Shomila Malik is Head of Enterprise Lab at Telefonica O2 UK.
She has over 14 years experience in conception and delivery of creative mobile services for IBM, FT and Telefonica O2, blending business, technology, and innovation management.
I was happy to meet her at the European Open Innovation Summit in Brussels and happy to discover that we share many commonalities in our experience of rapid innovation. Shomila (@shomila) delivered a brilliant lecture about achieving fast and better innovation in partnership, in the noteworthy framework of O2 Enterprise Lab initiative.
Telefonica/O2 Enterprise Lab scope and objectives
The landscape has changed for us and so has the competition: the competition is able to try out betas and iterate fast, even fail and be accepted.
The traditional process is suited to traditional products. In this model, it’s difficult to get half way through and change your mind – too much time, effort and cost have already been spent – even with agile development processes. For the telco world, it meant every product adhered to the ‘telco grade’ but this whole process takes months and months. It has many dependancies – especially the suppliers who are usually other large companies with similar processes. It quickly gets complex and very difficult.
Trying to innovate in this process is a challenge – too much room for distraction and too many stakeholders. A few companies succeed when they are ruthlessly focussed on a product.
The Enterprise Lab is a division of the Lab at O2 which is a team that develops beta products to go to market faster. Started in Jan 2011, it operates in the UK – close to the market. It allows people outside O2 to try beta products, Consumer and Enterprise, under our own lab brand. Successful betas move to an industrialization path outside of the lab.
The management is very light. The team is about 40 people, mostly developers and there are 4 managers. The role of the managers involves selecting projects to work on, allocating resource to projects, working with other areas of the business to maintain good relationships with stakeholders, manage budgets, coaching and setting product strategy and goals.
The objectives are tied to those of the business but have specific targets for the lab – some objectives are based on product success and some are around people.
There is a high degree of autonomy for the lab – we are able to set our own objectives and strategy. A steering committee is in place which meets once a quarter to give feedback on our direction – it is made up of a small number of directors. The idea is that the steering committee acts as our VC’s and we try to operate as a startup as much as possible.
Innovation culture and tools of O2 Enterprise Lab
We have a focus on openness: open at the front end and in execution, open apis, open source, beta testing. Openness is also necessary as we let others bring the product through industrialization.
We get more ideas at the front end – sometimes through crowdsourcing across the company and pitching within the team. Sometimes ideas are prototyped within days so we can understand what is being proposed. Having developers in the team is key to this. Using open APIs mean we have more creative choice and it’s the way we need to operate with Twitter, Facebook, etc. We use open source components if needed – different from the usual approach and give back to the open source community. We test openly – with real customers in a beta trial.
We use tools that fit our purpose – some of those may be already mandated from IT (e.g. Yammer) and other times they are ones that specifically suit our style of working. During projects we use tools to track progress like Pivotal Tracker or base camp – github to share code. For the front end of innovation, we have tried many types of tools to manage idea generation but as the team is small we now rely on pitch sessions where people from within the lab, or close to us are encouraged to pitch ideas to the management team. We then decide on which ideas best fit our criteria and resource schedules. The process involves face to face meetings rather than a specific tool.
We use a tool called getsatisfaction to obtain user feedback for beta projects.
“O2 Connect”: developing VoIP on mobile in 4 months
In the UK, mobile coverage is not so good at home and at the office: a lot of users are going to Skype and Viber, accessing their phone over wifi in VoIP technology. Skype owns phone numbers, so you can even get called on your own phone number. We decided to explore the opportunity of competing with our own VoIP service.
We sought a specialist partner (on VoIP) because we wanted something high quality that was different – we knew we could produce something better with a niche provider rather than a large supplier who would provide the same for all telcos. We wanted a partner who was as motivated as us – and would challenge our own thinking. By working with a small, focused partner, we could cut out dependencies, distractions and shorten the time to market.
We set-up an “open innovation” collaboration with start-up Voxygen (@voxygen), a technology company specialized in designing innovative communications products : sharing product definition, leveraging on Voxygen know-how to create open source components, acting with a similar culture, led us to great collaboration and faster development.
“O2 Connect” was delivered in 4 months, integrated with our network, and launched in October 2011. It won the ‘highly commended’ award for best new VOIP service.
Key learnings of collaborative experience
There are challenges along the way, quite traditional in the large corporation & small company tandem : working with the rest of the core business and large corporation policies (e.g. finance, legal, etc) , getting paid is sometimes difficult for the small entity! Convincing the business that open source was a viable option turned also to be a challenge.
Voxygen is actually convinced that “Big companies need to work differently, delegating some supply and budget control to labs, almost in a separate unit.”
The key succes factors coming to my mind are as follows:
- Leap of faith between partners: concept of fair play;
- Flexibility: failure has to be an option;
- Board commitment facilitating integration: “there is no choice”;
- Mutual trust and progressive cooperation between core co and creative lab: to get buy in, it helped that it was a small change at first. Getting ‘buy in’ is not a push but a pull: creating desire to create results. The biggest challenge is definitely to bring back the creative product in the organisation; it require the creation of a shared ground among stakeholders.
Main levers to accelerate speed of innovation
The main lever was autonomy for the team and high level support. One of the key factors to be able to work fast is to reduce the number of decision makers so we worked in a small team and made key decisions ourselves.
However, high level support is required so that the sponsor can manage expectations at the board and give the project visibility and priority.