1. Ethnographic OpportunityAnalysis part 1 (Spring 2013) Hank Delcore & Jim Mullooly aka TheAnthroGuys @ www.TheAnthroGuys.com 1

2. io n? v atIn noInnovation is not the product of logicalthought, even though the final product istied to a logical structure - AlbertEinstein 2

3. Innovation in Business (Schumpeter, 1934) 1. Introduction of a new/improved good 2. Introduction of a new method of production 3. Opening new market or territory 4. Conquest of a new source of raw materials 5. New type of organization 3

4. Innovation in Business (Schumpeter, 1934) 1. Introduction of a new/improved good Sweet Chocolate 4

5. Innovation in Business (Schumpeter, 1934) Henry Fords 2. Introduction Assembly Lineof a new methodof production 5

6. Innovation in Business (Schumpeter, 1934) Shushi in US3. Opening newmarket or territory 6

7. Innovation in Business (Schumpeter, 1934) Sugar Beets in 1870s 4. Conquest of a newsource of raw materials 7

8. Innovation in Business (Schumpeter, 1934) Japanese AutomotiveAdministration 5. New type of organization 8

9. Innovation in Business (Schumpeter, 1934) 1. Introduction of a new/improved good Sweet Chocolate 9

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14. Steve Jobs Master of Innovation asimprovement of an existing good 14

15. How PersonalComputerswere Used (1984) 15

16. How Music deviceswere Used (2001) 16

17. How Smart Phoneswere Used (2007) 17

18. How TabletComputerswere Used (2010) 18

19. BUT Apple is a Software Company(Steve Jobs) 19

20. Apple is a Software Company (Jobs) The Macintosh Interface 20

21. Apple is a Software Company (Jobs) The Ipods Itunes Store 21

22. Apple is a Software Company (Jobs) The Iphones App Store 22

23. Apple is a Software Company(Jobs) The Ipads App Store 23

24. How can youfind theseopportunities? 24

25. Through t io n d u cIn 25

26. Ethnographic (Inductive) Opportunity Analysis Deductive Approaches Hypothesis Data Collection Analysis from general to specific Inductive Approaches Data Collection Analysis Hypothesis 26 from specific to general

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29. Engineering vs. Reverse Engineering 29

30. Inspirational Induction Analytic Induction Work Workaround Engineer Reverse Engineer 30

31. "The ability to observe consumersin context, without preconceptions,and then deliver a market-worthyinnovation." Good, simple (i.e. biz-friendly) def. of "analyticinduction"? 31

32. AnthroGuy HimselfProfessor Hank Delcore 32

33. CASE 1: Dirty LaundryWhat do you dowith dirty clothes? 33

34. Proctor & People doing ObservedGamble laundry 34

35. Found 35

36. CASE 2: Energy CrisisHow can yousave energy? 36

37. Intel Observed Green Homeowners as Lead Adopters as Lead Adopters 37

38. Found 38

39. CASE3 39

40. All of these casesillustrate one overarching observation: 40

41. What People SayThey Doand What They DoAre Different 41

42. The Business Case for User-Driven Innovation Unprecedented specialization and segmentation, multiplied many times over by domestic and international cultural diversity. 42

43. The Value of the Use Case Entrepreneurs can neither assume that they are socially or culturally close to users nor that they can keep up with consumer trends themselves unless they seek user-centered insights. 43

44. Increased Competition Increased competition from emerging economies Companies can no longer rely on the advantages of being the first to introduce new technologies to the market. 44

45. Democratization ofKnowledge The democratization of knowledge, driven by the internet and information technology in general Armed with lots of information and the ability to buy from companies all over the globe, consumers no longer consider the price/quality trade-off as the sole driver of choice. 45

46. Democratization ofKnowledge Instead, consumers increasingly consider how a company and its products match their own personal values, behaviors and needs. To get at this, successful companies must include users in the innovation process. 46

47. Just to Stay Solvent As Squires and Byrne put it: companies have to manufacture the right commodities and deliver them in the right way to the right consumers at least four out of ten times every year just to stay solvent (Squires and Byrne 2002:xiv). 47

48. Traditional R&D departments and entrepreneurs with their own views on what people want can no longer keep up with the reality of rapidly evolving needs and desires. 48

49. THE ASSIGNMENT Pll P ea ea se If I have ever made any se Pa Pa valuable discoveries, it y yA Att has been owing more tte enntti ion on to patient attention, !!!!!! than any other talent. Isaac Newton: (1642-1727) 49

50. THE ASSIGNMENT 1) Conduct some sort of inductive observation, 2) analyze your notes, then 3) expand those notes into a brief report about what you found. 50

51. DESCRIPTION Rather than looking into a completely innovative idea (service or product), the goal is to 1) observe something that already works; 2) observe it in great detail; then 3) begin to understand it in such detail that you can 4) make concrete suggestions about improving it. 51

52. In Other Words Rather than looking for how consumers COULD use a NEW service/product, the goal is to observe how consumers DO use a EXISTING service/product with the intention of looking for opportunities to improve or add value to that experience. 52

53. Steps 1. Find a routine, taken-for-granted task/service/product, 2. Hang out and thickly describe it in a notebook, 3. In a one page pitch, suggest some sort of innovation that will add value. DUE: next Wednesday by 3:00pm in class. The best observations will be published on our blog and presented in class on the Wednesday after that. 5353

54. Ethnographic OpportunityAnalysis part 1 Hank Delcore & Jim Mullooly aka TheAnthroGuys @ www.TheAnthroGuys.com Thanks for your Time 54

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