Co-creation & rapid prototyping of services Content

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1 Risto Gyldén, ABB Oy Marine Services, Co-creation and rapid prototyping in service product development June 1, 2012 Slide 1 Co-creation & rapid prototyping of services Content Risto Gyldén Naval Architect, M.Sc. (Aalto University) Senior Azipod Specialist 1) Introducing ABB Group and ABB Marine 2) Co-creation and rapid prototyping in service product development Experiences from ABB Marine June 1, 2012 Slide 2 1

2 Risto Gyldén, ABB Oy Marine Services, Introducing ABB ABB Group June 1, 2012 Slide 3 ABB s vision Power and productivity for a better world As one of the world s leading engineering companies, we help our customers to use electrical power efficiently, to increase industrial productivity and to lower environmental impact in a sustainable way. June 1, 2012 Slide 4 2

3 A global leader in power and automation technologies Leading market positions in main businesses 135,000 employees in about 100 countries $38 billion in revenue (2011) Formed in 1988 merger of Swiss and Swedish engineering companies Predecessors founded in 1883 and 1891 Publicly owned company with head office in Switzerland June 1, 2012 Slide 5 Power and automation are all around us You will find ABB technology orbiting the earth and working beneath it, crossing oceans and on the sea bed, in the fields that grow our crops and packing the food we eat, on the trains we ride and in the facilities that process our water, in the plants that generate our power and in our homes, offices and factories. June 1, 2012 Slide 6 3

4 Risto Gyldén, ABB Oy Marine Services, Introducing ABB ABB Marine and Cranes June 1, 2012 Slide 7 Moving people and goods safely and efficiently You will find ABB marine solutions New regulations New technology Major changes over vessel life time opening new seaways between Europe and Asia Key business drivers: Energy efficiency Safety and environmental sustainability Safe offshore oil and gas exploration Global increase in container transportation powering efficiently world s largest cruise ships propelling LNG-carriers into new era of energy efficiency on more than 125 offshore drilling platforms June 1, 2012 Slide 8 4

5 Global Marine Services network Securing availability 19 Marine Services Centers (MSC) 15 Crane Service Centers (CSC) ABB Marine and Crane Service Center June 1, 2012 Slide 9 Risto Gyldén, ABB Oy Marine Services, Co-creation and rapid prototyping in service development Experiences from ABB Marine June 1, 2012 Slide 10 5

6 Co-creation and rapid prototyping Presentation structure First: Co-creation and rapid prototyping in service product development Experiences from ABB Marine Second Development of new, high-end training service products DEC20/30 June 1, 2012 Slide 11 Co-creation and rapid prototyping in service development Experiences from ABB Marine 6

7 Service product development Challenges of an industrial corporation Service is actualized in the mind of the receiver This presentation is about the challenges of an industrial corporation in its service product development Same challenges can be identified in most service development processes It s NOT a question of size of the company (Industrial) services happens between people in most cases June 1, 2012 Slide 13 Customer process understanding ABB s approach ABB is traditionally an equipment supplier Assertiveness: Boldly self-assured Aggressively confident Cocky With equipment related services Less emphasis on customer processes and systems Swiss Swedish Finnish corporate culture Assertiveness is a risk How to be humble? Approaching customer hat in hand Maritime business value chain is complex ABB Marine => Ship yard => Ship owner => End customer => End user Understanding value creation? June 1, 2012 Slide 14 7

8 ABB s traditional product development process Stage-Gate -model Gate 0: Agreement to start Gate 1: Agreement on scope Gate 2: Agreement on start project execution ABB has strong R&D Long tradition in organizing product development projects Gate 3: Confirm Execution Gate 4: Agreement on readiness for introduction Gate 5: Release / Handover Gate 6: Close Project Gate 7: Capture return on investment Standard corporate model is STAGE-GATE Linear process Strict GO/KILL-decisions No feed-back loop G0 G1 G2 G3 G4 G5 G6 G7 Agreement to start Agreement on scope Agreement on start project execution Confirm execution Agreement on readiness for introduction Release / Handover Close project Capture return on investment June 1, 2012 Slide 15 ABB s Product development process Traditional Stage-Gate -model Stage-gate model suits Tangible, capital goods development With significant financial risks Missing: Listening Understanding, i.e. dialogue Service product development is different Less financial risk, less resources Requires communication with customer June 1, 2012 Slide 16 8

9 Service product development Internal challenges Reasons to create new services? Business case based on customer needs Top management approval Get a sponsor Internal sales Resistance, change management Sponsor s responsibility June 1, 2012 Slide 17 Co-creative process Gathering data with qualitative methods Find out and define customers needs NOTE: Not the same as wants or requests Engage customers in open discussion Involve customer s top experts Open questions reveal competence gaps Customer s and own Open exchange of views builds trust Bonus: Use trust to increase market knowledge June 1, 2012 Slide 18 9

10 Co-creative process Rapid prototyping Analyze customer data Utilize all available own, internal corporate knowledge and skills Both substance and business Use third party resources when needed Come up with best practical solution Promise only what you can deliver Present to customers in a structured, realistic manner Get feedback June 1, 2012 Slide 19 Co-creative process Auditing by customers This is important! Let your customers audit your new product i.e. reveal to a certain extent what is being developed Let customer s experts evaluate your proposition This may be the key to trust and success Be humble Be honest June 1, 2012 Slide 20 10

11 Co-creative process Piloting after auditing Publish first version without delays No service without purchase order This is also important! i.e. piloting for a price Financial input from customers ensures commitment June 1, 2012 Slide 21 Value assessment Measuring service value Internally Usually quantitative KPIs Revenue, GM, EBIT Externally i.e. customer value proposition In optimized processes quantitative KPIs difficult Use qualitative KPIs? Change in customer behavior June 1, 2012 Slide 22 11

12 SUMMARY Co-creation and rapid prototyping SUMMARY Identify initial business case Ensure management support Engage customer in open discussion Involve all resources in development Do not promise more than you can deliver Early demo and feedback Piloting for money, i.e. no service without PO Customer value measurement by qualitative KPIs June 1, 2012 Slide 23 12