We are in a new age of innovation and entrepreneurship. The recession of 2008 has created a start-up bubble across sectors; the Kauffman Index of entrepreneurial activity reached its highest ever level in 09-10, higher than the dotcom bubble of 97-2000.[i] Nowadays we think of start-ups being Silicon Valley based and technology focused but this is an outdated mindset; start-ups are everywhere and are customer focused – more specifically the problem of the customer. The fact of the matter is technology will play a major part in solving that problem… whatever that problem is.
Technological advances, open source cloud software, real time customer feedback and a better understanding of start-up management are just some of the reasons why small companies are making big waves in a market that evolves at an ever increasing rate. As consumers, we hear about new innovative companies that will change the way we live on a daily basis – of course most of them don’t but that shouldn’t and can’t stop them from trying. When one innovation is successful in the market there are only three options available to major companies in the same field:
- Pay over the odds to buy the start-up (Think Facebook’s purchase of WhatsApp for $19 billion, not for their product but for their near 500 million active users).[ii]
- Quickly try to play catch-up
So what should we do if we are not a start-up? What if we are part of a medium to large enterprise with a large customer base, a proud history and a headline grabbing brand name? None of these options are good enough, we must innovate first!
Businesses have long understood the benefit of aligning ‘Operational Excellence’ directly to the value derived for its customers. Today in our start-up world this has never been more important. It is not just technology that is evolving rapidly; customers and markets are as well. Organisations can find that they have ‘excellent’ operations which are no longer aligned to customer need; we must bridge the gap between innovations to solve the customer’s problems and consistently being ‘Operationally Excellent.’
To do this, organisations must empower and support their teams to become intrapreneurs. Through the formation of innovation bubbles containing the full end-to-end skill set of the organisation, new products and services can be developed with a start-up culture. These teams, utilising the power of the organisation’s resources and knowledge base, can actively engage customers to identify problems and rapidly build experiments to test their assumptions. Learning by doing and failing quickly means they can understand the customer’s true problem and progress towards a better solution design.
Once the problem and an initial solution have been identified the product or service must be developed with the customer. Businesses that respond to change can out-perform competition by deploying Agile expertise to develop new or enhanced products and services at an accelerated rate with reduced risk. The market-facing innovation bubble and back office operational teams must come together to form a cross-functional solution team with the user at its heart. The innovation bubble expands to an Agile team which is aligned with business operations through a standard way of working across the organisation such as an approach like the Capgemini Lean Foundations-Digital Distributed Delivery© (CLF-3D). The CLFs are Capgemini’s distilled learning from five years of implementing Lean in its own operations and is a powerful approach for operational excellence across the end-to-end value chain. CLF enable the teams who are closest to the client, to respond quickly, flexibly and reliably to client needs following 10 clear and pragmatic foundations. To find out more about the CLFs watch the video here.[iii] To support the CLFs, the 3D digital tools are deployed; these enable operational excellence across distributed teams using collaboration software.
Once the product or service is reaches a saleable state, the connection between those in the solution team and business operations should be sustained which enables continued innovation. This is again underpinned with proven Lean management best practices, the CLF Voice of the Customer is embedded into the management of products and services which helps them to adapt and evolve with the customer’s needs. At this stage the priority for everyone involved is to identify the customer’s next problem and provide the truest form of ‘Operational Excellence’ – continued innovation.