Qualitative research and innovation

Qualitative research is not generally considered “real” research, and this has terrible implications for innovation. Companies’ thirst for operational effectiveness begs for quantitative data. But quantitative data does not and cannot form strategy. Qual data are a key ingredient to strategy, or the development of new and differentiated products.

Many people are familiar with Michael Porter’s famous paper, “What is strategy?”  Porter famously argued that many companies mistake operational effectiveness for corporate strategy. Operational effectiveness, according to Porter, is about quality, productivity, and speed. It is about doing the same thing as others, but doing it better.

Strategy, by contrast, is about being different. It is about doing entirely different activities to deliver value to customers. Other authors have called this the “blue ocean” or finding a place in the market that is calm, unoccupied, and yours for the taking.  A “red ocean” is full of competitors, doing exactly the same thing as you are, and demanding ever higher performance.

porter

Framed this way, it is clear that operational effectiveness relies heavily on quantitative data. How efficient are we? How do we stack up against the competition? How good are our products? How fast do we make them?

Operational effectiveness simply begs for quantitative data, and now that we have access to petabytes of passively collected data relating to productivity, quality, and speed, it is easier than ever to be operationally effective.

Or it should be. We know that quantitative data requires a great deal of cleaning, massaging, and managing, not to mention analysis, to make it useful for operational effectiveness.

The shift to data-driven operations has demanded a great deal of companies’ attention, mostly because data collection and analysis is not as easy as most think it to be.

But let us not mistake this for strategy.

There is nothing inherent to benchmarking performance that lends itself to strategic advantage. Quantitative data does not reveal how or in what ways customers are making their own workarounds. Quantitative data shows us how many products meet a particular standard, how many products are produced or sold, or how fast a company makes them. It can tell you the average satisfaction a customer may have, but it cannot reveal any of the detail behind that satisfaction.

In their insightful Harvard Business Review article, “An Anthropologist Walks Into A Bar,” Christian Madsbjerg and Mikkel Rasmussen argue that qualitative research gives companies the ability to bridge the “complexity gap,” or what a study of 1500 CEOs revealed as their main challenge. Why do customers do what they do? You must do qualitative research to find out. And, by extension, you must do qualitative research to innovate.

mads

 

Qualitative research is explicitly about revealing detail. Qualitative research shows how people are using products, or how these products sit and gather dust in the corner of the kitchen. Qualitative research, particularly field-based research like ethnography, offers that path to delivering truly different products.

Companies that do ethnography regularly uncover entirely new or different ways to deliver value to customers. Oftentimes, this is done unsystematically. Skillful product and brand managers know that observing everyday life can reveal the how and the why of product failure.

Nike is a great example of a company that is in touch with culture. Its marketers are largely acknowledged to be among the best in the world. Its product innovation is continual, and its brand equity is unparalleled. Even their lab-based researchers like the fabulously named Gordon Valiant are active members of the running community.  His lab-based practice is complemented by regular participation in running events, where he comes into contact with other runners.

Valiant conducts in-lab studies systematically, but observes human behavior in an ad hoc way. Imagine the advantage to companies that do this research systematically. Imagine having a steady stream of insight into real people and why they do what they do. Imagine having thick description of painful workaround work, and regular replenishment of unmet customer needs.

That can only come from systematic, regular, and rigorous qualitative research.

Compare that to a company tirelessly benchmarks its quality, productivity, and speed. The company with qualitative insight into human behavior will have almost limitless potential to do things differently, to deliver new products or services, to find entirely unexamined oceans of product innovations.

Yet we spend almost nothing on qualitative research.  Esomar, the international market research association, estimates that in 2013, corporations spent $6.6B USD on qualitative research, worldwide. The vast majority of money spent on qualitative research is on focus groups, but Esomar estimates almost $1.6B is spent on the more interpretive methods of in-depth interviewing and ethnography. This amount is dwarfed by the $32.4B USD spent on quantitative market research.

It could be argued that many companies need to start with operational effectiveness. Fair enough. But no company can survive on quality, productivity, and speed alone. It is too competitive a marketplace. Qualitative research, therefore, is a cheap way to guide the company toward different product offerings, and ultimately, toward innovation.

 

Microsoft’s Future Productivity Vision

At long last, I am able to share our work on the future of productivity. Video storytelling is a way of envisioning the future without the constraints of actually building all the prototypes. These conceptual prototypes cover a few important themes. Look for:

  • The end of the full-time job
  • Inter-generational care work, via distance
  • Online reputation management
  • Networked production of several enterprises and individuals
  • Just-in-time work spaces and places
  • Mobile productivity and seamless integration with traditional computing systems
  • Visualizing production through social network analysi

 

The Problem with Product Demos: An Analysis of Technology Demonstrations

There is a curious cultural practice in the high-technology industry: the product demo. The product demo is a must-have ritual for any organization who has developed and will hopefully sell a technology product. But the demo is a fiction that harms the product’s design, and worse, limits the company’s innovative potential.

Science Becomes Technology: From Knowledge to Control

The product demo is not a new phenomenon. Its roots can be traced back to our first interactions with technology in the 19th Century. Michael Faraday famously demonstrated the power of electricity at the Royal Institution in London, beginning in 1825, culminating in this famous lecture, “The Distinctive Properties of The Common Metals” in 1855. This particular lecture got some much needed star power with the attendance of the British Royal Family.

Faraday lecturing at the Royal Institution

Faraday’s lectures and others like them were designed to awe the audience. In the 19th Century, science and scientists were beginning to chip away at the religious world, and people like Faraday were there to pull back the curtain on God’s mysteries. The product demo has its roots in this concept of awe and triumph over the unknowable.

Demos Become A Show

By the end of the 19th Century, the inventor replaced the mere scientist as the hero of the times. Scientific discoveries alone were not celebrated, but the application of scientific knowledge. In other words, knowing about the natural world was no longer enough; controlling the natural world became far more important. The product demo became a demonstration not just of knowledge but of mastery.

Drunk History nails the absurdity of these demos with their hilarious recounting of Edison and Tesla’s feud over electricity (a must-watch if you haven’t seen it).


edison

  By this point, product demos changed. They were no longer lectures, but shows. The inventor was now expected to put on a show, complete with drama, climax and a “reveal.” The expectation of the demo is that there will be some moment (or perhaps many moments) that will surprise the audience. There will be a surprise and entertainment.

The Downsides of Demos

Once a demo becomes a show, it has all the downsides of a show. There is a front stage and a back stage. The front stage is a construction that could fall apart in any moment. We learned recently just how constructed Steve Jobs’ initial iPhone product demo was. Among other problems, the cell signal bars had to be hard-coded because the signal was not reliable enough. The product demo is a show about the technology; it is not about the technology’s actual use at all.

And this is the real problem with product demos: technology teams know full well they must put on a show. Instead of designing a much-needed solution, technology companies design “wow moments.” The Segway famously showed us that what tech nerds think is cool is painfully awkward for the rest of us to watch. Technology that may look good in product demos often has no place in everyday life.

Demos Are Not Real Life

For technology to really help us live better lives, it must fit into our everyday routines. It must alleviate burdensome experiences. It must improve our abilities in pleasant, non-distracting ways. The “calm technology” disappears when we don’t need it, and re-appears when we summon it. This is the direct opposite of demo technology, which is inherently dramatic, attention-getting, and the “star” of the show.

Collectively, we tend to focus — wrongly — on “breakthrough” technologies, such as the proverbial flying car. What we need now in this stage of our technological development is filling the gaps in our fragmented technological ecosystem. We do not need a flying car; we need better existing cars. We do not need a Holodeck; we need less email.

We don’t need this.

The next time you witness a product demo, imagine it is for a fix to your biggest technology frustration. Imagine it is a tool or practice to reduce email volume.  Would this be an amazing show? No. Would there be a dramatic unveiling? No. But this innovation would solve many of our daily frustrations and greatly improve our overall quality of life.  Unfortunately, the product demo is a practice that privileges breakthrough technologies. It is an expectation for startups to attract capital and user interest. It’s almost impossible to create an incremental innovative technology in this format.

 A World Without Product Demos

Imagine technology companies never did product demos. Startups would no longer be expected to create “shows” to attract funding. There would be no reason to have a “wow feature” that would make the audience gasp. The technology’s value would not be revealed in a moment, but come to be known through use over time. Imagine when after several weeks or months, the user base would grow and the value of the technology would be appreciated gradually. The Hype Cycle might disappear forever.

But most importantly, we may open the way for technology designers to finally solve real, everyday problems, instead of focusing on making a big splash. Breakthrough technologies would still capture the popular imagination, but the technology industry would have more room for the mundane, somewhat boring technology that might very much improve our lives.

 

 

How technology is like shipping containers

There once was a time when it was really difficult to ship goods from continent to continent. We collectively knew a lot about how to navigate the high seas, but we had no idea how to let many people ship many things. We had one system: buy the entire hull of the ship.

That began to change when we learned how to break down the hull of the ship into discrete units.

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The Birth of Modern Shipping

In 1956 a ship SS Ideal X set sail from Newark, New Jersey to Houston Texas. This ship was your average merchant ship except for an important modification. Instead of one big open cargo hull, the Ideal X was redesigned to accommodate shipping containers. When it arrived in Houston it unloaded 58 containers onto 58 separate trucks. This was the beginning of the modularity of international shipping.

Before this innovation, exporters faced a hodge-podge of standards to ship their goods. Locked shipping boxes had existed since the 1700s, but there was no standard size, so unloading the boxes changed at every port. Exporters could opt to put their goods on simple palettes, which they often did. But shipping companies had no way of knowing to optimize their space inside their hulls. They too faced a hodge podge of sizes making shipping expensive and difficult for everyone.

That all changed with the Ideal X. Shippers could now reliably predict how much space they could sell, and exporters could count on a standard unloading procedure. Prices fell and cargoes increased. Overall intersea traffic went up and trade increased. Ships’ hulls were no longer treated as whole spaces, but rather as a function of shipping containers. International shipping was fundamentally changed.

Shipping containers broke down cargo space into predictable, interchangeable, and flexible space. As such it solved a lot of problems.

The Birth of Modern Technology: The Open API

Technologies that allow other technologies to improve or combine are themselves innovations, ones that typically fly under the radar. The open API is one such innovation. It allows applications to talk to other applications, but unlike other standards before it, the API became readily available for others outside the organization to see. Open APIs are the embodiment of what Rainie and Wellman call the “new social operating system” of the networked society. Where once, internal organizations guarded their information carefully, now many people consider it normal and even proper to share information with others.

This is one of the norms “Secrets of Silicon Valley” one author found in the Bay Area. As a transplant from Washington DC, she found herself surprised at how open people appeared to be to meeting with her.

Note that I say “appeared” to be; openness is still not one of Silicon Valley’s virtues. Apple, for example, is notorious for its secrecy. But the norm of sharing means that people will be overtly open, demonstrating their compliance with this cultural expectation. That doesn’t mean they don’t keep secrets. It means that they are secretive about keeping secrets, and overt about sharing information.

The open API is a technology that allows combinations of existing technologies, which in turn creates entirely new technologies. Take, for example, the If This Then That tool, which allows users to create technological “recipes.” Send me a text if I get a retweet. Send me an email if my mom’s Facebook gets updated. Tell me something about something else — in the precise way I want it.

This is just like a shipping container. It breaks down a large technology, like Twitter, and takes a slice of its value and delivers it to you in the way you would like. You don’t have to buy the entire Twitter stream or the entire ship — you can take only the part you want and have it delivered safely and predictably in the way you specify.

The open API allows technologies, which were once “group” technologies, to become truly “networked” technologies.