Dare Sessions: Organisation 3.0

DARE SESSION THREE ORGANISATION 3.0

3rd July 2012

STRUCTURE CULTURE PROCESS

key themes PEOPLE

key themes INNOVATION

TODAY WE WILL COVER MOVE FAST, BREAK THINGS

ORGANISATION 3.0

ORGANISATION 3.0, CASE STUDIES

AGENCY 3.0

AGENCY 3.0, CASE STUDIES

Eric Edge, Facebook

Neil Perkin, Only Dead Fish

Arwa Mahdawi, Contagious


Nadya Powell, Dare

TIME FOR DISCUSSION


ORGANISATION 3.0


AGENCY 3.0


Eric Edge, Facebook




Nadya Powell, Dare

To view Eric’s slides, please go to the IPA Creative Pioneers

presentation, here:

http://www.youtube.com/watch?v=kGbzn8W8LGE

http://www.youtube.com/watch?v=kGbzn8W8LGE


ORGANISATION 3.0


AGENCY 3.0


Eric Edge, Facebook




Nadya Powell, Dare

• Organisations felt bombarded by change - many are struggling to keep up.

• 8 out of 10 CEOs saw significant change ahead, yet the gap between the expected level of change and the ability to manage it had almost tripled since the previous study

http://www-935.ibm.com/services/uk/gbs/html/ceostudy

THE ONLY CONSTANT IS CHANGE

Source: “From Stretched to Strengthened – Insights from the Global Chief Marketing Officer Study”, October 2011, IBM, CMO C-Suite Studies, 1700 CMOs

4 out of 5 CMOs anticipate a high/very

high level of complexity over the next 5 years,

but only half felt ready to handle it.

Percentage of CMOs reporting under preparedness


PAID

OWNED EARNED

ADVERTISING Paid search, display, affiliate

DIGITAL PROPERTIES Websites, blogs,

microsites, Social presence

PARTNER NETWORKS Word of mouth,

Digital PR, Influencer outreach

Paid placements Atomisation of content into ads

Atomisation of conversation through APIs and social widgets

The average half life of 1,000 popular bitly links was 3 hours

Disintermediation & disruption: A journey away from linear, one way, interruption, frequency,

inflexibility…towards what?

http://russelldavies.typepad.com/planning/2007/04/beta_tees_and_l.html

THE CHALLENGE: AGILITY, RESPONSIVENESS, PACE OF INNOVATION

NO SILOS

The need to break down organisational

silos is very real

The Eureka Myth – the myth of the lone-creative genius with a spark of sudden inspiration. Ideas take a long time to mature, sometimes laying dormant (in the form of 'partial hunches' or half-ideas) for years. It is the collision of these half-ideas that enables breakthroughs to happen. Rather than being a single thing, ideas are networks, or new configurations.

POROUS ENTERPRISE: CHANCE FAVOURS THE CONNECTED MIND

The great driver of innovation has been the historic increase in connectivity between us that creates infinite possibilities for ideas to be swapped Agile enterprises that understand this create and enable spaces (physical and virtual) where ideas can mingle (in the way that coffee houses did in The Enlightenment)

POROUS ENTERPRISE: CHANCE FAVOURS THE CONNECTED MIND

• Connected employees bring new thinking into the organisation

• Allows for innovation at the edges – non-core thinking

• Relationships seen as valuable assets

• Flow of ideas into and within organisations

• Companies less reliant on ‘stocks’ of knowledge, and more connected to ‘flows’ of knowledge

POROUS ENTERPRISE:

A new class of company is emerging—one that uses

collaborative Web 2.0 technologies intensively to connect the internal efforts of employees and to extend

the organization’s reach to customers, partners, and suppliers

THE NETWORKED ENTERPRISE

“…fully networked enterprises are not only more likely to be market leaders

or to be gaining market share but also use management practices that lead

to margins higher than those of companies using the Web in more

limited ways.”

THE AGILE MANIFESTO

http://agilemanifesto.org/

INDIVIDUALS AND INTERACTIONS

WORKING OUTPUTS

COLLABORATION

RESPONDING TO CHANGE

PROCESSES AND TOOLS

COMPREHENSIVE INPUTS

CONTRACTS AND HIERARCHY

FOLLOWING A PLAN

over

over

over

over

Concept

Detailed Design

Build

TRADITIONAL ‘WATERFALL’ APPROACH

Concept

Detailed Design

Detailed Design

Build Build

Detailed Design

Detailed Design

Build Build

SPRINT REVIEW

SPRINT REVIEW

SPRINT REVIEW

SPRINT REVIEW

AGILE PROCESSES

• Improved speed of decision-making, more in-tune with agile tech teams

• Concept of ‘being in beta’, using data to adopt a more prototypical approach

• Involve feedback from customers early in the process to mitigate risk

• Work in more flexible ways with digital talent e.g. talent networks

http://startupquote.com/

• Disruptive innovation is everywhere

• Every company, regardless of size needs to act like a start-up

• Not just innovation, but continuous innovation

• Combine of the use of open-source software, agile development methodologies and ferocious, customer-centric, rapid iteration.

"My own definition of a start-up is an institution asked to create something new under conditions of high uncertainty…This has nothing to do with company size.” Eric Ries

THE LEAN START-UP MOVEMENT

http://madebymany.com/signals/the-lean-startup-movement

TECH & BUILD TEAMS

DIGITAL MARKETING

TEAM

WIDER MARKETING

TEAM

RELATED TEAMS/REST OF THE BUSINESS

As the benefits of agile principles (e.g. test and learn) become apparent to those most often interfacing with agile teams, adoption spreads

THE PROGRESSION OF AGILE

“The notion of ideas as this singular thing is a fundamental flaw. There are so many ideas that what you need is that group behaving creatively. And the person with the vision I think is unique, there are very few people who have that vision.. but if they are not drawing the best out of people then they will

fail.” - ED CATMULL, PRESIDENT OF PIXAR

CREATIVE PROCESS INVOLVING A LARGE NUMBER OF PEOPLE OFTEN FROM DIFFERENT DISCIPLINES MARSHALLED AROUND A VISION WORKING AS A TEAM

CREATIVE CULTURE…

http://www.flickr.com/photos/daviddelarosa/

"We say we are director led, which implies they make all the final decisions, [but] what it means to us is the director has to lead.. and the way we can tell when they are not leading is if

people say 'we are not following'.” - ED CATMULL, PIXAR

CREATIVE CULTURE…

• Resourcing for projects is purely voluntary

• Project leaders pitch developers to generate interest

• Engineers decide which projects sound interesting to work on

ENGINEERING CULTURE…

Agile Development is often centred around the belief that the best results come from self-organising, small, nimble teams.

What if we worked like that in communications?

• A way of remaining agile as the company scales

• Large number of small, multidisciplinary teams, 8-10 people

• Each responsible for a focused area of service

• Customer-centric, focused improvement, speed of innovation

AMAZON AND THE ‘TWO-PIZZA’ TEAM

• Research into marketing structures and resourcing - 30 in-depth interviews, quant survey 170 respondents

• A new phase: not just change, but continuous change

• Economic pressures - constant evaluation of organisational structures, processes, roles, skills


http://econsultancy.com/uk/reports/digital-marketing-organisational-structures-and-resourcing-best-practice-guide

Identified 4 distinct types of online presence:

1.Transactional e-commerce site

2.Services-oriented relationship building site

3.Brand building site

4.Publisher, portal or media site

A KEY SHIFT IN MINDSET

Several key trends behind this:

• Product owners establishing direct relationships with consumers

• Increasing role of owned media, brands and retailers becoming content producers, and more skilled in merchandising, editorialising, content marketing and service provision

• Publishers and content owners seeking new revenue streams and moving toward e-commerce models, applications and services

Mediated Direct to consumer

Campaigning Always-on

= increasing blurring of lines between these distinctions, enhanced merging of roles, functions, and skills required


• Competitive, rapidly changing markets and increasing channel complexity

• Multiple and sometimes competing internal priorities

• Balancing outsourcing with in-sourcing, and specialism with generalism

• How best to apply adaptive resourcing to emerging channels

• The tensions created by blurred boundaries, and notably the delineation between Global, Regional and Local

The challenge of resourcing:


Hub-and-spoke – 35%

Centre of Excellence – 42%

Multiple Hub-and-spoke – 3%

Fully integrated – 0%

Dispersed – 20% A MODEL FOR DIGITAL STRUCTURAL MATURITY

Ecommerce

Digital Marketing

E-Business

Strategy & Planning

SEO PPC

CRM

Affiliates Display

Analytics/data

Content Marketing

Social media

UX

Design

Content/UX

Mobile

Operations CMS

Small change

request

Tech/Build

Brand

Customer

Insight

Brand strategy

Large scale

request

Web Build

(Social

Media)

In organisations with a heavy Etail focus, digital marketing is a part of e-commerce

MARKETING & TECHNICAL

• No single dominant structure for how technical infrastructure and web build capability is positioned in relation to the digital marketing

• But a common challenge in how best to prioritise digital projects across the business, and ensure agility within these structures.

• In some instances this has led to the growth in the role of intermediary product or project manager positions.

• Increasing demand/potential shortage: data/analytics, social media

• Increasing requirement for ‘T-Shaped’ people

• Both depth of experience in particular disciplines and an inherent understanding of the broader context of their work

TALENT

• Owns the whole process of creating and executing products that audiences love

• From product strategy/vision to the detailed delivery and ongoing running

• T-Shaped people who can both co-ordinate and inspire

• Tech to media to…?

THE RISE OF PRODUCT MANAGEMENT

Tech build

UX

Strategy

Content marketing

Customer insight

Ecommerce

Product management

Tech build

UX

Strategy

Content marketing

Customer insight

Ecommerce

Product management

Tech build

UX

Strategy

Content marketing

Customer insight

Ecommerce

Product management

Tech build

UX

Strategy

Content marketing

Customer insight

Ecommerce

Product management

Tech build

UX

Strategy

Content marketing

Customer insight

Ecommerce

Product management

Tech build

UX

Strategy

Content marketing

Customer insight

Ecommerce

Product management

Tech build

UX

Strategy

Content marketing

Customer insight

Ecommerce

Product management

MAKING ROOM FOR INNOVATION

• Walmart buy a small Silicon Valley start up (Kosmix) & turn it into WalmartLabs

• A unit designed to push Walmart’s capabilities in mobile and social R & D

• Protects culture, allows for agility, attracts tech talent, space to create the future

MAKING ROOM FOR INNOVATION

McKinsey :`Boosting Returns on Marketing Investment’ Recommends brands spend 80% of their budget on banker strategies and tactics, and 20% on learning through well

structured tests.

https://www.mckinseyquarterly.com/Boosting_returns_on_marketing_investment_1602

A WAY IN TO AGILE…

70% of the content should be low risk, bread and butter marketing

20% should innovate off what works

10% should be high risk ideas that will be tomorrow's 70% or 20%

THE 70, 20, 10 MODEL


ORGANISATION 3.0


AGENCY 3.0


Eric Edge, Facebook




Nadya Powell, Dare

DIFFERENT APPROACHES TO ORGANISATIONAL INNOVATION

60% under 10 years old

36% under 5 years old

66% tech manufacturers or web-based

ENTITLEMENT KILLS

Disruptive Small-d democratic Transparent Tech savvy Design savvy Local and global Nimble Values-driven

Inside-out

Outside-in

Boxed-out

INNOVATION CAN BE

INSIDE-OUT INNOVATION

“The Chipotle burrito is very similar to the iPhone.” - SLATE MAGAZINE

CHIPOTLE / THE APPLE OF THE FAST FOOD INDUSTRY?

Chipotle / Going back to the start

http://www.youtube.com/watch?v=aMfSGt6rHos

http://www.youtube.com/watch?v=aMfSGt6rHos

CHIPOTLE / RESULTS

$2.2 billion in revenues. Revenues have tripled since 2006.

1200 restaurants across the US, UK and Canada. Plans to open 165 more this year.

11.2% increase in same-store sales last year

25.9% restaurant operating margins

500% Chipotle stock up 50% on the year and over 500% over 5 years

Build the best product, cause no unnecessary harm, use business to inspire and implement solutions to the environmental crisis.

- PATAGONIA MISSION STATEMENT

PATAGONIA / WEAVING VALUE-DRIVEN INNOVATION INTO THE FABRIC OF YOUR COMPANY

PATAGONIA / TRAIL-BLAZING TRANSPARENCY

PATAGONIA / RESULTS

$500 million in 2011 sales

30% growth over the last two years

$500,000 worth of product recycled in The Common Threads Initiative, with over 25,000 pledging to change their consumption patters

KLM / TRANSPARENCY, FALLIBILITY & THE HUMAN TOUCH

OUTSIDE-IN INNOVATION

“It’s people united, and one problem as a springboard for innovation. It’s taking generous collaboration to action. The power of this is unlimited.” - MARIA MUJICA, DIRECTOR FOR GUM AND CANDY, KRAFT LATAM

SOURCING THE CREATIVITY OF THE WORLD

Procter and Gamble aims for at least 50% of all new product and service ideas to come from outside the organisation.

BOXED-OUT INNOVATION

“GG is different and its unique in how its structured. I'm totally up for the way its structured, its like as a community we're challenging the big boys!!!” - MEMBER COMMENT

GIFFGAFF/ BUILDING A BRAND AND THEN GIVING IT TO YOUR CUSTOMERS

GIFFGAFF / COMMUNITY-LED INNOVATION THAT PAYS

24/7 support in avg. 90 seconds

100% of questions asked answered by the community

Top earner - £17,000 over 12 months

Highest Customer Satisfaction (CSI) in the sector

Highest Community Health Index in the world

SO, IN CONCLUSION…

EVOLVE IMMEDIATELY. ENTITLEMENT KILLS. “Don't be a sitting duck. See the

big picture. Find the pain points, see patterns taking shape and act.

Evolve immediately. Entitlement kills.” - AJAZ AHMED & STEFAN OLANDER

BE ALL-IN “The difference between a company whose CEO and leadership team have an "all-in" mentality regarding innovation, and one whose leadership supports innovation merely at an abstract level, is unmistakable—and so is the impact on the company's culture and results.” - JAMES P. ANDREW; SENIOR PARTNER & MANAGING DIRECTOR AT THE BOSTON CONSULTING GROUP

DEFAULT TO OPEN

Smart organisations default to open, rather than closed ways of working.

BE BRAVE

“The most important thing we do to encourage innovation is give people the freedom to fail” - ROBERT KOTICK, ACTIVISION BLIZZARD (NAMED ONE OF FORBES’ MOST INNOVATIVE LEADERS)


ORGANISATION 3.0


AGENCY 3.0


Eric Edge, Facebook




Nadya Powell, Dare

http://econsultancy.com/uk/reports/the-progression-of-agency-value

21 in-depth interviews with senior agency contacts

across Europe: Creative, Media, Direct, Digital, Marketing Technology

• What is the role of the agency?

• Commoditisation of services

• Divergence/Convergence of services

• Complexity/proliferation of devices

• Big data – joining it up, real-time, automation, attributing value

• Shift to platforms

• Speed of adoption/transition

•Delivering services •Staging experiences •Guiding transformations

THE PROGRESSION OF AGENCY VALUE

Delivering Services Staging Experiences Guiding Transformations

Data Siloed data sources, basic

data analysis tools

Multichannel, Joining up data, basic attribution,

automation

Integrated digital and online/offline, real-time decisions, sophisticated

analysis

Technology Technology restricts, legacy

platforms Agile development,

software-as-a-service tech

Customised dashboards, scalability of the cloud, actionable attribution

modeling

Skills Paid media skills, vertical

skill sets, poor training

Specialists & Generalists, Creative Technologists,

Tech skills

T-shaped, deep knowledge, human layer over tech,

knowledge sharing

Culture Rigid structure, Push not

Pull, Waterfall project mgt

More fluid structure, collaborative environment,

more project work

Interdisciplinary, cross-functional, small, nimble teams. Permission to fail.

Entrepreneurial

THE PROGRESSION OF AGENCY VALUE


ORGANISATION 3.0


AGENCY 3.0


Eric Edge, Facebook




Nadya Powell, Dare

Free range creativity

Craft collective

Agile

AGENCY 3.0: DARE 24

"teams are formed around individual client needs, and when those needs are satisfied, the team is dispersed"

http://www.cocollective.com/

AGENCY 3.0: CO:COLLECTIVE

AGENCY 3.0: PARTY

Creative is at the

heart of everything

They follow the “cloud

model”

They’re not an

advertising agency

STRUCTURE CULTURE PROCESS

key themes PEOPLE

key themes INNOVATION

PLEASE FEEDBACK

DARE SESSION FOUR 27th September 2pm – 6pm