Common Problems Startups Face – A design thinking outlook

Common problems startups face – A Design thinking outlook

I have been directly associated with startups since 2006. That’s when I started my career as a member of a venture capital investment team. All the way to my recent years consulting them and young businesses, I have heard a multitude of problems that startups face. Problems that can largely be categorized under two main causes.

The first one of course, being investments.
The second, being the lack of traction, or growth in business.

With regard the problem of funds, you could further break it up in to funds you must have, and funds that are good to have.

Literally all of us are, more often than not, influenced by awe-inspiring startup stories. About those startups in the world that seem to be on a blistering growth path. With people and funds literally queuing up for an opportunity to invest in them.

Watched the movie ‘The Incredible Hulk’? The Hulk and the Abomination in that are like those few startups that receive disproportionately high amounts of funding.

Everyone is not like them. And even in their case, of the two, only Hulk was relatively stable with the superpower. The Abomination, as the name goes, became that way because of his lust for super-strength to beat the Hulk.

Similarly, even if all startups could be funded like that, or like Uber and PayTM and Zomato and others have been, there is no guarantee they will succeed. Because making a business stable takes managing a lot more variables than merely the investment one.

Which brings us back to the other alternative – funds you must have.

This is the basic minimum investment that you would need to get your startup rolling. It isn’t too tough to calculate it. Just make sure you have sufficient buffer. And keep checking those levels so you don’t realize it’s bad only once you’re broke. The advantage of this mindset, is that even if external investments never come, your startup will be built on a solid foundation and a sound business model. That, as opposed to one of hyper-experimenting, as is sometimes the case with super-funded startups. Take the case of TinyOwl hiring and almost immediately firing hundreds of enthusiastic freshers back in the day. Or Ola paying USD 31.7 million for FoodPanda a year and a half ago, only to fire a lot of the staff and suspend its operations recently.

While such news pieces might be good to hear, they are often not something to be proud of.

A bootstrapped startup will have its share of proud moments too. And they will be far more grounded and not the kind that could be easily taken away, unlike the case with some over-funded ventures.

Now let’s look at the other main problem area of startups. The lack of traction or growth.

In my book, Design the Future, I mention what is to me, a wonderful example from both an investment angle and a strategic one that depended solely on the understanding of customer needs.

One portfolio company whose growth my boss and I used to oversee, was in the car rental space. Around 2009, it was on its way to be the largest player in India, right on the heels of Meru. Meru was then leading the pack in terms of size of fleet.

However, what was interesting, was that Meru’s business had been built largely on debt. Ours had been built on equity. Which meant we were profitable sooner, and could scale much faster. Meru had just turned profitable around 2009-10, if I remember correctly.

And back then, our portfolio company was already onto the model of partnered fleet. That is what Uber is all about now. Our company was collaborating with small tourist vehicle operators to add their fleet and drivers to their own, in a revenue-sharing model.

Now think about this. A company founded in 2006, which was already employing a model that we in recent times popularly know of as Uber, what as of today, has a market capitalization of USD 69 Billion! And Uber was founded only in March of 2009 (conceptualized in 2008).

So what prevented our portfolio company from being the one valued at USD 69 billion?

In hindsight, a lack of better understanding of the stakeholders in the ecosystem, is my guess.

Our portfolio company and other players back then were perhaps used to a certain customer price level and profitability that they enjoyed in a tried-and-tested pan-India market.

However, perhaps we failed to see that we could considerably reduce the margins and incentivize the partner ecosystem, in an effort to gain massive scale.

And with customers, it is only in very select areas that if we offer something at a lower price, they won’t take it. But certainly not with transport.

So, Uber carpeted several countries with the initial attractive pricing, and more than encouraging partner revenue-sharing and incentives.

And companies like ours, that didn’t think huge enough, shrunk into insignificance in that particular space at least, which they had ruled for some years till then.

Putting investments and a better understanding of the stakeholder ecosystem together, it is not necessary that every business and every idea has to be Uber-sized!

You can as well remain small, exclusive and yet thriving in a small or select few areas or geographies, if that is your business vision. Or, as is the case with Uber, you can be the most recognized brand in ground transport.

What is most important, is to first decide where on that spectrum you want to be. Then you need to find out (not in meeting rooms, but by spending time with stakeholders), what their likes and dislikes are. What drives them, what their profit expectations are? And how flexible are they on pricing; or, is there a better way you can offer them what you do? Something that might completely be poles apart from how you offer it right now.

Scenarios in the startup ecosystem are limitless. And so are the possibilities.

Originally written for NODD app and posted here: link

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If you own, manage or work at a company, and are grappling with a complex challenge or are in need of innovation for growth, get in touch. More here.

And you might find my book, ‘Design the Future’ interesting. It demystifies the mindset of Design Thinking. Ebook’s on Amazon, and paperbacks at leading online bookstores including Amazon & Flipkart.

Context

One of the fundamental ingredients of an impactful innovation or successful design thinking exercise, is empathy. The ability to understand and share the feelings of another.

Often, in our enthusiasm to create something someone (a customer segment, employees, or even society), or to solve a problem for them, we tend to knowingly or unknowingly speed up the process. We skip the part of trying to understand the problem or the cause of it. Or the unexpressed need. We create, and we expect (or at least hope for) delight from those receiving our innovations or solutions.

This simple image I came across online gives great context to our urgency to solve problems or innovate. An infant is too young to realize or even see clearly, the flaw in this. If a simple flaw like this could be missed by most of us, what else might we be missing? How little effort are we taking to look at business innovation or problem-solving from the right ‘context’?

Source: link

Small efforts in understanding customer needs, go a long way. Apart from feeling appreciated and important, customers help us get closer to innovative solutions they are willing to pay for. The least we can do is look at their needs and problems from their perspective.

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If you run or manage a business, and innovation, strategy, problem-solving, customer experience or ideation are areas of interest, there are a few ways I can help. More about it here.

My book, ‘Design the Future’ is available as an Ebook on Amazon & Kobo, and as paperbacks across leading online bookstores including Amazon & Flipkart. Look forward to your review on Amazon once you’ve read it.

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Look forward to your views. For similar topics that encourage reflection and discussion, follow or subscribe (top right of the page). You can also connect with me onLinkedIn and onTwitter.

A Poem for Design the Future

Ava and Dr. Jimmy Patell, dear friends of mine, were extremely kind to gift me a poem that they wrote about my book on design thinking, Design the Future.

The poem itself is more priceless to me than the book. Really humbling.

Here it is.

Design the Future, what does it portend
What does it say, what message does it send
Does it help Managers in their work place
Or a simple layman in his home space

How can the processes that evolve
A family’s day to day problems solve
Or is it just solely business tools
Being espoused in some management schools

Well to clear the mystery of it all
Shrutin Shetty has taken a call
And made things clear by writing a book
That may well become the subject’s handbook

Friends, it may help giving the book a read
It may assist you in your hour of need
Solve the problem before others do
And get credit that is due to you.

– Ava and Jimmy


If you haven’t picked up my book yet, you can use the code JIMAVA here for a 25% off on the paperback. Paperbacks are also available across leading online bookstores worldwide, and ebooks on Amazon and Kobo.
If you do buy the book, would appreciate a review on Amazon once you’ve read it.

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Upbringing

Upbringing

Here’s a thought regarding upbringing. Views welcome; and especially so if you have kids and your parents either stay with you, or you visit each other often.

You know how curious for information kids are. And parents often ask them to say or sing something they have learnt, in front of family or in the presence of guests? As a parent, try to think of the reason why you do this.

“What is your intent behind requesting your kid to say or sing something in front of the family and/or guests?”

Is it more for amusement (and possibly family bonding) or to show-off your child’ progress, or something else?

And in case it is for ‘something else’, what is that something?

Similarly, ask your parents the same questions. Especially if your parents aren’t all that literate (or if you have grandparents, ask them as well).

What’s the thought/ point behind this?

Back in the day, grandparents or parents didn’t always have access to the best of education. In such instances, they would often request their kid to say something they had learnt. Especially in the presence of visiting family or friends. Is it possible that was less for amusement, and more as a matter of pride or accomplishment?

Nowadays parents have obviously received a good education (in most cases). They usually know know more than their kid does (be it something as basic as English, etc.). In such cases, is requesting your kid to say something in the presence of others more for amusement, and less out of pride or humility that the elders might have felt?

How does this matter?

Is it possible that in the past, those kids would sense the the humility and pride, and in present times, would sense the amusement? And would the reactions of kids be different given what they sense? And does that influence their actions? For instance, would that feeling of humility or pride they saw in their elders push them to strive harder? And in more recent times, do kids see themselves as being entertainment for elders, and therefore sometimes tend to strive to please or entertain instead?

While earlier generations were overly concerned about “what society will think” regarding different aspects of their professional and personal lives, are the current and younger generations very different? Aren’t the younger generations also overly dependent on social acknowledgement, attention and approval, even though it might be for contexts different from those of earlier generations?

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My book on design thinking titled ‘Design the Future‘ is out. If innovation, design thinking, problem-solving, human behaviour or ideation are areas of interest, am sure you will enjoy this book.
You can order your paperback copy via Amazon, Flipkart & Infibeam.
Would be great if you could leave a review on Amazon once you’ve read the book.

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Look forward to your views. And if you liked this post, do follow or subscribe to my blog (top right of the page) for similar topics that encourage reflection and discussion. You can also connect with me on LinkedIn and on Twitter.

My Book on Design Thinking titled ‘Design the Future’

Design the Future

Hi! As some of you might already know, my book on design thinking, titled ‘Design the Future’ is out!

Despite design thinking being several decades old, we are seeing increasing relevance in its application in our fast-paced lives today. I’ve read incredible books on the subject in the years I’ve been practicing it. However, I still find confusion & uncertainty among some of those who have been practicing it, as well as those merely trying to learn it.

‘Design the Future’ is an effort to reduce grey areas by building a stronger foundation. It covers the fundamentals, examples from around the world, and my observations, notes and learning of design thinking & human behavior.

If innovation, design thinking, problem-solving, human behavior or ideation are areas of interest, I’m sure you will enjoy reading this book.

Currently, paperbacks are on AmazonFlipkartInfibeam , and other online bookstores.

If you do read the book, I’d be grateful if you can leave me a review on Amazon.

You can reach me at ‘shrutin [at] ateamstrategy [dot] in’ with your views, or if you’d like me to answer any questions or doubts you might have.

Hope you enjoy reading the book & find it useful in supplementing your design thinking skills.

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Look forward to your views. And if you liked this post, do follow or subscribe to my blog (top right of the page) for similar topics that encourage reflection and discussion. You can also connect with me on LinkedIn and on Twitter.

Gucci’s Packaging – Not so Gucci

Gucci’s Packaging – Not so Gucci

I recently conducted an interactive session on Design Thinking at a leading investment bank. It might be easy to assume that applications of design thinking at an investment bank are limited. It is quite the opposite though. And the applicable scope of design thinking just seems to grow bigger with each passing day. The team was also kind enough to present me with a thoughtful gift at the end of the session. A Gucci tie.

Now, once you’re in the design thinking fold, you are always processing and assessing products and services. As you might have noticed, the tip of the tie is a little crumpled. If I was the manufacturer of ties that retailed at anything between $60-240 or more, I would have been concerned about the experience a customer goes through of opening the packaging and seeing the product as well.

The tie came in a tall box which was in a slightly taller paper bag, fastened with an embossed ribbon. When you hold the bag upright however, the tie drops inside thanks to that often-neglected phenomena called gravity. This causes creases at the tip of the tie. Now while many might tell you it is ok to iron a tie, it is not something I’d recommended you did often. And certainly not something you would want to do with a brand new tie.

While there might be several ways to package it in a way that leaves an impression with the customer, it isn’t something I’ll spend time thinking of right now. The easy way for Gucci to solve this problem, would be by merely placing a card paper insert which is fixed to the sides of the box. It would hold the tie in place at the top, like a clothes hanger. That way, the tip of the tie would never touch the bottom of the box when held upright.

Little things go a long way in improving how customers interact with your product. And how they remember it.

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Why Design Thinking is Here to Stay

Why Design Thinking is Here to Stay

A close friend recently shared this article titled ‘Why Design Thinking will fail’, written in 2013 by Jeffrey Tjendra. Jeffrey is a designer entrepreneur and strategist. Among some of us friends, there was were points of disagreement on the article. Jeffrey does seem to have a good understanding of design thinking. This post, however, is an effort towards taking a closer look at each point mentioned there. And to see if it makes sense or not. All of this, with my limited but growing knowledge of design thinking.

Before I begin, here’s a quote by Mara Wilson. While her quote describes storytelling, I believe it offers a more far reaching explanation. With products and services too, for instance. She said, “The more specific you get, the more universal it is. (It’s a special alchemy of storytelling).” – Mara Wilson

Back to the article, here goes:

  1. Misperception of Meaning – I’ll agree, it can be misleading to some. I use either ‘human-centered’ or ‘user-centered’ design thinking in an attempt to bring a little more clarity, especially when interacting with people I believe might misinterpret the meaning.
  2. Loss of Meaning – Can’t do much about that. A lot of effective methodologies often see phases of hype and a lot of randomness being packaged and sold in its name. But as the dust settles, only the real stuff and an increased respect remains.
  3. Misunderstanding and Not Accepting Creative Elements – True. However, any company or more specifically, a management that has ever worked on any form of creativity or innovation, knows how boring, full of trials and iterations, full of mess and uncertainty it can be. Look at your kid’s school projects for instance. If it isn’t too simple, it is bound to take a lot of ‘random’, before it starts to make sense. Anyone who doesn’t understand that, will surely not use design thinking. And that’s alright.
  4. Lack of Business Elements – Coming from a management and finance background, with experience in strategy and marketing, I tend to build those critical business aspects to a design thinking project. And that is especially why the design thinking team needs to have a wide-enough assortment of skillsets. Using only UI/UX people or ethnographers or psychologists is not going to do the trick.
  5. Language and Perspective Barriers – There have been worse instances of communication gaps. For instance, if you have heard the almost unbelievable and heroic story of the Gimli Glider. An obvious technical specification got so conveniently ignored, that it put at risk, 69 occupants aboard a Boeing 767. Read the fascinating story! So, it just boils down to the intention and seriousness of the parties involved. Nothing is foolproof or idiot-proof. But a lot of change and innovation can be brought about with the right intentions. And no amount of left-brain learning and practice can fix unpredictable situations either. Because a lot of left-brain thinkers often learn a process from end to end. Any deviation could potentially leave them baffled. Creative thinking, on the other hand, helps one focus on the fundamentals. On understanding the building blocks more and more. And then, irrespective of situations or deviations to them, there is often more clarity as the building blocks can be used to better understand complexity. And it’s often easier to communicate fundamental building blocks across language barriers, as opposed to communicating complexity to begin with.
  6. Missing Future – Even design thinking veterans like IDEO have made mistakes, overestimating future demand of tech products. A strong problem or opportunity statement (which is open to being updated when you learn more about the end-user) helps reduce the risk. As does an unbiased and strong mechanism to interact with, and observe and understand needs, behaviours and desires of end-users, and capture that information towards building a solution.
  7. Wrong Implementation of Process – Which is why a lot of products and ingredients come with ‘Instructions to Use’. If an ingredient needs to be mixed and cooked, simply sprinkling it will not help.
  8. Poor Direction Scoping – This is where an intention and objective to start with, matters. There are billions of people, billions of problems and billions more opportunities. Which one or ones do you want to target. That’s what you pursue. Ignore everything else.
  9. Co-creation at the End of Process – all I’ll say is, phone sex doesn’t help create babies.
  10. Misconception of Approach to Creativity – This is true. Some people would tend to follow the design thinking process like it is a treasure map, when in fact, it is navigating your way through hostile jungle. Your senses need to be on alert all the time. Any input can change a lot of initial assumptions. That lions don’t climb trees. Or that chimps tend to rely on third party to help resolve disputes.
  11. Wishful Thinking for Culture of Innovation – Completely agree here. Which is why, a startup whose founders have the right values and give importance to innovation, can build it better into their culture, as opposed to trying to inject it into a global behemoth that has a century of history.
  12. The End Process is not the End – true – design teams, just like any other specialty teams, need to walk the talk. Leaving projects with solution advice that is abstract to clients, won’t serve anyone’s purpose. A lot of large consulting firms were infamous for doing this back in the day. Leaving clients many million dollars poorer, and with a big “report” that the client was clueless what to do with.
  13. Risk of Stagnancy – As Zig Ziglar said, “People often say that motivation doesn’t last. Well, neither does bathing – that’s why we recommend it daily.”

Thoughts?

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A Session on Innovation, Design Thinking & The Future of Work

A Session on Innovation, Design Thinking & The Future of Work

Earlier this week, I was invited to conduct a session around ‘Innovation, Design Thinking and the Future of Work’ at the Indian School of Management & Entrepreneurship, for a batch of about 170 grad students from Vaze College. The most enjoyable session I’ve had so far.

 

An ideation exercise I conducted, had the students thinking of ideas to replace the irreplaceable smartphone. And what innovative ideas they were!! Absolutely impressive! I barely heard 6-7 ideas for fear of running out of time. If only there was enough time to hear all the ideas.

 

 

The session started with about 4-5 students believing themselves to be creative and innovative. By the end of the session, over 80% of them believed they were innovative and creative. It was a truly humbling experience. With these brilliant folk entering professional life soon, the future looks promising!

 

 

While I’d really like to list out some of the ideas that the students came up with during the session, I’ll resist the temptation. In the hope that at least some of them would pursue their idea and make a world-transforming business out of it in the near future.

 

 

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Design Thinking – Shelters for the Homeless

Design Thinking – Shelters for the Homeless [3.5 minute read]

Here’s the next post, towards sharing stories and incidents around design thinking in daily lives, towards a better collective understanding. My earlier post was about taps at home, and why house helps might be wasting water. If you missed that, here’s the link.

Now, in developing India, as the nouveau riche buy vacation home after home after home, we are still home to an astronomical 18 lakh homeless (as of 2011)!

Now this post is not on wasteful spending, or on “prudent, realty investments” either. Actually on second thoughts, prudent realty related investments might be right at the centre of this one.

I had read about this story over 2 years ago, and was so fascinated with the design thinking connect, I’d shared it on Facebook. Thanks to Facebook’s random annual reminders, this one popped back up recently. It showcases a classic design thinking flaw, of thinking for the user, instead of simply observing and asking them.

New Delhi faces some really bitter winters. I’ve spent some time there on work over different winters, and on some of those nights, the cold was mind-numbing. So one can only try to imagine how tough it would be for Delhi’s homeless people. Right? Think again!

Some years ago, the state government in New Delhi, with good intentions for its homeless, built 218 shelters with a capacity exceeding 17,000 people! Impressive, right?

Now you probably imagine that as winters approach, these places must be getting mobbed with homeless folk rushing in to keep warm? Especially considering there are about 125,000 homeless people in Delhi.

To the contrary, even on the coldest of nights, apparently these places were sparsely occupied. As per government estimates back then, at its highest occupancy, there were only 8500 people at the shelters.

The homeless somehow preferred enduring the cold in the open, to these warm shelters. According to the statistics, for every person who huddled up in one of these shelters, about 15 remained in the open. The government even had cops spotting and taking any homeless to the shelters. But the homeless were like mischievous children, waiting for an opportunity to sneak out of this situation they didn’t like.

Does that even make sense? Who, in their right mind, would prefer to freeze outdoors, as opposed to being warm in?

Unless a bigger picture was missed out. About them and the lives they lived.

It turned out, the homeless were afraid of contracting fleas from other homeless folk packed into these shelters. Which in turn would make even their waking hours miserable. The shelters also didn’t have any storage areas for people to keep their few but priceless belongings safely. And the few belongings they probably had on them, were always at risk of being stolen at such places.

In total, a somewhat hostile place for them to stay in, even in the most unrelenting of winters.

In their empathetic and genuine concern for these people, the government somehow assumed many things about their lives, or conveniently skipped them out in light of the greater good they were doing for them. They forgot to actually involve the very people who would be using those facilities. To know what they could be like. To know if they’d missed out on some aspect. They too are, humans after all. Or if even that didn’t matter (as seldom does for our elected rot from across the country), at least to justify their investment in the project.

Some observation. Some asking. And then more of both, could’ve truly taken India a step closer to being a concerned and inclusive society.

You can read about it here: link

Would love your thoughts on it.

And if you’d like my to look at some complex business problem you’ve been grappling with, drop me a mail at shrutin[at]ateamstrategy[dot]in Hopefully, I’d be able to give you a fresh perspective in an effort to help you solve it.

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Vulnerability of Tech Processes and Human Decisions

Vulnerability of Tech Processes and Human Decisions
Here are two interesting incidents I came across online in the last week. One, about a seemingly harmless vulnerability in an online service’s process. The other, a possible vulnerability in human decisions in a human-dependent, traditional business.
First of, a French literary buff, conducted an interesting experiment. It was to check his hypothesis, that the standards of publishing have fallen significantly. Writer Serge Volle, took 50 pages of one of the novels of a Nobel laureate Claude Simon, and sent it to 19 French publishers as his original work. Interestingly, 12 of the publishers flatly rejected it. The others never replied.
While one could argue that publishers might have felt the content or style of this 1962 works, was not relevant for modern readers. However, one could also say that if these people can’t identify quality, how right are we to trust them with deciding if your works are good enough for readers or not.
You can read about the incident here: link
The other incident is even more amusing. An industry colleague of mine in the Design Thinking space shared this one on a group. A writer with an unusual name, Oobah (Butler), once upon a time, used to take small fees from local restaurants to write fake, glorifying reviews about them on TripAdvisor, even if he had never eaten at those restaurants.
And this seemingly huge chink in the TripAdvisor process, got him thinking if he could better himself. And he did. He decided to list his messy shed as a restaurant on TripAdvisor, and then made it London’s top-rated restaurant, without having served a single dish. How bloody cool is that?!
TripAdvisor folks later justified, saying their effort is largely channeled around eliminating fake reviews. Nobody in their right sense would create, or benefit from creating a restaurant that doesn’t exist. But it still is a gaping hole in the process.
Point being, as we continue to be wowed by the latest of apps that simplify our lives dramatically, teams at those companies need to be constantly aware of how their simple-to-use service can be abused.
You can read about the hilarious ‘Taking TripAdvisor on a Trip’ article here: link

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