Exploring the unknown while doubling the growth rate. A transformation story
The CEO of our client, a security service provider, had driven an extensive strategy project. With a new vision and corporate strategy established, the client had come to the conclusion that the winners in their market would be the actors that would succeed with digitalization and exponential technology like machine learning and automation. The strategic insight was there, but how to actually make it happen was still in question.
The first initiative to drive digitalization and exponential technology for the client was to heavily invest in the identified technologies. These first attempts at investment were not successful. The client was not only unsuccessful with the investments but also unable to invest at the desired rate, falling short of their 100MSEK yearly investment target. There were a number of issues holding them back
All really new initiatives were halted by the Project Review Board
Internal resources were scarce and busy elsewhere
New initiatives had to fight for resources with business-as-usual projects (that got prioritized since they were deemed less risky, with a higher ROI)
It was clear that an initiative was needed to break the status quo and get the organization on to a track where investing in the identified strategic path was possible.
The solution to the logjam was to establish an exploration phase for uncertain initiatives. An exploration phase is established to focus on learning and removing uncertainty. With an exploration process in place, the uncertainty that caused the Project Review Board to halt projects was explored and removed. With an exploration phase in place, there was now a much smaller risk of the safe option being chosen. With a much better understanding of risk and reward, uncertain projects could now be run through the regular project execution phase and a much better flow could be established.
To establish the exploration phase process, two initiatives per quarter were explored. Different types of execution setups for the organization were tested to understand what would work well in the client’s situation, given the culture and intentions. After a few iterations, Design Sprints proved to be the most effective way of working. As seen from a learning-per-time-and-money-spent standpoint.
With the process successfully established, the client gained a way to explore uncertain strategic initiatives and projects before investing any major internal resources. The staffing of the different sprints depends on the nature of the initiative to be explored. Initiatives close to the current core business often require internal resources to be successfully tested with Design Sprints. More radical initiatives typically need less domain knowledge and Design Sprints can be carried out with mostly external talent.
The Design Sprint setup helped our client explore up to eight new strategic initiatives per year. They doubled their growth rate while staying profitable all three years that the engagement lasted.
Examples of ideas and initiatives that were successfully tested using the Design Sprint method were
Service automation
IoT generator data
Hackathon outcomes
Details around Design Sprints
A Design Sprint is a 4-day super compact process designed to solve difficult problems. You start with a prioritized initiative or project on Monday morning and by Thursday afternoon you have a prototype tested on 5 end users.
For our client the data collected from those end users would most often give enough data to show wether:
this was a good idea that was ready to be set up as a proper project
more data was needed to validate the idea
it was time to give feedback to the Management Team that the explored initiative/idea/project did not show any real potential for the organization
The Design Sprint was developed at Google Ventures, and made famous by the book Sprint: How to Solve Big Problems and Test New Ideas in Just Five Days written by Jake Knapp in 2016. Rhubarbs use a four-day version called Design Sprint 2.0 developed by Berlin-based design firm AJ & Smart in 2018. The process has had a small upgrade to better suit exploration (the stage where you don’t even know if what you are exploring is a good idea). Our addition consists of an exercise to identify the riskiest assumption or hypothesis that underlies initiative/project/idea to make sure that we take care of the biggest issues first and make critical learnings happen as fast and cheap as possible
