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.
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
A list of ideas that might have no sense (apparently!!!) has been written down. It’s time to make order upon the chaos by 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:
first level groups: unify the remaining ideas into rational association (criteria) affinity groups
rank the groups. (e.g.: each member of teamwork assigns 1,3 or 6 point for each group of ideas)
second level groups: group again the unified ideas into a rational association affinity group (another criteria)
for each second level group, summarize a general topic (avoid a list of ideas) or a common theme.
identify relations among groups (correlations, dependencies).
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?
How was the Universe created? It was generated by chance or it was created with a specific purpose?
Chaos vs. Determinism is one of the toughest issue to address for philosophers and it has been debated since the age of the ancient Greece.
Is the world nowadays governed by chaos or determinism? Hard to say, but what I notice is that sometimes Chaos and Determinism together might create an outstanding synergy. When? Here there are at least four examples: the Evolutionary Theory, the New Product Design process, the Lateral & Vertical thinking and the challenge of Big Data with Social Media.
1. Evolutionary theory
The Darwin’s evolutionary theory is undoubtedly the most meaningful example of how chaos and determinism can work very well together…otherwise we couldn’t be here to discuss how this world works!
Since also Mother Nature cannot foreseen what will happen in the future, how is it possible to survive? By generating continuosly chaotic genetic mutation in the DNA a thus create a large variety of species: simple and brilliant! The generation of new alternatives, through DNA mutations, happens also when the environment is not changing because such variety of species will more likely guarantee the life in our planet Earth if a big change occurs.
Just think what happened 65milion years ago with the extinction of Dinosaurs. The impact of a big asteroid changed radically the climate and the T-Rex, together with his big friends, wasn’t able to adapt to the new environment condition. What happened is that a new family of species more adaptable escape from the extinction: mammals.
Mother Earth is not efficient like human being tends and likes to be. She is effective, likes redundancy and varieties in order to let the life carry on. How many times financial advisors said? “Diversification! That is the way to mitigate the risk of market’s volatility and uncertainty”. Either they consciously know the evolutionary theory or they are survivors from the natural selection.
2. New Product Design
Another example is taken from the business world. Words like innovation, internationalization, diversification, mass-customization, not only have inspired the famous “business lingo bingo” game in order to stay awake during a work meeting, but also they have in common the same objective: continuously create new products. A company that doesn’t invest on the development of new product, in order to fill the customer needs that change through time or to reach\establish new market, is doomed to die.
Anyway, a new product is the result of a process: the New Product Design (NPD).Well, such process is divided into many different stages. Briefly, at the beginning there is brainstorming phase in which are collected all the new ideas in terms of needs without thinking if a new idea makes sense or is not feasible. For example, thinking about a new umbrella: “I want to use an umbrella like a parachute!” Why not? …ok, probably using an umbrella as a parachute is not practicable. So, how to organize and select all the ideas that came out from a chaotic brainstorming? A solution is the so called KJ method invented by Kawakita Jiro. It’s a process that organize, prioritize and select all the needs that really matters in a structured way. Probably also a parachute umbrella, is needed who knows!
Once the needs have been classified, the NPD process analyzes systematically all the needs related to the features required by the new product through the QFD (Quality Function Development) and the Pugh matrix. As a result, there is one or a couple of new solutions that are feasible and that fit all the significant needs. Just in case, if doesn’t cost so much effort, also others additional needs like “parachute umbrella” might be added in the new product in order to be “different” in the market.
Now, considering the brainstorming as a genetic mutations and the KJ\Pugh matrix as a natural selection, does the NPD process is like the evolutionary theory applied to products?
3. Lateral vs. Vertical thinking
Considering again the example of the umbrella parachute, it came out during the brainstorming phase without thinking if it would be feasible or not, while during the NPD process it might be more likely eliminated due to many technical as well as reasonable limitations: is there someone that really need a parachute umbrella?
This is the first distinction that Edward de Bono, the inventor of the lateral thinking, suggets between the Lateral and the Vertical thinking. Respectively, one is productive while the other is selective. Not only, Edward de Bono defines many others adjectives that characterized the vertical and lateral thinking as follow:
Lateral thinking: productive, stimulating, discontinuous, incoherent, do not use negations, open to intuitions, unspecific, less probable, open\probabilistic process.
Vertical thinking: selective, analytical, continuous, coherent, use negations, relevance focused, specific, more probable, close\deterministic process.
According to the adjectives mentioned above the aim of the lateral thinking is to find new solutions\ideas in an incoherent and chaotic way in order see the things from different perspective. On the contrary the vertical thinking select the intuitions in a structure way in order to develop a new coherent model. That’s what happened to the father of Quantum Theory Max Planck.
At the beginning ,when he got the intuition to assume that the energy of the particles can change only in discrete amounts, no less that the so called Planck constant, Max Planck was extremely skeptical because such assumption was not coherent with classical physic. Than many others brilliant minds such Bohr, Heisenberg, de Broglie, Einstein, Schrödinger, Pauli and others demonstrated that the assumption of Plank works with physical phenomena at microscopic scales. A new physic model was born thanks to a winning combination between the lateral and vertical thinking: the Quantum Mechanics.
Social Media phenomenon is undoubtedly having significant impacts in the way the people communicate and interact as well as the businesses operate. Some decades ago the main trouble was how gathering the needed information while nowadays it’s the opposite: which information is really relevant? The Big Data is going to address this issue, in order to organize, classify and select the relevant information that is generated almost randomly by billions of sources, me included, in the world. Why the information is generate randomly? Well, the Big Data issue is going to be addressed from the technical point of view and many tangible results has been achieved. Think about the mass-customized advertisement and NPD (new product design, see above).
However, Big Data is not only a question of technology. Also the human factor is interested since the information technology and social media might amplify an irrational behavior of groups by creating the so called Social Object’s effect. Retweets call likes, likes call posts and posts calls retweets again into spiral loop. In fact, as Tom Dickson showed: “It blends!”
Anyway, why the social object might stimulate an irrational behavior? Prof. Vincent F. Hendricks from the University of Copenhagen underline the fact that the online discussion take place in a kind of echo chambers: “In group polarization, which is well-documented by social psychologists, an entire group may shift to a more radical viewpoint after a discussion even though the individual group members did not subscribe to this view prior to the discussion” (see Information technology amplifies irrational group behavior). That is because the human behaviuor is highly influenced by the group.
The influence of the grpup is one aspect. Than, when I discovered that a social object in Twitter or Facebook reaches its peak of influence only after two hours and then it rapidly declines I realized that also the time factor might force to an irrational behaviour. If you want to follow the peaks you must react quickly, and when a quick reaction is required the human brain rely to the amygdala by asking: flight or fight?
The amygdala is switched on whenever a dangerous or a stressful situation occurs. The amygdala, since activates quick reactions, saved humans (and other species like rabbits!) from extinction when thousands and thousands of years ago the human being were struggling against predators every day. Fortunately a social object doesn’t hurt like a saber-toothed tiger so there is no risk to die physically, possibly only digitally.
Anyway, in order to fully exploit the chaos generated by the social media, dealing amygdala might be useful in order to navigate rather than drifting in the digital see. So feel, think and than just in case post, tweet and like.
Chaos and Determinism: inseparable twin brothers of knowledge!