Getting Good Designs Built

Getting Good Designs BuiltVictor LombardiJune 26, 2007

Sponsored by

http://www.ixda.org/

http://smartexperience.org/

“The Promising Syllabus”

I promise to help you do something you probably couldn’tdo before, but…

We all need to take responsibility for our own learning

1. Explain what you want to know2. Ask clarifying questions3. Tell us about your experience

Agreed?

Great, let’s get started…

When design is the strategy

"[the iPhone is pushing operators] to meet its designvision rather than the other way around and refuses to betied to requirements that befuddle the UI and lead to anincoherent user experience. Stan Sigman (CEO ofCingular) revealed that Cingular had entered into acontractual agreement with Apple two years ago withoutever seeing the product, based purely on the strength ofthe design vision.”http://visionmobile.com/blog/2007/01/iphone-delivers-a-genuinely-disruptive-ui/

For the rest of us…

"I understand that we must compromise with the largerforces of business that buffet us, but that doesn't meanwe have to become quislings. Just because they force ill-chosen compromises upon us does not mean that we arerequired to justify them as being necessary or evenadequate."– Alan Cooper, IxDA email discussion, not too long ago

Know business fundamentals

Understand your context

Discover the company’scompetitive advantage

Align your customer need with company priorities

My framework…




Concepts and vocabulary

Financial basics

Scenarios


Meet Them More Than Halfway

“The better strategy fordesigners would be to regardthe current effort to educatethe CEO about how designerssee the world as a lost cause,and instead try to educatethemselves on how the CEOsees the world.”- Richard Farson, “Designersas Leaders”

http://www.wbsi.org/farson/com_design_leaders.htm

Financials + Scenarios

Expected ReturnIgnoring fees to calculate the expected return of loan interest and equity

Fail after 3 years Fail after 4 years

Replay loan, no

equity

Replay loan, 50%

of equity

Replay loan, 100% of

equity

Replay loan,

150% of equity

Percentage of loan repayment 60% 80% 100% 100% 100% 100%

Average Investment 8,333,333$ 8,333,333$ 8,333,333$ 8,333,333$ 8,333,333$ 8,333,333$

Loan repaid 5,000,000$ 6,666,667$ 8,333,333$ 8,333,333$ 8,333,333$ 8,333,333$

Interest gained 990,000$ 1,320,000$ 1,650,000$ 1,650,000$ 1,650,000$ 1,650,000$

Probability of outcome 2% 3% 5% 15% 65% 10%

Expected value of loan repayment 119,800$ 239,600$ 499,167$ 1,497,500$ 6,489,167$ 998,333$

Equity multiple 0 0 0 2 4 6

Potential equity -$ -$ -$ 16,666,667$ 33,333,333$ 50,000,000$

Probability of outcome 2% 3% 5% 15% 65% 10%

Expected value of equity -$ -$ -$ 2,500,000$ 21,666,667$ 5,000,000$

Expected value of loan and equity 119,800$ 239,600$ 499,167$ 3,997,500$ 28,155,833$ 5,998,333$

Expected return 39,010,233$

Outcomes

• Numbers can be sketches and prototypes• Financial models are based on assumptions about the

future of the product• Scenarios can be written in Excel

Case Study of Corporate Strategy: Microsoft

In 2005 an internal memo by Ray Ozzie, Microsoft CTO,was published publicly…

Summary of Ozzie’s Recommendation: Scenarios

1. Work with division presidents to assign “scenarioowners”

2. Work with these individuals “to concretely map outscenarios and pragmatically assess changes needed inproduct and go-to-market plans related to services andservice-based scenarios” both short- and long-term

3. “All Business Groups …develop their plans to embracethis mission and create new service offerings that delivervalue …and… utilize the platform capabilities…”

4. A blog





Interpersonal relationships

Dialog style


Financial basics

Scenarios

Abductive Reasoning

"We can't afford the new widget. Do you want to use existing widget Aor B?"“What else do we have? How else can we use it? How else can weget the money for the new widget? Can the new widget do somethingadditional to help the people making the financial decision? Let’sbrainstorm more options…”

For more on abductive thinking see Liedtke, http://www.rotman.utoronto.ca/pdf/rotman_mgmt_winter03.pdf

Question the constraints, andgenerate options within theconstraints

Constraints

Generate new options, use aprocess to narrow them down, thendecide

Jump to obvious options

CollaborationNegotiation

Try:When faced with:

The Neuroscience of Leadership

David Rock and Jeffrey Schwartz

• Change is pain Organizational change is unexpectedly difficultbecause it provokes sensations of physiological discomfort.

• Focus is power The act of paying attention creates chemical andphysical changes in the brain.

• Expectation shapes reality People’s preconceptions have asignificant impact on what they perceive.

So…• Focus people on solutions instead of problems• Let them generate their own insights• Keep them focused on their insights

http://www.strategy-business.com/press/article/06207?pg=all






Dialog style

At each level:

Corporate

Business unit

Business model

Product Line

Product

Operations


Financial basics

Scenarios

Example: Acme Publishing Company

Strategy:“Change mix of business to keep up with evolvingconsumers and advertisers; become more brand-centricand expand market-leading brands; innovatively attract newcustomers; and explore new revenue opportunities throughcross-selling and multi-platform sales.”

Implications for the designer:Talk about new design team hires in terms of how it willbenefit marketingTry to introduce features that also become ‘marketingfeatures’, e.g. Wow/viral features

Role that design plays in offering

Cus

tom

er F

ocus

•AIG

•Coke

•Time Inc.

•Apple

•Alessi

•General Motors

Many paths to success…

Role that design plays in offering

Cus

tom

er F

ocus

•Aveo

•Kodiac

•Corvette

•Silverado

Product Level Focus

The Leverage School of Strategy…

+ =

Evolving Strategy

GoogleGoogle 1.0 search engineGoogle 2.0 sold its search capacity to AOL/Netscape,Yahoo…Google 3.0 sold simple text ads linked to search resultsGoogle 4.0 inserted relevant ads into any and all WebcontentGoogle 5.0 is an innovation factory that produces atorrent of new Web-based services, including Gmail,Google Desktop, and Google Base

Gary Hamel, “Management à la Google”http://tinyurl.com/o4w7f

Buying strategic options…





Align with short-term priorities

Align with strategy

Develop an approach for building your capabilities(e.g. bootstrapping)


Dialog style

At each level:

Corporate

Business unit

Business model

Operations


Financial basics

Scenarios

A little about business strategy, and an exercise…

Business Strategy in One Slide: Porter’s Generic Strategies

“Strategic management is the process of specifying an organization's objectives,developing policies and plans to achieve these objectives, and allocating resources soas to implement the plans. It is the highest level of managerial activity, usuallyperformed by the company's Chief Executive Officer (CEO) and executive team. Itprovides overall direction to the whole enterprise. An organization’s strategy must beappropriate for its resources, circumstances, and objectives. ”

Porter’s Generic Strategies:• Cost Leadership: sell at lower prices, usually by lower

costs or by selling in volume

• Niche: focus on one audience type and satisfy theirparticular wants or needs

• Differentiation: offer a perceivably different brand,product, or service

http://www.quickmba.com/strategy/generic.shtml

Cost Leadership

Differentiation

Which is the Internet Best For?

Price/Cost Niche Differentiation

Generic Strategies on the Internet

Cost Leadership Niche Differentiation

Cost Leadership + Differentiation: Blue Oceans

• "Blue oceans" are untapped and uncontested markets.Blue ocean offerings cross conventional marketsegmentation while simultaneously achieving lowercosts/price.

http://business-model-design.blogspot.com/2007/01/nintendos-blue-ocean-strategy-wii.html

Strategy Canvas: Wines

http://tinyurl.com/yp2fzd

Blue Ocean Exercise: Online Diet & Fitness Programs

High

Low

Offering

MealPlan

FitnessPlan

Tracking/Reporting Style Price Community Offline

WeightWatchers

FitDay

RealAge

Daily Plate

Invent a blue ocean business concept that will offer something radically different and cost less thancompetitors. Add additional criteria to this graph if you like.What is the name of the product or service?How is it better for customers?How does that way of serving customers also help save money?

Getting Good Designs Built

Business

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