Ways of Working in the #NetworkedSociety - Strategy Experiments @ericsson 3G

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@erik_schon @ericsson | #LKCE15 | © Ericsson AB 2015 | November 16, 2015 | Page 1

Strategy Experiments @Ericsson 3G

@erik_schon Lean Kanban Central Europe, November 16, 2015, #LKCE15

Ways of Working in the #NetworkedSociety:

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Our Strategy journey 2010-2015

Strategy

specialist

Strategy feedback

loop takes years

Execution

specialists

Starting point

Continuous execution,

feedback & fine tuning

@erik_schon @ericsson | #LKCE15 | © Ericsson AB 2015 | November 16, 2015

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CAPITALS

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Erik Schön

@erik_schon

Co-creator of conditions where

people, teams and organizations

grow @ericsson

SERVING ~200 people in cross-functional teams

in Product Development Group Radio Base Stations

Product Development Unit 2G, 3G & Multi-Standard

Development Unit Radio

Business Unit Radio

Ericsson in Stockholm, Sweden

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Ericsson 3G: Facts & Figures

>40% Of all 3G traffic in Ericsson networks

10 R&D sites

1 800 people

#1 Mobile 3G networks

100 Teams

265 networks

Our Vision: a #NetworkedSociety where every person and

every industry is empowered to reach their full potential @erik_schon @ericsson | #LKCE15 | © Ericsson AB 2015 | November 16, 2015

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CAPITALS

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Why Strategy?

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Why Strategy?

Company: handle limitations - time, equipment, competence, people …

Employees: know & influence direction in order to act & decide with speed

Customers: customer delight, serving the customers’ real needs

Market: success in volatile, uncertain, complex, ambiguous environment

Competitors: sustainable competitive advantage for Ericsson

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CAPITALS

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What is Strategy?

Discuss in pairs for 2 minutes!

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“Strategy is a mental tapestry of changing intentions

for harmonizing and focusing our efforts as a basis for realizing some aim or purpose

in an unfolding and

often unforeseen world

of many bewildering events

and many contending interests.“

John Boyd

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CAPITALS

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How do you do Strategy?

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”In real life, strategy is actually very straightforward.

You pick a general direction

and you implement like hell.”

Jack Welsh

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“… by what method?”

W. Edwards Deming

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“The strategy is top secret,

you just do what I tell you.”

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CAPITALS

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Experiment 2010: Structured process

KEY LEARNINGS: Process helpful;

too much focus on implementation; forgot people, culture & experiments

Learn: situation analysis

Focus: strategic vision & choices

Align: people, culture, structure & process, measures & rewards

Execute: implement & experiment

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Experiment 2010: Wanted Position 2015

Empower people

Reduce lead-time to be more responsive

Increase efficiency to enable more output

Build quality into our ways of working

KEY LEARNINGS: Stable, balanced wanted position gives focus & clarity;

easy to show progress by quantified wanted position

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Insight 2011: Alignment + autonomy→results

Intent

What & Why

Actions

How Autonomy

Alignment

Thoughtful, purposive action

in the right direction

by all people in the organization

to reach the desired results

KEY LEARNING: Strong alignment around intent

enables maximum autonomy to take action on all levels @erik_schon @ericsson | #LKCE15 | © Ericsson AB 2015 | November 16, 2015

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CAPITALS

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Insight 2011: Long lead-time insights→actions Strategy

Update Preliminary

Balanced

Scorecard

Balanced

Scorecard

March-May

New Key Performance Indicators (KPIs) every year

September Q3/Q4

Targets still valid?

Focus on reporting & corrective actions

KEY LEARNINGS: Rapidly changing world

means quickly outdated targets

January

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CAPITALS

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Experiment 2012: regular Strategy retrospectives

KEY LEARNINGS: Positive reinforcement of wanted position;

strategy evolves & focus area changes

Continuous

Improvements

Long-Term Key Performance Indicators (KPIs)

Continuous

Improvements

Execution

Focus Area Focus Area

Strategy

Retrospective Strategy

Retrospective Business situation

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CAPITALS

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Experiment 2012: bottom-up Quarterly focus area Radically improve the test flow - how can I and my team contribute?

KEY LEARNINGS: High engagement; 144 experiments;

hard for teams to know what to do and when “done” @erik_schon @ericsson | #LKCE15 | © Ericsson AB 2015 | November 16, 2015

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CAPITALS

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Experiment 2013: Involving “top-down” challenge Every sprint delivered to a live network

KEY LEARNINGS: More clear expectations - helped by indicators,

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CAPITALS

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experiment 2014: Enabling structure for challenge

KEY LEARNINGS: Alignment for autonomy

needs enabling structure for larger improvements in large organization

CHALLENGE

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Experiment 2013: Outside in process, make choices Winning proposition

Where to play

How to win

Key capabilities

Enabling structures

KEY LEARNINGS: Useful metaphor on all levels -

from business to individuals via programs and teams @erik_schon @ericsson | #LKCE15 | © Ericsson AB 2015 | November 16, 2015

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What We have achieved 2010-2015

75% Employee motivation: 67% → 72%

Faults at customers: 250 → 40 per month

Feature lead-time: 100 → 36 weeks

Value throughput: ~4

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CAPITALS

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Inspiration

@FuentesDeOnoro

@RogerLMartin

@flowchainsensei

@plantin66

@hakanforss

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CAPITALS

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Ways of Working in the #NetworkedSociety - Strategy Experiments @ericsson 3G

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