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Business Transformation - Agile Innovation drives Organic growth

Sophie Vandebroek, PhDXerox Chief Technology OfficerPresident, Xerox Innovation Groupwww.xerox.com/innovation

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You have known us as a copier/printing company

The more progress the world makes

the more complicated the world becomes.

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Healthcare

Finance & Accounting

Human Resource Services

Customer Care

Transportation

Managed Print Services

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Graphic Communications

Were helping clients in areas you might not expect

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User pain points & dreams Foster an innovative culture Leverage the worldManage a portfolio of options& introduce new business models

Agile Innovation best practices

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So I wanted to share with you today PARCs innovation best practices that can help you improve how you do innovation in order to create greater impact and reduce risk.

Let me start by going through the first four highlighted here, which are key practices that I believe apply to every company and every industry.

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Dreaming sessions: understanding clients and partners pain points and dreams

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What people sayWhat people doand what people say they doare entirely different things

Ethnographic experts

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Margeret Meads fundamental insight about peoples inability to accurately recount their behaviors to develop techniques that allowed us to observe existing behaviors, and devise new and novel solutions to problems that havent even been expressed yet.

But that knowledge can actually be limiting when youre aiming for transformative innovation.

Its as Henry Ford is attributed to have famously said: [READ QUOTE]

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User pain points & dreamsFoster an innovative culture Leverage the worldManage a portfolio of options& introduce new business models

Agile innovation best practices

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So I wanted to share with you today PARCs innovation best practices that can help you improve how you do innovation in order to create greater impact and reduce risk.

Let me start by going through the first four highlighted here, which are key practices that I believe apply to every company and every industry.

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Diversity is more than the right thing to do; its critical to our success as a company.

Ursula Burns, Xerox CEO

An innovative culture is an inclusive culture

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An innovative culture is also a learning culture

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The third source of power I want to talk about today is the power of an innovative culture.

What do I mean by that?

An innovative culture is a learning culture.

Its creating an environment that encourages your people to not avoid risk, but embrace it.

Examine your companys attitude toward risk and failure. Do people feel empowered?

Create an environment where your people bring their best to your business.

In many ways its going back to each persons childlike curiosity and desire to explore before we all get too afraid to make mistakes and take risks.

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Xeroxs agile, iterative services innovation process

Customer pilots

Prototyping

Multiple iterationsof the Minimum Viable Product

Commercialization

Design workshops

Modeling

Field studies

Multiple benefits of this agile approach:

Solve the right problemUnderstand how value is createdAvoid costly revisions after launch

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instead of thinking only in terms of the grand investments youre going to make and expected ROI from them, or in terms of the R&D budget you dont have,

Think more in terms of conducting a bunch of rapid, low-cost, mini experiments. And not just technical experiments, but also business experiments to test new business models, which are often necessary to drive adoption of new technologies.

Even as a large company, borrow/ adapt best practices from agile programming, lean startups, etc. -- all which have one mindset in common: validate assumptions early by building a minimal viable product, test with people, pivot iteratively. Dont just react and adapt, but learn and build on those learnings.

I want to emphasize that what I mean here isnt just fail fast and work fast its about evolving learnings.

The second practice around agility is to make your first hurdle for success as low as possible to start with.

Dont start by going into the heart of existing technology, only later increase the hurdles as you learn more.

Its counter intuitive, but will be disruptive in the long term.

Make it simple to serve underserved customers.

Lets look into this idea a little more

This agile mindset can, however, be reinforced through supporting processes.

We have developed a repeatable methodology for service innovation, in which we typically start with ethnographic field studies to understand what users actually do and identify problems that they are facing. Then we use those observations to build models of users and work practices/information flows within organizations. Then we start by building experiential demos to engage actual end users who would be using the system to help us design a usable system that meets their needs. Then we develop prototypes of new solutions that we test with additional users and iterate based on feedback.

: There are multiple benefits from using this approach:Weve already talked about choosing the right problem to solve. We focus on the right problem by thinking about the entire system and how value is created. This agile approach also allows us to resolve the key uncertainties during development so we can avoid costly re-working later or worse, developing a product that no one wants.

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User pain points & dreamsFoster an innovative culture Leverage the worldManage a portfolio of options& introduce new business models

Agile innovation best practices

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So I wanted to share with you today PARCs innovation best practices that can help you improve how you do innovation in order to create greater impact and reduce risk.

Let me start by going through the first four highlighted here, which are key practices that I believe apply to every company and every industry.

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Not all the smart people work for you, so you better go find them, connect to them, and build upon what they can do. Henry Chesbrough

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Create an open innovation ecosystem

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So what do we mean by Open Innovation?

Heres one definition, adapted from U.S. business management expert and U.C. Berkeley professor Henry Chesbrough, who popularized the term.

But at PARC, we like to call this open, collaborative innovation.

Because open does NOT mean showing everything you have or giving up control!! it means collaborating with people outside your company to achieve mutually beneficial goals, whatever they are.

What kind of motives do companies have for engaging in open innovation? Companies come to us, at least, for a variety of reasons.

Sometimes its because theyre #1 and want to stay #1, or theyre #2 and want to become #1.

Sometimes its because they see a technology trend or industry shift looming over the horizon, and they know they need to expand their options.

But almost always its because they are trying to advance or grow their business in some way, whether its capturing their competitors customers, entering new markets, or just creating entirely new business options

User pain points and dreamsFoster an innovative culture Leverage the worldManage a portfolio of options & introduce new business models

Agile innovation best practices

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So I wanted to share with you today PARCs innovation best practices that can help you improve how you do innovation in order to create greater impact and reduce risk.

Let me start by going through the first four highlighted here, which are key practices that I believe apply to every company and every industry.

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Portfolio: not just where you are today but where you want to be

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This is an example of an innovation portfolio where you have investments in your core, in extensions from your core into new technologies for your existing markets and expanding into adjacent markets, and in options that allow you to pursue entirely new options with new technologies.

My point is that its not enough to just map your investments and look at where you are. You should make strategic decisions on how much money you want to invest in each segment in order to drive a strategy in defending your core markets and expanding into new markets.

These often go hand in hand with new business models

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Xerox Innovation: Creating the future with you

Thank you!