What would we do if we were given the keys to approach any industry and give them the Business Agility treatment? Which industry would we go with?
Discussing this during our recent Podcast episode, it prompted the issue of opposing or competing customers within a business. The particular example I used was in sport.
Applying Business Agility to the sport industry
Supercars just had a weekend of racing that many people reflected on as a shift in priority towards entertainment over the traditions of sport, much to the benefit of the fans. I keep thinking back to my time working there and if I’d known then, what I know now, my approach may have been very different.
Firstly, I’d be considering more of a Customer Seat At The Table perspective. Who is our customer and what do they value most? While I was working there, I always thought of myself as a fan, and therefore I knew what our customers wanted.
That was my first mistake by assuming that my own views were aligned with the views of the majority of our customers. I may have been a fan, all the same though, was I representative of most fans? Unlikely. That view alone also takes us to another issue. The assumption is that the fans are the only customer, and therefore not taking into consideration the sponsors and advertisers, let alone broadcast rights holders.
The revenue generated in each of these three categories is just as critical as each other to the success of the business. One cannot be prioritised over the other. Well, depending on which stakeholder you’re talking to at the time of course!
It is easy to default prioritising the customer who brings in the biggest bulky number to your revenue line every quarter, nevertheless, in this instance, even that customer has a reliance on the fanbase.
Approaching this now with a Business Agility mindset, my decisions would not be orientated around which customer persona draws the most revenue. Instead, my decision would be to understand the value that each customer persona is wanting from you. If their values conflict with one another, how do you handle it?
Firstly, identify your customers
One way to identify what your customers want is to use research to group similar demographics together and build personas. Personas are fictional characters created to represent a customer group. Once you have a persona, you can then flesh-out their wants and needs more accurately.
In the sporting context though, this can be difficult to do because you have three main customers or personas; broadcasters, ticket-holders and advertisers. Each of these have conflicting interests. The advertisers want something the ticket-holders do not necessarily want to give them. Time.
Side note, make sure you’re not just identifying the customers and creating personas, ensure that everyone in the business knows them and utilizing them when prioritising and making decisions. We’ll come back to that one shortly.
Identifying the Conflict
The first point of call is to understand where the conflict is and how that conflict impacts the business.
In our sports example, the value for a fan is entertainment and ultimately the value they takeaway is the time exposed and the level of entertainment provided.
For our broadcaster, their value is the exposure of advertising to the fan, which is where the conflict arises. You need to interrupt the entertainment to provide the advertisement from the broadcaster’s customer. Remembering that every purchase is a sale, understanding our customer’s customers is critical to success here as well.
Fans are giving their time in exchange for entertainment and advertisers want some of that time to talk to the fans. The conflict is in the interruption.
Ice Hockey is taking an approach that puts a higher value on the broadcast where the periods are stopped and started based on when TV ads are being broadcasted. Perfect for broadcasters, but if you are in the stadium, this is not an optimal experience.
The opposite happens in AFL broadcasting, where a TV ad will go live during a break in play. A compromise, but this approach still breaks the tension in the drama that sport provides and is, therefore, compromising the overall experience for the fan. There’s nothing worse than getting all excited about your favourite team’s goal and then you have to break that to find out the current price of printer cartridges.
How do you keep conflicting personas happy?
Once you have competing customer persona’s, you are always going to have to compromise. Taking a more calculated approach is essential.
Now that we have identified the conflict, along with understanding the value our customers are drawing from it, we can look at creative ways to navigate the conflict. We may not solve it entirely, we can, however, mitigate risk by identifying and surfacing it to our customer seat at the table perspective when we iterate.
We can also define a Business Value formula that includes the metrics we need to consider in prioritising the work, more on that later.
In order to return value to our broadcasters, we need to expose advertised products or services to the fanbase. If we are delivering it in an entertaining way, that does not break the momentum of tension or drama, then we are mitigating the loss of value to the fan.
Many sports are starting to head down the path of providing more magazine-style programs that are brimming with product placement. Viewers are still entertained, and the advertisers are showing their products without a heavy interruption. However, there is still a compromise that now sits with the advertiser rather than the fan. The product may not be shown in a way that is perfectly aligned to the advertisers brand. However, If the advertiser truly understands the entertainment value to the fan, then this should be a compromise they’re willing to accept, or even embrace.
There are many other ways that this approach could work, but it is ultimately down to creative control and transparency between customer personas. When a creative team is empowered to break the mould, come up with new ideas, and are armed with metrics and well-defined personas, you have the greatest potential to satisfy all customers at once.
Understand the business value and calculated compromise
Speaking of metrics, defining a Business Value Model in conjunction with Weighted Shortest Job First (WSJF) is a really effective way to use data to make decisions and ensure you are doing the most valuable work.
Running a Business Value Mapping exercise will allow the team to surface and visualise metrics aside from revenue that should be considered as progress for the business. Voice of the Customer metrics such as NPS score, mean you can track progress to ensure changes to the business and products align with each customer’s true value.
This way, when you know that you need to make a compromise, you can make one that is calculated to mitigate risk as much as possible.
While we’ve talked here mostly about the conflict between different customer types, there’s also the customer personas within the same customer category that have conflicting views and desires. Sport is always being challenged to keep things fresh and interesting while attempting to maintain its traditions.
The traditionalist, who is often opposed to changes, is then competing against the desire to attract new fringe customers through the evolution of the sport while it tries to remain relevant to new audiences. Without adaptation and evolution, you are risking a deteriorating fanbase.
Any business needs to be able to navigate the challenges faced to appeal to both it’s existing customers while continuing to attract new customers.
A good Product Owner will seek to understand the common ground between these two customers and attempt to adapt the product to appeal to both. Sometimes, there may even be a need to adapt the messaging and change management to help customers see the value, even when it may on the surface seem opposed to their perspective.
To deal with competing customers, understand where they align and where they compete, then adapt your process to ensure you’re highlighting conflict and able to prioritise items that add value in places that compliment where customers align.
Whether you have competing customers or not, the important thing is that you genuinely understand who your customer is and their desires for your product. Customer Personas are a great tool, though it is just one way to get to know your customer. There are many others, and sometimes it is just as simple as finding them and having a chat.
Check out our Product Owner eBook to see if you are considering all aspects of Product Ownership.
This is just one industry and one pillar (Customer Seat At The Table) of Business Agility which we have looked at. But what other industries are worth the Business Agility treatment? And what other pillars could you apply?
Hear the other industries we discussed with a Business Agility lens in our podcast below. If you have a suggested industry for us to chat about on our next episode, let us know at firstname.lastname@example.org.