innovation

l e a nsoftware development

www.poppendieck.comMary [email protected]@poppendieck.com

The Fastest Learner WinsLiving with Black Swans

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Agenda

1. Compelling OfferObserving

2. Immediate ConnectionQuestioning

3. Adoption ChainNetworking

4. Validated AssumptionsExperimenting

August 12 Copyright©2012 Poppendieck.LLC2

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Todd ParkHarvard Graduate (Economics)Booz Allen Hamilton Consultant (Managed Care)Athenahealth (1997)

Maternity Clinic Health Care Records Very successful IPO

Retirement (2007)US Health and Human

Services CTO (2009)

US Federal Government CTO (2012)August 12 Copyright©2012 Poppendieck.LLC3

Artist Regina Holliday

2010

2011

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Agenda






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Strategic Inflection Point


Business goes on to new heights

Business declines

10x change in some element of the business.

What worked before doesn’t work now.

The executives are the last to know.

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Compelling Offer

10X Improvement in some aspect of the offerSalesforce.com

SaaS gave a 10X reduction in installation and operating costsSkype

Peer-to-peer IP telephony for a 10X reduction in long distance chargesWikipedia

Open source collaboration for a 10X increase in the speed and a 100X reduction in cost for encyclopedia development and maintenance

Dropbox 10X improvement in ease of use and safety for those who wanted to keep

multiple devices in sync.YouTube

Cell phones gave a 10X improvement in capability to take casual videos, YouTube gave a 10X improvement in ease of sharing those videos.

August 12 Copyright©2012 Poppendieck.LLC6See also: http://ecorner.stanford.edu/authorMaterialInfo.html?mid=2732

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Working Backward

1. Write a Press Release

2. Write a list of FAQ’s(and answers)

3. Describe the Customer Experience

4. Write a User Manual.


PRESS RELEASEHeading –

Name the product in a way the reader (i.e. your target customers) will understand.

Sub-Heading –Describe who the market for the product is and what benefit they get. One sentence only underneath the title.

Summary –Give a summary of the product and the benefit. Assume the reader will not read anything else so make this good.

Problem -Describe the problem your product solves.

Solution –Describe how your product elegantly solves the problem.

Quote from You –A quote from a spokesperson in your company.

How to Get Started –Describe how easy it is to get started.

Customer Quote –Provide a quote from a hypothetical customer that describes how they experienced the benefit.

Closing and Call to Action –Wrap it up; give pointers where the reader should go next.

Working Backward

http://www.allthingsdistributed.com/2006/11/working_backwards.html

http://www.quora.com/What-is-Amazons-approach-to-product-development-and-product-management

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Exercise: Write a Press Release

Working as a group, write a press release for a product real or imaginary.


PRESS RELEASETitle –Central theme (Tag line) –Summary (10X effect) –Problem –Solution –Getting Started –Call to Action –

1. Aim the press release at consumers of the product.

2. Create a tag line to quickly summarize the central theme.

3. Summarize the offer in terms of its10X effect.

4. Center your message on a single theme that will define what the product is and is not.

Innovation Skill: Observing

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Agenda






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Total Cycle Time

Release Cycle6 Months

Quick & Dirty Value Stream Map:


Release CycleRelease Cycle

HardenDesign UATDevelopNeed aFeature

Release Cycle

Total Cycle TimeValue-Added Time

Average Start EndStart

Need a Feature

Development Model: Releases are very painful Avoid releases!

Thanks to Kent Beck for his ideas on cadence.

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Release CycleQuarterly

Hardening: 2 – 4 weeks Early integration testing becomes essential Typically: 2 – 4 week iterations Code from each iteration goes to integration testing


Business issues (if software is sold/delivered to customers):

How to price and sell releases? Which releases to support?

Supporting multiple branches can create a support nightmare

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Release CycleMonthly

Now you need:Hardening 3 daysCross Functional Team VisualizationShort Daily MeetingsSBE/TDD really working!

Works best for:Software as a Service (SaaS)

[Any download to local machines is pushed.]

Internal SoftwareAugust 12 Copyright©2012 Poppendieck.LLC12

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Release CycleWeekly/Daily/Continuous

Kanban works well Iterations become irrelevantEstimating is not very importantNo branching – Develop on the trunkTest & deployment automation is essentialRapid cycles of learning drive portfolio decisions


Things. Just. Work. One or our large web-based customers

has been deploying daily for five years! Google: gmail deploys 2X/week What is the fastest release cycle here?

The team is everyone.

l e a nBent’s Guiding Principle:

Creators need an immediate connection with what they create.

Immediate Connection


Bent VictorInventing on Principle

http://vimeo.com/36579366

Bret Victor invents tools that enable people to understand and create. He has designed experimental UI concepts at Apple, interactive data graphics for Al Gore, and musical instruments at Alesis.

OurGuiding Principle:

People should not be told what to do.

Combining Principles:Teams should adjust what they are doing based on

what team members learn directly from their efforts.

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Exercise: Draw aFeedback Matrix


I adjust what I do based on:

Indirect informationabout consumers

Direct connection with consumers

Del

ayed

in

fo a

bout

res

ults

Imm

edia

te

visi

bilit

y of

res

ults

1. Have everyone at the table plot a point for a typical development team members.

2. Add additional points for members from different functions.

3. Plot the ideal point for team members working on that compelling offer.

Innovation Skill: Questioning

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Agenda






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The Age of the Platform


Platform(infrastructure and rules)

Contributor Consumer

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Adoption Chain

Innovators often forget Complementors!


Run-flat tiresHonda Odyssey 2005

The first e-reader2006

The first 3G Phone2002

The first MP3 Player1998

Books?3G Networks?Music? Repair?

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Cost vs. Relative Benefit

Adopters see value differently.


If any organization on the adoption chain perceives a negative value, the adoption chain is broken.

NewProductBenefit

ProductCost

Innovator’s Perspective

NewProductBenefit

Product Cost+ Additional Costs/Risks

Old ProductBenefit

RelativeBenefit

Adopter’s Perspective

The Wide Lens, by Ron Adner

Innovator

Distributor

Retailer

Consumer

+ + + +

+ + +

+ + + + +

-

This adoption chain will not work!

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Exercise: Evaluate the Adoption Chain


Party 1

Party 2

Party 3

Party 4

+ + + +

+

+ + + + +

-

Adoption Chain

Innovation Skill: NetworkingYou would like to develop a product with compelling value and provide immediate connection between the product creators and consumers. In order to achieve this, you need the cooperation of organizations within and outside of you company that are not part of your immediate team.1. Make a list of the parties who must change the way they

do things in order for the improvement to be successful.2. Look at the benefits to be gained and the cost of change

from the perspective of each party.3. Are there parties where the cost outweighs the benefit? 4. What can be done to change the equation so the benefits

are greater than the cost for that party?

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Agenda






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Validated Assumptions

Validated Assumptions:1. List assumptions that must be true in order for the product to succeed.

a) Which ones are most important?2. Devise experiments to determine whether critical assumptions are true.

a) Create a measurable hypotheses that will demonstrate clear cause and effect.b) Run many, quick experiments to test the hypotheses.

Lean Startup:1. Start with a Business Success Model

a) Success metrics which demonstrate clear cause and effect.2. Establish a baseline – with a Minimum Viable Product3. Target every initiative at improving a success metric4. Do not add capabilities without validation (eg. split test)


Only a few large companies have been able to sustain growth over time by coming up with successful new disruptive businesses. These companies share a common practice: They have systems in place that encourage small, cross-functional employee teams to conduct frugal experiments. Scott Cook, Intuit

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Experimental Approach

August 12 Copyrignt©2011 Poppendieck.LLC23

Site visitors are randomly assigned to see version A or BA B

B is better than A14.5% Conversion 18.6% Conversion

1. Most of the time the guess about how customers will behave will be wrong – even for experts!

2. Test early – don’t waste a lot of time on in-depth analysis or planning the perfect design.

3. Test often – most experiments don’t tell much. 4. A failed experiment is not a failure – it’s a

learning opportunity. The only failures are failure to learn or failing to conduct a good experiment.

Don’t Miss this excellent paper:

http://exp-platform.com/expMicrosoft.aspx

Online Experimentation at Microsoftby Kohavi , Crook, & Longbotham

Presented at KDD 2009(Knowledge Discovery & Data Mining)

Amazon.com Case StudyAmazon’s Greg Linden created a prototype which gave personalized recommendations based on items in the shopping cart. The feature was opposed by a marketing SVP who told Greg to stop, but Greg created a test anyway. He was allowed to pushed it live. The feature ‘won’ by such a wide margin that it was immediately adopted, increasing sales by an estimated 3%.

http://glinden.blogspot.com/2006/04/early-amazon-shopping-cart.html

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How?

Who?

Why?

How?

What? What?

Who?

Impact Maps

Why?Who?How?What?

Connections=Assumptions


Images and ideas from:Impact Mapping Handbook

by Gojko Adzic – Available soonCheck out:www.impactmapping.org

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Exercise: Find and Validate Assumptions


Innovation Skill: ExperimentingValidate assumptions for your compelling offer.1. Draw an Impact Map.

a) Start with the goal – make it measurable.b) Who needs to be involved?c) How will they contribute?d) What needs to be done to support each contribution?

2. List the assumptions connect each node on the map.3. Prioritize the assumptions; select the top two.4. How will you measure these two assumptions?5. Devise an experiment to validate each assumption.

Impact Map

Why?Who?How?What?Assump-

tions?

l e a nsoftware development

www.poppendieck.comMary [email protected]@poppendieck.com

Thank You!More Information: www.poppendieck.com

innovation

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n us federal government