The world changes every day. Exploring how change might affect your organization is an exciting learning experience—one that may even surprise you!
Many executives spend most of their time dealing with internal issues, never looking beyond what's happening within the organization. Don't be one of them!
The biggest threats and opportunities for your organization can be found in the emergence of new technologies and business models, as well as in changes to the environment beyond your industry as it stands today. All of these elements represent external disruption that may be relevant for the future of your organization over both the short- and long-term. So, let's find them!
This week's assignment sets the foundation for the Core Stream. It will help you gain a strategic overview of the most important technologies that may disrupt your industry either now or in the future. How is your industry already being reshaped? By looking “outside the building” you will gain an understanding of how your organization needs to be reshaped, not only to survive but to leverage existing opportunities.
Exponential Technology | Risks | Opportunities | Timing |
Name and/or description here… | How it can disrupt your industry… | How it can bring new business opportunities… | When this exponential technology might impact the industry… |
Disruptive Business Model | Risks | Opportunities | Timing |
Company name and/or description here… | How it can disrupt your industry… | How it can bring new business opportunities… | When this new business model might disrupt your industry… |
Context changes | Risks | Opportunities |
Description here… | How it would impact the industry… | How industry can benefit… |
Exponential Technology | Risks | Opportunities | Timing |
Name and/or description here… | How it can disrupt your industry… | How it can bring new business opportunities… | When this exponential technology might impact the industry… |
Internet | Enables sharing economy and P2P business models. | Enables hotels to better reach clients and develop new business models. | Now |
Artificial Intelligence & Robotics | Automate majority of hotel's operations and increase competition. | Help hotels better understand clients. | Within the next 2 years |
Drones | Provide new ways of traveling. | Provide new ways of traveling. | Within the next 5 years |
Virtual Reality | New technology could reduce desire to travel. | Leverage technology for hotels. | Within the next 2 years |
Disruptive Business Model | Risks | Opportunities | Timing |
Company name and/or description here… | How it can disrupt your industry… | How it can bring new business opportunities… | When this new business model might disrupt your industry… |
Airbnb (sharing economy leverages assets) | Offers customers eco accommodations. | Launch a P2P sharing economy platform. | Now |
Uber (on demand staff) | Allows competitors to be more responsive to market needs. | Implement the Community attribute. | Now |
Cratejoy (subscription business model) | Lose market share as consumers gravitate to hotels participating in subscription services. | Launch a subscription business model. | Now |
Context changes | Risks | Opportunities |
Description here… | How it would impact the industry… | How industry can benefit… |
New players based on sharing economy. | Sharing economy platforms are a huge threat to traditional players. | Integrate traditional offering on sharing economy platforms or launch new businesses based on this approach. |
Travelers want efficiency and personalization. | Established businesses that don't evolve may become obsolete. | Personalize products/services. |
Travelers need hourly based stays. | Industry not adapted for this need. | Launch new product/services based on hourly stays. |
You have at your fingertips the opportunity to (re)invent your organization and make the world a better place.
Every industry sees occasional disruption. However, the frequency of that disruption is accelerating as exponential technologies impact both business models and the environment in general.
As Thomas Edison said, “To have a great idea, have a lot of them.” This week you will generate as many ExO Core Initiative ideas as possible in order to ensure success.
Adapt your current organization to external industry disruption to protect it from the threats disruption poses and to take advantage of the great opportunities continually emerging from that disruption.
MTP | ExO Core Initiative Name | External Disruption | Internal Reaction |
Personalized eco experience for everyone | Smart Eco | Decreased margins due to growth of sharing economy; travelers want more efficiency and personalization. | Automate as many processes as possible using AI; robots replace some staff members. |
Short eco stays | Travelers want option of booking on an hourly basis. | Update hotel pricing and technology systems to allow hourly bookings. | |
Personal room | New virtual reality (VR) technologies could reduce desire to travel. | Equip hotel with VR technologies that enable those not staying at the property to travel virtually and “meet” with hotel guests. |
Experimentation is crucial to any innovative project.
By definition, any innovative idea under consideration is a hypothesis (or a set of hypotheses), which means it (or they) will need to be tested prior to development. The first set of hypotheses to evaluate should be the external disruption/internal reaction pairs defined last week.
Of the 10 ExO attributes that the ExO framework defines, Experimentation is the one that must always be included.
This week you will focus on running experiments to evaluate your hypotheses. There is no better place to start than by asking the people involved in the ExO Core Initiatives what they think about them.
Think through the design of your experiments before beginning them. Results should allow you to evaluate the external disruptions and better define the right internal reaction, not just answer the question, “Is this a good idea?” How you construct the interview questions is very important. Issues to consider in advance: How can you ask questions creatively? How will the results allow you to improve the initiative? Clearly define what will determine the success of an experiment, including what thresholds need to be met.
Prioritizing experiments is important, since you may have so many hypotheses to evaluate that you won't have time to run them all.
Ask for honest feedback. Invalidating a hypothesis is not bad; in fact, it's an important part of the innovation process. Either outcome results in great learning and progress.
The next step is to run the experiments you have defined. In addition to conducting further research on external disruptions, you'll also interview users/potential clients (to evaluate disruptions/reactions) and/or tech people (to evaluate product feasibility). Reach out now to arrange calls and meetings. Your goal with these interviews is to gather actual data.
After running the experiments, it's important to spend sufficient time analyzing the results. You will evaluate all hypotheses, improve the ExO initiatives based on what you've learned, and make a final evaluation of the improved ExO initiatives.
The Build-Measure-Learn loop provides a set of useful guidelines for running ongoing experiments and will help you learn as much as possible (your primary goal at this juncture).
Use the template in this section.
Eric Ries' The Lean Startup introduces the Build-Measure-Learn loop and is a great reference for how to run these processes.
Your number-one asset at this point is actual data, since the goal of the Build-Measure-Learn loop is to base all your decisions on solid data and not on opinions or intuition.
Ask for honest feedback. Invalidating a hypothesis is not bad, it's part of the innovation process. Remember: The main goal is to learn!
A great way to implement the Experimentation attribute is by introducing the Build-Measure-Learn loop as an ongoing process within your organization. Ongoing identification and testing of hypotheses will increase learning and move you in the right direction.
Define and run experiments
BUILD | MEASURE | LEARN | |||
ExO Initiative Name | Key Hypotheses | Experiment Description | Evaluation Criteria | Experiment Results | Key Learnings |
Smart Eco | Eco travelers desire increased efficiency and personalization. | Interview 10 eco travelers using the Customer Development interview template. | At least 60% of potential clients should validate hypothesis. | 90% of potential clients validated hypothesis. |
Hypothesis Validated Clients would like to personalize room features (e.g., room temperature, specific requests). |
Eco travelers like the idea of robots supplementing human staff. | Interview 10 eco travelers using the Customer Development interview template. | At least 60% of potential clients should validate hypothesis. | Only 20% of potential clients validated hypothesis. |
Hypothesis Invalidated Eco travelers like the idea of robots but only for specific services. |
The perfect flow for this week:
Interviews are always preferable to surveys since they provide greater insight, especially when you ask open-ended questions. If, however, you need to evaluate multiple ideas, surveys are more efficient.
The idea is to run experiments for all external disruption/internal reaction pairs defined. If you have one or two disruption/reaction pairs per team member, we recommend assigning one or two initiatives per team member to run experiments. If you have more than two initiatives per team member, consider running a much bigger but more superficial experiment by sending surveys to potential clients instead of conducting direct interviews.
To evaluate different types of hypotheses, reach out to external advisors who are specialists in your industry or in a specific technology or methodology.
Different ExO Core Initiatives may share the same group of people to be interviewed. In that case, ask the group about the different ExO Core Initiatives at the same time.
Remember that getting out and talking to customers and colleagues is the only way to turn your hypotheses into facts.
It's time to select your top ExO Core Initiatives and take them to the next level.
Next week you will present your ExO initiatives at the Disruption Session and receive feedback that will help you improve your projects.
This week's assignment is to work on the presentations for the upcoming Disruption Session, which entails a five-minute pitch for each of four initiatives. You will present your project to the company's leadership team, the other members of the ExO Sprint, and a select panel of ExO Disruptors.
The first task is to pick the top four ideas to present at the Disruption Session. To narrow your options, evaluate each initiative according to the previous week's results (experiments and key learnings) and the following criteria:
All decisions should be data-based, so select projects with strong evidence to support them.
All remaining ExO initiatives should be filed away for possible development in the future.
If some ideas don't rate as ExO Core Initiatives but qualify as ExO Edge Initiatives, it's possible they can be repositioned. Instead of building a particular ExO Edge Initiative, consider defining a new ExO Core Initiative that would react to the ExO Edge idea under consideration (and which may be already happening in the world). For example, if you are a hotel chain considering building a new online platform offering hotel rooms (an ExO Edge Initiative), the idea could be transformed into a ExO Core Initiative by focusing on building the APIs that the hotel chain would need in order to connect with the original ExO Edge Initiative's platform.
Give each initiative a compelling title that makes it easy to understand, along with a one-line description.
To test how well your initiative enables the organization to adapt to external industry disruption, ask the following: Will this initiative help us face external threats or take advantage of industry disruption?
In order to ensure your organization will be set up to adopt the ExO model—and thus adapt to external disruption based on the abundance being generated in your industry—the ExO Canvas will prompt you to think about how to leverage each of the 10 ExO attributes. Design an ExO Canvas for each of the disruption/reaction pairs defined in the previous step. Each represents a different ExO Core Initiative.
Run a brainstorming session using the blocks in the ExO Canvas as steps for the ideation process.
Use the ExO Canvas template.
Review the ExO Canvas section on defining each of the ExO attributes. Pg. 72
Remember to include the MTP/TP in your ExO Canvas.
Remember to include the MTP in the ExO Canvas of each of the ExO initiatives. All ExO Core Initiatives should share the MTP you defined for the organization.
Create a five-minute pitch and supporting presentation for each of the ExO initiatives to be presented.
At this stage of the process (idea-stage ExO initiatives), we recommend composing an elevator pitch—a summary of each idea that could conceivably be delivered during a standard elevator ride. An elevator pitch is usually delivered in 60 to 90 seconds, but in this case, you're going to a write a five-minute version.
The elevator pitch should include the following items:
Explain why your organization exists, demonstrating how the specific ExO Core Initiative will help it achieve the MTP.
Describe the external disruption that triggered the ExO Core Initiative.
Present the internal reaction, focusing on how you will address the external disruption, the value it will provide, and how it will make the organization more adaptable and even scalable.
Discuss the ExO attributes you will use the most, identifying those that will help the organization reach abundance and those that will help manage that abundance.
There are thousands of great websites dedicated to describing how to prepare and deliver elevator pitches.
For an ExO Blue Core Initiative (focused on a product/service), check out the Pitch Canvas, an online brainstorming tool that helps entrepreneurs visualize an entire pitch on one page.
Include actual data from the experiments. Cool ideas are valuable but validated ones are even better.
Storytelling is a great way to present an elevator pitch.
Get your pitch down on paper so you can practice it repeatedly.
Time management is important, so create a pitch you can deliver in five minutes without having to rush.
You may want to create slides to accompany your extended elevator pitch.
If you opt for a presentation, keep it simple, using only a few inspiring and informative images and graphs.
Use the presentation template in this section.
A good book to help you prepare is Garr Reynolds' Presentation Zen: Simple Ideas on Presentation Design and Delivery, which describes using simplicity and storytelling to reach an audience.
Include some context about the organization, since external disruptors who don't know much about your organization may attend next week's session.
Whenever possible, use pictures instead of text for your slides. You want people to listen to what you have to say rather than be distracted by reading your slides.
Using the ExO Canvas to design your ExO initiative is helpful. However, you don't need to share it during the presentation. Instead, explain the individual pieces using other, more visual and creative means.
You will be presenting a large number of ideas, so each pitch should be concise and to the point. The more you practice, the better you will do.
Practice, practice, practice!
Your pitch, your voice, and your passion.
External feedback is great at this point, so share your presentation with your team and anyone else you can.
Time management is important, so practice as much as possible.
A relaxed and natural delivery is key, so again, practice as much as possible.
ExO Canvas for Smart Eco
Your template should include the following slides or sections:
It's imperative that you begin the presentation with the MTP/TP.
Note that all ExO Core Initiatives will share the same MTP.
In general, use just one slide to introduce the MTP.
Discuss the external disruption, which is the main driver of the ExO Core Initiative.
Once the nature of the disruption is clear, introduce the internal reaction that will either prevent the fallout from the disruption or leverage the opportunities it can bring.
Show how you will reach abundance (using the SCALE attributes) and how you will manage that abundance (using the IDEAS attributes).
You may want to Include the ExO Canvas and explain how each of the key ExO attributes applies to the ExO Core Initiative.
The perfect flow for this week:
Include actual data from the experiments. A great performance is always a plus, but in the end, it's only a nice deck. There is always much more value in providing data and insights (e.g., testimonials) from clients, stakeholders, and users to illustrate what you have learned.
Running further experiments is always a good idea if you have the time. The more data you have, the better—especially in the case of any ExO initiatives that were developed the previous week—in the event that some hypotheses were invalidated. You now have the opportunity to run more experiments on the new ExO initiatives (which are actually new hypotheses).
It's time to disrupt your company before someone else beats you to it!
This week's assignment provides an opportunity to present your most promising ExO initiatives to a group of disruptors, who will then provide feedback on how to improve them.
Remember: Failure is part of the process. If some ExO initiatives are rejected post-presentation, don't take it personally. It's better to fail fast and cheap now than to fail later after having invested a lot of time and money.
Based on the feedback you receive, you may end up killing some of your ExO Core Initiatives. On the flipside, you may create new ones that will complement your portfolio. Always keep your eyes and ears open for new opportunities!
Create the right environment for the presentations.
You can deliver the presentations either in person or online, depending on everyone's location and the parameters of your budget. If the Disruption Session is held in person, consider decorating the space to create a unique atmosphere. If you conduct it online, test the video conferencing system in advance. Note that if the ExO Sprint is running both an ExO Edge Stream and ExO Core Stream, the Disruption Session will include teams for each.
Follow an established agenda for each presentation, allowing 60 minutes for each team to present all four of its ExO initiatives, with a short break between each. Present each of the four ExO initiatives within five minutes, followed by five minutes of feedback.
Time management is the key to presenting effectively. Communicate your agenda in advance, including the order of the presentations.
The big moment has arrived! It's time to present your ExO Core Initiatives for feedback.
Each team will have 60 minutes to present its ExO initiatives and receive feedback. The presentations will be given to the company's leadership team, the other ExO teams and a group of ExO Disruptors made up of three to five people from outside the organization who have specific experience in your industry or of innovation in general.
After each presentation, the audience will offer five minutes of feedback. We recommend limiting this part of the session to feedback only, with no questions allowed. At this stage, the goal is not to sell the initiatives but to learn.
Record all presentations for later review.
Take note of all feedback received from your peers and the disruptors. Everything you hear is valuable. Keep in mind that this set of presentations, combined with the feedback you receive, is yet another aspect of the experiments you've been running, and is included to improve your ExO initiatives.
Classify the feedback into different categories, one of which may include new hypotheses. Also remember to gather feedback about potential ExO initiatives.
Use the feedback template.
It is particularly important for ExO Core team participants to listen to the ExO Edge presentations, since the external disruptions they address must be taken into account when building ExO Core Initiatives. The idea is to make the organization's ecosystem compatible with itself.
You will likely receive two types of feedback:
You will have a debrief meeting with the management team to determine which of the ExO Core Initiatives is aligned with the general direction the leadership team wants to go. The management team also has the option of picking one of the MTPs presented—or even defining a new one.
Remember that although you may have come up with amazing initiatives, some may ultimately fall outside the scope of what the company's leadership team has defined for the ExO Sprint.
We recommend that the ExO Head Coach meet with the leadership team separately to facilitate the decision-making process.
The leadership team may be inclined to select the ExO initiatives it wants to see move forward, but we suggest the group limit itself to recommendations (to avoid acting as the corporate immune system) and leave the ExO Sprint teams to make their own decisions. That said, be prepared for the possibility that the leadership team may make the final call.
Even though the organization doesn't yet have a defined MTP, it's possible that it has already been working with an unofficial version. In that case, pick the MTP that aligns most closely with the organization's identity.
We recommend providing the leadership team with actual data when it comes to feedback. For example, providing ExO Disruptors with an online survey to complete during the in-person presentations ensures further comments and feedback are captured for later review at the leadership debrief meeting.
It's time to select the most promising initiatives and take them to the next level. Digest the feedback received in the Disruption Session and during the meeting with the leadership team and pick the top three ExO initiatives (or those the management team chose).
The leadership team may have already made a decision about which initiatives to back or to kill. If so, accept the decision and try not to be too disappointed if more ExO initiatives than anticipated are scratched off the list. Rejection and failure are part of the process; don't take it personally. Just keep being awesome!
Picking the top three initiatives is not just a matter of choosing the ones that received the best feedback. There may be other reasons: alignment with the selected MTP, something strategic, or a gut feeling.
Remember you can also create new ExO Core Initiatives based on the feedback received during the Disruption Session or in response to ExO Edge Initiatives presented by other teams. The goal is simply to have three ExO Core Initiatives by the end of the week.
Review the work you've done on the ExO Core Initiatives so far and refine them after taking all feedback into account. If you have any new ExO Core Initiatives, draft as many of the main elements (MTP, disruption/reaction pair, and ExO Canvas) as you can and use the following weeks to catch up.
In the event that the leadership team has already selected a definitive MTP for the organization, you will need to update and align your ExO Core Initiatives in response.
Follow the previous weeks' assignment descriptions to refine your initiatives.
The goal with the Core Stream is to make the company more adaptable to the external environment. Do your ideas qualify?
The Disruption Session can highlight where participants need to do further work to fully understand the ExO model and concepts. Take time this week to address any gaps in understanding. For example, does everyone on the team have a good grasp of the ExO attributes? Do they understand what it means for an initiative to be scalable? Do they see where their MTPs can be improved? Revisiting some of the initial concepts might have greater impact now that the team has experience applying them.
At this point in the ExO Sprint, we recommend splitting the team into subgroups and assigning each subgroup one or two initiatives. For example, if there are six team members, you can split the team into three groups of two team members and assign an ExO Core Initiative to each. No matter how you organize the groups, it's important that all team members offer feedback on all initiatives, regardless of their level of involvement.
Feedback Form | |||
General Feedback | Alignment with Leadership Objectives? | ||
Smart Hotel | Leadership team liked this business objective! | Yes | |
MTP | Leadership team chose this MTP for the organization. | ||
External Disruption | Leadership team and ExO Disruptors agree that the concept will be disruptive to the industry. | ||
Internal Reaction | ExO Disruptors suggested improvements to the business model (e.g., storing customer data as a resource). | ||
ExO Attributes | ExO Disruptors suggested improvements to the ExO attributes (e.g., build a smartphone app featuring an intelligent assistant to complement personalization services and robot assistance). | ||
(Initiative Name Here) | |||
MTP | |||
External Disruption | |||
Internal Reaction | |||
ExO Attributes | |||
ExO Edge Initiatives that Led to New ExO Core Initiatives | AirEco will increase competition in the marketplace as a result of decreased staffing needs and margins. An internal reaction to this ExO Edge Initiative could be to launch an ExO Core Initiative to provide hotel staff services to AirEco. This would allow AirEco to offer guest services using professional hotel staff. It also creates an opportunity for the existing organization. | ||
Other Feedback (General, Other Projects, etc.) | |||
Final MTP/TP for the Organization | Personalized eco experiences for everyone. |
The perfect flow for this week:
The right ExO Core Initiative(s) should be:
You are applying the ExO framework to make your existing organization more adaptable to external industry disruption; all initiatives should aim for this objective.
Since you will define a Massive Transformative Purpose (or at least a Transformative Purpose), you may need to increase the existing organization's reach. If so, evaluate whether the ExO Core Initiatives will help scale the impact.
Designate one team member in charge of writing down all feedback. It can be a different team member for each initiative. Just make sure all feedback is captured.
After the presentations, discuss your initiatives with the attendees (the management team, members of other ExO Sprint teams, and the ExO Disruptors) and request additional feedback.
As always, remember that failure is a part of the process, so try not to get upset about any negative feedback you receive. It's better to know sooner rather than later that you may need to change, hold off on, or even kill one or more of your initiatives.
If some (or even all) of your ExO initiatives are rejected following the Disruption Session, don't take it personally! This is just part of the process.
We have worked with teams whose ExO initiatives were all killed off during the Disruption Session but by the end of the ExO Sprint their new or improved initiatives were the most highly rated. Consider this session a learning exercise and an opportunity to improve your initiatives and process.
It's time to take your ExO initiatives to the next level!
This week's assignment is to formally define the assumptions underlying your ideas and prepare to test them further.
Start by defining your ExO Core Initiative in greater detail so that you can identify the key hypotheses to test.
Next on the agenda is to begin building a Minimum Viable Product (MVP) that facilitates learning more about your ExO Core Initiative and how to improve it.
Are you worried you won't be able to accomplish all this in only one week? You can!
During the previous weeks, you have identified external disruptions and defined internal reactions that will help adapt your organization to the external environment. You should also have defined which ExO attributes to implement.
It's now time to think more deeply about the implementation details of the ExO Core Initiatives in order to identify key hypotheses and test them as soon as possible.
Since you may have different types of ExO Core Initiatives (internal projects designed to increase the flexibility or efficiency of the organization, new products or services, etc.), each will need to be further defined. Regardless of how you define your initiatives, be sure to address the following issues:
Who will use or buy the solution you are defining? What are their pain points and needs? What value will your solution deliver?
Who within the organization will approve and fund your ExO initiative? What is the value it offers stakeholders?
What will your ExO Core Initiative look like once completed? What will be the user's experience of it? What will you need to implement it?
What will it cost to implement the initiative? How will your organization benefit? What is the return on investment?
There are several tools that will help further define your initiatives:
Empathy Map
Customer Journey Map
Value Proposition Canvas
Blue Ocean Strategy Canvas
Your own method
Value Proposition Design, by Alex Osterwalder, will help with the Value Proposition Canvas.
Blue Ocean Strategy, by Renée Mauborgne and W. Chan Kim, will help with the Blue Ocean Strategy Canvas.
You can find plenty of online information about how to use the Empathy Map, Customer Journey Maps, and other tools.
For Pure Core Initiatives and Edge Core Initiatives, use the tool that best fits the project you are considering. For example, if you are thinking of developing an AI-based decision-support system for your staff, consider using an Empathy Map. if you are thinking about how to improve or automate the processes of your organization, you may want to base your use case on a process map.
For Blue Core Initiatives, use an Empathy Map or Value Proposition Canvas to better understand your customer. Use a Blue Ocean Strategy Canvas to define the innovative product or service.
If none of the suggested tools work for your ExO Core Initiative, invent or modify one on your own.
Research the economics of the initiative. This might entail calculating the cost of the ExO initiative and the return on investment (high accuracy is not necessary at this stage), or the pricing model of your product/service and its profitability.
When building ExO Core Initiatives, we generally recommend using external technology providers and not building the technology in-house (there's no need to reinvent the wheel). For an Edge Core Initiative that might become a new ExO Edge Initiative in the future, we recommend using external technology providers for a first internal prototype and then looking into building the technology yourself once your “ExO on the Edge” has been launched.
When your ExO Core Initiatives have been defined in greater detail, consider reviewing and improving their ExO Canvases as well.
To analyze the scope and impact your ExO Core Initiatives would have within your existing organization, include the different elements the ExO Core Initiative would contribute to your current business model (all without changing its foundation).
When updating the Business Model Canvas, add new sticky notes as needed to see how the original business model is being impacted by including the ExO Core Initiative.
Use different color sticky notes so it will be easier to identify how the organization's business model has been improved.
Remember that an ExO Core Initiative doesn't change an organization's business model; it improves it. If the initiative in question alters the way your company does business, the idea is a potential ExO Edge Initiative.
Eric Ries, who launched the Lean Startup movement, defines an MVP as “a version of a new product which allows a team to collect the maximum amount of validated learning about customers with the least effort.” In terms of an ExO project, the idea is to use the MVP concept to build something that will help you learn about your initiatives. Before designing and building your MVP, however, consider the outcome—i.e., think about what you want to learn as a result of building and testing it.
The next step is to identify the key hypotheses to evaluate—those that are critical for the success of your ExO Core Initiatives. At this stage, most of the hypotheses will be found in the ExO Canvas, the Business Model Canvas, and based on what you learned from further defining your ExO Core Initiatives (the previous task):
Use the template in this section to identify and evaluate hypotheses. At this stage you only need to fill in the Build column (or columns), including the key hypotheses you're evaluating and the experiment design details. The table's Measure and Learn columns will be fleshed out in the coming weeks.
Each ExO Core Initiative is different, so think about the critical factors that will make your business a success. These are the key hypotheses to evaluate.
To define the success criteria of the sales experiment (especially for ExO Blue Core Initiatives), define meaningful metrics for the process. The right metrics are usually expressed as a percentage that reflects the conversion rate of potential customers from one phase to another. Example: percentage of potential clients who buy the product. This is known as Innovation Accounting.
You don't need to implement your ExO Core Initiative to start testing and learning about it. There is no need to waste time and money building something that no one might want to use or pay for. Instead, experiment with an MVP.
Before developing that MVP, determine the minimum set of features it should have at the outset. To do so, follow these steps (note that some will have already been addressed in previous tasks):
Eric Ries' book The Lean Startup is a «good source for learning about MVPs and the foundation underlying the concept.
Remember that your goal here is not to see your ExO initiative implemented perfectly but to develop a product that allows you to learn. To that end, include learning-oriented features and add-ons that will result in further feedback.
You should already have a better definition your ExO Core Initiative, Including what the first MVP might look like.
It's now time to build the MVP, test it with potential users and stakeholders, and compile feedback.
There are several techniques you can use to build your MVP. Some are focused on building an actual prototype, others on simply presenting the idea to potential users and stakeholders. You will need to pick the one that works best for your ExO initiative based on the amount of time you have to build the MVP. To that end, consider combining the following techniques:
Develop a landing page that shows and describes your MVP. (This applies mainly to Blue Core Initiatives and other initiatives based on launching a new product or service, where the goal is to evaluate a value proposition with potential clients.) You can also describe the complete version of the product or service, although we recommend focusing the landing page on the key features of the MVP. In addition to describing your product or service (either the MVP or a complete version), encourage clients to pre-order. Another option is to run an A/B test, which consists of building two different versions of the landing page—each with a different value proposition—and see which visitors prefer.
Visit www.launchrock.com and www.landerapp.com for help creating a landing page.
A bit: how clients like the value proposition of your product/service and its price based on the number of pre-orders the website receives and the actual data you gather.
Create a video that shows and promotes your MVP. Again, this technique is useful when evaluating the value proposition for clients and internal supporters.
Use a professional video creation service or online tools such as www.animoto.com or www.goanimate.com.
A bit more: how users and stakeholders like the value proposition of your ExO Core Initiative based on their reactions after watching the video. Encouraging clients to pre-order can result in data about the price and revenue model.
Build a set of wireframes or digital designs that will help illustrate for clients what your product will look like. This technique is useful when evaluating the value proposition for clients and internal supporters.
Use any rapid prototyping tool like www.invisionapp.com, www.justinmind.com or even PowerPoint.
Even more: how the users like the value proposition of your ExO Core Initiative and its details based on their reactions and interactions with the wireframes. Encouraging clients to pre-order can also provide data about the price and revenue model.
Build a prototype that includes only the key features you want to learn more about. This is actually the real MVP, and in many cases it's possible to build it in just a few days. Remember, it doesn't have to be perfect; it just needs to be something that will help you learn over a several-day period.
A lot: how easy or hard it is to build and deliver the actual ExO Core Initiative; how users, clients, and stakeholders like the value proposition; and what the user experience is like based on interactions with the prototype. Encouraging clients to pre-order can also provide data about the price and revenue model.
The Lean Startup offers great ideas on how to build MVPs in just a few days. Another good book is MVP, by Paul Vii, which provides tips for creating an MVP using Agile Development Methodologies.
Compiling a list of prioritized features and the number of hours that each will take to develop will tell you whether or not it is possible to have a prototype ready within the next week.
Business Model Canvas for Eco Places (Parent Organization)
ExO Canvas for Smart Eco
Template to identify and evaluate key hypotheses
BUILD | MEASURE | LEARN | |||
ExO Initiative Name | Key Hypotheses | Experiment Description | Evaluation Criteria | Experiment Results | Key Learnings |
Smart Eco | Customers are willing to book a room in a hotel with AI-based personalization services, assistants, and robots. | A/B testing with two landing pages (one with current offering and another with Smart Eco initiative) to determine which receives more bookings. | At least 60% of visitors prefer the AI-based approach. | ||
Building AI-based services, assistants, and robots is feasible. | Talk to AI companies to evaluate whether it's possible to build AI-based personalization services. | Find AI providers able to build AI-based personalization services. | |||
AI-based services provide value. | Build a prototype to test hypothesis. | More than 60% of customers should be happy with the experience. |
Designing the MVP
FEATURE | IMPACT (VALUE) | COST (MONEY) | EFFORT (TIME) | PRIORITY |
Landing page | 1 | 2 | 2 | 5 |
First prototype of AI-based personalization service for controlling room temperature | 1 | 1 | 1 | 3 |
First prototype of AI-based assistant | 2 | 0 | 0 | 2 |
First prototype of AI-based robot | 2 | 0 | 0 | 2 |
Simulation of AI-based assistant backed by a human | 2 | 2 | 1 | 5 |
Conclusions about the MVP
After analyzing the different features and options, we decided to design a simple online landing page offering two versions of the MVP. Next up: Conduct A/B testing to determine whether customers preferred our value proposition over the existing one.
In the end, we opted to build a simulation of the AI-based assistant that features a smartphone-based app with a simple, human-backed interface. The goal: to ascertain what kinds of interactions customers like best and embed those interactions within the final, automated version of the app.
The perfect flow for this week:
Build something that you can use to test your value proposition with users.
For online channels such as landing pages, don't forget to implement some mechanism to gather feedback (e.g., contact forms) and data (e.g., stats engine).
Keep in mind that next week you will use whatever you build now to reach potential users, clients, and stakeholders and learn from them.
You will develop your MVP further next week, but it's important to get an initial version up and running now. If you want to produce an actual prototype but need two weeks to develop it, we recommend developing another kind of MVP in the interim, such as a presentation. You can at least gather data while getting the prototype ready for the experiments you'll be conducting in two weeks.
It's time for the truth!
Over the past week, you have been building initial versions of your MVPs, which will allow you to learn more about and improve your ExO Core Initiatives.
This week's assignment provides experience exercising the Experimentation attribute at a deeper level. The goal is to test your MVPs so that you can determine if your value proposition is the right one.
Using Experimentation to build and test your MVP enables you to evaluate the key hypotheses to determine whether the ExO Core Initiative you are developing will help adapt your organization to external disruption.
If any of your ExO Core Initiatives entail developing a new product or service, you may be able to attract clients. Getting your first client is one of the most exciting milestones for any new organization, so let's do it!
An early adopter is an individual or business that uses a new product or technology before others, shares your vision, and is willing to try your MVP even though it may not yet have been perfected. Your job here is to define how to find early adopters and get their buy-in for your ExO Core Initiatives.
The technique used to find early adopters depends on the type of ExO Core Initiative and MVP you have developed:
For Blue Core Initiatives (new product or service):
If you created a landing page MVP, focus on online channels in one of three ways:
If you've created a sales presentation, a set of wireframes, a video, or a real prototype, focus on offline channels to reach early adopters:
For Pure Core Initiatives and Edge Core Initiatives:
Regardless of the type of MVP, you need to identify a variety of early adopters:
Decision-makers within your organization who will approve and fund your ExO Core Initiative
Employees who will use and benefit from your ExO Core Initiative
Potential clients who will use and benefit from your ExO Core Initiative
For Blue Core Initiatives: Steve Blank's book The Startup Owner's Manual outlines how to find and sell to early adopters. Familiarize yourself with the section of the book that covers the Customer Validation phase of the process.
Another book for Blue Core Initiatives: In addition to a great way to learn about selling to early adopters, Geoffrey Moore's Crossing the Chasm addresses how to expand your target market in the future.
When it comes to ExO Core Initiatives, there are two groups of early adopters:
(Your ExO Core Initiative improves an existing product or service; alternatively, your initiative entails creating a new product or service)
Share the vision you have about the future
Have the problem you defined some weeks ago
Are trying to solve this problem in some way, although not yet successfully
Are paying to solve the problem
Are honest and will provide valuable feedback
(Your ExO Core Initiative improves an existing organization and you have internal approval and/or usage)
Acknowledge the external disruption you are trying to manage
May already be reacting to this external disruption in some way, although not yet successfully
May be investing (or willing to invest) resources to manage this external disruption
Are honest enough to provide valuable feedback
To find early adopters, try to think as they do. This will help you identify new places to locate them.
Remember that your goal is to learn, so interact with your early adopters as much as possible.
After building and testing your MVPs, you will have a lot of experience and data to use in evaluating your key hypotheses.
ExO Core Initiatives shouldn't be implemented across the organization as a whole, at least not at first. In addition to finding early adopters, you'll also need to determine exactly where in the organization to begin the implementation process.
Once the sales process is complete, the next step is to dig into the data you've gathered.
Use the template to identify and evaluate the hypotheses you were working with last week and fill in the Measure and Learn columns.
Remember to analyze the qualitative data as well as the quantitative data (metrics). At this early stage of the game, qualitative information is more important than quantitative.
Experimentation results often produce a lot of noise but digging into the data also presents learning opportunities. For example, after evaluating a new product or service, you might find that certain customer segments love your product or service while others hate it. In fact, your results might indicate that people under 45 years of age love it and those over the age of 45 don't. The learning here? Focus the product or service on the customer segment aged 45 and under.
Template to identify and evaluate key hypotheses
BUILD | MEASURE | LEARN | |||
ExO Initiative Name | Key Hypotheses | Experiment Description | Evaluation Criteria | Experiment Result | Key Learnings |
Smart Eco | Customers are willing to book a room in a hotel with AI-based personalization services, assistants, and robots. | A/B testing with two landing pages (one with current offering and another with the Smart Eco initiative) to determine which receives more bookings. | At least 60% of visitors prefer AI-based approach. | Landing page featuring the AI-based approach resulted in 50% more sign-ups. | Hypothesis Validated |
Building AI-based services, assistants and robots is feasible. | Talk to AI companies to evaluate whether it's possible to build AI-based personalization services. | Find AI providers able to build AI-based personalization services. | Unable to find an AI provider to meet all our requirements. Most requirements, however, can be met with some restrictions. For example, due to technical limitations, AI providers recommend limiting use of robots to room delivery for now. They also note that technical capabilities will significantly improve over the next couple of years. |
Hypothesis Partially Validated We learned that we can't develop everything we want, but if we limit robot functionality to room delivery for now, we can launch a first version that can be improved over the next couple of years. |
|
AI-based services provide value. | Build a prototype to test hypothesis. | More than 60% of customers will be happy with their AI experience. | As many as 80% of customers love AI-based personalization services. |
Hypothesis Validated We found that customers most frequently request that meals be delivered to their rooms. They love that the intelligent assistant remembers their preferences, especially when they arrive at a new hotel within the chain. |
The perfect flow for this week:
The goal for the week is to compile enough data from the experiments to ensure valid results (and thus additional learning). What would be even better, of course, is if you are able to sell your idea during the process, an outcome that would impress the panel at your final ExO Core Initiative presentation. From nothing to real customers in less than 10 weeks–Let's do it!
Remember that early adopters are not just first clients or internal supporters. They are also special people and/or companies with a specific mindset.
To aid in your evaluation of different types of hypotheses, you may need to reach out to external advisors who are specialists in your industry or in a specific technology or methodology.
Last week you should have learned a great deal about your ExO Core Initiatives as a result of testing your MVPs. This week, you will continue to develop your MVPs by running experiments.
At some point during the week, when you have enough data, it will be time to face reality and make the necessary changes to your ExO Core Initiatives to maximize your opportunities for success.
Refine your ExO Core Initiatives!
Just two weeks to build and test an MVP may not seem like enough time. Despite the quick turnaround, however, it is possible.
Allot several days this week to run experiments and iterate your MVP based on what you've learned.
If you are still running experiments with early adopters, continue using the template to identify and evaluate the hypotheses you have been using over the last two weeks.
Insights gleaned from the experiments with early adopters will provide you with new ideas and thus, potentially, new hypotheses. Keep the hypothesis definition and evaluation process dynamic. The idea is to use what you learn to redefine your experiments on an ongoing basis.
We recommend exploring Agile Development Methodologies (such as Scrum), which are basic techniques for developing and evolving an MVP. The main premise of these methodologies is to continually redefine features and development priorities for your product so that you can iterate it in a few days or weeks. Even if you don't use the techniques during the course of the ExO Sprint, it's a good idea to have a working knowledge of them for possible future use.
Once you have gathered enough information (or don't have any more time to run additional experiments or further develop MVPs), it's decision time.
Based on what you've learned, here are the next steps for your ExO Core Initiatives:
Update the previous elements defined—the ExO Canvas, the MVP's requirements, and any other element or canvas used—and look for ways to further improve the ExO initiative so that it best fits the needs of users and stakeholders.
Update the previous elements defined—ExO Canvas, Blue Ocean Strategy Canvas, the MPV's requirements, and any other element or canvas used—and look for ways to further improve the product or service in a way that fits the needs of customers. You should also finesse the pricing model to maximize the likelihood that customers will be willing to pay for that product or service.
To edit your business model, use the Business Model Canvas you worked on earlier in the ExO Sprint. Pg. 131
Iteration of your product or service may require updating your product backlog if you are using Agile Development Methodologies (unlikely given the time constraints of an ExO Sprint).
For Blue Core Initiatives, there are several ways to iterate your product or service:
Carefully consider the feedback your clients, users, and stakeholders offer and re-prioritize your MVP's features as needed. Don't forget the Build-Measure-Learn loop, which is applicable to everything!
ExO Canvas for Smart Eco
Business Model Canvas for Eco Places (Parent Organization)
The perfect flow for this week:
Making changes to your ExO initiatives may prove challenging (it's not easy letting go of ideas you're attached to), but don't respond by initiating the corporate immune system! Instead, build the best ExO initiative possible.
Keep all decisions data-based. Staying neutral often requires setting your ego aside and releasing any attachment to favored ideas or proposals.
In order to evaluate different types of hypotheses, you may need to reach out to external advisors who are specialists in your industry or in a specific technology or methodology.
Remember that within the ExO Sprint process everyone is equal and there is no room for corporate hierarchy. In short, decisions should never be based on corporate seniority.
Time to prepare for the final presentation!
Next week you will present your best ideas to the leadership team. The goal is to elicit additional feedback and, most important, secure the funding needed to further develop the chosen ExO Core Initiatives.
This week is dedicated to creating a comprehensive presentation to showcase the awesome work you've done throughout the ExO Sprint.
Select the most promising initiatives in advance of the final presentations.
Given what you've learned from running the experiments, you should be able to discard some of the ExO initiatives and focus on the two most promising options.
Anticipate the evolution of your ExO Core Initiative and define key milestones for the upcoming 12 to 18 months. You'll also want to estimate your budget and associate milestones with the investment needed to reach them.
If you can, try to calculate the Return on Investment (ROI) of your ExO initiative. Take into account, however, that it is very difficult to accurately calculate ROI for innovative projects, so whenever you present these numbers be sure to emphasize that they are preliminary.
Key milestones may include:
For estimating revenues, create a set of business parameters that take into account the innovation accounting metrics you defined and experimented with the previous week.
When it comes to estimating costs, be realistic about the resources and external help you will need to achieve your milestones. Milestones should align with easy-to-approve funding amounts.
If your ExO Core Initiative is heavily dependent on an emerging technology, your milestones may reflect the interim steps that will prepare your organization to adopt the technology as it matures.
Create a sequence of manageable milestones. For example, a milestone might test the concept with a small market segment. It could also test an individual component of the initiative.
To prepare for next week's final presentations, you'll need to develop a deck for each of your ExO Core Initiatives.
For this round, instead of using the short elevator pitch format, you will produce longer, more comprehensive presentations for each of the ExO initiatives. Follow the outline in the templates found later in this section.
Use the presentation template in this section.
A helpful book is Garr Reynolds' Presentation Zen: Simple Ideas on Presentation Design and Delivery.
Whenever possible, use pictures instead of text for your slides. You want people to listen to what you have to say rather than be distracted reading your slides.
Craft a story that makes a compelling case for the initiative, beginning with the problem space and including a clear definition of the initiative's value proposition. Is the concept easy to understand? Is its value obvious?
Don't worry if you end up killing one or more of your initiatives. Although you should present at least two ExO Core Initiatives at the Launch Session, you can always resurrect any of the initiatives you were working on prior to the Disruption Session. Be sure to develop any new additions as much as you can, following the process outlined over the previous weeks.
Keep in mind that you will have just 15 minutes to present each initiative.
Start practicing as soon as possible!
Each presentation should include the following slides/sections:
In order to frame the ExO Core Initiative, it's imperative to begin each presentation with an MTP.
In general, use just one slide to introduce the MTP.
It's also important to explain the external disruption, which is the main driver of the ExO Core Initiative. If the disruption comes from an ExO Edge Initiative, don't forget to mention that.
Once the external disruption is made clear, introduce the internal reaction that will either enable you to avoid the threat coming from external disruption or leverage the opportunities that threat can bring.
When communicating new ideas, it's helpful to use storytelling techniques.
One option is to invent a story and illustrate it with pictures and diagrams that explain the problem and how your solution solves it.
We recommend using case studies if you are presenting six or fewer initiatives. Count on five minutes to present each initiative.
It's a good idea to show how your ExO Core Initiative fits within your organization's current business model.
You'll want to illustrate how you are improving and adapting your business model to external industry disruption (as opposed to changing it).
Since you are both adapting the organization to external industry disruption and connecting it to external abundance, it is important to illustrate how you plan to reach that abundance (using the SCALE attributes) and how you will manage it (using the IDEAS attributes).
Present the ExO Canvas and explain how the ExO attributes apply to the ExO Core Initiative.
Outline important milestones for the next few months.
You'll also need to describe long-term milestones, applying exponential thinking and summarizing how you plan to achieve your MTP.
Estimate the budget needed to achieve short-term milestones.
The perfect flow for this week:
Be creative with your presentation format. For example, teams may want to augment their standard presentation with sound and video.
Include actual data from the executed experiments in the presentations. A great performance is a plus, but in the end it's only a nice deck. There is always more value in providing data and insights (such as testimonials) from actual clients to illustrate what you've learned.
The big day is here!
This week you will present your ExO Core Initiatives to the company's leadership team and selected advisors, who will then make a final decision about which initiatives to fund and further develop.
The selection process is not the end—far from it, in fact. The development of your ExO Core Initiatives marks the beginning of your organization's transformation process!
Create the right environment and set up the logistics for the presentations.
Presentations can be done either in person or online. Much depends on where people are located and the size of your budget. If you present in person, consider decorating the space to create a unique atmosphere. If you conduct the presentations online, test the video conferencing system in advance.
Follow an established agenda for the presentation (we've included an outline below), which should take between 60 and 90 minutes depending on the number of ExO Core Initiatives presented. Allot 15 minutes for each presentation, followed by a 10-minute Q&A session. Schedule a short break before the next event.
Time management is the key to presenting effectively. Communicate your agenda in advance, including the order of the presentations.
Teams will present their ideas to the leadership team and other relevant stakeholders. In contrast to the Disruption Session presentations, this time around the team will both receive feedback and answer questions.
The final presentation format is longer than that for the Disruption Session, which relied on the elevator pitch technique.
Two books that can help you improve your presentations are The Presentation Secrets of Steve Jobs: How to Be Insanely Great in Front of Any Audience and Talk Like Ted: The 9 Public-Speaking Secrets of the World's Top Minds, both by Carmine Gallo.
We recommend a 10-minute Q&A session per initiative.
After the presentations are over, the leadership team and selected advisors will convene to make a decision about which ExO Core Initiatives will move forward and how much funding to allocate to each.
Initiatives must be evaluated from the point of view of how the ExO Core Initiatives will make the organization more adaptable to external industry disruption by avoiding threats and/or leveraging opportunities. In addition, the leadership team must also be careful not to take on the role of the corporate immune system.
The templates in this section will aid the leadership team in evaluating which initiatives to fund.
To help preempt an immune system reaction on the part of those members of the leadership team who are not participating in the ExO Sprint, we once again recommend that ExO Disruptors be included in the final presentation evaluations, just as during the earlier Disruption Session, held Week 5. Their independence from the organization (and its leadership) promotes honest, unbiased feedback.
Remember that old-school, traditional thinking may not work here, so avoid input and recommendations that come from that mindset. This can prove challenging if you are an industry insider!
Keep in mind that these are still early stage initiatives, and much can change in the coming months. For now, it's important to maintain a high-level perspective—focusing on the purpose and goal of the ExO Core Initiatives—rather than zeroing in on the details.
The leadership team doesn't need to fund the chosen initiatives in full; it can follow a lean approach, allocating only enough funding to achieve the next milestone.
It's generally a good idea to determine the total amount of money you want to spend in the phase immediately following the ExO Sprint. Split the sum among the different initiatives according to your expectations for each.
Choose the teams that will oversee further development of the ExO Core Initiatives. Teams should include some of the ExO Sprint participants who developed the initiatives.
Informing the ExO Sprint participants which ExO initiatives have been chosen for funding and further development is key to keeping the momentum going.
It's important to keep all ExO Sprint participants engaged, whether or not their initiatives are selected. Be sure to communicate your appreciation of a job well done. Everyone will have completed an incredible amount of work in a short period of time!
One way to keep everyone engaged and have them share in the outcome is to offer all ExO Sprint participants (including ExO Edge team members, if applicable) a percentage of the future profits generated from the ExO Core Initiatives.
Final day presentations agenda template
ExO Edge Initiative | Is Initiative Aligned With ExO Sprint Scope? | Does Initiative Adapt Existing Organization to Industry Disruption? | Does Initiative Make Existing Organization More Scalable? | Is Initiative Viable? | Selected? | Funding Allocated |
Smart Eco | YES | YES | YES | YES | YES | $150K |
When it's time to share your ExO initiatives with everyone, relax and enjoy the moment.
Practice as much as possible and keep working to improve your presentation.
It's important to make an announcement about the selected initiatives, the funds allocated to each, and who will develop them further.
Pay attention to any personal transformation ExO Sprint participants may have experienced during the ExO Sprint. Some of them will be ready to jump into the ExO Core Initiatives selected. Be open to supporting new career paths!