1 . D EA SC SS R II G BN EM TE HN E TS # E R1 V I C E
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Case Study - Slack
SERVICE DESIGN & I N N O VAT I O N PSSD - PS2 Daniela Ă lvarez Lleras Paola Guerra Giulia Mangolini Chiara Pacchiarotti
INDEX
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Table of contents
INTRODUCTION: CASE STUDY
Pag.
4
1. DESCRIBE THE SERVICE 1 . 1 W H AT
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Map of the offering
1.2 HOW
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Customer Journey Map
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Business Model Canvas
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1.3 WHO
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Customer Journey Map
2 . A N A L Y S E T H E S E R V I C E I N N O VAT I O N 2.1 LEVEL OF NEWNESS
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2.2 DEGREE OF CHANGE
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Competitors analysis
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2x2 Competitors Matrix
2.3 DIMENSIONS OF NOVELTY Major Transformations Map
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2 . 4 PAT T E R N S O F I N N O VAT I O N
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2 . 5 M E A N S O F I N N O VAT I O N
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2 . 6 C O - C R E AT I O N O F VA L U E
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3. SOURCES
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CASE STUDY
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Slack Communication service for companies
CO U N T RY A N D TOW N USA, Los Angeles
Y E A R O F S TA R T 2014
TYPE OF SERVICE B2B SaaS communication platform Image of the service
Source: slack.com
1. DESCRIBE THE SERVICE
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1 . 1 W H AT Slack is a B2B cloud based SaaS (software as a service) platform that simplifies communication between team members, which before was divided between emails, numerous applications and meetings. The value proposition of Slack is to create “Organizational Transformation”[1] through the integration of apps, time saving features and reduction of communication costs. This makes work simpler for the users who - Slack states - are the most important asset, since they give the company constant feedback, to develop a better user experience in the platform. Slack claims to be “where the work happens”[2], as with the integrated functions it covers every aspect of teamwork management. Slack has been one of the fastest growing start-ups ever. Starting in 2014 with 15.000 users, today it counts with over 9 million weekly active users and has been chosen by 50.000+ companies worldwide. 43 companies from the Fortune 100 list have paid Slack workspaces and 100 companies in over 100 countries use Slack[3].
Slack Offering Map Map of the offering
Cloud Service - SaaS
Organizational transformation For Teams
Security
Da ta
Ba lo s ck sp up rev e nt Inf ion ras tr u ctu re
Integration
Cu st Ap omi De za pi vic ble n es yn tegra ch t ron ion iza tio Fil n es ha rin g
Alignment
Kn ow le d ge Fa M ste r d anag ec isio eme n m nt ak Tra ing ns pa ren cy
Be tte Le r wo ss r dis kflo b il w ity tra of cti inf o orm ns ati on
Productivity
Av ail a
All co Fa nv st Inv ers an o lv a de tio em ffic ns en in ien to on t f te e pla am ce m em be rs
Communication
For companies
[1] https://medium.com/@stewart/we-dont-sell-saddles-here-4c59524d650d [2] https://slack.com/ [3] https://growthhackers.com/growth-studies/slack-fastest-growing-b2b-saas-business-ever
1. DESCRIBE THE SERVICE
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1.2 HOW Slack can be used across different devices. Its platform is organized in workspaces, where team members can communicate and be more efficient. To create a workspace for the first time, the users need to enter their email and choose a name for the workspace, that will become part of its URL. After that, the creators (Owners) can recruit Admins to help manage and organize the team, and they together invite and onboard members. New members only have to accept the invitation to start contributing. Workspaces also can be divided in channels, groups based on topics of discussion. Another feature of the service are the direct messages, used to talk to a single member or few members of the team. Users can search for specific messages or view the starred ones and their mentions in the upper-right corner of the interface. Notifications will tell them about what needs their attention; they can customize them to prioritize the most important things. Moreover, the platform integrates a wide range of other services, such as Twitter, Dropbox, Google Docs, Jira, GitHub, MailChimp, Trello, and Stripe, that allow the teams to stay coordinated and reduce context switching. Slack offers four subscription options: freemium, standard, plus and enterprises grid where the difference relies on the storage, quantity of apps integrated and security of the data.
Slack’s interface
cha nne l s
wo r ksp ace s
s e ar c h b ar
d ir e c t me s sa g es
in te g rate d ap p
Source: slack.com
1. DESCRIBE THE SERVICE
Customer journey map
Phase
Key Activities
Thinking/ Motivation
Discover Word of mouth
Triggering your curiousity for the platform/service.
Searching information
Decide Visit landing page
· Discovering a problem you didn’t think you have. · “It looks like they are not trying to sell me something”.
Sign up
Use
Join
· “It is free, I’ll try”. · “Maybe it works for my team in the company”.
Pay Habit creation
Start
On App work
· “I just have to enter my e-mail” · “It is easy to learn how to use it”
· “ I want to be updated” · “I want to search a file from when I didn’t work here” · “I want to decide something without having a meeting”
Doing/ Activities
· “ I need to be updated” · “What if I’m missing something?”.
Maintain
Plan selection
Payment
· “ I need to keep searching files and keeping track of everything that has happened inside the company”
Contributor
· “ I would like to comment or suggest changes in the service”
Brand Evangelizer
· “ I’ll recommend it to my friends”. · “I love interacting with Slack through Twitter”
Decision making
Screensharing
Talking about Slack and its benefits
Ask friends Searching information on-line
Learning Slack’s benefits and features
Introducing e-mail Confirm invitation
Bot interaction Learning how to use it
Invite team members
Topic related Messaging
Calls
Create channels
Recommend to friends
Direct Messaging
Search - Share information
Select type of subscription
Check notifications
Select payment methods Receive refund if there is no longer an active member
Interaction with the brand through feedbacks
Active participation in Slack’s community
Work across channels
Work Sharing Experience towards Slack Slack platform
Touchpoints word of mouth
User/ Subscription
Freemium Standard Plus Enterprise*
websites S.M
word of mouth
Slack’s site
Bot interaction
Video tutorials
Social media
Slack’s site
Web sites
5G storage 10k messages
Slack platform
word of mouth
1. DESCRIBE THE SERVICE
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Business Model Canvas
Key Partners
Key Activities
Value Propositions
· Third-party integrators
· Customer experience and customer success. · App integrations · Design (ux/ui and research) Software development · App maintenance · Operations · Marketing
· Organisational transformation through simplified communication.
Key Resources
· Smooth and clean ux/ui design.
(Slack provides mobile apps for iOS, Android, Windows Phone, in addition to their web browser client and native clients for macOS, Windows, Linux, Slack is also available for Apple Watch)
· Users as co-producers. · Business Angels (Venture Capitals)
· Developers · Year Up
(Slack gives all profits of its merchandising shop to a one-year training program that connects young adults from underserved communities to professional careers in the tech industry)
· Partners of Slack Fund
(An investment fund started by Slack in partnership with Accel, Index Ventures, KPCB, Social Capital, Andreessen Horowitz, and Spark Capital)
· Slack team: organisational culture. · Digital platform · IT infrastructure · Social Media and non-payed publicity. · Subscribers and Active users. · Community of brand evangelizers.
Cost Structure · · · · · ·
Product features Development IT infrastructure (AWS) Hosting Operations Staff
· Improvement of productiviy with platforms integration.
Customer Relationships
Customer Segments
· Word of mouth awareness. · Users as co-producers and part of Slack’s community. · Brand evangelizers · Service support 24/7 · Guidance and instructing
· Small teams (Not necessarily working on the same company or on the same space) · Large companies (For multiple teams inside one organisation) · Institutional (Customized plans and more security for big enterprises)
· Simpler, efficient and transparent internal communications
Channels · Slack Platform (web application and mobile app). · Website · Social Networks · Targeting blogs (i.e. Medium) · Third-party integrators · Slack shop (merchandising)
Revenue Streams · · · · ·
Help Desk Integration projects Marketing Year Up Slack Fund
Sources: https://www.slack.com/ https://vizologi.com/business-strategy-canvas/slack-business-model-canvas/
· Subscription plans
(Slack follows a Freemium business model. Basic features are free for all users, but for unlocking more features users have to pay a subscription fee. There are three plans for Teams - FREE, STANDARD and PLUS - and a special plan for Enterprise Grid, in which Slack develops a customized solution for the whole company.
2 . A N A L Y S E T H E S E R V I C E I N N O VAT I O N
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1.3 WHO The main stakeholders are the user base, the Strategic Partners, the Platform and Security Partners[4] and the investors. The user base is composed by free users, enterprises (using Grid) and subscribing teams. Users give constant feedback to the platform and spread the word about it, thus creating value and awareness. The Strategic Partners are the companies developing systems together with Slack. Platform and Security Partners are respectively the providers of the apps that can be used in Slack and the companies that work to ensure that the data of Slack’s customers are safe. The investors are the organisations that invested in Slack, such as Google Ventures, Accel Partners, and more. Some of them also take part in the Slack Fund [5], which awards developers working on new apps for the platform through the company’s API[6]. There are also other stakeholders represented in the system map.
System map money work
rty integrato rs third-pa
service
Strategic partners
feedback
Business Angels
IT vider
money
Platform partners
work
Security partners
Investors
IT provider
elopers Slack Fund
Slack
es
Developers
Non profit (Year Up)
Employees
Subscribers us
er
Enterprises
Free users
ba se
[4] https://slack.com/partners [5] https://en.wikipedia.org/wiki/Slack_(software) [6] https://slack.com/developers/fund
service feedback
2 . A N A L Y S E T H E S E R V I C E I N N O VAT I O N
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2.1 LEVEL OF NEWNESS We can define Slack’s innovation as “new to the firm” since the company and the concept were created when the team was developing a multiplayer game. The members noticed how IRC, the tool they were using to collaborate over long distances, allowed them to focus on projects turning out all the email inbox noises. The entire company, thus, focused on creating an efficient communication tool. Slack was not the first messaging app in the market when it launched in 2014, but the developing team had the right intuition: they focused on the needs of a specific customers segment and created a new kind of service: a tool for internal communication for companies. Considering the innovation of meaning[7], we can describe it also as “new to the market” (Global), because no company had proposed a communication with the same value proposition: making work simpler and faster, through an open platform, all in one place. Other companies in the market were selling only a communication tool with few integrated functions, but none of them were selling an organizational transformation or creating a better experience for the customers through user centered design. These features made sure for Slack to gain more recognition and brand awareness.
2.2 DEGREE OF CHANGE This service can be defined as an incremental innovation because, although there were already messaging apps dedicated to the work environment, Slack created a new meaning for team messaging platforms. It changed the market by identifying a need - a platform for communicating and working at the same time - that was unknown to its customers. In fact, when companies were asked which tool they were using for communicating, the answer was usually “nothing”, although they were using a mix of different tools and services to do so. Slack’s intuition was confirmed by the impressive growth that followed its release, just thanks to the word of mouth. The app also brought some improvements to the functions normally performed by company communication services: the developers based the app on channels, that differ from chat groups since they are based on topics instead of groups of people; moreover, they opened the network to external applications and developers, extending their functionality and distribution; finally, they made file and link sharing a smooth, fast and easy process thanks to a good UI and offered an efficient search bar[8]. Change of meaning
Before
Now
Communication apps where people talk about work.
Communication app where the work happens.
[7] In design-driven innovation the value creation drivers are the new meanings behind the service, that enable more profound emotional, affective and cognitive forms of engagement. (Verganti, 2009) [8] https://growthhackers.com/growth-studies/slack-fastest-growing-b2b-saas-business-ever https://www.quora.com/Whats-the-value-proposition-of-Slack
2 . A N A L Y S E T H E S E R V I C E I N N O VAT I O N
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Competitors analysis
End Benefit
“Turn conversations into actions”
“An ideal way to communicate”
“Where work happens”
Time in the market
2010
2013
2014
Freemium Integrations with other apps
15 apps
Over 1.000 apps
20 apps
Calls + Screen sharing File Sharing Search and Archiving Constant user feedback Smooth user experience Brand Awareness Social Media Interactions
2x2 Competitors Matrix
Integrating Apps
stride
whatsapp Productivitypersonal
Productivityteams skype
Yammer Fleep
Replacing Apps
2 . A N A L Y S E T H E S E R V I C E I N N O VAT I O N
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2.3 DIMENSIONS OF NOVELTY The major transformations are the concept and the client interface. About the concept, the company created a new market of which they became leaders, building a different business model. The value proposition is the core of this shift. The benefit they are providing is not only about facilitating the communication, but also about transforming work dynamics, being the place “where work happens”. Everything supported by their multiple features, integrations and smooth UX/UI design. Their relationship with the key partners is also a novelty: instead of competing with the main productivity tools/platforms, they took an “integrating instead of replacing” approach, merging everything in one platform. Due to the company’s history, the organisation´s relationship with their users also helps the transformation of concept, since they are the main input of improvements and changes in the app. The client interface is also strongly related to their transformation. The interaction of the users in the platform and social media is a major change in the customer-company relationship. As a result of this whole approach, the distribution channels are completely different from the ones a SaaS company would use. In addition to this, Slack did not have a sales team or a strong marketing department, so the word of mouth was decisive to make them leaders in the market.
HipChat’s Interface
Slack’s Interface
[9] https://slack.com/features
2 . A N A L Y S E T H E S E R V I C E I N N O VAT I O N
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Major Transformations Map
Before (from) / Competitors Approach
ay tion e w ica On un m m co
Provider
Key Partners
Co mp e a intend so titors gra me tion s
Sharing users
Users
Other productivity platforms
Key Partners
Now (to)/ Slack’s Approach
Market of organisation’s internal communications
Co-Producers
two way comm.
Ke yP art ne rs
Slack Users
t no g, ing n i c us pla re
Other productivity platforms
2 . A N A L Y S E T H E S E R V I C E I N N O VAT I O N
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2 . 4 PAT T E R N S O F I N N O VAT I O N Slack’s innovation comes from the clients, the organisation and the supplier. As we have mentioned before, the clients are the main resource for the company to develop a better product. The constant feedback given in the platform and communication through social media to report the problems created a platform with a smooth user experience that fits the necessities of the users. On the other hand, Slack realised that there wasn’t a market focused to improve and simplify internal communications at companies. The founders saw an opportunity and developed a great solution to a non-existent business, making them the leaders in the fast-growing work-stream collaboration (digital communication and collaboration tools for teams and businesses) market[1]. The innovation comes also from the suppliers who developed all the design and the interactions in Slack: the branding was such a success that it created an incredible awareness among the users, so much that now people immediately relate the name and logo of Slack to productivity and efficiency. The customer base grew mainly thanks to word of mouth. This way, in order to become part of the community, stay updated and improve teamwork, people start using Slack and it creates an engagement so strong that it becomes really hard to displace it[2].
2 . 5 M E A N S O F I N N O VAT I O N The resources used to operationalize the innovation are mostly high-touch. There were already chat platforms in the market, that offered alternatives to e-mail like Skype or HipChat, but none of them were created for the specific purpose of internal communications at companies. Slack created a new product, based on existing ones under a new value proposition, which is to create organisational transformation. The developers introduced a new role for the user by working around customer centricity[1]. They gave and still give a lot of importance to the experiences that their users have in the platform: it’s thanks to their feedback that the navigation is smooth and easy to understand. The interactions were not designed just to help users understand what happens, but also to engage them[2]. These are the main reasons that made the platform more accessible, more effective and more attractive. Eventually we can define Slack as collaborative design: the company analysed the market and developed a solution using an existent product in an original way (value proposition), all through direct relationships between the consumers, who became co-producers[3], and the human capital of the company, dedicated to gather all the information that they provide.
[10] https://www.gartner.com/doc/reprints?id=1-4K5I75F&ct=171108&st=sb 1.https://www.gartner.com/doc/reprints?id=1-4K5I75F&ct=171108&st=sb 2 https://medium.com/@awilkinson/slack-s-2-8-billion-dollar-secret-sauce-5c5ec7117908 3. Libro Collaborative Services. Social Innovation and Design for sustainability.
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2 . 6 C O - C R E AT I O N O F VA L U E The provider, the clients and the partners are the ones that benefit from the innovation. Slack, as the provider, benefits from its innovation in terms of revenues and users’ awareness. The freemium option creates an engagement from the beginning and it leads to a even transition to a subscription. Thanks to the new role of co-creators of the users, the platform offers a smooth experience and has become a leader in the market, making it difficult for competitors to unseat it. On the other side, users gain benefit from a platform that fits their necessities, listens to them, allows them to connect with people but also with the different tools that they use daily, providing productivity with the integration of the different apps. The partners (considered as the apps integrated in the platform) benefit from the innovation gaining recognition in the Slack community, since they provide a better workflow among the teams and team members.
3. SOURCES
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B I B L I OG R A P H Y & S I TOG R A P H Y · Verganti, R. (2009). “Design-driven innovation” Harvard Business Press. · Prahalad, C. K.; Venkat Ramaswamy. (Summer 2004). “Co-creation experiences: The next practice in value creation” Journal of Interactive Marketing; ; 18, 3; ABI/INFORM Global pg. 5 · The Slack’s website presents a wealth of compelling, well-researched information about their platform, benefits and information regarding the app integration, Slack’s website <https:// slack.com/> · From 0 to $1B - Slack’s Founder Shares Their Epic Launch Strategy. First Round Review. (Retrieved March, 2018). http://firstround.com/review/From-0-to-1B-Slacks-Founder-SharesTheir-Epic-Launch-Strategy/ · Careers at Slack. (Retrieved March, 2018). https://www.cleverism.com/company/slack/ · Von Wilpert, C. (July, 2017). Peek inside Slack’s multi-million dollar SaaS growth strategy. OpenView Partners Blog. (Retrieved March, 2018). https://labs.openviewpartners.com/slacksaas-growth-strategy/#.Wqa2w2aZPUp · Butterfield, S. (Feb 17, 2014). We Don’t Sell Saddles Here. Slack on Medium. https://medium. com/@stewart/we-dont-sell-saddles-here-4c59524d650d · Drift. (January, 2017). How Slack Grew Into A Billion-Dollar Company. Without A Sales Team. https://www.youtube.com/watch?v=pAksY5xLYZs · Dewnarain, G; O’Connell, D; Gotta, (06 October 2017). M. SWOT: Slack, Worldwide. Gartner Consultancy. (Retrieved March, 2018). https://www.gartner.com/doc/reprints?id=14K5I75F&ct=171108&st=sb · Wilkinson, A. (May 1, 2015). Slack’s $2.8 Billion Dollar Secret Sauce. (Retrieved March, 2018). https://medium.com/@awilkinson/slack-s-2-8-billion-dollar-secret-sauce-5c5ec7117908
3. SOURCES
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· Brown, M. (2015) How Slack Became the Fastest Growing B2B SaaS Business (Maybe) Ever. (Retrieved March, 2018). https://growthhackers.com/growth-studies/slack-fastest-growing-b2bsaas-business-ever · Jégou, F.; Manzini, E., edited by, (2008), _Collaborative Services. Social Innovation and Design for sustainability_, POLI.Design Edizioni, Milano · Vizologi. Slack Business Model Canvas. (Retrieved March, 2018). https://vizologi.com/ business-strategy-canvas/slack-business-model-canvas/ · Miles, I. (February 2008). Patterns of Innovation in Service Industries. Article in Ibm Systems Journal. · Wikipedia. Slack (Software). (Retrieved March, 2018). https://en.wikipedia.org/wiki/Slack_ (software) · Randhawa, K; Scerri, M, (2015), Literature Review: The Handbook of Service Innovation,Springer-Verlag, London
PSSD POLITECNICO DI MILANO MARCH 2018