New IT Innovation Development (N.IT.I.D) method Step 5: Select Solutions (Tripadvisor Case Study)


NITID-Select_Solutions

See also:

After brainstorming, simplifying, organizing and evaluating all the ideas, finally it’s time to select the BigData solution in which to invest.

Thanks to the QFD matrix, the key parameters  and competencies that are required for fulfilling the customer needs have been identified.

Moreover, the QFD assesses how the development of a new idea will change the strategic position of the company in the market through a gap analysis.

Anyhow, which idea to choose among all the bigdata IT initiatives?

The question can be addressed by using the Pugh matrix in the table below.

Pugh_Matrix

In particular, in our PUGH matrix of TripAdvisor, all bigdata initiatives are the new functions (needs) to implement and putted into rows: facilitate the process, establish an integrated supply chain, create customer experiences, engage customers and provide statistics and reports.

Meanwhile, all the IT solutions (requirements) are putted into columns: WEB user interface, restaurateur interface, suppliers interface, social networks, visual charts, external company’s interface, data analytics and predictive tools.

In the PUGH matrix a final benchmark is accomplished by assigning for each interception a score that might be -1, +1 or 0, respectively if the solution proposed is worse, better or equal on satisfying the specific need to a solution defined as a reference (market).

The solution to use as a reference for the in the Pugh matrix should be either one of the best solution of the market (e.g.: Booking) or the solution AS-IS that is currently provided to the customer.

The Pugh result is given by the sum of all the scores into rows and it is representative of much innovative and useful solution is.

As an example, according to results in the PUGH matrix, the most innovative solutions are the creation of a social network and the external company interface (EDI).

However, within a strategy plan definition such solutions might be risky due to the investments involved, more IT complexity to manage and agreements with stakeholders.

On the contrary, WEB user interface and Visual Charts, that have the second highest score (3) might be easily implemented and ready to use by the users of TripAdvisor. Thus, these solutions might be developed in order to quickly get a competitive advantage.

Not necessarily, the highest Pugh score is the best solution must be choosen. In this sense, the Pugh matrix is useful, rather than univocally determining one IT initiative, to encourage and stimulate a well-defined strategy with a proper staging.

In particular, in a strategy plan based on Pugh’s results it might be stated that a social network should be created only when the customer engagement has been improved enough thanks to WEB user interface and Visual Charts. By doing so, it is possible to leverage the customer commitment for achieving the network effect when promoting the social network initiative.

Similarly, if becoming a platform for an integrated supply chain is one of the long-term objectives, a proper staging and pace of the related IT initiatives should be defined in a way that fits the company DNA (see A question about IT change management: does the DNA of the company fit your IT vendor?).

For example, if TripAdvisor is a “cautious adopter”, it will better to first implement restaurateur’s interface IT initiative in order to engage them and then involve also suppliers with supplier’s interface.

Furthermore, as an example, specifically for the data analytics and predictive tool IT solutions (requirements), the KPIs to adopt are linked with the key performances evaluated in the QFD matrix through the need “providing statistics and reports” (see Table in New IT Innovation Development (N.IT.I.D) method Step 4: Evaluate Solutions).

In particular, the key parameters are data redundancy, correlation, representatives, etc. as a measure of the quality of the data to gather and collect. In such a way, it will be ensured reliable information and insights by considering all the relevant aspects: information theory, statistic, control theory and psychology (see Caution!!! BigData S.L.I.P.S.: five tips when using analytics).

With the Step 5 (Select Solution), the N.IT.I.D method for developing new business model thanks to BigData is accomplished.

So… Would Tripadvisor adopt new BigData initiatives?

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New IT Innovation Development (N.IT.I.D) method Step 4: Evaluate Solutions (Tripadvisor Case Study)


NITID-Evaluate_Solutions

See also:

After brainstorming new idea and organize them, the next step of the N.IT.I.D. method is to evaluate the solution proposed for the TripAdvsor case study.

The KJ method in the Step 3 (Organize), it has been possible to organize the un-structured brainstormed ideas in a structure way. The next phase is to connect all the ideas grouped with KJ method with the key performances needed in order to satisfy new functionalities.

In order to evaluate the solutions, all the key performances must be measurable. For example, the “facilitate the process” BigData initiation needs a new WEB interface to develop in order to create a list of pending reviews. In this case, some key measurable parameters for the interface should be the delay and inconsistency between the pending reviews shown and the incoming new receipts.

In the Table below are shown all the BigData ideas, IT infrastructures required and the KEY parameters that should be considered respectively as:

  • new needs
  • requirements
  • and Key Performance Indicators (KPIs)

BigData_Initiative - needs, requirements and KPIs

By putting needs into rows and the list of KPIs listed in the Table into columns, it is possible to create the QFD (Quality Function Development) matrix (see Figure below).

BigData Initiative QFD Matrix

In this example it has been assigned a score for each KPI with values X (no relations), 3 (weak relation) or 9 (strong relation) and an importance rating (e.g. from 0 to 9) for each new need accordingly to the priorities and objectives of the company.

For example, the importance rating should be assessed by considering factors such as the customer value curve, opportunity to innovate for getting a competitive advantage or risks (e.g.: disruptive innovations from competitors). Finally, the QFD score for each KPI is given by the sum of the scores intercepted by weighting (multiplying) them accordingly to the importance rating.

The aim of the QFD matrix is to link in a structured way the ideas (needs) with the key performances. Moreover, by assigning a score for each KPIs that measure its importance in order to satisfy the need it is possible to obtain an indicator of relevance for each key performance.

In the example, KPI inconsistencies (fake reviews and Negative SEO) is the most relevant KPI to consider since got the highest score (117).

Meanwhile, according to the importance rating, the most relevant ideas are Engage Customers and Facilitate the Process.

However, are they the ones that should be really implemented by TripAdvisor?

To be continued…

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New IT Innovation Development (N.IT.I.D) method Step 3: Organize (Tripadvisor Case Study)


NITID-Organize

See also:

A new business model for Tripadvisor has been developed thanks to BigData IT Innovations.

After brainstorming (Step 1) and then simplifying (Step 2) the founded new opportunities emerged from such a new business model, the next step for the N.IT.ID method is: Organize.

The purpose of organizing is to obtain a set of ideas and innovations that are structured according to a criteria that will be useful during the remaining two steps 4 and 5: Evaluate and Select.

So, after Step 2- Simplify, on the table there are the following opportunities for Tripadvisor thanks to BigData Innovation:

A) Facilitate the Process

B) Establish an Integrated Supply Chain

C) Create Customer Experiences

D) Engage Customers

E) Provide Statistics and Reports

 The Step 3 – Organize, consist on the following procedure:

  1. unify the remaining ideas into rational association of affinity group;
  2. rank the groups;
  3. group the unified ideas into a rational association affinity group (2nd level group) as it has been done at point 1;
  4. assign to each 2nd level group a general topic (avoid a list of ideas) or a common theme;
  5. identify relations among groups (correlations, dependencies,…).

In details:

1) Unify the remaining ideas into rational association of affinity group

In order to create affinity groups, it is necessary to define a criteria. Let’s assume as a criteria the function in the company (value chain), that would be involved for each idea.

With such a criteria the affinity groups are as follows:

Affinity_Groups

In particular, within the organization of Tripadvisor, A) facilitating the process and B) establishing an integrated supply chain are about its Operations’ activities.

While C) Creating Customers Experiences and D) Engaging customers they are responsibilities under Sales & Marketing department.

Finally, D) Providing Statistics and Reports might be considered as an additional Service (e.g.: after sales).

2) Rank the groups

As it has been done during the previous N.IT.I.D Step 2 – Simplify, it might be useful to further reduce the number of new initiatives by ranking the affinity groups and eliminating those groups that are less important.

For example, each team member should give a vote between 1 to 6 accordingly to its perception of importance (1 = low, 6 = very high) and then keep only the highly scored groups.

In this case, since there are only three groups, it does not make sense eliminate any groups.

Better would be to keep all the three groups for the next N.IT.I.D. – Step: Evaluate.

3) Group the unified ideas into a rational association of affinity group (2nd level groups)

In a similar way at point 1, group again the groups of ideas that are similar according to another criteria.

Using as a second criteria the Stakeholder potentially involved that are Customer, Suppliers (Restaurateurs and Hotels) and Collaborators, here below the 2nd level affinity groups:2nd_Level_GroupsIn particular, Customers & Suppliers are engaged in the idea A) facilitating the process and B) establishing an integrated supply chain.

While, Customers & Collaborators  are involved for C) Creating Customers Experiences and D) Engaging customers.

Finally, D) Providing Statistics and Reports might be considered as an additional Service (e.g.: after sales) for Suppliers.

4) Assign to each 2nd level group a general topic or common theme

As for N.IT.I.D Step 2 – Simplify, define a general topic or common theme that labels each 2nd level groups.

As labels for 2nd level groups just keep the stakeholder involved so that the general topics are:

  • Customers & Suppliers
  • Customers & Collaborators
  • Suppliers

5) Identify relations among groups (correlations, dependencies,…).

The last point is to identify relations among the 2nd level groups. In particular, as it is shown in the Figure below, there are two relations: one that is related to customers and one that is related to suppliers.

Precisely, the customer as a stakeholder create a link between “facilitate the process” and “engage customer” functionalities, while suppliers enable a connection between “integrated supply chain” and “provide statistics” ideas.

Groups_of_Ideas

An example how it looks like…

The Step 3 – Organize is actually the so called KJ Method developed by Jiro Kawakita.

Writing all the ideas into cards and using a whiteboard where to post them, it would be useful in order to have always the view of the “big picture” during the process.

Here below an example of it might look like a N.IT.ID process after Organize (Step 3).

KJ Method

To be continued…

Feelink – Feel & Think approach for doing life!

New IT Innovation Development (N.IT.I.D) method Step 2: Simplify (Tripadvisor Case Study)


NITID-Simplify

See also: New IT Innovation Development (N.IT.I.D) method Step 2: Simplify (Tripadvisor Case Study).

Thanks to the new data available for Tripadvisor, it has been applied the N.IT.I.D. process, and after the first step (Brainstorming), there are on the table the following opportunities:

1) Facilitate the process of the reviews for users by updating a list of “pending reviews” to fill once a new bill in a restaurant\hotel has been recorded.

2) Create “customer experiences” through new visualization charts such as a map of visited restaurants and hotels and\or a social network that connect users together in order to share the experiences.

3) Engage customers by creating synergies with loyalty programs.

4) Provide statistics and reports that might be useful to restaurateurs and hotel managers.

5) Establish an integrated supply chain by providing further additional services to restaurateurs and hotels.

All these ideas required investments, in terms of IT infrastructures, human resources and agreements with stakeholders or third parties. Will such investments have a return?

Hard to say now. Better first to jump at the second Step of the N.IT.I.D. process: Simplify.

A brainstorming session usually produce a redundant, inconsistent and  sometimes irrelevant set of ideas. Thus, a rough simplification could be done as follows:

1. Give to each idea a senentence\image

The idea\image should identify briefly the concept. In this case, simply let’s keep as images for the opportunities mentioned above the words in bold: facilitate the process, create customer experiences, engage customers, provide statistics and reports, establish an integrated supply chain.

2. Remove redundant ideas

After giving a simplified sentence, some ideas might be redundant. In this case, no redundancies emerged and thus all the idea should be kept on the table.

3. Rank each idea

With a set ideas that are unique (no redundancies) a vote among all the team members should rank the opportunities. For example, each member can give to each idea a score between 1 to 6: 1 not relevant at all and 6 extremely relevant.

The sum of the votes than will rank all the opportunities by theirs relevance.

An important recommendation: when ranking, each team member should evaluate ideas with a score between 1 and 6, without providing any justification. The vote should be only about perceptions, intuitions, and feelings. As Edward de Bono would say: “wear the red hat!” (see 6 Thinking Hats).

4. Keep only the most relevant ideas

After ranking all the ideas, the group might decide to keep only the most relevant ones (e.g.: first ten idea). Anyhow, do not throw away the removed ideas. Keep them in a temporary basket because they might be useful during steps 4 and 5 (Evaluate and Select solutions).

In our case, since there are only five items, all the ideas will be kept as important for the next step: Organize.

To be continued…

Feelink – Feel & Think approach for doing life!

New IT Innovation Development (N.IT.I.D) method Step 1: Brain Storming (Tripadvisor Case Study)


 

NITID-BrainStorming

Immagine that a business model described in “New IT Innovation Development NITID: Tripadvisor Case Study” is in place where new data is available for Tripdavisor:

1) the receipt (WHAT)

2) the client user ID (WHO)

3) the GEO position of the restaurant (WHERE)

The purpose of collecting such data is to ensure a better service for customers by ensuring an effective countermeasure against Negative SEO tactics.

Anyhow, is this really all? How such a new data availability might be exploited? This is the aim of the NITID method: find new business opportunities that might arise from data.

Commonly, in a creative process, the first step is brainstorming. By putting all the ideas on the table without any kind of criticism, judgments and filters, here below a list of new business opportunities that a brainstorming session applied to the Tripadvisor case might generate:

1) Facilitate the process of the reviews for users by updating a list of “pending reviews” to fill once a new bill in a restaurant\hotel has been recorded. In such a way the user, when log in to TripAdvisor’s website, doesn’t need to search for the restaurateur to be reviewed since a pending review connected to the restaurant\hotel is available  Furthermore, the number of total reviews will increase since the review process has been simplified for customers.

2) Create “customer experiences” through new visualization charts such as a map of visited restaurants and hotels and\or a social network that connect users together in order to share the experiences.

3) Engage customers by creating synergies with loyalty programs and companies (e.g.: Nectar) and provide gifts to customers who deliver more reviews.

4) Provide statistics and reports that might be useful to restaurateurs and hotel managers: trends, demand forecast, seasonality, sentiment,….

5) Establish an integrated supply chain by providing further additional services to restaurateurs and hotels. In particular, the demand forecasts should be shared with restaurateurs and hotels’ suppliers by recording all the food\goods consumed by linking them with the receipt. For example, a week in a room requires three units of soap or for cooking a steak in a restaurant are needed 100 grams of meat plus 1 mg of salt and 5 grams of olive oil. By using this data it’s possible to establish a logistic platform that might provide a competitive advantage both for buyer (restaurateurs and hotels) and suppliers. In particular, buyers, and especially small entrepreneurs that cannot invest and maintain complex IT infrastructures, might improve theirs inventory turnovers by having a more granular and detailed consumption of material. Meanwhile, local suppliers might have additional information regarding consumptions and level of inventories of theirs clients and thus enable more frequent on time deliveries and\or with a small amount. Such a solution might be useful for enabling an advanced Demand Driven Supply Chain (DDSC). EBay’s already told us with its “same day delivery” business model where small retailers have became a network of a distribuited inventory (see: “EBay expands same-day delivery in local battle with Amazon“).

Maybe, or better for sure, there are many and many issues regarding those new business opportunities:

Why changing and expanding the business model of Tripadvisor beyond core activities?

Why to invest in new relations, IT infrastructure, and skills?

What about the issue of data privacy?

Anyhow, making questions, having doubts and putting barriers are not allowed when brainstorming.

As when dreaming:

Logic will get you from A to B. Imagination will take you everywhere (Albert Einstein).

Feelink – Feel & Think approach for doing life!

New IT Innovation Development (NITID) method: Tripadvisor Case Study


NITID-Tripadvisor

How to fight Negative SEO tactics? Think about the case of Tripadvisor and imagine a business model as below:

1) eat a meal in the restaurant (e.g.: “La bella vita”) pay the receipt with a User ID Card (e.g.: loyalty\member card).

2) Then the consumption will be sent and registered in a TripAdvisor data base as “consumption to be reviewed”. That could be nowadays even easier than 10 years ago if you since the technology available such as card reader, smartphones, apps, are cheap and well-known by end users

3) You go home and since you have enjoyed the delicious spaghetti at “La bella vita” you decide to post a review in Tripadvisor. Since there is a consumption associated to you, your review will be validated and thus not consider as Positive\Negative SEO tactic.

4) The competition around “La bella vita” is challenging and the main competitor, “The Beagle Boys’s Pizza”, pretty tough. “The Beagle Boys” is highly pushing a Negative SEO tactic and they usually attempt to write bad reviews against “La bella Vita”. Unfortunately, since no consumption is pending as “to be reviewed”, the comment in Tripadvisor will be not considers as valid.

Well, such a business model might fix definitely the issue of Negative SEO for Tripadvisor and make their service much more useful for consumers…

…but, is that really all about implementing such a business model?

I mean, how is possible to fully exploit the investments needed for developing a new IT infrastructure?

Well, new data is actually now available for Tripadvisor since many consumptions are tracked. In particular, three key aspects has been registered:

1) WHAT (spaghetti)

2) WHO (user ID)

3) WHERE (GEO position of the restaurant)

That is actually what a BigData initiative is: leveraging the data available inside as well as outside the company not only for improving the core business but also for developing new ones.

How? By using a N.IT.I.D method: New IT Initiative Development.

Coming soon.

Feelink – Feel & Think approach for doing life!

New IT Innovation Development (N.IT.I.D.): a new business model generator at a glance


NITID Process

Once understood the second side of technology: technology as a catalyst to change business models

(see also: Firm Infrastructure Vs Catalyst to Change Business Models (part 2): New IT Innovation Development (NITID))

  • How to develop new business models that anticipate customers’ needs and market’s trends?
  • How to make IT innovation fully sustainable also by using all the data (inside & outside the company)?
  • How to manage technology disruptions?

Here a “N.IT.I.D.” tool to address such an issue of nowadays businesses of whatever industry.

5 steps:

1. Brainstorming (lateral thinking):

Ok, a new technology or improvement has come out… which might be impacts on the business and society? How can be used for market effectiveness?…in other words, what to do? Starting by thinking to a solution is the best way for achieving a failure.  In a good brainstorming stage all the business impacts related to customers’ needs and stakeholders should be written down without any kind of criticisms. A good brainstorming stage rely on people with different mindsets, lateral thinking and should generate as much options as possible. In one world: chaos

(see also: Chaos vs. Determinism: why not both? From evolutionary theory to BIG Data challenge)

2. Simplify (vertical thinking):

A list of ideas that might have no sense (apparently!!!) has been written down. It’s time to make order upon the chaoby giving to each idea a title. An image that simplify the idea in one #hashtag. Then, remove all the ideas that are redundant because the have the same image, title or #hashtag.

Then, rank all ideas (e.g.: team members votes) and eliminate the ones less relevant. For example, keep only 30 ideas out of 200\500 initially generated.

3. Organize (vertical thinking):

With a simplified list:

  1. first level groups: unify the remaining ideas into rational association (criteria) affinity groups
  2. rank the groups. (e.g.: each member of teamwork assigns 1,3 or 6 point for each group of ideas)
  3. second level groups: group again the unified ideas into a rational association affinity group (another criteria)
  4. for each second level group, summarize a general topic (avoid a list of ideas) or a common theme.
  5. identify relations among groups (correlations, dependencies).

4. Evaluate Solutions (lateral & vertical thinking):

Now it’s time to think about a solution: how to develop a solution that meets the needs and opportunities that has been previously brainstormed, simplified and organized?

Many solutions should be brainstormed again and evaluated according to a list of “key performances” that are needed for implementing the new functionalities (needs).

That’s more likely the most challenging stage since both lateral and vertical thinking are required for generating new solutions and for evaluating them according to the key performances required from customers.

5. Select Solution (vertical thinking):

A list of selected solutions and possible business models that are possible thanks to IT innovations and technology improvements are now available with an evaluation that is linked with key performances. How to select the only one that is sustainable and worth to develop?

That is the final Selection stage where each solution is compared and assessed against accordingly what is already provided by competitors.

An example of how N.IT.I.D. process might be helpful in order to find opportunities and threats (disruptions) from IT and technology innovations?

Recalling the issues of Negative SEO:

(see also: Tripadvisor: a case study to think why bigdata variety matters)

…how to improve a service like the one of TripAdvisor closer to customers’ needs?

…stay tuned ;)!

Feelink – Feel & Think approach for doing life!

A question about IT change management: does the DNA of the company fit your IT vendor?


Company_Vendor_DNAs

When delivering my final dissertation of the MBA program (here the link of a short presentation), along the research I’ve encountered the topic of IT Change Management.

As a matter of fact, whenever a company decides to implement IT innovations most likely new collaborations or partnerships with IT Vendors, consultants or third parties are needed. Usually, within a selection process, IT suppliers are evaluated accordingly to theirs know how and proven expertise. However, what about other aspects such as the agility to change, the ability to innovate and corporates’ cultures? Is there a potential fit or a misfit between the company and the selected IT vendor?

The company’s DNA

In order to avoid failures, it’s fundamental to set a pace for IT innovations that is affordable to the company according to its DNA. According to R. Ray Wang (@rwang0) there are two kind of attitudes when defining a DNA of a company: proactive vs. reactive and incremental vs transformational attitudes.

Cautious Adopters: proactive & incremental (about 30%). Such companies are looking for new technologies without waiting what other competitors do. However, they are willing to implement only the technologies that might play a key role in the future as well as they are not keen to consider the opportunity to change their business model even if the new technology enable a breakthrough.

Market Leaders proactive & transformational (about 5%). A market leader has the ability to sustain high paces of IT innovations as well as an organizational flexibility to change also its business model.

Laggards: reactive & incremental (30%). Such a company avoid any kind of risk of a self-disruptive innovation and integrates new technology only when other competitor succeed. In any case, without transforming its business model.

Fast Followers: reactive & transformational (15%). This of kind of DNA is able to mitigate the risk of adopting new technology by relying on the ability to change quickly the business model and the organization as a way to survive against disruptive innovation threats.

(More: “The Building Blocks of Successful Corporate IT“, HBR Blog)

IT Vendor’s DNA

What about the DNA of an IT Vendor? Gartner is well-known for providing a “magic” quadrant for everything and also for evaluating an IT vendor: completeness of vision and ability to change are the two main attitudes to consider.

Leaders: high completeness of vision & high ability to execute. As IT vendors, they are able not only to provide innovative services that works today but also to influence the market that theirs innovations are the best for the future. For these reason, such IT vendors might fit best a company with a leadership that wants to invest in new infrastructures\technology early and avoiding any risk due to technology (obsolescence, maintenance, etc.). However, also a cautious adopter (DNA) company that wants to develop a leader DNA should prefer IT leaders by relying on their ability to execute and play a key role as an influencer within a change management process.

Niche Players: low completeness of vision & low ability to execute. Is the case of IT vendors specialized in few functionalities and with low ability to execute due, for example, to a lack of resources (financial, operating) and power (network). However, such IT vendors might be useful for companies that need small technology changes without stringent delivery deadlines. For these reason IT niche players might be extremely useful for Laggard (DNA) companies.

Visionaries: high completeness of vision & low ability to execute. Is the kind of IT vendor that fit best a Cautious Adopter company’s DNA. Anyhow,  a Fast Follower (DNA) company that wants to innovate proactively rather than reactively, might get some useful insights from Visionaries third parties.

Challengers: low completeness of vision & high ability to execute. Is what Fast Follower companies usually need. However, a Cautious Adopter company that wants to improve its change management process should look for Challengers as IT vendors.

(More: “How Gartner Evaluates Vendors and Markets in Magic Quadrants and MarketScopes“, Gartner)

So, which IT Vendor to chose? Thinking about possible threats due to cultural and organizational divergences between the company and th IT vendor DNAs will ensure the implementation of the strategy as well as it will avoid market\operational risks and a waste of resources: why to invest on IT Vendor Leaders? Does the company really need it?

As a moral of this story, selecting the IT Vendors that fit best the company DNA is not so different as chosing relationships and friends in our every day life. Trusted and better relationships are guaranteed only by knowing ourselves as well as the others.

Feelink – Feel & Think approach for doing life!

Firm Infrastructure Vs Catalyst to Change Business Models (part 2): New IT Innovation Development (NITID)


Value chain

Acknowledged the role of IT and technology as a catalyst to change business model (see the previous post “Firm Infrastructure Vs Catalyst to Change Business Models:  the Double Side of IT“), how to implement new IT innovations in practice?

Each innovation implies a changing process and each changing process implies commitment and investments…so, which IT innovations to choose in order to avoid a waste of resources? Are the IT innovations under development in line with the customer needs (actual or potential)? Which are the key competences needed for developing a new IT innovation?

Whatever the industry of the company is about, since the focus is customers’ needs, why not thinking how to adapt the NPD (New Product Development) process to IT innovation? The NPD is a structured creativity process focused on introducing new kind of products\services that effectively produces innovations.

In particular, the NPD process combines lateral (generations of ideas) and vertical thinking (selections of ideas) together and it is divided into four stages: ideas brainstorming, ideas classifications, ideas evaluation and ideas selection.

NPD stage 1: ideas brainstorming (lateral thinking)

In this stage all the team members engaged simply write down new ideas without any kind of filter or criticism (lateral thinking). Taking as an example the case of TripAdvisor (see “Tripadvisor: a case study to think why bigdata variety matters“) where a validation process of the reviews is in place by recording on a database the receipts of the end-user at the restaurant: which might be the new innovations available by using the data of the receipts?

NPD stage 2: ideas classification (vertical thinking) – KJ Method

Now, since usually a brainstorming session generate chaos, how to figure out which IT innovations to implement?

Like navigating in the middle of a storm, just stay focus on the ongoing  issues, do not think to a final solution and keep clam. So a first step is to organized ideas in a structure way in order to figure out a big picture. An approach for classifying the brainstormed ideas is the KJ method, where all the initiatives are split into groups by using a criteria. For example, criteria for classifying IT innovations could be: which are the departments\functions involved by the IT innovation? Or\And, which are the stakeholders (customer, suppliers, third parties,…) involved?

Then, for each group of ideas, assign a tag that identifies it. For example, suppliers IT innovation, marketing & sales IT innovations, and so on.

NPD stage 3: ideas evaluation (vertical thinking) – QFD Matrix

Once ideas are grouped and tagged, the next step is to identify the key performances that are needed in order to implement new IT initiatives. Typically, regarding IT stuff, they are about DataBase (storage, number of transactions,…), architectures, maintenance costs, usability, interoperability,…

By putting IT initiatives into rows and the key IT characteristics into columns, the finial result is a matrix called QFD (Quality Function Development). Briefly, the QFD matrix connects the IT initiative with the needed performances. For these reasons, the QFD matrix applied to IT innovations might be useful also for procurement: which are the key competences? Make or Buy? If buy, which IT vendor to choose?

NPD stage 4: ideas selection (vertical thinking) – Pugh Matrix

Just for a recap. We have organized the ideas, we have identified the key characteristics for each IT initiative… and so? Which IT initiative to implement? The answer is provided by the so called Pugh Matrix where, for the development of a new product or service, evaluates ideas and solutions according to a gap analysis. In particular, how much the new idea will be valuable for the customer? Will the new idea provide a competitive advantage against competitors?

A similar evaluation should be adopted also for IT innovation. Why? Just think about the risks correlated when IT becomes so complex to be maintained and thus a nightmare for customers, employees and suppliers as well.

Too much enthusiasm on IT initiatives has a side effect to much IT complexity. How to innovate without adding superfluous IT complexity? What about using NITID (New IT Initiative Development), a revised NPD method widely use for product innovations?

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Firm Infrastructure Vs Catalyst to Change Business Models: the Double Side of IT (Change Management)


 Value chain_0

Technology improvements, such as mobile devices with embedded GPS, RFID, WiFi receivers that are becoming cheaper and cheaper, are enabling new business opportunities as well as new threats arising from disruptive innovations.

Few weeks ago I saw a video from MIT Sloan “Video: What Digital Transformation Means for Business.“. A meaningful and for me inspirational chat with Kim Stevenson (Intel Corporation, @Kimsstevenson), Mark Norman (Zipcar), Didier Bonnet (Capgemini Consulting) and Andrew McAfee (MIT Center for Digital Business, @amcafee) about how technology and IT are nowadays impacting businesses. Booking a flight and see its status in real-time or check the bank account are nowadays common consumer habits thanks smartphones and apps, while few years ago that was something beyond imagination.

IT is a catalyst to change business models

If I have to chose a slogan that summarize the video from MIT, I would pick up the words “Nowadays IT is a catalyst to change business models” (by Kim Stevenson and Andrew McAfee). Many cases have shown how technology impacts business by redefining how  services\products are delivered to customers.

Side 1 of IT: process automation

Anyhow, what is IT for a company nowadays? According to the value chain model (see Figure), IT is firstly part of the firm’s infrastructure. When IT plays this role, the objective is to automate standardized processes that are in place within a fixed business model. For example, Operation Support Systems (OSSs) to support operation and inbound\outbound logistic, Customer Relationship Management (CRM) or other administrative functions such as managing payrolls (HRM).

Since the business model is fixed and procedure standardized, when IT is consider as part of the infrastructure, technology advancements might create new opportunities for improving efficiency: do the same with less. For example, new cheaper hard disks and CPUs available in the market that means opportunities to store\process more data.

Side 2 of IT: customer needs and value creation

However, what happen when IT plays the role of a catalyst to change business models? In this case technology advancements might open new approaches for delivering the product\service to customers or even generate completely new customer’s needs. Can you imagine your life now without a WiFi connection? (see a revised version of Maslow’s pyramid model). WiFi connection plus cheaper smart phones are a meaningful examples about how technology might change business models and re-define customer’s needs as well.

Anyhow, generating new needs and changing business model also implies operating with not standardized procedures.

Standardization Vs Innovation: How to manage the double side of IT?

Thus, how to manage together the two opposite sides of IT? One side that standardize procedures and the other that defines new ones?

Moreover, how to bring only IT innovations that really generate value to customers? How to identify the key competencies and resources that are needed as input for the new business model?

In the video of MIT Sloan Leadership skills and M&As might help organizations to handle impacts coming from new technology advancements in order to acquire key competencies as well as avoiding disruptive innovations threats.

Best practices apart, is there a framework that brings together all the aspects of change management also for IT? I mean, is it possible to evaluate customers’ needs, key resources\copetencies, value creations and strategy threats\opportunities as a whole? Moreover, how to control the IT complexity by focusing only on new IT initiatives that really matter?

Big challenges for IT change management, especially considering that nowadays technology breakthroughs are faster and more impacting than in the past.