As in previous chapters, we choose a setting to illustrate key lessons. Our focus here is on home automation and the connected house. In three separate scenarios, Bill, Kayla, and Aruna are characters arriving at home in the evening, making themselves comfortable, and preparing dinner.
Bill is a college professor. He stops for groceries on the way home. On arrival, he puts his four bags down in front of the locked door, fumbles for his keys, and unlocks the door. The temperature in the house is on the cold side—the air conditioner has been running all day because Bill forgot to adjust it when he left that morning. Ignoring the granola crumbs on the floor, he walks to the coffee machine and turns it on, only to remember that he was out of coffee and forgot to put it on his grocery list. It will have to be tea today. While boiling the water, he catches the end of an NPR story he started listening to in the car—too bad he missed the middle part. Then he sits down on his couch with his tea. Afterward, he gives the floor a quick once-over with the vacuum.
Now consider Kayla, a high school senior living at home. As Kayla arrives, her mother opens the door and welcomes her. Mom, who came home from work an hour ago, has created a perfectly homey ambience for Kayla: the floor is clean, the air conditioner is set to seventy-three degrees, and the smell of fresh coffee is in the air. Mom went grocery shopping on her commute home, so the fridge and pantry are fully stocked, even though Kayla and her friends depleted the snacks while watching movies the night before. From the restocked fridge, Kayla grabs a diet soda and sits down in front of the television to watch her favorite sitcom while waiting for Mom to complete dinner. (Just for the record, Kayla’s dad might equally have done the shopping, cooking and cleaning, and we pause here to salute everyone who runs a home with children in it.)
Finally, consider Aruna, a tech executive. As she arrives home, her front door unlocks without her touching it, opening promptly based on a sensor in the door recognizing her identity. She enters the house and is happy to see that the vacuum robot, Roomba, has completed its job. The temperature is set at a comfortable seventy-five degrees, thanks to the preprogrammed Nest thermostat. Aruna shouts out, “Alexa, turn on the coffee machine,” then heads over to the pantry, which is fully stocked thanks to Amazon’s home delivery services. Aruna grabs a drink and sits down. Like Bill, she had been listening to something in the car. In her case, it was a podcast, and it restarts exactly where she had left off.
We hope that at least at some point in your life you have been spoiled by a parent, friend, or spouse, just like Kayla. We assume that you are old enough to remember air conditioners controlled by a gray box on the wall and that you have done the chores of managing a household, including vacuuming and grocery shopping. And we assume you have at least heard of the products present in Aruna’s household: iRobot’s Roomba, Amazon’s Alexa, Google’s Nest thermostat, and the smart home security system that detects who is at the door.
Here is a preview of how we will use the three user experiences in the remainder of this chapter:
Just like other connected customer relationships, the connected home user experience comprises many individual pieces. Alexa, Nest, and Roomba perform specific functions, like making coffee, regulating the temperature, and vacuuming. Technologies to clean the floor include automated vacuum machines (Roomba), traditional vacuum machines, and somebody with a mop and broom. In the second section of this chapter, we talk about how to deconstruct a connected strategy into a set of functions that each represents a job to be done.
Once we know what functions the technology should perform, we can think about the technical means to accomplish them. But, as we go into the implementation, as managers we always should remember that users derive value from what a device does, not from its underlying technology. In the third section, we will describe the concept of a technology stack, with the functions as the user sees them on top of the stack and the technical details at the bottom.
Implementing a function to support a connected customer relationship has many design options. The brewing of coffee can be triggered by voice activation via Alexa, through an app on our phone, by sensing our proximity to our home, or through a traditional on/off switch. We should explore many alternatives and get inspired by solutions from other industries. In the fourth section, we will discuss the classification tree as a powerful tool to explore design options and selection tables to help us choose between them.
Ten years ago, Aruna’s scenario would have sounded futuristic. At that time, very few people could afford such whiz-bang technology for home use; today this scenario (or at least parts of it) is widely attainable. The change has been wrought by improvements in technology that provide more functionality at lower cost. As we discuss in the fifth section, advancements deep down the technology stack bubble up and enable new connected relationships that were previously impossible or prohibitively expensive.
Deconstruction: Breaking Down a Connected Strategy into a Set of Functions
Technologies do not have value per se; users derive value from the technology performing a specific function. We can think of a function as the purpose of the technology. The purpose of the technology answers the what question (what does the technology do?). In our example, Kayla does not care whether it is a smart door with face recognition and an automatic lock that lets her in or her mother who does it. In the same way, the cleanliness of the house is what matters, whether achieved through Roomba or a member of the household with a broom or vacuum cleaner.
Once we are clear about the what, we can turn our attention to the how (how does the technology work?). Functions are performed by devices, pieces of software, or people following a workflow. Sometimes the functions are performed by the customer themselves, as was the case when Bill did his own grocery shopping and virtually everything else in his scenario.
The first thing you should do when exposed to a set of technology buzzwords in the context of connected technology is to forget about the how and focus on the what. In any connected relationship, there are many whats, so we need to focus on something more specific. We focus by deconstructing the connected strategy into a set of required subfunctions. Deconstructing a problem means breaking it up into smaller, manageable subproblems and solving those first.
We find it helpful to deconstruct a connected strategy based on two dimensions. The first dimension captures all the functions that need to be carried out within the two building blocks of a connected strategy: the connected customer relationship and the connected delivery model. In this first dimension, as we saw in chapters 4 and 5, the connected customer relationship consists of four pieces:
Recognize concerns becoming aware of the need in the first place.
Request includes the search and decision-making process, the placement of the order, and the processing of the payment.
Respond captures those functions required so that the customer can receive the product or service, experience it, and be connected to any form of after-sales support.
Repeat encapsulates all the functions that allow the firm to learn continually from the repeated interactions it has with its customers.
Within the connected delivery model, as described in chapters 7 and 8, we need the following:
The functions required to establish and support the connection architecture, which means the connections among the firm and its suppliers and ecosystem. For example, this could be a link to a supplier for a connected retailer or a reputation scoring of an individual within a peer-to-peer network.
The functions required to establish and support the chosen revenue model. This could include measuring use time, assessing the performance of the product, or transmitting data to other ecosystem members.
The second dimension of deconstruction takes each function, such as identifying a person, making a payment, or shipping a good, and breaks it up further into four types of subfunctions: sensing, transmitting, analyzing, and reacting.
Why those four? To illustrate, let’s return to our connected home sce
nario, this time focusing on the thermostat. To avoid excessive air conditioning, which is both uncomfortable and wasteful, four functions need to be completed. The current temperature needs to be sensed, it needs to be transmitted from the sensor to a decision-making unit, that unit analyzes the information and makes a decision, and then somebody or some device needs to react by executing the decision. This creates a feedback loop common to all connected technologies: sense-transmit-analyze-react, with the acronym STAR.
We can now combine the two dimensions into a table, as is shown in table 9-1. The columns capture the different elements of the connected strategy: recognize, request, respond, and repeat, plus the connection architecture and revenue model. The rows capture the four dimensions of STAR: sense, transmit, analyze, and react. We can use the table to catalog the many subfunctions needed to create a connected strategy, as table 9-1 shows for Aruna’s coffee consumption.
Consider the first column, recognize. One subtask is to sense that Aruna has only twenty grams of coffee left. This quantity information then has to be transmitted to a cloud or edge computer (a computing device sitting close to the information source). There it must be analyzed to answer the question whether the amount left is less than the desired minimum quantity of fifty grams. Lastly, the system must react and start the request module (next column) to reorder the coffee.
Or consider the last column, revenue model. Assume the coffeemaker didn’t charge Aruna up front for the machine but charges her a daily fee that includes a guarantee that the machine will have an uptime of 100 percent. To implement this revenue model, it is imperative to sense the maintenance needs of the coffeemaker on a continuous basis. This status information must be transmitted to the coffee machine’s service provider. This information is then analyzed and a decision made about when to replace the machine. And lastly, the firm must react and ship a replacement machine once the old one shows signs of wear.
As we have shown in table 9-1, each function of a connected strategy can be broken down into further subfunctions using the STAR approach. At the end of this deconstruction, you have a set of very specific subfunctions. Each subfunction, in turn, corresponds to an engineering problem. In other words, you have a job to be done and now can look at available technologies to perform it effectively. (For another example of the STAR approach, see the sidebar.)
Functions Are Performed by a Technology Stack
Returning to Aruna’s connected home, let’s look at what needs to be in place for the door to open conveniently on her arrival. We need a camera at her door, transmission technology to send the video stream, and a computing device that takes the incoming data and sends a signal to a locking mechanism that opens the door or keeps it shut. We can identify people by capturing their biometrics (facial images, fingerprints, eye scans), by having them enter a user ID and password, or by sensing the proximity of a device such as a key or a phone. If we drill down on face recognition, options include 2-D and 3-D image processing. Within 3-D image processing, we can further distinguish methods of face recognition that rely on unsupervised deep learning methodologies using neural networks and other methods that work based on the predefined geometric patterns of faces.
Chances are that you are not that interested in the nuts and bolts of unsupervised deep learning methodologies using neural networks. You just want Aruna’s door to open when she arrives but remain closed to everyone else. To delineate the underlying technologies, their functioning, and the business services they perform, it is helpful to think of technologies in the form of a stack consisting of hierarchical layers.
APPLYING THE STAR APPROACH TO A SCHIZOPHRENIA DRUG
As briefly noted in chapter 8, in 2017 the FDA approved the first drug to be paired with a digital ingestion-tracking system aimed at improving patient adherence with taking medications. Medication adherence is a major challenge for some schizophrenia patients, as well as for those suffering from other conditions. The system senses when the pill is swallowed and then transmits the data. The drug Abilify is part of a drug-device combination branded as Abilify MyCite.
Consider the recognize dimension that is involved in the connected strategy of Abilify MyCite using the STAR approach discussed in this chapter:
Sense: Embedded in each pill is a sensor (known as an ingestible event marker), which is the size of a grain of sand. The sensor reacts when it reaches fluids in the digestive system.
Transmit: The ingestible event marker transmits a signal to a patch worn by the patient, which in turn is transmitted to the patient’s phone, and from there to a cloud-based server.
Analyze: The company’s software compares the events associated with medication intake to a medication regimen established by the care team.
React: In case of a significant discrepancy, the next step of the connected strategy—request—is triggered, alerting the patient, family, or care team to take corrective action.
The most technical layers are at the bottom of the stack. For instance, the lowest level might be about the physical transmission of bits from one device to another. At this layer, you are talking about volts or frequency and worry about signal strength or network topology. The next layer up in the stack takes these capabilities as given. You know that bits somehow will get from one device to the other, so you can turn your attention to creating connections, which might involve establishing and ending connections between two devices through a protocol. The next layer might be concerned with sending data packages through a network using sender and receiver addresses, and so on. At the top of the stack is the application layer, which is closest to the end user.
The beauty of any stack model is that the user can ignore the lower layers in the stack, just as you can drive a car without knowing how a combustion engine works. Stacks create clear interfaces and layers of abstraction. As somebody building connected strategies, you can decide for yourself how deep down into the stack you want or need to go.
The collaboration between Steve Jobs and Steve Wozniak illustrates how much you need to know about the lower layers of the technology stack (and how far you can advance in your career by excelling at the top layers). In the early days of Apple, Jobs was the visionary imagining user experiences. He was primarily concerned about the higher layers in the stack, while Wozniak was the engineer who made it happen, which required him to dive into all the technical details lower in the stack. The focus on the user experience and the willingness to abstract from engineering details at lower levels stayed with Jobs throughout his career, including through the development of iconic products such as the iPod, the iPhone, and the iPad. Don’t get us wrong: to make a connected strategy happen, somebody has to go deep down into the technology stack, but that somebody might not have to be you.
Functions Can Be Carried Out by Alternative Technologies
As you go down the stack, moving from user experience into technical details, you have design options. There almost always exists a set of alternatives to implement a function. Because this is not an engineering book, our focus is on the application level of the stack (“How can we recognize a person?”), though the logic applies to any level (“How can I transfer ten megabits per second over a distance of five meters?”).
Let’s look at a subfunction from table 9-1 and think about alternatives for implementing this function. Again, let’s pick the subfunction “identify a person” and systematically explore our design options. A great tool to advance that exploration is the classification tree in figure 9-1.
A classification tree takes the space of all possible solutions and breaks them up into different categories. When it comes to recognizing a person, we can, at the highest level, distinguish between human solutions (a doorman or Kayla’s mother) and automated solutions. Automated solutions can be further broken up into those that require user action and those that don’t. And so on …
The classification tree helps you be systematic in your exploration of technological options and your discussions with e
ngineers.
To populate the classification tree, we find it helpful not only to generate alternatives internally but also to look at how a subfunction is performed by other firms, especially firms outside your own industry. Consider the following example: While writing this book, one of our friends had a BMW that required maintenance. When the maintenance was completed, she was called by the BMW dealership and notified that the car was ready for pickup. She took a cab to the dealership, checked in, and was informed that the car was indeed ready and an employee would retrieve it from the off-site parking lot. Fifteen minutes later, the car arrived.
FIGURE 9-1
Classification tree for the subfunction “identify a person”
What other alternatives exist to implement the subfunction we could call “product handoff”? Let’s look beyond car dealerships and contrast BMW’s implementation with how Wawa, a convenience store chain in the mid-Atlantic region known for great made-to-order food, performs basically the same subfunction. At Wawa, you can order a sandwich through an app and then pick it up at the store (a respond-to-desire customer relationship, as we discussed in chapter 4). Since you want your meal to be fresh when you pick it up, Wawa uses geo-fencing with the customer’s phone to sense proximity and have the food ready on arrival. Preparing it just in time creates a magical user experience. With this kind of service, a regional convenience store selling $5 sandwiches outperforms a global automaker selling $50,000 cars.
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