Technology is a key resource for businesses. As technology managers, our job is to direct technology activities to serve the business and its customers. This requires coordination and integration of technology activities with all functional areas of the firm.

“The ultimate purpose of Strategy: a plan, method, or series of maneuvers or stratagems for obtaining goals and results using the right amount of effort.”
—Integrated Strategy Development: Unsurpassable Advantage by Binnur

Technology strategy is shaped within the context of the business. Typically focused on the 3-5 year horizon, its goal is to capture the intent and behaviors for proper utilization and exploitation of technology for the long-term success of the organization. With that, here are the five essentials that need to be addressed in our technology strategy:

1. Technology is the root of the business: So say we All!
2. Technology operates as a system: Resistance is futile
3. We need habits and rituals: Life is a pilgrimage
4. Building our tribe, our ecosystem
5. And finally… Establish technology commandments

For additional ideas on developing technology strategy also check out Your 2011 Technology Development Agenda. 

Technology is the root of the business – So say we All!

Technology for technology sake does not work. Our technology strategy lays the foundation to support our business, and leads our products and customers. To do that, we need to understand what business we are in, and where and how we need to innovate.

What business are we in is an important question as it guides an organization in every facet of its decision making. Fundamentally, it orchestrates how the value is created and delivered, for the firm, its customers, employees and shareholders (Strategy 101: What business are you in.)

To understand where and how we need to innovate, we need to drill down to the profit equation (profits = revenue – cost) and analyze it in the context of technical areas (Innovation and Profitability.) And then, we need to take it a step further and look at how we are competing in the market within the scope of generic competitive strategies (differentiation, segmentation, low cost, fast follower, hybrid, etc.) These steps are important, as it answers not just the why, what and who but also how and when questions.

This analysis establishes the basis of our technology vision and mission: the role our technology will play in our overarching business vision (our inspiration), and the path we will follow to achieve our objectives (our purpose.) This is a starting point, a rough cut of our technology vision and mission. Next, we need to look at internal and external forces and continue to validate our vision and mission as new information emerges.

Technology operates as a system – Resistance is futile

We live in a world, where everything is interconnected, embedded in systems within systems with many connections and interaction points. With that, as our technologies evolve, our behaviors evolve; and as our behaviors evolve, our technologies evolve. Simply, as a closely coupled system, we coevolve: our technological capabilities, social norms, policies, standards and more.

As we work on our technology strategy, we need to acknowledge our technology as part of this larger ecosystem. This boils down to:

1. taking a stock of the technological competencies and capabilities of our firm;
2. analyzing key internal and external assets required for orchestration of its commercialization, realizing that business strategy influences technology vision (and vice versa);
3. modeling our technology as part of this larger ecosystem, and capturing major forces influencing and driving its evolution, including the STEEP forces (and vice versa).

This helps us establish the lay of the land, including a good understanding of the potential shifts, close couplings and gaps that exists. In summary, we answered key questions that are important for our success:

• what technologies are strategically important (core and enabling) with their lifecycle potential;
• how is the firm positioned to deliver with current assets, capabilities and resources, and what are the gaps;
• what are the opportunities and threats with existing and potential competitors and competing technologies;
• how to position the firm towards a given technology and competing technologies: standards, alliances, IP;
• how much to invest for what degree of market entry, performance levels and when;
• how to ready the organization, processes and partners for successful delivery;
• what are the risks and how best to mitigate and address them;
• how to accelerate technology adoption;

We now have our technology vision and mission fully formulated: the role our technology will play in our overarching business vision (our inspiration), and the path we will follow to achieve our objectives (our purpose.) Next, we need to focus on execution.

For more information, check out:

• How to identify forces impacting your innovation
• Strategy 101: What is your core competency
• Create value at every touch point
• Strategy 101: Spot technology expectation gaps via technology life cycle

We need habits and rituals: Life is a pilgrimage

“We are what we repeatedly do. Excellence, then, is not an act, but a habit.”
—Aristotle

Technology strategy is a living system that constantly evolves with changing business environment, new opportunities and threats, processes and technologies. To top that, strategy is only as good as its execution.

“essence of strategy “is not doing something better than your competitors but doing something different – choosing a unique and reliable position that is rooted in systems of activity that are difficult for others to match.”
—Porter

So, our technology strategy needs to clearly articulate the intents and behaviors that will be developed and adhered to, specifically in the areas of:

• capabilities to develop and acquire;
• processes to integrate and adopt;
• operational aspects of implementation and follow thru.

Building our core competency and ensuring that we maintain sustained differentiation takes effort and focus. Using this triage of capabilities + processes + operations, we can design the optimum trade offs for key dimensions of our technology:

• cost
• availability
• quality
• functionality
• performance
• other factors: social, environmental and policies

As we create the rituals and habits to revisit and check our progress, we need stay flexible. Though we are outlining our intended strategy, given day to day changes that occur in the environment, we need to be sensitive to the emergent strategies. As a technology manager, our job is to deal with complex, dynamic, uncertain environments while continuing to focus on value creation and value capture for our organization. So, we need to evaluate and incorporate those emergent strategies back into the business.

For more information check out:

• Strategy 101 – Why building a successful strategy is hard
• Key factors for successful strategy execution
• Roadmaps and roadmapping: what and why
• Technology strategy 101: Competing technologies… Friend or foe

Building our tribe, our ecosystem

Technology as a single cell organism is not interesting, its commercialization is what brings value to the organization and the society. And, this requires support and collaboration of all functional areas and partners.

In simplistic terms, the ecosystem encapsulates the concept of a community of things and the environment in which they live. In the world of technology and business, this community includes organizations and individuals such as producers, suppliers, competitors, and other stakeholders contributing goods, knowledge, and other deliverables.

By building our ecosystem, we are enabling and encouraging everyone else to make our products better and more valuable. However, the “if you build it, they will come” strategy does not work. We need to not only ensure that we ourselves are successful, but also clearly articulate how our ecosystem partners will flourish. This includes sharing our vision and beliefs about the future, information about our customers, providing incentives and rewards that are financial and motivational, establishing communication channels; basically building an environment where we can all grow and prosper.

For more information on building ecosystems, check out Open the door and let me in.

And, finally… Establish technology commandments

Commandments basically boils down to all the shalls and shall nots of our technology platform. At the core, they reflect and identify our position and philosophy on specific technology related issues. Each of these should be captured as simple points, to ensure clear understanding by ALL parties involved (internal and external, including ecosystem developers). Some areas to consider as follows:

• privacy
• quality
• security
• usability
• sustainability
• performance
• development guidelines

Forgive me, as it has been a long time since I blogged… But, I have been lured to the exotic world of iPhone and Mac programming, and learning kept me challenged, focused and engaged, not to mention, distracted from writing…

Before I fall back to the temptations of programming, let’s dive into my article. I will be discussing strategy and the importance of building an integrated, interweaved, interdependent strategic system to create an unsurpassable competitive advantage, one that Sun Tzu would be proud of.

Unfortunately, as an over used term, strategy can also be seen as strategy soup: technology strategy, product strategy, portfolio strategy, brand strategy, HR strategy, market strategy, service strategy, IP strategy, operational strategy, social media strategy, sustainability strategy, … However, it is the integration, interweaving and coevolution of all these pieces that create strong strategic positioning for your company.

“Those who win one hundred triumphs in one hundred conflicts do not have supreme skill. Those who have supreme skill use Strategy to bend others without coming to conflict.”
— Sun Tzu, Art of Strategy

Sun Tzu saw the world as a complete and interdependent system that must be preserved. For him, brilliant strategists would rarely go to battle, as they would achieve their objectives well in advance of any confrontation: “For to win one hundred victories in one hundred battles is not the acme of skill. To subdue the enemy without fighting is the acme of skill.”

That is the ultimate purpose of Strategy: a plan, method, or series of maneuvers or stratagems for obtaining goals and results using the right amount of effort. In the context of a business, strategy builds on the organization’s mission, setting its long-term direction to achieve competitive advantage.

Porter's strategy formulation context

Establishing specific goals and performance metrics, managing resource allocation and budgets, agreeing where and by whom the value will be created and captured, the level of intimacy and engagement with customers and partners, what skills we need to develop and what opportunities we need to pursue are all part of the strategic planning process. It all boils down to:

1. how do we achieve superior economic performance;
2. how do we deliver unique differentiated value proposition to our customers;
3. how do we build our culture and organization for continuous sustained success so we can repeat #1 and #2 indefinetely.

Impermanence: strategy as a continuous process

“Plans are nothing; planning is everything.”
— Dwight D. Eisenhower

Everything changes, and with that strategy is a continual process; it is not a one-time effort. Given that, why strategize?? Because strategy:

• clarifies the direction and vision of the whole by setting specific goals and performance metrics;
• is an enabler for aligning decision making in an organization and creating focus: driving the whole organization towards its vision;
• forces you to think about not only how to advance and protect your competitive position, but ways develop it to encourage people to join and support you;
• provides a structured approach to organize your thoughts about all the complexity in your world and its evolution as conditions change;
• is designed to ensure you are asking the difficult questions and view the whole: where do we want to be, how will we know when we get there, where are we now, and what will change in our environment in the future…

The foundation of strategy

Porter's wheel of competitive strategy

Michael Porter describes the foundation of strategy as the activities which an organization chooses to excel in: differentiation arises from both the choice of activities and how they are performed. In essence, through this integration and interweaving of the system of activities, the organization creates a sustainable strategic position. Here are some thoughts to munch on…

Technological innovations drive change and enable growth. In high-tech businesses, technology and corporate strategy are tightly coupled. As technology strategy looks to add value to the business, it also brings its own mindset with unstated assumptions and biases about customers, partners and business practices. In return, it influences how products are built and businesses make money. I suspect, we’ll have plenty of interesting examples to talk about as Nokia transitions from Symbian and the MeeGo mobile platform to Microsoft’s Windows Phone 7 over the next few years.

Platform strategy encompasses a general sharing of components, underlying technology elements and processes across a range products, such as Apple’s unibody laptop engineering and manufacturing, Microsoft Windows platform and the like. As a strategy, it is focused on delivering increased efficiencies through improved learning curves and economies of scale. On the HP front, we should see more on their webOS platform, and how it may be integrated across HP’s computing and printer lines over the next few quarters.

And, when firms partner with key players outside the company, they can create a powerful network effect (value of the product/service increases as more people use it) ultimately leading to establishing an industry platform. A firm’s technology choices, how it manages relationships with partners and competitors, and its processes and practices all play into its success. As an industry platform leader, the firm is now depended on the complementary contributions from the broader, interdependent ecosystem, and with that they will let go of some level of control. Take note of the Linux, Apache, and Eclipse platforms which are managed via non-profit foundations, with Apple’s App Store and the semi-constant backlash from the community, or how open Google Android really is.

Product strategy is focused on the customer: who are they, what benefits to deliver, and why they would choose you over your competitors. With close ties to technology strategy, careful considerations need to be given to product lifecycle and technology adoption when it comes to designing and deploying the actual product.

And, when we start talking about when/how to bring this product to market, how to manufacture it, and how to support/service it, we are touching marketing, manufacturing, operations as well as support and service strategy.

As Drucker pointed out, the purpose of a business is to create a customer. As I highlighted before, all these pieces of strategy boil down to:

1. how do we achieve superior economic performance;
2. how do we deliver a unique, differentiated value proposition;
3. how do we build our culture and organization for continuous sustained success so we can repeat indefinitely.

Integrated and interdependent system

As the wheel of competitive strategy demonstrates, none of these strategic pieces are meant to be decided and managed in silos. Though planning is usually seen as a top down process, in reality, it is an agile system, and it requires interaction and intelligent exchange at all levels.

Firms rely on cross-functional Product Management Teams to integrate, influence and resolve conflicts that come up through strategy disconnects during product development. While these teams do a great job of managing change within the box, the majority of required business level strategic shifts will not be addressed, even if it means the end of the business…

Agility is key for a company to maintain its competitiveness in the marketplace. Some corporations are better than others when it comes to mobilizing and shifting strategy at the business level. It could be the leadership, as in the case in 1996 with Bill Gates, when he turned Microsoft around on a dime and refocused everyone on the Internet. For Amazon, it is their culture, competencies and organizational structure that enable them to develop and execute on an integrated strategy: if you think it, and if your idea supports the business strategy, then the rest of the business evolves to support it. Amazon Cloud, Fulfilled by Amazon, Warehouse deals, Amazon Prime are all such examples.

As in these cases, we are looking at a strategic system that is integrated, interdependent, and that co-evolves with itself, other systems, and its surroundings. If you can achieve that system, you can bend others without coming to conflict, as Sun Tzu states.

Leveraging the power of strategy

Strategy development is one thing, effective strategy execution is another. Here are some thoughts on how to ensure your organization is ready and willing:

• make sure your strategy is understood: translate it into terms that every one of your employees at any level would be able to understand and act upon;
• establish organizational structure that enables individual strategies to be linked, integrated, and can initiate change as needed;
• build accountability and results into the organization so every individual looks to contribute to the success of that strategy in their day-to-day activities;
• establish a process for learning, adapting and evolving strategy – instead of an annual event, strategy becomes a continual process;
• and, as strategy evolves to reflect shifts in opportunities and threats, ensure that your organization can handle the change accordingly.

If you can achieve this level of agility and mobility in your organization, you won’t need luck.

First, definition of touchpoints by Albert Tan from frog design mind: a touchpoint is the moment upon which a sensory interaction results in an emotional/psychological one. … The touchpoints that are part of your brand and marketing strategy — moments people interact with a brand from initial awareness to evangelism — are all opportunities to engage with your audience in richer, more vivid ways.

Next, series of posts from Harvard Business Review blog by Adam Richardson looking at customer experience: what it encompasses, how to structure it, how to approach and improve it.

In Understanding Customer Experience, Adam defines customer experience as:  the sum-totality of how customers engage with your company and brand, not just in a snapshot in time, but throughout the entire arc of being a customer. Recognizing the challenges of fully controlling customer experiences, he emphasizes the importance of springing these experiences from concrete, controllable elements — the touchpoints.

Following, Adam moves onto mapping out your customer journey in Using Customer Journey Maps to Improve Customer Experience. Customer journey map is a diagram that illustrates the steps your customer(s) go through in engaging with your company. As part of the framework discussion, he shares an example of the home theater journey from the point of awareness to the out-of-the-box experience, with further emphasis on understanding the customer actions, motivations, questions and barriers at each step. Adam also shares additional resources for creating customer journey maps in this article.

Finally, in Touchpoints Bring the Customer Experience to Life, Adam discusses how an organization can orchestrate touchpoints — a touchpoint being any interaction point between the customer and your brand. Adam highlights four general categories for looking at touchpoints: products, interactions, messages, and settings. And, he concludes that this integrated look at touchpoints requires multiple parts of a company, and often outside partners, to work together to improve the experience.

What do you think is missing from these discussions? Given I just heard about Delicious service potentially shutting down, my thoughts are around how poorly we tend to handle disposing aspect of our customer life cycle… And, as we depend more on software running on the cloud, with new startups continuously entering into the space, how will our customer experience and more importantly expectations will change?! Finally, what would be the impact to the rest of the ecosystem of products, companies and customers, as some services will bloom while many others won’t… Reflecting back at one of my favorite books, I suspect we are in the verge of entering the Brave New World!

Let me be honest… This post was inspired by my quest to better understand design thinking: what it is, how it is different, why it matters, and most importantly how is it going to save us all!? I don’t believe in silver bullets, and question deeply when a new buzzword starts floating around. But, the more I thought about it, the more I realized my question is irrelevant — design thinking merely represents another way of looking at the world, and I should add it to my toolkit. Here is an old Zen story to hammer my point.

A wise farmer’s livelihood depended on his horse. But, one day his horse ran away. His neighbors said “Oh, how bad for you!”. The farmer responded,  ”What’s good… What’s bad… Who knows?” A few days later, his horse returned with a herd of wild horses. Of course, the neighbors were the first to congratulate his good fortune. Again the farmer responded, “What’s good… What’s bad… Who knows?” But then, the farmer’s only son broke his leg while taming one of the wild horses. And again, the farmer responded to his concerned neighbors with, “What’s good… What’s bad… Who knows?” When the army came through the village conscripting all the young men, neighbors congratulated the farmer that his only son was spared. And again, the farmer said, “What’s good… What’s bad… Who knows?”

What matters is that we live in a complex world, where everything is interconnected, in ways we don’t understand. And, we continuously need to look for ways to improve and expand our approach to problem solving, and add them to our toolkit for big picture thinking. From the context of technology and product management, this article will highlight a small subset of better thinking methodologies that I utilize often and would like to learn more about.

There is so much to ‘thinking’ that just thinking about it can be overwhelming — to see what I mean, spend some time browsing Wikipedia’s Portal:Thinking. Individually, each of these tools adds diversity and unique perspectives to my thinking; collectively they make me a better thinker. I look forward to hearing about your processes and insights on our journey towards better thinking. For a list of my favorite resources on becoming a better thinker, check out my bookshelf.

“Many an object is not seen, though it falls within our range of visual ray, because it does not come within the range of our intellectual ray, i.e., we are not looking for it. So, in the largest sense, we find only the world we look for.” — Henry Thoreau

Critical and Creative Thinking

Critical and creative thinking are the must have foundation for better thinking. They are two sides of the same coin. The problem solving process goes something like this:

Critical thinking, the left-brain function that emphasizes logical thinking and reasoning, is all about objectively assessing, judging and evaluating. Creative thinking, right-brain function, targets originality and curiosity to discover hidden connections and generate new ideas. With that, we not only produce unique ideas and connections, but also apply rigor and discipline to our thought processes.

It is also crucial to realize that our thought processes are fallible. We are not only emotional, but our brains work extra-hard to maintain and protect the natural order we come to believe and expect. With that, critical and creative thinking require:

• willingness to step away, question and experiment;
• curiosity to explore possibilities and connections;
• openness to dive into the new, unknown and uncomfortable;
• skills for effective communication and sharing.

Systems Thinking

As our technologies evolve, our behaviors evolve; and as our behaviors evolve, our technologies evolve. Simply, as a closely coupled system, we coevolve. So, as neo-Darwinism highlights, when we change the way we do things, or when a new technology enables activities, the result is a natural selection of new technologies and behaviors which best fit with the change.

Systems thinking acknowledges the fact that we are a complex organism, embedded in systems within systems, with many connections and interaction points. While a few of these interactions and interdependencies we may be able to control, there are many we cannot control, but could still influence. The result is patterns of behavior and structure that are developed through various feedback loops which are inherent in the system. In summary, systems thinking emphasizes that:

• the whole is more than its parts and cannot be deduced from studying its parts alone, much like the story of blind men and the elephant;
• behavior of the system can only be understood in the context of its environment;
• purpose and function of the system is critical to answer the question of why they do what they do, while interconnections in the system and flow of information answer how they accomplish what they do;
• through understanding the interactions, interdependencies, relationships and the system’s purpose, we can influence the system behavior.

Systems thinking is valuable at understanding behaviors, and how change of behaviors would change the performance of the system. This understanding can help us drive change, test how the system would adapt in response to feedback, or what is needed to maintain stability. Given that, our results are only as good as the models we develop, and not surprisingly, our models fall short of representing the real world fully.

Design Thinking

Here is my boiled down definition: applying design principles and methodologies to our thinking. For some, this definition may fall short as design thinking seems to be positioned as the next Holy Grail.

With its origins rooted in design process, design thinking emphasizes human elements: empathy, design for emotion, embracing constraints. As a social and inclusive process, it highlights just enough prototyping for learning, where we pick what we want and need to learn. It also aims for balance through desirability, viability and feasibility.

Design thinking can help strengthen our world model. For insight into real-world challenges and applications, take a listen to TEDxChange: The Future We Make webcast.

Visual Thinking

A big part of being a better thinker is about learning to see and learning to communicate. Isn’t a picture worth a thousand words? We live in a world that is highly visual, where meaning is generated and communicated through signs, symbols and what we choose to share and sometimes not share.

Visual thinking tools push our creative side and enable us to look for unrelated connections, boil down complex ideas to bite-size concepts, connect through storytelling, facilitate learning and imagination. Visual thinking strategies (VTS) are used to improve our critical thinking skills through discussion of visual images to develop thinking skills that use detail in order to enhance understanding. For more on VTS, take a look at their VTS in action videos.

I have been doing a 365 digital photo project on Flickr. It has been a great tool for me, as I dive deep into the technology and science of photography, while I learn first hand about seeing and making meaning. Mind maps are well known for brainstorming, generating and organizing ideas. Along with mind maps, sketching, sketch-notes, storytelling, data visualizations, storyboards, wireframes are tools that are used often in our visual thought processes, and they are great tools to pull together quick prototypes.

Lean Thinking

Inspired by Japanese manufacturing concepts, and agile software process thinking, the basic premise of lean and agile thinking is to maximize value while minimizing waste. At a high level, both look at how to best structure pieces and parts in a way that would deliver rapid value.

In our complex world, agile and lean thinking enables us to understand the system in small steps, build in frequent feedback utilizing lightweight processes to make continuous refinements to our big picture view, and be adaptive as change is inevitable. Whether you have a blank canvas or an existing system to start with, these thinking tools help you focus on what matters.

Last thoughts… Strategic thinking

I would not classify strategic thinking as yet another thinking methodology. To me, mainly used in the context of business, strategic thinking is about applying our best thought processes in order to identify and implement unique opportunities to create value for a specific objective. Again, it is about analyzing/formulating AND implementing/driving change.

McKinsey Quarterly’s “Thinking strategically” article highlighted the following strategic thinking rules:

• Strategic thinking seeks hard, fact-based, logical information.
• Strategic thinking questions everyone’s unquestioned assumptions.
• Strategic thinking is characterized by an all-pervasive unwillingness to expend resources.
• Strategic thinking is usually indirect and unexpected rather than head-on and predictable.

These thinking methodologies that I highlighted, and many others I have not, will help support your journey towards being better strategists. And, I invite you to share your own gems with us.

1. culture enforces and feeds what makes you successful; and
2. culture is a living system that supports and nourishes itself.

Also, back in 2007, I wrote an article that emphasized why you should care about your organization’s culture. Now, it is time to focus on how to explicitly define your culture, and document your secret sauce.

Recently I had a good discussion on whether one should even attempt to define one’s culture, given Heisenberg and the uncertainty principle. Though it is a valid argument, there are benefits to knowing thyself. If you are an acronym heavy culture, develop cheat sheets to help newbies navigating through your acronym soup. Or shift your email/IM heavy culture with voice and face-to-face communications to spur collaboration and minimize misunderstandings. Yes, change occurs, and your culture naturally evolves. Knowing what is the keystone of your success, and what cultural elements you need to evolve mindfully is the focus of this article.

Now, without further ado, let’s identify the key aspects and interactions of your culture through the following steps:

1. Calibrate your compass
2. Identify your key ingredients
3. Let them simmer
4. Distill and serve

Step 1: Calibrate your compass

When the going gets tough, when hard decisions need to be made, where do you turn to? What do you use as your guiding principles to ensure your decisions are aligned to support your firm’s success? For IDEO, it is their hot groups (The Art of Innovation: Lessons in Creativity from IDEO, America’s Leading Design Firm) and how their culture supports the success and creativity of these groups. For Amazon, it is their customer focus and desire to become the most customer-centric company on earth, but also the recognition that they are in the manufacturing (logistics, warehousing, fulfillment) and distribution business (Strategy 101: What business are you in?).

Good to Great: Why Some Companies Make the Leap… and Others Don’t emphasizes the Hedgehog Concept to capture what distinguishes good companies from great ones.

The Hedgehog Concept is a simple crystalline concept that flows from deep understanding about the intersection of the following three circles:

• What you can be the best in the world at;
• What drives your economic engine;
• What you are deeply passionate about.

Your recipe for success lies at the intersection of these three key dimensions, and your translation of that insight into a simple crystalline concept. Once you have your recipe, you are ready to place out your ingredients on the kitchen counter.

Step 2 – Identify your key ingredients

There are many ways to slice and dice what contributes to culture. In my research, I identified seven key ingredients that must be looked at individually, and then together as to how they support each other and your success recipe.

• People — Company employees are one’s first introduction to your culture. As first impressions count, who you hire, how they talk and behave will say a lot about your company at a first glance.
• Customs — All your rituals, stories, spoken and unspoken rules indicate what is acceptable, how one should behave in certain conditions and most of all, what behavior is valued by peers and management.
• Values — Values reflect one’s attitude and opinion towards people and things. These include what is worthwhile, desirable, useful and important, which in turn influences our behaviors and decisions.
• Structure — These include organizational structure, as well as unwritten lines of influences, power structures, information flow and decision processes. We have a tendency to compensate for incompetence in the form of bureaucratic structures followed with complex processes and policies.
• Work space — This represents the visual aspects of the company, its work space and environment that houses all involved. Everything from how the individual work spaces are designed, to meeting rooms, logos and other symbolic items (including dress codes) give insights into your culture.
• Processes & policies — Processes and policies highlights how your organization is controlled, measured and managed. How they support and align with the rest of your organizational identity will help or hinder your intended culture.
• Vision — Vision is all about the future aspirations, desires and possibilities. It acts as your guiding light to support your secret sauce to success. Though it may be vague, your vision weaves itself into the fabric of your organization’s culture.

For an individual analysis, start by asking questions, such as the ones I have suggested below. These questions can focus on the current state as well as the future desired state of your culture. For a group discussion, post-it notes are a good tool to capture, organize and prioritize information. If you are doing this as an individual, I like using the Cornell System of note taking to capture my thoughts. This allows me to record my information in the rightmost column, and add my insights and observations on the left hand column. Whatever the method you may use, make sure to capture current and future desired states of your culture separately to help with your simmering and distillation process.

Ingredients of Culture - Analysis

Step 3 – Let them simmer

Though the individual analysis gives you a good insight into each aspect of your culture separately, it is important to put it together as a system to see how the ingredients interact. Using mind mapping process, you can see the linkages between each ingredient and dig into how cultural traits support each other.

If your mind map lights up like a christmas tree all over, it is a sign that your cultural traits are integrated throughout. As a living system, this highlights a strong infrastructure, where each element supports and nourishes each other. If some of the main cultural ingredient branches are more integrated than others, it highlights the areas to ponder further. If there is hardly any linkages between the branches, you are probably looking at a very bland sauce…

Step 4 – Distill and serve

Once you simmer the ingredients together and gathered the needed insights, the next steps are driven by the outcome desired. To identify ways to improve the current state, or to develop a future desired state, focus on the traits and the interactions, and how as a system they support your success/hedgehog concept. By utilizing gap analysis (from where you are to where you want to be), you can develop action plans to get to the desired state.

As part of your analysis, it is important to identify cultural traits that are endless, that should be preserved as the keystones of your culture. These keystones represent your firm’s central building blocks that forms and bonds your firm’s identity. Understanding what is changeable and what is foundational will allow you to mindfully evolve your culture.

Technorati Tags: culture, defining culture

Culture is one of those overloaded terms… So much so that, Alfred Kroeber and Clyde Kluckhohn have compiled a comprehensive 160+ definitions of culture in Culture: A critical review of concepts and definitions. Our current take on culture originates from Sir Edward Burnett Tylor’s all-inclusive definition of culture in 1874 .

“Culture or civilization, taken in its wide ethnographic sense, is that complex whole which includes knowledge, belief, art, morals, law, custom, and any other capabilities and habits acquired by man as a member of society.”

— Sir Edward Burnett Tylor

Applying this to organizations,  I see culture as how we get things done in an organization that collectively makes us successful. With that, culture:

• is a learned behavior;
• is shaped by our values, goals and expected moral/ethical conducts;
• is spread thru social interaction — it adapts, evolves and changes;
• is complex — embodies tangible and intangible characteristics (beliefs, attitudes, habits, customs, tools, rules, rituals, …);
• can be broken down into simple traits (creative, innovative, agile, …). But, as with a recipe, knowing the list of ingredients does not translate to THE secret sauce.

Culture is built around what people think is important, and leaders establish and drive the culture of their organization. If you doubt that, check out Japan’s Cool Biz campaign, and how the Prime Minister Koizumi influenced the Japanese business dress code to help reduce electric consumption usage during summers.

Now, I have to reemphasize success in this definition, as without success there is no point to culture… Is there?!  I like this more extensive definition of culture:

A firm’s culture, “encompasses its history and accomplishments, its leaders’ ambitions and goals, its definition of and criteria for excellence, its attitude about clients and staff, its traditions and lore, its mood and energy, and its balance between art and business.”

Jean Valence, Symmes Maini & McKee Associates (original article)

Analyzing an organization’s cultural traits

Culture is unique — it is complex and operates as a system. This makes it a key differentiator and a competitive advantage. Its secret sauce is difficult to change and imitate. The fact that it is difficult to observe culture makes it harder to understand how it leads to success. But, it is possible to observe behaviors and identify traits in your culture, which are necessary for success. Here is a laundry-list of needed traits for today’s global, fast-paced environment: flexibility and agility; agile and adaptable; learning culture; startup mentality and entrepreneurship; empathy; collaboration every which way; …

Or, here is a look at cultural traits of design firms, based on my readings on IDEO and others. Note that the success of design firms depends on their ability to identify options, making choices, understanding constraints and addressing/executing them that leads to delivering great experiences. From that, key ingredients for a vibrant design firm culture include (but are not limited to):

• creatives — willingness and desire to step outside the box and experiment;
• learners — curiosity and a high degree of empathy driven by observation, experimentation and desire to share experiences;
• improvisers — eagernes and ability to deal with whatever;
• playfulness — whether it is bringing beginner’s mind to the task at hand, or just wanting to be different;
• agile structure — evolves and changes with the needs;
• way of thinking — set of tools, processes, etc. that enables creating new experiences and mindsets;

And, here is yet another way to look at culture from Business Insider with a look at 3 types of startup cultures by Nilofer Merchant: family, wealth and deep optimism.

In summary…

Your culture should enforce and feeds what makes you successful. It is a system that supports and nourishes itself. Here is a look at XPLANE’s culture map (and the annotated version at Flickr) that beautifully illustrates this concept. In the future posts, I’ll dive deeper into exploring this system….

Technorati Tags: culture, organizational culture, cultural traits

What is product design? From Wikipedia: “Product design is concerned with the efficient and effective generation and development of ideas through a process that leads to new products.” Yes, product design is a process… A process with one important objective: create a customer!

“The purpose of a business is to create a customer.”

– Drucker

However, unless we are philanthropists, we need to be profitable as well. As I mentioned before, the profitability equation is quite straightforward: if a firm’s revenue from selling its product or service is greater than the cost of offering it, then the firm is profitable. So, product design process is focused on:

1. creating value for the customer, so a lot of someones will buy our products, AND;
2. be effective and efficient at using our tangible and intangible resources, so our costs are comparatively lower than the value we create for our customers.

With that, product design guides our product strategy. It allows us to bridge the gap from where we are to where we want to go. It helps to answer the three main strategy questions:

• Where are we?
• Where do we want to go?
• How will we get there successfully?

Product design aims to find the “perfect balance” as it manages competing priorities and constraints between desirability + viability + functionality.

• desirability — what do they want and need?
• functionality — what form + behavior it should take?
• viability — what competencies and capabilities will make us successful?

Product design is frequently relied upon during new product development, and often at the fuzzy front end. But, it needs to play a much bigger role:

• In the product materials lifecycle
• In the product development funnel
• At all customer touch points
• And, even in our value delivery system.

Additional thoughts…

• Product design is about people. Focus on “transactions” between people and things.
• Validation should be your first step.
• Technology is an enabler, not a solution.
• A product is more than the sum of its parts.
• Match your product to its adoption curve.

Technorati Tags: product design

This article is not specifically about cloud computing technology, but about the insights it has spawned… However, for anyone that is interested, my cloud computing solution comparison notes are here; I also recommend Above the Clouds: A Berkeley View of Cloud Computing.

As I studied and researched cloud computing solutions from Google, Amazon and Microsoft, I came to realize how much of corporate personality spills into our technological creations, you could say we create in our image… One could argue, this is all about branding. And, as a Buddhist principle states that all views are empty of inherent existence, I would not argue: views rather depend on who is looking, and when, and for what purpose. However, I see branding as a conscious and explicit activity, while our process of creation is unconscious representative of our true-selves.

As I was reading Ackoff’s The Art of Problem Solving: Accompanied by Ackoff’s Fables, I had a humorous insight into the personality of Google, Amazon and Microsoft. Ackoff indicated that the philosophers of ancient Greece divided the pursuits of man into four major categories:

1. The scientific: the pursuit of truth;
2. The political-economic: the pursuit of power and plenty;
3. The ethical-moral: the pursuit of goodness and virtue;
4. The aesthetic: the pursuit of beauty;

Other than my obvious oversimplification, here is what I noticed as I was pondering over my notes…

Amazon Web Services (AWS)

Amazon has put together perhaps the most comprehensive and mature set of services. As their solutions are easy to comprehend and most portable from the development and deployment perspective, they should appeal to the IT-minded folks. Initially what has started as an infrastructure (IaaS) approach is now progressing towards platform solution (PaaS). Leveraging their core competency of operational excellence, Amazon has given the control to its customers, including the management of data and application deployment locations around the world.

With all that, Amazon is utilizing the pay-as-you-go service. Though this is certainly appealing, looking through the pricing terms felt like I would be nickeled and dimed even IF I really paid attention to my application design… (Note that the need to design-for-the-cloud applies to all cloud computing technologies in general.) With that, I place Amazon on the pursuit of the power and plenty column.

Google AppEngine

With the motto of do no evil, Google automatically moves to the category of pursuing goodness and virtue. Google’s AppEngine approach is in complete support of this pursuit, working to deliver cloud computing vision to anybody with as little effort as possible. Using a platform approach (PaaS), Google delivers automatic self-healing, self-scaling applications. All one has to do is to develop within the Google’s framework, follow their best practices, and everything else will be handled auto-magically.

Following Google’s tradition of giving away large quotas, AppEngine is also free up to a certain level of usage per-day. In addition, the developers can set daily budgets where Google Checkout is available. Pricing as well as the development environment would attract startups and Open Source community, which would continue to give more goodness back to the Google’s ecosystem. However, the customers’ lack of control over the infrastructure can challenge and raise further concerns for privacy and security in the cloud (see Forrester’s Interactive Data Protection Heat Map.)

Microsoft Windows Azure

In typical Microsoft fashion, the Windows Azure platform has something for everyone, including a flat-rate pricing structure. Designed as a platform approach (PaaS) with the possibility to provide infrastructure control (IaaS) in the future, Azure is a hybrid-cloud focus bridging enterprise and the cloud. Windows Azure also introduces a different development approach to cloud computing with the concept of Web roles and Worker roles to support auto-scaling via software. In order to encourage adoption and lure developers, Azure supports whatever programming language you want to use, from .NET to Java to Python.

Though one may question, it feels like Microsoft is in the pursuit of truth with what seems like constant drive to redo/rewrite/re-architect/re-invent, while solving everyone’s problems and converting them to their platform. Borrowing from Karl Marx’s argument, are they the opiate of the people?

If Apple was in the ring, and there are rumors of future Apple cloud computing services, I would classify them as the pursuit of beauty. Just think, the most beautiful, completely controlled cloud-based AppStore that brings the elegance of Apple products to the clouds.

“In the process of developing an accurate assessment of who you actually are, you need to appreciate the disparity between how you appear to your own mind and how you indeed exist.”

–Dalai Lama

As I mentioned earlier, I am oversimplifying… However, every aspect of what we create (packing, documentation, web site design, technology philosophy, …) reflects on our personality and attracts customers accordingly. In reality, we don’t stop there, as businesses also attract and hire people like themselves. Which creates the cycle of similarity: similar products, similar feature sets, similar customers, similar thinking, similar mistakes, … No wonder many established firms struggle with innovation!

With that said, I believe this process, this behavior is normal. It is human nature. Given that the process of change is hard, instead we can seek to better understand the world that we operate in and design accordingly. Recently I read an article in the Building Design Strategy: Using Design to Achieve Key Business Objectives book: Design Strategies for Technology Adoption. The authors outlined six generic design strategies to drive technology adoption: endorse, curate, integrate, economize, play, refresh. Here is a synopsis of the article:

Innovation is one thing; success in the marketplace, quite another. Alonzo Canada, Pete Mortensen, and Dev Patnaik offer a framework in which design becomes the channel for uniting these two realities. Identifying five clusters of users – innovators, early adopters, early majority, late majority, and laggards – and numerous hands-on examples, this trio of authors advocates tailoring designs to the priorities of each group.

Understanding the technology adoption and diffusion process is critical for every entrepreneur. Cloud computing takes this further in the sense that, it extends beyond immediate customers to those customers’ customers for its adoption. Using a methodology like this to analyze technology adoption early on in the development process can bring balance to our natural human tendencies for developing products for ourselves. For cloud computing, thought process might go something like this:

• endorse (cater to innovators) Focused mainly on communicating the benefits and advantages of a given technology, cloud computing already passed this stage. Just check out Apps.Gov!
• curate (cater to early adopters) Focused on the early adopters, this stage is like targeted, 1:1 marketing that emphasizes key desirable benefits, functionality and return on investment for that early adopter. I would say cloud computing is at this stage, where every cloud computing vendor is marketing their differentiation to attract customers. The specific features currently includes the ease of building self-scaling applications or introducing tools and services for automatic scalability, and hybrid-cloud approach of bridging private and public clouds.
• integrate (cater to early majority) This stage is focused on attracting mainstream users, who are looking for solutions that work without compromises. What does this mean for cloud computing?! With sites like Apps.Gov, many end users who are late adopters, laggers and mainstreams will be adopting cloud computing. With that, the cloud computing technology feature set needs to satisfy both the developers and their end-customers. This includes improvement in the areas of security, privacy, governance (ability to set policies and monitor), performance and SLAs (Service Level Agreements), along with end user specific requirements, such as simplifying synchronization on and off the cloud, ease of content access across devices and platforms, reliability, trust, and of course performance.
• economize (cater to late majority) In the technology adoption curve, this stage is all about cost-reduction and commoditization. Recently Amazon launched EC2 Spot Instances, where customers can bid for the unused computing capacity and have access to resources as long as their bid exceeds the current Spot Price. Just think, global CloudExchange! To enable this level of ubiquity, we need cloud standards to drive interoperability and interconnectedness between clouds at a global level.
• play (cater to laggards) Laggars lag everyone in the adoption curve… The authors recommend making the familiar unfamiliar in order to appeal to laggards, where the motivation is not about technology. Similar to the VoIP’s entrance into the home as a bundled package with cable for voice data, cloud computing could shape into services and products that could appeal to laggards, such as TiVo-on-the-clouds.
• refresh (cater to new markets) Once cloud computing reaches its vision of computing as a basic utility delivered over the internet, what is next? How could the cloud computing vendors refresh and open up new markets? Maybe Amazon should start the Computing Affiliate Program to enable individuals to feed computing resources into the grid, just like solar into a power grid to add extra capacity.

As Drucker indicated, innovation is an effect in economy and society; it is a change in behavior of customers, in how they work and produce something (Innovation Process: 3 Things You Can Count On.) Using frameworks such as technology diffusion process and designing strategies to drive technology adoption, we can gain the needed insight and understanding to accelerate and enable the cloud as a globally ubiquitous computing utility delivered over the internet.

Technorati Tags: cloud computing, technology adoption, design strategies for technology adoption

Here is a quick backgrounder on the issue. Adobe’s Flash Video (originally developed by Macromedia) is a container format that is used for delivering video over the Internet. Many popular sites use this format to embed video and other content on the Web, such as YouTube, Hulu, Facebook, and Flash-based online games. Through Adobe Flash Player and browser plug-ins, Flash-Video is made available to users. Putting it mildly, Apple has no plans to support Flash on its iPod/iPhone family of products, while Adobe continues to push for its adoption. Instead, Apple has been pushing the HTML5 standard with H.264. For those that are interested, check out the Daring Fireball‘s summary on the topic: Apple, Adobe, and Flash.

There are numerous examples of competing technologies: VHS vs. Betamax, Blu-Ray vs. HD DVD, GSM vs. CDMA, .Net vs. J2EE, various flavors of Unix and wireless standards, open vs. DRM, MP3 vs. AAC, AC vs. DC (no, not the music group but Tesla vs. Edison)… In many cases, competing technologies encourage innovation, arguably, sometimes at the cost of building a rich ecosystem. At the same time it is not uncommon for users to experience confusion over compatibility and interoperability, such as in the case with having too many multi-media formats and having to choose a player to match the video format. However, as a technology becomes more attractive, it will see a higher adoption rate, and increasing compatibility and interoperability with others as its ecosystem becomes richer.

This is all good, but as a technology company where do you put your money? As our computing infrastructure becomes more complex and interconnected, your customers are now looking for a total system experience: high-level of system performance and interoperability with others. With this, you need to not only control your technology but also influence and direct related technology decisions with your partners and competitors. To do this, you need to evaluate your technology strategy and decisions within the context of the purpose of your business, technology attractiveness and your ecosystem. 

The purpose of your business

“There is only one valid definition of business purpose: to create a customer.”

– Peter F. Drucker; The Essential Drucker

With this, Drucker continues and states that, “Because its purpose is to create a customer, the business enterprise has two — and only these two — basic functions: marketing and innovation.” Lets apply that thought process to Apple. In a previous article, I highlighted that …By owning hardware, software, online services and everything in between, Jobs successfully controls the end-to-end customer experience, and thereby delivers on his core value: products that work seamlessly together and seldom break down.

Given this clear focus, Apple’s position on Flash-Video (remember, Apple does not use Flash-Video in any content delivered from iTunes store) and its tight control over the App Store is not a surprise (preventing developers from impeding or disturbing Apple’s ecosystem), especially with the iTunes Music Store universe it has created for its customers. Contrast this to Western Digital with a purpose to help you collect, manage and use digital information. This drives their product design decisions, such in the case with their Western Digital WD TV Live Network-ready HD Media Player which supports the widest variety of formats possible. Having purchased both toys (AppleTV & WDTV), I enjoy the freedom and flexibility I get from WDTV with its open architecture, vs. the restriction placed by AppleTV. With that said, I appreciate the ecosystem of the iPhone and its apps, and how well it plays with my MacBook versus my previous Motorola Pebl.

The government can also influence which standards and technologies you need to provide. It is common for governments to take leadership in technology development and standard setting, such as with the Chinese government’s initiative of the AVS (Audio Video Standard) compression codec, a competitor to H.264/AVC. If the standard becomes commercially successful, it would not only put Chinese electronic companies on the map, but would also reduce their licensing/royalty payments significantly. Standards, regulations and policies enable governments to:

• regulate goods for the safety of their consumers;
• encourage prosperity of local economy (by licensing domestic standards vs. paying for foreign standards);
• push for compatibility and interoperability (domestic electricity and plug standards) which benefits consumers and producers;
• sponsor development of emerging technologies (such as green-tech).

In summary, your technology strategies, along with your core competencies, need to be aligned to support your business purpose. Perhaps Facebook’s recent announcement on their HipHop for PHP technology development is a good example of focusing on core competencies (in this case PHP development) and building/leading technologies to lead with that strength (transform PHP code to optimized C++ for better performance and scalability.) Through this alignment, you can evaluate relevant technologies and start outlining your strategic position for each: lead/follow, in-house development/outsource/acquire, invest/divest/migrate, …

Technology attractiveness

Understanding and evaluating along these different dimensions and factors would help determine not only the attractiveness of a given technology, but also the factors and trends to watch for as technology implementation progresses. Scenario analysis and what if? brainstorming will help determine trends and identify critical potential inflection points to watch for. Take H.264/AVC digital video coding standard’s license and Mozilla’s stance on embedding the technology. Recently MPEG LA extended its license term where it will not charge royalties for Internet Video that is free to end users till December 31, 2015. What would that mean for competing technologies like Ogg Theora?

History repeats itself, and it could provide guidance on trends that will influence the technology adoption. It is always easier to identify inflection points once the technology war is over. The Adult Entertainment Industry (AEI) was identified as the decision maker in the war between VHS and Betamax. With Sony’s refusal to work with the AEI, Betamax ultimately lost out. As a result, all eyes were on the AEI when next-gen hi-def competition started (Blu-Ray vs. HD DVD.)

Richness of the ecosystem

In simplistic terms, ecosystem encapsulates the concept of a community of things and the environment in which they live. In the world of technology and business, this community includes organizations and individuals such as producers, suppliers, competitors, and other stakeholders contributing goods, knowledge, and other deliverables. Here is an announcement from Microsoft that captures their focus on the IPTV ecosystem from 2007.

The richness of the ecosystem certainly adds to its attractiveness. Again, take the competition between Blu-Ray and HD DVD as an example. When AEI selected HD DVD for their format (mainly driven by production costs), many assumed the format wars were over. At least until the Sony Play Station came out with a Blu-Ray drive, and the owners started to request Blu-Ray DVDs from the AEI. This newly expanded market, coupled with the fact that support from more movie studios reduced Blu-Ray DVD production costs, resulted in the AEI’s move to Blu-Ray.

Richness of the ecosystem can certainly influence/change your technology directions as well. These changes can be driven by your competitors, as in the case with Amazon.com introducing DRM-free music downloads, which resulted in increased customer desire, driving Apple to also provide DRM-free music on iTunes store. The richness of an ecosystem also influences new product concepts, such as Apple building on the strength of iPod and launching iPhone/iTouch family of products.

Thoughts on reducing your development risk…

As I mentioned before, there is no silver bullet when it comes to knowing which technology(s) to invest in. However, you can be smart on how you develop your products/technologies. These include, but not limited to:

• Adapt agile development practices, so you can rapidly shift as your products, markets and customers change. Utilize technology roadmaps as a guidance, and manage migrations as things change.
• Get your customers involved through controlled beta testing, such as with the YouTube HTML5 Video Player.
• Spend time understanding your product requirements and your technology dependencies, and establish a loosely coupled system architecture to reduce dependency.
• Leverage external relationships to reduce development effort and share risks.
• Don’t depend on the if I build it, they will come philosophy of just building the technology. Rather, help its ecosystem flourish with complementary technologies and products.
• Continuously look for ways to build economies of scale and improve your learning curve.
• Be smart about the cost of technology (direct, indirect and hidden). But also take this a step further and analyze the cost to your customers (Sony’s Playstation 3 consumes significantly more electricity than its competitors.)
• As important as standards are, your customers’ performance and functionality requirements come first. So focus on your customers’ needs while designing systems that are compatible and interoperate with standards.

Technorati Tags: technology strategy, technology competition

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