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How to Achieve Resilience through an Outcome Focus

How to Achieve Resilience through an Outcome Focus

Strategic Resilience

Remember Daily Planners? 30 years ago, managers and executives all had one. Leather-bound folders, they contained contact lists, to-do lists, a diary, handy information and planning tools. Suppliers ran courses on how to use them effectively. These suppliers thrived. People loved their daily planners. But if you lost your folder, you lost everything. It was a disaster!

And then along came the Palm company with its PalmPilot – a handheld device that carried the same information as daily planners. And the information could be backed up. Hallelujah! If you lost your handheld device you didn’t lose everything (as long as you’d done a back-up). Mobile phones evolved and were able to carry the same information as the PalmPilot. The Palm company also entered the mobile phone market. The Palm company and other mobile device providers thrived.

And then the BlackBerry arrived. Blackberries offered everything the mobile phones did but they added push email. Now business people could check email anytime, anywhere. Blackberry thrived.

And then Apple introduced the iPhone. The iPhone offered everything BlackBerry did, but they added a personal element – your own music, access to social media and thousands of apps. The iPhone (and a year later Google’s Android) demolished the market for BlackBerry. Now, Apple thrives.

The fall of the Palm company and BlackBerry (Research in Motion) was spectacular. They were riding high with seemingly bright futures. Which made the speed of their crash all the more shocking.

Customer Outcomes

Is there a frame of reference to make sense of this pattern of growth, disruption and collapse? Let’s use customer outcomes to explain what happened.

Whenever a person or organization buys a product or service, there’s an outcome they want to achieve. It might be solving a problem. It might be achieving a desirable new to-be state. Even if the customer can’t articulate the outcome clearly, it’s still there. Companies thrive by enabling an outcome customers want.

Disruption Type 1 – Add-on Outcome

Daily Planners, Palm and Blackberry all did a great job of delivering outcomes for their customers. Yet all were disrupted. Let’s explain that disruption by considering the outcome enabled by each.

Daily planners allowed managers to be organised, to manage time effectively and have most of the personal productivity information they needed in one place. The outcome could be described as ‘business information organised’.

The Palm company extended this outcome. Their outcome could be ‘business information organised and secure’.

Then BlackBerry offered an even better outcome. Their device not only kept business information and allowed phone calls. Now you could get your email. For business people, they were fully connected at all times. The outcome BlackBerry enabled was ‘business connected’.

Apple went one better. The addition of all the personal items extended the outcome to ‘business and personal connected’.

In each case the disruptor matched the previous outcome then added new elements that customers loved. The approach of taking an existing customer outcome and adding something significant is one of three disruption methods. This first one is called creating an add-on outcome.

Disruption Type 2 – New Delivery

The second method for disrupting a market is known as new-delivery. It involves delivering or enabling an existing outcome in a new way.

On 1 July 1979, Sony introduced the world to the Walkman. Using cassette tapes, the Walkman allowed people to make their music portable. It changed the recording industry and the way people listen to music. Phenomenally successful, Sony sold over 200 million units. Sony subsequently released a CD-based version. The customer outcome enabled by the Walkman was ‘music made portable’.

The second method for disrupting a market is known as new-delivery. It involves delivering or enabling an existing outcome in a new way.

On 1 July 1979, Sony introduced the world to the Walkman. Using cassette tapes, the Walkman allowed people to make their music portable. It changed the recording industry and the way people listen to music. Phenomenally successful, Sony sold over 200 million units. Sony subsequently released a CD-based version. The customer outcome enabled by the Walkman was ‘music made portable’.

Disruption Type 3 – New Outcome

Using the lens of customer outcomes, the third disruption method is to create an entirely new outcome. The introduction of social media platforms provides an example. While the early versions had different flavours, the customer outcome they served was consistent – ‘people connected online’.

Another example is the Sony Walkman. ‘Music made portable’ was an entirely new customer outcome.

Strategic Resilience

Let’s define strategic resilience as medium to long-term prospering. To prosper over time, a business must do one of two things. The first option is to serve an enduring customer outcome – an outcome that customers will want for a long time. At the turn of last century, a buggy whip manufacturer may have defined their customer outcome as ‘motivated horses’. And even if that was a great description of the outcome they served, Henry Ford was about to ensure they didn’t have strategic resilience. The second option for long-term prospering is to evolve or change the outcome served. Both creating an add-on outcome or a completely new outcome deliver this result.

Tactical Resilience

If strategic resilience comes from choosing the right customer outcome, tactical resilience can be considered enabling that outcome in the most effective way possible. And being able to adape quickly. We’ve already seen that businesses can be disrupted if a competitor introduces a new delivery method. But improved delivery isn’t always as disruptive as the effect of MP3 players and then the iPod on Sony Walkmans.

Business also drive improvements in delivery through continuous improvement. Small incremental changes add up over time. Businesses that aren’t constantly improving how they enable the customer outcome slip behind.

Most businesses look for improvement in how they deliver. There’s no shortage of ideas. The customer outcome is a great way to prioritise those ideas. The ideas that have the biggest impact on enabling the customer outcome should have the highest priority. Of course, this needs to be tempered by considerations such as cost, degree of difficulty and time to implement.

Tactical resilience requires vigilance. The business must constantly be monitoring developments in delivery. No business wants to be the one disrupted by a new delivery method they didn’t see coming.

Operational Resilience

Operational resilience is about the business dealing with the day-to-day bumps along the road. Things will always go wrong. There’ll always be problems to solve. The resilient business establishes a method of work that solves these problems at the lowest level possible in the organisation.

Outcomes can again play a part. But this time the outcome focus is internal. The aim of the organisation is to enable the customer outcome. To do that, there are a series of internal outcomes that must be delivered so that the customer outcome can be enabled. For most organisations there are only 6 to 10 of these key internal outcomes. We call these internal outcomes ‘execution outcomes’.

Execution outcomes form a chain. Each execution outcome must be achieved to make the chain whole, which then enables the success outcome. The key is that all staff support at least one execution outcome. They’re all clear about the result of the work they do. Of course, the organisation has processes and in normal circumstances the staff follow these processes. But sometimes things occur that aren’t envisaged by the standard processes. In non-resilient organisations, work stops and resolution is passed up the management chain. In resilient organisations, clarity about the execution outcome provides context for making decisions at lower levels. Problems are overcome faster. And the corrective action is more likely to be correct as everyone is focused on achieving the execution outcome.

Operational resilience requires the organisation to be agile. It needs to be able to adapt quickly. Execution outcomes allow swift corrective action at lower levels in the organisation.

Outcomes and Resilience

We’ve looked at three different types of resilience. Strategic resilience involves serving the right customer outcome. The customer outcome may itself be enduring. All the company can adapt their customer outcome over time. Clarity on the success outcome enhances long-term resilience of the business.

Second, we considered tactical resilience. The ability to enable the success outcome in the most effective way. And the ability to adapt and improve the delivery. Success outcomes help businesses focused on what’s needed by the customer and on improving delivery over time.

Finally, we looked at operational resilience. The use of execution outcomes to ride clarity to all staff about the outcomes produced by their work. This provides context for making decisions for dealing with problems or challenges speedily and at the lowest level possible in the organisation. This helps drive operational resilience.

The use of outcomes provides a simple but effective manner of planning for and achieving organisational resilience.

Next Steps

For strategic resilience

  • define the customer outcome you serve
  • decide whether this outcome has longevity
  • if it doesn’t consider what changes you need to make

For tactical resilience

  • consider how well your current products and services enable the customer outcome
  • identify gaps and decide if you want to bridge those gaps
  • identify any part of your offering that doesn’t fit and may not be needed
  • consider things the customer must do themselves to achieve the success outcome. Decide whether you want to do those things as a way of increasing revenue

For operational resilience

  • analyse how well staff understand the outcomes to which they contribute
  • analyse at what level in the organization decisions on problem-fixes need to be made, and how long it takes
  • if you’re dissatisfied with what your analysis shows, consider using execution outcomes to drive your operations

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 pjh@outcomeleaders.com

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The founder, Paul Henderson, spent 15 years leading the Asia Pacific region of an enterprise software company. He saw the potential that could come from delivering real and measurable business success for customers. So he initiated a customer success program based on customer outcomes. He and his colleagues developed, modified and proved the model over more than five years.He’s writing his second book: The Outcome Generation –How A New Generation of Technology Vendors Thrive Through True Customer Success. He published his first book in 2016: The Chief Capability Officer – Delivering the Capability to Execute.

2018-08-22T03:58:14+00:00