The Last Target Operating Model You’ll Ever Need™

I first wrote this as a comment on Joel Bailey’s excellent blog post titled ‘This thing called agile might kill us all’ but thought it worth re-hashing and expanding here.

For context, Joel writes about “working for a big high street bank. The brief is to redesign the ‘end to end mortgage experience’. The timescale is to reach a business case, with a roadmap of delivery waves to achieve minimum viable product, within 6 weeks. ”

He floats the idea of a Target Customer Experience as counterpoint to that change management staple, the Target Operating Model.

I’ve had recent experience with a “TOM”, attempting to intercept with an agile, digital project. It left me puzzled, and I’m grateful to Joel’s post for helping me clarify my unease.

In case you haven’t come across one before, the TOM is a Thing in the world of “change management,” defined on Wikipedia as:

a description of the desired state of the operations of a business. Typically a TOM also includes the roadmap over time that specifies what the company needs to do to move from the “as is” to the “to be”.

For the service designers among you, a typical TOM covers similar turf to Alex Osterwalder’s Business Model Canvas, only with fewer sticky notes and more spreadsheets.

As an aside on his nascent agile project, Joel writes about the toll it takes on participants:

someone needs to write a Marxist evaluation of agile. Yes the outcome is better and it’s all very sexy and new and ‘oh so right’, but I suspect the cost on the worker is high as essentially it speeds production and works the asset of production (you and me) harder.

… which immediately set me thinking that if people are using “agile” to mean doing the same process only faster, even at the risk of burning out their people, then they’re Doing It Wrong.

I reached for the 8th of the Agile Manifesto Principles:

Agile processes promote sustainable development. The sponsors, developers, and users should be able to maintain a constant pace indefinitely.

And that’s when I realised the real challenge to peddlers of TOMs and the like: agile transformation isn’t a one-off thing that you do to get from A to B – it’s a continuous culture of iterative improvement.

Agile organisations succeed through sensing, not planning.

  • They are in touch with their actual customer experience (not just some brand fantasy). This is the dirty secret of much Target Operating Model work. A warts-and-all “as is” picture is far more valuable than any amount of “to be” prognostication – but even if that’s what executives secretly wish for, no consultant can afford to say out loud “I’ll tell you the time if you show me your watch”. Sadly the picture TOM processes do generate is often missing empathy, the key ingredient that spurs the organisation’s people on to make things better for their customers.
  • They truly understand their operating model (clue: it won’t look like a flow chart). Organisations are nothing more than systems made of, and by, people. They’re complex social constructs that operate on emotional as well as financial planes. This is what agile understands when it says “individuals and interactions over processes and tools”. To map an organisation by decomposition is to follow in the footsteps of the early Cartesians, dissecting a dog to prove it has no soul.
  • They have the capacity to make very frequent adaptations in response to their ever-growing understanding of customer needs. Being able to respond quickly to what you learn beats any amount of predicting and planning. Embracing diversity means pushing decision-making to the frontline. This in turn reduces the waste inherent in standardised processes. Let’s cultivate this as a core competency of every organisation. If we never get stuck in a rut, we’ll never require a “change programme” to jolt us out again – and that should come as a relief to all concerned.

All of this poses problems to an organisation addicted to discontinuous change. We’ll have to break down the Berlin Wall between the bits of an organisation that create “strategy” and the bits that do “operations”. Likely, product development can no longer be capitalised, so the balance sheet might appear worse before it gets better.

But I’ve come to the conclusion that this is the only sane way to run an organisation.

Learning by doing: it’s the Last Target Operating Model You’ll Ever Need™

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It can be these, but…

Our economy will not grow bigger in scale, but we will see it become more specific, more diverse, more adapted to individual needs and desires. The economy that served us well is giving way to what I call the informative economy.

According to my dictionary, “to inform” means to “imbue or inspire with some specific quality or value.” Practically speaking, information is not merely data, telecommunications, or a computer network. It can be these, but it is also the knowledge added to resources to make them valuable. It is design, craft, utility and durability — everything that makes a product more useful, longer lasting, easier to repair, lighter, stronger, and less energy-consuming. Information is nothing more (or less) than how to make or accomplish something the best way.

A Chevrolet requires ten to twelve times more expense on warranty repairs than an American-built Honda does. The difference is information in the form of design, workmanship and quality. Twenty-five years ago Honda was a “small” business. It became a big business not by building bigger cars, or cars with more gadgets, but by building a car with more information…

— Paul Hawken‘Growing a business’ (1987)

Thanks to Andy Bell for the recommendation.

Thinking about a service model: associate, participate and iterate

I recently had the privilege to front a pitch for a combined piece of service design and web development work that has helped sharpen my thinking about the way this stuff can be structured to make a difference.

The prospective client was a small, local, public sector organisation with a limited budget. We offered them a radical approach inspired by the new Government Digital Strategy. It was user-centred, agile and based on open source software. We aimed to deliver a radically simpler website than the one they have now, but one much closer to the needs of their users, and phenomenally better value for money.

ever deeper insights into user needs

To save the suspense, we didn’t get the business. I’m writing this because the reasons for the loss were instructive. We’ll learn from them and do some things differently next time. They also reinforce my belief that this approach will win out in the not-so-very-much-longer term.

Here are some things I heard from the potential client. I present them because they’re all legitimate responses, questions that stress-test the model I’m trying to build.

We proposed an associates model, a dream team of specialists wrapped around the client’s needs. I regarded that weightless flexibility as a strength, but in the client’s eyes it presented a risk: “Your company, there’s nothing to it,” said one of their panel. “How do we know you’ll still be here in 12 months’ time?”

We proposed a highly participative design process including user engagement through social media and a co-creation workshop with customers to conceive the first version of the website. The client felt this was abdicating our responsibility as designers. “Isn’t this just design by committee?” he asked.

We proposed an iterative process in which we research a little, start engaging through a minimum viable service and build up our knowledge of, and utility to, service users through insight and action hand-in-hand. Another of the client’s panel was a market research expert. How, she asked, can you be sure to represent users accurately with only a small slice of research upfront?

At the time, I felt I gave good answers to each of these objections. Only afterwards, with the wit of the staircase, did I come to understand that the three elements of our model – associate, participate, iterate – hang together as a single dominant strategy for solving the problems that organisations face today.

Teams that get good at delivering this, and clients who get good at tapping into it, can focus the most talented people on the most fruitful opportunities, and do so consistently, not just in the rosy afterglow of signing a new agency.

The power is in the way the elements interact.

participate + associate + iterate

Associates + iteration takes the risk and the compromise out of picking a team. By being well-connected and aware of our strengths and weaknesses, micro businesses can bring to bear expertise far beyond that offered by bigger entities with fixed salary bills to service. But more than that, the associates model can flex over the course of an engagement, bringing in the right skills for as long or as short a time as is needed. To the question “will you still be around in 12 months?” the best answer may be “only if we’re still the right people for the job.”

Associates + participation challenges the line between designers and users, service providers and recipients of service. If the project team itself is fluid, it can flow seamlessly into an expert group of users, users who are experts in their own needs, abilities and requirements. Contextual inquiry places the design researcher in the position of the “apprentice” learning from the user, or “master,” how they do what they do. By serving this apprenticeship, the researcher qualifies to add his or her own creative solutions to those already developed by the user. By engaging with service users and those who serve them we don’t abdicate responsibility to design, we earn it.

Participation + iteration means there is always the opportunity to learn more from users and their experience of the service. Knowing that learning never stops is liberating because it lowers the barrier to making a mark, getting the minimum viable service out there and into users’ hands. Will the first version be limited? Yes, of course. Will we be wrong about user needs? Almost certainly. But we’ll soon discover how limited, and how we’re wrong, and move quickly to improve in the next iteration. We’ll discover unmet user needs, and, if we remain open, maybe whole new groups of users too. With making and testing so easy, Big Research Up Front is no longer a risk we have to run.

Delivering this model is not without its pitfalls.

The associates model only works if each client sees the value in having a top notch team, and recognises the team assembled as a mirror to their unique set of needs. Practically, suppliers and customers alike must lower transaction costs that have made it prohibitively expensive for individuals and small team practices to play in vast swathes of business territory. But this is what the internet is made for. The comparative advantage of large organisations shrivels with every slick, cloud-based productivity tool that is launched.

When you’ve experienced true user participation, its advantages are obvious, but it also seems like a risky proposition from the outside. The trick is in the way target users are identified, engaged and brought on board as equal voices to insiders and vested interests. The process can look chaotic before the insights emerge, and making the time and place for this to happen takes rare skills and a leap of faith.

And iteration, though so obviously good sense to us when we are children, is a habit that big business beats out of grown-ups through interminable roadmaps, waterfall processes and excessive penalties for failure. People need space to learn and make mistakes in a low-risk, yet visible way. They need simple dashboards to measure and monitor progress. They need to know when to cut their losses on an experiment and when to throw everything at a model that’s starting to work.

But if I had that pitch again, this is what I’d say: Accept no imitations. Associate, participate and iterate to win.

If you or your organisation want to work like that, then please do say hello.

Murray versus Watt at Bettakultcha

My 20 slides from Bettakultcha at Temple Works, Holbeck…

… on which more later, but meanwhile you can also read the original blogpost: How to get ahead in business the Boulton and Watt way.

How to get ahead in business the Boulton and Watt way

Dirty tricks among high-tech businesses? I recently came across the original Machiavellian play book for start-ups, and it’s more than 200 years old.

Two of my 1794 heroes were the steam pioneer James Watt and Holbeck engineer Matthew Murray. Both made engines for the textile mills of northern England – in effect the processing power to transform raw wool, flax and cotton into finished cloth. Later, their inventions went mobile to haul the first railway trains.

But the villain of this piece is Watt’s son, also called James, who in 1794 joined his father’s partnership with Matthew Boulton. Within a few years the upstart Leeds foundry of Fenton, Murray and Wood proved a serious competitor to Boulton & Watt’s more famous Soho works in Birmingham.

Matthew locks away the planing machine

The stories of Watt’s feud with Murray are the stuff of Leeds legend, but to understand just how blatant it was you have to revisit the original sources, the letters and newspaper advertisements of the protagonists themselves.

Here, in his own words and those of his contemporaries, we can piece together the business wisdom of James Watt Junior.

Continue reading How to get ahead in business the Boulton and Watt way

All this rubbish Powerpoint must be telling us something

Chris Heathcote’s abstract pointillist Powerpoint toolkit once again reinforces the received wisdom that Microsoft’s near-ubiquitous presentation software presages the end of civilisation.

Unlike the army of total Powerpoint rejecters, Chris’ solution is to fight pixel with pixel, subject to three strictures:

POINT ONE: Presentations are about IDEAS, not TEXT.

POINT TWO: READING from SLIDES is a heinous crime.

POINT THREE: PEOPLE cannot COPE without some kind of visual STIMULATION.

I love the abstract toolkit and hope one day to try this parlour-game in a work context (but not, I promise, at the forthcoming Mobile Internet Portal Strategies conference for which I’m preparing this week.)

However, it set me wondering: if Powerpoint sucks so badly, how come so many people use it? And how come they use it the way they do – densely textual, reading from slides, as a substitute for eye-contact between presenter and audience? It’s not like Steve Ballmer has issued a decree forcing people to do it this way – in fact it’s the reverse: our sucky cut-and-paste Powerpoint culture is the ultimate product of co-creation.

So rather (or at least as well as) decrying rubbish slideware, how about we spend some time trying to understand the deep needs that drive people to it in the first place, and how they might be met better some other way. I don’t have all the answers, but here at least are a few of the forces at work:

  1. You need cue cards – but the 80GSM A4 stock in printers doesn’t cut it. In the old days speakers had palm-sized index cards with hand-written notes, but (a) you won’t find them in the office stationary cupboard any more (I know, I checked), and (b) have you tried to read my hand-writing? I went to school in the Seventies, you know. Result: the cue cards are no longer in the speaker’s hand, they’re up for everyone to see on the big screen.
  2. Your audience speaks a different language – when presenting to people who don’t share the same first language, sending the slides round beforehand isn’t just an administrative nicety, it’s a necessity so that they can make sense of proceedings at their own pace. Powerpoint is to business what subtitles are to art-house cinema.
  3. Your audience is only paying partial attention – gone are the days when the whole family would gather round to listen to a Malcolm Muggeridge lecture on the wireless. These days you’re lucky if anyone peeks up from their laptops and Blackberrys long enough to read a few bullet points, let alone actually listen to a complete sentence, with sub-clauses and everything.
  4. Your audience is somewhere else entirely – and in this respect i’n’t the internet brilliant! Chris Heathcote’s modern-day ink-blot test has had almost 4000 views on Slideshare in just four days, so my bet is that more often than not, the presentation document does have to speak for itself. Who then could resist the temptation to reiterate in the slide text every major point they plan to make in person?

In new product development, we often look for “workarounds” – the sub-optimal things that people do as a way of achieving their goals, then we think about how we might help them achieve these goals more elegantly, with less effort. Where are the innovations that meet the subtle communications needs of the Powerpoint-challenged? They must be out there somewhere, but they probably don’t look like presentation software at all.