BIF's Design Methodology Playbook

BIF'S DESIGN METHODOLOGY PLAYBOOK

A note from our Founder and Chief Catalyst The time has come to be a market maker, not just a share taker.

Business model innovation is the new strategic imperative for all organizations. Transformation is not a wait and see game, the road signs for disruption are on the path right in front of us.

Too many either don’t see the obvious signs of disruption or choose to ignore them. We see the competitive landscape through the lens of our own industries and their prevailing dominant business models. Business model innovation isn’t about best practices, it’s about next practices. If you wait for the signs of disruption to appear, it is already too late. The job-to-be-done for institutional leaders is to explore, test, and commercialize next practices and new business models. R&D for new business models is the new strategic imperative.

Since its inception fourteen years ago, Business Innovation Factory (BIF) has been developing and integrating the next practices of human-centered design, rapid prototyping, and storytelling/ engagement into all of our client project work. These lynchpin capabilities now enable us to deliver on our value proposition: BIF helps institutional leaders make transformation safer and easier to manage.

I am beyond proud, on behalf of our entire team, to introduce BIF’s Design Methodology Playbook.

We openly share our playbook to enable more institutional leaders to go from tweaks to transformation. We put everything that we’ve learned about enabling business model innovation, including all of the how-to-guides and tools we’ve developed, into our Design Methodology Playbook.

It details each of the 22 steps in BIF’s four-phase (Shift, Conceptual Design, Prototype and Test, Commercialize) Business Model Design Methodology. The playbook clearly describes how we help institutional leaders explore and test what’s next.

We also share our playbook because, at BIF, we believe that our important social systems, including healthcare, education, and public services, are broken and that transformation becomes possible when we share and learn from each other’s approaches, platforms, and tools. That’s how we get better faster, together.

BIF’s Design Methodology Playbook is a work-in-progress, we are always improving and adding to it.

By sharing it and learning from each other we collectively get better at enabling transformation.

We live in a time that screams for transformation yet too many institutions are only capable of tweaks. We developed BIF’s Design Methodology Playbook because a growing number of institutional leaders know they need a better approach to innovation. Together, we can make transformation safer and easier to manage.

CONTENTS 01

INTRODUCTION

02

BIF’S DESIGN METHODOLOGY OVERVIEW

10 SHIFT 17

57

develop research strategy and plan recruit customers to observe experience gain deep understanding of customer experience identify key actionable insights identify key job-to-be-done develop storytelling assets to engage stakeholders

62

CONCEPTUAL DESIGN

23

29 45 51

create value

69 75

translate job-to-be-done into a value proposition imagine a new customer experience

deliver value

95

101

isolate the lynchpin capabilities fill out details of process, people, and tech depict how the capabilities work together

capture value

89

107 113

118 125 133 141

149

155 163

identify potential revenue streams identify key cost drivers

PROTOTYPE AND TEST

plan prototype build prototype recruit participants run prototype iterate prototype incorporate key learnings

168 COMMERCIALIZE 175 181

187

evaluate alternatives and select strategic option identify commercialization requirements for selected strategy develop commercialization roadmap

We can’t do this alone.

We need your help.

BIF released its Design Methodology for Next Practices and New Business Models. We want to share with you a work-in-progress: our Design Methodology Playbook.

Transformation is hard and we want to make it safer and easier for organizations to try more stuff, namely next practices and new business models. We know that people who work in organizations often feel threatened by anything that may disrupt the current way their business model operates.

Sure, they will try a tweak here and there, but the real transformation happens when you play with all the parts of the organization.

Here is where we need your help. If we are going to make a difference in this world, we need more people that feel confident in a process that makes it safer and easier to manage business model transformation.

We developed this playbook to put everything that we have learned in your hands. We will take you through all 22 steps, from gaining customer experience insights to commercializing your new business model.

Because together, we can change the world.

1

BIF’S DESIGN METHODOLOGY FOR NEXT PRACTICES AND NEW BUSINESS MODELS

PHASE 1

PHASE 2

CREATE

DELIVER

CAPTURE

SHIFT

CONCEPTUAL DESIGN

Shifting the organization’s lens enables

Once a customer’s job-to-be-done is

leaders to see transformational

identified we can imagine a new customer

opportunities from the customer’s

experience and begin developing a next

perspective, translating them into an

practice or business model concept ready

actionable foundation for design.

to be taken off the whiteboard and into the market for testing.

THIS STEP RESULTS IN A

THIS STEP RESULTS IN A

Customer Experience as a Foundation For Design

Conceptual Business Model

THIS STEP IS NOT...

THIS STEP IS NOT...

Conducting traditional market research

Traditional business planning

2

PHASE 3

PHASE 4

PROTOTYPE & TEST

COMMERCIALIZE

With a conceptual next practice or new

With a market tested minimum viable

business model idea ready to test, a

business model organizations are in

low-fidelity prototype is developed and

the best position to develop a go-to-

taken into the market to test iteratively

market strategy and implementation

for desirability, feasibility, and viability in

plan to successfully commercialize next

the real world.

practices and new business models.

THIS STEP RESULTS IN A

THIS STEP RESULTS IN A

Minimum Viable Business Model

Commercialization Plan

THIS STEP IS NOT...

THIS STEP IS NOT

THIS STEP IS NOT...

Hoping commercial-scale offerings are market ready

Letting scale and change management questions prevent early exploration

3

PHASE 1

SHIFT

Shifting the organization’s lens enables leaders to see transformational opportunities from the customer’s perspective, translating them into an actionable foundation for design.

DEVELOP RESEARCH STRATEGY AND PLAN Shift starts by identifying target customer cohorts, developing selection criteria and recruitment goals, developing research materials and an actionable plan to recruit the desired group of customers to participate in field research.

RECRUIT CUSTOMERS TO OBSERVE EXPERIENCE Recruiting the right customers willing to participate in a human-centered design approach involving immersive observational techniques is important. It is always harder to do and takes longer than for traditional market research.

GAIN DEEP UNDERSTANDING OF CUSTOMER EXPERIENCE To fully understand the customer experience, not just what customers say they want, ethnographic research is conducted using methods such as qualitative interviews, observation, shadowing, and generative activities to get at behaviors and decision making.

IDENTIFY KEY ACTIONABLE INSIGHTS Identify key actionable insights that will help stakeholders see what is important about today’s customer experience viewed through a customer lens. Seeing customer experience with a different lens opens up new opportunities to address pain points and develop new solutions to address them.

IDENTIFY KEY JOB-TO-BE-DONE In order to align and focus next practice and new business model design on customer experience it is important to identify a target job-to-be-done (what the customer is actually trying to do or a problem they’re trying to solve).

DEVELOP STORYTELLING ASSETS TO ENGAGE STAKEHOLDERS Develop storytelling assets of the customer experience that can be shared with others to see through the lens of the customer. Stories will engage stakeholders of the organization to move in the direction of transformational change.

4

PHASE 2

CONCEPTUAL DESIGN

We can’t analyze our way to transformation, it’s a generative act.

The goal is to develop a high-level conceptual design, that we can quickly test and improve in the market, of how we imagine a next practice or new business model that will help customers with their job-to-be-done, transforming the customer experience.

TRANSLATE JOB TO-BE-DONE INTO A VALUE PROPOSITION The value proposition is the promise that an organization makes to the customer of how a next practice or new business model will solve the customer’s fundamental job-to-be-done.

IMAGINE A NEW CUSTOMER EXPERIENCE The value proposition serves as a foundation to imagine and create a shared view of the new customer experience required to deliver on an organization’s promise to help a customer with their job-to-be-done.

ISOLATE THE LYNCHPIN CAPABILITIES From the target job-to-be-done and shared view of a new customer experience it is important to identify the most important lynchpin capabilities essential to deliver the new experience and value to the customer.

FILL OUT DETAILS OF PROCESS, PEOPLE, AND TECH Once the lynchpin capabilities are identified it is important to create a shared high-level operating vision and picture of how they relate and connect to each other in order to deliver customer value.

DEPICT HOW THE CAPABILITIES WORK TOGETHER Each lynchpin capability is comprised of people (roles and skills), process (inputs, key activities, flow and outputs) and technologies (enabling tools) integrated to deliver customer value in a new way.

IDENTIFY POTENTIAL REVENUE STREAMS Brainstorm and identify potential revenue streams, where financial resources will come from, in order to capture value from the new customer experience and to evaluate ways to financially sustain value delivery.

IDENTIFY KEY COST DRIVERS Identify the most important cost drivers in the conceptual next practice or new business model so that even in the prototyping and test phase an organization can begin to understand the economics of delivering value.

5

PHASE 3

PROTOTYPE & TEST Testing and iterating a low-fidelity prototype results in a next practice or new business model that has survived customer contact and has been validated in a real world marketplace.

PLAN PROTOTYPE The experimentation strategy and plan outlines how a new concept will be converted into a lowfidelity prototype, a sourcing plan for lynchpin capabilities, what conditions are necessary for testing it, and the key activities, roles, and resources required.

BUILD PROTOTYPE A low-fidelity prototype can now be assembled, including recruiting and training people for their assumed roles in the lynchpin capabilities. The prototype is now ready to be moved off of the whiteboard into the real word.

RECRUIT PARTICIPANTS A representative sample of customers are recruited to experience the prototype to gain feedback on how the prototype solves their job-to-be-done. The participants are selected to provide multiple perspectives from which to measure efficacy.

RUN PROTOTYPE Having real customers go through the experience is the fastest way to understand what works and what doesn’t. The entire experience, or key aspects of it, may repeat multiple times to arrive at a model that works consistently in an efficient manner to create real value for customers.

ITERATE PROTOTYPE An adaptable prototype is responsive to the actual needs of customers by eliminating and adding capabilities to support a desirable and effective experience. Observing the customer experience enables changes to be made quickly and to see their impact.

INCORPORATE KEY LEARNINGS Incorporate the key learnings from the prototype to update the conceptual model with the changes that were made when testing it with customers in the real-world.

6

PHASE 4

COMMERCIALIZE

Evaluating strategic options to commercialize a next practice or new business model will inform a decision on whether and how best to go-to-market. Identifying key operating and change management implications will inform the development of an implementation roadmap for commercialization.

EVALUATE ALTERNATIVES AND SELECT STRATEGIC OPTION Evaluate commercialization strategy options including harvest key learnings, pilot at a larger scale, integrate directly into core business model, change core business model or spin off new business model.

IDENTIFY COMMERCIALIZATION REQUIREMENTS FOR SELECTED STRATEGY Identify key operating, change management, performance goals and metrics, and resource requirements for the selected commercialization strategy.

DEVELOP IMPLEMENTATION ROADMAP Develop a clear implementation roadmap detailing the plan, roles, timeframe, milestones and key activities to commercialize a market tested next practice or new business model.

7

LET’S GET TO WORK

This Playbook will take you through each phase, step by step, and includes tools and resources to help you learn what it takes to transform new business models.

SHIFT P H AS E 1 O F 4 :

10

PHASE 1:

SHIFT DEVELOP RESEARCH STRATEGY AND PLAN

RECRUIT CUSTOMERS TO OBSERVE EXPERIENCE

GAIN DEEP UNDERSTANDING OF CUSTOMER EXPERIENCE

IDENTIFY KEY ACTIONABLE INSIGHTS

IDENTIFY KEY JOB-TO-BE-DONE

DEVELOP STORYTELLING ASSETS TO ENGAGE STAKEHOLDERS

11

KEY TERMS Human-Centered Exploration: utilizing a mix of methods to understand not only what customers say but also what customers do and why, from their own perspective and experiences.

Customer Experience: the holistic story of how customers engage with the company and brand.

Key Actionable Insights: the main insight statements from the data that point to the main job the customer is trying to solve.

Job-to-be-Done: a description of what the customer is trying to do or the fundamental problem a customer is trying to solve.

12

SHIFTING YOUR LENS The key to transforming any organization is to start by changing your lens. If you see the world through the lens of how your organization currently works, you will only identify and select incremental innovation opportunities. Understanding an experience from the customer’s perspective provides an actionable foundation for design that leads to opportunities for transformation. Human-centered exploration involves utilizing a mix of methods to understand not only what customers say but also what customers do and why, in order to define the job that customers are really trying to perform. With an understanding of the customer’s actual job-to-bedone, the organization can create new value for its customers.

You cannot analyze your way to transformation; you have to explore your way there. The Shift phase does not consist of performing traditional market research but instead requires establishing a shared understanding of a customer’s experience, pain points, and job-to-be-done. The output of the Shift phase is not data; it is an actionable foundation for design. Building a shared understanding of the customer experience requires developing empathy with customers by talking with and observing them to understand how they see the world. The foundation established during Shift informs every other phase in the Methodology. No Shift, no transformation.

The Shift Phase results in an actionable foundation for design that is based in a deep understanding of the customer experience, the key actionable insights, and the job-to-be-done. With this understanding, you can start to explore new ways to create value for the customer that will solve their job-to-be-done. The output of the Shift phase informs every other phase of the Methodology.

13

Shifting the organization’s lens enables leaders to see transformational opportunities from the customer’s perspective, translating them into an actionable foundation for design.

14

SHIFT 1. DEVELOP RESEARCH STRATEGY AND PLAN Creating a Research Plan Research Exploration Worksheet 2. RECRUIT CUSTOMERS TO OBSERVE EXPERIENCE Recruiting Customers Participant Management Chart 3. GAIN DEEP UNDERSTANDING OF CUSTOMER EXPERIENCE Starter Research Types of Interviews Conducting Interviews Interview Tips Crafting Interview Questions Observational Research Techniques Preparing for Observation/Shadowing Observational Research Tips Observational Notes (AEIOU Framework) Notes & Observations Worksheet Empathy Map Exploration Debrief Worksheet 4. IDENTIFY KEY ACTIONABLE INSIGHTS Getting to Insights Observations to Insights Worksheet 5. IDENTIFY KEY JOB-TO-BE-DONE Getting to Job-to-be-Done Insights & Key Job-to-be-Done Worksheet 6. DEVELOP STORYTELLING ASSETS TO ENGAGE STAKEHOLDERS Crafting your Story Storytelling Template

15

16

SHIFT STEP 1 OF 6

DEVELOP RESEARCH STRATEGY AND PLAN

Before engaging with customers, you should develop an adaptable research plan that will help align your team around your research goals. To determine what you want to learn through your research, first define what you already know and do not know about the current customer experience. Next, identify the activities that will help you engage with customers to help you learn about their experiences, needs, and behaviors. Remember to choose activities that will help you test assumptions.

At a Glance • Develop a research plan that includes the research goals, questions, assumptions, activities, recruitment plan, budget, and team roles.

• Identify the target customer cohorts and develop the selection criteria and recruitment goals. When doing this, consider demographics, cultural considerations, and proximity.

• Outline the schedule of the research plan in a calendar or timeline.

17

DEVELOP RESEARCH STRATEGY AND PLAN

BIF Tips • Do not be scared to start talking to customers to help develop your research plan. This could illuminate your assumptions, narrow your research focus, and inform activities.

• Consider the strengths and weaknesses of the members on your team. Also, remember that this is a chance for people to grow their skill sets!

• Extreme users and non-users can reveal unconventional and non-obvious insights, so do not forget to consider them in your selection criteria.

18

DEVELOP RESEARCH STRATEGY AND PLAN

Developing a Research Plan Developing a research plan creates an initial course of action and aligns your team around the same goal. The research plan should act as a guide for activities and timing but also be flexible enough to adjust with new insights and opportunities. Every new customer interview and observation opportunity will take the research in unexpected directions and lead to the discovery of new actionable insights and patterns across interviews. Discovering the real customer job-to-be-done is more important than checking off the boxes on the original research plan.

Establish a Goal: This is the big picture of your research. Provide an overview of what the research aims to achieve.

Form Research Questions: What do you want to learn? The answers to these questions will help you to achieve your research goal.

Set a Schedule: Document the intended date and description for each research activity to be performed.

Determine Activities: Describe the activities that will be performed (i.e. user interviews, observations, expert interviews, group activities) and what the output will provide to the research.

Develop a Recruitment Plan: Develop your recruitment criteria, including the attributes that you will be looking for in participants. Consider what kind of participants can provide you with the most valuable information and outline how you plan to recruit these participants.

Establish a Budget: Based on your activities and recruitment costs, determine how much it will cost to conduct the research.

Form a Task List: Detail the activities, establish ownership of tasks, and estimate the due date to complete each task.

19

DEVELOP RESEARCH STRATEGY AND PLAN

GUIDE

CREATING A RESEARCH PLAN Complete each of these steps to create a thorough research plan that will help you and your team conduct research with participants.

ESTABLISH THE RESEARCH GOAL

This is the big picture of your research. Provide an overview of what the research aims to achieve.

Example: The goal of this work is to achieve a better understanding of what our employees need and want from their health care provider and health plan FORM RESEARCH QUESTIONS

What do you want to learn? The answers to these questions will help you to achieve your research goal.

Example: What goes into our employees’ decision-making process when choosing a healthcare provider or health plan? What might make employees leave one health plan to join another?

SET A SCHEDULE

Document the intended date and description for each research activity to be performed.

DETERMINE RESEARCH ACTIVITIES

Describe the activities that will be performed with the research participants, such as user interviews, observations, expert interviews, group activities, and what the output will provide to the research.

DEVELOP A RECRUITMENT PLAN

Develop your recruitment criteria, including the attributes that you will be looking for in participants.

Consider what kind of participants can provide you with the most valuable information and outline how you plan to recruit research participants, including any important deadlines or dates.

ESTABLISH A BUDGET

Based on your activities and recruitment costs, determine how much it will cost to conduct the research. Consider recruiter fees, stipends for participants, travel reimbursement for participants and/or staff, venue costs, catering/meals, materials and supplies.

FORM A TASK LIST

Detail the activities, establish ownership of tasks, and estimate the due date for each task.

Example: Reserve space for research activities by October 9, Notes: Holds 20 people

20

DEVELOP RESEARCH STRATEGY AND PLAN

TOOL

RESEARCH EXPLORATION WORKSHEET Answer these questions before you go into the field to help you & your team align around your research goals & plan.

who are the members on your team?

where is your field site?

What do you want to learn?

what activities are you doing? what are your teammates doing?

21

22

SHIFT STEP 2 OF 6

RECRUIT CUSTOMERS TO OBSERVE EXPERIENCE

Human-centered research is intimate and has the potential, if not undertaken with care, to be uncomfortable for both researchers and participants. It is important to create relationships with participants in order to foster transparency and vulnerability, and to gain a thorough understanding of their experiences.

Consider recruiting a variety of customers to participate in research activities in order to understand different perspectives and points of view. Recruiting a small number of these participants will take more effort than finding a homogeneous group for traditional market research, but engaging diverse participants will yield a deeper and more genuine understanding of the lived customer experience. Once you have identified your research participants you will need to schedule and confirm appointments for research activities.

At a Glance • Outreach to potential participants.

• Screen your potential research participants to ensure that they meet the required criteria developed in your research plan.

• Confirm the final participants and secure their commitment.

23

RECRUIT CUSTOMERS TO OBSERVE EXPERIENCE

BIF Tips • Rely on existing networks and relationships to help recruit participants.

• Focus on finding a select group of participants who are willing to engage deeply with you in the research process, rather than a large number of participants who are willing to engage on a surface level. (i.e.

A dozen personal interviews vs. 100’s of survey responses.)

• Be aware of how offering incentives might impact those willing to participate.

24

RECRUIT CUSTOMERS TO OBSERVE EXPERIENCE

Recruiting Customers It is important to be sensitive and intentional about who you recruit and how.

Determining criteria for recruitment will help you prepare to reach out to potential research participants and secure their commitment. Remember: you are aiming to find a select group of people who are willing to share their unvarnished experience, so work to establish a relationship with potential participants and try to recruit individuals with a range of experiences. You will consider these attributes when determining your criteria: Number of Participants: Human-centered exploration does not require a large number of participants but instead focuses on the quality of interactions within a smaller sample size.

Demographics: Determine which demographics are important to your research, as this will vary based on your research goals and activities.

User Types: Focus your study on different types of users (i.e. core user, extreme user, expert user, non-user). Be sure to include extreme users and non-users since they can provide unconventional and non-obvious insights.

Type of Research Engagement: Different research methods require different levels of engagement and commitment from the participant.

25

RECRUIT CUSTOMERS TO OBSERVE EXPERIENCE

GUIDE

RECRUITING CUSTOMERS Consider the following attributes when determining the right people to recruit for your research.

NUMBER OF PARTICIPANTS

Human-centered exploration does not require a large number of participants but instead focuses on the quality of interactions within a smaller sample size. There is no right answer for number of participants, but we suggest starting with 15 to 20. The goal is not to create a large enough sample size to perform statistical analyses; it is to go deep enough with a representative cohort to glean actionable insights that can be used to imagine new and better solutions.

DEMOGRAPHICS

Determine which demographics are important to your research, as this will vary based on your research goals and activities. Some demographic information to consider might include age, location, marital status, education, employment, and income.

USER TYPES

Focus your study on different types of users (i.e. core user, extreme user, expert user, non-user). Be sure to include extreme users and non-users since they can provide unconventional and non-obvious insights.

TYPE OF RESEARCH ENGAGEMENT

Different research methods require different levels of engagement and commitment from the participant (e.g. one-time encounter for an interview or consecutive interactions for participatory design).

KEEP IN MIND

As you develop your recruitment criteria, it is important to consider multiple factors which will influence how you reach out to potential participants. Some of these factors include: • Scope of the project: national vs. local participation • Level of engagement intensity: high-touch vs. low-touch • Type of research: digital vs. in-person • Proximity to the research area • Age of participants • Families vs. individuals • Number of participants • Cultural context • Technology usage • Mobility • Social structures • Engagement norms

26

RECRUIT CUSTOMERS TO OBSERVE EXPERIENCE

TOOL

PARTICIPANT MANAGEMENT CHART Keeping track of your research participants will help you stay organized during recruitment and during the research process.

NAME (FIRST, LAST)

PREFERRED CONTACT METHOD

PHONE NUMBER

ADDRESS

27

EMAIL

RESEARCH ACTIVITY

28

SHIFT STEP 3 OF 6

GAIN DEEP UNDERSTANDING OF CUSTOMER EXPERIENCE

Understanding the customer experience involves learning what people do and why they do it. Traditional market research often does not explore customers’ values, behaviors, and decision-making processes. However, markets do not hire products and experiences—people do. Human-centered research, including qualitative interviews and observations, involves going into the field to hear from people about their lived experiences and to see how they act in context. In order to truly understand the customer experience, it is important to leave behind your biases and assumptions when conducting human-centered research.

At a Glance • Adopt the right frame of mind and trade your world view for a beginner’s mindset—put yourself in the customer’s shoes.

• Develop research assets based on the types of activities that you will conduct. These assets should allow the customer to share their story in their own words.

• Confirm logistics and build rapport with participants. Participants should understand and be comfortable with the research process.

29

GAIN DEEP UNDERSTANDING OF CUSTOMER EXPERIENCE

BIF Tips • Consider the pros and cons of individual interviews, group interviews, expert interviews, and observations.

• Building rapport is key to gaining the participants’ trust. When they are comfortable with you, they will open up more about their experiences.

• Maintain flexibility in your research. Understand that you may need to shift or change your research plan based on customers’ circumstances.

• How you ask a question is as important as the question itself. Avoid leading questions, and do not be afraid to keep digging to uncover the why.

• Capture your learnings or thoughts quickly after performing a research activity to ensure insights are not lost.

30

GAIN DEEP UNDERSTANDING OF CUSTOMER EXPERIENCE

Understanding Customer Experience When conducting human-centered research, you are trying to uncover the experience of the customer, not validate a predetermined solution or mine for product features. Your job is to create the space for people to share their life experiences with you. This might seem daunting, but you can always practice asking interview questions or performing observations with colleagues or others before meeting with your research participants. You can also conduct less formal interview methods at the beginning of your research, such as having quick conversations with your customers before scheduling formal meetings.

There are two main aspects of gaining an understanding of the customer experience: Begin Research: There are many different ways to understand the customer. No matter the methods you choose, building a relationship with customers is more important than adamantly holding to your research plan.

Run Research: Let customers help lead the research to show what is most important to them in their experience.

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GAIN DEEP UNDERSTANDING OF CUSTOMER EXPERIENCE

GUIDE

STARTER RESEARCH Here are some ideas for quick ways to gather initial information that can help you shift your perspective, or if you are struggling for new ideas and perspectives.

You can do these activities on your smartphone or computer when you have a free minute during your day.

DEVELOP KEYWORDS

First, break your research into a few different keywords. (E.g. Your challenge: “Exploring how to foster differentiation and personalized learning by thinking about the whole child”; Keywords: “differentiation”, “personalized learning”, and “whole child learning”) CONDUCT A TWITTER SEARCH

Use your keywords to conduct a Twitter search. Send a quick tweet to the first 10 individuals you find on Twitter whose interests match the keywords, read through their Twitter feed to see if there is anything of interest, and ask them to share any helpful resources with you. You can also pose one of your research questions to them directly.

CONSULT FRIENDS AND FAMILY

Pick someone from your contacts who is not part of your industry, and send them a text or email asking them what they think of your keywords. You may have to provide some context, but tell them that you are wondering if they have any thoughts or insight on the topic. Tapping into their knowledge may broaden your perspective on the topic.

CONDUCT A VIDEO SEARCH

Enter your keywords into a YouTube search and see if any relevant videos come up. You may have to sift through some irrelevant content first, but you may also find a helpful resource that gets you thinking. You might find a relevant example, an interview with a key player in the field you are exploring, or a funny video related to the topic that makes you laugh. Either way, it is a few minutes that helps to shift your perspective about your design challenge.

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GAIN DEEP UNDERSTANDING OF CUSTOMER EXPERIENCE

GUIDE

TYPES OF INTERVIEWS Interviewing people is a way to deeply understand the customer experience.

Think about it as uncovering the “why” behind customer behaviors. Consider these different types of interviews when planning your interviews with participants.

We suggest using a mix of methods so you can listen to what people think as well as see what they do. Try a few different ones to get a sense of the value each provides.

INDIVIDUAL INTERVIEWS:

Engaging people one-on-one for in-depth conversations. Good for: • Discovering the thoughts, feelings, emotions, attitudes, motivations, and aspirations of each person • Establishing rapport with each person to gain more open, honest perspectives GROUP INTERVIEWS

Engaging multiple people around a topic. Good for: • Learning about a culture or a group through their interpersonal dynamics • Providing a platform for many voices to be heard EXPERT INTERVIEWS:

Engaging those who already have deep knowledge of the subject. Good for: • Building context around how a system works, including: the history of the system, the effect of new technologies, and the possible cultural, sociological, and regulatory implications of changing the system • Helping stakeholders feel like they are part of the process • Enhancing other empathic approaches Please note that we did not include surveys in our methods guide. They can be used as a supplement to some of these other methods, but in general, they don’t provide the quality and depth of information that foster breakthroughs in insight.

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GAIN DEEP UNDERSTANDING OF CUSTOMER EXPERIENCE

GUIDE

CONDUCTING INTERVIEWS 01. SET UP MEETINGS

Contact the specific people that you would like to engage to set up a time for a meeting. Give a quick elevator pitch about your project to give them background on why you would like to learn from them.

Let them know ahead of time how many people will be attending, and whether you are planning to record them in any way.

02. DEVELOP INTERVIEW GUIDES

Interviewing is about actively listening so you can ask the best questions for the context. Being present in the conversation and asking follow up questions will yield more thoughtful answers. In order to do this, develop a semi-structured question list that will help guide you through interviews but also will allow you to steer the conversation in different directions as new topics or points of interest arise.

03. PRACTICE INTERVIEW QUESTIONS

Before going out into the field with participants, practice your interview questions with your team or colleagues to get more comfortable with the process. This gives you a chance to test your questions to see if they make sense to people in an interview setting.

04. PREPARE SELF-DOCUMENTATION ACTIVITIES (IF NEEDED)

User self-documentation activities act as a supplement to an interview. If your team chooses to incorporate self-documentation activities, think about what you would want to learn: • For behaviors, habits, and routines, try a journaling activity • For attitudes, beliefs, and emotions, try a collaging exercise where participants choose images that represent how they feel about something (e.g. “What images describe what is important to you about teaching?”)

Make sure the instructions are clear, and check in with the person to make sure they have completed the activity before your interview, if the activities are meant to be completed prior to the interview and be discussed during the interview.

05. PREPARATION FOR INTERVIEWS

For each interview, designate 1 person to lead, and another to take notes. If you intend to take photos or video, you may need a third team member to do this. Having 2-3 people in each session ensures that your team is supported without overwhelming the person you are engaging.

06. EXPLORATION DEBRIEF

Record key learnings from observation or shadowing. Include main themes and learnings, and new questions or topics to explore. Make notes of what mattered most to the participant, and anything they said or did that surprised you.

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GAIN DEEP UNDERSTANDING OF CUSTOMER EXPERIENCE

GUIDE

INTERVIEW TIPS Below are a few tips for when you are conducting your interviews. After each interview, you should take 15 minutes to write up the key takeaways while they are fresh in your mind.

•

TRY TO Build rapport with your interviewee.

•

Ask open-ended questions instead of closed questions.

•

Allow for pauses—sometimes silence is a great way to prompt people to reflect on what they have said so they can go deeper.

•

Watch for physical or emotional signals.

•

Ask follow-up questions, especially ones that get at the deeper “why”.

•

Ask clarifying questions if something is not clear or if there are inconsistencies.

•

Encourage stories around specific experiences or instances.

•

Use active listening.

•

Thank them for their time.

•

Take a few minutes to jot down top-of-mind learnings and thoughts after each interview.

•

Ask leading questions.

•

Let your questions ramble or trail off.

•

Rush to get to the next question.

•

Interrupt with acknowledgments, confirmations, or “uh-huhs”.

•

Interject your views.

TRY NOT TO

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GAIN DEEP UNDERSTANDING OF CUSTOMER EXPERIENCE

GUIDE

CRAFTING INTERVIEW QUESTIONS Like interview methods, there are various types of questions you can use to get at different aspects of an experience. Use the following framework to craft your conversation.

TYPE OF QUESTIONING

EXAMPLE

Task

Can you show me how you would create a lesson plan?

Demonstration

Show me how you would advise someone to use this web tool.

Role-Playing

I’ll be the student and you be the advisor; show me how you would respond.

Sequence Walk me through a typical day at your school.

Specific Example

What did you change based on your last assessment?

Project Ahead/Look Back What do you think teaching will be like in 5 years? How has it changed from __----------------------------------a year ago?

Peer Comparison

How do other teachers do it?

Exhaustive List

What are all the things you use when you create a lesson plan?

Remember to avoid closed-ended questions that only allow for yes or no responses. Open-ended questions give the person the opportunity to provide lengthier and more thoughtful responses.

Try to avoid

Try to use

CLOSED-ENDED QUESTIONS

OPEN-ENDED QUESTIONS

Do you collaborate with other teachers?

How do you collaborate with other teachers?

When you are giving feedback to students, do

When you are giving feedback to students, what

you like to use online tools such as Edmodo, or

methods, approaches, or tools do you use?

do you use other websites or...?

Would you say this tool is better than another

What do you like about this tool? What could be

online tool?

better?

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GAIN DEEP UNDERSTANDING OF CUSTOMER EXPERIENCE

GUIDE

OBSERVATIONAL RESEARCH TECHNIQUES Observing people is about witnessing firsthand how they interact in an experience. Observational research enables you to get a deep view into a person’s life without having to ask many questions.

OBSERVATION:

Observing people in context. Good for: •

Getting an unbiased view into what people actually do, rather than what they say they do

•

Seeing how people “work around” a challenge

•

Gaining insight into the flow of activity within a setting, such as mapping the path of children at an amusement park, or observing people’s use of technology in a coffee shop

SHADOWING:

Gaining perspective by following people through their day-to-day lives. Good for: •

Blending the values of observation and interview

•

Gaining insight into the motives guiding certain decisions or behaviors as they are happening

PARTICIPANT SELF-DOCUMENTATION (COLLAGING, JOURNALING):

Letting people frame and record their own experiences for you. Good for: •

Learning from people when you can’t interview or observe them directly

•

Giving people valuable prep-work for an interview

•

Tracking patterns in habits, such as journaling about an experience over a period of time (i.e., daily diary of adapting a lesson plan)

•

Having a collection of a person’s experience (photos, videos, notes) without having to intrude

•

Gaining insight into deep-seated attitudes, motivations, or beliefs though projective techniques (i.e., having a teenager create a collage that reflects her self-image)

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GAIN DEEP UNDERSTANDING OF CUSTOMER EXPERIENCE

GUIDE

PREPARING FOR OBSERVATION/SHADOWING Observing or shadowing people is about witnessing how they experience your design challenge. Think about it as uncovering the “how”. Here’s what you need to know about observing or shadowing people.

01. DECIDE WHEN AND WHERE

Based on your research plan, select situations, events, environments, and people that you want to observe in order to learn about your customer and the system in which they interact.

Make the necessary arrangements for conducting your observations (e.g. arranging to shadow a colleague through parts of their day or getting permission from a store owner to observe people in a café).

02. PREPARE OBSERVATION/SHADOWING GUIDES

Describing what you see, instead of interpreting it, is the most important thing to keep in mind while observing or shadowing. Refer to the Observational Notes section to focus on what you are observing.

03. PREPARE FOR OBSERVATION SESSIONS

For each observation or shadowing session you have planned, have two interviewers present, both taking notes. Each person may focus on something completely different than the other in their observations, and it is important to capture these unique thoughts. If you intend to take photos or video, you may need to include a third team member.

04. OBSERVE/SHADOW PEOPLE

You’re ready to go out and learn! We call this “going into the field.” See the tips section for a few things to keep in mind while you are in the field.

05. EXPLORATION DEBRIEF

After each session make sure to record key learnings from observation or shadowing. Include main themes and learnings, and new questions or topics to explore. Make notes of what mattered most to the participant, and anything they said or did that surprised you.

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GAIN DEEP UNDERSTANDING OF CUSTOMER EXPERIENCE

GUIDE

OBSERVATIONAL RESEARCH TIPS Below are a few tips to keep in mind when you are observing or shadowing people. After each encounter, you should take 15 minutes to write up the key takeaways while they are fresh in your mind.

TRY TO •

Describe what you are seeing in detail as it is happening, even if you do not know why or what the importance of the observation will be.

•

Look for how people may work around a particular challenge.

•

Try to be as inconspicuous as possible—if shadowing, ask the person to do things as they would if you were not there.

•

Record time periodically throughout note taking to make it easier to revisit events later.

•

If you can, title observations as you go (e.g. “ordering pizza”, “arrival”, “waiting in line”).

•

Observe body language and gestural cues to add context to an event (e.g. “woman looks confused”, “man peers down an aisle”).

•

If you can, take photos of specific events that represent the experience you observe.

•

Take a few minutes after observing or shadowing to jot down key learnings and thoughts.

TRY NOT TO •

Interject often, it’s okay to ask some clarifying questions but this is not an interview.

•

Get overwhelmed with information overload—just take note of what you can.

•

Think that you are not seeing anything new—keep looking and you will find new information.

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GAIN DEEP UNDERSTANDING OF CUSTOMER EXPERIENCE

GUIDE

OBSERVATIONAL NOTES (AEIOU FRAMEWORK) While you are observing, there will be a lot going on, which can feel overwhelming. Remember that you are just there to capture what is going on, not to add your interpretation. To ensure your attention is evenly hovering between different aspects of the activities and environment during your observations, you can use the following framework to focus your note-taking.

There are a few different ways you can structure your note-taking. You can center your note-taking around activities (A), and describe the subsequent elements (EIOU) that correspond with the activity. Or you can write your notes in a narrative format, while being attentive to all the elements (AEIOU).

• A = Activities are goal-directed sets of actions. Take note of the specific activities that people are doing.

• E = Environments are the spatial elements where activities take place. Take note of how people are using the space, the space’s function in the experience, and the function of the space.

• I = Interactions are between a person and someone or something else. Take note of routines and special interactions between people and/or objects.

• O = Objects are building blocks of the environment. Take note of objects that are present including what are being used and not used in the environment - and how they relate to the activities that are happening.

• U = Users are the people who are involved in the activity. Describe who they are, the roles they play, and the relationships they have.

Example of a structured form observational note: Activity:

Paying the bills

Environment:

Kitchen table

Interaction:

Cynthia takes out a pile of opened envelopes from a binder on table

Pulls up spreadsheet on her computer titled “Jones_bills_2012”

Starts with “Verizon” row, finds Verizon bill & enters total fee

Puts bill on right side of computer, making new pile

5 year old daughter, Hayley, asks for ice cream

Cynthia finishes up that row, gets up, gets her ice cream & turns on TV

When done, calls Mike to let him know they are over the monthly budget

Objects:

Table, binder, opened bill envelopes, chair, cell phone

Users:

Cynthia, Mike, Hayley

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GAIN DEEP UNDERSTANDING OF CUSTOMER EXPERIENCE

TOOL

NOTES & OBSERVATIONS WORKSHEET Record any notes and observations from your research.

DATE: MEETING & PARTICIPANTS: RESEARCHER(S):

NOTES:

What do you hear? What stands out to you?

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GAIN DEEP UNDERSTANDING OF CUSTOMER EXPERIENCE

TOOL

EMPATHY MAP Fill in this map to help you understand and articulate the customer experience.

WHAT DO YOUR CUSTOMERS...

HEAR?

THINK & FEEL? WHAT REALLY COUNTS, FEARS AND ASPIRATIONS

WHAT FRIENDS, FAMILY, & COLLEAGUES SAY

SEE?

SAY & DO?

ENVIRONMENT & INTERACTIONS

BEHAVIORS, ATTITUDES, & APPEARANCES

PAINS

GAINS

FEARS, OBSTACLES, FRUSTRATIONS

WANTS/NEEDS, MEASURES OF SUCCESS

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GAIN DEEP UNDERSTANDING OF CUSTOMER EXPERIENCE

TOOL

EXPLORATION DEBRIEF WORKSHEET Use this sheet to record key learnings from your research activities.

DATE:

TYPE OF ACTIVITY:

NAME OF PARTICIPANT(S):

RESEARCHER(S):

MAIN THEMES OR LEARNINGS THAT STOOD OUT:

THINGS THAT MATTERED MOST TO PARTICIPANT(S):

NEW QUESTIONS OR TOPICS TO EXPLORE:

THINGS THAT SURPRISED YOU:

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44

SHIFT STEP 4 OF 6

IDENTIFY KEY ACTIONABLE INSIGHTS

Now that you have gathered data from your human-centered research, you will synthesize and interpret the data and observations into themes and insights. Themes are a way to uncover the patterns seen across the data and make it more manageable to develop insights. Insights are statements that help you describe someone’s experience today in such a way that points to opportunities for the future. Insights are not just opinions; they are based on your research and are non-obvious, meaningful, and inspirational.

After you have developed insights, you will prioritize them and identify the key actionable insights that point to the main job the customer is trying to solve. The key actionable insights will illustrate opportunities for change and help additional stakeholders see what is important about the customer experience, viewed through a customer lens.

At a Glance • Bring your team together for a synthesis session to share data and observations from your research activities.

• Identify emerging patterns, connections, and relationships from the data you collected. Based on patterns and connections, group the data into themes.

• Translate the themes into insight statements that highlight something about the experience.

• Prioritize these insights in 5-7 key actionable insights that will guide your work.

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IDENTIFY KEY ACTIONABLE INSIGHTS

BIF Tips • Insights might be what you learned that surprised you in your research.

• Working out-loud can help you come up with insights you did not think of individually.

• Test themes by grouping and regrouping multiple times. Be careful not to make the themes too specific or too broad, so there are not too few or too many ideas in a grouping.

• Invite multiple analysts, such as peers or advisors, as they might uncover different themes and develop new and exciting insights from the data.

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IDENTIFY KEY ACTIONABLE INSIGHTS

Identifying Actionable Insights Once research activities are complete, the collected data needs to be synthesized and turned into key actionable insights to make meaning of the customer experience. Your mind will likely be swimming with different stories from your research. Synthesizing your data into insights allows you to make sense of everything you have learned about the customer experience. Creating insight statements allows you to reflect and determine what is most important in order to help you create an actionable foundation for design.

Insights need to be authentic and be based on your data from research, not on assumptions or how you think the experience should be. Insights are non-obvious and reveal something valuable that is not seen at a surface level. Insights also reveal the deeper “why” behind customers’ behaviors, decision-making processes, and actions. You can use the following steps to get from data to insights: Data to Themes: Data is any unprocessed or semi-processed information gathered from research participants. The patterns, relationships, and connections in the data can be grouped together into themes in order to make further sense of the present information.

Themes to Insight Statements: Themes become insights when you answer the question, “So what?”

Prioritizing Insights: By the end of analyzing, synthesizing, and interpreting your data, you should have 5-7 key actionable insight statements that bring your design challenge into focus and point to the main job the customer is trying to solve.

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IDENTIFY KEY ACTIONABLE INSIGHTS

GUIDE

GETTING TO INSIGHTS DATA TO THEMES

Data is any unprocessed or semi-processed information gathered from research participants. It can take the form of field notes, survey responses, interview transcriptions, statistics, or any other type of information that does not contain an explanation for a behavior or experience. Data can be qualitative or quantitative. The patterns, relationships, and connections in the data can be grouped together into themes in order to make further sense of the present information.

THEMES TO INSIGHT STATEMENTS

Now that you have grouped similar data points to find patterns, you can use a variety of different frameworks to help you interpret those patterns. Themes become insights when you answer the question, “So what?”

Use the following questions to help you re-frame patterns into insights: • What do these patterns mean?

• Why are they important?

• Why are they occurring?

• What are the implications on your design challenge?

When you’ve landed on a general statement that describes the implication of the pattern on your design challenge, write it above the group. This will serve as the insight statement for that group. Keep going until your team has an insight statement for each pattern you’ve uncovered. You may want to add a short description to each insight so someone outside the team would be able to understand the insight and its impact on your design challenge.

PRIORITIZING INSIGHTS

By the end of analyzing, synthesizing, and interpreting your data, you should have 5-7 key actionable insight statements that bring your design challenge into focus and point to the main job the customer is trying to solve.

Example of Insights from Data themes: Data (Quotes and Observations)

Insight Statement

Theme: Trusted Relationships

“I want to grow from feedback, but I’m looking for a non-judgmental place for help.”

“Friends Moments” with teachers

Teachers need trusted relationships to deliver feedback that is valued.

“I value personal relationships with people who know me well enough to provide personal feedback.”

Personalized feedback from sources that know the teacher well is important.

used to share, listen, and reflect on others’ issues-without expectation of action.

Theme: Personalized Feedback

“Different teachers in different

places have different needs. The administration’s role should be to help teachers identify those needs.”

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IDENTIFY KEY ACTIONABLE INSIGHTS

TOOL

OBSERVATIONS TO INSIGHTS WORKSHEET Use this framework to help make sense of your data and turn them into key insights.

DATA

THEMES

INSIGHTS

KEY INSIGHTS

WHAT DID YOU SEE OR HEAR?

WHAT PATTERNS ARE YOU FINDING?

WHAT DOES THIS MEAN?

WHAT ARE THE KEY ACTIONABLE INSIGHTS?

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50

SHIFT STEP 5 OF 6

IDENTIFY KEY JOB-TO-BE-DONE

All customers have a job-to-be-done and they hire products and services to accomplish or solve that job. A job-to-be-done is not an activity or a task, rather it is a description of the fundamental problem a customer is trying to solve. As Theodore Levitt states, “People don’t want a quarter inch drill, they want a quarter inch hole.” Customers may have several jobs that your organization could address, but determine one key job that has the biggest impact in customers’ lives, is feasible for the company, and is broad enough to allow for various solutions. The key job-to-be-done provides the foundation to create innovative and transformational opportunities to solve for this job.

At a Glance • Review the key actionable insights and develop several jobs-to-be-done that highlight the fundamental problems your customer is trying to solve.

• Prioritize all of the jobs-to-be-done based on impact and feasibility.

• Define the high-level key job-to-be-done that the customer is trying to solve.

This high-level job may encompass and end up solving for additional jobs.

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IDENTIFY KEY JOB-TO-BE-DONE

BIF Tips • A job-to-be-done is a description of what the customer is trying to do or the fundamental problem a customer is trying to solve.

• Jobs-to-be-done should describe some aspect of the user experience, which could be social, emotional or functional.

• Choose one job-to-be-done that you can move forward with. Do not be afraid to change it if it does not resonate with customers.

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IDENTIFY KEY JOB-TO-BE-DONE

Getting to the Job-to-be-Done Identifying the key job-to-be-done is important to keep your team aligned towards transformation, and to keep the customer and their needs at the center of your work. In order to move forward in designing a new model you must focus on the job with the greatest impact on the customer and not be constrained by your current offerings. Choosing a job-to-be-done that you are able to solve for with your existing business model is going to limit your ability to create transformational opportunities and new value for your customer and organization.

The job-to-be-done should not come from assumptions around what you think the customers need or want; it should be based on the data and insights you cultivated during the Shift phase. The job-to-be-done that you choose might shift or change as you test it with customers or start designing the conceptual model. That is okay. Initially focus on creating a working job-to-be-done—a simple statement that accurately captures the customer’s needs. You can use the following steps to get to a single job-to-be-done: Review Insights: Revisit the key insights that were developed based on your understanding of the customers.

Brainstorm Multiple Potential Jobs: Jobs can be functional, social, or emotional.

Evaluate and Determine Key Job-to-be-Done: You should have one key job-tobe-done to focus your team on the main job the customer is trying to solve.

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IDENTIFY KEY JOB-TO-BE-DONE

GUIDE

GETTING TO A JOB-TO-BE-DONE A job-to-be-done is a description of what the customer is trying to do or the fundamental problem a customer is trying to solve. Jobs can be:

• Functional: a specific task or problem (e.g. eating healthy meals) • Social: relating to how they are perceived by others (e.g. being seen as trendy) • Emotional: seeking a specific state (e.g. feeling secure in their job) Revisit the key insights that were developed. Based on the current customer experience, consider and record the possible jobs that the customer is trying to get done.

PRIORITIZING JOB-TO-BE-DONE BY IMPACT AND FEASIBILITY

Plot the possible jobs-to-be-done on an Impact vs. Feasibility matrix using the hypothesized impact the job will have for a customer and how feasible the job would be for the company to solve for.

Review the jobs plotted in the diagram to understand how they relate to one another, and consider how one key high-level job might be able to solve multiple jobs.

This matrix can help determine which jobs can be solved by a solution that the company offers versus those which are totally outside of the company’s control. You should not choose a job-to-bedone that is at either end of the spectrum but instead find the sweet spot in the middle. The greatest opportunities for innovation will be the jobs-to-be-done that are both potentially feasible for the company and have the largest impact on a customer’s life.

Example of Job-to-be-Done statements: •

Business Innovation Factory: “I need to explore, test, and commercialize next practices and new business models.”

•

Facebook: “I want to stay in touch with people I like even though our in-person lives don’t currently intersect.”

•

Lawnmower company: “I want to maintain my home’s curb appeal.”

•

Milkshake company: “On a long boring commute, I want something to keep my extra hand busy and to make the commute more interesting.”-Clayton Christenson

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IDENTIFY KEY JOB-TO-BE-DONE

TOOL

INSIGHTS & KEY JOB-TO-BE-DONE WORKSHEET Customers may have several jobs that your organization could address. Determine one key job that has the biggest impact in customer’s lives, is feasible for your organization, and is broad enough to allow for various solutions. A JTBD provides a foundation to create transformative opportunities to solve for this job.

KEY ACTIONABLE INSIGHTS

Identify the key actionable insights of the customer experience.

JOB-TO-BE-DONE

Job-to-be-Done (JTBD) - a JTBD is a description of what the customer is trying to do or the fundamental problem a customer is trying to solve. Customers hire experiences to accomplish their JTBD.

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SHIFT STEP 6 OF 6

DEVELOP STORYTELLING ASSETS TO ENGAGE STAKEHOLDERS

Storytelling is an essential innovation tool that connects, inspires, provides evidence, personalizes, and persuades. Through storytelling, you can enlist others in the change, gather supporters, create partnerships, and source funding. Stories can take various forms such as presentations, pitches, reports, videos, visual frameworks or websites.

Storytelling is a powerful way to pull people into the innovation process and create the will to invest in transformational change. Stories should create an emotional connection with the audience and should tell the experience through the lens of the customers, not the organization. Once the Shift phase is complete, you should utilize all components of the Shift phase to craft a narrative that integrates the process, findings, insights, and job-tobe-done into a compelling story.

At a Glance • Determine the audience and the goal of the storytelling asset.

• Review your process, findings, insights, and job-to-be-done and determine how they might be combined together into a compelling story.

• Determine the best form for the story to take (i.e. presentation, website, film, etc.).

• Formulate the story’s narrative and create the storytelling assets.

• Share the story about the customer experience with key stakeholders.

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DEVELOP STORYTELLING ASSETS TO ENGAGE STAKEHOLDERS

BIF Tips • You do not need to be an expert in technology platforms to craft a compelling story; there are many tools available to help create them.

• As you begin crafting your story, consider the arc of the journey. All stories should have an opening, conflict, and closing. The story should be simple yet compelling.

• Whenever possible, allow the customer to tell the story in their own words.

• When you are crafting a story, consider the primary audience and what they need to know.

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DEVELOP STORYTELLING ASSETS TO ENGAGE STAKEHOLDERS

Sharing your Transformation Story Storytelling is one of the oldest forms of communication; it binds us together as humans through our shared experiences. Transforming anything requires high levels of personal engagement, and people need to see themselves in the transformation story and feel that they can contribute to it before they will fully engage. It is imperative to package and share your understanding of the customer experience, discovered in the Shift phase, in order to enlist others to support and engage in the transformation process. To successfully share your story you should: Collect Storytelling Material: Collect storytelling pieces throughout the Shift phase, such as videos from interviews and observations or physical evidence from your engagements.

Tailor Your Story to Your Audience: Determine the core audience for the story: who do you want to engage and what do you want them to learn?

Sketch the Story Arc: Clearly frame the key actionable insights and key job-tobe-done within your story, while providing context that backs up your findings and makes it relatable to the audience.

Choose Your Story Format: Storytelling formats include presentations, research reports, videos, audio deliverables, internet-based platforms, and physical representations.

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DEVELOP STORYTELLING ASSETS TO ENGAGE STAKEHOLDERS

GUIDE

CRAFTING YOUR STORY COLLECT STORYTELLING MATERIAL

If possible, collect storytelling pieces throughout the Shift phase, such as videos from interviews and observations or physical evidence from your engagements. The more you collect during the process, the easier it will be to craft your final storytelling assets when you are done. It is also important to create these storytelling assets as soon as possible; the longer you wait after concluding your research, the harder it will be to gather the necessary assets and craft the story.

TAILOR YOUR STORY TO YOUR AUDIENCE

Determine the core audience for the story: who do you want to engage and what do you want them to learn? Once you determine the audience for the story, inventory the type of data that you have collected and how you could explain your understanding of the customer’s experience to that audience.

The customer experience may be complex, but your goal in storytelling should be to make it easily understandable and to create an emotional connection with the audience.

Guiding Questions: When you are crafting a story, who will be the primary audience? Who should read or listen to your story? What do they need to know?

CHOOSE YOUR STORY FORMAT

The form your the story takes will be based on your audience and how many people you want to reach.

For example, an internet-based platform is better for reaching a wide external network of people, while a pitch deck might be more appropriate for telling the story to a smaller group of internal stakeholders.

The entire storytelling experience may encompass multiple story formats that work with each other, so the format(s) that prove to be most effective. Some storytelling formats include presentations, research reports, videos, audio deliverables, internet-based platforms, and physical representations.

SKETCH THE STORY ARC

Clearly frame the key actionable insights and key job-to-be-done within your story, while providing context that backs up your findings and makes it relatable to the audience. As you start crafting your story, put together what you know about your challenge. Be on the lookout for assumptions as well as holes in the story. Picture the journey you will be going on and write down the arc of the story:

• The opening: where you are starting • The conflict: the tension points • The closing: resolving the conflict with your idea

A GOOD STORY SHOULD BE SHORT AND TO-THE-POINT.

We recommend using the following framework to keep your story under five minutes:

• Outline your research goal • Identify key insights you learned • Share your key job-to-be-done • Include a call-to-action for others to support your work • Tell the audience where can they go to learn more

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DEVELOP STORYTELLING ASSETS TO ENGAGE STAKEHOLDERS

TOOL

STORYTELLING TEMPLATE Use this template to help craft a story about the user. You can use a single person’s story to share the experiences of many , MEET THE USER Describe the user, the main actor in the story

THEY NEED TO List the user’s job-to-be-done

THEY LIKE/DO NOT LIKE/BELIEVE Add more detail about the user’s behavior

THEY TEND TO Describe the user’s relevant behaviors

EXPERIENCE NARRATIVE Describe the user’s current experience: What is the setting?

What is happening?

What are the barriers?

How are they dealing with the barriers?

Have they created a work-around?

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P H AS E 2 O F 4 :

CONCEPTUAL DESIGN 62

PHASE 2:

CONCEPTUAL DESIGN TRANSLATE JOB-TO-BE-DONE INTO A VALUE PROPOSITION

IMAGINE A NEW CUSTOMER EXPERIENCE

ISOLATE THE LYNCHPIN CAPABILITIES

FILL OUT DETAILS OF PROCESS, PEOPLE, AND TECH

DEPICT HOW THE CAPABILITIES WORK TOGETHER

IDENTIFY POTENTIAL REVENUE STREAMS

IDENTIFY KEY COST DRIVERS

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KEY TERMS

Value Proposition: a short and easy-to-understand declaration of how an organization helps create value for customers by solving for their job-to-be-done.

Customer Experience: the holistic story or journey of how customers engage with the business model.

Conceptual Business Model: ideas around a model—including a value proposition, lynchpin capabilities, and financial assumptions—that have not been tested in the market.

Capability: the power or ability to do something in service of delivering the new customer experience. Capabilities are comprised of people, process, and technology.

Lynchpin Capabilities: capabilities critical to delivering the new customer experience and fulfilling the value proposition. Without these, you no longer have the customer experience you imagined. Lynchpin capabilities can be divided into core capabilities and enabling capabilities.

Core Capabilities: top 4-6 customer-facing capabilities.

Enabling Capabilities: top 4-6 imperative internal support capabilities.

Operating Model: a depiction of how lynchpin capabilities are networked together to deliver value; a shared view of how core and enabling lynchpin capabilities relate to each other.

Revenue Streams: who pays and for what in the experience to create the financial resources to sustain and scale the business model.

Cost Drivers: key costs to operate the new model including operating costs, working capital, and fixed capital.

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DESIGNING A CONCEPTUAL BUSINESS MODEL Once you have shifted your lens to see opportunities from the perspective of the customer, you can use design methods to begin imagining a new model to solve for the customers’ job-to-be-done. The goal of the Conceptual Design phase is to develop a high-level conceptual business model—grounded in the customer experience and job-to-be-done uncovered in the Shift phase—that can be quickly and iteratively prototyped with customers. A conceptual business model articulates how new value gets created, delivered, and captured by showcasing the lynchpin capabilities necessary to deliver the new customer experience and the cost drivers and revenue streams that contribute to capturing value for the business.

The Conceptual Design phase does not require you to spend months crafting every detail of the new model. By the end of the phase, you should have a draft model that you can prototype quickly with customers, with the intention of iterating toward what actually works in the real world. The assumptions around the high-level customer experience, capabilities, and economic viability are evaluated in the Prototype & Test phase.

The key to completing this phase is allowing yourself the freedom to imagine new ways of helping the customer accomplish their job-to-be-done. Worrying about scalability and change management considerations too early in the process can kill transformational ideas; doing so forces you to focus on incremental and predictable solutions that may seem safer, but will not protect you from being disrupted by a transformational competitor in the future. You should first design and iteratively test a new model in the market at a small scale to see how it functions and creates value before addressing how to scale and commercialize it.

The Conceptual Design phase results in a conceptual business model that describes how the new model will create, deliver, and capture value. The conceptual business model articulates the experience of fulfilling the value proposition, the capabilities essential for delivering the customer experience, and the potential financial impact of the model. Showcasing these elements in assets such as reports or visual decks will help you share the business model story and process with key stakeholders.

It is important to document your ideas but do not over analyze or get too attached; the conceptual business model is only a representation of an idea that has yet to be realized. The business model will evolve and become more concrete as all of its components are tested together in a prototype to determine which components are most essential.

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BUSINESS MODEL:

The logic for how an organization creates, delivers, and captures value.

BUSINESS MODEL INNOVATION:

Working in a space adjacent to the current model to explore next practices and new models, and testing them in the real world.

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CONCEPTUAL DESIGN CONTENT Create Value 1. TRANSLATE JOB-TO-BE-DONE INTO A VALUE PROPOSITION Job-To-Be-Done to Value Proposition Value Proposition Worksheet 2. IMAGINE A NEW CUSTOMER EXPERIENCE Developing Design Principles Identifying Opportunity Areas Brainstorming Tips Brainstorm Prep Brainstorming Creativity Interventions Evaluating Brainstormed Ideas Articulate the New Customer Experience Three-Stage Experience Map Concept Summary Deliver Value 3. ISOLATE THE LYNCHPIN CAPABILITIES Brainstorming Capabilities Lynchpin Capabilities Worksheet 4. FILL OUT DETAILS OF PROCESS, PEOPLE, AND TECH Outlining Capability Details Capability Details Worksheet 5. DEPICT HOW THE CAPABILITIES WORK TOGETHER Creating an Operating Model Capture Value 6. IDENTIFY POTENTIAL REVENUE STREAMS Identifying Revenue Streams Types of Revenue 7. IDENTIFY KEY COST DRIVERS Identifying Cost Drivers Capture Value Worksheet

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CONCEPTUAL DESIGN STEP 1 OF 6

TRANSLATE JOB-TO-BE-DONE INTO A VALUE PROPOSITION

The customer remains at the core of your model as you use your understanding of their experience to translate the job-to-be-done into a value proposition. The value proposition is a short and easy-to-understand promise to the customer that describes how you will solve their key job-to-be-done. The value proposition describes the benefits that customers can expect from your services and differentiates you from your competitors. It creates a north star for your team, helping you align and mobilize around developing impactful customer experiences.

At a Glance • Re-frame the key job-to-be-done into a promise to the customer.

• This promise to the customer becomes your value proposition.

• The value proposition should describe how you will help them accomplish their job-to-be-done.

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TRANSLATE JOB-TO-BE-DONE INTO A VALUE PROPOSITION

BIF Tips • Imagine you are the customer. Does the value proposition make sense to you? Is it clear and easy to understand?

• The value proposition should be broad enough to allow for transformational customer experiences that are unconstrained by the experiences the organization currently offers.

• It’s helpful to test your value proposition with customers before finalizing it.

• The value proposition needs to be rooted in the research from the Shift phase.

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TRANSLATE JOB-TO-BE-DONE INTO A VALUE PROPOSITION

Creating a Value Proposition To create a value proposition, you will need to convert the job-to-be-done from the customer lens to a statement about how your company promises to solve the customer’s job-to-be-done. Sometimes the task is as simple as shifting the language to reflect the new perspective; other times it may require more finessing to arrive at a strong and concise statement. The value proposition should not list nor include product or service offerings. Keeping the value proposition at a high level will enable you to explore more transformational solutions.

Create a Value Proposition: Convert the job-to-be-done from the customer lens to a statement about how your company promises to solve the customer’s jobto-be-done.

Test the Value Proposition: Using a small group of customers and stakeholders test the value proposition to gain their feedback and to help you refine it.

Focus on the Future: When crafting your value proposition, remember not to focus on your organization’s current ability to deliver on the promise; instead, focus on the value you desire to create for customers in a future model.

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TRANSLATE JOB-TO-BE-DONE INTO A VALUE PROPOSITION

GUIDE

JOB-TO-BE-DONE TO VALUE PROPOSITION After determining the job your customer is trying to get done, you can begin to imagine new ways to create value for your customer.

A Value Proposition is a promise to the customer that describes how an organization creates value for customers by solving their job-to-be-done.

A Job-to-be-Done is a description of what the customer is trying to do or the fundamental problem a customer is hiring the experience to solve. Customers hire experiences to accomplish or solve their job-to-be-done.

Examples ORGANIZATION

JOB-TO-BE-DONE

VALUE PROPOSITION

Business Innovation Factory

“I need to explore, test, and commercialize next practices and new business models.”

We help make transformation safer and easier to manage for institutional leaders.

Facebook

“I want to stay in touch with people I like even though our in-person lives don’t currently intersect.”

We provide a way to engage with your own networked community.

Lawnmower Company

“I want to maintain my home’s curb appeal.”

We help you achieve beautiful landscaping.

To construct your value proposition, consider:

• What is your target market? What customers are you trying to reach through your value proposition? Make sure you know who the customer is before you construct your promise to them.

• What is the primary benefit provided to the customer in solving their job-to-be-done? The promise that you make needs to solve this job.

Combine these elements together to craft a compelling statement that speaks to the customer about how you are solving their job.

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TRANSLATE JOB-TO-BE-DONE INTO A VALUE PROPOSITION

TOOL

VALUE PROPOSITION WORKSHEET Business models are designed to create value for the customer. The first place to start is to articulate how the model creates value and for whom.

Creating new value opens up opportunities for transformation.

VALUE PROPOSITION

Value Proposition - a promise to the customer that describes how an organization creates value for customers by solving their job-to-be-done. Capture your value proposition to the customer.

Concept Summary

Your concept summary is a brief description of the new experience. It’s the “what” of fulfilling your value proposition. Try to think from the customer’s perspective.

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CONCEPTUAL DESIGN STEP 2 OF 6

IMAGINE A NEW CUSTOMER EXPERIENCE

Imagining a new customer experience is the creative process by which you think of new ways to create value for the customer in order to fulfill the value proposition. Any new customer experience should be based on your understanding of the customer from the Shift phase, in order to create an experience that is relevant and desirable in customers’ lives.

Throughout this process, you will need to open your mind to new possibilities that are not constrained by the organization’s current offerings. As you brainstorm, include many different perspectives, provide time to reflect, and stretch your idea of what’s possible. Only when you have generated a sufficient number of concepts should you begin to evaluate them against a set of criteria in order to land on a single experience that you will incorporate into a conceptual business model and ultimately test in the real world.

At a Glance • Develop design principles based on insights formed about the customer experience; these are the foundation for determining the core aspects of any new customer experience.

• Brainstorm new ideas to fulfill the value proposition.

• Evaluate and prioritize ideas from brainstorming.

• Use your prioritized ideas to develop a single new customer experience.

• Articulate the high-level elements of the final customer experience in a way that can be shared with others.

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IMAGINE A NEW CUSTOMER EXPERIENCE

BIF Tips • Focus on the high-level customer experience, as this leaves the door open for different ways to deliver this experience.

• Consider how customers enter the experience, what happens during the experience, and what happens at the conclusion of the experience to create a holistic view.

• In this step, do not worry about details; instead, focus on the broad aspects of ideas.

• Do not be constrained by your organization’s current offerings.

• Do not latch onto or advocate for ideas before you have completed brainstorming.

• There are many ideas that will fulfill the value proposition, but you should move forward with just one customer experience to test and iterate in the market.

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IMAGINE A NEW CUSTOMER EXPERIENCE

Imagining a New Experience for the Customer Imagining a new customer experience involves exploring how to create new value for the customer. You will need to first brainstorm many different ideas, then prioritize and select ideas to develop a single integrated customer experience. Using design principles as your guide through this process will ensure any experience you create is centered on the customer. You will use the following process to arrive at a single customer experience: Develop Design Principles: It is important to develop design principles, based on your insights, to describe the elements the new experience needs to have in order to meet your customers’ needs.

Identify Opportunity Areas: After developing design principles, it helps to identify opportunity areas to help explore solutions to solve your customers’ jobto-be-done.

Brainstorm New Ideas: As you begin undertaking the brainstorming process, it is common to become attached to ideas that surface early; however, jumping to conclusions will limit your ability to think transformationally.

Prioritize and Select Ideas: Once you have brainstormed different ideas, prioritize the ideas and select the most promising concepts to be woven into a singular customer experience, which you will further design and prototype.

Articulate the Customer Experience: There are several tools you can use to make a new customer experience more tangible. It is important to get the experience out of your head and onto paper so you can think more deeply about the concept and can help others to understand and add to it.

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IMAGINE A NEW CUSTOMER EXPERIENCE

GUIDE

DEVELOPING DESIGN PRINCIPLES To generate design principles, use your insights as a way to imagine what the solution should provide in order to meet your customers’ needs.

Design principles should be:

• Short, simple, and memorable • Based on research from your exploration • Specific to your project • Cross-solution, so you can apply them to a range of possible ideas • Descriptive, so it is clear whether a solution is or is not aligning with the design principles Once you have 5-7 design principles, write a sentence or two for each design principle so anyone inside or outside the project can understand what it means. Design principles should follow the framework: “Any solution must…”

Example: Any solution must…

• Foster sustained engagement • Use storytelling to highlight change • Build communities that are supportive and safe

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IMAGINE A NEW CUSTOMER EXPERIENCE

GUIDE

IDENTIFYING OPPORTUNITY AREAS Opportunity areas are possible avenues in which to explore solutions to a customer’s job-to-be-done. Re-framing your insights into opportunity areas by translating them into generative questions can help your team imagine new customer experiences.

Using a “How might we…” format gives you the chance to develop a variety of solutions for each opportunity area. Your “How might we...” statements should allow for a variety of solutions; if they do not, you may need to broaden the framing. You can have several “How might we...” statements from a single insight statement. Your “How might we...” statements should give you a foundation to start brainstorming new customer experiences and room to explore wild ideas.

Examples

KEY ACTIONABLE INSIGHT:

OPPORTUNITY AREA STATEMENT:

Non-traditional students returning to college have a hard time getting back to appropriate study habits.

How might we support returning students in developing study habits?

When the process is complex or confusing people are likely to give up.

How might we simplify or streamline the process?

Positive social support often helps the healing process.

How might we foster health by developing better or different relationships?

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IMAGINE A NEW CUSTOMER EXPERIENCE

GUIDE

BRAINSTORMING TIPS Brainstorming is the creative generation of ideas by one or more individuals in an attempt to find a solution to a problem.

Brainstorming is a skill that you will use at several stages in the Design phase. It provides a venue for you to develop your craziest ideas and be heard without judgment; even the most impossible notions might beget a breakthrough. The outcome of your brainstorm relies on your imagination, and like any other skill, you get better with practice.

Here are some practices that will make you and your team more successful: CHOOSE YOUR BRAINSTORM GOAL

What are you trying to accomplish with your brainstorm? To come up with many new ideas or to build out a specific solution or idea?

THINK BIG AND OUT LOUD

Be free to think outside of the box. Nothing is too radical. It’s much easier to scale back a big idea than it is to try and build up a small one. You’ll find more inspirational solutions by being open.

BUILD ON OTHERS’ IDEAS

Your group will achieve the best results if you build on each others’ ideas. Don’t dismiss someone’s idea because it’s silly or “out there”; it may help inspire a fantastic solution. Instead, riff off an idea and see where else you can take it.

DON’T EVALUATE YET

Brainstorming helps you develop ideas you’ve been too busy or close-minded to think of before.

Evaluation will come later. For now, focus on generating big, crazy ideas. Try to tap into child-like play and creativity.

MORE IS MORE

Focus on generating as many ideas as possible. Set a goal for your team, like brainstorming 60 ideas in a half an hour! Move quickly, be concise when you share your ideas, and avoid spending time convincing others of your ideas.

DO IT ALONE OR TOGETHER

Brainstorming can be done on your own or with a group; both methods have benefits, depending on how you and your group like to work. Try going back and forth between coming up with ideas on your own and sharing.

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IMAGINE A NEW CUSTOMER EXPERIENCE

GUIDE

BRAINSTORM PREP Before you begin a brainstorming session, use the list below to make sure you’re prepared: ASSIGN A BRAINSTORMING FACILITATOR

Choose someone who is adept at reading the energy of the room and getting people to participate to lead the brainstorming session.

GATHER THE TEAM

Plan a time when all members of your team can meet. Consider including others that may have valuable input, especially those that see the experience from a different point of view. Include people who will build on ideas, not tear them down.

CHOOSE THE ENVIRONMENT

Choose a space that can accommodate all of your team members and encourages informality and creativity. The environment should have ample wall space for post-its or writing down ideas.

DECIDE ON THE TIMETABLE

Brainstorming ideas can happen over several hours or days. You will need to determine the right amount of time for your group. Be aware that it is easy to burn out, so agreeing on a set amount of time or number of generated ideas will help. We recommend at least half an hour for warm-up exercises and at least one hour for brainstorming.

PREPARE MATERIALS

Gather post-its, markers, larger sheets of paper, snacks, and anything else to facilitate the generation of ideas. Post your value proposition and design principles clearly on the whiteboard or wall, as they will help to inspire new solutions.

DECIDE ON DOCUMENTATION

Make sure to take some pictures of the brainstorming session or records ideas. These artifacts will be helpful to remember some ideas that your group had and to provide visuals to tell the story.

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GUIDE

BRAINSTORMING CREATIVITY INTERVENTIONS If creativity is stalled during brainstorming, try using one of the techniques below.

ROADBLOCK REMOVAL

Eliminate assumed constraints. Tell the group there is no limit on costs, or time, or other resources.

They can think as big or expensive as their minds allow. Removing a roadblock might free new ideas that would not have been considered otherwise.

BREAK THE RULES

Take the opposite approach as the roadblock removal. Rather than ignoring the idea’s constraints, list the barriers and generate ideas for how to break through them.

PROVOCATION

Eliminate elements of the challenge that are taken for granted. Posing outrageous statements forces you to think in different and original ways. For example, you could ask: “What if classrooms had no desks? What if there were no principals?”

OPPOSITE EXPERIENCE

Get the group to describe the opposite of what you want to have happen and then, at the peak of the discussion, shift gears back to what you do want. You might say something like: “Okay. We know what we don’t want. How do we achieve the opposite of this?”

BRAINWRITING

Have each person write down or sketch a beginning of an idea on a piece of paper. After 2 minutes, everyone passes their piece of paper to their neighbor, who continues to build on the idea. This process is repeated until the piece of paper gets back to its originator. Once complete, each person shares the results and the ideas get added to the list.

RANDOM IDEA GENERATOR

Choose a random concept and think about how you could apply it to a solution for your value proposition. For instance, you might consider how a dog walker might inspire solutions for personalized learning for students, or how a peanut factory might inspire solutions for increasing teacher collaboration.

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IMAGINE A NEW CUSTOMER EXPERIENCE

GUIDE

EVALUATING BRAINSTORMED IDEAS After you’ve brainstormed ideas and clustered ideas into themes, use one of the following methods, or a mix of a few, to prioritize your ideas and identify those that are the most promising to combine into a singular customer experience.

TAKE A VOTE

• Give each person three post-it notes or colored dots, representing their votes.

• Have everyone put their votes on the three ideas they think are most promising.

• After everyone votes, further evaluate the top ideas as a team.

FEASIBILITY X IMPACT MATRIX

• On a whiteboard or paper, draw intersecting X- and Y- axes to create a 2x2 matrix. The X-axis is a spectrum from low to high of the potential impact an idea might have for users. The Y-axis is a spectrum from low to high of how difficult an idea would be to implement.

• Organize the ideas you’ve generated within the matrix. Move the post-its along the two axes depending on their potential impact and difficulty.

• Change the axis to measure your ideas in different ways.

DESIGN PRINCIPLE RATING

• Create a rubric table, with your ideas at the top and the design principles along the left side.

• As a team, give each idea a score for how well it meets each of the design principles:

• Score of 1 = somewhat satisfies; Score of 2 = satisfies; Score of 3 = strongly satisfies.

• Add up the total scores for each idea to prioritize the ones with the highest score—those that best meet your users’ needs.

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IMAGINE A NEW CUSTOMER EXPERIENCE

GUIDE

ARTICULATE THE NEW CUSTOMER EXPERIENCE How you represent the new customer experience is just as important as coming up with transformational ideas; you can’t create change without communicating your concepts. You can use the following formats to communicate your ideas to others.

You can use the following formats to communicate your ideas and share your new customer experience with others. Getting your idea out of your head and onto paper will also help you better understand the new customer experience you imagined.

CONCEPT SUMMARY

A framework for articulating the details of a concept. It includes the title of a concept, a one-sentence summary, a brief description of how the concept will work, and an end goal of how the concept will create impact. The concept summary tool is a way to simply and easily communicate the new experience.

STORYBOARD

Storyboarding helps you illustrate and articulate how a concept might function in the real world using narrative and basic visualizations. When designing a storyboard, illustrate the story of how the customer enters, engages with, and exits the experience. Creating storyboards helps you validate your ideas and think in realistic terms about how people would interact with the experience.

JOURNEY MAP OR SERVICE BLUEPRINT

A journey map or service blueprint characterizes the journey someone takes over time as they interact with a company, product, service, or some combination of the three. It visually represents different touch points, which can be human, physical, or virtual. The map is personalized with individual insights, photos, quotes, successes, and failures of the journey. A good journey map will include the following: experience phases and touchpoints, visual representations of the journey including activities and interactions, customers’ perceptions of highs and lows in the journey, and potential barriers and opportunities.

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TOOL

THREE-STAGE EXPERIENCE MAP Depicting the new customer experience helps deepen your understanding of a concept. Articulate the user experience or imagine the future experience people will have with your solution.

ENTER

ENGAGE

How do they become involved?

What happens once someone is in the experience?

What brings them into the experience?

What is the primary action or interaction?

How do people hear about the experience?

What is the main event?

How do they become excited about the new experience?

WHAT What is happening?

What is your user doing?

What does it feel like?

Describe the interaction.

WHO Who is your user or users?

Who plays supporting roles?

Who makes it happen?

Who do you need buy-in from?

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EXIT

How does the experience conclude?

What is the residual impact of the experience?

What happens after the experience to keep customers engaged?

IMAGINE A NEW CUSTOMER EXPERIENCE

TOOL

CONCEPT SUMMARY How you represent the new customer experience is just as important as coming up with transformational ideas; you can’t create change without communicating your concepts. You can use the following formats to communicate your ideas to others.

Title of concept

One sentence summary

Brief description What is the new concept or experience for the customer/user?

END GOAL How will the new concept or experience amplify impact?

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CONCEPTUAL DESIGN STEP 3 OF 6

ISOLATE THE LYNCHPIN CAPABILITIES

Once you have determined how you will create value for the customer in a new customer experience, you then need to figure out what capabilities you will need to deliver the new experience to customers. Capabilities are the power or ability to do something in service of delivering an experience for customers. Your new customer experience will require the ability to do many things, but there are several capabilities that are critical to delivering new value. These critical capabilities are called lynchpin capabilities; without them, you no longer have the customer experience you imagined. Lynchpin capabilities are composed of both core capabilities and enabling capabilities that support the core capabilities. Isolating the lynchpin capabilities and identifying whether they are core or enabling is important to determine how to successfully deliver new value to your customers.

At a Glance • Brainstorm the capabilities involved in delivering the new customer experience.

• Isolate the lynchpin capabilities that are essential to delivering the experience.

• Determine if the lynchpin capabilities are core (customer-facing) or enabling (supporting).

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ISOLATE THE LYNCHPIN CAPABILITIES

BIF Tips • Think broadly to cover everything that is needed to deliver the experience.

• Capabilities should not be static; they may change over time as the customer experience evolves in the prototype.

• Many companies share the same enabling capabilities; it is often the core capabilities that distinguish your experience from competitors.

• If a lynchpin capability does not already exist in your organization, it can be created by combining and recombining existing capabilities or sourcing external capabilities.

• Keep capabilities at the high-level of “We need the ability to…” and if your capability is a specific person or technology ask yourself “Why do we need this person or technology?”

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ISOLATE THE LYNCHPIN CAPABILITIES

Isolating Lynchpin Capabilities You must identify what the organization needs to be able to do in order to deliver the new experience to customers. Put aside your existing capabilities and departments, and focus on what is necessary to deliver the new value to customers. To begin this step, begin broad and think of everything that is required to take the experience into the real world.

You will have a long list of capabilities that need to be whittled down to determine the most important or relevant capabilities. Those capabilities may evolve during the prototype, so do not become too fixated on isolating or perfecting the lynchpin capabilities. Spending too much time obsessing over the lynchpin capabilities will keep you from getting to the prototype phase, where you will learn the most about the model. You should spend just enough time to help you decide what is important to test in the prototype.

Brainstorm Capabilities: To begin this step, begin broad and think of everything that is required to take the experience into the real world.

Be Open to New Ideas: Resist trying to fit or mold your capabilities into your existing model.

Identify the Most Important Capabilities: You will have a long list of capabilities that need to be whittled down to determine the most important or relevant capabilities.

Focus on the Goal of Each Lynchpin Capability: Focus on getting to a highlevel description of the goal of each lynchpin capability, how they help fulfill the value proposition, and whether you think they are core or enabling lynchpin capabilities. Testing will come later.

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ISOLATE THE LYNCHPIN CAPABILITIES

GUIDE

BRAINSTORMING CAPABILITIES Capabilities are the ability to do something that enables you to deliver the desired customer experience. Lynchpin Capabilities are the capabilities critical to delivering the new customer experience and fulfilling the value proposition.

Use the following steps to get to the lynchpin capabilities you will need to deliver the new customer experience: 1. To start, post the value proposition and the customer experience on a whiteboard or wall so your whole team can see it.

2. Brainstorm and write down everything the organization needs to be able to do in order to deliver the new experience for customers.

3. Cluster similar functions and articulate the underlying themes as capabilities, or the ability to do something (e.g. ability to track data, ability to track communication between employees). You may have brainstormed items with specific people or technology, but try to re-frame it into why you need that person or tool. This will help you determine what the capabilities are instead of what they might be comprised of.

4. Determine which capabilities are lynchpin capabilities, those essential to delivering the customer experience, and then whether they are core or enabling capabilities. Core capabilities are the top 4-6 customer-facing capabilities. Enabling capabilities are the top 4-6 imperative internal support capabilities.

To help you determine which capabilities are lynchpin, consider which are core to delivering the value proposition and which only play a secondary role. For instance, the capability to introduce a steady stream of new products and services may be core to value delivery, while the capability to ensure a steady supply of paper clips on every employee’s desk is certainly secondary. You should not have more than 10 lynchpin capabilities; if you do, reconsider if they are truly core to the new model.

For each lynchpin capability, develop an overview that contains the following information: • Name of the capability • Description of what the capability does and its outcome • Capability’s connection to the value proposition Lynchpin Capabilities of a Lemonade Stand In order to have a lemonade stand, we need the ability to: CORE LYNCHPIN CAPABILITIES

ENABLING LYNCHPIN CAPABILITIES

• Procure ingredients

• Continually improve

• Make lemonade

• Gain parent’s permission

• Create demand

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ISOLATE THE LYNCHPIN CAPABILITIES

TOOL

LYNCHPIN CAPABILITY WORKSHEET Depicting the new customer experience helps deepen your understanding of a concept.

We need a

We need the ability to...

Director of Marketing or Advertising

Attract Customers

Customer Relationship Management (CRM) System

Track Customers along their Paths

These are not capabilities, they are part of capabilities. The top one is a person or role and the bottom one is a technology.

These are capabilities. They are at the correct level to be made up of people/roles, processes and technologies.

BRAINSTORM POTENTIAL Lynchpin Capabilities "We need the ability to..."

Identify the lynchpin capabilities central to your customer experience.

Core Lynchpin Capabilities

Enabling Lynchpin Capabilities

These are central to the customer experience you imagined, and tend to be customer facing.

These are generally not customer-facing and support the delivery of the customer experience.

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CONCEPTUAL DESIGN STEP 4 OF 7

FILL OUT DETAILS OF PROCESS, PEOPLE, AND TECH

All capabilities are comprised of three elements: process, people, and technology. These elements work together to achieve the outcome of the capability. Processes connect the people and technology to produce the ability to do something. Some capabilities might not have all three elements and some might share elements with other capabilities. Determining the high-level details of people, processes, and technology for each lynchpin capability helps you determine how to organize around delivering the new customer experience.

Do not determine every role and responsibility of people or features of technology. Focus on the essential elements for each capability to achieve enough detail that you are able to make the experience tangible in a prototype. You will learn more about the details of the capabilities during the Prototype & Test phase.

At a Glance • Brainstorm all processes, people, and technology for each lynchpin capability. • Prioritize the processes, people, and technology that are most necessary to deliver value in the model.

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FILL OUT DETAILS OF PROCESS, PEOPLE, AND TECH

BIF Tips • Real-world use cases can provide context for determining the details of each capability.

• It is tempting to want to incorporate new technology in all capabilities, but consider if it is actually necessary.

• When considering people, think about the roles that need to be filled rather than the individual people and job titles.

• Each capability and its details should fit on one page; you do not need to create a detailed report for each capability.

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FILL OUT DETAILS OF PROCESS, PEOPLE, AND TECH

Filling out the Details Filling out details of process, people, and technology means determining the essential elements for each capability and achieving a level of description to be able to make the experience tangible in a prototype. While you may be tempted to dive deeply into each description and write pages of explanation, all you need to do is add one more level of detail.

Imagine the Details: Use cases based on the customer experience can help you imagine the details that comprise each capability. Capabilities will not always have all three elements of people, process, and technology, and often capabilities will overlap in people, processes, and technology.

Create Templates: The details of each lynchpin capability should fit in a one-page template. Constraining yourself in this way will keep you from overdesigning the capabilities and will ensure capabilities are at a level that everyone can understand and align around.

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FILL OUT DETAILS OF PROCESS, PEOPLE, AND TECH

GUIDE

OUTLINING CAPABILITY DETAILS The people/roles, processes and technologies are what make capabilities come to life. Once you have outlined the details it will be easier to determine how you will source the elements of the capability.

Each one-page capability description should include the following: Target use cases (optional): help you think of how and when processes, people, and technology play a role.

Process: describe the process of the capability. This could include inputs, key activities, and outputs for each capability.

People: includes the roles, responsibilities, and skills needed to support the process.

Technology: includes a description of applications, platforms, and other tools needed to support the process.

Example: Details of Lynchpin Capabilities of a Lemonade Stand CORE CAPABILITIES

COMPRISED OF

Procure Ingredients

Process: Checking ingredient inventory, purchasing ingredients People: Ingredient shopper Technology: Amazon Prime

Make Lemonade

Process: Following a recipe and adding ingredients, taste testing People: Lemonade maker, taste tester Technology: Measuring device, blender, refrigerator

Create Demand

Process: Determining the best way to share People: Market strategist, salesperson Technology: Signs, social media

ENABLING CAPABILITIES

COMPRISED OF..

Continually Improve

Process: New recipes People: Experimenter Technology: Test kitchen and gadgets

Gain Parent’s Permission

Process: Going to parents and making the case People: Kids, parents Technology: Testimonials from friends with supportive parents

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FILL OUT DETAILS OF PROCESS, PEOPLE, AND TECH

TOOL

CAPABILITY DETAILS WORKSHEET Identify the processes, people and technology needed for each Lynchpin Capability.

LYNCHPIN CAPABILITY

PEOPLE

PROCESSES

TECHNOLOGY

"We need the ability to..."

What roles do you need to create this capability?

What processes connect or enable the people and technologies?

What tools or resources do you need in order to achieve this capability?

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CONCEPTUAL DESIGN STEP 5 OF 7

DEPICT HOW THE CAPABILITIES WORK TOGETHER

An operating model is a visual depiction of how the core and enabling lynchpin capabilities relate and connect with each other in order to deliver value to the customer. This depiction can also help your organization understand how the new model relates to your current model. An operating model is a tool to help you share the story of the conceptual business model with others.

Operating models are not the same as organization charts, as they show how capabilities from internal and external collaborators can be sourced and recombined to support the new value delivery process. Depicting how the capabilities work together in an operating model helps to break down functional silos and organization chart boundaries. Operating models send a clear signal to the organization of how departments and individuals are expected to collaborate with a shared purpose for value delivery.

At a Glance • Determine the relationships you want to depict and the story you want to tell.

• Map the core and enabling lynchpin capabilities to test different relationships.

• Create a visual and written depiction of the operating model that tells the story of how the capabilities relate to each other.

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DEPICT HOW THE CAPABILITIES WORK TOGETHER

BIF Tips • Operating models are not traditional organization charts; they do not depict hierarchies and titles.

• Test different variations to ensure the operating model is depicting the story you want to tell.

• Consider how design elements might influence how the story is perceived (i.e. placement, colors, type of information).

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DEPICT HOW THE CAPABILITIES WORK TOGETHER

Creating an Operating Model An operating model highlights how lynchpin capabilities are deployed to deliver your value proposition to customers. An operating model is not an organization chart. Traditional organization charts do a great job of depicting relationships and functional hierarchies, but they do not provide a good sense of how work flows through a company across functions to deliver value. Operating models describe lynchpin capabilities and how they relate to each other—not only capabilities within the four walls of your organization but also capabilities from external organizations that contribute to how value is delivered to your customers. You are trying to answer the question, “How does your organization deliver value?”

Create Operating Models: Operating model visuals are highly organizationspecific; there is no single framework for creating an operating model because each model will be unique.

Focus on Relationships: Visualize the relationships between lynchpin capabilities to create your operating model.

Align Key Players: Do not underestimate the importance of creating a shared operating vision to align key stakeholders.

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FILL OUT DETAILS OF PROCESS, PEOPLE, AND TECH

GUIDE

CREATING AN OPERATING MODEL An operating model is a visual depiction that shows how lynchpin capabilities are networked and deployed to deliver your value proposition to customers.

An operating model can include—not only capabilities within the four walls of your organization but also capabilities from external organizations that contribute to how value is delivered to your customers.

Depicting How the Capabilities Work Together: 1. REVIEW THE CORE AND ENABLING LYNCHPIN CAPABILITIES. 2. DEPICT ALL OF THE LYNCHPIN CAPABILITIES.

Depict the core and enabling capabilities, and their corresponding details of process, people, and technology.

3. IDENTIFY AREAS OF OVERLAP BETWEEN THE CAPABILITIES AND THEIR DETAILS.

The following contextual information can help you consider the relationships of lynchpin capabilities for the operating model. Consider whether the entire capability or aspects of the capability currently exist in your organization. Examine the key linkages and interdependencies among the lynchpin capabilities.

4. DETERMINE THE STORY OF THE RELATIONSHIPS and value delivery you want to tell

through your operating model.

5. TEST SEVERAL VARIATIONS OF THE OPERATING MODEL to determine the best and

strongest option.

6. CREATE YOUR FINAL OPERATING MODEL in a shareable format.

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CONCEPTUAL DESIGN STEP 6 OF 7

IDENTIFY POTENTIAL REVENUE STREAMS

Most think a business model only showcases how an organization makes money. It isn’t.

A business model is a story that has three elements including how a company creates, delivers, and captures value. While it is not the only piece of a business model, a sustainable financial model that articulates how a business model is able to capture value is a key element.

Revenue streams showcase who pays in the model and what value they are paying for. The model may be financed through diverse funding streams; revenue does not always come directly from the customer. A new customer experience might include previously untapped revenue streams that can capture value for the business. The best revenue sources are those with the potential to sustain, scale, and improve the customer experience while also capturing new business value.

At a Glance • Brainstorm potential revenue and diverse funding streams.

• Identify which financial sources have the greatest potential for capturing value.

• Specify the implications and assumptions of these economic opportunities.

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IDENTIFY POTENTIAL REVENUE STREAM

BIF Tips • Do not get bogged down by trying to reach exact calculations on spreadsheets or thinking through all scaling considerations. Think in broad terms.

• Review analogous spaces to explore how transformative innovation activities produce revenue and tap into alternative sources of financial support.

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IDENTIFY POTENTIAL REVENUE STREAMS

Identifying Revenue Streams for a New Model Every business model clearly identifies how a business will capture financial value after creating and delivering value to the customer. A business model describes how revenue is generated, including who pays for delivered value and how they pay. It also describes the relationship between potential revenue sources and key cost drivers. At the conceptual design stage, you will not create a full profit and loss statement; the goal in this stage is to begin to understand the economic feasibility of your new model in the market at a small scale so you can test your assumptions in the Prototype & Test Phase.

Brainstorm Potential Revenue Streams: This step should only include documenting your initial assumptions and considerations for the potential revenue streams. It should not involve countless spreadsheets with projections based on what you think could happen.

Evaluate Revenue Streams: Determine a mix that can financially sustain the creation and delivery of value in the model.

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IDENTIFY POTENTIAL REVENUE STREAMS

GUIDE

IDENTIFYING REVENUE STREAMS Use the following steps to define how you will capture value to ensure the financial success and sustainability of the model.

1. BRAINSTORM POTENTIAL REVENUE STREAMS FOR CAPTURING VALUE FROM THE NEW CUSTOMER EXPERIENCE. Consider:

• Who pays and for what? Remember that often the person or intermediary is not the value recipient.

• For what value are customers willing to pay?

• For what do customers currently pay in the market?

• How will customers pay?

• How are customers currently paying in the market?

• How would customers prefer to pay?

• How much does each revenue stream contribute to overall revenue?

• Are there other financial resources that could be tapped? Identify where the potential financial resources might come from to sustain, scale, and improve your new model.

2. EVALUATE THE REVENUE STREAMS, determining a mix that is able to financially sustain the

creation and delivery of value in the model.

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IDENTIFY POTENTIAL REVENUE STREAMS

GUIDE

TYPES OF REVENUE Consider the following types of revenue streams: ASSET SALE

Selling ownership rights to a product. For example, Honda sells automobiles, motorcycles, scooters and other motor vehicles. Amazon sells books, music, consumer electronics, and more online.

USAGE FEE

The revenue stream is generated by the use of a particular service; the more a service is used the more the customer pays. For example, a telecom operator may charge customers for the number of minutes spent on the phone. A hotel charges customers for the number of nights the rooms are used.

SUBSCRIPTION FEE

Selling continuous access to a service. For example, a gym sells its memberships monthly or yearly in exchange for access to its exercise facilities. Spotify charges a monthly fee for access to an unlimited streaming music library.

LENDING, RENTING, AND LEASING

Temporarily granting someone the exclusive right to use a particular asset for a fixed period in return for a fee. For the lender, this provides the advantage of recurring revenues. Renter or lessees, on the other hand, enjoy the benefits of incurring expenses for only a limited time rather than bearing the full costs of ownership. For example, Zipcar.com allows customers to rent cars by the hour. This service has led many people to forgo purchasing an automobile in favor of renting, as needed.

ADVERTISING

This revenue stream results from fees for advertising a particular product, service, or brand. Historically, the media industry and event organizers were the main proponents of advertising for revenue. However, in recent years other sectors including software and services have also started relying on advertising revenue streams.

LICENSING

This revenue stream is generated by giving customers permission to use protected intellectual property in exchange for a fee. Licensing allows rights-holders to generate revenues from their property without having to manufacture a product or commercialize a service. Licensing is common in the media industry, where content copywriters retain ownership while selling usage licenses to third parties.

Similarly, technology patent holders grant other companies the right to use a patented technology in return for a fee.

BROKERAGE FEES

This revenue stream derives from intermediation services performed on behalf of two or more parties.

For example, credit card providers earn revenues by taking a percentage of the value of each sales transaction executed between credit card merchants and customers. Brokers and real estate agents earn a commission each time they successfully match a buyer and a seller.

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CONCEPTUAL DESIGN STEP 7 OF 7

IDENTIFY KEY COST DRIVERS

To complete the story of how a conceptual business model is able to capture value, you must identify the major cost drivers for delivering the experience. The new customer experience may have different cost drivers than your current model and even other models in the market. Some costs might be fixed, such as infrastructure or human capital, while others might be variable and directly tied to sales or revenue. Identify the costs that will have a significant financial impact on the new model and compare these with the potential revenue streams to help you determine the financial viability of the new model.

At a Glance • Brainstorm potential cost drivers. Use the lynchpin capabilities as a starting point for exploration.

• Identify cost drivers of the experience that will have the greatest impact on capturing value.

• Specify the implications and assumptions of all economic opportunities.

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IDENTIFY KEY COST DRIVERS

BIF Tips • Do not get bogged down by exact numbers on spreadsheets or implications of scaling the new customer experience.

• Review analogous spaces for the cost drivers of similar transformative innovation ideas.

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IDENTIFY KEY COST DRIVERS

Identifying Key Costs for a New Model Cost structure, infrastructure requirements, and financing models play an important role in any business model. They represent an architecture that financially fuels the model to enable ongoing value creation and delivery. They play an important role in business decision-making and can be the limiting factor to exciting new business model ideas.

Considering the economics of a model at a high level increases the chance of bringing insights about financial sustainability into the design process early. This helps you to avoid the trap of designing an elegant solution without considering if it can help you capture value. The time for doing unit cost projections and proforma profit and loss forecasts is in the Commercialize phase. In the Conceptual Design phase, you are describing cost drivers on a high level, not forecasting or predicting financials, as these will be based on make-believe numbers when you do not yet know what will work in the real world.

Brainstorm Cost Drivers: Consider the key costs for operating the new model; focus on the key operating and significant new capital costs.

Evaluate Cost Drivers: Determine which cost drivers are the most significant, describe the cost drivers on a high level.

Compare the Potential Revenue Streams with the Cost Drivers: You may need to reassess elements of your model based on this relationship.

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IDENTIFY KEY COST DRIVERS

GUIDE

IDENTIFYING COST DRIVERS Creating and delivering value, maintaining customer relationships, and generating revenue all incur costs. You must identify potential cost drivers, the most important costs incurred when operating a business model, and determine which cost drivers will be the most significant.

1. EXPLORE COST DRIVERS FOR THE NEW CUSTOMER EXPERIENCE.

Play with a number of different scenarios to help you understand potential cost drivers.

Consider: • What are the elements of the cost structure of the business model and how do they support value delivery?

• Which costs are variable and directly tied to unit sales?

• Which costs are fixed, representing required infrastructure and assets to support the business model?

• How heavily is your business model dependent on fixed costs? On variable costs? Can this change?

• How are financial resources allocated across your business model?

• Are you able to associate costs with those core capabilities you identified most critical to delivering customer value?

• Is there revenue left over after operating costs are covered to reinvest in the business model and to scale it to support growth?

2. IDENTIFY WHICH COST DRIVERS WILL BE MOST SIGNIFICANT.

• Which capabilities are going to be the most expensive?

• Of the people, process, and technology that comprise capabilities, which are going to be the most expensive?

• Are there costs to key partnerships that need to be maintained?

3. COMPARE THE POTENTIAL REVENUE STREAMS WITH THE COST DRIVERS.

• You may need to reassess elements of your model based on this relationship.

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IDENTIFY KEY COST DRIVERS

TOOL

CAPTURE VALUE WORKSHEET Consider what will cost money and how you could make money in the new experience to ensure financial sustainability of the new model.

Determine the revenue streams and major cost drivers that you could test in a prototype.

REVENUE STREAMS

COST DRIVERS

Who pays and for what?

What will cost money?

What will be your biggest expenses?

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P H AS E 3 O F 4 :

PROTOTYPE & TEST 118

PHASE 3:

PROTOTYPE & TEST PLAN PROTOTYPE

BUILD PROTOTYPE

RECRUIT PARTICIPANTS

RUN PROTOTYPE

ITERATE PROTOTYPE

INCORPORATE KEY LEARNINGS

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KEY TERMS Prototype: a small-scale, tangible representation of the entire conceptual business model that customers can directly engage with. A prototype is continually iterated based on customer interaction and feedback, resulting in a minimum viable business model.

Pilot: a full-fledged offering being tested in the market. Pilots are not iterated in real time based on customer feedback and the success of pilots are typically measured by traditional business metrics, such as customer acquisition, customer attrition, and potential for scale.

Minimum Viable Business Model: a conceptual business model that has been tested with customers in the market to determine the desirability, feasibility, and viability of the model, and has been proven to successfully create, deliver, and capture value at a small scale.

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PROTOTYPING THE WHOLE MODEL It is time to see if your new conceptual model will stand up to initial customer contact in the real world.

No analysis or traditional market research can determine if your new model will actually help customers solve for their job-to-be-done. You must test a low-fidelity prototype of the conceptual model at a small scale and improve it iteratively until the model is able to feasibly solve the customer’s job-to-be-done.

Once the model works at a small scale, you can then begin to plan for commercialization and scale.

A prototype is the fastest way to understand what works and what does not work in your conceptual model. A prototype is not the same as a pilot. Pilots are commercial-ready offerings rolled out in test markets to mitigate the risk and capital cost of scaling a new model too quickly. Low-fidelity prototypes are simulations of how all capabilities of a new model might work together in the market before investing in developing commercial-ready components. In a prototype, you do not wait for the long development cycles of solution components; you use temporary processes, tools, and roles created solely for testing the conceptual model to simulate the experience.

Prototyping helps you move quickly through transformational concepts while limiting the investment required to explore them. There are too many examples of organizations falling in love with new products and technologies and taking them through an extensive and expensive development process only to learn that there is no viable model to successfully commercialize them. Prototyping helps avoid this common problem.

Prototyping allows you to test all of the components of the conceptual model in the real world to understand the necessary elements, relationships, and impact of the model for both customers and the business. Prototyping the conceptual model decreases the risk of launching an offering that fails because all of the components of the model weren’t tested together.

A prototype of the conceptual business model helps you learn what works and what does not work in the model and provides evidence for the desirability, feasibility, and viability of the business model on a small scale. The learnings and iterations in the prototype result in a minimum viable business model that has the necessary capabilities to deliver on the value proposition in order to help the customer achieve their job-to-be-done. Evidence of a model’s success from prototyping is substantially more reliable than any other forecast or prediction.

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PILOTING TRADITIONAL APPROACH

DESIGN A Conceptual Model

ANALYZE How to Launch the New Model

LAUNCH The New Model to Market

PROTOTYPING & TESTING A NEW APPROACH

DESIGN A Conceptual model

TEST AND ITERATE Your Conceptual Model in a Prototype

QUICKLY DETERMINE How to Bring your Model to Market

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LAUNCH Your new Commercial Offering

PROTOTYPE & TEST CONTENT 1. PLAN PROTOTYPE Developing a Prototype Plan Establishing A Prototype Learning Guide Initial Prototype Plan Worksheet Capability Sourcing Chart 2. BUILD PROTOTYPE Building the Prototype Creating a Prototype Staff Manual Prototype Internal Team Task List 3. RECRUIT PARTICIPANTS Recruiting Prototype Participants Prototype Recruitment Criteria Participant Management Chart 4. RUN PROTOTYPE Observing the Prototype Prototype Notes & Observations Sheet 5. ITERATE PROTOTYPE Making Iterations to the Prototype Prototype Debrief Sheet Iteration Tracking Chart 6. INCORPORATE KEY LEARNINGS Getting to a Minimum Viable Model Prototype Debrief Questions

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PROTOTYPE & TEST STEP 1 OF 6

PLAN PROTOTYPE

Taking your conceptual design off the whiteboard and into the real world requires thorough planning to ensure that you can test all elements of the business model together. Try to maximize learnings about how the model creates, delivers, and captures value in a lowfidelity design. Determine the location, duration, participant information, and resources necessary to enable you to bring the prototype to life.

Experimenting is key, so you will need to obtain the necessary permissions to ensure that your prototype runs smoothly and is not constrained by your current business model.

Planning your prototype enables you to establish goals, objectives, and metrics for testing assumptions about how your prototype creates value for customers in the real world.

At a Glance • Determine where and when the prototype will occur.

• Decide how you will simulate and build elements of the customer experience, lynchpin capabilities, and financial assumptions of the conceptual model in a lowfidelity way.

• Determine how you will test and measure your assumptions around the customer experience, capabilities, and economic potential.

• Obtain the necessary permissions to build and run the prototype.

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PLAN PROTOTYPE

BIF Tips • Do not spend significant time planning your prototype; focus on the essential elements for it to function.

• Devise multiple ways to test your assumptions. You can test a component of the prototype over a few days, weeks, or months depending on what you are trying to learn.

• You will likely need to develop new measurement strategies because traditional growth metrics will not be applicable in a rapidly changing prototype.

• Don’t become too attached to anything in your plan.

If it does not work when you begin prototyping, try something else.

• Consider the scope and size of your prototype. If it’s too big it will take too long to launch.

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PLAN PROTOTYPE

Prototyping the Entire Conceptual Model Planning a prototype requires different processes and mindsets than planning a pilot. Planning a prototype does not entail creating overly detailed and complex plans that you cannot quickly execute. The goal is to build a lowfidelity prototype of your entire conceptual business model that you can quickly assemble in the market in order to learn from customer engagement and feedback. Through cycles of learning and iteration, the model will evolve to become a minimum-viable business model, ready for commercialization in the market. Your prototype plan is important for helping your team prepare for and align around launching the prototype with customers. The prototype plan will guide you towards the goal of creating an experience that is as seamless and authentic as possible, without spending years creating a perfect experience.

Obtain Support: Remember that prototypes require a different set of standards and conditions than your business may be typically used to.

Identify What You Want to Learn: You are trying to learn if your assumptions about the customer experience, capabilities, and potential financial impact are correct. You are not testing for the profitability in a specific timeframe.

Complete Prototype Plan: Determine how you will source the temporary components and conditions to simulate the conceptual model in the prototype.

Anticipate Making Changes: Your prototype plan sets you up to successfully build and run the prototype and helps you track your learnings but change your prototype plan if it’s not working once you begin to run it.

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PLAN PROTOTYPE

GUIDE

DEVELOPING A PROTOTYPE PLAN In your prototype plan, you should determine how you will source the temporary components to simulate the entire conceptual model in the real world.

Prototypes require a different set of standards and conditions than your business may be typically used to. You will need to determine the ideal conditions for your prototype and gain the appropriate permissions to build and run your prototype.

The beauty of prototyping before piloting an offering is that you are able to make changes during this testing period based on customer feedback and observation of the model. Your prototype plan sets you up to successfully build and run the prototype and helps you track your learnings throughout the entire process, without prescribing every detail of the prototype from beginning to end. Change your prototype plan if it’s not working once you begin to run the prototype.

Be sure to answer the following questions as you plan your prototype: WHERE?

What are the necessary conditions for prototyping? Is there an ideal location? How much physical space is needed? Are you building the prototype in a place associated with your organization or in a separate space, and how will this affect outcomes?

WHEN?

What is the timeframe for the prototype? 1 month? 3 months? 1 year? Are there specific cycles in your prototype? When do these begin and end?

HOW?

How are you going to simulate the entire conceptual business model in the prototype, including the customer experience, lynchpin capabilities, and economic potential? What resources and activities does this require? How will you source them?

WHO?

What is the recruitment criteria for participants? What roles are needed to staff the prototype and who will fulfill them? What roles are your team members playing? What are their responsibilities? Do you need any external partners?

WHAT?

What are you testing and measuring and how? How are you going to test for desirability, feasibility, and viability?

WHAT ARE YOUR KEY ASSUMPTIONS?

What are specific tests the concept must pass or strategic goals that must be accomplished?

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PLAN PROTOTYPE

GUIDE

ESTABLISHING A PROTOTYPE LEARNING GUIDE Putting together a learning guide will help maximize what you can learn about your model during the prototype.

Laying out your assumptions of the new model will help you determine what to pay attention to and measure throughout your prototype. Testing assumptions in a prototype will require different metrics than the traditional metrics your business likely uses today. Rather than focusing on the for profitability of the model you should focus on trying to learn if your assumptions about the customer experience, capabilities, and potential financial impact are correct. You will monitor how customers engage with the model to determine if the model is able solve their job-to-be-done, if they find the experience enjoyable and if you have the right set of capabilities to deliver the customer experience.

Be sure to answer the following questions as you plan your prototype: 01. RESTATE THE VALUE PROPOSITION

Define the strategic intent of the new customer experience being prototyped.

02. ARTICULATE NECESSARY FACILITATOR ROLES AND STAFF

Consider the roles that need to be performed within the prototype. Identify the individuals who will perform these roles.

03. DETERMINE FINANCIAL CAPITAL TO BE EXPENDED

Consider the resources required to run the prototype. The prototype will require human capital (i.e. paid employee time), physical capital (i.e. location rental), and all other running expenses.

04. LIST KEY ASSUMPTIONS TO BE TESTED

Consider and articulate assumptions made around the customer experience, capabilities, and revenue and cost drivers.

Example: Customer Experience Assumption: There is clear consumer value created through the model.

05. CREATE SUCCESS METRICS FOR LEARNING

Consider how you might test and measure findings around your untested assumptions during the prototype.

Example: Customer Experience Assumption: There is clear consumer value created through the model.

Success Metric: Consumers make at least six transactions during the 40-day prototype survey shows >50% likely to purchase.

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PLAN PROTOTYPE

TOOL

INITIAL PROTOTYPE PLAN WORKSHEET Identify the details of the initial prototyping plan.

How are you going to simulate the entire model (Create, Deliver & Capture Value) in a real world environment?

What do you want to learn about the customer experience, lynchpin capabilities, and economics?

Who will you engage in your prototype? What kind of behaviors or skills will those people need?

How will you know the impact of your prototype?

How are you going to know which components of the prototype work and which don’t?

How will you measure these elements?

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PLAN PROTOTYPE

TOOL

CAPABILITY SOURCING CHART The following chart can help teams break down the lynchpin capabilities and determine where to source them in the prototype.

CAPABILITY

PEOPLE/PROCESS/ TECH (TOOLS)

OUTCOME OR OUTPUT

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WHERE TO SOURCE CAPABILITY

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PROTOTYPE & TEST STEP 2 OF 6

BUILD PROTOTYPE

Following the prototyping plan helps you build a low-fidelity prototype that simulates the customer experience, lynchpin capabilities, and economics of your new business model. You will need to source capabilities that may be internal or external to your organization, recruit staff, and develop assets; this will take some time, but should not be prolonged. A prototype schedule provides a clear start and end point to your work and helps your team align around their roles, tasks, and responsibilities to build and run an effective prototype.

Building a prototype might feel scrappy as you piecemeal together aspects of the model, but remember that the goal is to quickly get to a low-fidelity prototype so you can test the basic assumptions of your business model. It is important to build a prototype that feels real enough to partners, the internal team, and most importantly, the customers in order to observe behavior that reflects how one would interact with a commercialized version of the offering in the market.

At a Glance • Develop and organize all necessary assets for building the prototype. This may include recruitment guides, staff manuals, and evaluation materials.

• Hire, assemble, and train a committed and adaptive team to run and manage the prototype for the duration of the prototype.

• Secure all logistics for launching and running the prototype.

• Combine all elements into an integrated prototype that effectively simulates the conceptual model and is ready to run with customers.

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BUILD PROTOTYPE

BIF Tips • Building the first version of the prototype might feel rushed and scrappy. Focus on creating an initial experience that will feel real enough for customers to interact with in order to gain their feedback. You can always iterate with higher fidelity or more time once you have gleaned initial learnings.

• Focus on building what you think is most important in the beginning, and anticipate building out secondary aspects that you had not considered as you learn what is important to customers.

• Source and combine existing resources and capabilities to accelerate building and running the prototype with customers.

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BUILD PROTOTYPE

Building a Prototype of the Entire Conceptual Model Your prototype plan will help you assemble the prototype and move from the whiteboard into the real world. As you move from planning to doing, the process will begin to feel real and, hopefully, exciting. You are about to learn more about your ideas and assumptions than you ever could through focus groups or financial projections. You will begin by assembling all of the pieces from your prototype plan. Your prototype does not have to be perfect in the beginning; that is why it is considered a low-fidelity prototype. There will be many moving parts occurring at the same time. Make sure your team is aligned and communicating often to help quickly troubleshoot issues that might arise.

Review Prototype Plan: Make you sure you have secured all of the logistics.

Assemble Prototype: Pull all of the pieces together in the real world to build your prototype.

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BUILD PROTOTYPE

GUIDE

BUILDING THE PROTOTYPE SOURCE CAPABILITIES

You will source capabilities from different parts of your existing organization or from external partners to build the lynchpin capabilities in your prototype. Once you have located the sourced capabilities, you can recombine whole capabilities or parts of those capabilities to work for your conceptual model. You will need to make sure the sourced capabilities work in the way that you imagined for the prototype and are not configured for how they are historically used in your organization.

HIRE AND TRAIN PROTOTYPE STAFF

You will likely need to hire people to run the prototype; these people could be from your organization or from external sources or networks. As you begin recruiting, search for people who are engaged in the process and are willing to work in a new way. It is critical that you clearly communicate the purpose of the conceptual model and prototype, and articulate that they will be expected to work in a different way than their current day-to-day jobs. The prototype staff will rely on existing skill sets but also will need to be trained to observe the behaviors of customers in addition to completing their assigned tasks. As the prototype evolves, the staff might have to adjust to new roles and assigned task. The staff will need to be flexible, and able to adjust to these changes. If your staff is close-minded and not flexible, you will encounter barriers once you begin iterating the prototype.

MAKE IT FEEL REAL

There are many logistics involved in building a prototype. Be thoughtful of both the holistic picture and the small details, but do not let perfectionism take over. As you begin to assemble the prototype, remember that it needs to feel real to the customers, not like a make-believe play set. Try to empathetically put yourself in the customer’s position as you build the prototype to ensure it reaches the right level of fidelity. Revisiting your insights from the Shift phase can help to determine if everything you built is in service of the value proposition.

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BUILD PROTOTYPE

GUIDE

CREATING A PROTOTYPE STAFF MANUAL As you begin hiring staff to run the prototype, you will need to arm them with pertinent information about the prototype. A staff manual will help prepare staff to properly execute their roles and explain their responsibilities within the prototype.

Make sure to include the following pieces of information in a prototype staff manual to help bring prototype staff onboard.

01. INTRODUCTION TO PROTOTYPE

Provides a brief overview of the prototype and explains the value proposition and the customer’s jobto-be-done that the model aims to solve.

02. LINKS TO MATERIALS

Links to any additional materials, guides, or resources that will help the prototype staff fulfill their roles in the new model.

03. PROTOCOLS

Describes the systems and processes in place for handling specific situations that might arise and how to perform their role in the prototype.

04. PROTOTYPE ACTIVITY BREAKDOWN

Guides and explanations of any specific activities that will occur in the prototype.

05. ROLES

Outlines the prototype roles and provides contact information for the team and staff involved in the prototype.

06. RESPONSIBILITIES

Expectations and requirements in the prototype. Outlines the behaviors that staff should exhibit during the process.

07. MASTER SCHEDULE

A master schedule to keep your prototype team organized. The master schedule should include a break down of the timeframe, roles, actions, and key events that will occur during the prototype.

A clear master schedule will help your team stay organized amongst the moving parts of the prototype. Each person will be able to see their roles and responsibilities as well as where they fit into the prototype.

08. INTERNAL TEAM TASK LIST

A tool to divide up responsibilities and deadlines in a way that is transparent to the whole team.

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BUILD PROTOTYPE

TOOL

PROTOTYPE INTERNAL TEAM TASK LIST A team task list will help an internal prototype team efficiently build the prototype by clearly stating deadlines and responsibilities.

Task

workflow

Deadline

Assigned Person

Ex: Secure a location

Call venues; secure commitment

10/20/2018

L.R.

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PROTOTYPE & TEST STEP 3 OF 6

RECRUIT PARTICIPANTS

Running a prototype requires great commitment from participants who are expected to both interact with the experience and provide feedback on the model’s ability to solve their job-to-be-done. These customers will be your key source of feedback regarding the prototype, and their participation is critical to understanding how value is created, delivered, and captured in the new model.

Rely on your prototype plan to recruit a representative sample of people that can provide multiple perspectives. Remember that you do not need a large number of participants to experience your prototype; instead find a small, engaged group that you can learn deeply from. Be transparent about the expectations and realities of prototyping, and that changes to the prototype are in service of bettering the experience for the customer. The feedback and insights you gain from the participants are invaluable, and critical to continually iterate, evolve, and improve the prototype.

At a Glance • Reach out to potential participants.

• Screen potential participants to ensure that they meet the criteria in your prototype plan and that they understand their unique, in-depth role in the prototype.

• Confirm the final participants and secure their commitment.

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RECRUIT PARTICIPANTS

BIF Tips • Rely on existing networks and relationships to help recruit trusting and willing participants. Consider using the participants recruited during the Shift phase.

• Communicate to participants the purpose of the prototype and the importance of their involvement.

You want participants to understand how critical they are.

• Focus on finding a small number of participants dedicated to the prototype process who can provide diverse perspectives and feedback.

• Consider the implications of how offering incentives may impact those willing to participate.

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RECRUIT PARTICIPANTS

Recruiting Participants for a Prototype Once you have determined the participant criteria and built a pool of potential participants for your prototype, you can begin the recruitment process.

Recruiting participants for a prototype is different than recruiting for a pilot. You will select and work with a smaller number of people who can provide a variety of in-depth perspectives regarding their interactions with the new customer experience and whether the model is fulfilling their job-to-be-done in a way that is better than current alternatives.

Reach Out to Potential Participants: Rely on existing networks and work from previous phases to reach out to interested participants.

Secure Commitment: Confirm that selected participants meet the recruitment criteria and that they will participate in the prototype.

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RECRUIT PARTICIPANTS

GUIDE

RECRUITING PROTOTYPE PARTICIPANTS Prototypes of an entire conceptual model are unique and require a sensitive approach to bringing people in to participate.

Consider the various factors of a conceptual model prototype before engaging with potential prototype participants and while communicating with participants: THE IMPLICATIONS OF PARTICIPATING:

The prototype will play an active role in the participants’ lives, and can positively or negatively impact them. Be aware of the impact your model could have on your participants before beginning the recruiting process.

BE UPFRONT WITH POTENTIAL PARTICIPANTS:

Ensure that you disclose all pertinent information to participants. Participants should understand that changes may be made to the prototype over the course of their interactions with it and that these changes are in service of creating a better experience.

BE CLEAR WITH THE TIMEFRAME:

The prototype may run for several months and you will need to recruit participants that are able to engage throughout the duration of the prototype, in addition to a sample of participants that are able to engage less frequently or for shorter durations.

BE TRANSPARENT ABOUT ENGAGEMENT EXPECTATIONS:

Consider the level of engagement that you are hoping participants will maintain with the prototype.

If you want to engage the same group of people over the course of several months, be sensitive to their lives and schedules, and make sure they can commit the time and level of response you are hoping for. Prototypes may require different levels of engagement and commitment to participate.

For example, some prototyping requires one-time encounters, while others require consecutive interactions.

CONSIDER YOUR SUPER USERS:

It can help to recruit participants that have already been involved in the Shift phase of the methodology. As in the Shift phase, you still work with a small number of participants to engage with your prototype; rather than observing them in their own lives and learning about their personal experiences, you will have them interact with a model and learn about these interactions.

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RECRUIT PARTICIPANTS

GUIDE

PROTOTYPE RECRUITMENT CRITERIA This process is similar to recruiting customers for the Shift phase but your recruitment needs may change due to the evolving nature of prototypes.

Consider these various factors when determining the recruitment criteria for the prototype: NUMBER OF PARTICIPANTS

Prototyping does not require large numbers of participants. You should focus on recruiting a small number of participants that will provide high-quality interactions.

DEMOGRAPHICS

Determine which demographics are important to your research (i.e. age, location, marital status, education, employment). These will vary depending on your prototyping conditions.

USER TYPES

Consider different types of users (i.e. core user, extreme user, experts, non-user), and be sure to include extreme and non-users since they can provide unconventional and non-obvious perspectives on your prototype.

DURATION OF PROTOTYPE

Prototypes may require different levels of engagement and commitment to participate. For example, some prototypes require one-time encounters, while others require consecutive interactions.

ADDITIONAL FACTORS

As you develop your recruitment criteria, it is important to consider multiple factors which will influence how you reach out to potential participants. Some of these factors include: •

Scope of the project: national vs. local participation

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Level of engagement: high-touch vs. low-touch

•

Type of research: digital vs. in-person

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Proximity to the research area

•

Age of participants

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Families vs. individuals

•

Number of participants

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Cultural context

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Technology usage

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Mobility

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Social structures

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Engagement norms

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RECRUIT PARTICIPANTS

TOOL

PARTICIPANT MANAGEMENT CHART Keep track of your prototype participants, their contact information and their type of engagement or research activity.

NAME FIRST, LAST

PREFERRED CONTACT METHOD

PHONE NUMBER

ADDRESS

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EMAIL

RESEARCH ACTIVITY

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PROTOTYPE & TEST STEP 4 OF 6

RUN PROTOTYPE

Once the conceptual model is fully represented in a prototype, it is time to begin engaging customers in the prototype. From the start, you will be testing the assumptions about the customer experience, capabilities, and economic elements of the model. The goal of running the prototype is to test assumptions about the experience and to learn as much as possible before commercializing it in the market.

During the prototype, it is critical to have team members dedicated to monitoring the overall logistics of the prototype, testing and measuring assumptions, and capturing learnings that can inform iterations.

At a Glance • Run the prototype. This is the fun part! You have prepared everything in the previous steps and are ready to see your conceptual model work in the real world. • Record learnings as they happen and document tested prototype measurements.

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RUN PROTOTYPE

BIF Tips • Expect the unexpected and be prepared to respond to necessary changes in your plan.

• Conduct checkpoint meetings with the prototype team to review feedback on what is working and not working. In-person meetings are often the most productive, but these meetings can be done virtually, if necessary.

• Team members should be able to adapt quickly and have a process for handling conflicts. This will be a huge asset to maximizing your learnings.

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RUN PROTOTYPE

Running the Prototype of the Conceptual Model Running the prototype is an exhilarating step. It relies on all of your preparation from the entire methodology. At this point in the Prototype & Test phase, you will have planned how you will test the conceptual business model, built the assets and hired the staff to support your prototype, and recruited participants to see if your proposed solution will help them solve their job-to-be-done.

Relax: Take a moment to breathe before you run the prototype. You will likely feel rushed and under-prepared and wish you had more time, money, and capacity to continue building and designing pieces of the prototype.

Observe: When running the prototype, ensure that you have dedicated time to observe the prototype to determine how all of the pieces of the business model are working together.

Learn and Measure: Learning about the model on a holistic level requires a dedicated eye to measure the pieces of the prototype and how they relate to one another.

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GUIDE

OBSERVING THE PROTOTYPE Observing the prototype helps you to understand the holistic picture of what is working and not working in the model without disturbing the experience for the customers.

Observing how people interact with the environment, products, other customers, and staff helps you understand how customers perceive the new customer experience. Observations should be conducted throughout the prototype; however, the exact observational practices should be determined based on the nature of your specific prototype. Tracking your observations will help your team manage learnings and changes made to the prototype.

01. PREPARE TO OBSERVE •

Understand what you plan to observe in the prototype.

•

Create a list of things to focus on, but remain flexible to the unexpected.

•

Dress in a way that fits the customer experience so you make customers comfortable (i.e. formal business attire may be intimidating to someone picking up a prescription after the gym).

•

Bring a notebook and pens for taking notes, even when using a digital recorder.

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Refer to your learning guide to know what you want to learn more about.

02. TAKE RECORDED NOTES •

Record the date, location, and time of the prototype.

•

Record descriptions of participants (i.e. name, demographics, relationships, etc).

•

Sketch the layout of the space, including key features and flow.

•

Use shorthand or codes to write quickly.

SUGGESTED OBSERVATIONS: •

Setting and senses (i.e. furniture arrangements, temperature, colors, lighting, smells, noise, etc.)

•

Demographics (i.e. number of participants, approximate age, apparent gender, etc.)

•

Communication (i.e. statements, questions, responses, key vocabulary, body language, unconscious gestures, conscious gestures, verbal pitch, tone, and volume, etc.)

•

Behaviors (i.e. actions, participants, objects, etc.)

•

Movement (i.e. interactions, entrances, exits, duration of exchanges, etc.)

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RUN PROTOTYPE

TOOL

PROTOTYPE NOTES & OBSERVATION SHEET Record any notes and observations from your prototype DATE: MEETING & PARTICIPANTS: RESEARCHER(S): GENERAL NOTES:

PROTOTYPE Observations:

What is standing out to you?

What needs to be changed?

What is working well?

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PROTOTYPE & TEST STEP 5 OF 6

ITERATE PROTOTYPE

During a prototype, the goal is to learn, adapt, change, and pivot, if necessary. Inevitably, some of your assumptions will fail and you will have to make the appropriate changes.

Every iteration will bring you closer to a model that is successfully able to create, deliver, and capture value; iterating elements of the prototype as it runs will maximize your learnings and increase value at a low risk.

Prototypes are adaptable to the needs of customers by modifying, adding, or eliminating capabilities to support a desirable experience. Over the duration of the prototype, there will be iterations that can be made quickly, while others will need to be captured and considered for additional rounds of prototyping, or for when the business model is scaled. It is important to document both types of iterations as key learnings from your prototype.

At a Glance • Measure your assumptions by capturing data during the prototype.

• Brainstorm ways to adapt the prototype based on findings and consider what you might need in order to implement those changes.

• Make feasible iterations to the prototype in real-time and track these changes to understand their impact on the prototype.

• Continue to run and iterate the prototype throughout its predetermined length.

• Document potential long-term iterations that could take place in a future prototyping phase.

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ITERATE PROTOTYPE

BIF Tips • Do not become too attached to the prototype. If something is not working, change it.

• Remember that prototyping is a learning process; the more you iterate, the more you will learn.

• Think of learning as a measure of success when something does not go as planned or when something is deemed a failure. There will be learnings from those experiences that will inform future decision and actions, which makes the experiences extremely valuable.

• Tracking when and why iterations were made to the prototype helps you tell the full story of how the conceptual model evolved into a minimum viable model.

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ITERATE PROTOTYPE

Iterating the Prototype Iterating is a key distinction between a prototype and a more traditional pilot, as prototypes are flexible to feedback and change. A low-fidelity prototype gives you the space to explore and make changes to the model to make it better in real time. Prototyping is the time to fail fast and learn. Do not think of failure as the endpoint; instead, think of it as an opportunity to learn how you can improve the model and to pivot.

Reflect and Debrief: Take time as a team to reflect and debrief in order to determine how to best capture learnings and iterate the prototype.

Iterate Along the Way: Some simple iterations can happen immediately during the predetermined duration of the prototype, while some might be more robust and require more time to plan.

Track Iterations: It will be beneficial to track the iterations that you make to the prototype, including the elements you changed, when they were implemented, how they were implemented, and the impact that they had on the model.

Refocus on Your Overall Model: Iterating an aspect of the customer experience may influence the capabilities required to deliver the experience, so remember that your iterations need to be considered in service of the entire model.

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ITERATE PROTOTYPE

GUIDE

MAKING ITERATIONS TO THE PROTOTYPE Make changes to the prototype when you see something that isn’t working; it will help you maximize your learnings.

CONTINUALLY DEBRIEF WITH YOUR TEAM In order to make iterations to the prototype, you need to debrief with your team to determine what has been working and not working, and to develop new questions or topics to explore.

Debriefing is a critical part of iterating and should occur on a regular basis. In-person debriefs are most effective, but they can be held virtually, if necessary. Discussions should be open and honest to allow all stakeholders involved in the prototype to share their opinions and perspectives. This will ultimately lead to a stronger minimum viable business model.

DETERMINE THE ITERATIONS TO BE MADE Iterations may be short-term or long-term depending on your learning objectives and the feasibility of incorporating the iterations into the prototype. Short-term changes can be quickly implemented, while long-term iterations should be documented for future versions of the prototype or as learnings for how the model is commercialized. Some iterations, such as needing to add or remove capabilities or to build additional elements into the experience, will take time to plan for and can be documented to be tested in a later prototype.

TRACK THE PROTOTYPE ITERATIONS When iterating, be sure to keep track of these different types of iterations. An iteration tracking chart can help your team track learnings, understand how the prototype has shifted from its original form, and justify why and when the changes were made. This chart will help inform your key learnings at the end of the prototype when you compare your conceptual business model to what occurred in the prototype to arrive at your minimum viable business model.

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ITERATE PROTOTYPE

TOOL

PROTOTYPE DEBRIEF SHEET After testing your prototype, record what you have learned.

DATE: NAME OF PARTICIPANT(S):

What is working?

What is not working?

New questions or topics to explore:

New ideas:

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ITERATE PROTOTYPE

TOOL

ITERATION TRACKING CHART Track the changes made to the prototype to help see how the prototype evolves overtime.

CONCEPTUAL DESIGN ASSUMPTION

COMPONENT OF PROTOTYPE

WHAT DID THE PROTOTYPE SHOW?

ITERATION TO MAKE

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DATE ITERATION IMPLEMENTED

IMPACT OF THE ITERATION

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PROTOTYPE & TEST STEP 6 OF 6

INCORPORATE KEY LEARNINGS

At the conclusion of the prototype, you have tested your assumptions regarding your conceptual business model and have validated how value is created, delivered, and captured in your model. Iterating the prototype has maximized your learnings and determined what stood the test of customer interaction. You have an idea of what the desired customer experience is, the necessary capabilities to deliver the experience, and an understanding of how the model can capture value for the business.

The prototype learnings need to be analyzed, documented, and integrated into the conceptual business model in order to tell the story of how the conceptual design resonated in the real world. Incorporating key learnings together helps determine the essential elements of your final output: the minimum viable business model.

At a Glance • Compare the conceptual design assumptions with prototype learnings to determine what stood the test of customer interaction.

• Organize your learnings to isolate the essential elements of the model.

• Incorporate the key learnings into a revised business model, creating your minimum viable business model.

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INCORPORATE KEY LEARNINGS

BIF Tips • Review the prototype learnings holistically to understand how the different elements worked together in the model. • Dismiss personal assumptions, preferences, or opinions and rely on what the prototype learnings tell you about the model.

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INCORPORATE KEY LEARNINGS

Incorporating the Key Learnings While running and iterating the prototype, you uncovered many key learnings.

Some of these learnings led to quick adaptations in the prototype, and other critical learnings were documented to be revisited at the close of the prototype.

Once the prototype is completed and you have reached a point where you feel it is repeatable and scalable, incorporate your learnings into a final conceptual design of the minimum viable business model.

Reflect and Debrief: Take time as a team to reflect and debrief in order to determine how to best capture learnings and iterate the prototype.

Reference the Learning Guide: Refer back to the learning guide and any other tools used to determine which assumptions stood the test of the real-world prototype.

Analyze Metrics: Use the metrics against which you tested your assumptions and the data to prove whether your assumptions were correct. Visualize metrics, portraying the results in a way that is easy to understand and interpret.

Interpret Additional Insights: In addition to the metrics you tested, document additional general insights about how the model creates, delivers, and captures value that you learned from prototyping the experience.

Synthesize Learnings: Combine the metrics and insights to establish your key learnings from the prototype.

Develop Minimum Viable Business Model: Use the key learnings to develop the minimum viable business model to be explored for commercialization.

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INCORPORATE KEY LEARNINGS

GUIDE

GETTING TO A MINIMUM VIABLE MODEL At the beginning of the Prototype and Test phase you will have assumptions around how your model will create, deliver, and capture value. During your prototype you will learn whether these assumptions were correct or incorrect. You will incorporate these learnings in addition to the other knowledge you gained from prototyping into the minimum viable business model.

PROTOTYPING YOUR CONCEPTUAL BUSINESS MODEL CONCEPTUAL DESIGN

ASSUMPTIONS around how you will:

PROTOTYPE

MINIMUM VIABLE MODEL

ITERATE

EVIDENCE from the real-world about how to: • Create Value

• Create Value • Deliver Value • Capture Value

• Deliver Value LEARN

BUILD

TEST & PROTOTYPE EVALUATE MEASURE

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• Capture Value

INCORPORATE KEY LEARNINGS

TOOL

PROTOTYPE DEBRIEF QUESTIONS Answer the following questions to help align your team around your confidence, excitement and readiness to move your conceptual model to the market.

WHAT DID YOU LEARN? 1. Were you able to prototype the entire model (create, deliver, capture) or did you prototype a component part of the model?

2. Do you consider what you prototyped to be incremental or transformational to your current business model and why?

3. What were the key takeaways about your model?

Customer Experience (create value): Capabilities (deliver value): Revenue Streams & Cost Drivers (capture value):

WHAT IS YOUR CONFIDENCE IN THE MODEL? 1. How confident are you in what you’ve prototyped?

2. Are you excited to move the model forward?

3. How ready is your team to move forward?

4. Is your team aligned around the same objective?

5. What is your organizations readiness to transform?

WILL YOU REQUIRE ADDITIONAL PROTOTYPING? 1. What would you want to continue prototyping? Is there something you are still unsure about?

2. What will this additional prototyping or learning require?

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P H AS E 4 O F 4 :

COMMERCIALIZE

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PHASE 4:

COMMERCIALIZE EVALUATE ALTERNATIVES AND SELECT STRATEGIC OPTION

IDENTIFY COMMERCIALIZATION REQUIREMENTS FOR SELECTED STRATEGY

DEVELOP IMPLEMENTATION ROADMAP

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KEY TERMS Scale (n): the number of customers and markets served by a business model.

Scale (v): to bring an offering to market, with an increasing number of customers and markets served.

Commercialize: to bring a tested offering to market.

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BRINGING YOUR MODEL TO MARKET Once you have a minimum viable business model that has successfully survived initial customer contact through the Prototype and Test phase, you are in a good position to evaluate strategies to commercialize the model. This is the time to consider questions of scalability and change management. Should the tested model become the organization’s new core business model?

Should it be integrated into your current business model? Should it be taken to market as a separate business model? Should it be shelved and the learnings harvested to develop other concepts? You are now in the position to evaluate and select a strategic option, to identify commercialization requirements, and to develop an implementation roadmap to execute the selected strategy.

The prototype has provided evidence around whether the new business model can help solve the customer’s job-to-be-done, and has showcased how all the model’s elements work together at a small scale, which will minimize the risk of commercializing a solution in the market.

The Commercialize phase of the Design Methodology will likely be the most familiar to your organization as you consider what it will take to scale the minimum viable business model to a wider market. During the transition from design to commercialization, it is important to ensure transformational new models do not become incremental point solutions once your organization comprehends the scope of change required to successfully scale a transformational model.

Remember, the goal is transformation, not tweaks.

The Commercialize phase results in a commercialization plan to bring the new model to market.

This plan includes the selected strategic option, the commercialization requirements, and an implementation roadmap. The commercialization plan will help you strategically implement the model to maximize value for customers and the business. If done correctly, the plan will help ensure that transformational new models don’t become tweaks in translation.

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Evaluating multiple strategic options to commercialize a next practice or new business model will inform a decision on whether and how best to go-to-market.

Identifying key operating and change management implications will inform the development of an implementation roadmap for commercialization.

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COMMERCIALIZE CONTENT 1. EVALUATE ALTERNATIVES AND SELECT STRATEGIC OPTION Exploring Strategic Options Defining a Commercialization Vision 2. IDENTIFY COMMERCIALIZATION REQUIREMENTS FOR SELECTED STRATEGY Commercialization Requirements 3. DEVELOP IMPLEMENTATION ROADMAP Implementation Considerations Implementation Roadmap Worksheet

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COMMERCIALIZE STEP 1 OF 3

EVALUATE ALTERNATIVES AND SELECT STRATEGIC OPTION

The minimum viable business model could take different forms moving forward and various options must be strategically evaluated before any major decisions can be made.

Potential commercialization options range from harvesting prototype learnings in order to incrementally improve the current business model to moving to an entirely new model.

Depending on the urgency and risk to commercialize a new model, it may be prudent to take the prototype into a pilot phase before going to full scale. Another answer may be to establish or spin off the new business model as a separate business. In order to make a decision, you must evaluate the pros and cons of each option and consider the strategic direction that your organization wants to take moving forward.

At a Glance • Evaluate possible strategic options by comparing the dimensions of customer experience, capabilities, and economic potential for each of the strategic options. • Select the most promising strategic option based on the minimum viable business model, strategic direction of the company, financial requirements, and risk.

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EVALUATE ALTERNATIVES AND SELECT STRATEGIC OPTION

BIF Tips • The best option to move forward will not be the same for each organization, project, or model. It is dependent upon many factors that need to be considered together in order to determine the most beneficial way to incorporate prototype findings into the organization, if at all.

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EVALUATE ALTERNATIVES AND SELECT STRATEGIC OPTION

Taking Your Model to Market With a minimum viable business model in hand, it’s time to look at next steps.

There are many potential avenues that you can pursue, and you should take time to evaluate your options before you make a major decision.

At this point in the methodology, you should start to think about your current business model and how the new model could be incorporated into it. This may require a drastic transformational step such as changing your entire business model or creating a separate entity in which the new model can live. These potential options need to be evaluated against the strategic direction that your company wants to take, while also maintaining the integrity and essence of the minimum viable business model. Choose an option that makes strategic and financial sense for your enterprise.

Reflect and Debrief: Take time as a team to reflect and debrief in order to determine how to best capture learnings and iterate the prototype.

Evaluate the Potential Strategic options based on the desired customer experience, necessary capabilities, model economics, and organizational needs.

Harvest Key Learnings: Take what you have learned and incorporate it into the current business model.

Pilot at a Larger Scale: Run a pilot of the new model for a certain amount of time to provide additional evidence of value at a larger scale.

Integrate Directly into the Core Model: Use learnings to integrate the new model with your current business model.

Change the Core Business Model: Transform your current business model to the new model.

Spin Off into a Separate Entity: Develop the model as its own entity as a spin-off to the current model.

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EVALUATE ALTERNATIVES AND SELECT STRATEGIC OPTION

GUIDE

EXPLORING STRATEGIC OPTIONS Explore each of the strategic options and consider how it might affect your organization and your model. Be open here - capture the pros and cons for each option.

HARVEST KEY LEARNINGS Don’t move your model forward. Use what you learned to make small improvements to the way your business operates today.

• Put your idea on the shelf and come back to it later • You learned your model didn’t work and is not worth taking further • You just are ready to move forward at this time, the conditions aren’t right

CONTINUE PROTOTYPING Keep prototyping and learning to build your confidence in your decision to move your model to the market.

• You only tested elements of the model and you want to test the entire model • You need to learn more to build confidence in the model • You’re not ready to make a decision to go to market • Conditions aren’t there (leadership isn’t ready to go market, only prototype)

INTEGRATE INTO THE CURRENT MODEL Integrate what you’ve learned into the current business, changing how you operate today to accommodate the new model.

• You have a strong understanding of your model and what you’re bringing to the market • You have the support to enter the market • You have confidence that your model will survive in the market • You are willing and able to change your current model

STAND-ALONE INDEPENDENT VENTURE The new model lives alone and does not impact or change the current business model. This could include selling the model or operating the new model outside of the current business.

• You do not want to impact your current model but know that your model can flourish in the

market • The model serves a new market that you don’t have access to • You don’t have the capabilities for the new model but another entity does

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EVALUATE ALTERNATIVES AND SELECT STRATEGIC OPTION

GUIDE

DEFINING A COMMERCIALIZATION VISION Discuss the scale and timing of your commercialization vision. Try to find a balance between being bold and being realistic.

HOW BIG, HOW FAST How big is your vision?

What is your vision of scale?

How many users do you want to reach?

How large is your intended market?

How fast do you want to achieve your vision?

How much time do you plan to take to achieve your vision of scale?

Is there a minimum or maximum amount of time?

How long do you think it will realistically take to reach a steady state?

DEGREE OF CHANGE How much change is required to achieve your commercialization vision?

How different is the new customer experience from the current experience?

How big of a change is this going to be for you organization?

How different are the new capabilities from your existing capabilities?

How ready is your organization for the required change?

Is your organization ready for and receptive to this change?

Have you communicated your transformation story to your organization?

Do stakeholders understand the need for change?

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COMMERCIALIZE STEP 2 OF 3

IDENTIFY COMMERCIALIZATION REQUIREMENTS FOR SELECTED STRATEGY

Once you have determined a strategic option to move forward with, you must identify the high-level requirements for taking the model to market. You will need to engage key stakeholders and strategizers to work with you to identify the resources necessary to commercialize the model and establish measurements of implementation success. During this step, you will begin to articulate how the model will come to life within your organization.

At a Glance • Identify and invite key stakeholders and staff to strategize around the high-level commercialization requirements. • Identify high-level commercialization requirements of your selected strategy. These may include operating requirements, change management strategies, success metrics, and resource needs.

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IDENTIFY COMMERCIALIZATION REQUIREMENTS FOR SELECTED STRATEGY

BIF Tips • Understand that this is a critical planning phase—be sure to include all necessary staff and stakeholders in strategy-setting or the work could be stalled or stopped altogether.

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IDENTIFY COMMERCIALIZATION REQUIREMENTS FOR SELECTED STRATEGY

Identifying Your Commercialization Requirements In the first three phases of the methodology, we advised against considering scale and change management efforts because we did not want you to hold back from thinking transformationally. In the Commercialize phase, however, you must now focus on what is required to implement and scale a model.

The imperative during this phase is to stay true to the transformational new model that you have designed and not to fall into the trap of maintaining the organization’s status quo or watering down powerful concepts because of logistic or resource concerns. Transformational customer and business value is worth the work.

Once you have chosen a strategy for bringing the new minimum viable business model to market, you must begin considering, at a high-level, how to actualize the selected strategy within your organization. Invite key stakeholders and strategizers to work with you to identify the resources necessary to commercialize the model and establish measurements of implementation success. It may take months or years to commercialize the model within your organization, depending on the scale of implementation—it is imperative to ensure your model design and learnings from prototyping do not get lost in implementation planning.

Identify and Invite Key Stakeholders and Staff to Strategize: Assemble key stakeholders and decision-makers within the organization. Draw on their expertise to identify implementation needs.

Identify Commercialization Needs: Consider the key operating requirements, change management strategies, success metrics, and resource needs for your selected strategy.

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IDENTIFY COMMERCIALIZATION REQUIREMENTS FOR SELECTED STRATEGY

GUIDE

COMMERCIALIZATION REQUIREMENTS Determine what will be required to execute your commercialization vision.

GOVERNANCE: What leadership is required to make key decisions?

Does this person or multiple persons exist internally?

Who else do you need for decision making?

IMPLEMENTATION TEAM FORMATION: Who is going to be part of the commercialization team?

Will they have responsibilities in addition to commercializing the new model?

Who are the necessary core team members?

Who are the extended core team members?

KEY RESOURCES: What are the required physical, intellectual, and financial resources for your model?

Which do you already have, and which will you need to acquire?

How will you acquire them?

EXTERNAL PARTNERSHIPS: Who are the partners that you need to engage with to make your vision successful?

What do you need them for?

How will you reach out to partners?

CHANGE MANAGEMENT: Change management can be scary, but is a necessary part of any transformation.

Consider what it will take to create a successful transition at your organization.

Who are the groups and people who will need to change their core functions?

In what ways will they need to change?

How will people become aware of the change required and how will this be communicated?

What type of training and coaching will people undergo?

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COMMERCIALIZE STEP 3 OF 3

DEVELOP IMPLEMENTATION ROADMAP

An implementation roadmap outlines organizational next steps for enacting your selected strategy. The roadmap includes roll-out plan, roles, tim-frame, milestones and key activities to bring the model to the market. An implementation roadmap should clarify attainable goals within a specified timeframe, identify hurdles that may be encountered along the way, and highlight the organization’s strengths. Once the roadmap is complete, you will have a clear path for commercializing an offering that creates new value for customers and has been tested in the market.

At a Glance • Develop an implementation roadmap that outlines the plan for taking your new model to market.

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DEVELOP IMPLEMENTATION ROADMAP

BIF Tips • This step may be the most familiar and comfortable for your organization, as it requires the use of traditional business metrics. It is important to illustrate your roadmap and plan in a way that leadership and management can understand and engage with.

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DEVELOP IMPLEMENTATION ROADMAP

Developing your Implementation Roadmap The final step in the Design Methodology sets you on a path to successfully commercialize your new business model. Creating an implementation roadmap allows you to articulate your vision for success, identify potential challenges or roadblocks, and create an actionable plan with time frames, key activities, roles, and milestones.

Managing the transition from designing and testing a new business model to bringing the model to market is a critical step in preparing your organization for transformational change. If there is no action plan, the organization may revert back to easy tweaks and remain ripe for future disruption. The implementation roadmap creates an actionable plan for bringing the model into being and offers a collective vision for staff to follow throughout the model’s implementation. It is important to remember that throughout planning and implementation, you must ensure the design and learnings from prototyping remain intact.

Define Success: The world is rapidly changing, and you want to make sure that your solutions are evolving with it. Defining success will help you stay relevant and continue working towards your goals. Success will look different depending on your implementation timeframe; you may have multiples visions of success at different periods.

Create Roadmap: Lay out all of the elements of bringing your model to market along a timeline so you are able to visualize the process.

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DEVELOP IMPLEMENTATION ROADMAP

GUIDE

IMPLEMENTATION CONSIDERATIONS Make sure your team is aligned on the necessary activities and resources for implementing your commercialization plan.

MILESTONES AND DATES:

Identify critical milestones and dates that are relevant to your vision(s) of success and strategic vision.

POTENTIAL CHALLENGES:

Consider some of the challenges you might encounter when moving forward with bringing your model to market. Don’t let the challenges paralyze you into inaction; instead, consider how they might be mitigated.

POTENTIAL OPPORTUNITIES:

Identify potential opportunities that could help bring the model to the market such as external partnerships, funding resources, etc.

KEY ACTIVITIES

Identify any key activities that will occur at the various milestones while bringing the model to market.

PERFORMANCE METRICS:

Create a set of metrics that will enable you to track whether the model is performing or scaling as predicted. These will likely be traditional business evaluation metrics.

PEOPLE:

Determine the roles and responsibilities that people will have. Identify the support you will need from leadership, staff, and external partners, and decide how you will engage them.

TECHNOLOGY:

Identify tools and technology that you may need moving forward.

FINANCIAL COSTS:

Provide estimates of the financial requirements for successfully commercializing the model.

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DEVELOP IMPLEMENTATION ROADMAP

TOOL

IMPLEMENTATION ROADMAP WORKSHEET Block and tackle your team’s next steps. Determine your timeframe, milestones, measures of success, and key activities. Also consider any barriers you might face and how to overcome those barriers.

ESTIMATED TIMEFRAME MILESTONES What’s going to happen?

What are some key things that must happen to bring your model to market?

MEASURES OF SUCCESS How will you know you have reached a milestone?

KEY ACTIVITIES What is necessary to achieve your milestones?

ANTICIPATED BARRIERS OR OBSTACLES

What might prevent you from reaching your milestones or key activities?

HOW TO OVERCOME BARRIERS

What will help you easily overcome your barriers to achieve your milestones and key activities?

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