quantifying risk for innovation teams...team cross-functional — product, design, engineering...

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Quantifying Risk For Innovation Teams Sam McAfee — Neo Innovation @sammcafee

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Page 1: Quantifying Risk For Innovation Teams...Team Cross-functional — Product, Design, Engineering Co-located and dedicated to the project Agile experience, and reading The Lean Startup

Quantifying Risk For Innovation Teams

Sam McAfee — Neo Innovation

@sammcafee

Page 2: Quantifying Risk For Innovation Teams...Team Cross-functional — Product, Design, Engineering Co-located and dedicated to the project Agile experience, and reading The Lean Startup

Scenario

San Francisco, 2011

Real estate industry

The Goal: Mobile application for service professionals

@sammcafee

Page 3: Quantifying Risk For Innovation Teams...Team Cross-functional — Product, Design, Engineering Co-located and dedicated to the project Agile experience, and reading The Lean Startup

Team

Cross-functional — Product, Design, Engineering

Co-located and dedicated to the project

Agile experience, and reading The Lean Startup

@sammcafee

Page 4: Quantifying Risk For Innovation Teams...Team Cross-functional — Product, Design, Engineering Co-located and dedicated to the project Agile experience, and reading The Lean Startup

Project

Customer Interviews

MVP Release

Frequent Iterations…

@sammcafee

Page 5: Quantifying Risk For Innovation Teams...Team Cross-functional — Product, Design, Engineering Co-located and dedicated to the project Agile experience, and reading The Lean Startup

Results

$300 app

5000 local professionals

50% conversion so far

@sammcafee

Page 6: Quantifying Risk For Innovation Teams...Team Cross-functional — Product, Design, Engineering Co-located and dedicated to the project Agile experience, and reading The Lean Startup

Assessment

Cost of user acquisition

Fixed costs — payroll, support, overhead

Market limits and revenue growth plateaus

User retention rates, and life-time-value per user

@sammcafee

Page 7: Quantifying Risk For Innovation Teams...Team Cross-functional — Product, Design, Engineering Co-located and dedicated to the project Agile experience, and reading The Lean Startup

Modeling Tools

!

Qualitative

Business Model Canvas

Personas

Value Dynamics Model

!

Quantitative

Metrics Frameworks

Cost of Delay Scenarios

Monte Carlo Simulation

@sammcafee

Page 8: Quantifying Risk For Innovation Teams...Team Cross-functional — Product, Design, Engineering Co-located and dedicated to the project Agile experience, and reading The Lean Startup

Business Model Canvas

@sammcafee

Page 9: Quantifying Risk For Innovation Teams...Team Cross-functional — Product, Design, Engineering Co-located and dedicated to the project Agile experience, and reading The Lean Startup

Personas

@sammcafee

Page 10: Quantifying Risk For Innovation Teams...Team Cross-functional — Product, Design, Engineering Co-located and dedicated to the project Agile experience, and reading The Lean Startup

Value Dynamics

@sammcafee

Page 11: Quantifying Risk For Innovation Teams...Team Cross-functional — Product, Design, Engineering Co-located and dedicated to the project Agile experience, and reading The Lean Startup

Metrics Frameworks

Lean Analytics Stages

Empathy

Stickiness

Virality

Revenue

Scale

Pirate Metrics

Acquisition

Activation

Retention

Revenue

Referral

@sammcafee

Page 12: Quantifying Risk For Innovation Teams...Team Cross-functional — Product, Design, Engineering Co-located and dedicated to the project Agile experience, and reading The Lean Startup

Cost of Delay Scenarios

@sammcafee

Page 13: Quantifying Risk For Innovation Teams...Team Cross-functional — Product, Design, Engineering Co-located and dedicated to the project Agile experience, and reading The Lean Startup

Cost of Delay Scenarios

@sammcafee

$5.9M

$1.5M

Page 14: Quantifying Risk For Innovation Teams...Team Cross-functional — Product, Design, Engineering Co-located and dedicated to the project Agile experience, and reading The Lean Startup

Monte Carlo Simulation

@sammcafee

Page 15: Quantifying Risk For Innovation Teams...Team Cross-functional — Product, Design, Engineering Co-located and dedicated to the project Agile experience, and reading The Lean Startup

Questions? [email protected]

Thank You!

@sammcafee