Better service through business design

@cathycracks

better services through business designUXIstanbul 2016

Cathy Wang @cathycracks

Problem Solution SolutionUnderstand Problem

Abductive Thinking

Business Thinking Design Thinking

The difference between business thinking and design thinking as per Tim Brown

@cathycracks

in this talk:

How to do financial modelling

How to use excel

How to apply design thinking to businesses

@cathycracks

Cathy Wang@cathycracksNomadic Vancouverite found mostly in Europe.

Business Design & Transformation. London. UK

I spend a lot of time thinking about the future, systems, and the interconnectivity of world around us.

http://twitter.com/cathycracks

Building market ready products

Digital Transformation

Startup Incubation

Founded in 2000 280+ employees in 6 cities 30%+ year-on-year growth for 15 years Best place to work in Europe 2012 & 13

@cathycracks

Always design a thing by considering it in its next larger

context —

a chair in a room, a room in a house, a house in an environment, an

environment in a city plan.Eliel Saarinen

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design thinkers treat businesses the way designers treat users

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Seeing Design Thinking in its core elements: • design thinking framework • design process • design rationale

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applying design thinking is like painting a picture…

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frame canvas brushes

credit: @folletto

Context Project Tool

The framework for design thinking…

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the design process

Understand Design Iterate

Regardless of what we are designing, we go through a similar design thinking process.

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always ask why

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Yes, delete it No, keep itNo, keep itYes, delete it

Do you really want to delete this? Do you really want to delete this?

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The spectrum of design

Management consultingVisual

designUX

designService design

Business design

If we look at the spectrum of our design competency, design thinking can be applied in all of it.

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A BUCKET FULL OF PETROL OR A MONTH OF

SOLAR POWER?Become the king of solar power in your neighbourhood.

Get a share of the solar power plant.

Read more:

Framing the problem

Helsinki Energy

Once upon a time, there was Helsingin Energia, 3rd biggest energy producer in Finland. Every year they talked about building a solar power plant, but someone always said: "No one will buy expensive electricity. We can produce cheaper juice by burning coal."

Futurice launched a test marketing campaign to engage with potential customers. It turns out, a huge amount of the existing Helsingin Energia customers would happily pay a higher price for solar power.

Because of that, Helsingin Energia realised that people don't want to buy expensive electricity. They rather invest in green power.

@cathycracks

SELECT AND ORDER YOURSELF A DESIGNATED SOLAR PANEL

FREE SOLAR PANEL (10) PUCHASED SOLAR PANEL (1184)

Prototyping a business model

Helsinki Energy

Futurice built a web page where people could buy/rent their own solar panel on the large rooftop of their solar power plant, and nothing else.

In two days the whole power plant was sold out.

"We have sold the whole solar power plant. Should we build it now?"

Because of that, the executives could say nothing except: "Yes!"

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What is a good service?

meaningful

When I think about what a good service means, I start with it being “meaningful”. But what does “meaningful” mean?

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What is a good service?

meaningful

scalable

flexible

adoptable

profitable

sustainable

desirable

learnable

approachable

useful

feasible

viable

usable

enjoyable

sensible

There are many different ways to justify “meaningful”, from different point of view.

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Startup Corporation

Thinking of business, on a scale

Startup as a very beginning / shell of a business. On the other spectrum there’s the large corporation.

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I was involved in a project to craft out the business and service for a music related startup. The client needed business design, but they were asking for design execution.

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How should we design it?


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What are the driving forces behind MVP

and roadmap?


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Why are we designing this

service?


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How is this startup going

to sustain itself?


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why are we doing this?

the client asked us to.

This is the wrong answer.

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I want to meet Bruce Springsteen.

The client also said this as a reason at some point…

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Build a business that can grow into something more.

We want to answer the question with our business hat on.

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We want enable users to capture, collect and share personal moments, reliving those memories from different events in life.

Put on our product hat and answer the question.

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the product development strategy= why are we doing this?

We needed a driving force to drive the product development. This strategy will have to balance all the needs for business, design, and technology.

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the product development strategygrowing the user base for a year before monetization is turned on

It wasn’t easy coming to this ”conclusion”, and i am going to tell you how this come to be.

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Does it help us grow the user base?

With the strategy in place. we had better answers. when planning the sprints, even the developers asked business oriented questions.

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The paralleled process product design v.s. business design

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evaluate the market / context

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Who are the competitors? What’s the market like?

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What’s the size of the market? Served market? Served market growth rate? Target market?

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how will the users behave

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Key audience 18 -25 year old

Personality descriptors include: Passionate Curious Genuine Warm Fun-loving Explorative Connected Energetic Caring

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Amount of active users Drop out rate Engagement rate

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discover the values proposition

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Following the user journey

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Revenue hypothesis Revenue streams Secondary market

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how to make it run

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What’s the best tech stack? What tools will we use?

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Expense projection Operating expenses HR

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different set of tools, same process

A lot of the business design does happen in excel in order to quantify decisions. But the application of design thinking is the same.

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the overall plan2015 2016 2017 2018 2019

Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4

Prod

uct

KPIs

Ope

ratio

nFi

nanc

ial

app launchTicket & Merch launch

Native Advertising launch

Musician subscriptionTip the musicianPRS

Direct booking with venue

The designer / normal people friendly plan

@cathycracks

the overall plan2015 2016 2017 2018 2019


Prod

uct

KPIs

Ope

ratio

nFi

nanc

ial





CMO hired CTO hired

Community manager x 2 hired

Admin hired

Developer x 2 hired

Internationalisation x 1 hired


@cathycracks

the overall plan2015 2016 2017 2018 2019


Prod

uct

KPIs

Ope

ratio

nFi

nanc

ial





CMO hired CTO hired


Admin hired

Developer x 2 hired


CAC goal: £2 ARPU goal: £2

CAC goal: £1.5 ARPU: £4




@cathycracks

the overall plan2015 2016 2017 2018 2019


Prod

uct

KPIs

Ope

ratio

nFi

nanc

ial





Total active users: 200 Total users: 5K Total users: 14K Total users: 384k

CMO hired CTO hired


Admin hired

Developer x 2 hired


CAC goal: £2 ARPU goal: £2





@cathycracks

the overall plan2015 2016 2017 2018 2019


Prod

uct

KPIs

Ope

ratio

nFi

nanc

ial

Monetization turned on

High level strategy: Growing the user base before monetisation happens.

@cathycracks

the overall plan2015 2016 2017 2018 2019


Prod

uct

KPIs

Ope

ratio

nFi

nanc

ial

Primary user

Secondary user

ProjectedrevenueStreams

revenue

scale revenue by targeting secondary users for added value

@cathycracks

the overall plan2015 2016 2017 2018 2019


Prod

uct

KPIs

Ope

ratio

nFi

nanc

ial

ARPU (Primary users)

ARPU (Secondary users)

Less secondary users but they generate more revenue per user

Primary user

Secondary user

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the overall plan2015 2016 2017 2018 2019


Primary user

Prod

uct

KPIs

Ope

ratio

nFi

nanc

ial

Secondary user

Primary user CAC

Secondary user CAC

Costs less to acquire secondary users as well

CAC. gives insight on what “users” mean to the business.

@cathycracks

the overall plan2015 2016 2017 2018 2019


Prod

uct

KPIs

Ope

ratio

nFi

nanc

ial


revenue

Headcount

team ramp up for features

Operational cost

@cathycracks

the overall plan2015 2016 2017 2018 2019


Prod

uct

KPIs

Ope

ratio

nFi

nanc

ial


revenue

Headcount

team ramp up for features

hire more operational staff & international team

Operational cost

@cathycracks

the overall plan2015 2016 2017 2018 2019


Prod

uct

KPIs

Ope

ratio

nFi

nanc

ial


revenue

headcount

cash in bank

Seed round A round

How fast are yo spending your money and how soon do you have to raise more money?

@cathycracks

the iterative balancing act

Product

Strategy

Operation

Financial

This is an iterative balancing act between all the different consideration. it would give us a MVP roadmap, a financially sustainable business, and a reasonable operation.

@cathycracks

In the end, better services

new revenues streams

more value provided for users

self sustaining

The business perspective has given us more context.

@cathycracks

Thank youUXIstanbul 2016

Cathy Wang @cathycracks

https://vimeo.com/95734218

References

Helsinki Energy

Cathy Wang@cathycracks

Wildlife Turst UK & Mental Illnesshttp://www.wildlifetrusts.org/tackling-mental-illness

http://designthinking.ideo.com/?p=49Design Thinking

http://ux.stackexchange.com/questions/49991/should-yes-delete-it-be-red-or-green/

Red or green button