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.
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.
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 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.