support;

If we look outside the box, those gentlemen were concerned about the same thing, as their next step for Digital Transformation: engage business areas;

Their initiative is great. But it’s also late. I’ve been discussing the third symptom with financial companies for the last 6 years. That’s always the same: an isolated initiative from a business area innovating creates something new that gets strength in the organization. But they are not IT. They don’t have the needed experience to support this new product/whatever else. Then the IT is called and they say: “hey, now you have to support this”. The nightmare starts. For the first two points, it looks like the company already got some good insights and is trying to actually act seriously towards DT.

What’s their scenario

Since they are looking for generating more value from their business areas, I thought quickly about some issues when I have to do something related to health, also did a very quick research (not more than 15 minutes – Forbes source) for the most common issues on health that now can be solved with IT and will to do:

  •         Disabled assistance: If there’s a disabled patient, let’s automatically call an Uber at the end of his appointment to take him home;
  •         Market knowledge: get to know what the clients are thinking. Let’s monitore social networks with AI and check if they are complaining after an appointment;
  •         Accessibility: a lot of paper is sent to people when they have to pay for health services or when they just use it. Let’s group all of that digitally;
  •         Accessibility: there isn’t a single repository that a doctor can access all of their patient’s history in diseases, symptoms and treatments. It forces people to carry a lot of paper whenever they are going to a doctor to talk about something recurring;
  •         Omni-experience (Forbes): I guess I’ve already heard that in financial and somewhere else. There it’s called omni-channel. And it’s coming to health. Here’s what it is: everytime your customer gets in touch with our brand, either online or offline, we must assure that he’ll have the best possible experience. Every point of contact matters;
  •         Health-techs: let’s connect to them. There are many coming and many more to come. Let’s send our doctor the information of our home-based check-up system. Blood pressure, weight and some other stuff can be checked remotely. And will mean a huge difference for some patients.

The same things that are very clear in financial are starting to happen in financial. The main thing is the mindset: having the will to solve the same old problems, digitally. Forbes says: it must come from above. If the health company’s sponsors don’t buy it, nobody will.

Digital transformation, Innovation, IT is business

Focus on UX is excellent but not enough

June 19, 2018

When you are designing a new product to get that market share or add a new slice of target people to your company, if you are talking about B2C it’s not possible anymore not to look for user experience. But if you are already good on user experience experts, you know they aren’t everything in a project. Since UX is basic, I’m suggesting the experience and ease to use to be faced as a consequence of a good product design. It means that your UX can be the best in world, but it means nothing if the business idea isn’t good. But how to align your business design to ensure you will reach the expected result?

 

UX is not enough

Whenever a product lifecycle comes to end, and it’s time to design a new one, a lot of questions are made. For sure many things were tried to save that product. But the face the truth: the competition won the fight. In this time you have an opportunity to join the digital transformation wave.

Nowadays our products have to act like Google, Netflix, Apple and big experience brands because people don’t accept less than that. Regarding that, I’ve already seen some companies hiring UI/UX professionals to create the screens for their idea without knowing if the idea is good or not.

 

The whole process is the key

The differences between the traditional business analysis and the new business design focus on “how” to do things. Companies have been aligning their processes/journeys to decrease the risks based on digital transformation insights. But how is that made?

The comparision
Traditional analysis New Business Design
The analyst used to be the owner of truth. Responsible for taking the decisions and at hard times used to be the focus of pressure The business analyst turns into a facilitator. His mission is to lead people and collect their best thoughts and efforts to add to the solution. His hardest part turns into finding differences between the good insights and what is just waste of time
The analyst used to work alone, traveling around the world to bring insights and getting few (when getting) feedbacks about the product development The analyst will accept as many opinions he can. The more people he has with him, the more insights will come. The more free people are to think and imagine, the better the insights are.
Focus on the process to be solved. All the efforts were sent to look specifically to that process. The focus is wide (???). The focus is to create a new product, but not sticking to industry patterns or existing knowledge.
Knowledge restricted on the existing business. The focus were to make more money with low or no change on the business model Insights from a cross-industry mindset are a differential in this new team. Why not apply Uber’s business model to our hundred-years business?
Ideas blind love. It was common to fall in love with a product idea and close your eyes to what’s going on your side Stick to the process, not the idea. Test, validate and have a experimentation mindset is the rule. If an idea takes more than 1 month to be proven (and this is not the only one under evaluation), discard it.
Unproven decisions. Nobody could ask or speak their mind about the idea. It made many products be useless because of blind view of market. Everybody can make their own questions to the idea. EVERYBODY. If the just hired member of the area brings an insight that can turn the idea into waste, let’s celebrate! He saved us from spending money.

 

The challenge of starting

As always, the main challenge is to start. I’ve two suggestions that already worked on huge companies around the world:

  • Retrospectives: probably the hardest but if it work, your cultural change will be huge. Have mature people to conduct mature retrospectives to focus on what must be improved. Do that at every department responsible to product creation. After some time, people will reach the conclusions suggested on the paragraph above.
  • Cancer theory: create a new cell apart from the entire company free to work on the new model. There must be people with maturity and autonomy to apply the new methodologies that can come either from your team or a consultancy. When this team prove themselves is time to spread to the whole organization.
Digital transformation, Innovation, IT is business

Massification of user experience as a business strategy

May 24, 2018

This article can be faced as a step ahead of this one suggesting user experience as the main driver for successful business models.

The massification of good user experience is a trend and it makes a huge sense. Let’s discuss why and some opportunities we can easily see ahead.

 

People are demanding about good experiences

When you are planning a trip and want a flight with more comfort, it costs more. A special consultant to assist you during your buying experiences, will cost more (there are even stores that plan for times with closed doors to meet only one single and special buyer at a time). Product faster delivery? More money. When you want to visit a special beach in your vacations, and want a boat just to you and one more with you, it costs more. People with high acquisition power have it and look for it naturally because they can afford.

But everybody want good experience. Everybody want to feel they are different. They feel special when they receive unique treatments. But not everybody have enough money to pay for unique experiences. And it’s completely reasonable. Better experiences will require either more people involved or more specialized people involved to deliver that in a customized way.

Products and services’s experiences

It’s possible to deliver a better experience when we talk about products in an easier way. When you buy a product from Apple, the experience is incredible. It was designed by a group of high qualified people inside one of the most innovative companies in world, and then copied to everybody who buys the result. They think about the product in California (expensive), and produce it in China (cheap). When you buy a Tesla, the experience is also meaningful. It drives by itself, is secure, can be accessed through a mobile phone. No one has done that before. When you buy a piece of clothe from Nike, it is not very different than other brands, but you know it’s a Nike and you are wearing the same of many athletes.

When we talk about those services which require a lot of attention, the good experience gets way harder to achieve. Meals, travels, entertainment, financial services, in-store purchases and many other require more subjective requirements to show a good experience. And it does because trying to teach everyone inside your company to provide the same experience is the same of teaching them to be actors. Once you are delivering something from person to person, the best scenario is that (I.E.) the employee who got inside McDonald’s yesterday serve their customers the same way the owner would. The employee who was hired in the nails saloon won’t have the same experience of the owner who has been running the business for a decade. It’s impossible (for now). It requires experience and commitment to your job. Not everybody want to do that. Actually you could only hire the best people in world to serve your BigMac or to make you up but that would cost a lot of money.

Disney achieved that perfect scenario of experience in services and is a world benchmark. I can’t remember another one now.

Technology

When we start to think about how technology can assist that experience mission, some of these mentioned services start getting easier to improve.

  • How much money would cost to have thousands of movies available at your home? Netflix solved through technology;
  • How much money would you have to have to count with a special treatment from a bank account manager that will only offer you what is really interesting to you and not for his yearly goals? Digital banks solved that with technology;
  • How much time would you spend searching for a good price for your next trip going physically from store to store? Booking.com solved that gathering everything online. And did that in a cheaper way than the stores;
  • How much would cost you to have a personal consultant tracking what you like to say wherever and personalizing that to buying suggestions? Amazon solved through suggestions (AI) and Google by ads (BigData);

All the examples above used to be services that would require more time or money on customer’s side. Technology gives them autonomy to look for/do everything when they want. The autonomy is part of a good experience. The ease to use is important, the speed and all the steps required to reach a goal matter.

Opportunities
  • Why is it so hard to deal with flights miles in some companies? It should be all automated. We do have technology for that.
  • Cable TV companies could offer customized plans for people. This way people could buy only those 10 channels they are really interested in. Let’s put technology here!
  • Why can’t we design our own mobile phone plan? 1h of calls, more 10gb of internet and international usage costs you (fidelity plans here) only 50 dollars a month. Let’s try to measure usage in different ways.
Entrepeneurship, Innovation

5 steps to have an innovative mindset in your company

April 23, 2018

Nowadays when we talk about business, companies, money, processes, and everything else, we always turn to innovation. Improve internal process? Innovation. Make a new software to cut and automatize processes? Innovation. Make more money or save more money? Innovation.

All knowledge areas talk about innovation. Cientists always look for innovation to get new formulas, theories and progress. Banking people innovate to get bigger profit margins. Architects innovate on construction to find cheaper and more resistant materials. IT professionals innovate to make faster systems that make user experiences more and more immersive.

Once all areas have to innovate, what new and traditional companies do to make that possible? How to foster an innovative environment? What results can be expected from which kind of innovation?

 

Break hierarchy

The hierarchy kills innovation. Face that. The person who is suggesting the innovation cannot rely on judgement of another 4 or 5 people above his hierarchical level until the idea reach those who will really understand it.

The faster incremental innovations well succeeded are those who research for consumer behaviour. It’s a quick innovation, it’s inside every user of your tool. You just have to ask for it. It cannot wait for hierarchy.

People are afraid of getting their ideas ahead because they think they will be judged. They are afraid of the feedback in case their idea is not good. When there are too many steps to be “won”, the idea will die without reaching the ears of whoever really matters. Given that, let’s get to the next step.

 

Have many ears

I’ve seen many clients being proud and saying “we created an innovation area!” with big budgets! I’ve already seen the “innovation area” be the new name for R&D team (Research and Development). I recognize the innovation has to start somehow, but restricting the ears only to the voices coming from the innovation area is dangerous. Yes, it’s a step, but just that. If it’s the way to start, let’s go!

But always keep in mind that small companies with few employees don’t have innovation areas:

  • Nubank has a department called “Wow! Factor”. As the name suggests, their goal is to create experiences to impress their customer. But their innovation doesn’t come only from the “Wow! Factor” department.
  • Your scenario is a big company? Think about Google. With thousands of employees, 20% of their time is free for them to work on their own ideas.
  • Ok… Google’s business model allow them to have idle time because their money factory is automatized? Cool, let’s take a look at Apple. It sells hardware, it’s a factory. It’s one of the most innovative companies in world.

 

Encourage intra entrepeneurship

The final objective is to innovate, but the innovation only will come when people think outside the box. To think outside the box they have to feel comfortable and understand they have freedom to suggest ideias and they won’t be cutted.

 

Focus on “How”, not on “What”

An idea whose owner judges awesome, but after evaluation be discarded, requires much care:

  • If the owner don’t get any feedback in a fair time, they will demotivate. Don’t let him into limbo.
  • If the owner don’t get convinced about the reasons why their idea won`t be taken ahead, he will demotivate. Don’t let him without explanations.
  • Help the owner to identify the main idea. If more scenarios over their idea are not explored, they can demotivate. Help him to understand that creating a new credit card is a way to solve something, but the innovation can be if he looks for new payment methods.

 

Start

There is not how-to here. It depends only on you. Big consulting companies will have ready models, costing millions of dollars about how implementing “digital transformation” i.e. It won’t work. Your culture won’t allow it to work. Innovation is incremental. It won’t have preset costs and schedule. Nothing is invented and evolved at the same time (beautiful sentence, not invented by me).

Think by yourself how to start. Establish plans, go for innovation theories and how the innovation happens. Once you get how the innovation happens, you will conclude where to start. Suggestions: Lean, design journey, agile software development methodologies.