Compare and contrast the two stories :

1. I needed a new debit card for my UK bank account. I called the customer service number for this relatively simple request, only to be told that I did not meet “the criteria” for getting a new card over the phone. Bear in mind that I have always ordered my cards this way before and have been with the bank for about ten years. They would not tell me which criteria I did not meet. I’m not the most patient person when it comes to poor service like this, so I had to go through four layers of call centre management before someone had the initiative to solve the problem. Total length of my call : 45 minutes.
2. I needed to transfer some money from a UK account to a NZ account. After some research I decided to use a service called Tranzfers which offers much better rates than commercial banks and with cheaper fees. I registered with them at about 11pm (New Zealand time). Barely five minutes had passed before my phone rang. It was a Tranzfers customer service rep asking if I had any questions about the service.

In the first example I was so totally annoyed with the whole process that if someone had given me the option to change banks on the spot, I would have done so without hesitation.

In the second example, I’m sure as hell going to use Tranzfers. If this is the service it provides when I sign up, then I’m pretty sure I won’t be kept on hold for 45 minutes for a simple query.

Why is this relevant?

Innovation can sometimes be time consuming and expensive. When it comes to service innovation, it can be doubly so. However a business can make a huge impression on a customer not through massive innovation programmes, but by simply treating people right from the outset.

The moral of the story : Get the basics right before embarking on innovation journeys.

The latest issue of the McKinsey Quarterly has an article which discusses how to get an understanding of your customers in order to develop new markets and better understand existing ones.

It makes a few good points, and the sentiment is certainly correct. It’s a new world out there, and building markets based on assumptions, hunches and bad data won’t get a company very far.

However I take issue with the section on product development. As with much that is written about this area, it talks in general about observing customers being one avenue leading to new product design. Although it is clearly outside the scope of the article to go into details, ethnography, even when undertaken by experts, can give hazy guidance at the best of times.

The article states :

“A cell phone manufacturer looking for promising offerings in several profitable markets, for example, established customer segment panels, whose members were asked to maintain diaries detailing where and how they used PDAs and wireless devices. With this information in hand, the company’s brand and segment managers could ensure, at key stage-gate points in product development, that the teams of developers were truly meeting the needs of target customer segments in critical markets by proposing appropriate new-product and packaged-service ideas, such as business- or entertainment-oriented browser interface designs.”

I’d love to know how McKinsey proposes that these insights are ranked and quantified in order to provide some sort of priority for the design process. Also, exactly how did the brand and segment manager ‘ensure’ they met the needs of customers. Oh, and how much the customer panel process cost.

As a sideline, here’s my customer insight about McKinsey : It’s ironic that an organisation which preaches about customer insights and open innovation does not have a facility on it’s own site for people to leave comments or trackbacks. The tag-line for the Quarterly is “Required reading for the business elite.” Wake up guys.

From This Blog Sits at the is this great post about Disney’s approach to risk taking, and Johnny Depps response.

[T]he eccentricity of Depp’s approach sent ripples of panic through Disney’s executive suites. Frantic phone calls were placed to Verbinski, Bruckheimer, and Depp’s agent: Why is he walking funny? Why is he talking like that? Is he gay? Is he drunk?

And it wasn’t only the suits who were concerned: ”The first scene I did with Johnny, I was like, What the fuck are you doing?” Knightley says. ”None of us knew if it was going to work.”

Depp was not to be deterred. ”It was just fuel to go further,” he says. ”Not because I wanted to piss Disney off, but because I believed it was the right thing to do. Finally, I said, ‘Look, you hired me to do the gig. If you can’t trust me, you can fire me. But I can’t change it.’ It was a hard thing to say, but fuck it.” (Rottenburg)

Sticking to the safe ground only produces more blandness.

It’s the edgy, different and risky stuff which makes life interesting.

They do things like this…

How to make Samsung more innovative? One key initiative is the VIP Center.

The center, at Suwon, Samsung’s main manufacturing site, 20 miles from Seoul, is open 24 hours a day. Housed in a five-story former dormitory, it has 20 project rooms, 38 bedrooms for those who need to spend the night, a kitchen, a gym, traditional baths, and Ping-Pong and pool tables. Last year some 2,000 employees cycled through.

The VIP Center specialist guide teams in discussions exploring ideas and concepts from entirely different industries.

Read the full article here.

Where do most of the ideas come inside your company?

Not from management.

Not from consultants.

Not from trend-aping breathless management books.

But from inside your organisation.

Read more at Optimize Magazine (via Imaginatik Research)

After sitting in a two day corporate workshop, I took time out to read gapingvoid. The latest post has a cartoon with the caption : “Working for a corporation means having to worry about getting fired on a daily basis.”

It started me thinking about why almost every workshop is the same format, almost every conference is in a bland boring venue and why so many people sigh when they discover they have been selected to attend an offsite.

It’s because they are designed/planned to be safe. Nobody gets their nose out of joint, everyone knows what to expect. and nobody gets fired for breaking the paradigm. How do you design an event that’s not safe? An event that people not only remember, but value? An event when nobody falls asleep after lunch?

You can start by reading this list of nine things that are wrong with the conference/workshop/off-site format :

1. Passive events = passive thinking : an event composed of talking heads on stage provides little chance for interaction and leads to people tuning out.

2. Never give handouts before a presentation. People read them ahead of you, and then switch off.

3. There’s hardly any divergent thinking to engage and challenge people. If you get more of the same speakers from within your organisation then you will get more of the same outcomes.

4. Agendas – a known format allows people to tune out when they feel like it. If they don’t know what’s coming, they don’t know when they can go and check email and answer messages. Take people out of their comfort zone and refuse to give them an agenda.

5. Powerpoint. It’s a tool for showing images, not a word processor. Do yourself a favour and give all presenters a copy of Seth Godins “Really Bad Powerpoint” well before the event.

6. Conference rooms. Beige walls, flourescent lighting, lecture-on-a-stage and inflexible furniture. It’s all stuff people have seen many times before, and makes them comforted. Comfortable people aren’t going to start revolutions.

7. The belief that adding excessive decoration to a bland conference room adds value to the outcome of an event.

8. A seating plan that lets people stay in the same seat at the same desk for the entire event.

9. No follow up from management. On the off chance that you come away from the event with enough energy to burn a block of asbestos, the walls that you encounter on the return to the office will soon stifle your enthusiasm. What’s needed is a structured program of follow-ups and refreshers.

What’s your 10th item?

Although this post is not directly related to innovation, it relates to the stifling of innovation, and how not to treat your customers.

Background : In New Zealand Telecom is the dominant ex-govt telco. Even though it is now privatised, it has fought tooth and claw to prevent regulation which would force it to unbundle the local loop, thereby allowing ISPs to compete on an even field for broadband offerings.

In March the CEO of Telecom was recorded at an analyst briefing saying that telcos created confusion via their marketing plans in order to prevent customers making direct comparisons on pricing plans. That it itself was an interesting admission for a telco CEO, and one that Virgin Mobile in the UK made the most of when it stormed the market with simple pricing plans.

That audio clip made it’s way into a video mashup, which mixed the CEOs comments with clips of Telecoms own advertising. Needless to say, the message was less than complimentary. The clip went viral very quickly with over 35,000 views on YouTube and Google video before Telecoms lawyers went to work. By the way, following this link under the ‘2006’ section on Wikipedia will point you to the new clip location.

So what’s interesting about this?
1. Telecom basically admitted that it actively creates customer confusion in the market. There’s an opportunity here for an innovative company which talks to customer in plain English.
2. Customers are so annoyed at Telecom, that they take that message and repackage it before sending it out to a receptive audience. They don’t bother to use the old channels, but make use of new web tools to get their message across.
3. The message is very well received by other annoyed customers, and even makes it onto national television news.
4. Telecom, obviously not quite learning that the rules have changed, send it’s lawyers after the clip.

When will a company like this – and those like it – realise that the ground beneath their feet it moving. And despite what they might try and tell you, it’s very hard to fight an earthquake with lawyers.

In this fascinating podcast Tom Kelly talks about the 10 Faces of Innovation as he has observed at Ideo.

The most interesting part of the conversation is almost near the start, when he starts talking about ‘unfocus groups’. In this process Ideo recruits the opinions of those on the fringes, the extremists and the rabid fans. Tom makes the point that most companies run focus groups that look at the normal consumer which fits in the centre of the bell curve.

However in unfocus groups, the people on the edges bring their wacky ideas and passions to the fore, thus acting as a catalyst for new directions of thought.

“If you’re looking for new ideas that don’t yet exist, don’t talk to normal people because they’re just consuming what is available today – find the weirdos and see what they’re doing, what they’re making on their own and say gee – is there something I can mainstream from this?”