Restoring the balance: customer desire vs. business impact

The Eureka moment came sometime earlier this century: that customer of ours - what if we now take them really seriously? Listening with empathy and all that. And then trying to solve a real existing problem. Mix that with iterative build-measure-learn, and you build the unmissable success in a responsible way.

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In no time, the testimonials of successful start-ups were flying at you from all directions. From Airbnb to Dropbox, from Blendle to Strava. A new way of working was born.

It was also during this time that MakerLab emerged, and we started putting these principles into practice as a firm. In fact, we have consistently been testing the above principle. Continuously exploring new markets, working with new clients on fresh projects.

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And believe me, that's much less exciting than those fascinating startup stories. It's real work in the real world, with all the (im)possibilities involved. Especially within corporates.

The challenging stakeholder

One advantage, though, is that we learned a whole lot. And it was one of the insights we gained from doing very, very, very many projects that made us decide to change course within MakerLab.

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It started with our direct clients, often an innovation lead or product owner. We work closely with them. They, and therefore we too, often had trouble with the so-called "most challenging stakeholder".

Every innovator knows them. That man or woman who always asks at an inappropriate moment, "Great idea, but how much are we going to make from this, and how does that work, then?"

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And then you have to respond, "Uhh, we've just completed the qualitative interviews about a potential solution... so, um... no idea." And after the meeting, you'd vent with your team about how these people really didn't grasp the innovation process!

Impact must be measurable

But let's be honest for a moment. Innovation within companies primarily revolves around the measurable impact on the business model. Making more money, spending less, working faster, improving knowledge sharing, collecting more relevant data, reducing churn, increasing referrals, reducing environmental impact, and gaining better insights into your supply chain. Whatever it may be.

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The prophecy also states that new propositions arise at the intersection of customer desires, technological capabilities, and the impact on the business model. If you believe that (I do), then you cannot get away with insights that revolve solely around the customer or a business model canvas with vague sticky notes.

And so, this question kept us quite engaged. For our peers at our customers, and therefore for ourselves as well, it is a crucial element in stakeholder management. It also creates support for investments.

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But more importantly, it increases the chances of successfully implementing new services, products and processes. Simply because you create certainty.

Sacred process or answer?

So we went in search of how we could tackle this problem. The initial instinct was to persuade the question posers of the sacred innovation process. "Give us the space, and it will be fine," so to speak.

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We go strictly by the book, tackling the most risky assumptions, which are primarily customer-centric, and we continue to experiment and validate until we naturally learn what the answer is.

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Soon the impossibility of this path became clear to me. The budget required is likely to be high and poorly substantiated. Plus, the success criteria are vague and cannot be tied to concrete business goals. There is too much uncertainty in this half carte blanche to make a real difference.

You may as a bureau or as an innovation employee ask for some trust from an organization. But you must be able to offer something in return. If you can't do that, your insights will, if you're lucky, end up as small unsatisfying adjustments (and you had so many plans).

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Or even worse: in an annual plan that you never hear about again. Repeat that last part twice, and you can bet your bottom dollar that the budget for the innovation process will quickly be exhausted.

Inventing the wheel

So we started looking for an alternative. That didn't seem difficult: making sure we could answer the difficult stakeholder's question. But without robbing the lean development process of its strength or uttering things that were absolute nonsense. And that's where we hit a wall.

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Because it turned out that there was a wealth of validation methodologies to investigate customer desires, but we could find very little when it came to making the real business impact measurable.

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Sure, there is the extremely useful business model canvas, and a multitude of pricing experiments or market-potential research methods can be found. But that wasn't going to satisfy the troublesome stakeholder. The latter wanted more.

Because what we were looking for was something that at every stage of the lean development process, from discovery to the scaling phase, could be able to provide the most relevant answers to business impact questions.

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About what it delivers, where the potential lies, how the business model does and doesn't work and what that means for what you all can and especially can't and shouldn't do. And so, since last May, we started inventing the wheel. So building, testing and learning.

And meanwhile, we are achieving the first successes. We developed the business impact model and successfully applied it to various proposition within the B2B services department of a large corporate.

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We worked on tooling that can stimulate the creative process in the ideation phase based on existing business models. Finally, there is an effort to develop a bit of number magic that demonstrates how to establish a connection between a desired business objective and your innovation funnel.

Moral

The moral of this piece? Take the business element just as seriously from the outset of an innovation project as we do with customer wishes. Ensure that you build insights that provide guidance on the business impact.

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Because the more specifically you can answer the question of the challenging stakeholder, the greater the chance that your product, service, or process will actually be implemented, and you can truly fulfill that customer's wish.

To be continued.

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