Tag Archives: UX

Big Data – Panacea or Pandemic?

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You’ve probably heard that “data is the new oil” (but you just need to know where to drill?). Or alternatively, that the growing lakes of “Big Data” hold all the answers, but they don’t necessarily tell us which questions to ask. It feels like Big Data is the cure for everything, yet far from solving our problems, it is simply adding to our confusion.

Cartoon by Thierry Gregorious (Sourced from Flickr under Creative Commons – Some Rights Reserved)

There’s no doubt that customer, transaction, behavioral, geographic and demographic data points can be valuable for analysis and forecasting. When used appropriately, and in conjunction with relevant tools, this data can even throw up new insights. And when combined with contextual and psychometric analysis can give rise to whole new data-driven businesses.

Of course, we often use simple trend analysis to reveal underlying patterns and changes in behaviour. (“If you can’t measure it, you can’t manage it”). But the core issue is, what is this data actually telling us? For example, if the busiest time for online banking is during commuting hours, what opportunities does this present? (Rather than, “how much more data can we generate from even more frequent data capture….”)

I get that companies want to know more about their customers so they can “understand” them, and anticipate their needs. Companies are putting more and more effort into analysing the data they already have, as well as tapping into even more sources of data, to create even more granular data models, all with the goal of improving customer experience. It’s just a shame that few companies have a really good single view of their customers, because often, data still sits in siloed operations and legacy business information systems.

There is also a risk, that by trying to enhance and further personalise the user experience, companies are raising their customers’ expectations to a level that cannot be fulfilled. Full customisation would ultimately mean creating products with a customer base of one. Plus customers will expect companies to really “know” them, to treat them as unique individuals with their own specific needs and preferences. Totally unrealistic, of course, because such solutions are mostly impossible to scale, and are largely unsustainable.

Next week: Startup Governance

 

Tech, Travel and Tourism (revisited)

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Just over two years ago, I posted a blog on how the tourism and travel industries needed to embrace the opportunities brought about by digital disruption. Having been on half a dozen overseas trips in the past 12 months, I can see that there have been some improvements in the traveler experience, but there is still a lot of room for improvement…

One of the biggest benefits has been the expanded integration of public transportation information into Google Maps. Navigation and route planning, right down to which platform to board from or which subway exit to take, has been a huge boost to the traveler UX. Many cities are now using integrated stored value cards for public transport, but limitations still exist: for example, some systems don’t make it that easy for overseas visitors to obtain the card itself, others make it hard to re-load other than by cash; while only a few systems, like Hong Kong and Japan, support multiple point-of-sale transactions for shops, restaurants and other services.

Another plus for frequent travelers has been the increased adoption of chip-enabled, e-passports which streamline the immigration entry/exit process (but only for participating countries, of course). Laborious paperwork still exists in many cases with arrival/departure cards and customs declaration forms – but over time, these processes should become more streamlined with the adoption of digital IDs and biometrics.

Using local mobile phone networks may have gotten easier with compatible operating systems, but even with pre-paid travel SIM cards and data packages, access costs are still disproportionately expensive for overseas visitors. Sure, there are more and more public WiFi services and hotspots available, but most still require users to provide personal data and/or reveal security weaknesses. Even though I recently purchased a mobile pass to access “free” WiFi services abroad, it’s hard to see what value it offers, because it only works after I have already logged onto the WiFi network.

Getting flight information, notifications and alerts via SMS and e-mail has improved considerably, along with easier online booking tools and mobile check-in solutions – and of course, QR codes now support paperless boarding cards. But I’ve noticed that some airline apps don’t support full integration with mobile phone wallets, and consolidating ticketing and invoicing information (e.g., for consolidated expense reporting) from multiple airlines and booking platforms still feels a long way off.

Finally, a constant irritation for travelers are the card transaction fees that most hotels still pass on at checkout – as if many guests are likely to pay in cash! – compounded by the FX fees that the credit card companies also like to charge. All up, this can mean an average of between 3% and 5% in additional fees, in a situation where hotel guests are something of a captive audience. Transaction fees remain a target for further disruption….

Next week: Token ring – a digital ID solution

 

 

 

Gigster is coming to town….

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Melbourne’s Work Club recently hosted Gigster Senior Project Engineer, Catherine Waggoner, in conversation with Venture-Store’s George Tomeski. Part of Startup Victoria‘s Fireside Chats, it likely herald’s Gigster opening an office in Melbourne, to service local clients and to tap into the local developer community.

gigsterFor the uninitiated, Gigster describes itself as the “world’s engineering firm”, that helps clients scope, design and build software, apps and digital products. Using an established product development methodology, and drawing on the resources of a 1,000 strong network of freelance designers, developers and product managers, Gigster is taking much of the pain out of the costing and requirements process for new projects, as well as building a growing client base of enterprise customers.

Not mincing her words, Ms Waggoner opened her remarks by commenting, “The software development industry model is f*#$ed”, because:

  • Requirements are poorly defined
  • Scoping is laborious
  • Development costs blow out, and
  • The whole process is not very transparent and not very accessible.

As a case in point, she mentioned the significant cost disparity between what some digital design agencies or app studios might quote for building an iOS product compared to what Gigster would estimate. By: breaking projects down into the distinct stages of scoping, design and pre- and post-MVP; only engaging the “best of the best talent”; using proprietary tools both to estimate fixed rate costs (rather than billable hours) and to define and source solutions; and re-using content from a library of “Community Software” resources, Gigster is able to deliver quality projects in shorter time, and on more modest budgets. For example, based on the large number of projects that they have fulfilled, their “Gigulator” estimating tool incorporates 5,000 possible features.

From an investor perspective, Mr Tomeski mentioned that the “VC inflexion point is getting much earlier” in tech startups. Meaning, with lower development costs (and potentially, reduced valuation multiples), investors are looking to get in sooner, with lower exposure, but still generate reasonable returns on exit, thanks to cheaper establishment costs.

Of course, Gigster sits at the heart of the gig economy, a huge issue when it comes to discussing the Future of Work. Interestingly, many of Gigster’s contractors are themselves startup founders, who freelance while building their own businesses. But such is the strength of the network, something like 35%–40% of their contractors work full-time for Gigster – they like the flexibility combined with the continuity. Many of the contractors are referrals from existing team members, and a number of teams (known at Gigster as “houses” – presumably a frat thing?) have bonded to such an extent that they get allocated specific projects to work on together, even though they themselves may be working in different locations, based on previous projects.

Working for Gigster is probably a career choice for some contractors, because there is a variety of projects to work on, and the opportunity to be involved from start to finish. Which may be the opposite if working in a more corporate or enterprise environment, where work may be routine, repetitive and reasonably narrow in scope.

If Gigster does decide to set up shop in Melbourne (with encouragement from
InvestVictoria) they will be joining the likes of Slack, Stripe and Square, tempted by financial and other incentives. Such a move may challenge a number of local digital agencies, who will face even more competition for talent and customers.

According to Ms Waggoner, enterprise clients represent 40% of the business, and should comprise 60%-80% very soon. Not only that, but the average deal was initially $15k, now it’s more like $100k. However, enterprise clients have a much longer sales cycle. Plus, many innovation teams within enterprises are more like loosely formed groups of niche experts, so they need training on how to think like a startup. When you consider the greater dependency on legacy software by corporate clients (where it may make financial sense to retire some assets and build afresh, but the emotional disruption can be huge…), combined with the greater emphasis placed on after-sales service, Gigster has had to adapt its business model accordingly.

But Gigster must be doing something right. They’ve stopped outbound marketing and prospecting, relying on in-bound leads, repeat business and client referrals. There has been a shift from a sales focus to a customer focus, complete with a dedicated customer success team.

A number of audience questions related to getting VCs interested in your idea: What do they look for? How do they assess opportunities? How far should you go in building a product before you can attract funding? What’s the best way to validate an idea? etc. Much of this is about product/market fit, building the right team, getting customer traction, and executing on your strategy (aka Product Development 101.) As part of her closing comments, Ms Waggoner noted that unlike some of the high-profile VC funds (e.g, Y-Combinator, Techstars and 500 Startups) many VCs are becoming more sector specific, because they prefer to invest in what they know and understand.

Next week: Building a Global/Local Platform with Etsy

Design thinking is not just for hipsters….

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In recent months, I have been exploring design thinking, a practice I first encountered nearly 20 years ago (when it was called user-centred design). Whether we are talking about UX/UI, CX, human-centred design, service design or even “boring” process improvement, it’s important to realise that this is not just the domain of hipsters – everyone can, and needs to understand how these design thinking techniques can build better product and service outcomes in multiple applications. Here are three real-world examples to consider:

Curved Space-Diamond Structure by Peter Pearce, Hakone Open-Air Museum, Japan (Photo © Rory Manchee, all rights reserved)

Curved Space-Diamond Structure by Peter Pearce, Hakone Open-Air Museum, Japan (Photo © Rory Manchee, all rights reserved)

1. Financial Services – a case of putting the cart before the horse?

A major bank was designing a new FX trading system, to replace a labour-intensive legacy system, and to streamline the customer experience. The goal was to have more of a self-service model, that was also far more timely in terms of order processing, clearing and settlement.

The design team went ahead and scoped the front end first, because they thought that this was most important from a customer perspective (and it was also a shiny and highly visible new toy!). However, when I heard about this focus on the front end, I was prompted to ask, “What will the customer experience be like?” By automating the process from a front end perspective, the proposed design would significantly diminish the need for customer interaction with relationship managers, and it meant they would have less direct contact with the bank. Whereas, part of the bank’s goal was to enhance the value of the customer relationship, especially their priority clients.

Also, by starting with the front-end first, the design did not take into account the actual mechanics and logistics of the middle and back office operations, so there were inevitable disconnects and gaps in the hand-off processes at each stage of the transaction. (This is a common mistake – a colleague who consults in the retail sector told me about the online storefront for a major retail chain that looked really pretty, but revealed no understanding of the established supply chain logistics and back-office order fulfilment processes.)

The bank team had a rethink of the storyboarding and workflow analysis, to make sure that the customer experience was streamlined, but that there were still adequate opportunities for customer touch points between client and relationship manager along the way.

2. Construction industry – inside and looking inwards

Another colleague told me of a specialist supplier in the construction industry, that was undertaking a review of their processes and service design model. From an internal perspective, everything looked fine. The customer orders came in, they went into production, and were then delivered according to the manufacturing schedule.

However, there were two stages in the process, that did not work so well from a customer perspective:

First, customers did not receive any confirmation or acknowledgment that the order had been submitted; so they might be worried that their order had not been received.

Second, once the order had gone into production, there was no further customer communication until it was ready to be delivered. Meanwhile, the client’s own schedule might have slipped, so they might not be ready to take delivery (we’ve all seen those moments on “Grand Designs”). Resulting in the supplier having to hold unpaid for work-in-progress in their warehouse.

For the supplier, it was a simple case of implementing a formal acknowledgment process, and a check in with the client prior to fabrication and a follow-up prior to delivery to make sure schedules were aligned.

3. Energy sector – gaining empathy in the field

A friend of mine ran a local distribution and installation business for an international supplier of energy switching gear. They specialised in remote operating systems, most notably used in indigenous communities. Head office was in Europe, and the clients were in outback Australia – so communications could be challenging. The overseas engineers would not always appreciate how time critical or simply inconvenient power outages or interruptions could be. “We’ll fix the software bugs in the next upgrade,” was usually the response.

Then the local business started inviting their European colleagues to come and work in the field, to get some downstream experience of how customers use their products. It was also a good opportunity to train technical staff on how to handle customers.

One time, a visiting engineer was in a remote community, trying to fix a power operating system. When Europe said they would take care of it in the next upgrade, the engineer pointed out that he was with the client there and then, and that without power, the community could not function properly, and that Head Office had to solve the problem immediately, even if it meant working overnight. The issue was sorted right away.

If nothing else, the visiting engineer, schooled in siloed processes and internal systems at Head Office, had managed to gain empathy from working directly in the field.*

While none of these examples seems to involve cutting edge design thinking, they do reveal some fundamental service design and product development concepts: the need for empathy, the value of prototyping and testing, the role of user scenario and workflow analysis, and the importance of challenging existing processes, even if they seem to be working fine on the inside.

*Footnote: This reminds me of a time many years ago when I was travelling around Beijing in the back of a cab, between client visits, calling my production team in the US, asking them to investigate a problem the local customers were having in accessing our subscriber website. “The Chinese government must be blocking the site”, I was told. Given that most of the clients were state-owned enterprises, or government departments, I thought this was unlikely. Turns out that the IT team in the States had “upgraded” the SSL without informing anyone and without doing multiple site testing first. Some clients had problems logging on from slower internet services, because the connections timed out. Being in the field, and speaking directly after witnessing the client experience for myself enabled me to convince my colleagues of what the cause actually was. Although we had to implement an interim workaround, going forward, every software upgrade or product modification was benchmarked against multiple test sites.

Next week: More on #FinTech, #Bitcoin and #Blockchain in Melbourne